4. Social Services—Title XX of the Social Security Act, in effect as of October 1, 1975, provides for Federal reimbursement of 75% of State costs for social services with an overall budget ceiling of $2.5 billion. For social services to AFDC families, the Federal matching rate to Territories is 60%. Section 248 (b) of the Social Security Amendments of 1967. For social services to needy adults, the matching rate is 75%, as for States. In addition to funding social services under title IV-A, subject to their $1.1 million ceiling, Guam may receive up to $500,000 of any of the $2.5 billion available to the States, that the States themselves have not used. (P.L. 94-647.) Guam is also subject to a $90,000 limit in Federal funds it may receive for family planning programs.

5. Food Stamps-The food stamp program has been fully operative in Guam only since fall 1974. Food stamp allotments are determined in Guam, as in the States, by the countable income of participating households. In October 1976, approximately 13,000 persons received food stamps; their average bonus was $31 per month. Fiscal 1976 benefits amounted to $11,400.000. Approximately $4.9 million of that amount went in emergency issuances to persons affected by a typhoon in May.

III. COSTS AND CASELOADS OF EXTENDING SSI TO GUAM

In October 1976, the Social Security Administration prepared revised estimates of the costs and caseloads associated with extending SSI to Guamboth with and without a provision to reduce the benefit level. It is estimated that Guam's per capita income is 92.4% that of Mississippi, the State with the lowest per capita income. SSA estimates that the Federal SSI benefit level for the period July 1977 through June 1978 will be $176.90. Therefore, for this period the benefit level in Guam would be $163.00 (92.4% of the Federal benefit level). The following chart compares costs and caseloads under existing law with provisions to extend SSI to Guam with a reduction based on per capita income and with the full payment level available as in the other States. These estimates assume full participation from the date of enactment.

1 Assumes extension of SSI to Guam. If, instead, the old adult welfare programs were retained in Guam, but she were treated as a State for matching purposes, the formula would provide 83 pct Federal funding.

2 This $1.1 million ceiling also must cover social service funds other than those available from title 20.

Available only if the States fail to use their full allotments under title 20. Guam may also provide social services under title IV-A, subject to the $1.1 million ceiling.

Unlimited authorization.

1 We do not have available information regarding the maximum benefit currently available in Guam. However, in June 1976 the average OAA benefit was $70.09 per person, the average AB benefit was $83.13, and the average APTD benefit was $75.01.

1. AFDC and Medicaid-Guam would have received subtantially more Federal AFDC and Medicaid payments in fiscal 1975 than it did in that year if it had been treated as a State and exempted from the statutory ceiling. In fiscal 1975, Mississippi was reimbursed for approximately 80% of its expenditures for Medicaid, about 83% for AFDC. Guam, with a lower per capita income, received about $355,706 for Medicaid (under the $900,000 limit) as compared with the approximately $590,000 (83% of total computable expenditures of $711,411) that it would have received were it not for the 50% Federal sharing stipulation and the $900,000 ceiling. Guam's Federal allotment for AFDC in 1975 would have been about 1.4 million had it been reimbursed at an 83% rate as compared with the receipt of about $863,831-half of Guam's AFDC costs.

2. Aid to the Aged, Blind, and Disabled-Prior to January 1, 1974, when the Federal government assumed 100% of the costs of a minimum income guarantee to the aged, blind, and disabled under the SSI program, the States were reimbursed for about 5/6 of the costs of these programs while Guam was reimbursed at 50% matching rate. Thus, Guam's status was not changed by the enactment of P.L. 92-603. Territories still must pay 50% of the costs of cash aid to needy adults. In fiscal year 1975, Guam spent approximately $550,970 on aid to the aged, blind, and disabled and was reimbursed for half that amount.

3. Social Services-It is estimated that in fiscal year 1977 Guam will receive $500,000 in title XX funds, the full $500,000 allotment from excess funds as stipulated in section 2002(a) (D) of title XX of the Social Security Act. If Guam were to be treated as a State and to receive a Title XX allotment proportionate to her population, she would be eligible for $1 million in social service funds. To "earn" this sum she would need to spend $330,000 of her own.

PREPARED STATEMENT OF THE AMERICAN COUNCIL OF THE BLIND

SUMMARY

The American Council of the Blind favors enactment of H.R. 6124 and of the legislative recommendations concerning the Title XX social services ceiling and Puerto Rico, Guam, and the Virgin Islands (appearing on pages 39-41 of the Committee on Ways and Means on the fiscal year 1978 budget), with the following amendments:

1. Extending the Supplemental Security Income program to Puerto Rico, Guam and the Virgin Islands on the same basis as in the States, as provided by H.R. 1470 (by Corrada) and similar bills.

2. Adjusting the Federal matching rates for AFDC in Puerto Rico, Guam, and the Virgin Islands to figures which reflect their relative fiscal situations. 3. Providing for a permanent adjustment in the Title XX social services ceiling.

4. Striking the provisions in Section 1614(f) (2) which "deem" the income and resources of a minor to include the income and resources of a parent or step-parent whether or not available to the individual.

STATEMENT

1. The Committee's recommendation for extending the Supplemental Security Income program to Puerto Rico, Guam, and the Virgin Islands includes the proviso that the benefit rates would be adjusted so as to "bear the same ratio to the benefit rates in title XVI as the per capita income in each territory bears to that state with the lowest per capita income." This would continue discrimination against these citizens. If no distinction for SSI purposes is made between the residents of Mississippi and those of Alaska, which differ considerably in per capita income, why should such a distinction be made between the residents of Puerto Rico and Mississippi? We favor extension of SSI coverage to Puerto Rico, Guam, and the Virgin Islands on the same basis as in the States, in accordance with the provisions of H.R. 1470 and similar bills. We know no better way of stating our position than the words of President. Carter's message to the Governor of Puerto Rico which was quoted in Mr. Corrada's remarks in the House on February 24 of this year:

"The Constitution of the United States does not distinguish between citizens. We do not have in our country first and second class citizens."

2. The Committee has recommended elimination of the ceiling on Federal funding for the AFDC program in Puerto Rico, Guam, and the Virgin Islands, but it does not propose a change in the current matching rate for assistance payments. This also would perpetuate the current discrimination against these jurisdictions. This rate is the same as the rates for States such as Alaska, California, Hawaii, Massachusetts, and New York, which have high per capita incomes. We recommend that the matching ratios for these three jurisdictions be set at figures which reflect their relative fiscal situations.

3. While we favor extensions of the $200 million increase in the ceiling on the Title XX social services program on a temporary basis, we believe that a permanent method of adjusting this ceiling should be worked out as soon as possible. We recommend that a formula be devised which would vary the ceiling in proportion to changes in price and wage levels. Otherwise, social services under Title XX will decline steadily as a result of inflation.

4. We endorse the provision of H.R. 6124 which eliminates the attribution of family income to individuals who take training after reaching age 18. This proposed change, however, does not eliminate another defect in the present Section 1614(f) (2) which we urged the Congress to remedy two years ago. This defect is the "deeming" the income and resources of an individual under 18 to include any income and resources of "a parent of such individual (or the spouse of such a parent) who is living in the same household as such individual, whether or not available to such individual." This is a clear disincentive to marriage for the parent of a disabled child and completely disregards the plight of the disabled child to whom the income and resources of his parent(s) or step-parent are not actually available. We recommend further amending Section 1614 (f) (2) by striking the phrase "(or the spouse of such a parent)" and by substituting the word "if" for the phrase "whether or not."

PREPARED STATEMENT OF THE AMERICAN FEDERATION OF LABOR AND CONGRESS OF INDUSTRIAL ORGANIZATION BY ANDREW J. BIEMILLER, DIRECTOR, DEPARTMENT

OF LEGISLATION

We appreciate this opportunity to submit the views of the AFL-CIO on H.R. 4138, 4139 and 5093, bills dealing with the treatment of aliens under the SSI program; H.R. 6124, a bill dealing with administrative simplification and improvement of the Supplemental Security Income Program (SSI); and on legislative recommendations pertaining to public assistance contained in the Ways and Means Committee's March 15 Report to the Budget Committee for Fiscal Year 1978.

We will comment first on those items relating to the SSI program.

H.R. 4138, 4139, AND 5903-ALIENS AND THE SUPPLEMENTAL SECURITY INCOME PROGRAM (SSI)

These bills would severely restrict the eligibility of aged, blind and disabled aliens for SSI benefits. Eligibility for welfare should always be determined on the basis of need. Historically, this has been the approach taken in all means tested, public assistance programs. Generally, everyone has been eligible so long as the standards of need have been met.

Our immigration laws prohibit individuals who are unable to support themselves or likely to become public burdens from immigrating into the United States. Thus, the number of aliens who become eligible for SSI benefits is small and represents a minor cost to the program and the taxpayers.

After they have legally immigrated to the United States, it does not seem possible that our society would let aged. blind and disabled aliens starve or die because of a lack of funds or health care. Since public assistance programs such as SSI and Medicaid have been set up to deal with such problems of poor people, it makes administrative sense to use these programs rather than to establish separate programs to deal with identical problems of aliens or handle them on an ad hoc basis. If Congress feels some aliens have abused the SSI program, the problem is best dealt with by changing and/or improving the administration of our immigration laws and not by breaching a basic principle on which public assistance programs are based.

Therefore, we recommend against the enactment of H.R. 4138, 4139 and 5093.

H.R. 6124-ADMINISTRATIVE SIMPLIFICATION AND IMPROVEMENT OF THE
SUPPLEMENTAL SECURITY INCOME PROGRAM

Since these amendments were the subject of extensive hearings and discussions last year and were previously passed by the House, it is not necessary to discuss them in detail.

There have been serious problems in SSI error rates, delays in processing applications for SSI, and insufficient outreach to potentially eligible beneficiaries. Though a great deal more needs to be done to improve the administration of the program, it is clear that the Social Security Administration's vigorous efforts to improve the program are beginning to pay off. But H.R. 6124 has many provisions which will help speed along these improvements. They should simplify SSI administration, should reduce error rates, and should generally help improve SSI operations. In short, these amendments are constructive and will strengthen the administration of the program to the benefit of millions of deserving citizens.

We therefore urge enactment of H.R. 6124.

EXTENSION OF THE SUPPLEMENTAL SECURITY INCOME (SSI) PROGRAM TO PUERTO RICO, GUAM, AND THE VIRGIN ISLANDS

Puerto Rico, Guam and the Virgin Islands were excluded from the SSI legislation when the program was passed in 1972. Their aged, blind and disabled remain covered separately under old welfare provisions of the kind which formerly covered the states but which were replaced by the SSI program. During the last Congress, the House approved a bill which based the level of benefits on a ratio equal to the per capita income of these jurisdictions to the per capita income of the state of the U.S. with the lowest per capita income. The Senate refused to accept the provision. But we urge the Subcommittee to look on the provision as only a first step toward treating U.S. citizens residing in these areas as full fledged citizens of the United States under all titles of the Social Security Act without any discrimination.

ELIMINATION OF THE CEILING ON FEDERAL FUNDING FOR THE AFDC PROGRAM IN PUERTO RICO, GUAM AND THE VIRGIN ISLANDS

The discriminatory practice of allowing only a minimal level of welfare assistance to the poor in Puerto Rico, Guam and the Virgin Islands, which provides their families with an income at less than 10% of the poverty level, must be stopped. They, like other needy Americans, must be able to fill their childrens' basic human needs. Therefore, we strongly favor elimination of the ceiling on federal funding for AFDC in these areas.

ESTABLISHMENT OF A SEPARATE TITLE XX SOCIAL SERVICES ENTITLEMENT FOR PUERTO RICO, GUAM AND THE VIRGIN ISLANDS

We urge the inclusion of Puerto, Guam and the Virgin Islands in Title XX on the same basis as the states.

EXTENSION OF THE $200 MILLION INCREASE IN THE TITLE XX SOCIAL

SERVICES CEILING

The AFL-CIO supports the extension of the $200 million increase in Title XX earmarked for day care purposes as defined in PL 94-401. In addition, we urge that Title XX authorization be automatically increased each year to reflect the increase in the cost of living index. Since there has been no increase in the federal ceiling since Title XX was enacted in 1975, and the severe inflationary pressures since that time have drastically reduced the purchasing power of available social services dollars, we urge that an amount which reflects those increases be added to the ceiling.

ESTABLISHMENT OF AN ENTITLEMENT PROGRAM FOR CHILD WELFARE SERVICES WHICH ARE NOW AUTHORIZED UNDER TITLE IV-B OF THE SOCIAL SECURITY ACT

The AFL-CIO supports every effort to rebuild and strengthen this unique program which was set up to provide a mechanism to help any child-regardless of the family's income-receive desperately needed services in order to

prevent long range social deprivation. We urge that Title IV-B be converted to an entitlement program at the full $266 million level of authorization. We feel this is a minuscule amount of money compared to the amount which will be spent in the long run if the child welfare services system in the country is not strengthened. An entitlement, rather than an annual appropriation, is needed in order to assure funding continuity for purposes of the longer range planning states must begin to do if they are to invest their limited resources wisely.

A maintenance of effort provision should be adopted to forestall supplanting of state and local funds and to insure that new money made available for IV-B actually results in a new increase in services and support activities.

There is a desperate need to enlarge and strengthen a nationwide foster care system. States must be able to locate and plan for children who are homeless or in danger. In order to effectively achieve such a system, it is necessary to have the kind of federal/state partnership in planning which is required in Title IV-B. In recent years there has been a total absence of federal involvement, let alone leadership, providedd in this planning process. We urge that HEW be required to delineate its role and responsibilities in assisting the states to develop child welfare service programs.

STANDARDIZATION OF THE AFDC EXPENSE DISREGARD AS PROPOSED IN THE
PRESIDENT'S BUDGET FOR FISCAL YEAR 1978

On May 17, 1976, Bert Seidman, Director of the Department of Social Security of the AFL-CIO, testified before the Subcommittee on this question. A copy of his testimony is attached. We reaffirm the position stated at that time.

PREPARED STATEMENT OF IRVIN P. SCHLOSS, DIRECTOR, GOVERNMENTAL RELATIONS OFFICE, AMERICAN FOUNDATION FOR The Blind

SUMMARY

The American Foundation for the Blind, American Association of Workers for the Blind, and Blinded Veterans Association urge favorable action on the following recommended imurovements in the SSI program under title XVI of the Social Security Act and in the social services program under title XX of that Act:

1. The provisions of H.R. 6124, which corrects a number of inequities in the SSI program.

2. Extension of SSI to Puerto Rico, Guam, and the Virgin Islands.

3. Increase in the amount of excluded income from any source to $40 monthly and in the amount of first monthly earnings to $100 on the basis of increases in the Consumer Price Index and pay schedules of Federal employees. 4. Coverage of an essential person in the household of an SSI beneficiary not previously on state public assistance rolls.

5. Extension of eligibility of SSI recipients for food stamps through June 30, 1978.

6. Amendment of the Social Security Act to provide for recognition of private nonprofit organizations to assist applicants and beneficiaries with claims and authorization of free desk space in social security local offices for organization representatives similar to analogous Veterans Administration procedure.

7. Extension of the $200 million authorization of appropriations for day care services under Title XX of the Social Security Act.

8. Increase in the authorization of appropriations for title XX by $300 million for social services to blind and disabled SSI recipients 65 and older. 9. Extension of title XX to Puerto, Guam, and the Virgin Islands with a separate annual authorization of appropriations of $16 million.

STATEMENT

Mr. Chairman and members of the Subcommittee, I appreciate this opportunity to appear before you on improvements needed in the program of supplemental security income for the aged, blind, and disabled (SSI) under title XVI of the Social Security Act as well as improvements in social services under title XX of that Act.