A bill to amend title IV of the Social Security Act to require States to make AFDC shelter payments in the form of vendor payments where an AFDC recipient has failed to make two consecutive rent payments, and for other purposes.

Amends title IV (Aid to Families with Dependent Children) of the Social Security Act to direct States to make subsequent shelter payments for AFDC recipients directly to the person furnishing shelter, on request, if a recipient has failed to make two consecutive monthly payments to any person providing shelter to that recipient. Requires such subsequent shelter payments to be held in escrow until a settlement is reached or a court orders termination of such escrow, if: (1) the recipient claims the reason for nonpayment is that the vendor has failed to meet a legal or lease requirement; or (2) the recipient claims such violations after the institution of vendor payments.

Continues such vendor payments until the State agency determines that such recipient is able and willing to make shelter payments directly to the person providing shelter. Prohibits vendor payments from exceeding the actual cost of shelter provided to the recipient.