EXCERPTS FROM THE SOCIAL SECURITY ACT, AS AMENDED, AS IN EFFECT PRIOR TO THE 1960 AMENDMENTS

TITLE I-GRANTS TO STATES FOR OLD-AGE

ASSISTANCE

Appropriation

Section 1. For the purpose of enabling each State to furnish financial assistance, as far as practicable under the conditions in such State, to aged needy individuals and of encouraging each State, as far as practicable under such conditions, to help such individual attain selfcare, there is hereby authorized to be appropriated for each fiscal year a sum sufficient to carry out the purposes of this title. The sums made available under this section shall be used for making payments to States which have submitted, and had approved by the Secretary of Health, Education, and Welfare " (hereinafter referred to as the "Secretary") State plans for old-age assistance.

State Old-Age Assistance Plans

Sec. 2. (a) A State plan for old-age assistance must (1) provide that it shall be in effect in all political subdivisions of the State, and, if administered by them, be mandatory upon them; (2) provide for financial participation by the State; (3) either provide for the establishment or designation of a single State agency to administer the plan, or provide for the establishment or designation of a single State agency to supervise the administration of the plan; (4) provide for granting an opportunity for a fair hearing before the State agency to any individual whose claim for old-age assistance is denied or is not acted upon with reasonable promptness; (5) provide such methods of administration (including after January 1, 1940, methods relating to the establishment and maintenance of personnel standards on a merit basis, except that the Secretary shall exercise no authority with respect to the selection, tenure of office, and compensation of any individual employed in accordance with such methods) as are found by the Secretary to be necessary for the proper and efficient operation of the plan; (6) provide that the State agency will make such reports, in such form and containing such information, as the Secretary may from time to time require, and comply with such provisions as the Secretary may from time to time find necessary to assure the correctness and verification of such reports; (7) effective July 1, 1941, provide that the State agency shall, in determining need, take into consideration any other income and resources of an individual claiming old-age assistance; (8) effective July 1, 1941, provide safeguards which restrict the use or disclosure of information concerning applicants and recipients to purposes directly connected with the adminis

112 Formerly the (Federal Security) Administrator. See "Administration of the Social Security Act," under the Preface.

113 See sec. 1109, p. 166, for modification of this clause with respect to the disregarding of earned income of recipients of aid to the blind.

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tration of old-age assistance; (9) provide that all individuals wishing to make application for old-age assistance shall have opportunity to do so, and that old-age assistance shall be furnished with reasonable promptness to all eligible individuals; (10) effective July 1, 1953, provide, if the plan includes payments to individuals in private or public institutions, for the establishment or designation of a State authority or authorities which shall be responsible for establishing and maintaining standards for such institutions; and (11) provide a description of the services (if any) which the State agency makes available to applicants for and recipients of old-age asistance to help them attain self-care, including a description of the steps taken to assure, in the provision of such services, maximum utilization of other agencies providing similar or related services.115

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Payment to States

Sec. 3. (a) From the sums appropriated therefor, the Secretary of the Treasury shall pay to each State which has an approved plan for old-age assistance, for each quarter, beginning with the quarter commencing October 1, 1958, (1) in the case of any State other than Puerto Rico, the Virgin Islands, and Guam, an amount equal to the sum of the following proportions of the total amounts expended during such quarter as old-age assistance under the State plan (including expenditures for insurance premiums for medical or any other type of remedial care or the cost thereof)

(A) four-fifths of such expenditures, not counting so much of any expenditure with respect to any month as exceeds the product of $30 multiplied by the total number of recipients of old-age assistance for such month (which total number, for purposes of this subsection, means (i) the number of individuals who received old-age assistance in the form of money payments for such month, plus (ii) the number of other individuals with respect to whom expenditures were made in such month as old-age assistance in the form of medical or any other type of remedial care); plus

(B) the Federal percentage of the amount by which such expenditures exceed the maximum which may be counted under clause (A), not counting so much of any expenditure with respect to any month as exceeds the product of $65 multiplied by the total number of such recipients of old-age assistance for such month;

and (2) in the case of Puerto Rico, the Virgin Islands, and Guam, an amount equal to one-half of the total of the sums expended during such quarter as old-age assistance under the State plan (including expenditures for insurance premiums for medical or any

114 This requirement has in effect been modified by the Revenue Act of 1951, 65 Stat. 452. Sec. 618 of that Act provides :

"No State or any agency or political subdivision thereof shall be deprived of any grantin-aid or other payment to which it otherwise is or has become entitled pursuant to title I, IV, X, or XIV of the Social Security Act, as amended, by reason of the enactment or enforcement by such State of any legislation prescribing any conditions under which public access may be had to records of the disbursement of any such funds or payments within such State, if such legislation prohibits the use of any list or names obtained through such access to such records for commercial or political purposes."

115 Sec. 510 of P. L. 85-840 added the wording in clause (11) beginning with "including" and through the end of the sentence, effective October 1, 1958.

other type of remedial care or the cost thereof), not counting so much of any expenditure with respect to any month as exceeds $35 multiplied by the total number of recipients of old-age assistance for such month; and (3) in the case of any State, an amount equal to onehalf of the total of the sums expended during such quarter as found necessary by the Secretary of Health, Education, and Welfare for the proper and efficient administration of the State plan, including services which are provided by the staff of the State agency (or of the local agency administering the State plan in the political subdivision) to applicants for and recipients of old-age assistance to help them attain self-care,116

TITLE II—FEDERAL OLD-AGE, SURVIVORS, AND DISABILITY INSURANCE BENEFITS

Board of Trustees

Sec. 201. (c) (3) Report immediately to the Congress whenever the Board of Trustees is of the opinion that during the ensuing five fiscal years either of the Trust Funds will exceed three times the highest annual expenditures from such Trust Fund anticipated during that five-fiscal-year period, and whenever the Board of Trustees is of the opinion that the amount of either of the Trust Funds is unduly small; and

Investment of Trust Funds

(d) It shall be the duty of the Managing Trustee ot invest such portion of the Trust Funds as is not, in his judgment, required to meet current withdrawals. Such investments may be made only in interestbearing obligations of the United States or in obligations guaranteed as to both principal and interest by the United States. For such purpose such obligations may be acquired (1) on original issue at the issue price, 117 or (2) by purchase of outstanding obligations at the market price. The purposes for which obligations of the United States may be issued under the Second Liberty Bond Act, as amended, are hereby extended to authorize the issuance at par of public-debt obligations for purchase by the Trust Funds. Such obligations issued for purchase by the Trust Funds shall have maturities fixed with due regard for the needs of the Trust Funds, and bear interest at a rate equal to the average rate of interest, computed as to the end of the calendar month next preceding the date of such issue, borne by all marketable interest-bearing obligations of the United States then forming a part of the Public Debt that are not due or callable until after the expiration of five years from the date of original issue; except that where such average rate is not a multiple of one-eighth of 1

116 Sec. 501 of P. L. 85-840 amended sec. 3 (a) in its entirety, effective October 1, 1958. For subsec. 3 (a) as it read prior to this amendment, see p. 272.

Pursuant to sec. 9 of the Act of April 19, 1950 (64 Stat. 44, 47), the Secretary of the Treasury must also pay to States, in addition to the amounts provided by sec. 3 (a) of the Social Security Act, an amount equal to 80 percent of the State share of expendi tures under the State plan with respect to Navajo and Hopi Indians.

See also sec. 1108 (p. 166) for a further limitation on the amounts which may be certified for payment to Puerto Rico, the Virgin Islands, and Guam for any fiscal year. 117 P. L. 86-346, sec. 104 (2) changed "on original issue at par" to "on original issue at the issue price" effective September 22, 1959.

per centum, the rate of interest of such obligations shall be the multiple of one-eighth of 1 per centum nearest such average rate. Such obligations shall be issued for purchase by the Trust Funds only if the Managing Trustee determines that the purchase in the market of other interest-bearing obligations of the United States, or of obligations guaranteed as to both principal and interest by the United States on original issue or at the market price, is not in the public interest.

Child's Insurance Benefits

Sec 202. (d) (1) (C) was dependent upon such individual(i) if such individual had a period of disability which did not end prior to the month in which he became entitled to old-age or disability insurance benefits or (if he has died) prior to the month in which he died, at the beginning of such period or at the time he became entitled to such benefits or died,

(ii) if such individual did not have such a period and is living, at the time such application was filed, or

(iii) if such individual did not have such a period and has died, at the time of such death, *

Deductions on Account of Work or Failure to Have Child in Care

Sec. 203. (b) Deductions, in such amounts and at such time or times as the Secretary shall determine, shall be made from any payment or payments under this title to which an individual is entitled, until the total of such deductions equals such individual's benefit or benefits under section 202 for any month

(1) in which such individual is under the age of seventy-two and for which month he is charged with any earnings under the provisions of subsection (e) of this section; or

(2) in which such individual is under the age of seventy-two and on seven or more different calendar days of which he engaged in noncovered remunerative activity outside the United States; or

(3) in which such individual, if a wife under age 65 entitled to a wife's insurance benefit, did not have in her care (individually or jointly with her husband) a child of her husband entitled to a child's insurance benefit and such wife's insurance benefit for such month was not reduced under the provisions of section 202 (q); or (4) in which such individual, if a widow entitled to a mother's insurance benefit, did not have in her care a child of her deceased husband entitled to a child's insurance benefit; or

(5) in which such individual, if a former wife divorced entitled to a mother's insurance benefit, did not have in her care a child of her deceased former husband, who (A) is her son, daughter, or legally adopted child and (B) is entitled to a child's insurance benefit on the basis of the wages and self-employment income of her deceased former husband.

For purposes of paragraphs (3), (4), and (5), a child shall not be considered to be entitled to a child's insurance benefit for any month in which an event specified in section 222 (b) occurs with respect to such child. No deduction shall be made under this subsection from

any child's insurance benefit for the month in which the child entitled to such benefit attained the age of eighteen or any subsequent month. Deductions From Dependents' Benefits Because of Work by Old-Age Insurance Beneficiary

(c) (1) Deductions shall be made from any wife's, husband's, or child's insurance benefit, based on the wages and self-employment income of an individual entitled to old-age insurance benefits 118 to which a wife, husband, or child is entitled, until the total of such deductions equals such wife's, husband's, or child's insurance benefit or benefits under section 202 for any month

(A) in which the individual, on the basis of whose wages and self-employment income such benefit was payable, is under the age of seventy-two and for which month he is charged with any earnings under the provisions of subsection (e) of this section; or

(B) in which the individual referred to in subparagraph (A) 119 is under the age of seventy-two and on seven or more different calendar days of which he engaged in noncovered remunerative activity outside the United States.

(2) Deductions shall be made from any child's insurance benefit to which a child who has attained the age of eighteen is entitled or from any mother's insurance benefit to which a person is entitled, until the total of such deductions equals such child's insurance benefit or benefits or mother's insurance benefit or benefits under section 202 for any month

(A) in which such child or person entitled to mother's insurance benefit is married to an individual entitled to old-age insurance benefits under section 202 (a) who is under the age of seventytwo and for which month such individual is charged with any earnings under the provisions of subsection (e) of this section, or

(B) in which such child or person entitled to mother's insurance benefits is married to the individual referred to in subparagraph (A) and on seven or more different calendar days of which such individual engaged in noncovered remunerative activity outside the United States.120

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Months to Which Earnings Are Charged

(e) For the purposes of subsections (b) and (c)-

(1) If an individual's earnings for a taxable year of twelve months are not more than $1,200, no month in such year shall be charged with any earnings. If an individual's earnings for a taxable year of less than twelve months are not more than the product of $100 times the number of months in such year, no month in such year shall be charged with any earnings.

(2) If an individual's earnings for a taxable year of twelve months are in excess of $1,200, the amount of his earnings in

118 Sec. 205 (j) of P. L. 85-840 added the phrase "based on the wages and self-employment income of an individual entitled to old-age insurance benefits," effective with respect to monthly benefits under title II of the Social Security Act for months after August 1958, but only if an application for such benefits is filed on or after August 28, 1958. 119 Sec. 807 (f) of P. L. 85-840 added "(1)" after "(c)"; redesignated pars. (1) and (2) as subpars. (A) and (B): substituted the phrase "subparagraph (A)" for "paragraph (1)" in subpar. (B), effective with respect to monthly benefits under subsecs. (d) or (g) of sec. 202 for months in any taxable year, of the individual to whom the person entitled to such benefits is married, beginning after August 1958.

120 Sec. 307 (f) of P. L. 85-840 added new par. (2). See footnote 119 for effective date.