FILE h3734.enr
          --H.R.3734--
              H.R.3734
          One Hundred Fourth Congress
          of the
          United States of America
          AT THE SECOND SESSION
          Begun and held at the City of Washington on Wednesday,
          the third day of January, one thousand nine hundred and ninety-six
          An Act
          To provide for reconciliation pursuant to section 201(a)(1) of the
          concurrent resolution on the budget for fiscal year 1997.
           [Italic->]   Be it enacted by the Senate and House of
          Representatives of the United States of America in Congress
          assembled, [<-Italic]
          SECTION 1. SHORT TITLE.
            This Act may be cited as the `Personal Responsibility and Work
          Opportunity Reconciliation Act of 1996'.
          SEC. 2. TABLE OF CONTENTS.
            The table of contents for this Act is as follows:
            TITLE I--BLOCK GRANTS FOR TEMPORARY ASSISTANCE FOR NEEDY FAMILIES
          Sec. 101. Findings.
          Sec. 102. Reference to Social Security Act.
          Sec. 103. Block grants to States.
          Sec. 104. Services provided by charitable, religious, or private
              organizations.
          Sec. 105. Census data on grandparents as primary caregivers for
              their grandchildren.
          Sec. 106. Report on data processing.
          Sec. 107. Study on alternative outcomes measures.
          Sec. 108. Conforming amendments to the Social Security Act.
          Sec. 109. Conforming amendments to the Food Stamp Act of 1977 and
              related provisions.
          Sec. 110. Conforming amendments to other laws.
          Sec. 111. Development of prototype of counterfeit-resistant Social
              Security card required.
          Sec. 112. Modifications to the job opportunities for certain
              low-income individuals program.
          Sec. 113. Secretarial submission of legislative proposal for
              technical and conforming amendments.
          Sec. 114. Assuring medicaid coverage for low-income families.
          Sec. 115. Denial of assistance and benefits for certain 
              drug-related convictions.
          Sec. 116. Effective date; transition rule.
                         TITLE II--SUPPLEMENTAL SECURITY INCOME
          Sec. 200. Reference to Social Security Act.
                          SUBTITLE A--ELIGIBILITY RESTRICTIONS
          Sec. 201. Denial of SSI benefits for 10 years to individuals found
              to have fraudulently misrepresented residence in order to 
              obtain benefits simultaneously in 2 or more States.
          Sec. 202. Denial of SSI benefits for fugitive felons and probation
              and parole violators.
          Sec. 203. Treatment of prisoners.
          Sec. 204. Effective date of application for benefits.
                       SUBTITLE B--BENEFITS FOR DISABLED CHILDREN
          Sec. 211. Definition and eligibility rules.
          Sec. 212. Eligibility redeterminations and continuing disability
              reviews.
          Sec. 213. Additional accountability requirements.
          Sec. 214. Reduction in cash benefits payable to institutionalized
              individuals whose medical costs are covered by private insurance.
          Sec. 215. Regulations.
                      SUBTITLE C--ADDITIONAL ENFORCEMENT PROVISION
          Sec. 221. Installment payment of large past-due supplemental
              security income benefits.
          Sec. 222. Regulations.
           SUBTITLE D--STUDIES REGARDING SUPPLEMENTAL SECURITY INCOME PROGRAM
          Sec. 231. Annual report on the supplemental security income program.
          Sec. 232. Study by General Accounting Office.
                                TITLE III--CHILD SUPPORT
          Sec. 300. Reference to Social Security Act.
             SUBTITLE A--ELIGIBILITY FOR SERVICES; DISTRIBUTION OF PAYMENTS
          Sec. 301. State obligation to provide child support enforcement
              services.
          Sec. 302. Distribution of child support collections.
          Sec. 303. Privacy safeguards.
          Sec. 304. Rights to notification of hearings.
                          SUBTITLE B--LOCATE AND CASE TRACKING
          Sec. 311. State case registry.
          Sec. 312. Collection and disbursement of support payments.
          Sec. 313. State directory of new hires.
          Sec. 314. Amendments concerning income withholding.
          Sec. 315. Locator information from interstate networks.
          Sec. 316. Expansion of the Federal Parent Locator Service.
          Sec. 317. Collection and use of Social Security numbers for use in
              child support enforcement.
                  SUBTITLE C--STREAMLINING AND UNIFORMITY OF PROCEDURES
          Sec. 321. Adoption of uniform State laws.
          Sec. 322. Improvements to full faith and credit for child support
              orders.
          Sec. 323. Administrative enforcement in interstate cases.
          Sec. 324. Use of forms in interstate enforcement.
          Sec. 325. State laws providing expedited procedures.
                           SUBTITLE D--PATERNITY ESTABLISHMENT
          Sec. 331. State laws concerning paternity establishment.
          Sec. 332. Outreach for voluntary paternity establishment.
          Sec. 333. Cooperation by applicants for and recipients of part A
              assistance.
                     SUBTITLE E--PROGRAM ADMINISTRATION AND FUNDING
          Sec. 341. Performance-based incentives and penalties.
          Sec. 342. Federal and State reviews and audits.
          Sec. 343. Required reporting procedures.
          Sec. 344. Automated data processing requirements.
          Sec. 345. Technical assistance.
          Sec. 346. Reports and data collection by the Secretary.
              SUBTITLE F--ESTABLISHMENT AND MODIFICATION OF SUPPORT ORDERS
          Sec. 351. Simplified process for review and adjustment of child
              support orders.
          Sec. 352. Furnishing consumer reports for certain purposes relating
              to child support.
          Sec. 353. Nonliability for financial institutions providing
              financial records to State child support enforcement agencies 
              in child support cases.
                        SUBTITLE G--ENFORCEMENT OF SUPPORT ORDERS
          Sec. 361. Internal Revenue Service collection of arrearages.
          Sec. 362. Authority to collect support from Federal employees.
          Sec. 363. Enforcement of child support obligations of members of 
              the Armed Forces.
          Sec. 364. Voiding of fraudulent transfers.
          Sec. 365. Work requirement for persons owing past-due child support.
          Sec. 366. Definition of support order.
          Sec. 367. Reporting arrearages to credit bureaus.
          Sec. 368. Liens.
          Sec. 369. State law authorizing suspension of licenses.
          Sec. 370. Denial of passports for nonpayment of child support.
          Sec. 371. International support enforcement.
          Sec. 372. Financial institution data matches.
          Sec. 373. Enforcement of orders against paternal or maternal
              grandparents in cases of minor parents.
          Sec. 374. Nondischargeability in bankruptcy of certain debts for 
              the support of a child.
          Sec. 375. Child support enforcement for Indian tribes.
                               SUBTITLE H--MEDICAL SUPPORT
          Sec. 381. Correction to ERISA definition of medical child support
              order.
          Sec. 382. Enforcement of orders for health care coverage.
                SUBTITLE I--ENHANCING RESPONSIBILITY AND OPPORTUNITY FOR
                                 NON-RESIDENTIAL PARENTS
          Sec. 391. Grants to States for access and visitation programs.
                  SUBTITLE J--EFFECTIVE DATES AND CONFORMING AMENDMENTS
          Sec. 395. Effective dates and conforming amendments.
              TITLE IV--RESTRICTING WELFARE AND PUBLIC BENEFITS FOR ALIENS
          Sec. 400. Statements of national policy concerning welfare and
              immigration.
                      SUBTITLE A--ELIGIBILITY FOR FEDERAL BENEFITS
          Sec. 401. Aliens who are not qualified aliens ineligible for 
              Federal public benefits.
          Sec. 402. Limited eligibility of qualified aliens for certain
              Federal programs.
          Sec. 403. Five-year limited eligibility of qualified aliens for
              Federal means-tested public benefit.
          Sec. 404. Notification and information reporting.
          SUBTITLE B--ELIGIBILITY FOR STATE AND LOCAL PUBLIC BENEFITS PROGRAMS
          Sec. 411. Aliens who are not qualified aliens or nonimmigrants
              ineligible for State and local public benefits.
          Sec. 412. State authority to limit eligibility of qualified aliens
              for State public benefits.
               SUBTITLE C--ATTRIBUTION OF INCOME AND AFFIDAVITS OF SUPPORT
          Sec. 421. Federal attribution of sponsor's income and resources to
              alien.
          Sec. 422. Authority for States to provide for attribution of
              sponsors income and resources to the alien with respect to 
              State programs.
          Sec. 423. Requirements for sponsor's affidavit of support.
                             SUBTITLE D--GENERAL PROVISIONS
          Sec. 431. Definitions.
          Sec. 432. Verification of eligibility for Federal public benefits.
          Sec. 433. Statutory construction.
          Sec. 434. Communication between State and local government agencies
              and the Immigration and Naturalization Service.
          Sec. 435. Qualifying quarters.
             SUBTITLE E--CONFORMING AMENDMENTS RELATING TO ASSISTED HOUSING
          Sec. 441. Conforming amendments relating to assisted housing.
           SUBTITLE F--EARNING INCOME CREDIT DENIED TO UNAUTHORIZED EMPLOYEES
          Sec. 451. Earned income credit denied to individuals not authorized
              to be employed in the United States.
                                TITLE V--CHILD PROTECTION
          Sec. 501. Authority of States to make foster care maintenance
              payments on behalf of children in any private child care
              institution.
          Sec. 502. Extension of enhanced match for implementation of
              statewide automated child welfare information systems.
          Sec. 503. National random sample study of child welfare.
          Sec. 504. Redesignation of section 1123.
          Sec. 505. Kinship care.
                                  TITLE VI--CHILD CARE
          Sec. 601. Short title and references.
          Sec. 602. Goals.
          Sec. 603. Authorization of appropriations and entitlement authority.
          Sec. 604. Lead agency.
          Sec. 605. Application and plan.
          Sec. 606. Limitation on State allotments.
          Sec. 607. Activities to improve the quality of child care.
          Sec. 608. Repeal of early childhood development and before- and
              after-school care requirement.
          Sec. 609. Administration and enforcement.
          Sec. 610. Payments.
          Sec. 611. Annual report and audits.
          Sec. 612. Report by the Secretary.
          Sec. 613. Allotments.
          Sec. 614. Definitions.
          Sec. 615. Effective date.
                           TITLE VII--CHILD NUTRITION PROGRAMS
                          SUBTITLE A--NATIONAL SCHOOL LUNCH ACT
          Sec. 701. State disbursement to schools.
          Sec. 702. Nutritional and other program requirements.
          Sec. 703. Free and reduced price policy statement.
          Sec. 704. Special assistance.
          Sec. 705. Miscellaneous provisions and definitions.
          Sec. 706. Summer food service program for children.
          Sec. 707. Commodity distribution.
          Sec. 708. Child and adult care food program.
          Sec. 709. Pilot projects.
          Sec. 710. Reduction of paperwork.
          Sec. 711. Information on income eligibility.
          Sec. 712. Nutrition guidance for child nutrition programs.
                         SUBTITLE B--CHILD NUTRITION ACT OF 1966
          Sec. 721. Special milk program.
          Sec. 722. Free and reduced price policy statement.
          Sec. 723. School breakfast program authorization.
          Sec. 724. State administrative expenses.
          Sec. 725. Regulations.
          Sec. 726. Prohibitions.
          Sec. 727. Miscellaneous provisions and definitions.
          Sec. 728. Accounts and records.
          Sec. 729. Special supplemental nutrition program for women, 
              infants, and children.
          Sec. 730. Cash grants for nutrition education.
          Sec. 731. Nutrition education and training.
                          SUBTITLE C--MISCELLANEOUS PROVISIONS
          Sec. 741. Coordination of school lunch, school breakfast, and 
              summer food service programs.
          Sec. 742. Requirements relating to provision of benefits based on
              citizenship, alienage, or immigration status under the National
              School Lunch Act, the Child Nutrition Act of 1966, and certain
              other acts.
                   TITLE VIII--FOOD STAMPS AND COMMODITY DISTRIBUTION
                             SUBTITLE A--FOOD STAMP PROGRAM
          Sec. 801. Definition of certification period.
          Sec. 802. Definition of coupon.
          Sec. 803. Treatment of children living at home.
          Sec. 804. Adjustment of thrifty food plan.
          Sec. 805. Definition of homeless individual.
          Sec. 806. State option for eligibility standards.
          Sec. 807. Earnings of students.
          Sec. 808. Energy assistance.
          Sec. 809. Deductions from income.
          Sec. 810. Vehicle allowance.
          Sec. 811. Vendor payments for transitional housing counted as income.
          Sec. 812. Simplified calculation of income for the self-employed.
          Sec. 813. Doubled penalties for violating food stamp program
              requirements.
          Sec. 814. Disqualification of convicted individuals.
          Sec. 815. Disqualification.
          Sec. 816. Caretaker exemption.
          Sec. 817. Employment and training.
          Sec. 818. Food stamp eligibility.
          Sec. 819. Comparable treatment for disqualification.
          Sec. 820. Disqualification for receipt of multiple food stamp
              benefits.
          Sec. 821. Disqualification of fleeing felons.
          Sec. 822. Cooperation with child support agencies.
          Sec. 823. Disqualification relating to child support arrears.
          Sec. 824. Work requirement.
          Sec. 825. Encouragement of electronic benefit transfer systems.
          Sec. 826. Value of minimum allotment.
          Sec. 827. Benefits on recertification.
          Sec. 828. Optional combined allotment for expedited households.
          Sec. 829. Failure to comply with other means-tested public
              assistance programs.
          Sec. 830. Allotments for households residing in centers.
          Sec. 831. Condition precedent for approval of retail food stores 
              and wholesale food concerns.
          Sec. 832. Authority to establish authorization periods.
          Sec. 833. Information for verifying eligibility for authorization.
          Sec. 834. Waiting period for stores that fail to meet authorization
              criteria.
          Sec. 835. Operation of food stamp offices.
          Sec. 836. State employee and training standards.
          Sec. 837. Exchange of law enforcement information.
          Sec. 838. Expedited coupon service.
          Sec. 839. Withdrawing fair hearing requests.
          Sec. 840. Income, eligibility, and immigration status verification
              systems.
          Sec. 841. Investigations.
          Sec. 842. Disqualification of retailers who intentionally submit
              falsified applications.
          Sec. 843. Disqualification of retailers who are disqualified under
              the WIC program.
          Sec. 844. Collection of overissuances.
          Sec. 845. Authority to suspend stores violating program 
              requirements pending administrative and judicial review.
          Sec. 846. Expanded criminal forfeiture for violations.
          Sec. 847. Limitation on Federal match.
          Sec. 848. Standards for administration.
          Sec. 849. Work supplementation or support program.
          Sec. 850. Waiver authority.
          Sec. 851. Response to waivers.
          Sec. 852. Employment initiatives program.
          Sec. 853. Reauthorization.
          Sec. 854. Simplified food stamp program.
          Sec. 855. Study of the use of food stamps to purchase vitamins and
              minerals.
          Sec. 856. Deficit reduction.
                       SUBTITLE B--COMMODITY DISTRIBUTION PROGRAMS
          Sec. 871. Emergency food assistance program.
          Sec. 872. Food bank demonstration project.
          Sec. 873. Hunger prevention programs.
          Sec. 874. Report on entitlement commodity processing.
                     SUBTITLE C--ELECTRONIC BENEFIT TRANSFER SYSTEMS
          Sec. 891. Provisions to encourage electronic benefit transfer
              systems.
                                 TITLE IX--MISCELLANEOUS
          Sec. 901. Appropriation by State legislatures.
          Sec. 902. Sanctioning for testing positive for controlled substances.
          Sec. 903. Elimination of housing assistance with respect to 
              fugitive felons and probation and parole violators.
          Sec. 904. Sense of the Senate regarding the inability of the
              noncustodial parent to pay child support.
          Sec. 905. Establishing national goals to prevent teenage pregnancies.
          Sec. 906. Sense of the Senate regarding enforcement of statutory
              rape laws.
          Sec. 907. Provisions to encourage electronic benefit transfer
              systems.
          Sec. 908. Reduction of block grants to States for social services;
              use of vouchers.
          Sec. 909. Rules relating to denial of earned income credit on basis
              of disqualified income.
          Sec. 910. Modification of adjusted gross income definition for
              earned income credit.
          Sec. 911. Fraud under means-tested welfare and public assistance
              programs.
          Sec. 912. Abstinence education.
          Sec. 913. Change in reference.
            TITLE I--BLOCK GRANTS FOR TEMPORARY ASSISTANCE FOR NEEDY FAMILIES
          SEC. 101. FINDINGS.
            The Congress makes the following findings:
                (1) Marriage is the foundation of a successful society.
                (2) Marriage is an essential institution of a successful
              society which promotes the interests of children.
                (3) Promotion of responsible fatherhood and motherhood is
              integral to successful child rearing and the well-being of
              children.
                (4) In 1992, only 54 percent of single-parent families with
              children had a child support order established and, of that 54
              percent, only about one-half received the full amount due. Of
              the cases enforced through the public child support enforcement
              system, only 18 percent of the caseload has a collection.
                (5) The number of individuals receiving aid to families with
              dependent children (in this section referred to as `AFDC') has
              more than tripled since 1965. More than two-thirds of these
              recipients are children. Eighty-nine percent of children
              receiving AFDC benefits now live in homes in which no father is
              present.
                    (A)(i) The average monthly number of children receiving
                  AFDC benefits--
                        (I) was 3,300,000 in 1965;
                        (II) was 6,200,000 in 1970;
                        (III) was 7,400,000 in 1980; and
                        (IV) was 9,300,000 in 1992.
                    (ii) While the number of children receiving AFDC benefits
                  increased nearly threefold between 1965 and 1992, the total
                  number of children in the United States aged 0 to 18 has
                  declined by 5.5 percent.
                    (B) The Department of Health and Human Services has
                  estimated that 12,000,000 children will receive AFDC
                  benefits within 10 years.
                    (C) The increase in the number of children receiving
                  public assistance is closely related to the increase in
                  births to unmarried women. Between 1970 and 1991, the
                  percentage of live births to unmarried women increased
                  nearly threefold, from 10.7 percent to 29.5 percent.
                (6) The increase of out-of-wedlock pregnancies and births is
              well documented as follows:
                    (A) It is estimated that the rate of nonmarital teen
                  pregnancy rose 23 percent from 54 pregnancies per 1,000
                  unmarried teenagers in 1976 to 66.7 pregnancies in 1991. 
                  The overall rate of nonmarital pregnancy rose 14 percent
                  from 90.8 pregnancies per 1,000 unmarried women in 1980 to
                  103 in both 1991 and 1992. In contrast, the overall
                  pregnancy rate for married couples decreased 7.3 percent
                  between 1980 and 1991, from 126.9 pregnancies per 1,000
                  married women in 1980 to 117.6 pregnancies in 1991.
                    (B) The total of all out-of-wedlock births between 1970
                  and 1991 has risen from 10.7 percent to 29.5 percent and if
                  the current trend continues, 50 percent of all births by 
                  the year 2015 will be out-of-wedlock.
                (7) An effective strategy to combat teenage pregnancy must
              address the issue of male responsibility, including statutory
              rape culpability and prevention.  The increase of teenage
              pregnancies among the youngest girls is particularly severe and
              is linked to predatory sexual practices by men who are
              significantly older.
                    (A) It is estimated that in the late 1980's, the rate for
                  girls age 14 and under giving birth increased 26 percent.
                    (B) Data indicates that at least half of the children 
                  born to teenage mothers are fathered by adult men. 
                  Available data suggests that almost 70 percent of births to
                  teenage girls are fathered by men over age 20.
                    (C) Surveys of teen mothers have revealed that a majority
                  of such mothers have histories of sexual and physical 
                  abuse, primarily with older adult men.
                (8) The negative consequences of an out-of-wedlock birth on
              the mother, the child, the family, and society are well
              documented as follows:
                    (A) Young women 17 and under who give birth outside of
                  marriage are more likely to go on public assistance and to
                  spend more years on welfare once enrolled. These combined
                  effects of `younger and longer' increase total AFDC costs
                  per household by 25 percent to 30 percent for 17-year-olds.
                    (B) Children born out-of-wedlock have a substantially
                  higher risk of being born at a very low or moderately low
                  birth weight.
                    (C) Children born out-of-wedlock are more likely to
                  experience low verbal cognitive attainment, as well as more
                  child abuse, and neglect.
                    (D) Children born out-of-wedlock were more likely to have
                  lower cognitive scores, lower educational aspirations, and 
                  a greater likelihood of becoming teenage parents themselves.
                    (E) Being born out-of-wedlock significantly reduces the
                  chances of the child growing up to have an intact marriage.
                    (F) Children born out-of-wedlock are 3 times more likely
                  to be on welfare when they grow up.
                (9) Currently 35 percent of children in single-parent homes
              were born out-of-wedlock, nearly the same percentage as that of
              children in single-parent homes whose parents are divorced (37
              percent). While many parents find themselves, through divorce 
              or tragic circumstances beyond their control, facing the
              difficult task of raising children alone, nevertheless, the
              negative consequences of raising children in single-parent 
              homes are well documented as follows:
                    (A) Only 9 percent of married-couple families with
                  children under 18 years of age have income below the
                  national poverty level. In contrast, 46 percent of
                  female-headed households with children under 18 years of 
                  age are below the national poverty level.
                    (B) Among single-parent families, nearly  1/2  of the
                  mothers who never married received AFDC while only  1/5  of
                  divorced mothers received AFDC.
                    (C) Children born into families receiving welfare
                  assistance are 3 times more likely to be on welfare when
                  they reach adulthood than children not born into families
                  receiving welfare.
                    (D) Mothers under 20 years of age are at the greatest 
                  risk of bearing low birth weight babies.
                    (E) The younger the single-parent mother, the less likely
                  she is to finish high school.
                    (F) Young women who have children before finishing high
                  school are more likely to receive welfare assistance for a
                  longer period of time.
                    (G) Between 1985 and 1990, the public cost of births to
                  teenage mothers under the aid to families with dependent
                  children program, the food stamp program, and the medicaid
                  program has been estimated at $120,000,000,000.
                    (H) The absence of a father in the life of a child has a
                  negative effect on school performance and peer adjustment.
                    (I) Children of teenage single parents have lower
                  cognitive scores, lower educational aspirations, and a
                  greater likelihood of becoming teenage parents themselves.
                    (J) Children of single-parent homes are 3 times more
                  likely to fail and repeat a year in grade school than are
                  children from intact 2-parent families.
                    (K) Children from single-parent homes are almost 4 times
                  more likely to be expelled or suspended from school.
                    (L) Neighborhoods with larger percentages of youth aged 
                  12 through 20 and areas with higher percentages of
                  single-parent households have higher rates of violent crime.
                    (M) Of those youth held for criminal offenses within the
                  State juvenile justice system, only 29.8 percent lived
                  primarily in a home with both parents. In contrast to these
                  incarcerated youth, 73.9 percent of the 62,800,000 children
                  in the Nation's resident population were living with both
                  parents.
                (10) Therefore, in light of this demonstration of the crisis
              in our Nation, it is the sense of the Congress that prevention
              of out-of-wedlock pregnancy and reduction in out-of-wedlock
              birth are very important Government interests and the policy
              contained in part A of title IV of the Social Security Act (as
              amended by section 103(a) of this Act) is intended to address
              the crisis.
          SEC. 102. REFERENCE TO SOCIAL SECURITY ACT.
            Except as otherwise specifically provided, wherever in this title
          an amendment is expressed in terms of an amendment to or repeal of 
          a section or other provision, the reference shall be considered to
          be made to that section or other provision of the Social Security
          Act.
          SEC. 103. BLOCK GRANTS TO STATES.
            (a) IN GENERAL- Part A of title IV (42 U.S.C. 601 et seq.) is
          amended--
                (1) by striking all that precedes section 418 (as added by
              section 603(b)(2) of this Act) and inserting the following:
           `PART A--BLOCK GRANTS TO STATES FOR TEMPORARY ASSISTANCE FOR NEEDY
                                        FAMILIES
          `SEC. 401. PURPOSE.
            `(a) IN GENERAL- The purpose of this part is to increase the
          flexibility of States in operating a program designed to--
                `(1) provide assistance to needy families so that children 
              may be cared for in their own homes or in the homes of relatives;
                `(2) end the dependence of needy parents on government
              benefits by promoting job preparation, work, and marriage;
                `(3) prevent and reduce the incidence of out-of-wedlock
              pregnancies and establish annual numerical goals for preventing
              and reducing the incidence of these pregnancies; and
                `(4) encourage the formation and maintenance of two-parent
              families.
            `(b) NO INDIVIDUAL ENTITLEMENT- This part shall not be 
          interpreted to entitle any individual or family to assistance under
          any State program funded under this part.
          `SEC. 402. ELIGIBLE STATES; STATE PLAN.
            `(a) IN GENERAL- As used in this part, the term `eligible State'
          means, with respect to a fiscal year, a State that, during the
          2-year period immediately preceding the fiscal year, has submitted
          to the Secretary a plan that the Secretary has found includes the
          following:
                `(1) OUTLINE OF FAMILY ASSISTANCE PROGRAM- 
                    `(A) GENERAL PROVISIONS- A written document that outlines
                  how the State intends to do the following:
                        `(i) Conduct a program, designed to serve all
                      political subdivisions in the State (not necessarily in
                      a uniform manner), that provides assistance to needy
                      families with (or expecting) children and provides
                      parents with job preparation, work, and support 
                      services to enable them to leave the program and become
                      self-sufficient.
                        `(ii) Require a parent or caretaker receiving
                      assistance under the program to engage in work (as
                      defined by the State) once the State determines the
                      parent or caretaker is ready to engage in work, or once
                      the parent or caretaker has received assistance under
                      the program for 24 months (whether or not consecutive),
                      whichever is earlier.
                        `(iii) Ensure that parents and caretakers receiving
                      assistance under the program engage in work activities
                      in accordance with section 407.
                        `(iv) Take such reasonable steps as the State deems
                      necessary to restrict the use and disclosure of
                      information about individuals and families receiving
                      assistance under the program attributable to funds
                      provided by the Federal Government.
                        `(v) Establish goals and take action to prevent and
                      reduce the incidence of out-of-wedlock pregnancies, 
                      with special emphasis on teenage pregnancies, and
                      establish numerical goals for reducing the illegitimacy
                      ratio of the State (as defined in section 403(a)(2)(B))
                      for calendar years 1996 through 2005.
                        `(vi) Conduct a program, designed to reach State and
                      local law enforcement officials, the education system,
                      and relevant counseling services, that provides
                      education and training on the problem of statutory rape
                      so that teenage pregnancy prevention programs may be
                      expanded in scope to include men.
                    `(B) SPECIAL PROVISIONS- 
                        `(i) The document shall indicate whether the State
                      intends to treat families moving into the State from
                      another State differently than other families under the
                      program, and if so, how the State intends to treat such
                      families under the program.
                        `(ii) The document shall indicate whether the State
                      intends to provide assistance under the program to
                      individuals who are not citizens of the United States,
                      and if so, shall include an overview of such assistance.
                        `(iii) The document shall set forth objective 
                      criteria for the delivery of benefits and the
                      determination of eligibility and for fair and equitable
                      treatment, including an explanation of how the State
                      will provide opportunities for recipients who have been
                      adversely affected to be heard in a State 
                      administrative or appeal process.
                        `(iv) Not later than 1 year after the date of
                      enactment of this Act, unless the chief executive
                      officer of the State opts out of this provision by
                      notifying the Secretary, a State shall, consistent with
                      the exception provided in section 407(e)(2), require a
                      parent or caretaker receiving assistance under the
                      program who, after receiving such assistance for 2
                      months is not exempt from work requirements and is not
                      engaged in work, as determined under section 407(c), to
                      participate in community service employment, with
                      minimum hours per week and tasks to be determined by 
                      the State.
                `(2) CERTIFICATION THAT THE STATE WILL OPERATE A CHILD 
              SUPPORT ENFORCEMENT PROGRAM- A certification by the chief
              executive officer of the State that, during the fiscal year, 
              the State will operate a child support enforcement program 
              under the State plan approved under part D.
                `(3) CERTIFICATION THAT THE STATE WILL OPERATE A FOSTER CARE
              AND ADOPTION ASSISTANCE PROGRAM- A certification by the chief
              executive officer of the State that, during the fiscal year, 
              the State will operate a foster care and adoption assistance
              program under the State plan approved under part E, and that 
              the State will take such actions as are necessary to ensure 
              that children receiving assistance under such part are eligible
              for medical assistance under the State plan under title XIX.
                `(4) CERTIFICATION OF THE ADMINISTRATION OF THE PROGRAM- A
              certification by the chief executive officer of the State
              specifying which State agency or agencies will administer and
              supervise the program referred to in paragraph (1) for the
              fiscal year, which shall include assurances that local
              governments and private sector organizations--
                    `(A) have been consulted regarding the plan and design of
                  welfare services in the State so that services are provided
                  in a manner appropriate to local populations; and
                    `(B) have had at least 45 days to submit comments on the
                  plan and the design of such services.
                `(5) CERTIFICATION THAT THE STATE WILL PROVIDE INDIANS WITH
              EQUITABLE ACCESS TO ASSISTANCE- A certification by the chief
              executive officer of the State that, during the fiscal year, 
              the State will provide each member of an Indian tribe, who is
              domiciled in the State and is not eligible for assistance under
              a tribal family assistance plan approved under section 412, 
              with equitable access to assistance under the State program
              funded under this part attributable to funds provided by the
              Federal Government.
                `(6) CERTIFICATION OF STANDARDS AND PROCEDURES TO ENSURE
              AGAINST PROGRAM FRAUD AND ABUSE- A certification by the chief
              executive officer of the State that the State has established
              and is enforcing standards and procedures to ensure against
              program fraud and abuse, including standards and procedures
              concerning nepotism, conflicts of interest among individuals
              responsible for the administration and supervision of the State
              program, kickbacks, and the use of political patronage.
                `(7) OPTIONAL CERTIFICATION OF STANDARDS AND PROCEDURES TO
              ENSURE THAT THE STATE WILL SCREEN FOR AND IDENTIFY DOMESTIC
              VIOLENCE-
                    `(A) IN GENERAL- At the option of the State, a
                  certification by the chief executive officer of the State
                  that the State has established and is enforcing standards
                  and procedures to--
                        `(i) screen and identify individuals receiving
                      assistance under this part with a history of domestic
                      violence while maintaining the confidentiality of such
                      individuals;
                        `(ii) refer such individuals to counseling and
                      supportive services; and
                        `(iii) waive, pursuant to a determination of good
                      cause, other program requirements such as time limits
                      (for so long as necessary) for individuals receiving
                      assistance, residency requirements, child support
                      cooperation requirements, and family cap provisions, in
                      cases where compliance with such requirements would 
                      make it more difficult for individuals receiving
                      assistance under this part to escape domestic violence
                      or unfairly penalize such individuals who are or have
                      been victimized by such violence, or individuals who 
                      are at risk of further domestic violence.
                    `(B) DOMESTIC VIOLENCE DEFINED- For purposes of this
                  paragraph, the term `domestic violence' has the same 
                  meaning as the term `battered or subjected to extreme
                  cruelty', as defined in section 408(a)(7)(C)(iii).
            `(b) PUBLIC AVAILABILITY OF STATE PLAN SUMMARY- The State shall
          make available to the public a summary of any plan submitted by the
          State under this section.
          `SEC. 403. GRANTS TO STATES.
            `(a) GRANTS- 
                `(1) FAMILY ASSISTANCE GRANT- 
                    `(A) IN GENERAL- Each eligible State shall be entitled to
                  receive from the Secretary, for each of fiscal years 1996,
                  1997, 1998, 1999, 2000, 2001, and 2002, a grant in an 
                  amount equal to the State family assistance grant.
                    `(B) STATE FAMILY ASSISTANCE GRANT DEFINED- As used in
                  this part, the term `State family assistance grant' means
                  the greatest of--
                        `(i)  1/3  of the total amount required to be paid to
                      the State under former section 403 (as in effect on
                      September 30, 1995) for fiscal years 1992, 1993, and
                      1994 (other than with respect to amounts expended by 
                      the State for child care under subsection (g) or (i) of
                      former section 402 (as so in effect));
                        `(ii)(I) the total amount required to be paid to the
                      State under former section 403 for fiscal year 1994
                      (other than with respect to amounts expended by the
                      State for child care under subsection (g) or (i) of
                      former section 402 (as so in effect)); plus
                        `(II) an amount equal to 85 percent of the amount (if
                      any) by which the total amount required to be paid to
                      the State under former section 403(a)(5) for emergency
                      assistance for fiscal year 1995 exceeds the total 
                      amount required to be paid to the State under former
                      section 403(a)(5) for fiscal year 1994, if, during
                      fiscal year 1994 or 1995, the Secretary approved under
                      former section 402 an amendment to the former State 
                      plan with respect to the provision of emergency
                      assistance; or
                        `(iii)  4/3  of the total amount required to be paid
                      to the State under former section 403 (as in effect on
                      September 30, 1995) for the 1st 3 quarters of fiscal
                      year 1995 (other than with respect to amounts expended
                      by the State under the State plan approved under part F
                      (as so in effect) or for child care under subsection 
                      (g) or (i) of former section 402 (as so in effect)),
                      plus the total amount required to be paid to the State
                      for fiscal year 1995 under former section 403(l) (as so
                      in effect).
                    `(C) TOTAL AMOUNT REQUIRED TO BE PAID TO THE STATE UNDER
                  FORMER SECTION 403 DEFINED- As used in this part, the term
                  `total amount required to be paid to the State under former
                  section 403' means, with respect to a fiscal year--
                        `(i) in the case of a State to which section 1108 
                      does not apply, the sum of--
            `(I) the Federal share of maintenance assistance expenditures for
          the fiscal year, before reduction pursuant to subparagraph (B) or
          (C) of section 403(b)(2) (as in effect on September 30, 1995), as
          reported by the State on ACF Form 231;
            `(II) the Federal share of administrative expenditures (including
          administrative expenditures for the development of management
          information systems) for the fiscal year, as reported by the State
          on ACF Form 231;
            `(III) the Federal share of emergency assistance expenditures for
          the fiscal year, as reported by the State on ACF Form 231;
            `(IV) the Federal share of expenditures for the fiscal year with
          respect to child care pursuant to subsections (g) and (i) of former
          section 402 (as in effect on September 30, 1995), as reported by 
          the State on ACF Form 231; and
            `(V) the Federal obligations made to the State under section 403
          for the fiscal year with respect to the State program operated 
          under part F (as in effect on September 30, 1995), as determined by
          the Secretary, including additional obligations or reductions in
          obligations made after the close of the fiscal year; and
                        `(ii) in the case of a State to which section 1108
                      applies, the lesser of--
            `(I) the sum described in clause (i); or
            `(II) the total amount certified by the Secretary under former
          section 403 (as in effect during the fiscal year) with respect to
          the territory.
                    `(D) INFORMATION TO BE USED IN DETERMINING AMOUNTS- 
                        `(i) FOR FISCAL YEARS 1992 AND 1993- 
            `(I) In determining the amounts described in subclauses (I)
          through (IV) of subparagraph (C)(i) for any State for each of 
          fiscal years 1992 and 1993, the Secretary shall use information
          available as of April 28, 1995.
            `(II) In determining the amount described in subparagraph
          (C)(i)(V) for any State for each of fiscal years 1992 and 1993, the
          Secretary shall use information available as of January 6, 1995.
                        `(ii) FOR FISCAL YEAR 1994- In determining the 
                      amounts described in subparagraph (C)(i) for any State
                      for fiscal year 1994, the Secretary shall use
                      information available as of April 28, 1995.
                        `(iii) FOR FISCAL YEAR 1995- 
            `(I) In determining the amount described in subparagraph
          (B)(ii)(II) for any State for fiscal year 1995, the Secretary shall
          use the information which was reported by the States and estimates
          made by the States with respect to emergency assistance 
          expenditures and was available as of August 11, 1995.
            `(II) In determining the amounts described in subclauses (I)
          through (III) of subparagraph (C)(i) for any State for fiscal year
          1995, the Secretary shall use information available as of October 
          2, 1995.
            `(III) In determining the amount described in subparagraph
          (C)(i)(IV) for any State for fiscal year 1995, the Secretary shall
          use information available as of February 28, 1996.
            `(IV) In determining the amount described in subparagraph
          (C)(i)(V) for any State for fiscal year 1995, the Secretary shall
          use information available as of October 5, 1995.
                    `(E) APPROPRIATION- Out of any money in the Treasury of
                  the United States not otherwise appropriated, there are
                  appropriated for fiscal years 1996, 1997, 1998, 1999, 2000,
                  2001, and 2002 such sums as are necessary for grants under
                  this paragraph.
                `(2) BONUS TO REWARD DECREASE IN ILLEGITIMACY- 
                    `(A) IN GENERAL- Each eligible State shall be entitled to
                  receive from the Secretary a grant for each bonus year for
                  which the State demonstrates a net decrease in
                  out-of-wedlock births.
                    `(B) AMOUNT OF GRANT- 
                        `(i) IF 5 ELIGIBLE STATES- If there are 5 eligible
                      States for a bonus year, the amount of the grant shall
                      be $20,000,000.
                        `(ii) IF FEWER THAN 5 ELIGIBLE STATES- If there are
                      fewer than 5 eligible States for a bonus year, the
                      amount of the grant shall be $25,000,000.
                    `(C) DEFINITIONS- As used in this paragraph:
                        `(i) ELIGIBLE STATE- 
            `(I) IN GENERAL- The term `eligible State' means a State that the
          Secretary determines meets the following requirements:
            `(aa) The State demonstrates that the number of out-of-wedlock
          births that occurred in the State during the most recent 2-year
          period for which such information is available decreased as 
          compared to the number of such births that occurred during the
          previous 2-year period, and the magnitude of the decrease for the
          State for the period is not exceeded by the magnitude of the
          corresponding decrease for 5 or more other States for the period.
            `(bb) The rate of induced pregnancy terminations in the State for
          the fiscal year is less than the rate of induced pregnancy
          terminations in the State for fiscal year 1995.
            `(II) DISREGARD OF CHANGES IN DATA DUE TO CHANGED REPORTING
          METHODS- In making the determination required by subclause (I), the
          Secretary shall disregard--
            `(aa) any difference between the number of out-of-wedlock births
          that occurred in a State for a fiscal year and the number of
          out-of-wedlock births that occurred in a State for fiscal year 1995
          which is attributable to a change in State methods of reporting 
          data used to calculate the number of out-of-wedlock births; and
            `(bb) any difference between the rate of induced pregnancy
          terminations in a State for a fiscal year and such rate for fiscal
          year 1995 which is attributable to a change in State methods of
          reporting data used to calculate such rate.
                        `(ii) BONUS YEAR- The term `bonus year' means fiscal
                      years 1999, 2000, 2001, and 2002.
                    `(D) APPROPRIATION- Out of any money in the Treasury of
                  the United States not otherwise appropriated, there are
                  appropriated for fiscal years 1999 through 2002, such sums
                  as are necessary for grants under this paragraph.
                `(3) SUPPLEMENTAL GRANT FOR POPULATION INCREASES IN CERTAIN
              STATES-
                    `(A) IN GENERAL- Each qualifying State shall, subject to
                  subparagraph (F), be entitled to receive from the Secretary--
                        `(i) for fiscal year 1998 a grant in an amount equal
                      to 2.5 percent of the total amount required to be paid
                      to the State under former section 403 (as in effect
                      during fiscal year 1994) for fiscal year 1994; and
                        `(ii) for each of fiscal years 1999, 2000, and 2001, 
                      a grant in an amount equal to the sum of--
            `(I) the amount (if any) required to be paid to the State under
          this paragraph for the immediately preceding fiscal year; and
            `(II) 2.5 percent of the sum of--
            `(aa) the total amount required to be paid to the State under
          former section 403 (as in effect during fiscal year 1994) for 
          fiscal year 1994; and
            `(bb) the amount (if any) required to be paid to the State under
          this paragraph for the fiscal year preceding the fiscal year for
          which the grant is to be made.
                    `(B) PRESERVATION OF GRANT WITHOUT INCREASES FOR STATES
                  FAILING TO REMAIN QUALIFYING STATES- Each State that is not
                  a qualifying State for a fiscal year specified in
                  subparagraph (A)(ii) but was a qualifying State for a prior
                  fiscal year shall, subject to subparagraph (F), be entitled
                  to receive from the Secretary for the specified fiscal 
                  year, a grant in an amount equal to the amount required to
                  be paid to the State under this paragraph for the most
                  recent fiscal year for which the State was a qualifying
                  State.
                    `(C) QUALIFYING STATE- 
                        `(i) IN GENERAL- For purposes of this paragraph, a
                      State is a qualifying State for a fiscal year if--
            `(I) the level of welfare spending per poor person by the State
          for the immediately preceding fiscal year is less than the national
          average level of State welfare spending per poor person for such
          preceding fiscal year; and
            `(II) the population growth rate of the State (as determined by
          the Bureau of the Census) for the most recent fiscal year for which
          information is available exceeds the average population growth rate
          for all States (as so determined) for such most recent fiscal year.
                        `(ii) STATE MUST QUALIFY IN FISCAL YEAR 1997-
                      Notwithstanding clause (i), a State shall not be a
                      qualifying State for any fiscal year after 1998 by
                      reason of clause (i) if the State is not a qualifying
                      State for fiscal year 1998 by reason of clause (i).
                        `(iii) CERTAIN STATES DEEMED QUALIFYING STATES- For
                      purposes of this paragraph, a State is deemed to be a
                      qualifying State for fiscal years 1998, 1999, 2000, and
                      2001 if--
            `(I) the level of welfare spending per poor person by the State
          for fiscal year 1994 is less than 35 percent of the national 
          average level of State welfare spending per poor person for fiscal
          year 1994; or
            `(II) the population of the State increased by more than 10
          percent from April 1, 1990 to July 1, 1994, according to the
          population estimates in publication CB94-204 of the Bureau of the
          Census.
                    `(D) DEFINITIONS- As used in this paragraph:
                        `(i) LEVEL OF WELFARE SPENDING PER POOR PERSON- The
                      term `level of State welfare spending per poor person'
                      means, with respect to a State and a fiscal year--
            `(I) the sum of--
            `(aa) the total amount required to be paid to the State under
          former section 403 (as in effect during fiscal year 1994) for 
          fiscal year 1994; and
            `(bb) the amount (if any) paid to the State under this paragraph
          for the immediately preceding fiscal year; divided by
            `(II) the number of individuals, according to the 1990 decennial
          census, who were residents of the State and whose income was below
          the poverty line.
                        `(ii) NATIONAL AVERAGE LEVEL OF STATE WELFARE 
                      SPENDING PER POOR PERSON- The term `national average
                      level of State welfare spending per poor person' means,
                      with respect to a fiscal year, an amount equal to--
            `(I) the total amount required to be paid to the States under
          former section 403 (as in effect during fiscal year 1994) for 
          fiscal year 1994; divided by
            `(II) the number of individuals, according to the 1990 decennial
          census, who were residents of any State and whose income was below
          the poverty line.
                        `(iii) STATE- The term `State' means each of the 50
                      States of the United States and the District of Columbia.
                    `(E) APPROPRIATION- Out of any money in the Treasury of
                  the United States not otherwise appropriated, there are
                  appropriated for fiscal years 1998, 1999, 2000, and 2001
                  such sums as are necessary for grants under this paragraph,
                  in a total amount not to exceed $800,000,000.
                    `(F) GRANTS REDUCED PRO RATA IF INSUFFICIENT
                  APPROPRIATIONS- If the amount appropriated pursuant to this
                  paragraph for a fiscal year is less than the total amount 
                  of payments otherwise required to be made under this
                  paragraph for the fiscal year, then the amount otherwise
                  payable to any State for the fiscal year under this
                  paragraph shall be reduced by a percentage equal to the
                  amount so appropriated divided by such total amount.
                    `(G) BUDGET SCORING- Notwithstanding section 257(b)(2) of
                  the Balanced Budget and Emergency Deficit Control Act of
                  1985, the baseline shall assume that no grant shall be made
                  under this paragraph after fiscal year 2001.
                `(4) BONUS TO REWARD HIGH PERFORMANCE STATES- 
                    `(A) IN GENERAL- The Secretary shall make a grant 
                  pursuant to this paragraph to each State for each bonus 
                  year for which the State is a high performing State.
                    `(B) AMOUNT OF GRANT- 
                        `(i) IN GENERAL- Subject to clause (ii) of this
                      subparagraph, the Secretary shall determine the amount
                      of the grant payable under this paragraph to a high
                      performing State for a bonus year, which shall be based
                      on the score assigned to the State under subparagraph
                      (D)(i) for the fiscal year that immediately precedes 
                      the bonus year.
                        `(ii) LIMITATION- The amount payable to a State under
                      this paragraph for a bonus year shall not exceed 5
                      percent of the State family assistance grant.
                    `(C) FORMULA FOR MEASURING STATE PERFORMANCE- Not later
                  than 1 year after the date of the enactment of the Personal
                  Responsibility and Work Opportunity Reconciliation Act of
                  1996, the Secretary, in consultation with the National
                  Governors' Association and the American Public Welfare
                  Association, shall develop a formula for measuring State
                  performance in operating the State program funded under 
                  this part so as to achieve the goals set forth in section
                  401(a).
                    `(D) SCORING OF STATE PERFORMANCE; SETTING OF PERFORMANCE
                  THRESHOLDS- For each bonus year, the Secretary shall--
                        `(i) use the formula developed under subparagraph (C)
                      to assign a score to each eligible State for the fiscal
                      year that immediately precedes the bonus year; and
                        `(ii) prescribe a performance threshold in such a
                      manner so as to ensure that--
            `(I) the average annual total amount of grants to be made under
          this paragraph for each bonus year equals $200,000,000; and
            `(II) the total amount of grants to be made under this paragraph
          for all bonus years equals $1,000,000,000.
                    `(E) DEFINITIONS- As used in this paragraph:
                        `(i) BONUS YEAR- The term `bonus year' means fiscal
                      years 1999, 2000, 2001, 2002, and 2003.
                        `(ii) HIGH PERFORMING STATE- The term `high 
                      performing State' means, with respect to a bonus year,
                      an eligible State whose score assigned pursuant to
                      subparagraph (D)(i) for the fiscal year immediately
                      preceding the bonus year equals or exceeds the
                      performance threshold prescribed under subparagraph
                      (D)(ii) for such preceding fiscal year.
                    `(F) APPROPRIATION- Out of any money in the Treasury of
                  the United States not otherwise appropriated, there are
                  appropriated for fiscal years 1999 through 2003
                  $1,000,000,000 for grants under this paragraph.
            `(b) CONTINGENCY FUND- 
                `(1) ESTABLISHMENT- There is hereby established in the
              Treasury of the United States a fund which shall be known as 
              the `Contingency Fund for State Welfare Programs' (in this
              section referred to as the `Fund').
                `(2) DEPOSITS INTO FUND- Out of any money in the Treasury of
              the United States not otherwise appropriated, there are
              appropriated for fiscal years 1997, 1998, 1999, 2000, and 2001
              such sums as are necessary for payment to the Fund in a total
              amount not to exceed $2,000,000,000.
                `(3) GRANTS- 
                    `(A) PROVISIONAL PAYMENTS- If an eligible State submits 
                  to the Secretary a request for funds under this paragraph
                  during an eligible month, the Secretary shall, subject to
                  this paragraph, pay to the State, from amounts appropriated
                  pursuant to paragraph (2), an amount equal to the amount of
                  funds so requested.
                    `(B) PAYMENT PRIORITY- The Secretary shall make payments
                  under subparagraph (A) in the order in which the Secretary
                  receives requests for such payments.
                    `(C) LIMITATIONS- 
                        `(i) MONTHLY PAYMENT TO A STATE- The total amount 
                      paid to a single State under subparagraph (A) during a
                      month shall not exceed  1/12  of 20 percent of the 
                      State family assistance grant.
                        `(ii) PAYMENTS TO ALL STATES- The total amount paid 
                      to all States under subparagraph (A) during fiscal 
                      years 1997 through 2001 shall not exceed the total
                      amount appropriated pursuant to paragraph (2).
                `(4) ANNUAL RECONCILIATION- Notwithstanding paragraph (3), at
              the end of each fiscal year, each State shall remit to the
              Secretary an amount equal to the amount (if any) by which the
              total amount paid to the State under paragraph (3) during the
              fiscal year  exceeds--
                    `(A) the Federal medical assistance percentage for the
                  State for the fiscal year (as defined in section 1905(b), 
                  as in effect on September 30, 1995) of the amount (if any)
                  by which--
                        `(i) if the Secretary makes a payment to the State
                      under section 418(a)(2) in the fiscal year--
            `(I) the expenditures under the State program funded under this
          part for the fiscal year, excluding any amounts made available by
          the Federal Government (except amounts paid to the State under
          paragraph (3) during the fiscal year that have been expended by the
          State) and any amounts expended by the State during the fiscal year
          for child care; exceeds
            `(II) historic State expenditures (as defined in section
          409(a)(7)(B)(iii)), excluding the expenditures by the State for
          child care under subsection (g) or (i) of section 402 (as in effect
          during fiscal year 1994) for fiscal year 1994 minus any Federal
          payment with respect to such child care expenditures; or
                        `(ii) if the Secretary does not make a payment to the
                      State under section 418(a)(2) in the fiscal year--
            `(I) the expenditures under the State program funded under this
          part for the fiscal year (excluding any amounts made available by
          the Federal Government, except amounts paid to the State under
          paragraph (3) during the fiscal year that have been expended by the
          State); exceeds
            `(II) historic State expenditures (as defined in section
          409(a)(7)(B)(iii)); multiplied by
                    `(B)  1/12  times the number of months during the fiscal
                  year for which the Secretary makes a payment to the State
                  under this subsection.
                `(5) ELIGIBLE MONTH- As used in paragraph (3)(A), the term
              `eligible month' means, with respect to a State, a month in the
              2-month period that begins with any month for which the State 
              is a needy State.
                `(6) NEEDY STATE- For purposes of paragraph (5), a State is a
              needy State for a month if--
                    `(A) the average rate of--
                        `(i) total unemployment in such State (seasonally
                      adjusted) for the period consisting of the most recent 
                      3 months for which data for all States are published
                      equals or exceeds 6.5 percent; and
                        `(ii) total unemployment in such State (seasonally
                      adjusted) for the 3-month period equals or exceeds 110
                      percent of such average rate for either (or both) of 
                      the corresponding 3-month periods ending in the 2
                      preceding calendar years; or
                    `(B) as determined by the Secretary of Agriculture (in 
                  the discretion of the Secretary of Agriculture), the 
                  monthly average number of individuals (as of the last day 
                  of each month) participating in the food stamp program in
                  the State in the then most recently concluded 3-month 
                  period for which data are available exceeds by not less 
                  than 10 percent the lesser of--
                        `(i) the monthly average number of individuals (as of
                      the last day of each month) in the State that would 
                      have participated in the food stamp program in the
                      corresponding 3-month period in fiscal year 1994 if the
                      amendments made by titles IV and VIII of the Personal
                      Responsibility and Work Opportunity Reconciliation Act
                      of 1996 had been in effect throughout fiscal year 1994;
                      or
                        `(ii) the monthly average number of individuals (as 
                      of the last day of each month) in the State that would
                      have participated in the food stamp program in the
                      corresponding 3-month period in fiscal year 1995 if the
                      amendments made by titles IV and VIII of the Personal
                      Responsibility and Work Opportunity Reconciliation Act
                      of 1996 had been in effect throughout fiscal year 1995.
                `(7) OTHER TERMS DEFINED- As used in this subsection:
                    `(A) STATE- The term `State' means each of the 50 States
                  of the United States and the District of Columbia.
                    `(B) SECRETARY- The term `Secretary' means the Secretary
                  of the Treasury.
                `(8) ANNUAL REPORTS- The Secretary shall annually report to
              the Congress on the status of the Fund.
          `SEC. 404. USE OF GRANTS.
            `(a) GENERAL RULES- Subject to this part, a State to which a 
          grant is made under section 403 may use the grant--
                `(1) in any manner that is reasonably calculated to 
              accomplish the purpose of this part, including to provide low
              income households with assistance in meeting home heating and
              cooling costs; or
                `(2) in any manner that the State was authorized to use
              amounts received under part A or F, as such parts were in 
              effect on September 30, 1995.
            `(b) LIMITATION ON USE OF GRANT FOR ADMINISTRATIVE PURPOSES- 
                `(1) LIMITATION- A State to which a grant is made under
              section 403 shall not expend more than 15 percent of the grant
              for administrative purposes.
                `(2) EXCEPTION- Paragraph (1) shall not apply to the use of a
              grant for information technology and computerization needed for
              tracking or monitoring required by or under this part.
            `(c) AUTHORITY TO TREAT INTERSTATE IMMIGRANTS UNDER RULES OF
          FORMER STATE- A State operating a program funded under this part 
          may apply to a family the rules (including benefit amounts) of the
          program funded under this part of another State if the family has
          moved to the State from the other State and has resided in the 
          State for less than 12 months.
            `(d) AUTHORITY TO USE PORTION OF GRANT FOR OTHER PURPOSES- 
                `(1) IN GENERAL- A State may use not more than 30 percent of
              the amount of any grant made to the State under section 403(a)
              for a fiscal year to carry out a State program pursuant to any
              or all of the following provisions of law:
                    `(A) Title XX of this Act.
                    `(B) The Child Care and Development Block Grant Act of
                  1990.
                `(2) LIMITATION ON AMOUNT TRANSFERABLE TO TITLE XX PROGRAMS-
              Notwithstanding paragraph (1), not more than  1/3  of the total
              amount paid to a State under this part for a fiscal year that 
              is used to carry out State programs pursuant to provisions of
              law specified in paragraph (1) may be used to carry out State
              programs pursuant to title XX.
                `(3) APPLICABLE RULES- 
                    `(A) IN GENERAL- Except as provided in subparagraph (B) 
                  of this paragraph, any amount paid to a State under this
                  part that is used to carry out a State program pursuant to 
                  a provision of law specified in paragraph (1) shall not be
                  subject to the requirements of this part, but shall be
                  subject to the requirements that apply to Federal funds
                  provided directly under the provision of law to carry out
                  the program, and the expenditure of any amount so used 
                  shall not be considered to be an expenditure under this part.
                    `(B) EXCEPTION RELATING TO TITLE XX PROGRAMS- All amounts
                  paid to a State under this part that are used to carry out
                  State programs pursuant to title XX shall be used only for
                  programs and services to children or their families whose
                  income is less than 200 percent of the income 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.
            `(e) AUTHORITY TO RESERVE CERTAIN AMOUNTS FOR ASSISTANCE- A State
          may reserve amounts paid to the State under this part for any 
          fiscal year for the purpose of providing, without fiscal year
          limitation, assistance under the State program funded under this
          part.
            `(f) AUTHORITY TO OPERATE EMPLOYMENT PLACEMENT PROGRAM- A State 
          to which a grant is made under section 403 may use the grant to 
          make payments (or provide job placement vouchers) to State-approved
          public and private job placement agencies that provide employment
          placement services to individuals who receive assistance under the
          State program funded under this part.
            `(g) IMPLEMENTATION OF ELECTRONIC BENEFIT TRANSFER SYSTEM- A 
          State to which a grant is made under section 403 is encouraged to
          implement an electronic benefit transfer system for providing
          assistance under the State program funded under this part, and may
          use the grant for such purpose.
            `(h) USE OF FUNDS FOR INDIVIDUAL DEVELOPMENT ACCOUNTS- 
                `(1) IN GENERAL- A State to which a grant is made under
              section 403 may use the grant to carry out a program to fund
              individual development accounts (as defined in paragraph (2))
              established by individuals eligible for assistance under the
              State program funded under this part.
                `(2) INDIVIDUAL DEVELOPMENT ACCOUNTS- 
                    `(A) ESTABLISHMENT- Under a State program carried out
                  under paragraph (1), an individual development account may
                  be established by or on behalf of an individual eligible 
                  for assistance under the State program operated under this
                  part for the purpose of enabling the individual to
                  accumulate funds for a qualified purpose described in
                  subparagraph (B).
                    `(B) QUALIFIED PURPOSE- A qualified purpose described in
                  this subparagraph is 1 or more of the following, as 
                  provided by the qualified entity providing assistance to 
                  the individual under this subsection:
                        `(i) POSTSECONDARY EDUCATIONAL EXPENSES- 
                      Postsecondary educational expenses paid from an
                      individual development account directly to an eligible
                      educational institution.
                        `(ii) FIRST HOME PURCHASE- Qualified acquisition 
                      costs with respect to a qualified principal residence
                      for a qualified first-time homebuyer, if paid from an
                      individual development account directly to the persons
                      to whom the amounts are due.
                        `(iii) BUSINESS CAPITALIZATION- Amounts paid from an
                      individual development account directly to a business
                      capitalization account which is established in a
                      federally insured financial institution and is
                      restricted to use solely for qualified business
                      capitalization expenses.
                    `(C) CONTRIBUTIONS TO BE FROM EARNED INCOME- An 
                  individual may only contribute to an individual development
                  account such amounts as are derived from earned income, as
                  defined in section 911(d)(2) of the Internal Revenue Code 
                  of 1986.
                    `(D) WITHDRAWAL OF FUNDS- The Secretary shall establish
                  such regulations as may be necessary to ensure that funds
                  held in an individual development account are not withdrawn
                  except for 1 or more of the qualified purposes described in
                  subparagraph (B).
                `(3) REQUIREMENTS- 
                    `(A) IN GENERAL- An individual development account
                  established under this subsection shall be a trust created
                  or organized in the United States and funded through
                  periodic contributions by the establishing individual and
                  matched by or through a qualified entity for a qualified
                  purpose (as described in paragraph (2)(B)).
                    `(B) QUALIFIED ENTITY- As used in this subsection, the
                  term `qualified entity' means--
                        `(i) a not-for-profit organization described in
                      section 501(c)(3) of the Internal Revenue Code of 1986
                      and exempt from taxation under section 501(a) of such
                      Code; or
                        `(ii) a State or local government agency acting in
                      cooperation with an organization described in clause (i).
                `(4) NO REDUCTION IN BENEFITS- Notwithstanding any other
              provision of Federal law (other than the Internal Revenue Code
              of 1986) that requires consideration of 1 or more financial
              circumstances of an individual, for the purpose of determining
              eligibility to receive, or the amount of, any assistance or
              benefit authorized by such law to be provided to or for the
              benefit of such individual, funds (including interest accruing)
              in an individual development account under this subsection 
              shall be disregarded for such purpose with respect to any 
              period during which such individual maintains or makes
              contributions into such an account.
                `(5) DEFINITIONS- As used in this subsection--
                    `(A) ELIGIBLE EDUCATIONAL INSTITUTION- The term `eligible
                  educational institution' means the following:
                        `(i) An institution described in section 481(a)(1) or
                      1201(a) of the Higher Education Act of 1965 (20 U.S.C.
                      1088(a)(1) or 1141(a)), as such sections are in effect
                      on the date of the enactment of this subsection.
                        `(ii) An area vocational education school (as defined
                      in subparagraph (C) or (D) of section 521(4) of the 
                      Carl D. Perkins Vocational and Applied Technology
                      Education Act (20 U.S.C. 2471(4))) which is in any 
                      State (as defined in section 521(33) of such Act), as
                      such sections are in effect on the date of the 
                      enactment of this subsection.
                    `(B) POST-SECONDARY EDUCATIONAL EXPENSES- The term
                  `post-secondary educational expenses' means--
                        `(i) tuition and fees required for the enrollment or
                      attendance of a student at an eligible educational
                      institution, and
                        `(ii) fees, books, supplies, and equipment required
                      for courses of instruction at an eligible educational
                      institution.
                    `(C) QUALIFIED ACQUISITION COSTS- The term `qualified
                  acquisition costs' means the costs of acquiring,
                  constructing, or reconstructing a residence. The term
                  includes any usual or reasonable settlement, financing, or
                  other closing costs.
                    `(D) QUALIFIED BUSINESS- The term `qualified business'
                  means any business that does not contravene any law or
                  public policy (as determined by the Secretary).
                    `(E) QUALIFIED BUSINESS CAPITALIZATION EXPENSES- The term
                  `qualified business capitalization expenses' means 
                  qualified expenditures for the capitalization of a 
                  qualified business pursuant to a qualified plan.
                    `(F) QUALIFIED EXPENDITURES- The term `qualified
                  expenditures' means expenditures included in a qualified
                  plan, including capital, plant, equipment, working capital,
                  and inventory expenses.
                    `(G) QUALIFIED FIRST-TIME HOMEBUYER- 
                        `(i) IN GENERAL- The term `qualified first-time
                      homebuyer' means a taxpayer (and, if married, the
                      taxpayer's spouse) who has no present ownership 
                      interest in a principal residence during the 3-year
                      period ending on the date of acquisition of the
                      principal residence to which this subsection applies.
                        `(ii) DATE OF ACQUISITION- The term `date of
                      acquisition' means the date on which a binding contract
                      to acquire, construct, or reconstruct the principal
                      residence to which this subparagraph applies is entered
                      into.
                    `(H) QUALIFIED PLAN- The term `qualified plan' means a
                  business plan which--
                        `(i) is approved by a financial institution, or by a
                      nonprofit loan fund having demonstrated fiduciary
                      integrity,
                        `(ii) includes a description of services or goods to
                      be sold, a marketing plan, and projected financial
                      statements, and
                        `(iii) may require the eligible individual to obtain
                      the assistance of an experienced entrepreneurial advisor.
                    `(I) QUALIFIED PRINCIPAL RESIDENCE- The term `qualified
                  principal residence' means a principal residence (within 
                  the meaning of section 1034 of the Internal Revenue Code of
                  1986), the qualified acquisition costs of which do not
                  exceed 100 percent of the average area purchase price
                  applicable to such residence (determined in accordance with
                  paragraphs (2) and (3) of section 143(e) of such Code).
            `(i) SANCTION WELFARE RECIPIENTS FOR FAILING TO ENSURE THAT MINOR
          DEPENDENT CHILDREN ATTEND SCHOOL- A State to which a grant is made
          under section 403 shall not be prohibited from sanctioning a family
          that includes an adult who has received assistance under any State
          program funded under this part attributable to funds provided by 
          the Federal Government or under the food stamp program, as defined
          in section 3(h) of the Food Stamp Act of 1977, if such adult fails
          to ensure that the minor dependent children of such adult attend
          school as required by the law of the State in which the minor
          children reside.
            `(j) REQUIREMENT FOR HIGH SCHOOL DIPLOMA OR EQUIVALENT- A State 
          to which a grant is made under section 403 shall not be prohibited
          from sanctioning a family that includes an adult who is older than
          age 20 and younger than age 51 and who has received assistance 
          under any State program funded under this part attributable to 
          funds provided by the Federal Government or under the food stamp
          program, as defined in section 3(h) of the Food Stamp Act of 1977,
          if such adult does not have, or is not working toward attaining, a
          secondary school diploma or its recognized equivalent unless such
          adult has been determined in the judgment of medical, psychiatric,
          or other appropriate professionals to lack the requisite capacity 
          to complete successfully a course of study that would lead to a
          secondary school diploma or its recognized equivalent.
          `SEC. 405. ADMINISTRATIVE PROVISIONS.
            `(a) QUARTERLY- The Secretary shall pay each grant payable to a
          State under section 403 in quarterly installments, subject to this
          section.
            `(b) NOTIFICATION- Not later than 3 months before the payment of
          any such quarterly installment to a State, the Secretary shall
          notify the State of the amount of any reduction determined under
          section 412(a)(1)(B) with respect to the State.
            `(c) COMPUTATION AND CERTIFICATION OF PAYMENTS TO STATES- 
                `(1) COMPUTATION- The Secretary shall estimate the amount to
              be paid to each eligible State for each quarter under this 
              part, such estimate to be based on a report filed by the State
              containing an estimate by the State of the total sum to be
              expended by the State in the quarter under the State program
              funded under this part and such other information as the
              Secretary may find necessary.
                `(2) CERTIFICATION- The Secretary of Health and Human 
              Services shall certify to the Secretary of the Treasury the
              amount estimated under paragraph (1) with respect to a State,
              reduced or increased to the extent of any overpayment or
              underpayment which the Secretary of Health and Human Services
              determines was made under this part to the State for any prior
              quarter and with respect to which adjustment has not been made
              under this paragraph.
            `(d) PAYMENT METHOD- Upon receipt of a certification under
          subsection (c)(2) with respect to a State, the Secretary of the
          Treasury shall, through the Fiscal Service of the Department of the
          Treasury and before audit or settlement by the General Accounting
          Office, pay to the State, at the time or times fixed by the
          Secretary of Health and Human Services, the amount so certified.
          `SEC. 406. FEDERAL LOANS FOR STATE WELFARE PROGRAMS.
            `(a) LOAN AUTHORITY- 
                `(1) IN GENERAL- The Secretary shall make loans to any
              loan-eligible State, for a period to maturity of not more than 
              3 years.
                `(2) LOAN-ELIGIBLE STATE- As used in paragraph (1), the term
              `loan-eligible State' means a State against which a penalty has
              not been imposed under section 409(a)(1).
            `(b) RATE OF INTEREST- The Secretary shall charge and collect
          interest on any loan made under this section at a rate equal to the
          current average market yield on outstanding marketable obligations
          of the United States with remaining periods to maturity comparable
          to the period to maturity of the loan.
            `(c) USE OF LOAN- A State shall use a loan made to the State 
          under this section only for any purpose for which grant amounts
          received by the State under section 403(a) may be used, including--
                `(1) welfare anti-fraud activities; and
                `(2) the provision of assistance under the State program to
              Indian families that have moved from the service area of an
              Indian tribe with a tribal family assistance plan approved 
              under section 412.
            `(d) LIMITATION ON TOTAL AMOUNT OF LOANS TO A STATE- The
          cumulative dollar amount of all loans made to a State under this
          section during fiscal years 1997 through 2002 shall not exceed 10
          percent of the State family assistance grant.
            `(e) LIMITATION ON TOTAL AMOUNT OF OUTSTANDING LOANS- The total
          dollar amount of loans outstanding under this section may not 
          exceed $1,700,000,000.
            `(f) APPROPRIATION- Out of any money in the Treasury of the 
          United States not otherwise appropriated, there are appropriated
          such sums as may be necessary for the cost of loans under this
          section.
          `SEC. 407. MANDATORY WORK REQUIREMENTS.
            `(a) PARTICIPATION RATE REQUIREMENTS- 
                `(1) ALL FAMILIES- A State to which a grant is made under
              section 403 for a fiscal year shall achieve the minimum
              participation rate specified in the following table for the
              fiscal year with respect to all families receiving assistance
              under the State program funded under this part:
          -- [Bold->] The minimum [<-Bold] 
          -- [Bold->] participation [<-Bold] 
           [Bold->] `If the fiscal year is: [<-Bold] 
          -- [Bold->] rate is: [<-Bold] 
          1997
          --25 
          1998
          --30 
          1999
          --35 
          2000
          --40 
          2001
          --45 
          2002 or thereafter
          --50. 
                `(2) 2-PARENT FAMILIES- A State to which a grant is made 
              under section 403 for a fiscal year shall achieve the minimum
              participation rate specified in the following table for the
              fiscal year with respect to 2-parent families receiving
              assistance under the State program funded under this part:
          -- [Bold->] The minimum [<-Bold] 
          -- [Bold->] participation [<-Bold] 
           [Bold->] `If the fiscal year is: [<-Bold] 
          -- [Bold->] rate is: [<-Bold] 
          1997
          --75 
          1998
          --75 
          1999 or thereafter
          --90. 
            `(b) CALCULATION OF PARTICIPATION RATES- 
                `(1) ALL FAMILIES- 
                    `(A) AVERAGE MONTHLY RATE- For purposes of subsection
                  (a)(1), the participation rate for all families of a State
                  for a fiscal year is the average of the participation rates
                  for all families of the State for each month in the fiscal
                  year.
                    `(B) MONTHLY PARTICIPATION RATES- The participation rate
                  of a State for all families of the State for a month,
                  expressed as a percentage, is--
                        `(i) the number of families receiving assistance 
                      under the State program funded under this part that
                      include an adult or a minor child head of household who
                      is engaged in work for the month; divided by
                        `(ii) the amount by which--
            `(I) the number of families receiving such assistance during the
          month that include an adult or a minor child head of household
          receiving such assistance; exceeds
            `(II) the number of families receiving such assistance that are
          subject in such month to a penalty described in subsection (e)(1)
          but have not been subject to such penalty for more than 3 months
          within the preceding 12-month period (whether or not consecutive).
                `(2) 2-PARENT FAMILIES- 
                    `(A) AVERAGE MONTHLY RATE- For purposes of subsection
                  (a)(2), the participation rate for 2-parent families of a
                  State for a fiscal year is the average of the participation
                  rates for 2-parent families of the State for each month in
                  the fiscal year.
                    `(B) MONTHLY PARTICIPATION RATES- The participation rate
                  of a State for 2-parent families of the State for a month
                  shall be calculated by use of the formula set forth in
                  paragraph (1)(B), except that in the formula the term
                  `number of 2-parent families' shall be substituted for the
                  term `number of families' each place such latter term
                  appears.
                `(3) PRO RATA REDUCTION OF PARTICIPATION RATE DUE TO CASELOAD
              REDUCTIONS NOT REQUIRED BY FEDERAL LAW-
                    `(A) IN GENERAL- The Secretary shall prescribe 
                  regulations for reducing the minimum participation rate
                  otherwise required by this section for a fiscal year by the
                  number of percentage points equal to the number of
                  percentage points (if any) by which--
                        `(i) the average monthly number of families receiving
                      assistance during the immediately preceding fiscal year
                      under the State program funded under this part is less
                      than
                        `(ii) the average monthly number of families that
                      received aid under the State plan approved under part A
                      (as in effect on September 30, 1995) during fiscal year
                      1995.
                  The minimum participation rate shall not be reduced to the
                  extent that the Secretary determines that the reduction in
                  the number of families receiving such assistance is 
                  required by Federal law.
                    `(B) ELIGIBILITY CHANGES NOT COUNTED- The regulations
                  required by subparagraph (A) shall not take into account
                  families that are diverted from a State program funded 
                  under this part as a result of differences in eligibility
                  criteria under a State program funded under this part and
                  eligibility criteria under the State program operated under
                  the State plan approved under part A (as such plan and such
                  part were in effect on September 30, 1995). Such 
                  regulations shall place the burden on the Secretary to 
                  prove that such families were diverted as a direct result 
                  of differences in such eligibility criteria.
                `(4) STATE OPTION TO INCLUDE INDIVIDUALS RECEIVING ASSISTANCE
              UNDER A TRIBAL FAMILY ASSISTANCE PLAN- For purposes of
              paragraphs (1)(B) and (2)(B), a State may, at its option,
              include families in the State that are receiving assistance
              under a tribal family assistance plan approved under section 412.
                `(5) STATE OPTION FOR PARTICIPATION REQUIREMENT EXEMPTIONS-
              For any fiscal year, a State may, at its option, not require an
              individual who is a single custodial parent caring for a child
              who has not attained 12 months of age to engage in work, and 
              may disregard such an individual in determining the
              participation rates under subsection (a) for not more than 12
              months.
            `(c) ENGAGED IN WORK- 
                `(1) GENERAL RULES- 
                    `(A) ALL FAMILIES- For purposes of subsection
                  (b)(1)(B)(i), a recipient is engaged in work for a month in
                  a fiscal year if the recipient is participating in work
                  activities for at least the minimum average number of hours
                  per week specified in the following table during the month,
                  not fewer than 20 hours per week of which are attributable
                  to an activity described in paragraph (1), (2), (3), (4),
                  (5), (6), (7), (8), or (12) of subsection (d), subject to
                  this subsection:
           [Bold->]    [<-Bold] 
          -- [Bold->] The minimum [<-Bold] 
           [Bold->]  `If the month is [<-Bold] 
          -- [Bold->] average number of [<-Bold] 
           [Bold->]   in fiscal year: [<-Bold] 
          -- [Bold->] hours per week is: [<-Bold] 
           1997
          --20 
           1998
          --20 
           1999
          --25 
           2000 or thereafter
          --30. 
                    `(B) 2-PARENT FAMILIES- For purposes of subsection
                  (b)(2)(B), an individual is engaged in work for a month in 
                  a fiscal year if--
                        `(i) the individual is making progress in work
                      activities for at least 35 hours per week during the
                      month, not fewer than 30 hours per week of which are
                      attributable to an activity described in paragraph (1),
                      (2), (3), (4), (5), (6), (7), (8), or (12) of 
                      subsection (d), subject to this subsection; and
                        `(ii) if the family of the individual receives
                      federally-funded child care assistance and an adult in
                      the family is not disabled or caring for a severely
                      disabled child, the individual's spouse is making
                      progress in work activities during the month, not fewer
                      than 20 hours per week of which are attributable to an
                      activity described in paragraph (1), (2), (3), (4), 
                      (5), or (7) of subsection (d).
                `(2) LIMITATIONS AND SPECIAL RULES- 
                    `(A) NUMBER OF WEEKS FOR WHICH JOB SEARCH COUNTS AS WORK- 
                        `(i) LIMITATION- Notwithstanding paragraph (1) of 
                      this subsection, an individual shall not be considered
                      to be engaged in work by virtue of participation in an
                      activity described in subsection (d)(6) of a State
                      program funded under this part, after the individual 
                      has participated in such an activity for 6 weeks (or, 
                      if the unemployment rate of the State is at least 50
                      percent greater than the unemployment rate of the 
                      United States, 12 weeks), or if the participation is 
                      for a week that immediately follows 4 consecutive weeks
                      of such participation.
                        `(ii) LIMITED AUTHORITY TO COUNT LESS THAN FULL WEEK
                      OF PARTICIPATION- For purposes of clause (i) of this
                      subparagraph, on not more than 1 occasion per
                      individual, the State shall consider participation of
                      the individual in an activity described in subsection
                      (d)(6) for 3 or 4 days during a week as a week of
                      participation in the activity by the individual.
                    `(B) SINGLE PARENT WITH CHILD UNDER AGE 6 DEEMED TO BE
                  MEETING WORK PARTICIPATION REQUIREMENTS IF PARENT IS 
                  ENGAGED IN WORK FOR 20 HOURS PER WEEK- For purposes of
                  determining monthly participation rates under subsection
                  (b)(1)(B)(i), a recipient in a 1-parent family who is the
                  parent of a child who has not attained 6 years of age is
                  deemed to be engaged in work for a month if the recipient 
                  is engaged in work for an average of at least 20 hours per
                  week during the month.
                    `(C) TEEN HEAD OF HOUSEHOLD WHO MAINTAINS SATISFACTORY
                  SCHOOL ATTENDANCE DEEMED TO BE MEETING WORK PARTICIPATION
                  REQUIREMENTS- For purposes of determining monthly
                  participation rates under sub-section (b)(1)(B)(i), a
                  recipient who is a single head of household and has not
                  attained 20 years of age is deemed, subject to subparagraph
                  (D) of this paragraph, to be engaged in work for a month in
                  a fiscal year if the recipient--
                        `(i) maintains satisfactory attendance at secondary
                      school or the equivalent during the month; or
                        `(ii) participates in education directly related to
                      employment for at least the minimum average number of
                      hours per week specified in the table set forth in
                      paragraph (1)(A) of this subsection.
                    `(D) NUMBER OF PERSONS THAT MAY BE TREATED AS ENGAGED IN
                  WORK BY VIRTUE OF PARTICIPATION IN VOCATIONAL EDUCATION
                  ACTIVITIES OR BEING A TEEN HEAD OF HOUSEHOLD WHO MAINTAINS
                  SATISFACTORY SCHOOL ATTENDANCE- For purposes of determining
                  monthly participation rates under paragraphs (1)(B)(i) and
                  (2)(B) of subsection (b), not more than 20 percent of
                  individuals in all families and in 2-parent families may be
                  determined to be engaged in work in the State for a month 
                  by reason of participation in vocational educational
                  training or deemed to be engaged in work by reason of
                  subparagraph (C) of this paragraph.
            `(d) WORK ACTIVITIES DEFINED- As used in this section, the term
          `work activities' means--
                `(1) unsubsidized employment;
                `(2) subsidized private sector employment;
                `(3) subsidized public sector employment;
                `(4) work experience (including work associated with the
              refurbishing of publicly assisted housing) if sufficient 
              private sector employment is not available;
                `(5) on-the-job training;
                `(6) job search and job readiness assistance;
                `(7) community service programs;
                `(8) vocational educational training (not to exceed 12 months
              with respect to any individual);
                `(9) job skills training directly related to employment;
                `(10) education directly related to employment, in the case 
              of a recipient who has not received a high school diploma or a
              certificate of high school equivalency;
                `(11) satisfactory attendance at secondary school or in a
              course of study leading to a certificate of general 
              equivalence, in the case of a recipient who has not completed
              secondary school or received such a certificate; and
                `(12) the provision of child care services to an individual
              who is participating in a community service program.
            `(e) PENALTIES AGAINST INDIVIDUALS- 
                `(1) IN GENERAL- Except as provided in paragraph (2), if an
              individual in a family receiving assistance under the State
              program funded under this part refuses to engage in work
              required in accordance with this section, the State shall--
                    `(A) reduce the amount of assistance otherwise payable to
                  the family pro rata (or more, at the option of the State)
                  with respect to any period during a month in which the
                  individual so refuses; or
                    `(B) terminate such assistance,
              subject to such good cause and other exceptions as the State 
              may establish.
                `(2) EXCEPTION- Notwithstanding paragraph (1), a State may 
              not reduce or terminate assistance under the State program
              funded under this part based on a refusal of an individual to
              work if the individual is a single custodial parent caring for 
              a child who has not attained 6 years of age, and the individual
              proves that the individual has a demonstrated inability (as
              determined by the State) to obtain needed child care, for 1 or
              more of the following reasons:
                    `(A) Unavailability of appropriate child care within a
                  reasonable distance from the individual's home or work site.
                    `(B) Unavailability or unsuitability of informal child
                  care by a relative or under other arrangements.
                    `(C) Unavailability of appropriate and affordable formal
                  child care arrangements.
            `(f) NONDISPLACEMENT IN WORK ACTIVITIES- 
                `(1) IN GENERAL- Subject to paragraph (2), an adult in a
              family receiving assistance under a State program funded under
              this part attributable to funds provided by the Federal
              Government may fill a vacant employment position in order to
              engage in a work activity described in subsection (d).
                `(2) NO FILLING OF CERTAIN VACANCIES- No adult in a work
              activity described in subsection (d) which is funded, in whole
              or in part, by funds provided by the Federal Government shall 
              be employed or assigned--
                    `(A) when any other individual is on layoff from the same
                  or any substantially equivalent job; or
                    `(B) if the employer has terminated the employment of any
                  regular employee or otherwise caused an involuntary
                  reduction of its workforce in order to fill the vacancy so
                  created with an adult described in paragraph (1).
                `(3) GRIEVANCE PROCEDURE- A State with a program funded under
              this part shall establish and maintain a grievance procedure 
              for resolving complaints of alleged violations of paragraph (2).
                `(4) NO PREEMPTION- Nothing in this subsection shall preempt
              or supersede any provision of State or local law that provides
              greater protection for employees from displacement.
            `(g) SENSE OF THE CONGRESS- It is the sense of the Congress that
          in complying with this section, each State that operates a program
          funded under this part is encouraged to assign the highest priority
          to requiring adults in 2-parent families and adults in 
          single-parent families that include older preschool or school-age
          children to be engaged in work activities.
            `(h) SENSE OF THE CONGRESS THAT STATES SHOULD IMPOSE CERTAIN
          REQUIREMENTS ON NONCUSTODIAL, NONSUPPORTING MINOR PARENTS- It is 
          the sense of the Congress that the States should require
          noncustodial, nonsupporting parents who have not attained 18 years
          of age to fulfill community work obligations and attend appropriate
          parenting or money management classes after school.
            `(i) REVIEW OF IMPLEMENTATION OF STATE WORK PROGRAMS- During
          fiscal year 1999, the Committee on Ways and Means of the House of
          Representatives and the Committee on Finance of the Senate shall
          hold hearings and engage in other appropriate activities to review
          the implementation of this section by the States, and shall invite
          the Governors of the States to testify before them regarding such
          implementation. Based on such hearings, such Committees may
          introduce such legislation as may be appropriate to remedy any
          problems with the State programs operated pursuant to this section.
          `SEC. 408. PROHIBITIONS; REQUIREMENTS.
            `(a) IN GENERAL- 
                `(1) NO ASSISTANCE FOR FAMILIES WITHOUT A MINOR CHILD- A 
              State to which a grant is made under section 403 shall not use
              any part of the grant to provide assistance to a family--
                    `(A) unless the family includes--
                        `(i) a minor child who resides with a custodial 
                      parent or other adult caretaker relative of the child; or
                        `(ii) a pregnant individual; and
                    `(B) if the family includes an adult who has received
                  assistance under any State program funded under this part
                  attributable to funds provided by the Federal Government,
                  for 60 months (whether or not consecutive) after the date
                  the State program funded under this part commences (unless
                  an exception described in subparagraph (B), (C), or (D) of
                  paragraph (7) applies).
                `(2) REDUCTION OR ELIMINATION OF ASSISTANCE FOR 
              NONCOOPERATION IN ESTABLISHING PATERNITY OR OBTAINING CHILD
              SUPPORT- If the agency responsible for administering the State
              plan approved under part D determines that an individual is not
              cooperating with the State in establishing paternity or in
              establishing, modifying, or enforcing a support order with
              respect to a child of the individual, and the individual does
              not qualify for any good cause or other exception established 
              by the State pursuant to section 454(29), then the State--
                    `(A) shall deduct from the assistance that would 
                  otherwise be provided to the family of the individual under
                  the State program funded under this part an amount equal to
                  not less than 25 percent of the amount of such assistance;
                  and
                    `(B) may deny the family any assistance under the State
                  program.
                `(3) NO ASSISTANCE FOR FAMILIES NOT ASSIGNING CERTAIN SUPPORT
              RIGHTS TO THE STATE-
                    `(A) IN GENERAL- A State to which a grant is made under
                  section 403 shall require, as a condition of providing
                  assistance to a family under the State program funded under
                  this part, that a member of the family assign to the State
                  any rights the family member may have (on behalf of the
                  family member or of any other person for whom the family
                  member has applied for or is receiving such assistance) to
                  support from any other person, not exceeding the total
                  amount of assistance so provided to the family, which 
                  accrue (or have accrued) before the date the family leaves
                  the program, which assignment, on and after the date the
                  family leaves the program, shall not apply with respect to
                  any support (other than support collected pursuant to
                  section 464) which accrued before the family received such
                  assistance and which the State has not collected by--
                        `(i) September 30, 2000, if the assignment is 
                      executed on or after October 1, 1997, and before 
                      October 1, 2000; or
                        `(ii) the date the family leaves the program, if the
                      assignment is executed on or after October 1, 2000.
                    `(B) LIMITATION- A State to which a grant is made under
                  section 403 shall not require, as a condition of providing
                  assistance to any family under the State program funded
                  under this part, that a member of the family assign to the
                  State any rights to support described in subparagraph (A)
                  which accrue after the date the family leaves the program.
                `(4) NO ASSISTANCE FOR TEENAGE PARENTS WHO DO NOT ATTEND HIGH
              SCHOOL OR OTHER EQUIVALENT TRAINING PROGRAM- A State to which a
              grant is made under section 403 shall not use any part of the
              grant to provide assistance to an individual who has not
              attained 18 years of age, is not married, has a minor child at
              least 12 weeks of age in his or her care, and has not
              successfully completed a high-school education (or its
              equivalent), if the individual does not participate in--
                    `(A) educational activities directed toward the 
                  attainment of a high school diploma or its equivalent; or
                    `(B) an alternative educational or training program that
                  has been approved by the State.
                `(5) NO ASSISTANCE FOR TEENAGE PARENTS NOT LIVING IN
              ADULT-SUPERVISED SETTINGS-
                    `(A) IN GENERAL- 
                        `(i) REQUIREMENT- Except as provided in subparagraph
                      (B), a State to which a grant is made under section 403
                      shall not use any part of the grant to provide
                      assistance to an individual described in clause (ii) of
                      this subparagraph if the individual and the minor child
                      referred to in clause (ii)(II) do not reside in a place
                      of residence maintained by a parent, legal guardian, or
                      other adult relative of the individual as such 
                      parent's, guardian's, or adult relative's own home.
                        `(ii) INDIVIDUAL DESCRIBED-  For purposes of clause
                      (i), an individual described in this clause is an
                      individual who--
            `(I) has not attained 18 years of age; and
            `(II) is not married, and has a minor child in his or her care.
                    `(B) EXCEPTION- 
                        `(i) PROVISION OF, OR ASSISTANCE IN LOCATING,
                      ADULT-SUPERVISED LIVING ARRANGEMENT- In the case of an
                      individual who is described in clause (ii), the State
                      agency referred to in section 402(a)(4) shall provide,
                      or assist the individual in locating, a second chance
                      home, maternity home, or other appropriate
                      adult-supervised supportive living arrangement, taking
                      into consideration the needs and concerns of the
                      individual, unless the State agency determines that the
                      individual's current living arrangement is appropriate,
                      and thereafter shall require that the individual and 
                      the minor child referred to in subparagraph (A)(ii)(II)
                      reside in such living arrangement as a condition of the
                      continued receipt of assistance under the State program
                      funded under this part  attributable to funds provided
                      by the Federal Government (or in an alternative
                      appropriate arrangement, should circumstances change 
                      and the current arrangement cease to be appropriate).
                        `(ii) INDIVIDUAL DESCRIBED- For purposes of clause
                      (i), an individual is described in this clause if the
                      individual is described in subparagraph (A)(ii), and--
            `(I) the individual has no parent, legal guardian, or other
          appropriate adult relative described in subclause (II) of his or 
          her own who is living or whose whereabouts are known;
            `(II) no living parent, legal guardian, or other appropriate 
          adult relative, who would otherwise meet applicable State criteria
          to act as the individual's legal guardian, of such individual 
          allows the individual to live in the home of such parent, guardian,
          or relative;
            `(III) the State agency determines that--
            `(aa) the individual or the minor child referred to in
          subparagraph (A)(ii)(II) is being or has been subjected to serious
          physical or emotional harm, sexual abuse, or exploitation in the
          residence of the individual's own parent or legal guardian; or
            `(bb) substantial evidence exists of an act or failure to act 
          that presents an imminent or serious harm if the individual and the
          minor child lived in the same residence with the individual's own
          parent or legal guardian; or
            `(IV) the State agency otherwise determines that it is in the 
          best interest of the minor child to waive the requirement of
          subparagraph (A) with respect to the individual or the minor child.
                        `(iii) SECOND-CHANCE HOME- For purposes of this
                      subparagraph, the term `second-chance home' means an
                      entity that provides individuals described in clause
                      (ii) with a supportive and supervised living 
                      arrangement in which such individuals are required to
                      learn parenting skills, including child development,
                      family budgeting, health and nutrition, and other 
                      skills to promote their long-term economic independence
                      and the well-being of their children.
                `(6) NO MEDICAL SERVICES- 
                    `(A) IN GENERAL- A State to which a grant is made under
                  section 403 shall not use any part of the grant to provide
                  medical services.
                    `(B) EXCEPTION FOR PREPREGNANCY FAMILY PLANNING SERVICES-
                  As used in subparagraph (A), the term `medical services'
                  does not include prepregnancy family planning services.
                `(7) NO ASSISTANCE FOR MORE THAN 5 YEARS- 
                    `(A) IN GENERAL- A State to which a grant is made under
                  section 403 shall not use any part of the grant to provide
                  assistance to a family that includes an adult who has
                  received assistance under any State program funded under
                  this part attributable to funds provided by the Federal
                  Government, for 60 months (whether or not consecutive) 
                  after the date the State program funded under this part
                  commences, subject to this paragraph.
                    `(B) MINOR CHILD EXCEPTION- In determining the number of
                  months for which an individual who is a parent or pregnant
                  has received assistance under the State program funded 
                  under this part, the State shall disregard any month for
                  which such assistance was provided with respect to the
                  individual and during which the individual was--
                        `(i) a minor child; and
                        `(ii) not the head of a household or married to the
                      head of a household.
                    `(C) HARDSHIP EXCEPTION- 
                        `(i) IN GENERAL- The State may exempt a family from
                      the application of subparagraph (A) by reason of
                      hardship or if the family includes an individual who 
                      has been battered or subjected to extreme cruelty.
                        `(ii) LIMITATION- The number of families with respect
                      to which an exemption made by a State under clause (i)
                      is in effect for a fiscal year shall not exceed 20
                      percent of the average monthly number of families to
                      which assistance is provided under the State program
                      funded under this part.
                        `(iii) BATTERED OR SUBJECT TO EXTREME CRUELTY 
                      DEFINED- For purposes of clause (i), an individual has
                      been battered or subjected to extreme cruelty if the
                      individual has been subjected to--
            `(I) physical acts that resulted in, or threatened to result in,
          physical injury to the individual;
            `(II) sexual abuse;
            `(III) sexual activity involving a dependent child;
            `(IV) being forced as the caretaker relative of a dependent child
          to engage in nonconsensual sexual acts or activities;
            `(V) threats of, or attempts at, physical or sexual abuse;
            `(VI) mental abuse; or
            `(VII) neglect or deprivation of medical care.
                    `(D) DISREGARD OF MONTHS OF ASSISTANCE RECEIVED BY ADULT
                  WHILE LIVING ON AN INDIAN RESERVATION OR IN AN ALASKAN
                  NATIVE VILLAGE WITH 50 PERCENT UNEMPLOYMENT- In determining
                  the number of months for which an adult has received
                  assistance under the State program funded under this part,
                  the State shall disregard any month during which the adult
                  lived on an Indian reservation or in an Alaskan Native
                  village if, during the month--
                        `(i) at least 1,000 individuals were living on the
                      reservation or in the village ; and
                        `(ii) at least 50 percent of the adults living on the
                      reservation or in the village were unemployed.
                    `(E) RULE OF INTERPRETATION- Subparagraph (A) shall not 
                  be interpreted to require any State to provide assistance 
                  to any individual for any period of time under the State
                  program funded under this part.
                    `(F) RULE OF INTERPRETATION- This part shall not be
                  interpreted to prohibit any State from expending State 
                  funds not originating with the Federal Government on
                  benefits for children or families that have become
                  ineligible for assistance under the State program funded
                  under this part by reason of subparagraph (A).
                `(8) DENIAL OF ASSISTANCE FOR 10 YEARS TO A PERSON FOUND TO
              HAVE FRAUDULENTLY MISREPRESENTED RESIDENCE IN ORDER TO OBTAIN
              ASSISTANCE IN 2 OR MORE STATES- A State to which a grant is 
              made under section 403 shall not use any part of the grant to
              provide cash assistance to an individual during the 10-year
              period that begins on the date the individual is convicted in
              Federal or State court of having made a fraudulent statement or
              representation with respect to the place of residence of the
              individual in order to receive assistance simultaneously from 2
              or more States under programs that are funded under this title,
              title XIX, or the Food Stamp Act of 1977, or benefits in 2 or
              more States under the supplemental security income program 
              under title XVI. The preceding sentence shall not apply with
              respect to a conviction of an individual, for any month
              beginning after the President of the United States grants a
              pardon with respect to the conduct which was the subject of the
              conviction.
                `(9) DENIAL OF ASSISTANCE FOR FUGITIVE FELONS AND PROBATION
              AND PAROLE VIOLATORS-
                    `(A) IN GENERAL- A State to which a grant is made under
                  section 403 shall not use any part of the grant to provide
                  assistance to any individual who is--
                        `(i) fleeing to avoid prosecution, or custody or
                      confinement after conviction, under the laws of the
                      place from which the individual flees, for a crime, or
                      an attempt to commit a crime, which is a felony under
                      the laws of the place from which the individual flees,
                      or which, in the case of the State of New Jersey, is a
                      high misdemeanor under the laws of such State; or
                        `(ii) violating a condition of probation or parole
                      imposed under Federal or State law.
                  The preceding sentence shall not apply with respect to
                  conduct of an individual, for any month beginning after the
                  President of the United States grants a pardon with respect
                  to the conduct.
                    `(B) EXCHANGE OF INFORMATION WITH LAW ENFORCEMENT
                  AGENCIES- If a State to which a grant is made under section
                  403 establishes safeguards against the use or disclosure of
                  information about applicants or recipients of assistance
                  under the State program funded under this part, the
                  safeguards shall not prevent the State agency administering
                  the program from furnishing a Federal, State, or local law
                  enforcement officer, upon the request of the officer, with
                  the current address of any recipient if the officer
                  furnishes the agency with the name of the recipient and
                  notifies the agency that--
                        `(i) the recipient--
            `(I) is described in subparagraph (A); or
            `(II) has information that is necessary for the officer to 
          conduct the official duties of the officer; and
                        `(ii) the location or apprehension of the recipient 
                      is within such official duties.
                `(10) DENIAL OF ASSISTANCE FOR MINOR CHILDREN WHO ARE ABSENT
              FROM THE HOME FOR A SIGNIFICANT PERIOD-
                    `(A) IN GENERAL- A State to which a grant is made under
                  section 403 shall not use any part of the grant to provide
                  assistance for a minor child who has been, or is expected 
                  by a parent (or other caretaker relative) of the child to
                  be, absent from the home for a period of 45 consecutive 
                  days or, at the option of the State, such period of not 
                  less than 30 and not more than 180 consecutive days as the
                  State may provide for in the State plan submitted pursuant
                  to section 402.
                    `(B) STATE AUTHORITY TO ESTABLISH GOOD CAUSE EXCEPTIONS-
                  The State may establish such good cause exceptions to
                  subparagraph (A) as the State considers appropriate if such
                  exceptions are provided for in the State plan submitted
                  pursuant to section 402.
                    `(C) DENIAL OF ASSISTANCE FOR RELATIVE WHO FAILS TO 
                  NOTIFY STATE AGENCY OF ABSENCE OF CHILD- A State to which a
                  grant is made under section 403 shall not use any part of
                  the grant to provide assistance for an individual who is a
                  parent (or other caretaker relative) of a minor child and
                  who fails to notify the agency administering the State
                  program funded under this part of the absence of the minor
                  child from the home for the period specified in or provided
                  for pursuant to subparagraph (A), by the end of the 5-day
                  period that begins with the date that it becomes clear to
                  the parent (or relative) that the minor child will be 
                  absent for such period so specified or provided for.
                `(11) MEDICAL ASSISTANCE REQUIRED TO BE PROVIDED FOR CERTAIN
              FAMILIES HAVING EARNINGS FROM EMPLOYMENT OR CHILD SUPPORT-
                    `(A) EARNINGS FROM EMPLOYMENT- A State to which a grant 
                  is made under section 403 and which has a State plan
                  approved under title XIX shall provide that in the case of 
                  a family that is treated (under section 1931(b)(1)(A) for
                  purposes of title XIX) as receiving aid under a State plan
                  approved under this part (as in effect on July 16, 1996),
                  that would become ineligible for such aid because of hours
                  of or income from employment of the caretaker relative (as
                  defined under this part as in effect on such date) or
                  because of section 402(a)(8)(B)(ii)(II) (as so in effect),
                  and that was so treated as receiving such aid in at least 3
                  of the 6 months immediately preceding the month in which
                  such ineligibility begins, the family shall remain eligible
                  for medical assistance under the State's plan approved 
                  under title XIX for an extended period or periods as
                  provided in section 1925 or 1902(e)(1) (as applicable), and
                  that the family will be appropriately notified of such
                  extension as required by section 1925(a)(2).
                    `(B) CHILD SUPPORT- A State to which a grant is made 
                  under section 403 and which has a State plan approved under
                  title XIX shall provide that in the case of a family that 
                  is treated (under section 1931(b)(1)(A) for purposes of
                  title XIX) as receiving aid under a State plan approved
                  under this part (as in effect on July 16, 1996), that would
                  become ineligible for such aid as a result (wholly or
                  partly) of the collection of child or spousal support under
                  part D and that was so treated as receiving such aid in at
                  least 3 of the 6 months immediately preceding the month in
                  which such ineligibility begins, the family shall remain
                  eligible for medical assistance under the State's plan
                  approved under title XIX for an extended period or periods
                  as provided in section 1931(c)(1).
            `(b) INDIVIDUAL RESPONSIBILITY PLANS- 
                `(1) ASSESSMENT- The State agency responsible for
              administering the State program funded under this part shall
              make an initial assessment of the skills, prior work 
              experience, and employability of each recipient of assistance
              under the program who--
                    `(A) has attained 18 years of age; or
                    `(B) has not completed high school or obtained a
                  certificate of high school equivalency, and is not 
                  attending secondary school.
                `(2) CONTENTS OF PLANS- 
                    `(A) IN GENERAL- On the basis of the assessment made 
                  under subsection (a) with respect to an individual, the
                  State agency, in consultation with the individual, may
                  develop an individual responsibility plan for the
                  individual, which--
                        `(i) sets forth an employment goal for the individual
                      and a plan for moving the individual immediately into
                      private sector employment;
                        `(ii) sets forth the obligations of the individual,
                      which may include a requirement that the individual
                      attend school, maintain certain grades and attendance,
                      keep school age children of the individual in school,
                      immunize children, attend parenting and money 
                      management classes, or do other things that will help
                      the individual become and remain employed in the 
                      private sector;
                        `(iii) to the greatest extent possible is designed to
                      move the individual into whatever private sector
                      employment the individual is capable of handling as
                      quickly as possible, and to increase the responsibility
                      and amount of work the individual is to handle over time;
                        `(iv) describes the services the State will provide
                      the individual so that the individual will be able to
                      obtain and keep employment in the private sector, and
                      describe the job counseling and other services that 
                      will be provided by the State; and
                        `(v) may require the individual to undergo 
                      appropriate substance abuse treatment.
                    `(B) TIMING- The State agency may comply with paragraph
                  (1) with respect to an individual--
                        `(i) within 90 days (or, at the option of the State,
                      180 days) after the effective date of this part, in the
                      case of an individual who, as of such effective date, 
                      is a recipient of aid under the State plan approved
                      under part A (as in effect immediately before such
                      effective date); or
                        `(ii) within 30 days (or, at the option of the State,
                      90 days) after the individual is determined to be
                      eligible for such assistance, in the case of any other
                      individual.
                `(3) PENALTY FOR NONCOMPLIANCE BY INDIVIDUAL- In addition to
              any other penalties required under the State program funded
              under this part, the State may reduce, by such amount as the
              State considers appropriate, the amount of assistance otherwise
              payable under the State program to a family that includes an
              individual who fails without good cause to comply with an
              individual responsibility plan signed by the individual.
                `(4) STATE DISCRETION- The exercise of the authority of this
              subsection shall be within the sole discretion of the State.
            `(c) NONDISCRIMINATION PROVISIONS- The following provisions of 
          law shall apply to any program or activity which receives funds
          provided under this part:
                `(1) The Age Discrimination Act of 1975 (42 U.S.C. 6101 et
              seq.).
                `(2) Section 504 of the Rehabilitation Act of 1973 (29 U.S.C.
              794).
                `(3) The Americans with Disabilities Act of 1990 (42 U.S.C.
              12101 et seq.).
                `(4) Title VI of the Civil Rights Act of 1964 (42 U.S.C. 
              2000d et seq.).
            `(d) ALIENS- For special rules relating to the treatment of
          aliens, see section 402 of the Personal Responsibility and Work
          Opportunity Reconciliation Act of 1996.
          `SEC. 409. PENALTIES.
            `(a) IN GENERAL- Subject to this section:
                `(1) USE OF GRANT IN VIOLATION OF THIS PART- 
                    `(A) GENERAL PENALTY- If an audit conducted under chapter
                  75 of title 31, United States Code, finds that an amount
                  paid to a State under section 403 for a fiscal year has 
                  been used in violation of this part, the Secretary shall
                  reduce the grant payable to the State under section
                  403(a)(1) for the immediately succeeding fiscal year 
                  quarter by the amount so used.
                    `(B) ENHANCED PENALTY FOR INTENTIONAL VIOLATIONS- If the
                  State does not prove to the satisfaction of the Secretary
                  that the State did not intend to use the amount in 
                  violation of this part, the Secretary shall further reduce
                  the grant payable to the State under section 403(a)(1) for
                  the immediately succeeding fiscal year quarter by an amount
                  equal to 5 percent of the State family assistance grant.
                `(2) FAILURE TO SUBMIT REQUIRED REPORT- 
                    `(A) IN GENERAL- If the Secretary determines that a State
                  has not, within 1 month after the end of a fiscal quarter,
                  submitted the report required by section 411(a) for the
                  quarter, the Secretary shall reduce the grant payable to 
                  the State under section 403(a)(1) for the immediately
                  succeeding fiscal year by an amount equal to 4 percent of
                  the State family assistance grant.
                    `(B) RESCISSION OF PENALTY- The Secretary shall rescind a
                  penalty imposed on a State under subparagraph (A) with
                  respect to a report if the State submits the report before
                  the end of the fiscal quarter that immediately succeeds the
                  fiscal quarter for which the report was required.
                `(3) FAILURE TO SATISFY MINIMUM PARTICIPATION RATES- 
                    `(A) IN GENERAL- If the Secretary determines that a State
                  to which a grant is made under section 403 for a fiscal 
                  year has failed to comply with section 407(a) for the 
                  fiscal year, the Secretary shall reduce the grant payable 
                  to the State under section 403(a)(1) for the immediately
                  succeeding fiscal year by an amount equal to not more than
                  the applicable percentage of the State family assistance
                  grant.
                    `(B) APPLICABLE PERCENTAGE DEFINED- As used in
                  subparagraph (A), the term `applicable percentage' means,
                  with respect to a State--
                        `(i) if a penalty was not imposed on the State under
                      subparagraph (A) for the immediately preceding fiscal
                      year, 5 percent; or
                        `(ii) if a penalty was imposed on the State under
                      subparagraph (A) for the immediately preceding fiscal
                      year, the lesser of--
            `(I) the percentage by which the grant payable to the State under
          section 403(a)(1) was reduced for such preceding fiscal year,
          increased by 2 percentage points; or
            `(II) 21 percent.
                    `(C) 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, and
                  may reduce the penalty if the noncompliance is due to
                  circumstances that caused the State to become a needy State
                  (as defined in section 403(b)(6)) during the fiscal year.
                `(4) FAILURE TO PARTICIPATE IN THE INCOME AND ELIGIBILITY
              VERIFICATION SYSTEM- If the Secretary determines that a State
              program funded under this part is not participating during a
              fiscal year in the income and eligibility verification system
              required by section 1137, the Secretary shall reduce the grant
              payable to the State under section 403(a)(1) for the 
              immediately succeeding fiscal year by an amount equal to not
              more than 2 percent of the State family assistance grant.
                `(5) FAILURE TO COMPLY WITH PATERNITY ESTABLISHMENT AND CHILD
              SUPPORT ENFORCEMENT REQUIREMENTS UNDER PART D- Notwithstanding
              any other provision of this Act, if the Secretary determines
              that the State agency that administers a program funded under
              this part does not enforce the penalties requested by the 
              agency administering part D against recipients of assistance
              under the State program who fail to cooperate in establishing
              paternity or in establishing, modifying, or enforcing a child
              support order in accordance with such part and who do not
              qualify for any good cause or other exception established by 
              the State under section 454(29), the Secretary shall reduce the
              grant payable to the State under section 403(a)(1) for the
              immediately succeeding fiscal year (without regard to this
              section) by not more than 5 percent.
                `(6) FAILURE TO TIMELY REPAY A FEDERAL LOAN FUND FOR STATE
              WELFARE PROGRAMS- If the Secretary determines that a State has
              failed to repay any amount borrowed from the Federal Loan Fund
              for State Welfare Programs established under section 406 within
              the period of maturity applicable to the loan, plus any 
              interest owed on the loan, the Secretary shall reduce the grant
              payable to the State under section 403(a)(1) for the 
              immediately succeeding fiscal year quarter (without regard to
              this section) by the outstanding loan amount, plus the interest
              owed on the outstanding amount. The Secretary shall not forgive
              any outstanding loan amount or interest owed on the outstanding
              amount.
                `(7) FAILURE OF ANY STATE TO MAINTAIN CERTAIN LEVEL OF
              HISTORIC EFFORT-
                    `(A) IN GENERAL- The Secretary shall reduce the grant
                  payable to the State under section 403(a)(1) for fiscal 
                  year 1998, 1999, 2000, 2001, 2002, or 2003 by the amount 
                  (if any) by which qualified State expenditures for the then
                  immediately preceding fiscal year are less than the
                  applicable percentage of historic State expenditures with
                  respect to such preceding fiscal year.
                    `(B) DEFINITIONS- As used in this paragraph:
                        `(i) QUALIFIED STATE EXPENDITURES- 
            `(I) IN GENERAL- The term `qualified State expenditures' means,
          with respect to a State and a fiscal year, the total expenditures 
          by the State during the fiscal year, under all State programs, for
          any of the following with respect to eligible families:
            `(aa) Cash assistance.
            `(bb) Child care assistance.
            `(cc) Educational activities designed to increase
          self-sufficiency, job training, and work, excluding any expenditure
          for public education in the State except expenditures which involve
          the provision of services or assistance to a member of an eligible
          family which is not generally available to persons who are not
          members of an eligible family.
            `(dd) Administrative costs in connection with the matters
          described in items (aa), (bb), (cc), and (ee), but only to the
          extent that such costs do not exceed 15 percent of the total amount
          of qualified State expenditures for the fiscal year.
            `(ee) Any other use of funds allowable under section 404(a)(1).
            `(II) EXCLUSION OF TRANSFERS FROM OTHER STATE AND LOCAL PROGRAMS-
          Such term does not include expenditures under any State or local
          program during a fiscal year, except to the extent that--
            `(aa) the expenditures exceed the amount expended under the State
          or local program in the fiscal year most recently ending before the
          date of the enactment of this part; or
            `(bb) the State is entitled to a payment under former section 403
          (as in effect immediately before such date of enactment) with
          respect to the expenditures.
            `(III) ELIGIBLE FAMILIES- As used in subclause (I), the term
          `eligible families' means families eligible for assistance under 
          the State program funded under this part, and families that would 
          be eligible for such assistance but for the application of section
          408(a)(7) of this Act or section 402 of the Personal Responsibility
          and Work Opportunity Reconciliation Act of 1996.
                        `(ii) APPLICABLE PERCENTAGE- The term `applicable
                      percentage' means for fiscal years 1997 through 2002, 
                      80 percent (or, if the State meets the requirements of
                      section 407(a) for the fiscal year, 75 percent) reduced
                      (if appropriate) in accordance with subparagraph (C)(ii).
                        `(iii) HISTORIC STATE EXPENDITURES- The term 
                      `historic State expenditures' means, with respect to a
                      State, the lesser of--
            `(I) the expenditures by the State under parts A and F (as in
          effect during fiscal year 1994) for fiscal year 1994; or
            `(II) the amount which bears the same ratio to the amount
          described in subclause (I) as--
            `(aa) the State family assistance grant, plus the total amount
          required to be paid to the State under former section 403 for 
          fiscal year 1994 with respect to amounts expended by the State for
          child care under subsection (g) or (i) of section 402 (as in effect
          during fiscal year 1994); bears to
            `(bb) the total amount required to be paid to the State under
          former section 403 (as in effect during fiscal year 1994) for 
          fiscal year 1994.
                      Such term does not include any expenditures under the
                      State plan approved under part A (as so in effect) on
                      behalf of individuals covered by a tribal family
                      assistance plan approved under section 412, as
                      determined by the Secretary.
                        `(iv) EXPENDITURES BY THE STATE- The term
                      `expenditures by the State' does not include--
            `(I) any expenditures from amounts made available by the Federal
          Government;
            `(II) any State funds expended for the medicaid program under
          title XIX;
            `(III) any State funds which are used to match Federal funds; or
            `(IV) any State funds which are expended as a condition of
          receiving Federal funds under Federal programs other than under 
          this part.
                      Notwithstanding subclause (IV) of the preceding
                      sentence, such term includes expenditures by a State 
                      for child care in a fiscal year to the extent that the
                      total amount of such expenditures does not exceed an
                      amount equal to the amount of State expenditures in
                      fiscal year 1994 or 1995 (whichever is greater) that
                      equal the non-Federal share for the programs described
                      in section 418(a)(1)(A).
                `(8) SUBSTANTIAL NONCOMPLIANCE OF STATE CHILD SUPPORT
              ENFORCEMENT PROGRAM WITH REQUIREMENTS OF PART D-
                    `(A) IN GENERAL- If a State program operated under part D
                  is found as a result of a review conducted under section
                  452(a)(4) not to have complied substantially with the
                  requirements of such part for any quarter, and the 
                  Secretary determines that the program is not complying
                  substantially with such requirements at the time the 
                  finding is made, the Secretary shall reduce the grant
                  payable to the State under section 403(a)(1) for the 
                  quarter and each subsequent quarter that ends before the 
                  1st quarter throughout which the program is found to be in
                  substantial compliance with such requirements by--
                        `(i) not less than 1 nor more than 2 percent;
                        `(ii) not less than 2 nor more than 3 percent, if the
                      finding is the 2nd consecutive such finding made as a
                      result of such a review; or
                        `(iii) not less than 3 nor more than 5 percent, if 
                      the finding is the 3rd or a subsequent consecutive such
                      finding made as a result of such a review.
                    `(B) DISREGARD OF NONCOMPLIANCE WHICH IS OF A TECHNICAL
                  NATURE- For purposes of subparagraph (A) and section
                  452(a)(4), a State which is not in full compliance with the
                  requirements of this part shall be determined to be in
                  substantial compliance with such requirements only if the
                  Secretary determines that any noncompliance with such
                  requirements is of a technical nature which does not
                  adversely affect the performance of the State's program
                  operated under part D.
                `(9) FAILURE TO COMPLY WITH 5-YEAR LIMIT ON ASSISTANCE- If 
              the Secretary determines that a State has not complied with
              section 408(a)(1)(B) during a 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.
                `(10) FAILURE OF STATE RECEIVING AMOUNTS FROM CONTINGENCY 
              FUND TO MAINTAIN 100 PERCENT OF HISTORIC EFFORT- If, at the end
              of any fiscal year during which amounts from the Contingency
              Fund for State Welfare Programs have been paid to a State, the
              Secretary finds that the expenditures under the State program
              funded under this part for the fiscal year (excluding any
              amounts made available by the Federal Government) are less than
              100 percent of historic State expenditures (as defined in
              paragraph (7)(B)(iii) of this subsection), the Secretary shall
              reduce the grant payable to the State under section 403(a)(1)
              for the immediately succeeding fiscal year by the total of the
              amounts so paid to the State.
                `(11) FAILURE TO MAINTAIN ASSISTANCE TO ADULT SINGLE 
              CUSTODIAL PARENT WHO CANNOT OBTAIN CHILD CARE FOR CHILD UNDER
              AGE 6-
                    `(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 407(e)(2) 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 not more than 5 percent 
                  of the State family assistance grant.
                    `(B) PENALTY BASED ON SEVERITY OF FAILURE- The Secretary
                  shall impose reductions under subparagraph (A) with respect
                  to a fiscal year based on the degree of noncompliance.
                `(12) FAILURE TO EXPEND ADDITIONAL STATE FUNDS TO REPLACE
              GRANT REDUCTIONS- If the grant payable to a State under section
              403(a)(1) for a fiscal year is reduced by reason of this
              subsection, the State shall, during the immediately succeeding
              fiscal year, expend under the State program funded under this
              part an amount equal to the total amount of such reductions.
            `(b) REASONABLE CAUSE EXCEPTION- 
                `(1) IN GENERAL- The Secretary may not impose a penalty on a
              State under subsection (a) with respect to a requirement if the
              Secretary determines that the State has reasonable cause for
              failing to comply with the requirement.
                `(2) EXCEPTION- Paragraph (1) of this subsection shall not
              apply to any penalty under paragraph (7) or (8) of subsection
              (a).
            `(c) CORRECTIVE COMPLIANCE PLAN- 
                `(1) IN GENERAL- 
                    `(A) NOTIFICATION OF VIOLATION- Before imposing a penalty
                  against a State under subsection (a) with respect to a
                  violation of this part, the Secretary shall notify the 
                  State of the violation and allow the State the opportunity
                  to enter into a corrective compliance plan in accordance
                  with this subsection which outlines how the State will
                  correct the violation and how the State will insure
                  continuing compliance with this part.
                    `(B) 60-DAY PERIOD TO PROPOSE A CORRECTIVE COMPLIANCE
                  PLAN- During the 60-day period that begins on the date the
                  State receives a notice provided under sub-paragraph (A)
                  with respect to a violation, the State may submit to the
                  Federal Government a corrective compliance plan to correct
                  the violation.
                    `(C) CONSULTATION ABOUT MODIFICATIONS- During the 60-day
                  period that begins with the date the Secretary receives a
                  corrective compliance plan submitted by a State in
                  accordance with subparagraph (B), the Secretary may consult
                  with the State on modifications to the plan.
                    `(D) ACCEPTANCE OF PLAN-  A corrective compliance plan
                  submitted by a State in accordance with subparagraph (B) is
                  deemed to be accepted by the Secretary if the Secretary 
                  does not accept or reject the plan during 60-day period 
                  that begins on the date the plan is submitted.
                `(2) EFFECT OF CORRECTING VIOLATION- The Secretary may not
              impose any penalty under subsection (a) with respect to any
              violation covered by a State corrective compliance plan 
              accepted by the Secretary if the State corrects the violation
              pursuant to the plan.
                `(3) EFFECT OF FAILING TO CORRECT VIOLATION- The Secretary
              shall assess some or all of a penalty imposed on a State under
              subsection (a) with respect to a violation if the State does
              not, in a timely manner, correct the violation pursuant to a
              State corrective compliance plan accepted by the Secretary.
                `(4) INAPPLICABILITY TO FAILURE TO TIMELY REPAY A FEDERAL 
              LOAN FUND FOR A STATE WELFARE PROGRAM- This subsection shall 
              not apply to the imposition of a penalty against a State under
              subsection (a)(6).
            `(d) LIMITATION ON AMOUNT OF PENALTIES- 
                `(1) IN GENERAL- In imposing the penalties described in
              subsection (a), the Secretary shall not reduce any quarterly
              payment to a State by more than 25 percent.
                `(2) CARRYFORWARD OF UNRECOVERED PENALTIES- To the extent 
              that paragraph (1) of this subsection prevents the Secretary
              from recovering during a fiscal year the full amount of
              penalties imposed on a State under subsection (a) of this
              section for a prior fiscal year, the Secretary shall apply any
              remaining amount of such penalties to the grant payable to the
              State under section 403(a)(1) for the immediately succeeding
              fiscal year.
          `SEC. 410. APPEAL OF ADVERSE DECISION.
            `(a) IN GENERAL- Within 5 days after the date the Secretary takes
          any adverse action under this part with respect to a State, the
          Secretary shall notify the chief executive officer of the State of
          the adverse action, including any action with respect to the State
          plan submitted under section 402 or the imposition of a penalty
          under section 409.
            `(b) ADMINISTRATIVE REVIEW- 
                `(1) IN GENERAL- Within 60 days after the date a State
              receives notice under subsection (a) of an adverse action, the
              State may appeal the action, in whole or in part, to the
              Departmental Appeals Board established in the Department of
              Health and Human Services (in this section referred to as the
              `Board') by filing an appeal with the Board.
                `(2) PROCEDURAL RULES- The Board shall consider an appeal
              filed by a State under paragraph (1) on the basis of such
              documentation as the State may submit and as the Board may
              require to support the final decision of the Board. In deciding
              whether to uphold an adverse action or any portion of such an
              action, the Board shall conduct a thorough review of the issues
              and take into account all relevant evidence. The Board shall
              make a final determination with respect to an appeal filed 
              under paragraph (1) not less than 60 days after the date the
              appeal is filed.
            `(c) JUDICIAL REVIEW OF ADVERSE DECISION- 
                `(1) IN GENERAL- Within 90 days after the date of a final
              decision by the Board under this section with respect to an
              adverse action taken against a State, the State may obtain
              judicial review of the final decision (and the findings
              incorporated into the final decision) by filing an action in--
                    `(A) the district court of the United States for the
                  judicial district in which the principal or headquarters
                  office of the State agency is located; or
                    `(B) the United States District Court for the District of
                  Columbia.
                `(2) PROCEDURAL RULES- The district court in which an action
              is filed under paragraph (1) shall review the final decision of
              the Board on the record established in the administrative
              proceeding, in accordance with the standards of review
              prescribed by subparagraphs (A) through (E) of section 706(2) 
              of title 5, United States Code. The review shall be on the 
              basis of the documents and supporting data submitted to the
              Board.
          `SEC. 411. DATA COLLECTION AND REPORTING.
            `(a) QUARTERLY REPORTS BY STATES- 
                `(1) GENERAL REPORTING REQUIREMENT- 
                    `(A) CONTENTS OF REPORT- Each eligible State shall 
                  collect on a monthly basis, and report to the Secretary on 
                  a quarterly basis, the following disaggregated case record
                  information on the families receiving assistance under the
                  State program funded under this part:
                        `(i) The county of residence of the family.
                        `(ii) Whether a child receiving such assistance or an
                      adult in the family is disabled.
                        `(iii) The ages of the members of such families.
                        `(iv) The number of individuals in the family, and 
                      the relation of each family member to the youngest 
                      child in the family.
                        `(v) The employment status and earnings of the
                      employed adult in the family.
                        `(vi) The marital status of the adults in the family,
                      including whether such adults have never married, are
                      widowed, or are divorced.
                        `(vii) The race and educational status of each adult
                      in the family.
                        `(viii) The race and educational status of each child
                      in the family.
                        `(ix) Whether the family received subsidized housing,
                      medical assistance under the State plan approved under
                      title XIX, food stamps, or subsidized child care, and 
                      if the latter 2, the amount received.
                        `(x) The number of months that the family has 
                      received each type of assistance under the program.
                        `(xi) If the adults participated in, and the number 
                      of hours per week of participation in, the following
                      activities:
            `(I) Education.
            `(II) Subsidized private sector employment.
            `(III) Unsubsidized employment.
            `(IV) Public sector employment, work experience, or community
          service.
            `(V) Job search.
            `(VI) Job skills training or on-the-job training.
            `(VII) Vocational education.
                        `(xii) Information necessary to calculate
                      participation rates under section 407.
                        `(xiii) The type and amount of assistance received
                      under the program, including the amount of and reason
                      for any reduction of assistance (including sanctions).
                        `(xiv) Any amount of unearned income received by any
                      member of the family.
                        `(xv) The citizenship of the members of the family.
                        `(xvi) From a sample of closed cases, whether the
                      family left the program, and if so, whether the family
                      left due to--
            `(I) employment;
            `(II) marriage;
            `(III) the prohibition set forth in section 408(a)(7);
            `(IV) sanction; or
            `(V) State policy.
                    `(B) USE OF ESTIMATES- 
                        `(i) AUTHORITY- A State may comply with subparagraph
                      (A) by submitting an estimate which is obtained through
                      the use of scientifically acceptable sampling methods
                      approved by the Secretary.
                        `(ii) SAMPLING AND OTHER METHODS- The Secretary shall
                      provide the States with such case sampling plans and
                      data collection procedures as the Secretary deems
                      necessary to produce statistically valid estimates of
                      the performance of State programs funded under this
                      part. The Secretary may develop and implement 
                      procedures for verifying the quality of data submitted
                      by the States.
                `(2) REPORT ON USE OF FEDERAL FUNDS TO COVER ADMINISTRATIVE
              COSTS AND OVERHEAD- The report required by paragraph (1) for a
              fiscal quarter shall include a statement of the percentage of
              the funds paid to the State under this part for the quarter 
              that are used to cover administrative costs or overhead.
                `(3) REPORT ON STATE EXPENDITURES ON PROGRAMS FOR NEEDY
              FAMILIES- The report required by paragraph (1) for a fiscal
              quarter shall include a statement of the total amount expended
              by the State during the quarter on programs for needy families.
                `(4) REPORT ON NONCUSTODIAL PARENTS PARTICIPATING IN WORK
              ACTIVITIES- The report required by paragraph (1) for a fiscal
              quarter shall include the number of noncustodial parents in the
              State who participated in work activities (as defined in 
              section 407(d)) during the quarter.
                `(5) REPORT ON TRANSITIONAL SERVICES- The report required by
              paragraph (1) for a fiscal quarter shall include the total
              amount expended by the State during the quarter to provide
              transitional services to a family that has ceased to receive
              assistance under this part because of employment, along with a
              description of such services.
                `(6) REGULATIONS- The Secretary shall prescribe such
              regulations as may be necessary to define the data elements 
              with respect to which reports are required by this subsection.
            `(b) ANNUAL REPORTS TO THE CONGRESS BY THE SECRETARY- Not later
          than 6 months after the end of fiscal year 1997, and each fiscal
          year thereafter, the Secretary shall transmit to the Congress a
          report describing--
                `(1) whether the States are meeting--
                    `(A) the participation rates described in section 407(a);
                  and
                    `(B) the objectives of--
                        `(i) increasing employment and earnings of needy
                      families, and child support collections; and
                        `(ii) decreasing out-of-wedlock pregnancies and child
                      poverty;
                `(2) the demographic and financial characteristics of 
              families applying for assistance, families receiving 
              assistance, and families that become ineligible to receive
              assistance;
                `(3) the characteristics of each State program funded under
              this part; and
                `(4) the trends in employment and earnings of needy families
              with minor children living at home.
          `SEC. 412. DIRECT FUNDING AND ADMINISTRATION BY INDIAN TRIBES.
            `(a) GRANTS FOR INDIAN TRIBES- 
                `(1) TRIBAL FAMILY ASSISTANCE GRANT- 
                    `(A) IN GENERAL- For each of fiscal years 1997, 1998,
                  1999, 2000, 2001, and 2002, the Secretary shall pay to each
                  Indian tribe that has an approved tribal family assistance
                  plan a tribal family assistance grant for the fiscal year 
                  in an amount equal to the amount determined under
                  subparagraph (B), and shall reduce the grant payable under
                  section 403(a)(1) to any State in which lies the service
                  area or areas of the Indian tribe by that portion of the
                  amount so determined that is attributable to expenditures 
                  by the State.
                    `(B) AMOUNT DETERMINED- 
                        `(i) IN GENERAL- The amount determined under this
                      subparagraph is an amount equal to the total amount of
                      the Federal payments to a State or States under section
                      403 (as in effect during such fiscal year) for fiscal
                      year 1994 attributable to expenditures (other than 
                      child care expenditures) by the State or States under
                      parts A and F (as so in effect) for fiscal year 1994 
                      for Indian families residing in the service area or
                      areas identified by the Indian tribe pursuant to
                      subsection (b)(1)(C) of this section.
                        `(ii) USE OF STATE SUBMITTED DATA- 
            `(I) IN GENERAL- The Secretary shall use State submitted data to
          make each determination under clause (i).
            `(II) DISAGREEMENT WITH DETERMINATION- If an Indian tribe or
          tribal organization disagrees with State submitted data described
          under subclause (I), the Indian tribe or tribal organization may
          submit to the Secretary such additional information as may be
          relevant to making the determination under clause (i) and the
          Secretary may consider such information before making such
          determination.
                `(2) GRANTS FOR INDIAN TRIBES THAT RECEIVED JOBS FUNDS- 
                    `(A) IN GENERAL- The Secretary shall pay to each eligible
                  Indian tribe for each of fiscal years 1997, 1998, 1999,
                  2000, 2001, and 2002 a grant in an amount equal to the
                  amount received by the Indian tribe in fiscal year 1994
                  under section 482(i) (as in effect during fiscal year 1994).
                    `(B) ELIGIBLE INDIAN TRIBE- For purposes of subparagraph
                  (A), the term `eligible Indian tribe' means an Indian tribe
                  or Alaska Native organization that conducted a job
                  opportunities and basic skills training program in fiscal
                  year 1995 under section 482(i) (as in effect during fiscal
                  year 1995).
                    `(C) USE OF GRANT- Each Indian tribe to which a grant is
                  made under this paragraph shall use the grant for the
                  purpose of operating a program to make work activities
                  available to members of the Indian tribe.
                    `(D) APPROPRIATION- Out of any money in the Treasury of
                  the United States not otherwise appropriated, there are
                  appropriated $7,638,474 for each fiscal year specified in
                  subparagraph (A) for grants under subparagraph (A).
            `(b) 3-YEAR TRIBAL FAMILY ASSISTANCE PLAN- 
                `(1) IN GENERAL- Any Indian tribe that desires to receive a
              tribal family assistance grant shall submit to the Secretary a
              3-year tribal family assistance plan that--
                    `(A) outlines the Indian tribe's approach to providing
                  welfare-related services for the 3-year period, consistent
                  with this section;
                    `(B) specifies whether the welfare-related services
                  provided under the plan will be provided by the Indian 
                  tribe or through agreements, contracts, or compacts with
                  intertribal consortia, States, or other entities;
                    `(C) identifies the population and service area or areas
                  to be served by such plan;
                    `(D) provides that a family receiving assistance under 
                  the plan may not receive duplicative assistance from other
                  State or tribal programs funded under this part;
                    `(E) identifies the employment opportunities in or near
                  the service area or areas of the Indian tribe and the 
                  manner in which the Indian tribe will cooperate and
                  participate in enhancing such opportunities for recipients
                  of assistance under the plan consistent with any applicable
                  State standards; and
                    `(F) applies the fiscal accountability provisions of
                  section 5(f)(1) of the Indian Self-Determination and
                  Education Assistance Act (25 U.S.C. 450c(f)(1)), relating 
                  to the submission of a single-agency audit report required
                  by chapter 75 of title 31, United States Code.
                `(2) APPROVAL- The Secretary shall approve each tribal family
              assistance plan submitted in accordance with paragraph (1).
                `(3) CONSORTIUM OF TRIBES- Nothing in this section shall
              preclude the development and submission of a single tribal
              family assistance plan by the participating Indian tribes of an
              intertribal consortium.
            `(c) MINIMUM WORK PARTICIPATION REQUIREMENTS AND TIME LIMITS- The
          Secretary, with the participation of Indian tribes, shall establish
          for each Indian tribe receiving a grant under this section minimum
          work participation requirements, appropriate time limits for 
          receipt of welfare-related services under the grant, and penalties
          against individuals--
                `(1) consistent with the purposes of this section;
                `(2) consistent with the economic conditions and resources
              available to each tribe; and
                `(3) similar to comparable provisions in section 407(e).
            `(d) EMERGENCY ASSISTANCE- Nothing in this section shall preclude
          an Indian tribe from seeking emergency assistance from any Federal
          loan program or emergency fund.
            `(e) ACCOUNTABILITY- Nothing in this section shall be construed 
          to limit the ability of the Secretary to maintain program funding
          accountability consistent with--
                `(1) generally accepted accounting principles; and
                `(2) the requirements of the Indian Self-Determination and
              Education Assistance Act (25 U.S.C. 450 et seq.).
            `(f) PENALTIES- 
                `(1) Subsections (a)(1), (a)(6), and (b) of section 409, 
              shall apply to an Indian tribe with an approved tribal
              assistance plan in the same manner as such subsections apply to
              a State.
                `(2) Section 409(a)(3) shall apply to an Indian tribe with an
              approved tribal assistance plan by substituting `meet minimum
              work participation requirements established under section
              412(c)' for `comply with section 407(a)'.
            `(g) DATA COLLECTION AND REPORTING- Section 411 shall apply to an
          Indian tribe with an approved tribal family assistance plan.
            `(h) SPECIAL RULE FOR INDIAN TRIBES IN ALASKA- 
                `(1) IN GENERAL- Notwithstanding any other provision of this
              section, and except as provided in paragraph (2), an Indian
              tribe in the State of Alaska that receives a tribal family
              assistance grant under this section shall use the grant to
              operate a program in accordance with requirements comparable to
              the requirements applicable to the program of the State of
              Alaska funded under this part. Comparability of programs shall
              be established on the basis of program criteria developed by 
              the Secretary in consultation with the State of Alaska and such
              Indian tribes.
                `(2) WAIVER- An Indian tribe described in paragraph (1) may
              apply to the appropriate State authority to receive a waiver of
              the requirement of paragraph (1).
          `SEC. 413. RESEARCH, EVALUATIONS, AND NATIONAL STUDIES.
            `(a) RESEARCH- The Secretary shall conduct research on the
          benefits, effects, and costs of operating different State programs
          funded under this part, including time limits relating to
          eligibility for assistance. The research shall include studies on
          the effects of different programs and the operation of such 
          programs on welfare dependency, illegitimacy, teen pregnancy,
          employment rates, child well-being, and any other area the 
          Secretary deems appropriate. The Secretary shall also conduct
          research on the costs and benefits of State activities under 
          section 409.
            `(b) DEVELOPMENT AND EVALUATION OF INNOVATIVE APPROACHES TO
          REDUCING WELFARE DEPENDENCY AND INCREASING CHILD WELL-BEING-
                `(1) IN GENERAL- The Secretary may assist States in
              developing, and shall evaluate, innovative approaches for
              reducing welfare dependency and increasing the well-being of
              minor children living at home with respect to recipients of
              assistance under programs funded under this part. The Secretary
              may provide funds for training and technical assistance to 
              carry out the approaches developed pursuant to this paragraph.
                `(2) EVALUATIONS- In performing the evaluations under
              paragraph (1), the Secretary shall, to the maximum extent
              feasible, use random assignment as an evaluation methodology.
            `(c) DISSEMINATION OF INFORMATION- The Secretary shall develop
          innovative methods of disseminating information on any research,
          evaluations, and studies conducted under this section, including 
          the facilitation of the sharing of information and best practices
          among States and localities through the use of computers and other
          technologies.
            `(d) ANNUAL RANKING OF STATES AND REVIEW OF MOST AND LEAST
          SUCCESSFUL WORK PROGRAMS-
                `(1) ANNUAL RANKING OF STATES- The Secretary shall rank
              annually the States to which grants are paid under section 403
              in the order of their success in placing recipients of
              assistance under the State program funded under this part into
              long-term private sector jobs, reducing the overall welfare
              caseload, and, when a practicable method for calculating this
              information becomes available, diverting individuals from
              formally applying to the State program and receiving 
              assistance. In ranking States under this subsection, the
              Secretary shall take into account the average number of minor
              children living at home in families in the State that have
              incomes below the poverty line and the amount of funding
              provided each State for such families.
                `(2) ANNUAL REVIEW OF MOST AND LEAST SUCCESSFUL WORK 
              PROGRAMS- The Secretary shall review the programs of the 3
              States most recently ranked highest under paragraph (1) and the
              3 States most recently ranked lowest under paragraph (1) that
              provide parents with work experience, assistance in finding
              employment, and other work preparation activities and support
              services to enable the families of such parents to leave the
              program and become self-sufficient.
            `(e) ANNUAL RANKING OF STATES AND REVIEW OF ISSUES RELATING TO
          OUT-OF-WEDLOCK BIRTHS-
                `(1) ANNUAL RANKING OF STATES- 
                    `(A) IN GENERAL- The Secretary shall annually rank States
                  to which grants are made under section 403 based on the
                  following ranking factors:
                        `(i) ABSOLUTE OUT-OF-WEDLOCK RATIOS- The ratio
                      represented by--
            `(I) the total number of out-of-wedlock births in families
          receiving assistance under the State program under this part in the
          State for the most recent fiscal year for which information is
          available; over
            `(II) the total number of births in families receiving assistance
          under the State program under this part in the State for such year.
                        `(ii) NET CHANGES IN THE OUT-OF-WEDLOCK RATIO- The
                      difference between the ratio described in subparagraph
                      (A)(i) with respect to a State for the most recent
                      fiscal year for which such information is available and
                      the ratio with respect to the State for the immediately
                      preceding year.
                `(2) ANNUAL REVIEW- The Secretary shall review the programs 
              of the 5 States most recently ranked highest under paragraph 
              (1) and the 5 States most recently ranked the lowest under
              paragraph (1).
            `(f) STATE-INITIATED EVALUATIONS- A State shall be eligible to
          receive funding to evaluate the State program funded under this 
          part if--
                `(1) the State submits a proposal to the Secretary for the
              evaluation;
                `(2) the Secretary determines that the design and approach of
              the evaluation is rigorous and is likely to yield information
              that is credible and will be useful to other States; and
                `(3) unless otherwise waived by the Secretary, the State
              contributes to the cost of the evaluation, from non-Federal
              sources, an amount equal to at least 10 percent of the cost of
              the evaluation.
            `(g) REPORT ON CIRCUMSTANCES OF CERTAIN CHILDREN AND FAMILIES- 
                `(1) IN GENERAL- Beginning 3 years after the date of the
              enactment of this Act, the Secretary of Health and Human
              Services shall prepare and submit to the Committees on Ways and
              Means and on Economic and Educational Opportunities of the 
              House of Representatives and to the Committees on Finance and 
              on Labor and Resources of the Senate annual reports that 
              examine in detail the matters described in paragraph (2) with
              respect to each of the following groups for the period after
              such enactment:
                    `(A) Individuals who were children in families that have
                  become ineligible for assistance under a State program
                  funded under this part by reason of having reached a time
                  limit on the provision of such assistance.
                    `(B) Children born after such date of enactment to 
                  parents who, at the time of such birth, had not attained 20
                  years of age.
                    `(C) Individuals who, after such date of enactment, 
                  became parents before attaining 20 years of age.
                `(2) MATTERS DESCRIBED- The matters described in this
              paragraph are the following:
                    `(A) The percentage of each group that has dropped out of
                  secondary school (or the equivalent), and the percentage of
                  each group at each level of educational attainment.
                    `(B) The percentage of each group that is employed.
                    `(C) The percentage of each group that has been convicted
                  of a crime or has been adjudicated as a delinquent.
                    `(D) The rate at which the members of each group are 
                  born, or have children, out-of-wedlock, and the percentage
                  of each group that is married.
                    `(E) The percentage of each group that continues to
                  participate in State programs funded under this part.
                    `(F) The percentage of each group that has health
                  insurance provided by a private entity (broken down by
                  whether the insurance is provided through an employer or
                  otherwise), the percentage that has health insurance
                  provided by an agency of government, and the percentage 
                  that does not have health insurance.
                    `(G) The average income of the families of the members of
                  each group.
                    `(H) Such other matters as the Secretary deems appropriate.
            `(h) FUNDING OF STUDIES AND DEMONSTRATIONS- 
                `(1) IN GENERAL- Out of any money in the Treasury of the
              United States not otherwise appropriated, there are 
              appropriated $15,000,000 for each of fiscal years 1997 through
              2002 for the purpose of paying--
                    `(A) the cost of conducting the research described in
                  subsection (a);
                    `(B) the cost of developing and evaluating innovative
                  approaches for reducing welfare dependency and increasing
                  the well-being of minor children under subsection (b);
                    `(C) the Federal share of any State-initiated study
                  approved under subsection (f); and
                    `(D) an amount determined by the Secretary to be 
                  necessary to operate and evaluate demonstration projects,
                  relating to this part, that are in effect or approved under
                  section 1115 as of September 30, 1995, and are continued
                  after such date.
                `(2) ALLOCATION- Of the amount appropriated under paragraph
              (1) for a fiscal year--
                    `(A) 50 percent shall be allocated for the pur-poses
                  described in subparagraphs (A) and (B) of paragraph (1), and
                    `(B) 50 percent shall be allocated for the purposes
                  described in subparagraphs (C) and (D) of paragraph (1).
                `(3) DEMONSTRATIONS OF INNOVATIVE STRATEGIES- The Secretary
              may implement and evaluate demonstrations of innovative and
              promising strategies which--
                    `(A) provide one-time capital funds to establish, expand,
                  or replicate programs;
                    `(B) test performance-based grant-to-loan financing in
                  which programs meeting performance targets receive grants
                  while programs not meeting such targets repay funding on a
                  prorated basis; and
                    `(C) test strategies in multiple States and types of
                  communities.
            `(i) CHILD POVERTY RATES- 
                `(1) IN GENERAL- Not later than 90 days after the date of the
              enactment of this part, and annually thereafter, the chief
              executive officer of each State shall submit to the Secretary a
              statement of the child poverty rate in the State as of such 
              date of enactment or the date of the most recent prior 
              statement under this paragraph.
                `(2) SUBMISSION OF CORRECTIVE ACTION PLAN- Not later than 90
              days after the date a State submits a statement under paragraph
              (1) which indicates that, as a result of the amendments made by
              section 103 of the Personal Responsibility and Work Opportunity
              Reconciliation Act of 1996, the child poverty rate of the State
              has increased by 5 percent or more since the most recent prior
              statement under paragraph (1), the State shall prepare and
              submit to the Secretary a corrective action plan in accordance
              with paragraph (3).
                `(3) CONTENTS OF PLAN- A corrective action plan submitted
              under paragraph (2) shall outline the manner in which the State
              will reduce the child poverty rate in the State. The plan shall
              include a description of the actions to be taken by the State
              under such plan.
                `(4) COMPLIANCE WITH PLAN- A State that submits a corrective
              action plan that the Secretary has found contains the
              information required by this subsection shall implement the
              corrective action plan until the State determines that the 
              child poverty rate in the State is less than the lowest child
              poverty rate on the basis of which the State was required to
              submit the corrective action plan.
                `(5) METHODOLOGY- The Secretary shall prescribe regulations
              establishing the methodology by which a State shall determine
              the child poverty rate in the State. The methodology shall take
              into account factors including the number of children who
              receive free or reduced-price lunches, the number of food stamp
              households, and the county-by-county estimates of children in
              poverty as determined by the Census Bureau.
          `SEC. 414. STUDY BY THE CENSUS BUREAU.
            `(a) IN GENERAL- The Bureau of the Census shall continue to
          collect data on the 1992 and 1993 panels of the Survey of Income 
          and Program Participation as necessary to obtain such information 
          as will enable interested persons to evaluate the impact of the
          amendments made by title I of the Personal Responsibility and Work
          Opportunity Reconciliation Act of 1996 on a random national sample
          of recipients of assistance under State programs funded under this
          part and (as appropriate) other low-income families, and in doing
          so, shall pay particular attention to the issues of out-of-wedlock
          birth, welfare dependency, the beginning and end of welfare spells,
          and the causes of repeat welfare spells, and shall obtain
          information about the status of children participating in such
          panels.
            `(b) APPROPRIATION- Out of any money in the Treasury of the 
          United States not otherwise appropriated, there are appropriated
          $10,000,000 for each of fiscal years 1996, 1997, 1998, 1999, 2000,
          2001, and 2002 for payment to the Bureau of the Census to carry out
          subsection (a).
          `SEC. 415. WAIVERS.
            `(a) CONTINUATION OF WAIVERS- 
                `(1) WAIVERS IN EFFECT ON DATE OF ENACTMENT OF WELFARE REFORM- 
                    `(A) IN GENERAL- Except as provided in subparagraph (B),
                  if any waiver granted to a State under section 1115 of this
                  Act or otherwise which relates to the provision of
                  assistance under a State plan under this part (as in effect
                  on September 30, 1996) is in effect as of the date of the
                  enactment of the Personal Responsibility and Work
                  Opportunity Reconciliation Act of 1996, the amendments made
                  by the Personal Responsibility and Work Opportunity
                  Reconciliation Act of 1996 (other than by section 103(c) of
                  the Personal Responsibility and Work Opportunity
                  Reconciliation Act of 1996) shall not apply with respect to
                  the State before the expiration (determined without regard
                  to any extensions) of the waiver to the extent such
                  amendments are inconsistent with the waiver.
                    `(B) FINANCING LIMITATION- Notwithstanding any other
                  provision of law, beginning with fiscal year 1996, a State
                  operating under a waiver described in subparagraph (A) 
                  shall be entitled to payment under section 403 for the
                  fiscal year, in lieu of any other payment provided for in
                  the waiver.
                `(2) WAIVERS GRANTED SUBSEQUENTLY- 
                    `(A) IN GENERAL- Except as provided in subparagraph (B),
                  if any waiver granted to a State under section 1115 of this
                  Act or otherwise which relates to the provision of
                  assistance under a State plan under this part (as in effect
                  on September 30, 1996) is submitted to the Secretary before
                  the date of the enactment of the Personal Responsibility 
                  and Work Opportunity Reconciliation Act of 1996 and 
                  approved by the Secretary on or before July 1, 1997, and 
                  the State demonstrates to the satisfaction of the Secretary
                  that the waiver will not result in Federal expenditures
                  under title IV of this Act (as in effect without regard to
                  the amendments made by the Personal Responsibility and Work
                  Opportunity Reconciliation Act of 1996) that are greater
                  than would occur in the absence of the waiver, the
                  amendments made by the Personal Responsibility and Work
                  Opportunity Reconciliation Act of 1996 (other than by
                  section 103(c) of the Personal Responsibility and Work
                  Opportunity Reconciliation Act of 1996) shall not apply 
                  with respect to the State before the expiration (determined
                  without regard to any extensions) of the waiver to the
                  extent the amendments made by the Personal Responsibility
                  and Work Opportunity Reconciliation Act of 1996 are
                  inconsistent with the waiver.
                    `(B) NO EFFECT ON NEW WORK REQUIREMENTS- Notwithstanding
                  subparagraph (A), a waiver granted under section 1115 or
                  otherwise which relates to the provision of assistance 
                  under a State program funded under this part (as in effect
                  on September 30, 1996) shall not affect the applicability 
                  of section 407 to the State.
            `(b) STATE OPTION TO TERMINATE WAIVER- 
                `(1) IN GENERAL- A State may terminate a waiver described in
              subsection (a) before the expiration of the waiver.
                `(2) REPORT- A State which terminates a waiver under 
              paragraph (1) shall submit a report to the Secretary 
              summarizing the waiver and any available information concerning
              the result or effect of the waiver.
                `(3) HOLD HARMLESS PROVISION- 
                    `(A) IN GENERAL- Notwithstanding any other provision of
                  law, a State that, not later than the date described in
                  subparagraph (B) of this paragraph, submits a written
                  request to terminate a waiver described in subsection (a)
                  shall be held harmless for accrued cost neutrality
                  liabilities incurred under the waiver.
                    `(B) DATE DESCRIBED- The date described in this
                  subparagraph is 90 days following the adjournment of the
                  first regular session of the State legislature that begins
                  after the date of the enactment of the Personal
                  Responsibility and Work Opportunity Reconciliation Act of
                  1996.
            `(c) SECRETARIAL ENCOURAGEMENT OF CURRENT WAIVERS- The Secretary
          shall encourage any State operating a waiver described in 
          subsection (a) to continue the waiver and to evaluate, using random
          sampling and other characteristics of accepted scientific
          evaluations, the result or effect of the waiver.
            `(d) CONTINUATION OF INDIVIDUAL WAIVERS- A State may elect to
          continue 1 or more individual waivers described in sub-section (a).
          `SEC. 416. ADMINISTRATION.
            `The programs under this part and part D shall be administered by
          an Assistant Secretary for Family Support within the Department of
          Health and Human Services, who shall be appointed by the President,
          by and with the advice and consent of the Senate, and who shall be
          in addition to any other Assistant Secretary of Health and Human
          Services provided for by law, and the Secretary shall reduce the
          Federal workforce within the Department of Health and Human 
          Services by an amount equal to the sum of 75 percent of the
          full-time equivalent positions at such Department that relate to 
          any direct spending program, or any program funded through
          discretionary spending, that has been converted into a block grant
          program under the Personal Responsibility and Work Opportunity Act
          of 1996 and the amendments made by such Act, and by an amount equal
          to 75 percent of that portion of the total full-time equivalent
          departmental management positions at such Department that bears the
          same relationship to the amount appropriated for any direct 
          spending program, or any program funded through discretionary
          spending, that has been converted into a block grant program under
          the Personal Responsibility and Work Opportunity Act of 1996 and 
          the amendments made by such Act, as such amount relates to the 
          total amount appropriated for use by such Department, and,
          notwithstanding any other provision of law, the Secretary shall 
          take such actions as may be necessary, including reductions in 
          force actions, consistent with sections 3502 and 3595 of title 5,
          United States Code, to reduce the full-time equivalent positions
          within the Department of Health and Human Services by 245 full-time
          equivalent positions related to the program converted into a block
          grant under the amendment made by section 2103 of the Personal
          Responsibility and Work Opportunity Act of 1996, and by 60 
          full-time equivalent managerial positions in the Department.
          `SEC. 417. LIMITATION ON FEDERAL AUTHORITY.
            `No officer or employee of the Federal Government may regulate 
          the conduct of States under this part or enforce any pro-vision of
          this part, except to the extent expressly provided in this part.';
          and
                (2) by inserting after such section 418 the following:
          `SEC. 419. DEFINITIONS.
            `As used in this part:
                `(1) ADULT- The term `adult' means an individual who is not a
              minor child.
                `(2) MINOR CHILD- The term `minor child' means an individual
              who--
                    `(A) has not attained 18 years of age; or
                    `(B) has not attained 19 years of age and is a full-time
                  student in a secondary school (or in the equivalent level 
                  of vocational or technical training).
                `(3) FISCAL YEAR- The term `fiscal year' means any 12-month
              period ending on September 30 of a calendar year.
                `(4) INDIAN, INDIAN TRIBE, AND TRIBAL ORGANIZATION- 
                    `(A) IN GENERAL- Except as provided in subparagraph (B),
                  the terms `Indian', `Indian tribe', and `tribal
                  organization' have the meaning given such terms by section 
                  4 of the Indian Self-Determination and Education Assistance
                  Act (25 U.S.C. 450b).
                    `(B) SPECIAL RULE FOR INDIAN TRIBES IN ALASKA- The term
                  `Indian tribe' means, with respect to the State of Alaska,
                  only the Metlakatla Indian Community of the Annette Islands
                  Reserve and the following Alaska Native regional nonprofit
                  corporations:
                        `(i) Arctic Slope Native Association.
                        `(ii) Kawerak, Inc.
                        `(iii) Maniilaq Association.
                        `(iv) Association of Village Council Presidents.
                        `(v) Tanana Chiefs Conference.
                        `(vi) Cook Inlet Tribal Council.
                        `(vii) Bristol Bay Native Association.
                        `(viii) Aleutian and Pribilof Island Association.
                        `(ix) Chugachmuit.
                        `(x) Tlingit Haida Central Council.
                        `(xi) Kodiak Area Native Association.
                        `(xii) Copper River Native Association.
                `(5) STATE- Except as otherwise specifically provided, the
              term `State' means the 50 States of the United States, the
              District of Columbia, the Commonwealth of Puerto Rico, the
              United States Virgin Islands, Guam, and American Samoa.'.
            (b) GRANTS TO OUTLYING AREAS- Section 1108 (42 U.S.C. 1308) is
          amended--
                (1) by striking subsections (d) and (e);
                (2) by redesignating subsection (c) as subsection (f); and
                (3) by striking all that precedes subsection (c) and 
              inserting the following:
          `SEC. 1108. ADDITIONAL GRANTS TO PUERTO RICO, THE VIRGIN ISLANDS,
                            GUAM, AND AMERICAN SAMOA; LIMITATION ON TOTAL
                            PAYMENTS.
            `(a) LIMITATION ON TOTAL PAYMENTS TO EACH TERRITORY-
          Notwithstanding any other provision of this Act, the total amount
          certified by the Secretary of Health and Human Services under 
          titles I, X, XIV, and XVI, under parts A and E of title IV, and
          under subsection (b) of this section, for payment to any territory
          for a fiscal year shall not exceed the ceiling amount for the
          territory for the fiscal year.
            `(b) ENTITLEMENT TO MATCHING GRANT- 
                `(1) IN GENERAL- Each territory shall be entitled to receive
              from the Secretary for each fiscal year a grant in an amount
              equal to 75 percent of the amount (if any) by which--
                    `(A) the total expenditures of the territory during the
                  fiscal year under the territory programs funded under parts
                  A and E of title IV; exceeds
                    `(B) the sum of--
                        `(i) the amount of the family assistance grant 
                      payable to the territory without regard to section 409;
                      and
                        `(ii) the total amount expended by the territory
                      during fiscal year 1995 pursuant to parts A and F of
                      title IV (as so in effect), other than for child care.
                `(2) APPROPRIATION- Out of any money in the Treasury of the
              United States not otherwise appropriated, there are 
              appropriated for fiscal years 1997 through 2002, such sums as
              are necessary for grants under this paragraph.
            `(c) DEFINITIONS- As used in this section:
                `(1) TERRITORY- The term `territory' means Puerto Rico, the
              Virgin Islands, Guam, and American Samoa.
                `(2) CEILING AMOUNT- The term `ceiling amount' means, with
              respect to a territory and a fiscal year, the mandatory ceiling
              amount with respect to the territory, reduced for the fiscal
              year in accordance with subsection (e), and reduced by the
              amount of any penalty imposed on the territory under any
              provision of law specified in subsection (a) during the fiscal
              year.
                `(3) FAMILY ASSISTANCE GRANT- The term `family assistance
              grant' has the meaning given such term by section 403(a)(1)(B).
                `(4) MANDATORY CEILING AMOUNT- The term `mandatory ceiling
              amount' means--
                    `(A) $107,255,000 with respect to Puerto Rico;
                    `(B) $4,686,000 with respect to Guam;
                    `(C) $3,554,000 with respect to the Virgin Islands; and
                    `(D) $1,000,000 with respect to American Samoa.
                `(5) TOTAL AMOUNT EXPENDED BY THE TERRITORY- The term `total
              amount expended by the territory'--
                    `(A) does not include expenditures during the fiscal year
                  from amounts made available by the Federal Government; and
                    `(B) when used with respect to fiscal year 1995, also 
                  does not include--
                        `(i) expenditures during fiscal year 1995 under
                      subsection (g) or (i) of section 402 (as in effect on
                      September 30, 1995); or
                        `(ii) any expenditures during fiscal year 1995 for
                      which the territory (but for section 1108, as in effect
                      on September 30, 1995) would have received 
                      reimbursement from the Federal Government.
            `(d) AUTHORITY TO TRANSFER FUNDS TO CERTAIN PROGRAMS- A territory
          to which an amount is paid under subsection (b) of this section may
          use the amount in accordance with section 404(d).
            `(e) MAINTENANCE OF EFFORT- The ceiling amount with respect to a
          territory shall be reduced for a fiscal year by an amount equal to
          the amount (if any) by which--
                `(1) the total amount expended by the territory under all
              programs of the territory operated pursuant to the provisions 
              of law specified in subsection (a) (as such provisions were in
              effect for fiscal year 1995) for fiscal year 1995; exceeds
                `(2) the total amount expended by the territory under all
              programs of the territory that are funded under the provisions
              of law specified in subsection (a) for the fiscal year that
              immediately precedes the fiscal year referred to in the matter
              preceding paragraph (1).'.
            (c) ELIMINATION OF CHILD CARE PROGRAMS UNDER THE SOCIAL SECURITY
          ACT-
                (1) AFDC AND TRANSITIONAL CHILD CARE PROGRAMS- Section 402 
              (42 U.S.C. 602) is amended by striking sub-section (g).
                (2) AT-RISK CHILD CARE PROGRAM- 
                    (A) AUTHORIZATION- Section 402 (42 U.S.C. 602) is amended
                  by striking subsection (i).
                    (B) FUNDING PROVISIONS- Section 403 (42 U.S.C. 603) is
                  amended by striking subsection (n).
          SEC. 104. SERVICES PROVIDED BY CHARITABLE, RELIGIOUS, OR PRIVATE
                            ORGANIZATIONS.
            (a) IN GENERAL- 
                (1) STATE OPTIONS- A State may--
                    (A) administer and provide services under the programs
                  described in subparagraphs (A) and (B)(i) of paragraph (2)
                  through contracts with charitable, religious, or private
                  organizations; and
                    (B) provide beneficiaries of assistance under the 
                  programs described in subparagraphs (A) and (B)(ii) of
                  paragraph (2) with certificates, vouchers, or other forms 
                  of disbursement which are redeemable with such organizations.
                (2) PROGRAMS DESCRIBED- The programs described in this
              paragraph are the following programs:
                    (A) A State program funded under part A of title IV of 
                  the Social Security Act (as amended by section 103(a) of
                  this Act).
                    (B) Any other program established or modified under title
                  I or II of this Act, that--
                        (i) permits contracts with organizations; or
                        (ii) permits certificates, vouchers, or other forms 
                      of disbursement to be provided to beneficiaries, as a
                      means of providing assistance.
            (b) RELIGIOUS ORGANIZATIONS- The purpose of this section is to
          allow States to contract with religious organizations, or to allow
          religious organizations to accept certificates, vouchers, or other
          forms of disbursement under any program described in subsection
          (a)(2), on the same basis as any other nongovernmental provider
          without impairing the religious character of such organizations, 
          and without diminishing the religious freedom of beneficiaries of
          assistance funded under such program.
            (c) NONDISCRIMINATION AGAINST RELIGIOUS ORGANIZATIONS- In the
          event a State exercises its authority under subsection (a),
          religious organizations are eligible, on the same basis as any 
          other private organization, as contractors to provide assistance, 
          or to accept certificates, vouchers, or other forms of 
          disbursement, under any program described in subsection (a)(2) so
          long as the programs are implemented consistent with the
          Establishment Clause of the United States Constitution. Except as
          provided in subsection (k), neither the Federal Government nor a
          State receiving funds under such programs shall discriminate 
          against an organization which is or applies to be a contractor to
          provide assistance, or which accepts certificates, vouchers, or
          other forms of disbursement, on the basis that the organization has
          a religious character.
            (d) RELIGIOUS CHARACTER AND FREEDOM- 
                (1) RELIGIOUS ORGANIZATIONS- A religious organization with a
              contract described in subsection (a)(1)(A), or which accepts
              certificates, vouchers, or other forms of disbursement under
              subsection (a)(1)(B), shall retain its independence from
              Federal, State, and local governments, including such
              organization's control over the definition, development,
              practice, and expression of its religious beliefs.
                (2) ADDITIONAL SAFEGUARDS- Neither the Federal Government nor
              a State shall require a religious organization to--
                    (A) alter its form of internal governance; or
                    (B) remove religious art, icons, scripture, or other
                  symbols;
              in order to be eligible to contract to provide assistance, or 
              to accept certificates, vouchers, or other forms of
              disbursement, funded under a program described in subsection
              (a)(2).
            (e) RIGHTS OF BENEFICIARIES OF ASSISTANCE- 
                (1) IN GENERAL- If an individual described in paragraph (2)
              has an objection to the religious character of the organization
              or institution from which the individual receives, or would
              receive, assistance funded under any program described in
              subsection (a)(2), the State in which the individual resides
              shall provide such individual (if otherwise eligible for such
              assistance) within a reasonable period of time after the date 
              of such objection with assistance from an alternative provider
              that is accessible to the individual and the value of which is
              not less than the value of the assistance which the individual
              would have received from such organization.
                (2) INDIVIDUAL DESCRIBED- An individual described in this
              paragraph is an individual who receives, applies for, or
              requests to apply for, assistance under a program described in
              subsection (a)(2).
            (f) EMPLOYMENT PRACTICES- A religious organization's exemption
          provided under section 702 of the Civil Rights Act of 1964 (42
          U.S.C. 2000e-1a) regarding employment practices shall not be
          affected by its participation in, or receipt of funds from, 
          programs described in subsection (a)(2).
            (g) NONDISCRIMINATION AGAINST BENEFICIARIES- Except as otherwise
          provided in law, a religious organization shall not discriminate
          against an individual in regard to rendering assistance funded 
          under any program described in subsection (a)(2) on the basis of
          religion, a religious belief, or refusal to actively participate in
          a religious practice.
            (h) FISCAL ACCOUNTABILITY- 
                (1) IN GENERAL- Except as provided in paragraph (2), any
              religious organization contracting to provide assistance funded
              under any program described in subsection (a)(2) shall be
              subject to the same regulations as other contractors to account
              in accord with generally accepted auditing principles for the
              use of such funds provided under such programs.
                (2) LIMITED AUDIT- If such organization segregates Federal
              funds provided under such programs into separate accounts, then
              only the financial assistance provided with such funds shall be
              subject to audit.
            (i) COMPLIANCE- Any party which seeks to enforce its rights under
          this section may assert a civil action for injunctive relief
          exclusively in an appropriate State court against the entity or
          agency that allegedly commits such violation.
            (j) LIMITATIONS ON USE OF FUNDS FOR CERTAIN PURPOSES- No funds
          provided directly to institutions or organizations to provide
          services and administer programs under subsection (a)(1)(A) shall 
          be expended for sectarian worship, instruction, or proselytization.
            (k) PREEMPTION- Nothing in this section shall be construed to
          preempt any provision of a State constitution or State statute that
          prohibits or restricts the expenditure of State funds in or by
          religious organizations.
          SEC. 105. CENSUS DATA ON GRANDPARENTS AS PRIMARY CAREGIVERS FOR
                            THEIR GRANDCHILDREN.
            (a) IN GENERAL- Not later than 90 days after the date of the
          enactment of this Act, the Secretary of Commerce, in carrying out
          section 141 of title 13, United States Code, shall expand the data
          collection efforts of the Bureau of the Census (in this section
          referred to as the `Bureau') to enable the Bureau to collect
          statistically significant data, in connection with its decennial
          census and its mid-decade census, concerning the growing trend of
          grandparents who are the primary caregivers for their grandchildren.
            (b) EXPANDED CENSUS QUESTION- In carrying out subsection (a), the
          Secretary of Commerce shall expand the Bureau's census question 
          that details households which include both grandparents and their
          grandchildren. The expanded question shall be formulated to
          distinguish between the following households:
                (1) A household in which a grandparent temporarily provides a
              home for a grandchild for a period of weeks or months during
              periods of parental distress.
                (2) A household in which a grandparent provides a home for a
              grandchild and serves as the primary caregiver for the
              grandchild.
          SEC. 106. REPORT ON DATA PROCESSING.
            (a) IN GENERAL- Within 6 months after the date of the enactment 
          of this Act, the Secretary of Health and Human Services shall
          prepare and submit to the Congress a report on--
                (1) the status of the automated data processing systems
              operated by the States to assist management in the
              admin-istration of State programs under part A of title IV of
              the Social Security Act (whether in effect before or after
              October 1, 1995); and
                (2) what would be required to establish a system cap-able of--
                    (A) tracking participants in public programs over time; and
                    (B) checking case records of the States to determine
                  whether individuals are participating in public programs of
                  2 or more States.
            (b) PREFERRED CONTENTS- The report required by subsection (a)
          should include--
                (1) a plan for building on the automated data processing
              systems of the States to establish a system with the
              capabilities described in subsection (a)(2); and
                (2) an estimate of the amount of time required to establish
              such a system and of the cost of establishing such a system.
          SEC. 107. STUDY ON ALTERNATIVE OUTCOMES MEASURES.
            (a) STUDY- The Secretary shall, in cooperation with the States,
          study and analyze outcomes measures for evaluating the success of
          the States in moving individuals out of the welfare system through
          employment as an alternative to the minimum participation rates
          described in section 407 of the Social Security Act. The study 
          shall include a determination as to whether such alternative
          outcomes measures should be applied on a national or a
          State-by-State basis and a preliminary assessment of the effects of
          section 409(a)(7)(C) of such Act.
            (b) REPORT- Not later than September 30, 1998, the Secretary 
          shall submit to the Committee on Finance of the Senate and the
          Committee on Ways and Means of the House of Represen-tatives a
          report containing the findings of the study required by subsection
          (a).
          SEC. 108. CONFORMING AMENDMENTS TO THE SOCIAL SECURITY ACT.
            (a) AMENDMENTS TO TITLE II- 
                (1) Section 205(c)(2)(C)(vi) (42 U.S.C. 405(c)(2)(C)(vi)), as
              so redesignated by section 321(a)(9)(B) of the Social Security
              Independence and Program Improvements Act of 1994, is amended--
                    (A) by inserting `an agency administering a program 
                  funded under part A of title IV or' before `an agency
                  operating'; and
                    (B) by striking `A or D of title IV of this Act' and
                  inserting `D of such title'.
                (2) Section 228(d)(1) (42 U.S.C. 428(d)(1)) is amended by
              inserting `under a State program funded under' before `part A 
              of title IV'.
            (b) AMENDMENTS TO PART B OF TITLE IV- Section 422(b)(2) (42 
          U.S.C. 622(b)(2)) is amended--
                (1) by striking `plan approved under part A of this title' 
              and inserting `program funded under part A'; and
                (2) by striking `part E of this title' and inserting `under
              the State plan approved under part E'.
            (c) AMENDMENTS TO PART D OF TITLE IV- 
                (1) Section 451 (42 U.S.C. 651) is amended by striking `aid'
              and inserting `assistance under a State program funded'.
                (2) Section 452(a)(10)(C) (42 U.S.C. 652(a)(10)(C)) is
              amended--
                    (A) by striking `aid to families with dependent children'
                  and inserting `assistance under a State program funded 
                  under part A';
                    (B) by striking `such aid' and inserting `such
                  assistance'; and
                    (C) by striking `under section 402(a)(26) or' and
                  inserting `pursuant to section 408(a)(3) or under section'.
                (3) Section 452(a)(10)(F) (42 U.S.C. 652(a)(10)(F)) is
              amended--
                    (A) by striking `aid under a State plan approved' and
                  inserting `assistance under a State program funded'; and
                    (B) by striking `in accordance with the standards 
                  referred to in section 402(a)(26)(B)(ii)' and inserting `by
                  the State'.
                (4) Section 452(b) (42 U.S.C. 652(b)) is amended in the first
              sentence by striking `aid under the State plan approved under
              part A' and inserting `assistance under the State program 
              funded under part A'.
                (5) Section 452(d)(3)(B)(i) (42 U.S.C. 652(d)(3)(B)(i)) is
              amended by striking `1115(c)' and inserting `1115(b)'.
                (6) Section 452(g)(2)(A)(ii)(I) (42 U.S.C.
              652(g)(2)(A)(ii)(I)) is amended by striking `aid is being paid
              under the State's plan approved under part A or E' and 
              inserting `assistance is being provided under the State program
              funded under part A'.
                (7) Section 452(g)(2)(A) (42 U.S.C. 652(g)(2)(A)) is amended
              in the matter following clause (iii) by striking `aid was being
              paid under the State's plan approved under part A or E' and
              inserting `assistance was being provided under the State 
              program funded under part A'.
                (8) Section 452(g)(2) (42 U.S.C. 652(g)(2)) is amended in the
              matter following subparagraph (B)--
                    (A) by striking `who is a dependent child' and inserting
                  `with respect to whom assistance is being provided under 
                  the State program funded under part A';
                    (B) by inserting `by the State' after `found'; and
                    (C) by striking `to have good cause for refusing to
                  cooperate under section 402(a)(26)' and inserting `to
                  qualify for a good cause or other exception to cooperation
                  pursuant to section 454(29)'.
                (9) Section 452(h) (42 U.S.C. 652(h)) is amended by striking
              `under section 402(a)(26)' and inserting `pursuant to section
              408(a)(3)'.
                (10) Section 453(c)(3) (42 U.S.C. 653(c)(3)) is amended by
              striking `aid under part A of this title' and inserting
              `assistance under a State program funded under part A'.
                (11) Section 454(5)(A) (42 U.S.C. 654(5)(A)) is amended--
                    (A) by striking `under section 402(a)(26)' and inserting
                  `pursuant to section 408(a)(3)'; and
                    (B) by striking `; except that this paragraph shall not
                  apply to such payments for any month following the first
                  month in which the amount collected is sufficient to make
                  such family ineligible for assistance under the State plan
                  approved under part A;' and inserting a comma.
                (12) Section 454(6)(D) (42 U.S.C. 654(6)(D)) is amended by
              striking `aid under a State plan approved' and inserting
              `assistance under a State program funded'.
                (13) Section 456(a)(1) (42 U.S.C. 656(a)(1)) is amended by
              striking `under section 402(a)(26)'.
                (14) Section 466(a)(3)(B) (42 U.S.C. 666(a)(3)(B)) is amended
              by striking `402(a)(26)' and inserting `408(a)(3)'.
                (15) Section 466(b)(2) (42 U.S.C. 666(b)(2)) is amended by
              striking `aid' and inserting `assistance under a State program
              funded'.
                (16) Section 469(a) (42 U.S.C. 669(a)) is amended--
                    (A) by striking `aid under plans approved' and inserting
                  `assistance under State programs funded'; and
                    (B) by striking `such aid' and inserting `such assistance'.
            (d) AMENDMENTS TO PART E OF TITLE IV- 
                (1) Section 470 (42 U.S.C. 670) is amended--
                    (A) by striking `would be' and inserting `would have
                  been'; and
                    (B) by inserting `(as such plan was in effect on June 1,
                  1995)' after `part A'.
                (2) Section 471(a)(17) (42 U.S.C. 671(a)(17)) is amended by
              striking `plans approved under parts A and D' and inserting
              `program funded under part A and plan approved under part D'.
                (3) Section 472(a) (42 U.S.C. 672(a)) is amended--
                    (A) in the matter preceding paragraph (1)--
                        (i) by striking `would meet' and inserting `would 
                      have met';
                        (ii) by inserting `(as such sections were in effect 
                      on June 1, 1995)' after `407'; and
                        (iii) by inserting `(as so in effect)' after 
                      `406(a)'; and
                    (B) in paragraph (4)--
                        (i) in subparagraph (A)--
            (I) by inserting `would have' after `(A)'; and
            (II) by inserting `(as in effect on June 1, 1995)' after `section
          402'; and
                        (ii) in subparagraph (B)(ii), by inserting `(as in
                      effect on June 1, 1995)' after `406(a)'.
                (4) Section 472(h) (42 U.S.C. 672(h)) is amended to read as
              follows:
            `(h)(1) For purposes of title XIX, any child with respect to whom
          foster care maintenance payments are made under this section is
          deemed to be a dependent child as defined in section 406 (as in
          effect as of June 1, 1995) and deemed to be a recipient of aid to
          families with dependent children under part A of this title (as so
          in effect). For purposes of title XX, any child with respect to 
          whom foster care maintenance payments are made under this section 
          is deemed to be a minor child in a needy family under a State
          program funded under part A of this title and is deemed to be a
          recipient of assistance under such part.
            `(2) For purposes of paragraph (1), a child whose costs in a
          foster family home or child care institution are covered by the
          foster care maintenance payments being made with respect to the
          child's minor parent, as provided in section 475(4)(B), shall be
          considered a child with respect to whom foster care maintenance
          payments are made under this section.'.
                (5) Section 473(a)(2) (42 U.S.C. 673(a)(2)) is amended--
                    (A) in subparagraph (A)(i)--
                        (i) by inserting `(as such sections were in effect on
                      June 1, 1995)' after `407';
                        (ii) by inserting `(as so in effect)' after 
                      `specified in section 406(a)'; and
                        (iii) by inserting `(as such section was in effect on
                      June 1, 1995)' after `403';
                    (B) in subparagraph (B)(i)--
                        (i) by inserting `would have' after `(B)(i)'; and
                        (ii) by inserting `(as in effect on June 1, 1995)'
                      after `section 402'; and
                    (C) in subparagraph (B)(ii)(II), by inserting `(as in
                  effect on June 1, 1995)' after `406(a)'.
                (6) Section 473(b) (42 U.S.C. 673(b)) is amended to read as
              follows:
            `(b)(1) For purposes of title XIX, any child who is described in
          paragraph (3) is deemed to be a dependent child as defined in
          section 406 (as in effect as of June 1, 1995) and deemed to be a
          recipient of aid to families with dependent children under part A 
          of this title (as so in effect) in the State where such child
          resides.
            `(2)  For purposes of title XX, any child who is described in
          paragraph (3) is deemed to be a minor child in a needy family under
          a State program funded under part A of this title and deemed to be 
          a recipient of assistance under such part.
            `(3) A child described in this paragraph is any child--
                `(A)(i) who is a child described in subsection (a)(2), and
                `(ii) with respect to whom an adoption assistance agreement 
              is in effect under this section (whether or not adoption
              assistance payments are provided under the agreement or are
              being made under this section), including any such child who 
              has been placed for adoption in accordance with applicable 
              State and local law (whether or not an interlocutory or other
              judicial decree of adoption has been issued), or
                `(B) with respect to whom foster care maintenance payments 
              are being made under section 472.
            `(4) For purposes of paragraphs (1) and (2), a child whose costs
          in a foster family home or child-care institution are covered by 
          the foster care maintenance payments being made with respect to the
          child's minor parent, as provided in section 475(4)(B), shall be
          considered a child with respect to whom foster care maintenance
          payments are being made under section 472.'.
            (e) REPEAL OF PART F OF TITLE IV- Part F of title IV (42 U.S.C.
          681-687) is repealed.
            (f) AMENDMENT TO TITLE X- Section 1002(a)(7) (42 U.S.C.
          1202(a)(7)) is amended by striking `aid to families with dependent
          children under the State plan approved under section 402 of this
          Act' and inserting `assistance under a State program funded under
          part A of title IV'.
            (g) AMENDMENTS TO TITLE XI- 
                (1) Section 1109 (42 U.S.C. 1309) is amended by striking `or
              part A of title IV,'.
                (2) Section 1115 (42 U.S.C. 1315) is amended--
                    (A) in subsection (a)(2)--
                        (i) by inserting `(A)' after `(2)';
                        (ii) by striking `403,';
                        (iii) by striking the period at the end and inserting
                      `, and'; and
                        (iv) by adding at the end the following new
                      subparagraph:
                `(B) costs of such project which would not otherwise be a
              permissible use of funds under part A of title IV and which are
              not included as part of the costs of projects under section
              1110, shall to the extent and for the period prescribed by the
              Secretary, be regarded as a permissible use of funds under such
              part.';
                    (B) in subsection (c)(3), by striking `the program of aid
                  to families with dependent children' and inserting `part A
                  of such title'; and
                    (C) by striking subsection (b) and redesignating
                  subsections (c) and (d) as subsections (b) and (c),
                  respectively.
                (3) Section 1116 (42 U.S.C. 1316) is amended--
                    (A) in each of subsections (a)(1), (b), and (d), by
                  striking `or part A of title IV,'; and
                    (B) in subsection (a)(3), by striking `404,'.
                (4) Section 1118 (42 U.S.C. 1318) is amended--
                    (A) by striking `403(a),';
                    (B) by striking `and part A of title IV,'; and
                    (C) by striking `, and shall, in the case of American
                  Samoa, mean 75 per centum with respect to part A of title
                  IV'.
                (5) Section 1119 (42 U.S.C. 1319) is amended--
                    (A) by striking `or part A of title IV'; and
                    (B) by striking `403(a),'.
                (6) Section 1133(a) (42 U.S.C. 1320b-3(a)) is amended by
              striking `or part A of title IV,'.
                (7) Section 1136 (42 U.S.C. 1320b-6) is repealed.
                (8) Section 1137 (42 U.S.C. 1320b-7) is amended--
                    (A) in subsection (b), by striking paragraph (1) and
                  inserting the following:
                `(1) any State program funded under part A of title IV of 
              this Act;'; and
                    (B) in subsection (d)(1)(B)--
                        (i) by striking `In this subsection--' and all that
                      follows through `(ii) in' and inserting `In this
                      subsection, in';
                        (ii) by redesignating subclauses (I), (II), and (III)
                      as clauses (i), (ii), and (iii); and
                        (iii) by moving such redesignated material 2 ems to
                      the left.
            (h) AMENDMENT TO TITLE XIV- Section 1402(a)(7) (42 U.S.C.
          1352(a)(7)) is amended by striking `aid to families with dependent
          children under the State plan approved under section 402 of this
          Act' and inserting `assistance under a State program funded under
          part A of title IV'.
            (i) AMENDMENT TO TITLE XVI AS IN EFFECT WITH RESPECT TO THE
          TERRITORIES- Section 1602(a)(11), as in effect without regard to 
          the amendment made by section 301 of the Social Security Amendments
          of 1972 (42 U.S.C. 1382 note), is amended by striking `aid under 
          the State plan approved' and inserting `assistance under a State
          program funded'.
            (j) AMENDMENT TO TITLE XVI AS IN EFFECT WITH RESPECT TO THE
          STATES- Section 1611(c)(5)(A) (42 U.S.C. 1382(c)(5)(A)) is amended
          to read as follows: `(A) a State program funded under part A of
          title IV,'.
            (k) AMENDMENT TO TITLE XIX- Section 1902(j) (42 U.S.C. 1396a(j))
          is amended by striking `1108(c)' and inserting `1108(f)'.
          SEC. 109. CONFORMING AMENDMENTS TO THE FOOD STAMP ACT OF 1977 AND
                            RELATED PROVISIONS.
            (a) Section 5 of the Food Stamp Act of 1977 (7 U.S.C. 2014) is
          amended--
                (1) in the second sentence of subsection (a), by striking
              `plan approved' and all that follows through `title IV of the
              Social Security Act' and inserting `program funded under part A
              of title IV of the Social Security Act (42 U.S.C. 601 et seq.)';
                (2) in subsection (d)--
                    (A) in paragraph (5), by striking `assistance to families
                  with dependent children' and inserting `assistance under a
                  State program funded'; and
                    (B) by striking paragraph (13) and redesignating
                  paragraphs (14), (15), and (16) as paragraphs (13), (14),
                  and (15), respectively;
                (3) in subsection (j), by striking `plan approved under part 
              A of title IV of such Act (42 U.S.C. 601 et seq.)' and 
              inserting `program funded under part A of title IV of the Act
              (42 U.S.C. 601 et seq.)'; and
                (4) by striking subsection (m).
            (b) Section 6 of such Act (7 U.S.C. 2015) is amended--
                (1) in subsection (c)(5), by striking `the State plan
              approved' and inserting `the State program funded'; and
                (2) in subsection (e)(6), by striking `aid to families with
              dependent children' and inserting `benefits under a State
              program funded'.
            (c) Section 16(g)(4) of such Act (7 U.S.C. 2025(g)(4)) is amended
          by striking `State plans under the Aid to Families with Dependent
          Children Program under' and inserting `State programs funded under
          part A of'.
            (d) Section 17 of such Act (7 U.S.C. 2026) is amended--
                (1) in the first sentence of subsection (b)(1)(A), by 
              striking `to aid to families with dependent children under part
              A of title IV of the Social Security Act' and inserting `or are
              receiving assistance under a State program funded under part A
              of title IV of the Social Security Act (42 U.S.C. 601 et 
              seq.)'; and
                (2) in subsection (b)(3), by adding at the end the following
              new subparagraph:
            `(I) The Secretary may not grant a waiver under this paragraph on
          or after the date of enactment of this subparagraph. Any reference
          in this paragraph to a provision of title IV of the Social Security
          Act shall be deemed to be a reference to such provision as in 
          effect on the day before such date.';
            (e) Section 20 of such Act (7 U.S.C. 2029) is amended--
                (1) in subsection (a)(2)(B) by striking `operating--' and all
              that follows through `(ii) any other' and inserting `operating
              any'; and
                (2) in subsection (b)--
                    (A) in paragraph (1)--
                        (i) by striking `(b)(1) A household' and inserting
                      `(b) A household'; and
                        (ii) in subparagraph (B), by striking `training
                      program' and inserting `activity';
                    (B) by striking paragraph (2); and
                    (C) by redesignating subparagraphs (A) through (F) as
                  paragraphs (1) through (6), respectively.
            (f) Section 5(h)(1) of the Agriculture and Consumer Protection 
          Act of 1973 (Public Law 93-186; 7 U.S.C. 612c note) is amended by
          striking `the program for aid to families with dependent children'
          and inserting `the State program funded'.
            (g) Section 9 of the National School Lunch Act (42 U.S.C. 1758) 
          is amended--
                (1) in subsection (b)--
                    (A) in paragraph (2)(C)(ii)(II)--
                        (i) by striking `program for aid to families with
                      dependent children' and inserting `State program
                      funded'; and
                        (ii) by inserting before the period at the end the
                      following: `that the Secretary determines complies with
                      standards established by the Secretary that ensure that
                      the standards under the State program are comparable to
                      or more restrictive than those in effect on June 1,
                      1995'; and
                    (B) in paragraph (6)--
                        (i) in subparagraph (A)(ii)--
            (I) by striking `an AFDC assistance unit (under the aid to
          families with dependent children program authorized' and inserting
          `a family (under the State program funded'; and
            (II) by striking `, in a State' and all that follows through
          `9902(2)))' and inserting `that the Secretary determines complies
          with standards established by the Secretary that ensure that the
          standards under the State program are comparable to or more
          restrictive than those in effect on June 1, 1995'; and
                        (ii) in subparagraph (B), by striking `aid to 
                      families with dependent children' and inserting
                      `assistance under the State program funded under part A
                      of title IV of the Social Security Act (42 U.S.C. 601 
                      et seq.) that the Secretary determines complies with
                      standards established by the Secretary that ensure that
                      the standards under the State program are comparable to
                      or more restrictive than those in effect on June 1,
                      1995'; and
                (2) in subsection (d)(2)(C)--
                    (A) by striking `program for aid to families with
                  dependent children' and inserting `State program funded'; and
                    (B) by inserting before the period at the end the
                  following: `that the Secretary determines complies with
                  standards established by the Secretary that ensure that the
                  standards under the State program are comparable to or more
                  restrictive than those in effect on June 1, 1995'.
            (h) Section 17(d)(2)(A)(ii)(II) of the Child Nutrition Act of 
          1966 (42 U.S.C. 1786(d)(2)(A)(ii)(II)) is amended--
                (1) by striking `program for aid to families with dependent
              children established' and inserting `State program funded'; and
                (2) by inserting before the semicolon the following: `that 
              the Secretary determines complies with standards established by
              the Secretary that ensure that the standards under the State
              program are comparable to or more restrictive than those in
              effect on June 1, 1995'.
          SEC. 110. CONFORMING AMENDMENTS TO OTHER LAWS.
            (a) Subsection (b) of section 508 of the Unemployment 
          Compensation Amendments of 1976 (42 U.S.C. 603a; Public Law 94-566;
          90 Stat. 2689) is amended to read as follows:
            `(b) PROVISION FOR REIMBURSEMENT OF EXPENSES- For purposes of
          section 455 of the Social Security Act, expenses incurred to
          reimburse State employment offices for furnishing information
          requested of such offices--
                `(1) pursuant to the third sentence of section 3(a) of the 
              Act entitled `An Act to provide for the establishment of a
              national employment system and for cooperation with the States
              in the promotion of such system, and for other purposes',
              approved June 6, 1933 (29 U.S.C. 49b(a)), or
                `(2) by a State or local agency charged with the duty of
              carrying a State plan for child support approved under part D 
              of title IV of the Social Security Act,
          shall be considered to constitute expenses incurred in the
          administration of such State plan.'.
            (b) Section 9121 of the Omnibus Budget Reconciliation Act of 1987
          (42 U.S.C. 602 note) is repealed.
            (c) Section 9122 of the Omnibus Budget Reconciliation Act of 1987
          (42 U.S.C. 602 note) is repealed.
            (d) Section 221 of the Housing and Urban-Rural Recovery Act of
          1983 (42 U.S.C. 602 note), relating to treatment under AFDC of
          certain rental payments for federally assisted housing, is repealed.
            (e) Section 159 of the Tax Equity and Fiscal Responsibility Act 
          of 1982 (42 U.S.C. 602 note) is repealed.
            (f) Section 202(d) of the Social Security Amendments of 1967 (81
          Stat. 882; 42 U.S.C. 602 note) is repealed.
            (g) Section 903 of the Stewart B. McKinney Homeless Assistance
          Amendments Act of 1988 (42 U.S.C. 11381 note), relating to
          demonstration projects to reduce number of AFDC families in welfare
          hotels, is amended--
                (1) in subsection (a), by striking `aid to families with
              dependent children under a State plan approved' and inserting
              `assistance under a State program funded'; and
                (2) in subsection (c), by striking `aid to families with
              dependent children in the State under a State plan approved' 
              and inserting `assistance in the State under a State program
              funded'.
            (h) The Higher Education Act of 1965 (20 U.S.C. 1001 et seq.) is
          amended--
                (1) in section 404C(c)(3) (20 U.S.C. 1070a-23(c)(3)), by
              striking `(Aid to Families with Dependent Children)'; and
                (2) in section 480(b)(2) (20 U.S.C. 1087vv(b)(2)), by 
              striking `aid to families with dependent children under a State
              plan approved' and inserting `assistance under a State program
              funded'.
            (i) The Carl D. Perkins Vocational and Applied Technology
          Education Act (20 U.S.C. 2301 et seq.) is amended--
                (1) in section 231(d)(3)(A)(ii) (20 U.S.C. 
              2341(d)(3)(A)(ii)), by striking `The program for aid to
              dependent children' and inserting `The State program funded';
                (2) in section 232(b)(2)(B) (20 U.S.C. 2341a(b)(2)(B)), by
              striking `the program for aid to families with dependent
              children' and inserting `the State program funded'; and
                (3) in section 521(14)(B)(iii) (20 U.S.C. 2471(14)(B)(iii)),
              by striking `the program for aid to families with dependent
              children' and inserting `the State program funded'.
            (j) The Elementary and Secondary Education Act of 1965 (20 U.S.C.
          2701 et seq.) is amended--
                (1) in section 1113(a)(5) (20 U.S.C. 6313(a)(5)), by striking
              `Aid to Families with Dependent Children program' and inserting
              `State program funded under part A of title IV of the Social
              Security Act';
                (2) in section 1124(c)(5) (20 U.S.C. 6333(c)(5)), by striking
              `the program of aid to families with dependent children under a
              State plan approved under' and inserting `a State program 
              funded under part A of'; and
                (3) in section 5203(b)(2) (20 U.S.C. 7233(b)(2))--
                    (A) in subparagraph (A)(xi), by striking `Aid to Families
                  with Dependent Children benefits' and inserting `assistance
                  under a State program funded under part A of title IV of 
                  the Social Security Act'; and
                    (B) in subparagraph (B)(viii), by striking `Aid to
                  Families with Dependent Children' and inserting `assistance
                  under the State program funded under part A of title IV of
                  the Social Security Act'.
            (k) The 4th proviso of chapter VII of title I of Public Law 99-88
          (25 U.S.C. 13d-1) is amended to read as follows: ` [Italic->]
          Provided further, [<-Italic]  That general assistance payments made
          by the Bureau of Indian Affairs shall be made--
                `(1) after April 29, 1985, and before October 1, 1995, on the
              basis of Aid to Families with Dependent Children (AFDC)
              standards of need; and
                `(2) on and after October 1, 1995, on the basis of standards
              of need established under the State program funded under part A
              of title IV of the Social Security Act,
          except that where a State ratably reduces its AFDC or State program
          payments, the Bureau shall reduce general assistance payments in
          such State by the same percentage as the State has reduced the AFDC
          or State program payment.'.
            (l) The Internal Revenue Code of 1986 (26 U.S.C. 1 et seq.) is
          amended--
                (1) in section 51(d)(9) (26 U.S.C. 51(d)(9)), by striking all
              that follows `agency as' and inserting `being eligible for
              financial assistance under part A of title IV of the Social
              Security Act and as having continually received such financial
              assistance during the 90-day period which immediately precedes
              the date on which such individual is hired by the employer.';
                (2) in section 3304(a)(16) (26 U.S.C. 3304(a)(16)), by
              striking `eligibility for aid or services,' and all that 
              follows through `children approved' and inserting `eligibility
              for assistance, or the amount of such assistance, under a State
              program funded';
                (3) in section 6103(l)(7)(D)(i) (26 U.S.C. 6103(l)(7)(D)(i)),
              by striking `aid to families with dependent children provided
              under a State plan approved' and inserting `a State program
              funded';
                (4) in section 6103(l)(10) (26 U.S.C. 6103(l)(10))--
                    (A) by striking `(c) or (d)' each place it appears and
                  inserting `(c), (d), or (e)'; and
                    (B) by adding at the end of subparagraph (B) the 
                  following new sentence: `Any return information disclosed
                  with respect to section 6402(e) shall only be disclosed to
                  officers and employees of the State agency requesting such
                  information.';
                (5) in section 6103(p)(4) (26 U.S.C. 6103(p)(4)), in the
              matter preceding subparagraph (A)--
                    (A) by striking `(5), (10)' and inserting `(5)'; and
                    (B) by striking `(9), or (12)' and inserting `(9), (10),
                  or (12)';
                (6) in section 6334(a)(11)(A) (26 U.S.C. 6334(a)(11)(A)), by
              striking `(relating to aid to families with dependent children)';
                (7) in section 6402 (26 U.S.C. 6402)--
                    (A) in subsection (a), by striking `(c) and (d)' and
                  inserting `(c), (d), and (e)';
                    (B) by redesignating subsections (e) through (i) as
                  subsections (f) through (j), respectively; and
                    (C) by inserting after subsection (d) the following:
            `(e) COLLECTION OF OVERPAYMENTS UNDER TITLE IV-A OF THE SOCIAL
          SECURITY ACT- The amount of any overpayment to be refunded to the
          person making the overpayment shall be reduced (after reductions
          pursuant to subsections (c) and (d), but before a credit against
          future liability for an internal revenue tax) in accordance with
          section 405(e) of the Social Security Act (concerning recovery of
          overpayments to individuals under State plans approved under part A
          of title IV of such Act).'; and
                (8) in section 7523(b)(3)(C) (26 U.S.C. 7523(b)(3)(C)), by
              striking `aid to families with dependent children' and 
              inserting `assistance under a State program funded under part A
              of title IV of the Social Security Act'.
            (m) Section 3(b) of the Wagner-Peyser Act (29 U.S.C. 49b(b)) is
          amended by striking `State plan approved under part A of title IV'
          and inserting `State program funded under part A of title IV'.
            (n) The Job Training Partnership Act (29 U.S.C. 1501 et seq.) is
          amended--
                (1) in section 4(29)(A)(i) (29 U.S.C. 1503(29)(A)(i)), by
              striking `(42 U.S.C. 601 et seq.)';
                (2) in section 106(b)(6)(C) (29 U.S.C. 1516(b)(6)(C)), by
              striking `State aid to families with dependent children
              records,' and inserting `records collected under the State
              program funded under part A of title IV of the Social Security
              Act,';
                (3) in section 121(b)(2) (29 U.S.C. 1531(b)(2))--
                    (A) by striking `the JOBS program' and inserting `the 
                  work activities required under title IV of the Social
                  Security Act'; and
                    (B) by striking the second sentence;
                (4) in section 123(c) (29 U.S.C. 1533(c))--
                    (A) in paragraph (1)(E), by repealing clause (vi); and
                    (B) in paragraph (2)(D), by repealing clause (v);
                (5) in section 203(b)(3) (29 U.S.C. 1603(b)(3)), by striking
              `, including recipients under the JOBS program';
                (6) in subparagraphs (A) and (B) of section 204(a)(1) (29
              U.S.C. 1604(a)(1) (A) and (B)), by striking `(such as the JOBS
              program)' each place it appears;
                (7) in section 205(a) (29 U.S.C. 1605(a)), by striking
              paragraph (4) and inserting the following:
                `(4) the portions of title IV of the Social Security Act
              relating to work activities;';
                (8) in section 253 (29 U.S.C. 1632)--
                    (A) in subsection (b)(2), by repealing subparagraph (C);
                  and
                    (B) in paragraphs (1)(B) and (2)(B) of subsection (c), by
                  striking `the JOBS program or' each place it appears;
                (9) in section 264 (29 U.S.C. 1644)--
                    (A) in subparagraphs (A) and (B) of subsection (b)(1), by
                  striking `(such as the JOBS program)' each place it 
                  appears; and
                    (B) in subparagraphs (A) and (B) of subsection (d)(3), by
                  striking `and the JOBS program' each place it appears;
                (10) in section 265(b) (29 U.S.C. 1645(b)), by striking
              paragraph (6) and inserting the following:
                `(6) the portion of title IV of the Social Security Act
              relating to work activities;';
                (11) in the second sentence of section 429(e) (29 U.S.C.
              1699(e)), by striking `and shall be in an amount that does not
              exceed the maximum amount that may be provided by the State
              pursuant to section 402(g)(1)(C) of the Social Security Act (42
              U.S.C. 602(g)(1)(C))';
                (12) in section 454(c) (29 U.S.C. 1734(c)), by striking `JOBS
              and';
                (13) in section 455(b) (29 U.S.C. 1735(b)), by striking `the
              JOBS program,';
                (14) in section 501(1) (29 U.S.C. 1791(1)), by striking `aid
              to families with dependent children under part A of title IV of
              the Social Security Act (42 U.S.C. 601 et seq.)' and inserting
              `assistance under the State program funded under part A of 
              title IV of the Social Security Act';
                (15) in section 506(1)(A) (29 U.S.C. 1791e(1)(A)), by 
              striking `aid to families with dependent children' and 
              inserting `assistance under the State program funded';
                (16) in section 508(a)(2)(A) (29 U.S.C. 1791g(a)(2)(A)), by
              striking `aid to families with dependent children' and 
              inserting `assistance under the State program funded'; and
                (17) in section 701(b)(2)(A) (29 U.S.C. 1792(b)(2)(A))--
                    (A) in clause (v), by striking the semicolon and 
                  inserting `; and'; and
                    (B) by striking clause (vi).
            (o) Section 3803(c)(2)(C)(iv) of title 31, United States Code, is
          amended to read as follows:
                `(iv) assistance under a State program funded under part A of
              title IV of the Social Security Act;'.
            (p) Section 2605(b)(2)(A)(i) of the Low-Income Home Energy
          Assistance Act of 1981 (42 U.S.C. 8624(b)(2)(A)(i)) is amended to
          read as follows:
                        `(i) assistance under the State program funded under
                      part A of title IV of the Social Security Act;'.
            (q) Section 303(f)(2) of the Family Support Act of 1988 (42 
          U.S.C. 602 note) is amended--
                (1) by striking `(A)'; and
                (2) by striking subparagraphs (B) and (C).
            (r) The Balanced Budget and Emergency Deficit Control Act of 1985
          (2 U.S.C. 900 et seq.) is amended--
                (1) in the first section 255(h) (2 U.S.C. 905(h)), by 
              striking `Aid to families with dependent children
              (75-0412-0-1-609);' and inserting `Block grants to States for
              temporary assistance for needy families;'; and
                (2) in section 256 (2 U.S.C. 906)--
                    (A) by striking subsection (k); and
                    (B) by redesignating subsection (l) as subsection (k).
            (s) The Immigration and Nationality Act (8 U.S.C. 1101 et seq.) 
          is amended--
                (1) in section 210(f) (8 U.S.C. 1160(f)), by striking `aid
              under a State plan approved under' each place it appears and
              inserting `assistance under a State program funded under';
                (2) in section 245A(h) (8 U.S.C. 1255a(h))--
                    (A) in paragraph (1)(A)(i), by striking `program of aid 
                  to families with dependent children' and inserting `State
                  program of assistance'; and
                    (B) in paragraph (2)(B), by striking `aid to families 
                  with dependent children' and inserting `assistance under a
                  State program funded under part A of title IV of the Social
                  Security Act'; and
                (3) in section 412(e)(4) (8 U.S.C. 1522(e)(4)), by striking
              `State plan approved' and inserting `State program funded'.
            (t) Section 640(a)(4)(B)(i) of the Head Start Act (42 U.S.C.
          9835(a)(4)(B)(i)) is amended by striking `program of aid to 
          families with dependent children under a State plan approved' and
          inserting `State program of assistance funded'.
            (u) Section 9 of the Act of April 19, 1950 (64 Stat. 47, chapter
          92; 25 U.S.C. 639) is repealed.
            (v) Subparagraph (E) of section 213(d)(6) of the School-To-Work
          Opportunities Act of 1994 (20 U.S.C. 6143(d)(6)) is amended to read
          as follows:
                    `(E) part A of title IV of the Social Security Act (42
                  U.S.C. 601 et seq.) relating to work activities;'.
            (w) Section 552a(a)(8)(B)(iv)(III) of title 5, United States 
          Code, is amended by striking `section 464 or 1137 of the Social
          Security Act' and inserting `section 404(e), 464, or 1137 of the
          Social Security Act'.
          SEC. 111. DEVELOPMENT OF PROTOTYPE OF COUNTERFEIT-RESISTANT SOCIAL
                            SECURITY CARD REQUIRED.
            (a) DEVELOPMENT- 
                (1) IN GENERAL- The Commissioner of Social Security (in this
              section referred to as the `Commissioner') shall, in accordance
              with this section, develop a prototype of a
              counterfeit-resistant social security card. Such prototype card
              shall--
                    (A) be made of a durable, tamper-resistant material such
                  as plastic or polyester,
                    (B) employ technologies that provide security features,
                  such as magnetic stripes, holograms, and integrated
                  circuits, and
                    (C) be developed so as to provide individuals with
                  reliable proof of citizenship or legal resident alien status.
                (2) ASSISTANCE BY ATTORNEY GENERAL- The Attorney General of
              the United States shall provide such information and assistance
              as the Commissioner deems necessary to enable the Commissioner
              to comply with this section.
            (b) STUDY AND REPORT- 
                (1) IN GENERAL- The Commissioner shall conduct a study and
              issue a report to Congress which examines different methods of
              improving the social security card application process.
                (2) ELEMENTS OF STUDY- The study shall include an evaluation
              of the cost and work load implications of issuing a
              counterfeit-resistant social security card for all individuals
              over a 3-, 5-, and 10-year period. The study shall also 
              evaluate the feasibility and cost implications of imposing a
              user fee for replacement cards and cards issued to individuals
              who apply for such a card prior to the scheduled 3-, 5-, and
              10-year phase-in options.
                (3) DISTRIBUTION OF REPORT- The Commissioner shall submit
              copies of the report described in this subsection along with a
              facsimile of the prototype card as described in subsection (a)
              to the Committees on Ways and Means and Judiciary of the House
              of Representatives and the Committees on Finance and Judiciary
              of the Senate within 1 year after the date of the enactment of
              this Act.
          SEC. 112. MODIFICATIONS TO THE JOB OPPORTUNITIES FOR CERTAIN
                            LOW-INCOME INDIVIDUALS PROGRAM.
            Section 505 of the Family Support Act of 1988 (42 U.S.C. 1315
          note) is amended--
                (1) in the heading, by striking `demonstration';
                (2) by striking `demonstration' each place such term appears;
                (3) in subsection (a), by striking `in each of fiscal years'
              and all that follows through `10' and inserting `shall enter
              into agreements with';
                (4) in subsection (b)(3), by striking `aid to families with
              dependent children under part A of title IV of the Social
              Security Act' and inserting `assistance under the program 
              funded part A of title IV of the Social Security Act of the
              State in which the individual resides';
                (5) in subsection (c)--
                    (A) in paragraph (1)(C), by striking `aid to families 
                  with dependent children under title IV of the Social
                  Security Act' and inserting `assistance under a State
                  program funded part A of title IV of the Social Security
                  Act';
                    (B) in paragraph (2), by striking `aid to families with
                  dependent children under title IV of such Act' and 
                  inserting `assistance under a State program funded part A 
                  of title IV of the Social Security Act';
                (6) in subsection (d), by striking `job opportunities and
              basic skills training program (as provided for under title IV 
              of the Social Security Act)' and inserting `the State program
              funded under part A of title IV of the Social Security Act'; and
                (7) by striking subsections (e) through (g) and inserting the
              following:
            `(e) AUTHORIZATION OF APPROPRIATIONS- For the purpose of
          conducting projects under this section, there is authorized to be
          appropriated an amount not to exceed $25,000,000 for any fiscal
          year.'.
          SEC. 113. SECRETARIAL SUBMISSION OF LEGISLATIVE PROPOSAL FOR
                            TECHNICAL AND CONFORMING AMENDMENTS.
            Not later than 90 days after the date of the enactment of this
          Act, the Secretary of Health and Human Services and the 
          Commissioner of Social Security, in consultation, as appropriate,
          with the heads of other Federal agencies, shall submit to the
          appropriate committees of Congress a legislative proposal proposing
          such technical and conforming amendments as are necessary to bring
          the law into conformity with the policy embodied in this title.
          SEC. 114. ASSURING MEDICAID COVERAGE FOR LOW-INCOME FAMILIES.
            (a) IN GENERAL- Title XIX is amended--
                (1) by redesignating section 1931 as section 1932; and
                (2) by inserting after section 1930 the following new section:
                   `ASSURING COVERAGE FOR CERTAIN LOW-INCOME FAMILIES
            `SEC. 1931. (a) REFERENCES TO TITLE IV-A ARE REFERENCES TO
          PRE-WELFARE-REFORM PROVISIONS- Subject to the succeeding provisions
          of this section, with respect to a State any reference in this 
          title (or any other provision of law in relation to the operation 
          of this title) to a provision of part A of title IV, or a State 
          plan under such part (or a provision of such a plan), including
          income and resource standards and income and resource methodologies
          under such part or plan, shall be considered a reference to such a
          provision or plan as in effect as of July 16, 1996, with respect to
          the State.
            `(b) APPLICATION OF PRE-WELFARE-REFORM ELIGIBILITY CRITERIA- 
                `(1) IN GENERAL- For purposes of this title, subject to
              paragraphs (2) and (3), in determining eligibility for medical
              assistance--
                    `(A) an individual shall be treated as receiving aid or
                  assistance under a State plan approved under part A of 
                  title IV only if the individual meets--
                        `(i) the income and resource standards for 
                      determining eligibility under such plan, and
                        `(ii) the eligibility requirements of such plan under
                      subsections (a) through (c) of section 406 and section
                      407(a),
                  as in effect as of July 16, 1996; and
                    `(B) the income and resource methodologies under such 
                  plan as of such date shall be used in the determination of
                  whether any individual meets income and resource standards
                  under such plan.
                `(2) STATE OPTION- For purposes of applying this section, a
              State--
                    `(A) may lower its income standards applicable with
                  respect to part A of title IV, but not below the income
                  standards applicable under its State plan under such part 
                  on May 1, 1988;
                    `(B) may increase income or resource standards under the
                  State plan referred to in paragraph (1) over a period
                  (beginning after July 16, 1996) by a percentage that does
                  not exceed the percentage increase in the Consumer Price
                  Index for all urban consumers (all items; United States 
                  city average) over such period; and
                    `(C) may use income and resource methodologies that are
                  less restrictive than the methodologies used under the 
                  State plan under such part as of July 16, 1996.
                `(3) OPTION TO TERMINATE MEDICAL ASSISTANCE FOR FAILURE TO
              MEET WORK REQUIREMENT-
                    `(A) INDIVIDUALS RECEIVING CASH ASSISTANCE UNDER TANF- In
                  the case of an individual who--
                        `(i) is receiving cash assistance under a State
                      program funded under part A of title IV,
                        `(ii) is eligible for medical assistance under this
                      title on a basis not related to section 1902(l), and
                        `(iii) has the cash assistance under such program
                      terminated pursuant to section 407(e)(1)(B) (as in
                      effect on or after the welfare reform effective date)
                      because of refusing to work,
                  the State may terminate such individual's eligibility for
                  medical assistance under this title until such time as 
                  there no longer is a basis for the termination of such cash
                  assistance because of such refusal.
                    `(B) EXCEPTION FOR CHILDREN- Subparagraph (A) shall not 
                  be construed as permitting a State to terminate medical
                  assistance for a minor child who is not the head of a
                  household receiving assistance under a State program funded
                  under part A of title IV.
            `(c) TREATMENT FOR PURPOSES OF TRANSITIONAL COVERAGE PROVISIONS- 
                `(1) TRANSITION IN THE CASE OF CHILD SUPPORT COLLECTIONS- The
              provisions of section 406(h) (as in effect on July 16, 1996)
              shall apply, in relation to this title, with respect to
              individuals (and families composed of individuals) who are
              described in subsection (b)(1)(A), in the same manner as they
              applied before such date with respect to individuals who became
              ineligible for aid to families with dependent children as a
              result (wholly or partly) of the collection of child or spousal
              support under part D of title IV.
                `(2) TRANSITION IN THE CASE OF EARNINGS FROM EMPLOYMENT- For
              continued medical assistance in the case of individuals (and
              families composed of individuals) described in subsection
              (b)(1)(A) who would otherwise become ineligible because of 
              hours or income from employment, see sections 1925 and
              1902(e)(1).
            `(d) WAIVERS- In the case of a waiver of a provision of part A of
          title IV in effect with respect to a State as of July 16, 1996, or
          which is submitted to the Secretary before the date of the 
          enactment of the Personal Responsibility and Work Opportunity
          Reconciliation Act of 1996 and approved by the Secretary on or
          before July 1, 1997, if the waiver affects eligibility of
          individuals for medical assistance under this title, such waiver 
          may (but need not) continue to be applied, at the option of the
          State, in relation to this title after the date the waiver would
          otherwise expire.
            `(e) STATE OPTION TO USE 1 APPLICATION FORM- Nothing in this
          section, or part A of title IV, shall be construed as preventing a
          State from providing for the same application form for assistance
          under a State program funded under part A of title IV (on or after
          the welfare reform effective date) and for medical assistance under
          this title.
            `(f) ADDITIONAL RULES OF CONSTRUCTION- 
                `(1) With respect to the reference in section 1902(a)(5) to a
              State plan approved under part A of title IV, a State may treat
              such reference as a reference either to a State program funded
              under such part (as in effect on and after the welfare reform
              effective date) or to the State plan under this title.
                `(2) Any reference in section 1902(a)(55) to a State plan
              approved under part A of title IV shall be deemed a reference 
              to a State program funded under such part.
                `(3) In applying section 1903(f), the applicable income
              limitation otherwise determined shall be subject to increase in
              the same manner as income or resource standards of a State may
              be increased under subsection (b)(2)(B).
            `(g) RELATION TO OTHER PROVISIONS- The provisions of this section
          shall apply notwithstanding any other provision of this Act.
            `(h) TRANSITIONAL INCREASED FEDERAL MATCHING RATE FOR INCREASED
          ADMINISTRATIVE COSTS-
                `(1) IN GENERAL- Subject to the succeeding provisions of this
              subsection, the Secretary shall provide that with respect to
              administrative expenditures described in paragraph (2) the per
              centum specified in section 1903(a)(7) shall be increased to
              such percentage as the Secretary specifies.
                `(2) ADMINISTRATIVE EXPENDITURES DESCRIBED- The 
              administrative expenditures described in this paragraph are
              expenditures described in section 1903(a)(7) that a State
              demonstrates to the satisfaction of the Secretary are
              attributable to administrative costs of eligibility
              determinations that (but for the enactment of this section)
              would not be incurred.
                `(3) LIMITATION- The total amount of additional Federal funds
              that are expended as a result of the application of this
              subsection for the period beginning with fiscal year 1997 and
              ending with fiscal year 2000 shall not exceed $500,000,000. In
              applying this paragraph, the Secretary shall ensure the
              equitable distribution of additional funds among the States.
                `(4) TIME LIMITATION- This subsection shall only apply with
              respect to a State for expenditures incurred during the first 
              12 calendar quarters in which the State program funded under
              part A of title IV (as in effect on and after the welfare 
              reform effective date) is in effect.
            `(i) WELFARE REFORM EFFECTIVE DATE- In this section, the term
          `welfare reform effective date' means the effective date, with
          respect to a State, of title I of the Personal Responsibility and
          Work Opportunity Reconciliation Act of 1996 (as specified in 
          section 116 of such Act).'.
            (b) PLAN AMENDMENT- Section 1902(a) (42 U.S.C. 1396a(a)) is
          amended--
                (1) by striking `and' at the end of paragraph (61),
                (2) by striking the period at the end of paragraph (62) and
              inserting `; and', and
                (3) by inserting after paragraph (62) the following new
              paragraph:
                `(63) provide for administration and determinations of
              eligibility with respect to individuals who are (or seek to be)
              eligible for medical assistance based on the application of
              section 1931.'.
            (c) EXTENSION OF WORK TRANSITION PROVISIONS- Sections
          1902(e)(1)(B) and 1925(f) (42 U.S.C. 1396a(e)(1)(B), 1396r-6(f)) 
          are each amended by striking `1998' and inserting `2001'.
            (d) ELIMINATION OF REQUIREMENT OF MINIMUM AFDC PAYMENT LEVELS- 
          (1) Section 1902(c) (42 U.S.C. 1396a(c)) is amended by striking
          `if--' and all that follows and inserting the following: `if the
          State requires individuals described in subsection (l)(1) to apply
          for assistance under the State program funded under part A of title
          IV as a condition of applying for or receiving medical assistance
          under this title.'.
            (2) Section 1903(i) (42 U.S.C. 1396b(i)) is amended by striking
          paragraph (9).
          SEC. 115. DENIAL OF ASSISTANCE AND BENEFITS FOR CERTAIN 
                            DRUG-RELATED CONVICTIONS.
            (a) IN GENERAL- An individual convicted (under Federal or State
          law) of any offense which is classified as a felony by the law of
          the jurisdiction involved and which has as an element the
          possession, use, or distribution of a controlled substance (as
          defined in section 102(6) of the Controlled Substances Act (21
          U.S.C. 802(6))) shall not be eligible for--
                (1) assistance under any State program funded under part A of
              title IV of the Social Security Act, or
                (2) benefits under the food stamp program (as defined in
              section 3(h) of the Food Stamp Act of 1977) or any State 
              program carried out under the Food Stamp Act of 1977.
            (b) EFFECTS ON ASSISTANCE AND BENEFITS FOR OTHERS- 
                (1) PROGRAM OF TEMPORARY ASSISTANCE FOR NEEDY FAMILIES- The
              amount of assistance otherwise required to be provided under a
              State program funded under part A of title IV of the Social
              Security Act to the family members of an individual to whom
              subsection (a) applies shall be reduced by the amount which
              would have otherwise been made available to the individual 
              under such part.
                (2) BENEFITS UNDER THE FOOD STAMP ACT OF 1977- The amount of
              benefits otherwise required to be provided to a household under
              the food stamp program (as defined in section 3(h) of the Food
              Stamp Act of 1977), or any State program carried out under the
              Food Stamp Act of 1977, shall be determined by considering the
              individual to whom subsection (a) applies not to be a member of
              such household, except that the income and resources of the
              individual shall be considered to be income and resources of 
              the household.
            (c) ENFORCEMENT- A State that has not exercised its authority
          under subsection (d)(1)(A) shall require each individual applying
          for assistance or benefits referred to in subsection (a), during 
          the application process, to state, in writing, whether the
          individual, or any member of the household of the individual, has
          been convicted of a crime described in subsection (a).
            (d) LIMITATIONS- 
                (1) STATE ELECTIONS- 
                    (A) OPT OUT- A State may, by specific reference in a law
                  enacted after the date of the enactment of this Act, exempt
                  any or all individuals domiciled in the State from the
                  application of subsection (a).
                    (B) LIMIT PERIOD OF PROHIBITION- A State may, by law
                  enacted after the date of the enactment of this Act, limit
                  the period for which subsection (a) shall apply to any or
                  all individuals domiciled in the State.
                (2) INAPPLICABILITY TO CONVICTIONS OCCURRING ON OR BEFORE
              ENACTMENT- Subsection (a) shall not apply to convictions
              occurring on or before the date of the enactment of this Act.
            (e) DEFINITIONS OF STATE- For purposes of this section, the term
          `State' has the meaning given it--
                (1) in section 419(5) of the Social Security Act, when
              referring to assistance provided under a State program funded
              under part A of title IV of the Social Security Act, and
                (2) in section 3(m) of the Food Stamp Act of 1977, when
              referring to the food stamp program (as defined in section 3(h)
              of the Food Stamp Act of 1977) or any State program carried out
              under the Food Stamp Act of 1977.
            (f) RULE OF INTERPRETATION- Nothing in this section shall be
          construed to deny the following Federal benefits:
                (1) Emergency medical services under title XIX of the Social
              Security Act.
                (2) Short-term, noncash, in-kind emergency disaster relief.
                (3)(A) Public health assistance for immunizations.
                (B) Public health assistance for testing and treatment of
              communicable diseases if the Secretary of Health and Human
              Services determines that it is necessary to prevent the spread
              of such disease.
                (4) Prenatal care.
                (5) Job training programs.
                (6) Drug treatment programs.
          SEC. 116. EFFECTIVE DATE; TRANSITION RULE.
            (a) EFFECTIVE DATES- 
                (1) IN GENERAL- Except as otherwise provided in this title,
              this title and the amendments made by this title shall take
              effect on July 1, 1997.
                (2) DELAYED EFFECTIVE DATE FOR CERTAIN PROVISIONS-
              Notwithstanding any other provision of this section, paragraphs
              (2), (3), (4), (5), (8), and (10) of section 409(a) and section
              411(a) of the Social Security Act (as added by the amendments
              made by section 103(a) of this Act) shall not take effect with
              respect to a State until, and shall apply only with respect to
              conduct that occurs on or after, the later of--
                    (A) July 1, 1997; or
                    (B) the date that is 6 months after the date the 
                  Secretary of Health and Human Services receives from the
                  State a plan described in section 402(a) of the Social
                  Security Act (as added by such amendment).
                (3) GRANTS TO OUTLYING AREAS- The amendments made by section
              103(b) shall take effect on October 1, 1996.
                (4) ELIMINATION OF CHILD CARE PROGRAMS- The amendments made 
              by section 103(c) shall take effect on October 1, 1996.
                (5) DEFINITIONS APPLICABLE TO NEW CHILD CARE ENTITLEMENT-
              Sections 403(a)(1)(C), 403(a)(1)(D), and 419(4) of the Social
              Security Act, as added by the amendments made by section 103(a)
              of this Act, shall take effect on October 1, 1996.
            (b) TRANSITION RULES- Effective on the date of the enactment of
          this Act:
                (1) STATE OPTION TO ACCELERATE EFFECTIVE DATE- 
                    (A) IN GENERAL- If the Secretary of Health and Human
                  Services receives from a State a plan described in section
                  402(a) of the Social Security Act (as added by the 
                  amendment made by section 103(a)(1) of this Act), then--
                        (i) on and after the date of such receipt--
            (I) except as provided in clause (ii), this title and the
          amendments made by this title (other than by section 103(c) of this
          Act) shall apply with respect to the State; and
            (II) the State shall be considered an eligible State for purposes
          of part A of title IV of the Social Security Act (as in effect
          pursuant to the amendments made by such section 103(a)); and
                        (ii) during the period that begins on the date of 
                      such receipt and ends on June 30, 1997, there shall
                      remain in effect with respect to the State--
            (I) section 403(h) of the Social Security Act (as in effect on
          September 30, 1995); and
            (II) all State reporting requirements under parts A and F of 
          title IV of the Social Security Act (as in effect on September 30,
          1995), modified by the Secretary as appropriate, taking into 
          account the State program under part A of title IV of the Social
          Security Act (as in effect pursuant to the amendments made by such
          section 103(a)).
                    (B) LIMITATIONS ON FEDERAL OBLIGATIONS- 
                        (i) UNDER AFDC PROGRAM- The total obligations of the
                      Federal Government to a State under part A of title IV
                      of the Social Security Act (as in effect on September
                      30, 1995) with respect to expenditures in fiscal year
                      1997 shall not exceed an amount equal to the State
                      family assistance grant.
                        (ii) UNDER TEMPORARY FAMILY ASSISTANCE PROGRAM-
                      Notwithstanding section 403(a)(1) of the Social 
                      Security Act (as in effect pursuant to the amendments
                      made by section 103(a) of this Act), the total
                      obligations of the Federal Government to a State under
                      such section 403(a)(1)--
            (I) for fiscal year 1996, shall be an amount equal to--
            (aa) the State family assistance grant; multiplied by
            (bb)  1/366  of the number of days during the period that begins
          on the  date the Secretary of Health and Human Services first
          receives from the State a plan described in section 402(a) of the
          Social Security Act (as added by the amendment made by section
          103(a)(1) of this Act) and ends on September 30, 1996; and
            (II) for fiscal year 1997, shall be an amount equal to the lesser
          of--
            (aa) the amount (if any) by which the State family assistance
          grant exceeds the total obligations of the Federal Government to 
          the State under part A of title IV of the Social Security Act (as 
          in effect on September 30, 1995) with respect to expenditures in
          fiscal year 1997; or
            (bb) the State family assistance grant, multiplied by  1/365  of
          the number of days during the period that begins on October 1, 
          1996, or the date the Secretary of Health and Human Services first
          receives from the State a plan described in section 402(a) of the
          Social Security Act (as added by the amendment made by section
          103(a)(1) of this Act), whichever is later, and ends on September
          30, 1997.
                        (iii) CHILD CARE OBLIGATIONS EXCLUDED IN DETERMINING
                      FEDERAL AFDC OBLIGATIONS- As used in this subparagraph,
                      the term `obligations of the Federal Government to the
                      State under part A of title IV of the Social Security
                      Act' does not include any obligation of the Federal
                      Government with respect to child care expenditures by
                      the State.
                    (C) SUBMISSION OF STATE PLAN FOR FISCAL YEAR 1996 OR 1997
                  DEEMED ACCEPTANCE OF GRANT LIMITATIONS AND FORMULA AND
                  TERMINATION OF AFDC ENTITLEMENT- The submission of a plan 
                  by a State pursuant to subparagraph (A) is deemed to
                  constitute--
                        (i) the State's acceptance of the grant reductions
                      under subparagraph (B) (including the formula for
                      computing the amount of the reduction); and
                        (ii) the termination of any entitlement of any
                      individual or family to benefits or services under the
                      State AFDC program.
                    (D) DEFINITIONS- As used in this paragraph:
                        (i) STATE AFDC PROGRAM- The term `State AFDC program'
                      means the State program under parts A and F of title IV
                      of the Social Security Act (as in effect on September
                      30, 1995).
                        (ii) STATE- The term `State' means the 50 States and
                      the District of Columbia.
                        (iii) STATE FAMILY ASSISTANCE GRANT- The term `State
                      family assistance grant' means the State family
                      assistance grant (as defined in section 403(a)(1)(B) of
                      the Social Security Act, as added by the amendment made
                      by section 103(a)(1) of this Act).
                (2) CLAIMS, ACTIONS, AND PROCEEDINGS- The amendments made by
              this title shall not apply with respect to--
                    (A) powers, duties, functions, rights, claims, penalties,
                  or obligations applicable to aid, assistance, or services
                  provided before the effective date of this title under the
                  provisions amended; and
                    (B) administrative actions and proceedings commenced
                  before such date, or authorized before such date to be
                  commenced, under such provisions.
                (3) CLOSING OUT ACCOUNT FOR THOSE PROGRAMS TERMINATED OR
              SUBSTANTIALLY MODIFIED BY THIS TITLE- In closing out accounts,
              Federal and State officials may use scientifically acceptable
              statistical sampling techniques. Claims made with respect to
              State expenditures under a State plan approved under part A of
              title IV of the Social Security Act (as in effect on September
              30, 1995) with respect to assistance or services provided on or
              before September 30, 1995, shall be treated as claims with
              respect to expenditures during fiscal year 1995 for purposes of
              reimbursement even if payment was made by a State on or after
              October 1, 1995. Each State shall complete the filing of all
              claims under the State plan (as so in effect) within 2 years
              after the date of the enactment of this Act. The head of each
              Federal department shall--
                    (A) use the single audit procedure to review and resolve
                  any claims in connection with the close out of programs
                  under such State plans; and
                    (B) reimburse States for any payments made for assistance
                  or services provided during a prior fiscal year from funds
                  for fiscal year 1995, rather than from funds authorized by
                  this title.
                (4) CONTINUANCE IN OFFICE OF ASSISTANT SECRETARY FOR FAMILY
              SUPPORT- The individual who, on the day before the effective
              date of this title, is serving as Assistant Secretary for 
              Family Support within the Department of Health and Human
              Services shall, until a successor is appointed to such position--
                    (A) continue to serve in such position; and
                    (B) except as otherwise provided by law--
                        (i) continue to perform the functions of the 
                      Assistant Secretary for Family Support under section 
                      417 of the Social Security Act (as in effect before 
                      such effective date); and
                        (ii) have the powers and duties of the Assistant
                      Secretary for Family Support under section 416 of the
                      Social Security Act (as in effect pursuant to the
                      amendment made by section 103(a)(1) of this Act).
            (c) TERMINATION OF ENTITLEMENT UNDER AFDC PROGRAM- Effective
          October 1, 1996, no individual or family shall be entitled to any
          benefits or services under any State plan approved under part A or 
          F of title IV of the Social Security Act (as in effect on September
          30, 1995).
                         TITLE II--SUPPLEMENTAL SECURITY INCOME
          SEC. 200. REFERENCE TO SOCIAL SECURITY ACT.
            Except as otherwise specifically provided, wherever in this title
          an amendment is expressed in terms of an amendment to or repeal of 
          a section or other provision, the reference shall be considered to
          be made to that section or other provision of the Social Security
          Act.
                          SUBTITLE A--ELIGIBILITY RESTRICTIONS
          SEC. 201. DENIAL OF SSI BENEFITS FOR 10 YEARS TO INDIVIDUALS FOUND
                            TO HAVE FRAUDULENTLY MISREPRESENTED RESIDENCE IN
                            ORDER TO OBTAIN BENEFITS SIMULTANEOUSLY IN 2 OR
                            MORE STATES.
            (a) IN GENERAL- Section 1611(e) (42 U.S.C. 1382(e)), as amended 
          by section 105(b)(4)(A) of the Contract with America Advancement 
          Act of 1996, is amended by redesignating paragraph (5) as paragraph
          (3) and by adding at the end the following new paragraph:
            `(4)(A) No person shall be considered an eligible individual or
          eligible spouse for purposes of this title during the 10-year 
          period that begins on the date the person is convicted in Federal 
          or State court of having made a fraudulent statement or
          representation with respect to the place of residence of the person
          in order to receive assistance simultaneously from 2 or more States
          under programs that are funded under title IV, title XIX, or the
          Food Stamp Act of 1977, or benefits in 2 or more States under the
          supplemental security income program under this title.
            `(B) As soon as practicable after the conviction of a person in a
          Federal or State court as described in subparagraph (A), an 
          official of such court shall notify the Commissioner of such
          conviction.'.
            (b) EFFECTIVE DATE- The amendment made by this section shall take
          effect on the date of the enactment of this Act.
          SEC. 202. DENIAL OF SSI BENEFITS FOR FUGITIVE FELONS AND PROBATION
                            AND PAROLE VIOLATORS.
            (a) IN GENERAL- Section 1611(e) (42 U.S.C. 1382(e)), as amended 
          by section 201(a) of this Act, is amended by adding at the end the
          following new paragraph:
            `(5) No person shall be considered an eligible individual or
          eligible spouse for purposes of this title with respect to any 
          month if during such month the person is--
                `(A) fleeing to avoid prosecution, or custody or confinement
              after conviction, under the laws of the place from which the
              person flees, for a crime, or an attempt to commit a crime,
              which is a felony under the laws of the place from which the
              person flees, or which, in the case of the State of New Jersey,
              is a high misdemeanor under the laws of such State; or
                `(B) violating a condition of probation or parole imposed
              under Federal or State law.'.
            (b) EXCHANGE OF INFORMATION- Section 1611(e) (42 U.S.C. 1382(e)),
          as amended by section 201(a) of this Act and subsection (a) of this
          section, is amended by adding at the end the following new paragraph:
            `(6) Notwithstanding any other provision of law (other than
          section 6103 of the Internal Revenue Code of 1986), the 
          Commissioner shall furnish any Federal, State, or local law
          enforcement officer, upon the written request of the officer, with
          the current address, Social Security number, and photograph (if
          applicable) of any recipient of benefits under this title, if the
          officer furnishes the Commissioner with the name of the recipient,
          and other identifying information as reasonably required by the
          Commissioner to establish the unique identity of the recipient, and
          notifies the Commissioner that--
                `(A) the recipient--
                    `(i) is described in subparagraph (A) or (B) of paragraph
                  (5); and
                    `(ii) has information that is necessary for the officer 
                  to conduct the officer's official duties; and
                `(B) the location or apprehension of the recipient is within
              the officer's official duties.'.
            (c) EFFECTIVE DATE- The amendments made by this section shall 
          take effect on the date of the enactment of this Act.
          SEC. 203. TREATMENT OF PRISONERS.
            (a) IMPLEMENTATION OF PROHIBITION AGAINST PAYMENT OF BENEFITS TO
          PRISONERS-
                (1) IN GENERAL- Section 1611(e)(1) (42 U.S.C. 1382(e)(1)) is
              amended by adding at the end the following new subparagraph:
            `(I)(i) The Commissioner shall enter into an agreement, with any
          interested State or local institution described in clause (i) or
          (ii) of section 202(x)(1)(A) the primary purpose of which is to
          confine individuals as described in section 202(x)(1)(A), under
          which--
                `(I) the institution shall provide to the Commissioner, on a
              monthly basis and in a manner specified by the Commissioner, 
              the names, social security account numbers, dates of birth,
              confinement commencement dates, and, to the extent available to
              the institution, such other identifying information concerning
              the inmates of the institution as the Commissioner may require
              for the purpose of carrying out paragraph (1); and
                `(II) the Commissioner shall pay to any such institution, 
              with respect to each inmate of the institution who is eligible
              for a benefit under this title for the month preceding the 
              first month throughout which such inmate is in such institution
              and becomes ineligible for such benefit as a result of the
              application of this subparagraph, $400 if the institution
              furnishes the information described in subclause (I) to the
              Commissioner within 30 days after the date such individual
              becomes an inmate of such institution, or $200 if the
              institution furnishes such information after 30 days after such
              date but within 90 days after such date.
            `(ii)(I) The provisions of section 552a of title 5, United States
          Code, shall not apply to any agreement entered into under clause 
          (i) or to information exchanged pursuant to such agreement.
            `(II) The Commissioner is authorized to provide, on a 
          reimbursable basis, information obtained pursuant to agreements
          entered into under clause (i) to any Federal or federally-assisted
          cash, food, or medical assistance program for eligibility purposes.
            `(iii) Payments to institutions required by clause (i)(II) shall
          be made from funds otherwise available for the payment of benefits
          under this title and shall be treated as direct spending for
          purposes of the Balanced Budget and Emergency Deficit Control Act 
          of 1985.'.
                (2) EFFECTIVE DATE- The amendment made by this subsection
              shall apply to individuals whose period of confinement in an
              institution commences on or after the first day of the seventh
              month beginning after the month in which this Act is enacted.
            (b) STUDY OF OTHER POTENTIAL IMPROVEMENTS IN THE COLLECTION OF
          INFORMATION RESPECTING PUBLIC INMATES-
                (1) STUDY- The Commissioner of Social Security shall conduct 
              a study of the desirability, feasibility, and cost of--
                    (A) establishing a system under which Federal, State, and
                  local courts would furnish to the Commissioner such
                  information respecting court orders by which individuals 
                  are confined in jails, prisons, or other public penal,
                  correctional, or medical facilities as the Commissioner may
                  require for the purpose of carrying out section 1611(e)(1)
                  of the Social Security Act; and
                    (B) requiring that State and local jails, prisons, and
                  other institutions that enter into agreements with the
                  Commissioner under section 1611(e)(1)(I) of the Social
                  Security Act furnish the information required by such
                  agreements to the Commissioner by means of an electronic or
                  other sophisticated data exchange system.
                (2) REPORT- Not later than 1 year after the date of the
              enactment of this Act, the Commissioner of Social Security 
              shall submit a report on the results of the study conducted
              pursuant to this subsection to the Committee on Finance of the
              Senate and the Committee on Ways and Means of the House of
              Representatives.
            (c) ADDITIONAL REPORT TO CONGRESS- Not later than October 1, 
          1998, the Commissioner of Social Security shall provide to the
          Committee on Finance of the Senate and the Committee on Ways and
          Means of the House of Representatives a list of the institutions
          that are and are not providing information to the Commissioner 
          under section 1611(e)(1)(I) of the Social Security Act (as added by
          this section).
          SEC. 204. EFFECTIVE DATE OF APPLICATION FOR BENEFITS.
            (a) IN GENERAL- Subparagraphs (A) and (B) of section 1611(c)(7)
          (42 U.S.C. 1382(c)(7)) are amended to read as follows:
                `(A) the first day of the month following the date such
              application is filed, or
                `(B) the first day of the month following the date such
              individual becomes eligible for such benefits with respect to
              such application.'.
            (b) SPECIAL RULE RELATING TO EMERGENCY ADVANCE PAYMENTS- Section
          1631(a)(4)(A) (42 U.S.C. 1383(a)(4)(A)) is amended--
                (1) by inserting `for the month following the date the
              application is filed' after `is presumptively eligible for such
              benefits'; and
                (2) by inserting `, which shall be repaid through
              proportionate reductions in such benefits over a period of not
              more than 6 months' before the semicolon.
            (c) CONFORMING AMENDMENTS- 
                (1) Section 1614(b) (42 U.S.C. 1382c(b)) is amended--
                    (A)  by striking `or requests' and inserting `, on the
                  first day of the month following the date the application 
                  is filed, or, in any case in which either spouse requests';
                  and
                    (B) by striking `application or'.
                (2) Section 1631(g)(3) (42 U.S.C. 1382j(g)(3)) is amended by
              inserting `following the month' after `beginning with the month'.
            (d) EFFECTIVE DATE- 
                (1) IN GENERAL- The amendments made by this section shall
              apply to applications for benefits under title XVI of the 
              Social Security Act filed on or after the date of the enactment
              of this Act, without regard to whether regulations have been
              issued to implement such amendments.
                (2) BENEFITS UNDER TITLE XVI- For purposes of this 
              subsection, the term `benefits under title XVI of the Social
              Security Act' includes supplementary payments pursuant to an
              agreement for Federal administration under section 1616(a) of
              the Social Security Act, and payments pursuant to an agreement
              entered into under section 212(b) of Public Law 93-66.
                       SUBTITLE B--BENEFITS FOR DISABLED CHILDREN
          SEC. 211. DEFINITION AND ELIGIBILITY RULES.
            (a) DEFINITION OF CHILDHOOD DISABILITY- Section 1614(a)(3) (42
          U.S.C. 1382c(a)(3)), as amended by section 105(b)(1) of the 
          Contract with America Advancement Act of 1996, is amended--
                (1) in subparagraph (A), by striking `An individual' and
              inserting `Except as provided in subparagraph (C), an
              indi-vidual';
                (2) in subparagraph (A), by striking `(or, in the case of an
              individual under the age of 18, if he suffers from any 
              medically determinable physical or mental impairment of
              comparable severity)';
                (3) by redesignating subparagraphs (C) through (I) as
              subparagraphs (D) through (J), respectively;
                (4) by inserting after subparagraph (B) the following new
              subparagraph:
            `(C)(i) An individual under the age of 18 shall be considered
          disabled for the purposes of this title if that individual has a
          medically determinable physical or mental impairment, which results
          in marked and severe functional limitations, and which can be
          expected to result in death or which has lasted or can be expected
          to last for a continuous period of not less than 12 months.
            `(ii) Notwithstanding clause (i), no individual under the age of
          18 who engages in substantial gainful activity (determined in
          accordance with regulations prescribed pursuant to subparagraph 
          (E)) may be considered to be disabled.'; and
                (5) in subparagraph (F), as redesignated by paragraph (3), by
              striking `(D)' and inserting `(E)'.
            (b) Changes to Childhood SSI Regulations- 
                (1) MODIFICATION TO MEDICAL CRITERIA FOR EVALUATION OF MENTAL
              AND EMOTIONAL DISORDERS- The Commissioner of Social Security
              shall modify sections 112.00C.2. and 112.02B.2.c.(2) of 
              appendix 1 to subpart P of part 404 of title 20, Code of 
              Federal Regulations, to eliminate references to maladaptive
              behavior in the domain of personal/behavorial function.
                (2) DISCONTINUANCE OF INDIVIDUALIZED FUNCTIONAL ASSESSMENT-
              The Commissioner of Social Security shall discontinue the
              individualized functional assessment for children set forth in
              sections 416.924d and 416.924e of title 20, Code of Federal
              Regulations.
            (c) MEDICAL IMPROVEMENT REVIEW STANDARD AS IT APPLIES TO
          INDIVIDUALS UNDER THE AGE OF 18- Section 1614(a)(4) (42 U.S.C.
          1382(a)(4)) is amended--
                (1) by redesignating subclauses (I) and (II) of clauses (i)
              and (ii) of subparagraph (B) as items (aa) and (bb),
              respectively;
                (2) by redesignating clauses (i) and (ii) of subparagraphs 
              (A) and (B) as subclauses (I) and (II), respectively;
                (3) by redesignating subparagraphs (A) through (C) as clauses
              (i) through (iii), respectively;
                (4) by inserting before clause (i) (as redesignated by
              paragraph (3)) the following new subparagraph:
                `(A) in the case of an individual who is age 18 or older--';
                (5) by inserting after and below subparagraph (A)(iii) (as so
              redesignated) the following new subparagraph:
                `(B) in the case of an individual who is under the age of 18--
                    `(i) substantial evidence which demonstrates that there
                  has been medical improvement in the individual's impairment
                  or combination of impairments, and that such impairment or
                  combination of impairments no longer results in marked and
                  severe functional limitations; or
                    `(ii) substantial evidence which demonstrates that, as
                  determined on the basis of new or improved diagnostic
                  techniques or evaluations, the individual's impairment or
                  combination of impairments, is not as disabling as it was
                  considered to be at the time of the most recent prior
                  decision that the individual was under a disability or
                  continued to be under a disability, and such impairment or
                  combination of impairments does not result in marked and
                  severe functional limitations; or';
                (6) by redesignating subparagraph (D) as subparagraph (C) and
              by inserting in such subparagraph `in the case of any
              individual,' before `substantial evidence'; and
                (7) in the first sentence following subparagraph (C) (as
              redesignated by paragraph (6)), by--
                    (A) inserting `(i)' before `to restore'; and
                    (B) inserting `, or (ii) in the case of an individual
                  under the age of 18, to eliminate or improve the
                  individual's impairment or combination of impairments so
                  that it no longer results in marked and severe functional
                  limitations' immediately before the period.
            (d) EFFECTIVE DATES, ETC- 
                (1) EFFECTIVE DATES- 
                    (A) SUBSECTIONS (a) AND (b)- 
                        (i) IN GENERAL- The provisions of, and amendments 
                      made by, subsections (a) and (b) of this section shall
                      apply to any individual who applies for, or whose claim
                      is finally adjudicated with respect to, benefits under
                      title XVI of the Social Security Act on or after the
                      date of the enactment of this Act, without regard to
                      whether regulations have been issued to implement such
                      provisions and amendments.
                        (ii) DETERMINATION OF FINAL ADJUDICATION- For 
                      purposes of clause (i), no individual's claim with
                      respect to such benefits may be considered to be 
                      finally adjudicated before such date of enactment if, 
                      on or after such date, there is pending a request for
                      either administrative or judicial review with respect 
                      to such claim that has been denied in whole, or there 
                      is pending, with respect to such claim, readjudication
                      by the Commissioner of Social Security pursuant to
                      relief in a class action or implementation by the
                      Commissioner of a court remand order.
                    (B) SUBSECTION (c)- The amendments made by subsection (c)
                  of this section shall apply with respect to benefits under
                  title XVI of the Social Security Act for months beginning 
                  on or after the date of the enactment of this Act, without
                  regard to whether regulations have been issued to implement
                  such amendments.
                (2) APPLICATION TO CURRENT RECIPIENTS- 
                    (A) ELIGIBILITY REDETERMINATIONS- During the period
                  beginning on the date of the enactment of this Act and
                  ending on the date which is 1 year after such date of
                  enactment, the Commissioner of Social Security shall
                  redetermine the eligibility of any individual under age 18
                  who is eligible for supplemental security income benefits 
                  by reason of disability under title XVI of the Social
                  Security Act as of the date of the enactment of this Act 
                  and whose eligibility for such benefits may terminate by
                  reason of the provisions of, or amendments made by,
                  subsections (a) and (b) of this section. With respect to 
                  any redetermination under this subparagraph--
                        (i) section 1614(a)(4) of the Social Security Act (42
                      U.S.C. 1382c(a)(4)) shall not apply;
                        (ii) the Commissioner of Social Security shall apply
                      the eligibility criteria for new applicants for 
                      benefits under title XVI of such Act;
                        (iii) the Commissioner shall give such 
                      redetermination priority over all continuing 
                      eligibility reviews and other reviews under such title;
                      and
                        (iv) such redetermination shall be counted as a 
                      review or redetermination otherwise required to be made
                      under section 208 of the Social Security Independence
                      and Program Improvements Act of 1994 or any other
                      provision of title XVI of the Social Security Act.
                    (B) GRANDFATHER PROVISION- The provisions of, and
                  amendments made by, subsections (a) and (b) of this 
                  section, and the redetermination under subparagraph (A),
                  shall only apply with respect to the benefits of an
                  individual described in subparagraph (A) for months
                  beginning on or after the later of July 1, 1997, or the 
                  date of the redetermination with respect to such individual.
                    (C) NOTICE- Not later than January 1, 1997, the
                  Commissioner of Social Security shall notify an individual
                  described in subparagraph (A) of the provisions of this
                  paragraph.
                (3) REPORT- The Commissioner of Social Security shall report
              to the Congress regarding the progress made in implementing the
              provisions of, and amendments made by, this section on child
              disability evaluations not later than 180 days after the date 
              of the enactment of this Act.
                (4) REGULATIONS- Notwithstanding any other provision of law,
              the Commissioner of Social Security shall submit for review to
              the committees of jurisdiction in the Congress any final
              regulation pertaining to the eligibility of individuals under
              age 18 for benefits under title XVI of the Social Security Act
              at least 45 days before the effective date of such regulation.
              The submission under this paragraph shall include supporting
              documentation providing a cost analysis, workload impact, and
              projections as to how the regulation will effect the future
              number of recipients under such title.
                (5) CAP ADJUSTMENT FOR SSI ADMINISTRATIVE WORK REQUIRED BY
              WELFARE REFORM-
                    (A) AUTHORIZATION- For the additional costs of continuing
                  disability reviews and redeterminations under title XVI of
                  the Social Security Act, there is hereby authorized to be
                  appropriated to the Social Security Administration, in
                  addition to amounts authorized under section 201(g)(1)(A) 
                  of the Social Security Act, $150,000,000 in fiscal year 
                  1997 and $100,000,000 in fiscal year 1998.
                    (B) CAP ADJUSTMENT- Section 251(b)(2)(H) of the Balanced
                  Budget and Emergency Deficit Control Act of 1985, as 
                  amended by section 103(b) of the Contract with America
                  Advancement Act of 1996, is amended--
                        (i) in clause (i)--
            (I) in subclause (II) by--
            (aa) striking `$25,000,000' and inserting `$175,000,000'; and
            (bb) striking `$160,000,000' and inserting `$310,000,000'; and
            (II) in subclause (III) by--
            (aa) striking `$145,000,000' and inserting `$245,000,000'; and
            (bb) striking `$370,000,000' and inserting `$470,000,000'; and
                        (ii) by amending clause (ii)(I) to read as follows:
                        `(I) the term `continuing disability reviews' means
                      reviews or redeterminations as defined under section
                      201(g)(1)(A) of the Social Security Act and reviews and
                      redeterminations authorized under section 211 of the
                      Personal Responsibility and Work Opportunity
                      Reconciliation Act of 1996;'.
                    (C) ADJUSTMENTS- Section 606(e)(1)(B) of the 
                  Congressional Budget Act of 1974 is amended by adding at 
                  the end the following new sentences: `If the adjustments
                  referred to in the preceding sentence are made for an
                  appropriations measure that is not enacted into law, then
                  the Chairman of the Committee on the Budget of the House of
                  Representatives shall, as soon as practicable, reverse 
                  those adjustments. The Chairman of the Committee on the
                  Budget of the House of Representatives shall submit any
                  adjustments made under this subparagraph to the House of
                  Representatives and have such adjustments published in the
                  Congressional Record.'.
                    (D) CONFORMING AMENDMENT- Section 103(d)(1) of the
                  Contract with America Advancement Act of 1996 (42 U.S.C. 
                  401 note) is amended by striking `medicaid programs.' and
                  inserting `medicaid programs, except that the amounts
                  appropriated pursuant to the authorization and 
                  discretionary spending allowance provisions in section
                  211(d)(2)(5) of the Personal Responsibility and Work
                  Opportunity Reconciliation Act of 1996 shall be used only
                  for continuing disability reviews and redeterminations 
                  under title XVI of the Social Security Act.'.
                (6) BENEFITS UNDER TITLE XVI- For purposes of this 
              subsection, the term `benefits under title XVI of the Social
              Security Act' includes supplementary payments pursuant to an
              agreement for Federal administration under section 1616(a) of
              the Social Security Act, and payments pursuant to an agreement
              entered into under section 212(b) of Public Law 93-66.
          SEC. 212. ELIGIBILITY REDETERMINATIONS AND CONTINUING DISABILITY
                            REVIEWS.
            (a) CONTINUING DISABILITY REVIEWS RELATING TO CERTAIN CHILDREN-
          Section 1614(a)(3)(H) (42 U.S.C. 1382c(a)(3)(H)), as redesignated 
          by section 211(a)(3) of this Act, is amended--
                (1) by inserting `(i)' after `(H)'; and
                (2) by adding at the end the following new clause:
            `(ii)(I) Not less frequently than once every 3 years, the
          Commissioner shall review in accordance with paragraph (4) the
          continued eligibility for benefits under this title of each
          individual who has not attained 18 years of age and is eligible for
          such benefits by reason of an impairment (or combination of
          impairments) which is likely to improve (or, at the option of the
          Commissioner, which is unlikely to improve).
            `(II) A representative payee of a recipient whose case is 
          reviewed under this clause shall present, at the time of review,
          evidence demonstrating that the recipient is, and has been,
          receiving treatment, to the extent considered medically necessary
          and available, of the condition which was the basis for providing
          benefits under this title.
            `(III) If the representative payee refuses to comply without good
          cause with the requirements of subclause (II), the Commissioner of
          Social Security shall, if the Commissioner determines it is in the
          best interest of the individual, promptly suspend payment of
          benefits to the representative payee, and provide for payment of
          benefits to an alternative representative payee of the individual
          or, if the interest of the individual under this title would be
          served thereby, to the individual.
            `(IV) Subclause (II) shall not apply to the representative payee
          of any individual with respect to whom the Commissioner determines
          such application would be inappropriate or unnecessary. In making
          such determination, the Commissioner shall take into consideration
          the nature of the individual's impairment (or combination of
          impairments). Section 1631(c) shall not apply to a finding by the
          Commissioner that the requirements of subclause (II) should not
          apply to an individual's representative payee.'.
            (b) DISABILITY ELIGIBILITY REDETERMINATIONS REQUIRED FOR SSI
          RECIPIENTS WHO ATTAIN 18 YEARS OF AGE-
                (1) IN GENERAL- Section 1614(a)(3)(H) (42 U.S.C.
              1382c(a)(3)(H)), as amended by subsection (a) of this section,
              is amended by adding at the end the following new clause:
            `(iii) If an individual is eligible for benefits under this title
          by reason of disability for the month preceding the month in which
          the individual attains the age of 18 years, the Commissioner shall
          redetermine such eligibility--
                `(I) during the 1-year period beginning on the individual's
              18th birthday; and
                `(II) by applying the criteria used in determining the 
              initial eligibility for applicants who are age 18 or older.
          With respect to a redetermination under this clause, paragraph (4)
          shall not apply and such redetermination shall be considered a
          substitute for a review or redetermination otherwise required under
          any other provision of this subparagraph during that 1-year period.'.
                (2) CONFORMING REPEAL- Section 207 of the Social Security
              Independence and Program Improvements Act of 1994 (42 U.S.C.
              1382 note; 108 Stat. 1516) is hereby repealed.
            (c) CONTINUING DISABILITY REVIEW REQUIRED FOR LOW BIRTH WEIGHT
          BABIES- Section 1614(a)(3)(H) (42 U.S.C. 1382c(a)(3)(H)), as 
          amended by subsections (a) and (b) of this section, is amended by
          adding at the end the following new clause:
            `(iv)(I) Not later than 12 months after the birth of an
          individual, the Commissioner shall review in accordance with
          paragraph (4) the continuing eligibility for benefits under this
          title by reason of disability of such individual whose low birth
          weight is a contributing factor material to the Commissioner's
          determination that the individual is disabled.
            `(II) A review under subclause (I) shall be considered a
          substitute for a review otherwise required under any other 
          provision of this subparagraph during that 12-month period.
            `(III) A representative payee of a recipient whose case is
          reviewed under this clause shall present, at the time of review,
          evidence demonstrating that the recipient is, and has been,
          receiving treatment, to the extent considered medically necessary
          and available, of the condition which was the basis for providing
          benefits under this title.
            `(IV) If the representative payee refuses to comply without good
          cause with the requirements of subclause (III), the Commissioner of
          Social Security shall, if the Commissioner determines it is in the
          best interest of the individual, promptly suspend payment of
          benefits to the representative payee, and provide for payment of
          benefits to an alternative representative payee of the individual
          or, if the interest of the individual under this title would be
          served thereby, to the individual.
            `(V) Subclause (III) shall not apply to the representative payee
          of any individual with respect to whom the Commissioner determines
          such application would be inappropriate or unnecessary. In making
          such determination, the Commissioner shall take into consideration
          the nature of the individual's impairment (or combination of
          impairments). Section 1631(c) shall not apply to a finding by the
          Commissioner that the requirements of subclause (III) should not
          apply to an individual's representative payee.'.
            (d) EFFECTIVE DATE- The amendments made by this section shall
          apply to benefits for months beginning on or after the date of the
          enactment of this Act, without regard to whether regulations have
          been issued to implement such amendments.
          SEC. 213. ADDITIONAL ACCOUNTABILITY REQUIREMENTS.
            (a) REQUIREMENT TO ESTABLISH ACCOUNT- Section 1631(a)(2) (42
          U.S.C. 1383(a)(2)) is amended--
                (1) by redesignating subparagraphs (F) and (G) as
              subparagraphs (G) and (H), respectively; and
                (2) by inserting after subparagraph (E) the following new
              subparagraph:
            `(F)(i)(I) Each representative payee of an eligible individual
          under the age of 18 who is eligible for the payment of benefits
          described in subclause (II) shall establish on behalf of such
          individual an account in a financial institution into which such
          benefits shall be paid, and shall thereafter maintain such account
          for use in accordance with clause (ii).
            `(II) Benefits described in this subclause are past-due monthly
          benefits under this title (which, for purposes of this subclause,
          include State supplementary payments made by the Commissioner
          pursuant to an agreement under section 1616 or section 212(b) of
          Public Law 93-66) in an amount (after any withholding by the
          Commissioner for reimbursement to a State for interim assistance
          under subsection (g)) that exceeds the product of--
                `(aa) 6, and
                `(bb) the maximum monthly benefit payable under this title to
              an eligible individual.
            `(ii)(I) A representative payee shall use funds in the account
          established under clause (i) to pay for allowable expenses 
          described in subclause (II).
            `(II) An allowable expense described in this subclause is an
          expense for--
                `(aa) education or job skills training;
                `(bb) personal needs assistance;
                `(cc) special equipment;
                `(dd) housing modification;
                `(ee) medical treatment;
                `(ff) therapy or rehabilitation; or
                `(gg) any other item or service that the Commissioner
              determines to be appropriate;
          provided that such expense benefits such individual and, in the 
          case of an expense described in item (bb), (cc), (dd), (ff), or
          (gg), is related to the impairment (or combination of impairments)
          of such individual.
            `(III) The use of funds from an account established under clause
          (i) in any manner not authorized by this clause--
                `(aa) by a representative payee shall be considered a
              misapplication of benefits for all purposes of this paragraph,
              and any representative payee who knowingly misapplies benefits
              from such an account shall be liable to the Commissioner in an
              amount equal to the total amount of such benefits; and
                `(bb) by an eligible individual who is his or her own payee
              shall be considered a misapplication of benefits for all
              purposes of this paragraph and the total amount of such 
              benefits so used shall be considered to be the uncompensated
              value of a disposed resource and shall be subject to the
              provisions of section 1613(c).
            `(IV) This clause shall continue to apply to funds in the account
          after the child has reached age 18, regardless of whether benefits
          are paid directly to the beneficiary or through a representative
          payee.
            `(iii) The representative payee may deposit into the account
          established pursuant to clause (i)--
                `(I) past-due benefits payable to the eligible individual in
              an amount less than that specified in clause (i)(II), and
                `(II) any other funds representing an underpayment under this
              title to such individual, provided that the amount of such
              underpayment is equal to or exceeds the maximum monthly benefit
              payable under this title to an eligible individual.
            `(iv) The Commissioner of Social Security shall establish a 
          system for accountability monitoring whereby such representative
          payee shall report, at such time and in such manner as the
          Commissioner shall require, on activity respecting funds in the
          account established pursuant to clause (i).'.
            (b) EXCLUSION FROM RESOURCES- Section 1613(a) (42 U.S.C. 
          1382b(a)) is amended--
                (1) by striking `and' at the end of paragraph (10);
                (2) by striking the period at the end of paragraph (11) and
              inserting `; and'; and
                (3) by inserting after paragraph (11) the following new
              paragraph:
                `(12) any account, including accrued interest or other
              earnings thereon, established and maintained in accordance with
              section 1631(a)(2)(F).'.
            (c) EXCLUSION FROM INCOME- Section 1612(b) (42 U.S.C. 1382a(b)) 
          is amended--
                (1) by striking `and' at the end of paragraph (19);
                (2) by striking the period at the end of paragraph (20) and
              inserting `; and'; and
                (3) by adding at the end the following new paragraph:
                `(21) the interest or other earnings on any account
              established and maintained in accordance with section
              1631(a)(2)(F).'.
            (d) EFFECTIVE DATE- The amendments made by this section shall
          apply to payments made after the date of the enactment of this Act.
          SEC. 214. REDUCTION IN CASH BENEFITS PAYABLE TO INSTITUTIONALIZED
                            INDIVIDUALS WHOSE MEDICAL COSTS ARE COVERED BY
                            PRIVATE INSURANCE.
            (a) IN GENERAL- Section 1611(e)(1)(B) (42 U.S.C. 1382(e)(1)(B)) 
          is amended by inserting `or, in the case of an eligible individual
          who is a child under the age of 18, receiving payments (with 
          respect to such individual) under any health insurance policy 
          issued by a private provider of such insurance' after `section
          1614(f)(2)(B),'.
            (b) EFFECTIVE DATE- The amendment made by this section shall 
          apply to benefits for months beginning 90 or more days after the
          date of the enactment of this Act, without regard to whether
          regulations have been issued to implement such amendments.
          SEC. 215. REGULATIONS.
            Within 3 months after the date of the enactment of this Act, the
          Commissioner of Social Security shall prescribe such regulations as
          may be necessary to implement the amendments made by this subtitle.
                      SUBTITLE C--ADDITIONAL ENFORCEMENT PROVISION
          SEC. 221. INSTALLMENT PAYMENT OF LARGE PAST-DUE SUPPLEMENTAL
                            SECURITY INCOME BENEFITS.
            (a) IN GENERAL- Section 1631(a) (42 U.S.C. 1383) is amended by
          adding at the end the following new paragraph:
            `(10)(A) If an individual is eligible for past-due monthly
          benefits under this title in an amount that (after any withholding
          for reimbursement to a State for interim assistance under 
          subsection (g)) equals or exceeds the product of--
                `(i) 12, and
                `(ii) the maximum monthly benefit payable under this title to
              an eligible individual (or, if appropriate, to an eligible
              indi-vidual and eligible spouse),
          then the payment of such past-due benefits (after any such
          reimbursement to a State) shall be made in installments as provided
          in subparagraph (B).
            `(B)(i) The payment of past-due benefits subject to this
          subparagraph shall be made in not to exceed 3 installments that are
          made at 6-month intervals.
            `(ii) Except as provided in clause (iii), the amount of each of
          the first and second installments may not exceed an amount equal to
          the product of clauses (i) and (ii) of subparagraph (A).
            `(iii) In the case of an individual who has--
                `(I) outstanding debt attributable to--
                    `(aa) food,
                    `(bb) clothing,
                    `(cc) shelter, or
                    `(dd) medically necessary services, supplies or 
                  equipment, or medicine; or
                `(II) current expenses or expenses anticipated in the near
              term attributable to--
                    `(aa) medically necessary services, supplies or 
                  equipment, or medicine, or
                    `(bb) the purchase of a home, and
          such debt or expenses are not subject to reimbursement by a public
          assistance program, the Secretary under title XVIII, a State plan
          approved under title XIX, or any private entity legally liable to
          provide payment pursuant to an insurance policy, pre-paid plan, or
          other arrangement, the limitation specified in clause (ii) may be
          exceeded by an amount equal to the total of such debt and expenses.
            `(C) This paragraph shall not apply to any individual who, at the
          time of the Commissioner's determination that such individual is
          eligible for the payment of past-due monthly benefits under this
          title--
                `(i) is afflicted with a medically determinable impairment
              that is expected to result in death within 12 months; or
                `(ii) is ineligible for benefits under this title and the
              Commissioner determines that such individual is likely to 
              remain ineligible for the next 12 months.
            `(D) For purposes of this paragraph, the term `benefits under 
          this title' includes supplementary payments pursuant to an 
          agreement for Federal administration under section 1616(a), and
          payments pursuant to an agreement entered into under section 212(b)
          of Public Law 93-66.'.
            (b) CONFORMING AMENDMENT- Section 1631(a)(1) (42 U.S.C.
          1383(a)(1)) is amended by inserting `(subject to paragraph (10))'
          immediately before `in such installments'.
            (c) EFFECTIVE DATE- 
                (1) IN GENERAL- The amendments made by this section are
              effective with respect to past-due benefits payable under title
              XVI of the Social Security Act after the third month following
              the month in which this Act is enacted.
                (2) BENEFITS PAYABLE UNDER TITLE XVI- For purposes of this
              subsection, the term `benefits payable under title XVI of the
              Social Security Act' includes supplementary payments pursuant 
              to an agreement for Federal administration under section 
              1616(a) of the Social Security Act, and payments pursuant to an
              agreement entered into under section 212(b) of Public Law 93-66.
          SEC. 222. REGULATIONS.
            Within 3 months after the date of the enactment of this Act, the
          Commissioner of Social Security shall prescribe such regulations as
          may be necessary to implement the amendments made by this subtitle.
           SUBTITLE D--STUDIES REGARDING SUPPLEMENTAL SECURITY INCOME PROGRAM
          SEC. 231. ANNUAL REPORT ON THE SUPPLEMENTAL SECURITY INCOME PROGRAM.
            Title XVI (42 U.S.C. 1381 et seq.), as amended by section
          105(b)(3) of the Contract with America Advancement Act of 1996, is
          amended by adding at the end the following new section:
                                `ANNUAL REPORT ON PROGRAM
            `SEC. 1637. (a) Not later than May 30 of each year, the
          Commissioner of Social Security shall prepare and deliver a report
          annually to the President and the Congress regarding the program
          under this title, including--
                `(1) a comprehensive description of the program;
                `(2) historical and current data on allowances and denials,
              including number of applications and allowance rates for 
              initial determinations, reconsideration determinations,
              administrative law judge hearings, appeals council reviews, and
              Federal court decisions;
                `(3) historical and current data on characteristics of
              recipients and program costs, by recipient group (aged, blind,
              disabled adults, and disabled children);
                `(4) historical and current data on prior enrollment by
              recipients in public benefit programs, including State programs
              funded under part A of title IV of the Social Security Act and
              State general assistance programs;
                `(5) projections of future number of recipients and program
              costs, through at least 25 years;
                `(6) number of redeterminations and continuing dis-ability
              reviews, and the outcomes of such redeterminations and reviews;
                `(7) data on the utilization of work incentives;
                `(8) detailed information on administrative and other program
              operation costs;
                `(9) summaries of relevant research undertaken by the Social
              Security Administration, or by other researchers;
                `(10) State supplementation program operations;
                `(11) a historical summary of statutory changes to this 
              title; and
                `(12) such other information as the Commissioner deems useful.
            `(b) Each member of the Social Security Advisory Board shall be
          permitted to provide an individual report, or a joint report if
          agreed, of views of the program under this title, to be included in
          the annual report required under this section.'.
          SEC. 232. STUDY BY GENERAL ACCOUNTING OFFICE.
            Not later than January 1, 1999, the Comptroller General of the
          United States shall study and report on--
                (1) the impact of the amendments made by, and the provisions
              of, this title on the supplemental security income program 
              under title XVI of the Social Security Act; and
                (2) extra expenses incurred by families of children receiving
              benefits under such title that are not covered by other 
              Federal, State, or local programs.
                                TITLE III--CHILD SUPPORT
          SEC. 300. REFERENCE TO SOCIAL SECURITY ACT.
            Except as otherwise specifically provided, wherever in this title
          an amendment is expressed in terms of an amendment to or repeal of 
          a section or other provision, the reference shall be considered to
          be made to that section or other provision of the Social Security
          Act.
             SUBTITLE A--ELIGIBILITY FOR SERVICES; DISTRIBUTION OF PAYMENTS
          SEC. 301. STATE OBLIGATION TO PROVIDE CHILD SUPPORT ENFORCEMENT
                            SERVICES.
            (a) STATE PLAN REQUIREMENTS- Section 454 (42 U.S.C. 654) is
          amended--
                (1) by striking paragraph (4) and inserting the following new
              paragraph:
                `(4) provide that the State will--
                    `(A) provide services relating to the establishment of
                  paternity or the establishment, modification, or 
                  enforcement of child support obligations, as appropriate,
                  under the plan with respect to--
                        `(i) each child for whom (I) assistance is provided
                      under the State program funded under part A of this
                      title, (II) benefits or services for foster care
                      maintenance are provided under the State program funded
                      under part E of this title, or (III) medical assistance
                      is provided under the State plan approved under title
                      XIX, unless, in accordance with paragraph (29), good
                      cause or other exceptions exist;
                        `(ii) any other child, if an individual applies for
                      such services with respect to the child; and
                    `(B) enforce any support obligation established with
                  respect to--
                        `(i) a child with respect to whom the State provides
                      services under the plan; or
                        `(ii) the custodial parent of such a child;'; and
                (2) in paragraph (6)--
                    (A) by striking `provide that' and inserting `provide
                  that--';
                    (B) by striking subparagraph (A) and inserting the
                  following new subparagraph:
                    `(A) services under the plan shall be made available to
                  residents of other States on the same terms as to residents
                  of the State submitting the plan;';
                    (C) in subparagraph (B), by inserting `on individuals not
                  receiving assistance under any State program funded under
                  part A' after `such services shall be imposed';
                    (D) in each of subparagraphs (B), (C), (D), and (E)--
                        (i) by indenting the subparagraph in the same manner
                      as, and aligning the left margin of the subparagraph
                      with the left margin of, the matter inserted by
                      subparagraph (B) of this paragraph; and
                        (ii) by striking the final comma and inserting a
                      semicolon; and
                    (E) in subparagraph (E), by indenting each of clauses (i)
                  and (ii) 2 additional ems.
            (b) CONTINUATION OF SERVICES FOR FAMILIES CEASING TO RECEIVE
          ASSISTANCE UNDER THE STATE PROGRAM FUNDED UNDER PART A- Section 454
          (42 U.S.C. 654) is amended--
                (1) by striking `and' at the end of paragraph (23);
                (2) by striking the period at the end of paragraph (24) and
              inserting `; and'; and
                (3) by adding after paragraph (24) the following new paragraph:
                `(25) provide that if a family with respect to which services
              are provided under the plan ceases to receive assistance under
              the State program funded under part A, the State shall provide
              appropriate notice to the family and continue to provide such
              services, subject to the same conditions and on the same basis
              as in the case of other individuals to whom services are
              furnished under the plan, except that an application or other
              request to continue services shall not be required of such a
              family and paragraph (6)(B) shall not apply to the family.'.
            (c) CONFORMING AMENDMENTS- 
                (1) Section 452(b) (42 U.S.C. 652(b)) is amended by striking
              `454(6)' and inserting `454(4)'.
                (2) Section 452(g)(2)(A) (42 U.S.C. 652(g)(2)(A)) is amended
              by striking `454(6)' each place it appears and inserting
              `454(4)(A)(ii)'.
                (3) Section 466(a)(3)(B) (42 U.S.C. 666(a)(3)(B)) is amended
              by striking `in the case of overdue support which a State has
              agreed to collect under section 454(6)' and inserting `in any
              other case'.
                (4) Section 466(e) (42 U.S.C. 666(e)) is amended by striking
              `paragraph (4) or (6) of section 454' and inserting `section
              454(4)'.
          SEC. 302. DISTRIBUTION OF CHILD SUPPORT COLLECTIONS.
            (a) IN GENERAL- Section 457 (42 U.S.C. 657) is amended to read as
          follows:
          `SEC. 457. DISTRIBUTION OF COLLECTED SUPPORT.
            `(a) IN GENERAL- Subject to subsection (e), an amount collected 
          on behalf of a family as support by a State pursuant to a plan
          approved under this part shall be distributed as follows:
                `(1) FAMILIES RECEIVING ASSISTANCE- In the case of a family
              receiving assistance from the State, the State shall--
                    `(A) pay to the Federal Government the Federal share of
                  the amount so collected; and
                    `(B) retain, or distribute to the family, the State share
                  of the amount so collected.
                `(2) FAMILIES THAT FORMERLY RECEIVED ASSISTANCE- In the case
              of a family that formerly received assistance from the State:
                    `(A) CURRENT SUPPORT PAYMENTS- To the extent that the
                  amount so collected does not exceed the amount required to
                  be paid to the family for the month in which collected, the
                  State shall distribute the amount so collected to the family.
                    `(B) PAYMENTS OF ARREARAGES- To the extent that the 
                  amount so collected exceeds the amount required to be paid
                  to the family for the month in which collected, the State
                  shall distribute the amount so collected as follows:
                        `(i) DISTRIBUTION OF ARREARAGES THAT ACCRUED AFTER 
                      THE FAMILY CEASED TO RECEIVE ASSISTANCE-
            `(I) PRE-OCTOBER 1997- Except as provided in subclause (II), the
          provisions of this section (other than subsection (b)(1)) as in
          effect and applied on the day before the date of the enactment of
          section 302 of the Personal Responsibility and Work Opportunity Act
          Reconciliation of 1996 shall apply with respect to the distribution
          of support arrearages that--
            `(aa) accrued after the family ceased to receive assistance, and
            `(bb) are collected before October 1, 1997.
            `(II) POST-SEPTEMBER 1997- With respect to the amount so 
          collected on or after October 1, 1997 (or before such date, at the
          option of the State)--
            `(aa) IN GENERAL- The State shall first distribute the amount so
          collected (other than any amount described in clause (iv)) to the
          family to the extent necessary to satisfy any support arrearages
          with respect to the family that accrued after the family ceased to
          receive assistance from the State.
            `(bb) REIMBURSEMENT OF GOVERNMENTS FOR ASSISTANCE PROVIDED TO THE
          FAMILY- After the application of division (aa) and clause
          (ii)(II)(aa) with respect to the amount so collected, the State
          shall retain the State share of the amount so collected, and pay to
          the Federal Government the Federal share (as defined in subsection
          (c)(2)) of the amount so collected, but only to the extent 
          necessary to reimburse amounts paid to the family as assistance by
          the State.
            `(cc) DISTRIBUTION OF THE REMAINDER TO THE FAMILY- To the extent
          that neither division (aa) nor division (bb) applies to the amount
          so collected, the State shall distribute the amount to the family.
                        `(ii) DISTRIBUTION OF ARREARAGES THAT ACCRUED BEFORE
                      THE FAMILY RECEIVED ASSISTANCE-
            `(I) PRE-OCTOBER 2000- Except as provided in subclause (II), the
          provisions of this section (other than subsection (b)(1)) as in
          effect and applied on the day before the date of the enactment of
          section 302 of the Personal Responsibility and Work Opportunity
          Reconciliation Act of 1996 shall apply with respect to the
          distribution of support arrearages that--
            `(aa) accrued before the family received assistance, and
            `(bb) are collected before October 1, 2000.
            `(II) POST-SEPTEMBER 2000- Unless, based on the report required 
          by paragraph (4), the Congress determines otherwise, with respect 
          to the amount so collected on or after October 1, 2000 (or before
          such date, at the option of the State)--
            `(aa) IN GENERAL- The State shall first distribute the amount  so
          collected (other than any amount described in clause (iv)) to the
          family to the extent necessary to satisfy any support arrearages
          with respect to the family that accrued before the family received
          assistance from the State.
            `(bb) REIMBURSEMENT OF GOVERNMENTS FOR ASSISTANCE PROVIDED TO THE
          FAMILY- After the application of clause (i)(II)(aa) and division
          (aa) with respect to the amount so collected, the State shall 
          retain the State share of the amount so collected, and pay to the
          Federal Government the Federal share (as defined in subsection
          (c)(2)) of the amount so collected, but only to the extent 
          necessary to reimburse amounts paid to the family as assistance by
          the State.
            `(cc) DISTRIBUTION OF THE REMAINDER TO THE FAMILY- To the extent
          that neither division (aa) nor division (bb) applies to the amount
          so collected, the State shall distribute the amount to the family.
                        `(iii) DISTRIBUTION OF ARREARAGES THAT ACCRUED WHILE
                      THE FAMILY RECEIVED ASSISTANCE- In the case of a family
                      described in this subparagraph, the provisions of
                      paragraph (1) shall apply with respect to the
                      distribution of support arrearages that accrued while
                      the family received assistance.
                        `(iv) AMOUNTS COLLECTED PURSUANT TO SECTION 464-
                      Notwithstanding any other provision of this section, 
                      any amount of support collected pursuant to section 464
                      shall be retained by the State to the extent past-due
                      support has been assigned to the State as a condition 
                      of receiving assistance from the State, up to the 
                      amount necessary to reimburse the State for amounts 
                      paid to the family as assistance by the State. The 
                      State shall pay to the Federal Government the Federal
                      share of the amounts so retained. To the extent the
                      amount collected pursuant to section 464 exceeds the
                      amount so retained, the State shall distribute the
                      excess to the family.
                        `(v) ORDERING RULES FOR DISTRIBUTIONS- For purposes 
                      of this subparagraph, unless an earlier effective date
                      is required by this section, effective October 1, 2000,
                      the State shall treat any support arrearages collected,
                      except for amounts collected pursuant to section 464, 
                      as accruing in the following order:
            `(I) To the period after the family ceased to receive assistance.
            `(II) To the period before the family received assistance.
            `(III) To the period while the family was receiving assistance.
                `(3) FAMILIES THAT NEVER RECEIVED ASSISTANCE- In the case of
              any other family, the State shall distribute the amount so
              collected to the family.
                `(4) FAMILIES UNDER CERTAIN AGREEMENTS- In the case of a
              family receiving assistance from an Indian tribe, distribute 
              the amount so collected pursuant to an agreement entered into
              pursuant to a State plan under section 454(33).
                `(5) STUDY AND REPORT- Not later than October 1, 1998, the
              Secretary shall report to the Congress the Secretary's findings
              with respect to--
                    `(A) whether the distribution of post-assistance
                  arrearages to families has been effective in moving people
                  off of welfare and keeping them off of welfare;
                    `(B) whether early implementation of a pre-assistance
                  arrearage program by some States has been effective in
                  moving people off of welfare and keeping them off of welfare;
                    `(C) what the overall impact has been of the amendments
                  made by the Personal Responsibility and Work Opportunity 
                  Act of 1996 with respect to child support enforcement in
                  moving people off of welfare and keeping them off of
                  welfare; and
                    `(D) based on the information and data the Secretary has
                  obtained, what changes, if any, should be made in the
                  policies related to the distribution of child support
                  arrearages.
            `(b) CONTINUATION OF ASSIGNMENTS- Any rights to support
          obligations, which were assigned to a State as a condition of
          receiving assistance from the State under part A and which were in
          effect on the day before the date of the enactment of the Personal
          Responsibility and Work Opportunity Act of 1996, shall remain
          assigned after such date.
            `(c) DEFINITIONS- As used in subsection (a):
                `(1) ASSISTANCE- The term `assistance from the State' means--
                    `(A) assistance under the State program funded under part
                  A or under the State plan approved under part A of this
                  title (as in effect on the day before the date of the
                  enactment of the Personal Responsibility and Work
                  Opportunity Act of 1996); and
                    `(B) foster care maintenance payments under the State 
                  plan approved under part E of this title.
                `(2) FEDERAL SHARE- The term `Federal share' means that
              portion of the amount collected resulting from the application
              of the Federal medical assistance percentage in effect for the
              fiscal year in which the amount is collected.
                `(3) FEDERAL MEDICAL ASSISTANCE PERCENTAGE- The term `Federal
              medical assistance percentage' means--
                    `(A) the Federal medical assistance percentage (as 
                  defined in section 1118), in the case of Puerto Rico, the
                  Virgin Islands, Guam, and American Samoa; or
                    `(B) the Federal medical assistance percentage (as 
                  defined in section 1905(b), as in effect on September 30,
                  1996) in the case of any other State.
                `(4) STATE SHARE- The term `State share' means 100 percent
              minus the Federal share.
            `(d) HOLD HARMLESS PROVISION- If the amounts collected which 
          could be retained by the State in the fiscal year (to the extent
          necessary to reimburse the State for amounts paid to families as
          assistance by the State) are less than the State share of the
          amounts collected in fiscal year 1995 (determined in accordance 
          with section 457 as in effect on the day before the date of the
          enactment of the Personal Responsibility and Work Opportunity Act 
          of 1996), the State share for the fiscal year shall be an amount
          equal to the State share in fiscal year 1995.
            `(e) GAP PAYMENTS NOT SUBJECT TO DISTRIBUTION UNDER THIS SECTION-
          At State option, this section shall not apply to any amount
          collected on behalf of a family as support by the State (and paid 
          to the family in addition to the amount of assistance otherwise
          payable to the family) pursuant to a plan approved under this part
          if such amount would have been paid to the family by the State 
          under section 402(a)(28), as in effect and applied on the day 
          before the date of the enactment of section 302 of the Personal
          Responsibility and Work Opportunity Reconciliation Act of 1996. For
          purposes of subsection (d), the State share of such amount paid to
          the family shall be considered amounts which could be retained by
          the State if such payments were reported by the State as part of 
          the State share of amounts collected in fiscal year 1995.'.
            (b) CONFORMING AMENDMENTS- 
                (1) Section 464(a)(1) (42 U.S.C. 664(a)(1)) is amended by
              striking `section 457(b)(4) or (d)(3)' and inserting `section
              457'.
                (2) Section 454 (42 U.S.C. 654) is amended--
                    (A) in paragraph (11)--
                        (i) by striking `(11)' and inserting `(11)(A)'; and
                        (ii) by inserting after the semicolon `and'; and
                    (B) by redesignating paragraph (12) as subparagraph (B) 
                  of paragraph (11).
            (c) EFFECTIVE DATES- 
                (1) IN GENERAL- Except as provided in paragraph (2), the
              amendments made by this section shall be effective on October 
              1, 1996, or earlier at the State's option.
                (2) CONFORMING AMENDMENTS- The amendments made by subsection
              (b)(2) shall become effective on the date of the enactment of
              this Act.
          SEC. 303. PRIVACY SAFEGUARDS.
            (a) STATE PLAN REQUIREMENT- Section 454 (42 U.S.C. 654), as
          amended by section 301(b) of this Act, is amended--
                (1) by striking `and' at the end of paragraph (24);
                (2) by striking the period at the end of paragraph (25) and
              inserting `; and'; and
                (3) by adding after paragraph (25) the following new paragraph:
                `(26) will have in effect safeguards, applicable to all
              confidential information handled by the State agency, that are
              designed to protect the privacy rights of the parties,
              including--
                    `(A) safeguards against unauthorized use or disclosure of
                  information relating to proceedings or actions to establish
                  paternity, or to establish or enforce support;
                    `(B) prohibitions against the release of information on
                  the whereabouts of 1 party to another party against whom a
                  protective order with respect to the former party has been
                  entered; and
                    `(C) prohibitions against the release of information on
                  the whereabouts of 1 party to another party if the State 
                  has reason to believe that the release of the information
                  may result in physical or emotional harm to the former
                  party.'.
            (b) EFFECTIVE DATE- The amendment made by subsection (a) shall
          become effective on October 1, 1997.
          SEC. 304. RIGHTS TO NOTIFICATION OF HEARINGS.
            (a) IN GENERAL- Section 454 (42 U.S.C. 654), as amended by 
          section 302(b)(2) of this Act, is amended by inserting after
          paragraph (11) the following new paragraph:
                `(12) provide for the establishment of procedures to require
              the State to provide individuals who are applying for or
              receiving services under the State plan, or who are parties to
              cases in which services are being provided under the State plan--
                    `(A) with notice of all proceedings in which support
                  obligations might be established or modified; and
                    `(B) with a copy of any order establishing or modifying a
                  child support obligation, or (in the case of a petition for
                  modification) a notice of determination that there should 
                  be no change in the amount of the child support award,
                  within 14 days after issuance of such order or
                  determination;'.
            (b) EFFECTIVE DATE- The amendment made by subsection (a) shall
          become effective on October 1, 1997.
                          SUBTITLE B--LOCATE AND CASE TRACKING
          SEC. 311. STATE CASE REGISTRY.
            Section 454A, as added by section 344(a)(2) of this Act, is
          amended by adding at the end the following new subsections:
            `(e) STATE CASE REGISTRY- 
                `(1) CONTENTS- The automated system required by this section
              shall include a registry (which shall be known as the `State
              case registry') that contains records with respect to--
                    `(A) each case in which services are being provided by 
                  the State agency under the State plan approved under this
                  part; and
                    `(B) each support order established or modified in the
                  State on or after October 1, 1998.
                `(2) LINKING OF LOCAL REGISTRIES- The State case registry may
              be established by linking local case registries of support
              orders through an automated information network, subject to 
              this section.
                `(3) USE OF STANDARDIZED DATA ELEMENTS- Such records shall 
              use standardized data elements for both parents (such as names,
              social security numbers and other uniform identification
              numbers, dates of birth, and case identification numbers), and
              contain such other information (such as on case status) as the
              Secretary may require.
                `(4) PAYMENT RECORDS- Each case record in the State case
              registry with respect to which services are being provided 
              under the State plan approved under this part and with respect
              to which a support order has been established shall include a
              record of--
                    `(A) the amount of monthly (or other periodic) support
                  owed under the order, and other amounts (including
                  arrearages, interest or late payment penalties, and fees)
                  due or overdue under the order;
                    `(B) any amount described in subparagraph (A) that has
                  been collected;
                    `(C) the distribution of such collected amounts;
                    `(D) the birth date of any child for whom the order
                  requires the provision of support; and
                    `(E) the amount of any lien imposed with respect to the
                  order pursuant to section 466(a)(4).
                `(5) UPDATING AND MONITORING- The State agency operating the
              automated system required by this section shall promptly
              establish and update, maintain, and regularly monitor, case
              records in the State case registry with respect to which
              services are being provided under the State plan approved under
              this part, on the basis of--
                    `(A) information on administrative actions and
                  administrative and judicial proceedings and orders relating
                  to paternity and support;
                    `(B) information obtained from comparison with Federal,
                  State, or local sources of information;
                    `(C) information on support collections and 
                  distributions; and
                    `(D) any other relevant information.
            `(f) INFORMATION COMPARISONS AND OTHER DISCLOSURES OF 
          INFORMATION- The State shall use the automated system required by
          this section to extract information from (at such times, and in 
          such standardized format or formats, as may be required by the
          Secretary), to share and compare information with, and to receive
          information from, other data bases and information comparison
          services, in order to obtain (or provide) information necessary to
          enable the State agency (or the Secretary or other State or Federal
          agencies) to carry out this part, subject to section 6103 of the
          Internal Revenue Code of 1986. Such information comparison
          activities shall include the following:
                `(1) FEDERAL CASE REGISTRY OF CHILD SUPPORT ORDERS- 
              Furnishing to the Federal Case Registry of Child Support Orders
              established under section 453(h) (and update as necessary, with
              information including notice of expiration of orders) the
              minimum amount of information on child support cases recorded 
              in the State case registry that is necessary to operate the
              registry (as specified by the Secretary in regulations).
                `(2) FEDERAL PARENT LOCATOR SERVICE- Exchanging information
              with the Federal Parent Locator Service for the purposes
              specified in section 453.
                `(3) TEMPORARY FAMILY ASSISTANCE AND MEDICAID AGENCIES-
              Exchanging information with State agencies (of the State and of
              other States) administering programs funded under part A,
              programs operated under a State plan approved under title XIX,
              and other programs designated by the Secretary, as necessary to
              perform State agency responsibilities under this part and under
              such programs.
                `(4) INTRASTATE AND INTERSTATE INFORMATION COMPARISONS-
              Exchanging information with other agencies of the State,
              agencies of other States, and interstate information networks,
              as necessary and appropriate to carry out (or assist other
              States to carry out) the purposes of this part.'.
          SEC. 312. COLLECTION AND DISBURSEMENT OF SUPPORT PAYMENTS.
            (a) STATE PLAN REQUIREMENT- Section 454 (42 U.S.C. 654), as
          amended by sections 301(b) and 303(a) of this Act, is amended--
                (1) by striking `and' at the end of paragraph (25);
                (2) by striking the period at the end of paragraph (26) and
              inserting `; and'; and
                (3) by adding after paragraph (26) the following new paragraph:
                `(27) provide that, on and after October 1, 1998, the State
              agency will--
                    `(A) operate a State disbursement unit in accordance with
                  section 454B; and
                    `(B) have sufficient State staff (consisting of State
                  employees) and (at State option) contractors reporting
                  directly to the State agency to--
                        `(i) monitor and enforce support collections through
                      the unit in cases being enforced by the State pursuant
                      to section 454(4) (including carrying out the automated
                      data processing responsibilities described in section
                      454A(g)); and
                        `(ii) take the actions described in section 466(c)(1)
                      in appropriate cases.'.
            (b) ESTABLISHMENT OF STATE DISBURSEMENT UNIT- Part D of title IV
          (42 U.S.C. 651-669), as amended by section 344(a)(2) of this Act, 
          is amended by inserting after section 454A the following new section:
          `SEC. 454B. COLLECTION AND DISBURSEMENT OF SUPPORT PAYMENTS.
            `(a) STATE DISBURSEMENT UNIT- 
                `(1) IN GENERAL- In order for a State to meet the 
              requirements of this section, the State agency must establish
              and operate a unit (which shall be known as the `State
              disbursement unit') for the collection and disbursement of
              payments under support orders--
                    `(A) in all cases being enforced by the State pursuant to
                  section 454(4); and
                    `(B) in all cases not being enforced by the State under
                  this part in which the support order is initially issued in
                  the State on or after January 1, 1994, and in which the
                  income of the noncustodial parent is subject to withholding
                  pursuant to section 466(a)(8)(B).
                `(2) OPERATION- The State disbursement unit shall be operated--
                    `(A) directly by the State agency (or 2 or more State
                  agencies under a regional cooperative agreement), or (to 
                  the extent appropriate) by a contractor responsible 
                  directly to the State agency; and
                    `(B) except in cases described in paragraph (1)(B), in
                  coordination with the automated system established by the
                  State pursuant to section 454A.
                `(3) LINKING OF LOCAL DISBURSEMENT UNITS- The State
              disbursement unit may be established by linking local
              disbursement units through an automated information network,
              subject to this section,  if the Secretary agrees that the
              system will not cost more nor take more time to establish or
              operate than a centralized system. In addition, employers shall
              be given 1 location to which income withholding is sent.
            `(b) REQUIRED PROCEDURES- The State disbursement unit shall use
          automated procedures, electronic processes, and computer-driven
          technology to the maximum extent feasible, efficient, and
          economical, for the collection and disbursement of support 
          payments, including procedures--
                `(1) for receipt of payments from parents, employers, and
              other States, and for disbursements to custodial parents and
              other obligees, the State agency, and the agencies of other
              States;
                `(2) for accurate identification of payments;
                `(3) to ensure prompt disbursement of the custodial parent's
              share of any payment; and
                `(4) to furnish to any parent, upon request, timely
              information on the current status of support payments under an
              order requiring payments to be made by or to the parent, except
              that in cases described in subsection (a)(1)(B), the State
              disbursement unit shall not be required to convert and maintain
              in automated form records of payments kept pursuant to section
              466(a)(8)(B)(iii) before the effective date of this section.
            `(c) TIMING OF DISBURSEMENTS- 
                `(1) IN GENERAL- Except as provided in paragraph (2), the
              State disbursement unit shall distribute all amounts payable
              under section 457(a) within 2 business days after receipt from
              the employer or other source of periodic income, if sufficient
              information identifying the payee is provided.
                `(2) PERMISSIVE RETENTION OF ARREARAGES- The State
              disbursement unit may delay the distribution of collections
              toward arrearages until the resolution of any timely appeal 
              with respect to such arrearages.
            `(d) BUSINESS DAY DEFINED- As used in this section, the term
          `business day' means a day on which State offices are open for
          regular business.'.
            (c) USE OF AUTOMATED SYSTEM- Section 454A, as added by section
          344(a)(2) and as amended by section 311 of this Act, is amended by
          adding at the end the following new subsection:
            `(g) COLLECTION AND DISTRIBUTION OF SUPPORT PAYMENTS- 
                `(1) IN GENERAL- The State shall use the automated system
              required by this section, to the maximum extent feasible, to
              assist and facilitate the collection and disbursement of 
              support payments through the State disbursement unit operated
              under section 454B, through the performance of functions,
              including, at a minimum--
                    `(A) transmission of orders and notices to employers (and
                  other debtors) for the withholding of income--
                        `(i) within 2 business days after receipt of notice
                      of, and the income source subject to, such withholding
                      from a court, another State, an employer, the Federal
                      Parent Locator Service, or another source recognized by
                      the State; and
                        `(ii) using uniform formats prescribed by the
                      Secretary;
                    `(B) ongoing monitoring to promptly identify failures to
                  make timely payment of support; and
                    `(C) automatic use of enforcement procedures (including
                  procedures authorized pursuant to section 466(c)) if
                  payments are not timely made.
                `(2) BUSINESS DAY DEFINED- As used in paragraph (1), the term
              `business day' means a day on which State offices are open for
              regular business.'.
            (d) EFFECTIVE DATES- 
                (1) IN GENERAL- Except as provided in paragraph (2), the
              amendments made by this section shall become effective on
              October 1, 1998.
                (2) LIMITED EXCEPTION TO UNIT HANDLING PAYMENTS-
              Notwithstanding section 454B(b)(1) of the Social Security Act,
              as added by this section, any State which, as of the date of 
              the enactment of this Act, processes the receipt of child
              support payments through local courts may, at the option of the
              State, continue to process through September 30, 1999, such
              payments through such courts as processed such payments on or
              before such date of enactment.
          SEC. 313. STATE DIRECTORY OF NEW HIRES.
            (a) STATE PLAN REQUIREMENT- Section 454 (42 U.S.C. 654), as
          amended by sections 301(b), 303(a), and 312(a) of this Act, is
          amended--
                (1) by striking `and' at the end of paragraph (26);
                (2) by striking the period at the end of paragraph (27) and
              inserting `; and'; and
                (3) by adding after paragraph (27) the following new paragraph:
                `(28) provide that, on and after October 1, 1997, the State
              will operate a State Directory of New Hires in accordance with
              section 453A.'.
            (b) STATE DIRECTORY OF NEW HIRES- Part D of title IV (42 U.S.C.
          651-669) is amended by inserting after section 453 the following 
          new section:
          `SEC. 453A. STATE DIRECTORY OF NEW HIRES.
            `(a) ESTABLISHMENT- 
                `(1) IN GENERAL- 
                    `(A) REQUIREMENT FOR STATES THAT HAVE NO DIRECTORY- 
                  Except as provided in subparagraph (B), not later than
                  October 1, 1997, each State shall establish an automated
                  directory (to be known as the `State Directory of New
                  Hires') which shall contain information supplied in
                  accordance with subsection (b) by employers on each newly
                  hired employee.
                    `(B) STATES WITH NEW HIRE REPORTING LAW IN EXISTENCE- A
                  State which has a new hire reporting law in existence on 
                  the date of the enactment of this section may continue to
                  operate under the State law, but the State must meet the
                  requirements of subsection (g)(2) not later than October 1,
                  1997, and the requirements of this section (other than
                  subsection (g)(2)) not later than October 1, 1998.
                `(2) DEFINITIONS- As used in this section:
                    `(A) EMPLOYEE- The term `employee'--
                        `(i) means an individual who is an employee within 
                      the meaning of chapter 24 of the Internal Revenue Code
                      of 1986; and
                        `(ii) does not include an employee of a Federal or
                      State agency performing intelligence or
                      counterintelligence functions, if the head of such
                      agency has determined that reporting pursuant to
                      paragraph (1) with respect to the employee could
                      endanger the safety of the employee or compromise an
                      ongoing investigation or intelligence mission.
                    `(B) EMPLOYER- 
                        `(i) IN GENERAL- The term `employer' has the meaning
                      given such term in section 3401(d) of the Internal
                      Revenue Code of 1986 and includes any governmental
                      entity and any labor organization.
                        `(ii) LABOR ORGANIZATION- The term `labor
                      organization' shall have the meaning given such term in
                      section 2(5) of the National Labor Relations Act, and
                      includes any entity (also known as a `hiring hall')
                      which is used by the organization and an employer to
                      carry out requirements described in section 8(f)(3) of
                      such Act of an agreement between the organization and
                      the employer.
            `(b) EMPLOYER INFORMATION- 
                `(1) REPORTING REQUIREMENT- 
                    `(A) IN GENERAL- Except as provided in subparagraphs (B)
                  and (C), each employer shall furnish to the Directory of 
                  New Hires of the State in which a newly hired employee
                  works, a report that contains the name, address, and social
                  security number of the employee, and the name and address
                  of, and identifying number assigned under section 6109 of
                  the Internal Revenue Code of 1986 to, the employer.
                    `(B) MULTISTATE EMPLOYERS- An employer that has employees
                  who are employed in 2 or more States and that transmits
                  reports magnetically or electronically may comply with
                  subparagraph (A) by designating 1 State in which such
                  employer has employees to which the employer  will transmit
                  the report described in subparagraph (A), and transmitting
                  such report to such State. Any employer that transmits
                  reports pursuant to this subparagraph shall notify the
                  Secretary in writing as to which State such employer
                  designates for the purpose of sending reports.
                    `(C) FEDERAL GOVERNMENT EMPLOYERS- Any department, 
                  agency, or instrumentality of the United States shall 
                  comply with subparagraph (A) by transmitting the report
                  described in subparagraph (A) to the National Directory of
                  New Hires established pursuant to section 453.
                `(2) TIMING OF REPORT- Each State may provide the time within
              which the report required by paragraph (1) shall be made with
              respect to an employee, but such report shall be made--
                    `(A) not later than 20 days after the date the employer
                  hires the employee; or
                    `(B) in the case of an employer transmitting reports
                  magnetically or electronically, by 2 monthly transmissions
                  (if necessary) not less than 12 days nor more than 16 days
                  apart.
            `(c) REPORTING FORMAT AND METHOD- Each report required by
          subsection (b) shall be made on a W-4 form or, at the option of the
          employer, an equivalent form, and may be transmitted by 1st class
          mail, magnetically, or electronically.
            `(d) CIVIL MONEY PENALTIES ON NONCOMPLYING EMPLOYERS- The State
          shall have the option to set a State civil money penalty which 
          shall be less than--
                `(1) $25; or
                `(2) $500 if, under State law, the failure is the result of a
              conspiracy between the employer and the employee to not supply
              the required report or to supply a false or incomplete report.
            `(e) ENTRY OF EMPLOYER INFORMATION- Information shall be entered
          into the data base maintained by the State Directory of New Hires
          within 5 business days of receipt from an employer pursuant to
          subsection (b).
            `(f) INFORMATION COMPARISONS- 
                `(1) IN GENERAL- Not later than May 1, 1998, an agency
              designated by the State shall, directly or by contract, conduct
              automated comparisons of the social security numbers reported 
              by employers pursuant to subsection (b) and the social security
              numbers appearing in the records of the State case registry for
              cases being enforced under the State plan.
                `(2) NOTICE OF MATCH- When an information comparison 
              conducted under paragraph (1) reveals a match with respect to
              the social security number of an individual required to provide
              support under a support order, the State Directory of New Hires
              shall provide the agency administering the State plan approved
              under this part of the appropriate State with the name, 
              address, and social security number of the employee to whom the
              social security number is assigned, and the name and address 
              of, and identifying number assigned under section 6109 of the
              Internal Revenue Code of 1986 to, the employer.
            `(g) TRANSMISSION OF INFORMATION- 
                `(1) TRANSMISSION OF WAGE WITHHOLDING NOTICES TO EMPLOYERS-
              Within 2 business days after the date information regarding a
              newly hired employee is entered into the State Directory of New
              Hires, the State agency enforcing the employee's child support
              obligation shall transmit a notice to the employer of the
              employee directing the employer to withhold from the income of
              the employee an amount equal to the monthly (or other periodic)
              child support obligation (including any past due support
              obligation) of the employee, unless the employee's income is 
              not subject to withholding pursuant to section 466(b)(3).
                `(2) TRANSMISSIONS TO THE NATIONAL DIRECTORY OF NEW HIRES- 
                    `(A) NEW HIRE INFORMATION- Within 3 business days after
                  the date information regarding a newly hired employee is
                  entered into the State Directory of New Hires, the State
                  Directory of New Hires shall furnish the information to the
                  National Directory of New Hires.
                    `(B) WAGE AND UNEMPLOYMENT COMPENSATION INFORMATION- The
                  State Directory of New Hires shall, on a quarterly basis,
                  furnish to the National Directory of New Hires extracts of
                  the reports required under section 303(a)(6) to be made to
                  the Secretary of Labor concerning the wages and 
                  unemployment compensation paid to individuals, by such
                  dates, in such format, and containing such information as
                  the Secretary of Health and Human Services shall specify in
                  regulations.
                `(3) BUSINESS DAY DEFINED- As used in this subsection, the
              term `business day' means a day on which State offices are open
              for regular business.
            `(h) OTHER USES OF NEW HIRE INFORMATION- 
                `(1) LOCATION OF CHILD SUPPORT OBLIGORS- The agency
              administering the State plan approved under this part shall use
              information received pursuant to subsection (f)(2) to locate
              individuals for purposes of establishing paternity and
              establishing, modifying, and enforcing child support
              obligations, and may disclose such information to any agent of
              the agency that is under contract with the agency to carry out
              such purposes.
                `(2) VERIFICATION OF ELIGIBILITY FOR CERTAIN PROGRAMS- A 
              State agency responsible for administering a program specified
              in section 1137(b) shall have access to information reported by
              employers pursuant to subsection (b) of this section for
              purposes of verifying eligibility for the program.
                `(3) ADMINISTRATION OF EMPLOYMENT SECURITY AND WORKERS'
              COMPENSATION- State agencies operating employment security and
              workers' compensation programs shall have access to information
              reported by employers pursuant to subsection (b) for the
              purposes of administering such programs.'.
            (c) QUARTERLY WAGE REPORTING- Section 1137(a)(3) (42 U.S.C.
          1320b-7(a)(3)) is amended--
                (1) by inserting `(including State and local governmental
              entities and labor organizations (as defined in section
              453A(a)(2)(B)(iii))' after `employers'; and
                (2) by inserting `, and except that no report shall be filed
              with respect to an employee of a State or local agency
              performing intelligence or counterintelligence functions, if 
              the head of such agency has determined that filing such a 
              report could endanger the safety of the employee or compromise
              an ongoing investigation or intelligence mission' after
              `paragraph (2)'.
            (d) DISCLOSURE TO CERTAIN AGENTS- Section 303(e) (42 U.S.C.
          503(e)) is amended by adding at the end the following:
            `(5) A State or local child support enforcement agency may
          disclose to any agent of the agency that is under contract with the
          agency to carry out the purposes described in paragraph (1)(B) wage
          information that is disclosed to an officer or employee of the
          agency under paragraph (1)(A). Any agent of a State or local child
          support agency that receives wage information under this paragraph
          shall comply with the safeguards established pursuant to paragraph
          (1)(B).'.
          SEC. 314. AMENDMENTS CONCERNING INCOME WITHHOLDING.
            (a) MANDATORY INCOME WITHHOLDING- 
                (1) IN GENERAL- Section 466(a)(1) (42 U.S.C. 666(a)(1)) is
              amended to read as follows:
                `(1)(A) Procedures described in subsection (b) for the
              withholding from income of amounts payable as support in cases
              subject to enforcement under the State plan.
                `(B) Procedures under which the income of a person with a
              support obligation imposed by a support order issued (or
              modified) in the State before October 1, 1996, if not otherwise
              subject to withholding under subsection (b), shall become
              subject to withholding as provided in subsection (b) if
              arrearages occur, without the need for a judicial or
              administrative hearing.'.
                (2) CONFORMING AMENDMENTS- 
                    (A) Section 466(b) (42 U.S.C. 666(b)) is amended in the
                  matter preceding paragraph (1), by striking `subsection
                  (a)(1)' and inserting `subsection (a)(1)(A)'.
                    (B) Section 466(b)(4) (42 U.S.C. 666(b)(4)) is amended to
                  read as follows:
                `(4)(A) Such withholding must be carried out in full
              compliance with all procedural due process requirements of the
              State, and the State must send notice to each noncustodial
              parent to whom paragraph (1) applies--
                    `(i) that the withholding has commenced; and
                    `(ii) of the procedures to follow if the noncustodial
                  parent desires to contest such withholding on the grounds
                  that the withholding or the amount withheld is improper due
                  to a mistake of fact.
                `(B) The notice under subparagraph (A) of this paragraph 
              shall include the information provided to the employer under
              paragraph (6)(A).'.
                    (C) Section 466(b)(5) (42 U.S.C. 666(b)(5)) is amended by
                  striking all that follows `administered by' and inserting
                  `the State through the State disbursement unit established
                  pursuant to section 454B, in accordance with the
                  requirements of section 454B.'.
                    (D) Section 466(b)(6)(A) (42 U.S.C. 666(b)(6)(A)) is
                  amended--
                        (i) in clause (i), by striking `to the appropriate
                      agency' and all that follows and inserting `to the 
                      State disbursement unit within 7 business days after 
                      the date the amount would (but for this subsection) 
                      have been paid or credited to the employee, for
                      distribution in accordance with this part. The employer
                      shall withhold funds as directed in the notice, except
                      that when an employer receives an income withholding
                      order issued by another State, the employer shall apply
                      the income withholding law of the state of the 
                      obligor's principal place of employment in determining--
                    `(I) the employer's fee for processing an income
                  withholding order;
                    `(II) the maximum amount permitted to be withheld from 
                  the obligor's income;
                    `(III) the time periods within which the employer must
                  implement the income withholding order and forward the 
                  child support payment;
                    `(IV) the priorities for withholding and allocating 
                  income withheld for multiple child support obligees; and
                    `(V) any withholding terms or conditions not specified in
                  the order.
              An employer who complies with an income withholding notice that
              is regular on its face shall not be subject to civil liability
              to any individual or agency for conduct in compliance with the
              notice.';
                        (ii) in clause (ii), by inserting `be in a standard
                      format prescribed by the Secretary, and' after `shall';
                      and
                        (iii) by adding at the end the following new clause:
                `(iii) As used in this subparagraph, the term `business day'
              means a day on which State offices are open for regular
              business.'.
                    (E) Section 466(b)(6)(D) (42 U.S.C. 666(b)(6)(D)) is
                  amended by striking `any employer' and all that follows and
                  inserting `any employer who--
                    `(i) discharges from employment, refuses to employ, or
                  takes disciplinary action against any noncustodial parent
                  subject to income withholding required by this subsection
                  because of the existence of such withholding and the
                  obligations or additional obligations which it imposes upon
                  the employer; or
                    `(ii) fails to withhold support from income or to pay 
                  such amounts to the State disbursement unit in accordance
                  with this subsection.'.
                    (F) Section 466(b) (42 U.S.C. 666(b)) is amended by 
                  adding at the end the following new paragraph:
                `(11) Procedures under which the agency administering the
              State plan approved under this part may execute a withholding
              order without advance notice to the obligor, including issuing
              the withholding order through electronic means.'.
            (b) DEFINITION OF INCOME- 
                (1) IN GENERAL- Section 466(b)(8) (42 U.S.C. 666(b)(8)) is
              amended to read as follows:
                `(8) For purposes of subsection (a) and this subsection, the
              term `income' means any periodic form of payment due to an
              individual, regardless of source, including wages, salaries,
              commissions, bonuses, worker's compensation, disability,
              payments pursuant to a pension or retirement program, and
              interest.'.
                (2) CONFORMING AMENDMENTS- 
                    (A) Subsections (a)(8)(A), (a)(8)(B)(i), (b)(3)(A),
                  (b)(3)(B), (b)(6)(A)(i), and (b)(6)(C), and (b)(7) of
                  section 466 (42 U.S.C. 666(a)(8)(A), (a)(8)(B)(i),
                  (b)(3)(A), (b)(3)(B), (b)(6)(A)(i), and (b)(6)(C), and
                  (b)(7)) are each amended by striking `wages' each place 
                  such term appears and inserting `income'.
                    (B) Section 466(b)(1) (42 U.S.C. 666(b)(1)) is amended by
                  striking `wages (as defined by the State for purposes of
                  this section)' and inserting `income'.
            (c) CONFORMING AMENDMENT- Section 466(c) (42 U.S.C. 666(c)) is
          repealed.
          SEC. 315. LOCATOR INFORMATION FROM INTERSTATE NETWORKS.
            Section 466(a) (42 U.S.C. 666(a)) is amended by inserting after
          paragraph (11) the following new paragraph:
                `(12) LOCATOR INFORMATION FROM INTERSTATE NETWORKS- 
              Procedures to ensure that all Federal and State agencies
              conducting activities under this part have access to any system
              used by the State to locate an individual for purposes relating
              to motor vehicles or law enforcement.'.
          SEC. 316. EXPANSION OF THE FEDERAL PARENT LOCATOR SERVICE.
            (a) EXPANDED AUTHORITY TO LOCATE INDIVIDUALS AND ASSETS- Section
          453 (42 U.S.C. 653) is amended--
                (1) in subsection (a), by striking all that follows
              `subsection (c))' and inserting `, for the purpose of
              establishing parentage, establishing, setting the amount of,
              modifying, or enforcing child support obligations, or enforcing
              child custody or visitation orders--
                `(1) information on, or facilitating the discovery of, the
              location of any individual--
                    `(A) who is under an obligation to pay child support or
                  provide child custody or visitation rights;
                    `(B) against whom such an obligation is sought;
                    `(C) to whom such an obligation is owed,
              including the individual's social security number (or numbers),
              most recent address, and the name, address, and employer
              identification number of the individual's employer;
                `(2) information on the individual's wages (or other income)
              from, and benefits of, employment (including rights to or
              enrollment in group health care coverage); and
                `(3) information on the type, status, location, and amount of
              any assets of, or debts owed by or to, any such indi-vidual.';
              and
                (2) in subsection (b)--
                    (A) in the matter preceding paragraph (1), by striking
                  `social security' and all that follows through `absent
                  parent' and inserting `information described in subsection
                  (a)'; and
                    (B) in the flush paragraph at the end, by adding the
                  following: `No information shall be disclosed to any person
                  if the State has notified the Secretary that the State has
                  reasonable evidence of domestic violence or child abuse and
                  the disclosure of such information could be harmful to the
                  custodial parent or the child of such parent. Information
                  received or transmitted pursuant to this section shall be
                  subject to the safeguard provisions  contained in section
                  454(26).'.
            (b) AUTHORIZED PERSON FOR INFORMATION REGARDING VISITATION 
          RIGHTS- Section 453(c) (42 U.S.C. 653(c)) is amended--
                (1) in paragraph (1), by striking `support' and inserting
              `support or to seek to enforce orders providing child custody 
              or visitation rights'; and
                (2) in paragraph (2), by striking `, or any agent of such
              court; and' and inserting `or to issue an order against a
              resident parent for child custody or visitation rights, or any
              agent of such court;'.
            (c) REIMBURSEMENT FOR INFORMATION FROM FEDERAL AGENCIES- Section
          453(e)(2) (42 U.S.C. 653(e)(2)) is amended in the 4th sentence by
          inserting `in an amount which the Secretary determines to be
          reasonable payment for the information exchange (which amount shall
          not include payment for the costs of obtaining, compiling, or
          maintaining the information)' before the period.
            (d) REIMBURSEMENT FOR REPORTS BY STATE AGENCIES- Section 453 (42
          U.S.C. 653) is amended by adding at the end the following new
          subsection:
            `(g) REIMBURSEMENT FOR REPORTS BY STATE AGENCIES- The Secretary
          may reimburse Federal and State agencies for the costs incurred by
          such entities in furnishing information requested by the Secretary
          under this section in an amount which the Secretary determines to 
          be reasonable payment for the information exchange (which amount
          shall not include payment for the costs of obtaining, compiling, or
          maintaining the information).'.
            (e) CONFORMING AMENDMENTS- 
                (1) Sections 452(a)(9), 453(a), 453(b), 463(a), 463(e), and
              463(f) (42 U.S.C. 652(a)(9), 653(a), 653(b), 663(a), 663(e), 
              and 663(f)) are each amended by inserting `Federal' before
              `Parent' each place such term appears.
                (2) Section 453 (42 U.S.C. 653) is amended in the heading by
              adding `FEDERAL' before `PARENT'.
            (f) NEW COMPONENTS- Section 453 (42 U.S.C. 653), as amended by
          subsection (d) of this section, is amended by adding at the end the
          following new subsections:
            `(h) FEDERAL CASE REGISTRY OF CHILD SUPPORT ORDERS- 
                `(1) IN GENERAL- Not later than October 1, 1998, in order to
              assist States in administering programs under State plans
              approved under this part and programs funded under part A, and
              for the other purposes specified in this section, the Secretary
              shall establish and maintain in the Federal Parent Locator
              Service an automated registry (which shall be known as the
              `Federal Case Registry of Child Support Orders'), which shall
              contain abstracts of support orders and other information
              described in paragraph (2) with respect to each case in each
              State case registry maintained pursuant to section 454A(e), as
              furnished (and regularly updated), pursuant to section 454A(f),
              by State agencies administering programs under this part.
                `(2) CASE INFORMATION- The information referred to in
              paragraph (1) with respect to a case shall be such information
              as the Secretary may specify in regulations (including the
              names, social security numbers or other uniform identification
              numbers, and State case identification numbers) to identify the
              individuals who owe or are owed support (or with respect to or
              on behalf of whom support obligations are sought to be
              established), and the State or States which have the case.
            `(i) NATIONAL DIRECTORY OF NEW HIRES- 
                `(1) IN GENERAL- In order to assist States in administering
              programs under State plans approved under this part and 
              programs funded under part A, and for the other purposes
              specified in this section, the Secretary shall, not later than
              October 1, 1997, establish and maintain in the Federal Parent
              Locator Service an automated directory to be known as the
              National Directory of New Hires, which shall contain the
              information supplied pursuant to section 453A(g)(2).
                `(2) ENTRY OF DATA- Information shall be entered into the 
              data base maintained by the National Directory of New Hires
              within 2 business days of receipt pursuant to section 453A(g)(2).
                `(3) ADMINISTRATION OF FEDERAL TAX LAWS- The Secretary of the
              Treasury shall have access to the information in the National
              Directory of New Hires for purposes of administering section 32
              of the Internal Revenue Code of 1986, or the advance payment of
              the earned income tax credit under section 3507 of such Code,
              and verifying a claim with respect to employment in a tax return.
                `(4) LIST OF MULTISTATE EMPLOYERS- The Secretary shall
              maintain within the National Directory of New Hires a list of
              multistate employers that report information regarding newly
              hired employees pursuant to section 453A(b)(1)(B), and the 
              State which each such employer has designated to receive such
              information.
            `(j) INFORMATION COMPARISONS AND OTHER DISCLOSURES- 
                `(1) VERIFICATION BY SOCIAL SECURITY ADMINISTRATION- 
                    `(A) IN GENERAL- The Secretary shall transmit information
                  on individuals and employers maintained under this section
                  to the Social Security Administration to the extent
                  necessary for verification in accordance with subparagraph
                  (B).
                    `(B) VERIFICATION BY SSA- The Social Security
                  Administration shall verify the accuracy of, correct, or
                  supply to the extent possible, and report to the Secretary,
                  the following information supplied by the Secretary 
                  pursuant to subparagraph (A):
                        `(i) The name, social security number, and birth date
                      of each such individual.
                        `(ii) The employer identification number of each such
                      employer.
                `(2) INFORMATION COMPARISONS- For the purpose of locating
              individuals in a paternity establishment case or a case
              involving the establishment, modification, or enforcement of a
              support order, the Secretary shall--
                    `(A) compare information in the National Directory of New
                  Hires against information in the support case abstracts in
                  the Federal Case Registry of Child Support Orders not less
                  often than every 2 business days; and
                    `(B) within 2 business days after such a comparison
                  reveals a match with respect to an individual, report the
                  information to the State agency responsible for the case.
                `(3) INFORMATION COMPARISONS AND DISCLOSURES OF INFORMATION 
              IN ALL REGISTRIES FOR TITLE IV PROGRAM PURPOSES- To the extent
              and with the frequency that the Secretary determines to be
              effective in assisting States to carry out their
              responsibilities under programs operated under this part and
              programs funded under part A, the Secretary shall--
                    `(A) compare the information in each component of the
                  Federal Parent Locator Service maintained under this 
                  section against the information in each other such 
                  component (other than the comparison required by paragraph
                  (2)), and report instances in which such a comparison
                  reveals a match with respect to an individual to State
                  agencies operating such programs; and
                    `(B) disclose information in such registries to such 
                  State agencies.
                `(4) PROVISION OF NEW HIRE INFORMATION TO THE SOCIAL SECURITY
              ADMINISTRATION- The National Directory of New Hires shall
              provide the Commissioner of Social Security with all 
              information in the National Directory.
                `(5) RESEARCH- The Secretary may provide access to 
              information reported by employers pursuant to section 453A(b)
              for research purposes found by the Secretary to be likely to
              contribute to achieving the purposes of part A or this part, 
              but without personal identifiers.
            `(k) FEES- 
                `(1) FOR SSA VERIFICATION- The Secretary shall reimburse the
              Commissioner of Social Security, at a rate negotiated between
              the Secretary and the Commissioner, for the costs incurred by
              the Commissioner in performing the verification services
              described in subsection (j).
                `(2) FOR INFORMATION FROM STATE DIRECTORIES OF NEW HIRES- The
              Secretary shall reimburse costs incurred by State directories 
              of new hires in furnishing information as required by 
              subsection (j)(3), at rates which the Secretary determines to 
              be reasonable (which rates shall not include payment for the
              costs of obtaining, compiling, or maintaining such information).
                `(3) FOR INFORMATION FURNISHED TO STATE AND FEDERAL AGENCIES-
              A State or Federal agency that receives information from the
              Secretary pursuant to this section shall reimburse the 
              Secretary for costs incurred by the Secretary in furnishing the
              information, at rates which the Secretary determines to be
              reasonable (which rates shall include payment for the costs of
              obtaining, verifying, maintaining, and comparing the
              information).
            `(l) RESTRICTION ON DISCLOSURE AND USE- Information in the 
          Federal Parent Locator Service, and information resulting from
          comparisons using such information, shall not be used or disclosed
          except as expressly provided in this section, subject to section
          6103 of the Internal Revenue Code of 1986.
            `(m) INFORMATION INTEGRITY AND SECURITY- The Secretary shall
          establish and implement safeguards with respect to the entities
          established under this section designed to--
                `(1) ensure the accuracy and completeness of information in
              the Federal Parent Locator Service; and
                `(2) restrict access to confidential information in the
              Federal Parent Locator Service to authorized persons, and
              restrict use of such information to authorized purposes.
            `(n) FEDERAL GOVERNMENT REPORTING- Each department, agency, and
          instrumentality of the United States shall on a quarterly basis
          report to the Federal Parent Locator Service the name and social
          security number of each employee and the wages paid to the employee
          during the previous quarter, except that such a  report shall not 
          be filed with respect to an employee of a department, agency, or
          instrumentality performing intelligence or counterintelligence
          functions, if the head of such department, agency, or
          instrumentality has determined that filing such a report could
          endanger the safety of the employee or compromise an ongoing
          investigation or intelligence mission.'.
            (g) CONFORMING AMENDMENTS- 
                (1) TO PART D OF TITLE IV OF THE SOCIAL SECURITY ACT- 
                    (A) Section 454(8)(B) (42 U.S.C. 654(8)(B)) is amended to
                  read as follows:
                    `(B) the Federal Parent Locator Service established under
                  section 453;'.
                    (B) Section 454(13) (42 U.S.C.654(13)) is amended by
                  inserting `and provide that information requests by parents
                  who are residents of other States be treated with the same
                  priority as requests by parents who are residents of the
                  State submitting the plan' before the semicolon.
                (2) TO FEDERAL UNEMPLOYMENT TAX ACT- Section 3304(a)(16) of
              the Internal Revenue Code of 1986 is amended--
                    (A) by striking `Secretary of Health, Education, and
                  Welfare' each place such term appears and inserting
                  `Secretary of Health and Human Services';
                    (B) in subparagraph (B), by striking `such information'
                  and all that follows and inserting `information furnished
                  under subparagraph (A) or (B) is used only for the purposes
                  authorized under such subparagraph;';
                    (C) by striking `and' at the end of subparagraph (A);
                    (D) by redesignating subparagraph (B) as subparagraph 
                  (C); and
                    (E) by inserting after subparagraph (A) the following new
                  subparagraph:
                `(B) wage and unemployment compensation information contained
              in the records of such agency shall be furnished to the
              Secretary of Health and Human Services (in accordance with
              regulations promulgated by such Secretary) as necessary for the
              purposes of the National Directory of New Hires established
              under section 453(i) of the Social Security Act, and'.
                (3) TO STATE GRANT PROGRAM UNDER TITLE III OF THE SOCIAL
              SECURITY ACT- Subsection (h) of section 303 (42 U.S.C. 503) is
              amended to read as follows:
            `(h)(1) The State agency charged with the administration of the
          State law shall, on a reimbursable basis--
                `(A) disclose quarterly, to the Secretary of Health and Human
              Services,  wage and claim information, as required pursuant to
              section 453(i)(1), contained in the records of such agency;
                `(B) ensure that information provided pursuant to 
              subparagraph (A) meets such standards relating to correctness
              and verification as the Secretary of Health and Human Services,
              with the concurrence of the Secretary of Labor, may find
              necessary; and
                `(C) establish such safeguards as the Secretary of Labor
              determines are necessary to insure that information disclosed
              under subparagraph (A) is used only for purposes of section
              453(i)(1) in carrying out the child support enforcement program
              under title IV.
            `(2) Whenever the Secretary of Labor, after reasonable notice and
          opportunity for hearing to the State agency charged with the
          administration of the State law, finds that there is a failure to
          comply substantially with the requirements of paragraph (1), the
          Secretary of Labor shall notify such State agency that further
          payments will not be made to the State until the Secretary of Labor
          is satisfied that there is no longer any such failure. Until the
          Secretary of Labor is so satisfied, the Secretary shall make no
          future certification to the Secretary of the Treasury with respect
          to the State.
            `(3) For purposes of this subsection--
                `(A) the term `wage information' means information regarding
              wages paid to an individual, the social security account number
              of such individual, and the name, address, State, and the
              Federal employer identification number of the employer paying
              such wages to such individual; and
                `(B) the term `claim information' means information regarding
              whether an individual is receiving, has received, or has made
              application for, unemployment compensation, the amount of any
              such compensation being received (or to be received by such
              individual), and the individual's current (or most recent) home
              address.'.
                (4) DISCLOSURE OF CERTAIN INFORMATION TO AGENTS OF CHILD
              SUPPORT ENFORCEMENT AGENCIES-
                    (A) IN GENERAL- Paragraph (6) of section 6103(l) of the
                  Internal Revenue Code of 1986 (relating to disclosure of
                  return information to Federal, State, and local child
                  support enforcement agencies) is amended by redesignating
                  subparagraph (B) as subparagraph (C) and by inserting after
                  subparagraph (A) the following new subparagraph:
                    `(B) DISCLOSURE TO CERTAIN AGENTS- The following
                  information disclosed to any child support enforcement
                  agency under subparagraph (A) with respect to any 
                  individual with respect to whom child support obligations
                  are sought to be established or enforced may be disclosed 
                  by such agency to any agent of such agency which is under
                  contract with such agency to carry out the purposes
                  described in subparagraph (C):
                        `(i) The address and social security account number
                      (or numbers) of such individual.
                        `(ii) The amount of any reduction under section
                      6402(c) (relating to offset of past-due support against
                      overpayments) in any overpayment otherwise payable to
                      such individual.'.
                    (B) CONFORMING AMENDMENTS- 
                        (i) Paragraph (3) of section 6103(a) of such Code is
                      amended by striking `(l)(12)' and inserting `paragraph
                      (6) or (12) of subsection (l)'.
                        (ii) Subparagraph (C) of section 6103(l)(6) of such
                      Code, as redesignated by subsection (a), is amended to
                      read as follows:
                    `(C) RESTRICTION ON DISCLOSURE- Information may be
                  disclosed under this paragraph only for purposes of, and to
                  the extent necessary in, establishing and collecting child
                  support obligations from, and locating, individuals owing
                  such obligations.'.
                        (iii) The material following subparagraph (F) of
                      section 6103(p)(4) of such Code is amended by striking
                      `subsection (l)(12)(B)' and inserting `paragraph (6)(A)
                      or (12)(B) of subsection (l)'.
            (h) REQUIREMENT FOR COOPERATION- The Secretary of Labor and the
          Secretary of Health and Human Services shall work jointly to 
          develop cost-effective and efficient methods of accessing the
          information in the various State directories of new hires and the
          National Directory of New Hires as established pursuant to the
          amendments made by this subtitle. In developing these methods the
          Secretaries shall take into account the impact, including costs, on
          the States, and shall also consider the need to insure the proper
          and authorized use of wage record information.
          SEC. 317. COLLECTION AND USE OF SOCIAL SECURITY NUMBERS FOR USE IN
                            CHILD SUPPORT ENFORCEMENT.
            Section 466(a) (42 U.S.C. 666(a)), as amended by section 315 of
          this Act, is amended by inserting after paragraph (12) the 
          following new paragraph:
                `(13) RECORDING OF SOCIAL SECURITY NUMBERS IN CERTAIN FAMILY
              MATTERS- Procedures requiring that the social security number
              of--
                    `(A) any applicant for a professional license, commercial
                  driver's license, occupational license, or marriage license
                  be recorded on the application;
                    `(B) any individual who is subject to a divorce decree,
                  support order, or paternity determination or acknowledgment
                  be placed in the records relating to the matter; and
                    `(C) any individual who has died be placed in the records
                  relating to the death and be recorded on the death
                  certificate.
              For purposes of subparagraph (A), if a State allows the use of 
              a number other than the social security number, the State shall
              so advise any applicants.'.
                  SUBTITLE C--STREAMLINING AND UNIFORMITY OF PROCEDURES
          SEC. 321. ADOPTION OF UNIFORM STATE LAWS.
            Section 466 (42 U.S.C. 666) is amended by adding at the end the
          following new subsection:
            `(f) UNIFORM INTERSTATE FAMILY SUPPORT ACT- In order to satisfy
          section 454(20)(A), on and after January 1, 1998, each State must
          have in effect the Uniform Interstate Family Support Act, as
          approved by the American Bar Association on February 9, 1993,
          together with any amendments officially adopted before January 1,
          1998 by the National Conference of Commissioners on Uniform State
          Laws.'.
          SEC. 322. IMPROVEMENTS TO FULL FAITH AND CREDIT FOR CHILD SUPPORT
                            ORDERS.
            Section 1738B of title 28, United States Code, is amended--
                (1) in subsection (a)(2), by striking `subsection (e)' and
              inserting `subsections (e), (f), and (i)';
                (2) in subsection (b), by inserting after the 2nd 
              undesignated paragraph the following:
            `child's home State' means the State in which a child lived with 
          a parent or a person acting as parent for at least 6 consecutive
          months immediately preceding the time of filing of a petition or
          comparable pleading for support and, if a child is less than 6
          months old, the State in which the child lived from birth with any
          of them. A period of temporary absence of any of them is counted as
          part of the 6-month period.';
                (3) in subsection (c), by inserting `by a court of a State'
              before `is made';
                (4) in subsection (c)(1), by inserting `and subsections (e),
              (f), and (g)' after `located';
                (5) in subsection (d)--
                    (A) by inserting `individual' before `contestant'; and
                    (B) by striking `subsection (e)' and inserting
                  `subsections (e) and (f)';
                (6) in subsection (e), by striking `make a modification of a
              child support order with respect to a child that is made' and
              inserting `modify a child support order issued';
                (7) in subsection (e)(1), by inserting `pursuant to 
              subsection (i)' before the semicolon;
                (8) in subsection (e)(2)--
                    (A) by inserting `individual' before `contestant' each
                  place such term appears; and
                    (B) by striking `to that court's making the modification
                  and assuming' and inserting `with the State of continuing,
                  exclusive jurisdiction for a court of another State to
                  modify the order and assume';
                (9) by redesignating subsections (f) and (g) as subsections
              (g) and (h), respectively;
                (10) by inserting after subsection (e) the following new
              subsection:
            `(f) RECOGNITION OF CHILD SUPPORT ORDERS- If 1 or more child
          support orders have been issued with regard to an obligor and a
          child, a court shall apply the following rules in determining which
          order to recognize for purposes of continuing, exclusive
          jurisdiction and enforcement:
                `(1) If only 1 court has issued a child support order, the
              order of that court must be recognized.
                `(2) If 2 or more courts have issued child support orders for
              the same obligor and child, and only 1 of the courts would have
              continuing, exclusive jurisdiction under this section, the 
              order of that court must be recognized.
                `(3) If 2 or more courts have issued child support orders for
              the same obligor and child, and more than 1 of the courts would
              have continuing, exclusive jurisdiction under this section, an
              order issued by a court in the current home State of the child
              must be recognized, but if an order has not been issued in the
              current home State of the child, the order most recently issued
              must be recognized.
                `(4) If 2 or more courts have issued child support orders for
              the same obligor and child, and none of the courts would have
              continuing, exclusive jurisdiction under this section, a court
              may issue a child support order, which must be recognized.
                `(5) The court that has issued an order recognized under this
              subsection is the court having continuing, exclusive
              jurisdiction.';
                (11) in subsection (g) (as so redesignated)--
                    (A) by striking `PRIOR' and inserting `MODIFIED'; and
                    (B) by striking `subsection (e)' and inserting
                  `subsections (e) and (f)';
                (12) in subsection (h) (as so redesignated)--
                    (A) in paragraph (2), by inserting `including the 
                  duration of current payments and other obligations of
                  support' before the comma; and
                    (B) in paragraph (3), by inserting `arrears under' after
                  `enforce'; and
                (13) by adding at the end the following new subsection:
            `(i) REGISTRATION FOR MODIFICATION- If there is no individual
          contestant or child residing in the issuing State, the party or
          support enforcement agency seeking to modify, or to modify and
          enforce, a child support order issued in another State shall
          register that order in a State with jurisdiction over the nonmovant
          for the purpose of modification.'.
          SEC. 323. ADMINISTRATIVE ENFORCEMENT IN INTERSTATE CASES.
            Section 466(a) (42 U.S.C. 666(a)), as amended by sections 315 and
          317 of this Act, is amended by inserting after paragraph (13) the
          following new paragraph:
                `(14) ADMINISTRATIVE ENFORCEMENT IN INTERSTATE CASES-
              Procedures under which--
                    `(A)(i) the State shall respond within 5 business days to
                  a request made by another State to enforce a support order;
                  and
                    `(ii) the term `business day' means a day on which State
                  offices are open for regular business;
                    `(B) the State may, by electronic or other means, 
                  transmit to another State a request for assistance in a 
                  case involving the enforcement of a support order, which
                  request--
                        `(i) shall include such information as will enable 
                      the State to which the request is transmitted to 
                      compare the information about the case to the
                      information in the data bases of the State; and
                        `(ii) shall constitute a certification by the
                      re-questing State--
            `(I) of the amount of support under the order the payment of 
          which is in arrears; and
            `(II) that the requesting State has complied with all procedural
          due process requirements applicable to the case;
                    `(C) if the State provides assistance to another State
                  pursuant to this paragraph with respect to a case, neither
                  State shall consider the case to be transferred to the
                  caseload of such other State; and
                    `(D) the State shall maintain records of--
                        `(i) the number of such requests for assistance
                      received by the State;
                        `(ii) the number of cases for which the State
                      collected support in response to such a request; and
                        `(iii) the amount of such collected support.'.
          SEC. 324. USE OF FORMS IN INTERSTATE ENFORCEMENT.
            (a) PROMULGATION- Section 452(a) (42 U.S.C. 652(a)) is amended--
                (1) by striking `and' at the end of paragraph (9);
                (2) by striking the period at the end of paragraph (10) (as
              amended by section 346(a) of this Act) and inserting `; and'; and
                (3) by adding at the end the following new paragraph:
                `(11) not later than October 1, 1996, after consulting with
              the State directors of programs under this part, promulgate
              forms to be used by States in interstate cases for--
                    `(A) collection of child support through income
                  withholding;
                    `(B) imposition of liens; and
                    `(C) administrative subpoenas.'.
            (b) USE BY STATES- Section 454(9) (42 U.S.C. 654(9)) is amended--
                (1) by striking `and' at the end of subparagraph (C);
                (2) by inserting `and' at the end of subparagraph (D); and
                (3) by adding at the end the following new subparagraph:
                    `(E) not later than March 1, 1997, in using the forms
                  promulgated pursuant to section 452(a)(11) for income
                  withholding, imposition of liens, and issuance of
                  administrative subpoenas in interstate child support cases;'.
          SEC. 325. STATE LAWS PROVIDING EXPEDITED PROCEDURES.
            (a) STATE LAW REQUIREMENTS- Section 466 (42 U.S.C. 666), as
          amended by section 314 of this Act, is amended--
                (1) in subsection (a)(2), by striking the first sentence and
              inserting the following: `Expedited administrative and judicial
              procedures (including the procedures specified in subsection
              (c)) for establishing paternity and for establishing, 
              modifying, and enforcing support obligations.'; and
                (2) by inserting after subsection (b) the following new
              subsection:
            `(c) EXPEDITED PROCEDURES- The procedures specified in this
          subsection are the following:
                `(1) ADMINISTRATIVE ACTION BY STATE AGENCY- Procedures which
              give the State agency the authority to take the following
              actions relating to establishment of paternity or to
              establishment, modification, or enforcement of support orders,
              without the necessity of obtaining an order from any other
              judicial or administrative tribunal, and to recognize and
              enforce the authority of State agencies of other States to take
              the following actions:
                    `(A) GENETIC TESTING- To order genetic testing for the
                  purpose of paternity establishment as provided in section
                  466(a)(5).
                    `(B) FINANCIAL OR OTHER INFORMATION- To subpoena any
                  financial or other information needed to establish, modify,
                  or enforce a support order, and to impose penalties for
                  failure to respond to such a subpoena.
                    `(C) RESPONSE TO STATE AGENCY REQUEST- To require all
                  entities in the State (including for-profit, nonprofit, and
                  governmental employers) to provide promptly, in response to
                  a request by the State agency of that or any other State
                  administering a program under this part, information on the
                  employment, compensation, and benefits of any individual
                  employed by such entity as an employee or contractor, and 
                  to sanction failure to respond to any such request.
                    `(D) ACCESS TO INFORMATION CONTAINED IN CERTAIN RECORDS-
                  To obtain access, subject to safeguards on privacy and
                  information security, and subject to the nonliability of
                  entities that afford such access under this subparagraph, 
                  to information contained in the following records 
                  (including automated access, in the case of records
                  maintained in automated data bases):
                        `(i) Records of other State and local government
                      agencies, including--
            `(I) vital statistics (including records of marriage, birth, and
          divorce);
            `(II) State and local tax and revenue records (including
          information on residence address, employer, income and assets);
            `(III) records concerning real and titled personal property;
            `(IV) records of occupational and professional licenses, and
          records concerning the ownership and control of corporations,
          partnerships, and other business entities;
            `(V) employment security records;
            `(VI) records of agencies administering public assistance programs;
            `(VII) records of the motor vehicle depart-ment; and
            `(VIII) corrections records.
                        `(ii) Certain records held by private entities with
                      respect to individuals who owe or are owed support (or
                      against or with respect to whom a support obligation is
                      sought), consisting of--
            `(I) the names and addresses of such indi-viduals and the names
          and addresses of the employers of such individuals, as appearing in
          customer records of public utilities and cable television 
          companies, pursuant to an administrative subpoena authorized by
          subparagraph (B); and
            `(II) information (including information on assets and
          liabilities) on such individuals held by financial institutions.
                    `(E) CHANGE IN PAYEE- In cases in which support is 
                  subject to an assignment in order to comply with a
                  requirement imposed pursuant to part A or section 1912, or
                  to a requirement to pay through the State disbursement unit
                  established pursuant to section 454B, upon providing notice
                  to obligor and obligee, to direct the obligor or other 
                  payor to change the payee to the appropriate government
                  entity.
                    `(F) INCOME WITHHOLDING- To order income withholding in
                  accordance with subsections (a)(1)(A) and (b) of section 466.
                    `(G) SECURING ASSETS- In cases in which there is a 
                  support arrearage, to secure assets to satisfy the 
                  arrearage by--
                        `(i) intercepting or seizing periodic or lump-sum
                      payments from--
            `(I) a State or local agency, including unemployment 
          compensation, workers' compensation, and other benefits; and
            `(II) judgments, settlements, and lotteries;
                        `(ii) attaching and seizing assets of the obligor 
                      held in financial institutions;
                        `(iii) attaching public and private retirement funds;
                      and
                        `(iv) imposing liens in accordance with subsection
                      (a)(4) and, in appropriate cases, to force sale of
                      property and distribution of proceeds.
                    `(H) INCREASE MONTHLY PAYMENTS- For the purpose of
                  securing overdue support, to increase the amount of monthly
                  support payments to include amounts for arrearages, subject
                  to such conditions or limitations as the State may provide.
              Such procedures shall be subject to due process safeguards,
              including (as appropriate) requirements for notice, opportunity
              to contest the action, and opportunity for an appeal on the
              record to an independent administrative or judicial tribunal.
                `(2) SUBSTANTIVE AND PROCEDURAL RULES- The expedited
              procedures required under subsection (a)(2) shall include the
              following rules and authority, applicable with respect to all
              proceedings to establish paternity or to establish, modify, or
              enforce support orders:
                    `(A) LOCATOR INFORMATION; PRESUMPTIONS CON-CERNING 
                  NOTICE- Procedures under which--
                        `(i) each party to any paternity or child support
                      proceeding is required (subject to privacy safeguards)
                      to file with the tribunal and the State case registry
                      upon entry of an order, and to update as appropriate,
                      information on location and identity of the party,
                      including Social Security number, residential and
                      mailing addresses, telephone number, driver's license
                      number, and name, address, and telephone number of
                      employer; and
                        `(ii) in any subsequent child support enforcement
                      action between the parties, upon sufficient showing 
                      that diligent effort has been made to ascertain the
                      location of such a party, the tribunal may deem State
                      due process requirements for notice and service of
                      process to be met with respect to the party, upon
                      delivery of written notice to the most recent
                      residential or employer address filed with the tribunal
                      pursuant to clause (i).
                    `(B) STATEWIDE JURISDICTION- Procedures under which--
                        `(i) the State agency and any administrative or
                      judicial tribunal with authority to hear child support
                      and paternity cases exerts statewide jurisdiction over
                      the parties; and
                        `(ii) in a State in which orders are issued by courts
                      or administrative tribunals, a case may be transferred
                      between local jurisdictions in the State without need
                      for any additional filing by the petitioner, or service
                      of process upon the respondent, to retain jurisdiction
                      over the parties.
                `(3) COORDINATION WITH ERISA- Notwithstanding subsection (d)
              of section 514 of the Employee Retirement Income Security Act 
              of 1974 (relating to effect on other laws), nothing in this
              subsection shall be construed to alter, amend, modify,
              invalidate, impair, or supersede subsections (a), (b), and (c)
              of such section 514 as it applies with respect to any procedure
              referred to in paragraph (1) and any expedited procedure
              referred to in paragraph (2), except to the extent that such
              procedure would be consistent with the requirements of section
              206(d)(3) of such Act (relating to qualified domestic relations
              orders) or the requirements of section 609(a) of such Act
              (relating to qualified medical child support orders) if the
              reference in such section 206(d)(3) to a domestic relations
              order and the reference in such section 609(a) to a medical
              child support order were a reference to a support order 
              referred to in paragraphs (1) and (2) relating to the same
              matters, respectively.'.
            (b) AUTOMATION OF STATE AGENCY FUNCTIONS- Section 454A, as added
          by section 344(a)(2) and as amended by sections 311 and 312(c) of
          this Act, is amended by adding at the end the following new
          subsection:
            `(h) EXPEDITED ADMINISTRATIVE PROCEDURES- The automated system
          required by this section shall be used, to the maximum extent
          feasible, to implement the expedited administrative procedures
          required by section 466(c).'.
                           SUBTITLE D--PATERNITY ESTABLISHMENT
          SEC. 331. STATE LAWS CONCERNING PATERNITY ESTABLISHMENT.
            (a) STATE LAWS REQUIRED- Section 466(a)(5) (42 U.S.C. 666(a)(5))
          is amended to read as follows:
                `(5) PROCEDURES CONCERNING PATERNITY ESTAB-LISHMENT- 
                    `(A) ESTABLISHMENT PROCESS AVAILABLE FROM BIRTH UNTIL AGE
                  18-
                        `(i) Procedures which permit the establishment of the
                      paternity of a child at any time before the child
                      attains 18 years of age.
                        `(ii) As of August 16, 1984, clause (i) shall also
                      apply to a child for whom paternity has not been
                      established or for whom a paternity action was brought
                      but dismissed because a statute of limitations of less
                      than 18 years was then in effect in the State.
                    `(B) PROCEDURES CONCERNING GENETIC TESTING- 
                        `(i) GENETIC TESTING REQUIRED IN CERTAIN CONTESTED
                      CASES- Procedures under which the State is required, in
                      a contested paternity case (unless otherwise barred by
                      State law) to require the child and all other parties
                      (other than individuals found under section 454(29) to
                      have good cause and other exceptions for refusing to
                      cooperate) to submit to genetic tests upon the request
                      of any such party, if the request is supported by a
                      sworn statement by the party--
            `(I) alleging paternity, and setting forth facts establishing a
          reasonable possibility of the requisite sexual contact between the
          parties; or
            `(II) denying paternity, and setting forth facts establishing a
          reasonable possibility of the nonexistence of sexual contact 
          between the parties.
                        `(ii) OTHER REQUIREMENTS- Procedures which require 
                      the State agency, in any case in which the agency 
                      orders genetic testing--
            `(I) to pay costs of such tests, subject to recoupment (if the
          State so elects) from the alleged father if paternity is
          established; and
            `(II) to obtain additional testing in any case if an original 
          test result is contested, upon request and advance payment by the
          contestant.
                    `(C) VOLUNTARY PATERNITY ACKNOWLEDGMENT- 
                        `(i) SIMPLE CIVIL PROCESS- Procedures for a simple
                      civil process for voluntarily acknowledging paternity
                      under which the State must provide that, before a 
                      mother and a putative father can sign an acknowledgment
                      of paternity, the mother and the putative father must 
                      be given notice, orally and in writing, of the
                      alternatives to, the legal consequences of, and the
                      rights (including, if 1 parent is a minor, any rights
                      afforded due to minority status) and responsibilities
                      that arise from, signing the acknowledgment.
                        `(ii) HOSPITAL-BASED PROGRAM- Such procedures must
                      include a hospital-based program for the voluntary
                      acknowledgment of paternity focusing on the period
                      immediately before or after the birth of a child.
                        `(iii) PATERNITY ESTABLISHMENT SERVICES- 
            `(I) STATE-OFFERED SERVICES- Such procedures must require the
          State agency responsible for maintaining birth records to offer
          voluntary paternity establishment services.
            `(II) REGULATIONS- 
            `(aa) SERVICES OFFERED BY HOSPITALS AND BIRTH RECORD AGENCIES- 
          The Secretary shall prescribe regulations governing voluntary
          paternity establishment services offered by hospitals and birth
          record agencies.
            `(bb) SERVICES OFFERED BY OTHER ENTITIES- The Secretary shall
          prescribe regulations specifying the types of other entities that
          may offer voluntary paternity establishment services, and governing
          the provision of such services, which shall include a requirement
          that such an entity must use the same notice provisions used by, 
          use the same materials used by, provide the personnel providing 
          such services with the same training provided by, and evaluate the
          provision of such services in the same manner as the provision of
          such services is evaluated by, voluntary paternity establishment
          programs of hospitals and birth record agencies.
                        `(iv) USE OF PATERNITY ACKNOWLEDGMENT AFFIDAVIT- Such
                      procedures must require the State to develop and use an
                      affidavit for the voluntary acknowledgment of paternity
                      which includes the minimum requirements of the 
                      affidavit specified by the Secretary under section
                      452(a)(7) for the voluntary acknowledgment of 
                      paternity, and to give full faith and credit to such an
                      affidavit signed in any other State according to its
                      procedures.
                    `(D) STATUS OF SIGNED PATERNITY ACKNOW-LEDGMENT- 
                        `(i) INCLUSION IN BIRTH RECORDS- Procedures under
                      which the name of the father shall be included on the
                      record of birth of the child of unmarried parents only
                      if--
            `(I) the father and mother have signed a voluntary acknowledgment
          of paternity; or
            `(II) a court or an administrative agency of competent
          jurisdiction has issued an adjudication of paternity.
                      Nothing in this clause shall preclude a State agency
                      from obtaining an admission of paternity from the 
                      father for submission in a judicial or administrative
                      proceeding, or prohibit the issuance of an order in a
                      judicial or administrative proceeding which bases a
                      legal finding of paternity on an admission of paternity
                      by the father and any other additional showing required
                      by State law.
                        `(ii) LEGAL FINDING OF PATERNITY- Procedures under
                      which a signed voluntary acknowledgment of paternity is
                      considered a legal finding of paternity, subject to the
                      right of any signatory to rescind the acknowledgment
                      within the earlier of--
            `(I) 60 days; or
            `(II) the date of an administrative or judicial proceeding
          relating to the child (including a proceeding to establish a 
          support order) in which the signatory is a party.
                        `(iii) CONTEST- Procedures under which, after the
                      60-day period referred to in clause (ii), a signed
                      voluntary acknowledgment of paternity may be challenged
                      in court only on the basis of fraud, duress, or 
                      material mistake of fact, with the burden of proof upon
                      the challenger, and under which the legal
                      responsibilities (including child support obligations)
                      of any signatory arising from the acknowledgment may 
                      not be suspended during the challenge, except for good
                      cause shown.
                    `(E) BAR ON ACKNOWLEDGMENT RATIFICATION PRO-CEEDINGS-
                  Procedures under which judicial or administrative
                  proceedings are not required or permitted to ratify an
                  unchallenged acknowledgment of paternity.
                    `(F) ADMISSIBILITY OF GENETIC TESTING RESULTS- Procedures--
                        `(i) requiring the admission into evidence, for
                      purposes of establishing paternity, of the results of
                      any genetic test that is--
            `(I) of a type generally acknowledged as reliable by 
          accreditation bodies designated by the Secretary; and
            `(II) performed by a laboratory approved by such an accreditation
          body;
                        `(ii) requiring an objection to genetic testing
                      results to be made in writing not later than a 
                      specified number of days before any hearing at which 
                      the results may be introduced into evidence (or, at
                      State option, not later than a specified number of days
                      after receipt of the results); and
                        `(iii) making the test results admissible as evidence
                      of paternity without the need for foundation testimony
                      or other proof of authenticity or accuracy, unless
                      objection is made.
                    `(G) PRESUMPTION OF PATERNITY IN CERTAIN CASES- 
                  Procedures which create a rebuttable or, at the option of
                  the State, conclusive presumption of paternity upon genetic
                  testing results indicating a threshold probability that the
                  alleged father is the father of the child.
                    `(H) DEFAULT ORDERS- Procedures requiring a default order
                  to be entered in a paternity case upon a showing of service
                  of process on the defendant and any additional showing
                  required by State law.
                    `(I) NO RIGHT TO JURY TRIAL- Procedures providing that 
                  the parties to an action to establish paternity are not
                  entitled to a trial by jury.
                    `(J) TEMPORARY SUPPORT ORDER BASED ON PROBABLE PATERNITY
                  IN CONTESTED CASES- Procedures which require that a
                  temporary order be issued, upon motion by a party, 
                  requiring the provision of child support pending an
                  administrative or judicial determination of parentage, if
                  there is clear and convincing evidence of paternity (on the
                  basis of genetic tests or other evidence).
                    `(K) PROOF OF CERTAIN SUPPORT AND PATERNITY ESTABLISHMENT
                  COSTS- Procedures under which bills for pregnancy,
                  childbirth, and genetic testing are admissible as evidence
                  without requiring third-party foundation testimony, and
                  shall constitute prima facie evidence of amounts incurred
                  for such services or for testing on behalf of the child.
                    `(L) STANDING OF PUTATIVE FATHERS- Procedures ensuring
                  that the putative father has a reasonable opportunity to
                  initiate a paternity action.
                    `(M) FILING OF ACKNOWLEDGMENTS AND ADJUDICATIONS IN STATE
                  REGISTRY OF BIRTH RECORDS- Procedures under which voluntary
                  acknowledgments and adjudications of paternity by judicial
                  or administrative processes are filed with the State
                  registry of birth records for comparison with information 
                  in the State case registry.'.
            (b) NATIONAL PATERNITY ACKNOWLEDGMENT AFFIDAVIT- Section 
          452(a)(7) (42 U.S.C. 652(a)(7)) is amended by inserting `, and
          specify the minimum requirements of an affidavit to be used for the
          voluntary acknowledgment of paternity which shall include the 
          Social Security number of each parent and, after consultation with
          the States, other common elements as determined by such designee'
          before the semicolon.
            (c) CONFORMING AMENDMENT- Section 468 (42 U.S.C. 668) is amended
          by striking `a simple civil process for voluntarily acknowledging
          paternity and'.
          SEC. 332. OUTREACH FOR VOLUNTARY PATERNITY ESTABLISHMENT.
            Section 454(23) (42 U.S.C. 654(23)) is amended by inserting `and
          will publicize the availability and encourage the use of procedures
          for voluntary establishment of paternity and child support by means
          the State deems appropriate' before the semicolon.
          SEC. 333. COOPERATION BY APPLICANTS FOR AND RECIPIENTS OF PART A
                            ASSISTANCE.
            Section 454 (42 U.S.C. 654), as amended by sections 301(b),
          303(a), 312(a), and 313(a) of this Act, is amended--
                (1) by striking `and' at the end of paragraph (27);
                (2) by striking the period at the end of paragraph (28) and
              inserting `; and'; and
                (3) by inserting after paragraph (28) the following new
              paragraph:
                `(29) provide that the State agency responsible for
              administering the State plan--
                    `(A) shall make the determination (and redetermination at
                  appropriate intervals) as to whether an individual who has
                  applied for or is receiving assistance under the State
                  program funded under part A of this title or the State
                  program under title XIX is cooperating in good faith with
                  the State in establishing the paternity of, or in
                  establishing, modifying, or enforcing a support order for,
                  any child of the individual by providing the State agency
                  with the name of, and such other information as the State
                  agency may require with respect to, the noncustodial parent
                  of the child, subject to good cause and other exceptions
                  which--
                        `(i) shall be defined, taking into account the best
                      interests of the child, and
                        `(ii) shall be applied in each case,
                  by, at the option of the State, the State agency
                  administering the State program under part A, this part, or
                  title XIX;
                    `(B) shall require the individual to supply additional
                  necessary information and appear at interviews, hearings,
                  and legal proceedings;
                    `(C) shall require the individual and the child to submit
                  to genetic tests pursuant to judicial or administrative
                  order;
                    `(D) may request that the individual sign a voluntary
                  acknowledgment of paternity, after notice of the rights and
                  consequences of such an acknowledgment, but may not require
                  the individual to sign an acknowledgment or otherwise
                  relinquish the right to genetic tests as a condition of
                  cooperation and eligibility for assistance under the State
                  program funded under part A, or the State program under
                  title XIX; and
                    `(E) shall promptly notify the individual, the State
                  agency administering the State program funded under part A,
                  and the State agency administering the State program under
                  title XIX, of each such determination, and if 
                  noncooperation is determined, the basis therefor.'.
                     SUBTITLE E--PROGRAM ADMINISTRATION AND FUNDING
          SEC. 341. PERFORMANCE-BASED INCENTIVES AND PENALTIES.
            (a) DEVELOPMENT OF NEW SYSTEM- The Secretary of Health and Human
          Services, in consultation with State directors of programs under
          part D of title IV of the Social Security Act, shall develop a new
          incentive system to replace, in a revenue neutral manner, the 
          system under section 458 of such Act. The new system shall provide
          additional payments to any State based on such State's performance
          under such a program. Not later than March 1, 1997, the Secretary
          shall report on the new system to the Committee on Ways and Means 
          of the House of Representatives and the Committee on Finance of the
          Senate.
            (b) CONFORMING AMENDMENTS TO PRESENT SYSTEM- Section 458 (42
          U.S.C. 658) is amended--
                (1) in subsection (a), by striking `aid to families with
              dependent children under a State plan approved under part A of
              this title' and inserting `assistance under a program funded
              under part A';
                (2) in subsection (b)(1)(A), by striking `section 402(a)(26)'
              and inserting `section 408(a)(4)';
                (3) in subsections (b) and (c)--
                    (A) by striking `AFDC collections' each place it appears
                  and inserting `title IV-A collections', and
                    (B) by striking `non-AFDC collections' each place it
                  appears and inserting `non-title IV-A collections'; and
                (4) in subsection (c), by striking `combined AFDC/non-AFDC
              administrative costs' both places it appears and inserting
              `combined title IV-A/non-title IV-A administrative costs'.
            (c) CALCULATION OF PATERNITY ESTABLISHMENT PERCENTAGE- 
                (1) Section 452(g)(1)(A)  (42 U.S.C. 652(g)(1)(A)) is amended
              by striking `75' and inserting `90'.
                (2) Section 452(g)(1) (42 U.S.C. 652(g)(1)) is amended--
                    (A) by redesignating subparagraphs (B) through (E) as
                  subparagraphs (C) through (F), respectively, and by
                  inserting after subparagraph (A) the following new
                  subparagraph:
                `(B) for a State with a paternity establishment percentage of
              not less than 75 percent but less than 90 percent for such
              fiscal year, the paternity establishment percentage of the 
              State for the immediately preceding fiscal year plus 2
              percentage points;'; and
                    (B) by adding at the end the following new flush sentence:
          `In determining compliance under this section, a State may use as
          its paternity establishment percentage either the State's IV-D
          paternity establishment percentage (as defined in paragraph (2)(A))
          or the State's statewide paternity establishment percentage (as
          defined in paragraph (2)(B)).'.
                (3) Section 452(g)(2) (42 U.S.C. 652(g)(2)) is amended--
                    (A) in subparagraph (A)--
                        (i) in the matter preceding clause (i)--
            (I) by striking `paternity establishment percentage' and 
          inserting `IV-D paternity establishment percentage'; and
            (II) by striking `(or all States, as the case may be)'; and
                        (ii) by striking `and' at the end; and
                    (B) by redesignating subparagraph (B) as subparagraph (C)
                  and by inserting after subparagraph (A) the following new
                  subparagraph:
                `(B) the term `statewide paternity establishment  percentage'
              means, with respect to a State for a fiscal year, the ratio
              (expressed as a percentage) that the total number of minor
              children--
                    `(i) who have been born out of wedlock, and
                    `(ii) the paternity of whom has been established or
                  acknowledged during the fiscal year,
              bears to the total number of children born out of wedlock 
              during the preceding fiscal year; and'.
                (4) Section 452(g)(3) (42 U.S.C. 652(g)(3)) is amended--
                    (A) by striking subparagraph (A) and redesignating
                  subparagraphs (B) and (C) as subparagraphs (A) and (B),
                  respectively; and
                    (B) in subparagraph (A) (as so redesignated), by striking
                  `the percentage of children born out-of-wedlock in a State'
                  and inserting `the percentage of children in a State who 
                  are born out of wedlock or for whom support has not been
                  established'.
            (d) EFFECTIVE DATES- 
                (1) INCENTIVE ADJUSTMENTS- 
                    (A) IN GENERAL- The system developed under subsection (a)
                  and the amendments made by subsection (b) shall become
                  effective on October 1, 1999, except to the extent provided
                  in subparagraph (B).
                    (B) APPLICATION OF SECTION 458- Section 458 of the Social
                  Security Act, as in effect on the day before the date of 
                  the enactment of this section, shall be effective for
                  purposes of incentive payments to States for fiscal years
                  before fiscal year 2000.
                (2) PENALTY REDUCTIONS- The amendments made by subsection (c)
              shall become effective with respect to calendar quarters
              beginning on or after the date of the enactment of this Act.
          SEC. 342. FEDERAL AND STATE REVIEWS AND AUDITS.
            (a) STATE AGENCY ACTIVITIES- Section 454 (42 U.S.C. 654) is
          amended--
                (1) in paragraph (14), by striking `(14)' and inserting
              `(14)(A)';
                (2) by redesignating paragraph (15) as subparagraph (B) of
              paragraph (14); and
                (3) by inserting after paragraph (14) the following new
              paragraph:
                `(15) provide for--
                    `(A) a process for annual reviews of and reports to the
                  Secretary on the State program operated under the State 
                  plan approved under this part, including such information 
                  as may be necessary to measure State compliance with 
                  Federal requirements for expedited procedures, using such
                  standards and procedures as are required by the Secretary,
                  under which the State agency will determine the extent to
                  which the program is operated in compliance with this part;
                  and
                    `(B) a process of extracting from the automated data
                  processing system required by paragraph (16) and
                  transmitting to the Secretary data and calculations
                  concerning the levels of accomplishment (and rates of
                  improvement) with respect to applicable performance
                  indicators (including paternity establishment percentages)
                  to the extent necessary for purposes of sections 452(g) and
                  458;'.
            (b) FEDERAL ACTIVITIES- Section 452(a)(4) (42 U.S.C. 652(a)(4)) 
          is amended to read as follows:
                `(4)(A) review data and calculations transmitted by State
              agencies pursuant to section 454(15)(B) on State program
              accomplishments with respect to performance indicators for
              purposes of subsection (g) of this section and section 458;
                `(B) review annual reports submitted pursuant to section
              454(15)(A) and, as appropriate, provide to the State comments,
              recommendations for additional or alternative corrective
              actions, and technical assistance; and
                `(C) conduct audits, in accordance with the Government
              auditing standards of the Comptroller General of the United
              States--
                    `(i) at least once every 3 years (or more frequently, in
                  the case of a State which fails to meet the requirements of
                  this part concerning performance standards and reliability
                  of program data) to assess the completeness, reliability,
                  and security of the data and the accuracy of the reporting
                  systems used in calculating performance indicators under
                  subsection (g) of this section and section 458;
                    `(ii) of the adequacy of financial management of the 
                  State program operated under the State plan approved under
                  this part, including assessments of--
                        `(I) whether Federal and other funds made available 
                      to carry out the State program are being appropriately
                      expended, and are properly and fully accounted for; and
                        `(II) whether collections and disbursements of 
                      support payments are carried out correctly and are 
                      fully accounted for; and
                    `(iii) for such other purposes as the Secretary may find
                  necessary;'.
            (c) EFFECTIVE DATE- The amendments made by this section shall be
          effective with respect to calendar quarters beginning 12 months or
          more after the date of the enactment of this Act.
          SEC. 343. REQUIRED REPORTING PROCEDURES.
            (a) ESTABLISHMENT- Section 452(a)(5) (42 U.S.C. 652(a)(5)) is
          amended by inserting `, and establish procedures to be followed by
          States for collecting and reporting information required to be
          provided under this part, and establish uniform definitions
          (including those necessary to enable the measurement of State
          compliance with the requirements of this part relating to expedited
          processes) to be applied in following such procedures' before the
          semicolon.
            (b) STATE PLAN REQUIREMENT- Section 454 (42 U.S.C. 654), as
          amended by sections 301(b), 303(a), 312(a), 313(a), and 333 of this
          Act, is amended--
                (1) by striking `and' at the end of paragraph (28);
                (2) by striking the period at the end of paragraph (29) and
              inserting `; and'; and
                (3) by adding after paragraph (29) the following new paragraph:
                `(30) provide that the State shall use the definitions
              established under section 452(a)(5) in collecting and reporting
              information as required under this part.'.
          SEC. 344. AUTOMATED DATA PROCESSING REQUIREMENTS.
            (a) REVISED REQUIREMENTS- 
                (1) IN GENERAL- Section 454(16) (42 U.S.C. 654(16)) is
              amended--
                    (A) by striking `, at the option of the State,';
                    (B) by inserting `and operation by the State agency' 
                  after `for the establishment';
                    (C) by inserting `meeting the requirements of section
                  454A' after `information retrieval system';
                    (D) by striking `in the State and localities thereof, so
                  as (A)' and inserting `so as';
                    (E) by striking `(i)'; and
                    (F) by striking `(including' and all that follows and
                  inserting a semicolon.
                (2) AUTOMATED DATA PROCESSING- Part D of title IV (42 U.S.C.
              651-669) is amended by inserting after section 454 the 
              following new section:
          `SEC. 454A. AUTOMATED DATA PROCESSING.
            `(a) IN GENERAL- In order for a State to meet the requirements of
          this section, the State agency administering the State program 
          under this part shall have in operation a single statewide 
          automated data processing and information retrieval system which 
          has the capability to perform the tasks specified in this section
          with the frequency and in the manner required by or under this part.
            `(b) PROGRAM MANAGEMENT- The automated system required by this
          section shall perform such functions as the Secretary may specify
          relating to management of the State program under this part,
          including--
                `(1) controlling and accounting for use of Federal, State, 
              and local funds in carrying out the program; and
                `(2) maintaining the data necessary to meet Federal reporting
              requirements under this part on a timely basis.
            `(c) CALCULATION OF PERFORMANCE INDICATORS- In order to enable 
          the Secretary to determine the incentive payments and penalty
          adjustments required by sections 452(g) and 458, the State agency
          shall--
                `(1) use the automated system--
                    `(A) to maintain the requisite data on State performance
                  with respect to paternity establishment and child support
                  enforcement in the State; and
                    `(B) to calculate the paternity establishment percentage
                  for the State for each fiscal year; and
                `(2) have in place systems controls to ensure the
              com-pleteness and reliability of, and ready access to, the data
              described in paragraph (1)(A), and the accuracy of the
              calculations described in paragraph (1)(B).
            `(d) INFORMATION INTEGRITY AND SECURITY- The State agency shall
          have in effect safeguards on the integrity, accuracy, and
          completeness of, access to, and use of data in the automated system
          required by this section, which shall include the following (in
          addition to such other safeguards as the Secretary may specify in
          regulations):
                `(1) POLICIES RESTRICTING ACCESS- Written policies concerning
              access to data by State agency personnel, and sharing of data
              with other persons, which--
                    `(A) permit access to and use of data only to the extent
                  necessary to carry out the State program under this part; and
                    `(B) specify the data which may be used for particular
                  program purposes, and the personnel permitted access to 
                  such data.
                `(2) SYSTEMS CONTROLS- Systems controls (such as passwords or
              blocking of fields) to ensure strict adherence to the policies
              described in paragraph (1).
                `(3) MONITORING OF ACCESS- Routine monitoring of access to 
              and use of the automated system, through methods such as audit
              trails and feedback mechanisms, to guard against and promptly
              identify unauthorized access or use.
                `(4) TRAINING AND INFORMATION- Procedures to ensure that all
              personnel (including State and local agency staff and
              contractors) who may have access to or be required to use
              confidential program data are informed of applicable
              requirements and penalties (including those in section 6103 of
              the Internal Revenue Code of 1986), and are adequately trained
              in security procedures.
                `(5) PENALTIES- Administrative penalties (up to and including
              dismissal from employment) for unauthorized access to, or
              disclosure or use of, confidential data.'.
                (3) REGULATIONS- The Secretary of Health and Human Services
              shall prescribe final regulations for implementation of section
              454A of the Social Security Act not later than 2 years after 
              the date of the enactment of this Act.
                (4) IMPLEMENTATION TIMETABLE- Section 454(24) (42 U.S.C.
              654(24)), as amended by section 303(a)(1) of this Act, is
              amended to read as follows:
                `(24) provide that the State will have in effect an automated
              data processing and information retrieval system--
                    `(A) by October 1, 1997, which meets all require-ments of
                  this part which were enacted on or before the date of
                  enactment of the Family Support Act of 1988, and
                    `(B) by October 1, 2000, which meets all require-ments of
                  this part enacted on or before the date of the enactment of
                  the Personal Responsibility and Work Opportunity Act of
                  1996, except that such deadline shall be extended by 1 day
                  for each day (if any) by which the Secretary fails to meet
                  the deadline imposed by section 344(a)(3) of the Personal
                  Responsibility and Work Opportunity Reconciliation Act of
                  1996;'.
            (b) SPECIAL FEDERAL MATCHING RATE FOR DEVELOPMENT COSTS OF
          AUTOMATED SYSTEMS-
                (1) IN GENERAL- Section 455(a) (42 U.S.C. 655(a)) is amended--
                    (A) in paragraph (1)(B)--
                        (i) by striking `90 percent' and inserting `the
                      percent specified in paragraph (3)';
                        (ii) by striking `so much of'; and
                        (iii) by striking `which the Secretary' and all that
                      follows and inserting `, and'; and
                    (B) by adding at the end the following new paragraph:
            `(3)(A) The Secretary shall pay to each State, for each quarter 
          in fiscal years 1996 and 1997, 90 percent of so much of the State
          expenditures described in paragraph (1)(B) as the Secretary finds
          are for a system meeting the requirements specified in section
          454(16) (as in effect on September 30, 1995) but limited to the
          amount approved for States in the advance planning documents of 
          such States submitted on or before September 30, 1995.
            `(B)(i) The Secretary shall pay to each State, for each quarter 
          in fiscal years 1996 through 2001, the percentage specified in
          clause (ii) of so much of the State expenditures described in
          paragraph (1)(B) as the Secretary finds are for a system meeting 
          the requirements of sections 454(16) and 454A.
            `(ii) The percentage specified in this clause is  80 percent.'.
                (2) TEMPORARY LIMITATION ON PAYMENTS UNDER SPECIAL FEDERAL
              MATCHING RATE-
                    (A) IN GENERAL- The Secretary of Health and Human 
                  Services may not pay more than $400,000,000 in the 
                  aggregate under section 455(a)(3)(B) of the Social Security
                  Act for fiscal years 1996 through 2001.
                    (B) ALLOCATION OF LIMITATION AMONG STATES- The total
                  amount payable to a State under section 455(a)(3)(B) of 
                  such Act for fiscal years 1996 through 2001 shall not 
                  exceed the limitation determined for the State by the
                  Secretary of Health and Human Services in regulations.
                    (C) ALLOCATION FORMULA- The regulations referred to in
                  subparagraph (B) shall prescribe a formula for allocating
                  the amount specified in subparagraph (A) among States with
                  plans approved under part D of title IV of the Social
                  Security Act, which shall take into account--
                        (i) the relative size of State caseloads under such
                      part; and
                        (ii) the level of automation needed to meet the
                      automated data processing requirements of such part.
            (c) CONFORMING AMENDMENT- Section 123(c) of the Family Support 
          Act of 1988 (102 Stat. 2352; Public Law 100-485) is repealed.
          SEC. 345. TECHNICAL ASSISTANCE.
            (a) FOR TRAINING OF FEDERAL AND STATE STAFF, RESEARCH AND
          DEMONSTRATION PROGRAMS, AND SPECIAL PROJECTS OF REGIONAL OR 
          NATIONAL SIGNIFICANCE- Section 452 (42 U.S.C. 652) is amended by
          adding at the end the following new subsection:
            `(j) Out of any money in the Treasury of the United States not
          otherwise appropriated, there is hereby appropriated to the
          Secretary for each fiscal year an amount equal to 1 percent of the
          total amount paid to the Federal Government pursuant to section
          457(a) during the immediately preceding fiscal year (as determined
          on the basis of the most recent reliable data available to the
          Secretary as of the end of the third calendar quarter following the
          end of such preceding fiscal year), to cover costs incurred by the
          Secretary for--
                `(1) information dissemination and technical assistance to
              States, training of State and Federal staff, staffing studies,
              and related activities needed to improve programs under this
              part (including technical assistance concerning State automated
              systems required by this part); and
                `(2) research, demonstration, and special projects of 
              regional or national significance relating to the operation of
              State programs under this part.
          The amount appropriated under this subsection shall remain 
          available until expended.'.
            (b) OPERATION OF FEDERAL PARENT LOCATOR SERVICE- Section 453 (42
          U.S.C. 653), as amended by section 316 of this Act, is amended by
          adding at the end the following new subsection:
            `(o) RECOVERY OF COSTS- Out of any money in the Treasury of the
          United States not otherwise appropriated, there is hereby
          appropriated to the Secretary for each fiscal year an amount equal
          to 2 percent of the total amount paid to the Federal Government
          pursuant to section 457(a) during the immediately preceding fiscal
          year (as determined on the basis of the most recent reliable data
          available to the Secretary as of the end of the third calendar
          quarter following the end of such preceding fiscal year), to cover
          costs incurred by the Secretary for operation of the Federal Parent
          Locator Service under this section, to the extent such costs are 
          not recovered through user fees.'.
          SEC. 346. REPORTS AND DATA COLLECTION BY THE SECRETARY.
            (a) ANNUAL REPORT TO CONGRESS- 
                (1) Section 452(a)(10)(A) (42 U.S.C. 652(a)(10)(A)) is
              amended--
                    (A) by striking `this part;' and inserting `this part,
                  including--'; and
                    (B) by adding at the end the following new clauses:
                        `(i) the total amount of child support payments
                      collected as a result of services furnished during the
                      fiscal year to individuals receiving services under 
                      this part;
                        `(ii) the cost to the States and to the Federal
                      Government of so furnishing the services; and
                        `(iii) the number of cases involving families--
            `(I) who became ineligible for assistance under State programs
          funded under part A during a month in the fiscal year; and
            `(II) with respect to whom a child support payment was received 
          in the month;'.
                (2) Section 452(a)(10)(C) (42 U.S.C. 652(a)(10)(C)) is
              amended--
                    (A) in the matter preceding clause (i)--
                        (i) by striking `with the data required under each
                      clause being separately stated for cases' and inserting
                      `separately stated for cases';
                        (ii) by striking `cases where the child was formerly
                      receiving' and inserting `or formerly received';
                        (iii) by inserting `or 1912' after `471(a)(17)'; and
                        (iv) by inserting `for' before `all other';
                    (B) in each of clauses (i) and (ii), by striking `, and
                  the total amount of such obligations';
                    (C) in clause (iii), by striking `described in' and all
                  that follows and inserting `in which support was collected
                  during the fiscal year;';
                    (D) by striking clause (iv); and
                    (E) by redesignating clause (v) as clause (vii), and
                  inserting after clause (iii) the following new clauses:
                        `(iv) the total amount of support collected during
                      such fiscal year and distributed as current support;
                        `(v) the total amount of support collected during 
                      such fiscal year and distributed as arrearages;
                        `(vi) the total amount of support due and unpaid for
                      all fiscal years; and'.
                (3) Section 452(a)(10)(G) (42 U.S.C. 652(a)(10)(G)) is 
              amended by striking `on the use of Federal courts and'.
                (4) Section 452(a)(10) (42 U.S.C. 652(a)(10)) is amended--
                    (A) in subparagraph (H), by striking `and';
                    (B) in subparagraph (I), by striking the period and
                  inserting `; and'; and
                    (C) by inserting after subparagraph (I) the following new
                  subparagraph:
                    `(J) compliance, by State, with the standards established
                  pursuant to subsections (h) and (i).'.
                (5) Section 452(a)(10) (42 U.S.C. 652(a)(10)) is amended by
              striking all that follows subparagraph (J), as added by
              paragraph (4).
            (b) EFFECTIVE DATE- The amendments made by subsection (a) shall 
          be effective with respect to fiscal year 1997 and succeeding fiscal
          years.
              SUBTITLE F--ESTABLISHMENT AND MODIFICATION OF SUPPORT ORDERS
          SEC. 351. SIMPLIFIED PROCESS FOR REVIEW AND ADJUSTMENT OF CHILD
                            SUPPORT ORDERS.
            Section 466(a)(10) (42 U.S.C. 666(a)(10)) is amended to read as
          follows:
                `(10) REVIEW AND ADJUSTMENT OF SUPPORT ORDERS UPON REQUEST- 
                    `(A) 3-YEAR CYCLE- 
                        `(i) IN GENERAL- Procedures under which every 3 years
                      (or such shorter cycle as the State may determine), 
                      upon the request of either parent, or, if there is an
                      assignment under part A, upon the request of the State
                      agency under the State plan or of either parent, the
                      State shall with respect to a support order being
                      enforced under this part, taking into account the best
                      interests of the child involved--
            `(I) review and, if appropriate, adjust the order in accordance
          with the guidelines established pursuant to section 467(a) if the
          amount of the child support award under the order differs from the
          amount that would be awarded in accordance with the guidelines;
            `(II) apply a cost-of-living adjustment to the order in 
          accordance with a formula developed by the State; or
            `(III) use automated methods (including automated comparisons 
          with wage or State income tax data) to identify orders eligible for
          review, conduct the review, identify orders eligible for 
          adjustment, and apply the appropriate adjustment to the orders
          eligible for adjustment under any threshold that may be established
          by the State.
                        `(ii) OPPORTUNITY TO REQUEST REVIEW OF ADJUSTMENT- If
                      the State elects to conduct the review under subclause
                      (II) or (III) of clause (i), procedures which permit
                      either party to contest the adjustment, within 30 days
                      after the date of the notice of the adjustment, by
                      making a request for review and, if appropriate,
                      adjustment of the order in accordance with the child
                      support guidelines established pursuant to section
                      467(a).
                        `(iii) NO PROOF OF CHANGE IN CIRCUMSTANCES NECESSARY
                      IN 3-YEAR CYCLE REVIEW- Procedures which provide that
                      any adjustment under clause (i) shall be made without a
                      requirement for proof or showing of a change in
                      circumstances.
                    `(B) PROOF OF SUBSTANTIAL CHANGE IN CIRCUMSTANCES
                  NECESSARY IN REQUEST FOR REVIEW OUTSIDE 3-YEAR CYCLE-
                  Procedures under which, in the case of a request for a
                  review, and if appropriate, an adjustment outside the 
                  3-year cycle (or such shorter cycle as the State may
                  determine) under clause (i), the State shall review and, if
                  the requesting party demonstrates a substantial change in
                  circumstances, adjust the order in accordance with the
                  guidelines established pursuant to section 467(a).
                    `(C) NOTICE OF RIGHT TO REVIEW- Procedures which require
                  the State to provide notice not less than once every 3 
                  years to the parents subject to the order informing the
                  parents of their right to request the State to review and,
                  if appropriate, adjust the order pursuant to this 
                  paragraph. The notice may be included in the order.'.
          SEC. 352. FURNISHING CONSUMER REPORTS FOR CERTAIN PURPOSES RELATING
                            TO CHILD SUPPORT.
            Section 604 of the Fair Credit Reporting Act (15 U.S.C. 1681b) is
          amended by adding at the end the following new paragraphs:
            `(4) In response to a request by the head of a State or local
          child support enforcement agency (or a State or local government
          official authorized by the head of such an agency), if the person
          making the request certifies to the consumer reporting agency that--
                `(A) the consumer report is needed for the purpose of
              establishing an individual's capacity to make child support
              payments or determining the appropriate level of such payments;
                `(B) the paternity of the consumer for the child to which the
              obligation relates has been established or acknowledged by the
              consumer in accordance with State laws under which the
              obligation arises (if required by those laws);
                `(C) the person has provided at least 10 days' prior notice 
              to the consumer whose report is requested, by certified or
              registered mail to the last known address of the consumer, that
              the report will be requested; and
                `(D) the consumer report will be kept confidential, will be
              used solely for a purpose described in subparagraph (A), and
              will not be used in connection with any other civil,
              administrative, or criminal proceeding, or for any other purpose.
            `(5) To an agency administering a State plan under section 454 of
          the Social Security Act (42 U.S.C. 654) for use to set an initial 
          or modified child support award.'.
          SEC. 353. NONLIABILITY FOR FINANCIAL INSTITUTIONS PROVIDING
                            FINANCIAL RECORDS TO STATE CHILD SUPPORT
                            ENFORCEMENT AGENCIES IN CHILD SUPPORT CASES.
            Part D of title IV (42 U.S.C. 651-669) is amended by adding at 
          the end the following:
          `SEC. 469A. NONLIABILITY FOR FINANCIAL INSTITUTIONS PROVIDING
                            FINANCIAL RECORDS TO STATE CHILD SUPPORT
                            ENFORCEMENT AGENCIES IN CHILD SUPPORT CASES.
            `(a) IN GENERAL- Notwithstanding any other provision of Federal 
          or State law, a financial institution shall not be liable under any
          Federal or State law to any person for disclosing any financial
          record of an individual to a State child support enforcement agency
          attempting to establish, modify, or enforce a child support
          obligation of such individual.
            `(b) PROHIBITION OF DISCLOSURE OF FINANCIAL RECORD OBTAINED BY
          STATE CHILD SUPPORT ENFORCEMENT AGENCY- A State child support
          enforcement agency which obtains a financial record of an 
          individual from a financial institution pursuant to subsection (a)
          may disclose such financial record only for the purpose of, and to
          the extent necessary in, establishing, modifying, or enforcing a
          child support obligation of such individual.
            `(c) CIVIL DAMAGES FOR UNAUTHORIZED DISCLOSURE- 
                `(1) DISCLOSURE BY STATE OFFICER OR EMPLOYEE- If any person
              knowingly, or by reason of negligence, discloses a financial
              record of an individual in violation of subsection (b), such
              individual may bring a civil action for damages against such
              person in a district court of the United States.
                `(2) NO LIABILITY FOR GOOD FAITH BUT ERRONEOUS 
              INTERPRETATION- No liability shall arise under this subsection
              with respect to any disclosure which results from a good faith,
              but erroneous, interpretation of subsection (b).
                `(3) DAMAGES- In any action brought under paragraph (1), upon
              a finding of liability on the part of the defendant, the
              defendant shall be liable to the plaintiff in an amount equal 
              to the sum of--
                    `(A) the greater of--
                        `(i) $1,000 for each act of unauthorized disclosure 
                      of a financial record with respect to which such
                      defendant is found liable; or
                        `(ii) the sum of--
            `(I) the actual damages sustained by the plaintiff as a result of
          such unauthorized disclosure; plus
            `(II) in the case of a willful disclosure or a disclosure which 
          is the result of gross negligence, punitive damages; plus
                    `(B) the costs (including attorney's fees) of the action.
            `(d) DEFINITIONS- For purposes of this section--
                `(1) FINANCIAL INSTITUTION- The term `financial institution'
              means--
                    `(A) a depository institution, as defined in section 3(c)
                  of the Federal Deposit Insurance Act (12 U.S.C. 1813(c));
                    `(B) an institution-affiliated party, as defined in
                  section 3(u) of such Act (12 U.S.C. 1813(u));
                    `(C) any Federal credit union or State credit union, as
                  defined in section 101 of the Federal Credit Union Act (12
                  U.S.C. 1752), including an institution-affiliated party of
                  such a credit union, as defined in section 206(r) of such
                  Act (12 U.S.C. 1786(r)); and
                    `(D) any benefit association, insurance company, safe
                  deposit company, money-market mutual fund, or similar 
                  entity authorized to do business in the State.
                `(2) FINANCIAL RECORD- The term `financial record' has the
              meaning given such term in section 1101 of the Right to
              Financial Privacy Act of 1978 (12 U.S.C. 3401).'.
                        SUBTITLE G--ENFORCEMENT OF SUPPORT ORDERS
          SEC. 361. INTERNAL REVENUE SERVICE COLLECTION OF ARREARAGES.
            (a) COLLECTION OF FEES- Section 6305(a) of the Internal Revenue
          Code of 1986 (relating to collection of certain liability) is
          amended--
                (1) by striking `and' at the end of paragraph (3);
                (2) by striking the period at the end of paragraph (4) and
              inserting `, and';
                (3) by adding at the end the following new paragraph:
                `(5) no additional fee may be assessed for adjustments to an
              amount previously certified pursuant to such section 452(b) 
              with respect to the same obligor.'; and
                (4) by striking `Secretary of Health, Education, and Welfare'
              each place it appears and inserting `Secretary of Health and
              Human Services'.
            (b) EFFECTIVE DATE- The amendments made by this section shall
          become effective October 1, 1997.
          SEC. 362. AUTHORITY TO COLLECT SUPPORT FROM FEDERAL EMPLOYEES.
            (a) CONSOLIDATION AND STREAMLINING OF AUTHORITIES- Section 459 
          (42 U.S.C. 659) is amended to read as follows:
          `SEC. 459. CONSENT BY THE UNITED STATES TO INCOME WITHHOLDING,
                            GARNISHMENT, AND SIMILAR PROCEEDINGS FOR
                            ENFORCEMENT OF CHILD SUPPORT AND ALIMONY
                            OBLIGATIONS.
            `(a) CONSENT TO SUPPORT ENFORCEMENT- Notwithstanding any other
          provision of law (including section 207 of this Act and section 
          5301 of title 38, United States Code), effective January 1, 1975,
          moneys (the entitlement to which is based upon remuneration for
          employment) due from, or payable by, the United States or the
          District of Columbia (including any agency, subdivision, or
          instrumentality thereof) to any individual, including members of 
          the Armed Forces of the United States, shall be subject, in like
          manner and to the same extent as if the United States or the
          District of Columbia were a private person, to withholding in
          accordance with State law enacted pursuant to subsections (a)(1) 
          and (b) of section 466 and regulations of the Secretary under such
          subsections, and to any other legal process brought, by a State
          agency administering a program under a State plan approved under
          this part or by an individual obligee, to enforce the legal
          obligation of the individual to provide child support or alimony.
            `(b) CONSENT TO REQUIREMENTS APPLICABLE TO PRIVATE PERSON- With
          respect to notice to withhold income pursuant to subsection (a)(1)
          or (b) of section 466, or any other order or process to enforce
          support obligations against an individual (if the order or process
          contains or is accompanied by sufficient data to permit prompt
          identification of the individual and the moneys involved), each
          governmental entity specified in subsection (a) shall be subject to
          the same requirements as would apply if the entity were a private
          person, except as otherwise provided in this section.
            `(c) DESIGNATION OF AGENT; RESPONSE TO NOTICE OR PROCESS--
                `(1) DESIGNATION OF AGENT- The head of each agency subject to
              this section shall--
                    `(A) designate an agent or agents to receive orders and
                  accept service of process in matters relating to child
                  support or alimony; and
                    `(B) annually publish in the Federal Register the
                  designation of the agent or agents, identified by title or
                  position, mailing address, and telephone number.
                `(2) RESPONSE TO NOTICE OR PROCESS- If an agent designated
              pursuant to paragraph (1) of this subsection receives notice
              pursuant to State procedures in effect pursuant to subsection
              (a)(1) or (b) of section 466, or is effectively served with any
              order, process, or interrogatory, with respect to an
              individual's child support or alimony payment obligations, the
              agent shall--
                    `(A) as soon as possible (but not later than 15 days)
                  thereafter, send written notice of the notice or service
                  (together with a copy of the notice or service) to the
                  individual at the duty station or last-known home address 
                  of the individual;
                    `(B) within 30 days (or such longer period as may be
                  prescribed by applicable State law) after receipt of a
                  notice pursuant to such State procedures, comply with all
                  applicable provisions of section 466; and
                    `(C) within 30 days (or such longer period as may be
                  prescribed by applicable State law) after effective service
                  of any other such order, process, or interrogatory, respond
                  to the order, process, or interrogatory.
            `(d) PRIORITY OF CLAIMS- If a governmental entity specified in
          subsection (a) receives notice or is served with process, as
          provided in this section, concerning amounts owed by an individual
          to more than 1 person--
                `(1) support collection under section 466(b) must be given
              priority over any other process, as provided in section
              466(b)(7);
                `(2) allocation of moneys due or payable to an individual
              among claimants under section 466(b) shall be governed by
              section 466(b) and the regulations prescribed under such
              section; and
                `(3) such moneys as remain after compliance with paragraphs
              (1) and (2) shall be available to satisfy any other such
              processes on a first-come, first-served basis, with any such
              process being satisfied out of such moneys as remain after the
              satisfaction of all such processes which have been previously
              served.
            `(e) NO REQUIREMENT TO VARY PAY CYCLES- A governmental entity 
          that is affected by legal process served for the enforcement of an
          individual's child support or alimony payment obligations shall not
          be required to vary its normal pay and disbursement cycle in order
          to comply with the legal process.
            `(f) RELIEF FROM LIABILITY- 
                `(1) Neither the United States, nor the government of the
              District of Columbia, nor any disbursing officer shall be 
              liable with respect to any payment made from moneys due or
              payable from the United States to any individual pursuant to
              legal process regular on its face, if the payment is made in
              accordance with this section and the regulations issued to 
              carry out this section.
                `(2) No Federal employee whose duties include taking actions
              necessary to comply with the requirements of subsection (a) 
              with regard to any individual shall be subject under any law to
              any disciplinary action or civil or criminal liability or
              penalty for, or on account of, any disclosure of information
              made by the employee in connection with the carrying out of 
              such actions.
            `(g) REGULATIONS- Authority to promulgate regulations for the
          implementation of this section shall, insofar as this section
          applies to moneys due from (or payable by)--
                `(1) the United States (other than the legislative or 
              judicial branches of the Federal Government) or the government
              of the District of Columbia, be vested in the President (or the
              designee of the President);
                `(2) the legislative branch of the Federal Government, be
              vested jointly in the President pro tempore of the Senate and
              the Speaker of the House of Representatives (or their
              designees), and
                `(3) the judicial branch of the Federal Government, be vested
              in the Chief Justice of the United States (or the designee of
              the Chief Justice).
            `(h) MONEYS SUBJECT TO PROCESS- 
                `(1) IN GENERAL- Subject to paragraph (2), moneys paid or
              payable to an individual which are considered to be based upon
              remuneration for employment, for purposes of this section--
                    `(A) consist of--
                        `(i) compensation paid or payable for personal
                      services of the individual, whether the compensation is
                      denominated as wages, salary, commission, bonus, pay,
                      allowances, or otherwise (including severance pay, sick
                      pay, and incentive pay);
                        `(ii) periodic benefits (including a periodic benefit
                      as defined in section 228(h)(3)) or other payments--
            `(I) under the insurance system established by title II;
            `(II) under any other system or fund established by the United
          States which provides for the payment of pensions, retirement or
          retired pay, annuities, dependents' or survivors' benefits, or
          similar amounts payable on account of personal services performed 
          by the individual or any other individual;
            `(III) as compensation for death under any Federal program;
            `(IV) under any Federal program established to provide `black
          lung' benefits; or
            `(V) by the Secretary of Veterans Affairs as compensation for a
          service-connected disability paid by the Secretary to a former
          member of the Armed Forces who is in receipt of retired or retainer
          pay if the former member has waived a portion of the retired or
          retainer pay in order to receive such compensation; and
                        `(iii) worker's compensation benefits paid under
                      Federal or State law but
                    `(B) do not include any payment--
                        `(i) by way of reimbursement or otherwise, to defray
                      expenses incurred by the individual in carrying out
                      duties associated with the employment of the 
                      individual; or
                        `(ii) as allowances for members of the uniformed
                      services payable pursuant to chapter 7 of title 37,
                      United States Code, as prescribed by the Secretaries
                      concerned (defined by section 101(5) of such title) as
                      necessary for the efficient performance of duty.
                `(2) CERTAIN AMOUNTS EXCLUDED- In determining the amount of
              any moneys due from, or payable by, the United States to any
              individual, there shall be excluded amounts which--
                    `(A) are owed by the individual to the United States;
                    `(B) are required by law to be, and are, deducted from 
                  the remuneration or other payment involved, including
                  Federal employment taxes, and fines and forfeitures ordered
                  by court-martial;
                    `(C) are properly withheld for Federal, State, or local
                  income tax purposes, if the withholding of the amounts is
                  authorized or required by law and if amounts withheld are
                  not greater than would be the case if the individual 
                  claimed all dependents to which he was entitled (the
                  withholding of additional amounts pursuant to section
                  3402(i) of the Internal Revenue Code of 1986 may be
                  permitted only when the individual presents evidence of a
                  tax obligation which supports the additional withholding);
                    `(D) are deducted as health insurance premiums;
                    `(E) are deducted as normal retirement contributions (not
                  including amounts deducted for supplementary coverage); or
                    `(F) are deducted as normal life insurance premiums from
                  salary or other remuneration for employment (not including
                  amounts deducted for supplementary coverage).
            `(i) DEFINITIONS- For purposes of this section--
                `(1) UNITED STATES- The term `United States' includes any
              department, agency, or instrumentality of the legislative,
              judicial, or executive branch of the Federal Government, the
              United States Postal Service, the Postal Rate Commission, any
              Federal corporation created by an Act of Congress that is 
              wholly owned by the Federal Government, and the governments of
              the territories and possessions of the United States.
                `(2) CHILD SUPPORT- The term `child support', when used in
              reference to the legal obligations of an individual to provide
              such support, means amounts required to be paid under a
              judgment, decree, or order, whether temporary, final, or 
              subject to modification, issued by a court or an administrative
              agency of competent jurisdiction, for the support and
              maintenance of a child, including a child who has attained the
              age of majority under the law of the issuing State, or a child
              and the parent with whom the child is living, which provides 
              for monetary support, health care, arrearages or reimbursement,
              and which may include other related costs and fees, interest 
              and penalties, income withholding, attorney's fees, and other
              relief.
                `(3) ALIMONY- 
                    `(A) IN GENERAL- The term `alimony', when used in
                  reference to the legal obligations of an individual to
                  provide the same, means periodic payments of funds for the
                  support and maintenance of the spouse (or former spouse) of
                  the individual, and (subject to and in accordance with 
                  State law) includes separate maintenance, alimony pendente
                  lite, maintenance, and spousal support, and includes
                  attorney's fees, interest, and court costs when and to the
                  extent that the same are expressly made recoverable as such
                  pursuant to a decree, order, or judgment issued in
                  accordance with applicable State law by a court of 
                  competent jurisdiction.
                    `(B) EXCEPTIONS- Such term does not include--
                        `(i) any child support; or
                        `(ii) any payment or transfer of property or its 
                      value by an individual to the spouse or a former spouse
                      of the individual in compliance with any community
                      property settlement, equitable distribution of 
                      property, or other division of property between spouses
                      or former spouses.
                `(4) PRIVATE PERSON- The term `private person' means a person
              who does not have sovereign or other special immunity or
              privilege which causes the person not to be subject to legal
              process.
                `(5) LEGAL PROCESS- The term `legal process' means any writ,
              order, summons, or other similar process in the nature of
              garnishment--
                    `(A) which is issued by--
                        `(i) a court or an administrative agency of competent
                      jurisdiction in any State, territory, or possession of
                      the United States;
                        `(ii) a court or an administrative agency of 
                      competent jurisdiction in any foreign country with 
                      which the United States has entered into an agreement
                      which requires the United States to honor the process; or
                        `(iii) an authorized official pursuant to an order of
                      such a court or an administrative agency of competent
                      jurisdiction or pursuant to State or local law; and
                    `(B) which is directed to, and the purpose of which is to
                  compel, a governmental entity which holds moneys which are
                  otherwise payable to an individual to make a payment from
                  the moneys to another party in order to  satisfy a legal
                  obligation of the individual to provide child support or
                  make alimony payments.'.
            (b) CONFORMING AMENDMENTS- 
                (1) TO PART D OF TITLE IV- Sections 461 and 462 (42 U.S.C. 
              661 and 662) are repealed.
                (2) TO TITLE 5, UNITED STATES CODE- Section 5520a of title 5,
              United States Code, is amended, in subsections (h)(2) and (i),
              by striking `sections 459, 461, and 462 of the Social Security
              Act (42 U.S.C. 659, 661, and 662)' and inserting `section 459 
              of the Social Security Act (42 U.S.C. 659)'.
            (c) MILITARY RETIRED AND RETAINER PAY- 
                (1) DEFINITION OF COURT- Section 1408(a)(1) of title 10,
              United States Code, is amended--
                    (A) by striking `and' at the end of subparagraph (B);
                    (B) by striking the period at the end of subparagraph (C)
                  and inserting `; and'; and
                    (C) by adding after subparagraph (C) the following new
                  subparagraph:
                    `(D) any administrative or judicial tribunal of a State
                  competent to enter orders for support or maintenance
                  (including a State agency administering a program under a
                  State plan approved under part D of title IV of the Social
                  Security Act), and, for purposes of this subparagraph, the
                  term `State' includes the District of Columbia, the
                  Commonwealth of Puerto Rico, the Virgin Islands, Guam, and
                  American Samoa.'.
                (2) DEFINITION OF COURT ORDER- Section 1408(a)(2) of such
              title is amended--
                    (A) by inserting `or a support order, as defined in
                  section 453(p) of the Social Security Act (42 U.S.C.
                  653(p)),' before `which--';
                    (B) in subparagraph (B)(i), by striking `(as defined in
                  section 462(b) of the Social Security Act (42 U.S.C.
                  662(b)))' and inserting `(as defined in section 459(i)(2) 
                  of the Social Security Act (42 U.S.C. 659(i)(2)))'; and
                    (C) in subparagraph (B)(ii), by striking `(as defined in
                  section 462(c) of the Social Security Act (42 U.S.C.
                  662(c)))' and inserting `(as defined in section 459(i)(3) 
                  of the Social Security Act (42 U.S.C. 659(i)(3)))'.
                (3) PUBLIC PAYEE- Section 1408(d) of such title is amended--
                    (A) in the heading, by inserting `(OR FOR BENEFIT OF)'
                  before `SPOUSE OR'; and
                    (B) in paragraph (1), in the first sentence, by inserting
                  `(or for the benefit of such spouse or former spouse to a
                  State disbursement unit established pursuant to section 
                  454B of the Social Security Act or other public payee
                  designated by a State, in accordance with part D of title 
                  IV of the Social Security Act, as directed by court order,
                  or as otherwise directed in accordance with such part D)' 
                  before `in an amount sufficient'.
                (4) RELATIONSHIP TO PART D OF TITLE IV- Section 1408 of such
              title is amended by adding at the end the following new
              subsection:
            `(j) RELATIONSHIP TO OTHER LAWS- In any case involving an order
          providing for payment of child support (as defined in section
          459(i)(2) of the Social Security Act) by a member who has never 
          been married to the other parent of the child, the provisions of
          this section shall not apply, and the case shall be subject to the
          provisions of section 459 of such Act.'.
            (d) EFFECTIVE DATE- The amendments made by this section shall
          become effective 6 months after the date of the enactment of this
          Act.
          SEC. 363. ENFORCEMENT OF CHILD SUPPORT OBLIGATIONS OF MEMBERS OF 
                            THE ARMED FORCES.
            (a) AVAILABILITY OF LOCATOR INFORMATION- 
                (1) MAINTENANCE OF ADDRESS INFORMATION- The Secretary of
              Defense shall establish a centralized personnel locator service
              that includes the address of each member of the Armed Forces
              under the jurisdiction of the Secretary. Upon request of the
              Secretary of Transportation, addresses for members of the Coast
              Guard shall be included in the centralized personnel locator
              service.
                (2) TYPE OF ADDRESS- 
                    (A) RESIDENTIAL ADDRESS- Except as provided in
                  subparagraph (B), the address for a member of the Armed
                  Forces shown in the locator service shall be the 
                  residential address of that member.
                    (B) DUTY ADDRESS- The address for a member of the Armed
                  Forces shown in the locator service shall be the duty
                  address of that member in the case of a member--
                        (i) who is permanently assigned overseas, to a 
                      vessel, or to a routinely deployable unit; or
                        (ii) with respect to whom the Secretary concerned
                      makes a determination that the member's residential
                      address should not be disclosed due to national 
                      security or safety concerns.
                (3) UPDATING OF LOCATOR INFORMATION- Within 30 days after a
              member listed in the locator service establishes a new
              residential address (or a new duty address, in the case of a
              member covered by paragraph (2)(B)), the Secretary concerned
              shall update the locator service to indicate the new address of
              the member.
                (4) AVAILABILITY OF INFORMATION- The Secretary of Defense
              shall make information regarding the address of a member of the
              Armed Forces listed in the locator service available, on
              request, to the Federal Parent Locator Service established 
              under section 453 of the Social Security Act.
            (b) FACILITATING GRANTING OF LEAVE FOR ATTENDANCE AT HEARINGS- 
                (1) REGULATIONS- The Secretary of each military department,
              and the Secretary of Transportation with respect to the Coast
              Guard when it is not operating as a service in the Navy, shall
              prescribe regulations to facilitate the granting of leave to a
              member of the Armed Forces under the jurisdiction of that
              Secretary in a case in which--
                    (A) the leave is needed for the member to attend a 
                  hearing described in paragraph (2);
                    (B) the member is not serving in or with a unit deployed
                  in a contingency operation (as defined in section 101 of
                  title 10, United States Code); and
                    (C) the exigencies of military service (as determined by
                  the Secretary concerned) do not otherwise require that such
                  leave not be granted.
                (2) COVERED HEARINGS- Paragraph (1) applies to a hearing that
              is conducted by a court or pursuant to an administrative 
              process established under State law, in connection with a civil
              action--
                    (A) to determine whether a member of the Armed Forces is 
                  a natural parent of a child; or
                    (B) to determine an obligation of a member of the Armed
                  Forces to provide child support.
                (3) DEFINITIONS- For purposes of this subsection--
                    (A) The term `court' has the meaning given that term in
                  section 1408(a) of title 10, United States Code.
                    (B) The term `child support' has the meaning given such
                  term in section 459(i) of the Social Security Act (42 
                  U.S.C. 659(i)).
            (c) PAYMENT OF MILITARY RETIRED PAY IN COMPLIANCE WITH CHILD
          SUPPORT ORDERS-
                (1) DATE OF CERTIFICATION OF COURT ORDER- Section 1408 of
              title 10, United States Code, as amended by section 362(c)(4) 
              of this Act, is amended--
                    (A) by redesignating subsections (i) and (j) as
                  subsections (j) and (k), respectively; and
                    (B) by inserting after subsection (h) the following new
                  subsection:
            `(i) CERTIFICATION DATE- It is not necessary that the date of a
          certification of the authenticity or completeness of a copy of a
          court order for child support received by the Secretary concerned
          for the purposes of this section be recent in relation to the date
          of receipt by the Secretary.'.
                (2) PAYMENTS CONSISTENT WITH ASSIGNMENTS OF RIGHTS TO STATES-
              Section 1408(d)(1) of such title is amended by inserting after
              the first sentence the following new sentence: `In the case of 
              a spouse or former spouse who, pursuant to section 408(a)(3) of
              the Social Security Act (42 U.S.C. 608(a)(4)), assigns to a
              State the rights of the spouse or former spouse to receive
              support, the Secretary concerned may make the child support
              payments referred to in the preceding sentence to that State in
              amounts consistent with that assignment of rights.'.
                (3) ARREARAGES OWED BY MEMBERS OF THE UNIFORMED SERVICES-
              Section 1408(d) of such title is amended by adding at the end
              the following new paragraph:
            `(6) In the case of a court order for which effective service is
          made on the Secretary concerned on or after the date of the
          enactment of this paragraph and which provides for payments from 
          the disposable retired pay of a member to satisfy the amount of
          child support set forth in the order, the authority provided in
          paragraph (1) to make payments from the disposable retired pay of a
          member to satisfy the amount of child support set forth in a court
          order shall apply to payment of any amount of child support
          arrearages set forth in that order as well as to amounts of child
          support that currently become due.'.
                (4) PAYROLL DEDUCTIONS- The Secretary of Defense shall begin
              payroll deductions within 30 days after receiving notice of
              withholding, or for the first pay period that begins after such
              30-day period.
          SEC. 364. VOIDING OF FRAUDULENT TRANSFERS.
            Section 466 (42 U.S.C. 666), as amended by section 321 of this
          Act, is amended by adding at the end the following new subsection:
            `(g) LAWS VOIDING FRAUDULENT TRANSFERS- In order to satisfy
          section 454(20)(A), each State must have in effect--
                `(1)(A) the Uniform Fraudulent Conveyance Act of 1981;
                `(B) the Uniform Fraudulent Transfer Act of 1984; or
                `(C) another law, specifying indicia of fraud which create a
              prima facie case that a debtor transferred income or property 
              to avoid payment to a child support creditor, which the
              Secretary finds affords comparable rights to child support
              creditors; and
                `(2) procedures under which, in any case in which the State
              knows of a transfer by a child support debtor with respect to
              which such a prima facie case is established, the State must--
                    `(A) seek to void such transfer; or
                    `(B) obtain a settlement in the best interests of the
                  child support creditor.'.
          SEC. 365. WORK REQUIREMENT FOR PERSONS OWING PAST-DUE CHILD SUPPORT.
            (a) IN GENERAL- Section 466(a) (42 U.S.C. 666(a)), as amended by
          sections 315, 317, and 323 of this Act, is amended by inserting
          after paragraph (14) the following new paragraph:
                `(15) PROCEDURES TO ENSURE THAT PERSONS OWING PAST-DUE 
              SUPPORT WORK OR HAVE A PLAN FOR PAYMENT OF SUCH SUPPORT-
                    `(A) IN GENERAL- Procedures under which the State has the
                  authority, in any case in which an individual owes past-due
                  support with respect to a child receiving assistance under 
                  a State program funded under part A, to issue an order or 
                  to request that a court or an administrative process
                  established pursuant to State law issue an order that
                  requires the individual to--
                        `(i) pay such support in accordance with a plan
                      approved by the court, or, at the option of the State, 
                      a plan approved by the State agency administering the
                      State program under this part; or
                        `(ii) if the individual is subject to such a plan and
                      is not incapacitated, participate in such work
                      activities (as defined in section 407(d)) as the court,
                      or, at the option of the State, the State agency
                      administering the State program under this part, deems
                      appropriate.
                    `(B) PAST-DUE SUPPORT DEFINED- For purposes of
                  subparagraph (A), the term `past-due support' means the
                  amount of a delinquency, determined under a court order, or
                  an order of an administrative process established under
                  State law, for support and maintenance of a child, or of a
                  child and the parent with whom the child is living.'.
            (b) CONFORMING AMENDMENT- The flush paragraph at the end of
          section 466(a) (42 U.S.C. 666(a)) is amended by striking `and (7)'
          and inserting `(7), and (15)'.
          SEC. 366. DEFINITION OF SUPPORT ORDER.
            Section 453 (42 U.S.C. 653) as amended by sections 316 and 345(b)
          of this Act, is amended by adding at the end the following new
          subsection:
            `(p) SUPPORT ORDER DEFINED- As used in this part, the term
          `support order' means a judgment, decree, or order, whether
          temporary, final, or subject to modification, issued by a court or
          an administrative agency of competent jurisdiction, for the support
          and maintenance of a child, including a child who has attained the
          age of majority under the law of the issuing State, or a child and
          the parent with whom the child is living, which provides for
          monetary support, health care, arrearages, or reimbursement, and
          which may include related costs and fees, interest and penalties,
          income withholding, attorneys' fees, and other relief.'.
          SEC. 367. REPORTING ARREARAGES TO CREDIT BUREAUS.
            Section 466(a)(7) (42 U.S.C. 666(a)(7)) is amended to read as
          follows:
                `(7) REPORTING ARREARAGES TO CREDIT BUREAUS- 
                    `(A) IN GENERAL- Procedures (subject to safeguards
                  pursuant to subparagraph (B)) requiring the State to report
                  periodically to consumer reporting agencies (as defined in
                  section 603(f) of the Fair Credit Reporting Act (15 U.S.C.
                  1681a(f)) the name of any noncustodial parent who is
                  delinquent in the payment of support, and the amount of
                  overdue support owed by such parent.
                    `(B) SAFEGUARDS- Procedures ensuring that, in carrying 
                  out subparagraph (A), information with respect to a
                  noncustodial parent is reported--
                        `(i) only after such parent has been afforded all due
                      process required under State law, including notice and 
                      a reasonable opportunity to contest the accuracy of 
                      such information; and
                        `(ii) only to an entity that has furnished evidence
                      satisfactory to the State that the entity is a consumer
                      reporting agency (as so defined).'.
          SEC. 368. LIENS.
            Section 466(a)(4) (42 U.S.C. 666(a)(4)) is amended to read as
          follows:
                `(4) LIENS- Procedures under which--
                    `(A) liens arise by operation of law against real and
                  personal property for amounts of overdue support owed by a
                  noncustodial parent who resides or owns property in the
                  State; and
                    `(B) the State accords full faith and credit to liens
                  described in subparagraph (A) arising in another State, 
                  when the State agency, party, or other entity seeking to
                  enforce such a lien complies with the procedural rules
                  relating to recording or serving liens that arise within 
                  the State, except that such rules may not require judicial
                  notice or hearing prior to the enforcement of such a lien.'.
          SEC. 369. STATE LAW AUTHORIZING SUSPENSION OF LICENSES.
            Section 466(a) (42 U.S.C. 666(a)), as amended by sections 315,
          317, 323, and 365 of this Act, is amended by inserting after
          paragraph (15) the following:
                `(16) AUTHORITY TO WITHHOLD OR SUSPEND LICENSES- Procedures
              under which the State has (and uses in appropriate cases)
              authority to withhold or suspend, or to restrict the use of
              driver's licenses, professional and occupational licenses, and
              recreational licenses of individuals owing overdue support or
              failing, after receiving appropriate notice, to comply with
              subpoenas or warrants relating to paternity or child support
              proceedings.'.
          SEC. 370. DENIAL OF PASSPORTS FOR NONPAYMENT OF CHILD SUPPORT.
            (a) HHS CERTIFICATION PROCEDURE- 
                (1) SECRETARIAL RESPONSIBILITY- Section 452 (42 U.S.C. 652),
              as amended by section 345 of this Act, is amended by adding at
              the end the following new subsection:
            `(k)(1) If the Secretary receives a certification by a State
          agency in accordance with the requirements of section 454(31) that
          an individual owes arrearages of child support in an amount
          exceeding $5,000, the Secretary shall transmit such certification 
          to the Secretary of State for action (with respect to denial,
          revocation, or limitation of passports) pursuant to paragraph (2).
            `(2) The Secretary of State shall, upon certification by the
          Secretary transmitted under paragraph (1), refuse to issue a
          passport to such individual, and may revoke, restrict, or limit a
          passport issued previously to such individual.
            `(3) The Secretary and the Secretary of State shall not be liable
          to an individual for any action with respect to a certification by 
          a State agency under this section.'.
                (2) STATE AGENCY RESPONSIBILITY- Section 454 (42 U.S.C. 654),
              as amended by sections 301(b), 303(a), 312(b), 313(a), 333, and
              343(b) of this Act, is amended--
                    (A) by striking `and' at the end of paragraph (29);
                    (B) by striking the period at the end of paragraph (30)
                  and inserting `; and'; and
                    (C) by adding after paragraph (30) the following new
                  paragraph:
                `(31) provide that the State agency will have in effect a
              procedure for certifying to the Secretary, for purposes of the
              procedure under section 452(k), determinations that individuals
              owe arrearages of child support in an amount exceeding $5,000,
              under which procedure--
                    `(A) each individual concerned is afforded notice of such
                  determination and the consequences thereof, and an
                  opportunity to contest the determination; and
                    `(B) the certification by the State agency is furnished 
                  to the Secretary in such format, and accompanied by such
                  supporting documentation, as the Secretary may require.'.
            (b) EFFECTIVE DATE- This section and the amendments made by this
          section shall become effective October 1, 1997.
          SEC. 371. INTERNATIONAL SUPPORT ENFORCEMENT.
            (a) AUTHORITY FOR INTERNATIONAL AGREEMENTS- Part D of title IV, 
          as amended by section 362(a) of this Act, is amended by adding 
          after section 459 the following new section:
          `SEC. 459A. INTERNATIONAL SUPPORT ENFORCEMENT.
            `(a) AUTHORITY FOR DECLARATIONS- 
                `(1) DECLARATION- The Secretary of State, with the 
              concurrence of the Secretary of Health and Human Services, is
              authorized to declare any foreign country (or a political
              subdivision thereof) to be a foreign reciprocating country if
              the foreign country has established, or undertakes to 
              establish, procedures for the establishment and enforcement of
              duties of support owed to obligees who are residents of the
              United States, and such procedures are substantially in
              conformity with the standards prescribed under subsection (b).
                `(2) REVOCATION- A declaration with respect to a foreign
              country made pursuant to paragraph (1) may be revoked if the
              Secretaries of State and Health and Human Services determine
              that--
                    `(A) the procedures established by the foreign country
                  regarding the establishment and enforcement of duties of
                  support have been so changed, or the foreign country's
                  implementation of such procedures is so unsatisfactory, 
                  that such procedures do not meet the criteria for such a
                  declaration; or
                    `(B) continued operation of the declaration is not
                  consistent with the purposes of this part.
                `(3) FORM OF DECLARATION- A declaration under paragraph (1)
              may be made in the form of an international agreement, in
              connection with an international agreement or corresponding
              foreign declaration, or on a unilateral basis.
            `(b) STANDARDS FOR FOREIGN SUPPORT ENFORCEMENT PROCEDURES- 
                `(1) MANDATORY ELEMENTS- Support enforcement procedures of a
              foreign country which may be the subject of a declaration
              pursuant to subsection (a)(1) shall include the following
              elements:
                    `(A) The foreign country (or political subdivision
                  thereof) has in effect procedures, available to residents 
                  of the United States--
                        `(i) for establishment of paternity, and for
                      establishment of orders of support for children and
                      custodial parents; and
                        `(ii) for enforcement of orders to provide support to
                      children and custodial parents, including procedures 
                      for collection and appropriate distribution of support
                      payments under such orders.
                    `(B) The procedures described in subparagraph (A),
                  including legal and administrative assistance, are provided
                  to residents of the United States at no cost.
                    `(C) An agency of the foreign country is designated as a
                  Central Authority responsible for--
                        `(i) facilitating support enforcement in cases
                      involving residents of the foreign country and 
                      residents of the United States; and
                        `(ii) ensuring compliance with the standards
                      established pursuant to this subsection.
                `(2) ADDITIONAL ELEMENTS- The Secretary of Health and Human
              Services and the Secretary of State, in consultation with the
              States, may establish such additional standards as may be
              considered necessary to further the purposes of this section.
            `(c) DESIGNATION OF UNITED STATES CENTRAL AUTHORITY- It shall be
          the responsibility of the Secretary of Health and Human Services to
          facilitate support enforcement in cases involving residents of the
          United States and residents of foreign countries that are the
          subject of a declaration under this section, by activities
          including--
                `(1) development of uniform forms and procedures for use in
              such cases;
                `(2) notification of foreign reciprocating countries of the
              State of residence of individuals sought for support 
              enforcement purposes, on the basis of information provided by
              the Federal Parent Locator Service; and
                `(3) such other oversight, assistance, and coordination
              activities as the Secretary may find necessary and appropriate.
            `(d) EFFECT ON OTHER LAWS- States may enter into reciprocal
          arrangements for the establishment and enforcement of support
          obligations with foreign countries that are not the subject of a
          declaration pursuant to subsection (a), to the extent consistent
          with Federal law.'.
            (b) STATE PLAN REQUIREMENT- Section 454 (42 U.S.C. 654), as
          amended by sections 301(b), 303(a), 312(b), 313(a), 333, 343(b), 
          and 370(a)(2) of this Act, is amended--
                (1) by striking `and' at the end of paragraph (30);
                (2) by striking the period at the end of paragraph (31) and
              inserting `; and'; and
                (3) by adding after paragraph (31) the following new paragraph:
                `(32)(A) provide that any request for services under this 
              part by a foreign reciprocating country or a foreign country
              with which the State has an arrangement described in section
              459A(d)(2) shall be treated as a request by a State;
                `(B) provide, at State option, notwithstanding paragraph (4)
              or any other provision of this part, for services under the 
              plan for enforcement of a spousal support order not described 
              in paragraph (4)(B) entered by such a country (or subdivision);
              and
                `(C) provide that no applications will be required from, and
              no costs will be assessed for such services against, the 
              foreign reciprocating country or foreign obligee (but costs may
              at State option be assessed against the obligor).'.
          SEC. 372. FINANCIAL INSTITUTION DATA MATCHES.
            Section 466(a) (42 U.S.C. 666(a)), as amended by sections 315,
          317, 323, 365, and 369 of this Act, is amended by inserting after
          paragraph (16) the following new paragraph:
                `(17) FINANCIAL INSTITUTION DATA MATCHES- 
                    `(A) IN GENERAL- Procedures under which the State agency
                  shall enter into agreements with financial institutions
                  doing business in the State--
                        `(i) to develop and operate, in coordination with 
                      such financial institutions, a data match system, using
                      automated data exchanges to the maximum extent 
                      feasible, in which each such financial institution is
                      required to provide for each calendar quarter the name,
                      record address, social security number or other 
                      taxpayer identification number, and other identifying
                      information for each noncustodial parent who maintains
                      an account at such institution and who owes past-due
                      support, as identified by the State by name and social
                      security number or other taxpayer identification 
                      number; and
                        `(ii) in response to a notice of lien or levy,
                      encumber or surrender, as the case may be, assets held
                      by such institution on behalf of any noncustodial 
                      parent who is subject to a child support lien pursuant
                      to paragraph (4).
                    `(B) REASONABLE FEES- The State agency may pay a
                  reasonable fee to a financial institution for conducting 
                  the data match provided for in subparagraph (A)(i), not to
                  exceed the actual costs incurred by such financial
                  institution.
                    `(C) LIABILITY- A financial institution shall not be
                  liable under any Federal or State law to any person--
                        `(i) for any disclosure of information to the State
                      agency under subparagraph (A)(i);
                        `(ii) for encumbering or surrendering any assets held
                      by such financial institution in response to a notice 
                      of lien or levy issued by the State agency as provided
                      for in subparagraph (A)(ii); or
                        `(iii) for any other action taken in good faith to
                      comply with the requirements of subparagraph (A).
                    `(D) DEFINITIONS- For purposes of this paragraph--
                        `(i) FINANCIAL INSTITUTION- The term `financial
                      institution' has the meaning given to such term by
                      section 469A(d)(1).
                        `(ii) ACCOUNT- The term `account' means a demand
                      deposit account, checking or negotiable withdrawal 
                      order account, savings account, time deposit account, 
                      or money-market mutual fund account.'.
          SEC. 373. ENFORCEMENT OF ORDERS AGAINST PATERNAL OR MATERNAL
                            GRANDPARENTS IN CASES OF MINOR PARENTS.
            Section 466(a) (42 U.S.C. 666(a)), as amended by sections 315,
          317, 323, 365, 369, and 372 of this Act, is amended by inserting
          after paragraph (17) the following new paragraph:
                `(18) ENFORCEMENT OF ORDERS AGAINST PATERNAL OR MATERNAL
              GRANDPARENTS- Procedures under which, at the State's option, 
              any child support order enforced under this part with respect 
              to a child of minor parents, if the custodial parent of such
              child is receiving assistance under the State program under 
              part A, shall be enforceable, jointly and severally, against 
              the parents of the noncustodial parent of such child.'.
          SEC. 374. NONDISCHARGEABILITY IN BANKRUPTCY OF CERTAIN DEBTS FOR 
                            THE SUPPORT OF A CHILD.
            (a) AMENDMENT TO TITLE 11 OF THE UNITED STATES CODE- Section
          523(a) of title 11, United States Code, is amended--
                (1) by striking `or' at the end of paragraph (16);
                (2) by striking the period at the end of paragraph (17) and
              inserting `; or';
                (3) by adding at the end the following:
                `(18) owed under State law to a State or municipality that is--
                    `(A) in the nature of support, and
                    `(B) enforceable under part D of title IV of the Social
                  Security Act (42 U.S.C. 601 et seq.).'; and
                (4) in paragraph (5), by striking `section 402(a)(26)' and
              inserting `section 408(a)(3)'.
            (b) AMENDMENT TO THE SOCIAL SECURITY ACT- Section 456(b) (42
          U.S.C. 656(b)) is amended to read as follows:
            `(b) NONDISCHARGEABILITY- A debt (as defined in section 101 of
          title 11 of the United States Code) owed under State law to a State
          (as defined in such section) or municipality (as defined in such
          section) that is in the nature of support and that is enforceable
          under this part is not released by a discharge in bankruptcy under
          title 11 of the United States Code.'.
            (c) APPLICATION OF AMENDMENTS- The amendments made by this 
          section shall apply only with respect to cases commenced under 
          title 11 of the United States Code after the date of the enactment
          of this Act.
          SEC. 375. CHILD SUPPORT ENFORCEMENT FOR INDIAN TRIBES.
            (a) CHILD SUPPORT ENFORCEMENT AGREEMENTS- Section 454 (42 U.S.C.
          654), as amended by sections 301(b), 303(a), 312(b), 313(a), 333,
          343(b), 370(a)(2), and 371(b) of this Act, is amended--
                (1) by striking `and' at the end of paragraph (31);
                (2) by striking the period at the end of paragraph (32) and
              inserting `; and';
                (3) by adding after paragraph (32) the following new paragraph:
                `(33) provide that a State that receives funding pursuant to
              section 428 and that has within its borders Indian country (as
              defined in section 1151 of title 18, United States Code) may
              enter into cooperative agreements with an Indian tribe or 
              tribal organization (as defined in subsections (e) and (l) of
              section 4 of the Indian Self-Determination and Education
              Assistance Act (25 U.S.C. 450b)), if the Indian tribe or tribal
              organization demonstrates that such tribe or organization has 
              an established tribal court system or a Court of Indian 
              Offenses with the authority to establish paternity, establish,
              modify, and enforce support orders, and to enter support orders
              in accordance with child support guidelines established by such
              tribe or organization, under which the State and tribe or
              organization shall provide for the cooperative delivery of 
              child support enforcement services in Indian country and for 
              the forwarding of all funding collected pursuant to the
              functions performed by the tribe or organization to the State
              agency, or conversely, by the State agency to the tribe or
              organization, which shall distribute such funding in accordance
              with such agreement.'; and
                (4) by adding at the end the following new sentence: `Nothing
              in paragraph (33) shall void any provision of any cooperative
              agreement entered into before the date of the enactment of such
              paragraph, nor shall such paragraph deprive any State of
              jurisdiction over Indian country (as so defined) that is
              lawfully exercised under section 402 of the Act entitled `An 
              Act to prescribe penalties for certain acts of violence or
              intimidation, and for other purposes', approved April 11, 1968
              (25 U.S.C. 1322).'.
            (b) DIRECT FEDERAL FUNDING TO INDIAN TRIBES AND TRIBAL
          ORGANIZATIONS- Section 455 (42 U.S.C. 655) is amended by adding at
          the end the following new subsection:
            `(b) The Secretary may, in appropriate cases, make direct 
          payments under this part to an Indian tribe or tribal organization
          which has an approved child support enforcement plan under this
          title. In determining whether such payments are appropriate, the
          Secretary shall, at a minimum, consider whether services are being
          provided to eligible Indian recipients by the State agency through
          an agreement entered into pursuant to section 454(34).'.
            (c) COOPERATIVE ENFORCEMENT AGREEMENTS- Paragraph (7) of section
          454 (42 U.S.C. 654) is amended by inserting `and Indian tribes or
          tribal organizations (as defined in subsections (e) and (l) of
          section 4 of the Indian Self-Determination and Education Assistance
          Act (25 U.S.C. 450b))' after `law enforcement officials'.
            (d) CONFORMING AMENDMENT- Subsection (c) of section 428 (42 
          U.S.C. 628) is amended to read as follows:
            `(c) For purposes of this section, the terms `Indian tribe' and
          `tribal organization' shall have the meanings given such terms by
          subsections (e) and (l) of section 4 of the Indian
          Self-Determination and Education Assistance Act (25 U.S.C. 450b),
          respectively.'.
                               SUBTITLE H--MEDICAL SUPPORT
          SEC. 381. CORRECTION TO ERISA DEFINITION OF MEDICAL CHILD SUPPORT
                            ORDER.
            (a) IN GENERAL- Section 609(a)(2)(B) of the Employee Retirement
          Income Security Act of 1974 (29 U.S.C. 1169(a)(2)(B)) is amended--
                (1) by striking `issued by a court of competent jurisdiction';
                (2) by striking the period at the end of clause (ii) and
              inserting a comma; and
                (3) by adding, after and below clause (ii), the following:
                  `if such judgment, decree, or order (I) is issued by a 
                  court of competent jurisdiction or (II) is issued through 
                  an administrative process established under State law and
                  has the force and effect of law under applicable State law.'.
            (b) EFFECTIVE DATE- 
                (1) IN GENERAL- The amendments made by this section shall 
              take effect on the date of the enactment of this Act.
                (2) PLAN AMENDMENTS NOT REQUIRED UNTIL JANUARY 1, 1997- Any
              amendment to a plan required to be made by an amendment made by
              this section shall not be required to be made before the 1st
              plan year beginning on or after January 1, 1997, if--
                    (A) during the period after the date before the date of
                  the enactment of this Act and before such 1st plan year, 
                  the plan is operated in accordance with the requirements of
                  the amendments made by this section; and
                    (B) such plan amendment applies retroactively to the
                  period after the date before the date of the enactment of
                  this Act and before such 1st plan year.
              A plan shall not be treated as failing to be operated in
              accordance with the provisions of the plan merely because it
              operates in accordance with this paragraph.
          SEC. 382. ENFORCEMENT OF ORDERS FOR HEALTH CARE COVERAGE.
            Section 466(a) (42 U.S.C. 666(a)), as amended by sections 315,
          317, 323, 365, 369, 372, and 373 of this Act, is amended by
          inserting after paragraph (18) the following new paragraph:
                `(19) HEALTH CARE COVERAGE- Procedures under which all child
              support orders enforced pursuant to this part shall include a
              provision for the health care coverage of the child, and in the
              case in which a noncustodial parent provides such coverage and
              changes employment, and the new employer provides health care
              coverage, the State agency shall transfer notice of the
              provision to the employer, which notice shall operate to enroll
              the child in the noncustodial parent's health plan, unless the
              noncustodial parent contests the notice.'.
                SUBTITLE I--ENHANCING RESPONSIBILITY AND OPPORTUNITY FOR
                                 NON-RESIDENTIAL PARENTS
          SEC. 391. GRANTS TO STATES FOR ACCESS AND VISITATION PROGRAMS.
            Part D of title IV (42 U.S.C. 651-669), as amended by section 353
          of this Act, is amended by adding at the end the following new
          section:
          `SEC. 469B. GRANTS TO STATES FOR ACCESS AND VISITATION PROGRAMS.
            `(a) IN GENERAL- The Administration for Children and Families
          shall make grants under this section to enable States to establish
          and administer programs to support and facilitate noncustodial
          parents' access to and visitation of their children, by means of
          activities including mediation (both voluntary and mandatory),
          counseling, education, development of parenting plans, visitation
          enforcement (including monitoring, supervision and neutral drop-off
          and pickup), and development of guidelines for visitation and
          alternative custody arrangements.
            `(b) AMOUNT OF GRANT- The amount of the grant to be made to a
          State under this section for a fiscal year shall be an amount equal
          to the lesser of--
                `(1) 90 percent of State expenditures during the fiscal year
              for activities described in subsection (a); or
                `(2) the allotment of the State under subsection (c) for the
              fiscal year.
            `(c) ALLOTMENTS TO STATES- 
                `(1) IN GENERAL- The allotment of a State for a fiscal year 
              is the amount that bears the same ratio to $10,000,000 for
              grants under this section for the fiscal year as the number of
              children in the State living with only 1 biological parent 
              bears to the total number of such children in all States.
                `(2) MINIMUM ALLOTMENT- The Administration for Children and
              Families shall adjust allotments to States under paragraph (1)
              as necessary to ensure that no State is allotted less than--
                    `(A) $50,000 for fiscal year 1997 or 1998; or
                    `(B) $100,000 for any succeeding fiscal year.
            `(d) NO SUPPLANTATION OF STATE EXPENDITURES FOR SIMILAR
          ACTIVITIES- A State to which a grant is made under this section may
          not use the grant to supplant expenditures by the State for
          activities specified in subsection (a), but shall use the grant to
          supplement such expenditures at a level at least equal to the level
          of such expenditures for fiscal year 1995.
            `(e) STATE ADMINISTRATION- Each State to which a grant is made
          under this section--
                `(1) may administer State programs funded with the grant,
              directly or through grants to or contracts with courts, local
              public agencies, or nonprofit private entities;
                `(2) shall not be required to operate such programs on a
              statewide basis; and
                `(3) shall monitor, evaluate, and report on such programs in
              accordance with regulations prescribed by the Secretary.'.
                  SUBTITLE J--EFFECTIVE DATES AND CONFORMING AMENDMENTS
          SEC. 395. EFFECTIVE DATES AND CONFORMING AMENDMENTS.
            (a) IN GENERAL- Except as otherwise specifically provided (but
          subject to subsections (b) and (c))--
                (1) the provisions of this title requiring the enactment or
              amendment of State laws under section 466 of the Social 
              Security Act, or revision of State plans under section 454 of
              such Act, shall be effective with respect to periods beginning
              on and after October 1, 1996; and
                (2) all other provisions of this title shall become effective
              upon the date of the enactment of this Act.
            (b) GRACE PERIOD FOR STATE LAW CHANGES- The provisions of this
          title shall become effective with respect to a State on the later
          of--
                (1) the date specified in this title, or
                (2) the effective date of laws enacted by the legislature of
              such State implementing such provisions,
          but in no event later than the 1st day of the 1st calendar quarter
          beginning after the close of the 1st regular session of the State
          legislature that begins after the date of the enactment of this 
          Act. For purposes of the previous sentence, in the case of a State
          that has a 2-year legislative session, each year of such session
          shall be deemed to be a separate regular session of the State
          legislature.
            (c) GRACE PERIOD FOR STATE CONSTITUTIONAL AMENDMENT- A State 
          shall not be found out of compliance with any requirement enacted 
          by this title if the State is unable to so comply without amending
          the State constitution until the earlier of--
                (1) 1 year after the effective date of the necessary State
              constitutional amendment; or
                (2) 5 years after the date of the enactment of this Act.
            (d) CONFORMING AMENDMENTS- 
                (1) The following provisions are amended by striking `absent'
              each place it appears and inserting `noncustodial':
                    (A) Section 451 (42 U.S.C. 651).
                    (B) Subsections (a)(1), (a)(8), (a)(10)(E), (a)(10)(F),
                  (f), and (h) of section 452 (42 U.S.C. 652).
                    (C) Section 453(f) (42 U.S.C. 653(f)).
                    (D) Paragraphs (8), (13), and (21)(A) of section 454 (42
                  U.S.C. 654).
                    (E) Section 455(e)(1) (42 U.S.C. 655(e)(1)).
                    (F) Section 458(a) (42 U.S.C. 658(a)).
                    (G) Subsections (a), (b), and (c) of section 463 (42
                  U.S.C. 663).
                    (H) Subsections (a)(3)(A), (a)(3)(C), (a)(6), and
                  (a)(8)(B)(ii), the last sentence of subsection (a), and
                  subsections (b)(1), (b)(3)(B), (b)(3)(B)(i), (b)(6)(A)(i),
                  (b)(9), and (e) of section 466 (42 U.S.C. 666).
                (2) The following provisions are amended by striking `an
              absent' each place it appears and inserting `a noncustodial':
                    (A) Paragraphs (2) and (3) of section 453(c) (42 U.S.C.
                  653(c)).
                    (B) Subparagraphs (B) and (C) of section 454(9) (42 
                  U.S.C. 654(9)).
                    (C) Section 456(a)(3) (42 U.S.C. 656(a)(3)).
                    (D) Subsections (a)(3)(A), (a)(6), (a)(8)(B)(i),
                  (b)(3)(A), and (b)(3)(B) of section 466 (42 U.S.C. 666).
                    (E) Paragraphs (2) and (4) of section 469(b) (42 U.S.C.
                  669(b)).
              TITLE IV--RESTRICTING WELFARE AND PUBLIC BENEFITS FOR ALIENS
          SEC. 400. STATEMENTS OF NATIONAL POLICY CONCERNING WELFARE AND
                            IMMIGRATION.
            The Congress makes the following statements concerning national
          policy with respect to welfare and immigration:
                (1) Self-sufficiency has been a basic principle of United
              States immigration law since this country's earliest 
              immigration statutes.
                (2) It continues to be the immigration policy of the United
              States that--
                    (A) aliens within the Nation's borders not depend on
                  public resources to meet their needs, but rather rely on
                  their own capabilities and the resources of their families,
                  their sponsors, and private organizations, and
                    (B) the availability of public benefits not constitute an
                  incentive for immigration to the United States.
                (3) Despite the principle of self-sufficiency, aliens have
              been applying for and receiving public benefits from Federal,
              State, and local governments at increasing rates.
                (4) Current eligibility rules for public assistance and
              unenforceable financial support agreements have proved wholly
              incapable of assuring that individual aliens not burden the
              public benefits system.
                (5) It is a compelling government interest to enact new rules
              for eligibility and sponsorship agreements in order to assure
              that aliens be self-reliant in accordance with national
              immigration policy.
                (6) It is a compelling government interest to remove the
              incentive for illegal immigration provided by the availability
              of public benefits.
                (7) With respect to the State authority to make 
              determinations concerning the eligibility of qualified aliens
              for public benefits in this title, a State that chooses to
              follow the Federal classification in determining the 
              eligibility of such aliens for public assistance shall be
              considered to have chosen the least restrictive means available
              for achieving the compelling governmental interest of assuring
              that aliens be self-reliant in accordance with national
              immigration policy.
                      SUBTITLE A--ELIGIBILITY FOR FEDERAL BENEFITS
          SEC. 401. ALIENS WHO ARE NOT QUALIFIED ALIENS INELIGIBLE FOR 
                            FEDERAL PUBLIC BENEFITS.
            (a) IN GENERAL- Notwithstanding any other provision of law and
          except as provided in subsection (b), an alien who is not a
          qualified alien (as defined in section 431) is not eligible for any
          Federal public benefit (as defined in subsection (c)).
            (b) EXCEPTIONS- 
                (1) Subsection (a) shall not apply with respect to the
              fol-lowing Federal public benefits:
                    (A) Medical assistance under title XIX of the Social
                  Security Act (or any successor program to such title) for
                  care and services that are necessary for the treatment of 
                  an emergency medical condition (as defined in section
                  1903(v)(3) of such Act) of the alien involved and are not
                  related to an organ transplant procedure, if the alien
                  involved otherwise meets the eligibility requirements for
                  medical assistance under the State plan approved under such
                  title (other than the requirement of the receipt of aid or
                  assistance under title IV of such Act, supplemental 
                  security income benefits under title XVI of such Act, or a
                  State supplementary payment).
                    (B) Short-term, non-cash, in-kind emergency disaster
                  relief.
                    (C) Public health assistance (not including any 
                  assistance under title XIX of the Social Security Act) for
                  immunizations with respect to immunizable diseases and for
                  testing and treatment of symptoms of communicable diseases
                  whether or not such symptoms are caused by a communicable
                  disease.
                    (D) Programs, services, or assistance (such as soup
                  kitchens, crisis counseling and intervention, and 
                  short-term shelter) specified by the Attorney General, in
                  the Attorney General's sole and unreviewable discretion
                  after consultation with appropriate Federal agencies and
                  departments, which (i) deliver in-kind services at the
                  community level, including through public or private
                  nonprofit agencies; (ii) do not condition the provision of
                  assistance, the amount of assistance provided, or the cost
                  of assistance provided on the individual recipient's income
                  or resources; and (iii) are necessary for the protection of
                  life or safety.
                    (E) Programs for housing or community development
                  assistance or financial assistance administered by the
                  Secretary of Housing and Urban Development, any program
                  under title V of the Housing Act of 1949, or any assistance
                  under section 306C of the Consolidated Farm and Rural
                  Development Act, to the extent that the alien is receiving
                  such a benefit on the date of the enactment of this Act.
                (2) Subsection (a) shall not apply to any benefit payable
              under title II of the Social Security Act to an alien who is
              lawfully present in the United States as determined by the
              Attorney General, to any benefit if nonpayment of such benefit
              would contravene an international agreement described in 
              section 233 of the Social Security Act, to any benefit if
              nonpayment would be contrary to section 202(t) of the Social
              Security Act, or to any benefit payable under title II of the
              Social Security Act to which entitlement is based on an
              application filed in or before the month in which this Act
              becomes law.
            (c) FEDERAL PUBLIC BENEFIT DEFINED- 
                (1) Except as provided in paragraph (2), for purposes of this
              title the term `Federal public benefit' means--
                    (A) any grant, contract, loan, professional license, or
                  commercial license provided by an agency of the United
                  States or by appropriated funds of the United States; and
                    (B) any retirement, welfare, health, disability, public 
                  or assisted housing, postsecondary education, food
                  assistance, unemployment benefit, or any other similar
                  benefit for which payments or assistance are provided to an
                  individual, household, or family eligibility unit by an
                  agency of the United States or by appropriated funds of the
                  United States.
                (2) Such term shall not apply--
                    (A) to any contract, professional license, or commercial
                  license for a nonimmigrant whose visa for entry is related
                  to such employment in the United States; or
                    (B) with respect to benefits for an alien who as a work
                  authorized nonimmigrant or as an alien lawfully admitted 
                  for permanent residence under the Immigration and
                  Nationality Act qualified for such benefits and for whom 
                  the United States under reciprocal treaty agreements is
                  required to pay benefits, as determined by the Attorney
                  General, after consultation with the Secretary of State.
          SEC. 402. LIMITED ELIGIBILITY OF QUALIFIED ALIENS FOR CERTAIN
                            FEDERAL PROGRAMS.
            (a) LIMITED ELIGIBILITY FOR SPECIFIED FEDERAL PROGRAMS- 
                (1) IN GENERAL- Notwithstanding any other provision of law 
              and except as provided in paragraph (2), an alien who is a
              qualified alien (as defined in section 431) is not eligible for
              any specified Federal program (as defined in para-graph (3)).
                (2) EXCEPTIONS- 
                    (A) TIME-LIMITED EXCEPTION FOR REFUGEES AND ASYLEES-
                  Paragraph (1) shall not apply to an alien until 5 years
                  after the date--
                        (i) an alien is admitted to the United States as a
                      refugee under section 207 of the Immigration and
                      Nationality Act;
                        (ii) an alien is granted asylum under section 208 of
                      such Act; or
                        (iii) an alien's deportation is withheld under 
                      section 243(h) of such Act.
                    (B) CERTAIN PERMANENT RESIDENT ALIENS- Paragraph (1) 
                  shall not apply to an alien who--
                        (i) is lawfully admitted to the United States for
                      permanent residence under the Immigration and
                      Nationality Act; and
                        (ii)(I) has worked 40 qualifying quarters of coverage
                      as defined under title II of the Social Security Act or
                      can be credited with such qualifying quarters as
                      provided under section 435, and (II) in the case of any
                      such qualifying quarter creditable for any period
                      beginning after December 31, 1996, did not receive any
                      Federal means-tested public benefit (as provided under
                      section 403) during any such period.
                    (C) VETERAN AND ACTIVE DUTY EXCEPTION- Paragraph (1) 
                  shall not apply to an alien who is lawfully residing in any
                  State and is--
                        (i) a veteran (as defined in section 101 of title 38,
                      United States Code) with a discharge characterized as 
                      an honorable discharge and not on account of alienage,
                        (ii) on active duty (other than active duty for
                      training) in the Armed Forces of the United States, or
                        (iii) the spouse or unmarried dependent child of an
                      individual described in clause (i) or (ii).
                    (D) TRANSITION FOR ALIENS CURRENTLY RECEIVING BENEFITS- 
                        (i) SSI- 
            (I) IN GENERAL- With respect to the specified Federal program
          described in paragraph (3)(A), during the period beginning on the
          date of the enactment of this Act and ending on the date which is 1
          year after such date of enactment, the Commissioner of Social
          Security shall redetermine the eligibility of any individual who is
          receiving benefits under such program as of the date of the
          enactment of this Act and whose eligibility for such benefits may
          terminate by reason of the provisions of this subsection.
            (II) REDETERMINATION CRITERIA-  With respect to any
          redetermination under subclause (I), the Commissioner of Social
          Security shall apply the eligibility criteria for new applicants 
          for benefits under such program.
            (III) GRANDFATHER PROVISION- The provisions of this subsection 
          and the redetermination under subclause (I), shall only apply with
          respect to the benefits of an individual described in subclause (I)
          for months beginning on or after the date of the redetermination
          with respect to such individual.
            (IV) NOTICE- Not later than March 31, 1997, the Commissioner of
          Social Security shall notify an individual described in subclause
          (I) of the provisions of this clause.
                        (ii) FOOD STAMPS- 
            (I) IN GENERAL- With respect to the specified Federal program
          described in paragraph (3)(B), during the period beginning on the
          date of enactment of this Act and ending on the date which is 1 
          year after the date of enactment, the State agency shall, at the
          time of the recertification, recertify the eligibility of any
          individual who is receiving benefits under such program as of the
          date of enactment of this Act and whose eligibility for such
          benefits may terminate by reason of the provisions of this
          subsection.
            (II) RECERTIFICATION CRITERIA- With respect to any 
          recertification under subclause (I), the State agency shall apply
          the eligibility criteria for applicants for benefits under such
          program.
            (III) GRANDFATHER PROVISION- The provisions of this subsection 
          and the recertification under subclause (I) shall only apply with
          respect to the eligibility of an alien for a program for months
          beginning on or after the date of recertification, if on the date 
          of enactment of this Act the alien is lawfully residing in any 
          State and is receiving benefits under such program on such date of
          enactment.
                (3) SPECIFIED FEDERAL PROGRAM DEFINED- For purposes of this
              title, the term `specified Federal program' means any of the
              following:
                    (A) SSI- The supplemental security income program under
                  title XVI of the Social Security Act, including
                  supplementary payments pursuant to an agreement for Federal
                  administration under section 1616(a) of the Social Security
                  Act and payments pursuant to an agreement entered into 
                  under section 212(b) of Public Law 93-66.
                    (B) FOOD STAMPS- The food stamp program as defined in
                  section 3(h) of the Food Stamp Act of 1977.
            (b) LIMITED ELIGIBILITY FOR DESIGNATED FEDERAL PROGRAMS- 
                (1) IN GENERAL- Notwithstanding any other provision of law 
              and except as provided in section 403 and paragraph (2), a 
              State is authorized to determine the eligibility of an alien 
              who is a qualified alien (as defined in section 431) for any
              designated Federal program (as defined in paragraph (3)).
                (2) EXCEPTIONS- Qualified aliens under this paragraph shall 
              be eligible for any designated Federal program.
                    (A) TIME-LIMITED EXCEPTION FOR REFUGEES AND ASYLEES- 
                        (i) An alien who is admitted to the United States as 
                      a refugee under section 207 of the Immigration and
                      Nationality Act until 5 years after the date of an
                      alien's entry into the United States.
                        (ii)  An alien who is granted asylum under section 
                      208 of such Act until 5 years after the date of such
                      grant of asylum.
                        (iii) An alien whose deportation is being withheld
                      under section 243(h) of such Act until 5 years after
                      such withholding.
                    (B) CERTAIN PERMANENT RESIDENT ALIENS- An alien who--
                        (i) is lawfully admitted to the United States for
                      permanent residence under the Immigration and
                      Nationality Act; and
                        (ii)(I) has worked 40 qualifying quarters of coverage
                      as defined under title II of the Social Security Act or
                      can be credited with such qualifying quarters as
                      provided under section 435, and (II) in the case of any
                      such qualifying quarter creditable for any period
                      beginning after December 31, 1996, did not receive any
                      Federal means-tested public benefit (as provided under
                      section 403) during any such period.
                    (C) VETERAN AND ACTIVE DUTY EXCEPTION- An alien who is
                  lawfully residing in any State and is--
                        (i) a veteran (as defined in section 101 of title 38,
                      United States Code) with a discharge characterized as 
                      an honorable discharge and not on account of alienage,
                        (ii) on active duty (other than active duty for
                      training) in the Armed Forces of the United States, or
                        (iii) the spouse or unmarried dependent child of an
                      individual described in clause (i) or (ii).
                    (D) TRANSITION FOR THOSE CURRENTLY RECEIVING BENEFITS- An
                  alien who on the date of the enactment of this Act is
                  lawfully residing in any State and is receiving benefits
                  under such program on the date of the enactment of this Act
                  shall continue to be eligible to receive such benefits 
                  until January 1, 1997.
                (3) DESIGNATED FEDERAL PROGRAM DEFINED- For purposes of this
              title, the term `designated Federal program' means any of the
              following:
                    (A) TEMPORARY ASSISTANCE FOR NEEDY FAMILIES- The program
                  of block grants to States for temporary assistance for 
                  needy families under part A of title IV of the Social
                  Security Act.
                    (B) SOCIAL SERVICES BLOCK GRANT- The program of block
                  grants to States for social services under title XX of the
                  Social Security Act.
                    (C) MEDICAID- A State plan approved under title XIX of 
                  the Social Security Act, other than medical assistance
                  described in section 401(b)(1)(A).
          SEC. 403. FIVE-YEAR LIMITED ELIGIBILITY OF QUALIFIED ALIENS FOR
                            FEDERAL MEANS-TESTED PUBLIC BENEFIT.
            (a) IN GENERAL- Notwithstanding any other provision of law and
          except as provided in subsections (b), (c), and (d), an alien who 
          is a qualified alien (as defined in section 431) and who enters the
          United States on or after the date of the enactment of this Act is
          not eligible for any Federal means-tested public benefit for a
          period of 5 years beginning on the date of the alien's entry into
          the United States with a status within the meaning of the term
          `qualified alien'.
            (b) EXCEPTIONS- The limitation under subsection (a) shall not
          apply to the following aliens:
                (1) EXCEPTION FOR REFUGEES AND ASYLEES- 
                    (A) An alien who is admitted to the United States as a
                  refugee under section 207 of the Immigration and 
                  Nationality Act.
                    (B) An alien who is granted asylum under section 208 of
                  such Act.
                    (C) An alien whose deportation is being withheld under
                  section 243(h) of such Act.
                (2) VETERAN AND ACTIVE DUTY EXCEPTION- An alien who is
              lawfully residing in any State and is--
                    (A) a veteran (as defined in section 101 of title 38,
                  United States Code) with a discharge characterized as an
                  honorable discharge and not on account of alienage,
                    (B) on active duty (other than active duty for training)
                  in the Armed Forces of the United States, or
                    (C) the spouse or unmarried dependent child of an
                  individual described in subparagraph (A) or (B).
            (c) APPLICATION OF TERM FEDERAL MEANS-TESTED PUBLIC BENEFIT- 
                (1) The limitation under subsection (a) shall not apply to
              assistance or benefits under paragraph (2).
                (2) Assistance and benefits under this paragraph are as
              follows:
                    (A) Medical assistance described in section 401(b)(1)(A).
                    (B) Short-term, non-cash, in-kind emergency disaster
                  relief.
                    (C) Assistance or benefits under the National School 
                  Lunch Act.
                    (D) Assistance or benefits under the Child Nutrition Act
                  of 1966.
                    (E) Public health assistance (not including any 
                  assistance under title XIX of the Social Security Act) for
                  immunizations with respect to immunizable diseases and for
                  testing and treatment of symptoms of communicable diseases
                  whether or not such symptoms are caused by a communicable
                  disease.
                    (F) Payments for foster care and adoption assistance 
                  under parts B and E of title IV of the Social Security Act
                  for a parent or a child who would, in the absence of
                  subsection (a), be eligible to have such payments made on
                  the child's behalf under such part, but only if the foster
                  or adoptive parent (or parents) of such child is a 
                  qualified alien (as defined in section 431).
                    (G) Programs, services, or assistance (such as soup
                  kitchens, crisis counseling and intervention, and 
                  short-term shelter) specified by the Attorney General, in
                  the Attorney General's sole and unreviewable discretion
                  after consultation with appropriate Federal agencies and
                  departments, which (i) deliver in-kind services at the
                  community level, including through public or private
                  nonprofit agencies; (ii) do not condition the provision of
                  assistance, the amount of assistance provided, or the cost
                  of assistance provided on the individual recipient's income
                  or resources; and (iii) are necessary for the protection of
                  life or safety.
                    (H) Programs of student assistance under titles IV, V, 
                  IX, and X of the Higher Education Act of 1965, and titles
                  III, VII, and VIII of the Public Health Service Act.
                    (I) Means-tested programs under the Elementary and
                  Secondary Education Act of 1965.
                    (J) Benefits under the Head Start Act.
                    (K) Benefits under the Job Training Partnership Act.
            (d) SPECIAL RULE FOR REFUGEE AND ENTRANT ASSISTANCE FOR CUBAN AND
          HAITIAN ENTRANTS- The limitation under subsection (a) shall not
          apply to refugee and entrant assistance activities, authorized by
          title IV of the Immigration and Nationality Act and section 501 of
          the Refugee Education Assistance Act of 1980, for Cuban and Haitian
          entrants as defined in section 501(e)(2) of the Refugee Education
          Assistance Act of 1980.
          SEC. 404. NOTIFICATION AND INFORMATION REPORTING.
            (a) NOTIFICATION- Each Federal agency that administers a program
          to which section 401, 402, or 403 applies shall, directly or 
          through the States, post information and provide general
          notification to the public and to program recipients of the changes
          regarding eligibility for any such program pursuant to this subtitle.
            (b) INFORMATION REPORTING UNDER TITLE IV OF THE SOCIAL SECURITY
          ACT- Part A of title IV of the Social Security Act is amended by
          inserting the following new section after section 411:
          `SEC. 411A. STATE REQUIRED TO PROVIDE CERTAIN INFORMATION.
            `Each State to which a grant is made under section 403 shall, at
          least 4 times annually and upon request of the Immigration and
          Naturalization Service, furnish the Immigration and Naturalization
          Service with the name and address of, and other identifying
          information on, any individual who the State knows is unlawfully in
          the United States.'.
            (c) SSI- Section 1631(e) of such Act (42 U.S.C. 1383(e)) is
          amended--
                (1) by redesignating the paragraphs (6) and (7) inserted by
              sections 206(d)(2) and 206(f)(1) of the Social Security
              Independence and Programs Improvement Act of 1994 (Public Law
              103-296; 108 Stat. 1514, 1515) as paragraphs (7) and (8),
              respectively; and
                (2) by adding at the end the following new paragraph:
            `(9) Notwithstanding any other provision of law, the Commissioner
          shall, at least 4 times annually and upon request of the 
          Immigration and Naturalization Service (hereafter in this paragraph
          referred to as the `Service'), furnish the Service with the name 
          and address of, and other identifying information on, any 
          individual who the Commissioner knows is unlawfully in the United
          States, and shall ensure that each agreement entered into under
          section 1616(a) with a State provides that the State shall furnish
          such information at such times with respect to any individual who
          the State knows is unlawfully in the United States.'.
            (d) INFORMATION REPORTING FOR HOUSING PROGRAMS- Title I of the
          United States Housing Act of 1937 (42 U.S.C. 1437 et seq.) is
          amended by adding at the end the following new section:
          `SEC. 27. PROVISION OF INFORMATION TO LAW ENFORCEMENT AND OTHER
                            AGENCIES.
            `Notwithstanding any other provision of law, the Secretary shall,
          at least 4 times annually and upon request of the Immigration and
          Naturalization Service (hereafter in this section referred to as 
          the `Service'), furnish the Service with the name and address of,
          and other identifying information on, any individual who the
          Secretary knows is unlawfully in the United States, and shall 
          ensure that each contract for assistance entered into under section
          6 or 8 of this Act with a public housing agency provides that the
          public housing agency shall furnish such information at such times
          with respect to any individual who the public housing agency knows
          is unlawfully in the United States.'.
          SUBTITLE B--ELIGIBILITY FOR STATE AND LOCAL PUBLIC BENEFITS PROGRAMS
          SEC. 411. ALIENS WHO ARE NOT QUALIFIED ALIENS OR NONIMMIGRANTS
                            INELIGIBLE FOR STATE AND LOCAL PUBLIC BENEFITS.
            (a) IN GENERAL- Notwithstanding any other provision of law and
          except as provided in subsections (b) and (d), an alien who is not--
                (1) a qualified alien (as defined in section 431),
                (2) a nonimmigrant under the Immigration and Nationality Act,
              or
                (3) an alien who is paroled into the United States under
              section 212(d)(5) of such Act for less than one year,
          is not eligible for any State or local public benefit (as defined 
          in subsection (c)).
            (b) EXCEPTIONS- Subsection (a) shall not apply with respect to 
          the following State or local public benefits:
                (1) Assistance for health care items and services that are
              necessary for the treatment of an emergency medical condition
              (as defined in section 1903(v)(3) of the Social Security Act) 
              of the alien involved and are not related to an organ 
              transplant procedure.
                (2) Short-term, non-cash, in-kind emergency disaster relief.
                (3) Public health assistance for immunizations with respect 
              to immunizable diseases and for testing and treatment of
              symptoms of communicable diseases whether or not such symptoms
              are caused by a communicable disease.
                (4) Programs, services, or assistance (such as soup kitchens,
              crisis counseling and intervention, and short-term shelter)
              specified by the Attorney General, in the Attorney General's
              sole and unreviewable discretion after consultation with
              appropriate Federal agencies and departments, which (A) deliver
              in-kind services at the community level, including through
              public or private nonprofit agencies; (B) do not condition the
              provision of assistance, the amount of assistance provided, or
              the cost of assistance provided on the individual recipient's
              income or resources; and (C) are necessary for the protection 
              of life or safety.
            (c) STATE OR LOCAL PUBLIC BENEFIT DEFINED- 
                (1) Except as provided in paragraphs (2) and (3), for 
              purposes of this subtitle the term `State or local public
              benefit' means--
                    (A) any grant, contract, loan, professional license, or
                  commercial license provided by an agency of a State or 
                  local government or by appropriated funds of a State or
                  local government; and
                    (B) any retirement, welfare, health, disability, public 
                  or assisted housing, postsecondary education, food
                  assistance, unemployment benefit, or any other similar
                  benefit for which payments or assistance are provided to an
                  individual, household, or family eligibility unit by an
                  agency of a State or local government or by appropriated
                  funds of a State or local government.
                (2) Such term shall not apply--
                    (A) to any contract, professional license, or commercial
                  license for a nonimmigrant whose visa for entry is related
                  to such employment in the United States; or
                    (B) with respect to benefits for an alien who as a work
                  authorized nonimmigrant or as an alien lawfully admitted 
                  for permanent residence under the Immigration and
                  Nationality Act qualified for such benefits and for whom 
                  the United States under reciprocal treaty agreements is
                  required to pay benefits, as determined by the Secretary of
                  State, after consultation with the Attorney General.
                (3) Such term does not include any Federal public benefit
              under section 4001(c).
            (d) STATE AUTHORITY TO PROVIDE FOR ELIGIBILITY OF ILLEGAL ALIENS
          FOR STATE AND LOCAL PUBLIC BENEFITS- A State may provide that an
          alien who is not lawfully present in the United States is eligible
          for any State or local public benefit for which such alien would
          otherwise be ineligible under subsection (a) only through the
          enactment of a State law after the date of the enactment of this 
          Act which affirmatively provides for such eligibility.
          SEC. 412. STATE AUTHORITY TO LIMIT ELIGIBILITY OF QUALIFIED ALIENS
                            FOR STATE PUBLIC BENEFITS.
            (a) IN GENERAL- Notwithstanding any other provision of law and
          except as provided in subsection (b), a State is authorized to
          determine the eligibility for any State public benefits of an alien
          who is a qualified alien (as defined in section 431), a 
          nonimmigrant under the Immigration and Nationality Act, or an alien
          who is paroled into the United States under section 212(d)(5) of
          such Act for less than one year.
            (b) EXCEPTIONS- Qualified aliens under this subsection shall be
          eligible for any State public benefits.
                (1) TIME-LIMITED EXCEPTION FOR REFUGEES AND ASYLEES- 
                    (A) An alien who is admitted to the United States as a
                  refugee under section 207 of the Immigration and 
                  Nationality Act until 5 years after the date of an alien's
                  entry into the United States.
                    (B)  An alien who is granted asylum under section 208 of
                  such Act until 5 years after the date of such grant of
                  asylum.
                    (C) An alien whose deportation is being withheld under
                  section 243(h) of such Act until 5 years after such
                  with-holding.
                (2) CERTAIN PERMANENT RESIDENT ALIENS- An alien who--
                    (A) is lawfully admitted to the United States for
                  permanent residence under the Immigration and Nationality
                  Act; and
                    (B)(i) has worked 40 qualifying quarters of coverage as
                  defined under title II of the Social Security Act or can be
                  credited with such qualifying quarters as provided under
                  section 435, and (ii) in the case of any such qualifying
                  quarter creditable for any period beginning after December
                  31, 1996, did not receive any Federal means-tested public
                  benefit (as provided under section 403) during any such
                  period.
                (3) VETERAN AND ACTIVE DUTY EXCEPTION- An alien who is
              lawfully residing in any State and is--
                    (A) a veteran (as defined in section 101 of title 38,
                  United States Code) with a discharge characterized as an
                  honorable discharge and not on account of alienage,
                    (B) on active duty (other than active duty for training)
                  in the Armed Forces of the United States, or
                    (C) the spouse or unmarried dependent child of an
                  individual described in subparagraph (A) or (B).
                (4) TRANSITION FOR THOSE CURRENTLY RECEIVING BENEFITS- An
              alien who on the date of the enactment of this Act is lawfully
              residing in any State and is receiving benefits on the date of
              the enactment of this Act shall continue to be eligible to
              receive such benefits until January 1, 1997.
               SUBTITLE C--ATTRIBUTION OF INCOME AND AFFIDAVITS OF SUPPORT
          SEC. 421. FEDERAL ATTRIBUTION OF SPONSOR'S INCOME AND RESOURCES TO
                            ALIEN.
            (a) IN GENERAL- Notwithstanding any other provision of law, in
          determining the eligibility and the amount of benefits of an alien
          for any Federal means-tested public benefits program (as provided
          under section 403), the income and resources of the alien shall be
          deemed to include the following:
                (1) The income and resources of any person who executed an
              affidavit of support pursuant to section 213A of the 
              Immigration and Nationality Act (as added by section 423) on
              behalf of such alien.
                (2) The income and resources of the spouse (if any) of the
              person.
            (b) DURATION OF ATTRIBUTION PERIOD- Subsection (a) shall apply
          with respect to an alien until such time as the alien--
                (1) achieves United States citizenship through naturalization
              pursuant to chapter 2 of title III of the Immigration and
              Nationality Act; or
                (2)(A) has worked 40 qualifying quarters of coverage as
              defined under title II of the Social Security Act or can be
              credited with such qualifying quarters as provided under 
              section 435, and (B) in the case of any such qualifying quarter
              creditable for any period beginning after December 31, 1996, 
              did not receive any Federal means-tested public benefit (as
              provided under section 403) during any such period.
            (c) REVIEW OF INCOME AND RESOURCES OF ALIEN UPON REAPPLICATION-
          Whenever an alien is required to reapply for benefits under any
          Federal means-tested public benefits program, the applicable agency
          shall review the income and resources attributed to the alien under
          subsection (a).
            (d) APPLICATION- 
                (1) If on the date of the enactment of this Act, a Federal
              means-tested public benefits program attributes a sponsor's
              income and resources to an alien in determining the alien's
              eligibility and the amount of benefits for an alien, this
              section shall apply to any such determination beginning on the
              day after the date of the enactment of this Act.
                (2) If on the date of the enactment of this Act, a Federal
              means-tested public benefits program does not attribute a
              sponsor's income and resources to an alien in determining the
              alien's eligibility and the amount of benefits for an alien,
              this section shall apply to any such determination beginning 
              180 days after the date of the enactment of this Act.
          SEC. 422. AUTHORITY FOR STATES TO PROVIDE FOR ATTRIBUTION OF
                            SPONSORS INCOME AND RESOURCES TO THE ALIEN WITH
                            RESPECT TO STATE PROGRAMS.
            (a) OPTIONAL APPLICATION TO STATE PROGRAMS- Except as provided in
          subsection (b), in determining the eligibility and the amount of
          benefits of an alien for any State public benefits (as defined in
          section 412(c)), the State or political subdivision that offers the
          benefits is authorized to provide that the income and resources of
          the alien shall be deemed to include--
                (1) the income and resources of any individual who executed 
              an affidavit of support pursuant to section 213A of the
              Immigration and Nationality Act (as added by section 423) on
              behalf of such alien, and
                (2) the income and resources of the spouse (if any) of the
              individual.
            (b) EXCEPTIONS- Subsection (a) shall not apply with respect to 
          the following State public benefits:
                (1) Assistance described in section 411(b)(1).
                (2) Short-term, non-cash, in-kind emergency disaster relief.
                (3) Programs comparable to assistance or benefits under the
              National School Lunch Act.
                (4) Programs comparable to assistance or benefits under the
              Child Nutrition Act of 1966.
                (5) Public health assistance for immunizations with respect 
              to immunizable diseases and for testing and treatment of
              symptoms of communicable diseases whether or not such symptoms
              are caused by a communicable disease.
                (6) Payments for foster care and adoption assistance.
                (7) Programs, services, or assistance (such as soup kitchens,
              crisis counseling and intervention, and short-term shelter)
              specified by the Attorney General of a State, after 
              consultation with appropriate agencies and departments, which
              (A) deliver in-kind services at the community level, including
              through public or private nonprofit agencies; (B) do not
              condition the provision of assistance, the amount of assistance
              provided, or the cost of assistance provided on the individual
              recipient's income or resources; and (C) are necessary for the
              protection of life or safety.
          SEC. 423. REQUIREMENTS FOR SPONSOR'S AFFIDAVIT OF SUPPORT.
            (a) IN GENERAL- Title II of the Immigration and Nationality Act 
          is amended by inserting after section 213 the following new section:
                    `REQUIREMENTS FOR SPONSOR'S AFFIDAVIT OF SUPPORT
            `SEC. 213A. (a) ENFORCEABILITY- (1) No affidavit of support may 
          be accepted by the Attorney General or by any consular officer to
          establish that an alien is not excludable as a public charge under
          section 212(a)(4) unless such affidavit is executed as a contract--
                `(A) which is legally enforceable against the sponsor by the
              sponsored alien, the Federal Government, and by any State (or
              any political subdivision of such State) which provides any
              means-tested public benefits program, but not later than 10
              years after the alien last receives any such benefit;
                `(B) in which the sponsor agrees to financially support the
              alien, so that the alien will not become a public charge; and
                `(C) in which the sponsor agrees to submit to the 
              jurisdiction of any Federal or State court for the purpose of
              actions brought under subsection (e)(2).
            `(2) A contract under paragraph (1) shall be enforceable with
          respect to benefits provided to the alien until such time as the
          alien achieves United States citizenship through naturalization
          pursuant to chapter 2 of title III.
            `(b) FORMS- Not later than 90 days after the date of enactment of
          this section, the Attorney General, in consultation with the
          Secretary of State and the Secretary of Health and Human Services,
          shall formulate an affidavit of support consistent with the
          provisions of this section.
            `(c) REMEDIES- Remedies available to enforce an affidavit of
          support under this section include any or all of the remedies
          described in section 3201, 3203, 3204, or 3205 of title 28, United
          States Code, as well as an order for specific performance and
          payment of legal fees and other costs of collection, and include
          corresponding remedies available under State law. A Federal agency
          may seek to collect amounts owed under this section in accordance
          with the provisions of subchapter II of chapter 37 of title 31,
          United States Code.
            `(d) NOTIFICATION OF CHANGE OF ADDRESS- 
                `(1) IN GENERAL- The sponsor shall notify the Attorney 
              General and the State in which the sponsored alien is currently
              resident within 30 days of any change of address of the sponsor
              during the period specified in subsection (a)(2).
                `(2) PENALTY- Any person subject to the requirement of
              paragraph (1) who fails to satisfy such requirement shall be
              subject to a civil penalty of--
                    `(A) not less than $250 or more than $2,000, or
                    `(B) if such failure occurs with knowledge that the alien
                  has received any means-tested public benefit, not less than
                  $2,000 or more than $5,000.
            `(e) REIMBURSEMENT OF GOVERNMENT EXPENSES- (1)(A) Upon
          notification that a sponsored alien has received any benefit under
          any means-tested public benefits program, the appropriate Federal,
          State, or local official shall request reimbursement by the sponsor
          in the amount of such assistance.
            `(B) The Attorney General, in consultation with the Secretary of
          Health and Human Services, shall prescribe such regulations as may
          be necessary to carry out subparagraph (A).
            `(2) If within 45 days after requesting reimbursement, the
          appropriate Federal, State, or local agency has not received a
          response from the sponsor indicating a willingness to commence
          payments, an action may be brought against the sponsor pursuant to
          the affidavit of support.
            `(3) If the sponsor fails to abide by the repayment terms
          established by such agency, the agency may, within 60 days of such
          failure, bring an action against the sponsor pursuant to the
          affidavit of support.
            `(4) No cause of action may be brought under this subsection 
          later than 10 years after the alien last received any benefit under
          any means-tested public benefits program.
            `(5) If, pursuant to the terms of this subsection, a Federal,
          State, or local agency requests reimbursement from the sponsor in
          the amount of assistance provided, or brings an action against the
          sponsor pursuant to the affidavit of support, the appropriate 
          agency may appoint or hire an individual or other person to act on
          behalf of such agency acting under the authority of law for 
          purposes of collecting any moneys owed. Nothing in this subsection
          shall preclude any appropriate Federal, State, or local agency from
          directly requesting reimbursement from a sponsor for the amount of
          assistance provided, or from bringing an action against a sponsor
          pursuant to an affidavit of support.
            `(f) DEFINITIONS- For the purposes of this section--
                `(1) SPONSOR- The term `sponsor' means an indi-vidual who--
                    `(A) is a citizen or national of the United States or an
                  alien who is lawfully admitted to the United States for
                  permanent residence;
                    `(B) is 18 years of age or over;
                    `(C) is domiciled in any of the 50 States or the District
                  of Columbia; and
                    `(D) is the person petitioning for the admission of the
                  alien under section 204.'.
            (b) CLERICAL AMENDMENT- The table of contents of such Act is
          amended by inserting after the item relating to section 213 the
          following:
          `Sec. 213A. Requirements for sponsor's affidavit of support.'.
            (c) EFFECTIVE DATE- Subsection (a) of section 213A of the
          Immigration and Nationality Act, as inserted by subsection (a) of
          this section, shall apply to affidavits of support executed on or
          after a date specified by the Attorney General, which date shall be
          not earlier than 60 days (and not later than 90 days) after the 
          date the Attorney General formulates the form for such affidavits
          under subsection (b) of such section.
            (d) BENEFITS NOT SUBJECT TO REIMBURSEMENT- Requirements for
          reimbursement by a sponsor for benefits provided to a sponsored
          alien pursuant to an affidavit of support under section 213A of the
          Immigration and Nationality Act shall not apply with respect to the
          following:
                (1) Medical assistance described in section 401(b)(1)(A) or
              assistance described in section 411(b)(1).
                (2) Short-term, non-cash, in-kind emergency disaster relief.
                (3) Assistance or benefits under the National School Lunch Act.
                (4) Assistance or benefits under the Child Nutrition Act of
              1966.
                (5) Public health assistance for immunizations (not including
              any assistance under title XIX of the Social Security Act) with
              respect to immunizable diseases and for testing and treatment 
              of symptoms of communicable diseases whether or not such
              symptoms are caused by a communicable disease.
                (6) Payments for foster care and adoption assistance under
              parts B and E of title IV of the Social Security Act for a
              parent or a child, but only if the foster or adoptive parent 
              (or parents) of such child is a qualified alien (as defined in
              section 431).
                (7) Programs, services, or assistance (such as soup kitchens,
              crisis counseling and intervention, and short-term shelter)
              specified by the Attorney General, in the Attorney General's
              sole and unreviewable discretion after consultation with
              appropriate Federal agencies and departments, which (A) deliver
              in-kind services at the community level, including through
              public or private nonprofit agencies; (B) do not condition the
              provision of assistance, the amount of assistance provided, or
              the cost of assistance provided on the individual recipient's
              income or resources; and (C) are necessary for the protection 
              of life or safety.
                (8) Programs of student assistance under titles IV, V, IX, 
              and X of the Higher Education Act of 1965, and titles III, VII,
              and VIII of the Public Health Service Act.
                (9) Benefits under the Head Start Act.
                (10) Means-tested programs under the Elementary and Secondary
              Education Act of 1965.
                (11) Benefits under the Job Training Partnership Act.
                    [BOLD->] SUBTITLE D--GENERAL PROVISIONS [<-BOLD] 
          SEC. 431. DEFINITIONS.
            (a) IN GENERAL- Except as otherwise provided in this title, the
          terms used in this title have the same meaning given such terms in
          section 101(a) of the Immigration and Nationality Act.
            (b) QUALIFIED ALIEN- For purposes of this title, the term
          `qualified alien' means an alien who, at the time the alien applies
          for, receives, or attempts to receive a Federal public benefit, is--
                (1) an alien who is lawfully admitted for permanent residence
              under the Immigration and Nationality Act,
                (2) an alien who is granted asylum under section 208 of such
              Act,
                (3) a refugee who is admitted to the United States under
              section 207 of such Act,
                (4) an alien who is paroled into the United States under
              section 212(d)(5) of such Act for a period of at least 1 year,
                (5) an alien whose deportation is being withheld under 
              section 243(h) of such Act, or
                (6) an alien who is granted conditional entry pursuant to
              section 203(a)(7) of such Act as in effect prior to April 1,
              1980.
          SEC. 432. VERIFICATION OF ELIGIBILITY FOR FEDERAL PUBLIC BENEFITS.
            (a) IN GENERAL- Not later than 18 months after the date of the
          enactment of this Act, the Attorney General of the United States,
          after consultation with the Secretary of Health and Human Services,
          shall promulgate regulations requiring verification that a person
          applying for a Federal public benefit (as defined in section
          401(c)), to which the limitation under section 401 applies, is a
          qualified alien and is eligible to receive such benefit. Such
          regulations shall, to the extent feasible, require that information
          requested and exchanged be similar in form and manner to 
          information requested and exchanged under section 1137 of the 
          Social Security Act.
            (b) STATE COMPLIANCE- Not later than 24 months after the date the
          regulations described in subsection (a) are adopted, a State that
          administers a program that provides a Federal public benefit shall
          have in effect a verification system that complies with the
          regulations.
            (c) AUTHORIZATION OF APPROPRIATIONS- There are authorized to be
          appropriated such sums as may be necessary to carry out the purpose
          of this section.
          SEC. 433. STATUTORY CONSTRUCTION.
            (a) LIMITATION- 
                (1) Nothing in this title may be construed as an entitlement
              or a determination of an individual's eligibility or 
              fulfillment of the requisite requirements for any Federal,
              State, or local governmental program, assistance, or benefits.
              For purposes of this title, eligibility relates only to the
              general issue of eligibility or ineligibility on the basis of
              alienage.
                (2) Nothing in this title may be construed as addressing 
              alien eligibility for a basic public education as determined by
              the Supreme Court of the United States under Plyler v. Doe (457
              U.S. 202)(1982).
            (b) NOT APPLICABLE TO FOREIGN ASSISTANCE- This title does not
          apply to any Federal, State, or local governmental program,
          assistance, or benefits provided to an alien under any program of
          foreign assistance as determined by the Secretary of State in
          consultation with the Attorney General.
            (c) SEVERABILITY- If any provision of this title or the
          application of such provision to any person or circumstance is held
          to be unconstitutional, the remainder of this title and the
          application of the provisions of such to any person or circumstance
          shall not be affected thereby.
          SEC. 434. COMMUNICATION BETWEEN STATE AND LOCAL GOVERNMENT AGENCIES
                            AND THE IMMIGRATION AND NATURALIZATION SERVICE.
            Notwithstanding any other provision of Federal, State, or local
          law, no State or local government entity may be prohibited, or in
          any way restricted, from sending to or receiving from the
          Immigration and Naturalization Service information regarding the
          immigration status, lawful or unlawful, of an alien in the United
          States.
          SEC. 435. QUALIFYING QUARTERS.
            For purposes of this title, in determining the number of
          qualifying quarters of coverage under title II of the Social
          Security Act an alien shall be credited with--
                (1) all of the qualifying quarters of coverage as defined
              under title II of the Social Security Act worked by a parent of
              such alien while the alien was under age 18, and
                (2) all of the qualifying quarters worked by a spouse of such
              alien during their marriage and the alien remains married to
              such spouse or such spouse is deceased.
          No such qualifying quarter of coverage that is creditable under
          title II of the Social Security Act for any period beginning after
          December 31, 1996, may be credited to an alien under paragraph (1)
          or (2) if the parent or spouse (as the case may be) of such alien
          received any Federal means-tested public benefit (as provided under
          section 403) during the period for which such qualifying quarter of
          coverage is so credited.
             SUBTITLE E--CONFORMING AMENDMENTS RELATING TO ASSISTED HOUSING
          SEC. 441. CONFORMING AMENDMENTS RELATING TO ASSISTED HOUSING.
            (a) LIMITATIONS ON ASSISTANCE- Section 214 of the Housing and
          Community Development Act of 1980 (42 U.S.C. 1436a) is amended--
                (1) by striking `Secretary of Housing and Urban Development'
              each place it appears and inserting `applicable Secretary';
                (2) in subsection (b), by inserting after `National Housing
              Act,' the following: `the direct loan program under section 502
              of the Housing Act of 1949 or section 502(c)(5)(D), 504,
              521(a)(2)(A), or 542 of such Act, subtitle A of title III of 
              the Cranston-Gonzalez National Affordable Housing Act,';
                (3) in paragraphs (2) through (6) of subsection (d), by
              striking `Secretary' each place it appears and inserting
              `applicable Secretary';
                (4) in subsection (d), in the matter following paragraph (6),
              by striking `the term `Secretary' and inserting `the term
              `applicable Secretary'; and
                (5) by adding at the end the following new subsection:
            `(h) For purposes of this section, the term `applicable 
          Secretary' means--
                `(1) the Secretary of Housing and Urban Development, with
              respect to financial assistance administered by such Secretary
              and financial assistance under subtitle A of title III of the
              Cranston-Gonzalez National Affordable Housing Act; and
                `(2) the Secretary of Agriculture, with respect to financial
              assistance administered by such Secretary.'.
            (b) CONFORMING AMENDMENTS- Section 501(h) of the Housing Act of
          1949 (42 U.S.C. 1471(h)) is amended--
                (1) by striking `(1)';
                (2) by striking `by the Secretary of Housing and Urban
              Development'; and
                (3) by striking paragraph (2).
             [BOLD->] SUBTITLE F--EARNED INCOME CREDIT DENIED TO UNAUTHORIZED
                                   EMPLOYEES [<-BOLD]
          SEC. 451. EARNED INCOME CREDIT DENIED TO INDIVIDUALS NOT AUTHORIZED
                            TO BE EMPLOYED IN THE UNITED STATES.
            (a) IN GENERAL- Section 32(c)(1) of the Internal Revenue Code of
          1986 (relating to individuals eligible to claim the earned income
          credit) is amended by adding at the end the following new
          subparagraph:
                    `(F) IDENTIFICATION NUMBER REQUIREMENT- The term 
                  `eligible individual' does not include any individual who
                  does not include on the return of tax for the taxable year--
                        `(i) such individual's taxpayer identification 
                      number, and
                        `(ii) if the individual is married (within the 
                      meaning of section 7703), the taxpayer identification
                      number of such individual's spouse.'.
            (b) SPECIAL IDENTIFICATION NUMBER- Section 32 of such Code is
          amended by adding at the end the following new subsection:
            `(l) IDENTIFICATION NUMBERS- Solely for purposes of subsections
          (c)(1)(F) and (c)(3)(D), a taxpayer identification number means a
          social security number issued to an individual by the Social
          Security Administration (other than a social security number issued
          pursuant to clause (II) (or that portion of clause (III) that
          relates to clause (II)) of section 205(c)(2)(B)(i) of the Social
          Security Act).'.
            (c) EXTENSION OF PROCEDURES APPLICABLE TO MATHEMATICAL OR 
          CLERICAL ERRORS- Section 6213(g)(2) of such Code (relating to the
          definition of mathematical or clerical errors) is amended by
          striking `and' at the end of subparagraph (D), by striking the
          period at the end of subparagraph (E) and inserting a comma, and by
          inserting after subparagraph (E) the following new subparagraphs:
                    `(F) an omission of a correct taxpayer identification
                  number required under section 32 (relating to the earned
                  income credit) to be included on a return, and
                    `(G) an entry on a return claiming the credit under
                  section 32 with respect to net earnings from 
                  self-employment described in section 32(c)(2)(A) to the
                  extent the tax imposed by section 1401 (relating to
                  self-employment tax) on such net earnings has not been
                  paid.'.
            (d) EFFECTIVE DATE- The amendments made by this section shall
          apply with respect to returns the due date for which (without 
          regard to extensions) is more than 30 days after the date of the
          enactment of this Act.
                                TITLE V--CHILD PROTECTION
          SEC. 501. AUTHORITY OF STATES TO MAKE FOSTER CARE MAINTENANCE
                            PAYMENTS ON BEHALF OF CHILDREN IN ANY PRIVATE
                            CHILD CARE INSTITUTION.
            Section 472(c)(2) of the Social Security Act (42 U.S.C. 
          672(c)(2)) is amended by striking `nonprofit'.
          SEC. 502. EXTENSION OF ENHANCED MATCH FOR IMPLEMENTATION OF
                            STATEWIDE AUTOMATED CHILD WELFARE INFORMATION
                            SYSTEMS.
            Section 13713(b)(2) of the Omnibus Budget Reconciliation Act of
          1993 (42 U.S.C. 674 note; 107 Stat. 657) is amended by striking
          `1996' and inserting `1997'.
          SEC. 503. NATIONAL RANDOM SAMPLE STUDY OF CHILD WELFARE.
            Part B of title IV of the Social Security Act (42 U.S.C. 
          620-628a) is amended by adding at the end the following:
          `SEC. 429A. NATIONAL RANDOM SAMPLE STUDY OF CHILD WELFARE.
            `(a) IN GENERAL- The Secretary shall conduct a national study
          based on random samples of children who are at risk of child abuse
          or neglect, or are determined by States to have been abused or
          neglected.
            `(b) REQUIREMENTS- The study required by subsection (a) shall--
                `(1) have a longitudinal component; and
                `(2) yield data reliable at the State level for as many 
              States as the Secretary determines is feasible.
            `(c) PREFERRED CONTENTS- In conducting the study required by
          subsection (a), the Secretary should--
                `(1) carefully consider selecting the sample from cases of
              confirmed abuse or neglect; and
                `(2) follow each case for several years while obtaining
              information on, among other things--
                    `(A) the type of abuse or neglect involved;
                    `(B) the frequency of contact with State or local agencies;
                    `(C) whether the child involved has been separated from
                  the family, and, if so, under what circumstances;
                    `(D) the number, type, and characteristics of out-of-home
                  placements of the child; and
                    `(E) the average duration of each placement.
            `(d) REPORTS- 
                `(1) IN GENERAL- From time to time, the Secretary shall
              prepare reports summarizing the results of the study required 
              by subsection (a).
                `(2) AVAILABILITY- The Secretary shall make available to the
              public any report prepared under paragraph (1), in writing or 
              in the form of an electronic data tape.
                `(3) AUTHORITY TO CHARGE FEE- The Secretary may charge and
              collect a fee for the furnishing of reports under para-graph (2).
            `(e) APPROPRIATION- Out of any money in the Treasury of the 
          United States not otherwise appropriated, there are appropriated to
          the Secretary for each of fiscal years 1996 through 2002 $6,000,000
          to carry out this section.'.
          SEC. 504. REDESIGNATION OF SECTION 1123.
            The Social Security Act is amended by redesignating sec-tion 
          1123, the second place it appears (42 U.S.C. 1320a-1a), as section
          1123A.
          SEC. 505. KINSHIP CARE.
            Section 471(a) of the Social Security Act (42 U.S.C. 671(a)) is
          amended--
                (1) by striking `and' at the end of paragraph (16);
                (2) by striking the period at the end of paragraph (17) and
              inserting `; and'; and
                (3) by adding at the end the following:
                `(18) provides that the State shall consider giving 
              preference to an adult relative over a non-related caregiver
              when determining a placement for a child, provided that the
              relative caregiver meets all relevant State child protection
              standards.'.
                                  TITLE VI--CHILD CARE
          SEC. 601. SHORT TITLE AND REFERENCES.
            (a) SHORT TITLE- This title may be cited as the `Child Care and
          Development Block Grant Amendments of 1996'.
            (b) REFERENCES- Except as otherwise expressly provided, whenever
          in this title an amendment or repeal is expressed in terms of an
          amendment to, or repeal of, a section or other provision, the
          reference shall be considered to be made to a section or other
          provision of the Child Care and Development Block Grant Act of 1990
          (42 U.S.C. 9858 et seq.).
          SEC. 602. GOALS.
            Section 658A (42 U.S.C. 9801 note) is amended--
                (1) in the section heading by inserting `AND GOALS' after
              `TITLE';
                (2) by inserting `(a) SHORT TITLE- ' before `This'; and
                (3) by adding at the end the following:
            `(b) GOALS- The goals of this subchapter are--
                `(1) to allow each State maximum flexibility in developing
              child care programs and policies that best suit the needs of
              children and parents within such State;
                `(2) to promote parental choice to empower working parents to
              make their own decisions on the child care that best suits 
              their family's needs;
                `(3) to encourage States to provide consumer education
              information to help parents make informed choices about child
              care;
                `(4) to assist States to provide child care to parents t
              rying  to achieve independence from public assistance; and
                `(5) to assist States in implementing the health, safety,
              licensing, and registration standards established in State
              regulations.'.
          SEC. 603. AUTHORIZATION OF APPROPRIATIONS AND ENTITLEMENT AUTHORITY.
            (a) IN GENERAL- Section 658B (42 U.S.C. 9858) is amended to read
          as follows:
          `SEC. 658B. AUTHORIZATION OF APPROPRIATIONS.
            `There is authorized to be appropriated to carry out this
          subchapter $1,000,000,000 for each of the fiscal years 1996 through
          2002.'.
            (b) SOCIAL SECURITY ACT- Part A of title IV of the Social 
          Security Act (42 U.S.C. 601-617) is amended by adding at the end 
          the following new section:
          `SEC. 418. FUNDING FOR CHILD CARE.
            `(a) GENERAL CHILD CARE ENTITLEMENT- 
                `(1) GENERAL ENTITLEMENT- Subject to the amount appropriated
              under paragraph (3), each State shall, for the purpose of
              providing child care assistance, be entitled to payments under 
              a grant under this subsection for a fiscal year in an amount
              equal to--
                    `(A) the sum of the total amount required to be paid to
                  the State under section 403 for fiscal year 1994 or 1995
                  (whichever is greater) with respect to amounts expended for
                  child care under section--
                        `(i) 402(g) of this Act (as such section was in 
                      effect before October 1, 1995); and
                        `(ii) 402(i) of this Act (as so in effect); or
                    `(B) the average of the total amounts required to be paid
                  to the State for fiscal years 1992 through 1994 under the
                  sections referred to in subparagraph (A);
              whichever is greater.
                `(2) REMAINDER- 
                    `(A) GRANTS- The Secretary shall use any amounts
                  appropriated for a fiscal year under paragraph (3), and
                  remaining after the reservation described in paragraph (4)
                  and after grants are awarded under paragraph (1), to make
                  grants to States under this paragraph.
                    `(B) AMOUNT- Subject to subparagraph (C), the amount of a
                  grant awarded to a State for a fiscal year under this
                  paragraph shall be based on the formula used for 
                  determining the amount of Federal payments to the State
                  under section 403(n) (as such section was in effect before
                  October 1, 1995).
                    `(C) MATCHING REQUIREMENT- The Secretary shall pay to 
                  each eligible State in a fiscal year an amount, under a
                  grant under subparagraph (A), equal to the Federal medical
                  assistance percentage for such State for fiscal year 1995
                  (as defined in section 1905(b)) of so much of the
                  expenditures by the State for child care in such year as
                  exceed the State set-aside for such State under paragraph
                  (1)(A) for such year and the amount of State expenditures 
                  in fiscal year 1994 or 1995 (whichever is greater) that
                  equal the non-Federal share for the programs described in
                  subparagraph (A) of paragraph (1).
                    `(D) REDISTRIBUTION- 
                        `(i) IN GENERAL- With respect to any fiscal year, if
                      the Secretary determines (in accordance with clause
                      (ii)) that amounts under any grant awarded to a State
                      under this paragraph for such fiscal year will not be
                      used by such State during such fiscal year for carrying
                      out the purpose for which the grant is made, the
                      Secretary shall make such amounts available in the
                      subsequent fiscal year for carrying out such purpose to
                      one or more States which apply for such funds to the
                      extent the Secretary determines that such States will 
                      be able to use such additional amounts for carrying out
                      such purpose. Such available amounts shall be
                      redistributed to a State pursuant to section 403(n) (as
                      such section was in effect before October 1, 1995) by
                      substituting `the number of children residing in all
                      States applying for such funds' for `the number of
                      children residing in the United States in the second
                      preceding fiscal year'.
                        `(ii) TIME OF DETERMINATION AND DISTRIBUTION- The
                      determination of the Secretary under clause (i) for a
                      fiscal year shall be made not later than the end of the
                      first quarter of the subsequent fiscal year. The
                      redistribution of amounts under clause (i) shall be 
                      made as close as practicable to the date on which such
                      determination is made. Any amount made available to a
                      State from an appropriation for a fiscal year in
                      accordance with this subparagraph shall, for purposes 
                      of this part, be regarded as part of such State's
                      payment (as determined under this subsection) for the
                      fiscal year in which the redistribution is made.
                `(3) APPROPRIATION- For grants under this section, there are
              appropriated--
                    `(A) $1,967,000,000 for fiscal year 1997;
                    `(B) $2,067,000,000 for fiscal year 1998;
                    `(C) $2,167,000,000 for fiscal year 1999;
                    `(D) $2,367,000,000 for fiscal year 2000;
                    `(E) $2,567,000,000 for fiscal year 2001; and
                    `(F) $2,717,000,000 for fiscal year 2002.
                `(4) INDIAN TRIBES- The Secretary shall reserve not less than
              1 percent, and not more than 2 percent, of the aggregate amount
              appropriated to carry out this section in each fiscal year for
              payments to Indian tribes and tribal organizations.
            `(b) USE OF FUNDS- 
                `(1) IN GENERAL- Amounts received by a State under this
              section shall only be used to provide child care assistance.
              Amounts received by a State under a grant under subsection
              (a)(1) shall be available for use by the State without fiscal
              year limitation.
                `(2) USE FOR CERTAIN POPULATIONS- A State shall ensure that
              not less than 70 percent of the total amount of funds received
              by the State in a fiscal year under this section are used to
              provide child care assistance to families who are receiving
              assistance under a State program under this part, families who
              are attempting through work activities to transition off of 
              such assistance program, and families who are at risk of
              becoming dependent on such assistance program.
            `(c) APPLICATION OF CHILD CARE AND DEVELOPMENT BLOCK GRANT ACT of
          1990- Notwithstanding any other provision of law, amounts provided
          to a State under this section shall be transferred to the lead
          agency under the Child Care and Development Block Grant Act of 
          1990, integrated by the State into the programs established by the
          State under such Act, and be subject to requirements and 
          limitations of such Act.
            `(d) DEFINITION- As used in this section, the term `State' means
          each of the 50 States or the District of Columbia.'.
          SEC. 604. LEAD AGENCY.
            Section 658D(b) (42 U.S.C. 9858b(b)) is amended--
                (1) in paragraph (1)--
                    (A) in subparagraph (A), by striking `State' the first
                  place that such appears and inserting `governmental or
                  nongovernmental'; and
                    (B) in subparagraph (C), by inserting `with sufficient
                  time and Statewide distribution of the notice of such
                  hearing,' after `hearing in the State'; and
                (2) in paragraph (2), by striking the second sentence.
          SEC. 605. APPLICATION AND PLAN.
            Section 658E (42 U.S.C. 9858c) is amended--
                (1) in subsection (b)--
                    (A) by striking `implemented--' and all that follows
                  through `(2)' and inserting `implemented'; and
                    (B) by striking `for subsequent State plans';
                (2) in subsection (c)--
                    (A) in paragraph (2)--
                        (i) in subparagraph (A)--
            (I) in clause (i) by striking `, other than through assistance
          provided under paragraph (3)(C),'; and
            (II) by striking `except' and all that follows through `1992', 
          and inserting `and provide a detailed description of the procedures
          the State will implement to carry out the requirements of this
          subparagraph';
                        (ii) in subparagraph (B)--
            (I) by striking `Provide assurances' and inserting `Certify'; and
            (II) by inserting before the period at the end `and provide a
          detailed description of such procedures';
                        (iii) in subparagraph (C)--
            (I) by striking `Provide assurances' and inserting `Certify'; and
            (II) by inserting before the period at the end `and provide a
          detailed description of how such record is maintained and is made
          available';
                        (iv) by amending subparagraph (D) to read as follows:
                    `(D) CONSUMER EDUCATION INFORMATION- Certify that the
                  State will collect and disseminate to parents of eligible
                  children and the general public, consumer education
                  information that will promote informed child care choices.';
                        (v) in subparagraph (E), to read as follows:
                    `(E) COMPLIANCE WITH STATE LICENSING REQUIREMENTS- 
                        `(i) IN GENERAL- Certify that the State has in effect
                      licensing requirements applicable to child care 
                      services provided within the State, and provide a
                      detailed description of such requirements and of how
                      such requirements are effectively enforced. Nothing in
                      the preceding sentence shall be construed to require
                      that licensing requirements be applied to specific 
                      types of providers of child care services.
                        `(ii) INDIAN TRIBES AND TRIBAL ORGANIZATIONS- In lieu
                      of any licensing and regulatory requirements applicable
                      under State and local law, the Secretary, in
                      consultation with Indian tribes and tribal
                      organizations, shall develop minimum child care
                      standards (that appropriately reflect tribal needs and
                      available resources) that shall be applicable to Indian
                      tribes and tribal organization receiving assistance
                      under this subchapter.';
                        (vi) in subparagraph (F) by striking `Provide
                      assurances' and inserting `Certify';
                        (vii) in subparagraph (G) by striking `Provide
                      assurances' and inserting `Certify'; and
                        (viii) by striking subparagraphs (H), (I), and (J) 
                      and inserting the following:
                    `(H) MEETING THE NEEDS OF CERTAIN POPULATIONS- 
                  Demonstrate the manner in which the State will meet the
                  specific child care needs of families who are receiving
                  assistance under a State program under part A of title IV 
                  of the Social Security Act, families who are attempting
                  through work activities to transition off of such 
                  assistance program, and families that are at risk of
                  becoming dependent on such assistance program.';
                    (B) in paragraph (3)--
                        (i) in subparagraph (A), by striking `(B) and (C)' 
                      and inserting `(B) through (D)';
                        (ii) in subparagraph (B)--
            (I) by striking `- Subject to the reservation contained in
          subparagraph (C), the' and inserting `AND RELATED ACTIVITIES- The';
            (II) in clause (i) by striking `; and' at the end and inserting a
          period;
            (III) by striking `for--' and all that follows through `section
          658E(c)(2)(A)' and inserting `for child care services on a sliding
          fee scale basis, activities that improve the quality or 
          availability of such services, and any other activity that the 
          State deems appropriate to realize any of the goals specified in
          paragraphs (2) through (5) of section 658A(b)'; and
            (IV) by striking clause (ii);
                        (iii) by amending subparagraph (C) to read as follows:
                    `(C) LIMITATION ON ADMINISTRATIVE COSTS- Not more than 5
                  percent of the aggregate amount of funds available to the
                  State to carry out this subchapter by a State in each 
                  fiscal year may be expended for administrative costs
                  incurred by such State to carry out all of its functions 
                  and duties under this subchapter. As used in the preceding
                  sentence, the term `administrative costs' shall not include
                  the costs of providing direct services.';  and
                        (iv) by adding at the end thereof the following:
                    `(D) ASSISTANCE FOR CERTAIN FAMILIES- A State shall 
                  ensure that a substantial portion of the amounts available
                  (after the State has complied with the requirement of
                  section 418(b)(2) of the Social Security Act with respect 
                  to each of the fiscal years 1997 through 2002) to the State
                  to carry out activities under this subchapter in each 
                  fiscal year is used to provide assistance to low-income
                  working families other than families described in paragraph
                  (2)(H).'; and
                    (C) in paragraph (4)(A)--
                        (i) by striking `provide assurances' and inserting
                      `certify';
                        (ii) in the first sentence by inserting `and shall
                      provide a summary of the facts relied on by the State 
                      to determine that such rates are sufficient to ensure
                      such access' before the period; and
                        (iii) by striking the last sentence.
          SEC. 606. LIMITATION ON STATE ALLOTMENTS.
            Section 658F(b)(1) (42 U.S.C. 9858d(b)(1)) is amended by striking
          `No' and inserting `Except as provided for in section 658O(c)(6),
          no'.
          SEC. 607. ACTIVITIES TO IMPROVE THE QUALITY OF CHILD CARE.
            Section 658G (42 U.S.C. 9858e) is amended to read as follows:
          `SEC. 658G. ACTIVITIES TO IMPROVE THE QUALITY OF CHILD CARE.
            `A State that receives funds to carry out this subchapter for a
          fiscal year, shall use not less than 4 percent of the amount of 
          such funds for activities that are designed to provide 
          comprehensive consumer education to parents and the public,
          activities that increase parental choice, and activities designed 
          to improve the quality and availability of child care (such as
          resource and referral services).'.
          SEC. 608. REPEAL OF EARLY CHILDHOOD DEVELOPMENT AND BEFORE- AND
                            AFTER-SCHOOL CARE REQUIREMENT.
            Section 658H (42 U.S.C. 9858f) is repealed.
          SEC. 609. ADMINISTRATION AND ENFORCEMENT.
            Section 658I(b) (42 U.S.C. 9858g(b)) is amended--
                (1) in paragraph (1), by striking `, and shall have' and all
              that follows through `(2)'; and
                (2) in the matter following clause (ii) of paragraph (2)(A),
              by striking `finding and that' and all that follows through the
              period and inserting `finding and shall require that the State
              reimburse the Secretary for any funds that were improperly
              expended for purposes prohibited or not authorized by this
              subchapter, that the Secretary deduct from the administrative
              portion of the State allotment for the following fiscal year an
              amount that is less than or equal to any improperly expended
              funds, or a combination of such options.'.
          SEC. 610. PAYMENTS.
            Section 658J(c) (42 U.S.C. 9858h(c)) is amended--
                (1) by striking `expended' and inserting `obligated'; and
                (2) by striking `3 fiscal years' and inserting `fiscal year'.
          SEC. 611. ANNUAL REPORT AND AUDITS.
            Section 658K (42 U.S.C. 9858i) is amended--
                (1) in the section heading by striking `ANNUAL REPORT' and
              inserting `REPORTS';
                (2) in subsection (a), to read as follows:
            `(a) REPORTS- 
                `(1) COLLECTION OF INFORMATION BY STATES- 
                    `(A) IN GENERAL- A State that receives funds to carry out
                  this subchapter shall collect the information described in
                  subparagraph (B) on a monthly basis.
                    `(B) REQUIRED INFORMATION- The information required under
                  this subparagraph shall include, with respect to a family
                  unit receiving assistance under this subchapter information
                  concerning--
                        `(i) family income;
                        `(ii) county of residence;
                        `(iii) the gender, race, and age of children 
                      receiving such assistance;
                        `(iv) whether the family includes only one parent;
                        `(v) the sources of family income, including the
                      amount obtained from (and separately identified)--
            `(I) employment, including self-employment;
            `(II) cash or other assistance under part A of title IV of the
          Social Security Act;
            `(III) housing assistance;
            `(IV) assistance under the Food Stamp Act of 1977; and
            `(V) other assistance programs;
                        `(vi) the number of months the family has received
                      benefits;
                        `(vii) the type of child care in which the child was
                      enrolled (such as family child care, home care, or
                      center-based child care);
                        `(viii) whether the child care provider involved was 
                      a relative;
                        `(ix) the cost of child care for such families; and
                        `(x) the average hours per week of such care;
                  during the period for which such information is required to
                  be submitted.
                    `(C) SUBMISSION TO SECRETARY- A State described in
                  subparagraph (A) shall, on a quarterly basis, submit the
                  information required to be collected under subparagraph (B)
                  to the Secretary.
                    `(D) SAMPLING- The Secretary may disapprove the
                  information collected by a State under this paragraph if 
                  the State uses sampling methods to collect such information.
                `(2) BIANNUAL REPORTS- Not later than December 31, 1997, and
              every 6 months thereafter, a State described in paragraph 
              (1)(A) shall prepare and submit to the Secretary a report that
              includes aggregate data concerning--
                    `(A) the number of child care providers that received
                  funding under this subchapter as separately identified 
                  based on the types of providers listed in section 658P(5);
                    `(B) the monthly cost of child care services, and the
                  portion of such cost that is paid for with assistance
                  provided under this subchapter, listed by the type of child
                  care services provided;
                    `(C) the number of payments made by the State through
                  vouchers, contracts, cash, and disregards under public
                  benefit programs, listed by the type of child care services
                  provided;
                    `(D) the manner in which consumer education information
                  was provided to parents and the number of parents to whom
                  such information was provided; and
                    `(E) the total number (without duplication) of children
                  and families served under this subchapter;
              during the period for which such report is required to be
              sub-mitted.'; and
                (2) in subsection (b)--
                    (A) in paragraph (1) by striking `a application' and
                  inserting `an application';
                    (B) in paragraph (2) by striking `any agency 
                  administering activities that receive' and inserting `the
                  State that receives'; and
                    (C) in paragraph (4) by striking `entitles' and inserting
                  `entitled'.
          SEC. 612. REPORT BY THE SECRETARY.
            Section 658L (42 U.S.C. 9858j) is amended--
                (1) by striking `1993' and inserting `1997';
                (2) by striking `annually' and inserting `biennially'; and
                (3) by striking `Education and Labor' and inserting `Economic
              and Educational Opportunities'.
          SEC. 613. ALLOTMENTS.
            Section 658O (42 U.S.C. 9858m) is amended--
                (1) in subsection (a)--
                    (A) in paragraph (1)--
                        (i) by striking `POSSESSIONS' and inserting
                      `POSSESSIONS';
                        (ii) by inserting `and' after `States,'; and
                        (iii) by striking `, and the Trust Territory of the
                      Pacific Islands'; and
                    (B) in paragraph (2), by striking `more than 3 percent'
                  and inserting `less than 1 percent, and not more than 2
                  percent,';
                (2) in subsection (c)--
                    (A) in paragraph (5) by striking `our' and inserting
                  `out'; and
                    (B) by adding at the end thereof the following new
                  paragraph:
                `(6) CONSTRUCTION OR RENOVATION OF FACILITIES- 
                    `(A) REQUEST FOR USE OF FUNDS- An Indian tribe or tribal
                  organization may submit to the Secretary a request to use
                  amounts provided under this subsection for construction or
                  renovation purposes.
                    `(B) DETERMINATION- With respect to a request submitted
                  under subparagraph (A), and except as provided in
                  subparagraph (C), upon a determination by the Secretary 
                  that adequate facilities are not otherwise available to an
                  Indian tribe or tribal organization to enable such tribe or
                  organization to carry out child care programs in accordance
                  with this subchapter, and that the lack of such facilities
                  will inhibit the operation of such programs in the future,
                  the Secretary may permit the tribe or organization to use
                  assistance provided under this subsection to make payments
                  for the construction or renovation of facilities that will
                  be used to carry out such programs.
                    `(C) LIMITATION- The Secretary may not permit an Indian
                  tribe or tribal organization to use amounts provided under
                  this subsection for construction or renovation if such use
                  will result in a decrease in the level of child care
                  services provided by the tribe or organization as compared
                  to the level of such services provided by the tribe or
                  organization in the fiscal year preceding the year for 
                  which the determination under subparagraph (A) is being made.
                    `(D) UNIFORM PROCEDURES- The Secretary shall develop and
                  implement uniform procedures for the solicitation and
                  consideration of requests under this paragraph.'; and
                (3) in subsection (e), by adding at the end thereof the
              following new paragraph:
                `(4) INDIAN TRIBES OR TRIBAL ORGANIZATIONS- Any portion of a
              grant or contract made to an Indian tribe or tribal 
              organization under subsection (c) that the Secretary determines
              is not being used in a manner consistent with the provision of
              this subchapter in the period for which the grant or contract 
              is made available, shall be allotted by the Secretary to other
              tribes or organizations that have submitted applications under
              subsection (c) in accordance with their respective needs.'.
          SEC. 614. DEFINITIONS.
            Section 658P (42 U.S.C. 9858n) is amended--
                (1) in paragraph (2), in the first sentence by inserting `or
              as a deposit for child care services if such a deposit is
              required of other children being cared for by the provider'
              after `child care services'; and
                (2) by striking paragraph (3);
                (3) in paragraph (4)(B), by striking `75 percent' and
              inserting `85 percent';
                (4) in paragraph (5)(B)--
                    (A) by inserting `great grandchild, sibling (if such
                  provider lives in a separate residence),' after
                  `grandchild,';
                    (B) by striking `is registered and'; and
                    (C) by striking `State' and inserting `applicable'.
                (5) by striking paragraph (10);
                (6) in paragraph (13)--
                    (A) by inserting `or' after `Samoa,'; and
                    (B) by striking `, and the Trust Territory of the Pacific
                  Islands';
                (7) in paragraph (14)--
                    (A) by striking `The term' and inserting the following:
                    `(A) IN GENERAL- The term'; and
                    (B) by adding at the end thereof the following new
                  subparagraph:
                    `(B) OTHER ORGANIZATIONS- Such term includes a Native
                  Hawaiian Organization, as defined in section 4009(4) of the
                  Augustus F. Hawkins-Robert T. Stafford Elementary and
                  Secondary School Improvement Amendments of 1988 (20 U.S.C.
                  4909(4)) and a private nonprofit organization established
                  for the purpose of serving youth who are Indians or Native
                  Hawaiians.'.
          SEC. 615. EFFECTIVE DATE.
            (a) IN GENERAL- Except as provided in subsection (b), this title
          and the amendments made by this title shall take effect on October
          1, 1996.
            (b) EXCEPTION- The amendment made by section 603(a) shall take
          effect on the date of enactment of this Act.
                           TITLE VII--CHILD NUTRITION PROGRAMS
                          SUBTITLE A--NATIONAL SCHOOL LUNCH ACT
          SEC. 701. STATE DISBURSEMENT TO SCHOOLS.
            (a) IN GENERAL- Section 8 of the National School Lunch Act (42
          U.S.C. 1757) is amended--
                (1) in the third sentence, by striking `Nothing' and all that
              follows through `educational agency to' and inserting `The 
              State educational agency may';
                (2) by striking the fourth and fifth sentences;
                (3) by redesignating the first through seventh sentences, as
              amended by paragraph (2), as subsections (a) through (g),
              respectively;
                (4) in subsection (b), as redesignated by paragraph (3), by
              striking `the preceding sentence' and inserting `subsection
              (a)'; and
                (5) in subsection (d), as redesignated by paragraph (3), by
              striking `Such food costs' and inserting `Use of funds paid to
              States'.
            (b) DEFINITION OF CHILD- Section 12(d) of the National School
          Lunch Act (42 U.S.C. 1760(d)) is amended by adding at the end the
          following:
                `(9) CHILD- 
                    `(A) IN GENERAL- The term `child' includes an 
                  indi-vidual, regardless of age, who--
                        `(i) is determined by a State educational agency, in
                      accordance with regulations prescribed by the 
                      Secretary, to have one or more mental or physical
                      disabilities; and
                        `(ii) is attending any institution, as defined in
                      section 17(a), or any nonresidential public or 
                      nonprofit private school of high school grade or under,
                      for the purpose of participating in a school program
                      established for individuals with mental or physical
                      dis-abilities.
                    `(B) RELATIONSHIP TO CHILD AND ADULT CARE FOOD PROGRAM- 
                  No institution that is not otherwise eligible to 
                  participate in the program under section 17 shall be
                  considered eligible because of this paragraph.'.
          SEC. 702. NUTRITIONAL AND OTHER PROGRAM REQUIREMENTS.
            (a) NUTRITIONAL STANDARDS- Section 9(a) of the National School
          Lunch Act (42 U.S.C. 1758(a)) is amended--
                (1) in paragraph (2)--
                    (A) by striking `(2)(A) Lunches' and inserting `(2)
                  Lunches';
                    (B) by striking subparagraph (B); and
                    (C) by redesignating clauses (i) and (ii) as 
                  subparagraphs (A) and (B), respectively;
                (2) by striking paragraph (3); and
                (3) by redesignating paragraph (4) as paragraph (3).
            (b) UTILIZATION OF AGRICULTURAL COMMODITIES- Section 9(c) of the
          National School Lunch Act (42 U.S.C. 1758(c)) is amended--
                (1) in the fifth sentence, by striking `of the provisions of
              law referred to in the preceding sentence' and inserting
              `provision of law'; and
                (2) by striking the second, fourth, and sixth sentences.
            (c) NUTRITIONAL INFORMATION- Section 9(f) of the National School
          Lunch Act (42 U.S.C. 1758(f)) is amended--
                (1) by striking paragraph (1);
                (2) by striking `(2)';
                (3) by redesignating subparagraphs (A) through (D) as
              paragraphs (1) through (4), respectively;
                (4) by striking paragraph (1), as redesignated by paragraph
              (3), and inserting the following:
                `(1) NUTRITIONAL REQUIREMENTS- Except as provided in 
              paragraph (2), not later than the first day of the 1996-1997
              school year, schools that are participating in the school lunch
              or school breakfast program shall serve lunches and breakfasts
              under the program that--
                    `(A) are consistent with the goals of the most recent
                  Dietary Guidelines for Americans published under section 
                  301 of the National Nutrition Monitoring and Related
                  Research Act of 1990 (7 U.S.C. 5341); and
                    `(B) provide, on the average over each week, at least--
                        `(i) with respect to school lunches,  1/3  of the
                      daily recommended dietary allowance established by the
                      Food and Nutrition Board of the National Research
                      Council of the National Academy of Sciences; and
                        `(ii) with respect to school breakfasts,  1/4  of the
                      daily recommended dietary allowance established by the
                      Food and Nutrition Board of the National Research
                      Council of the National Academy of Sciences.';
                (5) in paragraph (3), as redesignated by paragraph (3)--
                    (A) by redesignating clauses (i) and (ii) as 
                  subparagraphs (A) and (B), respectively; and
                    (B) in subparagraph (A), as so redesignated, by
                  redesignating subclauses (I) and (II) as clauses (i) and
                  (ii), respectively; and
                (6) in paragraph (4), as redesignated by paragraph (3)--
                    (A) by redesignating clauses (i) and (ii) as 
                  subparagraphs (A) and (B), respectively;
                    (B) in subparagraph (A), as redesignated by subparagraph
                  (A), by redesignating subclauses (I) and (II) as clauses 
                  (i) and (ii), respectively; and
                    (C) in subparagraph (A)(ii), as redesignated by
                  subparagraph (B), by striking `subparagraph (C)' and
                  inserting `paragraph (3)'.
            (d) USE OF RESOURCES- Section 9 of the National School Lunch Act
          (42 U.S.C. 1758) is amended by striking subsection (h).
          SEC. 703. FREE AND REDUCED PRICE POLICY STATEMENT.
            Section 9(b)(2) of the National School Lunch Act (42 U.S.C.
          1758(b)(2)) is  amended by adding at the end the following:
                    `(D) FREE AND REDUCED PRICE POLICY STATEMENT- After the
                  initial submission, a school food authority shall not be
                  required to submit a free and reduced price policy 
                  statement to a State educational agency under this Act
                  unless there is a substantive change in the free and 
                  reduced price policy of the school food authority. A 
                  routine change in the policy of a school food authority,
                  such as an annual adjustment of the income eligibility
                  guidelines for free and reduced price meals, shall not be
                  sufficient cause for requiring the school food authority to
                  submit a policy statement.'.
          SEC. 704. SPECIAL ASSISTANCE.
            (a) EXTENSION OF PAYMENT PERIOD- Section 11(a)(1)(D)(i) of the
          National School Lunch Act (42 U.S.C. 1759a(a)(1)(D)(i)) is amended
          by striking `, on the date of enactment of this subparagraph,'.
            (b) ROUNDING RULE FOR LUNCH, BREAKFAST, AND SUPPLEMENT RATES- 
                (1) IN GENERAL- The third sentence of section 11(a)(3)(B) of
              the National School Lunch Act (42 U.S.C. 1759a(a)(3)(B)) is
              amended by adding before the period at the end the following: 
              `, except that adjustments to payment rates for meals and
              supplements served to individuals not determined to be eligible
              for free or reduced price meals and supplements shall be
              computed to the nearest lower cent increment and based on the
              unrounded amount for the preceding 12-month period'.
                (2) EFFECTIVE DATE- The amendment made by paragraph (1) shall
              become effective on July 1, 1997.
            (c) APPLICABILITY OF OTHER PROVISIONS- Section 11 of the National
          School Lunch Act (42 U.S.C. 1759a) is amended--
                (1) by striking subsection (d);
                (2) in subsection (e)(2)--
                    (A) by striking `The' and inserting `On request of the
                  Secretary, the'; and
                    (B) by striking `each month'; and
                (3) by redesignating subsections (e) and (f), as so amended,
              as subsections (d) and (e), respectively.
          SEC. 705. MISCELLANEOUS PROVISIONS AND DEFINITIONS.
            (a) ACCOUNTS AND RECORDS- The second sentence of section 12(a) of
          the National School Lunch Act (42 U.S.C. 1760(a)) is amended by
          striking `at all times be available' and inserting `be available at
          any reasonable time'.
            (b) RESTRICTION ON REQUIREMENTS- Section 12(c) of the National
          School Lunch Act (42 U.S.C. 1760(c)) is amended by striking 
          `neither the Secretary nor the State shall' and inserting `the
          Secretary shall not'.
            (c) DEFINITIONS- Section 12(d) of the National School Lunch Act
          (42 U.S.C. 1760(d)), as amended by section 701(b), is  amended--
                (1) in paragraph (1), by striking `the Trust Territory of the
              Pacific Islands' and inserting `the Commonwealth of the 
              Northern Mariana Islands';
                (2) by striking paragraphs (3) and (4); and
                (3) by redesignating paragraphs (1), (2), and (5) through (9)
              as paragraphs (6), (7), (3), (4), (2), (5), and (1),
              respectively, and rearranging the paragraphs so as to appear in
              numerical order.
            (d) ADJUSTMENTS TO NATIONAL AVERAGE PAYMENT RATES- Section 12(f)
          of the National School Lunch Act (42 U.S.C. 1760(f)) is amended by
          striking `the Trust Territory of the Pacific Islands,'.
            (e) EXPEDITED RULEMAKING- Section 12(k) of the National School
          Lunch Act (42 U.S.C. 1760(k)) is amended--
                (1) by striking paragraphs (1), (2), and (5);
                (2) by redesignating paragraphs (3) and (4) as paragraphs (1)
              and (2), respectively; and
                (3) in paragraph (1), as redesignated by paragraph (2), by
              striking `Guidelines' and inserting `guidelines contained in 
              the most recent `Dietary Guidelines for Americans' that is
              published under section 301 of the National Nutrition 
              Monitoring and Related Research Act of 1990 (7 U.S.C. 5341)'.
            (f) WAIVER- Section 12(l) of the National School Lunch Act (42
          U.S.C. 1760(l)) is amended--
                (1) in paragraph (2)(A)--
                    (A) in clause (iii), by adding `and' at the end;
                    (B) in clause (iv), by striking the semicolon at the end
                  and inserting a period; and
                    (C) by striking clauses (v) through (vii);
                (2) in paragraph (3)--
                    (A) in subparagraph (A), by striking `(A)'; and
                    (B) by striking subparagraphs (B) through (D);
                (3) in paragraph (4)--
                    (A) in the matter preceding subparagraph (A), by striking
                  `of any requirement relating' and inserting `that increases
                  Federal costs or that relates';
                    (B) by striking subparagraph (D);
                    (C) by redesignating subparagraphs (E) through (N) as
                  subparagraphs (D) through (M), respectively; and
                    (D) in subparagraph (L), as redesignated by subparagraph
                  (C), by striking `and' at the end and inserting `or'; and
                (4) in paragraph (6)--
                    (A) by striking `(A)(i)' and all that follows through
                  `(B)'; and
                    (B) by redesignating clauses (i) through (iv) as
                  subparagraphs (A) through (D), respectively.
          SEC. 706. SUMMER FOOD SERVICE PROGRAM FOR CHILDREN.
            (a) ESTABLISHMENT OF PROGRAM- Section 13(a) of the National 
          School Lunch Act (42 U.S.C. 1761(a)) is amended--
                (1) in paragraph (1)--
                    (A) in the first sentence, by striking `initiate,
                  maintain, and expand' and inserting `initiate and 
                  maintain'; and
                    (B) in subparagraph (E) of the second sentence, by
                  striking `the Trust Territory of the Pacific Islands,'; and
                (2) in paragraph (7)(A), by striking `Except as provided in
              subparagraph (C), private' and inserting `Private'.
            (b) SERVICE INSTITUTIONS- Section 13(b) of the National School
          Lunch Act (42 U.S.C. 1761(b)) is amended by striking `(b)(1)' and
          all that follows through the end of paragraph (1) and inserting the
          following:
            `(b) SERVICE INSTITUTIONS- 
                `(1) PAYMENTS- 
                    `(A) IN GENERAL- Except as otherwise provided in this
                  paragraph, payments to service institutions shall equal the
                  full cost of food service operations (which cost shall
                  include the costs of obtaining, preparing, and serving 
                  food, but shall not include administrative costs).
                    `(B) MAXIMUM AMOUNTS- Subject to subparagraph (C),
                  payments to any institution under subparagraph (A) shall 
                  not exceed--
                        `(i) $1.97 for each lunch and supper served;
                        `(ii) $1.13 for each breakfast served; and
                        `(iii) 46 cents for each meal supplement served.
                    `(C) ADJUSTMENTS- Amounts specified in subparagraph (B)
                  shall be adjusted on January 1, 1997, and each January 1
                  thereafter, to the nearest lower cent increment to reflect
                  changes for the 12-month period ending the preceding
                  November 30 in the series for food away from home of the
                  Consumer Price Index for All Urban Con-sumers published by
                  the Bureau of Labor Statistics of the Department of Labor.
                  Each adjustment shall be based on the unrounded adjustment
                  for the prior 12-month period.'.
            (c) ADMINISTRATION OF SERVICE INSTITUTIONS- Section 13(b)(2) of
          the National School Lunch Act (42 U.S.C. 1761(b)(2)) is amended--
                (1) in the first sentence, by striking `four meals' and
              inserting `3 meals, or 2 meals and 1 supplement,'; and
                (2) by striking the second sentence.
            (d) REIMBURSEMENTS- Section 13(c)(2) of the National School Lunch
          Act (42 U.S.C. 1761(c)(2)) is amended--
                (1) by striking subparagraphs (A), (C), (D), and (E);
                (2) by striking `(B)';
                (3) by striking `, and such higher education institu-tions,';
              and
                (4) by striking `without application' and inserting `on
              showing residence in areas in which poor economic conditions
              exist or on the basis of income eligibility statements for
              children enrolled in the program'.
            (e) ADVANCE PROGRAM PAYMENTS- Section 13(e)(1) of the National
          School Lunch Act (42 U.S.C. 1761(e)(1)) is amended--
                (1) by striking `institution:  [Italic->] Provided, 
              [<-Italic]  That (A) the' and inserting `institution. The';
                (2) by inserting `(excluding a school)' after `any service
              institution'; and
                (3) by striking `responsibilities, and (B) no' and inserting
              `responsibilities. No'.
            (f) FOOD REQUIREMENTS- Section 13(f) of the National School Lunch
          Act (42 U.S.C. 1761(f)) is amended--
                (1) by redesignating the first through seventh sentences as
              paragraphs (1) through (7), respectively;
                (2) by striking paragraph (3), as redesignated by para-graph
              (1);
                (3) in paragraph (4), as redesignated by paragraph (1), by
              striking `the first sentence' and inserting `paragraph (1)';
                (4) in subparagraph (B) of paragraph (6), as re-designated by
              paragraph (1), by striking `that bacteria levels' and all that
              follows through the period at the end and inserting 
              `conformance with standards set by local health authorities.';
              and
                (5) by redesignating paragraphs (4) through (7), as
              redesignated by paragraph (1), as paragraphs (3) through (6),
              respectively.
            (g) PERMITTING OFFER VERSUS SERVE- Section 13(f) of the National
          School Lunch Act (42 U.S.C. 1761(f)), as amended by subsection (f),
          is  amended by adding at the end the following:
                `(7) OFFER VERSUS SERVE- A school food authority 
              participating as a service institution may permit a child
              attending a site on school premises operated directly by the
              authority to refuse one or more items of a meal that the child
              does not intend to consume, under rules that the school uses 
              for school meals programs. A refusal of an offered food item
              shall not affect the amount of payments made under this section
              to a school for the meal.'.
            (h) RECORDS- The second sentence of section 13(m) of the National
          School Lunch Act (42 U.S.C. 1761(m)) is amended by striking `at all
          times be available' and inserting `be available at any reasonable
          time'.
            (i) REMOVING MANDATORY NOTICE TO INSTITUTIONS- Section 13(n)(2) 
          of the National School Lunch Act (42 U.S.C. 1761(n)(2)) is amended
          by striking `, and its plans and schedule for informing service
          institutions of the availability of the program'.
            (j) PLAN- Section 13(n) of the National School Lunch Act (42
          U.S.C. 1761(n)), as amended by subsection (i), is amended--
                (1) in paragraph (2), by striking `, including the State's
              methods of assessing need';
                (2) by striking paragraph (3);
                (3) in paragraph (4), by striking `and schedule'; and
                (4) by redesignating paragraphs (4) through (7) as paragraphs
              (3) through (6), respectively.
            (k) MONITORING AND TRAINING- Section 13(q) of the National School
          Lunch Act (42 U.S.C. 1761(q)) is amended--
                (1) by striking paragraphs (2) and (4);
                (2) in paragraph (3), by striking `paragraphs (1) and (2) of
              this subsection' and inserting `paragraph (1)'; and
                (3) by redesignating paragraph (3) as paragraph (2).
            (l) EXPIRED PROGRAM- Section 13 of the National School Lunch Act
          (42 U.S.C. 1761) is amended--
                (1) by striking subsection (p); and
                (2) by redesignating subsections (q) and (r) as subsections
              (p) and (q), respectively.
            (m) EFFECTIVE DATE- The amendments made by subsection (b) shall
          become effective on January 1, 1997.
          SEC. 707. COMMODITY DISTRIBUTION.
            (a) CEREAL AND SHORTENING IN COMMODITY DONATIONS- Section 14(b) 
          of the National School Lunch Act (42 U.S.C. 1762a(b)) is amended--
                (1) by striking paragraph (1); and
                (2) by redesignating paragraphs (2) and (3) as paragraphs (1)
              and (2), respectively.
            (b) STATE ADVISORY COUNCIL- Section 14(e) of the National School
          Lunch Act (42 U.S.C. 1762a(e)) is amended to read as follows:
            `(e) Each State agency that receives food assistance payments
          under this section for any school year shall consult with
          representatives of schools in the State that participate in the
          school lunch program with respect to the needs of such schools
          relating to the manner of selection and distribution of commodity
          assistance for such program.'.
            (c) CASH COMPENSATION FOR PILOT PROJECT SCHOOLS- Section 14(g) of
          the National School Lunch Act (42 U.S.C. 1762a(g)) is amended by
          striking paragraph (3).
          SEC. 708. CHILD AND ADULT CARE FOOD PROGRAM.
            (a) ESTABLISHMENT OF PROGRAM- Section 17 of the National School
          Lunch Act (42 U.S.C. 1766) is amended in the first sentence of
          subsection (a), by striking `initiate, maintain, and expand' and
          inserting `initiate and maintain'.
            (b) PAYMENTS TO SPONSOR EMPLOYEES- Paragraph (2) of the last
          sentence of section 17(a) of the National School Lunch Act (42
          U.S.C. 1766(a)) is amended--
                (1) in subparagraph (B), by striking `and' at the end;
                (2) in subparagraph (C), by striking the period at the end 
              and inserting `; and'; and
                (3) by adding at the end the following:
                    `(D) in the case of a family or group day care home
                  sponsoring organization that employs more than one 
                  employee, the organization does not base payments to an
                  employee of the organization on the number of family or
                  group day care homes recruited.'.
            (c) TECHNICAL ASSISTANCE- The last sentence of section 17(d)(1) 
          of the National School Lunch Act (42 U.S.C. 1766(d)(1)) is amended
          by striking `, and shall provide technical assistance' and all that
          follows through `its application'.
            (d) REIMBURSEMENT OF CHILD CARE INSTITUTIONS- Section 17(f)(2)(B)
          of the National School Lunch Act (42 U.S.C. 1766(f)(2)(B)) is
          amended by striking `two meals and two supplements or three meals
          and one supplement' and inserting `2 meals and 1 supplement'.
            (e) IMPROVED TARGETING OF DAY CARE HOME REIMBURSEMENTS- 
                (1) RESTRUCTURED DAY CARE HOME REIMBURSEMENTS- Section
              17(f)(3) of the National School Lunch Act (42 U.S.C. 
              1766(f)(3)) is amended by striking `(3)(A) Institutions' and 
              all that follows through the end of subparagraph (A) and
              inserting the following:
                `(3) REIMBURSEMENT OF FAMILY OR GROUP DAY CARE HOME 
              SPONSORING ORGANIZATIONS-
                    `(A) REIMBURSEMENT FACTOR- 
                        `(i) IN GENERAL- An institution that participates in
                      the program under this section as a family or group day
                      care home sponsoring organization shall be provided, 
                      for payment to a home sponsored by the organization,
                      reimbursement factors in accordance with this
                      subparagraph for the cost of obtaining and preparing
                      food and prescribed labor costs involved in providing
                      meals under this section.
                        `(ii) TIER I FAMILY OR GROUP DAY CARE HOMES- 
            `(I) DEFINITION OF TIER I FAMILY OR GROUP DAY CARE HOME- In this
          paragraph, the term `tier I family or group day care home' means--
            `(aa) a family or group day care home that is located in a
          geographic area, as defined by the Secretary based on census data,
          in which at least 50 percent of the children residing in the area
          are members of households whose incomes meet the income eligibility
          guidelines for free or reduced price meals under section 9;
            `(bb) a family or group day care home that is located in an area
          served by a school enrolling elementary students in which at least
          50 percent of the total number of children enrolled are certified
          eligible to receive free or reduced price school meals under this
          Act or the Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.); or
            `(cc) a family or group day care home that is operated by a
          provider whose household meets the income eligibility guidelines 
          for free or reduced price meals under section 9 and whose income is
          verified by the sponsoring organization of the home under
          regulations established by the Secretary.
            `(II) REIMBURSEMENT- Except as provided in subclause (III), a 
          tier I family or group day care home shall be provided 
          reimbursement factors under this clause without a requirement for
          documentation of the costs described in clause (i), except that
          reimbursement shall not be provided under this subclause for meals
          or supplements served to the children of a person acting as a 
          family or group day care home provider unless the children meet the
          income eligibility guidelines for free or reduced price meals under
          section 9.
            `(III) FACTORS- Except as provided in subclause (IV), the
          reimbursement factors applied to a home referred to in subclause
          (II) shall be the factors in effect on July 1, 1996.
            `(IV) ADJUSTMENTS- The reimbursement factors under this
          subparagraph shall be adjusted on July 1, 1997, and each July 1
          thereafter, to reflect changes in the Consumer Price Index for food
          at home for the most recent 12-month period for which the data are
          available. The reimbursement factors under this subparagraph shall
          be rounded to the nearest lower cent increment and based on the
          unrounded adjustment in effect on June 30 of the preceding school
          year.
                        `(iii) TIER II FAMILY OR GROUP DAY CARE HOMES- 
            `(I) IN GENERAL- 
            `(aa) FACTORS- Except as provided in subclause (II), with respect
          to meals or supplements served under this clause by a family or
          group day care home that does not meet the criteria set forth in
          clause (ii)(I), the reimbursement factors shall be 95 cents for
          lunches and suppers, 27 cents for breakfasts, and 13 cents for
          supplements.
            `(bb) ADJUSTMENTS- The factors shall be adjusted on July 1, 1997,
          and each July 1 thereafter, to reflect changes in the Consumer 
          Price Index for food at home for the most recent 12-month period 
          for which the data are available. The reimbursement factors under
          this item shall be rounded down to the nearest lower cent increment
          and based on the unrounded adjustment for the preceding 12-month
          period.
            `(cc) REIMBURSEMENT- A family or group day care home shall be
          provided reimbursement factors under this subclause without a
          requirement for documentation of the costs described in clause (i),
          except that reimbursement shall not be provided under this 
          subclause for meals or supplements served to the children of a
          person acting as a family or group day care home provider unless 
          the children meet the income eligibility guidelines for free or
          reduced price meals under section 9.
            `(II) OTHER FACTORS- A family or group day care home that does 
          not meet the criteria set forth in clause (ii)(I) may elect to be
          provided reimbursement factors determined in accordance with the
          following requirements:
            `(aa) CHILDREN ELIGIBLE FOR FREE OR REDUCED PRICE MEALS- In the
          case of meals or supplements served under this subsection to
          children who are members of households whose incomes meet the 
          income eligibility guidelines for free or reduced price meals under
          section 9, the family or group day care home shall be provided
          reimbursement factors set by the Secretary in accordance with 
          clause (ii)(III).
            `(bb) INELIGIBLE CHILDREN- In the case of meals or supplements
          served under this subsection to children who are members of
          households whose incomes do not meet the income eligibility
          guidelines, the family or group day care home shall be provided
          reimbursement factors in accordance with subclause (I).
            `(III) INFORMATION AND DETERMINATIONS- 
            `(aa) IN GENERAL- If a family or group day care home elects to
          claim the factors described in subclause (II), the family or group
          day care home sponsoring organization serving the home shall 
          collect the necessary income information, as determined by the
          Secretary, from any parent or other caretaker to make the
          determinations specified in subclause (II) and shall make the
          determinations in accordance with rules prescribed by the Secretary.
            `(bb) CATEGORICAL ELIGIBILITY- In making a determination under
          item (aa), a family or group day care home sponsoring organization
          may consider a child participating in or subsidized under, or a
          child with a parent participating in or subsidized under, a
          federally or State supported child care or other benefit program
          with an income eligibility limit that does not exceed the
          eligibility standard for free or reduced price meals under section 
          9 to be a child who is a member of a household whose income meets
          the income eligibility guidelines under section 9.
            `(cc) FACTORS FOR CHILDREN ONLY- A family or group day care home
          may elect to receive the reimbursement factors prescribed under
          clause (ii)(III) solely for the children participating in a program
          referred to in item (bb) if the home elects not to have income
          statements collected from parents or other caretakers.
            `(IV) SIMPLIFIED MEAL COUNTING AND REPORTING PROCEDURES- The
          Secretary shall prescribe simplified meal counting and reporting
          procedures for use by a family or group day care home that elects 
          to claim the factors under subclause (II) and by a family or group
          day care home sponsoring organization that sponsors the home. The
          procedures the Secretary prescribes may include 1 or more of the
          following:
            `(aa) Setting an annual percentage for each home of the number of
          meals served that are to be reimbursed in accordance with the
          reimbursement factors prescribed under clause (ii)(III) and an
          annual percentage of the number of meals served that are to be
          reimbursed in accordance with the reimbursement factors prescribed
          under subclause (I), based on the family income of children 
          enrolled in the home in a specified month or other period.
            `(bb) Placing a home into 1 of 2 or more reimbursement categories
          annually based on the percentage of children in the home whose
          households have incomes that meet the income eligibility guidelines
          under section 9, with each such reimbursement category carrying a
          set of reimbursement factors such as the factors prescribed under
          clause (ii)(III) or subclause (I) or factors established within the
          range of factors prescribed under clause (ii)(III) and subclause (I).
            `(cc) Such other simplified procedures as the Secretary may
          prescribe.
            `(V) MINIMUM VERIFICATION REQUIREMENTS- The Secretary may
          establish any minimum verification requirements that are necessary
          to carry out this clause.'.
                (2) GRANTS TO STATES TO PROVIDE ASSISTANCE TO FAMILY OR GROUP
              DAY CARE HOMES- Section 17(f)(3) of the National School Lunch
              Act (42 U.S.C. 1766(f)(3)) is amended by adding at the end the
              following:
                    `(D) GRANTS TO STATES TO PROVIDE ASSISTANCE TO FAMILY OR
                  GROUP DAY CARE HOMES-
                        `(i) IN GENERAL- 
            `(I) RESERVATION- From amounts made available to carry out this
          section, the Secretary shall reserve $5,000,000 of the amount made
          available for fiscal year 1997.
            `(II) PURPOSE- The Secretary shall use the funds made available
          under subclause (I) to provide grants to States for the purpose of
          providing--
            `(aa) assistance, including grants, to family and day care home
          sponsoring organizations and other appropriate organizations, in
          securing and providing training, materials, automated data
          processing assistance, and other assistance for the staff of the
          sponsoring organizations; and
            `(bb) training and other assistance to family and group day care
          homes in the implementation of the amendment to subparagraph (A)
          made by section 708(e)(1) of the Personal Responsibility and Work
          Opportunity Reconciliation Act of 1996.
                        `(ii) ALLOCATION- The Secretary shall allocate from
                      the funds reserved under clause (i)(I)--
            `(I) $30,000 in base funding to each State; and
            `(II) any remaining amount among the States, based on the number
          of family day care homes participating in the program in a State
          during fiscal year 1995 as a percentage of the number of all family
          day care homes participating in the program during fiscal year 1995.
                        `(iii) RETENTION OF FUNDS- Of the amount of funds 
                      made available to a State for fiscal year 1997 under
                      clause (i), the State may retain not to exceed 30
                      percent of the amount to carry out this subparagraph.
                        `(iv) ADDITIONAL PAYMENTS- Any payments received 
                      under this subparagraph shall be in addition to 
                      payments that a State receives under subparagraph (A).'.
                (3) PROVISION OF DATA- Section 17(f)(3) of the National 
              School Lunch Act (42 U.S.C. 1766(f)(3)), as amended by 
              paragraph (2), is amended by adding at the end the following:
                    `(E) PROVISION OF DATA TO FAMILY OR GROUP DAY CARE HOME
                  SPONSORING ORGANIZATIONS-
                        `(i) CENSUS DATA- The Secretary shall provide to each
                      State agency administering a child and adult care food
                      program under this section data from the most recent
                      decennial census survey or other appropriate census
                      survey for which the data are available showing which
                      areas in the State meet the requirements of 
                      subparagraph (A)(ii)(I)(aa). The State agency shall
                      provide the data to family or group day care home
                      sponsoring organizations located in the State.
                        `(ii) SCHOOL DATA- 
            `(I) IN GENERAL- A State agency administering the school lunch
          program under this Act or the school breakfast program under the
          Child Nutrition Act of 1966 (42 U.S.C. 1771 et seq.) shall provide
          to approved family or group day care home sponsoring organizations 
          a list of schools serving elementary school children in the State 
          in which not less than  1/2  of the children enrolled are certified
          to receive free or reduced price meals. The State agency shall
          collect the data necessary to create the list annually and provide
          the list on a timely basis to any approved family or group day care
          home sponsoring organization that requests the list.
            `(II) USE OF DATA FROM PRECEDING SCHOOL YEAR- In determining for 
          a fiscal year or other annual period whether a home qualifies as a
          tier I family or group day care home under subparagraph (A)(ii)(I),
          the State agency administering the program under this section, and 
          a family or group day care home sponsoring organization, shall use
          the most current available data at the time of the determination.
                        `(iii) DURATION OF DETERMINATION- For purposes of 
                      this section, a determination that a family or group 
                      day care home is located in an area that qualifies the
                      home as a tier I family or group day care home (as the
                      term is defined in subparagraph (A)(ii)(I)), shall be 
                      in effect for 3 years (unless the determination is made
                      on the basis of census data, in which case the
                      determination shall remain in effect until more recent
                      census data are available) unless the State agency
                      determines that the area in which the home is located 
                      no longer qualifies the home as a tier I family or 
                      group day care home.'.
                (4) CONFORMING AMENDMENTS- Section 17(c) of the National
              School Lunch Act (42 U.S.C. 1766(c)) is amended by inserting
              `except as provided in subsection (f)(3),' after `For purposes
              of this section,' each place it appears in paragraphs (1), (2),
              and (3).
            (f) REIMBURSEMENT- Section 17(f) of the National School Lunch Act
          (42 U.S.C. 1766(f)) is amended--
                (1) in paragraph (3)--
                    (A) in subparagraph (B), by striking the third and fourth
                  sentences; and
                    (B) in subparagraph (C)(ii), by striking `conduct
                  outreach' and all that follows through `may become' and
                  inserting `assist unlicensed family or group day care homes
                  in becoming'; and
                (2) in the first sentence of paragraph (4), by striking
              `shall' and inserting `may'.
            (g) NUTRITIONAL REQUIREMENTS- Section 17(g)(1) of the National
          School Lunch Act (42 U.S.C. 1766(g)(1)) is amended--
                (1) in subparagraph (A), by striking the second sentence; and
                (2) in subparagraph (B), by striking the second sentence.
            (h) ELIMINATION OF STATE PAPERWORK AND OUTREACH BURDEN- Section 
          17 of the National School Lunch Act (42 U.S.C. 1766) is amended by
          striking subsection (k) and inserting the following:
            `(k) TRAINING AND TECHNICAL ASSISTANCE- A State participating in
          the program established under this section shall provide sufficient
          training, technical assistance, and monitoring to facilitate
          effective operation of the program. The Secretary shall assist the
          State in developing plans to fulfill the requirements of this
          subsection.'.
            (i) RECORDS- The second sentence of section 17(m) of the National
          School Lunch Act (42 U.S.C. 1766(m)) is amended by striking `at all
          times' and inserting `at any reasonable time'.
            (j) UNNEEDED PROVISION- Section 17 of the National School Lunch
          Act is amended by striking subsection (q).
            (k) EFFECTIVE DATE- 
                (1) IN GENERAL- Except as provided in paragraph (2), the
              amendments made by this section shall become effective on the
              date of enactment of this Act.
                (2) IMPROVED TARGETING OF DAY CARE HOME REIMBURSEMENTS- The
              amendments made by paragraphs (1) and (4) of subsection (e)
              shall become effective on July 1, 1997.
                (3) REGULATIONS- 
                    (A) INTERIM REGULATIONS- Not later than January 1, 1997,
                  the Secretary of Agriculture shall issue interim 
                  regulations to implement--
                        (i) the amendments made by paragraphs (1), (3), and
                      (4) of subsection (e); and
                        (ii) section 17(f)(3)(C) of the National School Lunch
                      Act (42 U.S.C. 1766(f)(3)(C)).
                    (B) FINAL REGULATIONS- Not later than July 1, 1997, the
                  Secretary of Agriculture shall issue final regulations to
                  implement the provisions of law referred to in subparagraph
                  (A).
            (l) STUDY OF IMPACT OF AMENDMENTS ON PROGRAM PARTICIPATION AND
          FAMILY DAY CARE LICENSING-
                (1) IN GENERAL- The Secretary of Agriculture, in conjunction
              with the Secretary of Health and Human Services, shall study 
              the impact of the amendments made by this section on--
                    (A) the number of family day care homes participating in
                  the child and adult care food program established under
                  section 17 of the National School Lunch Act (42 U.S.C. 1766);
                    (B) the number of day care home sponsoring organizations
                  participating in the program;
                    (C) the number of day care homes that are licensed,
                  certified, registered, or approved by each State in
                  accordance with regulations issued by the Secretary;
                    (D) the rate of growth of the numbers referred to in
                  subparagraphs (A) through (C);
                    (E) the nutritional adequacy and quality of meals served
                  in family day care homes that--
                        (i) received reimbursement under the program prior to
                      the amendments made by this section but do not receive
                      reimbursement after the amendments made by this 
                      section; or
                        (ii) received full reimbursement under the program
                      prior to the amendments made by this section but do not
                      receive full reimbursement after the amendments made by
                      this section; and
                    (F) the proportion of low-income children participating 
                  in the program prior to the amendments made by this section
                  and the proportion of low-income children participating in
                  the program after the amendments made by this section.
                (2) REQUIRED DATA- Each State agency participating in the
              child and adult care food program under section 17 of the
              National School Lunch Act (42 U.S.C. 1766) shall submit to the
              Secretary of Agriculture data on--
                    (A) the number of family day care homes participating in
                  the program on June 30, 1997, and June 30, 1998;
                    (B) the number of family day care homes licensed,
                  certified, registered, or approved for service on June 30,
                  1997, and June 30, 1998; and
                    (C) such other data as the Secretary may require to carry
                  out this subsection.
                (3) SUBMISSION OF REPORT- Not later than 2 years after the
              date of enactment of this section, the Secretary of Agriculture
              shall submit the study required under this subsection to the
              Committee on Economic and Educational Opportunities of the 
              House of Representatives and the Committee on Agriculture,
              Nutrition, and Forestry of the Senate.
          SEC. 709. PILOT PROJECTS.
            (a) UNIVERSAL FREE PILOT- Section 18(d) of the National School
          Lunch Act (42 U.S.C. 1769(d)) is amended--
                (1) by striking paragraph (3); and
                (2) by redesignating paragraphs (4) and (5) as paragraphs (3)
              and (4), respectively.
            (b) DEMONSTRATION PROJECT OUTSIDE SCHOOL HOURS- Section 18(e) of
          the National School Lunch Act (42 U.S.C. 1769(e)) is amended--
                (1) in paragraph (1)--
                    (A) in subparagraph (A)--
                        (i) by striking `(A)'; and
                        (ii) by striking `shall' and inserting `may'; and
                    (B) by striking subparagraph (B); and
                (2) by striking paragraph (5) and inserting the following:
                `(5) AUTHORIZATION OF APPROPRIATIONS- There are authorized to
              be appropriated to carry out this subsection such sums as are
              necessary for each of fiscal years 1997 and 1998.'.
          SEC. 710. REDUCTION OF PAPERWORK.
            Section 19 of the National School Lunch Act (42 U.S.C. 1769a) is
          repealed.
          SEC. 711. INFORMATION ON INCOME ELIGIBILITY.
            Section 23 of the National School Lunch Act (42 U.S.C. 1769d) is
          repealed.
          SEC. 712. NUTRITION GUIDANCE FOR CHILD NUTRITION PROGRAMS.
            Section 24 of the National School Lunch Act (42 U.S.C. 1769e) is
          repealed.
                         SUBTITLE B--CHILD NUTRITION ACT OF 1966
          SEC. 721. SPECIAL MILK PROGRAM.
            Section 3(a)(3) of the Child Nutrition Act of 1966 (42 U.S.C.
          1772(a)(3)) is amended by striking `the Trust Territory of the
          Pacific Islands' and inserting `the Commonwealth of the Northern
          Mariana Islands'.
          SEC. 722. FREE AND REDUCED PRICE POLICY STATEMENT.
            Section 4(b)(1) of the Child Nutrition Act of 1966 (42 U.S.C.
          1773(b)(1)) is amended by adding at the end the following:
                    `(E) FREE AND REDUCED PRICE POLICY STATEMENT- After the
                  initial submission, a school food authority shall not be
                  required to submit a free and reduced price policy 
                  statement to a State educational agency under this Act
                  unless there is a substantive change in the free and 
                  reduced price policy of the school food authority. A 
                  routine change in the policy of a school food authority,
                  such as an annual adjustment of the income eligibility
                  guidelines for free and reduced price meals, shall not be
                  sufficient cause for requiring the school food authority to
                  submit a policy statement.'.
          SEC. 723. SCHOOL BREAKFAST PROGRAM AUTHORIZATION.
            (a) TRAINING AND TECHNICAL ASSISTANCE IN FOOD PREPARATION- 
          Section 4(e)(1)(B) of the Child Nutrition Act of 1966 (42 U.S.C.
          1773(e)(1)(B)) is amended by striking the second sentence.
            (b) EXPANSION OF PROGRAM; STARTUP AND EXPANSION COSTS- 
                (1) IN GENERAL- Section 4 of the Child Nutrition Act of 1966
              (42 U.S.C. 1773) is amended by striking subsections (f) and (g).
                (2) EFFECTIVE DATE- The amendments made by paragraph (1) 
              shall become effective on October 1, 1996.
          SEC. 724. STATE ADMINISTRATIVE EXPENSES.
            (a) USE OF FUNDS FOR COMMODITY DISTRIBUTION ADMINISTRATION;
          STUDIES- Section 7 of the Child Nutrition Act of 1966 (42 U.S.C.
          1776) is amended--
                (1) by striking subsections (e) and (h); and
                (2) by redesignating subsections (f), (g), and (i) as
              subsections (e), (f), and (g), respectively.
            (b) APPROVAL OF CHANGES- Section 7(e) of the Child Nutrition Act
          of 1966 (42 U.S.C. 1776(e)), as so redesignated, is amended--
                (1) by striking `each year an annual plan' and inserting `the
              initial fiscal year a plan'; and
                (2) by adding at the end the following: `After submitting the
              initial plan, a State shall be required to submit to the
              Secretary for approval only a substantive change in the plan.'.
          SEC. 725. REGULATIONS.
            Section 10(b) of the Child Nutrition Act of 1966 (42 U.S.C.
          1779(b)) is amended--
                (1) in paragraph (1), by striking `(1)'; and
                (2) by striking paragraphs (2) through (4).
          SEC. 726. PROHIBITIONS.
            Section 11(a) of the Child Nutrition Act of 1966 (42 U.S.C.
          1780(a)) is amended by striking `neither the Secretary nor the 
          State shall' and inserting `the Secretary shall not'.
          SEC. 727. MISCELLANEOUS PROVISIONS AND DEFINITIONS.
            Section 15 of the Child Nutrition Act of 1966 (42 U.S.C. 1784) is
          amended--
                (1) in paragraph (1), by striking `the Trust Territory of the
              Pacific Islands' and inserting `the Commonwealth of the 
              Northern Mariana Islands'; and
                (2) in the first sentence of paragraph (3)--
                    (A) in subparagraph (A), by inserting `and' at the end; and
                    (B) by striking `, and (C)' and all that follows through
                  `Governor of Puerto Rico'.
          SEC. 728. ACCOUNTS AND RECORDS.
            The second sentence of section 16(a) of the Child Nutrition Act 
          of 1966 (42 U.S.C. 1785(a)) is amended by striking `at all times be
          available' and inserting `be available at any reasonable time'.
          SEC. 729. SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, 
                            INFANTS, AND CHILDREN.
            (a) DEFINITIONS- Section 17(b) of the Child Nutrition Act of 1966
          (42 U.S.C. 1786(b)) is amended--
                (1) in paragraph (15)(B)(iii), by inserting `of not more than
              365 days' after `accommodation'; and
                (2) in paragraph (16)--
                    (A) in subparagraph (A), by adding `and' at the end; and
                    (B) in subparagraph (B), by striking `; and' and 
                  inserting a period; and
                    (C) by striking subparagraph (C).
            (b) SECRETARY'S PROMOTION OF WIC- Section 17(c) of the Child
          Nutrition Act of 1966 (42 U.S.C. 1786(c)) is amended by striking
          paragraph (5).
            (c) ELIGIBLE PARTICIPANTS- Section 17(d) of the Child Nutrition
          Act of 1966 (42 U.S.C. 1786(d)) is amended by striking paragraph (4).
            (d) NUTRITION EDUCATION- Section 17(e) of the Child Nutrition Act
          of 1966 (42 U.S.C. 1786(e)) is amended--
                (1) in paragraph (2), by striking the third sentence;
                (2) in paragraph (4)--
                    (A) in the matter preceding subparagraph (A), by striking
                  `shall';
                    (B) by striking subparagraph (A);
                    (C) by redesignating subparagraphs (B) and (C) as
                  subparagraphs (A) and (B), respectively;
                    (D) in subparagraph (A), as so redesignated--
                        (i) by inserting `shall' before `provide'; and
                        (ii) by striking `and' at the end;
                    (E) in subparagraph (B), as so redesignated--
                        (i) by inserting `shall' before `provide'; and
                        (ii) by striking the period at the end and inserting
                      `; and'; and
                    (F) by adding at the end the following:
                `(C) may provide a local agency with materials describing
              other programs for which a participant in the program may be
              eligible.';
                (3) in paragraph (5), by striking `The State agency shall
              ensure that each' and inserting `Each'; and
                (4) by striking paragraph (6).
            (e) STATE PLAN- Section 17(f) of the Child Nutrition Act of 1966
          (42 U.S.C. 1786(f)) is amended--
                (1) in paragraph (1)--
                    (A) in subparagraph (A)--
                        (i) by striking `annually to the Secretary, by a date
                      specified by the Secretary, a' and inserting `to the
                      Secretary, by a date specified by the Secretary, an
                      initial'; and
                        (ii) by adding at the end the following: `After
                      submitting the initial plan, a State shall be required
                      to submit to the Secretary for approval only a
                      substantive change in the plan.';
                    (B) in subparagraph (C)--
                        (i) by striking clause (iii) and inserting the
                      following:
                `(iii) a plan to coordinate operations under the program with
              other services or programs that may benefit participants in, 
              and applicants for, the program;';
                        (ii) in clause (vi), by inserting after `in the 
                      State' the following: `(including a plan to improve
                      access to the program for participants and prospective
                      applicants who are employed, or who reside in rural
                      areas)';
                        (iii) in clause (vii), by striking `to provide 
                      program benefits' and all that follows through 
                      `emphasis on' and inserting `for';
                        (iv) by striking clauses (ix), (x), and (xii);
                        (v) in clause (xiii), by striking `may require' and
                      inserting `may reasonably require';
                        (vi) by redesignating clauses (xi) and (xiii), as so
                      amended, as clauses (ix) and (x), respectively; and
                        (vii) in clause (ix), as so redesignated, by adding
                      `and' at the end;
                    (C) by striking subparagraph (D); and
                    (D) by redesignating subparagraph (E) as subparagraph (D);
                (2) by striking paragraphs (6) and (22);
                (3) in the second sentence of paragraph (5), by striking `at
              all times be available' and inserting `be available at any
              reasonable time';
                (4) in paragraph (9)(B), by striking the second sentence;
                (5) in the first sentence of paragraph (11), by striking `,
              including standards that will ensure sufficient State agency
              staff';
                (6) in paragraph (12), by striking the third sentence;
                (7) in paragraph (14), by striking `shall' and inserting `may';
                (8) in paragraph (17), by striking `and to accommodate' and
              all that follows through `facilities';
                (9) in paragraph (19), by striking `shall' and inserting
              `may'; and
                (10) by redesignating paragraphs (7) through (21) as
              paragraphs (6) through (20), and paragraphs (23) and (24) as
              paragraphs (21) and (22), respectively.
            (f) INFORMATION- Section 17(g) of the Child Nutrition Act of 1966
          (42 U.S.C. 1786(g)) is amended--
                (1) in paragraph (5), by striking `the report required under
              subsection (d)(4)' and inserting `reports on program 
              participant characteristics'; and
                (2) by striking paragraph (6).
            (g) PROCUREMENT OF INFANT FORMULA- 
                (1) IN GENERAL- Section 17(h) of the Child Nutrition Act of
              1966 (42 U.S.C. 1786(h)) is amended--
                    (A) in paragraph (4)(E), by striking `and, on' and all
                  that follows through `(d)(4)'; and
                    (B) in paragraph (8)--
                        (i) by striking subparagraphs (A), (C), and (M);
                        (ii) in subparagraph (G)--
            (I) in clause (i), by striking `(i)'; and
            (II) by striking clauses (ii) through (ix);
                        (iii) in subparagraph (I), by striking `Sec-retary--'
                      and all that follows through `(v) may' and inserting
                      `Secretary may';
                        (iv) by redesignating subparagraphs (B) and (D)
                      through (L) as subparagraphs (A) and (B) through (J),
                      respectively;
                        (v) in subparagraph (A)(i), as so redesignated, by
                      striking `subparagraphs (C), (D), and (E)(iii), in
                      carrying out subparagraph (A),' and inserting
                      `subparagraphs (B) and (C)(iii),';
                        (vi) in subparagraph (B)(i), as so redesignated, by
                      striking `subparagraph (B)' each place it appears and
                      inserting `subparagraph (A)'; and
                        (vii) in subparagraph (C)(iii), as so redesignated, 
                      by striking `subparagraph (B)' and inserting
                      `subparagraph (A)'.
                (2) APPLICATION- The amendments made by paragraph (1) shall
              not apply to a contract for the procurement of infant formula
              under section 17(h)(8) of the Child Nutrition Act of 1966 (42
              U.S.C. 1786(h)(8)) that is in effect on the date of enactment 
              of this subsection.
            (h) NATIONAL ADVISORY COUNCIL ON MATERNAL, INFANT, AND FETAL
          NUTRITION- Section 17(k)(3) of the Child Nutrition Act of 1966 (42
          U.S.C. 1786(k)(3)) is amended by striking `Secretary shall
          designate' and inserting `Council shall elect'.
            (i) COMPLETED STUDY; COMMUNITY COLLEGE DEMONSTRATION; GRANTS FOR
          INFORMATION AND DATA SYSTEM- Section 17 of the Child Nutrition Act
          of 1966 (42 U.S.C. 1786) is amended by striking subsections (n),
          (o), and (p).
            (j) DISQUALIFICATION OF VENDORS WHO ARE DISQUALIFIED UNDER THE
          FOOD STAMP PROGRAM- Section 17 of the Child Nutrition Act of 1966
          (42 U.S.C. 1786), as amended by subsection (i), is amended by 
          adding at the end the following:
            `(n) DISQUALIFICATION OF VENDORS WHO ARE DISQUALIFIED UNDER THE
          FOOD STAMP PROGRAM-
                `(1) IN GENERAL- The Secretary shall issue regulations
              providing criteria for the disqualification under this section
              of an approved vendor that is disqualified from accepting
              benefits under the food stamp program established under the 
              Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.).
                `(2) TERMS- A disqualification under paragraph (1)--
                    `(A) shall be for the same period as the disqualification
                  from the program referred to in paragraph (1);
                    `(B) may begin at a later date than the disqualification
                  from the program referred to in paragraph (1); and
                    `(C) shall not be subject to judicial or administrative
                  review.'.
          SEC. 730. CASH GRANTS FOR NUTRITION EDUCATION.
            Section 18 of the Child Nutrition Act of 1966 (42 U.S.C. 1787) is
          repealed.
          SEC. 731. NUTRITION EDUCATION AND TRAINING.
            (a) FINDINGS- Section 19 of the Child Nutrition Act of 1966 (42
          U.S.C. 1788) is amended--
                (1) in subsection (a), by striking `that--' and all that
              follows through the period at the end and inserting `that
              effective dissemination of scientifically valid information to
              children participating or eligible to participate in the school
              lunch and related child nutrition programs should be
              encouraged.'; and
                (2) in subsection (b), by striking `encourage' and all that
              follows through `establishing' and inserting `establish'.
            (b) USE OF FUNDS- Section 19(f) of the Child Nutrition Act of 
          1966 (42 U.S.C. 1788(f)) is amended--
                (1) in paragraph (1)--
                    (A) by striking subparagraph (B); and
                    (B) in subparagraph (A)--
                        (i) by striking `(A)';
                        (ii) by striking clauses (ix) through (xix);
                        (iii) by redesignating clauses (i) through (viii) and
                      (xx) as subparagraphs (A) through (H) and (I),
                      respectively;
                        (iv) in subparagraph (I), as so redesignated, by
                      striking the period at the end and inserting `; and'; and
                        (v) by adding at the end the following:
                `(J) other appropriate related activities, as determined by
              the State.';
                (2) by striking paragraphs (2) and (4); and
                (3) by redesignating paragraph (3) as paragraph (2).
            (c) ACCOUNTS, RECORDS, AND REPORTS- The second sentence of 
          section 19(g)(1) of the Child Nutrition Act of 1966 (42 U.S.C.
          1788(g)(1)) is amended by striking `at all times be available' and
          inserting `be available at any reasonable time'.
            (d) STATE COORDINATORS FOR NUTRITION; STATE PLAN- Section 19(h) 
          of the Child Nutrition Act of 1966 (42 U.S.C. 1788(h)) is amended--
                (1) in the second sentence of paragraph (1)--
                    (A) by striking `as provided in paragraph (2) of this
                  subsection'; and
                    (B) by striking `as provided in paragraph (3) of this
                  subsection';
                (2) in paragraph (2), by striking the second and third
              sentences; and
                (3) by striking paragraph (3).
            (e) AUTHORIZATION OF APPROPRIATIONS- Section 19(i) of the Child
          Nutrition Act of 1966 (42 U.S.C. 1788(i)) is amended--
                (1) in the first sentence of paragraph (2)(A), by striking
              `and each succeeding fiscal year';
                (2) by redesignating paragraphs (3) and (4) as paragraphs (4)
              and (5), respectively; and
                (3) by inserting after paragraph (2) the following:
                `(3) FISCAL YEARS 1997 THROUGH 2002- 
                    `(A) IN GENERAL- There are authorized to be appropriated
                  to carry out this section $10,000,000 for each of fiscal
                  years 1997 through 2002.
                    `(B) GRANTS- 
                        `(i) IN GENERAL- Grants to each State from the 
                      amounts made available under subparagraph (A) shall be
                      based on a rate of 50 cents for each child enrolled in
                      schools or institutions within the State, except that 
                      no State shall receive an amount less than $75,000 per
                      fiscal year.
                        `(ii) INSUFFICIENT FUNDS- If the amount made 
                      available for any fiscal year is insufficient to pay 
                      the amount to which each State is entitled under clause
                      (i), the amount of each grant shall be ratably reduced.'.
            (f) ASSESSMENT- Section 19 of the Child Nutrition Act of 1966 (42
          U.S.C. 1788) is amended by striking subsection (j).
            (g) EFFECTIVE DATE- The amendments made by subsection (e) shall
          become effective on October 1, 1996.
                          SUBTITLE C--MISCELLANEOUS PROVISIONS
          SEC. 741. COORDINATION OF SCHOOL LUNCH, SCHOOL BREAKFAST, AND 
                            SUMMER FOOD SERVICE PROGRAMS.
            (a) COORDINATION- 
                (1) IN GENERAL- The Secretary of Agriculture shall develop
              proposed changes to the regulations under the school lunch
              program under the National School Lunch Act (42 U.S.C. 1751 et
              seq.), the summer food service program under section 13 of that
              Act (42 U.S.C. 1761), and the school breakfast program under
              section 4 of the Child Nutrition Act of 1966 (42 U.S.C. 1773),
              for the purpose of simplifying and coordinating those programs
              into a comprehensive meal program.
                (2) CONSULTATION- In developing proposed changes to the
              regulations under paragraph (1), the Secretary of Agriculture
              shall consult with local, State, and regional administrators of
              the programs described in such paragraph.
            (b) REPORT- Not later than November 1, 1997, the Secretary of
          Agriculture shall submit to the Committee on Agriculture, 
          Nutrition, and Forestry of the Senate and the Committee on Economic
          and Educational Opportunities of the House of Representatives a
          report containing the proposed changes developed under subsection
          (a).
          SEC. 742. REQUIREMENTS RELATING TO PROVISION OF BENEFITS BASED ON
                            CITIZENSHIP, ALIENAGE, OR IMMIGRATION STATUS 
                            UNDER THE NATIONAL SCHOOL LUNCH ACT, THE CHILD
                            NUTRITION ACT OF 1966, AND CERTAIN OTHER ACTS.
            (a) SCHOOL LUNCH AND BREAKFAST PROGRAMS- Notwithstanding any 
          other provision of this Act, an individual who is eligible to
          receive free public education benefits under State or local law
          shall not be ineligible to receive benefits provided under the
          school lunch program under the National School Lunch Act (42 U.S.C.
          1751 et seq.) or the school breakfast program under section 4 of 
          the Child Nutrition Act of 1966 (42 U.S.C. 1773) on the basis of
          citizenship, alienage, or immigration status.
            (b) OTHER PROGRAMS- 
                (1) IN GENERAL- Nothing in this Act shall prohibit or require
              a State to provide to an individual who is not a citizen or a
              qualified alien, as defined in section 431(b), benefits under
              programs established under the provisions of law described in
              paragraph (2).
                (2) PROVISIONS OF LAW DESCRIBED- The provisions of law
              described in this paragraph are the following:
                    (A) Programs (other than the school lunch program and the
                  school breakfast program) under the National School Lunch
                  Act (42 U.S.C. 1751 et seq.) and the Child Nutrition Act of
                  1966 (42 U.S.C. 1771 et seq.).
                    (B) Section 4 of the Agriculture and Consumer Protection
                  Act of 1973 (7 U.S.C. 612c note).
                    (C) The Emergency Food Assistance Act of 1983 (7 U.S.C
                  612c note).
                    (D) The food distribution program on Indian reservations
                  established under section 4(b) of the Food Stamp Act of 
                  1977 (7 U.S.C 2013(b)).
                   TITLE VIII--FOOD STAMPS AND COMMODITY DISTRIBUTION
                             SUBTITLE A--FOOD STAMP PROGRAM
          SEC. 801. DEFINITION OF CERTIFICATION PERIOD.
            Section 3(c) of the Food Stamp Act of 1977 (7 U.S.C. 2012(c)) is
          amended by striking `Except as provided' and all that follows and
          inserting the following: `The certification period shall not exceed
          12 months, except that the certification period may be up to 24
          months if all adult household members are elderly or disabled. A
          State agency shall have at least 1 contact with each certified
          household every 12 months.'.
          SEC. 802. DEFINITION OF COUPON.
            Section 3(d) of the Food Stamp Act of 1977 (7 U.S.C. 2012(d)) is
          amended by striking `or type of certificate' and inserting `type of
          certificate, authorization card, cash or check issued in lieu of a
          coupon, or access device, including an electronic benefit transfer
          card or personal identification number,'.
          SEC. 803. TREATMENT OF CHILDREN LIVING AT HOME.
            The second sentence of section 3(i) of the Food Stamp Act of 1977
          (7 U.S.C. 2012(i)) is amended by striking `(who are not themselves
          parents living with their children or married and living with their
          spouses)'.
          SEC. 804. ADJUSTMENT OF THRIFTY FOOD PLAN.
            The second sentence of section 3(o) of the Food Stamp Act of 1977
          (7 U.S.C. 2012(o)) is amended--
                (1) by striking `shall (1) make' and inserting the following:
              `shall--
                `(1) make';
                (2) by striking `scale, (2) make' and inserting the 
              following: `scale;
                `(2) make';
                (3) by striking `Alaska, (3) make' and inserting the
              following: `Alaska;
                `(3) make'; and
                (4) by striking `Columbia, (4) through' and all that follows
              through the end of the subsection and inserting the following:
              `Columbia; and
                `(4) on October 1, 1996, and each October 1 thereafter, 
              adjust the cost of the diet to reflect the cost of the diet in
              the preceding June, and round the result to the nearest lower
              dollar increment for each household size, except that on 
              October 1, 1996, the Secretary may not reduce the cost of the
              diet in effect on September 30, 1996.'.
          SEC. 805. DEFINITION OF HOMELESS INDIVIDUAL.
            Section 3(s)(2)(C) of the Food Stamp Act of 1977 (7 U.S.C.
          2012(s)(2)(C)) is amended by inserting `for not more than 90 days'
          after `temporary accommodation'.
          SEC. 806. STATE OPTION FOR ELIGIBILITY STANDARDS.
            Section 5(b) of the Food Stamp Act of 1977 (7 U.S.C. 2014(d)) is
          amended by striking `(b) The Secretary' and inserting the following:
            `(b) ELIGIBILITY STANDARDS- Except as otherwise provided in this
          Act, the Secretary'.
          SEC. 807. EARNINGS OF STUDENTS.
            Section 5(d)(7) of the Food Stamp Act of 1977 (7 U.S.C.
          2014(d)(7)) is amended by striking `21' and inserting `17'.
          SEC. 808. ENERGY ASSISTANCE.
            (a) IN GENERAL- Section 5(d) of the Food Stamp Act of 1977 (7
          U.S.C. 2014(d)) is amended by striking paragraph (11) and inserting
          the following: `(11)(A) any payments or allowances made for the
          purpose of providing energy assistance under any Federal law (other
          than part A of title IV of the Social Security Act (42 U.S.C. 601 
          et seq.)), or (B) a 1-time payment or allowance made under a 
          Federal or State law for the costs of weatherization or emergency
          repair or replacement of an unsafe or inoperative furnace or other
          heating or cooling device,'.
            (b) CONFORMING AMENDMENTS- Section 5(k) of the Food Stamp Act of
          1977 (7 U.S.C. 2014(k)) is amended--
                (1) in paragraph (1)--
                    (A) in subparagraph (A), by striking `plan for aid to
                  families with dependent children approved' and inserting
                  `program funded'; and
                    (B) in subparagraph (B), by striking `, not including
                  energy or utility-cost assistance,';
                (2) in paragraph (2), by striking subparagraph (C) and
              inserting the following:
                `(C) a payment or allowance described in subsection 
              (d)(11);'; and
                (3) by adding at the end the following:
                `(4) THIRD PARTY ENERGY ASSISTANCE PAYMENTS- 
                    `(A) ENERGY ASSISTANCE PAYMENTS- For purposes of
                  subsection (d)(1), a payment made under a State law (other
                  than a law referred to in paragraph (2)(H)) to provide
                  energy assistance to a household shall be considered money
                  payable directly to the household.
                    `(B) ENERGY ASSISTANCE EXPENSES- For purposes of
                  subsection (e)(7), an expense paid on behalf of a household
                  under a State law to provide energy assistance shall be
                  considered an out-of-pocket expense incurred and paid by 
                  the household.'.
          SEC. 809. DEDUCTIONS FROM INCOME.
            (a) IN GENERAL- Section 5 of the Food Stamp Act of 1977 (7 U.S.C.
          2014) is amended by striking subsection (e) and inserting the
          following:
            `(e) DEDUCTIONS FROM INCOME- 
                `(1) STANDARD DEDUCTION- The Secretary shall allow a standard
              deduction for each household in the 48 contiguous States and 
              the District of Columbia, Alaska, Hawaii, Guam, and the Virgin
              Islands of the United States of $134, $229, $189, $269, and
              $118, respectively.
                `(2) EARNED INCOME DEDUCTION- 
                    `(A) DEFINITION OF EARNED INCOME- In this paragraph, the
                  term `earned income' does not include--
                        `(i) income excluded by subsection (d); or
                        `(ii) any portion of income earned under a work
                      supplementation or support program, as defined under
                      section 16(b), that is attributable to public assistance.
                    `(B) DEDUCTION- Except as provided in subparagraph (C), a
                  household with earned income shall be allowed a deduction 
                  of 20 percent of all earned income to compensate for taxes,
                  other mandatory deductions from salary, and work expenses.
                    `(C) EXCEPTION- The deduction described in subparagraph
                  (B) shall not be allowed with respect to determining an
                  overissuance due to the failure of a household to report
                  earned income in a timely manner.
                `(3) DEPENDENT CARE DEDUCTION- 
                    `(A) IN GENERAL- A household shall be entitled, with
                  respect to expenses (other than excluded expenses described
                  in subparagraph (B)) for dependent care, to a dependent 
                  care deduction, the maximum allowable level of which shall
                  be $200 per month for each dependent child under 2 years of
                  age and $175 per month for each other dependent, for the
                  actual cost of payments necessary for the care of a
                  dependent if the care enables a household member to accept
                  or continue employment, or training or education that is
                  preparatory for employment.
                    `(B) EXCLUDED EXPENSES- The excluded expenses referred to
                  in subparagraph (A) are--
                        `(i) expenses paid on behalf of the household by a
                      third party;
                        `(ii) amounts made available and excluded, for the
                      expenses referred to in subparagraph (A), under
                      subsection (d)(3); and
                        `(iii) expenses that are paid under section 6(d)(4).
                `(4) DEDUCTION FOR CHILD SUPPORT PAYMENTS- 
                    `(A) IN GENERAL- A household shall be entitled to a
                  deduction for child support payments made by a household
                  member to or for an individual who is not a member of the
                  household if the household member is legally obligated to
                  make the payments.
                    `(B) METHODS FOR DETERMINING AMOUNT- The Secretary may
                  prescribe by regulation the methods, including calculation
                  on a retrospective basis, that a State agency shall use to
                  determine the amount of the deduction for child support
                  payments.
                `(5) HOMELESS SHELTER ALLOWANCE- Under rules prescribed by 
              the Secretary, a State agency may develop a standard homeless
              shelter allowance, which shall not exceed $143 per month, for
              such expenses as may reasonably be expected to be incurred by
              households in which all members are homeless individuals but 
              are not receiving free shelter throughout the month. A State
              agency that develops the allowance may use the allowance in
              determining eligibility and allotments for the households. The
              State agency may make a household with extremely low shelter
              costs ineligible for the allowance.
                `(6) EXCESS MEDICAL EXPENSE DEDUCTION- 
                    `(A) IN GENERAL- A household containing an elderly or
                  disabled member shall be entitled, with respect to expenses
                  other than expenses paid on behalf of the household by a
                  third party, to an excess medical expense deduction for the
                  portion of the actual costs of allowable medical expenses,
                  incurred by the elderly or disabled member, exclusive of
                  special diets, that exceeds $35 per month.
                    `(B) METHOD OF CLAIMING DEDUCTION- 
                        `(i) IN GENERAL- A State agency shall offer an
                      eligible household under subparagraph (A) a method of
                      claiming a deduction for recurring medical expenses 
                      that are initially verified under the excess medical
                      expense deduction in lieu of submitting information on,
                      or verification of, actual expenses on a monthly basis.
                        `(ii) METHOD- The method described in clause (i)
                      shall--
            `(I) be designed to minimize the burden for the eligible elderly
          or disabled household member choosing to deduct the recurrent
          medical expenses of the member pursuant to the method;
            `(II) rely on reasonable estimates of the expected medical
          expenses of the member for the certification period (including
          changes that can be reasonably anticipated based on available
          information about the medical condition of the member, public or
          private medical insurance coverage, and the current verified 
          medical expenses incurred by the member); and
            `(III) not require further reporting or verification of a change
          in medical expenses if such a change has been anticipated for the
          certification period.
                `(7) EXCESS SHELTER EXPENSE DEDUCTION- 
                    `(A) IN GENERAL- A household shall be entitled, with
                  respect to expenses other than expenses paid on behalf of
                  the household by a third party, to an excess shelter 
                  expense deduction to the extent that the monthly amount
                  expended by a household for shelter exceeds an amount equal
                  to 50 percent of monthly household income after all other
                  applicable deductions have been allowed.
                    `(B) MAXIMUM AMOUNT OF DEDUCTION- In the case of a
                  household that does not contain an elderly or disabled
                  individual, in the 48 contiguous States and the District of
                  Columbia, Alaska, Hawaii, Guam, and the Virgin Islands of
                  the United States, the excess shelter expense deduction
                  shall not exceed--
                        `(i) for the period beginning on the date of 
                      enactment of this subparagraph and ending on December
                      31, 1996, $247, $429, $353, $300, and $182 per month,
                      respectively;
                        `(ii) for the period beginning on January 1, 1997, 
                      and ending on September 30, 1998, $250, $434, $357,
                      $304, and $184 per month, respectively;
                        `(iii) for fiscal years 1999 and 2000, $275, $478,
                      $393, $334, and $203 per month, respectively; and
                        `(iv) for fiscal year 2001 and each subsequent fiscal
                      year, $300, $521, $429, $364, and $221 per month,
                      respectively.
                    `(C) STANDARD UTILITY ALLOWANCE- 
                        `(i) IN GENERAL- In computing the excess shelter
                      expense deduction, a State agency may use a standard
                      utility allowance in accordance with regulations
                      promulgated by the Secretary, except that a State 
                      agency may use an allowance that does not fluctuate
                      within a year to reflect seasonal variations.
                        `(ii) RESTRICTIONS ON HEATING AND COOLING EXPENSES- 
                      An allowance for a heating or cooling expense may not 
                      be used in the case of a household that--
            `(I) does not incur a heating or cooling expense, as the case may
          be;
            `(II) does incur a heating or cooling expense but is located in a
          public housing unit that has central utility meters and charges
          households, with regard to the expense, only for excess utility
          costs; or
            `(III) shares the expense with, and lives with, another 
          individual not participating in the food stamp program, another
          household participating in the food stamp program, or both, unless
          the allowance is prorated between the household and the other
          individual, household, or both.
                        `(iii) MANDATORY ALLOWANCE- 
            `(I) IN GENERAL- A State agency may make the use of a standard
          utility allowance mandatory for all households with qualifying
          utility costs if--
            `(aa) the State agency has developed 1 or more standards that
          include the cost of heating and cooling and 1 or more standards 
          that do not include the cost of heating and cooling; and
            `(bb) the Secretary finds that the standards will not result in 
          an increased cost to the Secretary.
            `(II) HOUSEHOLD ELECTION- A State agency that has not made the 
          use of a standard utility allowance mandatory under subclause (I)
          shall allow a household to switch, at the end of a certification
          period, between the standard utility allowance and a deduction 
          based on the actual utility costs of the household.
                        `(iv) AVAILABILITY OF ALLOWANCE TO RECIPIENTS OF
                      ENERGY ASSISTANCE-
            `(I) IN GENERAL- Subject to subclause (II), if a State agency
          elects to use a standard utility allowance that reflects heating or
          cooling costs, the standard utility allowance shall be made
          available to households receiving a payment, or on behalf of which 
          a payment is made, under the Low-Income Home Energy Assistance Act
          of 1981 (42 U.S.C. 8621 et seq.) or other similar energy assistance
          program, if the household still incurs out-of-pocket heating or
          cooling expenses in excess of any assistance paid on behalf of the
          household to an energy provider.
            `(II) SEPARATE ALLOWANCE- A State agency may use a separate
          standard utility allowance for households on behalf of which a
          payment described in subclause (I) is made, but may not be required
          to do so.
            `(III) STATES NOT ELECTING TO USE SEPARATE ALLOWANCE- A State
          agency that does not elect to use a separate allowance but makes a
          single standard utility allowance available to households incurring
          heating or cooling expenses (other than a household described in
          subclause (I) or (II) of clause (ii)) may not be required to reduce
          the allowance due to the provision (directly or indirectly) of
          assistance under the Low-Income Home Energy Assistance Act of 1981
          (42 U.S.C. 8621 et seq.).
            `(IV) PRORATION OF ASSISTANCE- For the purpose of the food stamp
          program, assistance provided under the Low-Income Home Energy
          Assistance Act of 1981 (42 U.S.C. 8621 et seq.) shall be considered
          to be prorated over the entire heating or cooling season for which
          the assistance was provided.'.
            (b) CONFORMING AMENDMENT- Section 11(e)(3) of the Food Stamp Act
          of 1977 (7 U.S.C. 2020(e)(3)) is amended by striking `. Under rules
          prescribed' and all that follows through `verifies higher expenses'.
          SEC. 810. VEHICLE ALLOWANCE.
            Section 5(g) of the Food Stamp Act of 1977 (7 U.S.C. 2014(g)) is
          amended by striking paragraph (2) and inserting the following:
                `(2) INCLUDED ASSETS- 
                    `(A) IN GENERAL- Subject to the other provisions of this
                  paragraph, the Secretary shall, in prescribing inclusions
                  in, and exclusions from, financial resources, follow the
                  regulations in force as of June 1, 1982 (other than those
                  relating to licensed vehicles and inaccessible resources).
                    `(B) ADDITIONAL INCLUDED ASSETS- The Secretary shall
                  include in financial resources--
                        `(i) any boat, snowmobile, or airplane used for
                      recreational purposes;
                        `(ii) any vacation home;
                        `(iii) any mobile home used primarily for vacation
                      purposes;
                        `(iv) subject to subparagraph (C), any licensed
                      vehicle that is used for household transportation or to
                      obtain or continue employment to the extent that the
                      fair market value of the vehicle exceeds $4,600 through
                      September 30, 1996, and $4,650 beginning October 1,
                      1996; and
                        `(v) any savings or retirement account (including an
                      individual account), regardless of whether there is a
                      penalty for early withdrawal.
                    `(C) EXCLUDED VEHICLES- A vehicle (and any other 
                  property, real or personal, to the extent the property is
                  directly related to the maintenance or use of the vehicle)
                  shall not be included in financial resources under this
                  paragraph if the vehicle is--
                        `(i) used to produce earned income;
                        `(ii) necessary for the transportation of a 
                      physically disabled household member; or
                        `(iii) depended on by a household to carry fuel for
                      heating or water for home use and provides the primary
                      source of fuel or water, respectively, for the
                      household.'.
          SEC. 811. VENDOR PAYMENTS FOR TRANSITIONAL HOUSING COUNTED AS INCOME.
            Section 5(k)(2) of the Food Stamp Act of 1977 (7 U.S.C.
          2014(k)(2)) is amended--
                (1) by striking subparagraph (F); and
                (2) by redesignating subparagraphs (G) and (H) as
              subparagraphs (F) and (G), respectively.
          SEC. 812. SIMPLIFIED CALCULATION OF INCOME FOR THE SELF-EMPLOYED.
            Section 5 of the Food Stamp Act of 1977 (7 U.S.C. 2014), as
          amended by title I, is amended by adding at the end the following:
            `(m) SIMPLIFIED CALCULATION OF INCOME FOR THE SELF-EMPLOYED- 
                `(1) IN GENERAL- Not later than 1 year after the date of
              enactment of this subsection, the Secretary shall establish a
              procedure by which a State may submit a method, designed to not
              increase Federal costs, for the approval of the Secretary, that
              the Secretary determines will produce a reasonable estimate of
              income excluded under subsection (d)(9) in lieu of calculating
              the actual cost of producing self-employment income.
                `(2) INCLUSIVE OF ALL TYPES OF INCOME OR LIMITED TYPES OF
              INCOME- The method submitted by a State under paragraph (1) may
              allow a State to estimate income for all types of
              self-employment income or may be limited to 1 or more types of
              self-employment income.
                `(3) DIFFERENCES FOR DIFFERENT TYPES OF INCOME- The method
              submitted by a State under paragraph (1) may differ for
              different types of self-employment income.'.
          SEC. 813. DOUBLED PENALTIES FOR VIOLATING FOOD STAMP PROGRAM
                            REQUIREMENTS.
            Section 6(b)(1) of the Food Stamp Act of 1977 (7 U.S.C.
          2015(b)(1)) is amended--
                (1) in clause (i), by striking `six months' and inserting `1
              year'; and
                (2) in clause (ii), by striking `1 year' and inserting `2
              years'.
          SEC. 814. DISQUALIFICATION OF CONVICTED INDIVIDUALS.
            Section 6(b)(1)(iii) of the Food Stamp Act of 1977 (7 U.S.C.
          2015(b)(1)(iii)) is amended--
                (1) in subclause (II), by striking `or' at the end;
                (2) in subclause (III), by striking the period at the end and
              inserting `; or'; and
                (3) by inserting after subclause (III) the following:
                    `(IV) a conviction of an offense under subsection (b) or
                  (c) of section 15 involving an item covered by subsection
                  (b) or (c) of section 15 having a value of $500 or more.'.
          SEC. 815. DISQUALIFICATION.
            (a) IN GENERAL- Section 6(d) of the Food Stamp Act of 1977 (7
          U.S.C. 2015(d)) is amended by striking `(d)(1) Unless otherwise
          exempted by the provisions' and all that follows through the end of
          paragraph (1) and inserting the following:
            `(d) CONDITIONS OF PARTICIPATION- 
                `(1) WORK REQUIREMENTS- 
                    `(A) IN GENERAL- No physically and mentally fit 
                  individual over the age of 15 and under the age of 60 shall
                  be eligible to participate in the food stamp program if the
                  individual--
                        `(i) refuses, at the time of application and every 12
                      months thereafter, to register for employment in a
                      manner prescribed by the Secretary;
                        `(ii) refuses without good cause to participate in an
                      employment and training program established under
                      paragraph (4), to the extent required by the State
                      agency;
                        `(iii) refuses without good cause to accept an offer
                      of employment, at a site or plant not subject to a
                      strike or lockout at the time of the refusal, at a wage
                      not less than the higher of--
            `(I) the applicable Federal or State minimum wage; or
            `(II) 80 percent of the wage that would have governed had the
          minimum hourly rate under section 6(a)(1) of the Fair Labor
          Standards Act of 1938 (29 U.S.C. 206(a)(1)) been applicable to the
          offer of employment;
                        `(iv) refuses without good cause to provide a State
                      agency with sufficient information to allow the State
                      agency to determine the employment status or the job
                      availability of the individual;
                        `(v) voluntarily and without good cause--
            `(I) quits a job; or
            `(II) reduces work effort and, after the reduction, the 
          individual is working less than 30 hours per week; or
                        `(vi) fails to comply with section 20.
                    `(B) HOUSEHOLD INELIGIBILITY- If an individual who is the
                  head of a household becomes ineligible to participate in 
                  the food stamp program under subparagraph (A), the 
                  household shall, at the option of the State agency, become
                  ineligible to participate in the food stamp program for a
                  period, determined by the State agency, that does not 
                  exceed the lesser of--
                        `(i) the duration of the ineligibility of the
                      individual determined under subparagraph (C); or
                        `(ii) 180 days.
                    `(C) DURATION OF INELIGIBILITY- 
                        `(i) FIRST VIOLATION- The first time that an
                      individual becomes ineligible to participate in the 
                      food stamp program under subparagraph (A), the
                      individual shall remain ineligible until the later of--
            `(I) the date the individual becomes eligible under subparagraph
          (A);
            `(II) the date that is 1 month after the date the individual
          became ineligible; or
            `(III) a date determined by the State agency that is not later
          than 3 months after the date the individual became ineligible.
                        `(ii) SECOND VIOLATION- The second time that an
                      individual becomes ineligible to participate in the 
                      food stamp program under subparagraph (A), the
                      individual shall remain ineligible until the later of--
            `(I) the date the individual becomes eligible under subparagraph
          (A);
            `(II) the date that is 3 months after the date the individual
          became ineligible; or
            `(III) a date determined by the State agency that is not later
          than 6 months after the date the individual became ineligible.
                        `(iii) THIRD OR SUBSEQUENT VIOLATION- The third or
                      subsequent time that an individual becomes ineligible 
                      to participate in the food stamp program under
                      subparagraph (A), the individual shall remain 
                      ineligible until the later of--
            `(I) the date the individual becomes eligible under subparagraph
          (A);
            `(II) the date that is 6 months after the date the individual
          became ineligible;
            `(III) a date determined by the State agency; or
            `(IV) at the option of the State agency, permanently.
                    `(D) ADMINISTRATION- 
                        `(i) GOOD CAUSE- The Secretary shall determine the
                      meaning of good cause for the purpose of this paragraph.
                        `(ii) VOLUNTARY QUIT- The Secretary shall determine
                      the meaning of voluntarily quitting and reducing work
                      effort for the purpose of this paragraph.
                        `(iii) DETERMINATION BY STATE AGENCY- 
            `(I) IN GENERAL- Subject to subclause (II) and clauses (i) and
          (ii), a State agency shall determine--
            `(aa) the meaning of any term used in subparagraph (A);
            `(bb) the procedures for determining whether an individual is in
          compliance with a requirement under subparagraph (A); and
            `(cc) whether an individual is in compliance with a requirement
          under subpara-graph (A).
            `(II) NOT LESS RESTRICTIVE- A State agency may not use a meaning,
          procedure, or determination under subclause (I) that is less
          restrictive on individuals receiving benefits under this Act than a
          comparable meaning, procedure, or determination under a State
          program funded under part A of title IV of the Social Security Act
          (42 U.S.C. 601 et seq.).
                        `(iv) STRIKE AGAINST THE GOVERNMENT- For the purpose
                      of subparagraph (A)(v), an employee of the Federal
                      Government, a State, or a political subdivision of a
                      State, who is dismissed for participating in a strike
                      against the Federal Government, the State, or the
                      political subdivision of the State shall be considered
                      to have voluntarily quit without good cause.
                        `(v) SELECTING A HEAD OF HOUSEHOLD- 
            `(I) IN GENERAL- For purposes of this paragraph, the State agency
          shall allow the household to select any adult parent of a child in
          the household as the head of the household if all adult household
          members making application under the food stamp program agree to 
          the selection.
            `(II) TIME FOR MAKING DESIGNATION- A household may designate the
          head of the household under subclause (I) each time the household 
          is certified for participation in the food stamp program, but may
          not change the designation during a certification period unless
          there is a change in the composition of the household.
                        `(vi) CHANGE IN HEAD OF HOUSEHOLD- If the head of a
                      household leaves the household during a period in which
                      the household is ineligible to participate in the food
                      stamp program under subparagraph (B)--
            `(I) the household shall, if otherwise eligible, become eligible
          to participate in the food stamp program; and
            `(II) if the head of the household becomes the head of another
          household, the household that becomes headed by the individual 
          shall become ineligible to participate in the food stamp program 
          for the remaining period of ineligibility.'.
            (b) CONFORMING AMENDMENT- 
                (1) The second sentence of section 17(b)(2) of the Food Stamp
              Act of 1977 (7 U.S.C. 2026(b)(2)) is amended by striking
              `6(d)(1)(i)' and inserting `6(d)(1)(A)(i)'.
                (2) Section 20 of the Food Stamp Act of 1977 (7 U.S.C. 2029)
              is amended by striking subsection (f) and inserting the
              following:
            `(f) DISQUALIFICATION- An individual or a household may become
          ineligible under section 6(d)(1) to participate in the food stamp
          program for failing to comply with this section.'.
          SEC. 816. CARETAKER EXEMPTION.
            Section 6(d)(2) of the Food Stamp Act of 1977 (7 U.S.C.
          2015(d)(2)) is amended by adding at the end the following: `A State
          that requested a waiver to lower the age specified in subparagraph
          (B) and had the waiver denied by the Secretary as of August 1, 
          1996, may, for a period of not more than 3 years, lower the age of 
          a dependent child that qualifies a parent or other member of a
          household for an exemption under subparagraph (B) to between 1 and 
          6 years of age.'.
          SEC. 817. EMPLOYMENT AND TRAINING.
            (a) IN GENERAL- Section 6(d)(4) of the Food Stamp Act of 1977 (7
          U.S.C. 2015(d)(4)) is amended--
                (1) by striking `(4)(A) Not later than April 1, 1987, each'
              and inserting the following:
                `(4) EMPLOYMENT AND TRAINING- 
                    `(A) IN GENERAL- 
                        `(i) IMPLEMENTATION- Each';
                (2) in subparagraph (A)--
                    (A) by inserting `work,' after `skills, training,'; and
                    (B) by adding at the end the following:
                        `(ii) STATEWIDE WORKFORCE DEVELOPMENT SYSTEM- Each
                      component of an employment and training program carried
                      out under this paragraph shall be delivered through a
                      statewide workforce development system, unless the
                      component is not available locally through such a
                      system.';
                (3) in subparagraph (B)--
                    (A) in the matter preceding clause (i), by striking the
                  colon at the end and inserting the following: `, except 
                  that the State agency shall retain the option to apply
                  employment requirements prescribed under this subparagraph
                  to a program applicant at the time of application:';
                    (B) in clause (i), by striking `with terms and 
                  conditions' and all that follows through `time of
                  application'; and
                    (C) in clause (iv)--
                        (i) by striking subclauses (I) and (II); and
                        (ii) by redesignating subclauses (III) and (IV) as
                      subclauses (I) and (II), respectively;
                (4) in subparagraph (D)--
                    (A) in clause (i), by striking `to which the application'
                  and all that follows through `30 days or less';
                    (B) in clause (ii), by striking `but with respect' and 
                  all that follows through `child care'; and
                    (C) in clause (iii), by striking `, on the basis of' and
                  all that follows through `clause (ii)' and inserting `the
                  exemption continues to be valid';
                (5) in subparagraph (E), by striking the third sentence;
                (6) in subparagraph (G)--
                    (A) by striking `(G)(i) The State' and inserting `(G) The
                  State'; and
                    (B) by striking clause (ii);
                (7) in subparagraph (H), by striking `(H)(i) The Secretary'
              and all that follows through `(ii) Federal funds' and inserting
              `(H) Federal funds';
                (8) in subparagraph (I)(i)(II), by striking `, or was in
              operation,' and all that follows through `Social Security Act'
              and inserting the following: `), except that no such payment or
              reimbursement shall exceed the applicable local market rate';
                (9)(A) by striking subparagraphs (K) and (L) and inserting 
              the following:
                    `(K) LIMITATION ON FUNDING- Notwithstanding any other
                  provision of this paragraph, the amount of funds a State
                  agency uses to carry out this paragraph (including funds
                  used to carry out subparagraph (I)) for participants who 
                  are receiving benefits under a State program funded under
                  part A of title IV of the Social Security Act (42 U.S.C. 
                  601 et seq.) shall not exceed the amount of funds the State
                  agency used in fiscal year 1995 to carry out this paragraph
                  for participants who were receiving benefits in fiscal year
                  1995 under a State program funded under part A of title IV
                  of the Act (42 U.S.C. 601 et seq.).'; and
                (B) by redesignating subparagraphs (M) and (N) as
              subparagraphs (L) and (M), respectively; and
                (10) in subparagraph (L), as so redesignated--
                    (A) by striking `(L)(i) The Secretary' and inserting `(L)
                  The Secretary'; and
                    (B) by striking clause (ii).
            (b) FUNDING- Section 16(h) of the Food Stamp Act of 1977 (7 
          U.S.C. 2025(h)) is amended by striking `(h)(1)(A) The Secretary' 
          and all that follows through the end of paragraph (1) and inserting
          the following:
            `(h) FUNDING OF EMPLOYMENT AND TRAINING PROGRAMS- 
                `(1) IN GENERAL- 
                    `(A) AMOUNTS- To carry out employment and training
                  programs, the Secretary shall reserve for allocation to
                  State agencies from funds made available for each fiscal
                  year under section 18(a)(1) the amount of--
                        `(i) for fiscal year 1996, $75,000,000;
                        `(ii) for fiscal year 1997, $79,000,000;
                        `(iii) for fiscal year 1998, $81,000,000;
                        `(iv) for fiscal year 1999, $84,000,000;
                        `(v) for fiscal year 2000, $86,000,000;
                        `(vi) for fiscal year 2001, $88,000,000; and
                        `(vii) for fiscal year 2002, $90,000,000.
                    `(B) ALLOCATION- The Secretary shall allocate the amounts
                  reserved under subparagraph (A) among the State agencies
                  using a reasonable formula (as determined by the Secretary)
                  that gives consideration to the population in each State
                  affected by section 6(o).
                    `(C) REALLOCATION- 
                        `(i) NOTIFICATION- A State agency shall promptly
                      notify the Secretary if the State agency determines 
                      that the State agency will not expend all of the funds
                      allocated to the State agency under subparagraph (B).
                        `(ii) REALLOCATION- On notification under clause (i),
                      the Secretary shall reallocate the funds that the State
                      agency will not expend as the Secretary considers
                      appropriate and equitable.
                    `(D) MINIMUM ALLOCATION- Notwithstanding subparagraphs 
                  (A) through (C), the Secretary shall ensure that each State
                  agency operating an employment and training program shall
                  receive not less than $50,000 for each fiscal year.'.
            (c) ADDITIONAL MATCHING FUNDS- Section 16(h)(2) of the Food Stamp
          Act of 1977 (7 U.S.C. 2025(h)(2)) is amended by inserting before 
          the period at the end the following: `, including the costs for 
          case management and casework to facilitate the transition from
          economic dependency to self-sufficiency through work'.
            (d) REPORTS- Section 16(h) of the Food Stamp Act of 1977 (7 
          U.S.C. 2025(h)) is amended--
                (1) in paragraph (5)--
                    (A) by striking `(5)(A) The Secretary' and inserting `(5)
                  The Secretary'; and
                    (B) by striking subparagraph (B); and
                (2) by striking paragraph (6).
          SEC. 818. FOOD STAMP ELIGIBILITY.
            The third sentence of section 6(f) of the Food Stamp Act of 1977
          (7 U.S.C. 2015(f)) is amended by inserting `, at State option,'
          after `less'.
          SEC. 819. COMPARABLE TREATMENT FOR DISQUALIFICATION.
            (a) IN GENERAL- Section 6 of the Food Stamp Act of 1977 (7 U.S.C.
          2015) is amended by adding at the end the following:
            `(i) COMPARABLE TREATMENT FOR DISQUALIFICATION- 
                `(1) IN GENERAL- If a disqualification is imposed on a member
              of a household for a failure of the member to perform an action
              required under a Federal, State, or local law relating to a
              means-tested public assistance program, the State agency may
              impose the same disqualification on the member of the household
              under the food stamp program.
                `(2) RULES AND PROCEDURES- If a disqualification is imposed
              under paragraph (1) for a failure of an individual to perform 
              an action required under part A of title IV of the Social
              Security Act (42 U.S.C. 601 et seq.), the State agency may use
              the rules and procedures that apply under part A of title IV of
              the Act to impose the same disqualification under the food 
              stamp program.
                `(3) APPLICATION AFTER DISQUALIFICATION PERIOD- A member of a
              household disqualified under paragraph (1) may, after the
              disqualification period has expired, apply for benefits under
              this Act and shall be treated as a new applicant, except that a
              prior disqualification under subsection (d) shall be considered
              in determining eligibility.'.
            (b) STATE PLAN PROVISIONS- Section 11(e) of the Food Stamp Act of
          1977 (7 U.S.C. 2020(e)) is amended--
                (1) in paragraph (24), by striking `and' at the end;
                (2) in paragraph (25), by striking the period at the end and
              inserting a semicolon; and
                (3) by adding at the end the following:
                `(26) the guidelines the State agency uses in carrying out
              section 6(i); and'.
            (c) CONFORMING AMENDMENT- Section 6(d)(2)(A) of the Food Stamp 
          Act of 1977 (7 U.S.C. 2015(d)(2)(A)) is amended by striking `that 
          is comparable to a requirement of paragraph (1)'.
          SEC. 820. DISQUALIFICATION FOR RECEIPT OF MULTIPLE FOOD STAMP
                            BENEFITS.
            Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as
          amended by section 819, is amended by adding at the end the
          following:
            `(j) DISQUALIFICATION FOR RECEIPT OF MULTIPLE FOOD STAMP 
          BENEFITS- An individual shall be ineligible to participate in the
          food stamp program as a member of any household for a 10-year 
          period if the individual is found by a State agency to have made, 
          or is convicted in a Federal or State court of having made, a
          fraudulent statement or representation with respect to the identity
          or place of residence of the individual in order to receive 
          multiple benefits simultaneously under the food stamp program.'.
          SEC. 821. DISQUALIFICATION OF FLEEING FELONS.
            Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as
          amended by section 820, is amended by adding at the end the
          following:
            `(k) DISQUALIFICATION OF FLEEING FELONS- No member of a household
          who is otherwise eligible to participate in the food stamp program
          shall be eligible to participate in the program as a member of that
          or any other household during any period during which the 
          individual is--
                `(1) fleeing to avoid prosecution, or custody or confinement
              after conviction, under the law of the place from which the
              individual is fleeing, for a crime, or attempt to commit a
              crime, that is a felony under the law of the place from which
              the individual is fleeing or that, in the case of New Jersey, 
              is a high misdemeanor under the law of New Jersey; or
                `(2) violating a condition of probation or parole imposed
              under a Federal or State law.'.
          SEC. 822. COOPERATION WITH CHILD SUPPORT AGENCIES.
            Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as
          amended by section 821, is amended by adding at the end the
          following:
            `(l) CUSTODIAL PARENT'S COOPERATION WITH CHILD SUPPORT AGENCIES- 
                `(1) IN GENERAL- At the option of a State agency, subject to
              paragraphs (2) and (3), no natural or adoptive parent or other
              individual (collectively referred to in this subsection as `the
              individual') who is living with and exercising parental control
              over a child under the age of 18 who has an absent parent shall
              be eligible to participate in the food stamp program unless the
              individual cooperates with the State agency administering the
              program established under part D of title IV of the Social
              Security Act (42 U.S.C. 651 et seq.)--
                    `(A) in establishing the paternity of the child (if the
                  child is born out of wedlock); and
                    `(B) in obtaining support for--
                        `(i) the child; or
                        `(ii) the individual and the child.
                `(2) GOOD CAUSE FOR NONCOOPERATION- Paragraph (1) shall not
              apply to the individual if good cause is found for refusing to
              cooperate, as determined by the State agency in accordance with
              standards prescribed by the Secretary in consultation with the
              Secretary of Health and Human Services. The standards shall 
              take into consideration circumstances under which cooperation
              may be against the best interests of the child.
                `(3) FEES- Paragraph (1) shall not require the payment of a
              fee or other cost for services provided under part D of title 
              IV of the Social Security Act (42 U.S.C. 651 et seq.).
            `(m) NONCUSTODIAL PARENT'S COOPERATION WITH CHILD SUPPORT
          AGENCIES-
                `(1) IN GENERAL- At the option of a State agency, subject to
              paragraphs (2) and (3), a putative or identified noncustodial
              parent of a child under the age of 18 (referred to in this
              subsection as `the individual') shall not be eligible to
              participate in the food stamp program if the individual refuses
              to cooperate with the State agency administering the program
              established under part D of title IV of the Social Security Act
              (42 U.S.C. 651 et seq.)--
                    `(A) in establishing the paternity of the child (if the
                  child is born out of wedlock); and
                    `(B) in providing support for the child.
                `(2) REFUSAL TO COOPERATE- 
                    `(A) GUIDELINES- The Secretary, in consultation with the
                  Secretary of Health and Human Services, shall develop
                  guidelines on what constitutes a refusal to cooperate under
                  paragraph (1).
                    `(B) PROCEDURES- The State agency shall develop
                  procedures, using guidelines developed under subparagraph
                  (A), for determining whether an individual is refusing to
                  cooperate under paragraph (1).
                `(3) FEES- Paragraph (1) shall not require the payment of a
              fee or other cost for services provided under part D of title 
              IV of the Social Security Act (42 U.S.C. 651 et seq.).
                `(4) PRIVACY- The State agency shall provide safeguards to
              restrict the use of information collected by a State agency
              administering the program established under part D of title IV
              of the Social Security Act (42 U.S.C. 651 et seq.) to purposes
              for which the information is collected.'.
          SEC. 823. DISQUALIFICATION RELATING TO CHILD SUPPORT ARREARS.
            Section 6 of the Food Stamp Act of 1977 (7 U.S.C. 2015), as
          amended by section 822, is amended by adding at the end the
          following:
            `(n) DISQUALIFICATION FOR CHILD SUPPORT ARREARS- 
                `(1) IN GENERAL- At the option of a State agency, no
              individual shall be eligible to participate in the food stamp
              program as a member of any household during any month that the
              individual is delinquent in any payment due under a court order
              for the support of a child of the individual.
                `(2) EXCEPTIONS- Paragraph (1) shall not apply if--
                    `(A) a court is allowing the individual to delay payment;
                  or
                    `(B) the individual is complying with a payment plan
                  approved by a court or the State agency designated under
                  part D of title IV of the Social Security Act (42 U.S.C. 
                  651 et seq.) to provide support for the child of the
                  individual.'.
          SEC. 824. WORK REQUIREMENT.
            (a) IN GENERAL- Section 6 of the Food Stamp Act of 1977 (7 U.S.C.
          2015), as amended by section 823, is amended by adding at the end
          the following:
            `(o) WORK REQUIREMENT- 
                `(1) DEFINITION OF WORK PROGRAM- In this subsection, the term
              `work program' means--
                    `(A) a program under the Job Training Partnership Act (29
                  U.S.C. 1501 et seq.);
                    `(B) a program under section 236 of the Trade Act of 1974
                  (19 U.S.C. 2296); and
                    `(C) a program of employment and training operated or
                  supervised by a State or political subdivision of a State
                  that meets standards approved by the Governor of the State,
                  including a program under subsection (d)(4), other than a
                  job search program or a job search training program.
                `(2) WORK REQUIREMENT- Subject to the other provisions of 
              this subsection, no individual shall be eligible to participate
              in the food stamp program as a member of any household if,
              during the preceding 36-month period, the individual received
              food stamp benefits for not less than 3 months (consecutive or
              otherwise) during which the individual did not--
                    `(A) work 20 hours or more per week, averaged monthly;
                    `(B) participate in and comply with the requirements of a
                  work program for 20 hours or more per week, as determined 
                  by the State agency;
                    `(C) participate in and comply with the requirements of a
                  program under section 20 or a comparable program 
                  established by a State or political subdivision of a State;
                  or
                    `(D) receive benefits pursuant to paragraph (3), (4), or
                  (5).
                `(3) EXCEPTION- Paragraph (2) shall not apply to an 
              individual if the individual is--
                    `(A) under 18 or over 50 years of age;
                    `(B) medically certified as physically or mentally unfit
                  for employment;
                    `(C) a parent or other member of a household with
                  responsibility for a dependent child;
                    `(D) otherwise exempt under subsection (d)(2); or
                    `(E) a pregnant woman.
                `(4) WAIVER- 
                    `(A) IN GENERAL- On the request of a State agency, the
                  Secretary may waive the applicability of paragraph (2) to
                  any group of individuals in the State if the Secretary 
                  makes a determination that the area in which the
                  indi-viduals reside--
                        `(i) has an unemployment rate of over 10 per-cent; or
                        `(ii) does not have a sufficient number of jobs to
                      provide employment for the individuals.
                    `(B) REPORT- The Secretary shall report the basis for a
                  waiver under subparagraph (A) to the Committee on
                  Agriculture of the House of Representatives and the
                  Committee on Agriculture, Nutrition, and Forestry of the
                  Senate.
                `(5) SUBSEQUENT ELIGIBILITY- 
                    `(A) REGAINING ELIGIBILITY- An individual denied
                  eligibility under paragraph (2) shall regain eligibility to
                  participate in the food stamp program if, during a 30-day
                  period, the individual--
                        `(i) works 80 or more hours;
                        `(ii) participates in and complies with the
                      requirements of a work program for 80 or more hours, as
                      determined by a State agency; or
                        `(iii) participates in and complies with the
                      requirements of a program under section 20 or a
                      comparable program established by a State or political
                      subdivision of a State.
                    `(B) MAINTAINING ELIGIBILITY- An individual who regains
                  eligibility under subparagraph (A) shall remain eligible as
                  long as the individual meets the requirements of
                  subparagraph (A), (B), or (C) of paragraph (2).
                    `(C) LOSS OF EMPLOYMENT- 
                        `(i) IN GENERAL- An individual who regained
                      eligibility under subparagraph (A) and who no longer
                      meets the requirements of subparagraph (A), (B), or (C)
                      of paragraph (2) shall remain eligible for a 
                      consecutive 3-month period, beginning on the date the
                      individual first notifies the State agency that the
                      individual no longer meets the requirements of
                      subparagraph (A), (B), or (C) of paragraph (2).
                        `(ii) LIMITATION- An individual shall not receive any
                      benefits pursuant to clause (i) for more than a single
                      3-month period in any 36-month period.
                `(6) OTHER PROGRAM RULES- Nothing in this subsection shall
              make an individual eligible for benefits under this Act if the
              individual is not otherwise eligible for benefits under the
              other provisions of this Act.'.
            (b) TRANSITION PROVISION- The term `preceding 36-month period' in
          section 6(o) of the Food Stamp Act of 1977, as added by subsection
          (a), does not include, with respect to a State, any period before
          the earlier of--
                (1) the date the State notifies recipients of food stamp
              benefits of the application of section 6(o); or
                (2) the date that is 3 months after the date of enactment of
              this Act.
          SEC. 825. ENCOURAGEMENT OF ELECTRONIC BENEFIT TRANSFER SYSTEMS.
            (a) IN GENERAL- Section 7(i) of the Food Stamp Act of 1977 (7
          U.S.C. 2016(i)) is amended--
                (1) by striking `(i)(1)(A) Any State' and all that follows
              through the end of paragraph (1) and inserting the following:
            `(i) ELECTRONIC BENEFIT TRANSFERS- 
                `(1) IN GENERAL- 
                    `(A) IMPLEMENTATION- Not later than October 1, 2002, each
                  State agency shall implement an electronic benefit transfer
                  system under which household benefits determined under
                  section 8(a) or 26 are issued from and stored in a central
                  databank, unless the Secretary provides a waiver for a 
                  State agency that faces unusual barriers to implementing an
                  electronic benefit transfer system.
                    `(B) TIMELY IMPLEMENTATION- Each State agency is
                  encouraged to implement an electronic benefit transfer
                  system under subparagraph (A) as soon as practicable.
                    `(C) STATE FLEXIBILITY- Subject to paragraph (2), a State
                  agency may procure and implement an electronic benefit
                  transfer system under the terms, conditions, and design 
                  that the State agency considers appropriate.
                    `(D) OPERATION- An electronic benefit transfer system
                  should take into account generally accepted standard
                  operating rules based on--
                        `(i) commercial electronic funds transfer technology;
                        `(ii) the need to permit interstate operation and law
                      enforcement monitoring; and
                        `(iii) the need to permit monitoring and
                      investigations by authorized law enforcement agencies.';
                (2) in paragraph (2)--
                    (A) by striking `effective no later than April 1, 1992,';
                    (B) in subparagraph (A)--
                        (i) by striking `, in any 1 year,'; and
                        (ii) by striking `on-line';
                    (C) by striking subparagraph (D) and inserting the
                  following:
                    `(D)(i) measures to maximize the security of a system
                  using the most recent technology available that the State
                  agency considers appropriate and cost effective and which
                  may include personal identification numbers, photographic
                  identification on electronic benefit transfer cards, and
                  other measures to protect against fraud and abuse; and
                    `(ii) effective not later than 2 years after the date of
                  enactment of this clause, to the extent practicable,
                  measures that permit a system to differentiate items of 
                  food that may be acquired with an allotment from items of
                  food that may not be acquired with an allotment;';
                    (D) in subparagraph (G), by striking `and' at the end;
                    (E) in subparagraph (H), by striking the period at the 
                  end and inserting `; and'; and
                    (F) by adding at the end the following:
                `(I) procurement standards.'; and
                (3) by adding at the end the following:
                `(7) REPLACEMENT OF BENEFITS- Regulations issued by the
              Secretary regarding the replacement of benefits and liability
              for replacement of benefits under an electronic benefit 
              transfer system shall be similar to the regulations in effect
              for a paper-based food stamp issuance system.
                `(8) REPLACEMENT CARD FEE- A State agency may collect a 
              charge for replacement of an electronic benefit transfer card 
              by reducing the monthly allotment of the household receiving 
              the replacement card.
                `(9) OPTIONAL PHOTOGRAPHIC IDENTIFICATION- 
                    `(A) IN GENERAL- A State agency may require that an
                  electronic benefit card contain a photograph of 1 or more
                  members of a household.
                    `(B) OTHER AUTHORIZED USERS- If a State agency requires a
                  photograph on an electronic benefit card under subparagraph
                  (A), the State agency shall establish procedures to ensure
                  that any other appropriate member of the household or any
                  authorized representative of the household may utilize the
                  card.
                `(10) APPLICABLE LAW- Disclosures, protections,
              responsibilities, and remedies established by the Federal
              Reserve Board under section 904 of the Electronic Fund Transfer
              Act (15 U.S.C. 1693b) shall not apply to benefits under this 
              Act delivered through any electronic benefit transfer system.
                `(11) APPLICATION OF ANTI-TYING RESTRICTIONS TO ELECTRONIC
              BENEFIT TRANSFER SYSTEMS-
                    `(A) DEFINITIONS- In this paragraph:
                        `(i) AFFILIATE- The term `affiliate' has the meaning
                      provided the term in section 2(k) of the Bank Holding
                      Company Act of 1956 (12 U.S.C. 1841(k)).
                        `(ii) COMPANY- The term `company' has the meaning
                      provided the term in section 106(a) of the Bank Holding
                      Company Act Amendments of 1970 (12 U.S.C. 1971), but
                      shall not include a bank, a bank holding company, or 
                      any subsidiary of a bank holding company.
                        `(iii) ELECTRONIC BENEFIT TRANSFER SERVICE- The term
                      `electronic benefit transfer service' means the
                      processing of electronic transfers of household
                      benefits, determined under section 8(a) or 26, if the
                      benefits are--
            `(I) issued from and stored in a central databank;
            `(II) electronically accessed by household members at the point 
          of sale; and
            `(III) provided by a Federal or State government.
                        `(iv) POINT-OF-SALE SERVICE- The term `point-of-sale
                      service' means any product or service related to the
                      electronic authorization and processing of payments for
                      merchandise at a retail food store, including credit or
                      debit card services, automated teller machines,
                      point-of-sale terminals, or access to on-line systems.
                    `(B) RESTRICTIONS- A company may not sell or provide
                  electronic benefit transfer services, or fix or vary the
                  consideration for electronic benefit transfer services, on
                  the condition or requirement that the customer--
                        `(i) obtain some additional point-of-sale service 
                      from the company or an affiliate of the company; or
                        `(ii) not obtain some additional point-of-sale 
                      service from a competitor of the company or competitor
                      of any affiliate of the company.
                    `(C) CONSULTATION WITH THE FEDERAL RESERVE BOARD- Before
                  promulgating regulations or interpretations of regulations
                  to carry out this paragraph, the Secretary shall consult
                  with the Board of Governors of the Federal Reserve System.'.
            (b) SENSE OF CONGRESS- It is the sense of Congress that a State
          that operates an electronic benefit transfer system under the Food
          Stamp Act of 1977 (7 U.S.C. 2011 et seq.) should operate the system
          in a manner that is compatible with electronic benefit transfer
          systems operated by other States.
          SEC. 826. VALUE OF MINIMUM ALLOTMENT.
            The proviso in section 8(a) of the Food Stamp Act of 1977 (7
          U.S.C. 2017(a)) is amended by striking `, and shall be adjusted' 
          and all that follows through `$5'.
          SEC. 827. BENEFITS ON RECERTIFICATION.
            Section 8(c)(2)(B) of the Food Stamp Act of 1977 (7 U.S.C.
          2017(c)(2)(B)) is amended by striking `of more than one month'.
          SEC. 828. OPTIONAL COMBINED ALLOTMENT FOR EXPEDITED HOUSEHOLDS.
            Section 8(c) of the Food Stamp Act of 1977 (7 U.S.C. 2017(c)) is
          amended by striking paragraph (3) and inserting the following:
                `(3) OPTIONAL COMBINED ALLOTMENT FOR EXPEDITED HOUSEHOLDS- A
              State agency may provide to an eligible household applying 
              after the 15th day of a month, in lieu of the initial allotment
              of the household and the regular allotment of the household for
              the following month, an allotment that is equal to the total
              amount of the initial allotment and the first regular 
              allotment. The allotment shall be provided in accordance with
              section 11(e)(3) in the case of a household that is not 
              entitled to expedited service and in accordance with paragraphs
              (3) and (9) of section 11(e) in the case of a household that is
              entitled to expedited service.'.
          SEC. 829. FAILURE TO COMPLY WITH OTHER MEANS-TESTED PUBLIC
                            ASSISTANCE PROGRAMS.
            Section 8 of the Food Stamp Act of 1977 (7 U.S.C. 2017) is 
          amended by striking subsection (d) and inserting the following:
            `(d) REDUCTION OF PUBLIC ASSISTANCE BENEFITS- 
                `(1) IN GENERAL- If the benefits of a household are reduced
              under a Federal, State, or local law relating to a means-tested
              public assistance program for the failure of a member of the
              household to perform an action required under the law or
              program, for the duration of the reduction--
                    `(A) the household may not receive an increased allotment
                  as the result of a decrease in the income of the household
                  to the extent that the decrease is the result of the
                  reduction; and
                    `(B) the State agency may reduce the allotment of the
                  household by not more than 25 percent.
                `(2) RULES AND PROCEDURES- If the allotment of a household is
              reduced under this subsection for a failure to perform an 
              action required under part A of title IV of the Social Security
              Act (42 U.S.C. 601 et seq.), the State agency may use the rules
              and procedures that apply under part A of title IV of the Act 
              to reduce the allotment under the food stamp program.'.
          SEC. 830. ALLOTMENTS FOR HOUSEHOLDS RESIDING IN CENTERS.
            Section 8 of the Food Stamp Act of 1977 (7 U.S.C. 2017) is 
          amended by adding at the end the following:
            `(f) ALLOTMENTS FOR HOUSEHOLDS RESIDING IN CENTERS- 
                `(1) IN GENERAL- In the case of an individual who resides in 
              a center for the purpose of a drug or alcoholic treatment
              program described in the last sentence of section 3(i), a State
              agency may provide an allotment for the individual to--
                    `(A) the center as an authorized representative of the
                  individual for a period that is less than 1 month; and
                    `(B) the individual, if the individual leaves the center.
                `(2) DIRECT PAYMENT- A State agency may require an individual
              referred to in paragraph (1) to designate the center in which
              the individual resides as the authorized representative of the
              individual for the purpose of receiving an allotment.'.
          SEC. 831. CONDITION PRECEDENT FOR APPROVAL OF RETAIL FOOD STORES 
                            AND WHOLESALE FOOD CONCERNS.
            Section 9(a)(1) of the Food Stamp Act of 1977 (7 U.S.C.
          2018(a)(1)) is amended by adding at the end the following: `No
          retail food store or wholesale food concern of a type determined by
          the Secretary, based on factors that include size, location, and
          type of items sold, shall be approved to be authorized or
          reauthorized for participation in the food stamp program unless an
          authorized employee of the Department of Agriculture, a designee of
          the Secretary, or, if practicable, an official of the State or 
          local government designated by the Secretary has visited the store
          or concern for the purpose of determining whether the store or
          concern should be approved or reauthorized, as appropriate.'.
          SEC. 832. AUTHORITY TO ESTABLISH AUTHORIZATION PERIODS.
            Section 9(a) of the Food Stamp Act of 1977 (7 U.S.C. 2018(a)) is
          amended by adding at the end the following:
                `(3) AUTHORIZATION PERIODS- The Secretary shall establish
              specific time periods during which authorization to accept and
              redeem coupons, or to redeem benefits through an electronic
              benefit transfer system, shall be valid under the food stamp
              program.'.
          SEC. 833. INFORMATION FOR VERIFYING ELIGIBILITY FOR AUTHORIZATION.
            Section 9(c) of the Food Stamp Act of 1977 (7 U.S.C. 2018(c)) is
          amended--
                (1) in the first sentence, by inserting `, which may include
              relevant income and sales tax filing documents,' after `submit
              information'; and
                (2) by inserting after the first sentence the following: `The
              regulations may require retail food stores and wholesale food
              concerns to provide written authorization for the Secretary to
              verify all relevant tax filings with appropriate agencies and 
              to obtain corroborating documentation from other sources so 
              that the accuracy of information provided by the stores and
              concerns may be verified.'.
          SEC. 834. WAITING PERIOD FOR STORES THAT FAIL TO MEET AUTHORIZATION
                            CRITERIA.
            Section 9(d) of the Food Stamp Act of 1977 (7 U.S.C. 2018(d)) is
          amended by adding at the end the following: `A retail food store or
          wholesale food concern that is denied approval to accept and redeem
          coupons because the store or concern does not meet criteria for
          approval established by the Secretary may not, for at least 6
          months, submit a new application to participate in the program. The
          Secretary may establish a longer time period under the preceding
          sentence, including permanent disqualification, that reflects the
          severity of the basis of the denial.'.
          SEC. 835. OPERATION OF FOOD STAMP OFFICES.
            Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020), as
          amended by sections 809(b) and 819(b), is amended--
                (1) in subsection (e)--
                    (A) by striking paragraph (2) and inserting the following:
                `(2)(A) that the State agency shall establish procedures
              governing the operation of food stamp offices that the State
              agency determines best serve households in the State, including
              households with special needs, such as households with elderly
              or disabled members, households in rural areas with low-income
              members, homeless individuals, households residing on
              reservations, and households in areas in which a substantial
              number of members of low-income households speak a language
              other than English.
                `(B) In carrying out subparagraph (A), a State agency--
                    `(i) shall provide timely, accurate, and fair service to
                  applicants for, and participants in, the food stamp program;
                    `(ii) shall develop an application containing the
                  information necessary to comply with this Act;
                    `(iii) shall permit an applicant household to apply to
                  participate in the program on the same day that the
                  household first contacts a food stamp office in person
                  during office hours;
                    `(iv) shall consider an application that contains the
                  name, address, and signature of the applicant to be filed 
                  on the date the applicant submits the application;
                    `(v) shall require that an adult representative of each
                  applicant household certify in writing, under penalty of
                  perjury, that--
                        `(I) the information contained in the application is
                      true; and
                        `(II) all members of the household are citizens or 
                      are aliens eligible to receive food stamps under 
                      section 6(f);
                    `(vi) shall provide a method of certifying and issuing
                  coupons to eligible homeless individuals, to ensure that
                  participation in the food stamp program is limited to
                  eligible households; and
                    `(vii) may establish operating procedures that vary for
                  local food stamp offices to reflect regional and local
                  differences within the State.
                `(C) Nothing in this Act shall prohibit the use of signatures
              provided and maintained electronically, storage of records 
              using automated retrieval systems only, or any other feature of
              a State agency's application system that does not rely
              exclusively on the collection and retention of paper
              applications or other records.
                `(D) The signature of any adult under this paragraph shall be
              considered sufficient to comply with any provision of Federal
              law requiring a household member to sign an application or
              statement;';
                    (B) in paragraph (3)--
                        (i) by striking `shall--' and all that follows 
                      through `provide each' and inserting `shall provide
                      each'; and
                        (ii) by striking `(B) assist' and all that follows
                      through `representative of the State agency;';
                    (C) by striking paragraphs (14) and (25);
                    (D)(i) by redesignating paragraphs (15) through (24) as
                  paragraphs (14) through (23), respectively; and
                    (ii) by redesignating paragraph (26), as paragraph (24);
                  and
                (2) in subsection (i)--
                    (A) by striking `(i) Notwithstanding' and all that 
                  follows through `(2)' and inserting the following:
            `(i) APPLICATION AND DENIAL PROCEDURES- 
                `(1) APPLICATION PROCEDURES- Notwithstanding any other
              provision of law,'; and
                    (B) by striking `; (3) households' and all that follows
                  through `title IV of the Social Security Act. No' and
                  inserting a period and the following:
                `(2) DENIAL AND TERMINATION- Except in a case of
              disqualification as a penalty for failure to comply with a
              public assistance program rule or regulation, no'.
          SEC. 836. STATE EMPLOYEE AND TRAINING STANDARDS.
            Section 11(e)(6) of the Food Stamp Act of 1977 (7 U.S.C.
          2020(e)(6)) is amended--
                (1) by striking `that (A) the' and inserting `that--
                    `(A) the';
                (2) by striking `Act; (B) the' and inserting `Act; and
                    `(B) the';
                (3) in subparagraph (B), by striking `United States Civil
              Service Commission' and inserting `Office of Personnel
              Management'; and
                (4) by striking subparagraphs (C) through (E).
          SEC. 837. EXCHANGE OF LAW ENFORCEMENT INFORMATION.
            Section 11(e)(8) of the Food Stamp Act of 1977 (7 U.S.C.
          2020(e)(8)) is amended--
                (1) by striking `that (A) such' and inserting the follow-ing:
              `that--
                    `(A) the';
                (2) by striking `law, (B) notwithstanding' and inserting the
              following: `law;
                    `(B) notwithstanding';
                (3) by striking `Act, and (C) such' and inserting the
              following: `Act;
                    `(C) the'; and
                (4) by adding at the end the following:
                    `(D) notwithstanding any other provision of law, the
                  address, social security number, and, if available,
                  photograph of any member of a household shall be made
                  available, on request, to any Federal, State, or local law
                  enforcement officer if the officer furnishes the State
                  agency with the name of the member and notifies the agency
                  that--
                        `(i) the member--
            `(I) is fleeing to avoid prosecution, or custody or confinement
          after conviction, for a crime (or attempt to commit a crime) that,
          under the law of the place the member is fleeing, is a felony (or,
          in the case of New Jersey, a high misdemeanor), or is violating a
          condition of probation or parole imposed under Federal or State 
          law; or
            `(II) has information that is necessary for the officer to 
          conduct an official duty related to subclause (I);
                        `(ii) locating or apprehending the member is an
                      official duty; and
                        `(iii) the request is being made in the proper
                      exercise of an official duty; and
                    `(E) the safeguards shall not prevent compliance with
                  paragraph (16);'.
          SEC. 838. EXPEDITED COUPON SERVICE.
            Section 11(e)(9) of the Food Stamp Act of 1977 (7 U.S.C.
          2020(e)(9)) is amended--
                (1) in subparagraph (A), by striking `five days' and 
              inserting `7 days';
                (2) by striking subparagraph (B);
                (3) by redesignating subparagraphs (C) and (D) as
              subparagraphs (B) and (C);
                (4) in subparagraph (B), as redesignated by paragraph (3), by
              striking `five days' and inserting `7 days'; and
                (5) in subparagraph (C), as redesignated by paragraph (3), by
              striking `, (B), or (C)' and inserting `or (B)'.
          SEC. 839. WITHDRAWING FAIR HEARING REQUESTS.
            Section 11(e)(10) of the Food Stamp Act of 1977 (7 U.S.C.
          2020(e)(10)) is amended by inserting before the semicolon at the 
          end a period and the following: `At the option of a State, at any
          time prior to a fair hearing determination under this paragraph, a
          household may withdraw, orally or in writing, a request by the
          household for the fair hearing. If the withdrawal request is an 
          oral request, the State agency shall provide a written notice to 
          the household confirming the withdrawal request and providing the
          household with an opportunity to request a hearing'.
          SEC. 840. INCOME, ELIGIBILITY, AND IMMIGRATION STATUS VERIFICATION
                            SYSTEMS.
            Section 11 of the Food Stamp Act of 1977 (7 U.S.C. 2020) is
          amended--
                (1) in subsection (e)(18), as redesignated by section
              835(1)(D)--
                    (A) by striking `that information is' and inserting `at
                  the option of the State agency, that information may be'; and
                    (B) by striking `shall be requested' and inserting `may 
                  be requested'; and
                (2) by adding at the end the following:
            `(p) STATE VERIFICATION OPTION- Notwithstanding any other
          provision of law, in carrying out the food stamp program, a State
          agency shall not be required to use an income and eligibility or an
          immigration status verification system established under section
          1137 of the Social Security Act (42 U.S.C. 1320b-7).'.
          SEC. 841. INVESTIGATIONS.
            Section 12(a) of the Food Stamp Act of 1977 (7 U.S.C. 2021(a)) is
          amended by adding at the end the following: `Regulations issued
          pursuant to this Act shall provide criteria for the finding of a
          violation and the suspension or disqualification of a retail food
          store or wholesale food concern on the basis of evidence that may
          include facts established through on-site investigations,
          inconsistent redemption data, or evidence obtained through a
          transaction report under an electronic benefit transfer system.'.
          SEC. 842. DISQUALIFICATION OF RETAILERS WHO INTENTIONALLY SUBMIT
                            FALSIFIED APPLICATIONS.
            Section 12(b) of the Food Stamp Act of 1977 (7 U.S.C. 2021(b)) is
          amended--
                (1) in paragraph (2), by striking `and' at the end;
                (2) in paragraph (3), by striking the period at the end and
              inserting `; and'; and
                (3) by adding at the end the following:
                `(4) for a reasonable period of time to be determined by the
              Secretary, including permanent disqualification, on the knowing
              submission of an application for the approval or 
              reauthorization to accept and redeem coupons that contains 
              false information about a substantive matter that was a part of
              the application.'.
          SEC. 843. DISQUALIFICATION OF RETAILERS WHO ARE DISQUALIFIED UNDER
                            THE WIC PROGRAM.
            Section 12 of the Food Stamp Act of 1977 (7 U.S.C. 2021) is
          amended by adding at the end the following:
            `(g) DISQUALIFICATION OF RETAILERS WHO ARE DISQUALIFIED UNDER THE
          WIC PROGRAM-
                `(1) IN GENERAL- The Secretary shall issue regulations
              providing criteria for the disqualification under this Act of 
              an approved retail food store or a wholesale food concern that
              is disqualified from accepting benefits under the special
              supplemental nutrition program for women, infants, and children
              established under section 17 of the Child Nutrition Act of 1966
              (7 U.S.C. 1786).
                `(2) TERMS- A disqualification under paragraph (1)--
                    `(A) shall be for the same length of time as the
                  disqualification from the program referred to in paragraph
                  (1);
                    `(B) may begin at a later date than the disqualification
                  from the program referred to in paragraph (1); and
                    `(C) notwithstanding section 14, shall not be subject to
                  judicial or administrative review.'.
          SEC. 844. COLLECTION OF OVERISSUANCES.
            (a) COLLECTION OF OVERISSUANCES- Section 13 of the Food Stamp Act
          of 1977 (7 U.S.C. 2022) is amended--
                (1) by striking subsection (b) and inserting the following:
            `(b) COLLECTION OF OVERISSUANCES- 
                `(1) IN GENERAL- Except as otherwise provided in this
              subsection, a State agency shall collect any overissuance of
              coupons issued to a household by--
                    `(A) reducing the allotment of the household;
                    `(B) withholding amounts from unemployment compensation
                  from a member of the household under subsection (c);
                    `(C) recovering from Federal pay or a Federal income tax
                  refund under subsection (d); or
                    `(D) any other means.
                `(2) COST EFFECTIVENESS- Paragraph (1) shall not apply if the
              State agency demonstrates to the satisfaction of the Secretary
              that all of the means referred to in paragraph (1) are not cost
              effective.
                `(3) MAXIMUM REDUCTION ABSENT FRAUD- If a household received
              an overissuance of coupons without any member of the household
              being found ineligible to participate in the program under
              section 6(b)(1) and a State agency elects to reduce the
              allotment of the household under paragraph (1)(A), the State
              agency shall not reduce the monthly allotment of the household
              under paragraph (1)(A) by an amount in excess of the greater of--
                    `(A) 10 percent of the monthly allotment of the 
                  household; or
                    `(B) $10.
                `(4) PROCEDURES- A State agency shall collect an overissuance
              of coupons issued to a household under paragraph (1) in
              accordance with the requirements established by the State 
              agency for providing notice, electing a means of payment, and
              establishing a time schedule for payment.'; and
                (2) in subsection (d)--
                    (A) by striking `as determined under subsection (b) and
                  except for claims arising from an error of the State
                  agency,' and inserting `, as determined under subsection
                  (b)(1),'; and
                    (B) by inserting before the period at the end the
                  following: `or a Federal income tax refund as authorized by
                  section 3720A of title 31, United States Code'.
            (b) CONFORMING AMENDMENTS- Section 11(e)(8)(C) of the Food Stamp
          Act of 1977 (7 U.S.C. 2020(e)(8)(C)) is amended--
                (1) by striking `and excluding claims' and all that follows
              through `such section'; and
                (2) by inserting before the semicolon at the end the
              following: `or a Federal income tax refund as authorized by
              section 3720A of title 31, United States Code'.
            (c) RETENTION RATE- The proviso of the first sentence of section
          16(a) of the Food Stamp Act of 1977 (7 U.S.C. 2025(a)) is amended 
          by striking `25 percent during the period beginning October 1, 
          1990' and all that follows through `section 13(b)(2) which arise'
          and inserting `35 percent of the value of all funds or allotments
          recovered or collected pursuant to sections 6(b) and 13(c) and 20
          percent of the value of any other funds or allotments recovered or
          collected, except the value of funds or allotments recovered or
          collected that arise'.
          SEC. 845. AUTHORITY TO SUSPEND STORES VIOLATING PROGRAM 
                            REQUIREMENTS PENDING ADMINISTRATIVE AND JUDICIAL
                            REVIEW.
            Section 14(a) of the Food Stamp Act of 1977 (7 U.S.C. 2023(a)) is
          amended--
                (1) by redesignating the first through seventeenth sentences
              as paragraphs (1) through (17), respectively; and
                (2) by adding at the end the following:
                `(18) SUSPENSION OF STORES PENDING REVIEW- Notwithstanding 
              any other provision of this subsection, any permanent
              disqualification of a retail food store or wholesale food
              concern under paragraph (3) or (4) of section 12(b) shall be
              effective from the date of receipt of the notice of
              disqualification. If the disqualification is reversed through
              administrative or judicial review, the Secretary shall not be
              liable for the value of any sales lost during the
              disqualification period.'.
          SEC. 846. EXPANDED CRIMINAL FORFEITURE FOR VIOLATIONS.
            (a) FORFEITURE OF ITEMS EXCHANGED IN FOOD STAMP TRAFFICKING- The
          first sentence of section 15(g) of the Food Stamp Act of 1977 (7
          U.S.C. 2024(g)) is amended by striking `or intended to be furnished'.
            (b) CRIMINAL FORFEITURE- Section 15 of the Food Stamp Act of 1977
          (7 U.S.C. 2024) is amended by adding at the end the following:
            `(h) CRIMINAL FORFEITURE- 
                `(1) IN GENERAL- In imposing a sentence on a person convicted
              of an offense in violation of subsection (b) or (c), a court
              shall order, in addition to any other sentence imposed under
              this section, that the person forfeit to the United States all
              property described in paragraph (2).
                `(2) PROPERTY SUBJECT TO FORFEITURE- All property, real and
              personal, used in a transaction or attempted transaction, to
              commit, or to facilitate the commission of, a violation (other
              than a misdemeanor) of subsection (b) or (c), or proceeds
              traceable to a violation of subsection (b) or (c), shall be
              subject to forfeiture to the United States under paragraph (1).
                `(3) INTEREST OF OWNER- No interest in property shall be
              forfeited under this subsection as the result of any act or
              omission established by the owner of the interest to have been
              committed or omitted without the knowledge or consent of the
              owner.
                `(4) PROCEEDS- The proceeds from any sale of forfeited
              property and any monies forfeited under this subsection shall 
              be used--
                    `(A) first, to reimburse the Department of Justice for 
                  the costs incurred by the Department to initiate and
                  complete the forfeiture proceeding;
                    `(B) second, to reimburse the Department of Agriculture
                  Office of Inspector General for any costs the Office
                  incurred in the law enforcement effort resulting in the
                  forfeiture;
                    `(C) third, to reimburse any Federal or State law
                  enforcement agency for any costs incurred in the law
                  enforcement effort resulting in the forfeiture; and
                    `(D) fourth, by the Secretary to carry out the approval,
                  reauthorization, and compliance investigations of retail
                  stores and wholesale food concerns under section 9.'.
          SEC. 847. LIMITATION ON FEDERAL MATCH.
            Section 16(a)(4) of the Food Stamp Act of 1977 (7 U.S.C.
          2025(a)(4)) is amended by inserting after the comma at the end the
          following: `but not including recruitment activities,'.
          SEC. 848. STANDARDS FOR ADMINISTRATION.
            (a) IN GENERAL- Section 16 of the Food Stamp Act of 1977 (7 
          U.S.C. 2025) is amended by striking subsection (b).
            (b) CONFORMING AMENDMENTS- 
                (1) The first sentence of section 11(g) of the Food Stamp Act
              of 1977 (7 U.S.C. 2020(g)) is amended by striking `the
              Secretary's standards for the efficient and effective
              administration of the program established under section 
              16(b)(1) or'.
                (2) Section 16(c)(1)(B) of the Food Stamp Act of 1977 (7
              U.S.C. 2025(c)(1)(B)) is amended by striking `pursuant to
              subsection (b)'.
          SEC. 849. WORK SUPPLEMENTATION OR SUPPORT PROGRAM.
            Section 16 of the Food Stamp Act of 1977 (7 U.S.C. 2025), as
          amended by section 848(a), is amended by inserting after subsection
          (a) the following:
            `(b) WORK SUPPLEMENTATION OR SUPPORT PROGRAM- 
                `(1) DEFINITION OF WORK SUPPLEMENTATION OR SUPPORT PROGRAM- 
              In this subsection, the term `work supplementation or support
              program' means a program under which, as determined by the
              Secretary, public assistance (including any benefits provided
              under a program established by the State and the food stamp
              program) is provided to an employer to be used for hiring and
              employing a public assistance recipient who was not employed by
              the employer at the time the public assistance recipient 
              entered the program.
                `(2) PROGRAM- A State agency may elect to use an amount equal
              to the allotment that would otherwise be issued to a household
              under the food stamp program, but for the operation of this
              subsection, for the purpose of subsidizing or supporting a job
              under a work supplementation or support program established by
              the State.
                `(3) PROCEDURE- If a State agency makes an election under
              paragraph (2) and identifies each household that participates 
              in the food stamp program that contains an individual who is
              participating in the work supplementation or support program--
                    `(A) the Secretary shall pay to the State agency an 
                  amount equal to the value of the allotment that the
                  household would be eligible to receive but for the 
                  operation of this subsection;
                    `(B) the State agency shall expend the amount received
                  under subparagraph (A) in accordance with the work
                  supplementation or support program in lieu of providing the
                  allotment that the household would receive but for the
                  operation of this subsection;
                    `(C) for purposes of--
                        `(i) sections 5 and 8(a), the amount received under
                      this subsection shall be excluded from household income
                      and resources; and
                        `(ii) section 8(b), the amount received under this
                      subsection shall be considered to be the value of an
                      allotment provided to the household; and
                    `(D) the household shall not receive an allotment from 
                  the State agency for the period during which the member
                  continues to participate in the work supplementation or
                  support program.
                `(4) OTHER WORK REQUIREMENTS- No individual shall be excused,
              by reason of the fact that a State has a work supplementation 
              or support program, from any work requirement under section
              6(d), except during the periods in which the individual is
              employed under the work supplementation or support program.
                `(5) LENGTH OF PARTICIPATION- A State agency shall provide a
              description of how the public assistance recipients in the
              program shall, within a specific period of time, be moved from
              supplemented or supported employment to employment that is not
              supplemented or supported.
                `(6) DISPLACEMENT- A work supplementation or support program
              shall not displace the employment of individuals who are not
              supplemented or supported.'.
          SEC. 850. WAIVER AUTHORITY.
            Section 17(b)(1) of the Food Stamp Act of 1977 (7 U.S.C.
          2026(b)(1)) is amended--
                (1) by redesignating subparagraph (B) as subparagraph (C); and
                (2) in subparagraph (A)--
                    (A) in the first sentence, by striking `benefits to
                  eligible households, including' and inserting the 
                  following: `benefits to eligible households, and may waive
                  any requirement of this Act to the extent necessary for the
                  project to be conducted.
                    `(B) PROJECT REQUIREMENTS- 
                        `(i) PROGRAM GOAL- The Secretary may not conduct a
                      project under subparagraph (A) unless--
            `(I) the project is consistent with the goal of the food stamp
          program of providing food assistance to raise levels of nutrition
          among low-income individuals; and
            `(II) the project includes an evaluation to determine the effects
          of the project.
                        `(ii) PERMISSIBLE PROJECTS- The Secretary may conduct
                      a project under subparagraph (A) to--
            `(I) improve program administration;
            `(II) increase the self-sufficiency of food stamp recipients;
            `(III) test innovative welfare reform strate-gies; or
            `(IV) allow greater conformity with the rules of other programs
          than would be allowed but for this paragraph.
                        `(iii) RESTRICTIONS ON PERMISSIBLE PROJECTS- If the
                      Secretary finds that a project under subparagraph (A)
                      would reduce benefits by more than 20 percent for more
                      than 5 percent of households in the area subject to the
                      project (not including any household whose benefits are
                      reduced due to a failure to comply with work or other
                      conduct requirements), the project--
            `(I) may not include more than 15 percent of the State's food
          stamp households; and
            `(II) shall continue for not more than 5 years after the date of
          implementation, unless the Secretary approves an extension 
          requested by the State agency at any time.
                        `(iv) IMPERMISSIBLE PROJECTS- The Secretary may not
                      conduct a project under subparagraph (A) that--
            `(I) involves the payment of the value of an allotment in the 
          form of cash, unless the project was approved prior to the date of
          enactment of this subparagraph;
            `(II) has the effect of substantially transferring funds made
          available under this Act to services or benefits provided primarily
          through another public assistance program, or using the funds for
          any purpose other than the purchase of food, program 
          administration, or an employment or training program;
            `(III) is inconsistent with--
            `(aa) the last 2 sentences of section 3(i);
            `(bb) the last sentence of section 5(a), insofar as a waiver
          denies assistance to an otherwise eligible household or individual
          if the household or individual has not failed to comply with any
          work, behavioral, or other conduct requirement under this or 
          another program;
            `(cc) section 5(c)(2);
            `(dd) paragraph (2)(B), (4)(F)(i), or (4)(K) of section 6(d);
            `(ee) section 8(b);
            `(ff) section 11(e)(2)(B);
            `(gg) the time standard under section 11(e)(3);
            `(hh) subsection (a), (c), (g), (h)(2), or (h)(3) of section 16;
            `(ii) this paragraph; or
            `(jj) subsection (a)(1) or (g)(1) of sec-tion 20;
            `(IV) modifies the operation of section 5 so as to have the 
          effect of--
            `(aa) increasing the shelter deduction to households with no
          out-of-pocket housing costs or housing costs that consume a low
          percentage of the household's income; or
            `(bb) absolving a State from acting with reasonable promptness on
          substantial reported changes in income or household size (except
          that this subclause shall not apply with regard to changes related
          to food stamp deductions);
            `(V) is not limited to a specific time period; or
            `(VI) waives a provision of section 26.
                        `(v) ADDITIONAL INCLUDED PROJECTS- A pilot or
                      experimental project may include';
                    (B) by striking `to aid to families with dependent
                  children under part A of title IV of the Social Security
                  Act' and inserting `are receiving assistance under a State
                  program funded under part A of title IV of the Social
                  Security Act (42 U.S.C. 601 et seq.)'; and
                    (C) by striking `coupons. The Secretary' and all that
                  follows through `Any pilot' and inserting the following:
                  `coupons.
                        `(vi) CASH PAYMENT PILOT PROJECTS- Any pilot'.
          SEC. 851. RESPONSE TO WAIVERS.
            Section 17(b)(1) of the Food Stamp Act of 1977 (7 U.S.C.
          2026(b)(1)), as amended by section 850, is amended by adding at the
          end the following:
                    `(D) RESPONSE TO WAIVERS- 
                        `(i) RESPONSE- Not later than 60 days after the date
                      of receiving a request for a waiver under subparagraph
                      (A), the Secretary shall provide a response that--
            `(I) approves the waiver request;
            `(II) denies the waiver request and describes any modification
          needed for approval of the waiver request;
            `(III) denies the waiver request and describes the grounds for 
          the denial; or
            `(IV) requests clarification of the waiver request.
                        `(ii) FAILURE TO RESPOND- If the Secretary does not
                      provide a response in accordance with clause (i), the
                      waiver shall be considered approved, unless the 
                      approval is specifically prohibited by this Act.
                        `(iii) NOTICE OF DENIAL- On denial of a waiver 
                      request under clause (i)(III), the Secretary shall
                      provide a copy of the waiver request and a description
                      of the reasons for the denial to the Committee on
                      Agriculture of the House of Representatives and the
                      Committee on Agriculture, Nutrition, and Forestry of 
                      the Senate.'.
          SEC. 852. EMPLOYMENT INITIATIVES PROGRAM.
            Section 17 of the Food Stamp Act of 1977 (7 U.S.C. 2026) is
          amended by striking subsection (d) and inserting the following:
            `(d) EMPLOYMENT INITIATIVES PROGRAM- 
                `(1) ELECTION TO PARTICIPATE- 
                    `(A) IN GENERAL- Subject to the other provisions of this
                  subsection, a State may elect to carry out an employment
                  initiatives program under this subsection.
                    `(B) REQUIREMENT- A State shall be eligible to carry out
                  an employment initiatives program under this subsection 
                  only if not less than 50 percent of the households in the
                  State that received food stamp benefits during the summer 
                  of 1993 also received benefits under a State program funded
                  under part A of title IV of the Social Security Act (42
                  U.S.C. 601 et seq.) during the summer of 1993.
                `(2) PROCEDURE- 
                    `(A) IN GENERAL- A State that has elected to carry out an
                  employment initiatives program under paragraph (1) may use
                  amounts equal to the food stamp allotments that would
                  otherwise be issued to a household under the food stamp
                  program, but for the operation of this subsection, to
                  provide cash benefits in lieu of the food stamp allotments
                  to the household if the household is eligible under
                  paragraph (3).
                    `(B) PAYMENT- The Secretary shall pay to each State that
                  has elected to carry out an employment initiatives program
                  under paragraph (1) an amount equal to the value of the
                  allotment that each household participating in the program
                  in the State would be eligible to receive under this Act 
                  but for the operation of this subsection.
                    `(C) OTHER PROVISIONS- For purposes of the food stamp
                  program (other than this subsection)--
                        `(i) cash assistance under this subsection shall be
                      considered to be an allotment; and
                        `(ii) each household receiving cash benefits under
                      this subsection shall not receive any other food stamp
                      benefit during the period for which the cash assistance
                      is provided.
                    `(D) ADDITIONAL PAYMENTS- Each State that has elected to
                  carry out an employment initiatives program under paragraph
                  (1) shall--
                        `(i) increase the cash benefits provided to each
                      household participating in the program in the State
                      under this subsection to compensate for any State or
                      local sales tax that may be collected on purchases of
                      food by the household, unless the Secretary determines
                      on the basis of information provided by the State that
                      the increase is unnecessary on the basis of the limited
                      nature of the items subject to the State or local sales
                      tax; and
                        `(ii) pay the cost of any increase in cash benefits
                      required by clause (i).
                `(3) ELIGIBILITY- A household shall be eligible to receive
              cash benefits under paragraph (2) if an adult member of the
              household--
                    `(A) has worked in unsubsidized employment for not less
                  than the preceding 90 days;
                    `(B) has earned not less than $350 per month from the
                  employment referred to in subparagraph (A) for not less 
                  than the preceding 90 days;
                    `(C)(i) is receiving benefits under a State program 
                  funded under part A of title IV of the Social Security Act
                  (42 U.S.C. 601 et seq.); or
                    `(ii) was receiving benefits under a State program funded
                  under part A of title IV of the Social Security Act (42
                  U.S.C. 601 et seq.) at the time the member first received
                  cash benefits under this subsection and is no longer
                  eligible for the State program because of earned income;
                    `(D) is continuing to earn not less than $350 per month
                  from the employment referred to in subparagraph (A); and
                    `(E) elects to receive cash benefits in lieu of food 
                  stamp benefits under this subsection.
                `(4) EVALUATION- A State that operates a program under this
              subsection for 2 years shall provide to the Secretary a written
              evaluation of the impact of cash assistance under this
              subsection. The State agency, with the concurrence of the
              Secretary, shall determine the content of the evaluation.'.
          SEC. 853. REAUTHORIZATION.
            The first sentence of section 18(a)(1) of the Food Stamp Act of
          1977 (7 U.S.C. 2027(a)(1)) is amended by striking `1991 through
          1997' and inserting `1996 through 2002'.
          SEC. 854. SIMPLIFIED FOOD STAMP PROGRAM.
            (a) IN GENERAL- The Food Stamp Act of 1977 (7 U.S.C. 2011 et 
          seq.) is amended by adding at the end the following:
          `SEC. 26. SIMPLIFIED FOOD STAMP PROGRAM.
            `(a) DEFINITION OF FEDERAL COSTS- In this section, the term
          `Federal costs' does not include any Federal costs incurred under
          section 17.
            `(b) ELECTION- Subject to subsection (d), a State may elect to
          carry out a Simplified Food Stamp Program (referred to in this
          section as a `Program'), statewide or in a political subdivision of
          the State, in accordance with this section.
            `(c) OPERATION OF PROGRAM- If a State elects to carry out a
          Program, within the State or a political subdivision of the State--
                `(1) a household in which no members receive assistance under
              a State program funded under part A of title IV of the Social
              Security Act (42 U.S.C. 601 et seq.) may not participate in the
              Program;
                `(2) a household in which all members receive assistance 
              under a State program funded under part A of title IV of the
              Social Security Act (42 U.S.C. 601 et seq.) shall automatically
              be eligible to participate in the Program;
                `(3) if approved by the Secretary, a household in which 1 or
              more members but not all members receive assistance under a
              State program funded under part A of title IV of the Social
              Security Act (42 U.S.C. 601 et seq.) may be eligible to
              participate in the Program; and
                `(4) subject to subsection (f), benefits under the Program
              shall be determined under rules and procedures established by
              the State under--
                    `(A) a State program funded under part A of title IV of
                  the Social Security Act (42 U.S.C. 601 et seq.);
                    `(B) the food stamp program; or
                    `(C) a combination of a State program funded under part A
                  of title IV of the Social Security Act (42 U.S.C. 601 et
                  seq.) and the food stamp program.
            `(d) APPROVAL OF PROGRAM- 
                `(1) STATE PLAN- A State agency may not operate a Program
              unless the Secretary approves a State plan for the operation of
              the Program under paragraph (2).
                `(2) APPROVAL OF PLAN- The Secretary shall approve any State
              plan to carry out a Program if the Secretary determines that 
              the plan--
                    `(A) complies with this section; and
                    `(B) contains sufficient documentation that the plan will
                  not increase Federal costs for any fiscal year.
            `(e) INCREASED FEDERAL COSTS- 
                `(1) DETERMINATION- 
                    `(A) IN GENERAL- The Secretary shall determine whether a
                  Program being carried out by a State agency is increasing
                  Federal costs under this Act.
                    `(B) NO EXCLUDED HOUSEHOLDS- In making a determination
                  under subparagraph (A), the Secretary shall not require the
                  State agency to collect or report any information on
                  households not included in the Program.
                    `(C) ALTERNATIVE ACCOUNTING PERIODS- The Secretary may
                  approve the request of a State agency to apply alternative
                  accounting periods to determine if Federal costs do not
                  exceed the Federal costs had the State agency not elected 
                  to carry out the Program.
                `(2) NOTIFICATION- If the Secretary determines that the
              Program has increased Federal costs under this Act for any
              fiscal year or any portion of any fiscal year, the Secretary
              shall notify the State not later than 30 days after the
              Secretary makes the determination under paragraph (1).
                `(3) ENFORCEMENT- 
                    `(A) CORRECTIVE ACTION- Not later than 90 days after the
                  date of a notification under paragraph (2), the State shall
                  submit a plan for approval by the Secretary for prompt
                  corrective action that is designed to prevent the Program
                  from increasing Federal costs under this Act.
                    `(B) TERMINATION- If the State does not submit a plan
                  under subparagraph (A) or carry out a plan approved by the
                  Secretary, the Secretary shall terminate the approval of 
                  the State agency operating the Program and the State agency
                  shall be ineligible to operate a future Program.
            `(f) RULES AND PROCEDURES- 
                `(1) IN GENERAL- In operating a Program, a State or political
              subdivision of a State may follow the rules and procedures
              established by the State or political subdivision under a State
              program funded under part A of title IV of the Social Security
              Act (42 U.S.C. 601 et seq.) or under the food stamp program.
                `(2) STANDARDIZED DEDUCTIONS- In operating a Program, a State
              or political subdivision of a State may standardize the
              deductions provided under section 5(e). In developing the
              standardized deduction, the State shall consider the work
              expenses, dependent care costs, and shelter costs of
              participating households.
                `(3) REQUIREMENTS- In operating a Program, a State or
              political subdivision shall comply with the requirements of--
                    `(A) subsections (a) through (g) of section 7;
                    `(B) section 8(a) (except that the income of a household
                  may be determined under a State program funded under part A
                  of title IV of the Social Security Act (42 U.S.C. 601 et
                  seq.));
                    `(C) subsection (b) and (d) of section 8;
                    `(D) subsections (a), (c), (d), and (n) of section 11;
                    `(E) paragraphs (8), (12), (16), (18), (20), (24), and
                  (25) of section 11(e);
                    `(F) section 11(e)(10) (or a comparable requirement
                  established by the State under a State program funded under
                  part A of title IV of the Social Security Act (42 U.S.C. 
                  601 et seq.)); and
                    `(G) section 16.
                `(4) LIMITATION ON ELIGIBILITY- Notwithstanding any other
              provision of this section, a household may not receive benefits
              under this section as a result of the eligibility of the
              household under a State program funded under part A of title IV
              of the Social Security Act (42 U.S.C. 601 et seq.), unless the
              Secretary determines that any household with income above 130
              percent of the poverty guidelines is not eligible for the
              program.'.
            (b) STATE PLAN PROVISIONS- Section 11(e) of the Food Stamp Act of
          1977 (7 U.S.C. 2020(e)), as amended by sections 819(b) and 835, is
          amended by adding at the end the following:
                `(25) if a State elects to carry out a Simplified Food Stamp
              Program under section 26, the plans of the State agency for
              operating the program, including--
                    `(A) the rules and procedures to be followed by the State
                  agency to determine food stamp benefits;
                    `(B) how the State agency will address the needs of
                  households that experience high shelter costs in relation 
                  to the incomes of the households; and
                    `(C) a description of the method by which the State 
                  agency will carry out a quality control system under 
                  section 16(c).'.
            (c) CONFORMING AMENDMENTS- 
                (1) Section 8 of the Food Stamp Act of 1977 (7 U.S.C. 2017),
              as amended by section 830, is amended--
                    (A) by striking subsection (e); and
                    (B) by redesignating subsection (f) as subsection (e).
                (2) Section 17 of the Food Stamp Act of 1977 (7 U.S.C. 2026)
              is amended--
                    (A) by striking subsection (i); and
                    (B) by redesignating subsections (j) through (l) as
                  subsections (i) through (k), respectively.
          SEC. 855. STUDY OF THE USE OF FOOD STAMPS TO PURCHASE VITAMINS AND
                            MINERALS.
            (a) IN GENERAL- The Secretary of Agriculture, in consultation 
          with the National Academy of Sciences and the Center for Disease
          Control and Prevention, shall conduct a study on the use of food
          stamps provided under the Food Stamp Act of 1977 (7 U.S.C. 2011 et
          seq.) to purchase vitamins and minerals.
            (b) ANALYSIS- The study shall include--
                (1) an analysis of scientific findings on the efficacy of and
              need for vitamins and minerals, including--
                    (A) the adequacy of vitamin and mineral intakes in
                  low-income populations, as shown by research and surveys
                  conducted prior to the study; and
                    (B) the potential value of nutritional supplements in
                  filling nutrient gaps that may exist in the United States
                  population as a whole or in vulnerable subgroups in the
                  population;
                (2) the impact of nutritional improvements (including vitamin
              or mineral supplementation) on the health status and health 
              care costs of women of childbearing age, pregnant or lactating
              women, and the elderly;
                (3) the cost of commercially available vitamin and mineral
              supplements;
                (4) the purchasing habits of low-income populations with
              regard to vitamins and minerals;
                (5) the impact of using food stamps to purchase vitamins and
              minerals on the food purchases of low-income house-holds; and
                (6) the economic impact on the production of agricultural
              commodities of using food stamps to purchase vitamins and
              minerals.
            (c) REPORT- Not later than December 15, 1998, the Secretary shall
          report the results of the study to the Committee on Agriculture of
          the House of Representatives and the Committee on Agriculture,
          Nutrition, and Forestry of the Senate.
          SEC. 856. DEFICIT REDUCTION.
            It is the sense of the Committee on Agriculture of the House of
          Representatives that reductions in outlays resulting from this 
          title shall not be taken into account for purposes of section 252 
          of the Balanced Budget and Emergency Deficit Control Act of 1985 (2
          U.S.C. 902).
                       SUBTITLE B--COMMODITY DISTRIBUTION PROGRAMS
          SEC. 871. EMERGENCY FOOD ASSISTANCE PROGRAM.
            (a) DEFINITIONS- Section 201A of the Emergency Food Assistance 
          Act of 1983 (Public Law 98-8; 7 U.S.C. 612c note) is amended to 
          read as follows:
          `SEC. 201A. DEFINITIONS.
            `In this Act:
                `(1) ADDITIONAL COMMODITIES- The term `additional 
              commodities' means commodities made available under section 214
              in addition to the commodities made available under sections 
              202 and 203D.
                `(2) AVERAGE MONTHLY NUMBER OF UNEMPLOYED PERSONS- The term
              `average monthly number of unemployed persons' means the 
              average monthly number of unemployed persons in each State
              during the most recent fiscal year for which information
              concerning the number of unemployed persons is available, as
              determined by the Bureau of Labor Statistics of the Department
              of Labor.
                `(3) ELIGIBLE RECIPIENT AGENCY- The term `eligible recipient
              agency' means a public or nonprofit organiza-tion that--
                    `(A) administers--
                        `(i) an emergency feeding organization;
                        `(ii) a charitable institution (including a hospital
                      and a retirement home, but excluding a penal
                      institution) to the extent that the institution serves
                      needy persons;
                        `(iii) a summer camp for children, or a child
                      nutrition program providing food service;
                        `(iv) a nutrition project operating under the Older
                      Americans Act of 1965 (42 U.S.C. 3001 et seq.),
                      including a project that operates a congregate 
                      nutrition site and a project that provides
                      home-delivered meals; or
                        `(v) a disaster relief program;
                    `(B) has been designated by the appropriate State agency,
                  or by the Secretary; and
                    `(C) has been approved by the Secretary for participation
                  in the program established under this Act.
                `(4) EMERGENCY FEEDING ORGANIZATION- The term `emergency
              feeding organization' means a public or nonprofit organization
              that administers activities and projects (including the
              activities and projects of a charitable institution, a food
              bank, a food pantry, a hunger relief center, a soup kitchen, or
              a similar public or private nonprofit eligible recipient 
              agency) providing nutrition assistance to relieve situations of
              emergency and distress through the provision of food to needy
              persons, including low-income and unemployed persons.
                `(5) FOOD BANK- The term `food bank' means a public or
              charitable institution that maintains an established operation
              involving the provision of food or edible commodities, or the
              products of food or edible commodities, to food pantries, soup
              kitchens, hunger relief centers, or other food or feeding
              centers that, as an integral part of their normal activities,
              provide meals or food to feed needy persons on a regular basis.
                `(6) FOOD PANTRY- The term `food pantry' means a public or
              private nonprofit organization that distributes food to
              low-income and unemployed households, including food from
              sources other than the Department of Agriculture, to relieve
              situations of emergency and distress.
                `(7) POVERTY LINE- The term `poverty line' has the meaning
              provided in section 673(2) of the Community Services Block 
              Grant Act (42 U.S.C. 9902(2)).
                `(8) SOUP KITCHEN- The term `soup kitchen' means a public or
              charitable institution that, as an integral part of the normal
              activities of the institution, maintains an established feeding
              operation to provide food to needy homeless persons on a 
              regular basis.
                `(9) TOTAL VALUE OF ADDITIONAL COMMODITIES- The term `total
              value of additional commodities' means the actual cost of all
              additional commodities that are paid by the Secretary 
              (including the distribution and processing costs incurred by 
              the Secretary).
                `(10) VALUE OF ADDITIONAL COMMODITIES ALLOCATED TO EACH 
              STATE- The term `value of additional commodities allocated to
              each State' means the actual cost of additional commodities
              allocated to each State that are paid by the Secretary
              (including the distribution and processing costs incurred by 
              the Secretary).'.
            (b) STATE PLAN- Section 202A of the Emergency Food Assistance Act
          of 1983 (Public Law 98-8; 7 U.S.C. 612c note) is amended to read as
          follows:
          `SEC. 202A. STATE PLAN.
            `(a) IN GENERAL- To receive commodities under this Act, a State
          shall submit a plan of operation and administration every 4 years 
          to the Secretary for approval. The plan may be amended at any time,
          with the approval of the Secretary.
            `(b) REQUIREMENTS- Each plan shall--
                `(1) designate the State agency responsible for distributing
              the commodities received under this Act;
                `(2) set forth a plan of operation and administration to
              expeditiously distribute commodities under this Act;
                `(3) set forth the standards of eligibility for recipient
              agencies; and
                `(4) set forth the standards of eligibility for individual or
              household recipients of commodities, which shall require--
                    `(A) individuals or households to be comprised of needy
                  persons; and
                    `(B) individual or household members to be residing in 
                  the geographic location served by the distributing agency 
                  at the time of applying for assistance.
            `(c) STATE ADVISORY BOARD- The Secretary shall encourage each
          State receiving commodities under this Act to establish a State
          advisory board consisting of representatives of all entities in the
          State, both public and private, interested in the distribution of
          commodities received under this Act.'.
            (c) AUTHORIZATION OF APPROPRIATIONS FOR ADMINISTRATIVE FUNDS-
          Section 204(a)(1) of the Emergency Food Assistance Act of 1983
          (Public Law 98-8; 7 U.S.C. 612c note) is amended--
                (1) in the first sentence, by striking `for State and local'
              and all that follows through `under this title' and inserting
              `to pay for the direct and indirect administrative costs of the
              States related to the processing, transporting, and 
              distributing to eligible recipient agencies of commodities
              provided by the Secretary under this Act and commodities 
              secured from other sources'; and
                (2) by striking the fourth sentence.
            (d) DELIVERY OF COMMODITIES- Section 214 of the Emergency Food
          Assistance Act of 1983 (Public Law 98-8; 7 U.S.C. 612c note) is
          amended--
                (1) by striking subsections (a) through (e) and (j);
                (2) by redesignating subsections (f) through (i) as
              subsections (a) through (d), respectively;
                (3) in subsection (b), as redesignated by paragraph (2)--
                    (A) in the first sentence, by striking `subsection (f) or
                  subsection (j) if applicable,' and inserting `subsection
                  (a),'; and
                    (B) in the second sentence, by striking `subsection (f)'
                  and inserting `subsection (a)';
                (4) by striking subsection (c), as redesignated by paragraph
              (2), and inserting the following:
            `(c) ADMINISTRATION- 
                `(1) IN GENERAL- Commodities made available for each fiscal
              year under this section shall be delivered at reasonable
              intervals to States based on the grants calculated under
              subsection (a), or reallocated under subsection (b), before
              December 31 of the following fiscal year.
                `(2) ENTITLEMENT- Each State shall be entitled to receive the
              value of additional commodities determined under subsection
              (a).'; and
                (5) in subsection (d), as redesignated by paragraph (2), by
              striking `or reduce' and all that follows through `each fiscal
              year'.
            (e) TECHNICAL AMENDMENTS- The Emergency Food Assistance Act of
          1983 (Public Law 98-8; 7 U.S.C. 612c note) is amended--
                (1) in the first sentence of section 203B(a), by striking 
              `203 and 203A of this Act' and inserting `203A';
                (2) in section 204(a), by striking `title' each place it
              appears and inserting `Act';
                (3) in the first sentence of section 210(e), by striking
              `(except as otherwise provided for in section 214(j))'; and
                (4) by striking section 212.
            (f) REPORT ON EFAP- Section 1571 of the Food Security Act of 1985
          (Public Law 99-198; 7 U.S.C. 612c note) is repealed.
            (g) AVAILABILITY OF COMMODITIES UNDER THE FOOD STAMP PROGRAM- The
          Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.), as amended by
          section 854(a), is amended by adding at the end the following:
          `SEC. 27. AVAILABILITY OF COMMODITIES FOR THE EMERGENCY FOOD
                            ASSISTANCE PROGRAM.
            `(a) PURCHASE OF COMMODITIES- From amounts made available to 
          carry out this Act, for each of fiscal years 1997 through 2002, the
          Secretary shall purchase $100,000,000 of a variety of nutritious 
          and useful commodities of the types that the Secretary has the
          authority to acquire through the Commodity Credit Corporation or
          under section 32 of the Act entitled `An Act to amend the
          Agricultural Adjustment Act, and for other purposes', approved
          August 24, 1935 (7 U.S.C. 612c), and distribute the commodities to
          States for distribution in accordance with section 214 of the
          Emergency Food Assistance Act of 1983 (Public Law 98-8; 7 U.S.C.
          612c note).
            `(b) BASIS FOR COMMODITY PURCHASES- In purchasing commodities
          under subsection (a), the Secretary shall, to the extent 
          practicable and appropriate, make purchases based on--
                `(1) agricultural market conditions;
                `(2) preferences and needs of States and distributing
              agencies; and
                `(3) preferences of recipients.'.
            (h) EFFECTIVE DATE- The amendments made by subsection (d) shall
          become effective on October 1, 1996.
          SEC. 872. FOOD BANK DEMONSTRATION PROJECT.
            Section 3 of the Charitable Assistance and Food Bank Act of 1987
          (Public Law 100-232; 7 U.S.C. 612c note) is repealed.
          SEC. 873. HUNGER PREVENTION PROGRAMS.
            The Hunger Prevention Act of 1988 (Public Law 100-435; 7 U.S.C.
          612c note) is amended--
                (1) by striking section 110;
                (2) by striking subtitle C of title II; and
                (3) by striking section 502.
          SEC. 874. REPORT ON ENTITLEMENT COMMODITY PROCESSING.
            Section 1773 of the Food, Agriculture, Conservation, and Trade 
          Act of 1990 (Public Law 101-624; 7 U.S.C. 612c note) is amended by
          striking subsection (f).
                     SUBTITLE C--ELECTRONIC BENEFIT TRANSFER SYSTEMS
          SEC. 891. PROVISIONS TO ENCOURAGE ELECTRONIC BENEFIT TRANSFER
                            SYSTEMS.
            Section 904 of the Electronic Fund Transfer Act (15 U.S.C. 1693b)
          is amended--
                (1) by striking `(d) In the event that' and inserting `(d)
              APPLICABILITY TO SERVICE PROVIDERS OTHER THAN CERTAIN FINANCIAL
              INSTITUTIONS-
                `(1) IN GENERAL- If'; and
                (2) by adding at the end the following:
                `(2) STATE AND LOCAL GOVERNMENT ELECTRONIC BENEFIT TRANSFER
              SYSTEMS-
                    `(A) DEFINITION OF ELECTRONIC BENEFIT TRANSFER SYSTEM- In
                  this paragraph, the term `electronic benefit transfer
                  system'--
                        `(i) means a system under which a government agency
                      distributes needs-tested benefits by establishing
                      accounts that may be accessed by recipients
                      electronically, such as through automated teller
                      machines or point-of-sale terminals; and
                        `(ii) does not include employment-related payments,
                      including salaries and pension, retirement, or
                      unemployment benefits established by a Federal, State,
                      or local government agency.
                    `(B) EXEMPTION GENERALLY- The disclosures, protections,
                  responsibilities, and remedies established under this 
                  title, and any regulation prescribed or order issued by the
                  Board in accordance with this title, shall not apply to any
                  electronic benefit transfer system established under State
                  or local law or administered by a State or local government.
                    `(C) EXCEPTION FOR DIRECT DEPOSIT INTO RECIPIENT'S
                  ACCOUNT- Subparagraph (B) shall not apply with respect to
                  any electronic funds transfer under an electronic benefit
                  transfer system for a deposit directly into a consumer
                  account held by the recipient of the benefit.
                    `(D) RULE OF CONSTRUCTION- No provision of this paragraph--
                        `(i) affects or alters the protections otherwise
                      applicable with respect to benefits established by any
                      other provision Federal, State, or local law; or
                        `(ii) otherwise supersedes the application of any
                      State or local law.'.
                                 TITLE IX--MISCELLANEOUS
          SEC. 901. APPROPRIATION BY STATE LEGISLATURES.
            (a) IN GENERAL- Any funds received by a State under the 
          provisions of law specified in subsection (b) shall be subject to
          appropriation by the State legislature, consistent with the terms
          and conditions required under such provisions of law.
            (b) PROVISIONS OF LAW- The provisions of law specified in this
          subsection are the following:
                (1) Part A of title IV of the Social Security Act (relating 
              to block grants for temporary assistance for needy families).
                (2) The Child Care and Development Block Grant Act of 1990
              (relating to block grants for child care).
          SEC. 902. SANCTIONING FOR TESTING POSITIVE FOR CONTROLLED SUBSTANCES.
            Notwithstanding any other provision of law, States shall not be
          prohibited by the Federal Government from testing welfare 
          recipients for use of controlled substances nor from sanctioning
          welfare recipients who test positive for use of controlled
          substances.
          SEC. 903. ELIMINATION OF HOUSING ASSISTANCE WITH RESPECT TO 
                            FUGITIVE FELONS AND PROBATION AND PAROLE VIOLATORS.
            (a) ELIGIBILITY FOR ASSISTANCE- The United States Housing Act of
          1937 (42 U.S.C. 1437 et seq.) is amended--
                (1) in section 6(l)--
                    (A) in paragraph (5), by striking `and' at the end;
                    (B) in paragraph (6), by striking the period at the end
                  and inserting `; and'; and
                    (C) by inserting immediately after paragraph (6) the
                  following new paragraph:
                `(7) provide that it shall be cause for immediate termination
              of the tenancy of a public housing tenant if such tenant--
                    `(A) is fleeing to avoid prosecution, or custody or
                  confinement after conviction, under the laws of the place
                  from which the individual flees, for a crime, or attempt to
                  commit a crime, which is a felony under the laws of the
                  place from which the individual flees, or which, in the 
                  case of the State of New Jersey, is a high misdemeanor 
                  under the laws of such State; or
                `(2) is violating a condition of probation or parole imposed
              under Federal or State law.'; and
                (2) in section 8(d)(1)(B)--
                    (A) in clause (iii), by striking `and' at the end;
                    (B) in clause (iv), by striking the period at the end and
                  inserting `; and'; and
                    (C) by adding after clause (iv) the following new clause:
                        `(v) it shall be cause for termination of the tenancy
                      of a tenant if such tenant--
            `(I) is fleeing to avoid prosecution, or custody or confinement
          after conviction, under the laws of the place from which the
          individual flees, for a crime, or attempt to commit a crime, which
          is a felony under the laws of the place from which the individual
          flees, or which, in the case of the State of New Jersey, is a high
          misdemeanor under the laws of such State; or
            `(II) is violating a condition of probation or parole imposed
          under Federal or State law;'.
            (b) PROVISION OF INFORMATION TO LAW ENFORCEMENT AGENCIES- Title I
          of the United States Housing Act of 1937 (42 U.S.C. 1437 et seq.) 
          is amended by adding at the end the following:
          `SEC. 27. EXCHANGE OF INFORMATION WITH LAW ENFORCEMENT AGENCIES.
            `Notwithstanding any other provision of law, each public housing
          agency that enters into a contract for assistance under section 6 
          or 8 of this Act with the Secretary shall furnish any Federal,
          State, or local law enforcement officer, upon the request of the
          officer, with the current address, Social Security number, and
          photograph (if applicable) of any recipient of assistance under 
          this Act, if the officer--
                `(1) furnishes the public housing agency with the name of the
              recipient; and
                `(2) notifies the agency that--
                    `(A) such recipient--
                        `(i) is fleeing to avoid prosecution, or custody or
                      confinement after conviction, under the laws of the
                      place from which the individual flees, for a crime, or
                      attempt to commit a crime, which is a felony under the
                      laws of the place from which the individual flees, or
                      which, in the case of the State of New Jersey, is a 
                      high misdemeanor under the laws of such State; or
                        `(ii) is violating a condition of probation or parole
                      imposed under Federal or State law; or
                        `(iii) has information that is necessary for the
                      officer to conduct the officer's official duties;
                    `(B) the location or apprehension of the recipient is
                  within such officer's official duties; and
                    `(C) the request is made in the proper exercise of the
                  officer's official duties.'.
          SEC. 904. SENSE OF THE SENATE REGARDING THE INABILITY OF THE
                            NONCUSTODIAL PARENT TO PAY CHILD SUPPORT.
            It is the sense of the Senate that--
                (a) States should diligently continue their efforts to 
              enforce child support payments by the non-custodial parent to
              the custodial parent, regardless of the employment status or
              location of the non-custodial parent; and
                (b) States are encouraged to pursue pilot programs in which
              the parents of a non-adult, non-custodial parent who refuses to
              or is unable to pay child support must--
                    (1) pay or contribute to the child support owed by the
                  non-custodial parent; or
                    (2) otherwise fulfill all financial obligations and meet
                  all conditions imposed on the non-custodial parent, such as
                  participation in a work program or other related activity.
          SEC. 905. ESTABLISHING NATIONAL GOALS TO PREVENT TEENAGE PREGNANCIES.
            (a) IN GENERAL- Not later than January 1, 1997, the Secretary of
          Health and Human Services shall establish and implement a strategy
          for--
                (1) preventing out-of-wedlock teenage pregnancies, and
                (2) assuring that at least 25 percent of the communities in
              the United States have teenage pregnancy prevention programs in
              place.
            (b) REPORT- Not later than June 30, 1998, and annually 
          thereafter, the Secretary shall report to the Congress with respect
          to the progress that has been made in meeting the goals described 
          in paragraphs (1) and (2) of subsection (a).
          SEC. 906. SENSE OF THE SENATE REGARDING ENFORCEMENT OF STATUTORY
                            RAPE LAWS.
            (a) SENSE OF THE SENATE- It is the sense of the Senate that 
          States and local jurisdictions should aggressively enforce 
          statutory rape laws.
            (b) JUSTICE DEPARTMENT PROGRAM ON STATUTORY RAPE- Not later than
          January 1, 1997, the Attorney General shall establish and implement
          a program that--
                (1) studies the linkage between statutory rape and teenage
              pregnancy, particularly by predatory older men committing 
              repeat offenses; and
                (2) educates State and local criminal law enforcement
              officials on the prevention and prosecution of statutory rape,
              focusing in particular on the commission of statutory rape by
              predatory older men committing repeat offenses, and any links 
              to teenage pregnancy.
            (c) VIOLENCE AGAINST WOMEN INITIATIVE- The Attorney General shall
          ensure that the Department of Justice's Violence Against Women
          initiative addresses the issue of statutory rape, particularly the
          commission of statutory rape by predatory older men committing
          repeat offenses.
          SEC. 907. PROVISIONS TO ENCOURAGE ELECTRONIC BENEFIT TRANSFER
                            SYSTEMS.
            Section 904 of the Electronic Fund Transfer Act (15 U.S.C. 1693b)
          is amended--
                (1) by striking `(d) In the event' and inserting `(d)
              APPLICABILITY TO SERVICE PROVIDERS OTHER THAN CERTAIN FINANCIAL
              INSTITUTIONS-
                `(1) IN GENERAL- In the event'; and
                (2) by adding at the end the following new paragraph:
                `(2) STATE AND LOCAL GOVERNMENT ELECTRONIC BENEFIT TRANSFER
              PROGRAMS-
                    `(A) EXEMPTION GENERALLY- The disclosures, protections,
                  responsibilities, and remedies established under this 
                  title, and any regulation prescribed or order issued by the
                  Board in accordance with this title, shall not apply to any
                  electronic benefit transfer program established under State
                  or local law or administered by a State or local government.
                    `(B) EXCEPTION FOR DIRECT DEPOSIT INTO RECIPIENT'S
                  ACCOUNT- Subparagraph (A) shall not apply with respect to
                  any electronic funds transfer under an electronic benefit
                  transfer program for deposits directly into a consumer
                  account held by the recipient of the benefit.
                    `(C) RULE OF CONSTRUCTION- No provision of this paragraph
                  may be construed as--
                        `(i) affecting or altering the protections otherwise
                      applicable with respect to benefits established by
                      Federal, State, or local law; or
                        `(ii) otherwise superseding the application of any
                      State or local law.
                    `(D) ELECTRONIC BENEFIT TRANSFER PROGRAM DEFINED- For
                  purposes of this paragraph, the term `electronic benefit
                  transfer program'--
                        `(i) means a program under which a government agency
                      distributes needs-tested benefits by establishing
                      accounts to be accessed by recipients electronically,
                      such as through automated teller machines, or
                      point-of-sale terminals; and
                        `(ii) does not include employment-related payments,
                      including salaries and pension, retirement, or
                      unemployment benefits established by Federal, State, or
                      local governments.'.
          SEC. 908. REDUCTION OF BLOCK GRANTS TO STATES FOR SOCIAL SERVICES;
                            USE OF VOUCHERS.
            (a) REDUCTION OF GRANTS- Section 2003(c) of the Social Security
          Act (42 U.S.C. 1397b(c)) is amended--
                (1) by striking `and' at the end of paragraph (4); and
                (2) by striking paragraph (5) and inserting the following:
                `(5) $2,800,000,000 for each of the fiscal years 1990 through
              1995;
                `(6) $2,381,000,000 for the fiscal year 1996;
                `(7) $2,380,000,000 for each of the fiscal years 1997 through
              2002; and
                `(8) $2,800,000,000 for the fiscal year 2003 and each
              succeeding fiscal year.'.
            (b) AUTHORITY TO USE VOUCHERS- Section 2002 of such Act (42 
          U.S.C. 1937a) is amended by adding at the end the following:
            `(f) A State may use funds provided under this title to provide
          vouchers, for services directed at the goals set forth in section
          2001, to families, including--
                `(1) families who have become ineligible for assistance under
              a State program funded under part A of title IV by reason of a
              durational limit on the provision of such assistance; and
                `(2) families denied cash assistance under the State program
              funded under part A of title IV for a child who is born to a
              member of the family who is--
                    `(A) a recipient of assistance under the program; or
                    `(B) a person who received such assistance at any time
                  during the 10-month period ending with the birth of the
                  child.'.
          SEC. 909. RULES RELATING TO DENIAL OF EARNED INCOME CREDIT ON BASIS
                            OF DISQUALIFIED INCOME.
            (a) REDUCTION IN DISQUALIFIED INCOME THRESHOLD- 
                (1) IN GENERAL- Paragraph (1) of section 32(i) of the 
              Internal Revenue Code of 1986 (relating to denial of credit for
              individuals having excessive investment income) is amended by
              striking `$2,350' and inserting `$2,200'.
                (2) ADJUSTMENT FOR INFLATION- Subsection (j) of section 32 of
              such Code is amended to read as follows:
            `(j) INFLATION ADJUSTMENTS- 
                `(1) IN GENERAL- In the case of any taxable year beginning
              after 1996, each of the dollar amounts in subsections (b)(2) 
              and (i)(1) shall be increased by an amount equal to--
                    `(A) such dollar amount, multiplied by
                    `(B) the cost-of-living adjustment determined under
                  section 1(f)(3) for the calendar year in which the taxable
                  year begins, determined by substituting `calendar year 
                  1995' for `calendar year 1992' in subparagraph (B) thereof.
                `(2) ROUNDING- 
                    `(A) IN GENERAL- If any dollar amount in subsection
                  (b)(2), after being increased under paragraph (1), is not a
                  multiple of $10, such dollar amount shall be rounded to the
                  nearest multiple of $10.
                    `(B) DISQUALIFIED INCOME THRESHOLD AMOUNT- If the dollar
                  amount in subsection (i)(1), after being increased under
                  paragraph (1), is not a multiple of $50, such amount shall
                  be rounded to the next lowest multiple of $50.'.
                (3) CONFORMING AMENDMENT- Paragraph (2) of section 32(b) of
              such Code is amended to read as follows:
                `(2) AMOUNTS- The earned income amount and the phaseout 
              amount shall be determined as follows:
          -------------------------------------------------------------------
          [ Headers for tabular data... ]
          1)  In the case of an eligible individual with:
          2)  The earned income amount is:
          3)  The phaseout amount is:
          -------------------------------------------------------------------
          1) 1 qualifying child
            2) $6,330
              3) $11,610
          1) 2 or more qualifying children
            2) $8,890
              3) $11,610
          1) No qualifying children
            2) $4,220
              3)  $ 5,280'.
          -------------------------------------------------------------------
            (b) DEFINITION OF DISQUALIFIED INCOME- Paragraph (2) of section
          32(i) of such Code (defining disqualified income) is amended by
          striking `and' at the end of subparagraph (B), by striking the
          period at the end of subparagraph (C) and inserting a comma, and by
          adding at the end the following new subparagraphs:
                    `(D) the capital gain net income (as defined in section
                  1222) of the taxpayer for such taxable year, and
                    `(E) the excess (if any) of--
                        `(i) the aggregate income from all passive activities
                      for the taxable year (determined without regard to any
                      amount included in earned income under subsection 
                      (c)(2) or described in a preceding subparagraph), over
                        `(ii) the aggregate losses from all passive 
                      activities for the taxable year (as so determined).
              For purposes of subparagraph (E), the term `passive activity'
              has the meaning given such term by section 469.'.
            (c) EFFECTIVE DATES- 
                (1) IN GENERAL- Except as provided in paragraph (2), the
              amendments made by this section shall apply to taxable years
              beginning after December 31, 1995.
                (2) ADVANCE PAYMENT INDIVIDUALS- In the case of any 
              individual who on or before June 26, 1996, has in effect an
              earned income eligibility certificate for the individual's
              taxable year beginning in 1996, the amendments made by this
              section shall apply to taxable years beginning after December
              31, 1996.
          SEC. 910. MODIFICATION OF ADJUSTED GROSS INCOME DEFINITION FOR
                            EARNED INCOME CREDIT.
            (a) IN GENERAL- Subsections (a)(2)(B), (c)(1)(C), and (f)(2)(B) 
          of section 32 of the Internal Revenue Code of 1986 are each amended
          by striking `adjusted gross income' each place it appears and
          inserting `modified adjusted gross income'.
            (b) MODIFIED ADJUSTED GROSS INCOME DEFINED- Section 32(c) of such
          Code (relating to definitions and special rules) is amended by
          adding at the end the following new paragraph:
                `(5) MODIFIED ADJUSTED GROSS INCOME- 
                    `(A) IN GENERAL- The term `modified adjusted gross 
                  income' means adjusted gross income determined without
                  regard to the amounts described in subparagraph (B).
                    `(B) CERTAIN AMOUNTS DISREGARDED- An amount is described
                  in this subparagraph if it is--
                        `(i) the amount of losses from sales or exchanges of
                      capital assets in excess of gains from such sales or
                      exchanges to the extent such amount does not exceed the
                      amount under section 1211(b)(1),
                        `(ii) the net loss from estates and trusts,
                        `(iii) the excess (if any) of amounts described in
                      subsection (i)(2)(C)(ii) over the amounts described in
                      subsection (i)(2)(C)(i) (relating to nonbusiness rents
                      and royalties), and
                        `(iv) 50 percent of the net loss from the carrying on
                      of trades or businesses, computed separately with
                      respect to--
            `(I) trades or businesses (other than farming) conducted as sole
          proprietorships,
            `(II) trades or businesses of farming conducted as sole
          proprietorships, and
            `(III) other trades or businesses.
                  For purposes of clause (iv), there shall not be taken into
                  account items which are attributable to a trade or business
                  which consists of the performance of services by the
                  taxpayer as an employee.'.
            (c) EFFECTIVE DATES- 
                (1) IN GENERAL- Except as provided in paragraph (2), the
              amendments made by this section shall apply to taxable years
              beginning after December 31, 1995.
                (2) ADVANCE PAYMENT INDIVIDUALS- In the case of any 
              individual who on or before June 26, 1996, has in effect an
              earned income eligibility certificate for the individual's
              taxable year beginning in 1996, the amendments made by this
              section shall apply to taxable years beginning after December
              31, 1996.
          SEC. 911. FRAUD UNDER MEANS-TESTED WELFARE AND PUBLIC ASSISTANCE
                            PROGRAMS.
            (a) IN GENERAL- If an individual's benefits under a Federal,
          State, or local law relating to a means-tested welfare or a public
          assistance program are reduced because of an act of fraud by the
          individual under the law or program, the individual may not, for 
          the duration of the reduction, receive an increased benefit under
          any other means-tested welfare or public assistance program for
          which Federal funds are appropriated as a result of a decrease in
          the income of the individual (determined under the applicable
          program) attributable to such reduction.
            (b) WELFARE OR PUBLIC ASSISTANCE PROGRAMS FOR WHICH FEDERAL FUNDS
          ARE APPROPRIATED- For purposes of subsection (a), the term
          `means-tested welfare or public assistance program for which 
          Federal funds are appropriated' includes the food stamp program
          under the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.), any
          program of public or assisted housing under title I of the United
          States Housing Act of 1937 (42 U.S.C. 1437 et seq.), and any State
          program funded under part A of title IV of the Social Security Act
          (42 U.S.C. 601 et seq.).
          SEC. 912. ABSTINENCE EDUCATION.
            Title V of the Social Security Act (42 U.S.C. 701 et seq.) is
          amended by adding at the end the following section:
                       `SEPARATE PROGRAM FOR ABSTINENCE EDUCATION
            `SEC. 510. (a) For the purpose described in subsection (b), the
          Secretary shall, for fiscal year 1998 and each subsequent fiscal
          year, allot to each State which has transmitted an application for
          the fiscal year under section 505(a) an amount equal to the product
          of--
                `(1) the amount appropriated in subsection (d) for the fiscal
              year; and
                `(2) the percentage determined for the State under section
              502(c)(1)(B)(ii).
            `(b)(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, 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.
            `(2) For purposes of this section, the term `abstinence 
          education' means an educational or motivational program which--
                    `(A) has as its exclusive purpose, teaching the social,
                  psychological, and health gains to be realized by 
                  abstaining from sexual activity;
                    `(B) teaches abstinence from sexual activity outside
                  marriage as the expected standard for all school age
                  children;
                    `(C) teaches that abstinence from sexual activity is the
                  only certain way to avoid out-of-wedlock pregnancy, 
                  sexually transmitted diseases, and other associated health
                  problems;
                    `(D) teaches that a mutually faithful monogamous
                  relationship in context of marriage is the expected 
                  standard of human sexual activity;
                    `(E) teaches that sexual activity outside of the context
                  of marriage is likely to have harmful psychological and
                  physical effects;
                    `(F) teaches that bearing children out-of-wedlock is
                  likely to have harmful consequences for the child, the
                  child's parents, and society;
                    `(G) teaches young people how to reject sexual advances
                  and how alcohol and drug use increases vulnerability to
                  sexual advances; and
                    `(H) teaches the importance of attaining self-sufficiency
                  before engaging in sexual activity.
            `(c)(1) Sections 503, 507, and 508 apply to allotments under
          subsection (a) to the same extent and in the same manner as such
          sections apply to allotments under section 502(c).
            `(2) Sections 505 and 506 apply to allotments under subsection 
          (a) to the extent determined by the Secretary to be appropriate.
            `(d) For the purpose of allotments under subsection (a), there is
          appropriated, out of any money in the Treasury not otherwise
          appropriated, an additional $50,000,000 for each of the fiscal 
          years 1998 through 2002. The appropriation under the preceding
          sentence for a fiscal year is made on October 1 of the fiscal year.'.
          SEC. 913. CHANGE IN REFERENCE.
            Effective January 1, 1997, the third sentence of section 1902(a)
          and section 1908(e)(1) of the Social Security Act (42 U.S.C.
          1396a(a), 1396g-1(e)(1)) are each amended by striking `The First
          Church of Christ, Scientist, Boston, Massachusetts' and inserting
          `The Commission for Accreditation of Christian Science Nursing
          Organizations/Facilities, Inc.' each place it appears.
          Speaker of the House of Representatives.
          Vice President of the United States and  
          President of the Senate.