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CSHB 78(FIN) Detail
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CSHB 78(FIN): "An Act relating to certain licenses and applications for licenses for persons who are not in substantial compliance with orders, judgments, or payment schedules for child support; relating to the duty to support children of minor parents; relating to the program of aid to families with dependent children, including the payment of aid in the case of pregnant minors and minors who are parents and the maximum amount of assistance that may be granted; proposing special demonstration projects within the program of aid to families with dependent children and directing the Department of Health and Social Services to seek waivers from the federal government to implement the projects; amending Alaska Rule of Civil Procedure 90.3; and providing for an effective date."

00CS FOR HOUSE BILL NO. 78(FIN) 01 "An Act relating to certain licenses and applications for licenses for persons who 02 are not in substantial compliance with orders, judgments, or payment schedules 03 for child support; relating to the duty to support children of minor parents; 04 relating to the program of aid to families with dependent children, including the 05 payment of aid in the case of pregnant minors and minors who are parents and 06 the maximum amount of assistance that may be granted; proposing special 07 demonstration projects within the program of aid to families with dependent 08 children and directing the Department of Health and Social Services to seek 09 waivers from the federal government to implement the projects; amending Alaska 10 Rule of Civil Procedure 90.3; and providing for an effective date." 11 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 12 * Section 1. AS 25.27.060 is amended by adding new subsections to read: 13 (e) If the child's parents are both unmarried minors who have not had the 14 disabilities of minority removed under AS 09.55.590, an order of child support issued

01 by a court or agency shall be based on the 02 (1) percentages of physical custody exercised by the child's parents; 03 and 04 (2) incomes of the child's grandparents and parents. 05 (f) To the extent that (e) of this section applies, 06 (1) the child's grandparents are considered to have a duty to support the 07 child and are subject to laws, regulations, and court rules relating to support of the 08 child; and 09 (2) a grandparent who is determined under applicable agency 10 regulations and court rules to be the obligor for purposes of paying child support on 11 behalf of a grandchild is subject to all laws, regulations, and court rules applicable to 12 child support obligors. 13 (g) An order of support against a child's grandparent under (e) of this section 14 and a grandparent's duty to support a child under (f) of this section is terminated, 15 without the need for obtaining a modification of a child support order, when one of 16 the child's parents reaches the age of majority or has the disabilities of minority 17 removed under AS 09.55.590, whichever occurs earlier. However, to the extent that 18 a grandparent may have accrued arrearages, the grandparent remains an obligor subject 19 to this chapter. 20 * Sec. 2. AS 25.27 is amended by adding new sections to read: 21 Sec. 25.27.244. ADVERSE ACTION AGAINST DELINQUENT OBLIGOR'S 22 OCCUPATIONAL LICENSE. (a) The agency shall compile and maintain a list of 23 obligors who are not in substantial compliance with a support order or payment 24 schedule negotiated under (g)(1) of this section. The list must include the names, 25 social security numbers, dates of birth, and last known addresses of the obligors. The 26 list shall be updated by the agency on a monthly basis. 27 (b) The agency shall, on a monthly basis, provide a copy of the list to each 28 licensing entity through a computer-readable magnetic medium. A licensing entity 29 subject to this section shall implement procedures to accept and process the list. 30 Notwithstanding any other law to the contrary, a licensing entity may not issue or 31 renew a license for a person on the list except as provided in this section.

01 (c) Promptly after receiving an application from an applicant and before 02 issuing or renewing a license, a licensing entity shall determine whether the applicant 03 is on the most recent list provided by the agency. If the applicant is on the list, the 04 licensing entity shall immediately serve notice under (e) of this section of the licensing 05 entity's intent to withhold issuance or renewal of the license. The notice shall be 06 considered given when delivered personally to the obligor or deposited in the U.S. mail 07 addressed to the applicant's last known mailing address on file with the licensing 08 entity. 09 (d) A licensing entity shall issue a temporary license valid for a period of 150 10 days to an applicant whose name is on the list if the applicant is otherwise eligible for 11 a license. The temporary license may not be extended. Only one temporary license 12 may be issued during a regular license term and its validity shall coincide with the first 13 150 days of that license term. A license for the full or remainder of the license term 14 may be issued or renewed only upon compliance with this section. If a license or 15 application is denied under this section, funds paid by the applicant or licensee shall 16 be refunded by the licensing entity after retention of the temporary license fee, if any. 17 (e) Notices for use under (c) of this section shall be developed by each 18 licensing entity under guidelines provided by the agency and are subject to approval 19 by the agency. The notice must include the address and telephone number of the 20 agency and shall emphasize the necessity of obtaining a release from the agency as a 21 condition for the issuance or renewal of a license. The notice must inform an 22 applicant whose license is governed by (d) of this section that the licensing entity shall 23 issue a temporary license for 150 calendar days under (d) of this section if the 24 applicant is otherwise eligible and that, upon expiration of that time period, the license 25 will be denied unless the licensing entity has received a release from the agency. The 26 agency shall also develop a form that the applicant may use to request a review by the 27 agency. A copy of this form shall be included with each notice sent under (c) of this 28 section. 29 (f) The agency shall establish review procedures consistent with this section 30 to allow an applicant to have the underlying arrearage and relevant defenses 31 investigated, to provide an applicant information on the process of obtaining a

01 modification of a support order, or to provide an applicant assistance in the 02 establishment of a payment schedule on arrearages if the circumstances warrant. 03 (g) If the applicant wishes to challenge being included on the list, the applicant 04 shall submit to the agency a written request for review within 30 days after receiving 05 the notice under (c) of this section by using the form developed under (e) of this 06 section. Within 30 days after receiving a written request for review, the agency shall 07 inform the applicant in writing of the agency's findings. The agency shall immediately 08 send a release to the appropriate licensing entity and the applicant if any of the 09 following conditions is met: 10 (1) the applicant is found to be in substantial compliance with each 11 support order applicable to the applicant or has negotiated an agreement with the 12 agency for a payment schedule on arrearages and is in substantial compliance with the 13 negotiated agreement; if the applicant fails to be in substantial compliance with an 14 agreement negotiated under this paragraph, the agency shall send to the appropriate 15 licensing entity a revocation of any release previously sent to the entity for that 16 applicant; 17 (2) the applicant has submitted a timely request for review to the 18 agency, but the agency will be unable to complete the review and send notice of 19 findings to the applicant in sufficient time for the applicant to file a timely request for 20 judicial relief within the 150-day period during which the applicant's temporary license 21 is valid under (d) of this section; this paragraph applies only if the delay in completing 22 the review process is not the result of the applicant's failure to act in a reasonable, 23 timely, and diligent manner upon receiving notice from the licensing entity that the 24 applicant's name is on the list; 25 (3) the applicant has, within 30 days after receiving the agency's 26 findings following a request for review under (2) of this subsection, filed and served 27 a request for judicial relief under this section, but a resolution of that relief will not 28 be made within the 150-day period of the temporary license under (d) of this section; 29 this paragraph applies only if the delay in completing the judicial relief process is not 30 the result of the applicant's failure to act in a reasonable, timely, and diligent manner 31 upon receiving the agency's notice of findings; or

01 (4) the applicant has obtained a judicial finding of substantial 02 compliance. 03 (h) An applicant is required to act with diligence in responding to notices from 04 the licensing entity and the agency with the recognition that the temporary license 05 granted under (d) of this section will lapse after 150 days and that the agency and, 06 where appropriate, the court must have time to act within that 150-day period. An 07 applicant's delay in acting, without good cause, that directly results in the inability of 08 the agency to complete a review of the applicant's request or the court to hear the 09 request for judicial relief within the required period does not constitute the diligence 10 required under this section that would justify the issuance of a release. 11 (i) Except as otherwise provided in this section, the agency may not issue a 12 release if the applicant is not in substantial compliance with the order for support or 13 is not in substantial compliance with an agreement negotiated under (g)(1) of this 14 section. The agency shall notify the applicant in writing that the applicant may request 15 any or all of the following: (1) judicial relief from the agency's decision not to issue 16 a release or the agency's decision to revoke a release under (g)(1) of this section; (2) 17 a judicial determination of substantial compliance; (3) a modification of the support 18 order. The notice must also contain the name and address of the court in which the 19 applicant may file the request for relief and inform the applicant that the applicant's 20 name shall remain on the list if the applicant does not request judicial relief within 30 21 days after receiving the notice. The applicant shall comply with all statutes and rules 22 of court implementing this section. This section does not limit an applicant's authority 23 under other law to request an order to show cause or notice of motion to modify a 24 support order or to fix a payment schedule on arrearages accruing under a support 25 order or to obtain a court finding of substantial compliance with a support order. 26 (j) A request for judicial relief from the agency's decision must state the 27 grounds on which relief is requested and the judicial action shall be limited to those 28 stated grounds. Judicial relief under this subsection is not an appeal, and shall be 29 governed by court rules adopted to implement this section. Unless otherwise provided 30 by court rule, the court shall hold an evidentiary hearing within 20 calendar days of 31 the filing of service on the opposing party. The court's decision shall be limited to a

01 determination of each of the following issues: 02 (1) whether there is a support order or a payment schedule on 03 arrearages; 04 (2) whether the petitioner is the obligor covered by the support order; 05 and 06 (3) whether the obligor is in substantial compliance with the support 07 order or payment schedule. 08 (k) If the court finds that the obligor is in substantial compliance with the 09 support order or payment schedule, the agency shall immediately send a release under 10 (g) of this section to the appropriate licensing entity and the applicant. 11 (l) When the obligor is in substantial compliance with a support order or 12 payment schedule, the agency shall mail to the applicant and the appropriate licensing 13 entity a release stating that the applicant is in substantial compliance. The receipt of 14 a release shall serve to notify the applicant and the licensing entity that, for the 15 purposes of this section, the applicant is in substantial compliance with the support 16 order or payment schedule unless the agency, under (a) of this section, certifies 17 subsequent to the issuance of a release that the applicant is once again not in 18 substantial compliance with a support order or payment schedule. 19 (m) The agency may enter into interagency agreements with the state agencies 20 that have responsibility for the administration of licensing entities as necessary to 21 implement this section to the extent that it is cost effective to implement the 22 interagency agreements. The agreements shall provide for the receipt by the other 23 state agencies and licensing entities of federal funds to cover that portion of costs 24 allowable in federal law and regulation and incurred by the state agencies and licensing 25 entities in implementing this section. 26 (n) Notwithstanding any other provision of law, the licensing entities subject 27 to this section shall assess a fee for issuance of a temporary license under this section. 28 The licensing entity shall set the amount of the fee so that the fees collected under this 29 section cover the costs of implementing and administering this section. 30 (o) The process described in (g) of this section is the sole administrative 31 remedy for contesting the issuance to the applicant of a temporary license or the denial

01 of a license under this section. The procedures specified in AS 44.62.330 - 44.62.630 02 (Administrative Procedure Act) do not apply to the denial or failure to issue or renew 03 a license under this section. 04 (p) The agency and licensing entities, as appropriate, shall adopt regulations 05 necessary to implement this section. 06 (q) In this section, 07 (1) "applicant" means a person applying for issuance or renewal of a 08 license; 09 (2) "license" 10 (A) means, except as provided in (B) of this paragraph, a 11 license, certificate, permit, registration, or other authorization that, at the time 12 of issuance, will be valid for more than 150 days that may be acquired from 13 a state agency to perform an occupation, including the following: 14 (i) license relating to boxing or wrestling under 15 AS 05.10; 16 (ii) authorization to perform an occupation regulated 17 under AS 08; 18 (iii) teacher certificate under AS 14.20; 19 (iv) authorization under AS 18.08 to perform emergency 20 medical services; 21 (v) asbestos worker certification under AS 18.31; 22 (vi) boiler operator's license under AS 18.60.395; 23 (vii) certificate of fitness under AS 18.62; 24 (viii) hazardous painting certification under AS 18.63; 25 (ix) security guard license under AS 18.65.400 - 26 18.65.490; 27 (x) license relating to insurance under AS 21.27; 28 (xi) employment agency permit under AS 23.15.330 - 29 23.15.520; 30 (xii) registration as a broker-dealer, agent, or investment 31 adviser under AS 45.55.030;

01 (xiii) certification as a pesticide applicator under 02 AS 46.03.320; 03 (xiv) certification as a storage tank worker or contractor 04 under AS 46.03.375; and 05 (xv) certification as a water and wastewater works 06 operator under AS 46.30; 07 (B) does not include 08 (i) a vessel license issued under AS 16.05.490 or 09 16.05.530; 10 (ii) a commercial fishing license under AS 16.05.480, 11 including a crewmember fishing license; 12 (iii) an entry permit or interim-use permit issued under 13 AS 16.43; 14 (iv) a license issued under AS 47.35; 15 (v) a business license issued under AS 43.70; or 16 (vi) a driver's license issued under AS 28.15; 17 (3) "licensee" means a person holding a license or applying to renew 18 a license; 19 (4) "licensing entity" means the state agency that issues or renews a 20 license; in the case of a license issued or renewed by the Department of Commerce 21 and Economic Development after an applicant's qualifications are determined by 22 another agency, "licensing entity" means the department; 23 (5) "list" means the list of obligors compiled and maintained under (a) 24 of this section; 25 (6) "substantial compliance with a support order or payment schedule" 26 means that, with respect to a support order or a negotiated payment schedule under (g) 27 of this section, whichever is applicable, the obligor has no more than $2,500 past due 28 and has cumulatively paid an amount equal to or greater than the amount due for eight 29 months during the past 12 months; with respect to a support order or payment schedule 30 that has been in effect for less than one year, "substantial compliance" means that the 31 obligor has no more than $2,500 past due and has cumulatively paid an amount equal

01 to or greater than 67 percent of the amount due during the period the support order or 02 payment schedule has been in effect. 03 Sec. 25.27.246. ADVERSE ACTION AGAINST DELINQUENT OBLIGOR'S 04 DRIVER'S LICENSE. (a) The agency shall compile and maintain a list of obligors 05 who have a driver's license and are not in substantial compliance with a support order 06 or payment schedule negotiated under (f)(1) of this section. The list must include the 07 names, social security numbers, dates of birth, and last known addresses of the 08 obligors. The list shall be updated by the agency on a monthly basis. 09 (b) The agency shall serve notice under (d) of this section to each person on 10 the list that the person's driver's license will be suspended in 150 days, and will not 11 be reissued or renewed the next time it is applied for if the person's name is on the list 12 at the time of the subsequent application, unless the licensee receives a release from 13 the agency. The notice shall be considered given when delivered personally to the 14 obligor or deposited in the U.S. mail addressed to the obligor's last known mailing 15 address on file with the agency. 16 (c) If the licensee fails to obtain a release during the 150-day period following 17 notice under (b) and (d) of this section, the agency shall notify the department that the 18 licensee's driver's license should be suspended and further renewals or applications 19 should be denied until the agency sends the department a release for the licensee. 20 Upon receiving the agency's notice under this subsection, the department shall suspend 21 the licensee's driver's license and may not issue or renew a driver's license for the 22 licensee until the department receives a release to do so from the agency. If a license 23 or application is suspended or denied under this section, funds paid by the applicant 24 or licensee may not be refunded by the department. 25 (d) The notice under (b) of this section must include the address and telephone 26 number of the agency and shall emphasize the necessity of obtaining a release from 27 the agency as a condition for avoiding suspension or denial of the person's driver's 28 license. The notice must also inform the licensee that, if a license or application is 29 suspended or denied under this section, funds paid by the licensee will not be refunded 30 by the department. The agency shall also develop a form that the licensee may use 31 to request a review by the agency. A copy of this form shall be included with each

01 notice sent under (b) of this section. 02 (e) The agency shall establish review procedures consistent with this section 03 to allow a licensee to have the underlying arrearage and relevant defenses investigated, 04 to provide a licensee with information on the process of obtaining a modification of 05 a support order, or to provide a licensee with assistance in the establishment of a 06 payment schedule on arrearages if the circumstances warrant. 07 (f) If a licensee wishes to challenge being included on the list, the licensee 08 shall submit to the agency a written request for review within 30 days after the notice 09 under (b) of this section was personally delivered or postmarked by using the form 10 developed under (d) of this section. Within 30 days after receiving a written request 11 for review, the agency shall inform the licensee in writing of the agency's findings. 12 The agency shall immediately send a release to the department and the licensee if any 13 of the following conditions is met: 14 (1) the licensee is found to be in substantial compliance with each 15 support order applicable to the licensee or has negotiated an agreement with the agency 16 for a payment schedule on arrearages and is in substantial compliance with the 17 negotiated agreement; if the licensee fails to be in substantial compliance with an 18 agreement negotiated under this paragraph, the agency shall send to the department a 19 revocation of any release previously sent to the entity for that licensee; 20 (2) the licensee has submitted a timely request for review to the 21 agency, but the agency will be unable to complete the review and send notice of 22 findings to the licensee in sufficient time for the licensee to file a timely request for 23 judicial relief within the 150-day period before the licensee's license will be suspended 24 under (c) of this section; this paragraph applies only if the delay in completing the 25 review process is not the result of the licensee's failure to act in a reasonable, timely, 26 and diligent manner upon receiving notice from the agency that the licensee's driver's 27 license will be suspended in 150 days; 28 (3) the licensee has, within 30 days after receiving the agency's findings 29 following a request for review under (2) of this subsection, filed and served a request 30 for judicial relief under this section, but a resolution of that relief will not be made 31 within the 150-day period before license suspension under (c) of this section; this

01 paragraph applies only if the delay in completing the judicial relief process is not the 02 result of the licensee's failure to act in a reasonable, timely, and diligent manner upon 03 receiving the agency's notice of findings; or 04 (4) the licensee has obtained a judicial finding of substantial 05 compliance. 06 (g) A licensee is required to act with diligence in responding to notices from 07 the agency with the recognition that the person's driver's license will be suspended 08 after 150 days or that a subsequent license will not be issued and that the agency and, 09 where appropriate, the court must have time to act within that 150-day period or before 10 the subsequent license is needed, as applicable. A licensee's delay in acting, without 11 good cause, that directly results in the inability of the agency to complete a review of 12 the licensee's request or the court to hear the request for judicial relief within the 13 required period does not constitute the diligence required under this section that would 14 justify the issuance of a release. 15 (h) Except as otherwise provided in this section, the agency may not issue a 16 release if the applicant is not in substantial compliance with the order for support or 17 is not in substantial compliance with an agreement negotiated under (f)(1) of this 18 section. The agency shall notify the licensee in writing that the licensee may request 19 any or all of the following: (1) judicial relief from the agency's decision not to issue 20 a release or the agency's decision to revoke a release under (f)(1) of this section; (2) 21 a judicial determination of substantial compliance; (3) a modification of the support 22 order. The notice must also contain the name and address of the court in which the 23 licensee may file the request for relief and inform the licensee that the licensee's name 24 shall remain on the list if the licensee does not request judicial relief within 30 days 25 after receiving the notice. The licensee shall comply with all statutes and rules of 26 court implementing this section. This section does not limit a licensee's authority 27 under other law to request an order to show cause or notice of motion to modify a 28 support order or to fix a payment schedule on arrearages accruing under a support 29 order or to obtain a court finding of substantial compliance with a support order. 30 (i) A request for judicial relief from the agency's decision must state the 31 grounds on which relief is requested and the judicial action shall be limited to those

01 stated grounds. Judicial relief under this subsection is not an appeal, and shall be 02 governed by court rules adopted to implement this section. Unless otherwise provided 03 by court rule, the court shall hold an evidentiary hearing within 20 calendar days of 04 the filing of service on the opposing party. The court's decision shall be limited to a 05 determination of each of the following issues: 06 (1) whether there is a support order or a payment schedule on 07 arrearages; 08 (2) whether the petitioner is the obligor covered by the support order; 09 and 10 (3) whether the obligor is in substantial compliance with the support 11 order or payment schedule. 12 (j) If the court finds that the obligor is in substantial compliance with the 13 support order or payment schedule, the agency shall immediately send a release under 14 (f) of this section to the department and the licensee. 15 (k) When the obligor is in substantial compliance with a support order or 16 payment schedule, the agency shall mail to the applicant and the department a release 17 stating that the licensee is in substantial compliance. The receipt of a release shall 18 serve to notify the licensee and the department that, for the purposes of this section, 19 the applicant is in substantial compliance with the support order or payment schedule 20 unless the agency, under (a) of this section, certifies subsequent to the issuance of a 21 release that the licensee is once again not in substantial compliance with a support 22 order or payment schedule. 23 (l) The process described in (f) of this section is the sole administrative 24 remedy for contesting the suspension or the denial of a driver's license under this 25 section. The procedures specified in AS 28 or AS 44.62.330 - 44.62.630 26 (Administrative Procedure Act) do not apply to the suspension or failure to issue or 27 renew a license under this section. 28 (m) The agency and department, as appropriate, shall adopt regulations 29 necessary to implement this section. 30 (n) In this section, 31 (1) "department" means the Department of Public Safety;

01 (2) "driver's license" or "license" means a driver's license, as defined 02 in AS 28.40.100; 03 (3) "licensee" means a person holding or requesting a driver's license; 04 (4) "list" means the list of obligors compiled and maintained under (a) 05 of this section; 06 (5) "substantial compliance with a support order or payment schedule" 07 means that, with respect to a support order or a negotiated payment schedule under (f) 08 of this section, whichever is applicable, the obligor has no more than $2,500 past due 09 and has cumulatively paid an amount equal to or greater than the amount due for eight 10 months during the past 12 months; with respect to a support order or payment schedule 11 that has been in effect for less than one year, "substantial compliance" means that the 12 obligor has no more than $2,500 past due and has cumulatively paid an amount equal 13 to or greater than 67 percent of the amount due during the period the support order or 14 payment schedule has been in effect. 15 * Sec. 3. AS 47.25.360 is amended to read: 16 Sec. 47.25.360. GRANTING OF ASSISTANCE. Upon the completion of the 17 investigation, the department shall decide whether the child is eligible for assistance 18 under AS 47.25.310 - 47.25.420, the amount of assistance, and the date on which it 19 starts. The department shall notify the person having custody of the child of its 20 decision. Except as provided in AS 47.25.362(b), the [THE] assistance shall be paid 21 monthly to the person having custody of the child upon order of the department. 22 * Sec. 4. AS 47.25 is amended by adding a new section to read: 23 Sec. 47.25.362. ASSISTANCE TO MINORS WITH CHILDREN. (a) Except 24 as provided in (c) of this section, the department shall require, as a condition of 25 eligibility for assistance, that a minor parent must reside in a 26 (1) place of residence maintained by the minor's parent, legal guardian, 27 or other adult relative of the minor as the parent's, guardian's, or other relative's own 28 home; or 29 (2) foster home, maternity home, or other adult-supervised supportive 30 living arrangement. 31 (b) Notwithstanding AS 47.25.360, the department shall, where possible, pay

01 assistance on behalf of a minor parent who is subject to the requirements of (a) of this 02 section to the minor's parent, legal guardian, or other adult relative, or, as applicable, 03 to the head of the adult-supervised supportive living arrangement where the minor 04 parent resides. 05 (c) The provisions of (a) and (b) of this section do not apply if 06 (1) the minor parent does not have a parent or legal guardian who is 07 living and whose whereabouts is known; 08 (2) a living parent or legal guardian of the minor parent will not allow 09 the minor to live in the home of the parent or guardian; 10 (3) the department determines that the physical or emotional health or 11 safety of the minor parent or the minor's child would be jeopardized if the minor and 12 the minor's child lived in the same residence with the minor's parent or guardian; 13 (4) the minor parent lived apart from the minor's parent or legal 14 guardian for either one year before the birth of the dependent child or one year before 15 the minor parent submitted the application for assistance; or 16 (5) the department otherwise determines under regulations that are 17 consistent with corresponding federal regulations that there is good cause for waiving 18 the requirements of (a) of this section in the case of a particular minor parent. 19 (d) In this section, "minor parent" means a person who is under the age of 18, 20 who has never married, and is either 21 (1) the natural parent of a dependent child living in the same 22 household; or 23 (2) eligible for assistance as a pregnant woman. 24 * Sec. 5. AS 47.25.310(c) is repealed. 25 * Sec. 6. COURT RULE CHANGE. (a) AS 25.27.060 (e) - (g), added by sec. 1 of this 26 Act, have the effect of amending Alaska Rule of Civil Procedure 90.3 by requiring 27 consideration of the income of the grandparents of a child when determining a child support 28 obligation under certain circumstances and by providing that a child's grandparents are 29 obligated to support the child under certain circumstances. 30 (b) Under art. IV, sec. 15, Constitution of the State of Alaska, AS 25.27.060(e) - (g), 31 added by sec. 1 of this Act, and this section may become law with the affirmative vote of a

01 majority of the membership of each house because the court rule being amended is not a rule 02 governing practice or procedure. 03 * Sec. 7. REPORT. (a) In furtherance of the public policy of increasing child support 04 enforcement and collections, on or before January 1, 1998, the child support enforcement 05 agency shall make a report to the legislature and the governor based on data collected by the 06 licensing entities and the agency in a format prescribed by the agency. The report must 07 contain 08 (1) the number of delinquent obligors on the lists maintained by the agency 09 under AS 25.27.244 - 25.27.246, enacted by sec. 2 of this Act; 10 (2) the number of delinquent obligors who also were applicants or licensees 11 subject to AS 25.27.244 - 25.27.246, enacted by sec. 2 of this Act; 12 (3) the number of new licenses and renewals that were delayed or denied and 13 temporary licenses issued subject to AS 25.27.244 and the number of new licenses and 14 renewals granted following receipt by licensing entities of releases under AS 25.27.244 by 15 July 1, 1997; 16 (4) the number of licenses under AS 28.15 that were suspended under 17 AS 25.27.246 and the number of licenses under AS 28.15 that were reinstated following 18 receipt by the Department of Public Safety of releases under AS 25.27.246 by July 1, 1997; 19 and 20 (5) the costs incurred in the implementation and enforcement of AS 25.27.244 21 - 25.27.246, enacted by sec. 2 of this Act. 22 (b) A licensing entity receiving an inquiry from the agency under (a) of this section 23 shall cooperate with the agency. When queried as to the licensed status of an applicant who 24 has had a license denied or suspended under AS 25.27.244 or 25.27.246 or has been granted 25 a temporary license under AS 25.27.244, the licensing entity shall respond only that the 26 license was denied or suspended or that the temporary license was issued. 27 * Sec. 8. WAIVER APPLICATION. (a) The Department of Health and Social Services 28 shall, by February 15, 1996, seek appropriate waivers from the federal government to 29 implement the AFDC demonstration projects described in secs. 9 - 13 of this Act. To the 30 extent that the federal government approves the necessary waivers, the department shall 31 implement the projects. The purposes of the projects are to promote personal responsibility

01 and self-sufficiency. 02 (b) At a minimum, the department shall implement secs. 10 - 13 of this Act as four 03 separate projects in four different areas of the state, with at least one project in a municipality 04 with a population over 25,000, one in a municipality with a population between 5,000 and 05 25,000, and one in a municipality or community with a population under 5,000. If the 06 department determines that more than one project can be efficiently and usefully operated in 07 the same area at the same time the department may operate more than one project in the same 08 area as a fifth project, subject to federal approval of the appropriate waivers. 09 (c) Notwithstanding (a) of this section, if changes in federal statutes or regulations 10 occur after the effective date of this section and would have a major effect on the design, 11 implementation, or operation of the project, the department shall 12 (1) apply for and implement only the waivers that relate to the parts of the 13 project that are not substantially affected by the changes in federal statutes or regulations; if 14 the department determines that the parts of the project that are not substantially affected by 15 the federal changes do not comprise a fiscally responsible project, the department is not 16 required to apply for or implement waivers under this Act and may discontinue operation of 17 the project under waivers that were implemented before the federal changes occurred; 18 (2) report to the legislature its recommendations for changes in its statutory 19 authority that may be needed in order to implement a fiscally responsible project in light of 20 conflicting or permissive changes in federal statutes or regulations. 21 * Sec. 9. EARNED INCOME DISREGARD; WAIVER OF "100-HOUR" RULE; AUTO 22 ALLOWANCE. When determining the AFDC eligibility of a family that is participating in 23 a project under secs. 10 - 12 of this Act and when determining the amount of assistance to 24 which the family is entitled, the department shall 25 (1) disregard, for 24 months, $200 plus one-third of the remainder of the 26 earned income of each person in the family unless federal regulations require that more earned 27 income of a person must be disregarded; for a family that applies for AFDC after this 28 paragraph has been implemented, this 24 months begins with the month for which the family 29 is first granted AFDC; for a family that is already receiving assistance when this paragraph 30 is implemented, this 24 months begins with the first month during which this paragraph is 31 implemented;

01 (2) waive the requirement that, for purposes of assistance for a dependent child 02 of unemployed parents, the principal wage-earning parent must be employed less than 100 03 hours a month; and 04 (3) allow the exclusion of $5,000 of the combined equity of motor vehicles 05 used by the family for basic family transportation, transportation of a disabled child in the 06 household, or transportation of a member of the family to or from employment, training, or 07 participation in an activity required under secs. 10 - 11 of this Act; if the combined equity of 08 vehicles described in this paragraph exceeds $5,000, the department shall apply the excess 09 equity amount toward the asset limit otherwise applicable to the family. 10 * Sec. 10. WORKFARE. (a) The department shall operate a workfare project. Each 11 member of a family in the workfare project area who is 18 years of age or older shall 12 participate for 21 hours a week in an uncompensated activity if assigned to the activity by the 13 department. The department shall assess the availability of activities that satisfy the purposes 14 of this subsection in the project area and attempt to develop additional activities where 15 necessary. When assessing the availability of activities that are suitable as uncompensated 16 activities under this section and in assigning persons to those activities, the department shall 17 consider activities recommended by governmental representatives of boroughs, cities, and 18 communities and others in the project area. The activities may include provision of child care 19 for other project participants, community work experience, work-related training programs, 20 high school completion, GED programs, or culturally relevant subsistence activities. The 21 department shall penalize the family for failure of a person to comply with this subsection by 22 disregarding that person as a member of the family for purposes of determining the amount 23 of AFDC assistance given to the family. 24 (b) If organizations exist in the project area that have had successful experience in 25 conducting employment placement services, community services, and job training programs, 26 the department shall offer on a competitive basis contracts to those organizations to administer 27 (a) of this section. A contract under this subsection must provide that the department shall 28 make the determinations required under (c) and (d) of this section and the contractor shall 29 perform the duties assigned to the department under (a) of this section with respect to 30 uncompensated activities, including assessment of their availability, development of additional 31 activities, consideration of activities recommended by governmental representatives, and

01 assignment of persons to specific activities after referral of those persons to the contractor by 02 the department. The department may, after consultation with the appropriate contractor under 03 this subsection, if any, 04 (1) provide AFDC benefits to participant families in amounts and forms the 05 department determines are appropriate to the circumstances of the family; 06 (2) use AFDC benefits to subsidize payments or provide services to 07 participants in community work projects or work training projects; an amount distributed as 08 a subsidy under this paragraph is not considered to be wages; and 09 (3) deny AFDC benefits to a family that fails to cooperate with services 10 offered and activities required under the pilot project; a family denied benefits under this 11 paragraph may appeal that determination to the department under AS 47.25.370 for review of 12 whether the denial was appropriate under department regulations governing administration of 13 the project. 14 (c) The requirement to participate in an uncompensated activity under (a) of this 15 section does not apply to a person who 16 (1) has paid employment of at least 15 hours a week; a person who has paid 17 employment of less than 15 hours a week shall participate in an uncompensated activity 18 assigned under (a) of this section for the number of hours that, when added to the hours of 19 paid employment, equals 21; 20 (2) is exempt from participating in an activity under AS 47.25.421 - 47.25.429 21 (JOBS program); 22 (3) is enrolled as a full-time student in good standing in a career education 23 program, college, or university, as defined in regulations adopted under AS 14.43; 24 (4) is the parent or other relative of a child under six years of age living in the 25 same household who personally provides care for the child; 26 (5) is determined, according to regulations of the department, to be physically 27 or mentally unable to perform any reasonable activity that may be assigned under this section; 28 or 29 (6) is a parent who is providing care for a child with a developmental disability 30 as defined by AS 47.80.900. 31 (d) Notwithstanding (a) of this section, the department may not require a person to

01 participate in an uncompensated activity under (a) of this section unless the department agrees 02 to pay for 03 (1) costs of child care determined by the department to be necessary for the 04 person's participation; and 05 (2) transportation expenses determined by the department to be necessary for 06 the person's participation in the activity. 07 (e) In this section, "project area" means the area chosen by the department in which 08 to operate the workfare project described in this section. 09 * Sec. 11. AFDC UNEMPLOYED PARENT PROJECT. (a) The Department of Health 10 and Social Services shall operate a transition-to-work project that is designed to assist two-parent families receiving 11 assistance under the Aid to Families with Dependent Children 12 (AFDC) program to achieve economic self-sufficiency within three years after the date of 13 entry into the project. To this end, the department shall develop, with each participating 14 family, an individual family plan for achieving self-support and shall enter into a contract with 15 that family that identifies 16 (1) the services that the department will provide to enable the family to achieve 17 self-support; 18 (2) the activities that the family will participate in to prepare for self-sufficiency; 19 (3) specific benchmarks to indicate the steps toward successful completion of 20 the family plan; 21 (4) an agreement that cash assistance benefits under the AFDC program will 22 be available to the family for no more than 36 months during the period from the effective 23 date of this section to June 30, 2001; 24 (5) an acknowledgment that medical assistance benefits under AS 47.07 may 25 be available as long as the family is otherwise eligible under the AFDC program; and 26 (6) an acknowledgement that failure to comply with the terms of a family plan 27 developed under this section or failure to meet a benchmark of the plan may result in a 28 finding of noncooperation and a modification or denial of AFDC benefits to the family. 29 (b) The services and referrals to be provided by the department and the activities to 30 be included in a family plan may include 31 (1) child care services;

01 (2) uncompensated community work experience; 02 (3) work-related training programs; 03 (4) high school completion or GED programs; 04 (5) provision of child care for other project participants; 05 (6) culturally relevant subsistence activities; 06 (7) placement in paid employment; and 07 (8) referral to other services and programs that may improve the family's 08 employability or self-sufficiency. 09 (c) The department shall deny AFDC benefits to a family that is assigned to 10 participate in the project under this section if the family fails to cooperate in the development 11 of a family plan or fails to sign a family contract as required by (a) of this section. A family 12 assigned to participate in the project under this section that is denied AFDC benefits under 13 this subsection shall be provided the opportunity for a fair hearing under AS 47.25.370 to 14 determine whether benefits were properly denied under the statutes and regulations governing 15 the project. 16 (d) To the extent that a provision of this section is inconsistent with a provision of 17 AS 47.25.310 - 47.25.429, the provision of this section governs. 18 * Sec. 12. SELF-EMPLOYMENT PROJECT. (a) The Department of Health and Social 19 Services shall operate a self-employment demonstration project for the purpose of allowing 20 individual recipients of Aid to Families with Dependent Children (AFDC) assistance under 21 AS 47.25.310 - AS 47.25.429 to reduce their need for public assistance by establishing and 22 operating a microenterprise. Under the self-employment demonstration project, a recipient 23 may accumulate certain resources needed to acquire business skills or to establish and operate 24 a microenterprise without becoming ineligible for AFDC assistance. 25 (b) An AFDC recipient who wishes to participate in the self-employment 26 demonstration project under this section shall request from the department a referral to a 27 nonprofit business development organization for an assessment of the recipient's capacity for 28 self-employment and the economic viability of the microenterprise contemplated by the 29 recipient. After review of the request, the department may provide the referral. 30 (c) An AFDC recipient who wishes to participate in the self-employment 31 demonstration project and has been referred for an assessment under (b) of this section shall

01 formulate a business plan for the microenterprise. The recipient shall submit the business plan 02 to the nonprofit business development organization for review and then submit the reviewed 03 business plan to the department for approval. 04 (d) For purposes of determining a recipient's eligibility for AFDC assistance, for the 05 first 36 months after the initial approval by the department of the recipient's business plan for 06 a microenterprise, the department shall 07 (1) disregard up to $10,000 in microenterprise assets set aside for the 08 development or operation of the microenterprise in accordance with the approved plan; 09 (2) disregard up to $500 each month in nonbusiness income set aside for the 10 development or operation of the microenterprise; and 11 (3) determine the recipient's income based on the net business income received 12 from the recipient's microenterprise. 13 (e) At 12-month intervals, a recipient whose business plan for a microenterprise has 14 been approved shall submit to the department a review of the financial records of the 15 microenterprise, signed by an accountant or bookkeeper, and verified by the nonprofit business 16 development organization that conducted the recipient's assessment under (b) of this section. 17 The cost of record review shall be considered a business expense of the recipient's 18 microenterprise. 19 (f) To the extent that a provision of this section is inconsistent with a provision of 20 AS 47.25.310 - 47.25.429, the provision of this section governs. 21 (g) In this section, 22 (1) "business income" means all income derived from the use of 23 microenterprise assets in a microenterprise; 24 (2) "employees" means the operator of a microenterprise and any persons 25 employed in the operation of the business; 26 (3) "microenterprise" means a business enterprise that has fewer than five 27 employees; 28 (4) "microenterprise assets" means all of the following: 29 (A) business loans; 30 (B) capital equipment; 31 (C) inventory; and

01 (D) all other assets required for the operation of the microenterprise; 02 (5) "net business income" means all business income minus all of the 03 following: 04 (A) business loan payments; 05 (B) business taxes; 06 (C) expenditures for vehicles vital to the business operations; 07 (D) cash retained in the microenterprise; 08 (E) insurance expenditures; 09 (F) inventory raw material expense; 10 (G) transportation expenditures; 11 (H) office supplies; 12 (I) professional services, including accounting, legal, or other consulting 13 services; 14 (J) delivery charges and supplies; 15 (K) commissions, salaries, wages, and other employment benefits, 16 including dental and vision care; 17 (L) postage; 18 (M) rent; 19 (N) utilities; 20 (O) telephone expenses; 21 (P) advertising and other marketing and promotional costs; and 22 (Q) training and professional development expenses. 23 * Sec. 13. DIVERSION PROJECT. (a) The Department of Health and Social Services 24 shall operate a diversion project that is designed to increase family income through 25 employment and child support payments by offering lump-sum diversion payments in place 26 of ongoing financial assistance under the Aid to Families with Dependent Children (AFDC) 27 program. A diversion payment may be offered to an applicant for AFDC who is job-ready 28 and who needs short-term financial assistance to meet critical needs in order to secure 29 employment and support for the applicant's family. 30 (b) Diversion project benefits may be paid only to an applicant's family that appears, 31 based on the information provided to the department on an AFDC application, to be eligible

01 for AFDC benefits and to include a job-ready individual. The department may offer, to an 02 AFDC applicant with the potential to participate in the diversion project, a choice between 03 (1) having the AFDC application processed under AS 47.25.310 - 47.25.429; 04 or 05 (2) having the AFDC application denied and applying for diversion project 06 benefits under this section. 07 (c) The amount of the diversion payment must be sufficient to meet the family's 08 immediate needs as determined by the department and the participant. A diversion payment 09 may not exceed 10 (1) $1,000 for a family that includes one AFDC-eligible individual; 11 (2) $1,500 for a family that includes two AFDC-eligible individuals; 12 (3) $2,000 for a family that includes three AFDC-eligible individuals; 13 (4) $2,500 for a family that includes four or more AFDC-eligible individuals. 14 (d) As a condition of a family receiving a diversion payment under this section, the 15 participant must sign a binding contract between the participant and the department that 16 (1) specifies the amount of the diversion payment and the needs it is intended 17 to cover; 18 (2) provides that, during the three-month period beginning with the month in 19 which the diversion payment was received, child support collected on behalf of a child whose 20 needs were considered in determining the diversion payment shall be paid to the family; and 21 (3) provides that if the family reapplies for AFDC assistance under 22 AS 47.25.310 - 47.25.429 during the three months beginning with the month in which the 23 family received a diversion payment the diversion payment shall be treated as unearned 24 income, prorated over the three-month period, and deducted from any AFDC benefit the 25 family may be eligible for under the new application. 26 (e) A family that receives a diversion payment may not receive another diversion 27 payment before the 12th month following the month in which it last received a diversion 28 payment. 29 (f) To the extent that a provision of this section is inconsistent with AS 25.27.120 or 30 25.27.130, or with a provision of AS 47.25.310 - 47.25.429, the provision of this section 31 governs.

01 * Sec. 14. COOPERATION. State agencies shall cooperate with the department to the 02 extent necessary to implement secs. 8 - 15 of this Act. 03 * Sec. 15. DEFINITIONS. In secs. 8 - 15 of this Act, 04 (1) "AFDC" means the program of aid to families with dependent children 05 under AS 47.25.310 - 47.25.420; 06 (2) "department" means the Department of Health and Social Services. 07 * Sec. 16. IMMUNITY FROM LIABILITY. (a) The Department of Health and Social 08 Services, and its employees, agents, and grantees, are not liable for civil damages as a result 09 of an act or omission in the implementation, operation, or administration of an authorized 10 project under secs. 8 - 15 of this Act. 11 (b) The provisions of (a) of this section do not preclude liability for civil damages as 12 a result of recklessness or intentional misconduct. 13 (c) The provisions of (b) of this section do not constitute a waiver or limitation of 14 sovereign or other immunity. 15 * Sec. 17. AFDC PAYMENT LEVELS. Notwithstanding AS 47.25.320(a)(1) - (3), the 16 maximum amounts of assistance under AS 47.25.320(a) may not exceed the following, subject 17 to adjustments under other laws: 18 (1) dependent child living with nonneedy relative: $451 a month, plus $100 19 a month for each additional child; 20 (2) dependent child living with parent: 21 (A) for a parent and one dependent child, a maximum of $806 a month; 22 (B) for each additional child, or for a second parent, $100 a month per 23 individual; 24 (3) pregnant woman who is otherwise eligible for assistance under 25 AS 47.25.320 or a single-person household that does not consist of a dependent child: $505 26 a month. 27 * Sec. 18. REGULATIONS. (a) The Department of Health and Social Services shall 28 adopt regulations necessary to implement secs. 8 - 17 of this Act. The regulations adopted 29 by the department may include 30 (1) eligibility criteria for the projects described in secs. 9 - 13 of this Act that 31 differ from eligibility requirements in AS 47.25.310 - AS 47.25.429 and the regulations

01 adopted under those statutes; 02 (2) a maximum number of participants to be included in each project, if 03 necessary; 04 (3) exemptions from requiring participation in the projects because of 05 exceptional circumstances; and 06 (4) provisions for financial or non-financial sanctions for applicants who fail 07 to cooperate with project requirements or a provision of a plan. 08 (b) The Department of Revenue, child support enforcement agency, may adopt 09 regulations necessary to implement sec. 13 of this Act. 10 * Sec. 19. TRANSITION. The Department of Health and Social Services and the 11 Department of Revenue, child support enforcement agency, may proceed to adopt regulations 12 necessary to implement this Act. The regulations to implement a section of this Act take 13 effect under AS 44.62 (Administrative Procedure Act), but not before the effective date of the 14 relevant section of this Act. 15 * Sec. 20. Sections 3 - 5, 8, and 14 - 19 of this Act take effect immediately under 16 AS 01.10.070(c). 17 * Sec. 21. (a) Sections 9 - 13 of this Act take effect on the effective date of the federal 18 government's approval of the relevant waiver application made under sec. 8 of this Act. 19 (b) If the Department of Health and Social Services determines that federal statutes 20 do not require waivers for one or more of the projects outlined in secs. 9 - 13 of this Act, the 21 effective date of the relevant section is January 1, 1996, or the effective date of the federal 22 law, whichever is later. 23 (c) The commissioner of health and social services shall notify the revisor of statutes 24 and the lieutenant governor of the effective date of each of secs. 9 - 13 of this Act and of 25 whether the effective date was determined by a waiver approval or a determination that a 26 waiver is not necessary. 27 * Sec. 22. Section 2 of this Act takes effect January 1, 1996. 28 * Sec. 23. Sections 8 - 21 of this Act are repealed July 1, 2001.