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CSHB 78(FIN) AM Detail
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CSHB 78(FIN) AM: "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; 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) am 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; 06 proposing special demonstration projects within the program of aid to families 07 with dependent children and directing the Department of Health and Social 08 Services to seek waivers from the federal government to implement the projects; 09 amending Alaska Rule of Civil Procedure 90.3; and providing for an effective 10 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; a 03 minor parent's custody of the child shall be imputed to the parents of the minor parent, 04 regardless of where the minor parent lives, except that 05 (A) if the minor parent and child live with a parent of the 06 noncustodial minor parent, the minor parent's custody of the child shall be 07 imputed to the parent of the noncustodial minor parent; and 08 (B) a minor parent's custody of a child may not be imputed to 09 the parents of the minor parent if the minor parent and child do not live with 10 a parent of the minor parent because 11 (i) neither parent will allow the minor and child to live 12 in the residence of the minor's parent; or 13 (ii) the physical or emotional health or safety of the 14 minor parent or the minor's child would be jeopardized if the minor and 15 the minor's child lived in the same residence with the minor's parent; 16 and 17 (2) incomes of the child's grandparents and parents. 18 (f) To the extent that (e) of this section applies, 19 (1) the child's grandparents are considered to have a duty to support the 20 child and are subject to laws, regulations, and court rules relating to support of the 21 child; and 22 (2) a grandparent who is determined under applicable agency 23 regulations and court rules to be the obligor for purposes of paying child support on 24 behalf of a grandchild is subject to all laws, regulations, and court rules applicable to 25 child support obligors. 26 (g) An order of support against a child's grandparent under (e) of this section 27 and a grandparent's duty to support a child under (f) of this section is terminated, 28 without the need for obtaining a modification of a child support order, when one of 29 the child's parents reaches the age of majority or has the disabilities of minority 30 removed under AS 09.55.590, whichever occurs earlier. However, to the extent that 31 a grandparent may have accrued arrearages, the grandparent remains an obligor subject

01 to this chapter. 02 * Sec. 2. AS 25.27 is amended by adding new sections to read: 03 Sec. 25.27.244. ADVERSE ACTION AGAINST DELINQUENT OBLIGOR'S 04 OCCUPATIONAL LICENSE. (a) The agency shall compile and maintain a list of 05 obligors who are not in substantial compliance with a support order or payment 06 schedule negotiated under (g)(1) of this section. The list must include the names, 07 social security numbers, dates of birth, and last known addresses of the obligors. The 08 list shall be updated by the agency on a monthly basis. 09 (b) The agency shall, on a monthly basis, provide a copy of the list to each 10 licensing entity through a computer-readable magnetic medium. A licensing entity 11 subject to this section shall implement procedures to accept and process the list. 12 Notwithstanding any other law to the contrary, a licensing entity may not issue or 13 renew a license for a person on the list except as provided in this section. 14 (c) Promptly after receiving an application from an applicant and before 15 issuing or renewing a license, a licensing entity shall determine whether the applicant 16 is on the most recent list provided by the agency. If the applicant is on the list, the 17 licensing entity shall immediately serve notice under (e) of this section of the licensing 18 entity's intent to withhold issuance or renewal of the license. The notice shall be 19 considered given when delivered personally to the obligor or deposited in the U.S. mail 20 addressed to the applicant's last known mailing address on file with the licensing 21 entity. 22 (d) A licensing entity shall issue a temporary license valid for a period of 150 23 days to an applicant whose name is on the list if the applicant is otherwise eligible for 24 a license. The temporary license may not be extended. Only one temporary license 25 may be issued during a regular license term and its validity shall coincide with the first 26 150 days of that license term. A license for the full or remainder of the license term 27 may be issued or renewed only upon compliance with this section. If a license or 28 application is denied under this section, funds paid by the applicant or licensee shall 29 be refunded by the licensing entity after retention of the temporary license fee, if any. 30 (e) Notices for use under (c) of this section shall be developed by each 31 licensing entity under guidelines provided by the agency and are subject to approval

01 by the agency. The notice must include the address and telephone number of the 02 agency and shall emphasize the necessity of obtaining a release from the agency as a 03 condition for the issuance or renewal of a license. The notice must inform an 04 applicant whose license is governed by (d) of this section that the licensing entity shall 05 issue a temporary license for 150 calendar days under (d) of this section if the 06 applicant is otherwise eligible and that, upon expiration of that time period, the license 07 will be denied unless the licensing entity has received a release from the agency. The 08 agency shall also develop a form that the applicant may use to request a review by the 09 agency. A copy of this form shall be included with each notice sent under (c) of this 10 section. 11 (f) The agency shall establish review procedures consistent with this section 12 to allow an applicant to have the underlying arrearage and relevant defenses 13 investigated, to provide an applicant information on the process of obtaining a 14 modification of a support order, or to provide an applicant assistance in the 15 establishment of a payment schedule on arrearages if the circumstances warrant. 16 (g) If the applicant wishes to challenge being included on the list, the applicant 17 shall submit to the agency a written request for review within 30 days after receiving 18 the notice under (c) of this section by using the form developed under (e) of this 19 section. Within 30 days after receiving a written request for review, the agency shall 20 inform the applicant in writing of the agency's findings. The agency shall immediately 21 send a release to the appropriate licensing entity and the applicant if any of the 22 following conditions is met: 23 (1) the applicant is found to be in substantial compliance with each 24 support order applicable to the applicant or has negotiated an agreement with the 25 agency for a payment schedule on arrearages and is in substantial compliance with the 26 negotiated agreement; if the applicant fails to be in substantial compliance with an 27 agreement negotiated under this paragraph, the agency shall send to the appropriate 28 licensing entity a revocation of any release previously sent to the entity for that 29 applicant; 30 (2) the applicant has submitted a timely request for review to the 31 agency, but the agency will be unable to complete the review and send notice of

01 findings to the applicant in sufficient time for the applicant to file a timely request for 02 judicial relief within the 150-day period during which the applicant's temporary license 03 is valid under (d) of this section; this paragraph applies only if the delay in completing 04 the review process is not the result of the applicant's failure to act in a reasonable, 05 timely, and diligent manner upon receiving notice from the licensing entity that the 06 applicant's name is on the list; 07 (3) the applicant has, within 30 days after receiving the agency's 08 findings following a request for review under (2) of this subsection, filed and served 09 a request for judicial relief under this section, but a resolution of that relief will not 10 be made within the 150-day period of the temporary license under (d) of this section; 11 this paragraph applies only if the delay in completing the judicial relief process is not 12 the result of the applicant's failure to act in a reasonable, timely, and diligent manner 13 upon receiving the agency's notice of findings; or 14 (4) the applicant has obtained a judicial finding of substantial 15 compliance. 16 (h) An applicant is required to act with diligence in responding to notices from 17 the licensing entity and the agency with the recognition that the temporary license 18 granted under (d) of this section will lapse after 150 days and that the agency and, 19 where appropriate, the court must have time to act within that 150-day period. An 20 applicant's delay in acting, without good cause, that directly results in the inability of 21 the agency to complete a review of the applicant's request or the court to hear the 22 request for judicial relief within the required period does not constitute the diligence 23 required under this section that would justify the issuance of a release. 24 (i) Except as otherwise provided in this section, the agency may not issue a 25 release if the applicant is not in substantial compliance with the order for support or 26 is not in substantial compliance with an agreement negotiated under (g)(1) of this 27 section. The agency shall notify the applicant in writing that the applicant may request 28 any or all of the following: (1) judicial relief from the agency's decision not to issue 29 a release or the agency's decision to revoke a release under (g)(1) of this section; (2) 30 a judicial determination of substantial compliance; (3) a modification of the support 31 order. The notice must also contain the name and address of the court in which the

01 applicant may file the request for relief and inform the applicant that the applicant's 02 name shall remain on the list if the applicant does not request judicial relief within 30 03 days after receiving the notice. The applicant shall comply with all statutes and rules 04 of court implementing this section. This section does not limit an applicant's authority 05 under other law to request an order to show cause or notice of motion to modify a 06 support order or to fix a payment schedule on arrearages accruing under a support 07 order or to obtain a court finding of substantial compliance with a support order. 08 (j) A request for judicial relief from the agency's decision must state the 09 grounds on which relief is requested and the judicial action shall be limited to those 10 stated grounds. Judicial relief under this subsection is not an appeal, and shall be 11 governed by court rules adopted to implement this section. Unless otherwise provided 12 by court rule, the court shall hold an evidentiary hearing within 20 calendar days of 13 the filing of service on the opposing party. The court's decision shall be limited to a 14 determination of each of the following issues: 15 (1) whether there is a support order or a payment schedule on 16 arrearages; 17 (2) whether the petitioner is the obligor covered by the support order; 18 and 19 (3) whether the obligor is in substantial compliance with the support 20 order or payment schedule. 21 (k) If the court finds that the obligor is in substantial compliance with the 22 support order or payment schedule, the agency shall immediately send a release under 23 (g) of this section to the appropriate licensing entity and the applicant. 24 (l) When the obligor is in substantial compliance with a support order or 25 payment schedule, the agency shall mail to the applicant and the appropriate licensing 26 entity a release stating that the applicant is in substantial compliance. The receipt of 27 a release shall serve to notify the applicant and the licensing entity that, for the 28 purposes of this section, the applicant is in substantial compliance with the support 29 order or payment schedule unless the agency, under (a) of this section, certifies 30 subsequent to the issuance of a release that the applicant is once again not in 31 substantial compliance with a support order or payment schedule.

01 (m) The agency may enter into interagency agreements with the state agencies 02 that have responsibility for the administration of licensing entities as necessary to 03 implement this section to the extent that it is cost effective to implement the 04 interagency agreements. The agreements shall provide for the receipt by the other 05 state agencies and licensing entities of federal funds to cover that portion of costs 06 allowable in federal law and regulation and incurred by the state agencies and licensing 07 entities in implementing this section. 08 (n) Notwithstanding any other provision of law, the licensing entities subject 09 to this section shall assess a fee for issuance of a temporary license under this section. 10 The licensing entity shall set the amount of the fee so that the fees collected under this 11 section cover the costs of implementing and administering this section. 12 (o) The process described in (g) of this section is the sole administrative 13 remedy for contesting the issuance to the applicant of a temporary license or the denial 14 of a license under this section. The procedures specified in AS 44.62.330 - 44.62.630 15 (Administrative Procedure Act) do not apply to the denial or failure to issue or renew 16 a license under this section. 17 (p) The agency and licensing entities, as appropriate, shall adopt regulations 18 necessary to implement this section. 19 (q) In this section, 20 (1) "applicant" means a person applying for issuance or renewal of a 21 license; 22 (2) "license" 23 (A) means, except as provided in (B) of this paragraph, a 24 license, certificate, permit, registration, or other authorization that, at the time 25 of issuance, will be valid for more than 150 days that may be acquired from 26 a state agency to perform an occupation, including the following: 27 (i) license relating to boxing or wrestling under 28 AS 05.10; 29 (ii) authorization to perform an occupation regulated 30 under AS 08; 31 (iii) teacher certificate under AS 14.20;

01 (iv) authorization under AS 18.08 to perform emergency 02 medical services; 03 (v) asbestos worker certification under AS 18.31; 04 (vi) boiler operator's license under AS 18.60.395; 05 (vii) certificate of fitness under AS 18.62; 06 (viii) hazardous painting certification under AS 18.63; 07 (ix) security guard license under AS 18.65.400 - 08 18.65.490; 09 (x) license relating to insurance under AS 21.27; 10 (xi) employment agency permit under AS 23.15.330 - 11 23.15.520; 12 (xii) registration as a broker-dealer, agent, or investment 13 adviser under AS 45.55.030; 14 (xiii) certification as a pesticide applicator under 15 AS 46.03.320; 16 (xiv) certification as a storage tank worker or contractor 17 under AS 46.03.375; and 18 (xv) certification as a water and wastewater works 19 operator under AS 46.30; 20 (B) does not include 21 (i) a vessel license issued under AS 16.05.490 or 22 16.05.530; 23 (ii) a commercial fishing license under AS 16.05.480, 24 including a crewmember fishing license; 25 (iii) an entry permit or interim-use permit issued under 26 AS 16.43; 27 (iv) a license issued under AS 47.35; 28 (v) a business license issued under AS 43.70; or 29 (vi) a driver's license issued under AS 28.15; 30 (3) "licensee" means a person holding a license or applying to renew 31 a license;

01 (4) "licensing entity" means the state agency that issues or renews a 02 license; in the case of a license issued or renewed by the Department of Commerce 03 and Economic Development after an applicant's qualifications are determined by 04 another agency, "licensing entity" means the department; 05 (5) "list" means the list of obligors compiled and maintained under (a) 06 of this section; 07 (6) "substantial compliance with a support order or payment schedule" 08 means that, with respect to a support order or a negotiated payment schedule under (g) 09 of this section, whichever is applicable, the obligor has no more than $2,500 past due 10 and has cumulatively paid an amount equal to or greater than the amount due for eight 11 months during the past 12 months; with respect to a support order or payment schedule 12 that has been in effect for less than one year, "substantial compliance" means that the 13 obligor has no more than $2,500 past due and has cumulatively paid an amount equal 14 to or greater than 67 percent of the amount due during the period the support order or 15 payment schedule has been in effect. 16 Sec. 25.27.246. ADVERSE ACTION AGAINST DELINQUENT OBLIGOR'S 17 DRIVER'S LICENSE. (a) The agency shall compile and maintain a list of obligors 18 who have a driver's license and are not in substantial compliance with a support order 19 or payment schedule negotiated under (f)(1) of this section. The list must include the 20 names, social security numbers, dates of birth, and last known addresses of the 21 obligors. The list shall be updated by the agency on a monthly basis. 22 (b) The agency shall serve notice under (d) of this section to each person on 23 the list that the person's driver's license will be suspended in 150 days, and will not 24 be reissued or renewed the next time it is applied for if the person's name is on the list 25 at the time of the subsequent application, unless the licensee receives a release from 26 the agency. The notice shall be considered given when delivered personally to the 27 obligor or deposited in the U.S. mail addressed to the obligor's last known mailing 28 address on file with the agency. 29 (c) If the licensee fails to obtain a release during the 150-day period following 30 notice under (b) and (d) of this section, the agency shall notify the department that the 31 licensee's driver's license should be suspended and further renewals or applications

01 should be denied until the agency sends the department a release for the licensee. 02 Upon receiving the agency's notice under this subsection, the department shall suspend 03 the licensee's driver's license and may not issue or renew a driver's license for the 04 licensee until the department receives a release to do so from the agency. If a license 05 or application is suspended or denied under this section, funds paid by the applicant 06 or licensee may not be refunded by the department. 07 (d) The notice under (b) of this section must include the address and telephone 08 number of the agency and shall emphasize the necessity of obtaining a release from 09 the agency as a condition for avoiding suspension or denial of the person's driver's 10 license. The notice must also inform the licensee that, if a license or application is 11 suspended or denied under this section, funds paid by the licensee will not be refunded 12 by the department. The agency shall also develop a form that the licensee may use 13 to request a review by the agency. A copy of this form shall be included with each 14 notice sent under (b) of this section. 15 (e) The agency shall establish review procedures consistent with this section 16 to allow a licensee to have the underlying arrearage and relevant defenses investigated, 17 to provide a licensee with information on the process of obtaining a modification of 18 a support order, or to provide a licensee with assistance in the establishment of a 19 payment schedule on arrearages if the circumstances warrant. 20 (f) If a licensee wishes to challenge being included on the list, the licensee 21 shall submit to the agency a written request for review within 30 days after the notice 22 under (b) of this section was personally delivered or postmarked by using the form 23 developed under (d) of this section. Within 30 days after receiving a written request 24 for review, the agency shall inform the licensee in writing of the agency's findings. 25 The agency shall immediately send a release to the department and the licensee if any 26 of the following conditions is met: 27 (1) the licensee is found to be in substantial compliance with each 28 support order applicable to the licensee or has negotiated an agreement with the agency 29 for a payment schedule on arrearages and is in substantial compliance with the 30 negotiated agreement; if the licensee fails to be in substantial compliance with an 31 agreement negotiated under this paragraph, the agency shall send to the department a

01 revocation of any release previously sent to the entity for that licensee; 02 (2) the licensee has submitted a timely request for review to the 03 agency, but the agency will be unable to complete the review and send notice of 04 findings to the licensee in sufficient time for the licensee to file a timely request for 05 judicial relief within the 150-day period before the licensee's license will be suspended 06 under (c) of this section; this paragraph applies only if the delay in completing the 07 review process is not the result of the licensee's failure to act in a reasonable, timely, 08 and diligent manner upon receiving notice from the agency that the licensee's driver's 09 license will be suspended in 150 days; 10 (3) the licensee has, within 30 days after receiving the agency's findings 11 following a request for review under (2) of this subsection, filed and served a request 12 for judicial relief under this section, but a resolution of that relief will not be made 13 within the 150-day period before license suspension under (c) of this section; this 14 paragraph applies only if the delay in completing the judicial relief process is not the 15 result of the licensee's failure to act in a reasonable, timely, and diligent manner upon 16 receiving the agency's notice of findings; or 17 (4) the licensee has obtained a judicial finding of substantial 18 compliance. 19 (g) A licensee is required to act with diligence in responding to notices from 20 the agency with the recognition that the person's driver's license will be suspended 21 after 150 days or that a subsequent license will not be issued and that the agency and, 22 where appropriate, the court must have time to act within that 150-day period or before 23 the subsequent license is needed, as applicable. A licensee's delay in acting, without 24 good cause, that directly results in the inability of the agency to complete a review of 25 the licensee's request or the court to hear the request for judicial relief within the 26 required period does not constitute the diligence required under this section that would 27 justify the issuance of a release. 28 (h) Except as otherwise provided in this section, the agency may not issue a 29 release if the applicant is not in substantial compliance with the order for support or 30 is not in substantial compliance with an agreement negotiated under (f)(1) of this 31 section. The agency shall notify the licensee in writing that the licensee may request

01 any or all of the following: (1) judicial relief from the agency's decision not to issue 02 a release or the agency's decision to revoke a release under (f)(1) of this section; (2) 03 a judicial determination of substantial compliance; (3) a modification of the support 04 order. The notice must also contain the name and address of the court in which the 05 licensee may file the request for relief and inform the licensee that the licensee's name 06 shall remain on the list if the licensee does not request judicial relief within 30 days 07 after receiving the notice. The licensee shall comply with all statutes and rules of 08 court implementing this section. This section does not limit a licensee's authority 09 under other law to request an order to show cause or notice of motion to modify a 10 support order or to fix a payment schedule on arrearages accruing under a support 11 order or to obtain a court finding of substantial compliance with a support order. 12 (i) A request for judicial relief from the agency's decision must state the 13 grounds on which relief is requested and the judicial action shall be limited to those 14 stated grounds. Judicial relief under this subsection is not an appeal, and shall be 15 governed by court rules adopted to implement this section. Unless otherwise provided 16 by court rule, the court shall hold an evidentiary hearing within 20 calendar days of 17 the filing of service on the opposing party. The court's decision shall be limited to a 18 determination of each of the following issues: 19 (1) whether there is a support order or a payment schedule on 20 arrearages; 21 (2) whether the petitioner is the obligor covered by the support order; 22 and 23 (3) whether the obligor is in substantial compliance with the support 24 order or payment schedule. 25 (j) If the court finds that the obligor is in substantial compliance with the 26 support order or payment schedule, the agency shall immediately send a release under 27 (f) of this section to the department and the licensee. 28 (k) When the obligor is in substantial compliance with a support order or 29 payment schedule, the agency shall mail to the applicant and the department a release 30 stating that the licensee is in substantial compliance. The receipt of a release shall 31 serve to notify the licensee and the department that, for the purposes of this section,

01 the applicant is in substantial compliance with the support order or payment schedule 02 unless the agency, under (a) of this section, certifies subsequent to the issuance of a 03 release that the licensee is once again not in substantial compliance with a support 04 order or payment schedule. 05 (l) The process described in (f) of this section is the sole administrative 06 remedy for contesting the suspension or the denial of a driver's license under this 07 section. The procedures specified in AS 28 or AS 44.62.330 - 44.62.630 08 (Administrative Procedure Act) do not apply to the suspension or failure to issue or 09 renew a license under this section. 10 (m) The agency and department, as appropriate, shall adopt regulations 11 necessary to implement this section. 12 (n) In this section, 13 (1) "department" means the Department of Public Safety; 14 (2) "driver's license" or "license" means a driver's license, as defined 15 in AS 28.40.100; 16 (3) "licensee" means a person holding or requesting a driver's license; 17 (4) "list" means the list of obligors compiled and maintained under (a) 18 of this section; 19 (5) "substantial compliance with a support order or payment schedule" 20 means that, with respect to a support order or a negotiated payment schedule under (f) 21 of this section, whichever is applicable, the obligor has no more than $2,500 past due 22 and has cumulatively paid an amount equal to or greater than the amount due for eight 23 months during the past 12 months; with respect to a support order or payment schedule 24 that has been in effect for less than one year, "substantial compliance" means that the 25 obligor has no more than $2,500 past due and has cumulatively paid an amount equal 26 to or greater than 67 percent of the amount due during the period the support order or 27 payment schedule has been in effect. 28 * Sec. 3. AS 47.25.360 is amended to read: 29 Sec. 47.25.360. GRANTING OF ASSISTANCE. Upon the completion of the 30 investigation, the department shall decide whether the child is eligible for assistance 31 under AS 47.25.310 - 47.25.420, the amount of assistance, and the date on which it

01 starts. The department shall notify the person having custody of the child of its 02 decision. Except as provided in AS 47.25.362(b), the [THE] assistance shall be paid 03 monthly to the person having custody of the child upon order of the department. 04 * Sec. 4. AS 47.25 is amended by adding a new section to read: 05 Sec. 47.25.362. ASSISTANCE TO MINORS WITH CHILDREN. (a) Except 06 as provided in (c) of this section, the department shall require, as a condition of 07 eligibility for assistance, that a minor parent must reside in a 08 (1) place of residence maintained by the minor's parent, legal guardian, 09 or other adult relative of the minor as the parent's, guardian's, or other relative's own 10 home; or 11 (2) foster home, maternity home, or other adult-supervised supportive 12 living arrangement. 13 (b) Notwithstanding AS 47.25.360, the department shall, where possible, pay 14 assistance on behalf of a minor parent who is subject to the requirements of (a) of this 15 section to the minor's parent, legal guardian, or other adult relative, or, as applicable, 16 to the head of the adult-supervised supportive living arrangement where the minor 17 parent resides. 18 (c) The provisions of (a) and (b) of this section do not apply if 19 (1) the minor parent does not have a parent or legal guardian who is 20 living and whose whereabouts is known; 21 (2) a living parent or legal guardian of the minor parent will not allow 22 the minor to live in the home of the parent or guardian; 23 (3) the department determines that the physical or emotional health or 24 safety of the minor parent or the minor's child would be jeopardized if the minor and 25 the minor's child lived in the same residence with the minor's parent or guardian; 26 (4) the minor parent lived apart from the minor's parent or legal 27 guardian for either one year before the birth of the dependent child or one year before 28 the minor parent submitted the application for assistance; or 29 (5) the department otherwise determines under regulations that are 30 consistent with corresponding federal regulations that there is good cause for waiving 31 the requirements of (a) of this section in the case of a particular minor parent.

01 (d) When determining eligibility for, and the amount of, assistance in the case 02 of a minor parent who is required to live in a household or living arrangement with 03 an adult under (a) of this section, the department shall, to the extent allowed under 04 federal law or under a waiver of federal law, disregard the income and resources of 05 the adults in the household or living arrangement if the total income of the adults is 06 less than 133 percent of the federal poverty line for this state, as defined by the federal 07 office of management and budget and revised annually under 42 U.S.C. 9902(2). If 08 the department determines that a waiver of federal law is necessary before this 09 subsection may be implemented, the department shall promptly seek a waiver. 10 (e) In this section, "minor parent" means a person who is under the age of 18, 11 who has never married, and is either 12 (1) the natural parent of a dependent child living in the same 13 household; or 14 (2) eligible for assistance as a pregnant woman. 15 * Sec. 5. AS 47.25.310(c) is repealed. 16 * Sec. 6. COURT RULE CHANGE. (a) AS 25.27.060 (e) - (g), added by sec. 1 of this 17 Act, have the effect of amending Alaska Rule of Civil Procedure 90.3 by requiring 18 consideration of the income of the grandparents of a child when determining a child support 19 obligation under certain circumstances and by providing that a child's grandparents are 20 obligated to support the child under certain circumstances. 21 (b) Under art. IV, sec. 15, Constitution of the State of Alaska, AS 25.27.060(e) - (g), 22 added by sec. 1 of this Act, and this section may become law with the affirmative vote of a 23 majority of the membership of each house because the court rule being amended is not a rule 24 governing practice or procedure. 25 * Sec. 7. REPORT. (a) In furtherance of the public policy of increasing child support 26 enforcement and collections, on or before January 1, 1998, the child support enforcement 27 agency shall make a report to the legislature and the governor based on data collected by the 28 licensing entities and the agency in a format prescribed by the agency. The report must 29 contain 30 (1) the number of delinquent obligors on the lists maintained by the agency 31 under AS 25.27.244 - 25.27.246, enacted by sec. 2 of this Act;

01 (2) the number of delinquent obligors who also were applicants or licensees 02 subject to AS 25.27.244 - 25.27.246, enacted by sec. 2 of this Act; 03 (3) the number of new licenses and renewals that were delayed or denied and 04 temporary licenses issued subject to AS 25.27.244 and the number of new licenses and 05 renewals granted following receipt by licensing entities of releases under AS 25.27.244 by 06 July 1, 1997; 07 (4) the number of licenses under AS 28.15 that were suspended under 08 AS 25.27.246 and the number of licenses under AS 28.15 that were reinstated following 09 receipt by the Department of Public Safety of releases under AS 25.27.246 by July 1, 1997; 10 and 11 (5) the costs incurred in the implementation and enforcement of AS 25.27.244 12 - 25.27.246, enacted by sec. 2 of this Act. 13 (b) A licensing entity receiving an inquiry from the agency under (a) of this section 14 shall cooperate with the agency. When queried as to the licensed status of an applicant who 15 has had a license denied or suspended under AS 25.27.244 or 25.27.246 or has been granted 16 a temporary license under AS 25.27.244, the licensing entity shall respond only that the 17 license was denied or suspended or that the temporary license was issued. 18 * Sec. 8. WAIVER APPLICATION. (a) The Department of Health and Social Services 19 shall, by February 15, 1996, seek appropriate waivers from the federal government to 20 implement the AFDC demonstration projects described in secs. 9 - 13 of this Act. To the 21 extent that the federal government approves the necessary waivers, the department shall 22 implement the projects. The purposes of the projects are to promote personal responsibility 23 and self-sufficiency. 24 (b) At a minimum, the department shall implement secs. 10 - 13 of this Act as four 25 separate projects in four different areas of the state, with at least one project in a municipality 26 with a population over 25,000, one in a municipality with a population between 5,000 and 27 25,000, and one in a municipality or community with a population under 5,000. If the 28 department determines that more than one project can be efficiently and usefully operated in 29 the same area at the same time the department may operate more than one project in the same 30 area as a fifth project, subject to federal approval of the appropriate waivers. 31 (c) Notwithstanding (a) of this section, if changes in federal statutes or regulations

01 occur after the effective date of this section and would have a major effect on the design, 02 implementation, or operation of the project, the department shall 03 (1) apply for and implement only the waivers that relate to the parts of the 04 project that are not substantially affected by the changes in federal statutes or regulations; if 05 the department determines that the parts of the project that are not substantially affected by 06 the federal changes do not comprise a fiscally responsible project, the department is not 07 required to apply for or implement waivers under this Act and may discontinue operation of 08 the project under waivers that were implemented before the federal changes occurred; 09 (2) report to the legislature its recommendations for changes in its statutory 10 authority that may be needed in order to implement a fiscally responsible project in light of 11 conflicting or permissive changes in federal statutes or regulations. 12 * Sec. 9. EARNED INCOME DISREGARD; WAIVER OF "100-HOUR" RULE; AUTO 13 ALLOWANCE. When determining the AFDC eligibility of a family that is participating in 14 a project under secs. 10 - 12 of this Act and when determining the amount of assistance to 15 which the family is entitled, the department shall 16 (1) disregard, for 24 months, $200 plus one-third of the remainder of the 17 earned income of each person in the family unless federal regulations require that more earned 18 income of a person must be disregarded; for a family that applies for AFDC after this 19 paragraph has been implemented, this 24 months begins with the month for which the family 20 is first granted AFDC; for a family that is already receiving assistance when this paragraph 21 is implemented, this 24 months begins with the first month during which this paragraph is 22 implemented; 23 (2) waive the requirement that, for purposes of assistance for a dependent child 24 of unemployed parents, the principal wage-earning parent must be employed less than 100 25 hours a month; and 26 (3) allow the exclusion of $5,000 of the combined equity of motor vehicles 27 used by the family for basic family transportation, transportation of a disabled child in the 28 household, or transportation of a member of the family to or from employment, training, or 29 participation in an activity required under secs. 10 - 11 of this Act; if the combined equity of 30 vehicles described in this paragraph exceeds $5,000, the department shall apply the excess 31 equity amount toward the asset limit otherwise applicable to the family.

01 * Sec. 10. WORKFARE. (a) The department shall operate a workfare project. Each 02 member of a family in the workfare project area who is 18 years of age or older shall 03 participate for 21 hours a week in an uncompensated activity if assigned to the activity by the 04 department. The department shall assess the availability of activities that satisfy the purposes 05 of this subsection in the project area and attempt to develop additional activities where 06 necessary. When assessing the availability of activities that are suitable as uncompensated 07 activities under this section and in assigning persons to those activities, the department shall 08 consider activities recommended by governmental representatives of boroughs, cities, and 09 communities and others in the project area. The activities may include provision of child care 10 for other project participants, community work experience, work-related training programs, 11 high school completion, GED programs, or culturally relevant subsistence activities. The 12 department shall penalize the family for failure of a person to comply with this subsection by 13 disregarding that person as a member of the family for purposes of determining the amount 14 of AFDC assistance given to the family. 15 (b) If organizations exist in the project area that have had successful experience in 16 conducting employment placement services, community services, and job training programs, 17 the department shall offer on a competitive basis contracts to those organizations to administer 18 (a) of this section. A contract under this subsection must provide that the department shall 19 make the determinations required under (c) and (d) of this section and the contractor shall 20 perform the duties assigned to the department under (a) of this section with respect to 21 uncompensated activities, including assessment of their availability, development of additional 22 activities, consideration of activities recommended by governmental representatives, and 23 assignment of persons to specific activities after referral of those persons to the contractor by 24 the department. The department may, after consultation with the appropriate contractor under 25 this subsection, if any, 26 (1) provide AFDC benefits to participant families in amounts and forms the 27 department determines are appropriate to the circumstances of the family; 28 (2) use AFDC benefits to subsidize payments or provide services to 29 participants in community work projects or work training projects; an amount distributed as 30 a subsidy under this paragraph is not considered to be wages; and 31 (3) deny AFDC benefits to a family that fails to cooperate with services

01 offered and activities required under the pilot project; a family denied benefits under this 02 paragraph may appeal that determination to the department under AS 47.25.370 for review of 03 whether the denial was appropriate under department regulations governing administration of 04 the project. 05 (c) The requirement to participate in an uncompensated activity under (a) of this 06 section does not apply to a person who 07 (1) has paid employment of at least 15 hours a week; a person who has paid 08 employment of less than 15 hours a week shall participate in an uncompensated activity 09 assigned under (a) of this section for the number of hours that, when added to the hours of 10 paid employment, equals 21; 11 (2) is exempt from participating in an activity under AS 47.25.421 - 47.25.429 12 (JOBS program); 13 (3) is enrolled as a full-time student in good standing in a career education 14 program, college, or university, as defined in regulations adopted under AS 14.43; 15 (4) is the parent or other relative of a child under six years of age living in the 16 same household who personally provides care for the child; 17 (5) is determined, according to regulations of the department, to be physically 18 or mentally unable to perform any reasonable activity that may be assigned under this section; 19 or 20 (6) is a parent who is providing care for a child with a developmental disability 21 as defined by AS 47.80.900. 22 (d) Notwithstanding (a) of this section, the department may not require a person to 23 participate in an uncompensated activity under (a) of this section unless the department agrees 24 to pay for 25 (1) costs of child care determined by the department to be necessary for the 26 person's participation; and 27 (2) transportation expenses determined by the department to be necessary for 28 the person's participation in the activity. 29 (e) In this section, "project area" means the area chosen by the department in which 30 to operate the workfare project described in this section. 31 * Sec. 11. AFDC UNEMPLOYED PARENT PROJECT. (a) The Department of Health

01 and Social Services shall operate a transition-to-work project that is designed to assist two-parent families receiving 02 assistance under the Aid to Families with Dependent Children 03 (AFDC) program to achieve economic self-sufficiency within three years after the date of 04 entry into the project. To this end, the department shall develop, with each participating 05 family, an individual family plan for achieving self-support and shall enter into a contract with 06 that family that identifies 07 (1) the services that the department will provide to enable the family to achieve 08 self-support; 09 (2) the activities that the family will participate in to prepare for self-sufficiency; 10 (3) specific benchmarks to indicate the steps toward successful completion of 11 the family plan; 12 (4) an agreement that cash assistance benefits under the AFDC program will 13 be available to the family for no more than 36 months during the period from the effective 14 date of this section to June 30, 2001; 15 (5) an acknowledgment that medical assistance benefits under AS 47.07 may 16 be available as long as the family is otherwise eligible under the AFDC program; and 17 (6) an acknowledgement that failure to comply with the terms of a family plan 18 developed under this section or failure to meet a benchmark of the plan may result in a 19 finding of noncooperation and a modification or denial of AFDC benefits to the family. 20 (b) The services and referrals to be provided by the department and the activities to 21 be included in a family plan may include 22 (1) child care services; 23 (2) uncompensated community work experience; 24 (3) work-related training programs; 25 (4) high school completion or GED programs; 26 (5) provision of child care for other project participants; 27 (6) culturally relevant subsistence activities; 28 (7) placement in paid employment; and 29 (8) referral to other services and programs that may improve the family's 30 employability or self-sufficiency. 31 (c) The department shall deny AFDC benefits to a family that is assigned to

01 participate in the project under this section if the family fails to cooperate in the development 02 of a family plan or fails to sign a family contract as required by (a) of this section. A family 03 assigned to participate in the project under this section that is denied AFDC benefits under 04 this subsection shall be provided the opportunity for a fair hearing under AS 47.25.370 to 05 determine whether benefits were properly denied under the statutes and regulations governing 06 the project. 07 (d) To the extent that a provision of this section is inconsistent with a provision of 08 AS 47.25.310 - 47.25.429, the provision of this section governs. 09 * Sec. 12. SELF-EMPLOYMENT PROJECT. (a) The Department of Health and Social 10 Services shall operate a self-employment demonstration project for the purpose of allowing 11 individual recipients of Aid to Families with Dependent Children (AFDC) assistance under 12 AS 47.25.310 - AS 47.25.429 to reduce their need for public assistance by establishing and 13 operating a microenterprise. Under the self-employment demonstration project, a recipient 14 may accumulate certain resources needed to acquire business skills or to establish and operate 15 a microenterprise without becoming ineligible for AFDC assistance. 16 (b) An AFDC recipient who wishes to participate in the self-employment 17 demonstration project under this section shall request from the department a referral to a 18 nonprofit business development organization for an assessment of the recipient's capacity for 19 self-employment and the economic viability of the microenterprise contemplated by the 20 recipient. After review of the request, the department may provide the referral. 21 (c) An AFDC recipient who wishes to participate in the self-employment 22 demonstration project and has been referred for an assessment under (b) of this section shall 23 formulate a business plan for the microenterprise. The recipient shall submit the business plan 24 to the nonprofit business development organization for review and then submit the reviewed 25 business plan to the department for approval. 26 (d) For purposes of determining a recipient's eligibility for AFDC assistance, for the 27 first 36 months after the initial approval by the department of the recipient's business plan for 28 a microenterprise, the department shall 29 (1) disregard up to $10,000 in microenterprise assets set aside for the 30 development or operation of the microenterprise in accordance with the approved plan; 31 (2) disregard up to $500 each month in nonbusiness income set aside for the

01 development or operation of the microenterprise; and 02 (3) determine the recipient's income based on the net business income received 03 from the recipient's microenterprise. 04 (e) At 12-month intervals, a recipient whose business plan for a microenterprise has 05 been approved shall submit to the department a review of the financial records of the 06 microenterprise, signed by an accountant or bookkeeper, and verified by the nonprofit business 07 development organization that conducted the recipient's assessment under (b) of this section. 08 The cost of record review shall be considered a business expense of the recipient's 09 microenterprise. 10 (f) To the extent that a provision of this section is inconsistent with a provision of 11 AS 47.25.310 - 47.25.429, the provision of this section governs. 12 (g) In this section, 13 (1) "business income" means all income derived from the use of 14 microenterprise assets in a microenterprise; 15 (2) "employees" means the operator of a microenterprise and any persons 16 employed in the operation of the business; 17 (3) "microenterprise" means a business enterprise that has fewer than five 18 employees; 19 (4) "microenterprise assets" means all of the following: 20 (A) business loans; 21 (B) capital equipment; 22 (C) inventory; and 23 (D) all other assets required for the operation of the microenterprise; 24 (5) "net business income" means all business income minus all of the 25 following: 26 (A) business loan payments; 27 (B) business taxes; 28 (C) expenditures for vehicles vital to the business operations; 29 (D) cash retained in the microenterprise; 30 (E) insurance expenditures; 31 (F) inventory raw material expense;

01 (G) transportation expenditures; 02 (H) office supplies; 03 (I) professional services, including accounting, legal, or other consulting 04 services; 05 (J) delivery charges and supplies; 06 (K) commissions, salaries, wages, and other employment benefits, 07 including dental and vision care; 08 (L) postage; 09 (M) rent; 10 (N) utilities; 11 (O) telephone expenses; 12 (P) advertising and other marketing and promotional costs; and 13 (Q) training and professional development expenses. 14 * Sec. 13. DIVERSION PROJECT. (a) The Department of Health and Social Services 15 shall operate a diversion project that is designed to increase family income through 16 employment and child support payments by offering lump-sum diversion payments in place 17 of ongoing financial assistance under the Aid to Families with Dependent Children (AFDC) 18 program. A diversion payment may be offered to an applicant for AFDC who is job-ready 19 and who needs short-term financial assistance to meet critical needs in order to secure 20 employment and support for the applicant's family. 21 (b) Diversion project benefits may be paid only to an applicant's family that appears, 22 based on the information provided to the department on an AFDC application, to be eligible 23 for AFDC benefits and to include a job-ready individual. The department may offer, to an 24 AFDC applicant with the potential to participate in the diversion project, a choice between 25 (1) having the AFDC application processed under AS 47.25.310 - 47.25.429; 26 or 27 (2) having the AFDC application denied and applying for diversion project 28 benefits under this section. 29 (c) The amount of the diversion payment must be sufficient to meet the family's 30 immediate needs as determined by the department and the participant. A diversion payment 31 may not exceed

01 (1) $1,000 for a family that includes one AFDC-eligible individual; 02 (2) $1,500 for a family that includes two AFDC-eligible individuals; 03 (3) $2,000 for a family that includes three AFDC-eligible individuals; 04 (4) $2,500 for a family that includes four or more AFDC-eligible individuals. 05 (d) As a condition of a family receiving a diversion payment under this section, the 06 participant must sign a binding contract between the participant and the department that 07 (1) specifies the amount of the diversion payment and the needs it is intended 08 to cover; 09 (2) provides that, during the three-month period beginning with the month in 10 which the diversion payment was received, child support collected on behalf of a child whose 11 needs were considered in determining the diversion payment shall be paid to the family; and 12 (3) provides that if the family reapplies for AFDC assistance under 13 AS 47.25.310 - 47.25.429 during the three months beginning with the month in which the 14 family received a diversion payment the diversion payment shall be treated as unearned 15 income, prorated over the three-month period, and deducted from any AFDC benefit the 16 family may be eligible for under the new application. 17 (e) A family that receives a diversion payment may not receive another diversion 18 payment before the 12th month following the month in which it last received a diversion 19 payment. 20 (f) To the extent that a provision of this section is inconsistent with AS 25.27.120 or 21 25.27.130, or with a provision of AS 47.25.310 - 47.25.429, the provision of this section 22 governs. 23 * Sec. 14. COOPERATION. State agencies shall cooperate with the department to the 24 extent necessary to implement secs. 8 - 15 of this Act. 25 * Sec. 15. DEFINITIONS. In secs. 8 - 15 of this Act, 26 (1) "AFDC" means the program of aid to families with dependent children 27 under AS 47.25.310 - 47.25.420; 28 (2) "department" means the Department of Health and Social Services. 29 * Sec. 16. IMMUNITY FROM LIABILITY. (a) The Department of Health and Social 30 Services, and its employees, agents, and grantees, are not liable for civil damages as a result 31 of an act or omission in the implementation, operation, or administration of an authorized

01 project under secs. 8 - 15 of this Act. 02 (b) The provisions of (a) of this section do not preclude liability for civil damages as 03 a result of recklessness or intentional misconduct. 04 (c) The provisions of (b) of this section do not constitute a waiver or limitation of 05 sovereign or other immunity. 06 * Sec. 17. REGULATIONS. (a) The Department of Health and Social Services shall 07 adopt regulations necessary to implement secs. 8 - 16 of this Act. The regulations adopted 08 by the department may include 09 (1) eligibility criteria for the projects described in secs. 9 - 13 of this Act that 10 differ from eligibility requirements in AS 47.25.310 - AS 47.25.429 and the regulations 11 adopted under those statutes; 12 (2) a maximum number of participants to be included in each project, if 13 necessary; 14 (3) exemptions from requiring participation in the projects because of 15 exceptional circumstances; and 16 (4) provisions for financial or non-financial sanctions for applicants who fail 17 to cooperate with project requirements or a provision of a plan. 18 (b) The Department of Revenue, child support enforcement agency, may adopt 19 regulations necessary to implement sec. 13 of this Act. 20 * Sec. 18. TRANSITION. The Department of Health and Social Services and the 21 Department of Revenue, child support enforcement agency, may proceed to adopt regulations 22 necessary to implement this Act. The regulations to implement a section of this Act take 23 effect under AS 44.62 (Administrative Procedure Act), but not before the effective date of the 24 relevant section of this Act. 25 * Sec. 19. Sections 3 - 5, 8, and 14 - 19 of this Act take effect immediately under 26 AS 01.10.070(c). 27 * Sec. 20. (a) Sections 9 - 13 of this Act take effect on the effective date of the federal 28 government's approval of the relevant waiver application made under sec. 8 of this Act. 29 (b) If the Department of Health and Social Services determines that federal statutes 30 do not require waivers for one or more of the projects outlined in secs. 9 - 13 of this Act, the 31 effective date of the relevant section is January 1, 1996, or the effective date of the federal

01 law, whichever is later. 02 (c) The commissioner of health and social services shall notify the revisor of statutes 03 and the lieutenant governor of the effective date of each of secs. 9 - 13 of this Act and of 04 whether the effective date was determined by a waiver approval or a determination that a 05 waiver is not necessary. 06 * Sec. 21. Section 2 of this Act takes effect January 1, 1996. 07 * Sec. 22. Sections 8 - 21 of this Act are repealed July 1, 2001.