BILL ANALYSIS C.S.H.B. 1863 By: Hilderbran (Zaffirini) Health and Human Services 04-19-95 Senate Committee Report (Substituted) BACKGROUND Almost every state in the nation is pursuing some type of welfare reform. Most strive to encourage work by reducing penalties on earnings, to enforce parental responsibilities, to alter rules that penalize two-parent families, to simplify the delivery of benefits, to create jobs for welfare recipients, and to improve access to child and health care. C.S.H.B. 1863 is based on Partnership for Independence, a report on welfare reform completed by the comptroller. The comptroller conducted extensive research with national experts and consultants in order to reflect the direction of welfare reform both in Washington, D.C., and in state capitals across the country. PURPOSE As proposed, C.S.H.B. 1863 makes provisions for increasing employment services and assistance, the reduction of dependence on state assistance, the reduction of public assistance fraud and error, increasing federal funding for specific assistance programs, and requiring proof of immunization for children applicants for state assistance, all in order to assist welfare recipients in achieving independence. RULEMAKING AUTHORITY It is the committee's opinion that rulemaking authority is granted to the Texas Department of Human Services under SECTIONS 1.03 and 5.01 (Sections 31.0126(a) and 31.031(e), Human Resources Code) of this bill. SECTION BY SECTION ANALYSIS ARTICLE 1. WORK REQUIREMENTS SECTION 1.01. ASSISTANCE PRIORITY IS WORK. Amends Section 31.001, Human Resources Code, as follows: Sec. 31.001. AID TO FAMILIES WITH DEPENDENT CHILDREN. (a) Requires the Texas Department of Human Services (DHS) to give first priority to assisting an adult recipient, or unemployed applicant for financial assistance and services, in finding and retaining a job. (b) Requires DHS to give each adult recipient a copy of a bill of responsibilities that defines the responsibilities of the state and the recipient and that encourages personal responsibility. (c) Prohibits DHS from withholding benefits or otherwise penalizing a recipient who fails to meet the responsibilities under Subsection (b) or who fails to participate in training, education, or other programs, if the support services necessary to meet those responsibilities or to participate in training, education, or other programs are not provided to that recipient. SECTION 1.02. CHILD CARE WORK EXEMPTION. Amends Chapter 31A, Human Resources Code, by adding Section 31.0123, as follows: Sec. 31.0123. EXEMPTION FROM JOBS TRAINING PROGRAM. Requires DHS to exempt a caretaker of a dependent child younger than one year of age from participation in a JOBS component. SECTION 1.03. EMPLOYMENT PROGRAMS. (a) Amends Chapter 31A, Human Resources Code, by adding Section 31.0126, as follows: Sec. 31.0126. EMPLOYMENT PROGRAMS. (a) Requires DHS to develop, by rule, certain programs to assist recipients in finding and retaining employment. (b) Requires DHS to develop these programs in accordance with federal law as part of the job opportunities and basic skills (JOBS) training program under the federal Social Security Act. (c) Sets forth guidelines for DHS in adopting rules. (d) Authorizes a local workforce development board to implement one or more programs prescribed by this section in a workforce development area. (e) Requires DHS to submit a waiver application or renewal waiver application that a federal agency may require before implementation of a program. (f) Defines "local workforce development board." (b) Repealer: Section 31.0125, Human Resources Code (Community Work Experience Program). SECTION 1.04. DETERMINATION OF MAXIMUM ALLOWABLE RESOURCES. Amends Sections 31.032(b) and (c), Human Resources Code, as follows: (b) Requires DHS, in determining maximum allowable resources for the purposes of assistance eligibility, to follow federal regulations governing such resources under the food stamp program, 7 CFR Part 273. (c) Makes nonsubstantive changes. SECTION 1.05. DEMONSTRATION PROJECTS; FUND. Amends Article 5190.7a, V.T.C.S. (Workforce and Economic Competitiveness Act), by adding Sections 4.055-4.057, as follows: Sec. 4.055. DEMONSTRATION PROJECTS. (a) Defines "board" and "workforce development agency." (b) Authorizes each local workforce development board (board) to establish and operate localized programs to expand education, training, and employment in the workforce development area, and to design creative programs that fit the area's unique characteristics and needs. (c) Requires a board that designs a program to submit a written proposal for approval to the workforce development agency (agency). Requires the agency to approve any program that meets specific requirements. (d) Requires a board to implement and administer a program approved by the agency as a local demonstration project, and to report to the agency quarterly regarding the administration and effectiveness of the project in serving the needs of the community. (e) Requires a board to submit proposed program changes to the agency in writing. Requires the agency to approve the changes before their adoption and implementation. Sec. 4.056. CERTAIN PROGRAMS FOR AFDC RECIPIENTS. (a) Requires each board to adopt programs to enhance the ability of recipients, who are eligible to participate in the JOBS training program, to obtain and retain gainful employment. Requires the agency to provide technical assistance to the board in adopting programs. (b) Requires the board to consider the programs established under Section 31.0126, Human Resources Code, in adopting programs under this section, and authorizes the board to adapt a program to more effectively serve recipient needs. (c) Requires the agency to approve a board adopted program before the board can implement the program. (d) Defines "JOBS training program." Sec. 4.057. REVOLVING FUND ACCOUNT. (a) Establishes a special revolving fund account, the local workforce development board demonstration project account, in the state treasury to be used only for specific purposes. (b) Sets forth the contents of the account. (c) Requires money drawn from the account to be paid back to the account as certain funds become available. (d) Provides that Sections 403.094 and 403.095, Government Code, do not apply to the account. SECTION 1.06. EMPLOYMENT OPPORTUNITIES FOR PERSONS WITH DISABILITIES. (a) Amends Chapter 121, Human Resources Code, by adding Sections 121.0014 and 121.0015, as follows: Sec. 121.0014. VISION STATEMENT. (a) Provides the text of a statement of vision to be adopted by the Health and Human Services Commission (commission), each health and human services agency, and each state agency administering a workforce development program. (b) Defines "health and human services agency." Sec. 121.0015. INTERAGENCY WORK GROUP. Creates an interagency work group to implement the action plan adopted at the 1994 Supported Employment Summit, and sets forth guidelines for its composition and function. (b) Requires the comptroller, not later than November 15, 1996, to submit a report to the governor and legislature describing the progress toward implementing the action plan, and to notify the legislature and certain standing committees of the filing report. SECTION 1.07. WORK INCENTIVES. Amends Chapter 533.008, Health and Safety Code, by amending the section heading and Subsection (a), and by adding Subsection (e), as follows: Sec. 533.008. New heading: EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS WITH MENTAL ILLNESS AND MENTAL RETARDATION. (a) Requires each Texas Department of Mental Health and Mental Retardation (MHMR) facility and community center to assess the feasibility of converting certain positions into employment opportunities for certain individuals, rather than patients and clients, with mental illness and mental retardation. (e) Requires each MHMR facility and community center to ensure that designated staff have certain training related to the Social Security Administration. SECTION 1.08. WORK INCENTIVES AND SUPPLEMENTAL SECURITY INCOME (SSI). Amends Chapter 111B, Human Resources Code, by adding Section 111.0205, as follows: Sec. 111.0205. WORK INCENTIVES AND SUPPLEMENTAL SECURITY INCOME (SSI). Requires the commission to employ a person at the commission's central office to train counselors to understand and use work incentives, and to review cases to ensure that commission clients are informed of the availability of and assisted in obtaining work incentives and Supplemental Security Income (42 U.S.C. Section 1381 et seq.). SECTION 1.09. COMPETITIVE EMPLOYMENT. (a) Amends Section 21.510(e), Education Code, to require the individual transition plan, of a student at least 16 years of age enrolled in a special education program, to include a goal of competitive employment. (b) Makes Section 21.510(e), Education Code, applicable to an individual transition plan developed for each school year beginning with the 1995-1996 school year. (c) Requires the Central Education Agency (CEA) to study the possible effects of amending Section 21.510, Education Code, to require development of individual transition plans for children at least 14 years of age. Requires CEA, not later than November 15, 1996, to submit its report to the governor and legislature. SECTION 1.10. TEEN-JOBS PILOT PROGRAM. (a) Requires CEA to guide the establishment of pilot programs which encourage teenage parents to stay in school and advance toward independence. (b) Authorizes the program to include certain services. (c) Requires CEA to report to the governor and the 75th Legislature regarding the effectiveness of the program. (d) Provides that this section expires January 1, 1999. SECTION 1.11. PILOT PROGRAM TO ASSIST AFDC CLIENTS IN ACHIEVING SELF-SUFFICIENCY. (a) Requires DHS to establish a pilot program to help families become self-sufficient by extending the period of supported employment. (b) Requires DHS, if it chooses to extend transitional benefits for 24 months, to determine the most cost-effective method of purchasing medical coverage for participants. (c) Requires DHS to report to the governor and the 75th and 76th Legislatures. (d) Defines "fill-the-gap budgeting." (e) Provides that this section expires September 1, 1999. SECTION 1.12. APPLICATION DATE. Makes this article applicable only to a person who receives financial assistance on or after September 1, 1995. ARTICLE 2. REDUCING DEPENDENCE ON STATE ASSISTANCE SECTION 2.01. ADULT LEARNING LABS FOR AFDC CLIENTS. Amends Chapter 11A, Education Code, by adding Section 11.2093, as follows: Sec. 11.2093. EDUCATE TEXAS PROGRAM. (a) Creates the Educate Texas Program (ETP) to provide adult education services to clients of Aid to Families with Dependent Children (AFDC) who are referred to the program under Section 31.0124, Human Resources Code. (b) Requires CEA, the Texas Higher Education Coordinating Board, and the state agency responsible for job training, employment, and workforce development to develop jointly a system of adult education learning laboratories in public schools, community colleges, and other publicly owned facilities under this program to provide certain emergency services to a person eligible to receive AFDC. SECTION 2.02. ELIGIBILITY FOR ADULT LEARNING LABS. Amends Chapter 31A, Human Resources Code, by adding Section 31.0124, as follows: Sec. 31.0124. REFERRAL TO EDUCATIONAL PROGRAMS. Requires DHS to determine whether a person is eligible for adult education services under Section 11.2093, Education Code, and to refer the person to the appropriate education service. SECTION 2.03. ADULT LITERACY AND LEARNING PROGRAMS. Amends Chapter 88, Education Code, by adding Subchapter G, as follows: SUBCHAPTER G. TEXAS CENTER FOR ADULT LITERACY AND LEARNING Sec. 88.541. DUTIES OF TEXAS CENTER FOR ADULT LITERACY AND LEARNING. (a) Requires the Texas Center for Adult Literacy and Learning (center) at Texas A&M University to evaluate recorded materials for use in providing adult literacy instruction and to publish, and encourage the use of, a guide describing and evaluating those materials. (b) Requires the center to develop voluntary standards for materials used in adult education programs. Requires the center to organize an advisory group and encourage the participation of major providers of adult literacy programs in this state. Requires the Texas Department of Criminal Justice to designate an employee to participate in the initial development of the standards. (c) Requires the center to develop materials to track student progress. (d) Requires the center to develop and update distribution materials describing the need for adult literacy and education services and encouraging qualified persons to support or assist these programs. SECTION 2.04. LITERACY: ENGLISH AS A SECOND LANGUAGE. Amends Chapter 13B, Education Code, by adding Section 13.044, as follows: Sec. 13.044. ADULT LITERACY AND ENGLISH AS A SECOND LANGUAGE CURRICULUM. (a) Requires each general academic training institution that conducts an approved teacher education program to include a unit introducing students to the fundamentals of teaching adult literacy and English as a second language courses. (b) Authorizes the institution, if it operates a center for professional development and technology, to provide opportunities for internships and other field-based training and experience in teaching adult literacy or English as a second language. SECTION 2.05. AFDC RECIPIENTS ELIGIBLE FOR FEDERAL PROGRAMS. (a) Amends Article 4413(502), V.T.C.S., by adding Section 22, as follows: Sec. 22. AFDC RECIPIENTS ELIGIBLE FOR FEDERAL PROGRAMS. (a) Requires the Health and Human Services Commission to assist recipients of financial assistance under Chapter 31, Human Resources Code, who are eligible for assistance under federal programs to apply for benefits under those programs. Authorizes HHSC to delegate this responsibility to a health and human services agency under Section 19, contract with a local unit of government, or use another cost-effective measure to assist financial assistance recipients who are eligible for federal programs. (b) Requires HHSC to organize a planning group involving DHS, CEA, and TRC to improve workload coordination and to assist the consultant in certain ways. (b) Requires the planning group, not later than January 15, 1997, to submit to the legislature and governor a report on the progress of the state in transferring recipients of state assistance to federal programs. SECTION 2.06. FEDERAL TAX CREDIT. Amends Chapter 403B, Government Code, by adding Section 403.024, as follows: Sec. 403.024. FEDERAL EARNED INCOME TAX CREDIT. (a) Makes the comptroller's office the lead state agency in promoting awareness of the federal earned income tax credit program for working families. (b) Requires the comptroller to recruit other state agencies and the governor's office to participate in a coordinated campaign to increase awareness of the federal tax program. SECTION 2.07. PILOT PROGRAM: TIME-LIMITED BENEFITS. Requires and sets forth guidelines concerning the establishment by DHS of a time-limited benefits pilot program that limits the amount of time a person can receive financial assistance under Chapter 31, Human Resources Code. Requires DHS to submit a report concerning the effectiveness of the pilot program to the governor and the 75th, 76th, and 77th Legislatures. Provides that this section expires September 1, 2001. SECTION 2.08. PILOT PROGRAM: EMERGENCY ASSISTANCE FOR FAMILIES IN A CRISIS. Requires and sets forth guidelines for the establishment by DHS of an emergency assistance pilot program to support families in a crisis. Requires DHS to report to the governor and 75th and 76th Legislatures regarding the program's success in helping families in a crisis avoid becoming AFDC clients. Provides that this section expires September 1, 1999. SECTION 2.09. PILOT PROGRAM: SAVINGS ACCOUNTS FOR AFDC RECIPIENTS. Requires and sets forth guidelines for the establishment by DHS of a pilot program to create individual development accounts for individuals who receive financial assistance under Chapter 31, Human Resources Code, to encourage recipients to achieve self-sufficiency. Grants DHS specific rulemaking authority. Requires DHS to report to the governor and the 75th and 76th Legislatures regarding the success of the program. Provides that this section expires September 1, 1999. SECTION 2.10. WORK HISTORY AND 100-HOUR RULE WAIVER. Requires DHS, not later than December 1, 1995, to reapply for a federal waiver to eliminate the work history and 100-hour rules for two-parent families and to enable DHS to fully implement Section 31.014, Human Resources Code. SECTION 2.11. APPLICATION DATE. Makes this article applicable only to a person receiving assistance under Chapter 31, Human Resources Code, on or after September 1, 1995. ARTICLE 3. REDUCING FRAUD AND ERROR SECTION 3.01. PUBLIC ASSISTANCE FRAUD OVERSIGHT TASK FORCE. Amends Chapter 21, Human Resources Code, by adding Section 21.0145, as follows: Sec. 21.0145. PUBLIC ASSISTANCE FRAUD OVERSIGHT TASK FORCE. (a) Creates the Public Assistance Fraud Oversight Task Force (task force) to advise and assist DHS and DHS' office of the inspector general in improving the efficiency of fraud investigations and collections. (b) Sets forth the composition of the task force. (c) Provides that the comptroller or comptroller's designee serves as the presiding officer of the task force. Authorizes the task force to elect other necessary officers. (d) Requires the task force to meet at least once each fiscal quarter at the call of the presiding officer. (e) Makes the appointing agency responsible for the expenses of a member's service, and provides that members receive no additional compensation for service. (f) Requires DHS' office of the inspector general, at least once each fiscal quarter, to provide the task force with specific information, SECTION 3.02. FRAUD PREVENTION. (a) Amends Chapter 22, Human Resources Code, by adding Section 22.027, as follows: Sec. 22.027. FRAUD PREVENTION. (a) Requires DHS' office of the inspector general to compile and disseminate information relating to fraud prevention and post-fraud referrals. (b) Requires DHS to publicize successful fraud prosecutions and establish and promote a toll-free hotline for reporting suspected fraud in DHS programs. (c) Requires DHS to establish an interstate information sharing agreement with certain states to prevent a person from receiving public assistance simultaneously from more than one state. Requires the agreement to provide for sharing information necessary to identify an applicant or recipient. (d) Requires DHS to verify automobile information used as criteria for eligibility and establish a computerized matching system to prevent an incarcerated individual from receiving public assistance benefits illegally. Sec. 22.028. ELECTRONIC BENEFITS TRANSFER: MONITORING. (a) Requires the electronic benefits transfer (EBT) operator, with which the department contracts to administer the EBT system, to establish procedures to maintain records that monitor all debit transactions relating to EBT client accounts under this section. Requires the EBT operator to deliver copies of the records to DHS and the comptroller by a certain date. Requires DHS to immediately review the records and assess the propriety of the debit transactions. (b) Requires DHS, after reviewing the records under Subsection (a), to take necessary or advisable action to ensure compliance with EBT rules by the EBT operator, retailers, and clients. (c) Requires DHS, not later than the first day of each month, to send the comptroller a report listing the accounts on which enforcement actions or other steps were taken by DHS in response to the records received from the EBT operator under this section, and the action taken by DHS. Requires the comptroller to review the report. Authorizes the comptroller to solicit the advice of the task force regarding the results of DHS' enforcement actions. (b) Requires DHS to evaluate the costs and benefits of the five-day time limit prescribed for the investigation of fraud referrals and to consider lowering the criteria for acceptance of post-fraud referrals. (c) Requires DHS to require each department office to apply the new criteria, if DHS lowers the criteria for accepting post-fraud referrals. SECTION 3.03. PREVENTING FRAUD THROUGH CERTIFICATE OF TITLE. Amends Article 6687-1, V.T.C.S. (Certificate of Title Act), by adding Section 27a to require the Department of Public Safety (DPS), in a county in which DPS' automated registration and title system has been implemented, to require an individual applying for a certificate of title to give the applicant's social security number; and requires DPS to enter the number in DPS' electronic database but may not print the number on the certificate of title. SECTION 3.04. PREVENTING FRAUD THROUGH VEHICLE REGISTRATION DATABASE. Amends Article 6675a-17A, V.T.C.S., by amending Subsection (b) and adding Subsection (c), as follows: (b) Provides that this section does not apply to the release of information to an official of a political subdivision of the state if the official is requesting the information to determine eligibility for a state public assistance program. (c) Requires the Texas Department of Transportation to provide a dedicated line to its registration record database for determination by other state agencies of eligibility for a state public assistance program. SECTION 3.05. TASK FORCE: ELECTRONIC BENEFITS TRANSFERS. Amends Article 4413(502), V.T.C.S., by adding Section 10B, as follows: Sec. 10B. INTERAGENCY TASK FORCE ON ELECTRONIC BENEFITS TRANSFERS. (a) Creates an interagency task force to advise and assist HHSC in adding new benefit programs to the statewide EBT system. (b) Sets forth the composition of the task force. (c)-(f) Set forth guidelines for the functioning of the task force. (g)-(h) Set forth duties of the task force and specific considerations in determining which programs can be added to the state's EBT system. SECTION 3.06. ERROR-RATE REDUCTION. (a) Amends Chapter 22, Human Resources Code, by adding Sections 22.025 and 22.026, as follows: Sec. 22.025. ERROR-RATE REDUCTION. (a) Requires DHS to set progressive goals for improving its error rates in the AFDC and food stamp programs and to develop a specific schedule to meet those goals. (b) Requires DHS to prepare a quarterly report detailing DHS' progress in reaching its goals. (c) Requires DHS to include in its employee evaluation process a rating system that emphasizes error-rate reduction and workload. (d) Requires DHS to take appropriate disciplinary action against management and other staff if a region has a higher than average error rate that is not reduced in a reasonable period. Sec. 22.026. REDUCTION OF CLIENT FRAUD. Requires DHS to ensure that errors attributed to client fraud are appropriate and to take immediate action to limit client fraud. (b) Requires DHS, not later than November 1, 1995, to develop a concentrated and effective plan for the city of Houston region to reduce DHS' error rates in the AFDC and food stamp programs. (c) Requires DHS to make the first progress report not later than September 1, 1995. SECTION 3.07. MODIFICATION OF SCREENING AND SERVICE DELIVERY REQUIREMENTS. Amends Section 33.002, Human Resources Code, by adding Subsection (g), to authorize DHS to modify one-day screening and service delivery requirements if DHS determines that modification is necessary to achieve a state error rate equal to or below the national average. SECTION 3.08. ELECTRONIC IMAGING PILOT PROGRAM. Requires DHS to develop, by rule, a 36-month pilot program in Harris County to prevent welfare fraud by using fingerprint-imaging of applicants for and recipients of assistance. Requires DHS to report quarterly to the governor and legislature on the status and progress of the program. Requires DHS to establish the program not later than January 1, 1996. ARTICLE 4. INCREASING FEDERAL FUNDING SECTION 4.01. FEDERAL FUNDING: MENTAL HEALTH SERVICES. Amends Chapter 533B, Health and Safety Code, by adding Section 533.046, as follows: Sec. 533.046. FEDERAL FUNDING FOR MENTAL HEALTH SERVICES FOR CHILDREN AND FAMILIES. (a) Requires the Texas Department of Mental Health and Mental Retardation to enter into an interagency agreement with DHS to amend the eligibility requirements of the state's emergency assistance plan, in order to include mental health emergencies, and to prescribe the procedures for agencies in delegating the administration of mental health emergency assistance. (b) Sets forth requirements for the interagency agreement. (c) Requires DHS to allocate 66 percent of federal funds received under this section to local mental health and mental retardation authorities. SECTION 4.02. FEDERAL FUNDING: CHEMICAL DEPENDENCY SERVICES. (a) Amends Article 4413(502), V.T.C.S., by adding Section 10A, as follows: Sec. 10A. FEDERAL FUNDING FOR CHEMICAL DEPENDENCY SERVICES. Requires HHSC to amend, in coordination with the Texas Commission on Alcohol and Drug Abuse and DHS, requirements of the state's emergency assistance plan under the federal Social Security Act to include either a child or a significant adult in a child's family who needs chemical dependency treatment. (b) Requires the Texas Department on Alcohol and Drug Abuse to continue to study the feasibility of amending the state's Medicaid plan to include chemical dependency treatment as an allowable service. SECTION 4.03. FEDERAL FUNDS; FOSTER CARE. (a) Amends Article 4413(503), V.T.C.S., by adding Section 12A, as follows: Sec. 12A. FEDERAL FUNDING FOR CERTAIN CHILDREN. (a) Requires the Department of Protective and Regulatory Services (DPRS) to classify each child in the conservatorship of the state and placed in the home of a relative as a "child in foster care" for the purposes of Medicaid eligibility only. Provides that a "child in foster care" is not automatically eligible to receive foster care payments because of that classification. (b) Requires DPRS to ensure that each time study used for allocating costs identifies all costs incurred on behalf of the child, if the child's case plan clearly indicates that foster care is the planned arrangement for the child. (c) Requires DPRS to claim, at the highest rate authorized by federal law, federal financial participation under the federal Social Security Act for all nonrecurring adoption expenses. Requires DPRS to include all charges from state attorneys and state courts and any applicable overhead. Authorizes DPRS to claim the expenses as either administrative or training expenses, depending on which results in a higher federal match. (b) Requires DPRS to file an adjustment to its previous quarterly claims. (c) Requires DPRS to request a waiver from the two-year limitation on the period in which the state can file certain claims. ARTICLE 5. IMMUNIZATIONS SECTION 5.01. IMMUNIZATIONS FOR CHILDREN. Amends Section 31.031, Human Resources Code, by adding Subsections (c), (d), and (e), as follows: (c) Requires DHS to require the applicant to provide proof that each child for whom the applicant will receive assistance has been immunized, is currently receiving an immunization series, or is exempted under Section 161.004(d), Health and Safety Code. (d) Requires an applicant, who cannot provide proof when applying, to provide the proof not later than the 180th day after the date DHS determines the applicant is eligible for assistance. (e) Requires DHS to provide the applicant with information regarding immunization services available in the applicant's residential area. Requires DHS, if the applicant does not read or comprehend English, to provide the information in a language that the applicant reads or comprehends. (f) Requires DHS, by rule, to provide sanctions for failure to comply with Subsection (c) or (d). ARTICLE 6. WAIVER; EFFECTIVE DATE; EMERGENCY SECTION 6.01. WAIVER. Requires a state agency, if it determines that a waiver or authorization from a federal agency is necessary for implementation, to request the waiver or authorization, and authorizes DHS to delay implementation until either is granted. SECTION 6.02. Effective date: September 1, 1995. SECTION 6.03. Emergency clause.