No change.

(2) is placed in a foster family home (approved by (2) Expanded to allow Federal participation as to chilthe State) as a result of such determination; and

dren placed in a nonprofit private child care insti-
tution, subject to limitations prescribed by Secre-
tary to include within Federal participation only
cost items which are included in foster family
home care.

Provision is made for payments by the State
or local agency for foster care in a foster family
home or a child care institution either directly or
through a public or nonprofit private child-
placement or child-care agency.
Effective as to expenditures made after June 30, 1962.
(3) No change.

Authorizes Federal participation in payments to the
spouse of the parent (who is living with the parent)
but only if the child is a dependent child because of
the disability or unemployment of the parent. The
provision is not applicable to the spouses of other
specified relatives.

Effective as to expenditures after Sept. 30, 1962.

Requires that a State agency, in determining need, must
take into account any expenses that may be reasonably
attributable to the earning of income. Would allow
any States, subject to limitations prescribed by the
Secretary, to permit all or any portion of the earned

in the earning of income. Also under present ad-
ministrative practice States are allowed at their op-
tion to disregard certain amounts of income set aside
for education, employment training, etc., of a child
but no differentiation is allowed between types of in-
come-earned or unearned.

E. Methods of payments by States. Federal financial participation as to money payments
to needy persons or their legal guardians has been
authorized since 1935. Vendor payments, made
directly to the suppliers of medical services on behalf
of recipients have been authorized by the 1950 amend-
ments. Since 1958, payments have been authorized
to be made to another person who is judicially ap-
pointed for the purpose of receiving and managing
such assistance payments (whether or not he is such
individual's legal representative for other purposes).

Apart from payments pursuant to the above provisions nonmoney payments by States and localities have not been subject to Federal participation. These include voucher payments (furnishing recipient with vouchers which enable him to obtain particular goods or services) and relief in kind directly from State agency. Also, the law has been interpreted to exclude Federal participation as to certain "restricted payments." Such restricted payments may utilize one or more of the methods of payments noted above or may circumscribe the client's use of his assistance, by direct supervision of expenditures, requiring the client to make a report of his expenditures, or to account for them by furnishing receipts. The payment might be conditioned upon its being used, in whole or in part, for specific purposes.

or other income to be disregarded if set aside for future identifiable needs of a dependent child. Effective July 1, 1963.

Authorizes protective payments to be made, in a limited
number of cases (5 percent), to a person who is
interested in or concerned with the welfare of the
dependent child and relative, under a State plan which
provides for

(1) determination by the State agency that pay-
ments in this form are necessary because the relative
is so unable to manage funds that it would be contrary
to the child's welfare to make payments to such
relative;

(2) meeting 100 percent of the need of the eligible
persons under the plan;

(3) special efforts to improve the ability of the
relative to manage funds, and periodical review of the
situation to determine whether such payments to
another interested person are still necessary-and
with provision for judicial appointment of a guardian
or legal representative if the need for payments to
another interested person continues beyond a period
specified by the Secretary;

(4) opportunity for a fair hearing before the State
agency on the determination that payments to
another interested person on behalf of the child and
relative are necessary; and

(5) aid in the form of foster family care, as pro-
vided for in the Social Security Act.
Effective Oct. 1, 1962, and ending June 30, 1967. Prior
to Jan. 1, 1967, the Secretary shall submit a report
with recommendations on the provision to the Con-

Authorizes the State agency to take the following steps,
whenever it has reason to believe that payments to a
relative for the benefit of a child are not being or may
not be used in the best interests of the child:

(1) To provide the relative with counseling and
guidance concerning the use of payments and manage-
ment of other funds to assure their use in the best
interests of the child;

(2) To advise the relative that continued misuse of
payments will result in substitution of protective
payments (described above), or in seeking appoint-
ment of a guardian or legal representative, or in other
action being taken under State law to protect the
interests of the child.

Any action taken by the State agency pursuant to State
law, other than denial of payments for a child while
in the home of a relative, will not serve as a basis for
withholding Federal funds from a State under the aid
to dependent children program. The States could,
under State law, utilize various types of nonmoney
payments without loss of Federal funds. Effective
as to expenditures after Sept. 30, 1962.

Permits the relative to receive money payments or
medical care whether the child is receiving aid in the
form of money payments or in the form of vendor
payments for medical care. Effective July 1, 1962.
Changes name to "Aid and Services to Needy Families
With Children."

Requires that the State plan for aid to dependent
children must provide for the development and appli-
cation of a program for such welfare and related
services for each child who receives ADC as may be
necessary in the light of the particular home condi-
tions and other needs of the child; and must provide
for the coordination of this program with the child
welfare services plan developed in the State, with a
view toward providing welfare and related services
which will best promote the child's and his family's
welfare. Effective July 1, 1963.

In determining need in the old-age, blind, dependent No change.
children, and disabled program the State agency
must take into consideration any other income and
resources of the individual claiming assistance (ex-
cept that as to the aid to the blind program the
State agency may, until June 30, 1962, either dis-
regard the first $50 of earned income or the first $85
per month of earned income plus half of monthly
earnings over that amount. After June 30, 1962,
the States must disregard the first $85 per month of
earned income plus half of monthly earnings over
that amount).

Under current administrative policy, the States are encouraged but not required to take into account expenses incurred in earning income.

Federal grants to States (without a matching requirement) to assist in the administration of public assistance programs by increasing the number of trained public welfare personnel. Funds may be used for (1) grants to public or other nonprofit institutions of higher learning for training personnel employed or preparing for employment in public assistance programs, (2) special courses of study or seminars of short duration conducted for such personnel, and (3) establishing and maintaining, directly or through grants to such institutions, fellowships, or traineeships for such personnel. Allotments to States are based on population, need for personnel, and financial need.

Requires that a State agency, in determining need, must take into account any expenses that may be reasonably attributable to the earning of income. Effective July 1, 1963.

1. No change.