S.F. _____ Section 1. NEW SECTION . 239.1 Definitions. 1 As used in this chapter, unless the context otherwise 2 requires: 3 1. “Applicant” means an individual who is applying for 4 public assistance benefits in the state. 5 2. “Asset” or “asset test” means all assets of the members 6 of the applicant’s household, including all of the following: 7 a. All bank accounts, excluding retirement accounts of 8 members of the household. 9 b. All cash, excluding the first two thousand dollars of 10 members of the household. 11 c. All lottery and gambling income of the household whether 12 received as a lump sum or installment payments. 13 d. All real estate, excluding the primary household 14 residence and surrounding lot. 15 e. All other personal property excluding personal 16 belongings, household goods, and one vehicle. 17 3. “Department” means the department of health and human 18 services. 19 4. “Public assistance” means the supplemental nutrition 20 assistance program or SNAP, the Medicaid program or Medicaid 21 as defined in section 249A.2, the family investment program or 22 FIP as defined in section 239B.1, and the children’s health 23 insurance program or CHIP. 24 5. “Real-time eligibility system” means real-time electronic 25 access to a system that allows verification of all applicable 26 public assistance program eligibility information based on the 27 most recent information available to the department through 28 nonmodeled earned and unearned income, such as commercially 29 available wage data. 30 6. “Recipient” means an individual who is receiving public 31 assistance benefits in the state. 32 Sec. 2. NEW SECTION . 239.2 Asset test for supplemental 33 nutrition assistance program. 34 1. For the purposes of determining eligibility for receipt 35 -1- LSB 1320XC (5) 90 pf/rh 1/ 15

S.F. _____ of SNAP benefits, the department shall conduct an asset test 1 on all members of the applicant’s household. The allowable 2 financial resources to be included in or excluded from a 3 determination of eligibility for SNAP shall be those specified 4 in 7 U.S.C. §2014(g)(1). 5 2. Prior to determining eligibility for SNAP benefits, 6 the department shall access, at a minimum, for every member 7 of the applicant’s household, the following information from 8 the following federal, state, and miscellaneous sources, or 9 successor sources: 10 a. Federal sources and information: 11 (1) Earned and unearned income information maintained by 12 the internal revenue service. 13 (2) The following sources and information maintained by the 14 United States social security administration: 15 (a) Earned income information. 16 (b) Death register information. 17 (c) Prisoner or incarceration status information. 18 (d) Supplemental security income information maintained in 19 the state data exchange database. 20 (e) Beneficiary records and earnings information maintained 21 in the beneficiary and earnings data exchange database. 22 (f) Earnings and pension information maintained in the 23 beneficiary earnings exchange record system database. 24 (3) The following sources and information maintained by the 25 United States department of health and human services: 26 (a) Income and employment information maintained in the 27 national directory of new hires database by the office of child 28 support enforcement of the administration for children and 29 families. 30 (b) Other federal data sources maintained by the office of 31 child support enforcement of the administration for children 32 and families. 33 b. State sources and information: 34 (1) The department’s sources and information including but 35 -2- LSB 1320XC (5) 90 pf/rh 2/ 15

S.F. _____ not limited to all of the following: 1 (a) Income and employment information maintained by the 2 child support recovery unit. 3 (b) Child care assistance information maintained by the 4 division of child and family services. 5 (c) Enrollment status in other public assistance programs. 6 (2) The department of workforce development sources and 7 information including all of the following: 8 (a) Employment information. 9 (b) Employer weekly, monthly, and quarterly reports of 10 income and unemployment insurance payments. 11 (3) The Iowa public employees’ retirement system for 12 earnings and pension information. 13 c. Miscellaneous sources: 14 (1) Any existing real-time database of persons currently 15 receiving benefits in other states, such as the national 16 accuracy clearinghouse. 17 (2) Any databases maintained by the Iowa lottery 18 commission. 19 (3) Any existing real-time eligibility system that includes 20 employment and income information maintained by a consumer 21 reporting agency, as defined by the federal Fair Credit 22 Reporting Act, 15 U.S.C. §1681a, for the purpose of obtaining 23 real-time employment and income information. 24 3. Prior to determining eligibility for SNAP benefits, the 25 department shall access information for every member of the 26 applicant’s household from the following public records: 27 a. A nationwide public records data source of physical asset 28 ownership. The data source may include but is not limited to 29 real property, automobiles, watercraft, aircraft, and luxury 30 vehicles, or any other vehicle owned by the applicant. 31 b. National and state financial institutions in order 32 to locate undisclosed depository accounts or verify account 33 balances of disclosed accounts. 34 4. The department shall enter into a memorandum of 35 -3- LSB 1320XC (5) 90 pf/rh 3/ 15

S.F. _____ understanding with any department, division, bureau, section, 1 unit, or any other subunit of a department to obtain the 2 information specified in this section. 3 5. The provisions of this section shall not apply if every 4 member of the applicant’s household receives supplemental 5 security income. 6 Sec. 3. NEW SECTION . 239.3 Cooperation with child support 7 enforcement —— supplemental nutrition assistance program 8 eligibility. 9 An applicant for SNAP benefits shall be required to 10 cooperate with the child support recovery unit as a condition 11 of eligibility as specified in 7 C.F.R. §273.11(o). 12 Sec. 4. NEW SECTION . 239.4 Verification and authentication 13 systems —— public assistance programs. 14 1. By July 1, 2024, the department shall redesign an 15 existing system; establish a new computerized income, asset, 16 and identity eligibility verification system; or contract with 17 a third-party vendor to provide for identity verification, 18 identity authentication, asset verification, and dual 19 enrollment prevention in order to deter waste, fraud, and 20 abuse in each public assistance program administered by the 21 department. 22 2. The department may contract with a third-party vendor 23 to develop or provide a service for a real-time eligibility 24 system that allows the department to verify or authenticate 25 income, assets, and identity eligibility of applicants and 26 recipients to prevent fraud, misrepresentation, and inadequate 27 documentation when determining eligibility for public 28 assistance programs. The system shall be accessed prior to 29 determining eligibility, periodically between eligibility 30 redeterminations, and during eligibility redeterminations 31 and reviews. The department may also contract with a 32 third-party vendor to provide information to facilitate 33 reviews of recipient eligibility conducted by the department. 34 Specifically, the department may contract with a third-party 35 -4- LSB 1320XC (5) 90 pf/rh 4/ 15

S.F. _____ consumer reporting agency, as defined by the federal Fair 1 Credit Reporting Act, 15 U.S.C. §1681a, for the purpose of 2 obtaining real-time employment and income information. 3 3. A contract entered into under this section shall provide, 4 at a minimum, for all of the following: 5 a. The establishment of the annual savings amount from 6 utilization of the system or service, and a provision that the 7 contract may be terminated contingent upon the savings not 8 exceeding the total yearly cost to the state for utilization of 9 the system or service. 10 b. That the contract shall not preclude the department 11 from continuing to conduct additional eligibility verification 12 or authentication processes, to receive, review, or verify 13 additional information related to the eligibility of an 14 individual, or from contracting with a third-party vendor to 15 provide additional eligibility authentication or verification 16 information. 17 4. The department shall seek federal approval as necessary 18 to implement and administer this section. 19 Sec. 5. NEW SECTION . 239.5 Public assistance programs —— 20 applicant and recipient eligibility verification. 21 1. All applications for initial public assistance 22 program benefits and all determinations of ongoing recipient 23 eligibility shall be processed through a system as specified 24 in this section. Complete initial applications shall be 25 processed within the minimum period required by federal law. 26 Prior to determining initial eligibility of an applicant for, 27 or ongoing eligibility of a recipient of, public assistance, 28 the department shall access information for every applicant or 29 recipient from the following federal, state, and other sources: 30 a. Federal sources and information: 31 (1) Earned and unearned income information maintained by 32 the internal revenue service. 33 (2) The following sources and information maintained by the 34 United States social security administration: 35 -5- LSB 1320XC (5) 90 pf/rh 5/ 15

S.F. _____ (a) Earned income information. 1 (b) Death register information. 2 (c) Prisoner or incarceration status information. 3 (d) Supplemental security income information maintained in 4 the state data exchange database. 5 (e) Beneficiary records and earnings information maintained 6 in the beneficiary and earnings data exchange database. 7 (f) Earnings and pension information maintained in the 8 beneficiary earnings exchange record system database. 9 (3) The following sources and information maintained by the 10 United States department of health and human services: 11 (a) Income and employment information maintained in the 12 national directory of new hires database by the office of child 13 support enforcement of the administration for children and 14 families. 15 (b) Other federal data sources maintained by the office of 16 child support enforcement of the administration for children 17 and families. 18 (4) Information maintained by the United States citizenship 19 and immigration services of the United States department of 20 homeland security. 21 (5) Payment information for public housing and section 8 22 housing assistance guidelines maintained by the United States 23 department of housing and urban development. 24 (6) National fleeing felon information maintained by the 25 United States federal bureau of investigation. 26 b. State sources and information: 27 (1) The department’s sources and information including but 28 not limited to all of the following: 29 (a) Income and employment information maintained by the 30 child support recovery unit. 31 (b) Child care assistance information maintained by the 32 division of child and family services. 33 (c) Enrollment status in other public assistance programs. 34 (2) The department of workforce development sources and 35 -6- LSB 1320XC (5) 90 pf/rh 6/ 15

S.F. _____ information including all of the following: 1 (a) Employment information. 2 (b) Employer weekly, monthly, and quarterly reports of 3 income and unemployment insurance payments. 4 (3) The Iowa public employees’ retirement system for 5 earnings and pension information. 6 c. Other sources including all of the following: 7 (1) Any existing real-time database of persons currently 8 receiving benefits in other states, such as the national 9 accuracy clearinghouse. 10 (2) An available database of persons who currently hold a 11 license, permit, or certificate from any state agency, the cost 12 of which exceeds five hundred dollars. 13 (3) Wage reporting and similar information maintained by 14 states contiguous to Iowa. 15 (4) A third-party consumer reporting agency, as defined 16 by the federal Fair Credit Reporting Act, 15 U.S.C. §1681a, 17 for the purpose of obtaining real-time employment and income 18 information. 19 2. Prior to determining the initial eligibility of an 20 applicant for, or the ongoing eligibility of a recipient 21 of, public assistance benefits, the department shall access 22 information for every applicant or recipient from, at a 23 minimum, the following public records: 24 a. A nationwide public records data source of physical asset 25 ownership. The data source may include but is not limited to 26 real property, automobiles, watercraft, aircraft, and luxury 27 vehicles, or any other vehicle owned by the applicant for or 28 recipient of assistance. 29 b. A nationwide public records data source of incarcerated 30 individuals. 31 c. A nationwide best address and driver’s license data 32 source to verify that individuals are residents of the state. 33 d. A comprehensive public records database from which the 34 department may identify potential identity fraud or identity 35 -7- LSB 1320XC (5) 90 pf/rh 7/ 15

S.F. _____ theft that is capable of closely associating name, social 1 security number, date of birth, phone, and address information. 2 e. National and local financial institutions in order 3 to locate undisclosed depository accounts or verify account 4 balances of disclosed accounts. 5 f. Outstanding default or arrest warrant information. 6 3. The state may contract with a third-party consumer 7 reporting agency, as defined by the federal Fair Credit 8 Reporting Act, 15 U.S.C. §1681a, for the purpose of obtaining 9 real-time employment and income information under this section. 10 Sec. 6. NEW SECTION . 239.6 Identity authentication. 11 Unless otherwise prohibited by federal law or regulation, 12 prior to the department awarding public assistance benefits, an 13 applicant shall complete a computerized identity authentication 14 process to confirm the identity of the applicant. Identity 15 authentication shall be accomplished through a knowledge-based 16 questionnaire consisting of financial and personal questions. 17 The questionnaire shall contain questions tailored to assist 18 persons without a bank account or those who have poor access 19 to financial and banking services or who do not have an 20 established credit history. The questionnaire may be submitted 21 by the applicant online, in person, or via telephone. 22 Sec. 7. NEW SECTION . 239.7 Case review of applicant and 23 recipient information. 24 1. If the information obtained from a review of an 25 applicant’s or recipient’s information under this chapter does 26 not result in the department finding a discrepancy or change 27 in an individual’s circumstances affecting eligibility, the 28 department shall take no further action. 29 2. If the information obtained from a review of the 30 applicant’s or recipient’s information under this chapter 31 results in the department finding a discrepancy or change in 32 the individual’s circumstances affecting eligibility, the 33 department shall respond in accordance with the provisions of 34 section 239.8. 35 -8- LSB 1320XC (5) 90 pf/rh 8/ 15

S.F. _____ Sec. 8. NEW SECTION . 239.8 Notice and right to be heard. 1 1. An applicant for, or recipient of, public assistance 2 shall be provided written notice and the opportunity to explain 3 any issues identified in a review performed under this chapter 4 for initial eligibility or redetermination of eligibility. 5 Unless otherwise prohibited by federal law or regulation, 6 a self-declaration by an applicant or recipient shall not 7 be accepted as verification of categorical and financial 8 eligibility during such review. 9 2. The notice provided to the applicant or recipient shall 10 describe in sufficient detail the circumstances of the issue 11 identified, the manner in which the applicant or recipient 12 may respond, and the consequences of failing to respond to 13 the notice or resolve the issue identified. The applicant or 14 recipient shall be provided ten days to respond to the notice. 15 The department may request additional information as necessary 16 to reach a decision. 17 3. An applicant or recipient may respond to the notice as 18 follows: 19 a. By disagreeing with the findings of the department. If 20 the applicant or recipient responds in a timely manner and 21 disagrees with the findings of the department, the department 22 shall reevaluate the circumstances to determine if the 23 applicant’s or recipient’s position is valid. If, through 24 reevaluation, the department finds that the department is in 25 error, the department shall take immediate action to correct 26 the error. If, through reevaluation, the department affirms 27 that the applicant’s or recipient’s position is invalid, the 28 department shall determine the effect on the applicant’s or 29 recipient’s eligibility and take appropriate action. Written 30 notice of the department’s determination and the actions taken 31 shall be provided to the applicant or recipient. 32 b. By agreeing with the findings of the department. If 33 the applicant or recipient responds in a timely manner and 34 agrees with the findings of the department, the department 35 -9- LSB 1320XC (5) 90 pf/rh 9/ 15

S.F. _____ shall determine the effect on the applicant’s or recipient’s 1 eligibility and take appropriate action. Written notice of the 2 department’s determination and actions taken shall be provided 3 to the applicant or recipient. 4 4. If the applicant or recipient fails to respond to the 5 notice in a timely manner, the department shall provide notice 6 to terminate the applicant’s application or to discontinue 7 the recipient’s enrollment for failure to cooperate, and 8 shall terminate the applicant’s application or discontinue 9 the recipient’s enrollment. The applicant’s or recipient’s 10 eligibility for such public assistance shall not be established 11 or reestablished until the issue has been resolved. 12 Sec. 9. NEW SECTION . 239.9 Referrals for fraud, 13 misrepresentation, or inadequate documentation. 14 1. Following a review of an applicant’s or recipient’s 15 eligibility under this chapter, the department may refer cases 16 of suspected fraud along with any supportive information to the 17 department of inspections and appeals for review. 18 2. In cases of substantiated fraud, upon conviction, the 19 state shall review all appropriate legal options including 20 but not limited to removal of a recipient from other public 21 assistance programs and garnishment of wages or state income 22 tax refunds until the department recovers an equal amount of 23 benefits fraudulently claimed. 24 3. The department may refer suspected cases of fraud, 25 misrepresentation, or inadequate documentation relating to 26 initial or continued eligibility to appropriate state agencies, 27 divisions, or departments for review of eligibility issues in 28 programs providing public benefits other than those as defined 29 in this chapter. 30 Sec. 10. NEW SECTION . 239.10 Administration —— rules —— 31 reporting. 32 1. The department of health and human services shall adopt 33 rules pursuant to chapter 17A to administer this chapter. 34 2. The department shall submit a report to the governor 35 -10- LSB 1320XC (5) 90 pf/rh 10/ 15

S.F. _____ and the general assembly by January 15, 2025, and by January 1 15 annually thereafter through January 15, 2030, detailing the 2 impact of the verification and authentication measures taken 3 under this chapter. The report shall include data for all 4 affected public assistance programs including the number of 5 cases reviewed, the number of cases closed, the number of fraud 6 investigation referrals made, and the amount of savings and 7 cost avoidance realized from the provisions of this chapter. 8 Sec. 11. IMPLEMENTATION. 9 1. The department of health and human services shall request 10 federal approval including for any state plan amendment or 11 waiver necessary to administer this Act. 12 2. The provisions of this Act requiring federal approval 13 shall be implemented upon receipt of such federal approval. 14 3. The provisions of this Act not requiring federal approval 15 shall be implemented as specified in this Act, or if not 16 specified in this Act, no later than July 1, 2025. 17 4. The department may contract with multiple third-party 18 vendors to administer this Act. 19 EXPLANATION 20 The inclusion of this explanation does not constitute agreement with 21 the explanation’s substance by the members of the general assembly. 22 This bill relates to public assistance program oversight. 23 The bill relates to various eligibility verification and 24 authentication measures under new Code chapter 239. 25 The bill provides definitions used in the new Code chapter. 26 The bill requires the department of health and human 27 services (HHS or the department) to conduct an asset test on 28 all members of the household of an applicant for SNAP benefits. 29 The bill specifies the minimum information from federal, state, 30 and other data sources and public records that HHS must access 31 prior to determining eligibility for an applicant’s SNAP 32 benefits. The bill requires HHS to enter into a memorandum of 33 understanding with any department or subunit of a department 34 to obtain the information specified. The bill provisions do 35 -11- LSB 1320XC (5) 90 pf/rh 11/ 15

S.F. _____ not apply if every member of the applicant’s household receives 1 supplemental security income. 2 The bill requires that an applicant for SNAP benefits shall 3 cooperate with the child support recovery unit as a condition 4 of eligibility for SNAP benefits. 5 The bill requires that by July 1, 2024, HHS shall redesign 6 an existing system; establish a new computerized income, 7 asset, and identity eligibility verification system; or 8 contract with a third-party vendor to provide for identity 9 verification, identity authentication, asset verification, 10 and dual enrollment prevention in each public assistance 11 program administered by HHS. The department may contract 12 with a third-party vendor to develop or provide a real-time 13 eligibility system to verify or authenticate income, assets, 14 and identity eligibility of applicants and recipients. The 15 system shall be accessed prior to determining eligibility, 16 periodically between eligibility redeterminations, and during 17 eligibility redeterminations and reviews. The department may 18 contract with a third-party vendor to provide information to 19 facilitate reviews of recipient eligibility conducted by HHS. 20 A contract entered into to provide a system or service must 21 establish the annual savings amount from utilization of the 22 system or service, and include a provision that the contract 23 may be terminated contingent upon the savings not exceeding the 24 total yearly cost to the state for utilization of the system or 25 service. The contract does not preclude HHS from continuing to 26 conduct additional eligibility verification or authentication 27 processes to receive, review, or verify additional information 28 related to the eligibility of an individual; or from 29 contracting with a third-party vendor to provide additional 30 eligibility authentication or verification information. 31 The department shall seek federal approval as necessary to 32 implement and administer this provision of the bill. 33 The bill requires that for all applications for initial 34 public assistance program benefits and all determinations of 35 -12- LSB 1320XC (5) 90 pf/rh 12/ 15

S.F. _____ ongoing recipient eligibility processed by HHS, HHS shall 1 access information for every applicant or recipient from 2 specified federal, state, and other sources, and from specified 3 public records. 4 The bill requires that prior to awarding public assistance 5 benefits to an applicant, the applicant shall complete a 6 computerized identity authentication process to confirm the 7 identity of the applicant through the use of a knowledge-based 8 questionnaire consisting of financial and personal questions 9 tailored to assist persons without a bank account or those who 10 have poor access to financial and banking services or who do 11 not have an established credit history. The questionnaire 12 may be submitted by the applicant online, in person, or via 13 telephone. 14 The bill provides that if information obtained from a review 15 of an applicant’s or recipient’s information under the bill 16 does not result in HHS finding a discrepancy or change in an 17 individual’s circumstances affecting eligibility, HHS shall 18 take no further action. 19 If the information obtained from a review of the applicant’s 20 or recipient’s information under the bill results in HHS 21 finding a discrepancy or a change in the individual’s 22 circumstances affecting eligibility, HHS shall provide written 23 notice to the individual and the opportunity to explain any 24 issues identified. Unless otherwise prohibited by federal law 25 or regulation, a self-declaration by an applicant or recipient 26 shall not be accepted as verification of categorical and 27 financial eligibility during such review. 28 The notice provided to the applicant or recipient shall 29 describe in sufficient detail the circumstances of the issue 30 identified, the manner in which the applicant or recipient 31 may respond, and the consequences of failing to respond to 32 the notice or resolve the issue identified. The applicant or 33 recipient shall be provided 10 days to respond to the notice. 34 The department may request additional information as necessary 35 -13- LSB 1320XC (5) 90 pf/rh 13/ 15

S.F. _____ to reach a decision. 1 The bill specifies the processes and results dependent upon 2 whether an applicant or recipient responds by disagreeing 3 or agreeing with the findings of a review by HHS. If the 4 applicant or recipient fails to respond to the notice in a 5 timely manner, HHS shall provide notice to terminate the 6 applicant’s application or to discontinue the recipient’s 7 enrollment for failure to cooperate, and shall terminate 8 the applicant’s application or discontinue the recipient’s 9 enrollment. The applicant’s or recipient’s eligibility 10 for such public assistance shall not be established or 11 reestablished until the issue has been resolved. 12 Following a review of an applicant’s or recipient’s 13 eligibility, HHS may refer cases of suspected fraud along with 14 any supportive information to the department of inspections 15 and appeals for review. In cases of substantiated fraud, 16 upon conviction, the state shall review all appropriate legal 17 options including but not limited to removal of a recipient 18 from other public assistance programs and garnishment of wages 19 or state income tax refunds until HHS recovers an equal amount 20 of benefits fraudulently claimed. The department may refer 21 suspected cases of fraud, misrepresentation, or inadequate 22 documentation relating to initial or continued eligibility 23 to appropriate state agencies, divisions, or departments 24 for review of eligibility issues in other public assistance 25 programs. 26 Under the bill, HHS shall adopt administrative rules to 27 administer the Code chapter. The department shall submit a 28 report to the governor and the general assembly by January 29 15, 2025, and by January 15 annually thereafter through 30 January 15, 2030, detailing the impact of the verification 31 and authentication measures taken under the bill. The report 32 shall include data for all affected public assistance programs 33 including the number of cases reviewed, the number of cases 34 closed, the number of fraud investigation referrals made, and 35 -14- LSB 1320XC (5) 90 pf/rh 14/ 15

S.F. _____ the amount of savings and cost avoidance realized from the 1 provisions of the bill. 2 The department shall request federal approval including for 3 any state plan amendment or waiver necessary to administer the 4 bill, and the provisions of the bill requiring federal approval 5 shall be implemented upon receipt of such federal approval. 6 The provisions of the bill that do not require federal approval 7 shall be implemented as specified in the bill or, if not 8 specified in the bill, no later than July 1, 2024. 9 -15- LSB 1320XC (5) 90 pf/rh 15/ 15