H. Rept. 112-677, Part 1 - 112th Congress (2011-2012)

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House Report 112-677 - PROVIDING FOR CONGRESSIONAL DISAPPROVAL UNDER CHAPTER 8 OF TITLE 5, UNITED STATES CODE, OF THE RULE SUBMITTED BY THE OFFICE OF FAMILY ASSISTANCE OF THE ADMINISTRATION FOR CHILDREN AND FAMILIES OF THE DEPARTMENT OF HEALTH AND HUMAN SERVICES RELATING TO WAIVER AND EXPENDITURE AUTHORITY UNDER SECTION 1115 OF THE SOCIAL SECURITY ACT (42 U.S.C. 1315) WITH RESPECT TO THE TEMPORARY ASSISTANCE FOR NEEDY FAMILIES PROGRAM

[House Report 112-677]
[From the U.S. Government Publishing Office]


112th Congress                                            Rept. 112-677
                        HOUSE OF REPRESENTATIVES
 2d Session                                                      Part 1

======================================================================

 
  PROVIDING FOR CONGRESSIONAL DISAPPROVAL UNDER CHAPTER 8 OF TITLE 5, 
   UNITED STATES CODE, OF THE RULE SUBMITTED BY THE OFFICE OF FAMILY 
   ASSISTANCE OF THE ADMINISTRATION FOR CHILDREN AND FAMILIES OF THE 
    DEPARTMENT OF HEALTH AND HUMAN SERVICES RELATING TO WAIVER AND 
EXPENDITURE AUTHORITY UNDER SECTION 1115 OF THE SOCIAL SECURITY ACT (42 
    U.S.C. 1315) WITH RESPECT TO THE TEMPORARY ASSISTANCE FOR NEEDY 
                            FAMILIES PROGRAM

                                _______
                                

 September 18, 2012.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

Mr. Camp, from the Committee on Ways and Means, submitted the following

                              R E P O R T

                             together with

                            DISSENTING VIEWS

                      [To accompany H.J. Res. 118]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
joint resolution (H.J. Res. 118) providing for congressional 
disapproval under chapter 8 of title 5, United States Code, of 
the rule submitted by the Office of Family Assistance of the 
Administration for Children and Families of the Department of 
Health and Human Services relating to waiver and expenditure 
authority under section 1115 of the Social Security Act (42 
U.S.C. 1315) with respect to the Temporary Assistance for Needy 
Families program, having considered the same, report favorably 
thereon without amendment and recommend that the joint 
resolution do pass.

                       I. SUMMARY AND BACKGROUND

A. Purpose and Summary

    The resolution, H.J. Res. 118, as ordered reported by the 
Committee on Ways and Means on September 13, 2012, expresses 
disapproval of the July 12, 2012 Department of Health and Human 
Services (HHS) rule\1\ proposing to allow States to waive work 
requirements for welfare recipients under the Temporary 
Assistance for Needy Families (TANF) program. To achieve these 
purposes, the resolution states that Congress disapproves of 
the HHS rule and that it ``shall have no force or effect.''
---------------------------------------------------------------------------
    \1\HHS, TANF Information Memorandum, Transmittal No. TANF-ACT-IM-
2012-03, July 12, 2012, available online at http://www.acf.hhs.gov/
programs/ofa/policy/im-ofa/2012/im201203/im201203.html.
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B. Background and Need for Legislation

    On September 11, 2012, Rep. David Camp (R-MI), Chairman of 
the Committee on Ways and Means and Rep. John Kline (R-MN), 
Chairman of the Committee on Education and the Workforce, along 
with Rep. Jim Jordan (R-OH) introduced H.J. Res. 118, a 
resolution to express Congress' disapproval of the July 12, 
2012 HHS rule proposing to allow States to waive the welfare 
work requirement.
    Bipartisan, work-based welfare reform in the 1990s led to 
increased work and earnings, along with record declines in 
poverty and dependence on government cash welfare benefits 
among low-income families. The reforms ended waiver authority 
granted under the prior Aid to Families with Dependent Children 
(AFDC) program and instead offered States new flexibility in 
designing welfare programs in exchange for fixed federal funds 
and a requirement that welfare recipients engage in work and 
related activities. Despite this, the Administration claims in 
their July 12, 2012 HHS rule that they still possess the waiver 
authority available under the prior AFDC law, despite 
substantial changes to the Social Security Act made in the 1996 
welfare reform law (P.L. 104-193, officially titled the 
``Personal Responsibility and Work Opportunity Reconciliation 
Act'') that both limited States' waiver authority and created 
real work requirements.
    The Administration rule would have the effect of allowing 
States to opt out of TANF work requirements for the first time 
since welfare reform's passage in 1996. This is despite the 
fact that current TANF law allows State waivers only related to 
State plan reporting requirements (which are a paperwork 
requirement authorized in Section 402 of the Social Security 
Act) and does not provide authority for the Administration to 
grant waivers related to the critical TANF work requirements in 
section 407 of the Social Security Act.
    Supporting the view that HHS does not have the authority to 
waive TANF work requirements is TANF history, precedent, and 
even the Administration's own arguments about recent 
legislative activity involving TANF work requirements.
    In passing the 1996 welfare reform law to end AFDC and 
create TANF, Congress redesigned every section of the prior 
AFDC program. Provisions applying to the earlier AFDC program 
were eliminated, new requirements were added, and specific 
restrictions were put in place to create a program of fixed 
funding to States with strong work requirements. One 
fundamental change to the TANF law was a restructuring of 
section 402, which previously had specified 45 mandatory 
requirements States had to implement subject to review and 
approval by HHS. Section 402 was fundamentally redesigned 
through welfare reform to specify only 7 mandatory reporting 
requirements that States must outline in a written report, and 
over which HHS had only the authority to review the plan for 
completeness instead of approving specific State policies as 
under the prior AFDC law.
    Congress also created a section titled ``waivers'' within 
Title IV in section 415 of the Social Security Act to explain 
how waivers would function under TANF. One provision allowed 
temporary waiver programs in effect prior to the enactment of 
welfare reform to continue until their natural expiration date. 
A second provision allowed for waivers submitted before August 
22, 1996 and approved by the Secretary of HHS by July 1, 1997 
to begin, but expressly prohibited such waivers from having any 
effect on the new TANF work requirements. Section 415 did not 
contemplate waivers after the AFDC program ended, which 
occurred no later than July 1, 1997.
    Driving home this point is the clear intention of the 
Committee on Ways and Means in 1996 regarding the question of 
whether TANF work requirements may be waived. Shortly after 
Congress approved the historic 1996 welfare reform law, the 
Ways and Means Committee issued a ``Committee Print'' in 
November 1996 summarizing the legislation (titled ``Summary of 
the Welfare Reforms Made by Public Law 104-193: The Personal 
Responsibility and Work Opportunity Reconciliation Act and 
Associated Legislation, WMCP 104-15). In the section describing 
waivers under the new law, the summary\2\ said ``Waivers 
granted after the date of enactment may not override provisions 
of the TANF law that concern mandatory work requirements.''
---------------------------------------------------------------------------
    \2\Ways and Means Committee Print, Summary of Welfare Reforms Made 
By Public Law 
104-93, available online at http://www.gpo.gov/fdsys/pkg/CPRT-
104WPRT27305/pdf/CPRT-104WPRT27305.pdf.
---------------------------------------------------------------------------
    Further, after the passage of welfare reform and as 
required as part of the law, HHS issued regulations describing 
how certain provisions of TANF would be implemented. One 
section of these final 1999 HHS regulations\3\ detailed how 
waivers granted under the prior AFDC program would continue to 
operate, and what States must do to continue their waivers 
until their expiration date. The HHS rule said States with 
waivers to test work requirements under the prior AFDC program 
``may delay implementing TANF requirements for work 
participation'' but that ``because all States will need to 
conform to all TANF rules once their waivers expire, we urge 
States to plan accordingly.'' This final rule does not discuss 
future waivers, and by indicating that all States would 
eventually have to implement TANF work requirements, it is 
clear that HHS agreed that there existed no authority to waive 
work requirements in the future.
---------------------------------------------------------------------------
    \3\Federal Register, Vol. 64, No. 69, April 12, 1999, Rules and 
Regulations, HHS, Administration for Children and Families (ACF), TANF 
Final Rule, available online at http://www.gpo.gov/fdsys/pkg/FR-1999-
04-12/pdf/99-8000.pdf.
---------------------------------------------------------------------------
    In the years following this 1999 determination, HHS 
continued to state in official documents that the agency could 
not waive TANF work requirements. For example, in the immediate 
aftermath of Hurricane Katrina in 2005, States contacted HHS to 
determine what flexibility may be available to them because of 
the disaster. In the official HHS guidance issued in 
response,\4\ HHS cited a number of things States could do to 
assist those affected by the hurricane given the substantial 
flexibility in the TANF law. However, the guidance was 
unequivocal regarding HHS' waiver authority, stating ``we have 
no authority under current law to waive any of the TANF 
statutory requirements'' and ``we have no authority to waive 
any of the provisions in the Act.'' Additional official HHS 
guidance regarding disasters was issued in 2007,\5\ which 
repeated word for word the same statements about waiver 
authority made in the 2005 HHS guidance.
---------------------------------------------------------------------------
    \4\HHS, TANF Program Instruction, No. TANF-ACF-PI-2005-06, October 
11, 2005, available online at http://www.acf.hhs.gov/programs/ofa/
policy/pi-ofa/2005/pi2005-6.htm.
    \5\HHS, TANF Program Instruction, No. TANF-ACF-PI-2007-08, November 
28, 2007, available online at http://www.acf.hhs.gov/programs/ofa/
policy/pi-ofa/2007/200708/PI200708.htm.
---------------------------------------------------------------------------
    After 16 years of welfare policy and practice to the 
contrary, the Obama Administration in July 2012 announced that 
for the first time in the history of the TANF program the 
agency now claimed to have authority to waive work requirements 
for welfare recipients. Importantly, the Administration's July 
12 rule was not the result of any new legislation passed by 
Congress, nor connected to any TANF proposal submitted in a 
prior Administration budget document. No prior HHS Secretary, 
Republican or Democrat, has ever concluded that he or she had 
the authority to the TANF waive work requirements.
    In her July 18, 2012 response\6\ to a letter from Chairman 
Camp and Senate Finance Committee Ranking Member Hatch (R-UT) 
seeking the Administration rationale for its July 12 
announcement, HHS Secretary Sebelius confirms the view that in 
earlier years State governors also believed that Federal law 
would need to be changed to create waiver authority: ``For 
years, Republican and Democratic Governors have requested more 
flexibility in implementing welfare reform. . . . In 2005, 29 
Republican Governors requested (i)ncreased waiver authority, 
allowable work activities, availability of partial work credit' 
. . .'' This contention, and the fact TANF law was not changed 
in 2005 or subsequent years to allow for waivers of work 
requirements, simply reinforces the point that current law does 
not allow for waivers of welfare work requirements, and that 
Congress must change the law for such waiver authority to 
exist.
---------------------------------------------------------------------------
    \6\Letter from HHS Secretary Kathleen Sebelius to Ways and Means 
Committee Chairman Dave Camp, July 12, 2012, available online at http:/
/waysandmeans.house.gov/uploadedfiles/hhs_response_7-18-12.pdf.
---------------------------------------------------------------------------
    The Administration has also attempted to justify their 
claim of waiver authority by stating that they will approve 
only waivers that result in more welfare recipients entering 
the workforce. Specifically, the Administration stated that 
waivers will be approved only if they ``move at least 20% more 
people from welfare to work compared with the state's past 
performance.'' However, this ``20% more'' policy did not appear 
in the initial July 12, 2012 Information Memorandum to States, 
only appearing after Congress objected to HHS' waiving of the 
work requirements. In addition, this ``20% more'' policy is not 
contained in any rule or guidance, but instead only in a letter 
to Congress, which does not appear to be of any force. While 
public statements by Administration officials suggest that they 
will approve only waivers resulting in more work, no binding 
policy--or real details--exists to support these claims.
    For these reasons, the Committee believes H.J. Res 118 is 
needed to ensure that TANF work requirements are not waived in 
whole or in part and that Congressional intent regarding the 
mandatory nature of welfare work requirements remains in force.

C. Legislative History

            Background
    H.J. Res. 118 was introduced on September 11, 2012, and was 
referred to the Committee on Ways and Means, in addition to the 
Committee on Education and the Workforce.
            Committee Action
    The Committee on Ways and Means marked up the resolution on 
September 13, 2012, and ordered the resolution favorably 
reported. The Committee on Education and the Workforce also 
marked up the resolution on September 13, 2012, and ordered the 
resolution favorably reported.
            Committee Hearings
    None specifically on H.J. Res. 118. On May 17, 2012, the 
Subcommittee on Human Resources held a hearing on State TANF 
Spending and Its Impact on Work Requirements.

                   II. EXPLANATION OF THE RESOLUTION

Present Law

    The Public Welfare Amendments of 1962 (P.L. 87-543) 
established waiver authority within Section 1115 of the Social 
Security Act for public assistance programs, including the AFDC 
program that preceded TANF in helping fund cash assistance for 
needy families with children.
    Though waivers under Section 1115 were allowed as early as 
1962, they were not sought with much frequency until the late 
1980s. Until that point, waivers were primarily related to 
program administration and service delivery. Between 1987 and 
1989, during the Reagan Administration, 15 waiver applications 
for welfare reform were approved for 14 states; during the 
Administration of George H.W. Bush, another 15 applications 
from 12 states were approved. Until the enactment of the 1996 
welfare law, the Clinton Administration continued to approve 
waivers of AFDC law. Between January 1993 and August 1996, a 
total of 83 waiver applications from 43 states and the District 
of Columbia were approved.
    The 1996 welfare reform law (P.L. 104-193) replaced the 
prior AFDC program with the new TANF block grant. At the same 
time, the statute was reorganized and a new section 407 was 
added, titled ``Mandatory Work Requirements.'' Section 402, 
which today is the only section of TANF listed under the waiver 
``demonstration projects'' authority in section 1115 of the 
Social Security Act, is titled ``Eligible States; State Plan.'' 
Section 402 generally defines the ``written document'' that 
States must submit to the Secretary of HHS each year describing 
how the State intends to achieve various TANF program purposes, 
among other purposes. As a result of these and other changes, 
present law does not provide for waivers of TANF work 
requirements. The Obama Administration's July 12, 2012 
information memorandum claiming authority to waive work 
requirements would be the first time HHS has claimed to have 
such waiver authority since TANF was created in 1996, and if 
allowed to stand would permit HHS to circumvent statutory work 
requirements in section 407 of the law.

Reasons for Change

    The Committee believes it is necessary to ensure the 
continuation and proper functioning of the work requirements 
that are the heart of the nation's successful efforts at 
promoting work for welfare recipients. Accordingly, H.J. Res. 
118 disapproves of the Administration's July 12, 2012 rule 
waiving the work requirements, declaring that ``such rule shall 
have no force or effect.''
    On July 31, 2012, Chairman Camp and Senate Finance Ranking 
Member Hatch (R-UT) asked the Government Accountability Office 
(GAO) to review the HHS Information Memorandum announcing 
waivers of work requirements to determine if it was a rule that 
should have been submitted officially to Congress before taking 
effect.\7\ On September 4, 2012, GAO reported to Congress that 
the HHS guidance was in fact a rule that must be submitted to 
Congress and that it is subject to review--and disapproval--
under the Congressional Review Act.\8\
---------------------------------------------------------------------------
    \7\Letter from Rep. Dave Camp and Sen. Orrin Hatch to Comptroller 
Gene Dorado at GAO, July 31, 2012, available online at http://
waysandmeans.house.gov/uploadedfiles/gao_tanf_ waivers_letter.pdf.
    \8\Letter from GAO Comptroller General Gene Dorado to Rep. Dave 
Camp and Sen. Orrin Hatch, September 4, 2012, available online at 
http://waysandmeans.house.gov/news/
documentsingle.aspx?DocumentID=307447.
---------------------------------------------------------------------------
    A significant body of evidence suggests that the work 
requirements included in the 1996 welfare reform law have been 
essential to improvements in work, earnings, poverty and 
welfare dependence in the wake of that legislation. 
Specifically, since the work-based 1996 welfare reforms were 
enacted: (1) The employment of single mothers increased by 15 
percent from 1996 through 2000, and even after the recession it 
is still higher than before welfare reform;\9\ (2) According to 
HHS' latest report on the TANF program, ``earnings in female-
headed families remained higher in 2009 than in 1996 despite 
various shifts in the economic climate since TANF's 
enactment'';\10\ (3) Since it replaced the New Deal-era AFDC 
program in 1996, TANF has been successful at cutting welfare 
dependence as caseloads have declined by 57 percent through 
December 2011;\11\ and (4) Child poverty fell dramatically 
after welfare reform and is still below the level in the early 
1990s.\12\
---------------------------------------------------------------------------
    \9\Congressional Research Service estimates based on Census Bureau 
data prepared for Ways and Means staff.
    \10\HHS, TANF Program, Ninth Report to Congress, 2012, available 
online at http://www.acf.hhs.gov/programs/ofa/data-reports/
annualreport9/9th_report-to-congress_3-26-12.pdf.
    \11\HHS, ACF, 2011 TANF Caseload Data, available online at http://
www.acf.hhs.gov/programs/ofa/data-reports/caseload/
caseload_current.htm.
    \12\U.S. Bureau of the Census, Current Population Survey, Annual 
Social and Economic Supplements, Table 3, Poverty Status of People, by 
Age, Race, And Hispanic Origin: 1959 to 2011, available online at 
http://www.census.gov/hhes/www/poverty/data/historical/hstpov3.xls.
---------------------------------------------------------------------------
    These reforms received bipartisan support from Republicans 
and Democrats and were signed into law by President Clinton. 
The fact that the Administration has now sought to waive the 
TANF work requirements belies past bipartisan support for 
requiring work by welfare recipients, including from the 
following senior Democrats:
     ``I proposed a concept of welfare to work in 1987, 
and I was pilloried by my colleagues on the Democratic side at 
the time for suggesting that there be a mandatory work 
requirement for anyone receiving welfare.'' (Then-Senator Joe 
Biden,\13\ July 18, 1996)
---------------------------------------------------------------------------
    \13\U.S. Congressional Record, 104th Congress, Vol. 142, No. 106, 
July 18, 1996, available online at http://www.gpo.gov/fdsys/pkg/CREC-
1996-07-18/pdf/CREC-1996-07-18-senate.pdf.
---------------------------------------------------------------------------
     ``In order for welfare reform to be successful, 
individuals must accept the responsibility of working and 
providing for their families. In the instances where benefits 
are provided, they must be tied to obligations. We must invest 
our resources on those who value work and responsibility. 
Moreover, we must support strict requirements which move people 
from dependence to independence. Granting rights without 
demanding responsibility is unacceptable.'' (Current House 
Democrat Whip Steny Hoyer,\14\ July 31, 1996)
---------------------------------------------------------------------------
    \14\U.S. Congressional Record, 104th Congress, Vol. 142, No. 115, 
July 31, 1996, available online at http://www.gpo.gov/fdsys/pkg/CREC-
1996-07-31/pdf/CREC-1996-07-31-house.pdf.
---------------------------------------------------------------------------
     ``Everyone agrees if you are able to work, you 
should be working. Every taxpayer should be angry and annoyed 
to find people slipping back on their responsibilities and not 
working.'' (Congressman Charlie Rangel,\15\ July 31, 1996)
---------------------------------------------------------------------------
    \15\U.S. Congressional Record, 104th Congress, Vol. 142, No. 115, 
July 31, 1996, available online at http://www.gpo.gov/fdsys/pkg/CREC-
1996-07-31/pdf/CREC-1996-07-31-house.pdf.
---------------------------------------------------------------------------
     ``The key always has been the linkage of welfare 
to work, within a definite time structure . .  '' (Congressman 
Sander Levin,\16\ July 31, 1996)
---------------------------------------------------------------------------
    \16\U.S. Congressional Record, 104th Congress, Vol. 142, No. 115, 
July 31, 1996, available online at http://www.gpo.gov/fdsys/pkg/CREC-
1996-07-31/pdf/CREC-1996-07-31-house.pdf.
---------------------------------------------------------------------------
    As a result, the Committee believes that disapproving the 
Administration's rule waiving welfare work requirements is 
appropriate and that it will ensure the continuation of 
effective work requirements for adults collecting welfare 
benefits under the TANF program. Ultimately, this will promote 
more work, higher incomes, lower poverty, and more departures 
from welfare for independence and self-support, which are among 
the most important of the TANF program's goals.

Explanation of Provision

    The provision states that Congress disapproves the 
Administration's July 12, 2012 rule waiving TANF work 
requirements and that ``such rule shall have no force or 
effect.''

Effective Date

    The provision becomes effective upon enactment.

                      III. VOTES OF THE COMMITTEE

    In compliance with clause 3(b) of rule XIII of the Rules of 
the House of Representatives, the following statements are made 
concerning the votes of the Committee on Ways and Means in its 
consideration of the resolution, H.J. Res. 118.
    The resolution, ``H.J. Res. 118, providing for 
congressional disapproval of the Administration's July 12, 2012 
waiver of welfare work requirements,'' was ordered favorably 
reported without amendment to the House of Representatives by a 
rollcall vote of 18 yeas to 14 nays (with a quorum being 
present). The vote was as follows:

----------------------------------------------------------------------------------------------------------------
         Representative             Yea       Nay     Present     Representative      Yea       Nay     Present
----------------------------------------------------------------------------------------------------------------
Mr. Camp.......................        X   ........  .........  Mr. Levin........  ........        X   .........
Mr. Herger.....................  ........  ........  .........  Mr. Rangel.......  ........        X   .........
Mr. Johnson....................        X   ........  .........  Mr. Stark........  ........        X   .........
Mr. Brady......................        X   ........  .........  Mr. McDermott....  ........        X   .........
Mr. Ryan.......................  ........  ........  .........  Mr. Lewis........  ........  ........  .........
Mr. Nunes......................        X   ........  .........  Mr. Neal.........  ........        X   .........
Mr. Tiberi.....................        X   ........  .........  Mr. Becerra......  ........        X   .........
Mr. Reichert...................        X   ........  .........  Mr. Doggett......  ........        X   .........
Mr. Boustany...................        X   ........  .........  Mr. Thompson.....  ........        X   .........
Mr. Roskam.....................        X   ........  .........  Mr. Larson.......  ........        X   .........
Mr. Gerlach....................        X   ........  .........  Mr. Blumenauer...  ........        X   .........
Mr. Price......................        X   ........  .........  Mr. Kind.........  ........        X   .........
Mr. Buchanan...................        X   ........  .........  Mr. Pascrell.....  ........        X   .........
Mr. Smith......................        X   ........  .........  Ms. Berkley......  ........        X   .........
Mr. Schock.....................        X   ........  .........  Mr. Crowley......  ........        X   .........
Ms. Jenkins....................        X   ........  .........
Mr. Paulsen....................        X   ........  .........
Mr. Marchant...................        X   ........  .........
Mr. Berg.......................  ........  ........  .........
Ms. Black......................        X   ........  .........
Mr. Reed.......................        X   ........  .........
----------------------------------------------------------------------------------------------------------------

Votes on Amendments

    No amendments to the resolution were offered.

                  IV. BUDGET EFFECTS OF THE RESOLUTION

A. Committee Estimate of Budgetary Effects

    In compliance with clause 3(d) of rule XIII of the Rules of 
the House of Representatives, the following statement is made 
concerning the effects on the budget of the revenue provisions 
of the resolution, H.J. Res. 118 as reported: The Committee 
agrees with the estimates prepared by the Congressional Budget 
Office (CBO), which are included below.
            Statement regarding new budget authority and tax 
                    expenditures budget authority
    The resolution as reported is in compliance with clause 
3(c)(2) of rule XIII of the Rules of the House of 
Representatives. Further, the resolution involves no new or 
increased tax expenditures.

B. Cost Estimate Prepared by the Congressional Budget Office

    In compliance with clause 3(c)(3) of rule XIII of the Rules 
of the House of Representatives, requiring a cost estimate 
prepared by the CBO, the following statement by CBO is 
provided.

                                     U.S. Congress,
                               Congressional Budget Office,
                                Washington, DC, September 17, 2012.
Hon. Dave Camp,
Chairman, Committee on Ways and Means,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.J. Res. 118, a joint 
resolution providing for congressional disapproval under 
chapter 8 of title 5, United States Code, of the rule submitted 
by the Office of Family Assistance of the Administration for 
Children and Families of the Department of Health and Human 
Services relating to waiver and expenditure authority under 
section 1115 of the Social Security Act (42 U.S.C. 1315) with 
respect to the Temporary Assistance for Needy Families program.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Jonathan 
Morancy.
            Sincerely,
                                      Douglas W. Elmendorf,
                                                          Director.
    Enclosure.

H.J. Res. 118--A joint resolution providing for congressional 
        disapproval under chapter 8 of title 5, United States Code, of 
        the rule submitted by the Office of Family Assistance of the 
        Administration for Children and Families of the Department of 
        Health and Human Services relating to waiver and expenditure 
        authority under section 1115 of the Social Security Act (42 
        U.S.C. 1315) with respect to the Temporary Assistance for Needy 
        Families program

    Summary: H.J. Res. 118 would disapprove the rule submitted 
by the Department of Health and Human Services (HHS) on July 
12, 2012, that modifies the waiver authority with respect to 
work requirements in the Temporary Assistance for Needy 
Families program (TANF). H.J. Res. 118 would invoke a 
legislative process established by the Congressional Review Act 
(Public Law 104-121) to disapprove the new waiver authority 
rule. If H.J. Res. 118 is enacted, the rule would have no force 
or effect.
    CBO estimates that enacting the resolution would reduce 
direct spending by $59 million over the 2013-2022 period. (The 
resolution would not affect revenues.) Pay-as-you-go procedures 
apply because enacting the legislation would affect direct 
spending.
    CBO does not expect that implementing the resolution would 
have any significant effect on spending subject to 
appropriation.
    The joint resolution contains no intergovernmental or 
private-sector mandates as defined in the Unfunded Mandates 
Reform Act (UMRA).
    Estimated cost to the Federal Government: The estimated 
budgetary impact of House Joint Resolution 118 is shown in the 
following table. The costs of this legislation fall within 
budget function 600 (income security).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                        By fiscal year, in millions of dollars
                                                             -------------------------------------------------------------------------------------------
                                                               2013   2014   2015   2016   2017   2018   2019   2020   2021   2022  2013-2017  2013-2022
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               CHANGES IN DIRECT SPENDING

Estimated Budget Authority..................................     -5     -6     -6     -6     -6     -6     -6     -7     -7     -7       -28        -59
Estimated Outlays...........................................     -5     -6     -6     -6     -6     -6     -6     -7     -7     -7       -28       -59
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Components may not sum to totals because of rounding.

    Basis of estimate: For the purposes of this estimate, CBO 
assumes that the legislation will be enacted near the beginning 
of fiscal year 2013.
    On July 12, 2012, HHS released Information Memorandum No. 
TANF-ACF-IM-2012-03. That memorandum encouraged states to come 
up with new ways to meet TANF goals, and it stated that the 
Administration for Children and Families (ACF), which 
administers TANF, would provide states waivers through section 
1115 of the Social Security Act so that states could implement 
those proposals. Enacting H.J. Res. 118 would prevent that 
memorandum from taking effect.
    Under the memorandum, CBO expects that penalties for states 
that don't meet the work requirements specified in the Social 
Security Act would be reduced because states would have more 
options to meet such requirements. Thus, CBO estimates that 
enacting the resolution would reduce direct spending by $59 
million over the 2012-2022 period, as some states would pay 
increased penalties to the federal government (which are 
recorded in the budget as an offset to direct spending) for 
failing to meet the work requirements.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays that are subject to those 
pay-as-you-go procedures are shown in the following table.

       CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.J. RES. 118 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON SEPTEMBER 13, 2012
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    By fiscal year, in millions of dollars--
                                                      --------------------------------------------------------------------------------------------------
                                                        2012   2013   2014   2015   2016   2017   2018   2019   2020   2021   2022  2012-2017  2012-2022
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       NET INCREASE OR DECREASE (-) IN THE DEFICIT

Statutory Pay-As-You-Go Impact.......................      0     -5     -6     -6     -6     -6     -6     -6     -7     -7     -7       -28       -59
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Components may not sum to totals because of rounding.

    Intergovernmental and private-sector impact: For large 
entitlement programs like TANF, UMRA defines an increase in the 
stringency of conditions as an intergovernmental mandate if the 
affected governments lack authority to offset the costs of 
those conditions while continuing to provide required services. 
If H.J. Res. 118 were enacted, CBO expects that some states 
would fail to meet work requirements of the program and would 
therefore be assessed penalties that would total $59 million 
over the 2013-2022 period. However, states would continue to be 
able to make changes to TANF, for example adjusting eligibility 
criteria or the structure of programs, to avoid or offset such 
costs. Because the TANF program affords states such broad 
flexibility, voiding the memorandum would not be considered an 
intergovernmental mandate as defined by UMRA. H.J. Res. 118 
also contains no private-sector mandates.
    Previous CBO estimate: On September 17, 2012, CBO 
transmitted a cost estimate for H.J. Res. 118 as ordered 
reported by the House Committee on Education and the Workforce. 
The resolution language in both versions is identical and the 
estimated budgetary effects are the same.
    Estimate prepared by: Federal Costs: Jonathan Morancy; 
Impact on State, Local, and Tribal Governments: Lisa Ramirez-
Branum; Impact on the Private Sector: Vi Nguyen.
    Estimate approved by: Peter H. Fontaine, Assistant Director 
for Budget Analysis.

   V. OTHER MATTERS TO BE DISCUSSED UNDER THE RULES OF THE HOUSE OF 
                            REPRESENTATIVES

A. Committee Oversight Findings and Recommendations

    With respect to clause 3(c)(1) of rule XIII of the Rules of 
the House of Representatives (relating to oversight findings), 
the Committee concluded that it was appropriate and timely to 
enact the sections included in the resolution, as reported.

B. Statement of General Performance Goals and Objectives

    With respect to clause 3(c)(4) of rule XIII of the Rules of 
the House of Representatives, the Committee advises that the 
resolution contains no measure that authorizes new or 
additional funding compared with the current law baseline, so 
no statement of general performance goals and objectives for 
which any measure authorizes funding is required.

C. Information Relating to Unfunded Mandates

    This information is provided in accordance with section 423 
of the Unfunded Mandates Act of 1995 (Pub. L. No. 104-4).
    The resolution does not impose a Federal mandate on the 
private sector. The resolution does not impose a Federal 
intergovernmental mandate on State, local, or tribal 
governments.

D. Applicability of House Rule XXI 5(b)

    Clause 5(b) of rule XXI of the Rules of the House of 
Representatives provides, in part, that ``A bill or joint 
resolution, amendment, or conference report carrying a Federal 
income tax rate increase may not be considered as passed or 
agreed to unless so determined by a vote of not less than 
three-fifths of the Members voting, a quorum being present.'' 
The Committee has carefully reviewed the sections of the 
resolution, and states that the resolution does not involve any 
Federal income tax rate increases within the meaning of the 
rule.

E. Congressional Earmarks, Limited Tax Benefits, and Limited Tariff 
        Benefits

    With respect to clause 9 of rule XXI of the Rules of the 
House of Representatives, the Committee has carefully reviewed 
the provisions of the resolution, and states that the 
provisions of the resolution do not contain any congressional 
earmarks, limited tax benefits, or limited tariff benefits 
within the meaning of the rule.

      CHANGES IN EXISTING LAW MADE BY THE RESOLUTION, AS REPORTED

    H.J. Res. 118 makes no changes to current law.

                            DISSENTING VIEWS

    We oppose H.J. Res. 118 because the bill is based on a 
widely discredited claim and because it would stymie innovative 
approaches to moving more people from welfare to work. 
Moreover, this bill is a distraction from what Congress should 
be focused on--helping the economy grow and creating jobs.
    On July 12, 2012 the Department of Health and Human 
Services (HHS) issued a memorandum under its authority under 
Section 1115 of the Social Security Act to entertain requests 
from states to conduct demonstration projects under the 
Temporary Assistance for Needy Families (TANF) program. The HHS 
notice clearly and repeatedly states that all demonstration 
projects must be focused on improving employment outcomes. In a 
letter to the Chairman of the Committee on Ways and Means, HHS 
Secretary Sebelius stated, ``the Department is providing a very 
limited waiver opportunity for states that develop a plan to 
measurably increase the number of beneficiaries who find and 
hold down a job. Specifically, Governors must commit that their 
proposals will move at least 20% more people from welfare to 
work compared to the state's past performance.''
    In short, any demonstration project would have to be 
designed to increase employment, would be subject to rigorous 
evaluation, and would be terminated if it failed to meet 
employment goals. It is also important to note that nothing in 
the waiver authority would change the current five-year federal 
time limit on TANF benefits or the fixed funding levels now 
provided to states under the TANF program.
    Despite this clear focus on increasing employment, 
Republicans have claimed the waiver initiative would eliminate 
work requirements for welfare recipients. A variety of 
independent fact checkers have forcefully declared this claim 
is dishonest, using such phrases as ``pants on fire'' false. 
Even the lead Republican staffer in charge of drafting the 1996 
welfare law, Ron Haskins, has said, ``there is no plausible 
scenario under which it really constitutes a serious attack on 
welfare reform,'' and ``on the merits, waivers are justified.''
    The Administration proposed the demonstration authority 
after consultations with state officials who believed they can 
do a better job of moving welfare recipients into work if 
provided additional flexibility. For example, Governor Herbert 
of Utah, a Republican, informed HHS that his State was 
interested in being evaluated on the basis of the state's 
success in placing welfare recipients into employment, and that 
this approach ``would require some flexibility at the state 
level and the granting of a waiver.'' Other states highlighted 
how much time, money and effort was dedicated to meeting 
federal paperwork requirements, especially after changes 
included in the Deficit Reduction Act of 2005. For example, one 
study in Minnesota found that TANF employment counselors spend 
more time documenting activities than they spend on providing 
direct services to help people find work.
    Contrary to the majority's assertion that HHS does not have 
the authority to permit demonstration projects, the non-
partisan Congressional Research Service (CRS) has found that 
the current HHS waiver initiative is ``consistent'' with prior 
practice. The CRS review found that dozens of waivers for 
demonstration projects have been approved in the past when 
their subject matter has been referenced in Section 402 of the 
Social Security Act (just as the Secretary now proposes). CRS 
also found nothing in the law that bars the Secretary from 
providing waivers related to employment activities in the TANF 
program.
    The majority's current effort to prevent flexibility 
through waivers seems in direct conflict with their past 
support for waivers. For example, in 2005, Republicans brought 
legislation to the House floor that included a much broader 
waiver authority than now being permitted by HHS. Under that 
bill (H.R. 4241), HHS could have waived both work requirements 
and time limits under the TANF program if ``necessary and 
appropriate for conduct of the demonstration project.'' The 
Congressional Research Service confirms that this legislation, 
and two prior Republican bills, ``would have had the effect of 
allowing TANF work participation standards to be waived.''
    Based on false claims, H.J. Res. 118 appears more focused 
on politics than on policy. On that basis, and because it would 
impede progress in helping more welfare recipients move into 
work, we oppose this measure.

                                   Sander Levin.
                                   Charles B. Rangel.
                                   John Lewis.
                                   Xavier Becerra.
                                   Earl Blumenauer.
                                   Joseph Crowley.
                                   Mike Thompson.
                                   Lloyd Doggett.
                                   Jim McDermott.
                                   Richard E. Neal.
                                   John B. Larson.
                                   Ron Kind.
                                   Bill Pascrell, Jr.
                                   Pete Stark.