88R11340 KKR-F

By: Hughes S.B. No. 1871

A BILL TO BE ENTITLED

AN ACT

relating to the creation of the Texas Empowerment Account pilot program for assisting certain recipients of public benefits in achieving self-sufficiency.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS:

SECTION 1. Subtitle C, Title 2, Human Resources Code, is amended by adding Chapter 37 to read as follows:

CHAPTER 37. TEXAS EMPOWERMENT ACCOUNT PILOT PROGRAM

Sec. 37.001. DEFINITIONS. In this chapter:

(1) "Comptroller" means the comptroller of public accounts.

(2) "Eligible expense" means an expense for which a program participant may use money under the pilot program in accordance with rules adopted by the commission and comptroller.

(3) "Family" means individuals residing in the same household, with at least one parent or guardian and one child under the age of eighteen.

(4) "Financial assistance benefits" means money payments under the Temporary Assistance for Needy Families operated under Chapter 31 or under the state temporary assistance and support services program operated under Chapter 34.

(5) "Pilot program" means the Texas empowerment account program established under this chapter.

(6) "Program participant" means a family enrolled in the pilot program.

(7) "Self-sufficiency" means:

(A) being employed in a position that pays a wage at least equal to 130 percent of the federal poverty level; and

(B) having financial savings in an amount at least equal to $1,000.

(8) "Supplemental nutrition assistance benefits" means money payments under the supplemental nutrition program operated under Chapter 33.

(9) "Work" means paid private or public sector employment, including a paid apprenticeship.

Sec. 37.002. PURPOSE. The purpose of the pilot program is to assist low-income families in gaining permanent self-sufficiency and eliminating the need for financial assistance, supplemental nutrition assistance, and other means-tested public benefits, notwithstanding the limitations and requirements of Section 31.043.

Sec. 37.003. ESTABLISHMENT OF PILOT PROGRAM. (a) The comptroller, in collaboration with the commission, shall establish and administer the pilot program to provide up to 1,000 families with funding for eligible expenses through individual empowerment accounts.

(b) The program must operate for at least 12 months but not more than 24 months.

Sec. 37.004. TEXAS EMPOWERMENT ACCOUNT PROGRAM FUND. (a) The comptroller shall establish and administer the Texas empowerment account program fund as a dedicated account in the general revenue fund.

(b) The fund consists of:

(1) money appropriated, credited, or transferred to the fund by the legislature;

(2) money appropriated to the fund from federal block grants, including the Temporary Assistance for Needy Families (TANF) block grant and the Title XX Social Services block grant;

(3) gifts, grants, and donations contributed to the fund; and

(4) any other money available for the purposes of the pilot program.

(c) Each quarter, the comptroller may deduct an amount from the Texas empowerment account program fund to cover the comptroller's costs of administering the program. The annual amount deducted may not exceed three percent of the fund for the fiscal year.

(d) Each quarter, the comptroller shall disburse to each family service organization participating in the pilot program an amount from the Texas empowerment account program fund to cover the organization's cost of administering the program. The annual amount disbursed between all of the family service organizations may not exceed five percent of the fund for the fiscal year.

Sec. 37.005. GIFTS, GRANTS, AND DONATIONS. The comptroller may solicit and accept gifts, grants, and donations from any public or private source for any expenses related to the administration of the program, including the initial implementation of the program.

Sec. 37.006. FAMILY ELIGIBILITY. (a) A family is eligible to participate in the pilot program if:

(1) at least one member of the family:

(A) is a recipient of financial assistance;

(B) is at least 18 years of age and not older than 62 years of age;

(C) is willing, physically able, and legally able to work for at least 20 hours per week; and

(D) except as provided by Subsection (b), works at least 20 hours per week;

(2) the family's total household income meets the eligibility requirements for supplemental nutrition assistance benefits; and

(3) the family includes at least one member who is a dependent child and is at least six years of age and not older than 18 years of age.

(b) A program participant may maintain program eligibility for a period of four weeks without meeting the work requirement in Subsection (a)(1)(D).

(c) Income earned and program benefits received by a program participant is included as income for purposes of determining eligibility for any other means-tested public benefits program providing financial assistance.

(d) A program participant is not eligible to receive financial assistance benefits while participating in the pilot program.

(e) A program participant may remain enrolled in the pilot program through the conclusion of the program.

Sec. 37.007. ANNUAL PROGRAM ASSISTANCE AMOUNT. (a) The annual program assistance amount allocated to a program participant is equal to the amount of financial assistance benefits and supplemental nutrition assistance benefits the participant would be eligible to receive if the participant did not participate in the pilot program.

(b) The commission shall provide to the comptroller information on the amount of benefits described by Subsection (a) for each program participant. The comptroller shall use that information to calculate the annual program assistance amount for each program participant.

Sec. 37.008. PROGRAM PARTICIPANT ACCOUNT. (a) The comptroller shall establish for each program participant an account through which program assistance money will be provided to the participant. Money in a program participant's account may be used only for eligible expenses.

(b) The comptroller shall provide each program participant access to a web-based application that enables the participant to monitor the participant's financial activity and improve the participant's financial literacy.

Sec. 37.009. PROGRAM PAYMENT AMOUNT. (a) The comptroller shall allocate to a program participant the annual program assistance amount calculated under Section 37.007 in equal amounts on or before the first days of August, November, February, and May.

(b) Any funds remaining in a program participant's program account at the end of a fiscal year may be carried forward to the next fiscal year or transferred to the participant's private bank account unless another provision of this chapter mandates the closure of the account.

(c) If a family becomes ineligible to participate in the pilot program due to the failure to meet the work requirements under Section 37.006, the comptroller shall:

(1) close the family's program account on the date the family became ineligible; and

(2) return any money remaining in the account to this state for deposit in the Texas empowerment program account.

Sec. 37.010. FAMILY SERVICE ORGANIZATION PARTICIPATION; ELIGIBILITY; CERTIFICATION REQUIRED. (a) The comptroller shall certify eligible organizations as family service organizations for participation in the pilot program.

(b) The comptroller shall:

(1) develop the form and manner for applying for certification as a family service organization; and

(2) post on the comptroller's Internet website an application form for family service organizations.

(c) To be eligible for certification as a family service organization by the comptroller and participate in the pilot program, an organization must be:

(1) exempt from federal tax under Section 501(a), Internal Revenue Code of 1986, by being recognized as an exempt organization in Section 501(c)(3) of that code;

(2) in good standing with this state;

(3) able to administer the pilot program at the participant level, including by:

(A) accepting, processing, and tracking applications for program participation;

(B) approving families for participation in the program; and

(C) providing, either directly or through referral to a partner organization, services to enable program participants to achieve self-sufficiency; and

(4) able to provide personal financial literacy education to program participants that includes information on the importance of the success sequence and how to analyze the participant's financial activity through the web-based application described by Section 37.008(b).

Sec. 37.011. PROGRAM PARTICIPANT APPLICATION. (a) A certified program family service organization shall:

(1) develop an application process for families interested in participating in the pilot program;

(2) make a program application form readily available to potential participants using various means, including by posting the application on the organization's Internet website; and

(3) allow a family to submit a program application to the organization electronically.

(b) A certified program family services organization shall provide to each family who submits an application a document that describes the operation of the pilot program, including:

(1) eligible program expenses;

(2) the organization's expense reporting requirements;

(3) a description of the responsibilities of program participants, including the responsibilities under Section 37.011; and

(4) the role and responsibilities of family service organizations in the program.

Sec. 37.012. PARTICIPATION REQUIREMENTS. (a) A program participant must agree to:

(1) use program money only for eligible or allowed expenses; and

(2) notify the participant's family service organization if the participant is no longer eligible for the program not later than the 30th day after the date of becoming ineligible.

(b) A program participant shall provide to the participant's family service organization any information necessary to verify the participant's continued eligibility for the pilot program.

(c) A program family service organization may not provide services to a program participant if any person in the organization is a participant's immediate family or household member.

Sec. 37.013. FAMILY SERVICE ORGANIZATION DUTIES. (a) A family service organization shall enroll a family in the pilot program if:

(1) the family applies to participate in the program and the organization determines the family meets the program's eligibility requirements; and

(2) the organization has the capacity to provide services to the family.

(b) A family service organization shall create a case plan for a family enrolled in the pilot program through the organization that:

(1) is developed in collaboration with the family;

(2) identifies services the organization will provide to enable the family to achieve self-sufficiency;

(3) clearly defines expectations for the family's participation in the program; and

(4) outlines a pathway and timeline for the family to achieve self-sufficiency.

(c) A family service organization shall annually provide to each program participant the information described by Section 37.011(b). The organization may provide the information electronically.

Sec. 37.014. FAMILY SERVICE ORGANIZATION AUTONOMY; CHALLENGE TO RULE. (a) A family service organization that receives money under the pilot program is not an agent of the state or federal government.

(b) The pilot program does not expand the regulatory authority of this state to impose any additional regulation on a family service organization participating in the program except for regulations that are reasonably necessary to administer the program in accordance with this chapter.

(c) A family service organization participating in the pilot program may not be required to modify its creed, practices, or operations to receive money under the program.

(d) In any proceeding challenging a rule adopted by the comptroller or the executive commissioner, the comptroller or executive commissioner has the burden of proof to establish that the rule:

(1) is necessary to implement or administer the program in accordance with this chapter; and

(2) does not impose an undue burden on a program participant or a family service organization that receives or seeks to receive money under the program.

Sec. 37.015. RANDOM AUDITING. (a) The comptroller may contract with a private entity to randomly audit family service organizations participating in the pilot program as necessary to ensure compliance with program requirements.

(b) During an audit conducted under this section, the comptroller or private entity may require that a program participant or family service organization provide information and documentation regarding any payment made from the Texas empowerment account program fund.

(c) A private entity that conducts an audit under this section shall report to the comptroller any violation of this chapter or other relevant law the entity discovers during the audit.

(d) A finding that pilot program money was used for an expense that is not eligible under the program does not affect the validity of any payment made for an eligible expense.

Sec. 37.016. SUSPENSION OF ACCOUNT. (a) If the comptroller determines that a program participant fails to comply with the program requirements or applicable law, the comptroller shall suspend the participant's program account.

(b) On suspension of an account under Subsection (a), the comptroller shall provide written notice to the program participant and the participant's family service organization that the account has been suspended and no further payments may be made from the account. The notice must specify the grounds for the suspension and state that the program participant must respond to the notice and take any corrective action required by the comptroller not later than the 10th business day after the date of receiving the notice.

(c) On the expiration of the 10-day period under Subsection (b), the comptroller shall:

(1) order permanent closure of the suspended account and declare the participant ineligible for the program;

(2) order temporary reinstatement of the account, conditioned on the performance of a specified action by the participant; or

(3) order full reinstatement of the account.

(d) The comptroller may recover money distributed under the program that was used for ineligible expenses from the program participant or the family service organization that received the money if the participant's account is suspended or closed under this section.

Sec. 37.017. REFERRAL TO ATTORNEY GENERAL. (a) On receipt of evidence of the fraudulent use of an account, the comptroller or a family service organization may refer the case to the attorney general for investigation.

(b) With the consent of the appropriate local county or district attorney, the attorney general has concurrent jurisdiction with the consenting local prosecutor to prosecute an offense referred to the attorney general under Subsection (a).

Sec. 37.018. DATA COLLECTION. (a) The comptroller shall collect the following information at the time the pilot program begins operating, on a quarterly basis while the program is operating, and at the conclusion of the program:

(1) taxpayer revenue spent per program participant;

(2) state money appropriated per program;

(3) federal money received per program;

(4) the number of recipients enrolled in or otherwise receiving benefits under each program;

(5) aggregate demographic and socioeconomic information on recipients under each program including information relating to:

(A) the age, race or ethnicity, and gender of recipients;

(B) the highest level of education completed by recipients;

(C) whether the recipients reside in an urban or rural area of the state;

(D) the average household income of recipients under each program;

(E) the employment status of recipients or, if recipients are dependents, of the parents or guardians of recipients under each program;

(F) the number of hours per week worked by recipients;

(G) the marital status of recipients or, if recipients are dependents, of the parents or guardians of recipients under each program;

(H) the average number of dependents in recipient households under each program;

(I) other safety net benefits or government provided subsidies received by recipients;

(J) duplicative services and administrative activities among programs;

(K) the percentage of state money appropriated to each program that is directly spent on providing benefits to recipients under the program and the percentage that is spent on staff and other administrative costs;

(L) the percentage of recipients who become ineligible for each program because the recipient no longer meets the income eligibility requirements; and

(M) the average length of time between an initial application for benefits and approval under each program;

(6) a cost-benefit analysis that compares the costs of providing each program with the program's effectiveness at transitioning recipients to self-sufficiency; and

(7) a statistical analysis of the data collected under Subdivisions (1) and (2).

(b) Not later than the 10th day following the last day of each calendar quarter during the pilot program's operation, the comptroller shall post on its Internet website outcomes for all program family service organizations during the previous calendar quarter including the information collected under Subsection (a).

Sec. 37.019. STUDY. (a) On conclusion of the pilot program, the comptroller, using existing resources, shall conduct a study on the outcomes of the pilot program based on the information collected under Section 37.018. Using methodological best practices, the comptroller shall compare the outcomes achieved by families who participated in the pilot program with similarly situated individuals who did not participate in the program.

(b) In conducting the study, the comptroller may collect necessary information from a state agency that administers or operates a safety net program or a family service organization that participated in the pilot program. At the request of the comptroller, a state agency or family service organization shall provide the requested information within a reasonable time.

Sec. 37.020. RULES; PROCEDURES. (a) The comptroller and the executive commissioner shall adopt rules and procedures necessary to implement, administer, and enforce this chapter.

(b) A rule adopted under Subsection (a) is binding on an organization that applies for certification as a family service organization and a state or local governmental entity, including a political subdivision of this state, as necessary to implement, administer, and enforce this chapter.

SECTION 2. As soon as practicable after the effective date of this Act, the comptroller of public accounts and the executive commissioner of the Health and Human Services Commission shall adopt rules necessary to implement Chapter 37, Human Resources Code, as added by this Act.

SECTION 3. This Act takes effect immediately if it receives a vote of two-thirds of all the members elected to each house, as provided by Section 39, Article III, Texas Constitution. If this Act does not receive the vote necessary for immediate effect, this Act takes effect September 1, 2023.