H. Rept. 113-13 - 113th Congress (2013-2014)

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House Report 113-13 - PRESERVING WORK REQUIREMENTS FOR WELFARE PROGRAMS ACT OF 2013

[House Report 113-13]
[From the U.S. Government Publishing Office]


113th Congress                                             Rept. 113-13
                        HOUSE OF REPRESENTATIVES
 1st Session                                                     Part 1

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



 
     PRESERVING WORK REQUIREMENTS FOR WELFARE PROGRAMS ACT OF 2013

                                _______
                                

 March 11, 2013.--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.R. 890]

      [Including cost estimate of the Congressional Budget Office]

    The Committee on Ways and Means, to whom was referred the 
bill (H.R. 890) to prohibit waivers relating to compliance with 
the work requirements for the program of block grants to States 
for temporary assistance for needy families, and for other 
purposes, having considered the same, report favorably thereon 
without amendment and recommend that the bill do pass.

                       I. SUMMARY AND BACKGROUND

A. Purpose and summary

    The bill, H.R. 890, as ordered reported by the Committee on 
Ways and Means on March 6, 2013, prohibits the Secretary of 
Health and Human Services (HHS) from issuing waivers relating 
to compliance with the work requirements for welfare recipients 
under the Temporary Assistance for Needy Families (TANF) 
program. Specifically, the legislation states that the 
Secretary of Health and Human Services (HHS) may not 
``finalize, implement, enforce, or otherwise take any action to 
give effect to the Information Memorandum dated July 12, 2012'' 
which HHS issued regarding waiving the TANF work requirements. 
Further, the legislation states the Secretary may not 
``authorize, approve, renew, modify, or extend any 
experimental, pilot, or demonstration project . . . that waives 
compliance with a requirement of section 407,'' which contains 
the TANF work requirements.

B. Background and the need for legislation

    On February 28, 2013, Representative Dave Camp (R-MI), 
Chairman of the Committee on Ways and Means, and Representative 
John Kline (R-MN), Chairman of the Committee on Education and 
the Workforce, along with Representative Steve Scalise (R-LA) 
and Representative Steve Southerland (R-FL) introduced H.R. 
890, which prohibits the Secretary of HHS from issuing waivers 
related to compliance with the work requirements for welfare 
recipients under the TANF program.
    Today's work requirements for welfare recipients under the 
TANF program stem from the 1996 welfare reform law (P.L. 104-
193), which led to increased work and earnings, along with 
record declines in poverty and dependence on government cash 
welfare benefits among low-income families. Fully understanding 
the need for H.R. 890 requires a brief review of welfare reform 
history dating back to the late 1980s.
            The failed former AFDC program did not include real work 
                    requirements
    The 1996 welfare reforms replaced the prior Aid to Families 
with Dependent Children (AFDC) program with the new Temporary 
Assistance for Needy Families (TANF) program. AFDC, which 
originated in the New Deal of the 1930s, was characterized by 
no effective work or activity requirements for welfare 
recipients, who were allowed to collect welfare checks for 
unlimited periods of time. Prior to the 1996 reforms, almost 
two-thirds of families receiving welfare under AFDC remained on 
welfare for eight or more years, and the average lifetime 
receipt of welfare for families then receiving AFDC benefits 
was 13 years.\1\
---------------------------------------------------------------------------
    \1\Ways and Means Committee Print 104-14, Background Material and 
Data on Programs within the Jurisdiction of the Committee on Ways and 
Means (Green Book) Section 8, page 505, available online at http://
www.gpo.gov/fdsys/search/pagedetails.action?granuleId=&packageId=GPO-
CPRT-104WPRT23609.
---------------------------------------------------------------------------
    Further, prior to the 1996 reforms, few recipients engaged 
in work while collecting benefits. In fiscal year 1995, a year 
in which the U.S. unemployment rate was under 6 percent, only 
nine percent of adults receiving AFDC were actually working. In 
contrast, in 2009 in the midst of the deepest recession since 
World War II during which the unemployment rate reached 10 
percent, 24 percent of adults collecting TANF assistance were 
working, while other recipients of cash welfare participated in 
a variety of work-like activities including job training, job 
readiness, and education in exchange for their benefits.\2\
---------------------------------------------------------------------------
    \2\HHS TANF Ninth Report to Congress, Chapter 10, Table E, 
available online at http://www.acf.hhs.gov/sites/default/files/ofa/
9th_report_to_congress_3_26_12.pdf.
---------------------------------------------------------------------------
            States tested new work requirements with pre-1996 waivers
    Recognizing the serious failings of the former AFDC 
program, in the late 1980s and early 1990s a number of States 
sought waivers of AFDC rules so they could test new work and 
related requirements for welfare recipients, which otherwise 
would have been prohibited under AFDC law. Based in part on 
evidence from those pre-reform waiver demonstrations, the 
bipartisan 1996 TANF reforms created strong new work 
requirements for both persons receiving welfare benefits as 
well as States, among other major changes.
            1996 Reforms created strong new work requirements in all 
                    states
    In general, the 1996 reforms offered States new flexibility 
in designing welfare programs in exchange for fixed federal 
funds. However, in order to ensure that low-income families in 
all States benefitted from the lessons of pre-reform waiver 
demonstrations, the 1996 reforms included strong new Federal 
work requirements that expected all States to engage adult 
welfare recipients in work and related activities including job 
training, job readiness, and education. These work requirements 
now specify the minimum hours of work or related activities an 
individual must engage in each week, how ``work activities'' 
are defined, what share of adults on welfare must engage in 
work or related activities, and penalties for failure to 
comply, among other requirements.
    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 2007 
recession it is still higher than before welfare reform\3\; (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''\4\; (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\5\; and (4) Child poverty fell dramatically after 
welfare reform and is still below the level in the early 
1990s.\6\
---------------------------------------------------------------------------
    \3\Congressional Research Service estimates based on Census Bureau 
data prepared for Ways and Means staff.
    \4\HHS TANF Ninth Report to Congress, Chapter 4, available online 
at http://www.acf.hhs.gov/sites/default/files/ofa/
9th_report_to_congress_3_26_12.pdf.
    \5\HHS, ACF, 2011 TANF Caseload Data, available online at http://
www.acf.hhs.gov/programs/ofa/data-reports/caseload/
caseload_current.htm.
    \6\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.
---------------------------------------------------------------------------
            Extensive evidence that TANF work requirements cannot be 
                    waived
    To ensure that no State was able to re-establish the type 
of policies that led to record dependence under the prior AFDC 
program, the 1996 reforms included a prohibition on States' 
``waiving'' the new work requirements. TANF law, history, and 
precedent support the fact that TANF work requirements may not 
be waived by the Secretary of HHS.
    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 AFDC 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 reflected in 
the new TANF law was a restructuring of section 402 of the 
Social Security Act, 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 seven 
reporting requirements that States must outline in a written 
report, with HHS having authority only over reviewing the State 
plans for completeness--instead of approving specific State 
policies as under the prior AFDC law.
    Congress also created a new section titled ``Waivers'' in 
section 415 of the Social Security Act to explain how waivers 
would function after the passage of welfare reform. 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 even contemplate waivers 
after the AFDC program ended, which the new TANF law required 
by no later than July 1, 1997 in all States.
    Driving home this point that there could be no waivers of 
the TANF work requirements after enactment of the new law is 
the clear intention of the Committee on Ways and Means, whose 
Members were the principle authors of the reforms. Shortly 
after Congress approved the 1996 welfare reform law, the Ways 
and Means Committee issued a ``Committee Print'' in November 
1996 summarizing the legislation.\7\ In the section describing 
waivers under the new law, the summary stated simply ``Waivers 
granted after the date of enactment may not override provisions 
of the TANF law that concern mandatory work requirements.''
---------------------------------------------------------------------------
    \7\Ways and Means Committee Print 104-15, 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\8\ 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 regulations 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 
waivers under the TANF program, 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.
---------------------------------------------------------------------------
    \8\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 under TANF 
law. In the official HHS guidance issued in response,\9\ 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 HHS 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,\10\ which repeated word 
for word the same statements about waiver authority made in the 
2005 HHS guidance.
---------------------------------------------------------------------------
    \9\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.
    \10\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.
---------------------------------------------------------------------------
            Obama Administration illegally waives work requirements
    Despite this history and legal precedent, and after 16 
years of welfare policy and practice to the contrary, the Obama 
Administration on July 12, 2012 released an ``Information 
Memorandum''\11\ that for the first time in the history of the 
TANF program suggested the Secretary of HHS has authority to 
waive work requirements in any State. The Administration's July 
12, 2012 rule was not the result of any new legislation passed 
by Congress, nor even connected to any proposal submitted in a 
prior Administration budget or other legislative proposal. The 
Administration's July 2012 rule would have the effect of 
allowing any State to opt out of the TANF work requirements for 
the first time since welfare reform's passage in 1996. No prior 
HHS Secretary, Republican or Democrat, had ever concluded that 
he or she had the authority to waive the TANF work 
requirements.
---------------------------------------------------------------------------
    \11\HHS, TANF Information Memorandum, No. TANF-ACF-IM-2012-03, 
available online at http://www.acf.hhs.gov/programs/ofa/resource/
policy/im-ofa/2012/im201203/im201203.
---------------------------------------------------------------------------
            House acts in 2012 to reject administration waiver policy 
                    under Congressional Review Act
    It was to prevent precisely such illegal legislating by the 
Executive branch that Congress created the Congressional Review 
Act in 1996. The Congressional Review Act established expedited 
procedures by which Congress may disapprove of a federal agency 
rule by enacting a joint resolution of disapproval.
    As HHS did not officially submit to Congress their guidance 
indicating that they would waive work requirements nor publish 
the July 12 Information Memorandum officially as a rule, on 
July 31, 2012, Chairman Camp and Senate Finance Ranking Member 
Hatch (R-UT) asked the Government Accountability Office (GAO) 
to review this Information Memorandum to determine if it was a 
rule that should have been submitted officially to Congress 
before taking effect.\12\ On September 4, 2012, GAO reported to 
Congress that the HHS Information Memorandum 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.\13\ On September 11, 2012, senior members of the House and 
Senate introduced resolutions (H.J. Res. 118 and S.J. Res 50, 
respectively) to disapprove of the HHS July 12, 2012 rule 
waiving work requirements in the TANF program. The House 
Committees on Ways and Means and Education and the Workforce 
marked up and favorably reported H.J. Res. 118 on September 18, 
2012, and this resolution of disapproval passed the House by a 
vote of 250-164 on September 20, 2012. The Senate did not act 
on S.J. Res 50 before the end of the 112th Congress.
---------------------------------------------------------------------------
    \12\Letter from Representative 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.
    \13\Letter from GAO Comptroller General Gene Dorado to 
Representative Dave Camp and Sen. Orrin Hatch, September 4, 2012, 
available online at http://waysandmeans.house.gov/news/
documentsingle.aspx?DocumentID=307447.
---------------------------------------------------------------------------
            House acts in 2013 to reject administration waiver policy 
                    under H.R. 890, saving taxpayers $61 million
    As of March 6, 2013, the Committee knows of no States that 
have formally requested a waiver based on the Administration's 
illegal waiver rule. However, to ensure that the TANF work 
requirements are not waived by HHS, on February 28, 2013, Ways 
and Means Chairman Camp, along with Chairman Kline of the 
Committee on Education and the Workforce and Representatives 
Scalise and Southerland, introduced H.R. 890, the Preserving 
Work Requirements for Welfare Programs Act of 2013. This 
legislation would prohibit the Secretary of HHS from issuing 
waivers related to compliance with the work requirements for 
welfare recipients under the TANF program. The Committee on 
Ways and Means approved this legislation in a markup session 
held on March 6, 2013.
    According to the Congressional Budget Office, H.R. 890 
would reduce Federal welfare spending by $61 million over 10 
years. CBO explained the reason for these savings in a February 
27, 2013 letter\14\ to Chairman Camp, suggesting that the Obama 
Administration's waiver policy would ``lower the potential 
penalties assessed by the federal government for states' 
failure to meet work requirements in the Temporary Assistance 
for Needy Families (TANF) program.'' Under current law, States 
that fail the work requirements are penalized by losing some 
Federal TANF funds. Thus if the work requirements are waived, 
the penalties for failing the work requirements also would not 
be imposed, and Federal welfare spending would rise--
specifically in States that would fail to satisfy the current 
work requirements. In short, by waiving the work requirements, 
the Administration policy would also let States that fail to 
satisfy the work requirements evade the current financial 
penalties for doing so. Avoiding this unnecessary expenditure 
of Federal welfare funds resulting from the Administration's 
illegal waiver policy is yet another reason arguing for the 
passage of H.R. 890.
---------------------------------------------------------------------------
    \14\CBO Letter to Chairman Dave Camp, February 27, 2013, available 
on line at: http://waysandmeans.house.gov/uploadedfiles/
hjr118davecampltr.pdf.
---------------------------------------------------------------------------
    As outlined above, the Committee believes H.R. 890 is 
needed to ensure the Secretary is not allowed to waive the 
critical TANF work requirements. The Secretary's waivers would 
not only cost taxpayers $61 million more in welfare spending, 
but they would also allow States to weaken work requirements 
and may effectively revive former AFDC rules under which large 
numbers of adults on welfare failed to engage in any productive 
work or activities in exchange for benefits. That would be 
especially destructive for families on welfare, millions of 
whom remained trapped in dependence year after year before 
welfare was transformed into a program that expected work or 
preparation for work in exchange for benefits.

C. Legislative history

            Background
    H.R. 890 was introduced on February 28, 2013, 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 bill on March 
6, 2013, and ordered the bill favorably reported.
    Chairman Kline, Chairman of the Committee on Education and 
the Workforce, indicated by letter to Chairman Camp that the 
Committee on Education and the Workforce would forgo further 
consideration of H.R. 890, with the understanding that ``this 
procedural route will not be construed to prejudice the 
committee's jurisdictional interest and prerogatives on this 
bill or any other similar legislation and will not be 
considered as precedent for consideration of matters of 
jurisdictional interest'' to the Committee on Education and the 
Workforce.
            Committee hearings
    On February 28, 2013, the Subcommittee on Human Resources 
held a hearing on the effects of waiving the work requirements 
in the TANF program. During this hearing, the Subcommittee 
heard testimony from experts on work and activity requirements 
and their importance in ensuring that States engage low-income 
parents in work and other productive activities so they can 
increase their work and earnings, leave poverty, and lead lives 
independent from welfare.

                      II. EXPLANATION OF THE BILL

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.R. 890 
states that the Secretary of Health and Human Services (HHS) 
may not ``finalize, implement, enforce, or otherwise take any 
action to give effect to the Information Memorandum dated July 
12, 2012'' which HHS issued regarding waiving the TANF work 
requirements. Further, the legislation states the Secretary may 
not ``authorize, approve, renew, modify, or extend any 
experimental, pilot, or demonstration project . . . that waives 
compliance with a requirement of section 407,'' which contains 
the TANF work requirements. Finally, although to the 
Committee's knowledge as of March 6, 2013 no State had sought 
or been granted a waiver under the Administration's July 12, 
2012 rule, H.R. 890 would rescind any waivers the Secretary may 
have granted related to the work requirements prior to the 
legislation's enactment.
    The Committee believes that prohibiting waivers relating to 
compliance with the TANF 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 would prohibit the Secretary of HHS from 
issuing waivers related to compliance with the work 
requirements for welfare recipients under the TANF program.

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 bill, H.R. 890.
    The bill, ``H.R. 890, prohibiting waivers relating to 
compliance with the work requirements for the program of block 
grants to States for temporary assistance for needy families, 
and for other purposes,'' was ordered favorably reported 
without amendment to the House of Representatives by a roll 
call vote of 21 yeas to 14 nays (with a quorum being present). 
The vote was as follows:

Votes of the committee

    In compliance with the Rules of the House of 
Representatives, the following statement is made concerning the 
vote of the Committee on Ways and Means during the markup 
consideration of H.R. 890 ``Preserving Work Requirements for 
Welfare Programs Act of 2013.''
    The bill, H.R. 890, was ordered favorably reported by a 
roll call vote of 21 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. Johnson..................         X   .........  .........  Mr. Rangel.....  .........         X   .........
Mr. Brady....................         X   .........  .........  Mr. McDermott..  .........         X   .........
Mr. Ryan.....................         X   .........  .........  Mr. Lewis......  .........         X   .........
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   .........  .........  Mr. Crowley....  .........  .........  .........
Mr. Schock...................         X   .........  .........  Ms. Schwartz...  .........  .........  .........
Ms. Jenkins..................         X   .........  .........  Mr. Davis......  .........         X   .........
Mr. Paulsen..................         X   .........  .........  Ms. Sanchez....  .........         X   .........
Mr. Marchant.................         X   .........  .........
Ms. Black....................         X   .........  .........
Mr. Reed.....................         X   .........  .........
Mr. Young....................         X   .........  .........
Mr. Kelly....................         X   .........  .........
Mr. Griffin..................         X   .........  .........
Mr. Renacci..................         X   .........  .........
----------------------------------------------------------------------------------------------------------------

Votes on amendments

    No amendments to the bill were offered.

                     IV. BUDGET EFFECTS OF THE BILL

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 bill, H.R. 890 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 bill as reported is in compliance with clause 3(c)(2) 
of rule XIII of the Rules of the House of Representatives. 
Further, the bill 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, March 8, 2013.
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.R. 890, the 
Preserving Work Requirements for Welfare Programs Act of 2013.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Jonathan 
Morancy.
            Sincerely,
                                          Peter A. Fontaine
                                        (For Douglas W. Elmendorf).
    Enclosure.

H.R. 890--Preserving Work Requirements for Welfare Programs Act of 2013

    Summary: H.R. 890 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). If H.R. 890 is enacted, the rule would have no 
force or effect.
    CBO estimates that enacting H.R. 890 would reduce direct 
spending by $61 million over the 2013-2023 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 H.R. 890 would have 
any significant effect on spending subject to appropriation.
    H.R. 890 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 H.R. 890 is shown in the following table. 
The effects 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   2023  2013-2018  2013-2023
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                               CHANGES IN DIRECT SPENDING

Estimated Budget Authority...........................      0     -6     -6     -6     -6     -6     -6     -7     -7     -7     -7       -29        -61
Estimated Outlays....................................      0     -6     -6     -6     -6     -6     -6     -7     -7     -7     -7       -29        -61
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Annual amounts do not sum to totals because of rounding.

    Basis of estimate: For the purposes of this estimate, CBO 
assumes that the legislation will be enacted during 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, which administers 
TANF, would provide states waivers through section 1115 of the 
Social Security Act so that states could implement those 
proposals. Enacting H.R. 890 would prevent that memorandum from 
taking effect.
    Under the memorandum, CBO expects that penalties for states 
that do not meet the work requirements specified in section 407 
of the Social Security Act would be reduced because some states 
would be able to have those requirement waived. We expect there 
would be no impact on net federal spending during fiscal year 
2013, but that the expected net increase in penalties would 
average about $6 million in subsequent years. Thus, CBO 
estimates that enacting H.R. 890 would reduce direct spending 
by $61 million over the 2013-2023 period, as some states would 
face increased penalties to the federal government, in the form 
of reduced family assistance grants, 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.R. 890 AS ORDERED REPORTED BY THE HOUSE COMMITTEE ON WAYS AND MEANS ON MARCH 6, 2013
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    By fiscal year, in millions of dollars--
                                                      --------------------------------------------------------------------------------------------------
                                                        2013   2014   2015   2016   2017   2018   2019   2020   2021   2022   2023  2013-2018  2013-2023
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                             NET DECREASE (-) IN THE DEFICIT

Statutory Pay-As-You-Go Impact.......................      0     -6     -6     -6     -6     -6     -6     -7     -7     -7     -7       -29        -61
--------------------------------------------------------------------------------------------------------------------------------------------------------
Note: Annual amounts do 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.R. 890 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 $61 million 
over the 2013-2023 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.R. 890 also 
contains no private-sector mandates.
    Previous CBO estimate: On September 17, 2012, CBO 
transmitted a cost estimate for H.J. Res. 118, a proposal 
similar to H.R. 890. The bill language for H.R. 890 is somewhat 
different from the language contained in H.J. Res. 118 (in the 
112th Congress), but CBO expects that the average annual effect 
would be the same. CBO's estimate of the cumulative 10-year 
impact for H.R. 890 is slightly different from the total shown 
in our estimate last year for H.J. Res. 118 because of an 
assumption of later enactment for the current legislation (in 
2013 versus in 2012), and because last year's estimate covered 
the period through fiscal year 2022, while the estimate for 
H.R. 890 covers the period through fiscal year 2023.
    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 bill, as reported.
    On July 12, 2012, the Obama Administration released an 
``Information Memorandum'' that for the first time in the 
history of the TANF program suggested the Secretary of HHS has 
authority to waive work requirements for welfare recipients. 
The Administration's July 2012 rule would have the effect of 
allowing any State to opt out of the TANF work requirements for 
the first time since welfare reform's passage in 1996. No prior 
HHS Secretary, Republican or Democrat, had ever concluded that 
he or she had the authority to waive the TANF work 
requirements.
    On February 28, 2013, the Subcommittee on Human Resources 
held a hearing on the effects of waiving the work requirements 
in the TANF program. During this hearing, the Subcommittee 
heard testimony from experts on work and activity requirements 
and their importance in ensuring that States engage low-income 
parents in work and other productive activities so they can 
increase their work and earnings, leave poverty, and lead lives 
independent from welfare.
    The Committee believes this legislation is necessary to 
ensure that TANF continues to operate as intended by current 
law. This legislation is also needed to ensure that any changes 
to the TANF work requirements are made by Congress, not through 
unilateral action taken by the Executive branch.

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 
bill 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. Duplication of federal programs

    No provision of H.R. 890, the ``Preserving Work 
Requirements for Welfare Programs Act of 2013,'' establishes or 
reauthorizes a program of the Federal Government known to be 
duplicative of another Federal program, a program that was 
included in any report from the Government Accountability 
Office to Congress pursuant to section 21 of Public Law 111-
139, or a program related to a program identified in the most 
recent Catalog of Federal Domestic Assistance.

D. Disclosure of directed rule makings

    The Committee estimates that H.R. 890 specifically directs 
to be completed no specific rule makings within the meaning of 
5 U.S.C. 551.

E. 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 bill does not impose a Federal mandate on the private 
sector. The bill does not impose a Federal intergovernmental 
mandate on State, local, or tribal governments.

F. 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 bill, 
and states that the bill does not involve any Federal income 
tax rate increases within the meaning of the rule.

G. 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 bill, and states that the provisions of 
the bill 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 BILL, AS REPORTED

    H.R. 890 makes no changes to current law.

                            DISSENTING VIEWS

    We oppose H.R. 890 because it, just like nearly identical 
legislation brought before the Committee last year, is based on 
partisan charges that have been widely discredited by 
independent fact checkers and because the bill would block new 
and innovative ways to move more people from welfare to work. 
At a time when Congress confronts so many pressing issues, not 
the least of which is preventing the misguided cuts in the 
sequester from hurting our economy, H.R. 890 is a step in the 
wrong direction.
    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 states that these 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.''
    The Republican Governor of Utah, Gary Herbert, highlighted 
the need for waivers when he wrote a letter to HHS saying, 
``some of [the TANF work] participation requirements are 
difficult and costly to verify, while other participation 
requirements do not lead to meaningful employment outcomes and 
are overly prescriptive. Utah suggested that we be evaluated on 
the basis of the state's success in placing our customers in 
employment . . . [and] this approach would require some 
flexibility at the state level and the granting of a waiver.''
    Other states also have highlighted how much time, money and 
effort is now 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.
    The majority's current effort to prevent flexibility 
through waivers seems in direct conflict with their past 
support for waivers. For example, in 2002, 2003, and 2005, 
Republicans brought legislation to the House floor that 
included a much broader waiver authority than now being 
permitted by HHS. The non-partisan Congressional Research 
Service (CRS) has confirmed that all three bills ``would have 
had the effect of allowing TANF work participation standards to 
be waived.''
    In terms of HHS' authority to permit demonstration 
projects, 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.
    Just like a very similar measure from last year, H.R. 890 
seems 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 M. Levin.
                                   Charles B. Rangel.
                                   Jim McDermott.
                                   John B. Lewis.
                                   Richard E. Neal.
                                   Xavier Becerra.
                                   Mike Thompson.
                                   John B. Larson.
                                   Earl Blumenauer.
                                   Ron Kind.
                                   Bill Pascrell, Jr.
                                   Joseph Crowley.
                                   Allyson Schwartz.
                                   Danny K. Davis.
                                   Linda Sanchez.