1. It shall be the policy of the Commonwealth to expend federal block grant funds allocated to it under the Temporary Assistance for Needy Families (TANF) program established pursuant to Public Law 104-193, as amended, in a fiscally prudent manner so as to reasonably conserve unexpended allocations of such federal funds for use in offsetting future TANF program costs.

2. It is hereby acknowledged that as of June 30, 1999, there existed with the federal government an unexpended balance of $68,666,014 in federal TANF block grant funds which are available to the Commonwealth of Virginia to reimburse expenditures incurred in accordance with the adopted State plan for the TANF program. Based on projected FY 2000 spending levels, appropriations in this act, and the provisions of subparagraphs 2a and 2b, below, the Commonwealth’s accumulated balance for authorized federal TANF block grant funds is estimated at $68,120,545 on June 30, 2000; $51,043,799 on June 30, 2001; and $33,421,583 on June 30, 2002.

a. Pending final federal action on Social Services Block Grant (SSBG) reductions for federal fiscal year 2000, and in recognition of the potential for using TANF and Title IV-E funds to support programs now funded from SSBG, the Department of Social Services (DSS), in cooperation with the Department of Planning and Budget (DPB), shall develop a comprehensive SSBG/TANF spending strategy. This plan shall be submitted no later than July 14, 2000, to the Chairs of the House Appropriations and Senate Finance Committees and to the Governor through the Secretary of Health and Human Resources. An update shall be submitted within 60 days after the completion of any federal budget action that affects the availability of SSBG or TANF funds.

b. This plan shall address the following needs for new funding, among others: subsidized fee-system day care (up to $10,000,000 per year); grants for services to the hard-to-serve, including drug and alcohol treatment, English as a second language, and GED preparation (up to $15,000,000 per year); programs of non-assistance services (up to $8,000,000 per year); access to education and job opportunities personal computers and the Internet (up to $10,000,000 per year); “Right Choices for Youth” initiatives (up to $2,200,000 per year); funding to compensate for SSBG reductions, including services for at-risk youth (up to $13,000,000 per year); the Opportunity Knocks youth employment program (up to $500,000 per year); and the Economic and Employment Improvement Program for Disadvantaged Persons (up to $200,000 per year). The plan shall also address funding for a Work Incentive Payment Program to provide cash incentives to families with incomes under the federal poverty level and who have children under the age of 18 (up to $15,000,000 per year). Upon final approval of the plan by the Governor, up to a maximum of $44,474,013 the first year and $49,490,867 the second year from nongeneral funds shall be administratively appropriated by the Department of Planning and Budget.

c. Upon approval of the plan by the Governor, the Commissioner of Social Services is hereby empowered to authorize the development and implementation of TANF and TANF-related programs for the purposes of providing work subsidies, services or other non-assistance benefits described in 45 C.F.R. § 260.31(b) and (c) to needy families. The purposes of these programs shall be to enable children to be cared for in their own homes or in the homes of relatives; to end the dependence of needy parents on government benefits by promoting job preparation, work, and marriage; to prevent and reduce the incidence of out-of-wedlock pregnancies; and/or to encourage the formation and maintenance of two-parent families.

d. In addition, the Commissioner is empowered to authorize grants, contracts, and inter-departmental Memorandums of Understanding (MOUs) for intensive employment and employment support services for hard-to-serve TANF recipients.

e. DSS shall report annually to the Governor, the Secretary of Health and Human Resources, the Chairs of the House Appropriations and Senate Finance Committees, and DPB regarding planned and actual spending; program results; clients served; the location, size, implementation status, and nature of projects funded under the approved plan; results of all formal evaluations; and recommendations for continuation, expansion, and redesign of the projects. Such report shall be combined with the report required by §63.1-133.54, Code of Virginia.

3. With the executive budget each year, the Department of Planning and Budget shall provide an update to the Governor and the Chairmen of the House Appropriations and Senate Finance Committees on the total level of reserves necessary to cover likely caseload increases in the event of a future economic downturn. The Department shall collaborate with the Department of Social Services in developing its recommendations.