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The original documents are located in Box 54, folder "9/7/76 HR12455 Child Day Care and
Social Services Amendments (1)" of the White House Records Office: Legislation Case
Files at the Gerald R. Ford Presidential Library
Copyright Notice
The copyright law of the United States (Title 17, United States Code) governs the making of
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Works prepared by U.S. Government employees as part of their official duties are in the public
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Exact duplicates within this folder were not digitized.
89/1/76
THE Mardin
ACTION
THE WHITE HOUSE
WASHINGTON
Last Day: September 7
September 3, 1976
Statement
MEMORANDUM FOR
THE PRESIDENT
FROM:
SUBJECT:
H.R. Child Day Care and
JIM CANNON 12455 Jun
Social Services Amendments
archives
Attached for your consideration is H.R. 12455, sponsored by
9/7/76
Representative Corman and seven others.
The enrolled bill postpones until October 1, 1977, enforcement
of Federal child day care staffing standards required under
the Title XX social services program; increases the $2.5
billion annual ceiling on Title XX funding by $240 million
through September 30, 1977, earmarked for child day care
services; provides incentives for employment of welfare
recipients by child day care providers; provides group
eligibility for social services; and makes other changes
in Title XX of the Social Security Act.
A detailed discussion of the provisions of the enrolled bill
is provided in OMB's enrolled bill report at Tab A.
OMB, Max Friedersdorf, Counsel's Office (Lazarus), Bill
Seidman, Jeanne Holm and I recommend approval of the enrolled
bill. The Council of Economic Advisers recommends disapproval.
RECOMMENDATION
That you sign H.R. 12455 at Tab B.
That you approve the signing statement at Tab C, which
has been cleared met by the White House Editorial Office (Smith) (Ceremonr)
Approve
Disapprove
Digitized from Box 54 of the White House Records Office Legislation Case Files at the Gerald R. Ford Presidential Library
A
EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
STATES
WASHINGTON, D.C. 20503
SEP 2 1976
MEMORANDUM FOR THE PRESIDENT
Subject: Enrolled Bill H.R. 12455 - Child Day Care and
Social Services Amendments
Sponsor - Rep. Corman (D) California and 7
others
Last Day for Action
September 7, 1976--Tuesday
Purpose
Postpones until October 1, 1977, enforcement of Federal
child day care staffing standards required under the
Title XX social services program; increases the $2.5 billion
annual ceiling on Title XX funding by $240 million through
September 30, 1977, earmarked for child day care services;
provides incentives for employment of welfare recipients by
child day care providers; provides group eligibility for
social services; and makes other changes in Title XX of
the Social Security Act.
Agency Recommendations
Office of Management and Budget
Approval (Signing
statement
attached)
Department of Health, Education, and
Approval (Signing
Welfare
statement
attached)
Council of Economic Advisers
Disapproval (Veto
message attached)
Department of the Treasury
No objection and
defers to other
agencies
Department of Labor
Defers to other
agencies
Discussion
H.R. 12455 is successor legislation to H.R. 9803, the child
day care services legislation which you vetoed on April 6,
1976. That veto was sustained by the Senate (60-34) on
May 5, 1976, after being overridden by the House (301-101).
2
Your veto message on H.R. 9803 contained several major
objections to that bill:
--unwarranted Federal interference in States'
administration of the Title XX social services program by
imposition of highly controversial and costly Federal day
care staff-to-children ratios;
--greater cost to the American taxpayer by requiring
expenditures of $125 million over six months, and possibly
as much as $250 million more each year thereafter, for
child day care services;
--the earmarking of a portion of Federal social
services funds for a narrow, categorical purpose, thereby
undermining the Title XX commitment to allow the States
their own initiative in determining the form and content
of social services; and
--the introduction of two additional matching rates
for Title XX funds, with the result of further complicating
the States' administration of social services programs.
Your message urged the Congress to extend, until October 1,
1976, the moratorium on imposition of Federal day care
staffing standards, thus providing ample time to enact your
Title XX block grant proposal, the "Federal Assistance for
Community Services Act," which would allow States to estab-
lish and enforce their own day care staffing standards and
give them greater flexibility with respect to all the
Title XX social services programs.
H.R. 12455 contains several provisions which were included
in H.R. 9803, but differs in a number of respects described
below.
Summary of congressional consideration
As passed by the House unanimously (383-0) on March 16, 1976,
H.R. 12455 would simply have extended from April 1, 1976,
to October 1, 1976, HEW regulations providing that individual
means tests do not have to be applied in determining eligi-
bility for Title XX social services which were not subject
to such tests before Title XX took effect. The House action
was prompted by protests from various groups, but especially
from senior citizens' organizations, on the basis that an
individual means test was demeaning, complex, and adminis-
tratively costly. The House bill was described during floor
debate as "emergency" legislation pending further considera-
tion of the "group eligibility" question.
3
On May 20, 1976, the Senate passed, 48-16, its version of
H.R. 12455 which was described as containing a "compromise"
on the question of day care standards and funding. Major
features of the Senate-passed bill would have (1) eliminated
entirely the present eligibility requirements in Title XX
(generally based on income levels or welfare status), (2)
postponed until October 1, 1977, enforcement of the Federal
day care staffing standards, (3) authorized $375 million in
additional earmarked child day care funding under Title XX
through September 30, 1977, ($125 million through September
30, 1976, and $250 million for fiscal year 1977), and (4)
provided incentives to employ welfare recipients in child
care jobs.
Both Senators Mondale and Packwood--who initially developed
the Senate "compromise"--described it in those terms because
it postponed the Federal day care staffing standards long
enough to allow a statutorily-mandated study by HEW of this
issue to be completed, and HEW's recommendations considered,
before they would take effect.
A motion in the Senate Finance Committee to delete the added
day care funding provided in the Senate bill was defeated
by a vote of 6-11. It was supported in the Committee by
Senators Talmadge, Byrd, Curtis, Fannin, Hansen, and Roth;
it was opposed by Senators Long, Hartke, Ribicoff, Mondale,
Gravel, Bentsen, Hathaway, Haskell, Dole, Packwood, and
Brock. An amendment was also offered on the Senate floor to
remove the added funds for day care; this amendment was
defeated by a vote of 20-50.
The Administration expressed strong opposition to the Senate
version of H.R. 12455, and again urged the Congress simply
to extend the moratorium on the day care standards until
October 1, 1976, and enact the block grant proposal.
The conferees on H.R. 12455 made only minor concessions to
the Administration's position. The conference report was
adopted in the House on July 1, 1976, by a vote of 281-71 and
in the Senate on August 24, 1976, by a vote of 72-15.
Major provisions of H.R. 12455
HEW has enclosed a detailed summary of H.R. 12455 with its
attached views letter. The following, therefore, highlights
the major provisions and compares them with the provisions of
H.R. 9803 and, where appropriate, the Administration's block
grant proposal.
4
Eligibility for Title XX social services - H.R. 12455
would permit States to determine eligibility for social
services on a group basis. The group would have to be such
that the State could reasonably conclude that substantially
all members of the group have incomes below 90% of the
State's median income. Eligibility for child day care
services, however, would continue to be determined on an
individual basis, except for children of migrant workers.
There would be no Federal eligibility requirements for family
planning services.
H.R. 9803 contained no comparable provisions. The block
grant proposal included a group eligibility provision some-
what similar to the one in H.R. 12455, and HEW supports this
section of the enrolled bill.
Day care staffing requirements - The enrolled bill would
extend the moratorium on the application of Title XX day
care staffing standards retroactive to February 1, 1976,
(when it expired) through September 30, 1977.
H.R. 9803 would have extended the moratorium through June 30,
1976. The Administration's block grant proposal would repeal
the staffing requirements altogether, effective October 1,
1976, and would, instead, require the States to have their
own standards for day care services provided under Title XX.
Increased funding for day care services - H.R. 12455
would raise the current $2.5 billion limit on annual Federal
funding of Title XX by $40 million for the transition quarter
and $200 million for fiscal year 1977. These added funds,
earmarked for day care services, would be allocated to the
States on the basis of population, retaining the 75% Federal-
25% State matching rate in present law for the transition
quarter. No State matching would be required for the added
$200 million entitlement in fiscal year 1977.
H.R. 9803 would have added $125 million to the Title XX
ceiling for day care services through the transition quarter,
with $25 million to be allocated to States with special
problems in meeting the Federal day care standards, and with
a Federal match of 80% applied to the added funds.
The Administration's block grant proposal would do away with
all State matching requirements for Title XX funding.
5
Provisions to encourage employment of welfare recipients -
As in H.R. 9803, H.R. 12455 would permit States to use the
added day care funds to reimburse eligible child care pro-
viders for the cost of employing welfare recipients.
For public and nonprofit providers, the grants could be
used to pay wages up to $5,000 per employee per year.
For proprietary providers, the grants would be limited to
$4,000 per year. This provision, however, is coupled with
another which would extend through September 30, 1977, the
temporary authority provided in the Tax Reduction Act of 1975,
for a Federal Welfare Recipient Employment Incentive Tax
Credit. The tax credit extension would apply only to child
care employers and could go up to $1,000, thus also providing
full Federal funding of employment costs up to $5,000 per
employee for private "for-profit" providers.*
Arguments for approval
1. Proponents perceive H.R. 12455 as a basic compromise
on the key issue which they believe caused the veto of H.R.
9803--the Federal day care staffing standards--since the
enrolled bill would postpone these standards for sufficient
time to permit consideration of the results of HEW's
"appropriateness" study, which are due by June 30, 1977.
HEW states that the enrolled bill, unlike the previously
vetoed bill, does not presuppose eventual Federal imposition
of staffing standards.
2. H.R. 12455 is also viewed as a compromise in that
the added day care funds are somewhat less than intended
under the vetoed H.R. 9803, as understood from the legis-
lative history of that measure. HEW reiterates its comment
on H.R. 9803 that it objects less to the additional expendi-
tures than to the long-term consequence in that bill of
perpetuating Federal child day care requirements.
3. Congressional proponents argue that States cannot
provide quality child day care or even meet health and safety
standards without financial assistance from the Federal
Government. Without such assistance, States might have to
limit day care services for the poor, which would be counter
to the objective of providing child care to enable welfare
parents to work and thereby reduce the welfare burden.
*You should know that although tax deductions for medical care
under present law would not significantly increase tax expend-
itures for day care, the tax reform bill now in conference
would give a tax credit which would duplicate many of the child
care benefits even for these low income people.
6
4. The States and many in Congress argue that the
$200 million increase over the $2.5 billion ceiling is
necessary to provide some relief against the effects of
inflation on State social services programs, especially
since the ceiling has not been raised since its imposition
in 1972.
5. The proposed incentives to day care institutions
for hiring welfare recipients would, supporters of the
bill believe, provide greater income to the poor, reduce
the welfare rolls, restrain the personnel costs associated
with delivering day care services, and provide welfare
recipients with needed work experience and skills to become
self-supporting.
6. Welfare groups and, especially, senior citizen
organizations, support the group eligibility provisions
of this enrolled bill, which would avoid subjecting in-
dividuals to possibly demeaning income and assets tests
in order to qualify for a social service. Furthermore,
the bill represents an improvement over the Senate version,
which would have eliminated all income criteria for setting
eligibility for federally-funded social services under
Title XX.
7. In HEW's view, the administrative complexities
resulting from the enrolled bill would not be as substantial
as they would have been under the vetoed H.R. 9803. The
Department believes, moreover, that the acceptance by the
Congress of some Federal financial participation with no
matching requirement moves clearly in the direction of the
Administration's block grant proposal, under which there
would be no matching requirement at all.
Arguments against approval
1. The retention of the Federal day care staffing
standards in the enrolled bill, even though postponed, is
much less desirable than their outright repeal as proposed
by the Administration. H.R. 12455 would still leave the
States uncertain about the reimposition of these highly
controversial and costly standards in October 1977. This
uncertainty could be disruptive of the orderly and compre-
hensive development of State social services programs.
2. The bill would increase the budget deficit for the
transition quarter and fiscal year 1977 by a total of $240
million, as an entitlement to the States, plus a revenue
7
loss--impossible to estimate, but most likely small--result-
ing from the proposed extension of tax credits to profit-
making day care institutions that hire welfare recipients.
Moreover, the funding provision would probably be extended
beyond fiscal year 1977 at an annual cost of $200 million
above the $2.5 billion ceiling in present law.
3. Congressional opponents argue that it is not
logical to provide added money for compliance with day care
standards which do not exist. The increased funding entitle-
ment for the transition quarter and fiscal year 1977 would,
in fact, not necessarily result in any increase or improve-
ment in child day care services. The $40 million in the
transition quarter, coming this late in the quarter, would
simply be a windfall to those States that over-match their
Title XX allotment and can thereby match the added funding.
They would not be required to deliver more services for
this money. States not over-matching probably could not
increase their matching at this late date to share in the
transition quarter increase. In fiscal year 1977, since
the $200 million requires no State matching funds but must
be spent on child day care, it could readily be used to
substitute for existing resources spent on child day care.
The freed-up resources could then be spent for any other
purposes, not necessarily child day care.
4. The earmark proposed for one particular service--
child day care--is counter to a basic principle that guided
the development of the Title XX program and that motivates
the Administration's block grant proposal: namely, that
States should have the greatest flexibility in selecting the
services that meet their own priorities.
5. The impetus in the bill to staff child day care
centers with welfare recipients may not necessarily be the
most beneficial approach for the children served. The
qualifications of the person hired should be the primary
concern in order to safeguard the best interests of the
children served. HEW believes the tax credit, in combination
with the incentive grants, is an unnecessarily complex means
of encouraging employment of welfare recipients, and neither
provision is likely to improve the quality of the care itself.
6. There is considerable doubt whether the bill's
provisions would result in any appreciable number of welfare
recipients being hired in child day care centers, given past
experience with the Work Incentive (WIN) tax credit. The
likely effect is that those centers now employing welfare
recipients will receive a windfall.
8
7. H.R. 12455 would foster administrative complexity
and confusion by retaining and increasing diverse matching
rates for various services: i.e., 90% for family planning,
100% for the increased child day care funding, 75% for
other services. In addition, grants could finance 100% of
welfare recipients' salaries at public or nonprofit child
day care centers, but only 80% at "for-profit" centers.
These disparate Federal requirements add to the burden
that States must operate under in administering Title XX.
8. The enrolled bill would undercut the Administra-
tion's social services block grant proposal. It runs
counter to that proposal's objectives of removing burden-
some Federal restrictions on the States and eliminating
narrow categorical programs which restrict a State's decision-
making scope. Approval of this bill may be viewed as a
major renovation of the Title XX program and thus discourage
subsequent, broader reform that would enhance the States'
abilities to operate their social services programs most
flexibly in accord with their highest priority needs.
Recommendations
HEW, despite reservations, urges approval of the enrolled
bill and has enclosed a draft signing statement for con-
sideration. In addition to the Department's positions on
specific provisions, noted above, HEW states that its
concerns about the earmarking of additional funds for day
care and the provision to encourage employment of welfare
recipients are not so great as to cause it to recommend a
veto.
HEW concludes that the political considerations related to
the bill are of important significance. Its letter states:
"It seems evident to us that, because the Congress
eliminated from H.R. 12455 the most objectionable
features of H.R. 9803, a veto of H.R. 12455 could
not be sustained. Furthermore, because H.R. 12455
would authorize group eligibility determinations--
something for which senior citizens groups, among
others, have campaigned heavily--a veto of the
enrolled bill would risk public perception of this
Administration as one opposed to day care, opposed
to easing the procedures by which the elderly can
qualify for services, and opposed to free access
to family planning services."
* This is a classic demonstration of the lack of congres-
sional coordination in that the child care provisions of
this bill appear to bear no reasonable relationship to
the tax credit provisions in the pending tax reform bill.
9
Treasury has serious questions regarding the effectiveness
of the tax credit provisions in H.R. 12455, and does not
believe the tax system is an apt mechanism for administer-
ing a program of such limited scope. However, because the
tax related provision is relatively unimportant relative
to the bill as a whole, Treasury has no objection to
approval, and defers to more concerned Departments.
CEA recommends a veto on the basis that the bill is contrary
to several Administration objectives--to better target
subsidies intended for the poor, to have a more efficient
allocation of workers among jobs, and to limit Federal
spending. CEA's draft veto message expresses concern that
under the bill's group eligibility requirement, many persons
who do not have low income or assets could qualify for
benefits, and indicates several objections to the wage
subsidies proposed for hiring welfare recipients.
*****
Strictly in terms of its programmatic merits and budgetary
impact, H.R. 12455 is undesirable legislation in our view.
It does not go very far in meeting your objections to
H.R. 9803, nor does it make substantial progress toward
your social services block grant proposal. Nevertheless,
it is widely viewed in the Congress, on a bipartisan basis,
as a compromise in attempting to deal with the issue of
Federal day care standards. Moreover, the particularly
popular group eligibility provisions are generally similar
to those in your block grant proposal. Accordingly, we
recommend that you approve the bill with a signing statement
pointing out some of your reservations and urging the more
fundamental reform of the Title XX program contained in the
block grant legislation.
James Director T. Lynn
Enclosures
Note: Both the first concurrent resolution on the budget
and the Senate and House versions of the second
concurrent resolution make provision for the
additional amounts for child care in this bill.
HEALTH.
3 EDUCATION MELIVERY
DEPARTMENT OF HEALTH, EDUCATION. AND WELFARE
USA
The Honorable James T. Lynn
AUG 3 0 1976
Director, Office of Management
and Budget
Washington, D. C. 20503
Dear Mr. Lynn:
This is in response to your request for a report on H.R. 12455,
an enrolled bill "To amend title XX of the Social Security
Act so as to permit greater latitude by the States in
establishing criteria respecting eligibility for social
services, to facilitate and encourage the implementation
by States of child day care services programs conducted
pursuant to such title, to promote the employment of
welfare recipients in the provision of child day care
services, and for other purposes."
The enrolled bill, which we recommend be enacted, is described
in detail in the enclosed summary. Briefly stated, the bill's
principal objectives are to encourage the employment of AFDC
eligibles to provide day care services; to provide the States
with additional funds, under title XX of the Social Security
Act, for covering day care expenses; to permit States, under
certain conditions, to determine an applicant's eligibility
for title XX services on a group basis, without the necessity
of individual determinations of eligibility; and to postpone
until October 1, 1977, the imposition of title XX day care
staffing requirements.
The enrolled bill contains several provisions which were also
contained in H.R. 9803, a bill which was vetoed by the
President on April 6, 1976, and which veto was sustained by
the Senate on May 5, 1976. In his message accompanying the
veto of H.R. 9803, the President gave as his principal
reasons for withholding his approval of that bill his belief
that (1) States should have the responsibility--and the right--
to enforce their own quality day care standards; (2) the
additional funds which the bill would have made available
for day care would be a further costly burden on the American
taxpayer; (3) the "earmarking" of a portion of title XX
funds for a narrow categorical purpose (day care) would be
The Honorable James T. Lynn
2
contrary to the title XX commitment to State, rather than
Federal, initiative; and (4) the imposition of two additional
matching rates for title XX funds would create new adminis-
trative complexities.
Some of these objections apply, as well, to the enrolled
bill. However, we believe that as a result of the President's
expressed concerns, there are significant differences between
H.R. 9803 and H.R. 12455 which justify the approval of the
latter.
Of greatest importance are the differing approaches taken by
the bills regarding the issue of day care staffing standards.
The vetoed bill would have extended the moratorium on the
application of title XX day care staffing standards only
through June 30, 1976, and would have required the Secretary
to allot to States a total of $125 million during fiscal year
1976 and the transition quarter to enable States to comply
with the federally imposed staffing requirements. The enrolled
bill, on the other hand, does not presuppose eventual Federal
imposition of staffing standards. It would extend the
moratorium on the application of such standards through
September 30, 1977, thus providing an opportunity for a
thorough review of the Secretary's report and recommendations
to the Congress pertaining to the appropriateness of Federal
day care standards. That report is required to be submitted
by June 30, 1977. Furthermore, the enrolled bill does not
contain any new funding for the specific purpose of assisting
States to comply with Federal staffing standards.
Secondly, the administrative complexities which would result
under the enrolled bill are not as substantial as they would
have been under H.R. 9803. Whereas that bill would have
established three rates of Federal financial participation
(FFP) under title XX (75 percent, 80 percent, and 100 percent),
the enrolled bill would maintain 75 percent FFP for all
purposes except State grants to aid the employment of welfare
recipients and to the extent that, with respect to fiscal
year 1977, the new funding provided by the bill is used for
day care. In the latter cases, there would be no matching
requirement. Although this provision will add some complexity
to the program, not only would it be to a much lesser extent
The Honorable James T. Lynn
3
than under H.R. 9803, but the acceptance by the Congress of
some Federal financial participation with no matching
requirement moves clearly in the direction of the Administration's
proposed "Federal Assistance for Community Services Act",
under which there would be no matching requirement at all.
Thirdly, the bills differ in regard to the funding levels
specified in each. Under the vetoed bill, we would have
been required to spend an additional $125 million during the
remainder of fiscal year 1976 and the transition quarter.
Furthermore, it was understood at the time that the Congress
intended to support the day care program established by
the bill with $250 million each year thereafter. The enrolled
bill would increase the current spending limit of $2.5 billion
by $40 million during the transition quarter and by $200 million
during fiscal year 1977. Although, practically, therefore,
the differences are not substantial, nevertheless, as we
stated in our enrolled bill report on H.R. 9803, "there is
less objection to the additional expenditure than to the bill's
long-term consequence of perpetuating Federal child day care
requirements that the Administration is seeking to replace
with standards established by the States."
Lastly, unlike H.R. 9803, the enrolled bill would authorize
States, under certain conditions, to determine eligibility
for social services on a group basis. The Administration
included a similar provision in its "Federal Assistance for
Community Services Act" and we support this section of the
enrolled bill.
With respect to those provisions of the enrolled bill which
are similar to those of H.R. 9803:
1. We have not supported section 3 of the enrolled
bill, which would authorize each State to use an amount not
in excess of the additional sums made available under the
bill for unmatched "welfare recipient employment incentive
expenses" (i.e., the costs of employing AFDC eligibles to
The Honorable James T. Lynn
4
provide day care services), or for child day care services at
a Federal share of 75 percent with respect to the transition
quarter and 100 percent with respect to fiscal year 1977. We
believe that such earmarking for child day care services
undercuts a principle central to the current title XX, as well
as the Administration's proposed amendments to it: that
the States should retain the flexibility to make their own
decisions on the best uses of Federal financial assistance
for social services because the services are addressed to
problems that are primarily the States' responsibility. On
the other hand, our concern with this provision is not so
great as to cause us to recommend veto of the enrolled bill
solely on its account.
2. We have not supported section 4 of the enrolled bill,
which would make available, through September 30, 1977, to
each provider of day care services a tax credit of $1000 per
AFDC eligible employed in connection with the provision of
child day care services. The desirability of a new tax
credit for welfare recipient employment incentive expenses
incurred in the provision of child day care services cannot
be considered in isolation from the bill's establishment of
the corresponding incentive expense grant under title XX. We
believe the tax credit, in combination with the incentive
expense grants, is an unnecessarily complex means of
encouraging the employment of AFDC eligibles to provide
day care, and neither provision is likely to improve the
quality of the care itself. However, like the incentive
expense grants, we do not believe section 4 warrants veto of
the enrolled bill.
Finally, we have no objection to the provisions of the enrolled
bill which would eliminate eligibility requirements for
family planning services, which would authorize each State
agency to waive the staffing requirements otherwise applicable
to certain day care centers or group day care homes, and
which would extend through fiscal year 1977 the provisions
of Public Law 94-120, pertaining to rehabilitative services
for alcoholics and drug addicts.
The Honorable James T. Lynn
5
Aside from the substantive issues addressed above, we believe
the political considerations are of important significance.
It seems evident to us that, because the Congress eliminated
from H.R. 12455 the most objectionable features of H.R. 9803,
a veto of H.R. 12455 could not be sustained. Furthermore,
because H.R. 12455 would authorize group eligibility determi-
nations--something for which senior citizens groups, among
others, have campaigned heavily--a veto of the enrolled bill
would risk public perception of this Administration as one
opposed to day care, opposed to easing the procedures by
which the elderly can qualify for services, and opposed to
free access to family planning services.
For the reasons given, and in spite of our reservations,
we urge that the President approve the enrolled bill. In
addition to the summary of the bill, we have enclosed a draft
signing statement for consideration.
Sincerely,
Actime Secretary
Enclosures
SUMMARY OF THE PROVISIONS OF
ENROLLED BILL H.R. 12455
Eligibility for social services
The first section of H.R. 12455 would permit States to
determine an individual's eligibility for social services
on a group basis. However, the group would have to be such
that the State can reasonably conclude that substantially
all persons in the group are members of families with incomes
of not more than 90 percent of the median income in the
State adjusted for family size. Furthermore, except for
children of migrant workers, eligibility for child day
care services would have to continue to be determined on
an individual basis. Where eligibility for any service is
determined on a group basis, the State may use generally
accepted statistical sampling procedures to determine the
proportion of expenditures which are to be attributed to
meeting the requirement that 50 percent of the State's
payment under title XX be expended on services for the
"categorical eligibles". Individuals who are determined to
be eligible for services under title XX on a group basis would
not be subject to the mandatory fee provision of section
2002 (a) (6) (B). The first section would also include family
planning services among those services for which there are
no Federal eligibility requirements. The effective date of
this section would be October 1, 1975.
Extension of moratorium on day care staffing requirements
Section 2 of H.R. 12455 would extend the current
moratorium on the application of title XX day care staffing
requirements, contained in $2002 (a) (9) (A) (ii) of the Social
Security Act, from January 31, 1976, through September 30, 1977.
The Social Services Amendments of 1974, Public Law 93-647,
originally provided for the requirements to come into effect
on October 1, 1975. This date was postponed (under certain
conditions) to February 1, 1976, by P.L. 94-120.
2
The Administration's proposed Federal Assistance for
Community Services Act (H.R. 12175; S. 3061) would repeal
the staffing requirements altogether, effective October 1,
1976, as well as the mandatory application of the Federal
interagency day care requirements to day care services under
titles XX, IV-A, and IV-B of the Social Security Act. In
their place, a State that provides child day care services
under title XX would be required to have in effect its own
appropriate mandatory standards for all day care services
provided under the title.
Increased social services funding for day care
Section 3 (a) of the enrolled bill would raise the
current $2.5 billion limit on annual funding of social
services by $40 million with respect to the 1976 transition
quarter and by $200 million with respect to fiscal year
1977. However, the amount of the increased funds payable to
any State would be limited to an amount no greater than a
State's aggregate expenditures for child day care services
and grants to cover Federal welfare recipients employment
incentive expenses. In effect, the bill would thus earmark
for day care an amount equal to the additional funds which
would become available under section 3. The additional
funds would be allocated among the States on the basis of
population (as is the case under current law).
Section 3 (b) of the enrolled bill would require States,
to the extent they determine feasible, to use the additional
funds available pursuant to section 3 in a manner which
increases the employment of welfare recipients and other low
income persons in jobs related to the provision of child day
care services. However, the grants authorized by section 3 (c)
of the enrolled bill would be for the employment of welfare
recipients only; no similar additional authority would be
provided by the bill for grants to cover wages of low income
persons in jobs related to day care. Such costs could be
met only as they currently are under title XX.
3
State grants to aid employment of welfare recipients
Section 3 (c) of the enrolled bill would permit States
to use an amount not in excess of the added Federal funding
available under the bill to make grants to child care
providers to cover the cost of employing welfare recipients
without regard to (1) the social service goals specified in
$2002 (a) (1) and (2) the requirement that 25 percent of
service costs be covered from sources other than title XX.
These grants would be limited to $4000 per year per employee
in the case of proprietary providers, thus providing, in
conjunction with the tax credit provided pursuant to
section 4 ($1000, or 20 percent of not more than $5000 per
year in wages, per welfare employee), full Federal funding
of employment costs up to $5000 per employee. For public
and nonprofit providers, which are ineligible for tax credits,
the grants under this section could be used to pay wages to
a qualified employee at an annual rate of up to $5000 per
employee per year. Grants could be made under this authority
only if at least 20 percent of the children serviced by
the child care provider have their care paid for through the
title XX program.
Elimination of matching requirement for day care
Section 3 (d) of the enrolled bill would allow the
Federal payment under title XX to cover the full cost of
child day care services during fiscal year 1977 (i.e., there
would be no matching requirement). However, the total amount
of a State's payment with respect to which there would be no
matching requirement (including sums which are used to cover
grants to aid employment of welfare recipients) would in no
case be able to exceed the amount by which the State's
maximum allowable title XX payment had been increased by the
bill from the amount available under the $2.5 billion limita-
tion.
4
Extension of welfare recipient tax credit
A tax credit for hiring welfare recipients through the
Work Incentive (WIN) program was first authorized under the
1971 Revenue Act. In addition, in the Tax Reduction Act of
1975, temporary authority (which expired on June 30, 1976)
was provided for a Federal Welfare Recipient Employment
Incentive Tax Credit. Section 4 of the enrolled bill would
extend the tax credit, only in the case of child care
employers, through September 30, 1977. This new temporary
tax credit for hiring welfare recipients to provide child
care would apply solely to the employment of a welfare
recipient who:
(A) has been certified by the State or local welfare
department as being eligible for financial assistance
for aid to families with dependent children (AFDC) and
as having continuously received AFDC during the 90-day
period which immediately precedes the date on which
the employee is hired by the taxpayer,
(B) has been a full-time employee of the taxpayer
for a period in excess of 30 consecutive days,
(C) has not displaced any other individual from
employment by the taxpayer,
(D) is not a migrant worker, and
(E) is not a close relative of the taxpayer.
The tax credit would equal 20 percent of the wages, not
exceeding $5000 per year, paid each welfare recipient
employed to provide child care services (thus limiting the
annual credit to $1000 per employee). Unlike the credit for
work incentive program expenses, which is limited in any
year to $25,000 plus 50 percent of any tax liability above
$25,000, there would be no aggregate limit for child care
employers.
5
Waiver of staffing standards
Section 5 of the enrolled bill would, for a temporary
period, allow a State agency to waive the staffing require-
ments otherwise applicable to certain day care centers or
group day care homes if the agency finds that it is not
feasible for the center or home to comply with them, and
the center or home complies with applicable state standards.
A day care center or group day care home would be eligible
for the waiver if the care for not more than 20 percent of
the facility's children is wholly or partly paid from title XX
funds. However, in the case of a day care center, the waiver
authority would only apply if the care for not more than
five of its children were so paid for. The authority which
would be provided by section 5 would expire at the end of
fiscal year 1977.
Disregard of child in family day care home
In addition to enacting the above-described waiver
authority, section 5 of the enrolled bill would also provide
that, in the case of applying the title XX day care services
staffing requirements to family day care homes, the children
of the mother operating the home shall not be counted unless
they are under age 6. Like the waiver requirement, this
exception would be effective only through fiscal year 1977.
Rehabilitative services for alcoholics and drug addicts
Section 2002 (a) (7) of the Social Security Act now
imposes a limit on Federal financial participation under
title XX with respect to medical or remedial care and room
and board. Essentially, the care must be an integral but
subordinate part of a title XX service, the expenditure for
which care is not available to the State under its Medicaid
program. A related provision, $2002 (a) (11), prohibits payments
under title XX for expenditures for the provision of services
to any individual living in any hospital, subject to certain
exceptions.
6
Public Law 94-120, for the 4-month period, October 1,
1975, through January 31, 1976, enacted an addition to the
exceptions in $2002 (a) (11) The additional exception was
for expenditures for up to 7 days of initial detoxification
of an alcoholic or drug dependent individual if such detoxi-
fication is integral to the further provision of services
for which such individual would otherwise be eligible under
title XX. It also required that the entire rehabilitative
process for ending the dependency of individuals who are
alcoholics or drug addicts, including but not limited to
initial detoxification, short-term residential treatment,
and subsequent outpatient counseling and rehabilitative
services, be used as the basis for determining whether the
relevant $2002 (a) (7) standards are met.
Section 6 of the enrolled bill would extend these
P.L. 94-120 amendments through fiscal year 1977.
k
B
B
STATEMENT BY THE PRESIDENT
I have today signed into law H.R. 12455, a bill
concerning child day care staffing standards and social
services supported with Federal financial assistance. En-
suring adequate day care for children is an important social
service. It protects the well-being of thousands of American
children -- and the economic independence of their working
parents. The integrity of the family is of paramount impor-
tance but supportive government action is acceptable as long
as it does not interfere with the family role.
Earlier this year, I vetoed the predecessor version of
this bill, H.R. 9803 -- not because I disagreed with its
goals -- but because that bill was the wrong means to a
worthwhile end. The Congress sustained my veto. Today I
have signed a new and better child day care bill -- the result
of compromise and cooperation between the Congress and my
Administration. H.R. 12455 embodies a major compromise on a
key issue which led to that veto -- the imposition on States
and localities of costly and controversial Federal staffing
requirements for child day care services funded under Title XX
of the Social Security Act.
H.R. 9803 would have imposed these standards effective
July 1 of this year. Had that bill become law, it would have
brought about an unwarranted Federal preemption of State and
local responsibility to ensure quality day care services.
H.R. 12455, by postponing the Federal standards until
October 1, 1977, will enable the States to operate day care
programs for more than another year free of onerous and costly
Federal intrusion, while HEW completes a required major study
and report with recommendations on the day care standards.
In addition, the Congress will have the opportunity to act
on my proposed "Federal Assistance for Community Services
Act," submitted to the Congress last February to reform the
Title XX social services program.
2
My proposal would provide the States with the oppor-
tunity to administer the Title XX program with the necessary
flexibility to meet their most pressing needs as they
themselves determine those needs. It would simplify
program operations and remove many of the burdensome and
restrictive Federal requirements so that social services
can be provided in the most efficient and effective manner,
and can be most responsive to the needs of our citizens.
As part of this overall approach, it would require the
States to adopt and enforce their own standards for
federally-assisted child day care.
While I am disappointed that the Congress has not, in
H.R. 12455, clearly placed this responsibility and authority
in the States, the bill's lengthy suspension of the standards
is a positive step toward this objective.
H.R. 12455 does adopt a concept contained in my
Federal Assistance to Community Services proposal by
permitting States to provide Title XX services on a "group
eligibility" basis, except for most child day care services.
Under this bill, States will not have to require that senior
citizens and other persons who need and depend on social
services programs be subjected to individual income and
assets tests in order to determine whether they can parti-
cipate in these programs. Such persons will be eligible
as members of groups, when the States can reasonably assume
that substantially all those to be served have incomes less
than 90% of the State's median income.
This provision will make it possible for older persons
and families who obviously qualify for federally-assisted
services to obtain those services without a demeaning
scrutiny of their personal affairs. It will also eliminate
3
unnecessary and costly administrative trappings for many
service programs, thereby freeing more Federal and State
funds for the actual delivery of services.
H.R. 12455 embodies, in part, still another central
element of my Federal Assistance for Community Services
proposal: that States should no longer be required to
match their share of the Federal Title XX social service
funds with State and local tax dollars. Under this bill,
as much as $200 million in new Title XX funds would be
distributed in fiscal year 1977 without a requirement for
State matching, if States choose to spend that amount for
child day care services. I am hopeful that this tentative
step indicates the willingness of the Congress to consider
seriously the elimination of the matching requirement for
all Federal social services funds under Title XX.
I do have serious reservations about the amount of
additional Federal funding provided in H.R. 12455, although
it is less than the amount in the bill I earlier vetoed.
It is also unfortunate that this bill, for the first time
under Title XX, designates levels of funding for specified
purposes. This is the antithesis of the spirit and intent
of Title XX which permits States the maximum flexibility to
determine their own priorities in using their share of
Federal social services funds. I am also concerned that the
child care provisions of this bill have not been adequately
coordinated with child care provisions in the pending tax
reform bill.
Much remains to be done to help the States improve
their delivery of social services funded under Title XX.
I am gratified that the Congress, in this bill, has moved
in some measure toward accepting concepts in my proposed
4
act to provide financial assistance for community services.
Further action is needed, however, to provide more comprehensive
reform that will provide States the tools and flexibility
to deliver social services to those in need without cumber-
some Federal regulation. I again urge the Congress to act
promptly to give my proposal a full and favorable hearing.
Latest Draft 9/7/76
STATEMENT BY THE PRESIDENT
I have today signed into law H.R. 12455, a bill concerning
child day care staffing standards and social services supported
with Federal financial assistance. Ensuring adequate day care for
children is an important social service. It protects the
well-being of thousands of American children--and the economic
working
independence of their parents. THE continue to believe that he
but
integrity of the family is of paramount importance
A
Supportive
government action is acceptable as long as it does not interfere
with the family role.
Earlier this year, I vetoed the predecessor version of this
bill, H.R. 9803 - not because I disagreed with its goals--but
because that bill was the wrong means to a worthwhile end. The
Congress sustained my veto. Today I have signed a new and
better child day care bill--the result of compromise and
cooperation between the Congress and my Administration. H.R.
12455 embodies a major compromise on a key issue which led to
that veto--the imposition on States and localities of costly
and controversial Federal staffing requirements for child day
care services funded under Title XX of the Social Security Act.
STATEMENT BY THE PRESIDENT
quist
I have today signed into law H.R. 12455, a bill
concerning child day care staffing standards and
social services supported with Federal financial
assistance. important social service protect. the
Ensurunc adidas nate day care Por children well-being 3 an
thousands of american children and the economic indepen-
Earlier this year, I vetoed the predecessor version their dence of
not because used with its coshs
ad,
but because that bill was the withs means
of this bill, H.R. 9803 and the Congress sustained my
L
parents.
Today J have
to a worthwheld
end
signed anew
veto. I have signed H.R. 12455 because it embodies a
and better child)
major compromise on a key issue which led to that veto --
day care tree-
He result of
the imposition on States and localities of costly and
controversial Federal staffing requirements for child
detween dooperation the
day care services funded under Title XX of the Social
snyless and
my Administration.
Security Act.
12455
H.R. 9803 would have imposed these standards effec-
tive July 1 of this year. Had that bill become law, it
would have brought about an unwarranted Federal preemp-
tion of State and local responsibility to ensure quality
day care services.
H.R. 12455, by postponing the Federal standards
until October 1, 1977, will enable the States to operate
day care programs for more than another year free of
onerous and costly Federal intrusion, while HEW completes
a required major study and report with recommendations on
the day care standards. In addition, the Congress will
have the opportunity to act on my proposed Jedenal Financial
Assistance for Community Services Act," submitted to the
Congress last February to reform the Title XX social
services program.
My proposal would provide the States with the oppor-
tunity to administer the Title XX program with the necessary
flexibility to meet their most pressing needs as they
themselves determine those needs. It would simplify
program operations and remove many of the burdensome and
FORD JERANT
2
restrictive Federal requirements so that social services
can be provided in the most efficient and effective manner,
and can be most responsive to the needs of our citizens.
As part of this overall approach, it would require the
States to adopt and enforce their own standards for
federally-assisted child day care.
While I am disappointed that the Congress has not, in
H.R. 12455, clearly placed this responsibility and authority
in the States, the bill's lengthy suspension of the standards
is a positive step toward this objective.
H.R. 12455 does adopt a concept contained in my
Jeden Assistance to Community Services proposal by
permitting States to provide Title XX services on a "group
eligibility" basis, except for most child day care services.
Under this bill, States will not have to require that senior
citizens and other persons who need and depend on social
services programs be subjected to individual income and
assets tests in order to determine whether they can parti-
cipate in these programs. Such persons will be eligible
as members of groups, when the States can reasonably assume
that substantially all those to be served have incomes less
than 90% of the State's median income.
This provision will make it possible for older persons
and families who obviously qualify for federally-assisted
services to obtain those services without a demeaning
scrutiny of their personal affairs. It will also eliminate
unnecessary and costly administrative trappings for many
service programs, thereby freeing more Federal and State
funds for the actual delivery of services.
H.R. 12455 embodies in part, still another central
element of my Federal Assistance for Community Services
proposal: that States should no longer be required to
match their share of the Federal Title XX social service
3
funds with State and local tax dollars. Under this bill,
as much as $200 million in new Title XX funds would be
distributed in fiscal year 1977 without a requirement for
State matching, if States choose to spend that amount for
child day care services. I am hopeful that this tentative
step indicates the willingness of the Congress to consider
seriously the elimination of the matching requirement for
all Federal social services funds under Title XX.
I do have serious reservations about the amount of
additional Federal funding provided in H.R. 12455, although
it is less than the amount in the bill I earlier vetoed.
It is also unfortunate that this bill, for the first time
under Title XX, designates levels of funding for specified
purposes. This is the antithesis of the spirit and intent
of Title XX which permits States the maximum flexibility to
determine their own priorities in using their share of
Federal social services funds. I am also concerned that the
tchild care provisions of this bill have not been adequately
coordinated with child care provisions in the pending tax
reform bill.
Much remains to be done to help the States improve
their delivery of social services funded under Title XX.
I am gratified that the Congress, in this bill, has moved
in some measure toward accepting concepts in my proposed act
to
Assistance for Community Services M. Further
action is needed, however, to provide more comprehensive
reform that will provide States the tools and flexibility
to deliver social services to those in need without cumber-
some Federal regulation. I again urge the Congress to act
promptly to give my proposal a full and favorable hearing.
STATEMENT BY THE PRESIDENT
I have today signed into law H.R. 12455, a bill
concerning child day care staffing standards and social
services supported with Federal financial assistance. En-
suring adequate day care for children is an important social
service. It protects the well-being of thousands of American
children -- and the economic independence of their working
parents. The integrity of the family is of paramount impor-
tance but supportive government action is acceptable as long
as it does not interfere with the family role.
Earlier this year, I vetood the predecessor version of
this bill, H.R. 9803 -- not because I disagreed with its
goals -- but because that bill was the wrong means to a
worthwhile end. The Congress sustained my veto. Today I
have signed a new and better child day care bill -- the result
of compromise and cooperation between the Congress and my
Administration. H.R. 12455 embodies a major compromise on a
key issue which led to that veto -- the imposition on States
and localities of costly and controversial Federal staffing
requirements for child day care services funded under Title XX
of the Social Security Act.
H.R. 9803 would have imposed these standards effective
July 1 of this year. Had that bill become law, it would have
brought about an unwarranted Federal preemption of State and
local responsibility to ensure quality day care services.
H.R. 12455, by postponing the Federal standards until
October 1, 1977, will enable the States to operate day care
programs for more than another year free of onerous and costly
Federal intrusion, while HEW completes a required major study
and report with recommendations on the day care standards.
In addition, the Congress will have the opportunity to act
on my proposed "Federal Assistance for Community Services
Act," submitted to the Congress last February to reform the
Title XX social services program.
2
My proposal would provide the States with the oppor-
tunity to administer the Title XX program with the necessary
flexibility to meet their most pressing needs as they
themselves determine those needs. It would simplify
program operations and remove many of the burdensome and
restrictive Federal requirements so that social services
can be provided in the most efficient and effective manner,
and can be most responsive to the needs of our citizens.
As part of this overall approach, it would require the
States to adopt and enforce their own standards for
federally-assisted child day care.
While I am disappointed that the Congress has not, in
H.R. 12455, clearly placed this responsibility and authority
in the States, the bill's lengthy suspension of the standards
is a positive step toward this objective.
H.R. 12455 does adopt a concept contained in my
Federal Assistance to Community Services proposal by
permitting States to provide Title XX services on a "group
eligibility" basis, except for most child day care services.
Under this bill, States will not have to require that senior
citizens and other persons who need and depend on social
services programs be subjected to individual income and
assets tests in order to determine whether they can parti-
cipate in these programs. Such persons will be eligible
as members of groups, when the States can reasonably assume
that substantially all those to be served have incomes less
than 90% of the State's median income.
This provision will make it possible for older persons
and families who obviously qualify for federally-assisted
services to obtain those services without a demeaning
scrutiny of their personal affairs. It will also eliminate
3
unnecessary and costly administrative trappings for many
service programs, thereby freeing more Federal and State
funds for the actual delivery of services.
H.R. 12455 embodies, in part, still another central
element of my Federal Assistance for Community Services
proposal: that States should no longer be required to
match their share of the Federal Title XX social service
funds with State and local tax dollars. Under this bill,
as much as $200 million in new Title XX funds would be
distributed in fiscal year 1977 without a requirement for
State matching, if States choose to spend that amount for
child day care services. I am hopeful that this tentative
step indicates the willingness of the Congress to consider
seriously the elimination of the matching requirement for
all Federal social services funds under Title XX.
I do have serious reservations about the amount of
additional Federal funding provided in H.R. 12455, although
it is less than the amount in the bill I earlier vetoed.
It is also unfortunate that this bill, for the first time
under Title XX, designates levels of funding for specified
purposes. This is the antithesis of the spirit and intent
of Title XX which permits States the maximum flexibility to
determine their own priorities in using their share of
Federal social services funds. I am also concerned that the
child care provisions of this bill have not been adequately
coordinated with child care provisions in the pending tax
reform bill.
Much remains to be done to help the States improve
their delivery of social services funded under Title XX.
I am gratified that the Congress, in this bill, has moved
in some measure toward accepting concepts in my proposed
4
act to provide financial assistance for community services.
Further action is needed, however, to provide more comprehensive
reform that will provide States the tools and flexibility
to deliver social services to those in need without cumber-
some Federal regulation. I again urge the Congress to act
promptly to give my proposal a full and favorable hearing.
EXECUTIVE OFFICE OF THE PRESIDENT
OFFICE OF MANAGEMENT AND BUDGET
WASHINGTON. D.C. 20503
SEP 2 1976
EMORANDUM FOR THE PRESIDENT
Subject: Enrolled Bill H.R. 12455 - Child Day Care and
Social Services Amendments
Sponsor - Rep. Corman (D) California and 7
others
Last Day for Action
September 7, 1976--Tuesday
Purpose
Postpones until October 1, 1977, enforcement of Federal
child day care staffing standards required under the
Title XX social services program; increases the $2.5 billion
annual ceiling on Title XX funding by $240 million through
September 30, 1977, earmarked for child day care services;
provides incentives for employment of welfare recipients by
child day care providers; provides group eligibility for
social services; and makes other changes in Title XX of
the Social Security Act.
Agency Recommendations
Office of Management and Budget
Approval (Signing
statement
attached)
Department of Health, Education, and
Approval (Signing
Welfare
statement
attached)
Council of Economic Advisers
Disapproval (Veto
message attached)
Department of the Treasury
No objection and
defers to other
agencies
Department of Labor
Defers to other
agencies
Discussion
H.R. 12455 is successor legislation to H.R. 9803, the child
day care services legislation which you vetoed on April 6,
1976. That veto was sustained by the Senate (60-34) on
May 5, 1976, after being overridden by the House (301-101).
STATEMENT BY THE PRESIDENT
I have today signed into law H.R. 12455, a bill
concerning child day care staffing standards and
social services supported with Federal financial assis-
tance.
Earlier this year, I vetoed the predecessor version
of this bill, H.R. 9803, and the Congress sustained my
veto. I have signed H.R. 12455 because it embodies a
major compromise on a key issue which led to that veto--
the imposition on States and localities of costly and
controversial Federal staffing requirements for child
day care services funded under Title XX of the Social
Security Act.
H.R. 9803 would have imposed these standards effective
July 1 of this year. Had that bill become law, it would
have brought about an unwarranted Federal preemption of
State and local responsibility to ensure quality day care
services.
H.R. 12455, by postponing the Federal standards until
October 1, 1977, will enable the States to operate day care
programs for more than another year free of onerous and
costly Federal intrusion, while HEW completes a required
major study and report with recommendations on the day
care standards. In addition, the Congress will have the
opportunity to act on my proposed "Federal Assistance for
Community Services Act," submitted to the Congress last
February to reform the Title XX social services program.
My proposal would provide the States with the opportu-
nity to administer the Title XX program with the necessary
flexibility to meet their most pressing needs as they
themselves determine those needs. It would simplify
program operations and remove many of the burdensome and
restrictive Federal requirements so that social services
can be provided in the most efficient and effective manner,
and can be most responsive to the needs of our citizens.
As part of this overall approach, it would require the
States to adopt and enforce their own standards for feder-
ally-assisted child day care.
While I am disappointed that the Congress has not, in
H.R. 12455, clearly placed this responsibility and authority
in the States, the bill's lengthy suspension of the standards
is a positive step toward this objective.
H.R. 12455 does adopt a concept contained in my Federal
Assistance to Community Services proposal by permitting
States to provide Title XX services on a "group eligibility"
basis, except for most child day care services. Under this
bill, States will not have to require that senior citizens
and other persons who need and depend on social services
programs be subjected to individual income and assets tests
in order to determine whether they can participate in
these programs. Such persons will be eligible as members
of groups, when the States can reasonably assume that
substantially all those to be served have incomes less than
90% of the State's median income.
This provision will make it possible for older persons
and families who obviously qualify for federally-assisted
services to obtain those services without a demeaning
scrutiny of their personal affairs. It will also eliminate
unnecessary and costly administrative trappings for many
service programs, thereby freeing more Federal and State
funds for the actual delivery of services.
H.R. 12455 embodies in part still another central
element of my Federal Assistance for Community Services
proposal: that States should no longer be required to
match their share of the Federal Title XX social service
funds with State and local tax dollars. Under this bill,
as much as $200 million in new Title XX funds would be
distributed in fiscal year 1977 without a requirement for
State matching, if States choose to spend that amount for
child day care services. I am hopeful that this tentative
step indicates the willingness of the Congress to consider
seriously the elimination of the matching requirement for
all Federal social services funds under Title XX.
I do have serious reservations about the additional
Federal funding provided in H.R. 12455, although it is less
than the amount in the bill I earlier vetoed. It is also
unfortunate that this bill, for the first time under Title
XX, designates certain amounts of money for specified
purposes. This is the antithesis of the spirit and intent
of Title XX to permit States the maximum flexibility to
determine their own priorities in using their share of
Federal social services funds. I am also concerned that the
child care provisions of this bill have not been adequately
coordinated with child care provisions in the pending tax
reform bill.
Much remains to be done to help the States improve
their delivery of social services funded under Title XX.
I am gratified that the Congress, in this bill, has moved
in some measure toward accepting concepts in my proposed
Federal Assistance for Community Services Act. Further
action is needed, however, to provide more comprehensive
reform that will provide States the tools and flexibility
to deliver social services to those in need without cumber-
some Federal regulation. I again urge the Congress to act
promptly to give my proposal a full and favorable hearing.
THE WHITE HOUSE
ACTION MEMORANDUM
WASHINGTON
LOG NO.:
Date:
Time:
September 3
821pm
FOR ACTION: Spencer Johnson
no
CC (for information):
Jack Marsh
Sarah Massengale
qq
Ed Schmults
Ken Lazarus 0
Bill Seidman
on
Jim Connor
Max Friederddorf
Robert Hartmann
Jean Halm the
FROM THE STAFF SECRETARY
DUE: Date: September 3
Time: 100pm
SUBJECT:
H.R. 12455-Child Day Care and Social Services -
Amendments -
ACTION REQUESTED:
For Necessary Action
For Your Recommendations
Prepare Agenda and Brief
Draft Reply
X For Your Comments
Draft Remarks
REMARKS:
please return to judy johnston, ground floor west wing
PLEASE ATTACH THIS COPY TO MATERIAL SUBMITTED.
If you have any questions or if you anticipate a
delay in submitting the required material, please
K. R. COLE, JR.
telephone the Staff Secretary immediately.
For the President
LOC
STATEMENT BY THE PRESIDENT
I have today signed into law H.R. 12455, a bill
concerning child day care staffing standards and
social services supported with Federal financial assis-
tance.
Earlier this year, I vetoed the predecessor version
of this bill, H.R. 9803, and the Congress sustained my
veto. I have signed H.R. 12455 because it embodies a
major compromise on a key issue which led to that veto--
the imposition on States and localities of costly and
controversial Federal staffing requirements for child
day care services funded under Title XX of the Social
Security Act.
H.R. 9803 would have imposed these standards effective
9/3/71
July 1 of this year. Had that bill become law, it would
7/3/71
have brought about an unwarranted Federal preemption of
State and local responsibility to ensure quality day care
services.
H.R. 12455, by postponing the Federal standards until
October 1, 1977, will enable the States to operate day care
programs for more than another year free of onerous and
costly Federal intrusion, while HEW completes a required
major study and report with recommendations on the day
care standards. In addition, the Congress will have the
opportunity to act on my proposed Federal'Assistance for
Community Services Act," submitted to the Congress last
February to reform the Title XX social services program.
My proposal would provide the States with the opportu-
nity to administer the Title XX program with the necessary
flexibility to meet their most pressing needs as they
themselves determine those needs. It would simplify
program operations and remove many of the burdensome and
LOG NO :
2
restrictive Federal requirements so that social services
can be provided in the most efficient and effective manner,
and can be most responsive to the needs of our citizens.
As part of this overall approach, it would require the
States to adopt and enforce their own standards for feder-
ally-assisted child day care.
While I am disappointed that the Congress has not, in
H.R. 12455, clearly placed this responsibility and authority
in the States, the bill's lengthy suspension of the standards
is a positive step toward this objective.
Financial
H.R. 12455 does adopt a concept contained in my Federal
Assistance to Community Services proposal by permitting
States to provide Title XX services on a "group eligibility"
basis, except for most child day care services. Under this
9/3/1
bill, States will not have to require that. senior citizens
7/3/7
and other persons who need and depend on social services
programs be subjected to individual income and assets tests
in order to determine whether they can participate in
these programs. Such persons will be eligible as members
of groups, when the States can reasonably assume that
substantially all those to be served have incomes less than
90% of the State's median income.
This provision will make it possible for older persons
and families who obviously qualify for federally-assisted
services to obtain those services without a demeaning
nity
scrutiny of their personal affairs. It will also eliminate
flex:
unnecessary and costly administrative trappings for many
thems
service programs, thereby freeing more Federal and State
progr
funds for the actual delivery of services.
H.R. 12455 embodies in part still another central
X
element of my Federal Emages Assistance for Community Services
proposal: that States should no longer be required to
match their share of the Federal Title XX social service
3
funds with State and local tax dollars. Under this bill,
as much as $200 million in new Title XX funds would be
distributed in fiscal year 1977 without a requirement for
State matching, if States choose to spend that amount for
child day care services. I am hopeful that this tentative
step indicates the willingness of the Congress to consider
seriously the elimination of the matching quiroment for
all Federal social services funds under Title XX.
amount of
I do have serious reservations about the additional
Federal funding provided in H.R. 12455, although it is less
than the amount in the bill I earlier vetoed. It is also
unfortunate that this bill, for the first time under Title
XX, designates cortain levels amount of for specified
purposes. This is the antithesis of the spirit and intent
of Title XX which to permits States the maximum flexibility to
determine their own priorities in using their share of
Federal social services funds. I am also concerned that the
child care provisions of this bill have not been adequately
coordinated with child care provisions in the pending tax
reform bill.
Much remains to be done to help the States improve
their delivery of social services funded under Title XX.
I am gratified that the Congress, in this bill, has moved
in some measure toward accepting concepts in my proposed
Foderal Assistance for Community Services Act. Further
action is needed, however, to provide more comprehensive
reform that will provide States the tools and flexibility
to deliver social services to those in need without cumber-
some Federal regulation. I again urge the Congress to act
promptly to give my proposal a full and favorable hearing.
OR M idented
Rec. 9/3/76 - 9:50 am
THE WHITE HOUSE
n
ACTION MEMORANDUM
WASHINGTON
:
LOG NO.:
Date: September 3
Time:
821am
FOR ACTION: Spencer Johnson
CC (for information): Jack Marsh
Sarah Massengale
Ed Schmults
Ken Lazarus
Bill Seidman
Jim Connor
Max Friedersdorf
Robert Hartmann
to RES
FROM THE STAFF SECRETARY
9-3 10:00
In
op
GAM
DUE: Date: September 3
qc
Time: 100pm
toojs
SUBJECT:
H.R. 12455-Child Day Care and Social Services 9.312:02
Amendments
carm
ACTION REQUESTED:
For Necessary Action
For Your Recommendations
Prepare Agenda and Brief
Draft Reply
X
For Your Comments
Draft Remarks
REMARKS:
please return to judy johnston, ground floor west wing
PLEASE ATTACH THIS COPY TO MATERIAL SUBMITTED.
If you have any questions or if you anticipate a
delay in submitting the required material, please
Counou
telephone the Staff Secretary immediately.
STATEMENT BY THE PRESIDENT
or
I have today signed op into law H.R. 12455, a bill
concerning child day care staffing standards and
social services supported with Federal financial assis-
tance.
Earlier this year I vetoed the predecessor version
ok
of this bill, H.R. 9803, and the Congress sustained my
veto. I have signed H.R. 12455 because it embodies a
major compromise on a key issue which led to that veto--
the imposition on States and localities of costly and
controversial Federal staffing requirements for child
ok
ok
day care services funded under Title XX of the Social
Security Act.
H.R. 9803 would have imposed these standards effective
July 1 of this year. Had that bill become law, it would
have brought about an unwarranted Federal preemption of
State and local responsibility to ensure quality day care
services.
OR
H.R. 12455, by postponing the Federal standards until
October 1, 1977, will enable the States to operate day care
programs for more than another year free of onerous and
costly Federal intrusion, while HEW completes a required
major study and report with recommendations on the day
care standards. In addition, the Congress will have the
FINANCIAL
ok
opportunity to act on my proposed "Federal Assistance for
Community Services op Act," submitted on to the Congress last
February to reform the Title XX social services program.
My proposal would provide the States with the opportu-
nity to administer the Title XX program with the necessary
flexibility to meet their most pressing needs as they
themselves determine those needs. It would simplify
program operations and remove many of the burdensome and
FORD LIBRARY
2
restrictive Federal requirements so that social services
can be provided in the most efficient and effective manner,
and can be most responsive to the needs of our citizens.
As part of this overall approach, it would require the
States to adopt and enforce their own standards for feder-
ally-assisted child day care.
While I am disappointed that the Congress has not, in
H.R. 12455, clearly placed this responsibility and authority
in the States, the bill's lengthy suspension of the standards
is a positive step toward this objective.
FINIANCIAL
H.R. 12455 does adopt a concept contained in my Federal
Assistance to Community Services proposal by permitting
States to provide Title XX services on a "group eligibility"
basis, except for most child day care services. Under this
bill, States will not have to require that senior citizens
and other persons who need and depend on social services
programs be subjected to individual income and assets tests
in order to determine whether they can participate in
these programs. Such persons will be eligible as members
of groups, when the States can reasonably assume that
substantially all those to be served have incomes less than
90% of the State's median income.
This provision will make it possible for older persons
and families who obviously qualify for federally-assisted
services to obtain those services without a demeaning
scrutiny of their personal affairs. It will also eliminate
unnecessary and costly administrative trappings for many
service programs, thereby freeing more Federal and State
funds for the actual delivery of services.
H.R. 12455 embodies in part still another central
FINANCIAL
element of my Federal Assistance for Community Services
proposal: that States should no longer OR be required to
match their share of the Federal Title XX social service
3
funds with State and local tax dollars Under this bill,
as much as $200 million in new Title XX funds would be
distributed in fiscal year 1977 without a requirement for
State matching, if States choose to spend that amount for
child day care services. I am hopeful that this tentative
step indicates the willingness of the Congress to consider
seriously the elimination of the matching requirement for
all Federal social services funds under Title XX.
Amount
I do have serious reservations about the additional
Federal funding provided in H.R. 12455, although it is less
than the amount in the bill I earlier vetoed. It is also
unfortunate that this bill, for the first time under Title
Levels of Funding
XX, designates certain amounts of money for specified
purposes. This is the antithesis of the spirit and intent
which
of Title XX to permit States the maximum flexibility to
determine their own priorities in using their share of
Federal social services funds. I am also concerned that the
child care provisions of this bill have not been adequately
coordinated with child care provisions in the pending tax
reform bill.
Much remains to be done to help the States improve
their delivery of social services funded under Title XX.
I am gratified that the Congress, in this bill, has moved
in some measure toward accepting concepts in my proposed
FINANCIAL
Federal Assistance for Community Services Act. Further
action is needed, however, to provide more comprehensive
reform that will provide States the tools and flexibility
to deliver social services to those in need without cumber-
some Federal regulation. I again urge the Congress to act
promptly to give my proposal a full and favorable hearing.
THE CHAIRMAN OF THE
COUNCIL OF ECONOMIC ADVISERS
WASHINGTON
August 31, 1976
Dear Mr. Frey:
This is in response to your request for
the Council of Economic Adviser's views on
H. R. 12455, to amend Title XX of the Social
Security Act. This Act is contrary to several
Administration objectives -- to better target
subsidies intended for the poor, to have a more
efficient allocation of workers among jobs, and
to limit the cost of Federal spending. For these
reasons, I recommend a Presidential veto. A
draft veto message is attached.
Sincerely,
Alan Greenspan
Mr. James Frey
Assistant Director for
Legislative Reference
Office of Management and Budget
Washington, D. C. 20503
AMERICANA REVOLUTION INTENTENNIAL
1776-1976
Draft Veto Message for H.R. 12455
Title XX of the Social Security Act provides Federal subsidies to
states (largely on a 75 percent Federal, 25 percent state cost-sharing
basis) for a wide variety of important social services. These include
day-care centers for children, meals and home-making aid for the aged,
assistance to the handicapped, foster care and adoption services, drug
and alcoholic treatment, etc. While I support these efforts, my proposals
to provide block grants to the states for social services have not been
enacted. The provisions of H.R. 12455 would amend Title XX but in such a
way as to make it a less effective program in targeting aid to the poor,
but at the same time increase its costs. For these reasons, I have vetoed
H.R. 12455.
For most of the services provided under Title XX it is not impractical
to require a means test so that those in need will receive the benefits and
those who can provide for their own services will do SO. Yet this Act
would eliminate individual determination of eligibility for all services
(except most child care). Under the group eligibility requirement many
persons who do not have low income or assets could qualify for benefits.
I am concerned with increasing job opportunities for all persons,
including those on welfare. I am also concerned with reducing incentives
to get on welfare and with the most efficient allocation of workers among
jobs. The Act provides up to $5,000 per year in wage subsidies to child
services
care/providers for each welfare recipient employed. This may well have
-2-
the perverse effect of encouraging persons to go on welfare to be eligible
for the subsidy. It also means employment discrimination against persons
not on welfare. The providers of child care services may prefer to hire
a less effective worker simply to obtain the subsidy. The result could
be a decline in the quality of child care services.
Federal funding of social services has increased rapidly in the
last few years and is now at an annual rate of $2.5 billion. At a time
of increased concern for placing limits on the growth of Federal spending
it would be inappropriate for this program to be expanded by effectively
$240 million in FY 1977.
OF
THE
THE 1789 TREASURY
DEPARTMENT OF THE TREASURY
WASHINGTON, D.C. 20220
ASSISTANT SECRETARY
AUG 31 1976
Dear Sir:
This is in response to your August 26, 1976 request for
the views of the Treasury Department on the enrolled bill
H.R. 12455, An Act To amend title XX of the Social Security
Act so as to permit greater latitude by the States in estab-
lishing criteria respecting eligibility for social services,
to facilitate and encourage the implementation by States of
child day care services programs conducted pursuant to such
title, to promote the employment of welfare recipients in the
provision of child day care services, and for other purposes.
A similar bill, H.R. 9803, was vetoed by the President on
April 6, 1976.
Section 4 of this bill would amend the work incentive
(WIN) tax credit provisions of the Internal Revenue Code.
H.R. 9803 contained a provision that was identical with the
exception that the provision would expire a year earlier, on
October 1, 1976.
The WIN program was established in 1967 to provide job
training and employment opportunities to welfare recipients
as a method of removing them from the category of the hard-
core unemployed and, thus, from the welfare roll, and the
WIN tax credit provisions were adopted in 1971 as an incentive
to employers to participate in the WIN program. Under the
basic WIN tax credit provisions, an employer may obtain a tax
credit equal to 20 percent of wages paid to a WIN participant
during the first 12 months of his employment, if he is employed
for at least 2 years. The credit provisions apply only if the
Secretary of Labor certifies that the employee has been placed
in employment under a WIN program established under section
432 (b) (1) of the Social Security Act and has not displaced any
individual from employment.
The Tax Reduction Act of 1975 extended the WIN tax credit
to the employment of an individual who had been on welfare for
at least 90 days prior to employment, on condition that the
- 2 -
employment last at least 1 month, thus severing the tie to the
WIN program. The amendment was proposed by Senator Talmadge,
the original sponsor of the WIN program and the WIN tax credit,
because of dissatisfaction with the administration of the WIN
program.
The 1975 amendment was effective for wages paid after
March 29, 1975, for services rendered before July 1, 1976.
Section 4 of the bill would extend the 1975 amendment until
October 1, 1977, solely with respect to "an eligible employee
whose services are performed in connection with a child day care
services program of the taxpayer", and would limit to $1,000 the
maximum credit in any taxable year with respect to any such em-
ployee. In addition, the tax credit for wages paid to such an
employee would be creditable against the entire tax liability of
the employer rather than just the first $25,000 of tax liability
and 50 percent of tax liability in excess of $25,000, as pro-
vided in present law.
As we reported earlier on H.R. 9803, the Treasury Department
has serious questions regarding the effectiveness of the WIN tax
credit provisions as a device for remedying the problem of hard-
core unemployment. These provisions are estimated in the tax
expenditure budget to cost $10 million annually, which implies
$50 million in wages eligible for the credit and perhaps 10,000
employees, many of whom would presumably have been employed
whether or not the credit existed. In any event, the tax system
is not an apt mechanism for administering programs of such
limited scope, and this observation obviously applies with
particular force to the amendments that would be made by sec-
tion 4 of the bill. In all likelihood, the tax credit will
simply be a windfall in the few cases in which it will apply.
However, because this tax related provision is relatively
unimportant in relation to the bill as a whole, the Treasury
Department would have no objection to approval of the bill and
defers to those Departments more concerned with the main pro-
visions of the bill dealing with standards for child care
programs and the funding of such programs.
Sincerely yours,
Charles m. Walher
Charles M. Walker
by wange
Assistant Secretary
Director, Office of Management and Budget
Attention: Assistant Director for
Legislative Reference, Legislative
Reference Division
Washington, D.C. 20503
U.S. DEPARTMENT OF LABOR
OFFICE OF THE SECRETARY
WASHINGTON
AUG 31 1976
Honorable James T. Lynn
Director
Office of Management and Budget
Washington, D. C. 20503
Dear Mr. Lynn:
This is in response to your request for a report from this
Department on the enrolled enactment of H.R. 12455, a child
day care social services act.
This Department supports the principal objectives of this
legislation, to provide for increased child day care
opportunities SO that parents may more readily enter the
workforce, and to promote the employment of welfare recip-
ients in child day care facilities. However, with respect
to Presidential action on the specific provisions of
H.R. 12455, we defer to those agencies more directly
involved, such as the Departments of the Treasury, and
Health, Education, and Welfare.
Sincerely,
MoMohan
ACTING
Secretary of Labor
THE WHITE HOUSE
ACTION MEMORANDUM
WASHINGTON:
LOG NO.:
Date: September 3
Time:
821am
FOR ACTION: Spencer Johnson
CC (for information):
Jack Marsh
Sarah Massengale
Ed Schmults
Ken Lazarus
Bill Seidman
Jim Connor
Max Friedersdorf
Robert Hartmann
FROM THE STAFF SECRETARY
DUE: Date: September 3
Time: 100pm
SUBJECT:
H.R. 12455-Child Day Care and Social Services
Amendments
ACTION REQUESTED:
For Necessary Action
For Your Recommendations
Prepare Agenda and Brief
Draft Reply
X
For Your Comments
Draft Remarks
REMARKS:
please return to judy johnston, ground floor west wing
I fully concur that the President should
sign this # lill and prefer the sholement
prepared by OMB.
Jamesh
PLEASE ATTACH THIS COPY TO MATERIAL SUBMITTED.
If you have any questions or if you anticipate a
delay in submitting the required material, please
Cennon
telephone the Staff Secretary immediately.
THE WHITE HOUSE
ACTION MEMORANDUM
WASHINGTON
:
LOG NO.:
Date:
Time:
September 3
821am
FOR ACTION:
Spencer Johnson
CC (for information):
Jack Marsh
Sarah Massengale
Ed Schmults
Ken Lazarus
Bill Seidman
Jim Connor
Max Friedersdorf
Robert Hartmann
FROM THE STAFF SECRETARY
DUE: Date: September 3
Time: 100pm
SUBJECT:
H.R. 12455-Child Day Care and Social Services
Amendments
ACTION REQUESTED:
For Necessary Action
For Your Recommendations
Prepare Agenda and Brief
Draft Reply
X For Your Comments
Draft Remarks
REMARKS:
please return to judy johnston, ground floor west wing
I have received the material on H.R. 12455 and agree
with the decision made this morning for the President
to sign this bill. I have talked with Sarah Massengale
about a number of particulars, especially the postpone-
ment of the Federal staffing standards until October 1977
and the group eligibility provisions. I also will be
giving Sarah some thoughts on the signing statement
which she is workin on.
Bobbie Kilberg
CC: Phil Buchen
PLEASE ATTACH THIS COPY TO MATERIAL SUBMITTED.
If you have any questions or if you anticipate a
delay in submitting the required material, please
telephone the Staff Secretary immediately.
HOUSE
ACTION MEMORANDUM
WASHINGTON
LOG NO.:
Date:
Time:
September 3
821am
FOR ACTION:
Spencer Johnson
CC (for information):
Jack Marsh
Sarah Massengale
Ed Schmults
Ken Lazarus
Bill Seidman
Jim Connor
Max Friedersdorf
Robert Hartmann
FROM THE STAFF SECRETARY
DUE: Date: September 3
Time: 100pm
SUBJECT:
H.R. 12455-Child Day Care and Social Services
Amendments
ACTION REQUESTED:
For Necessary Action
For Your Recommendations
Prepare Agenda and Brief
Draft Reply
X For Your Comments
Draft Remarks
REMARKS:
please return to judy johnston, ground floor west wing
APPROVE
RBP
PLEASE ATTACH THIS COPY TO MATERIAL SUBMITTED.
If you have any questions or if you anticipate a
delay in submitting the required material, please
telephone the Staff Secretary immediately.
THE WHITE HOUSE
WASHINGTON
September 3, 1976
MEMORANDUM FOR:
JIM CAVANAUGH
FROM:
MAX L. FRIEDERSDORF m.b.
SUBJECT:
HR 12455 - Child Day Care and Social
Services Amendments
The Office of Legislative Affairs concurs with the agencies
that the subject bill be signed.
Attachments
STATEMENT BY THE PRESIDENT
I have today signed into law H.R. 12455, a bill
concerning child day care staffing standards and
social services supported with Federal financial assis-
tance.
Earlier this year, I vetoed the predecessor version
of this bill, H.R. 9803, and the Congress sustained my
veto. I have signed H.R. 12455 because it embodies a
major compromise on a key issue which led to that veto--
the imposition on States and localities of costly and
controversial Federal staffing requirements for child
day care services funded under Title XX of the Social
Security Act.
H.R. 9803 would have imposed these standards effective
July 1 of this year. Had that bill become law, it would
have brought about an unwarranted Federal preemption of
State and local responsibility to ensure quality day care
services.
H.R. 12455, by postponing the Federal standards until
October 1, 1977, will enable the States to operate day care
programs for more than another year free of onerous and
costly Federal intrusion, while HEW completes a required
major study and report with recommendations on the day
care standards. In addition, the Congress will have the
opportunity to act on my proposed "Federal Assistance for
Community Services Act," submitted to the Congress last
February to reform the Title XX social services program.
My proposal would provide the States with the opportu-
nity to administer the Title XX program with the necessary
flexibility to meet their most pressing needs as they
themselves determine those needs. It would simplify
program operations and remove many of the burdensome and
2
restrictive Federal requirements so that social services
can be provided in the most efficient and effective manner,
and can be most responsive to the needs of our citizens.
As part of this overall approach, it would require the
States to adopt and enforce their own standards for feder-
ally-assisted child day care.
While I am disappointed that the Congress has not, in
H.R. 12455, clearly placed this responsibility and authority
in the States, the bill's lengthy suspension of the standards
is a positive step toward this objective.
H.R. 12455 does adopt a concept contained in my Federal
Assistance to Community Services proposal by permitting
States to provide Title XX services on a "group eligibility"
basis, except for most child day care services. Under this
bill, States will not have to require that senior citizens
and other persons who need and depend on social services
programs be subjected to individual income and assets tests
in order to determine whether they can participate in
these programs. Such persons will be eligible as members
of groups, when the States can reasonably assume that
substantially all those to be served have incomes less than
90% of the State's median income.
This provision will make it possible for older persons
and families who obviously qualify for federally-assisted
services to obtain those services without a demeaning
scrutiny of their personal affairs. It will also eliminate
unnecessary and costly administrative trappings for many
service programs, thereby freeing more Federal and State
funds for the actual delivery of services.
H.R. 12455 embodies in part still another central
element of my Federal Assistance for Community Services
proposal: that States should no longer be required to
match their share of the Federal Title XX social service
3
funds with State and local tax dollars. Under this bill,
as much as $200 million in new Title XX funds would be
distributed in fiscal year 1977 without a requirement for
State matching, if States choose to spend that amount for
child day care services. I am hopeful that this tentative
step indicates the willingness of the Congress to consider
seriously the elimination of the matching requirement for
all Federal social services funds under Title XX.
I do have serious reservations about the additional
Federal funding provided in H.R. 12455, although it is less
than the amount in the bill I earlier vetoed. It is also
unfortunate that this bill, for the first time under Title
XX, designates certain amounts of money for specified
purposes. This is the antithesis of the spirit and intent
of Title XX to permit States the maximum flexibility to
determine their own priorities in using their share of
Federal social services funds. I am also concerned that the
child care provisions of this bill have not been adequately
coordinated with child care provisions in the pending tax
reform bill.
Much remains to be done to help the States improve
their delivery of social services funded under Title XX.
I am gratified that the Congress, in this bill, has moved
in some measure toward accepting concepts in my proposed
Federal Assistance for Community Services Act. Further
action is needed, however, to provide more comprehensive
reform that will provide States the tools and flexibility
to deliver social services to those in need without cumber-
some Federal regulation. I again urge the Congress to act
promptly to give my proposal a full and favorable hearing.