Personal Responsibility and Individual Development for Everyone Act - Continued

PERSONAL RESPONSIBILITY AND INDIVIDUAL DEVELOPMENT FOR EVERYONE ACT-CONTINUED

Mr. GRASSLEY. Mr. President, today we begin debate on what the public at large would refer to as a welfare reform bill, a bill that would build upon very major changes that were made after 60 years of the previous welfare legislation that did not accomplish its goals to one now where we have had an opportunity since 1996 to move people from welfare to work.

The public at large and sometimes even I refer to this legislation as welfare reform, but our legislation is entitled "The Personal Responsibility and Individual Development for Everyone Act." If you hear us use the acronym P-R-I-D-E, PRIDE, this is the legislation that is before the Senate. I am very happy that we are finally able to consider this legislation.

Going back to 1996, after years of debate and even after two vetoes by President Clinton, we finally had a Republican Congress pass, and a Democratic President sign, the Personal Responsibility and Work Opportunity Reconciliation Act of 1996. I emphasize that because the issue of welfare is highly charged politically. When you are going to make major changes, as we did in 1996, it takes bipartisanship to accomplish those changes. That bipartisanship was between Democratic President Clinton and a Republican-controlled Congress.

The enactment of welfare reform ended the entitlement aspect of welfare, the cash assistance part of it. The impetus for welfare reform was generated by a number of factors, including public sentiment that the welfare system needed overhauling. When campaigning for President, President Clinton promised, in his words, "to end welfare as we know it." For the Republicans, during the campaign for Congress in 1994 when the Contract With America was the watch word of Republicans, welfare reform was a key part of that. So we had a President promising to end welfare as we know it, we had Republicans putting it in their Contract With America, and, finally, after 2 years, the legislation was passed at that time.

I would categorize the PRIDE legislation as moving on and fine-tuning that basic underlying legislation which has sunset. The sunset was in the 1996 legislation. When legislation sunsets, it must be reenacted by the Congress of the United States or that part of the code goes off the books.

Quite honestly, there are Americans who have needs. There is still need for assistance, but the goal of that assistance is still as it has always been: to move people from welfare to work.
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In the years leading up to the enactment of welfare reform in 1996, the AFDC roles soared and costs increased. From 1988 through 1992, welfare spending increased by billions of dollars. The welfare system was attributed by many to contributing to a culture of isolation and dependence, persisting from one generation to another. Despite dire predictions to the contrary, the reforms in the 1996 act have produced very positive results.

The welfare caseload has dropped dramatically. Between fiscal year 1997 and fiscal year 2002, the average monthly number of welfare recipients fell by 5.8 million or 53 percent of the previous high. Child poverty has also been reduced. Between 1996 and 2001, the national child poverty rate fell by 20 percent. This decline is even more marked for certain groups. We see the African-American children poverty rate dropping from nearly 40 percent to 30 percent, the lowest rate on record.

The Hispanic child poverty rate dropped from just slightly over 40 percent to 28 percent, the largest 5-year drop on record.

Employment rates of adult recipients has increased. In fiscal year 2001, 27 percent of the adult recipients were employed, rising to about 2.4 times the 1996 employment rate of 11 percent.

These reforms all stemmed from a work-first approach that emphasized an adult's attachment to the workforce. I believe we should continue and this legislation does build upon a work-first approach, and yet the need for reform continues.

There are key provisions in the 1996 act which have not yielded the desired results. Additionally, there are further reforms which should be enacted, things that we have learned from the 1996 act, and we are fine-tuning the present legislation through this legislation before us. As an example, the 1996 bill envisions a contingency fund which would provide additional matching grants to needy States during economic downturns.

However, during the recent recession, the first real test of the contingency fund, no State was able to access the contingency fund. This is because States must raise their own spending considerably during a recession to meet the contingency fund State spending requirements.

I am sure it was not the intent of the authors of the 1996 bill to make the contingency fund inaccessible. The PRIDE bill before the Senate includes provisions which would liberalize the contingency fund to make it more accessible to needy States and to help more citizens of their States who have the need.

Another example would be the work participation rate. The 1996 welfare reform bill envisioned a participation rate of 50 percent by 2002. However, because of the way the caseload reduction credit has worked, many States have a marginal or even nonexistent work participation requirement, meaning they are meeting the requirements of existing Federal law without putting one more person from the welfare rolls into the payrolls. The fact that the caseload reduction credit has effectively neutralized the work participation rate requirement is then a fundamental flaw in this 1996 law that PRIDE corrects.

The PRIDE bill does, in fact, correct this by replacing the caseload reduction credit with an employment credit. To ensure that the credit does not undermine the work participation rate, the credit would have a phased-in cap. Many have advocated that there needs to be a stronger message sent to States on the value of education as a means of getting out of poverty. Some have also indicated the need for increased child care funding, as well as needed improvements to child support and enforcement policies.

The PRIDE legislation before the Senate increases opportunities for education, opportunities for training, as well as support for the families by increased funding for child care. Additionally, the PRIDE bill provides child support enhancements with more child support going to families. These reforms are a critical means that help families get off and stay off of welfare.

Two of the four purposes of the 1996 welfare act dealt with strengthening two-parent families. So far, very few States have taken the opportunity to develop and to implement innovative programs and policies to address the issues of healthy two-parent marriages, even though the 1996 law is very flexible on how that is to be done-obviously too flexible from the standpoint of it being a requirement that the State ought to meet.

I strongly support marriage promotion activities as a means of improving child well-being. Let nobody in this body or outside this body say there is anything in this language that has anything to do with forcing people into the institution of marriage. Well short of that, this legislation does and should do things to emphasize the importance of people who are in a married relationship, that they are less apt to be on welfare than families who are single parent.

This legislation provides funding for healthy marriage promotion activities, as well as research, demonstrations and technical assistance to States in developing effective programs. Thus, while the 1996 act made significant reforms, there remains more that should be done to strengthen the current welfare delivery system. Those reforms are included in the PRIDE bill now before the Senate.

Recognizing the improvements that the 1996 reforms made, our Senate Finance Committee began deliberations by working off of current law and improving it with priorities identified by Senators on and off the Finance Committee, as well as ideas that are coming from President Bush's administration.

The Senate Finance Committee deliberations in many ways continued the work done in the 107th Congress on the issues of welfare reform. As Members know, the bill that then-Chairman BAUCUS produced in the second half of the 107th Congress, which went by the acronym WORK bill, was based on the so-called tripartisan agreement at that time. This tripartisan agreement was a series of policy agreements reached by Senators BREAUX, ROCKEFELLER, LINCOLN, and JEFFORDS from the Democratic caucus, and Senators HATCH and SNOWE from the Republican caucus. These Members, along with then-Chairman BAUCUS, continued to play strong and important leadership roles on the Finance Committee relative to welfare reform.

I had a chance to review the work of the last Congress, which was the tripartisan agreement, and I noted similarities between what the tripartisan group proposed, what the PRIDE Act before us has in it, and also the House-passed bill that passed early last year. That House-passed bill is largely based upon President Bush's proposal for welfare reform. I refer my colleagues to the various charts that I am going to put before them now, which highlight the many areas of common ground between last year's WORK bill and the House bill, and the PRIDE bill by which the present title is before the Senate. Admittedly, not all the details are exactly the same, but as my colleagues will see from these charts, there is a great deal of common ground between these three bills. I think it is important to emphasize the similarities because too often on the Senate floor we have emphasis upon disagreements.

This common ground is building upon the bipartisanship that took place in 1996 to move us to the present program.

There is common ground regarding keeping what works from the 1996 reform bill. Going down the chart from top to bottom, all three bills maintain the basic block grant, continue the policy of no individual entitlement to assistance, and retain the lifetime 5-year time limit.

Both the bill of Senator Baucus, of last session, and the legislation now before the Senate would maintain current sanction policy. The PRIDE bill continues to allow for 12 months of education and training, while the House bill scales that back to 4 months and the bill of Senator Baucus would have increased that to 24 months.

Additionally, both the WORK bill and the PRIDE bill would maintain the current list of core work and work readiness activities, although the WORK bill would allow 8 weeks to be spent in job research.

Now we have a chart that deals with improving State flexibility. Before I describe what is on this chart, we have had a great deal of emphasis upon letting States use this Federal legislation with some degree of flexibility. Frankly, it is very difficult for us to pour a mold in Washington called welfare reform and have it fit all 50 States exactly the same way. What it might take for the State of Iowa to meet the needs of a welfare family in Waterloo, IA, might be entirely different than in New York City. If you try to solve it in exactly the same way, you are probably going to waste money in New York or Waterloo or you might not accomplish as much in one city for that money as opposed to another. So let Albany, as the capital of New York, or let Des Moines, IA, as the capital of my State-let the legislators there and administrators there fit this to meet their various needs.
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I want to point, though, to the common ground in terms of improving State flexibility. Again, I am referring to the three proposals: The Senate bill from the last Congress, the Senate bill from this Congress, and the House-passed bill that is now in the Senate for our consideration. All three proposals would allow for adults on assistance, with barriers to work, to engage in activities designed to address those barriers and allow those barrier removal activities to count toward a State work requirement for 3 months, provide for increased access to emergency or contingency funds during an economic downturn, and allow States to use their unobligated balances or carryover funds for any welfare-related purpose. That would include child care, whereas currently States can only use these funds for cash assistance. We give States much more flexibility to meet their needs because they know their needs better than we do.

Both the Senate bill of the 107th Congress as well as the Senate bill of the 108th Congress would allow for an additional 3 months of barrier removal activities if combined with work. Both the WORK bill and the PRIDE bill include a provision allowing States to count longer duration postsecondary education towards their work requirement. This is a provision patterned after the State of Maine's Parents as Scholars Program.

We also have common ground between these three pieces of legislation on strengthening work requirements and leading people into the world of work. For 60 years we put welfare recipients out of sight, out of mind, out to the edges of society, guaranteeing a life of poverty. What we started doing in 1996, and we intend to continue to do through this legislation, is move people from the world of welfare to the world of work. The motivation behind that is you have to be in the world of work to have a chance to move up the economic ladder. You cannot move up the economic ladder in the world of welfare. But where there are 138 million Americans in the world of work, that is where we need to have as many welfare recipients as we can so they can move out of poverty.

No child should be sentenced to a life of poverty, and I think we are showing in the 1996 legislation, which we are now refining, that this helps people move up the economic ladder. At least there is opportunity to move up the economic ladder where there is no opportunity to do that if you are relying on a welfare check.

I want to again emphasize there is common ground relative to strengthening the work requirement. All three bills would increase a State's required participation rate, raise the time spent in core or priority activities, as well as assign partial credit for hours below the standard. The PRIDE bill and the House bill would raise the standard hour. The PRIDE bill and the WORK bill would replace the caseload reduction credit with an employment credit based on legislation introduced by the Senator from Arkansas, Mrs. Lincoln.

There is common ground on promoting healthy families. All three bills would provide for universal engagement of improved child support provisions, healthy marriage grants, as well as for responsible fatherhood grants. Both the WORK and the PRIDE bills would extend transitional medical assistance for 5 years, with program simplification that was authored by Senator Breaux of Louisiana.

It would allow for caregiving for a disabled child to count as work, and would require States to develop presanction review policies.

I have worked very hard to make sure that this is a bipartisan product. I have also been continually mindful of concerns raised by Democratic colleagues that they have about this provision. In areas where we differ, I am more than happy to let the Senate work its will, and there are outstanding issues. There are key differences between last year's Senate Finance Committee bill and this year's Senate Finance Committee bill. In my opinion, the most significant ones are the level of child care funding available for States, about which there is going to be an amendment that we are going to be dealing with shortly. Another one would be 24 months versus 12 months of allowable education and training. Another one would be eligibility for legal immigrants, for welfare, Medicaid, and the children's health insurance program. Another one would be continuation of the expired State aid to families of dependent children waiver; and, fifth, the standard hours for calculating a State's work participation rate.

I am also aware there are Members who may wish to consider provisions increasing the work requirement by broadening the family's account toward the participation rate as well as increasing the standard hour.

Additionally, I have had Members tell me they want to consider amendments requiring States to pose a full check sanction on adults who fail to comply with their self-sufficiency plans.

These are all things to which the Senate is entitled, guaranteed, to have a healthy debate on. These are things that will be settled on the floor of the Senate, if people want to pursue these differences of opinion.

However, at this point I want to spend some time discussing the issues surrounding the work requirement in PRIDE, specifically the issue of work hours for individuals receiving assistance. I want to clarify, first of all, something for the record. There is no Federal hour requirement on an adult receiving assistance.

I want to say that another way.

The Federal Government cannot make an individual welfare recipient work 40 hours or 30 hours or 1 hour. Just as there is no longer an individual entitlement to welfare, there is no individual requirement for work hours. As the great baseball leader Casey Stengel used to say, Look it up.

There is a Federal requirement on the States to engage welfare clients in a variety of meaningful activities in order to meet a Federal work participation rate, and there are severe penalties on States for failure to meet the Federal work participation rate.

Currently, in order for a State to count an adult recipient toward the calculation of that State's work requirement, that adult must be engaged in priority work or work-related activities for at least 30 hours.

As you know, the majority of families receiving welfare don't want to be on welfare. A recent study by the Mathematica Policy Research Institute of low-income families in my State revealed that many of those who ask for assistance "felt that it sacrifices their independence and pride to do so."

In hearings as well as in townhall meetings in my State of Iowa, adults receiving assistance told me they desire to work. I took at their word Iowans who spoke to me of their desire to work, and that is why I have worked so hard to bring a bill forward that would encourage States to redouble their efforts to engage adults receiving assistance in meaningful activities and better prepare them to enter the world of work.

Consider the hypothetical case of Sara, a mom with two kids, who finds herself in a crisis. A victim of domestic abuse, Sara is trying to make a better life for herself and her children. To that end, she moves out of her abuser's home and attempts to find a way to support her family. Lacking a number of basic skills as well as needing some counseling to deal with her history of abuse, Sara presents with a number of challenges and needs welfare to help support her family.

Under current law, States have a limited capacity to deal with Sara's issues and have those activities count toward a State work participation rate. Under current law, a State cannot count any domestic violence counseling that may be offered to Sara toward their work participation rate.

Sara knows she must work to support her family, so she begins immediately looking for work. She spends 6 weeks looking for a job and finally finds a part-time job as a waitress working 6 hours a day for 4 days a week. She continues to look for a better paying job for an hour a day as well as spending another hour a day in counseling provided to her by her own State.
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I think many of us would agree that Sara is doing everything she can to try to move toward self-sufficiency and that her State by engaging her in counseling is doing its part as well. However, under current law, because she is only part time and because a State cannot count her job search after 6 weeks, and under current law domestic violence counseling can never count, Sara does not count toward that State's participation rate, regardless of how hard she or the State make the effort for her to be in the work force. In other words, you either meet the 30-hour standard and count or you don't.

Currently, the States report that the majority of adults-57 percent-receiving assistance engage in 0 hours of activity. Clearly, it is more difficult for States to work with adults who are not doing anything than to work with an adult working 29 hours and get her engaged in meaningful activities for another 5 hours.

It can be argued as well that it is more meaningful to help an adult move from 0 to 20 hours of activity than to move an adult from 29 hours to 34 hours of activity; but under current law, a State has no incentive to work with that particular individual. It doesn't give them credit, to the Federal Government, for doing the State's part under the welfare-to-work law requirements

The administration's proposal for welfare reform reauthorization-last year's Senate bill called the WORK bill and this year's PRIDE bill-allows States to get partial credit for hours below that standard hour requirement.

As my colleagues know, the standard hour is when an eligible parent or parents count as "one family" for purposes of calculating a State's work participation rate. Partial credit for hours below the standard would give States a very strong incentive to work with adults who may not be ready for full-time employment. I think we can all agree it is better for these adults to be doing something rather than nothing, languishing on welfare rolls until the time limit kicks in and they have to go off assistance, having no skills to go get a job or skills to support their family.

I have another chart I would like to bring to your attention.

Our PRIDE bill is unique, however, insomuch as the legislation would establish a series of "tiers" where partial credit is assigned along with a band of hours.

For work or work-readiness activities in the 20-23 hour range, a State may claim credit for an adult with a child age 6 or older counting as .675 of an entire family. For hours of 24-29 range, a State may claim credit for an adult counting as .75 of a family. And for hours in the 30-33 range, a State may claim credit for an adult counting as .875 of a family.

The PRIDE bill, consistent with last year's tripartisan proposal, establishes a separate lower standard hour for parents with a child under the age of 6 because of the greater need for attention of that child. However, PRIDE sets a standard hour at 24, whereas the tripartisan proposal would have continued to set the standard hour for a parent with a child under age 6 at 20 hours. States can also capture a modest amount of extra credit for hours above this standard.

As a result of these provisions in the PRIDE Act, the Congressional Research Service has calculated that overall, the nationwide work participation rate for States increases from a national average of 29 percent-without waivers-to 41 percent under our PRIDE legislation.

There are some States that have very low participation rates. I have included a number of provisions specifically intended to help those States. Additionally, I am willing to work with Members representing those States on measures we can take to assist those States in making improvements in the way services are delivered and clients being engaged in those States.

When we talk about the work hours as they relate to the PRIDE bill, I think it is important to bear in mind that the significant hour is not whether it is 34 or 40 or 37, but the significant number of hours is 20 because that is where the partial credit begins.

Additionally, when we talk about the hours in the work requirement, the important hour again is not 30 or 40, but the important hour is 24 because that is the threshold for core work activities.

Once a client meets the 24-hour threshold for core work activities, States can count unlimited education, counseling, job search, or other barrier-removal activities toward the State's participation rate.

So then, we go back to Sara, the young mother to whom I previously referred, who, under current law-even though she was working 24 hours, and in counseling, and even looking for another job-did not count at all toward a State's participation rate and, consequently, would not get much attention from that State-the attention that is needed to improve people's economic growth.

Under the legislation before the Senate this year, as opposed to what current law has been since 1996, Sara would have up to 6 months allowed in barrier-removal activities, including domestic violence counseling and substance abuse counseling, that counts toward this State's participation rate, meeting the requirements of Federal law.

Once the 6 months are up, she has an additional 12 months that she can spend in education and training.

Once those 12 months are up, if she works for 24 hours a week, spends an hour a day, 5 days a week, in domestic-abuse counseling, and looks for a better job for an hour a day, 5 days a week, she then has reached the point where she counts as one family, where the State recognizes her as a very significant individual, where the State, by paying attention to her, is going to get some credit. In other words, under the legislation now before the Senate, Sara does count; whereas, under current law, Sara does not count.

During the past 3 years of debate on the issue of welfare reform, I have heard a number of different perspectives on the best approach to take for the next phase of welfare reform.

Some have argued the way to go is to increase the time that adults receiving assistance spend engaged in meaningful work activity. The correlation between full-time work and increased earnings is compelling.

Some have suggested that increasing the amount of time allowed for education and training is more important than increasing the time spent working. The correlation between increased education and increased earnings, of course, is compelling as well.

Others believe that encouraging marriage and reducing out-of-wedlock births would net the best result.

Still others have suggested that increasing State flexibility should be an integral part of any reform effort.

I firmly believe that when it comes to welfare reform, there is, in fact, no such thing as "one size fits all." While education may be the best approach for some, it may not be for others. Encouraging healthy family formation may be just what one family needs, but perhaps that approach would not be in the best interest of another family under different circumstances.

The PRIDE bill takes a blended approach to welfare reform and strives to find balance among all these perspectives.

The legislation before the Senate increases the emphasis on work and work-readiness activities, as well as increasing the flexibility for States to engage adults in education and training activities. The PRIDE legislation also provides resources to encourage States to develop innovative family formation programs, while making it clear that participation in those programs must be voluntary, and the program must be developed with domestic violence professionals.

I have a chart speaking to the factors that influence poverty rates. This approach is consistent with the latest research; in other words, the approach of flexibility-"one size fits all" not working.

We have a recent policy brief that was released by the Brookings Institution, and it was drafted by Ron Haskins and Isabel Sawhill. It is entitled "Work and Marriage: The Way to End Poverty and Welfare." The authors, using Census data and simple modeling, simulate the effects of various factors on the poverty rate for families with children.
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The poverty rate for families with children, in 2001, was 13 percent. Now, surely, everyone agrees that a central purpose of welfare reform is the reduction of poverty. As this chart clearly shows, the least effective factor in reducing poverty was to double a family's welfare benefit. The most effective single way to reduce poverty was to work full time. Indeed, according to these authors of the Brookings Institute policy brief:

[F]ull-time work eliminates almost half of the poverty experienced by families with children.

However, the most effective approach to reducing poverty was a combination of work, marriage, education, and family-size reduction.

As colleagues can see from this chart, when the blended approach is adopted, poverty is reduced a staggering 9.3 percent, going from 13 percent down to 3.7 percent.

I find these numbers to be quite compelling. I am pleased that they reinforce the approach taken in this legislation before the Senate.

I know there are colleagues who have many thoughts on these pieces of legislation, and we are going to have a very lively debate.

AMENDMENT NO. 2937

Mr. President, I send an amendment to the desk for the Senator from Maine, Ms. Snowe, and ask for its consideration.

The PRESIDING OFFICER (Mr. SUNUNU). The clerk will report.

The assistant legislative clerk read as follows:

The Senator from Iowa [Mr. GRASSLEY], for Ms. Snowe, for herself, Mr. Dodd, Mr. Hatch, Mr. Alexander, Mr. Carper, Mr. Bingaman, Mr. Rockefeller, Ms. Collins, Ms. Landrieu, Mrs. Murray, Mr. Jeffords, Mrs. Boxer, Mr. Chafee, Mrs. Lincoln, Mrs. Clinton, Ms. Mikulski, Mr. Coleman, and Mr. Schumer, proposes an amendment numbered 2937.

Mr. GRASSLEY. Mr. President, I ask unanimous consent that reading of the amendment be dispensed with.

The PRESIDING OFFICER. Without objection, it is so ordered.
The amendment is as follows:
(Purpose: To provide additional funding for child care)
Beginning on page 255, strike line 18 and all that follows through page 257, line 2, and insert the following:
SEC. 116. FUNDING FOR CHILD CARE.
(a) INCREASE IN MANDATORY FUNDING.-Section 418(a)(3) (42 U.S.C. 618(a)(3)), as amended by section 4 of the Welfare Reform Extension Act of 2003 (Public Law 108-040, 117 Stat. 837), is amended-

(1) by striking "and" at the end of subparagraph (E);
(2) by striking the period at the end of subparagraph (F) and inserting "; and"; and
(3) by adding at the end the following:

"(G) $2,917,000,000 for each of fiscal years 2005 through 2009.".

(b) RESERVATION OF CHILD CARE FUNDS.-

(1) IN GENERAL.-Section 418(a)(4) (42 U.S.C. 618(a)(4)) is amended to read as follows:

"(4) AMOUNTS RESERVED.-
"(A) INDIAN TRIBES.-
"(i) IN GENERAL.-The Secretary shall reserve 2 percent of the aggregate amount appropriated to carry out this section for a fiscal year for payments to Indian tribes and tribal organizations for such fiscal year for the purpose of providing child care assistance.
"(ii) APPLICATION OF CCDBG REQUIREMENTS.-Payments made under this subparagraph shall be subject to the requirements that apply to payments made to Indian tribes and tribal organizations under the Child Care and Development Block Grant Act of 1990.
"(B) TERRITORIES.-
"(i) PUERTO RICO.-The Secretary shall reserve 1.5 percent of the amount appropriated under paragraph (5)(A)(i) for a fiscal year for payments to the Commonwealth of Puerto Rico for such fiscal year for the purpose of providing child care assistance.
"(ii) OTHER TERRITORIES.-The Secretary shall reserve 0.5 percent of the amount appropriated under paragraph (5)(A)(i) for a fiscal year for payments to Guam, American Samoa, the Virgin Islands of the United States, and the Commonwealth of the Northern Mariana Islands in amounts which bear the same ratio to such amount as the amounts allotted to such territories under section 658O of the Child Care and Development Block Grant Act of 1990 for the fiscal year bear to the total amount reserved under such section for that fiscal year.
"(iii) APPLICATION OF CCDBG REQUIREMENTS.-Payments made under this subparagraph shall be subject to the requirements that apply to payments made to territories under the Child Care and Development Block Grant Act of 1990.".
(2) CONFORMING AMENDMENT.-Section 1108(a)(2) (42 U.S.C. 1308(a)(2)), as amended by section 108(b)(3), is amended by striking "or 413(f)" and inserting "413(f), or 418(a)(4)(B)".

(c) SUPPLEMENTAL GRANTS.-Section 418(a) (42 U.S.C. 618(a)) is amended-

(1) by redesignating paragraph (5) as paragraph (7); and
(2) by inserting after paragraph (4), the following:

"(5) SUPPLEMENTAL GRANTS.-
"(A) APPROPRIATION.-
"(i) IN GENERAL.-For supplemental grants under this section, there are appropriated-
"(I) $700,000,000 for fiscal year 2005;
"(II) $1,000,000,000 for fiscal year 2006;
"(III) $1,200,000,000 for fiscal year 2007;
"(IV) $1,400,000,000 for fiscal year 2008; and
"(V) $1,700,000,000 for fiscal year 2009.
"(ii) AVAILABILITY.-Amounts appropriated under clause (i) for a fiscal year shall be in addition to amounts appropriated under paragraph (3) for such fiscal year and shall remain available without fiscal year limitation.
"(B) SUPPLEMENTAL GRANT.-In addition to the grants paid to a State under paragraphs (1) and (2) for each of fiscal years 2005 through 2009, the Secretary, after reserving the amounts described in subparagraphs (A) and (B) of paragraph (4) and subject to the requirements described in paragraph (6), shall pay each State an amount which bears the same ratio to the amount specified in subparagraph (A)(i) for the fiscal year (after such reservations), as the amount allotted to the State under paragraph (2)(B) for fiscal year 2003 bears to the amount allotted to all States under that paragraph for such fiscal year.
"(6) REQUIREMENTS.-
"(A) MAINTENANCE OF EFFORT.-A State may not be paid a supplemental grant under paragraph (5) for a fiscal year unless the State ensures that the level of State expenditures for child care for such fiscal year is not less than the sum of-
"(i) the level of State expenditures for child care that were matched under a grant made to the State under paragraph (2) for fiscal year 2003; and
"(ii) the level of State expenditures for child care that the State reported as maintenance of effort expenditures for purposes of paragraph (2) for fiscal year 2003.
"(B) MATCHING REQUIREMENT FOR FISCAL YEARS 2008 AND 2009.-With respect to the amount of the supplemental grant made to a State under paragraph (5) for each of fiscal years fiscal year 2008 and 2009 that is in excess of the amount of the grant made to the State under paragraph (5) for fiscal year 2007, subparagraph (C) of paragraph (2) shall apply to such excess amount in the same manner as such subparagraph applies to grants made under subparagraph (A) of paragraph (2) for each of fiscal years 2008 and 2009, respectively.
"© REDISTRIBUTION.-In the case of a State that fails to satisfy the requirement of subparagraph (A) for a fiscal year, the supplemental grant determined under paragraph (5) for the State for that fiscal year shall be redistributed in accordance with paragraph (2)(D).".

(d) EXTENSION OF MERCHANDISE PROCESSING CUSTOMS USER FEES.-Section 13031(j)(3) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (19 U.S.C. 58c(j)(3)), as amended by section 201 of the Military Family Tax Relief Act of 2003 (Public Law 108-121; 117 Stat. 1343), is amended-

(1) by striking "Fees" and inserting "(A) Except as provided in subparagraph (B), fees"; and
(2) by adding at the end the following:

"(B) Fees may not be charged under paragraphs (9) and (10) of subsection (a) after September 30, 2009.".

Mr. GRASSLEY. I yield the floor.