GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1997

S	1 

SENATE BILL 1015

Short Title:  Welfare Reform Act of 1997.	(Public)

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Sponsors: Senators Martin of Guilford; Cooper, Dannelly, Gulley, Kerr, Lucas, Phillips, and Wellons.

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Referred to:  Children and Human Resources.

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April 21, 1997

A BILL TO BE ENTITLED
AN ACT TO ESTABLISH THE WELFARE REFORM ACT OF 1997.
The General Assembly of North Carolina enacts:
PART 1.  WORK FIRST PROGRAM.
Section 1.  The title of Part 2 of Article 2 of Chapter 108A of the General Statutes reads as rewritten:
"Part 2. Work First Program."
Section 2.   G.S. 108A-24 reads as rewritten:
"§ 108A-24.  Definitions.
As used in Chapter 108A:
(1)	'Applicant' is any person who requests assistance or on whose behalf assistance is requested.
(1a)	'County department of social services' means a county department of social services, consolidated human services agency, or other local agency designated to administer or provide services pursuant to this Article.
(2)	'Department' is the Department of Human Resources, unless the context clearly indicates otherwise.
	(3a)	'Family' consists of a minor child or children and one or more of their natural parents, adoptive parents, or stepparents living together.
(3b)	'Federal TANF funds' means the Temporary Assistance for Needy Families block grant funds provided for in Title IV-A of the Social Security Act.
(4)	Repealed by Session Laws 1983, c. 14, s. 3.
(5)	'Recipient' is a person to whom, or on whose behalf, assistance is granted under this Article.
(6)	'Resident,' unless otherwise defined by federal regulation, is a person who is living in North Carolina at the time of application with the intent to remain permanently or for an indefinite period; or who is a person who enters North Carolina seeking employment or with a job commitment.
(7)	'Secretary' is the Secretary of Human Resources, unless the context clearly indicates otherwise. 
(8)	'State Plan' is the plan prepared by the Department for the State's Work First Program pursuant to this Article.
(9)	'Title IV-A' means the Social Security Act, 42 U.S.C. § 601, et seq., as amended by the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, P.L. 104-193, and to other provisions of federal law as may apply to services provided in this Article.
(10)	'Work activities' shall include 'federal work activities' and 'State work activities'.
a.	'Federal work activities' are those activities that count toward the State's fulfillment of the work participation rate required by Title IV-A.
b.	'State work activities' are other activities authorized by the Department for receipt of Work First Family Assistance.
(11)	'Work First' is the temporary assistance to needy families program established in this Article.
(12)	'Work First Diversion Assistance' is a short-term cash payment that is intended to produce a substantial reduction in the likelihood of a family requiring Work First Family Assistance.
(13)	'Work First Family Assistance' is a program of time-limited periodic cash payments to assist in maintaining the children of eligible families while the adult family members engage in activities to prepare for entering and to enter the workplace.
(14)	'Work First Services' are services funded from appropriations made pursuant to this Article and designed to facilitate the purposes of the Work First Program.  These services may include eligibility determination, child care, transportation, substance abuse treatment and counseling, education, job placement assistance, employment counseling, prevention of out-of-wedlock births, case management, emergency cash assistance, and other activities designed to help families become self-sufficient."
Section 3.  G.S. 108A-25(a) reads as rewritten:
"(a)	The following programs of public assistance are hereby established, and shall be administered by the county department of social services or the Department of Human Resources under federal regulations or under rules adopted by the Social Services Commission or the Department of Human Resources and under the supervision of the Department of Human Resources:
(1)	Work First Program;
(2)	State-county special assistance for adults;
(3)	Food stamp program;
(4)	Foster care and adoption assistance payments;
(5)	Low income energy assistance program."
Section 4.  G.S. 108A-27 reads as rewritten:
"§ 108A-27.  Authorization of Work First Program.
 (a)	The Department shall establish and supervise the Work First Program to provide temporary assistance to eligible children and families. This program shall be administered by county departments of social services in accordance with:
(1)	This Article;
(2)	The State Plan as defined in G.S. 108A-27.2; and
(3)	Rules adopted pursuant to this Article by the Department or the Social Services Commission.
(b)	The Department shall ensure that the Work First Program is established, supervised, and administered in compliance with federal law.  The Department shall maximize federal receipts for the Work First Program.
(c)	Whenever feasible, the Department shall ensure that as persons and families are moved to self-sufficiency, assistance shall be reduced and ended on a graduated basis rather than ending abruptly upon reaching the time limits established in State law for receiving assistance."
Section 5.  Part 2 of Article 2 of Chapter 108A of the General Statutes is amended by adding the following new sections:
"§ 108A-27.1.  Assistance not an entitlement; State time limit on cash assistance.
(a)	Any assistance programs established under this Article are not entitlements, and nothing in this Article shall create any property right.
(b)	Unless an extension or an exemption is provided pursuant to the provisions of the State Plan, any cash assistance under this Article that is provided to a person or a family in the employment program shall only be provided for a cumulative total of 24 months.  After having received cash assistance for 24 months, the person or the family may reapply for cash assistance, but not until after 36 months from the last month the person or the family received cash assistance.  This subsection does not apply to child-only cases.
"§ 108A-27.2.  Purpose; program description.
(a)	The purpose of the Work First Program is to provide short-term assistance in the form of cash and services to help persons and families move from public assistance to self-sufficiency through gainful employment.
(b)	The Work First Program shall include program administration and three categories of assistance to participants:
(1)	Work First Family Assistance;
(2)	Work First Diversion Assistance; and
(3)	Work First Services.
(c)	Work First Family Assistance may be paid to eligible families or as 'child-only' benefits, as established in the State Plan, based on availability of funds, State and federal law, and Work First Program objectives.
(d)	The Department may distinguish among potential groups of recipients on whatever basis necessary to enhance program purposes and to maximize federal revenues so long as the rights, including the constitutional rights of equal protection and due process, of individuals are protected.  The Department may, however, deny benefits to legal immigrants only to the extent benefits are denied by federal law.
"§ 108A-27.3.  Duties of Department.
(a)	The Department shall supervise the Work First Program.  In supervising the Work First Program, the Department shall have the following duties:
(1)	Prepare the State Plan in accordance with G.S. 108A-27.5 to submit to the General Assembly each fiscal year;
(2)	Prepare and submit the State Plan to the Governor for signature, approval, and forwarding to federal officials as required by federal law or regulation;
(3)	Establish the requirements for content and a schedule for submission by counties of local block grant plans for Work First and review and approve the block grant plans submitted by the counties;
(4)	Advise and assist the Social Services Commission in adopting rules necessary to implement the provisions of this Article;
(5)	Supervise disbursement of local block grant funds to counties for Work First Diversion Assistance and Work First Services;
(6)	Make payments of Work First Family Assistance and Work First Diversion Assistance;
(7)	Establish outcome and performance goals based on economic factors and conditions for determining the performance of State and county agencies in the Work First Program and considering the well-being of children;
(8)	Enter into Memoranda of Agreement with the county departments of social services in accordance with G.S. 108A-27.11;
(9)	Coordinate activities of other State and county agencies in meeting the goals of the Work First Program;
(10)	Work with State and county agencies and with private sector organizations and individuals to develop programs and methods to meet the goals of the Work First Program;
(11)	Monitor and evaluate the impact of the Work First Program on children and families, including the impact of the Program on the economic security and health of children and families, child abuse and neglect, school attendance, and academic and behavioral performance; and
(12)	Monitor the performance of counties in the Work First Program.
(b)	The Secretary may adopt temporary rules in accordance with the procedures of G.S. 150B-21.1 in order to:
(1)	Implement provisions of the State Plan;
(2)	Maximize federal revenues to prevent the loss of federal funds;
(3)	Reduce State and county expenditures in current budgets;
(4)	Enhance the ability of the Department to prevent fraud and abuse in the Work First Program;
(5)	Modify the State Plan as necessary to meet changed circumstances after approval of the State Plan; and
(6)	Respond to any of the circumstances enumerated in G.S. 150B-21.1.
(c)	The Social Services Commission may adopt rules when necessary to implement the provisions of this Article.
(d)	The Secretary may adopt rules when necessary to implement the provisions of the State Plan.
(e)	The Secretary may delegate any portion of the Secretary's rule-making authority under this Article to the Social Services Commission.
"§ 108A-27.4.  Duties of county departments of social services.
(a)	Except as otherwise provided in this Article, the Work First Program shall be administered by the county departments of social services.  The county departments of social services shall:
(1)	Determine eligibility of persons and families for the Work First Program;
(2)	Enter into Personal Responsibility Contracts with participants pursuant to the State Plan and ensure that the services and resources that are needed to assist participants to comply with their obligations under their Personal Responsibility Contracts are available;
(3)	Comply with State and federal law relating to Work First and Title IV-A;
(4)	Develop the local block grant plans for submission by the counties to the Department;
(5)	Enter into and comply with Memoranda of Agreement in accordance with G.S. 108A-27.11;
(6)	Ensure that participants engage in the minimum hours of work activities required by the State Plan and Title IV-A; and
(7)	Ensure that the components of the Work First Program are funded solely from authorized sources and that federal TANF funds are used only for purposes and programs authorized by federal and State law.
(b)	With prior approval of the Department, a county department of social services may delegate any of its duties under this Article to another public agency or private contractor.  Prior to delegating any duty, a county department of social services shall submit its proposed delegation to the Department as the Department may provide.  Notwithstanding any delegation of duty, a county department of social services shall remain accountable for its duties under the Work First Program.
"§ 108A-27.5.  State Plan.
(a)	The Department shall prepare and submit to the General Assembly for its review and approval every fiscal year, in accordance with the procedures established in G.S. 143-16.1 for federal block grant funds, a State Plan that proposes the terms of the Work First Program.  Prior to submitting a State Plan to the General Assembly, the Department shall consult with local governments and private sector organizations regarding the design of the State Plan and allow 45 days to receive comments from them.  The State Plan shall include:
(1)	Benefit levels, limitations, and payments and the method for calculating benefit levels and payments;
(2)	Eligibility criteria, including asset and income standards;
(3)	A description of eligible federal and State work activities and work activity requirements for recipients and any exceptions or exemptions proposed to those requirements;
(4)	Provisions for when extensions may be granted to a person or family who reaches the time limit for receipt of benefits;
(5)	Requirements for assignment of child support income and compliance with child support enforcement activities;
(6)	Provisions for exceptions and exemptions to criteria, time limits, and standards;
(7)	Provisions for sanctions for recipient failure to comply with program requirements;
(8)	Terms and conditions for repayment of Work First Diversion Assistance by recipients who subsequently receive Work First Family Assistance;
(9)	Allocations of federal, State, and county funds for the Work First Program, including block grants to the counties for Work First Diversion Assistance and Work First Services;
(10)	Levels of State and county funding for the Work First Program;
(11)	Allocation for funding for administration at the State and local level not to exceed the federally established limitations on use of federal TANF funds for program administration;
(12)	A description of the Department's consultation with local governments and private sector organizations and a summary of any comments received during the 45-day public comment period; and
(13)	Anything required by federal law to be included in the State Plan.
(b)	In addition to those items required to be included pursuant to subsection (a) of this section, the State Plan may include proposals to establish the following:
(1)	Demonstration projects in one or more counties to assess the value of any proposed changes in State policy or to test ways to improve programs;
(2)	Individual Development Accounts as authorized by Title IV-A;
(3)	Automatic Medicaid eligibility or Medicaid benefit expansion for Work First Program participants;
(4)	Incentives for high-performing counties, contingency plans for counties unable to meet financial commitments during the term of the State Plan, and sanctions against counties failing to meet performance expectations, including allocation of any federal penalties that may be assessed against the State as a result of a county's failure to perform.
(c)	The State Plan may provide that in cases where benefits are paid only for a child, the case is considered a family case.
(d)	The State Plan may provide that recipients shall be required to enter into and comply with Personal Responsibility Contracts as a condition of receiving benefits.  If provided for in the State Plan, the terms and conditions of Personal Responsibility Contracts shall be consistent with program purposes, federal law, and availability of funds.
"§ 108A-27.6.  Work First Family Assistance; program changes.
The Department may change the Work First Family Assistance Program when required to comply with federal law.  Any changes in federal law that necessitate a change in the Work First Program shall be effected by temporary rule until the next State Plan is approved by the General Assembly.  Any change effected by the Department to comply with federal law shall be included in the State Plan submitted during the next session of the General Assembly following the change.
"§ 108A-27.7.  Exemption from federal limitations for individuals convicted of certain drug-related felonies.
Individuals described in section 115 of The Personal Responsibility and Work Opportunity Reconciliation Act of 1996, P.L. 104-193 and convicted of a Category E, F, G, H, or I controlled substances felony offense after August 22, 1996, shall be eligible for both Work First and the food stamp program in this State six-months after the individual is released from custody, if the individual has committed no additional criminal controlled substances offenses during the six-month period and has participated in and successfully completed any substance abuse treatment or counseling program determined by the county department of social services to be needed or appropriate.  A county department of social services may, and is encouraged to, where appropriate, require substance abuse treatment as a condition for receiving benefits.
"§ 108A-27.8.  Work First Program funding.
(a)	The Department shall provide in its State Plan a formula for determining the amount of local block grants.
(b)	Counties shall be reimbursed for Work First Family Assistance by the Department, subject to the availability of federal, State, and county funds and appropriations by the General Assembly.
(c)	Work First Diversion Assistance and Work First Services shall be funded through federal funds, county funds, and the county block grant from the State pursuant to the State Plan.
"§ 108A-27.9.  Maintenance of effort.
(a)	Counties shall maintain one hundred percent (100%) maintenance of effort, as defined in the State Plan or by rule, in funding the Work First Program.  Maintenance of effort shall be measured with reference to a base year defined in the State Plan.
(b)	The Department shall define in the State Plan or by rule the term 'maintenance of effort' based on that term as defined in Title IV-A and shall provide to counties a list of activities that qualify for maintenance of effort requirements.
(c)	If a county fails to comply with the maintenance of effort requirement in subsection (a) of this section, the Director of the Budget may withhold State moneys appropriated to the county pursuant to G.S. 108A-93.
"§ 108A-27.10.  County block grants; Memoranda of Agreement.
(a)	Each county shall submit annually to the Department for approval a local block grant plan that describes the Work First Diversion Assistance and Work First Services the county proposes to offer.
(b)	Prior to submitting its local block grant plan to the Department, a county shall provide the public with an opportunity to review and comment upon its local block grant plan.
(c)	A county local block grant plan shall include a description of how the county will:
(1)	Utilize both public and private resources to assist in moving persons and families to self-sufficiency; and
(2)	Address the needs of persons and families in areas specified by the Department, including transportation, housing, child care, and skills training.
(d)	The local block grant plan shall also include a description of the county's priorities for serving families who need child care based on the needs of the community and the availability of services and funding.
(e)	The local block grant plan shall be adopted by the county commissioners prior to its submission to the State.
(f)	After the county submits its local block grant plan to the Department, the Department and the county shall agree upon the block grant plan by entering into a Memorandum of Agreement (MOA).  The MOA shall include:
(1)	The amount and any limitations or conditions on the use of funds under the local block grant, including disposition of any remaining funds at the end of the fiscal year;
(2)	Outcome measures for determining the success of the Work First Program at the county level; and
(3)	Any provision necessary to ensure proper operation of the Work First Program pursuant to federal law and to this Article.
In addition, the MOA may provide for Department accreditation of county programs, Departmental technical assistance to counties, and for other monitoring and performance enhancement techniques.
"§ 108A-27.11.  Performance standards; corrective action.
(a)	The Department shall establish acceptable levels of performance by counties in meeting Work First expectations, measured by outcome and performance goals contained in the State Plan or in the MOA.  Economic factors and conditions and the well-being of children shall be considered in establishing the goals.
(b)	The Department shall establish monitoring mechanisms and reporting requirements to measure the goals.
(c)	When a county fails to meet acceptable levels of performance, the Department may take one or more of the following actions to assist the county in meeting its Work First goals:
(1)	Notify the county of the deficiencies and add additional monitoring and reporting requirements.
(2)	Require the county to develop and submit for approval by the Department a corrective action plan.
If a county fails to meet acceptable levels of performance for two consecutive years, or fails to comply with a corrective action plan developed pursuant to this section, the Department may assume control of the county's Work First Program, appoint an administrator to administer the county's Work First Program, and exercise the powers assumed to administer the Work First Program either directly or through contract with private or public agencies.  County funding shall continue at levels established by the State Plan when the State has assumed control of a county Work First Program.  At no time after the State has assumed this control shall a county withdraw funds previously obligated or appropriated to the Work First Program.
"§ 108A-27.12.  Appeals.
The Work First Program is a program of public assistance for purpose of an appeal under G.S. 108A-79."
Section 6.  G.S. 108A-29 reads as rewritten:
"§ 108A-29.  Preference for employment services.
	(b)	Members of families with dependent children and with aggregate family income at or below the level required for eligibility for Work First Family Assistance, regardless of whether or not they have applied for such assistance, shall be given priority in obtaining employment services including training and public service employment provided by or through State agencies or with funds which are allocated to the State of North Carolina directly or indirectly through prime sponsors or otherwise for the purpose of employment of unemployed persons.
(c)	[Repealed.]"
Section 6.1.  G.S. 108A-35 reads as rewritten:
"§ 108A-35.  Removal to another county.
Any recipient who moves from one county to another county of this State shall continue to receive public assistance if eligible. The county director in the county from which he has moved shall transfer all necessary records relating to the recipient to the county director of the county to which the recipient has moved. "
Section 7.  G.S. 108A-38 reads as rewritten:
"§ 108A-38.  Protective and vendor payments.
When necessary to comply with any present or future federal law or regulation in order to obtain federal participation in public assistance payments, the payments may be made direct to vendors to reimburse them for goods and services provided the applicants or recipients, and may be made to protective payees who shall act for the applicant or recipient for receiving and managing assistance. Payments to vendors and protective payees shall be made to the extent provided in, and in accordance with, rules and regulations of the Social Services Commission or the Department, which rules and regulations shall be subject to applicable federal laws and regulations."
Section 8.  G.S. 108A-49(a) reads as rewritten:
"(a)	Benefits in the form of foster care assistance shall be granted in accordance with the rules and regulations of the Social Services Commission to any dependent child who would have been eligible to receive Aid to Families with Dependent Children (as that program was in effect on June 1, 1995), but for his or her removal from the home of a specified relative for placement in a foster care facility; provided, that the child's placement and care is the responsibility of a county department of social services."
Section 9.  G.S. 108A-58 reads as rewritten:
"§ 108A-58.  Transfer of property for purposes of qualifying for medical assistance; periods of ineligibility.
(a)	Any person, otherwise eligible, who, either while receiving medical assistance benefits or within one year prior to the date of applying for medical assistance benefits, unless some other time period is mandated by controlling federal law, sells, gives, assigns or transfers countable real or personal property or an interest in real or personal property for the purpose of retaining or establishing eligibility for medical assistance benefits, shall be ineligible to receive medical assistance benefits as set forth in subsection (c) of this section.
Countable real and personal property includes real property, excluding a homesite, intangible personal property, nonessential motor and recreational vehicles, nonincome producing business equipment, boats and motors. The provisions of this act shall not apply to the sale, gift, assignment or transfer of real or personal property if and to the extent that the person applying for medical assistance would have been eligible for such assistance notwithstanding ownership of such property or an interest therein.
(b)	Any sale, gift, assignment or transfer of real or personal property or an interest in real or personal property, as provided in subsection (a) of this section, shall be presumed to have been made for the purpose of retaining or establishing eligibility for medical assistance benefits unless the person, or the person's legal representative, who sells, gives, assigns or transfers the property or interest, receives valuable consideration at least equal to the fair market value, less encumbrances, of the property or interest.
(c)	Any person who sells, gives, assigns or transfers real or personal property or an interest in real or personal property for the purpose of retaining or establishing eligibility for medical assistance benefits, as provided in subsection (a) of this section, shall, after the time of transfer, be ineligible to receive these benefits until an amount equal to the uncompensated value of the property or interest has been expended by or on behalf of the person for the person's maintenance and support, including medical expenses, paid or incurred, or shall be ineligible in accordance with the following schedule, whichever is sooner:
(1)	For uncompensated value of at least one thousand dollars ($1,000) but not more than six thousand dollars ($6,000), a one-year period of ineligibility from date of sale, gift, assignment or transfer;
(2)	For uncompensated value of more than six thousand dollars ($6,000) but not more than twelve thousand dollars ($12,000), a two-year period of ineligibility from date of sale, gift, assignment or transfer;
(3)	For uncompensated value of more than twelve thousand dollars ($12,000), a two-year period of ineligibility from date of sale, gift, assignment or transfer, plus one additional month of ineligibility for each five hundred dollar ($500.00) increment or portion thereof by which the uncompensated value exceeds twelve thousand dollars ($12,000), but in no event to exceed three years.
(d)	The sale, gift, assignment or transfer for a consideration less than fair market value, less encumbrances, of any tangible personal property which was acquired with the proceeds of sale, assignment or transfer of real or intangible personal property described in subsection (a) of this section or in exchange for such real or intangible personal property shall be presumed to have been for the purpose of evading the provisions of this section if the acquisition and sale, gift, assignment or transfer of the tangible personal property is by or on behalf of a person receiving medical assistance or within one year of making application for such assistance and the consequences of the sale, gift, assignment of transfer of such tangible personal property shall be determined under the provisions of subsections (c), (f) and (g) of this section.
(e)	The presumptions created by subsections (b) and (d) may be overcome if the person receiving or applying for medical assistance, or the person's legal representative, establishes by the greater weight of the evidence that the sale, gift, assignment or transfer was exclusively for some purpose other than retaining or establishing eligibility for medical assistance benefits.
(f)	For the purpose of establishing uncompensated value under subsection (c), the value of property or an interest therein shall be the fair market value of the property or interest at the time of the sale, gift, assignment or transfer, less the amount of compensation, if any, received for the property or interest. There shall be a rebuttable presumption that the fair market value of real property is the most recent property tax value of the property, as ascertained according to Subchapter II of Chapter 105 of the General Statutes. Fair market value for purpose of this subsection shall be such value, determined as above set out, less any legally enforceable encumbrances to which the property is subject.
(g)	In the event that there is more than one sale, gift, assignment or transfer of property or an interest therein by a person receiving medical assistance or within one year of the date of an application for medical assistance, unless some other time period is mandated by controlling federal law, the uncompensated value, for the purposes of subsection (c), shall be the aggregate uncompensated value of all sales, gifts, assignments and transfers. The date which is the midpoint between the date of the first and last sale, gift, assignment or transfer shall be the date from which the period of ineligibility shall be determined under subsection (c).
(h)	This section shall not apply to applicants for or recipients of Work First Family Assistance or to persons entitled to medical assistance by virtue of their eligibility for Work First Family Assistance.
(i)	This section shall apply only to transfers made before July 1, 1988."
Section 10.  G.S. 108A-80 reads as rewritten:
"§ 108A-80.  Confidentiality of records.
(a)	Except as provided in (b) below, it shall be unlawful for any person to obtain, disclose or use, or to authorize, permit, or acquiesce in the use of any list of names or other information concerning persons applying for or receiving public assistance or social services that may be directly or indirectly derived from the records, files or communications of the Department or the county boards of social services, or county departments of social services or acquired in the course of performing official duties except for the purposes directly connected with the administration of the programs of public assistance and social services in accordance with federal law, rules and regulations, and the rules and regulations of the Social Services Commission or the Department.
(b)	The Department shall furnish a copy of the recipient check register monthly to each county auditor showing a complete list of all recipients of Work First Family Assistance and State-County Special Assistance for Adults, their addresses, and the amounts of the monthly grants.  This register shall be a public record open to public inspection during the regular office hours of the county auditor, but said register or the information contained therein may not be used for any commercial or political purpose.  Any violation of this section shall constitute a Class 1 misdemeanor.
(c)	Any listing of recipients of benefits under any public assistance or social services program compiled by or used for official purposes by a county board of social services or a county department of social services shall not be used as a mailing list for political purposes.  This prohibition shall apply to any list of recipients of benefits of any federal, State, county or mixed public assistance or social services program.  Further, this prohibition shall apply to the use of such listing by any person, organization, corporation, or business, including but not limited to public officers or employees of federal, State, county, or other local governments, as a mailing list for political purposes.  Any violation of this section shall be punishable as a Class 1 misdemeanor.
(d)	The Social Services Commission shall have the authority to adopt rules and regulations governing access to case files for social services and public assistance programs, except the Medical Assistance Program.  The Secretary of the Department of Human Resources shall have the authority to adopt rules and regulations governing access to medical assistance case files."
Section 11. G.S. 108A-28, 108A-28.1, 108A-30, 108A-31,  108A-32, 108A-33, 108A-34, and 108A-39.1 are repealed.
PART 2.  STATUTORY TECHNICAL AND CONFORMING CHANGES.
Section 12.  G.S. 1-110(a) reads as rewritten:
"(a)	Subject to the provisions of subsection (b) of this section with respect to prison inmates, any superior or district court judge or clerk of the superior court may authorize a person to sue as an indigent in their respective courts when the person makes affidavit that he or she is unable to advance the required court costs. The clerk of superior court shall authorize a person to sue as an indigent if the person makes the required affidavit and meets one or more of the following criteria:
(1)	Receives food stamps.
(2)	Receives Work First Family Assistance.
(3)	Receives Supplemental Security Income (SSI).
(4)	Is represented by a legal services organization that has as its primary purpose the furnishing of legal services to indigent persons.
(5)	Is represented by private counsel working on the behalf of or under the auspices of a legal services organization under subdivision (4) of this section.
(6)	Is seeking to obtain a domestic violence protective order pursuant to G.S. 50B-2.
A superior or district court judge or clerk of superior court may authorize a person who does not meet one or more of these criteria to sue as an indigent if the person is unable to advance the required court costs. The court to which the summons is returnable may dismiss the case and charge the court costs to the person suing as an indigent if the allegations contained in the affidavit are determined to be untrue or if the court is satisfied that the action is frivolous or malicious."
Section 13.  G.S. 15-155.1 reads as rewritten:
"§ 15-155.1.  Reports to district attorneys of aid to dependent children and out-of-wedlock births.
The Department of Human Resources, by and through the Secretary of Human Resources, shall promptly after June 19, 1959, make a report to each district attorney, setting out the names and addresses of all mothers who reside in his prosecutorial district as defined in G.S. 7A-60 and are recipients of assistance under the provisions of Part 2, Article 2, Chapter 108A of the General Statutes. Such report shall in some manner show the identity of the unwed mothers and shall set forth the number of children born to each said mother. Such a report shall also be made monthly thereafter setting out the names and addresses of all such mothers who reside in the district and who may have become recipients of aid to dependent children since the date of the last report."
Section 14.  G.S. 15-155.2(a) reads as rewritten:
"(a)	Upon receipt of such reports as are provided for in G.S. 15-155.1, the district attorney of superior court may make an investigation to determine whether the mother of an out-of-wedlock child or who is a recipient of Work First Family Assistance, has abandoned, is willfully neglecting or is refusing to support and maintain the child within the meaning of G.S. 14-326 or 49-2 or is diverting any part of the funds received as Work First Family Assistance to any purpose other than for the support and maintenance of a child in violation of G.S. 108-76.1. In making this investigation the district attorney is authorized to call upon:
(1)	Any county board of social services or the Department of Human Resources for personal, clerical or investigative assistance and for access to any records kept by either such board and relating to the matter under investigation and such boards are hereby directed to assist in all investigations hereunder and to furnish all records relating thereto when so requested by the district attorney;
(2)	The board of county commissioners of any county within his district for legal or clerical assistance in making any investigation or investigations in such county and such boards are hereby authorized to furnish such assistance in their discretion; and
(3)	The district attorney of any inferior court in his district for personal assistance in making any investigation or investigations in the county in which the court is located and any district attorney so called upon is hereby authorized to furnish such assistance by and with the consent of the board of county commissioners of the county in which the court is located, which board shall provide and fix his compensation for assistance furnished."
Section 15.  G.S. 95-25.3(d) reads as rewritten:
"(d)	The Commissioner, in order to prevent curtailment of opportunities for employment of the economically disadvantaged and the unemployed, may, by regulation, establish a wage rate not less than eighty-five percent (85%) of the otherwise applicable wage rate in effect under subsection (a) which shall apply to all persons (i) who have been unemployed for at least 15 weeks and who are economically disadvantaged, or (ii) who are, or whose families are, receiving Work First Family Assistance or who are receiving supplemental security benefits under Title XVI of the Social Security Act.
Pursuant to regulations issued by the Commissioner, certificates establishing eligibility for such subminimum wage shall be issued by the Employment Security Commission.
The regulation issued by the Commissioner shall not permit employment at the subminimum rate for a period in excess of 52 weeks."
Section 16.  G.S. 105A-2(1) reads as rewritten:
"(1)	'Claimant agency' means and includes:
a.	The State Education Assistance Authority as enabled by Article 23 of Chapter 116 of the General Statutes;
b.	The North Carolina Department of Human Resources when in the exercise of its authority to collect health profession student loans made pursuant to G.S. 131-121;
c.	The North Carolina Department of Human Resources when in the performance of its duties under the Medical Assistance Program enabled by Chapter 108A, Article 2, Part 6, and any county operating the same Program at the local level, when and only to the extent such a county is in the performance of Medical Assistance Program collection functions;
d.	The North Carolina Department of Human Resources when in the performance of its duties, under the Child Support Enforcement Program as enabled by Chapter 110, Article 9 and Title IV, Part D of the Social Security Act to obtain indemnification for past paid public assistance or to collect child support arrearages owed to an individual receiving program services and any county operating the program at the local level, when and only to the extent that the county is engaged in the performance of those same duties;
e.	The University of North Carolina, including its constituent institutions as specified by G.S. 116-2(4);
f.	The University of North Carolina Hospitals at Chapel Hill in the conduct of its financial affairs and operations pursuant to G.S. 116-37;
g.	The Board of Governors of the University of North Carolina and the State Board of Education through the College Scholarship Loan Committee when in the performance of its duties of administering the Scholarship Loan Fund for Prospective College Teachers enabled by Chapter 116, Article 5;
h.	The Office of the North Carolina Attorney General on behalf of any State agency when the claim has been reduced to a judgment;
i.	The State Board of Community Colleges through community colleges as enabled by Chapter 115D in the conduct of their financial affairs and operations;
j.	State facilities as listed in G.S. 122C-181(a), School for the Deaf at Morganton, North Carolina Sanatorium at McCain, Western Carolina Sanatorium at Black Mountain, Eastern North Carolina Sanatorium at Wilson, and Gravely Sanatorium at Chapel Hill under Chapter 143, Article 7; Governor Morehead School under Chapter 115, Article 40; Central North Carolina School for the Deaf under Chapter 115, Article 41; Wright School for Treatment and Education of Emotionally Disturbed Children under Chapter 122C; and these same institutions by any other names by which they may be known in the future;
k.	The North Carolina Department of Revenue;
l.	The Administrative Office of the Courts;
m.	The Division of Forest Resources of the Department of Environment, Health, and Natural Resources;
n.	The Administrator of the Teachers' and State Employees' Comprehensive Major Medical Plan, established in Article 3 of General Statutes Chapter 135;
o.	The State Board of Education through the Superintendent of Public Instruction when in the performance of his duties of administering the Scholarship Loan Fund for Prospective Teachers enabled by Chapter 115C, Article 32A and the scholarship loan and grant programs enabled by Chapter 115C, Article 24C, Part 1;
p.	The Board of Trustees of the Teachers' and State Employees' Retirement System and the Board of Trustees of the Local Governmental Employees' Retirement System in the performance of their duties pursuant to Chapters 120, 128, 135 and 143 of the General Statutes;
q.	The North Carolina Teaching Fellows Commission in the performance of its duties pursuant to Chapter 115C, Article 24C, Part 2;
r.	The North Carolina Department of Human Resources when in the performance of its collection duties for intentional program violations and violations due to inadvertent household error under the Food Stamp Program enabled by Chapter 108A, Article 2, Part 5, and any county operating the same Program at the local level, when and only to the extent such a county is in the performance of Food Stamp Program collection functions.
		The North Carolina Department of Human Resources when, in the performance of its duties under the Work First Program provided in Part 2 of Article 2 of Chapter 108A, or under the State-County Special Assistance for Adults Program provided in Part 3 of Article 2 of Chapter 108A, it seeks to collect public assistance payments obtained through an intentional false statement, intentional misrepresentation, intentional failure to disclose a material fact, or inadvertent household error;
s.	The Employment Security Commission of North Carolina.
t.	Any State agency in the collection of salary overpayments from former employees.
u.	The State Board of Education through the Superintendent of Public Instruction when in the performance of his duties of administering the program under which the State encourages participation in the National Board for Professional Teaching Standards (NBPTS) Program, enabled by Section 19.28 of Chapter 769 of the 1993 Session Laws."
Section 17.  G.S. 110-129(6) reads as rewritten:
"(6)	'Disposable income' means any form of periodic payment to an individual, regardless of sources, including but not limited to wages, salary, commission, self-employment income, bonus pay, severance pay, sick pay, incentive pay, vacation pay, compensation as an independent contractor, worker's compensation, unemployment compensation benefits, disability, annuity, survivor's benefits, pension and retirement benefits, interest, dividends, rents, royalties, trust income and other similar payments, which remain after the deduction of amounts for federal, State, and local taxes, Social Security, and involuntary retirement contributions. However, Supplemental Security Income, Work First Family Assistance, and other public assistance payments shall be excluded from disposable income. For employers, disposable income means 'wage' as it is defined by G.S. 95-25.2(16). Unemployment compensation benefits shall be treated as disposable income only for the purposes of income withholding under the provisions of G.S. 110-136.4, and the amount withheld shall not exceed twenty-five percent (25%) of the unemployment compensation benefits."
Section 18.  G.S. 110-130.1 reads as rewritten:
"§ 110-130.1.  Non-Work First services.
(a)	All child support collection and paternity determination services provided under this Article to recipients of public assistance shall be made available to any individual not receiving public assistance in accordance with federal law and as contractually authorized by the nonrecipient, upon proper application and payment of a nonrefundable application fee of ten dollars ($10.00).
(b)	Repealed by Session Laws 1989, c. 490.
(b1)	In cases in which a public assistance debt which accrued pursuant to G.S. 110-135 remains unrecovered, support payments shall be transmitted to the Department of Human Resources for appropriate distribution. When services are terminated and all costs and any public assistance debts have been satisfied, the support payment shall be redirected to the client.
(c)	Actions or proceedings to establish, enforce, or modify a duty of support or establish paternity as initiated under this Article shall be brought in the name of the county or State agency on behalf of the public assistance recipient or nonrecipient client. Collateral disputes between a custodial parent and noncustodial parent, involving visitation, custody and similar issues, shall be considered only in separate proceedings from actions initiated under this Article. The attorney representing the designated representative of programs under Title IV-D of the Social Security Act shall be deemed attorney of record only for proceedings under this Article, and not for the separate proceedings. No attorney/client relationship shall be considered to have been created between the attorney who represents the child support enforcement agency and any person by virtue of the action of the attorney in providing the services required.
(c1)	The Department is hereby authorized to use the electronic and print media in attempting to locate absent and deserting parents. Due diligence must be taken to ensure that the information used is accurate or has been verified. Print media shall be under no obligation or duty, except that of good faith, to anyone to verify the correctness of any information furnished to it by the Department or county departments of social services.
(d)	Any fee imposed by the North Carolina Department of Revenue or the Secretary of the Treasury to cover their costs of withholding for non-Work First arrearages certified for the collection of past due support from State or federal income tax refunds shall be borne by the client by deducting the fee from the amount collected.
Any income tax refund offset amounts which are subsequently determined to have been incorrectly withheld and distributed to a client, and which must be refunded by the State to a responsible parent or the nondebtor spouse, shall constitute a debt to the State owed by the client."
Section 19.  G.S. 111-21 reads as rewritten:
"§ 111-21.  Disqualifications for relief.
No aid to needy blind persons shall be given under the provisions of this Article to any individual for any period with respect to which he is receiving aid under the laws of North Carolina  providing Work First Family Assistance and/or relief for the aged, and/or aid for the permanently and totally disabled."
Section 20.  G.S. 120-70.71 reads as rewritten:
"§ 120-70.71.  Powers and duties.
The Commission shall study State government policy and programs affecting the family, specifically addressing family issues from the point of existing laws, governmental programs needed or already functioning, and current family life issues.  The Commission shall work in close collaboration with various agencies and programs dealing with the family.  Among the issues the Commission may consider studying are the following:
(1)	The feasibility of establishing model projects that would be located primarily in low-income, high dropout rate communities in North Carolina:
a.	To teach adults in the family to read; and
b.	To provide after school care for school-aged children using volunteers who could be retirees in the provision of services;
(2)	The fiscal impact of a cash stipend created by a tax deduction or by industry dollars to promote literacy or the obtainment of a General Education Development Degree for persons who are presently illiterate or outside the school system;
(3)	The need for day care for children and senior citizens, changes in Work First Family Assistance payments and eligibility requirements, coordination of State law with federal welfare reform programs, in-home services for the elderly, additional funding for adult day care, and incentives for industries to develop day care programs;
(4)	The relationship between the decline of real income and the tax structure, college tax credits, the minimum wage, and welfare support systems;
(5)	The State's efforts in the areas of adolescent pregnancy and teaching about adolescent sexuality;
(6)	A comprehensive review of State and federal programs encouraging business and industry to provide adequate child care for their employees;
(7)	An analysis of what the State is currently doing to encourage North Carolina businesses and industry to provide adequate child care for their employees;
(8)	A survey of North Carolina employers that presently provide child care options for their employees and what types of options they provide;
(9)	A comprehensive study of the types of tax incentives and other incentives that would encourage North Carolina businesses – especially those that have 50 or more employees – to either provide on-site child care facilities or provide other child care options and the cost to the State of these tax incentives;
(10)	Recommendations of what the State could be doing to encourage North Carolina businesses to provide on-site child care facilities or other child care options for their employees;
(11)	Recommendations of a comprehensive policy for North Carolina to encourage businesses within the State to provide on-site child care facilities or other child care options for their employees;
(12)	The concept of requiring coverage of child health supervision services in all health insurance policies sold or delivered within the State;
(13)	The issue of domestic violence; and 
(14)	The problem of suicide among the youth of the State."
Section 21.  The Department shall expand the amount of time a Work First Program participant who becomes employed may receive Medicaid benefits from 12 to 24 months so long as the participant otherwise meets the income eligibility requirements for Medicaid.
Section 22.  Notwithstanding any law to the contrary, the Department of Human Resources may designate a pilot county for the purpose of conducting a demonstration work-study project for Work First Program participants in the county that will provide participants with the option to attend community college paid with Work First funds while continuing to require the participants to meet work requirements.  This pilot shall be funded by the pilot county using the federal and State funding allocated to the pilot county for the Work First Program.  The Department shall evaluate the work-study project and report to the General Assembly on or before March 1, 1999.
Section 23.  This act is effective when it becomes law.