The Personal Responsibility and Work Opportunity Reconciliation Act of 1996. Improvements Over the Vetoed Bill

09/01/1996

President Clinton vetoed the previous welfare reform bill (H.R. 4) submitted by Congress because it did too little to move people into jobs and failed to provide the supports -- like child care and health care -- that families need to move from welfare to work. "The Personal Responsibility and Work Opportunity Reconciliation Act of 1996" includes several improvements over the vetoed bill, including:

o Guaranteed medical coverage.

The new law preserves the national guarantee of health care for poor children, the disabled, pregnant women, the elderly, and people on welfare. H.R. 4 would have ended the guarantee of Medicaid coverage for cash assistance recipients.

o Increased child care funding and mandatory child care maintenance of effort.

The new law provides $14 billion in child care funding -- an increase of $3.5 billion over 6 years -- allowing more mothers to leave welfare for work. States will receive an initial allotment each year from a fund of approximately $1.2 billion. To access additional funds, states must maintain their own spending at 100 percent of their FY 1994 or 1995 spending on child care (whichever is higher). By contrast, H.R. 4 increased child care funding by just $300 million over current law, and did not require states to meet child care maintenance of effort requirements to access additional federal child care funding, allowing states to lower their own spending.

o Incentives for states to move people into jobs.

The new law includes a $1 billion performance bonus to reward states that meet performance targets. H.R. 4 did not contain a cash performance bonus.

o Preservation of nutrition programs.

H.R. 4 would have given states the option of block granting food stamp benefits. The bill would have also capped federal food stamp program expenditures, limiting maximum benefit increases to 2 percent per year, regardless of growth in need for assistance. The new law maintains the national nutritional safety net by eliminating the block grant option as well as the food stamp cap.

o Current law child protection and adoption.

Unlike H.R. 4, the new plan maintains current law on child protection and adoption, and does not reduce funds for child welfare, child abuse, foster care and adoption services.

o Improved contingency fund.

The new law includes a $2 billion contingency fund to protect states in times of population growth or economic downturn. H.R. 4 included a $1 billion contingency fund.

o Current law child care health and safety standards.

The new law protects children by maintaining health and safety standards for day care. H.R. 4 would have eliminated health and safety protections.

o Protection of disabled children. H.R. 4 would have cut SSI by 25 percent for many disabled children. The new law eliminates this proposed two-tier system.

o Optional family cap.

Under the new law, states have the option to implement a family cap. H.R. 4 required states to deny cash benefits to children born to welfare recipients unless the state legislature explicitly voted to provide benefits.

Necessary Improvements

President Clinton has stated that the new law requires several improvements. Specifically, he has pledged to fix two provisions of the welfare bill which he believes have nothing to do with welfare reform.

o Food Stamps.

According to President Clinton, the new law cuts deeper than it should in Food Stamps, mostly for working families who have high shelter costs.

o Legal Immigrants.

The law includes provisions that would deny most forms of public assistance to most legal immigrants for five years or until they attain citizenship. The President has said that legal immigrants who fall on hard times through no fault of their own and need help should get it, although their sponsors should take additional responsibility for them.