[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 1071 Introduced in Senate (IS)]







104th CONGRESS
  1st Session
                                S. 1071

To eliminate the National Foundation on the Arts and the Humanities, to 
    establish a National Endowment for Arts, Humanities, and Museum 
                   Services, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                July 25 (legislative day, July 10), 1995

 Mrs. Hutchison (for herself and Mr. Bennett) introduced the following 
 bill; which was read twice and referred to the Committee on Labor and 
                            Human Resources

_______________________________________________________________________

                                 A BILL


 
To eliminate the National Foundation on the Arts and the Humanities, to 
    establish a National Endowment for Arts, Humanities, and Museum 
                   Services, and for other purposes.
    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.

    This Act may be cited as the ``National Endowment Restructuring Act 
of 1995''.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds the following:
            (1) The arts and the humanities belong to all the people of 
        the United States.
            (2) The encouragement and support of national progress and 
        scholarship in the arts and the humanities, while primarily 
        matters for private and local initiative, are also appropriate 
        matters of concern for the Federal Government.
            (3) Democracy demands wisdom and vision in citizens. 
        Democracy must therefore foster and support a form of 
        education, and access to the arts and the humanities.
            (4) It is necessary and appropriate for the Federal 
        Government to complement, assist, and add to programs for the 
        advancement of the arts and the humanities by States, regional 
        groups, and nationally prominent groups and institutions. In 
        complementing, assisting, and adding to the programs, the 
        Government must be sensitive to the nature of public 
        sponsorship. Public funding of the arts and humanities is 
        subject to the conditions that traditionally govern the use of 
        public money. Such funding should contribute to public support 
        and confidence in the use of taxpayer funds. Public funds 
        provided by the Federal Government must ultimately serve the 
        public purposes that Congress defines.
            (5) The arts and the humanities reflect the high place 
        accorded by the people of the United States to the rich 
        cultural heritage of the Nation and to the fostering of mutual 
        respect for the diverse beliefs and values of all persons and 
        groups.
            (6) The world leadership that has come to the United States 
        cannot rest solely on superior power, wealth, and technology, 
        but must be solidly founded on worldwide respect and admiration 
        for the high qualities of the Nation as a leader in the realm 
        of ideas and of the spirit.
            (7) Students of the United States should receive in school, 
        background and preparation in the arts and the humanities to 
        enable the students to recognize and appreciate the aesthetic 
        dimensions of their lives, the diversity of excellence that 
        comprises their cultural heritage, and artistic and scholarly 
        expression.
            (8) To fulfill the educational mission of the United 
        States, achieve an orderly continuation of free society, and 
        provide models of excellence to the people of the United 
        States, the Federal Government must transmit the achievement 
        and values of civilization from the past via the present to the 
        future, and make widely available the greatest achievements of 
        art.
            (9) The Federal Government should--
                    (A) assist in the conservation of the unique 
                cultural, historic, and scientific heritage of the 
                United States through support for modernization of 
                facilities, and updating of programs, by museums; and
                    (B) assist and promote the educational role of 
                museums, in conjunction with elementary, secondary, and 
                postsecondary education programs, and through other 
                educational programs.
            (10) In order to implement the findings and purposes 
        described in this section, it is desirable to establish a 
        National Endowment for Arts, Humanities, and Museum Services.
    (b) Purposes.--The purposes of this Act are--
            (1) to support nationally prominent groups and institutions 
        in carrying out the collection, preservation, performance, 
        display, or dissemination of nationally significant projects, 
        productions, or workshops in the arts;
            (2) to support nationally prominent groups, institutions, 
        and scholars in carrying out nationally significant projects 
        and workshops in the humanities, including providing 
        fellowships, scholarships, and stipends to carry out nationally 
        significant research, education, preservation, and literacy 
        activities, and producing nationally significant publications, 
        in the humanities;
            (3) to support local groups and institutions of clearly 
        recognized value to communities in carrying out the collection, 
        preservation, performance, display, or dissemination of locally 
        significant projects, productions, or workshops in the arts, or 
        carrying out activities in the arts for such purposes as are 
        identified by the Council as being of regional, State, or 
        community importance;
            (4) to support local groups and institutions of clearly 
        recognized value to communities in carrying out locally 
        significant projects and workshops in the humanities, including 
        carrying out locally significant research, education, 
        preservation, and literacy activities, and producing 
        significant publications, in the humanities, or carrying out 
        activities in the humanities for such purposes as are 
        identified by the Council as being of regional, State, or 
        community importance;
            (5) to strengthen elementary and secondary education in the 
        arts and in the humanities, with special emphasis on 
        strengthening such education for underserved communities; and
            (6) to support museums to increase and improve museum 
        services.

SEC. 3. DEFINITIONS.

    As used in this Act:
            (1) Arts.--The term ``arts'' includes--
                    (A) music (instrumental and vocal), dance, drama, 
                folk art, creative writing, architecture and allied 
                fields, painting, sculpture, photography, graphic and 
                craft arts, industrial design, costume and fashion 
                design, motion pictures, television, radio, film, 
                video, and tape and sound recording;
                    (B) the traditional arts practiced by the diverse 
                peoples of the United States;
                    (C) the presentation, performance, execution, and 
                exhibition of the arts described in subparagraph (A) or 
                (B); and
                    (D) the study and application of the arts described 
                in subparagraph (A) or (B) to the human environment.
            (2) Council.--The term ``Council'' means the National 
        Council on Arts, Humanities, and Museum Services established 
        under section 10.
            (3) Director.--The term ``Director'' means the Director of 
        the National Endowment appointed under section 5.
            (4) Final judgment.--The term ``final judgment'' means a 
        judgment that is either--
                    (A) not reviewed by any other court that has 
                authority to review such judgment; or
                    (B) is not reviewable by any other court.
            (5) Grant.--The term ``grant'' includes a loan, a contract, 
        and a cooperative agreement.
            (6) Group.--The term ``group'' includes any State agency or 
        other public agency, and any nonprofit society, institution, 
        organization, association, museum, or establishment in the 
        United States, whether or not incorporated.
            (7) Humanities.--The term ``humanities'' includes--
                    (A) the study and interpretation of--
                            (i) language, both modern and classical, 
                        linguistics, literature, history, 
                        jurisprudence, philosophy, archaeology, 
                        comparative religion, and ethics;
                            (ii) the history, criticism, and theory of 
                        the arts; and
                            (iii) the aspects of the social sciences 
                        that have humanistic content and employ 
                        humanistic methods; and
                    (B) the study and application of the humanities 
                described in subparagraph (A) to the human environment 
                with particular attention to--
                            (i) reflecting the diverse heritage, 
                        traditions, and history of the United States; 
                        and
                            (ii) the relevance of the humanities 
                        described in subparagraph (A) to the current 
                        conditions of national life (as of the date of 
                        the study and application).
            (8) Museum.--The term ``museum'' means a public or private 
        nonprofit agency or institution organized on a permanent basis 
        for essentially educational or esthetic purposes, that, 
        utilizing a professional staff, owns or utilizes tangible 
        objects, cares for the objects, and exhibits the objects to the 
        public on a regular basis.
            (9) National endowment.--The term ``National Endowment'' 
        means the National Endowment for Arts, Humanities, and Museum 
        Services established under section 4.
            (10) Obscene; determined to be obscene.--
                    (A) Obscene.--The term ``obscene'' means, with 
                respect to a project, production, or workshop that--
                            (i) the average person, applying 
                        contemporary community standards, would find 
                        that such project, production, or workshop, 
                        when taken as a whole, appeals to the prurient 
                        interest;
                            (ii) such project, production, or workshop 
                        depicts or describes sexual conduct in a 
                        patently offensive way; and
                            (iii) such project, production, or 
                        workshop, when taken as a whole, lacks serious 
                        literary, artistic, or scientific value.
                    (B) Determined to be obscene.--The term 
                ``determined to be obscene'' means determined, in a 
                final judgment of a court of record and of competent 
                jurisdiction in the United States, to be obscene.
            (11) Production.--The term ``production'' means a play 
        (with or without music), a ballet, dance or choral performance, 
        a concert, a recital, an opera, an exhibition, a reading, a 
        motion picture, television, radio, film, video, and a tape or 
        sound recording, and any other activity involving the execution 
        or rendition of the arts and meeting such standards as may be 
        approved by the Director of the National Endowment.
            (12) Project.--
                    (A) In general.--The term ``project'' means an 
                activity organized to carry out the objectives of this 
                Act, including--
                            (i) in the case of an activity in the arts, 
                        a program to foster United States artistic 
                        creativity, to commission a work of art, or to 
                        develop and enhance the widest public access, 
                        knowledge, and understanding of the arts, and 
                        includes, where appropriate, rental or purchase 
                        of a facility, rental or purchase of land, and 
                        acquisition of equipment; and
                            (ii) in the case of an activity in the 
                        humanities, an activity organized to carry out 
                        the humanistic objectives of this Act.
                    (B) Renovation or construction.--Such term also 
                includes--
                            (i) the renovation of a facility if--
                                    (I) the amount of the expenditure 
                                of Federal funds for such purpose in 
                                the case of any facility does not 
                                exceed $250,000; and
                                    (II) two-thirds of the members of 
                                the Council (who are present and 
                                voting) recommend a grant involving an 
                                expenditure for such purpose; and
                            (ii) with respect to a grant under section 
                        7(a), the construction of a facility, if--
                                    (I) such construction is for 
                                demonstration purposes or under unusual 
                                circumstances in which there is no 
                                other manner by which to accomplish an 
                                artistic or humanistic purpose, as 
                                appropriate; and
                                    (II) two-thirds of the members of 
                                the Council (who are present and 
                                voting) recommend a grant involving an 
                                expenditure for such purpose.
            (13) Regional group.--The term `regional group' means any 
        multistate group, whether or not representative of contiguous 
        States.
            (14) State.--The term ``State'' includes, in addition to 
        the several States of the United States, the Commonwealth of 
        Puerto Rico, the District of Columbia, Guam, American Samoa, 
        the Commonwealth of the Northern Mariana Islands, and the 
        United States Virgin Islands.
            (15) Underserved community.--The term ``underserved 
        community'' means a community that, for geographic or economic 
        reasons, would be unable to sustain an education program in the 
        arts or the humanities without a grant made under section 
        7(b)(1), as determined by the State in which the community is 
        located.
            (16) Workshop.--The term ``workshop'' means an activity the 
        primary purpose of which is--
                    (A) in the case of an activity in the arts, to 
                encourage the artistic development or enjoyment of 
                amateur, student, or other nonprofessional 
                participants; or
                    (B) in the case of an activity in the humanities, 
                to promote scholarship and teaching among the 
                participants.

SEC. 4. NATIONAL ENDOWMENT FOR ARTS, HUMANITIES, AND MUSEUM SERVICES.

    There is established a National Endowment for Arts, Humanities, and 
Museum Services, which shall administer the activities established 
under this Act. The National Endowment shall be an independent 
establishment, as defined in section 104 of title 5, United States 
Code.

SEC. 5. DIRECTOR.

    (a) Appointment.--The National Endowment shall be headed by a 
Director, who shall be appointed by the President, by and with the 
advice and consent of the Senate.
    (b) Term.--
            (1) In general.--The term of office of the Director shall 
        be 4 years, except that any Director appointed to fill a 
        vacancy shall serve for the remainder of the term for which the 
        predecessor of the Director was appointed. Notwithstanding any 
        other provision of this paragraph, on the expiration of the 
        term of office of the Director, the Director shall serve until 
        the successor to the Director is appointed and has qualified.
            (2) Reappointment.--The Director shall be eligible for 
        reappointment.
    (c) Compensation.--The Director shall be compensated at the rate 
provided for level II of the Executive Schedule under section 5313 of 
title 5, United States Code.
    (d) Duties.--The Director shall--
            (1) make grants in accordance with this Act; and
            (2) enforce the requirements of this Act.

SEC. 6. DEPUTY DIRECTORS.

    (a) Appointment.--There shall be a Deputy Director for Arts, a 
Deputy Director for Humanities, and a Deputy Director for Museum 
Services in the National Endowment.
    (b) Compensation.--Each Deputy Director referred to in subsection 
(a) shall be compensated at the rate provided for level III of the 
Executive Schedule under section 5314 of title 5, United States Code.
    (c) General Duties.--Each Deputy Director referred to in subsection 
(a) shall, with respect to activities carried out under this Act that 
relate to the cultural areas in the jurisdiction of the Deputy 
Director--
            (1) prepare and submit to the Council information on 
        applicants for grants under this Act;
            (2) evaluate activities carried out with assistance made 
        available through such a grant; and
            (3) make recommendations to the Director with respect to 
        the enforcement of this Act.
    (d) Particular Duties.--
            (1) Nondelegation.--The Deputy Director for Museum Services 
        shall not delegate any of the functions of the Deputy Director 
        to any person who is not directly responsible to the Deputy 
        Director.
            (2) Coordination.--The Deputy Director for Museum Services 
        shall ensure coordination of the policies and activities of the 
        National Endowment relating to museum services with the 
        policies and activities of other agencies and offices of the 
        Federal Government having interest in and responsibilities for 
        the improvement of museums. Such agencies and offices shall 
        include the other offices of the National Endowment, the 
        National Science Foundation, appropriate units in the 
        Department of Education, the Library of Congress, the 
        Smithsonian Institution, and related agencies and offices.

SEC. 7. GRANTS.

    (a) Grants to Nationally Prominent Groups, Institutions, and 
Scholars.--
            (1) General authority.--
                    (A) Arts.--Using the funds reserved under section 
                17(a)(3)(B)(i), the Director, acting on the 
                recommendation of the Council, shall make grants to 
                nationally prominent groups and institutions to pay for 
                the Federal share of the cost of collection, 
                preservation, performance, display, or dissemination of 
                nationally significant projects, productions, or 
                workshops in the arts.
                    (B) Humanities.--Using the funds reserved under 
                section 17(a)(3)(B)(ii), the Director, acting on the 
                recommendation of the Council, shall make grants to 
                nationally prominent groups, institutions, and scholars 
                to pay for the Federal share of the cost of carrying 
                out nationally significant projects and workshops in 
                the humanities, including--
                            (i) providing fellowships, scholarships, 
                        and stipends to carry out nationally 
                        significant research, education, preservation, 
                        and literacy activities in the humanities; and
                            (ii) producing significant publications in 
                        the humanities.
            (2) Criteria for nationally prominent groups, institutions, 
        and scholars.--The Director, acting on the recommendation of 
        the Council, shall issue, with due regard to the importance of 
        broad geographic distribution, criteria for eligibility for 
        grants under this subsection so as to ensure that the grants 
        benefit nationally prominent groups, institutions, and 
        scholars, whose activities reflect a generally recognized 
        standard of excellence and merit.
            (3) Application.--To be eligible to receive a grant under 
        subparagraph (A) or (B) of paragraph (1), an institution shall 
        submit an application described in section 8 to the Director at 
        such time, in such manner, and containing such information as 
        the Director may require.
            (4) Preference.--In selecting groups and institutions to 
        receive grants under paragraph (1)(A), the Director shall give 
        preference to groups and institutions that submit applications 
        for projects, productions, and workshops that reach the 
        broadest possible audiences.
            (5) Federal share requirement.--
                    (A) In general.--Except as provided in 
                subparagraphs (B) and (C), in the case of any grant 
                made under this subsection, the Federal share referred 
                to in paragraph (1) shall be 25 percent.
                    (B) Certain groups.--In the case of any grant made 
                under this subsection to a group with an annual budget 
                in excess of $3,000,000, the Federal share referred to 
                in paragraph (1) shall be 16.67 percent.
                    (C) Adjustments.--The Director may increase the 
                Federal share applicable under this subsection for a 
                designated grant recipient, with review by the Council. 
                The Director shall not increase the Federal share above 
                50 percent for the recipient. Not more than 10 percent 
                of the funds made available by the National Endowment 
                for grants under this subsection for any fiscal year 
                may be available for grants for the fiscal year for 
                which the Director increases the applicable Federal 
                share.
    (b) Grants to States.--
            (1) General authority.--
                    (A) Arts.--Using the funds reserved under section 
                17(a)(3)(B)(iii), the Director, acting on the 
                recommendation of the Council, shall make grants to pay 
                for the Federal share of the cost of enabling States 
                and regional groups to support local groups and 
                institutions of clearly recognized value to communities 
                in--
                            (i) carrying out the collection, 
                        preservation, performance, display, or 
                        dissemination of locally significant projects, 
                        productions, or workshops in the arts, 
                        including strengthening elementary and 
                        secondary education in the arts, with special 
                        emphasis on strengthening such education in 
                        underserved communities; or
                            (ii) carrying out activities in the arts 
                        for such purposes as are identified by the 
                        Council as being of regional, State, or 
                        community importance.
                    (B) Humanities.--Using the funds reserved under 
                section 17(a)(3)(B)(iv), the Director, acting on the 
                recommendation of the Council, shall make grants to pay 
                for the Federal share of the cost of enabling States 
                and regional groups to support local groups and 
                institutions of clearly recognized value to communities 
                in--
                            (i) carrying out locally significant 
                        projects and workshops in the humanities, 
                        including--
                                    (I) carrying out locally 
                                significant research, education, 
                                preservation, and literacy activities 
                                in the humanities;
                                    (II) producing significant 
                                publications in the humanities; and
                                    (III) strengthening elementary and 
                                secondary education in the humanities, 
                                with special emphasis on strengthening 
                                such education in underserved 
                                communities; or
                            (ii) carrying out activities in the 
                        humanities for such purposes as are identified 
                        by the Council as being of regional, State, or 
                        community importance.
            (2) Allotment.--
                    (A) Arts.--
                            (i) In general.--Except as provided in 
                        clause (ii), of the sums available to carry out 
                        paragraph (1)(A) for any fiscal year, the 
                        Director shall allot to each State or regional 
                        group that has an application approved by the 
                        Director an amount that bears the same 
                        relationship to such sums as the total number 
                        of individuals in the State or regional group, 
                        as appropriate, bears to the total number of 
                        individuals in all States.
                            (ii) State minimum.--Of the sums available 
                        to carry out paragraph (1)(A) for any fiscal 
                        year, the Director shall allot at least 
                        $200,000 to each State that has an application 
                        approved by the Director (including each State 
                        in a regional group that has an application 
                        approved by the Director).
                    (B) Humanities.--
                            (i) In general.--Except as provided in 
                        clause (ii), of the sums available to carry out 
                        paragraph (1)(B) for any fiscal year, the 
                        Director shall allot to each State or regional 
                        group that has an application approved by the 
                        Director an amount that bears the same 
                        relationship to such sums as the total number 
                        of individuals in the State or regional group, 
                        as appropriate, bears to the total number of 
                        individuals in all States.
                            (ii) State minimum.--Of the sums available 
                        to carry out paragraph (1)(B) for any fiscal 
                        year, the Director shall allot at least 
                        $200,000 to each State that has an application 
                        approved by the Director (including each State 
                        in a regional group that has an application 
                        approved by the Director).
            (3) Application.--In order to receive a grant under 
        subparagraph (A) or (B) of paragraph (1) for any fiscal year, a 
        State or regional group shall submit an application described 
        in section 8 to the Director at such time and in such manner as 
        shall be specified by the Director and accompany such 
        application with a State or regional plan (referred to in this 
        Act as a ``State plan'') that the Director finds--
                    (A) designates or provides for the establishment of 
                a State or regional agency (referred to in this Act as 
                a ``State agency'') as the sole agency for the 
                administration of the State plan;
                    (B) provides that funds paid to the State or 
                regional group under subparagraph (A) or (B), as 
                appropriate, of paragraph (1) will be expended solely 
                on activities described in paragraph (1) and approved 
                by the State agency;
                    (C) provides that the State agency will make such 
                reports, in such manner and containing such 
                information, as the Director may from time to time 
                require, including a description of the progress made 
                toward achieving the objectives of the State plan;
                    (D) provides--
                            (i) an assurance that the State agency has 
                        held, after reasonable notice, public meetings 
                        in the State or regional group to allow groups 
                        of artists or scholars, interested arts or 
                        humanities organizations, and the public to 
                        present views and make recommendations 
                        regarding the State plan; and
                            (ii) a summary of such recommendations and 
                        the response of the State agency to such 
                        recommendations; and
                    (E) contains--
                            (i) for the most recent preceding year for 
                        which information is available, a description 
                        of the level of participation by individuals 
                        and organizations in activities supported by 
                        funding from the State agency under 
                        subparagraph (A) or (B), as appropriate, of 
                        paragraph (1), and a description of the extent 
                        to which activities supported by funding from 
                        the State agency under subparagraph (A) or (B), 
                        as appropriate, of paragraph (1) were available 
                        to all people and communities in the State or 
                        regional group; and
                            (ii) a description of activities supported 
                        by funding from the State agency under 
                        subparagraph (A) or (B), as appropriate, of 
                        paragraph (1) that exist or are being developed 
                        to secure greater access to the arts and the 
                        humanities to all people or communities 
                        described in clause (i).
            (4) Approval.--The Director may not approve an application 
        described in paragraph (3) unless the accompanying State plan 
        satisfies the requirements specified in paragraph (3).
            (5) Education.--A State or regional group may use--
                    (A) not more than 5 percent of the funding provided 
                through a grant made under paragraph (1)(A) to pay for 
                the Federal share of the cost of strengthening 
                elementary and secondary education in the arts, with 
                special emphasis on strengthening such education in 
                underserved communities; and
                    (B) not more than 5 percent of the funding provided 
                through a grant made under paragraph (1)(B) to pay for 
                the Federal share of the cost of strengthening 
                elementary and secondary education in the humanities, 
                with special emphasis on strengthening such education 
                in underserved communities.
            (6) Federal share.--
                    (A) In general.--Funding provided through a grant 
                made under subparagraph (A) or (B) of paragraph (1) to 
                a State or regional group for any fiscal year shall be 
                available to each State or regional group that has an 
                application approved by the Director, and has the State 
                plan accompanying the application in effect on the 
                first day of such fiscal year, to pay not more than 50 
                percent of the total cost of carrying out any activity 
                described in paragraph (1).
                    (B) Excess portion.--Except as provided in 
                subparagraph (C), the portion of the funding provided 
                through any grant made under subparagraph (A) or (B), 
                as appropriate, of paragraph (1) to a State or regional 
                group for any fiscal year that exceeds $125,000 shall 
                be available, at the discretion of the Director, to pay 
                not more than 100 percent of such cost of carrying out 
                an activity under subparagraph (A) or (B), as 
                appropriate, of paragraph (1) if such activity would be 
                unavailable to the residents of the State or regional 
                group without such portion.
                    (C) Percentage of grant funds.--The portion of the 
                funding described in subparagraph (B) for any fiscal 
                year that is available to pay not more than 100 percent 
                of such cost, as described in subparagraph (B), shall 
                not exceed 20 percent of the total funding provided 
                through such grant for such fiscal year.
            (7) Prohibition on supplanting non-federal funds.--Funds 
        made available under subparagraph (A) or (B) of paragraph (1) 
        shall be used to supplement, and shall not supplant, non-
        Federal funds expended for supporting activities described in 
        such subparagraph.
    (c) Museum Services.--
            (1) Grants.--Using the funds reserved under section 
        17(a)(3)(A), the Director, acting on the recommendation of the 
        Council, may make grants to museums to pay for the Federal 
        share of the cost of increasing and improving museum services, 
        through such activities as--
                    (A) programs to enable museums to construct or 
                install displays, interpretations, and exhibitions in 
                order to improve museum services to the public;
                    (B) assisting museums in developing and maintaining 
                professionally trained or otherwise experienced staff 
                to meet their needs;
                    (C) assisting museums in meeting their 
                administrative costs in preserving and maintaining 
                their collections, exhibiting the collections to the 
                public, and providing educational programs to the 
                public through the use of the collections;
                    (D) assisting museums in cooperating with each 
                other in developing traveling exhibitions, meeting 
                transportation costs, and identifying and locating 
                collections available for loan; and
                    (E) assisting museums in conservation of their 
                collections.
            (2) Contracts and cooperative agreements.--
                    (A) Projects to strengthen museum services.--The 
                Director, acting on the recommendation of the Council, 
                may enter into contracts and cooperative agreements 
                with appropriate entities to pay for the Federal share 
                of enabling the entities to undertake projects designed 
                to strengthen museum services, except
                 that any contracts or cooperative agreements entered 
into pursuant to this paragraph shall be effective only to such extent 
or in such amounts as are provided in appropriations Acts.
                    (B) Limitation on use.--No financial assistance may 
                be provided under this paragraph to pay for operational 
                expenses.
                    (C) Limitation on amount.--The aggregate amount of 
                funding made available under this paragraph for a 
                fiscal year shall not exceed 15 percent of the funding 
                made available under this subsection for such fiscal 
                year.
            (3) Federal share.--
                    (A) In general.--Except as provided in 
                subparagraphs (B) and (C), in the case of any grant 
                made under this subsection, the Federal share referred 
                to in paragraphs (1) and (2) shall be 25 percent.
                    (B) Certain groups.--In the case of any grant made 
                under this subsection to a group with an annual budget 
                in excess of $3,000,000, the Federal share referred to 
                in paragraphs (1) and (2) shall be 16.67 percent.
                    (C) Adjustments.--The Director may increase the 
                Federal share applicable under this subsection for a 
                designated grant recipient, with review by the Council. 
                The Director shall not increase the Federal share above 
                50 percent for the recipient. Not more than 20 percent 
                of the funds made available by the National Endowment 
                for grants under this subsection for any fiscal year 
                may be available for grants for the fiscal year for 
                which the Director increases the applicable Federal 
                share.

SEC. 8. APPLICATION PROCEDURES.

    (a) Application Requirement.--No grant shall be made under this Act 
to any person unless the person submits an application to the Director 
in accordance with regulations and procedures established by the 
Director.
    (b) Procedures.--
            (1) In general.--
                    (A) Considerations.--In establishing such 
                regulations and procedures for applications, the 
                Director shall ensure that--
                            (i) excellence and merit of the projects, 
                        productions, and workshops described in the 
                        application are the criteria by which the 
                        applications are judged, taking into 
                        consideration general standards of decency and 
                        respect for the diverse beliefs and values of 
                        the public of the United States; and
                            (ii) the projects, productions, and 
                        workshops described in the applications, and 
                        awards of grants under this Act, are consistent 
                        with the objectives of section 7 and this 
                        section.
                    (B) Obscenity provisions.--Such regulations and 
                procedures shall clearly indicate that activities that 
                are determined to be obscene shall not be funded under 
                this Act. Projects, productions, and workshops that are 
                determined to be obscene shall be prohibited from 
                receiving grants under this Act from the National 
                Endowment.
            (2) Construction.--The disapproval or approval by the 
        Director of an application for a grant under this Act shall not 
        be construed to mean, and shall not be considered to be 
        evidence that, the project, production, or workshop, for which 
        the applicant requested a grant, is or is not obscene.

SEC. 9. ADVISORY PANELS.

    (a) In General.--The Director shall utilize review by advisory 
panels--
            (1) as the first step in the review of applications 
        submitted under this Act; and
            (2) to make recommendations to the Council in all cases 
        involving requests for grants authorized under this Act, except 
        cases in which the Director exercises authority delegated under 
        section 10(d)(2)(D).
    (b) Membership.--In making appointments to the panels, the Director 
shall--
            (1) ensure that each panel is composed of individuals, who 
        by reason of their achievement, scholarship, or creativity in 
        the humanities, the arts, or museum services, have national 
        standing in their fields, except as provided in paragraph (2); 
        and
            (2) ensure that each panel includes at least 2 members 
        representing the general public.
    (c) Procedures.--
            (1) Criteria.--In reviewing the applications, such panels 
        shall recommend applications for projects, productions, and 
        workshops on the basis of excellence and merit, consistent with 
        section 8(b)(1)(A)(i).
            (2) Amounts.--The panels may recommend only general ranges 
        of funding to be provided through the grants and may not 
        recommend specific amounts of such funding.
            (3) Regulations and procedures.--The Director shall issue 
        regulations and establish standardized procedures for the 
        panels that shall, at a minimum--
                    (A) require each such panel--
                            (i) to create written records summarizing--
                                    (I) all meetings and discussions of 
                                such panel; and
                                    (II) the recommendations made by 
                                such panel to the Council; and
                            (ii) to make such records available to the 
                        public in a manner that protects the privacy of 
                        individual applicants and panel members;
                    (B) permit, when necessary and feasible, a site 
                visit to view the work of an applicant and deliver a 
                written report on the work being reviewed, in order to 
                assist panelists in making their recommendations; and
                    (C) ensure that the panels recommend more 
                applicants for grants than are anticipated can be 
                provided funding through the grants with available 
                funds.
            (4) Prohibition on conflicts of interest.--
                    (A) In general.--In making appointments to the 
                panels, the Director shall ensure that an individual 
                who has a pending application for a grant authorized 
                under this Act, or who is an employee or agent of an 
                organization with such a pending application, or who 
                has a direct or indirect financial interest in any 
                application under consideration by such a panel, does 
                not serve as a member of any panel before which such 
                application is pending.
                    (B) Duration.--The prohibition described in 
                subparagraph (A) shall commence with respect to such 
                individual beginning on the date such application is 
                submitted, and shall continue until a final decision on 
                the application has been reached by the Director.

SEC. 10. NATIONAL COUNCIL ON ARTS, HUMANITIES, AND MUSEUM SERVICES.

    (a) Establishment.--There is established in the National Endowment 
a National Council on Arts, Humanities, and Museum Services.
    (b) Composition and Qualifications.--
            (1) Composition.--The Council shall consist of the Director 
        and 18 members appointed by the President, by and with the 
        advice and consent of the Senate, of whom--
                    (A) 6 shall be appointed from among persons 
                nominated jointly by the Speaker and the Minority 
                Leader of the House of Representatives, after 
                consultation with the Director;
                    (B) 6 shall be appointed from among persons 
                nominated jointly by the Majority Leader and the 
                Minority Leader of the Senate, after consultation with 
                the Director; and
                    (C) 6 shall be appointed after consultation by the 
                President with the Director.
            (2) Qualifications.--Such appointed members shall be 
        selected from among persons who--
                    (A) are nationally recognized and widely esteemed 
                for their broad knowledge of, sound judgment regarding, 
                expertise in, and experience with the arts, the 
                humanities, or museum services; and
                    (B) have well-established records of distinguished 
                service, or have achieved widely recognized eminence in 
                the arts, in the humanities, or with respect to museum 
                services.
    (c) Terms.--Each appointed member of the Council shall serve for a 
term of 6 years, and the terms of office shall be staggered. No member 
shall be eligible for reappointment during the 2-year period following 
the expiration of the term of the member. Any member appointed to fill 
a vacancy shall serve for the remainder of the term for which the 
predecessor of the member was appointed. Notwithstanding any other 
provision of this subsection, a member shall serve after the expiration 
of the term of the member until the successor to the member takes 
office.
    (d) Duties and Powers.--
            (1) Advice to director.--The Council shall advise the 
        Director with respect to policies, programs, and procedures for 
        carrying out the functions, duties, or responsibilities of the 
        Director under this Act, including policies with respect to 
        funding awarded through grants made under this Act.
            (2) Review of applications for grants.--
                    (A) In general.--The Council shall review 
                applications for grants authorized under this Act and 
                make recommendations to the Director with respect to 
                the approval of each application and the amount of 
                funding (if any) to provide to each applicant through 
                such a grant.
                    (B) Recommendations.--The Council shall make 
                recommendations to the Director concerning--
                            (i) whether to approve particular 
                        applications for grants authorized under this 
                        Act that are determined by the Council to 
                        present excellence and merit; and
                            (ii) the amount of funding that the 
                        Director should provide through such a grant 
                        with respect to each such application the 
                        Council recommends for approval.
                    (C) Action of director.--The Director shall not 
                approve or disapprove any application for a grant 
                authorized under this Act until the Director has 
                received the recommendation of the Council on such 
                application. The Director shall have final authority to 
                approve each application, except that the Director may 
                only provide to an applicant the amount of funding 
                recommended by the Council for the grant and may not 
                approve an application with respect to which the 
                Council makes a negative recommendation.
                    (D) Delegations.--In the case of an application 
                involving $30,000 or less, the Director may approve or 
                disapprove such application if such action is taken 
                pursuant to the terms of an express and direct 
                delegation of authority from the Council to the 
                Director. Each such action by the Director shall be 
                reviewed by the Council. Such action shall be used with 
                discretion and shall not become a normal practice of 
                providing assistance under this Act. The terms of any 
                such delegation of authority shall not permit 
                obligations for expenditure of funds under such 
                delegation for any fiscal year that exceed an amount 
                equal to 10 percent of the sums that are appropriated 
                for the fiscal year pursuant to section 17(a)(1) and 
                that remain available after the reservation made by 
                section 17(a)(2).
    (e) Chairperson.--The Director shall serve as the chairperson of 
the Council.
    (f) Compensation and Travel Expenses.--
            (1) Compensation.--Each member of the Council who is not an 
        officer or employee of the Federal Government shall be 
        compensated at a rate to be fixed by the President, but not to 
        exceed the daily equivalent of the maximum rate authorized for 
        a position above grade GS-15 of the General Schedule under 
        section 5108 of title 5, United States Code, for each day 
        (including travel time) during which such member is engaged in 
        the performance of the duties of the Council. All members of 
        the Council who are officers or employees of the Federal 
        Government shall serve without compensation in addition to 
        compensation received for their services as officers or 
        employees of the Federal Government.
            (2) Travel expenses.--The members of the Council shall be 
        allowed travel expenses, including per diem in lieu of 
        subsistence, in the same amounts and to the same extent, as 
        authorized under section 5703 of title 5, United States Code, 
        for persons employed intermittently in Federal Government 
        service.
    (g) Coordination.--The Council, with the advice of the Deputy 
Directors referred to in section 6(a), shall take steps to ensure that 
the policies and activities of the National Endowment are coordinated 
with other activities of the Federal Government.

SEC. 11. LIMITATIONS ON GRANTS.

    (a) Prohibition on Grants to Individuals.--Neither the Director nor 
a recipient of a grant under this Act may use funds made available 
under this Act to make a grant to an individual, except that the 
Director may make grants to nationally prominent scholars as provided 
in section 7(a)(1)(B).
    (b) Requirements for Groups.--A group shall be eligible to be an 
indirect recipient of a grant made under this Act if--
            (1) no part of the net earnings of the group inures to the 
        benefit of any private stockholder, or individual; and
            (2) a donation to such group is allowable as a charitable 
        contribution under section 170(c) of the Internal Revenue Code 
        of 1986.
    (c) Prohibition on Lobbying.--In accordance with section 1913 of 
title 18, United States Code, and except as otherwise provided in such 
section, no part of the funds appropriated under this Act shall be used 
directly or indirectly to pay for any personal service, advertisement, 
telegram, telephone, letter, printed or written matter, or other 
device, intended or designed to influence in any manner a Member of 
Congress, to favor or oppose, by vote or otherwise, any legislation or 
appropriation by Congress. This subsection shall be enforced in 
accordance with the last sentence of section 1913 of title 18, United 
States Code.
    (d) Prohibition on Subgrants.--The Director shall establish 
procedures to ensure that no funding provided through a grant made 
under this Act, except a grant made directly to a State or regional 
group, may be used to make a grant to any other organization or 
individual to conduct activity independent of the direct grant 
recipient. Nothing in this subsection shall prohibit payments made in 
exchange for goods or services rendered.
    (e) Prohibition on Seasonal Support.--No grant awarded under this 
Act may be used for seasonal support of a project, production, or 
workshop.
    (f) Prohibition on Preferential Treatment.--No officer or employee 
of the National Endowment may give preferential treatment to any 
individual or group on the basis of race, color, national origin, or 
gender in providing benefits or services under this Act.
    (g) Installments.--The Director shall establish procedures to 
provide for the distribution of funding provided through grants made 
under this Act to recipients in installments except in exceptional 
cases in which the Director determines that installments are not 
practicable. In providing any such installments to a recipient of a 
grant under this Act, the Director shall ensure that--
            (1) not more than two-thirds of such funding may be 
        provided at the time the application for the grant is approved; 
        and
            (2) the remainder of such funding may not be provided until 
        the Director finds that the recipient of such grant is 
        complying substantially with this Act and with the conditions 
        under which such funding is provided to such recipient.
    (h) Labor Standards.--
            (1) In general.--It shall be a condition of the receipt of 
        any grant under this Act that the grant recipient furnish 
        adequate assurances to the Secretary of Labor that--
                    (A) all professional performers and related or 
                supporting professional personnel employed on 
                activities that are financed in whole or in part under 
                this Act will be paid, without subsequent deduction or 
                rebate on any account, not less than the minimum 
                compensation as determined by the Secretary of Labor to 
                be the prevailing minimum compensation for persons 
                employed in similar activities; and
                    (B) no part of any activity that is financed in 
                whole or in part under this Act will be performed or 
                engaged in under working conditions that are unsanitary 
                or hazardous or dangerous to the health and safety of 
                the employees engaged in such activity.
            (2) Evidence.--Compliance with the safety and sanitary laws 
        of the State in which the activity described in paragraph 
        (1)(B) is to take place shall be prima facie evidence of 
        compliance with the assurance described in paragraph (1)(B).
            (3) Standards, regulations, and procedures.--The Secretary 
        of Labor shall have the authority to prescribe such standards, 
        regulations, and procedures as the Secretary of Labor may 
        determine to be necessary or appropriate to carry out this 
        subsection.

SEC. 12. ADMINISTRATION.

    (a) Authorities of Director.--In addition to any authorities vested 
in the Director by other provisions of this Act, the Director, in 
carrying out the functions of the Director, shall have authority--
            (1) to prescribe such regulations as the Director 
        determines to be necessary governing the manner in which the 
        functions of the Director shall be carried out;
            (2) in the discretion of the Director--
                    (A) after receiving the recommendation of the 
                Council, to receive money and other property donated, 
                bequeathed, or devised to the National Endowment with 
                or without a condition or restriction, including a 
                condition that the Director use other funds of the 
                National Endowment for the purposes of the donation, 
                bequest, or devise;
                    (B) to receive a donation, bequest, or devise 
                without a recommendation from the Council to provide 
                support for any application or project that can be 
                approved without Council recommendation under the 
                provisions of section 10(d)(2)(D);
                    (C) to receive a donation, bequest, or devise of 
                $15,000 or less without a recommendation from the 
                Council in the event the Council fails to provide such 
                recommendation within a reasonable period of time; and
                    (D) to use, sell, or otherwise dispose of money or 
                property received through a donation, bequest, or 
                devise described in subparagraph (A), (B), or (C) for 
                the purpose of carrying out section 7;
            (3) to appoint and determine the compensation of such 
        employees, subject to title 5, United States Code, as may be 
        necessary to carry out the functions of the Director, define 
        their duties, and supervise and direct their activities;
            (4) to procure the temporary and intermittent services of 
        experts and consultants, including panels of experts, and 
        compensate the experts and consultants in accordance with 
        section 3109 of title 5, United States Code;
            (5) to accept and utilize the voluntary services of 
        individuals and reimburse the individuals for travel expenses, 
        including per diem in lieu of subsistence, in the same amounts 
        and to the same extent as authorized under section 5703 of 
        title 5, United States Code, for persons employed 
        intermittently in Federal Government service;
            (6) to make advance, progress, and other payments without 
        regard to section 3324 of title 31, United States Code;
            (7) to rent office space in the District of Columbia; and
            (8) to make other necessary expenditures.
    (b) Inspector General.--There shall be in the National Endowment a 
single Office of the Inspector General. The Office shall be headed by 1 
Inspector General appointed in accordance with the Inspector General 
Act of 1978 (5 U.S.C. App.). The Inspector General shall carry out the 
duties prescribed in such Act, including conducting appropriate reviews 
to ensure that recipients of grants under this Act comply with the 
applicable regulations and procedures established under this Act, 
including regulations relating to accounting and financial matters.
    (c) Donations, Bequests, and Devises.--
            (1) In general.--In any case in which any money or other 
        property is donated, bequeathed, or devised to the National 
        Endowment without designation of the type of activity for which 
        the money or property is intended, the Director shall have 
        authority to receive such money or property.
            (2) Unrestricted donations, bequests, and devises.--Except 
        as provided in paragraph (3), unless the Director directs 
        otherwise, the money or property shall be deemed to have been 
        donated, bequeathed, or devised in equal shares for activities 
        relating to the arts, activities relating to the humanities, 
        and activities relating to museum services.
            (3) Restricted donations, bequests, and devises.--In any 
        case in which any money or property is donated, bequeathed, or 
        devised to the National Endowment with a condition or 
        restriction, such money or property shall be deemed to have 
        been donated, bequeathed, or devised to the Deputy Director 
        referred to in section 6(a) whose function it is to carry out 
        the purposes of the condition or restriction.
    (d) Tax Laws.--For the purposes of the income tax, gift tax, and 
estate tax laws of the United States, any money or other property 
donated, bequeathed, or devised to the National Endowment and received 
by the Director, the Deputy Director for Arts, the Deputy Director for 
Humanities, or the Deputy Director for Museum Services, under this 
section shall be deemed to have been donated, bequeathed, or devised to 
or for the use of the United States.
    (e) Review and Evaluation.--The Director shall establish procedures 
for reviewing and evaluating grants made under section 7.

SEC. 13. REPORTS.

    (a) Annual Report of Director.--The Director shall submit an annual 
report to the President for submission to the appropriate committees of 
Congress on or before the 15th day of April of each year. The report 
shall summarize the activities of the National Endowment for the 
preceding year, and shall include such recommendations as the Director 
determines to be appropriate.
    (b) Financial Reports and Compliance.--
            (1) In general.--It shall be a condition of the receipt of 
        a grant made under this Act by the Director that--
                    (A) each applicant for such grant include in the 
                application described in section 8--
                            (i) a detailed description of the proposed 
                        activities for which the grant is requested;
                            (ii) a timetable for the completion of such 
                        proposed activities; and
                            (iii) an assurance that the applicant will 
                        meet the standards of excellence and merit; and
                    (B) each such grant recipient agree to and comply 
                with requirements to submit to the Director--
                            (i) interim reports, including an annual 
                        report for each activity carried out under the 
                        grant during a period exceeding 1 year, 
                        describing the progress of the grant recipient 
                        in carrying out such activity and compliance by 
                        the grant recipient with the conditions of 
                        receipt of such grant;
                            (ii) financial reports containing such 
                        information as the Director determines to be 
                        necessary to ensure that the funding made 
                        available through the grant is expended in 
                        accordance with the terms and conditions under 
                        which the grant is made;
                            (iii) a final report describing the 
                        activity carried out with the funding provided 
                        through the grant and the compliance by the 
                        grant recipient with the conditions of receipt 
                        of such grant, including the condition that the 
                        work assisted meet the standards of excellence 
                        and merit; and
                            (iv) in the case of a project or 
                        production, and if practicable, as determined 
                        by the Director, a copy of such project or 
                        production.
            (2) Report requirements.--The Director shall determine the 
        appropriate form and timing of interim reporting described in 
        paragraph (1)(B)(i) for a grant recipient under this Act. The 
        reports and copy described in clauses (ii), (iii), and (iv) of 
        paragraph (1)(B) shall be due not later than 90 days after the 
        end of the period for which such grant recipient receives 
        funding through the grant or 90 days after the completion of 
        the project, production, or workshop, whichever occurs earlier. 
        The Director may extend the 90-day period if the recipient 
        shows good cause why such an extension should be granted.

SEC. 14. SANCTIONS AND PAYMENTS.

    (a) Failure To Satisfy Purposes.--If any recipient of a grant made 
under this Act, or an indirect recipient of funding provided through 
the grant, substantially fails to satisfy the purposes for which such 
grant is made, as determined by the Director, the Director may--
            (1) for purposes of determining whether to make any 
        subsequent funding to the direct or indirect recipient under 
        this Act, take into consideration the results of the post-award 
        evaluation conducted in accordance with section 12(e);
            (2) prohibit the direct and indirect recipients from using 
        the name of, or in any way associating the project, production, 
        or workshop for which the grant was received with, the National 
        Endowment; and
            (3) if such project, production, or workshop is published, 
        require that the publication contain the following statement: 
        ``The opinions, findings, conclusions, and recommendations 
        expressed in this publication do not reflect the views of the 
        National Endowment for Arts, Humanities, and Museum 
        Services.''.
    (b) Noncompliance.--
            (1) In general.--The Director shall take the actions 
        described in paragraph (2) whenever the Director, after 
        providing reasonable notice and an opportunity for hearing, 
        finds that--
                    (A) a direct recipient of a grant under this Act, 
                or an indirect recipient of funding provided through 
                the grant, is not complying substantially with the 
                provisions of this Act;
                    (B) a State agency that received a grant under this 
                Act, or an indirect recipient of funding provided 
                through the grant, is not complying substantially with 
                terms and conditions of the State plan accompanying the 
                application approved for the grant under this Act; or
                    (C) any funding provided under this Act to a 
                recipient or State agency described in subparagraph (A) 
                or (B) has been diverted from the purposes for which 
                such funding was provided.
            (2) Actions.--On making the finding described in paragraph 
        (1), the Director shall immediately notify the direct recipient 
        or State agency that received the funding at issue that--
                    (A) no further funding will be provided under this 
                Act to such recipient or agency until there is no 
                longer any default or failure to comply or the 
                diversion is corrected; or
                    (B) if compliance or correction is impossible, 
                until such recipient or agency repays or arranges the 
                repayment of the Federal funds that were improperly 
                diverted or expended.
    (c) Obscene Works.--
            (1) Determination.--If, after providing reasonable notice 
        and opportunity for a hearing on the record, the Director 
        determines that a direct recipient of a grant under this Act, 
        or an indirect recipient of funding provided through the grant, 
        used the funding for an activity that is determined to be 
        obscene, the Director shall require that until the direct 
        recipient repays such funding (in such amount, and under such 
        terms and conditions, as the Director determines to be 
        appropriate) to the National Endowment, no subsequent funding 
        shall be provided under this Act to such recipient.
            (2) Crediting.--Funds repaid under this subsection to the 
        National Endowment shall be deposited in the Treasury of the 
        United States and credited as miscellaneous receipts.
            (3) Application.--This subsection shall not apply with 
        respect to grants made before October 1, 1990.
    (d) Enforcement With Respect to Grants Made Under Other Acts.--For 
purposes of sections 5(d), 6(c) (other than paragraph (1) of such 
section), 12(b), and 13, and this section, references to this Act shall 
be deemed to include references to the National Foundation on the Arts 
and Humanities Act of 1965 (20 U.S.C. 951 et seq.), as in effect on the 
day before the date of enactment of this Act, and the Museum Services 
Act (20 U.S.C. 961 et seq.), as in effect on such day.

SEC. 15. AWARDS.

    The Director, with the advice of the Deputy Director of the 
Humanities and the Council, may make the following annual awards:
            (1) Jefferson lecture in the humanities award.--The 
        Director may award annually the Jefferson Lecture in the 
        Humanities Award to 1 individual for distinguished intellectual 
        achievement in the humanities. Each such award shall not exceed 
        $10,000.
            (2) Charles frankel prize.--The Director may award annually 
        the Charles Frankel Prize to honor individuals who have made 
        outstanding contributions to the public understanding of the 
        humanities. Not more than 5 individuals may receive such prize 
        each year. Each such prize shall not exceed $5,000.

SEC. 16. ARTS AND ARTIFACTS INDEMNITY.

    Section 2 of the Arts and Artifacts Indemnity Act (20 U.S.C. 971) 
is amended--
            (1) in subsection (a), by striking ``(a)'' and all that 
        follows through ``of 1965,'' and inserting ``The National 
        Council on Arts, Humanities, and Museum Services established 
        under section 10 of the National Endowment Restructuring Act of 
        1995 (referred to in this Act as the `Council'),''; and
            (2) by striking subsection (b).

SEC. 17. AUTHORIZATION OF APPROPRIATIONS.

    (a) Grants.--
            (1) In general.--There are authorized to be appropriated to 
        carry out section 7 $370,000,000 for each of fiscal years 1996 
        through 2000.
            (2) Administration.--Of the amount appropriated under 
        paragraph (1), the Director shall reserve not more than 9 
        percent to pay for the cost of administering this Act.
            (3) Reservations.--Of the amount appropriated under 
        paragraph (1), and remaining after the reservation required by 
        paragraph (2), for any fiscal year--
                    (A) the Director shall reserve 8 percent to provide 
                financial assistance under section 7(c); and
                    (B) of the amount remaining after the reservation 
                required by subparagraph (A), the Director shall 
                reserve--
                            (i) 20 percent to make grants under section 
                        7(a)(1)(A);
                            (ii) 20 percent to make grants under 
                        section 7(a)(1)(B);
                            (iii) 30 percent to make grants under 
                        section 7(b)(1)(A); and
                            (iv) 30 percent to make grants under 
                        section 7(b)(1)(B).
    (b) Sums Remaining Available.--Sums appropriated pursuant to 
subsection (a) for any fiscal year shall remain available for 
obligation until expended.
SEC. 18. TRANSFERS TO NATIONAL ENDOWMENT.

    (a) Definitions.--For purposes of this section, unless otherwise 
provided or indicated by the context--
            (1) the term ``covered officer'' means the Chairperson of 
        the National Endowment for the Arts, the Chairperson of the 
        National Endowment for the Humanities, the Director of the 
        Institute of Museum Services, and the Federal Council on the 
        Arts and the Humanities;
            (2) the term ``Federal agency'' has the meaning given to 
        the term ``agency'' by section 551(1) of title 5, United States 
        Code;
            (3) the term ``function'' means any duty, obligation, 
        power, authority, responsibility, right, privilege, activity, 
        or program; and
            (4) the term ``office'' includes any office, 
        administration, agency, institute, unit, organizational entity, 
        or component thereof.
    (b) Transfer of Functions.--There are transferred to the National 
Endowment, in accordance with subsection (c), all functions that a 
covered officer exercised before the effective date of this section 
(including all related functions of any officer or employee of the 
National Foundation on the Arts and the Humanities) that are minimally 
necessary to carry out the functions of the National Endowment. Except 
as otherwise provided in this Act, the authority of a transferred 
employee to carry out a function under the National Foundation on the 
Arts and the Humanities Act of 1965 (20 U.S.C. 951 et seq.) or the 
Museum Services Act (20 U.S.C. 961 et seq.) shall terminate on the 
effective date of this section.
    (c) Determinations of Functions.--If necessary, the Director shall 
make any determination of the functions that are transferred under 
subsection (b).
    (d) Personnel Provisions.--
            (1) Appointments.--The Director may appoint and fix the 
        compensation of such officers and employees, including 
        investigators, attorneys, and administrative law judges, as may 
        be necessary to carry out the functions of the National 
        Endowment. Except as otherwise provided by law, such officers 
        and employees shall be appointed in accordance with the civil 
        service laws and their compensation fixed in accordance with 
        title 5, United States Code.
            (2) Experts and consultants.--The Director may obtain the 
        services of experts and consultants in accordance with section 
        3109 of title 5, United States Code, and compensate such 
        experts and consultants for each day (including travel time) at 
        rates not in excess of the rate of pay for level IV of the 
        Executive Schedule under section 5315 of such title. The 
        Director may pay experts and consultants who are serving away 
        from their homes or regular place of business travel expenses 
        and per diem in lieu of subsistence at rates authorized by 
        sections 5702 and 5703 of such title for persons in Government 
        service employed intermittently.
    (e) Delegation and Assignment.--Except where otherwise expressly 
prohibited by law or otherwise provided by this section, the Director 
may delegate any function transferred or granted to such National 
Endowment after the effective date of this section to such officers and 
employees of the National Endowment as the Director may designate, and 
may authorize successive redelegations of such functions as may be 
necessary or appropriate. No delegation of functions by the Director 
under this subsection or under any other provision of this section 
shall relieve such Director of responsibility for the administration of 
such functions.
    (f) Reorganization.--The Director may allocate or reallocate any 
function transferred or granted to such National Endowment after the 
effective date of this section among the officers of the National 
Endowment, and establish, consolidate, alter, or discontinue such 
organizational entities in the National Endowment as may be necessary 
or appropriate.
    (g) Rules.--The Director is authorized to prescribe, in accordance 
with the provisions of chapters 5 and 6 of title 5, United States Code, 
such rules and regulations as the Director determines to be necessary 
or appropriate to administer and manage the functions of the National 
Endowment.
    (h) Transfer and Allocations of Appropriations and Personnel.--
Except as otherwise provided in this section, the personnel employed in 
connection with, and the assets, liabilities, contracts, property, 
records, and unexpended balances of appropriations, authorizations, 
allocations, and other funds employed, used, held, arising from, 
available to, or to be made available in connection with the functions 
transferred by this section, subject to section 1531 of title 31, 
United States Code, shall be transferred to the National Endowment. 
Unexpended funds transferred pursuant to this subsection shall be used 
only to carry out the functions of the National Endowment.
    (i) Incidental Transfers.--The Director of the Office of Management 
and Budget, at such time or times as the Director shall provide, may 
make such determinations as may be necessary with regard to the 
functions transferred by this section, and to make such additional 
incidental dispositions of personnel, assets, liabilities, grants, 
contracts, property, records, and unexpended balances of 
appropriations, authorizations, allocations, and other funds held, 
used, arising from, available to, or to be made available in connection 
with such functions, as may be necessary to carry out the provisions of 
this section. The Director of the Office of Management and Budget shall 
provide for the termination of the affairs of all entities terminated 
by this section and for such further measures and dispositions as may 
be necessary to effectuate the objectives of this section.
    (j) Effect on Personnel.--
            (1) Termination of certain positions.--Positions whose 
        incumbents are appointed by the President, by and with the 
        advice and consent of the Senate, the functions of which are 
        transferred by this section, shall terminate on the effective 
        date of this section.
            (2) Actions.--Each covered officer shall take such actions 
        as may be necessary, including reduction in force actions, 
        consistent with sections 3502 and 3595 of title 5, United 
        States Code, to ensure that the positions of personnel of the 
        National Foundation on the Arts and the Humanities that are not 
        transferred under subsection (b)(1) are separated from service.
    (k) Savings Provisions.--
            (1) Continuing effect of legal documents.--All orders, 
        determinations, rules, regulations, permits, agreements, 
        grants, contracts, certificates, licenses, registrations, 
        privileges, and other administrative actions--
                    (A) that have been issued, made, granted, or 
                allowed to become effective by the President, any 
                Federal agency or official of a Federal agency, or by a 
                court of competent jurisdiction, in the performance of 
                functions that are transferred under this section; and
                    (B) that were in effect before the effective date 
                of this section, or were final before the effective 
                date of this section and are to become effective on or 
                after the effective date of this section;
        shall continue in effect according to their terms until 
        modified, terminated, superseded, set aside, or revoked in 
        accordance with law by the President, the Director or other 
        authorized official, a court of competent jurisdiction, or by 
        operation of law, to the extent that such administrative 
        actions relate to the administration or enforcement of 
        financial assistance made available by the National Foundation 
        on the Arts and the Humanities before the effective date of 
        this section.
            (2) Proceedings not affected.--
                    (A) In general.--This section shall not affect any 
                proceedings, other than rulemaking, pending before the 
                National Foundation on the Arts and the Humanities on 
                the effective date of this section, with respect to 
                such financial assistance.
                    (B) Continuation.--Such proceedings shall be 
                continued. Orders shall be issued in such proceedings, 
                appeals shall be taken from the orders, and payments 
                shall be made pursuant to the orders, as if this 
                section had not been enacted, and orders issued in any 
                such proceedings shall continue in effect until 
                modified, terminated, superseded, or revoked by a duly 
                authorized official, by a court of competent 
                jurisdiction, or by operation of law.
                    (C) Construction.--Nothing in this paragraph shall 
                be construed to prohibit the discontinuance or 
                modification of any such proceeding under the same 
                terms and conditions and to the same extent that such 
                proceeding could have been discontinued or modified if 
                this section had not been enacted.
            (3) Suits not affected.--The provisions of this section 
        shall not affect suits commenced before the effective date of 
        this section, and in all such suits, proceedings shall be had, 
        appeals taken, and judgments rendered in the same manner and 
        with the same effect as if this section had not been enacted.
            (4) Nonabatement of actions.--No suit, action, or other 
        proceeding commenced by or against the National Foundation on 
        the Arts and the Humanities, or by or against any individual in 
        the official capacity of such individual as an officer of the 
        National Foundation on the Arts and the Humanities, shall abate 
        by reason of the enactment of this section.

SEC. 19. REPEALS AND TECHNICAL AND CONFORMING AMENDMENTS.

    (a) Repeals.--
            (1) National endowment on the arts and the humanities act 
        of 1965.--The National Foundation on the Arts and the 
        Humanities Act of 1965 (20 U.S.C. 951 et seq.) is repealed.
            (2) Museum services act.--The Museum Services Act (20 
        U.S.C. 961 et seq.) is repealed.
    (b) References to National Foundation on the Arts and the 
Humanities.--A reference in any other Federal law, Executive order, 
rule, regulation, or delegation of authority, or any document of or 
relating to the National Foundation on the Arts and the Humanities 
shall be deemed to refer to the National Endowment.
    (c) References to National Endowment for the Arts.--A reference in 
any other Federal law, Executive order, rule, regulation, or delegation 
of authority, or any document of or relating to--
            (1) the Chairperson or Chairman of the National Endowment 
        for the Arts shall be deemed to refer to the Deputy Director 
        for Arts; and
            (2) the National Endowment for the Arts shall be deemed to 
        refer to the National Endowment.
    (d) References to National Endowment for the Humanities.--A 
reference in any other Federal law, Executive order, rule, regulation, 
or delegation of authority, or any document of or relating to--
            (1) the Chairperson or Chairman of the National Endowment 
        for the Humanities shall be deemed to refer to the Deputy 
        Director for Humanities; and
            (2) the National Endowment for the Humanities shall be 
        deemed to refer to the National Endowment.
    (e) References to Institute of Museum Services.--A reference in any 
other Federal law, Executive order, rule, regulation, or delegation of 
authority, or any document of or relating to--
            (1) the Director of the Institute of Museum Services shall 
        be deemed to refer to the Deputy Director for Museum Services; 
        and
            (2) the Institute of Museum Services shall be deemed to 
        refer to the National Endowment.
    (f) References to Federal Council on the Arts and the Humanities, 
National Council on the Arts, National Council on the Humanities, or 
National Museum Services Board.--A reference in any other Federal law, 
Executive order, rule, regulation, or delegation of authority, or any 
document of or relating to the Federal Council on the Arts and the 
Humanities, National Council on the Arts, National Council on the 
Humanities, or National Museum Services Board shall be deemed to refer 
to the Council.
    (g) Inspector General Act of 1978.--Section 8G(a)(2) of the 
Inspector General Act of 1978 (5 U.S.C. App.) is amended by striking 
``the National Endowment for the Arts, the National Endowment for the 
Humanities,'' and inserting ``the National Endowment for Arts, 
Humanities, and Museum Services,''.
    (h) Executive Schedule Positions.--
            (1) Chairmen of endowments.--Section 5314 of title 5, 
        United States Code, is amended by striking the following:
            ``Chairman of the National Endowment for the Arts the 
        incumbent of which also serves as Chairman of the National 
        Council on the Arts.
            ``Chairman of the National Endowment for the Humanities.''.
            (2) Director of institute of museum services.--Section 5315 
        of title 5, United States Code, is amended by striking the 
        following:
            ``Director of the Institute of Museum Services.''.
    (i) Reference to National Foundation on the Arts and the Humanities 
Act of 1965.--Section 5(a)(6) of the American Folklife Preservation Act 
(20 U.S.C. 2104(a)(6)) is amended by striking ``and State'' and all 
that follows through ``such'' and inserting ``and appropriate State 
entities carrying out activities under the National Endowment 
Restructuring Act of 1995, such''.
    (j) Termination of Authority.--
            (1) Termination.--The National Foundation on the Arts and 
        the Humanities, the National Endowment for the Arts, the 
        National Endowment for the Humanities, the Institute of Museum 
        Services, the Federal Council on the Arts and the Humanities, 
        the National Council on the Arts, the National Council on the 
        Humanities, and the National Museum Services Board shall 
        terminate on the date of enactment of this Act.
            (2) Authority.--The authority granted to each entity 
        referred to in paragraph (1) by any reorganization plan or 
        other Federal law shall terminate on the date of enactment of 
        this Act.
    (k) Additional Conforming Amendments.--
            (1) Recommended legislation.--After consultation with the 
        appropriate committees of Congress and the Director of the 
        Office of Management and Budget, the Director shall prepare and 
        submit to Congress recommended legislation containing technical 
        and conforming amendments to reflect the changes made by this 
        Act.
            (2) Submission to congress.--Not later than 6 months after 
        the date of enactment of this Act, the Director shall submit 
        the recommended legislation referred to under paragraph (1) to 
        Congress.
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