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TITLE I--IMPROVED INDEPENDENT LIVING PROGRAM

Subtitle A--Improved Independent Living Program

42 USC 677 note.

SEC. 101. IMPROVED INDEPENDENT LIVING PROGRAM.

(a) Findings.--The Congress finds the following:

(1) States are required to make reasonable efforts to find adoptive families for all children, including older children, for whom reunification with their biological family is not in the best interests of the child. However, some older children will continue to live in foster care. These children should be enrolled in an Independent Living program designed and conducted by State and local government to help prepare them for employment, postsecondary education, and successful management of adult responsibilities. (2) Older children who continue to be in foster care as adolescents may become eligible for Independent Living programs. These Independent Living programs are not an alternative to adoption for these children. Enrollment in Independent Living programs can occur concurrent with continued efforts to locate and achieve placement in adoptive families for older children in foster care. (3) About 20,000 adolescents leave the Nation's foster care system each year because they have reached 18 years of age and are expected to support themselves. (4) Congress has received extensive information that adolescents leaving foster care have significant difficulty making a successful transition to adulthood; this information shows that children aging out of foster care show high rates of homelessness, non-marital childbearing, poverty, and delinquent or criminal behavior; they are also frequently the target of crime and physical assaults. (5) The Nation's State and local governments, with financial support from the Federal Government, should offer an extensive program of education, training, employment, and financial support for young adults leaving foster care, with participation in such program beginning several years before high school graduation and continuing, as needed, until the young adults emancipated from foster care establish independence or reach 21 years of age.

''SEC. 477. JOHN H. CHAFEE FOSTER CARE INDEPENDENCE PROGRAM.

''(1) to identify children who are likely to remain in foster care until 18 years of age and to help these children make the transition to self-sufficiency by providing services such as assistance in obtaining a high school diploma, career exploration, vocational training, job placement and retention, training in daily living skills, training in budgeting and financial management skills, substance abuse prevention, and preventive health activities (including smoking avoidance, nutrition education, and pregnancy prevention); ''(2) to help children who are likely to remain in foster care until 18 years of age receive the education, training, and services necessary to obtain employment; ''(3) to help children who are likely to remain in foster care until 18 years of age prepare for and enter postsecondary training and education institutions; ''(4) to provide personal and emotional support to children aging out of foster care, through mentors and the promotion of interactions with dedicated adults; and ''(5) to provide financial, housing, counseling, employment, education, and other appropriate support and services to former foster care recipients between 18 and 21 years of age to complement their own efforts to achieve self-sufficiency and to assure that program participants recognize and accept their personal responsibility for preparing for and then making the transition from adolescence to adulthood.

''(b) Applications.--

''(1) In general.--A State may apply for funds from its allotment under subsection (c) for a period of five consecutive fiscal years by submitting to the Secretary, in writing, a plan that meets the requirements of paragraph (2) and the certifications required by paragraph (3) with respect to the plan. ''(2) State plan.--A plan meets the requirements of this paragraph if the plan specifies which State agency or agencies will administer, supervise, or oversee the programs carried out under the plan, and describes how the State intends to do the following:

''(A) Design and deliver programs to achieve the purposes of this section. ''(B) Ensure that all political subdivisions in the State are served by the program, though not necessarily in a uniform manner. ''(C) Ensure that the programs serve children of various ages and at various stages of achieving independence. ''(D) Involve the public and private sectors in helping adolescents in foster care achieve independence. ''(E) Use objective criteria for determining eligibility for benefits and services under the programs, and for ensuring fair and equitable treatment of benefit recipients. ''(F) Cooperate in national evaluations of the effects of the programs in achieving the purposes of this section.

''(3) Certifications.--The certifications required by this paragraph with respect to a plan are the following:

''(A) A certification by the chief executive officer of the State that the State will provide assistance and services to children who have left foster care because they have attained 18 years of age, and who have not attained 21 years of age. ''(B) A certification by the chief executive officer of the State that not more than 30 percent of the amounts paid to the State from its allotment under subsection (c) for a fiscal year will be expended for room or board for children who have left foster care because they have attained 18 years of age, and who have not attained 21 years of age. ''(C) A certification by the chief executive officer of the State that none of the amounts paid to the State from its allotment under subsection (c) will be expended for room or board for any child who has not attained 18 years of age. ''(D) A certification by the chief executive officer of the State that the State will use training funds provided under the program of Federal payments for foster care and adoption assistance to provide training to help foster parents, adoptive parents, workers in group homes, and case managers understand and address the issues confronting adolescents preparing for independent living, and will, to the extent possible, coordinate such training with the independent living program conducted for adolescents. ''(E) A certification by the chief executive officer of the State that the State has consulted widely with public and private organizations in developing the plan and that the State has given all interested members of the public at least 30 days to submit comments on the plan. ''(F) A certification by the chief executive officer of the State that the State will make every effort to coordinate the State programs receiving funds provided from an allotment made to the State under subsection (c) with other Federal and State programs for youth (especially transitional living youth projects funded under part B of title III of the Juvenile Justice and Delinquency Prevention Act of 1974), abstinence education programs, local housing programs, programs for disabled youth (especially sheltered workshops), and school-to-work programs offered by high schools or local workforce agencies. ''(G) A certification by the chief executive officer of the State that each Indian tribe in the State has been consulted about the programs to be carried out under the plan; that there have been efforts to coordinate the programs with such tribes; and that benefits and services under the programs will be made available to Indian children in the State on the same basis as to other children in the State. ''(H) A certification by the chief executive officer of the State that the State will ensure that adolescents participating in the program under this section participate directly in designing their own program activities that prepare them for independent living and that the adolescents accept personal responsibility for living up to their part of the program. ''(I) A certification by the chief executive officer of the State that the State has established and will enforce standards and procedures to prevent fraud and abuse in the programs carried out under the plan.

''(4) Approval.--The Secretary shall approve an application submitted by a State pursuant to paragraph (1) for a period if--

''(A) the application is submitted on or before June 30 of the calendar year in which such period begins; and ''(B) the Secretary finds that the application contains the material required by paragraph (1).

''(5) Authority to implement certain amendments; notification.--A State with an application approved under paragraph (4) may implement any amendment to the plan contained in the application if the application, incorporating the amendment, would be approvable under paragraph (4).

Deadline.

Within 30 days after a State implements any such amendment, the State shall notify the Secretary of the amendment. ''(6) Availability.--The State shall make available to the public any application submitted by the State pursuant to paragraph (1), and a brief summary of the plan contained in the application.

''(c) Allotments to States.--

''(1) In general.--From the amount specified in subsection (h) that remains after applying subsection (g)(2) for a fiscal year, the Secretary shall allot to each State with an application approved under subsection (b) for the fiscal year the amount which bears the same ratio to such remaining amount as the number of children in foster care under a program of the State in the most recent fiscal year for which such information is available bears to the total number of children in foster care in all States for such most recent fiscal year, as adjusted in accordance with paragraph (2). ''(2) Hold harmless provision.--

''(A) In general.--The Secretary shall allot to each State whose allotment for a fiscal year under paragraph (1) is less than the greater of $500,000 or the amount payable to the State under this section for fiscal year 1998, an additional amount equal to the difference between such allotment and such greater amount. ''(B) Ratable reduction of certain allotments.--In the case of a State not described in subparagraph (A) of this paragraph for a fiscal year, the Secretary shall reduce the amount allotted to the State for the fiscal year under paragraph (1) by the amount that bears the same ratio to the sum of the differences determined under subparagraph (A) of this paragraph for the fiscal year as the excess of the amount so allotted over the greater of $500,000 or the amount payable to the State under this section for fiscal year 1998 bears to the sum of such excess amounts determined for all such States.

''(d) Use of Funds.--

''(1) In general.--A State to which an amount is paid from its allotment under subsection (c) may use the amount in any manner that is reasonably calculated to accomplish the purposes of this section. ''(2) No supplantation of other funds available for same general purposes.--The amounts paid to a State from its allotment under subsection (c) shall be used to supplement and not supplant any other funds which are available for the same general purposes in the State. ''(3) Two-year availability of funds.--Payments made to a State under this section for a fiscal year shall be expended by the State in the fiscal year or in the succeeding fiscal year.

''(e) Penalties.--

''(1) Use of grant in violation of this part.--If the Secretary is made aware, by an audit conducted under chapter 75 of title 31, United States Code, or by any other means, that a program receiving funds from an allotment made to a State under subsection (c) has been operated in a manner that is inconsistent with, or not disclosed in the State application approved under subsection (b), the Secretary shall assess a penalty against the State in an amount equal to not less than 1 percent and not more than 5 percent of the amount of the allotment. ''(2) Failure to comply with data reporting requirement.-- The Secretary shall assess a penalty against a State that fails during a fiscal year to comply with an information collection plan implemented under subsection (f) in an amount equal to not less than 1 percent and not more than 5 percent of the amount allotted to the State for the fiscal year. ''(3) Penalties based on degree of noncompliance.--The Secretary shall assess penalties under this subsection based on the degree of noncompliance.

''(f ) Data Collection and Performance Measurement.--

''(1) In general.--The Secretary, in consultation with State and local public officials responsible for administering independent living and other child welfare programs, child welfare advocates, Members of Congress, youth service providers, and researchers, shall--

''(A) develop outcome measures (including measures of educational attainment, high school diploma, employment, avoidance of dependency, homelessness, nonmarital childbirth, incarceration, and high-risk behaviors) that can be used to assess the performance of States in operating independent living programs; ''(B) identify data elements needed to track--

''(i) the number and characteristics of children receiving services under this section; ''(ii) the type and quantity of services being provided; and ''(iii) State performance on the outcome measures; and

''(C) develop and implement a plan to collect the needed information beginning with the second fiscal year beginning after the date of the enactment of this section.

Deadline.

''(2) Report to the congress.--Within 12 months after the date of the enactment of this section, the Secretary shall submit to the Committee on Ways and Means of the House of Representatives and the Committee on Finance of the Senate a report detailing the plans and timetable for collecting from the States the information described in paragraph (1) and a proposal to impose penalties consistent with paragraph (e)(2) on States that do not report data.

''(g) Evaluations.--

''(1) In general.--The Secretary shall conduct evaluations of such State programs funded under this section as the Secretary deems to be innovative or of potential national significance. The evaluation of any such program shall include information on the effects of the program on education, employment, and personal development. To the maximum extent practicable, the evaluations shall be based on rigorous scientific standards including random assignment to treatment and control groups. The Secretary is encouraged to work directly with State and local governments to design methods for conducting the evaluations, directly or by grant, contract, or cooperative agreement. ''(2) Funding of evaluations.--The Secretary shall reserve 1.5 percent of the amount specified in subsection (h) for a fiscal year to carry out, during the fiscal year, evaluation, technical assistance, performance measurement, and data collection activities related to this section, directly or through grants, contracts, or cooperative agreements with appropriate entities.

''(h) Limitations on Authorization of Appropriations.--To carry out this section and for payments to States under section 474(a)(4), there are authorized to be appropriated to the Secretary $140,000,000 for each fiscal year.''. (c) Payments to States.--Section 474(a)(4) of such Act (42 U.S.C. 674(a)(4)) is amended to read as follows:

''(4) the lesser of--

''(A) 80 percent of the amount (if any) by which--

''(i) the total amount expended by the State during the fiscal year in which the quarter occurs to carry out programs in accordance with the State application approved under section 477(b) for the period in which the quarter occurs (including any amendment that meets the requirements of section 477(b)(5)); exceeds ''(ii) the total amount of any penalties assessed against the State under section 477(e) during the fiscal year in which the quarter occurs; or

''(B) the amount allotted to the State under section 477 for the fiscal year in which the quarter occurs, reduced by the total of the amounts payable to the State under this paragraph for all prior quarters in the fiscal year.''.

(d) Regulations.--Not later than 12 months after the date of the enactment of this Act, the Secretary of Health and Human Services shall issue such regulations as may be necessary to carry out the amendments made by this section.

Deadline. 42 USC 677 note.

(e) Sense of the Congress.--It is the sense of the Congress that States should provide medical assistance under the State plan approved under title XIX of the Social Security Act to 18-, 19-, and 20-year-olds who have been emancipated from foster care.

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Subtitle B--Related Foster Care Provision

SEC. 111. INCREASE IN AMOUNT OF ASSETS ALLOWABLE FOR CHILDREN IN FOSTER CARE.

Section 472(a) of the Social Security Act (42 U.S.C. 672(a)) is amended by adding at the end the following: ''In determining whether a child would have received aid under a State plan approved under section 402 (as in effect on July 16, 1996), a child whose resources (determined pursuant to section 402(a)(7)(B), as so in effect) have a combined value of not more than $10,000 shall be considered to be a child whose resources have a combined value of not more than $1,000 (or such lower amount as the State may determine for purposes of such section 402(a)(7)(B)).''.

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SEC. 112. PREPARATION OF FOSTER PARENTS TO PROVIDE FOR THE NEEDS OF CHILDREN IN STATE CARE.

(a) State Plan Requirement.--Section 471(a) of the Social Security Act (42 U.S.C. 671(a)) is amended--

(1) by striking ''and'' at the end of paragraph (22); (2) by striking the period at the end of paragraph (23) and inserting ''; and''; and (3) by adding at the end the following: ''(24) include a certification that, before a child in foster care under the responsibility of the State is placed with prospective foster parents, the prospective foster parents will be prepared adequately with the appropriate knowledge and skills to provide for the needs of the child, and that such preparation will be continued, as necessary, after the placement of the child.''.

42 USC 671 note.

(b) Effective Date.--The amendments made by subsection (a) shall take effect on October 1, 1999.

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Subtitle C--Medicaid Amendments

SEC. 121. STATE OPTION OF MEDICAID COVERAGE FOR ADOLESCENTS LEAVING FOSTER CARE.

(a) In General.--Subject to subsection (c), title XIX of the Social Security Act, is amended--

(1) in section 1902(a)(10)(A)(ii) (42 U.S.C. 1396a(a)(10)(A)(ii))--

(A) by striking ''or'' at the end of subclause (XIII); (B) by adding ''or'' at the end of subclause (XIV); and (C) by adding at the end the following new subclause: ''(XV) who are independent foster care adolescents (as defined in section 1905(v)(1)), or who are within any reasonable categories of such adolescents specified by the State;''; and

(2) by adding at the end of section 1905 (42 U.S.C. 1396d) the following new subsection:       ''(v)(1) For purposes of this title, the term 'independent foster care adolescent' means an individual--

''(A) who is under 21 years of age; ''(B) who, on the individual's 18th birthday, was in foster care under the responsibility of a State; and ''(C) whose assets, resources, and income do not exceed such levels (if any) as the State may establish consistent with paragraph (2).

      ''(2) The levels established by a State under paragraph (1)(C) may not be less than the corresponding levels applied by the State under section 1931(b).       ''(3) A State may limit the eligibility of independent foster care adolescents under section 1902(a)(10)(A)(ii)(XV) to those individuals with respect to whom foster care maintenance payments or independent living services were furnished under a program funded under part E of title IV before the date the individuals attained 18 years of age.''.

Applicability. 42 USC 1396a note.

(b) Effective Date.--The amendments made by subsection (a) apply to medical assistance for items and services furnished on or after October 1, 1999.

42 USC 1396a note.

(c) Contingency in Enactment.--If the Ticket to Work and Work Incentives Improvement Act of 1999 is enacted (whether before, on, or after the date of the enactment of this Act)--

(1) the amendments made by that Act shall be executed as if this Act had been enacted after the enactment of such other Act; (2) with respect to subsection (a)(1)(A) of this section, any reference to subclause (XIII) is deemed a reference to subclause (XV); (3) with respect to subsection (a)(1)(B) of this section, any reference to subclause (XIV) is deemed a reference to subclause (XVI);

42 USC 1396a.

(4) the subclause (XV) added by subsection (a)(1)(C) of this section--

(A) is redesignated as subclause (XVII); and (B) is amended by striking ''section 1905(v)(1)'' and inserting ''section 1905(w)(1)''; and

42 USC 1396d.

(5) the subsection (v) added by subsection (a)(2) of this section--

(A) is redesignated as subsection (w); and (B) is amended by striking ''1902(a)(10)(A)(ii)(XV)'' and inserting ''1902(a)(10)(A)(ii)(XVII)''.

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Subtitle D--Adoption Incentive Payments

SEC. 131. INCREASED FUNDING FOR ADOPTION INCENTIVE PAYMENTS.

(a) Supplemental Grants.--Section 473A of the Social Security Act (42 U.S.C. 673b) is amended by adding at the end the following: ''( j) Supplemental Grants.--

''(1) In general.--Subject to the availability of such amounts as may be provided in advance in appropriations Acts, in addition to any amount otherwise payable under this section to any State that is an incentive-eligible State for fiscal year 1998, the Secretary shall make a grant to the State in an amount equal to the lesser of--

''(A) the amount by which--

''(i) the amount that would have been payable to the State under this section during fiscal year 1999 (on the basis of adoptions in fiscal year 1998) in the absence of subsection (d)(2) if sufficient funds had been available for the payment; exceeds ''(ii) the amount that, before the enactment of this subsection, was payable to the State under this section during fiscal year 1999 (on such basis); or

''(B) the amount that bears the same ratio to the dollar amount specified in paragraph (2) as the amount described by subparagraph (A) for the State bears to the aggregate of the amounts described by subparagraph (A) for all States that are incentive-eligible States for fiscal year 1998.

''(2) Funding.--$23,000,000 of the amounts appropriated under subsection (h)(1) for fiscal year 2000 may be used for grants under paragraph (1) of this subsection.''.

(b) Limitation on Authorization of Appropriations.--Section 473A(h)(1) of the Social Security Act (42 U.S.C. 673b(h)(1)) is amended to read as follows:

''(1) In general.--For grants under subsection (a), there are authorized to be appropriated to the Secretary--

''(A) $20,000,000 for fiscal year 1999; ''(B) $43,000,000 for fiscal year 2000; and ''(C) $20,000,000 for each of fiscal years 2001 through 2003.''.

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