
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 23, 2000]
[Document affected by Public Law 106-246 Section 2402]
[Document affected by Public Law 106-554 Section 1(a)(1)]
[Document affected by Public Law 106-554 Section 1(a)(1)[103]]
[Document affected by Public Law 106-554 Section 1(a)(1)[107(c)]]
[Document affected by Public Law 106-554 Section 1(a)(1)[513]]
[Document affected by Public Law 106-554 Section 1(a)(1)[107(d)]]
[CITE: 42USC603]

 
                 TITLE 42--THE PUBLIC HEALTH AND WELFARE
 
                       CHAPTER 7--SOCIAL SECURITY
 
 SUBCHAPTER IV--GRANTS TO STATES FOR AID AND SERVICES TO NEEDY FAMILIES 
              WITH CHILDREN AND FOR CHILD-WELFARE SERVICES
 
   Part A--Block Grants to States for Temporary Assistance for Needy 
                                Families
 
Sec. 603. 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 603 of this title (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 
            602 of this title (as so in effect));
                (ii)(I) the total amount required to be paid to the 
            State under former section 603 of this title 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 602 of this title (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 603(a)(5) of this title for 
            emergency assistance for fiscal year 1995 exceeds the total 
            amount required to be paid to the State under former section 
            603(a)(5) of this title for fiscal year 1994, if, during 
            fiscal year 1994 or 1995, the Secretary approved under 
            former section 602 of this title 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 603 of this title (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 of this subchapter (as so in effect) or for child 
            care under subsection (g) or (i) of former section 602 of 
            this title (as so in effect)), plus the total amount 
            required to be paid to the State for fiscal year 1995 under 
            former section 603(l) of this title (as so in effect).

        (C) ``Total amount required to be paid to the State under former 
                section 603'' defined

            As used in this part, the term ``total amount required to be 
        paid to the State under former section 603 of this title'' 
        means, with respect to a fiscal year--
                (i) in the case of a State to which section 1308 of this 
            title 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 603(b)(2) 
                of this title (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 602 of this 
                title (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 603 of this title for the fiscal year with 
                respect to the State program operated under part F of 
                this subchapter (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 1308 of 
            this title applies, the lesser of--
                    (I) the sum described in clause (i); or
                    (II) the total amount certified by the Secretary 
                under former section 603 of this title (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 ratio

        (A) In general

            Each eligible State shall be entitled to receive from the 
        Secretary a grant for each bonus year.

        (B) Amount of grant

            (i) In general

                If, for a bonus year, none of the eligible States is 
            Guam, the Virgin Islands, or American Samoa, then the amount 
            of the grant shall be--
                    (I) $20,000,000 if there are 5 eligible States; or
                    (II) $25,000,000 if there are fewer than 5 eligible 
                States.
            (ii) Amount if certain territories are eligible

                If, for a bonus year, Guam, the Virgin Islands, or 
            American Samoa is an eligible State, then the amount of the 
            grant shall be--
                    (I) in the case of such a territory, 25 percent of 
                the mandatory ceiling amount (as defined in section 
                1308(c)(4) of this title) with respect to the territory; 
                and
                    (II) in the case of a State that is not such a 
                territory--
                        (aa) if there are 5 eligible States other than 
                    such territories, $20,000,000, minus \1/5\ of the 
                    total amount of the grants payable under this 
                    paragraph to such territories for the bonus year; or
                        (bb) if there are fewer than 5 such eligible 
                    States, $25,000,000, or such lesser amount as may be 
                    necessary to ensure that the total amount of grants 
                    payable under this paragraph for the bonus year does 
                    not exceed $100,000,000.

        (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 
                    illegitimacy ratio of the State for the most recent 
                    2-year period for which such information is 
                    available decreased as compared to the illegitimacy 
                    ratio of the State for 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. In the case of a State that is not a 
                    territory specified in subparagraph (B), the 
                    comparative magnitude of the decrease for the State 
                    shall be determined without regard to the magnitude 
                    of the corresponding decrease for any such 
                    territory.
                        (bb) The rate of induced pregnancy terminations 
                    in the State for the calendar year for which the 
                    most recent data are available is less than the rate 
                    of induced pregnancy terminations in the State for 
                    calendar 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 illegitimacy 
                    ratio of a State for a calendar year and the 
                    illegitimacy ratio of a State for calendar year 1995 
                    which is attributable to a change in State methods 
                    of reporting data used to calculate the illegitimacy 
                    ratio; and
                        (bb) any difference between the rate of induced 
                    pregnancy terminations in a State for a calendar 
                    year and such rate for calendar 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 calendar years 1999, 2000, 
            2001, and 2002.
            (iii) Illegitimacy ratio

                The term ``illegitimacy ratio'' means, with respect to a 
            State and a period--
                    (I) the number of out-of-wedlock births to mothers 
                residing in the State that occurred during the period; 
                divided by
                    (II) the number of births to mothers residing in the 
                State that occurred during the period.

        (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 603 of this title (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 603 of this title (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 1998

                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 603 of this title (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 603 of this title (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 907(b)(2) of title 2, 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 August 22, 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 601(a) of this title.

        (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.

                     (5) Welfare-to-work grants

        (A) Formula grants

            (i) Entitlement

                A State shall be entitled to receive from the Secretary 
            of Labor a grant for each fiscal year specified in 
            subparagraph (I) of this paragraph for which the State is a 
            welfare-to-work State, in an amount that does not exceed the 
            lesser of--
                    (I) 2 times the total of the expenditures by the 
                State (excluding qualified State expenditures (as 
                defined in section 609(a)(7)(B)(i) of this title) and 
                any expenditure described in subclause (I), (II), or 
                (IV) of section 609(a)(7)(B)(iv) of this title) during 
                the period permitted under subparagraph (C)(vii) of this 
                paragraph for the expenditure of funds under the grant 
                for activities described in subparagraph (C)(i) of this 
                paragraph; or
                    (II) the allotment of the State under clause (iii) 
                of this subparagraph for the fiscal year.
            (ii) Welfare-to-work State

                A State shall be considered a welfare-to-work State for 
            a fiscal year for purposes of this paragraph if the 
            Secretary of Labor determines that the State meets the 
            following requirements:
                    (I) The State has submitted to the Secretary of 
                Labor and the Secretary of Health and Human Services (in 
                the form of an addendum to the State plan submitted 
                under section 602 of this title) a plan which--
                        (aa) describes how, consistent with this 
                    subparagraph, the State will use any funds provided 
                    under this subparagraph during the fiscal year;
                        (bb) specifies the formula to be used pursuant 
                    to clause (vi) to distribute funds in the State, and 
                    describes the process by which the formula was 
                    developed;
                        (cc) contains evidence that the plan was 
                    developed in consultation and coordination with 
                    appropriate entitites in sub-State areas;
                        (dd) contains assurances by the Governor of the 
                    State that the private industry council (and any 
                    alternate agency designated by the Governor under 
                    item (ee)) for a service delivery area in the State 
                    will coordinate the expenditure of any funds 
                    provided under this subparagraph for the benefit of 
                    the service delivery area with the expenditure of 
                    the funds provided to the State under paragraph (1);
                        (ee) if the Governor of the State desires to 
                    have an agency other than a private industry council 
                    administer the funds provided under this 
                    subparagraph for the benefit of 1 or more service 
                    delivery areas in the State, contains an application 
                    to the Secretary of Labor for a waiver of clause 
                    (vii)(I) with respect to the area or areas in order 
                    to permit an alternate agency designated by the 
                    Governor to so administer the funds; and
                        (ff) describes how the State will ensure that a 
                    private industry council to which information is 
                    disclosed pursuant to section 603(a)(5)(K) or 
                    654A(f)(5) of this title has procedures for 
                    safeguarding the information and for ensuring that 
                    the information is used solely for the purpose 
                    described in that section.

                    (II) The State has provided to the Secretary of 
                Labor an estimate of the amount that the State intends 
                to expend during the period permitted under subparagraph 
                (C)(vii) of this paragraph for the expenditure of funds 
                under the grant (excluding expenditures described in 
                section 609(a)(7)(B)(iv) of this title (other than 
                subclause (III) thereof)) pursuant to this paragraph.
                    (III) The State has agreed to negotiate in good 
                faith with the Secretary of Health and Human Services 
                with respect to the substance and funding of any 
                evaluation under section 613(j) of this title, and to 
                cooperate with the conduct of any such evaluation.
                    (IV) The State is an eligible State for the fiscal 
                year.
                    (V) The State certifies that qualified State 
                expenditures (within the meaning of section 609(a)(7) of 
                this title) for the fiscal year will be not less than 
                the applicable percentage of historic State expenditures 
                (within the meaning of section 609(a)(7) of this title) 
                with respect to the fiscal year.
            (iii) Allotments to welfare-to-work States

                (I) In general

                    Subject to this clause, the allotment of a welfare-
                to-work State for a fiscal year shall be the available 
                amount for the fiscal year, multiplied by the State 
                percentage for the fiscal year.
                (II) Minimum allotment

                    The allotment of a welfare-to-work State (other than 
                Guam, the Virgin Islands, or American Samoa) for a 
                fiscal year shall not be less than 0.25 percent of the 
                available amount for the fiscal year.
                (III) Pro rata reduction

                    Subject to subclause (II), the Secretary of Labor 
                shall make pro rata reductions in the allotments to 
                States under this clause for a fiscal year as necessary 
                to ensure that the total of the allotments does not 
                exceed the available amount for the fiscal year.
            (iv) Available amount

                As used in this subparagraph, the term ``available 
            amount'' means, for a fiscal year, the sum of--
                    (I) 75 percent of the sum of--
                        (aa) the amount specified in subparagraph (I) 
                    for the fiscal year, minus the total of the amounts 
                    reserved pursuant to subparagraphs (E), (F), (G), 
                    and (H) for the fiscal year; and
                        (bb) any amount reserved pursuant to 
                    subparagraph (F) for the immediately preceding 
                    fiscal year that has not been obligated; and

                    (II) any available amount for the immediately 
                preceding fiscal year that has not been obligated by a 
                State, other than funds reserved by the State for 
                distribution under clause (vi)(III) and funds 
                distributed pursuant to clause (vi)(I) in any State in 
                which the service delivery area is the State.
            (v) State percentage

                As used in clause (iii), the term ``State percentage'' 
            means, with respect to a fiscal year, \1/2\ of the sum of--
                    (I) the percentage represented by the number of 
                individuals in the State whose income is less than the 
                poverty line divided by the number of such individuals 
                in the United States; and
                    (II) the percentage represented by the number of 
                adults who are recipients of assistance under the State 
                program funded under this part divided by the number of 
                adults in the United States who are recipients of 
                assistance under any State program funded under this 
                part.
            (vi) Procedure for distribution of funds within 
                    States

                (I) Allocation formula

                    A State to which a grant is made under this 
                subparagraph shall devise a formula for allocating not 
                less than 85 percent of the amount of the grant among 
                the service delivery areas in the State, which--
                        (aa) determines the amount to be allocated for 
                    the benefit of a service delivery area in proportion 
                    to the number (if any) by which the population of 
                    the area with an income that is less than the 
                    poverty line exceeds 7.5 percent of the total 
                    population of the area, relative to such number for 
                    all such areas in the State with such an excess, and 
                    accords a weight of not less than 50 percent to this 
                    factor;
                        (bb) may determine the amount to be allocated 
                    for the benefit of such an area in proportion to the 
                    number of adults residing in the area who have been 
                    recipients of assistance under the State program 
                    funded under this part (whether in effect before or 
                    after the amendments made by section 103(a) of the 
                    Personal Responsibility and Work Opportunity 
                    Reconciliation Act of 1996 first applied to the 
                    State) for at least 30 months (whether or not 
                    consecutive) relative to the number of such adults 
                    residing in the State; and
                        (cc) may determine the amount to be allocated 
                    for the benefit of such an area in proportion to the 
                    number of unemployed individuals residing in the 
                    area relative to the number of such individuals 
                    residing in the State.
                (II) Distribution of funds

(aa) In general

                        If the amount allocated by the formula to a 
                    service delivery area is at least $100,000, the 
                    State shall distribute the amount to the entity 
                    administering the grant in the area.

(bb) Special rule

                        If the amount allocated by the formula to a 
                    service delivery area is less than $100,000, the sum 
                    shall be available for distribution in the State 
                    under subclause (III) during the fiscal year.
                (III) Projects to help long-term recipients of 
                        assistance enter unsubsidized jobs

                    The Governor of a State to which a grant is made 
                under this subparagraph may distribute not more than 15 
                percent of the grant funds (plus any amount required to 
                be distributed under this subclause by reason of 
                subclause (II)(bb)) to projects that appear likely to 
                help long-term recipients of assistance under the State 
                program funded under this part (whether in effect before 
                or after the amendments made by section 103(a) of the 
                Personal Responsibility and Work Opportunity 
                Reconciliation Act of 1996 first applied to the State) 
                enter unsubsidized employment.
            (vii) Administration

                (I) Private industry councils

                    The private industry council for a service delivery 
                area in a State shall have sole authority, in 
                coordination with the chief elected official (as 
                described in section 103(c) of the Job Training 
                Partnership Act [29 U.S.C. 1513(c)] or defined in 
                section 101 of the Workforce Investment Act of 1998 [29 
                U.S.C. 2801]) of the area, to expend the amounts 
                distributed under clause (vi)(II)(aa) for the benefit of 
                the service delivery area, in accordance with the 
                assurances described in clause (ii)(I)(dd) provided by 
                the Governor of the State.
                (II) Enforcement of coordination of expenditures 
                        with other expenditures under this part

                    Notwithstanding subclause (I) of this clause, on a 
                determination by the Governor of a State that a private 
                industry council (or an alternate agency described in 
                clause (ii)(I)(dd)) has used funds provided under this 
                subparagraph in a manner inconsistent with the 
                assurances described in clause (ii)(I)(dd)--
                        (aa) the private industry council (or such 
                    alternate agency) shall remit the funds to the 
                    Governor; and
                        (bb) the Governor shall apply to the Secretary 
                    of Labor for a waiver of subclause (I) of this 
                    clause with respect to the service delivery area or 
                    areas involved in order to permit an alternate 
                    agency designated by the Governor to administer the 
                    funds in accordance with the assurances.
                (III) Authority to permit use of alternate 
                        administering agency

                    The Secretary of Labor shall approve an application 
                submitted under clause (ii)(I)(ee) or subclause (II)(bb) 
                of this clause to waive subclause (I) of this clause 
                with respect to 1 or more service delivery areas if the 
                Secretary determines that the alternate agency 
                designated in the application would improve the 
                effectiveness or efficiency of the administration of 
                amounts distributed under clause (vi)(II)(aa) for the 
                benefit of the area or areas.
            (viii) Data to be used in determining the number of 
                    adult TANF recipients

                For purposes of this subparagraph, the number of adult 
            recipients of assistance under a State program funded under 
            this part for a fiscal year shall be determined using data 
            for the most recent 12-month period for which such data is 
            available before the beginning of the fiscal year.
            (ix) Reversion of unallotted formula funds

                If at the end of any fiscal year any funds available 
            under this subparagraph have not been allotted due to a 
            determination by the Secretary that any State has not met 
            the requirements of clause (ii), such funds shall be 
            transferred to the General Fund of the Treasury of the 
            United States.

        (B) Competitive grants

            (i) In general

                The Secretary of Labor shall award grants in accordance 
            with this subparagraph, in fiscal years 1998 and 1999, for 
            projects proposed by eligible applicants, based on the 
            following:
                    (I) The effectiveness of the proposal in--
                        (aa) expanding the base of knowledge about 
                    programs aimed at moving recipients of assistance 
                    under State programs funded under this part who are 
                    least job ready into unsubsidized employment.
                        (bb) moving recipients of assistance under State 
                    programs funded under this part who are least job 
                    ready into unsubsidized employment; and
                        (cc) moving recipients of assistance under State 
                    programs funded under this part who are least job 
                    ready into unsubsidized employment, even in labor 
                    markets that have a shortage of low-skill jobs.

                    (II) At the discretion of the Secretary of Labor, 
                any of the following:
                        (aa) The history of success of the applicant in 
                    moving individuals with multiple barriers into work.
                        (bb) Evidence of the applicant's ability to 
                    leverage private, State, and local resources.
                        (cc) Use by the applicant of State and local 
                    resources beyond those required by subparagraph (A).
                        (dd) Plans of the applicant to coordinate with 
                    other organizations at the local and State level.
                        (ee) Use by the applicant of current or former 
                    recipients of assistance under a State program 
                    funded under this part as mentors, case managers, or 
                    service providers.
            (ii) Eligible applicants

                As used in clause (i), the term ``eligible applicant'' 
            means a private industry council for a service delivery area 
            in a State, a political subdivision of a State, or a private 
            entity applying in conjunction with the private industry 
            council for such a service delivery area or with such a 
            political subdivision, that submits a proposal developed in 
            consultation with the Governor of the State.
            (iii) Determination of grant amount

                In determining the amount of a grant to be made under 
            this subparagraph for a project proposed by an applicant, 
            the Secretary of Labor shall provide the applicant with an 
            amount sufficient to ensure that the project has a 
            reasonable opportunity to be successful, taking into account 
            the number of long-term recipients of assistance under a 
            State program funded under this part, the level of 
            unemployment, the job opportunities and job growth, the 
            poverty rate, and such other factors as the Secretary of 
            Labor deems appropriate, in the area to be served by the 
            project.
            (iv) Consideration of needs of rural areas and 
                    cities with large concentrations of poverty

                In making grants under this subparagraph, the Secretary 
            of Labor shall consider the needs of rural areas and cities 
            with large concentrations of residents with an income that 
            is less than the poverty line.
            (v) Funding

                For grants under this subparagraph for each fiscal year 
            specified in subparagraph (I), there shall be available to 
            the Secretary of Labor an amount equal to the sum of--
                    (I) 25 percent of the sum of--
                        (aa) the amount specified in subparagraph (I) 
                    for the fiscal year, minus the total of the amounts 
                    reserved pursuant to subparagraphs (E), (F), (G), 
                    and (H) for the fiscal year; and
                        (bb) any amount reserved pursuant to 
                    subparagraph (F) for the immediately preceding 
                    fiscal year that has not been obligated; and

                    (II) any amount available for grants under this 
                subparagraph for the immediately preceding fiscal year 
                that has not been obligated.

        (C) Limitations on use of funds

            (i) Allowable activities

                An entity to which funds are provided under this 
            paragraph shall use the funds to move individuals into and 
            keep individuals in lasting unsubsidized employment by means 
            of any of the following:
                    (I) The conduct and administration of community 
                service or work experience programs.
                    (II) Job creation through public or private sector 
                employment wage subsidies.
                    (III) On-the-job training.
                    (IV) Contracts with public or private providers of 
                readiness, placement, and post-employment services, or 
                if the entity is not a private industry council or 
                workforce investment board, the direct provision of such 
                services.
                    (V) Job vouchers for placement, readiness, and 
                postemployment services.
                    (VI) Job retention or support services if such 
                services are not otherwise available.
                    (VII) Not more than 6 months of vocational 
                educational or job training.

          Contracts or vouchers for job placement services supported by 
            such funds must require that at least \1/2\ of the payment 
            occur after an eligible individual placed into the workforce 
            has been in the workforce for 6 months.
            (ii) General eligibility

                An entity that operates a project with funds provided 
            under this paragraph may expend funds provided to the 
            project for the benefit of recipients of assistance under 
            the program funded under this part of the State in which the 
            entity is located who--
                    (I) has received assistance under the State program 
                funded under this part (whether in effect before or 
                after the amendments made by section 103 of the Personal 
                Responsibility and Work Opportunity Reconciliation Act 
                of 1996 first apply to the State) for at least 30 months 
                (whether or not consecutive); or
                    (II) within 12 months, will become ineligible for 
                assistance under the State program funded under this 
                part by reason of a durational limit on such assistance, 
                without regard to any exemption provided pursuant to 
                section 608(a)(7)(C) of this title that may apply to the 
                individual.
            (iii) Noncustodial parents

                An entity that operates a project with funds provided 
            under this paragraph may use the funds to provide services 
            in a form described in clause (i) to noncustodial parents 
            with respect to whom the requirements of the following 
            subclauses are met:
                    (I) The noncustodial parent is unemployed, 
                underemployed, or having difficulty in paying child 
                support obligations.
                    (II) At least 1 of the following applies to a minor 
                child of the noncustodial parent (with preference in the 
                determination of the noncustodial parents to be provided 
                services under this paragraph to be provided by the 
                entity to those noncustodial parents with minor children 
                who meet, or who have custodial parents who meet, the 
                requirements of item (aa)):
                        (aa) The minor child or the custodial parent of 
                    the minor child meets the requirements of subclause 
                    (I) or (II) of clause (ii).
                        (bb) The minor child is eligible for, or is 
                    receiving, benefits under the program funded under 
                    this part.
                        (cc) The minor child received benefits under the 
                    program funded under this part in the 12-month 
                    period preceding the date of the determination but 
                    no longer receives such benefits.
                        (dd) The minor child is eligible for, or is 
                    receiving, assistance under the Food Stamp Act of 
                    1977 [7 U.S.C. 2011 et seq.], benefits under the 
                    supplemental security income program under 
                    subchapter XVI of this chapter, medical assistance 
                    under subchapter XIX of this chapter, or child 
                    health assistance under subchapter XXI of this 
                    chapter.

                    (III) In the case of a noncustodial parent who 
                becomes enrolled in the project on or after November 29, 
                1999, the noncustodial parent is in compliance with the 
                terms of an oral or written personal responsibility 
                contract entered into among the noncustodial parent, the 
                entity, and (unless the entity demonstrates to the 
                Secretary that the entity is not capable of coordinating 
                with such agency) the agency responsible for 
                administering the State plan under part D of this 
                subchapter, which was developed taking into account the 
                employment and child support status of the noncustodial 
                parent, which was entered into not later than 30 (or, at 
                the option of the entity, not later than 90) days after 
                the noncustodial parent was enrolled in the project, and 
                which, at a minimum, includes the following:
                        (aa) A commitment by the noncustodial parent to 
                    cooperate, at the earliest opportunity, in the 
                    establishment of the paternity of the minor child, 
                    through voluntary acknowledgement or other 
                    procedures, and in the establishment of a child 
                    support order.
                        (bb) A commitment by the noncustodial parent to 
                    cooperate in the payment of child support for the 
                    minor child, which may include a modification of an 
                    existing support order to take into account the 
                    ability of the noncustodial parent to pay such 
                    support and the participation of such parent in the 
                    project.
                        (cc) A commitment by the noncustodial parent to 
                    participate in employment or related activities that 
                    will enable the noncustodial parent to make regular 
                    child support payments, and if the noncustodial 
                    parent has not attained 20 years of age, such 
                    related activities may include completion of high 
                    school, a general equivalency degree, or other 
                    education directly related to employment.
                        (dd) A description of the services to be 
                    provided under this paragraph, and a commitment by 
                    the noncustodial parent to participate in such 
                    services, that are designed to assist the 
                    noncustodial parent obtain and retain employment, 
                    increase earnings, and enhance the financial and 
                    emotional contributions to the well-being of the 
                    minor child.

             In order to protect custodial parents and children who may 
                     be at risk of domestic violence, the preceding 
                 provisions of this subclause shall not be construed to 
                affect any other provision of law requiring a custodial 
                 parent to cooperate in establishing the paternity of a 
                child or establishing or enforcing a support order with 
                 respect to a child, or entitling a custodial parent to 
                refuse, for good cause, to provide such cooperation as a 
                 condition of assistance or benefit under any program, 
                 shall not be construed to require such cooperation by 
                the custodial parent as a condition of participation of 
                   either parent in the program authorized under this 
                   paragraph, and shall not be construed to require a 
                custodial parent to cooperate with or participate in any 
                   activity under this clause. The entity operating a 
                project under this clause with funds provided under this 
                     paragraph shall consult with domestic violence 
                    prevention and intervention organizations in the 
                               development of the project.

            (iv) Targeting of hard to employ individuals with 
                    characteristics associated with long-term 
                    welfare dependence

                An entity that operates a project with funds provided 
            under this paragraph may expend not more than 30 percent of 
            all funds provided to the project for programs that provide 
            assistance in a form described in clause (i)--
                    (I) to recipients of assistance under the program 
                funded under this part of the State in which the entity 
                is located who have characteristics associated with 
                long-term welfare dependence (such as school dropout, 
                teen pregnancy, or poor work history), including, at the 
                option of the State, by providing assistance in such 
                form as a condition of receiving assistance under the 
                State program funded under this part;
                    (II) to children--
                        (aa) who have attained 18 years of age but not 
                    25 years of age; and
                        (bb) who, before attaining 18 years of age, were 
                    recipients of foster care maintenance payments (as 
                    defined in section 675(4) of this title) under part 
                    E of this subchapter or were in foster care under 
                    the responsibility of a State;

                    (III) to recipients of assistance under the State 
                program funded under this part, determined to have 
                significant barriers to self-sufficiency, pursuant to 
                criteria established by the local private industry 
                council; or
                    (IV) to custodial parents with incomes below 100 
                percent of the poverty line (as defined in section 
                9902(2) of this title, including any revision required 
                by such section, applicable to a family of the size 
                involved).

          To the extent that the entity does not expend such funds in 
            accordance with the preceding sentence, the entity shall 
            expend such funds in accordance with clauses (ii) and (iii) 
            and, as appropriate, clause (v).
            (v) Authority to provide work-related services to 
                    individuals who have reached the 5-year 
                    limit

                An entity that operates a project with funds provided 
            under this paragraph may use the funds to provide assistance 
            in a form described in clause (i) of this subparagraph to, 
            or for the benefit of, individuals who (but for section 
            608(a)(7) of this title) would be eligible for assistance 
            under the program funded under this part of the State in 
            which the entity is located.
            (vi) Relationship to other provisions of this part

                (I) Rules governing use of funds

                    The rules of section 604 of this title, other than 
                subsections (b), (f), and (h) of section 604 of this 
                title, shall not apply to a grant made under this 
                paragraph.
                (II) Rules governing payments to States

                    The Secretary of Labor shall carry out the functions 
                otherwise assigned by section 605 of this title to the 
                Secretary of Health and Human Services with respect to 
                the grants payable under this paragraph.
                (III) Administration

                    Section 616 of this title shall not apply to the 
                programs under this paragraph.
            (vii) Prohibition against use of grant funds for any 
                    other fund matching requirement

                An entity to which funds are provided under this 
            paragraph shall not use any part of the funds, nor any part 
            of State expenditures made to match the funds, to fulfill 
            any obligation of any State, political subdivision, or 
            private industry council to contribute funds under 
            subsection (b) of this section or section 618 of this title 
            or any other provision of this chapter or other Federal law.
            (viii) Deadline for expenditure

                An entity to which funds are provided under this 
            paragraph shall remit to the Secretary of Labor any part of 
            the funds that are not expended within 3 years after the 
            date the funds are so provided.
            (ix) Regulations

                Within 90 days after August 5, 1997, the Secretary of 
            Labor, after consultation with the Secretary of Health and 
            Human Services and the Secretary of Housing and Urban 
            Development, shall prescribe such regulations as may be 
            necessary to implement this paragraph.
            (x) Reporting requirements

                The Secretary of Labor, in consultation with the 
            Secretary of Health and Human Services, States, and 
            organizations that represent State or local governments, 
            shall establish requirements for the collection and 
            maintenance of financial and participant information and the 
            reporting of such information by entities carrying out 
            activities under this paragraph.

        (D) Definitions

            (i) Individuals with income less than the poverty 
                    line

                For purposes of this paragraph, the number of 
            individuals with an income that is less than the poverty 
            line shall be determined for a fiscal year--
                    (I) based on the methodology used by the Bureau of 
                the Census to produce and publish intercensal poverty 
                data for States and counties (or, in the case of Puerto 
                Rico, the Virgin Islands, Guam, and American Samoa, 
                other poverty data selected by the Secretary of Labor); 
                and
                    (II) using data for the most recent year for which 
                such data is available before the beginning of the 
                fiscal year.
            (ii) Private industry council

                As used in this paragraph, the term ``private industry 
            council'' means, with respect to a service delivery area, 
            the private industry council or local workforce investment 
            board established for the service delivery area pursuant to 
            the Job Training Partnership Act [29 U.S.C. 1501 et seq.] or 
            title I of the Workforce Investment Area \1\ of 1998 [29 
            U.S.C. 2801 et seq.], as appropriate.
---------------------------------------------------------------------------
    \1\ So in original. Probably should be ``Act''.
---------------------------------------------------------------------------
            (iii) Service delivery area

                As used in this paragraph, the term ``service delivery 
            area'' shall have the meaning given such term for purposes 
            of the Job Training Partnership Act [29 U.S.C. 1501 et seq.] 
            or shall mean a local area as defined in section 101 of the 
            Workforce Investment Act of 1998 [29 U.S.C. 2801], as 
            appropriate.

        (E) Set-aside for successful performance bonus

            (i) In general

                The Secretary of Labor shall award a grant in accordance 
            with this subparagraph to each successful performance State 
            in fiscal year 2000, but shall not make any outlay to pay 
            any such grant before October 1, 2000.
            (ii) Amount of grant

                The Secretary of Labor shall determine the amount of the 
            grant payable under this subparagraph to a successful 
            performance State, which shall be based on the score 
            assigned to the State under clause (iv)(I)(aa) for such 
            prior period as the Secretary of Labor deems appropriate.
            (iii) Formula for measuring State performance

                Not later than 1 year after August 5, 1997, the 
            Secretary of Labor, in consultation with the Secretary of 
            Health and Human Services, the National Governors' 
            Association, and the American Public Welfare Association, 
            shall develop a formula for measuring--
                    (I) the success of States in placing individuals in 
                private sector employment or in any kind of employment, 
                through programs operated with funds provided under 
                subparagraph (A);
                    (II) the duration of such placements;
                    (III) any increase in the earnings of such 
                individuals; and
                    (IV) such other factors as the Secretary of Labor 
                deems appropriate concerning the activities of the 
                States with respect to such individuals.

          The formula may take into account general economic conditions 
            on a State-by-State basis.
            (iv) Scoring of State performance; setting of 
                    performance thresholds

                (I) In general

                    The Secretary of Labor shall--
                        (aa) use the formula developed under clause 
                    (iii) to assign a score to each State that was a 
                    welfare-to-work State for fiscal years 1998 and 
                    1999; and
                        (bb) prescribe a performance threshold in such a 
                    manner so as to ensure that the total amount of 
                    grants to be made under this paragraph equals 
                    $50,000,000.
                (II) Availability of welfare-to-work data 
                        submitted to the Secretary of HHS

                    The Secretary of Health and Human Services shall 
                provide the Secretary of Labor with the data reported by 
                States under this part with respect to programs operated 
                with funds provided under subparagraph (A).
            (v) ``Successful performance State'' defined

                As used in this subparagraph, the term ``successful 
            performance State'' means a State whose score assigned 
            pursuant to clause (iv)(I)(aa) equals or exceeds the 
            performance threshold prescribed under clause (iv)(I)(bb).
            (vi) Set-aside

                $50,000,000 of the amount specified in subparagraph (I) 
            for fiscal year 1999 shall be reserved for grants under this 
            subparagraph.

        (F) Funding for Indian tribes

            1 percent of the amount specified in subparagraph (I) for 
        fiscal year 1998 and $1,500,000 of the amount so specified for 
        fiscal year 1999 shall be reserved for grants to Indian tribes 
        under section 612(a)(3) of this title.

        (G) Funding for evaluations of welfare-to-work programs

            0.6 percent of the amount specified in subparagraph (I) for 
        fiscal year 1998 and $900,000 of the amount so specified for 
        fiscal year 1999 shall be reserved for use by the Secretary to 
        carry out section 613(j) of this title.

        (H) Funding for evaluation of abstinence education programs

            (i) In general

                0.2 percent of the amount specified in subparagraph (I) 
            for fiscal year 1998 and $300,000 of the amount so specified 
            for fiscal year 1999 shall be reserved for use by the 
            Secretary to evaluate programs under section 710 of this 
            title, directly or through grants, contracts, or interagency 
            agreements.
            (ii) Authority to use funds for evaluations of 
                    welfare-to-work programs

                Any such amount not required for such evaluations shall 
            be available for use by the Secretary to carry out section 
            613(j) of this title.
            (iii) Deadline for outlays

                Outlays from funds used pursuant to clause (i) for 
            evaluation of programs under section 710 of this title shall 
            not be made after fiscal year 2001.

        (I) Appropriations

            (i) In general

                Out of any money in the Treasury of the United States 
            not otherwise appropriated, there are appropriated for 
            grants under this paragraph--
                    (I) $1,500,000,000 for fiscal year 1998; and
                    (II) $1,450,000,000 for fiscal year 1999.
            (ii) Availability

                The amounts made available pursuant to clause (i) shall 
            remain available for such period as is necessary to make the 
            grants provided for in this paragraph.

        (J) Worker protections

            (i) Nondisplacement in work activities

                (I) General prohibition

                    Subject to this clause, an adult in a family 
                receiving assistance attributable to funds provided 
                under this paragraph may fill a vacant employment 
                position in order to engage in a work activity.
                (II) Prohibition against violation of contracts

                    A work activity engaged in under a program operated 
                with funds provided under this paragraph shall not 
                violate an existing contract for services or a 
                collective bargaining agreement, and such a work 
                activity that would violate a collective bargaining 
                agreement shall not be undertaken without the written 
                concurrence of the labor organization and employer 
                concerned.
                (III) Other prohibitions

                    An adult participant in a work activity engaged in 
                under a program operated with funds provided under this 
                paragraph shall not be employed or assigned--
                        (aa) when any other individual is on layoff from 
                    the same or any substantially equivalent job;
                        (bb) if the employer has terminated the 
                    employment of any regular employee or otherwise 
                    caused an involuntary reduction in its workforce 
                    with the intention of filling the vacancy so created 
                    with the participant; or
                        (cc) if the employer has caused an involuntary 
                    reduction to less than full time in hours of any 
                    employee in the same or a substantially equivalent 
                    job.
            (ii) Health and safety

                Health and safety standards established under Federal 
            and State law otherwise applicable to working conditions of 
            employees shall be equally applicable to working conditions 
            of other participants engaged in a work activity under a 
            program operated with funds provided under this paragraph.
            (iii) Nondiscrimination

                In addition to the protections provided under the 
            provisions of law specified in section 608(c) of this title, 
            an individual may not be discriminated against by reason of 
            gender with respect to participation in work activities 
            engaged in under a program operated with funds provided 
            under this paragraph.
            (iv) Grievance procedure

                (I) In general

                    Each State to which a grant is made under this 
                paragraph shall establish and maintain a procedure for 
                grievances or complaints from employees alleging 
                violations of clause (i) and participants in work 
                activities alleging violations of clause (i), (ii), or 
                (iii).
                (II) Hearing

                    The procedure shall include an opportunity for a 
                hearing.
                (III) Remedies

                    The procedure shall include remedies for violation 
                of clause (i), (ii), or (iii), which may continue during 
                the pendency of the procedure, and which may include--
                        (aa) suspension or termination of payments from 
                    funds provided under this paragraph;
                        (bb) prohibition of placement of a participant 
                    with an employer that has violated clause (i), (ii), 
                    or (iii);
                        (cc) where applicable, reinstatement of an 
                    employee, payment of lost wages and benefits, and 
                    reestablishment of other relevant terms, conditions 
                    and privileges of employment; and
                        (dd) where appropriate, other equitable relief.
                (IV) Appeals

(aa) Filing

                        Not later than 30 days after a grievant or 
                    complainant receives an adverse decision under the 
                    procedure established pursuant to subclause (I), the 
                    grievant or complainant may appeal the decision to a 
                    State agency designated by the State which shall be 
                    independent of the State or local agency that is 
                    administering the programs operated with funds 
                    provided under this paragraph and the State agency 
                    administering, or supervising the administration of, 
                    the State program funded under this part.

(bb) Final determination

                        Not later than 120 days after the State agency 
                    designated under item (aa) receives a grievance or 
                    complaint made under the procedure established by a 
                    State pursuant to subclause (I), the State agency 
                    shall make a final determination on the appeal.
            (v) Rule of interpretation

                This subparagraph shall not be construed to affect the 
            authority of a State to provide or require workers' 
            compensation.
            (vi) Nonpreemption of State law

                The provisions of this subparagraph shall not be 
            construed to preempt any provision of State law that affords 
            greater protections to employees or to other participants 
            engaged in work activities under a program funded under this 
            part than is afforded by such provisions of this 
            subparagraph.

        (K) Information disclosure

            If a State to which a grant is made under this section 
        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 to a private industry council the names, addresses, 
        telephone numbers, and identifying case number information in 
        the State program funded under this part, of noncustodial 
        parents residing in the service delivery area of the private 
        industry council, for the purpose of identifying and contacting 
        noncustodial parents regarding participation in the program 
        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, 
    reduced by the sum of the dollar amounts specified in paragraph 
    (6)(C)(ii).

                             (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) ``Eligible month'' defined

        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.

                           (5) Needy State

        For purposes of paragraph (4), 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.

                      (6) Annual reconciliation

        (A) In general

            Notwithstanding paragraph (3), if the Secretary makes a 
        payment to a State under this subsection in a fiscal year, then 
        the State shall remit to the Secretary, within 1 year after the 
        end of the first subsequent period of 3 consecutive months for 
        which the State is not a needy State, an amount equal to the 
        amount (if any) by which--
                (i) the total amount paid to the State under paragraph 
            (3) of this subsection in the fiscal year; exceeds
                (ii) the product of--
                    (I) the Federal medical assistance percentage for 
                the State (as defined in section 1396d(b) of this title, 
                as such section was in effect on September 30, 1995);
                    (II) the State's reimbursable expenditures for the 
                fiscal year; and
                    (III) \1/12\ times the number of months during the 
                fiscal year for which the Secretary made a payment to 
                the State under such paragraph (3).

        (B) Definitions

            As used in subparagraph (A):
            (i) Reimbursable expenditures

                The term ``reimbursable expenditures'' means, with 
            respect to a State and a fiscal year, the amount (if any) by 
            which--
                    (I) countable State expenditures for the fiscal 
                year; exceeds
                    (II) historic State expenditures (as defined in 
                section 609(a)(7)(B)(iii) of this title), excluding any 
                amount expended by the State for child care under 
                subsection (g) or (i) of section 602 of this title (as 
                in effect during fiscal year 1994) for fiscal year 1994.
            (ii) Countable State expenditures

                The term ``countable expenditures'' means, with respect 
            to a State and a fiscal year--
                    (I) the qualified State expenditures (as defined in 
                section 609(a)(7)(B)(i) of this title (other than the 
                expenditures described in subclause (I)(bb) of such 
                section)) under the State program funded under this part 
                for the fiscal year; plus
                    (II) any amount paid to the State under paragraph 
                (3) during the fiscal year that is expended by the State 
                under the State program funded under this part.

        (C) Adjustment of State remittances

            (i) In general

                The amount otherwise required by subparagraph (A) to be 
            remitted by a State for a fiscal year shall be increased by 
            the lesser of--
                    (I) the total adjustment for the fiscal year, 
                multiplied by the adjustment percentage for the State 
                for the fiscal year; or
                    (II) the unadjusted net payment to the State for the 
                fiscal year.
            (ii) Total adjustment

                As used in clause (i), the term ``total adjustment'' 
            means--
                    (I) in the case of fiscal year 1998, $2,000,000;
                    (II) in the case of fiscal year 1999, $9,000,000;
                    (III) in the case of fiscal year 2000, $16,000,000; 
                and
                    (IV) in the case of fiscal year 2001, $13,000,000.
            (iii) Adjustment percentage

                As used in clause (i), the term ``adjustment 
            percentage'' means, with respect to a State and a fiscal 
            year--
                    (I) the unadjusted net payment to the State for the 
                fiscal year; divided by
                    (II) the sum of the unadjusted net payments to all 
                States for the fiscal year.
            (iv) Unadjusted net payment

                As used in this subparagraph, the term, ``unadjusted net 
            payment'' means with respect to a State and a fiscal year--
                    (I) the total amount paid to the State under 
                paragraph (3) in the fiscal year; minus
                    (II) the amount that, in the absence of this 
                subparagraph, would be required by subparagraph (A) or 
                by section 609(a)(10) of this title to be remitted by 
                the State in respect of the payment.

                        (7) ``State'' defined

        As used in this subsection, the term ``State'' means each of the 
    50 States and the District of Columbia.

                         (8) Annual reports

        The Secretary shall annually report to the Congress on the 
    status of the Fund.

(Aug. 14, 1935, ch. 531, title IV, Sec. 403, as added Pub. L. 104-193, 
title I, Sec. 103(a)(1), Aug. 22, 1996, 110 Stat. 2115; amended Pub. L. 
104-327, Sec. 1(b), Oct. 19, 1996, 110 Stat. 4002; Pub. L. 105-33, title 
V, Secs. 5001(a)(1), 5502, 5514(c), Aug. 5, 1997, 111 Stat. 577, 606, 
620; Pub. L. 105-78, title VI, Sec. 608, Nov. 13, 1997, 111 Stat. 1522; 
Pub. L. 105-89, title IV, Sec. 404(a), (b), Nov. 19, 1997, 111 Stat. 
2134; Pub. L. 105-200, title IV, Sec. 408, July 16, 1998, 112 Stat. 672; 
Pub. L. 105-277, div. A, Sec. 101(f) [title I, Sec. 102, title VIII, 
Sec. 405(d)(30), (f)(22)], Oct. 21, 1998, 112 Stat. 2681-337, 2681-346, 
2681-425, 2681-432; Pub. L. 105-306, Sec. 6(a), Oct. 28, 1998, 112 Stat. 
2928; Pub. L. 106-113, div. B, Sec. 1000(a)(4) [title VIII, 
Secs. 801(a), (b)(1), (c), 802, 803, 804(b), 805(a)(2), (b), 806], Nov. 
29, 1999, 113 Stat. 1535, 1501A-280, 1501A-281, 1501A-283 to 1501A-286.)

                     Amendment of Subsection (a)(5)

        Pub. L. 105-277, div. A, Sec. 101(f) [title VIII, 
    Sec. 405(f)(22), (g)(2)(B)], Oct. 21, 1998, 112 Stat. 2681-337, 
    2681-432, 2681-435, provided that, effective July 1, 2000, 
    subsection (a)(5) of this section is amended as follows:
        (1) in subparagraph (A)(vii)(I), by striking ``described in 
    section 103(c) of the Job Training Partnership Act or''; and
        (2) in subparagraph (D)--
        (A) in clause (ii), by striking ``the Job Training Partnership 
    Act or''; and
        (B) in clause (iii), by striking ``shall mean a local area as 
    defined in section 101 of the Workforce Investment Act of 1998, as 
    appropriate''.

                       References in Text

    Part F of this subchapter, referred to in subsec. (a)(1)(B)(iii), 
(C)(i)(V), was classified to section 681 et seq. of this title, prior to 
repeal by Pub. L. 104-193, title I, Sec. 108(e), Aug. 22, 1996, 110 
Stat. 2167.
    Section 103 of the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996, referred to in subsec. (a)(5)(A)(vi)(I)(bb), 
(III), (C)(ii)(I), is section 103 of Pub. L. 104-193, which enacted this 
part, amended sections 602, 603, and 1308 of this title, and repealed 
provisions formerly set out as this part. For complete classification of 
section 103 to the Code, see Tables.
    The Food Stamp Act of 1977, referred to in subsec. 
(a)(5)(C)(iii)(II)(dd), is Pub. L. 88-525, Aug. 31, 1964, 78 Stat. 703, 
as amended, which is classified generally to chapter 51 (Sec. 2011 et 
seq.) of Title 7, Agriculture. For complete classification of this Act 
to the Code, see Short Title note set out under section 2011 of Title 7 
and Tables.
    Parts D and E of this subchapter, referred to in subsec. 
(a)(5)(C)(iii)(III), (iv)(II)(bb), are classified to sections 651 et 
seq. and 670 et seq., respectively, of this title.
    The Job Training Partnership Act, referred to in subsec. 
(a)(5)(D)(ii), (iii), is Pub. L. 97-300, Oct. 13, 1982, 96 Stat. 1322, 
as amended, which is classified generally to chapter 19 (Sec. 1501 et 
seq.) of Title 29, Labor. For complete classification of this Act to the 
Code, see Short Title note set out under section 1501 of Title 29 and 
Tables.
    The Workforce Investment Act of 1998, referred to in subsec. 
(a)(5)(D)(ii), is Pub. L. 105-220, Aug. 7, 1998, 112 Stat. 936, as 
amended. Title I of the Act is classified generally to chapter 30 
(Sec. 2801 et seq.) of Title 29, Labor. For complete classification of 
this Act to the Code, see Short Title note set out under section 9201 of 
Title 20, Education, and Tables.
    Titles IV and VIII of the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996, referred to in subsec. 
(b)(5)(B), are titles IV (Sec. 400 et seq.) and VIII (Sec. 801 et seq.) 
of Pub. L. 104-193, Aug. 22, 1996, 110 Stat. 2260, 2308. For complete 
classification of these titles to the Code, see Tables.


                            Prior Provisions

    A prior section 603, acts Aug. 14, 1935, ch. 531, title IV, 
Sec. 403, 49 Stat. 628; Aug. 10, 1939, ch. 666, title IV, Sec. 402, 53 
Stat. 1380; Aug. 10, 1946, ch. 951, title V, Sec. 502, 60 Stat. 992; 
June 14, 1948, ch. 468, Sec. 3(b), 62 Stat. 439; Aug. 28, 1950, ch. 809, 
title III, pt. 2, Sec. 322(a), pt. 6, Sec. 361(c), (d), 64 Stat. 550, 
558; July 18, 1952, ch. 945, Sec. 8(b), 66 Stat. 778; Sept. 1, 1954, ch. 
1206, title III, Sec. 303(a), 68 Stat. 1097; Aug. 1, 1956, ch. 836, 
title III, Secs. 302, 312(c), 342, 351(a), 70 Stat. 847, 849, 852, 854; 
Aug. 28, 1958, Pub. L. 85-840, title V, Sec. 502, 72 Stat. 1048; July 
25, 1962, Pub. L. 87-543, title I, Secs. 101(a)(2), (b)(2)(A)-(C), 
104(a)(3)(C), 108(b), (c), 76 Stat. 174, 180, 185, 190; July 30, 1965, 
Pub. L. 89-97, title I, Sec. 122, title IV, Sec. 401(c), 79 Stat. 353, 
415; Jan. 2, 1968, Pub. L. 90-248, title II, Secs. 201(c)-(e)(3), 
205(b), 206(a), 207(b), 208, 241(b)(2), (3), 81 Stat. 879, 880, 892-894, 
916; June 28, 1968, Pub. L. 90-364, title III, Sec. 301, 82 Stat. 273; 
July 9, 1969, Pub. L. 91-41, Sec. 3, 83 Stat. 45; Dec. 28, 1971, Pub. L. 
92-223, Sec. 3(a)(8), (9), 85 Stat. 805; Oct. 20, 1972, Pub. L. 92-512, 
title III, Sec. 301(b)-(d), 86 Stat. 946, 947; Oct. 30, 1972, Pub. L. 
92-603, title II, Secs. 299E(d), 299F, 86 Stat. 1462, 1463; Jan. 4, 
1975, Pub. L. 93-647, Secs. 3(a)(3), (4), (e)(2), 5(b), 101(c)(6)(A), 88 
Stat. 2348-2350, 2360; Aug. 9, 1975, Pub. L. 94-88, title II, Sec. 204, 
89 Stat. 435; Nov. 12, 1977, Pub. L. 95-171, Sec. 3(a)(1), 91 Stat. 
1354; Dec. 20, 1977, Pub. L. 95-216, title IV, Secs. 401, 402(a), 91 
Stat. 1559, 1560; June 9, 1980, Pub. L. 96-265, title IV, Secs. 401(g), 
(h), 406(a), 407(c), 94 Stat. 462, 465, 467; Aug. 13, 1981, Pub. L. 97-
35, title XXI, Secs. 2181(a)(1), 2184(b)(1), title XXIII, Secs. 2307(b), 
2315(b), 2317(a), 2319(a)-(c), 2353(b)(1), (d), 95 Stat. 815, 817, 848, 
855-857, 872; Sept. 3, 1982, Pub. L. 97-248, title I, Secs. 154(b), 
156(a)-(c), 157(a), 96 Stat. 397-399; July 18, 1984, Pub. L. 98-369, 
div. B, title VI, Sec. 2663(c)(2), (j)(2)(B)(i), (3)(B)(i), 98 Stat. 
1166, 1170, 1171; Aug. 16, 1984, Pub. L. 98-378, Sec. 9(b), 98 Stat. 
1316; Nov. 6, 1986, Pub. L. 99-603, title I, Sec. 121(b)(1), 100 Stat. 
3390; Dec. 22, 1987, Pub. L. 100-203, title IX, Sec. 9102(c), 101 Stat. 
1330-300; Oct. 13, 1988, Pub. L. 100-485, title II, Secs. 201(c), (d), 
202(b)(4)-(6), 204(b)(2), title III, Secs. 302(b)(2), 304(b)(2), title 
VI, Secs. 601(c)(1), 606, 609(a), 102 Stat. 2372, 2377, 2381, 2384, 
2393, 2407, 2410, 2424; Dec. 19, 1989, Pub. L. 101-239, title VIII, 
Sec. 8004(b), 103 Stat. 2460; Nov. 5, 1990, Pub. L. 101-508, title V, 
Sec. 5081(b), 104 Stat. 1388-235; Aug. 10, 1993, Pub. L. 103-66, title 
XIII, Sec. 13741(a), 107 Stat. 663; July 27, 1995, Pub. L. 104-19, title 
I, 109 Stat. 215; Apr. 26, 1996, Pub. L. 104-134, title III, 110 Stat. 
1321-355; Aug. 22, 1996, Pub. L. 104-193, title I, Sec. 103(c)(2)(B), 
110 Stat. 2161; June 12, 1997, Pub. L. 105-18, title II, 111 Stat. 204, 
related to payments to States with approved plans for aid and services 
to needy families with children, prior to repeal by Pub. L. 104-193, 
Sec. 103(a)(1), as amended by Pub. L. 105-33, title V, Sec. 5514(c), 
Aug. 5, 1997, 111 Stat. 620, effective July 1, 1997.


                               Amendments

    1999--Subsec. (a)(5)(A)(ii)(I)(ff). Pub. L. 106-113, Sec. 1000(a)(4) 
[title VIII, Sec. 805(b)], added item (ff).
    Subsec. (a)(5)(C)(i)(IV). Pub. L. 106-113, Sec. 1000(a)(4) [title 
VIII, Sec. 803], inserted before period at end ``, or if the entity is 
not a private industry council or workforce investment board, the direct 
provision of such services''.
    Subsec. (a)(5)(C)(i)(VII). Pub. L. 106-113, Sec. 1000(a)(4) [title 
VIII, Sec. 802], added subcl. (VII).
    Subsec. (a)(5)(C)(ii). Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, 
Sec. 801(a)], amended heading and text of cl. (ii) generally, 
substituting provisions relating to general eligibility for provisions 
relating to required beneficiaries.
    Subsec. (a)(5)(C)(iii). Pub. L. 106-113, Sec. 1000(a)(4) [title 
VIII, Sec. 801(b)(1)(B)], added cl. (iii). Former cl. (iii) redesignated 
(iv).
    Subsec. (a)(5)(C)(iv). Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, 
Sec. 801(c)], inserted ``hard to employ'' before ``individuals'' in 
heading, substituted ``clauses (ii) and (iii) and, as appropriate, 
clause (v)'' for ``clause (ii)'' before period at end of concluding 
provisions, added subcls. (II) to (IV), and struck out former subcl. 
(II) which read as follows: ``to individuals--
        ``(aa) who are noncustodial parents of minors whose custodial 
    parent is such a recipient; and
        ``(bb) who have such characteristics.''
    Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, Sec. 801(b)(1)(A)], 
redesignated cl. (iii) as (iv). Former cl. (iv) redesignated (v).
    Subsec. (a)(5)(C)(v) to (ix). Pub. L. 106-113, Sec. 1000(a)(4) 
[title VIII, Sec. 801(b)(1)(A)], redesignated cls. (iv) to (viii) as (v) 
to (ix), respectively.
    Subsec. (a)(5)(C)(x). Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, 
Sec. 804(b)], added cl. (x).
    Subsec. (a)(5)(E)(i). Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, 
Sec. 806(c)], substituted ``award'' for ``make'' and inserted ``, but 
shall not make any outlay to pay any such grant before October 1, 2000'' 
before period at end.
    Subsec. (a)(5)(E)(iv)(I)(bb), (vi). Pub. L. 106-113, Sec. 1000(a)(4) 
[title VIII, Sec. 806(a)], substituted ``$50,000,000'' for 
``$100,000,000''.
    Subsec. (a)(5)(F). Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, 
Sec. 806(b)(1)], inserted ``$1,500,000'' before ``of the amount so 
specified for fiscal year 1999''.
    Subsec. (a)(5)(G). Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, 
Sec. 806(b)(2)], inserted ``$900,000'' before ``of the amount so 
specified for fiscal year 1999''.
    Subsec. (a)(5)(H)(i). Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, 
Sec. 806(b)(3)], inserted ``$300,000'' before ``of the amount so 
specified for fiscal year 1999''.
    Subsec. (a)(5)(I)(i). Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, 
Sec. 806(b)(4)], substituted ``for grants under this paragraph--'' and 
subcls. (I) and (II) for ``$1,500,000,000 for each of fiscal years 1998 
and 1999 for grants under this paragraph.''
    Subsec. (a)(5)(K). Pub. L. 106-113, Sec. 1000(a)(4) [title VIII, 
Sec. 805(a)(2)], added subpar. (K).
    1998--Subsec. (a)(5)(A)(iv)(II). Pub. L. 105-306 substituted ``, 
other than funds reserved by the State for distribution under clause 
(vi)(III) and funds distributed pursuant to clause (vi)(I) in any State 
in which the service delivery area is the State'' for ``or sub-State 
entity''.
    Subsec. (a)(5)(A)(vii)(I). Pub. L. 105-277, Sec. 101(f) [title VIII, 
Sec. 405(d)(30)(A)], substituted ``(as described in section 103(c) of 
the Job Training Partnership Act or defined in section 101 of the 
Workforce Investment Act of 1998)'' for ``(as described in section 
103(c) of the Job Training Partnership Act)''.
    Subsec. (a)(5)(A)(ix). Pub. L. 105-277, Sec. 101(f) [title I, 
Sec. 102], added cl. (ix).
    Subsec. (a)(5)(C)(ii). Pub. L. 105-200, Sec. 408(1), struck out ``of 
minors whose custodial parent is such a recipient'' after ``noncustodial 
parents'' in introductory provisions.
    Subsec. (a)(5)(C)(ii)(I). Pub. L. 105-200, Sec. 408(2), inserted 
``or the noncustodial parent'' after ``recipient'' in introductory 
provisions.
    Subsec. (a)(5)(C)(ii)(II). Pub. L. 105-200, Sec. 408(3), substituted 
``The recipient or the minor children of the noncustodial parent--'' for 
``The individual--'' in introductory provisions.
    Subsec. (a)(5)(D)(ii). Pub. L. 105-277, Sec. 101(f) [title VIII, 
Sec. 405(d)(30)(B)(i)], substituted ``means, with respect to a service 
delivery area, the private industry council or local workforce 
investment board established for the service delivery area pursuant to 
the Job Training Partnership Act or title I of the Workforce Investment 
Area of 1998, as appropriate'' for ``means, with respect to a service 
delivery area, the private industry council (or successor entity) 
established for the service delivery area pursuant to the Job Training 
Partnership Act''.
    Subsec. (a)(5)(D)(iii). Pub. L. 105-277, Sec. 101(f) [title VIII, 
Sec. 405(d)(30)(B)(ii)], substituted ``shall have the meaning given such 
term for purposes of the Job Training Partnership Act or shall mean a 
local area as defined in section 101 of the Workforce Investment Act of 
1998, as appropriate'' for ``shall have the meaning given such term (or 
the successor to such term) for purposes of the Job Training Partnership 
Act''.
    1997--Pub. L. 105-33, Sec. 5514(c), made technical amendment to 
directory language of Pub. L. 104-193, Sec. 103(a)(1), which enacted 
this section.
    Subsec. (a)(2). Pub. L. 105-33, Sec. 5502(b)(1), inserted ``ratio'' 
after ``illegitimacy'' in heading.
    Subsec. (a)(2)(A). Pub. L. 105-33, Sec. 5502(b)(2), struck out ``for 
which the State demonstrates a net decrease in out-of-wedlock births'' 
after ``bonus year''.
    Subsec. (a)(2)(B). Pub. L. 105-33, Sec. 5502(a)(1), amended heading 
and text of subpar. (B) generally. Prior to amendment, text read as 
follows:
    ``(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.''
    Subsec. (a)(2)(C)(i)(I)(aa). Pub. L. 105-33, Sec. 5502(b)(3)(A)(i), 
substituted ``illegitimacy ratio of the State for'' for ``number of out-
of-wedlock births that occurred in the State during'' and ``illegitimacy 
ratio of the State for'' for ``number of such births that occurred 
during''.
    Pub. L. 105-33, Sec. 5502(a)(2), inserted at end ``In the case of a 
State that is not a territory specified in subparagraph (B), the 
comparative magnitude of the decrease for the State shall be determined 
without regard to the magnitude of the corresponding decrease for any 
such territory.''
    Subsec. (a)(2)(C)(i)(I)(bb). Pub. L. 105-33, Sec. 5502(c)(1)(A), 
substituted ``the calendar year for which the most recent data are 
available'' for ``the fiscal year'' and ``calendar year 1995'' for 
``fiscal year 1995''.
    Subsec. (a)(2)(C)(i)(II). Pub. L. 105-33, Sec. 5502(c)(1)(B), 
substituted ``calendar'' for ``fiscal'' wherever appearing.
    Subsec. (a)(2)(C)(i)(II)(aa). Pub. L. 105-33, 
Sec. 5502(b)(3)(A)(ii), substituted ``illegitimacy ratio of'' for 
``number of out-of-wedlock births that occurred in'' in two places and 
``calculate the illegitimacy ratio'' for ``calculate the number of out-
of-wedlock births''.
    Subsec. (a)(2)(C)(ii). Pub. L. 105-33, Sec. 5502(c)(2), substituted 
``calendar years'' for ``fiscal years''.
    Subsec. (a)(2)(C)(iii). Pub. L. 105-33, Sec. 5502(b)(3)(B), added 
cl. (iii).
    Subsec. (a)(3)(C)(ii). Pub. L. 105-33, Sec. 5502(d), substituted 
``1998'' for ``1997'' in heading.
    Subsec. (a)(5). Pub. L. 105-33, Sec. 5001(a)(1), added par. (5).
    Subsec. (a)(5)(A)(i)(I), (ii)(II). Pub. L. 105-78 substituted 
``during the period permitted under subparagraph (C)(vii) of this 
paragraph for the expenditure of funds under the grant'' for ``during 
the fiscal year''.
    Subsec. (b)(2). Pub. L. 105-89, Sec. 404(a), inserted ``, reduced by 
the sum of the dollar amounts specified in paragraph (6)(C)(ii)'' before 
period.
    Subsec. (b)(4), (5). Pub. L. 105-33, Sec. 5502(e)(2), redesignated 
pars. (5) and (6) as (4) and (5), respectively, and struck out former 
par. (4) which required each State to remit to the Secretary at the end 
of each fiscal year certain excess amounts paid to the State under par. 
(3) during the fiscal year.
    Subsec. (b)(6). Pub. L. 105-33, Sec. 5502(e)(3), added par. (6).
    Pub. L. 105-33, Sec. 5502(e)(2), redesignated par. (6) as (5).
    Pub. L. 105-33, Sec. 5502(e)(1), substituted ``paragraph (4)'' for 
``paragraph (5)'' in introductory provisions.
    Subsec. (b)(6)(C). Pub. L. 105-89, Sec. 404(b), added subpar. (C).
    Subsec. (b)(7). Pub. L. 105-33, Sec. 5502(f), amended heading and 
text of par. (7) generally. Prior to amendment, text read as follows: 
``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.''
    1996--Subsec. (b)(4)(A)(i)(II). Pub. L. 104-327, Sec. 1(b)(1), 
struck out ``minus any Federal payment with respect to such child care 
expenditures'' after ``for fiscal year 1994''.
    Subsec. (b)(4)(A)(ii)(I). Pub. L. 104-327, Sec. 1(b)(2), inserted 
``the sum of'' before ``the expenditures'' and ``, and any additional 
qualified State expenditures, as defined in section 609(a)(7)(B)(i) of 
this title, for child care assistance made under the Child Care and 
Development Block Grant Act of 1990'' before ``; exceeds''.


                    Effective Date of 1999 Amendment

    Pub. L. 106-113, div. B, Sec. 1000(a)(4) [title VIII, Sec. 801(e)], 
Nov. 29, 1999, 113 Stat. 1535, 1501A-283, provided that: ``The 
amendments made by this section [amending this section and sections 604 
and 612 of this title]--
        ``(1) shall be effective January 1, 2000, with respect to the 
    determination of eligible individuals for purposes of section 
    403(a)(5)(B) of the Social Security Act [subsec. (a)(5)(B) of this 
    section] (relating to competitive grants);
        ``(2) shall be effective July 1, 2000, except that expenditures 
    from allotments to the States shall not be made before October 1, 
    2000--
            ``(A) with respect to the determination of eligible 
        individuals for purposes of section 403(a)(5)(A) of the Social 
        Security Act [subsec. (a)(5)(A) of this section] (relating to 
        formula grants) in the case of those individuals who may be 
        determined to be so eligible, but would not have been eligible 
        before July 1, 2000; or
            ``(B) for allowable activities described in section 
        403(a)(5)(C)(i)(VII) of the Social Security Act [subsec. 
        (a)(5)(C)(i)(VII) of this section] (as added by section 802 of 
        this title) provided to any individuals determined to be 
        eligible for purposes of section 403(a)(5)(A) of the Social 
        Security Act (relating to formula grants).''


                    Effective Date of 1998 Amendments

    Pub. L. 105-306, Sec. 6(b), Oct. 28, 1998, 112 Stat. 2928, provided 
that: ``The amendment made by subsection (a) [amending this section] 
shall take effect as if included in the enactment of section 5001 of the 
Balanced Budget Act of 1997 [Pub. L. 105-33].''
    Amendment by section 101(f) [title VIII, Sec. 405(d)(30)] of Pub. L. 
105-277 effective Oct. 21, 1998, and amendment by section 101(f) [title 
VIII, Sec. 405(f)(22)] of Pub. L. 105-277 effective July 1, 2000, see 
section 101(f) [title VIII, Sec. 405(g)(1), (2)(B)] of Pub. L. 105-277, 
set out as a note under section 3502 of Title 5, Government Organization 
and Employees.


                    Effective Date of 1997 Amendments

    Amendment by Pub. L. 105-89 effective Nov. 19, 1997, except as 
otherwise provided, with delay permitted if State legislation is 
required, see section 501 of Pub. L. 105-89, set out as a note under 
section 622 of this title.
    Amendment by section 5502 of Pub. L. 105-33 effective as if included 
in section 103(a) of the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996, Pub. L. 104-193, at the time such section 
103(a) became law, see section 5518(a) of Pub. L. 105-33, set out as a 
note under section 602 of this title.
    Amendment by section 5514(c) of Pub. L. 105-33 effective as if 
included in the provision of Pub. L. 104-193 amended at the time the 
provision became law, see section 5518(d) of Pub. L. 105-33, set out as 
a note under section 862a of Title 21, Food and Drugs.


                    Effective Date of 1996 Amendment

    Section 1(d) of Pub. L. 104-327 provided that: ``The amendments made 
by this section [amending this section and provisions set out as a note 
under section 601 of this title] shall take effect as if included in the 
provisions of and the amendments made by the Personal Responsibility and 
Work Opportunity Reconciliation Act of 1996 [Pub. L. 104-193].''


                             Effective Date

    Subsec. (a)(1)(C), (D) of this section effective Oct. 1, 1996, and 
remainder of this section effective July 1, 1997, with transition rules 
relating to State options to accelerate such date, rules relating to 
claims, actions, and proceedings commenced before such date, rules 
relating to closing out of accounts for terminated or substantially 
modified programs and continuance in office of Assistant Secretary for 
Family Support, and provisions relating to termination of entitlement 
under AFDC program, see section 116 of Pub. L. 104-193, as amended, set 
out as a note under section 601 of this title.


                               Regulations

    Pub. L. 106-113, div. B, Sec. 1000(a)(4) [title VIII, Sec. 801(f)], 
Nov. 29, 1999, 113 Stat. 1535, 1501A-284, provided that: ``Interim final 
regulations shall be prescribed to implement the amendments made by this 
section [amending this section and sections 604 and 612 of this title] 
not later than January 1, 2000. Final regulations shall be prescribed 
within 90 days after the date of the enactment of this Act [Nov. 29, 
1999] to implement the amendments made by this Act to section 403(a)(5) 
of the Social Security Act [subsec. (a)(5) of this section], in the same 
manner as described in section 403(a)(5)(C)(ix) of the Social Security 
Act (as so redesignated by subsection (b)(1)(A) of this section).''

                  Section Referred to in Other Sections

    This section is referred to in sections 602, 604, 605, 606, 607, 
608, 609, 611, 611a, 612, 613, 615, 618, 654a, 673, 1308 of this title; 
title 7 section 2025; title 29 sections 2841, 2864.
