[Congressional Bills 104th Congress]
[From the U.S. Government Publishing Office]
[S. 1533 Introduced in Senate (IS)]

  2d Session
                                S. 1533

To provide an opportunity for community renewal and economic growth in 
 empowerment zones and enterprise communities, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 26, 1996

  Mr. McCain introduced the following bill; which was read twice and 
                  referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
To provide an opportunity for community renewal and economic growth in 
 empowerment zones and enterprise communities, 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; TABLE OF CONTENTS; BUDGET EFFECT.

    (a) Short Title.--This Act may be cited as the ``Community Renewal 
and Economic Opportunity Act''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title; table of contents; budget effect.
                     TITLE I--ECONOMIC OPPORTUNITY

                       Subtitle A--Tax Incentives

Sec. 101. General tax credit for businesses in empowerment zones and 
                            enterprise communities.
Sec. 102. Election of flat tax option for zone and community 
                            businesses.
Sec. 103. Exclusion for capital gains on certain investments within 
                            zones and communities.
Sec. 104. Increase in expensing under section 179 for businesses in 
                            zones and communities.
Sec. 105. Tax-free dividends received from enterprise zone businesses.
Sec. 106. Work opportunity tax credit.
                Subtitle B--Contracting Set-Aside Reform

Sec. 111. Amendments to the Small Business Act.
Sec. 112. Technical and conforming amendments in other law.
Sec. 113. Savings provision.
Sec. 114. Additional technical and conforming amendments.
               Subtitle C--Small Business Mentor Program

Sec. 121. Establishment of mentor program.
                   TITLE II--COMMUNITY INFRASTRUCTURE

Sec. 201. Limitation on the application of the Davis-Bacon requirements 
                            to empowerment zones, enterprise 
                            communities, and enterprise zones.
Sec. 202. Reform of community development block grant program.
                        TITLE III--SAFE STREETS

                   Subtitle A--Mandatory Restitution

Sec. 301. Order of restitution.
Sec. 302. Conditions of probation.
Sec. 303. Mandatory restitution.
Sec. 304. Order of restitution to victims of other crimes.
Sec. 305. Procedure for issuance and enforcement of restitution order.
Sec. 306. Procedure.
Sec. 307. Instruction to Sentencing Commission.
Sec. 308. Justice Department regulations.
Sec. 309. Special assessments on convicted persons.
Sec. 310. Crime victims fund.
Sec. 311. Victims of terrorism act.
Sec. 312. Severability.
Sec. 313. Study and report.
Sec. 314. Effective date.
                Subtitle B--Asset Forfeiture Assistance

Sec. 321. Forfeitures under the Controlled Substances Act.
                   TITLE IV--EDUCATIONAL OPPORTUNITY

Sec. 401. Purpose.
Sec. 402. Definitions.
Sec. 403. Funding.
Sec. 404. Program authorized.
Sec. 405. Authorized projects.
Sec. 406. Applications.
Sec. 407. Education certificates.
Sec. 408. Effect on other programs; use of school lunch data.
Sec. 409. Parental notification.
Sec. 410. Evaluation and report.
                      TITLE V--FAMILY OPPORTUNITY

Sec. 501. Findings and purpose.
Sec. 502. Removal of barriers to interracial and interethnic adoptions.
Sec. 503. Repeal.
Sec. 504. Effective date.
                     TITLE VI--VOLUNTEER PROTECTION

Sec. 601. Findings and purpose.
Sec. 602. Definitions.
Sec. 603. No preemption of State tort law.
Sec. 604. Limitation on liability for volunteers.
Sec. 605. Certification requirement and adjustment of social services 
                            block grant allotments.
                      TITLE VII--SPECTRUM AUCTION

Sec. 701. Auction of electromagnetic spectrum.
    (c) Sense of the Senate Regarding Budget Neutrality.--It is the 
sense of the Senate that appropriate reductions in Federal budget 
spending levels should be made in order to enact in a budget neutral 
manner the provisions of, and amendments made by, this Act.

                     TITLE I--ECONOMIC OPPORTUNITY

                       Subtitle A--Tax Incentives

SEC. 101. GENERAL TAX CREDIT FOR BUSINESSES IN EMPOWERMENT ZONES AND 
              ENTERPRISE COMMUNITIES.

    (a) In General.--Part II of subchapter U of chapter 1 of the 
Internal Revenue Code of 1986 (relating to designation and treatment of 
empowerment zones, enterprise communities, and rural development 
investment areas) is amended by adding at the end the following new 
section:

``SEC. 1395. GENERAL TAX CREDIT.

    ``(a) In General.--In the case of an enterprise zone business, 
there shall be allowed as a credit against the tax imposed by this 
chapter for the taxable year an amount equal to 10 percent of such tax 
(determined without regard to this section).
    ``(b) Enterprise Zone Business.--For purposes of this section, the 
term `enterprise zone business' has the meaning given to such term by 
section 1394(b)(3), except that in the case of empowerment zones, 
subsections (b)(6) and (c)(5) of section 1397B shall be applied by 
substituting `50 percent' for `35 percent'.
    ``(c) Designation of Additional Enterprise Communities for Tax 
Credit and Flat Tax Option.--For purposes of the credit allowed under 
this section and the flat tax option under section 1395A only, and 
notwithstanding subsections (b)(1) and (c) of section 1391(b)(1), the 
Secretary of Housing and Urban Development may designate 90 additional 
enterprise communities in urban areas under section 1391.''.
    (b) Conforming Amendments.--
            (1) Part II of subchapter U of chapter 1 of the Internal 
        Revenue Code of 1986 is amended to read as follows:

      ``PART II--INCENTIVES FOR EMPOWERMENT ZONES AND ENTERPRISE 
                            COMMUNITIES.''.

            (2) The table of parts of subchapter U of chapter 1 of such 
        Code is amended to read as follows:

                              ``Part II. Incentives for empowerment 
                                        zones and enterprise 
                                        communities.''.
            (3) The table of sections of part II of subchapter U of 
        chapter 1 of such Code is amended by adding at the end the 
        following new item:

                              ``Sec. 1395. General tax credit.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1996.

SEC. 102. ELECTION OF FLAT TAX OPTION FOR ZONE AND COMMUNITY 
              BUSINESSES.

    (a) In General.--Part II of subchapter U of chapter 1 of the 
Internal Revenue Code of 1986, as amended by section 101, is amended by 
adding at the end the following new section:

``SEC. 1395A. FLAT TAX OPTION.

    ``(a) In General.--An enterprise zone business may elect for any 
taxable year the flat tax option.
    ``(b) Flat Tax Option.--For purposes of this section, the term 
`flat tax option' means, with respect to any taxable year--
            ``(1) no credit otherwise allowable to the taxpayer under 
        this subchapter or part IV of subchapter A shall be allowed,
            ``(2) part VI of subchapter A (relating to the alternative 
        minimum tax) shall not apply to the taxpayer, and
            ``(3) section 11 shall apply to the taxpayer as if amended 
        to read as follows:

```SEC. 11. TAX IMPOSED ON BUSINESS ACTIVITIES.

    ```(a) Tax Imposed.--There is hereby imposed on every person 
engaged in a business activity a tax equal to 10 percent of the 
business taxable income of such person.
    ```(b) Liability for Tax.--The tax imposed by this section shall be 
paid by the person engaged in the business activity, whether such 
person is an individual, partnership, corporation, or otherwise.
    ```(c) Business Taxable Income.--For purposes of this section--
            ```(1) In general.--The term ``business taxable income'' 
        means gross active income reduced by the deductions specified 
        in subsection (d).
            ```(2) Gross active income.--
                    ```(A) In general.--For purposes of paragraph (1), 
                the term ``gross active income'' means gross receipts 
                from--
                            ```(i) the sale or exchange of property or 
                        services in the United States by any person in 
                        connection with a business activity, and
                            ```(ii) the export of property or services 
                        from the United States in connection with a 
                        business activity.
                    ```(B) Exchanges.--For purposes of this section, 
                the amount treated as gross receipts from the exchange 
                of property or services is the fair market value of the 
                property or services received, plus any money received.
                    ```(C) Coordination with special rules for 
                financial services, etc.--Except as provided in 
                subsection (e)--
                            ```(i) the term ``property'' does not 
                        include money or any financial instrument, and
                            ```(ii) the term ``services'' does not 
                        include financial services.
            ```(3) Exemption from tax for activities of governmental 
        entities and tax-exempt organizations.--For purposes of this 
        section, the term ``business activity'' does not include any 
        activity of a governmental entity or of any other organization 
        which is exempt from tax under this chapter.
    ```(d) Deductions.--
            ```(1) In general.--The deductions specified in this 
        subsection are--
                    ```(A) the cost of business inputs for the business 
                activity,
                    ```(B) wages (as defined in section 3121(a) without 
                regard to paragraph (1) thereof) which are paid in cash 
                for services performed in the United States as an 
                employee, and
                    ```(C) retirement contributions to or under any 
                plan or arrangement which makes retirement 
                distributions (as defined in section 63(c)) for the 
                benefit of such employees to the extent such 
                contributions are allowed as a deduction under section 
                404.
            ```(2) Business inputs.--
                    ```(A) In general.--For purposes of paragraph (1), 
                the term ``cost of business inputs'' means--
                            ```(i) the amount paid for property sold or 
                        used in connection with a business activity,
                            ```(ii) the amount paid for services (other 
                        than for the services of employees, including 
                        fringe benefits paid by reason of such 
                        services) in connection with a business 
                        activity, and
                            ```(iii) any excise tax, sales tax, customs 
                        duty, or other separately stated levy imposed 
                        by a Federal, State, or local government on the 
                        purchase of property or services which are for 
                        use in connection with a business activity.
                Such term shall not include any tax imposed by chapter 
                2 or 21.
                    ```(B) Exceptions.--Such term shall not include--
                            ```(i) items described in subparagraphs (B) 
                        and (C) of paragraph (1), and
                            ```(ii) items for personal use not in 
                        connection with any business activity.
                    ```(C) Exchanges.--For purposes of this section, 
                the amount treated as paid in connection with the 
                exchange of property or services is the fair market 
                value of the property or services exchanged, plus any 
                money paid.
    ```(e) Special Rules for Financial Intermediation Service 
Activities.--In the case of the business activity of providing 
financial intermediation services, the taxable income from such 
activity shall be equal to the value of the intermediation services 
provided in such activity.
    ```(f) Exception for Services Performed as Employee.--For purposes 
of this section, the term ``business activity'' does not include the 
performance of services by an employee for the employee's employer.
    ```(g) Carryover of Excess Deductions.--
            ```(1) In general.--If the aggregate deductions for any 
        taxable year exceed the gross active income for such taxable 
        year, the amount of the deductions specified in subsection (d) 
        for the succeeding taxable year (determined without regard to 
        this subsection) shall be increased by the sum of--
                    ```(A) such excess, plus
                    ```(B) the product of such excess and the 3-month 
                Treasury rate for the last month of such taxable year.
            ```(2) 3-month treasury rate.--For purposes of paragraph 
        (1), the 3-month Treasury rate is the rate determined by the 
        Secretary based on the average market yield (during any 1-month 
        period selected by the Secretary and ending in the calendar 
        month in which the determination is made) on outstanding 
        marketable obligations of the United States with remaining 
        periods to maturity of 3 months or less.'
    ``(c) Enterprise Zone Business.--For purposes of this section, the 
term `enterprise zone business' has the meaning given to such term by 
section 1394(b)(3), except that subsections (b)(6) and (c)(5) of 
section 1397B shall be applied by substituting `50 percent' for `35 
percent'.''.
    (b) Conforming Amendment.--The table of sections of part II of 
subchapter U of chapter 1 of such Code, as amended by section 101, is 
amended by adding at the end the following new item:

                              ``Sec. 1395A. Flat tax option.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1996.

SEC. 103. EXCLUSION FOR CAPITAL GAINS ON CERTAIN INVESTMENTS WITHIN 
              ZONES AND COMMUNITIES.

    (a) In General.--Part II of subchapter U of chapter 1 of the 
Internal Revenue Code of 1986, as amended by sections 101 and 102, is 
amended by adding at the end the following new section:

``SEC. 1395B. EXCLUSION FOR GAIN FROM ZONE OR COMMUNITY INVESTMENTS.

    ``(a) General Rule.--In the case of an individual, gross income 
shall not include any qualified capital gain recognized on the sale or 
exchange of a qualified zone asset held for more than 5 years.
    ``(b) Qualified Zone Asset.--For purposes of this section--
            ``(1) In general.--The term `qualified zone asset' means--
                    ``(A) any qualified zone stock,
                    ``(B) any qualified zone property, and
                    ``(C) any qualified zone partnership interest.
            ``(2) Qualified zone stock.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), the term `qualified zone stock' means 
                any stock in a domestic corporation if--
                            ``(i) such stock is acquired by the 
                        taxpayer on original issue from the corporation 
                        solely in exchange for cash,
                            ``(ii) as of the time such stock was 
                        issued, such corporation was an enterprise zone 
                        business (or, in the case of a new corporation, 
                        such corporation was being organized for 
                        purposes of being an enterprise zone business), 
                        and
                            ``(iii) during substantially all of the 
                        taxpayer's holding period for such stock, such 
                        corporation qualified as an enterprise zone 
                        business.
                    ``(B) Redemptions.--The term `qualified zone stock' 
                shall not include any stock acquired from a corporation 
                which made a substantial stock redemption or 
                distribution (without a bona fide business purpose 
                therefor) in an attempt to avoid the purposes of this 
                section.
            ``(3) Qualified zone property.--
                    ``(A) In general.--The term `qualified zone 
                property' has the meaning given to such term by section 
                1397C, except that references to empowerment zones 
                shall be treated as including references to enterprise 
                communities.
            ``(4) Qualified zone partnership interest.--The term 
        `qualified zone partnership interest' means any interest in a 
        partnership if--
                    ``(A) such interest is acquired by the taxpayer 
                from the partnership solely in exchange for cash,
                    ``(B) as of the time such interest was acquired, 
                such partnership was an enterprise zone business (or, 
                in the case of a new partnership, such partnership was 
                being organized for purposes of being an enterprise 
                zone business), and
                    ``(C) during substantially all of the taxpayer's 
                holding period for such interest, such partnership 
                qualified as an enterprise zone business.
        A rule similar to the rule of paragraph (2)(B) shall apply for 
        purposes of this paragraph.
            ``(5) Treatment of subsequent purchasers.--The term 
        `qualified zone asset' includes any property which would be a 
        qualified zone asset but for paragraph (2)(A)(i), section 
        1397(a)(1)(B), or paragraph (4)(A) in the hands of the taxpayer 
        if such property was a qualified zone asset in the hands of any 
        prior holder.
            ``(6) 10-year safe harbor.--If any property ceases to be a 
        qualified zone asset by reason of paragraph (2)(A)(iii), 
        section 1397(a)(1)(C), or paragraph (4)(C) after the 10-year 
        period beginning on the date the taxpayer acquired such 
        property, such property shall continue to be treated as meeting 
        the requirements of such paragraph; except that the amount of 
        gain to which subsection (a) applies on any sale or exchange of 
        such property shall not exceed the amount which would be 
        qualified capital gain had such property been sold on the date 
        of such cessation.
            ``(7) Treatment of zone or community terminations.--The 
        termination of any designation of an area as an empowerment 
        zone or enterprise community shall be disregarded for purposes 
        of determining whether any property is a qualified zone asset.
    ``(c) Other Definitions and Special Rules.--For purposes of this 
section--
            ``(1) Enterprise zone business.--For purposes of this 
        section, the term `enterprise zone business' has the meaning 
        given to such term by section 1394(b)(3).''.
            ``(2) Qualified capital gain.--Except as otherwise provided 
        in this subsection, the term `qualified capital gain' means any 
        long-term capital gain.
            ``(3) Certain gain on real property not qualified.--The 
        term `qualified capital gain' shall not include any gain which 
        would be treated as ordinary income under section 1250 if 
        section 1250 applied to all depreciation rather than the 
        additional depreciation.
            ``(4) Gain attributable to periods after termination of 
        zone or community designation not qualified.--The term 
        `qualified capital gain' shall not include any gain 
        attributable to periods after the termination of any 
        designation of an area as an empowerment zone or enterprise 
        community.
    ``(d) Treatment of Pass-Thru Entities.--
            ``(1) Sales and exchanges.--Gain on the sale or exchange of 
        an interest in a pass-thru entity held by the taxpayer (other 
        than an interest in an entity which was an enterprise zone 
        business during substantially all of the period the taxpayer 
        held such interest) for more than 5 years shall be treated as 
        gain described in subsection (a) to the extent such gain is 
        attributable to amounts which would be qualified capital gain 
        on qualified zone assets (determined as if such assets had been 
        sold on the date of the sale or exchange) held by such entity 
        for more than 5 years and throughout the period the taxpayer 
        held such interest. A rule similar to the rule of paragraph 
        (2)(B) shall apply for purposes of the preceding sentence.
            ``(2) Distributions.--
                    ``(A) In general.--Any amount included in income by 
                reason of holding an interest in a pass-thru entity 
                (other than an entity which was an enterprise zone 
                business during substantially all of the period the 
                taxpayer held the interest to which such inclusion 
                relates) shall be treated as gain described in 
                subsection (a) if such amount meets the requirements of 
                subparagraph (B).
                    ``(B) Requirements.--An amount meets the 
                requirements of this subparagraph if--
                            ``(i) such amount is attributable to gain 
                        on the sale or exchange by the pass-thru entity 
                        of property which is a qualified zone asset in 
                        the hands of such entity and which was held by 
                        such entity for the period required under 
                        subsection (a), and
                            ``(ii) such amount is includible in the 
                        gross income of the taxpayer by reason of the 
                        holding of an interest in such entity which was 
                        held by the taxpayer on the date on which such 
                        pass-thru entity acquired such asset and at all 
                        times thereafter before the disposition of such 
                        asset by such pass-thru entity.
                    ``(C) Limitation based on interest originally held 
                by taxpayer.--Subparagraph (A) shall not apply to any 
                amount to the extent such amount exceeds the amount to 
                which subparagraph (A) would have applied if such 
                amount were determined by reference to the interest the 
                taxpayer held in the pass-thru entity on the date the 
                qualified zone asset was acquired.
            ``(3) Pass-thru entity.--For purposes of this subsection, 
        the term `pass-thru entity' means--
                    ``(A) any partnership,
                    ``(B) any S corporation,
                    ``(C) any regulated investment company, and
                    ``(D) any common trust fund.
    ``(e) Sales and Exchanges of Interests in Partnerships and S 
Corporations Which are Qualified Zone Businesses.--In the case of the 
sale or exchange of an interest in a partnership, or of stock in an S 
Corporation, which was an enterprise zone business during substantially 
all of the period the taxpayer held such interest or stock) is an 
enterprise zone business, the amount of qualified capital gain shall be 
determined without regard to--
            ``(1) any intangible, and any land, which is not an 
        integral part of any qualified business (as defined in section 
        1397B(d)), and
            ``(2) gain attributable to periods before the designation 
        of an area as an empowerment zone or enterprise community.
    ``(f) Certain Tax-Free and Other Transfers.--For purposes of this 
section--
            ``(1) In general.--In the case of a transfer of a qualified 
        zone asset to which this subsection applies, the transferee 
        shall be treated as--
                    ``(A) having acquired such asset in the same manner 
                as the transferor, and
                    ``(B) having held such asset during any continuous 
                period immediately preceding the transfer during which 
                it was held (or treated as held under this subsection) 
                by the transferor.
            ``(2) Transfers to which subsection applies.--This 
        subsection shall apply to any transfer--
                    ``(A) by gift,
                    ``(B) at death, or
                    ``(C) from a partnership to a partner thereof of a 
                qualified zone asset with respect to which the 
                requirements of subsection (d)(2) are met at the time 
                of the transfer (without regard to the 5-year holding 
                requirement).
            ``(3) Certain rules made applicable.--Rules similar to the 
        rules of section 1244(d)(2) shall apply for purposes of this 
        section.''.
    (b) Conforming Amendments.--
            (1) Section 172(d)(2)(B) of the Internal Revenue Code of 
        1986 (relating to modifications with respect to net operating 
        loss deduction) is amended by striking ``section 1202'' and 
        inserting ``sections 1202 and 1395B''.
            (2) Paragraph (4) of section 642(c) of such Code (relating 
        to adjustments) is amended by inserting ``or 1395B(a)'' after 
        ``section 1202(a)'' and by inserting ``or 1395B'' after 
        ``section 1202''.
            (3) Paragraph (3) of section 643(a) of such Code (defining 
        distributable net income) is amended by striking ``section 
        1202'' and inserting ``sections 1202 and 1395B''.
            (4) Paragraph (4) of section 691(c) of such Code (relating 
        to coordination with capital gain provisions) is amended by 
        striking ``1202, and 1211'' and inserting ``1202, 1395B, and 
        1211''.
            (5) The second sentence of paragraph (2) of section 871(a) 
        of such Code (relating to capital gains of aliens present in 
        the United States 183 days or more) is amended by inserting 
        ``or 1395B'' after ``section 1202''.
            (6) The table of sections of part II of subchapter U of 
        chapter 1 of such Code, as amended by sections 101 and 102, is 
        amended by adding at the end the following new item:

                              ``Sec. 1395B. Exclusion for gain from 
                                        zone or community 
                                        investments.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1996.

SEC. 104. INCREASE IN EXPENSING UNDER SECTION 179 FOR BUSINESSES IN 
              ZONES AND COMMUNITIES.

    (a) In General.--Part II of subchapter U of chapter 1 of the 
Internal Revenue Code of 1986, as amended by sections 101, 102, and 
103, is amended by adding at the end the following new section:

``SEC. 1395C. INCREASE IN EXPENSING UNDER SECTION 179.

    ``(a) General Rule.--In the case of an enterprise zone business, 
for purposes of section 179--
            ``(1) the limitation under section 179(b)(1) shall be 
        increased by the lesser of--
                    ``(A) $35,000, or
                    ``(B) the cost of section 179 property which is 
                qualified zone property placed in service during the 
                taxable year, and
            ``(2) the amount taken into account under section 179(b)(2) 
        with respect to any section 179 property which is qualified 
        zone property shall be 50 percent of the cost thereof.
    ``(b) Recapture.--Rules similar to the rules under section 
179(d)(10) shall apply with respect to any qualified zone property 
which ceases to be used in an empowerment zone or enterprise community 
by an enterprise zone business.
    ``(c) Enterprise Zone Business.--For purposes of this section, the 
term `enterprise zone business' has the meaning given to such term by 
section 1394(b)(3).''.
    (b) Conforming Amendments.--
            (1) The table of sections of part II of subchapter U of 
        chapter 1 of the Internal Revenue Code of 1986, as amended by 
        sections 101, 102, and 103, is amended by adding at the end the 
        following new item:

                              ``Sec. 1395C. Increase in expensing under 
                                        section 179.''.
            (2) Part III of subchapter U of chapter 1 of such Code is 
        amended by striking subpart B and by redesignating subpart C as 
        subpart B.
            (3) The table of subparts of part III of such subchapter is 
        amended by striking the item relating to subpart B and by 
        redesignating the item relating to subpart C as subpart B.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1996.

SEC. 105. TAX-FREE DIVIDENDS RECEIVED FROM ENTERPRISE ZONE BUSINESSES.

    (a) Corporations.--Section 243(a) of the Internal Revenue Code of 
1986 (relating to dividends received by corporations) is amended--
            (1) by striking ``and'' at the end of paragraph (2),
            (2) by striking the period at the end of paragraph (3) and 
        inserting ``; and'', and
            (3) by adding at the end the following new paragraph:
            ``(4) 100 percent in the case of dividends received from an 
        enterprise zone business.''.
    (b) Taxpayers Other Than Corporations.--
            (1) In general.--Part III of subchapter B of chapter 1 of 
        the Internal Revenue Code of 1986 (relating to items 
        specifically excluded for gross income) is amended by 
        redesignating section 137 as section 138 and by inserting after 
        section 136 the following new section:

``SEC. 137. EXCLUSION OF CERTAIN DIVIDENDS RECEIVED BY INDIVIDUALS.

    ``(a) Exclusion From Gross Income.--Gross income does not include 
amounts received by an individual as dividends from enterprise zone 
businesses.
    ``(b) Certain Dividends Excluded.--Subsection (a) shall not apply 
to any dividend from--
            ``(1) a corporation which, for the taxable year of the 
        corporation in which the distribution is made, or for the next 
        preceding taxable year of the corporation, is a corporation 
        exempt from tax under section 501 (relating to certain 
        charitable, etc., organizations) or section 521 (relating to 
        farmers' cooperative associations); or
            ``(2) a real estate investment trust which, for the taxable 
        year of the trust in which the dividend is paid, qualifies 
        under part II of subchapter M (sec. 856 and following).
    ``(c) Special Rules For Certain Distributions.--For purposes of 
subsection (a)--
            ``(1) Any amount allowed as a deduction under section 591 
        (relating to deduction for dividends paid by mutual savings 
        banks, etc.) shall not be treated as a dividend.
            ``(2) A dividend received from a regulated investment 
        company shall be subject to the limitations prescribed in 
        section 854.
            ``(3) The amount of dividends properly allocable to a 
        beneficiary under section 652 or 662 shall be deemed to have 
        been received by the beneficiary ratably on the same date that 
        the dividends were received by the estate or trust.''.
            (2) Conforming amendment.--The table of sections for such 
        part III is amended by striking the item relating to section 
        137 and inserting the following new items:

                              ``Sec. 137. Exclusion of certain 
                                        dividends received by 
                                        individuals.
                              ``Sec. 138. Cross reference to other 
                                        Acts.''.
    (c) Effective Date.--The amendments made by this section shall 
apply to taxable years beginning after December 31, 1996.

SEC. 106. WORK OPPORTUNITY TAX CREDIT.

    (a) Amount of Credit.--Subsection (a) of section 51 of the Internal 
Revenue Code of 1986 (relating to amount of credit) is amended by 
striking ``40 percent'' and inserting ``35 percent''.
    (b) Qualified Wages.--Paragraph (3) of section 51(b) of the 
Internal Revenue Code of 1986 (defining qualified wages) is amended by 
striking ``$6,000'' both places it appears and inserting ``$12,000''.
    (c) Members of Targeted Groups.--Subsection (d) of section 51 of 
the Internal Revenue Code of 1986 is amended to read as follows:
    ``(d) Members of Targeted Groups.--For purposes of this subpart--
            ``(1) In general.--An individual is a member of a targeted 
        group if such individual is--
                    ``(A) a qualified IV-A recipient,
                    ``(B) a qualified veteran,
                    ``(C) a high-risk youth,
                    ``(D) a vocational rehabilitation referral, or
                    ``(E) a qualified summer youth employee.
            ``(2) Qualified iv-a recipient.--
                    ``(A) In general.--The term `qualified IV-A 
                recipient' means any individual who is certified by the 
                designated local agency as being a member of a family 
                receiving assistance under a IV-A program for at least 
                a 9-month period ending during the 9-month period 
ending on the hiring date.
                    ``(B) IV-A program.--For purposes of this 
                paragraph, the term `IV-A program' means any program 
                providing assistance under a State plan approved under 
                part A of title IV of the Social Security Act (relating 
                to assistance for needy families with minor children) 
                and any successor of such program.
            ``(3) Qualified veteran.--
                    ``(A) In general.--The term `qualified veteran' 
                means any veteran who is certified by the designated 
                local agency as being--
                            ``(i) a member of a family receiving 
                        assistance under a IV-A program (as defined in 
                        paragraph (2)(B)) for at least a 9-month period 
                        ending during the 12-month period ending on the 
                        hiring date, or
                            ``(ii) a member of a family receiving 
                        assistance under a food stamp program under the 
                        Food Stamp Act of 1977 for at least a 3-month 
                        period ending during the 12-month period ending 
                        on the hiring date.
                    ``(B) Veteran.--For purposes of subparagraph (A), 
                the term `veteran' means any individual who is 
                certified by the designated local agency as--
                            ``(i)(I) having served on active duty 
                        (other than active duty for training) in the 
                        Armed Forces of the United States for a period 
                        of more than 180 days, or
                            ``(II) having been discharged or released 
                        from active duty in the Armed Forces of the 
                        United States for a service-connected 
                        disability, and
                            ``(ii) not having any day during the 60-day 
                        period ending on the hiring date which was a 
                        day of extended active duty in the Armed Forces 
                        of the United States.
                For purposes of clause (ii), the term `extended active 
                duty' means a period of more than 90 days during which 
                the individual was on active duty (other than active 
                duty for training).
            ``(4) High-risk youth.--
                    ``(A) In general.--The term `high-risk youth' means 
                any individual who is certified by the designated local 
                agency--
                            ``(i) as having attained age 18 but not age 
                        25 on the hiring date, and
                            ``(ii) as having his principal place of 
                        abode within an empowerment zone or enterprise 
                        community.
                    ``(B) Youth must continue to reside in zone.--In 
                the case of a high-risk youth, the term `qualified 
                wages' shall not include wages paid or incurred for 
                services performed while such youth's principal place 
                of abode is outside an empowerment zone or enterprise 
                community.
            ``(5) Vocational rehabilitation referral.--The term 
        `vocational rehabilitation referral' means any individual who 
        is certified by the designated local agency as--
                    ``(A) having a physical or mental disability which, 
                for such individual, constitutes or results in a 
                substantial handicap to employment, and
                    ``(B) having been referred to the employer upon 
                completion of (or while receiving) rehabilitative 
                services pursuant to--
                            ``(i) an individualized written 
                        rehabilitation plan under a State plan for 
                        vocational rehabilitation services approved 
                        under the Rehabilitation Act of 1973, or
                            ``(ii) a program of vocational 
                        rehabilitation carried out under chapter 31 of 
                        title 38, United States Code.
            ``(6) Qualified summer youth employee.--
                    ``(A) In general.--The term `qualified summer youth 
                employee' means any individual--
                            ``(i) who performs services for the 
                        employer between May 1 and September 15,
                            ``(ii) who is certified by the designated 
                        local agency as having attained age 16 but not 
                        18 on the hiring date (or if later, on May 1 of 
                        the calendar year involved),
                            ``(iii) who has not been an employee of the 
                        employer during any period prior to the 90-day 
                        period described in subparagraph (B)(i), and
                            ``(iv) who is certified by the designated 
                        local agency as having his principal place of 
                        abode within an empowerment zone or enterprise 
                        community.
                    ``(B) Special rules for determining amount of 
                credit.--For purposes of applying this subpart to wages 
                paid or incurred to any qualified summer youth 
                employee--
                            ``(i) subsection (b)(2) shall be applied by 
                        substituting `any 90-day period between May 1 
                        and September 15' for `the 1-year period 
                        beginning with the day the individual begins 
                        work for the employer', and
                            ``(ii) subsection (b)(3) shall be applied 
                        by substituting `$3,000' for `$6,000'.
                The preceding sentence shall not apply to an individual 
                who, with respect to the same employer, is certified as 
                a member of another targeted group after such 
                individual has been a qualified summer youth employee.
                    ``(C) Youth must continue to reside in zone.--
                Paragraph (4)(B) shall apply for purposes of this 
                paragraph.
            ``(7) Hiring date.--The term `hiring date' means the day 
        the individual is hired by the employer.
            ``(8) Designated local agency.--The term `designated local 
        agency' means a State employment security agency established in 
        accordance with the Act of June 6, 1933, as amended (29 U.S.C. 
        49-49n).
            ``(9) Special rules for certifications.--
                    ``(A) In general.--An individual shall not be 
                treated as a member of a targeted group unless--
                            ``(i) on or before the day on which such 
                        individual begins work for the employer, the 
                        employer has received a certification from a 
                        designated local agency that such individual is 
                        a member of a targeted group, or
                            ``(ii)(I) on or before the day the 
                        individual is offered employment with the 
                        employer, a pre-screening notice is completed 
                        by the employer with respect to such 
                        individual, and
                            ``(II) not later than the 14th day after 
                        the individual begins work for the employer, 
                        the employer submits such notice, signed by the 
                        employer and the individual under penalties of 
                        perjury, to the designated local agency as part 
                        of a written request for such a certification 
                        from such agency.
                For purposes of this paragraph, the term `pre-screening 
                notice' means a document (in such form as the Secretary 
                shall prescribe) which contains information provided by 
                the individual on the basis of which the employer 
                believes that the individual is a member of a targeted 
                group.
                    ``(B) Incorrect certifications.--If--
                            ``(i) an individual has been certified by a 
                        designated local agency as a member of a 
                        targeted group, and
                            ``(ii) such certification is incorrect 
                        because it was based on false information 
                        provided by such individual,
                the certification shall be revoked and wages paid by 
                the employer after the date on which notice of 
                revocation is received by the employer shall not be 
                treated as qualified wages.
                    ``(C) Explanation of denial of request.--If a 
                designated local agency denies a request for 
                certification of membership in a targeted group, such 
                agency shall provide to the person making such request 
                a written explanation of the reasons for such 
                denial.''.
    (d) Minimum Employment Period.--Paragraph (3) of section 51(i) of 
the Internal Revenue Code of 1986 (relating to certain individuals 
ineligible) is amended to read as follows:
            ``(3) Individuals not meeting minimum employment period.--
        No wages shall be taken into account under subsection (a) with 
        respect to any individual unless such individual either--
                    ``(A) is employed by the employer at least 180 days 
                (20 days in the case of a qualified summer youth 
                employee), or
                    ``(B) has completed at least 500 hours (120 hours 
                in the case of a qualified summer youth employee) of 
                services performed for the employer.''.
    (e) Termination.--Paragraph (4) of section 51(c) of the Internal 
Revenue Code of 1986 (relating to wages defined) is amended to read as 
follows:
            ``(4) Termination.--The term `wages' shall not include any 
        amount paid or incurred to an individual who begins work for 
        the employer--
                    ``(A) after December 31, 1994, and before January 
                1, 1996, or
                    ``(B) after December 31, 1996.''.
    (f) Redesignation of Credit.--
            (1) Sections 38(b)(2) and 51(a) of the Internal Revenue 
        Code of 1986 are each amended by striking ``targeted jobs 
        credit'' and inserting ``work opportunity credit''.
            (2) The subpart heading for subpart F of part IV of 
        subchapter A of chapter 1 of such Code is amended by striking 
        ``Targeted Jobs Credit'' and inserting ``Work Opportunity 
        Credit''.
            (3) The table of subparts for such part IV is amended by 
        striking ``targeted jobs credit'' and inserting ``work 
        opportunity credit''.
            (4) The heading for paragraph (3) of section 1396(c) of 
        such Code is amended by striking ``targeted jobs credit'' and 
        inserting ``work opportunity credit''.
    (f) Technical Amendments.--
            (1) Paragraph (1) of section 51(c) of the Internal Revenue 
        Code of 1986 is amended by striking ``, subsection 
        (d)(8)(D),''.
            (2) Paragraph (3) of section 51(i) of such Code is amended 
        by striking ``(d)(12)'' each place it appears and inserting 
        ``(d)(6)''.
    (g) Effective Date.--The amendments made by this section shall 
apply to individuals who begin work for the employer after December 31, 
1996.

                Subtitle B--Contracting Set-Aside Reform

SEC. 111. AMENDMENTS TO THE SMALL BUSINESS ACT.

    (a) Findings and Purposes.--Section 2 of the Small Business Act (15 
U.S.C. 631) is amended--
            (1) by striking subsection (f);
            (2) by redesignating subsections (g) through (i) as 
        subsections (f) through (h), respectively; and
            (3) in subsection (g)(1)(H), as redesignated, by striking 
        ``socially and''.
    (b) Definitions.--Section 3 of the Small Business Act (15 U.S.C. 
632) is amended by adding at the end the following new subsection:
    ``(o) Economically Disadvantaged.--For purposes of this Act, the 
terms `economically disadvantaged small business concern' and 
`economically disadvantaged individual' have the same meanings as in 
section 8(a).''.
    (c) Administration of Programs.--Section 4(b)(1) of the Small 
Business Act (15 U.S.C. 633(b)(1)) is amended by striking the sixth 
sentence.
    (d) Guaranteed Loan Program.--Section 7(a)(20)(A) of the Small 
Business Act (15 U.S.C. 636(a)(20)(A)) is amended by striking 
``subsection (j)(10) and''.
    (e) Financial Assistance for Projects Providing Technical or 
Management Assistance.--Section 7(j) of the Small Business Act (15 
U.S.C. 636(j)) is amended--
            (1) in paragraph (1), by striking ``sections 7(i), 
        7(j)(10), and'' and inserting ``subsection (i) of this section 
        and section'';
            (2) in paragraph (2)(C), by striking ``sections 7(i), 
        7(j)(10), and'' and inserting ``subsection (i) of this section 
        and section'';
            (3) by striking paragraph (4) and inserting the following:
            ``(4) Preference.--In carrying out this subsection, the 
        Administrator shall give preference to projects that promote 
        the training and hiring by small business concerns of 
        economically disadvantaged individuals.'';
            (4) by striking paragraph (10);
            (5) by redesignating paragraph (11) as paragraph (8) and 
        inserting it immediately after paragraph (7);
            (6) in paragraph (8), as redesignated--
                    (A) in subparagraph (A)--
                            (i) by striking ``(A)''; and
                            (ii) by striking ``and small business 
                        concerns'' and all that follows before the 
                        period; and
                    (B) by striking subparagraphs (B) through (I); and
            (7) by striking paragraphs (12) through (16).
    (f) Procurement Contracts.--Section 8(a) of the Small Business Act 
(15 U.S.C. 637(a)) is amended--
            (1) in paragraph (1)--
                    (A) in subparagraph (B), by striking ``socially 
                and'';
                    (B) in subparagraph (C)--
                            (i) by moving the margins 2 ems to the 
                        left; and
                            (ii) by striking ``a small business concern 
                        owned and controlled by socially and 
                        economically disadvantaged individuals'' and 
                        inserting ``an economically disadvantaged small 
                        business concern''; and
                    (C) in subparagraph (D)(ii), by striking 
                ``Associate Administrator for Minority Small Business 
                and Capital Ownership Development'' and inserting 
                ``Administrator'';
            (2) by striking paragraphs (4) through (6) and inserting 
        the following:
    ``(4) Applications; required certifications.--Each small business 
concern seeking assistance under this subsection shall, for each 
contract with respect to which such assistance is sought, submit an 
application to the Administrator, which shall include--
            ``(A) a written certification that--
                    ``(i) the small business concern meets the 
                requirements of paragraphs (5) and (6), and expects to 
                continue to meet those requirements during the term of 
                the contract at issue;
                    ``(ii) not less than 30 percent of the contract at 
                issue will be performed by economically disadvantaged 
                individuals employed by the small business concern; and
                    ``(iii) during the term of the contract at issue, 
                the small business concern will not terminate the 
                employment of any economically disadvantaged individual 
                employed by the small business concern or any 
                individual employed by the small business concern who 
                resides in any area described in paragraph (5)(B)(i), 
                except for just cause; and
            ``(B) such documentation as the Administrator may require, 
        in order to verify the status of the small business concern as 
        an economically disadvantaged small business concern, 
        including--
                    ``(i) relevant tax forms and information;
                    ``(ii) a copy of the birth certificates of 
                dependent children of economically disadvantaged 
                individuals employed by the small business concern; and
                    ``(iii) sworn affidavits from economically 
                disadvantaged individuals employed by the small 
                business concern necessary to verify the status of 
                those individuals as economically disadvantaged 
                individuals.
    ``(5) Economically disadvantaged small business concern.--For 
purposes of this subsection, the term `economically disadvantaged small 
business concern' means--
            ``(A) a small business concern, if not less than 35 percent 
        of the employees of the small business concern, who are 
        employed by the small business concern as of the date on which 
        the application is submitted under paragraph (4), and who were 
        hired by the small business concern during the 5-year period 
        preceding the date on which the small business concern submits 
        an application for assistance under this subsection, were 
        economically disadvantaged individuals, as of the date on which 
        those employees were hired by the small business concern; or
            ``(B) a small business concern, the operations and 
        facilities of which are predominately located in an area 
        nominated before the date of enactment of the Community Renewal 
        and Economic Opportunity Act for designation--
                    ``(i) under section 1391 of the Internal Revenue 
                Code of 1986 as an empowerment zone or enterprise 
                community (whether or not so designated); or
                    ``(ii) under section 701 of the Housing and 
                Community Development Act of 1987 as an enterprise zone 
                (whether or not so designated).
    ``(6) Economically disadvantaged individual.--
            ``(A) Definition.--For purposes of this subsection, the 
        term `economically disadvantaged individual' means an 
        individual who is a United States citizen, having a net 
        financial worth of not more than $2,000--
                    ``(i) who, as of the date on which the individual 
                was hired by the small business concern--
                            ``(I) was not claimed as a dependent on any 
                        Federal or State income tax return filed for 
                        the 4 taxable years preceding that date; and
                            ``(II) earned a net monthly income that did 
                        not exceed 100 percent of the poverty line (as 
                        that term is defined in section 673 of the 
                        Community Service Block Grant Act (42 U.S.C. 
                        9902)), both during the 1-year period preceding 
                        that date, and during not less than 3 of the 4 
                        taxable years immediately preceding that date; 
                        or
                    ``(ii) who, as of the date on which the individual 
                was hired by the small business concern--
                            ``(I) was not claimed as a dependent on any 
                        Federal or State income tax return filed for 
                        the taxable year preceding that date;
                            ``(II) earned a net monthly income that did 
                        not exceed 100 percent of the poverty line (as 
                        that term is defined in section 673 of the 
                        Community Service Block Grant Act (42 U.S.C. 
                        9902)) during the 1-year period preceding that 
                        date; and
                            ``(III) had one or more dependents who were 
                        18 years of age or younger.
            ``(B) Calculation of net financial worth.--In calculating 
        the net financial worth of an individual for purposes of 
        subparagraph (A), the administrator shall--
                    ``(i) include the fair market value of any checking 
                or savings accounts, cash, stocks, bonds, and any other 
                personal property of the individual;
                    ``(ii) exclude any equity of the individual in the 
                primary personal residence of the individual or in the 
                furnishings of that residence; and
                    ``(iii) establish procedures for calculating the 
                value of any motor vehicle owned by the individual.'';
            (3) by striking paragraph (8) and inserting the following:
    ``(7) Preferences.--In awarding contracts under this subsection, 
the administrator shall establish a system that gives preference to 
economically disadvantaged small business concerns--
            ``(A) more than 35 percent of the employees of which are 
        economically disadvantaged individuals; or
            ``(B) not less than 35 percent of the ownership of which is 
        vested in one or more individuals who reside in any area 
        described in paragraph (5)(B)(i).'';
            (4) in paragraph (10), in the second sentence, by striking 
        ``for certification'';
            (5) in paragraph (12)--
                    (A) by striking subparagraphs (A) and (B) and 
                redesignating subparagraphs (C) through (F) as 
                subparagraphs (A) through (D);
                    (B) in subparagraph (B), as redesignated, by 
                striking ``subparagraph (C)'' and inserting 
                ``subparagraph (A)''; and
                    (C) in subparagraph (C), as redesignated, by 
                striking ``subparagraph (D)'' and inserting 
                ``subparagraph (B)'';
            (6) in paragraph (16)(A)--
                    (A) by striking ``Program Participant'' each place 
                that term appears and inserting ``small business 
                concern'';
                    (B) in clause (i), by adding ``and'' at the end;
                    (C) in clause (ii), by striking ``; and'' and 
                inserting a period; and
                    (D) by striking clause (iii);
            (7) in paragraph (18)--
                    (A) in subparagraph (A)--
                            (i) by striking ``Program Participant'' the 
                        second place that term appears and inserting 
                        ``small business concern'';
                            (ii) by striking ``Program Participant'' 
                        the first place that term appears and inserting 
                        ``small business concern receiving assistance 
                        under this subsection'';
                            (iii) by striking ``Program Participants'' 
                        and inserting ``small business concerns''; and
                            (iv) by striking ``, section 7(j)(10),''; 
                        and
                    (B) in subparagraph (C)(ii)--
                            (i) by striking subclause (III), and 
                        redesignating subclauses (IV) and (V) as 
                        subclauses (III) and (IV), respectively; and
                            (ii) in subclause (III), as redesignated, 
                        by striking ``or section 7(j)(10)'';
            (8) in paragraph (21)--
                    (A) by striking ``(A) Subject to the provisions of 
                subparagraph (B), a'' and inserting ``Each''; and
                    (B) by striking ``Notwithstanding the provisions'' 
                and all that follows through the end of the paragraph;
            (9) by striking paragraph (9) and redesignating paragraphs 
        (10) through (12) as paragraphs (9) through (11), respectively;
            (10) by striking paragraph (13) and redesignating paragraph 
        (14) as paragraph (12);
            (11) by striking paragraph (15) and redesignating 
        paragraphs (16) through (19) as paragraphs (13) through (16), 
        respectively;
            (12) by striking paragraph (20) and redesignating paragraph 
        (21) as paragraph (17); and
            (13) by adding at the end the following new paragraph:
    ``(18) Annual report.--The Administrator shall annually submit a 
report to the Congress, which shall include the following with respect 
to the fiscal year immediately preceding submission of the report:
            ``(A) Costs and benefits.--A description and estimate of 
        the benefits and costs that have accrued to the economy and the 
        Federal Government during that fiscal year due to the 
        operations of those small business concerns that were 
        performing contracts awarded pursuant to this subsection during 
that fiscal year.
            ``(B) List of participants.--A list of all small business 
        concerns receiving assistance under this subsection during that 
        fiscal year identifying, by State and by Region, the dollar 
        amount of advance payments received by each small business 
        concern pursuant to contracts awarded under this subsection, 
        and a description including (if appropriate) an estimate of the 
        dollar value of all benefits received by each small business 
        concern pursuant to section 7(a)(20) during that fiscal year.
            ``(C) Total value of contracts and options awarded.--The 
        total dollar value of contracts and options awarded under this 
        subsection during that fiscal year, and such amount expressed 
        as a percentage of total sales of all small business concerns 
        receiving assistance under this subsection during that fiscal 
        year.
            ``(D) Value of contracts and options awarded by standard 
        industrial classification code.--The total dollar value of 
        contracts and options awarded under this subsection during that 
        fiscal year, at such dollar increments as the Administrator 
        deems appropriate, for each 4-digit standard industrial 
        classification code under which such contracts and options were 
        classified.
            ``(E) Additional resources.--A description of such 
        additional resources as may be required to provide the types of 
        services needed over the succeeding 2-year period to service 
        the projected portfolio of small business concerns receiving 
        assistance under this subsection.''.
    (g) Performance of Contracts.--Section 8(d) of the Small Business 
Act (15 U.S.C. 637(d)) is amended--
            (1) in paragraph (1)--
                    (A) in the first sentence, by striking ``,, small 
                business concerns owned and controlled by socially and 
                economically disadvantaged individuals, and small 
                business concerns owned and controlled by women,'' and 
                inserting ``and economically disadvantaged small 
                business concerns''; and
                    (B) in the second sentence, by striking ``, small 
                business concerns owned and controlled by socially and 
                economically disadvantaged individuals, and small 
                business concerns owned and controlled by women'' and 
                inserting ``and economically disadvantaged small 
                business concerns'';
            (2) in paragraph (3)--
                    (A) in subparagraph (A), by striking ``, small 
                business concerns owned and controlled by socially and 
                economically disadvantaged individuals, and small 
                business concerns owned and controlled by women'' each 
                place that term appears and inserting ``and 
                economically disadvantaged small business concerns'';
                    (B) by striking subparagraphs (C) and (D) and 
                inserting the following:
            ``(C) For purposes of this contract, the terms `small 
        business concern' and `economically disadvantaged small 
        business concern' have the same meanings as in section 3 of the 
        Small Business Act.'';
                    (C) by redesignating subparagraph (E) as 
                subparagraph (D); and
                    (D) in subparagraph (D), as redesignated, by 
                striking ``, a small business concern owned and 
                controlled by socially and economically disadvantaged 
                individuals, or a small business concern owned and 
                controlled by women'' and inserting ``or an 
                economically disadvantaged small business concern'';
            (3) in paragraph (4)--
                    (A) in subparagraph (D), by striking ``, small 
                business concerns owned and controlled by socially and 
                economically disadvantaged individuals, and small 
                business concerns owned and controlled by women'' and 
                inserting ``and economically disadvantaged small 
                business concerns''; and
                    (B) in subparagraph (E), by striking ``small 
                business concerns owned and controlled by socially and 
                economically disadvantaged individuals'' and all that 
                follows through ``women'' and inserting ``economically 
                disadvantaged small business concerns'';
            (4) in paragraph (6), by striking subparagraph (A) and 
        inserting the following:
            ``(A) percentage goals for the utilization as 
        subcontractors of small business concerns and economically 
        disadvantaged small business concerns;''; and
            (5) in paragraph (10)(B), by striking ``, small business 
        concerns owned and controlled by socially and economically 
        disadvantaged individuals, and small business concerns owned 
        and controlled by women'' and inserting ``and economically 
        disadvantaged small business concerns''.
    (h) Policy Directives.--Section 9(j)(2)(F) of the Small Business 
Act (15 U.S.C. 638(j)(2)(F)) is amended--
            (1) by striking ``socially and''; and
            (2) by striking ``, as defined in section 8(a)(4),''.
    (i) Awards or Contracts.--Section 15 of the Small Business Act (15 
U.S.C. 644) is amended--
            (1) in subsection (g)(1)--
                    (A) by striking ``, small business concerns owned 
                and controlled by socially and economically 
                disadvantaged individuals, and small business concerns 
                owned and controlled by women'' each place that term 
                appears and inserting ``and economically disadvantaged 
                small business concerns'';
                    (B) in the third sentence, by striking ``small 
                business concerns owned and controlled by socially and 
                economically disadvantaged individuals'' and inserting 
                ``economically disadvantaged small business concerns''; 
                and
                    (C) by striking the fourth sentence;
            (2) in subsection (g)(2)--
                    (A) in the first sentence, by striking ``,, by 
                small business concerns owned and controlled by 
                socially and economically disadvantaged individuals, 
                and by small business concerns owned and controlled by 
                women'' and inserting ``and by economically 
                disadvantaged small business concerns'';
                    (B) in the second sentence, by striking ``, small 
                business concerns owned and controlled by socially and 
                economically disadvantaged individuals, and small 
                business concerns owned and controlled by women'' and 
                inserting ``and economically disadvantaged small 
                business concerns''; and
                    (C) in the fourth sentence, by striking ``small 
                business concerns owned and controlled by socially and 
                economically disadvantaged individuals and 
                participation by small business concerns owned and 
                controlled by women'' and inserting ``economically 
                disadvantaged small business concerns''; and
            (3) in subsection (h)--
                    (A) by striking ``, small business concerns owned 
                and controlled by socially and economically 
                disadvantaged individuals, and small business concerns 
                owned and controlled by women'' each place that term 
                appears and inserting ``and economically disadvantaged 
                small business concerns''; and
                    (B) in paragraph (2)--
                            (i) in subparagraph (D)(ii), by striking 
                        ``small business concerns owned and controlled 
                        by socially and economically disadvantaged 
                        individuals'' and inserting ``economically 
                        disadvantaged small business concerns''; and
                            (ii) by striking subparagraph (F).
    (j) Offenses and Penalties.--Section 16 of the Small Business Act 
(15 U.S.C. 645) is amended--
            (1) in subsection (d)(1)--
                    (A) by striking ``, a `small business concern owned 
                and controlled by socially and economically 
                disadvantaged individuals''' and all that follows 
                through ``women''' and inserting ``or an `economically 
                disadvantaged small business concern'''; and
                    (B) in subparagraph (D), by striking ``section 
                8(d)'' and inserting ``subsection (a) or (d) of section 
                8(a) of this Act'';
            (2) in subsection (e), by striking ``, a `small business 
        concern owned and controlled by socially and economically 
        disadvantaged individuals''' and all that follows through 
        ``women''' and inserting ``or an `economically disadvantaged 
        small business concern'''; and
            (3) by striking subsection (f).

SEC. 112. TECHNICAL AND CONFORMING AMENDMENTS IN OTHER LAW.

    (a) Title 10, United States Code.--Section 2323 of title 10, United 
States Code, is amended--
            (1) in subsection (a)(1), by striking subparagraph (A) and 
        inserting the following:
            ``(A) economically disadvantaged small business concerns, 
        including mass media and advertising firms;'';
            (2) in subsection (f), by striking ``a small business 
        concern owned and controlled by a minority'' and inserting ``an 
        economically disadvantaged small business concern'';
            (3) in subsection (i)(3)--
                    (A) in subparagraph (B), by striking ``not owned 
                and controlled by socially and economically 
                disadvantaged individuals'' and inserting ``that are 
                not economically disadvantaged small business 
                concerns''; and
                    (B) by striking subparagraph (C); and
            (4) in subsection (j), by adding at the end the following 
        new paragraph:
            ``(3) The term `economically disadvantaged small business 
        concern' has the same meaning as in section 8(a) of the Small 
        Business Act.''.
    (b) Federal Home Loan Bank Act.--Section 21A(b)(13) of the Federal 
Home Loan Bank Act (12 U.S.C. 1441a(b)(13)) is amended by striking 
``small business concerns owned and controlled by socially and 
economically disadvantaged individuals'' and inserting ``economically 
disadvantaged small business concerns (as that term is defined in 
section 8(a) of the Small Business Act)''.
    (c) Small Business Economic Policy Act of 1980.--Section 303(e) of 
the Small Business Economic Policy Act of 1980 (15 U.S.C. 631b(e)) is 
amended by striking paragraph (1) and inserting the following:
            ``(1) economically disadvantaged small business concerns 
        (as that term is defined in section 8(a) of the Small Business 
        Act);''.
    (d) Small Business Investment Act of 1958.--Section 411(c)(3)(B) of 
the Small Business Investment Act of 1958 (15 U.S.C. 694b(c)(3)(B)) is 
amended by striking ``a small business concern owned'' and all that 
follows before the semicolon and inserting ``an economically 
disadvantaged small business concern (as that term is defined in 
section 8(a) of the Small Business Act)''.
    (e) Title 31, United States Code.--Title 31, United States Code, is 
amended--
            (1) in section 3718(b)--
                    (A) in paragraph (1)(B), by striking ``law firms 
                owned and controlled by socially and economically 
                disadvantaged individuals'' and inserting 
                ``economically disadvantaged law firms''; and
                    (B) in paragraph (3), by striking ``law firms owned 
                and controlled by socially and economically 
                disadvantaged individuals. For purposes of'' and all 
                that follows through the end of the paragraph, and 
                inserting the following: ``economically disadvantaged 
                law firms. For purposes of this paragraph, the term 
                `economically disadvantaged law firm' means a law firm, 
                regardless of whether or not the law firm is a small 
                business concern (as that term is defined in section 3 
                of the Small Business Act), that is otherwise described 
                in either section 8(a)(5)(A) of the Small Business Act 
                or clauses (i) and (ii) of section 8(a)(5)(B) of the 
                Small Business Act.'';
            (2) in section 6701(f)--
                    (A) in paragraph (1)(A), by striking ``small 
                business concerns controlled by socially and 
                economically disadvantaged individuals and women'' and 
                inserting ``economically disadvantaged small business 
                concerns''; and
                    (B) by striking paragraph (3)(B) and inserting the 
                following:
                    ``(B) the term `economically disadvantaged small 
                business concern' has the same meaning as in section 
                8(a) of the Small Business Act.''; and
            (3) in section 7505(c), by striking ``business concerns 
        owned and controlled by socially and economically disadvantaged 
        individuals'' and inserting ``economically disadvantaged small 
        business concerns (as that term is defined in section 8(a) of 
        the Small Business Act)''.
    (f) Office of Federal Procurement Policy Act.--
            (1) Enumeration of included functions.--Section 6(d) of the 
        Office of Federal Procurement Policy Act (41 U.S.C. 405(d)) is 
        amended--
                    (A) in paragraph (5)(C), by striking ``small 
                business concerns owned'' and all that follows through 
                ``minorities'' and inserting ``economically 
                disadvantaged small business concerns (as that term is 
                defined in section 8(a) of the Small Business Act)'';
                    (B) in paragraph (10), by striking ``small 
                businesses,'' and all that follows through ``women'' 
                and inserting ``small business concerns and 
                economically disadvantaged small business concerns (as 
                those terms are defined in section 3 of the Small 
                Business Act)''; and
                    (C) in paragraph (11), by striking ``small 
                businesses,'' and all that follows through ``women'' 
                and inserting ``small business concerns and 
                economically disadvantaged small business concerns (as 
                those terms are defined in section 3 of the Small 
                Business Act)''.
            (2) Procurement data.--Section 19A of the Office of Federal 
        Procurement Policy Act (41 U.S.C. 417a) is amended--
                    (A) in subsection (a), by striking ``small 
                businesses owned'' and all that follows through 
                ``gender,'' and inserting ``economically disadvantaged 
                small business concerns''; and
                    (B) by striking subsection (b) and inserting the 
                following:
    ``(b) Definition.--For purposes of this section, the term 
`economically disadvantaged small business concern' has the same 
meaning as in section 8(a) of the Small Business Act.''.
    (g) Energy Policy Act of 1992.--Section 3021 of the Energy Policy 
Act of 1992 (42 U.S.C. 13556) is amended--
            (1) in subsection (a), by striking paragraph (1) and 
        inserting the following:
            ``(1) economically disadvantaged small business 
        concerns;''; and
            (2) in subsection (b), by striking paragraph (2) and 
        inserting the following:
            ``(2) The term `economically disadvantaged small business 
        concern' has the same meaning as in section 8(a) of the Small 
        Business Act.''.
    (h) Title 49, United States Code.--Title 49, United States Code, is 
amended--
            (1) in section 47107(e)--
                    (A) in paragraph (1), by striking ``small business 
                concerns'' and all that follows before the period and 
                inserting ``economically disadvantaged small business 
                concerns (as that term is defined in section 8(a) of 
                the Small Business Act)'';
                    (B) in paragraph (4)(B), by striking ``a small 
                business concern owned and controlled by a socially and 
                economically disadvantaged individual'' and inserting 
                ``an economically disadvantaged small business concern 
                (as that term is defined in section 8(a) of the Small 
                Business Act)''; and
                    (C) in paragraph (6), by striking ``a small 
                business concern'' and all that follows before the 
                period and inserting ``an economically disadvantaged 
                small business concern (as that term is defined in 
                section 8(a) of the Small Business Act)''; and
            (2) in section 47113--
                    (A) by striking subsection (a) and inserting the 
                following:
    ``(a) Definitions.--For purposes of this section--
            ``(1) the term `economically disadvantaged small business 
        concern' has the same meaning as in section 8(a) of the Small 
        Business Act; and
            ``(2) the term `small business concern' has the same 
        meaning as in section 3 of the Small Business Act, except that 
        the term does not include a small business concern that has 
        average annual gross receipts during the most recent 3 fiscal 
        years of more than $16,015,000, as adjusted by the Secretary of 
        Transportation for inflation.''; and
                    (B) in subsection (b), by striking ``small business 
                concerns owned and controlled by socially and 
                economically disadvantaged individuals'' and inserting 
                ``economically disadvantaged small business concerns''.
    (i) Defense Production Act of 1950.--Section 702 of the Defense 
Production Act of 1950 (50 U.S.C. 2152) is amended--
            (1) in paragraph (16), by striking ``such business concerns 
        owned and controlled by socially and economically disadvantaged 
        individuals or by women'' and inserting ``economically 
        disadvantaged small business concerns''; and
            (2) by striking paragraph (17) and inserting the following:
            ``(17) Economically disadvantaged small business concern.--
        The term `economically disadvantaged small business concern' 
        has the same meaning as in section 8(a) of the Small Business 
        Act.''.

SEC. 113. SAVINGS PROVISION.

    Nothing in this title or the amendments made by this title shall 
affect the terms or conditions of any contract entered into before the 
date of enactment of this Act.

SEC. 114. ADDITIONAL TECHNICAL AND CONFORMING AMENDMENTS.

    Not later than 1 year after the date of enactment of this Act, the 
Administrator of the Small Business Administration shall submit to the 
Congress any recommended technical and conforming legislative changes 
necessary to carry out this title and the amendments made by this 
title.

               Subtitle C--Small Business Mentor Program

SEC. 121. ESTABLISHMENT OF MENTOR PROGRAM.

    (a) In General.--Not later than 90 days after the date of enactment 
of this Act, the Administrator shall establish and carry out a program, 
under which--
            (1) the Administrator shall recruit qualified mentors to 
        provide assistance to eligible small business concerns;
            (2) to the maximum extent practicable, each eligible small 
        business concern shall be assigned a qualified mentor from the 
        same or similar industry as the eligible small business 
        concern; and
            (2) each qualified mentor assigned to an eligible small 
        business concern under paragraph (2) shall--
                    (A) provide assistance to the eligible small 
                business concern in the establishment and operation of 
                that small business concern; and
                    (B) otherwise serve as a resource for information, 
                consultation, and assistance for that eligible small 
                business concern.
    (b) Definitions.--For purposes of this section--
            (1) the term ``Administrator'' means the Administrator of 
        the Small Business Administration;
            (2) the term ``eligible small business concern'' means a 
        small business concern that--
                    (A) is a sole proprietorship; and
                    (B) is located in--
                            (i) an area designated--
                                    (I) under section 1391 of the 
                                Internal Revenue Code of 1986 as an 
                                empowerment zone or enterprise 
                                community; or
                                    (II) under section 701 of the 
                                Housing and Community Development Act 
                                of 1987 as an enterprise zone; or
                            (ii) any other area determined by the 
                        Administrator to be an area of high 
                        unemployment;
            (3) the term ``financial institution'' means any bank or 
        savings association (as those terms are defined in section 3 of 
        the Federal Deposit Insurance Act);
            (4) the term ``qualified mentor'' means a small business 
        concern or financial institution that is determined by the 
        Administrator to be qualified to provide assistance described 
        in subsection (a) to eligible small business concerns in the 
        same or similar industry as the small business concern or 
        financial institution; and
            (5) the term ``small business concern'' has the same 
        meaning as in section 3 of the Small Business Act.
    (c) List of Qualified Mentors.--In carrying out this section, the 
Administrator shall establish and maintain a list of available 
qualified mentors.

                   TITLE II--COMMUNITY INFRASTRUCTURE

SEC. 201. LIMITATION ON THE APPLICATION OF THE DAVIS-BACON REQUIREMENTS 
              TO EMPOWERMENT ZONES, ENTERPRISE COMMUNITIES, AND 
              ENTERPRISE ZONES.

    The provisions of the Act of March 3, 1931 (commonly known as the 
Davis-Bacon Act) (40 U.S.C. 276a et seq.) shall not apply to a contract 
for construction, alteration, or repair of a facility in an area 
designated--
            (1) under section 1391 of the Internal Revenue Code of 1986 
        as an empowerment zone or enterprise community; or
            (2) under section 701 of the Housing and Community 
        Development Act of 1987 (42 U.S.C. 11501) as an enterprise 
        zone.

SEC. 202. REFORM OF COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM.

    (a) Increased Assistance to Low- and Moderate-Income Families.--
Section 104(b)(3) of the Housing and Community Development Act of 1974 
(42 U.S.C. 5304(b)(3)) is amended by striking ``except that (A)'' and 
all that follows through ``(B) a grantee'' and inserting the following: 
``except that--
                    ``(A) of funds received under section 106 and, if 
                applicable, as a result of a guarantee or a grant under 
                section 108--
                            ``(i) with respect to activities described 
                        in paragraph (14), (15), and (17) of section 
                        105(a), during a period specified by the 
                        grantee of not more than 3 years, not less than 
                        70 percent shall principally benefit persons of 
                        low and moderate income; and
                            ``(ii) with respect to other activities 
                        assisted with amounts made available under this 
                        title, during a period specified by the grantee 
                        of not more than 12 months, not less than 75 
                        percent shall principally benefit persons of 
                        low and moderate income; and
                    ``(B) a grantee''.
    (b) Reduction in Administration and Planning Costs.--Section 104(b) 
of the Housing and Community Development Act of 1974 (42 U.S.C. 
5304(b)) is amended--
            (1) in paragraph (5), by striking ``and'' at the end;
            (2) in paragraph (6), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following new paragraph:
            ``(7) not more than 12 percent of amounts received by the 
        grantee under this title in any fiscal year will be used for 
        administration and planning costs associated with any activity 
        funded in whole or in part with assistance made available under 
        this title.''.
    (c) Matching Fund Requirement.--
            (1) In general.--Section 106(b) of the Housing and 
        Community Development Act of 1974 (42 U.S.C. 5306(b)) is 
        amended by adding at the end the following new paragraph:
            ``(7) Matching fund requirement.--Notwithstanding any other 
        provision of law, in each fiscal year, the Secretary shall--
                    ``(A) require each metropolitan city or urban 
                county that is among the wealthiest 10 percent (or such 
                other percentage as the Secretary may establish) of 
                metropolitan cities and urban counties receiving 
                assistance under this title in that fiscal year, to 
                make available contributions (from sources other than 
                assistance made available under this title) in an 
                amount equal to a specified percentage of the amount 
                allocated under this subsection to that metropolitan 
                city or urban county, which percentage shall be 
                established by the Secretary;
                    ``(B) reduce the amount allocated under this 
                subsection to that metropolitan city or urban county by 
                the amount of the contributions made available under 
                subparagraph (A); and
                    ``(C) increase the total amount otherwise available 
                for allocation under this subsection to metropolitan 
                cities and urban counties that are not described in 
                subparagraph (A) by the aggregate amount of the 
                reductions under subparagraph (B).''.
            (2) Applicability.--The amendment made by paragraph (1) 
        shall be effective with respect to fiscal year 1997, and each 
        fiscal year thereafter.
    (d) Increased Davis-Bacon Threshold for Construction Projects.--
Section 110 of the Housing and Community Development Act of 1974 (42 
U.S.C. 5310) is amended by adding at the end the following new 
subsection:
    ``(c) Minimum Threshold.--Subsection (a) does not apply to any 
individual engaged construction work if the total cost of the activity 
assisted under this title to which the construction work relates does 
not exceed $250,000.''.
    (e) Penalty for Default on Economic Development Loan.--Section 111 
of the Housing and Community Development Act of 1974 (42 U.S.C. 5311) 
is amended by adding at the end the following new subsection:
    ``(d) Excessive Defaults on Economic Development Loans.--With 
respect to any recipient of assistance under this title that the 
Secretary determines to have an excessive rate of default on loans 
guaranteed under section 108 and assisted under section 108(q), the 
Secretary may reduce payments to the recipient under this title by an 
amount equal to the sum of the outstanding balance of that loan, 
including principal and interest.''.

                        TITLE III--SAFE STREETS

                   Subtitle A--Mandatory Restitution

SEC. 301. ORDER OF RESTITUTION.

    Section 3556 of title 18, United States Code, is amended--
            (1) by striking ``may'' and inserting ``shall''; and
            (2) by striking ``sections 3663 and 3664.'' and inserting 
        ``3663A, and may order restitution in accordance with section 
        3663. The procedures under section 3664 shall apply to all 
        orders of restitution under this section.''.

SEC. 302. CONDITIONS OF PROBATION.

    Section 3563 of title 18, United States Code, is amended--
            (1) in subsection (a)--
                    (A) in paragraph (3), by striking ``and'' at the 
                end;
                    (B) in the first paragraph (4) (relating to 
                conditions of probation for a domestic crime of 
                violence), by striking the period and inserting a 
                semicolon;
                    (C) by redesignating the second paragraph (4) 
                (relating to conditions of probation concerning drug 
                use and testing) as paragraph (5);
                    (D) in paragraph (5), as redesignated, by striking 
                the period at the end and inserting a semicolon; and
                    (E) by inserting after paragraph (5), as 
                redesignated, the following new paragraphs:
            ``(6) that the defendant--
                    ``(A) make restitution in accordance with sections 
                2248, 2259, 2264, 2327, 3663, 3663A, and 3664; and
                    ``(B) pay the assessment imposed in accordance with 
                section 3013; and
            ``(7) that the defendant will notify the court of any 
        material change in the defendant's economic circumstances that 
        might affect the defendant's ability to pay restitution, fines, 
        or special assessments.''; and
            (2) in subsection (b)--
                    (A) by striking paragraph (2);
                    (B) by redesignating paragraphs (3) through (22) as 
                paragraphs (2) through (21), respectively; and
                    (C) by amending paragraph (2), as redesignated, to 
                read as follows:
            ``(2) make restitution to a victim of the offense under 
        section 3556 (but not subject to the limitation of section 
        3663(a) or 3663A(c)(1)(A));''.

SEC. 303. MANDATORY RESTITUTION.

    (a) In General.--Chapter 232 of title 18, United States Code, is 
amended by inserting immediately after section 3663 the following new 
section:
``Sec. 3663A. Mandatory restitution to victims of certain crimes
    ``(a)(1) Notwithstanding any other provision of law, when 
sentencing a defendant convicted of an offense described in subsection 
(c), the court shall order, in addition to any other penalty authorized 
by law, that the defendant make restitution to the victim of the 
offense, or, if the victim is deceased, to the victim's estate.
    ``(2) For the purposes of this section, the term `victim' means a 
person directly and proximately harmed as a result of the commission of 
an offense for which restitution may be ordered including, in the case 
of an offense that involves as an element a scheme, conspiracy, or 
pattern of criminal activity, any person directly harmed by the 
defendant's criminal conduct in the course of the scheme, conspiracy, 
or pattern. In the case of a victim who is under 18 years of age, 
incompetent, incapacitated, or deceased, the legal guardian of the 
victim or representative of the victim's estate, another family member, 
or any other person appointed as suitable by the court, may assume the 
victim's rights under this section, but in no event shall the defendant 
be named as such representative or guardian.
    ``(3) The court shall also order, if agreed to by the parties in a 
plea agreement, restitution to persons other than the victim of the 
offense.
    ``(b) The order of restitution shall require that such defendant--
            ``(1) in the case of an offense resulting in damage to or 
        loss or destruction of property of a victim of the offense--
                    ``(A) return the property to the owner of the 
                property or someone designated by the owner; or
                    ``(B) if return of the property under subparagraph 
                (A) is impossible, impracticable, or inadequate, pay an 
                amount equal to--
                            ``(i) the greater of--
                                    ``(I) the value of the property on 
                                the date of the damage, loss, or 
                                destruction; or
                                    ``(II) the value of the property on 
                                the date of sentencing, less
                            ``(ii) the value (as of the date the 
                        property is returned) of any part of the 
                        property that is returned;
            ``(2) in the case of an offense resulting in bodily injury 
        to a victim--
                    ``(A) pay an amount equal to the cost of necessary 
                medical and related professional services and devices 
                relating to physical, psychiatric, and psychological 
                care, including nonmedical care and treatment rendered 
                in accordance with a method of healing recognized by 
                the law of the place of treatment;
                    ``(B) pay an amount equal to the cost of necessary 
                physical and occupational therapy and rehabilitation; 
                and
                    ``(C) reimburse the victim for income lost by such 
                victim as a result of such offense;
            ``(3) in the case of an offense resulting in bodily injury 
        that results in the death of the victim, pay an amount equal to 
        the cost of necessary funeral and related services; and
            ``(4) in any case, reimburse the victim for lost income and 
        necessary child care, transportation, and other expenses 
        incurred during participation in the investigation or 
        prosecution of the offense or attendance at proceedings related 
        to the offense.
    ``(c)(1) This section shall apply in all sentencing proceedings for 
convictions of, or plea agreements relating to charges for, any 
offense--
            ``(A) that is--
                    ``(i) a crime of violence, as defined in section 
                16;
                    ``(ii) an offense against property under this 
                title, including any offense committed by fraud or 
                deceit; or
                    ``(iii) an offense described in section 1365 
                (relating to tampering with consumer products); and
            ``(B) in which an identifiable victim or victims has 
        suffered a physical injury or pecuniary loss.
    ``(2) In the case of a plea agreement that does not result in a 
conviction for an offense described in paragraph (1), this section 
shall apply only if the plea specifically states that an offense listed 
under such paragraph gave rise to the plea agreement.
    ``(3) This section shall not apply if the court finds, from facts 
on the record, that--
            ``(A) the number of identifiable victims is so large as to 
        make restitution impracticable; or
            ``(B) determining complex issues of fact related to the 
        cause or amount of the victim's losses would complicate or 
        prolong the sentencing process to a degree that the need to 
        provide restitution to any victim is outweighed by the burden 
        on the sentencing process.
    ``(d) An order of restitution under this section shall be issued 
and enforced in accordance with section 3664.''.
    (b) Clerical Amendment.--The analysis for chapter 232 of title 18, 
United States Code, is amended by inserting immediately after the 
matter relating to section 3663 the following:

``3663A. Mandatory restitution to victims of certain crimes.''.

SEC. 304. ORDER OF RESTITUTION TO VICTIMS OF OTHER CRIMES.

    (a) In General.--Section 3663 of title 18, United States Code, is 
amended--
            (1) in subsection (a)(1)--
                    (A) by striking ``(a)(1) The court'' and inserting 
                ``(a)(1)(A) The court'';
                    (B) by inserting ``, section 401, 408(a), 409, 416, 
                420, or 422(a) of the Controlled Substances Act (21 
                U.S.C. 841, 848(a), 849, 856, 861, 863) (but in no case 
                shall a participant in an offense under such sections 
                be considered a victim of such offense under this 
                section),'' before ``or section 46312,'';
                    (C) by inserting ``other than an offense described 
                in section 3663A(c),'' after ``title 49,'';
                    (D) by inserting before the period at the end the 
                following: ``, or if the victim is deceased, to the 
                victim's estate'';
                    (E) by adding at the end the following new 
                subparagraph:
    ``(B)(i) The court, in determining whether to order restitution 
under this section, shall consider--
            ``(I) the amount of the loss sustained by each victim as a 
        result of the offense; and
            ``(II) the financial resources of the defendant, the 
        financial needs and earning ability of the defendant and the 
        defendant's dependents, and such other factors as the court 
        deems appropriate.
    ``(ii) To the extent that the court determines that the 
complication and prolongation of the sentencing process resulting from 
the fashioning of an order of restitution under this section outweighs 
the need to provide restitution to any victims, the court may decline 
to make such an order.''; and
                    (F) by amending paragraph (2) to read as follows:
    ``(2) For the purposes of this section, the term `victim' means a 
person directly and proximately harmed as a result of the commission of 
an offense for which restitution may be ordered including, in the case 
of an offense that involves as an element a scheme, conspiracy, or 
pattern of criminal activity, any person directly harmed by the 
defendant's criminal conduct in the course of the scheme, conspiracy, 
or pattern. In the case of a victim who is under 18 years of age, 
incompetent, incapacitated, or deceased, the legal guardian of the 
victim or representative of the victim's estate, another family member, 
or any other person appointed as suitable by the court, may assume the 
victim's rights under this section, but in no event shall the defendant 
be named as such representative or guardian.'';
            (2) by striking subsections (c) through (i); and
            (3) by adding at the end the following new subsections:
    ``(c)(1) Notwithstanding any other provision of law (but subject to 
the provisions of subsections (a)(1)(B) (i)(II) and (ii), when 
sentencing a defendant convicted of an offense described in section 
401, 408(a), 409, 416, 420, or 422(a) of the Controlled Substances Act 
(21 U.S.C. 841, 848(a), 849, 856, 861, 863), in which there is no 
identifiable victim, the court may order that the defendant make 
restitution in accordance with this subsection.
    ``(2)(A) An order of restitution under this subsection shall be 
based on the amount of public harm caused by the offense, as determined 
by the court in accordance with guidelines promulgated by the United 
States Sentencing Commission.
    ``(B) In no case shall the amount of restitution ordered under this 
subsection exceed the amount of the fine ordered for the offense 
charged in the case.
    ``(3) Restitution under this subsection shall be distributed as 
follows:
            ``(A) 65 percent of the total amount of restitution shall 
        be paid to the Victim Assistance Administration of the State in 
        which the crime occurred.
            ``(B) 35 percent of the total amount of restitution shall 
        be paid to the State entity designated to receive Federal 
        substance abuse block grant funds.
    ``(4) The court shall not make an award under this subsection if it 
appears likely that such award would interfere with a forfeiture under 
section 981 or 982.
    ``(5) Notwithstanding section 3612(c) or any other provision of 
law, a penalty assessment under section 3013 or a fine under subchapter 
C of chapter 227 shall take precedence over an order of restitution 
under this subsection.
    ``(6) Requests for community restitution under this subsection 
shall be considered in all plea agreements negotiated by the United 
States.
    ``(7)(A) The United States Sentencing Commission shall promulgate 
guidelines to assist courts in determining the amount of restitution 
that may be ordered under this subsection.
    ``(B) No restitution shall be ordered under this subsection until 
such time as the Sentencing Commission promulgates guidelines pursuant 
to this paragraph.
    ``(d) An order of restitution made pursuant to this section shall 
be issued and enforced in accordance with section 3664.''.
    (b) Sexual Abuse.--Section 2248 of title 18, United States Code, is 
amended--
            (1) in subsection (a), by inserting ``or 3663A'' after 
        ``3663'';
            (2) in subsection (b)--
                    (A) by amending paragraph (1) to read as follows:
            ``(1) Directions.--The order of restitution under this 
        section shall direct the defendant to pay to the victim 
        (through the appropriate court mechanism) the full amount of 
        the victim's losses as determined by the court pursuant to 
        paragraph (2).'';
                    (B) by amending paragraph (2) to read as follows:
            ``(2) Enforcement.--An order of restitution under this 
        section shall be issued and enforced in accordance with section 
        3664 in the same manner as an order under section 3663A.'';
                    (C) in paragraph (4), by striking subparagraphs (C) 
                and (D); and
                    (D) by striking paragraphs (5) through (10);
            (3) by striking subsections (c) through (e); and
            (4) by redesignating subsection (f) as subsection (c).
    (c) Sexual Exploitation and Other Abuse of Children.--Section 2259 
of title 18, United States Code, is amended--
            (1) in subsection (a), by inserting ``or 3663A'' after 
        ``3663'';
            (2) in subsection (b)--
                    (A) by amending paragraph (1) to read as follows:
            ``(1) Directions.--The order of restitution under this 
        section shall direct the defendant to pay the victim (through 
        the appropriate court mechanism) the full amount of the 
        victim's losses as determined by the court pursuant to 
        paragraph (2).'';
                    (B) by amending paragraph (2) to read as follows:
            ``(2) Enforcement.--An order of restitution under this 
        section shall be issued and enforced in accordance with section 
        3664 in the same manner as an order under section 3663A.'';
                    (C) in paragraph (4), by striking subparagraphs (C) 
                and (D); and
                    (D) by striking paragraphs (5) through (10);
            (3) by striking subsections (c) through (e); and
            (4) by redesignating subsection (f) as subsection (e).
    (d) Domestic Violence.--Section 2264 of title 18, United States 
Code, is amended--
            (1) in subsection (a), by inserting ``or 3663A'' after 
        ``3663'';
            (2) in subsection (b)--
                    (A) by amending paragraph (1) to read as follows:
            ``(1) Directions.--The order of restitution under this 
        section shall direct the defendant to pay the victim (through 
        the appropriate court mechanism) the full amount of the 
        victim's losses as determined by the court pursuant to 
        paragraph (2).'';
                    (B) by amending paragraph (2) to read as follows:
            ``(2) Enforcement.--An order of restitution under this 
        section shall be issued and enforced in accordance with section 
        3664 in the same manner as an order under section 3663A.'';
                    (C) in paragraph (4), by striking subparagraphs (C) 
                and (D); and
                    (D) by striking paragraphs (5) through (10);
            (3) by striking subsections (c) through (g); and
            (4) by adding at the end the following new subsection (c):
    ``(c) Victim Defined.--For purposes of this section, the term 
`victim' means the individual harmed as a result of a commission of a 
crime under this chapter, including, in the case of a victim who is 
under 18 years of age, incompetent, incapacitated, or deceased, the 
legal guardian of the victim or representative of the victim's estate, 
another family member, or any other person appointed as suitable by the 
court, but in no event shall the defendant be named as such 
representative or guardian.''.
    (e) Telemarketing Fraud.--Section 2327 of title 18, United States 
Code, is amended--
            (1) in subsection (a), by inserting ``or 3663A'' after 
        ``3663'';
            (2) in subsection (b)--
                    (A) by amending paragraph (1) to read as follows:
            ``(1) Directions.--The order of restitution under this 
        section shall direct the defendant to pay to the victim 
        (through the appropriate court mechanism) the full amount of 
        the victim's losses as determined by the court pursuant to 
        paragraph (2).'';
                    (B) by amending paragraph (2) to read as follows:
            ``(2) Enforcement.--An order of restitution under this 
        section shall be issued and enforced in accordance with section 
        3664 in the same manner as an order under section 3663A.'';
                    (C) in paragraph (4), by striking subparagraphs (C) 
                and (D); and
                    (D) by striking paragraphs (5) through (10);
            (3) by striking subsections (c) through (e); and
            (4) by redesignating subsection (f) as subsection (c).

SEC. 305. PROCEDURE FOR ISSUANCE AND ENFORCEMENT OF RESTITUTION ORDER.

    (a) In General.--Section 3664 of title 18, United States Code, is 
amended to read as follows:
``Sec. 3664. Procedure for issuance and enforcement of order of 
              restitution
    ``(a) For orders of restitution under this title, the court shall 
order the probation service of the court to obtain and include in its 
presentence report, or in a separate report, as the court directs, 
information sufficient for the court to exercise its discretion in 
fashioning a restitution order. The report shall include, to the extent 
practicable, a complete accounting of the losses to each victim, any 
restitution owed pursuant to a plea agreement, and information relating 
to the economic circumstances of each defendant. If the number or 
identity of victims cannot be reasonably ascertained, or other 
circumstances exist that make this requirement clearly impracticable, 
the probation service shall so inform the court.
    ``(b) The court shall disclose to both the defendant and the 
attorney for the Government all portions of the presentence or other 
report pertaining to the matters described in subsection (a) of this 
section.
    ``(c) The provisions of this chapter, chapter 227, and Rule 32(c) 
of the Federal Rules of Criminal Procedure shall be the only rules 
applicable to proceedings under this section.
    ``(d)(1) Within 60 days after conviction and, in any event, not 
later than 10 days prior to sentencing--
            ``(A)(i) the attorney for the Government, after consulting 
        with all identified victims, shall promptly provide the 
        probation service of the court with a listing of the amounts 
        subject to restitution;
            ``(ii) the attorney for the Government shall provide notice 
        to all identified victims, informing the victims of the 
        offenses of which the defendant was convicted, the listing of 
        amounts subject to restitution submitted to the probation 
        service, the victim's right to submit information to the 
        probation service concerning the amount of the victim's losses, 
        and the scheduled date, time, and place of the sentencing 
        hearing; and
            ``(iii) if any victim objects to any of the information 
        provided to the probation service relating to the amount of the 
        victim's losses subject to restitution, the attorney for the 
        Government shall advise the victim that the victim may file a 
        separate affidavit and shall provide the victim with an 
        affidavit form which may be used to do so; and
            ``(B) each defendant shall prepare and file with the 
        probation service of the court an affidavit fully describing 
        the financial resources of the defendant, including a complete 
        listing of all assets owned or controlled by the defendant as 
        of the date on which the defendant was arrested, the financial 
needs and earning ability of the defendant and the defendant's 
dependents, and other information the court requires relating to such 
other factors as the court deems appropriate.
    ``(2) After reviewing the report of the probation service of the 
court, the court may require additional documentation or hear 
testimony. The privacy of any records filed, or testimony heard, 
pursuant to this section shall be maintained to the greatest extent 
possible, and such records may be filed or testimony heard in camera.
    ``(3) If the victim's losses are not ascertainable by the date that 
is 10 days prior to sentencing as provided in paragraph (1), the 
attorney for the Government shall so inform the court, and the court 
shall set a date for the final determination of the victim's losses, 
not to exceed 90 days after sentencing. If the victim subsequently 
discovers further losses, the victim shall have 60 days after discovery 
of those losses in which to petition the court for an amended 
restitution order. Such order may be granted only upon a showing of 
good cause for the failure to include such losses in the initial claim 
for restitutionary relief.
    ``(4) The court may refer any issue arising in connection with a 
proposed order of restitution to a magistrate or special master for 
proposed findings of fact and recommendations as to disposition, 
subject to a de novo determination of the issue by the court.
    ``(e) Any dispute as to the proper amount or type of restitution 
shall be resolved by the court by the preponderance of the evidence. 
The burden of demonstrating the amount of the loss sustained by a 
victim as a result of the offense shall be on the attorney for the 
Government. The burden of demonstrating the financial resources of the 
defendant and the financial needs of the defendant and such defendant's 
dependents shall be on the defendant. The burden of demonstrating such 
other matters as the court deems appropriate shall be upon the party 
designated by the court as justice requires.
    ``(f)(1)(A) In each order of restitution, the court shall order 
restitution to each victim in the full amount of each victim's losses 
as determined by the court and without consideration of the economic 
circumstances of the defendant.
    ``(B) In no case shall the fact that a victim has received or is 
entitled to receive compensation with respect to a loss from insurance 
or any other source be considered in determining the amount of 
restitution.
    ``(2) Upon determination of the amount of restitution owed to each 
victim, the court shall, pursuant to section 3572, specify in the 
restitution order the manner in which and the schedule according to 
which the restitution is to be paid, in consideration of--
            ``(A) the financial resources and other assets of the 
        defendant, including whether any of these assets are jointly 
        controlled;
            ``(B) projected earnings and other income of the defendant; 
        and
            ``(C) any financial obligations of the defendant; including 
        obligations to dependents.
    ``(3)(A) A restitution order may direct the defendant to make a 
single, lump-sum payment, partial payment at specified intervals, in-
kind payments, or a combination of payments at specified intervals and 
in-kind payments.
    ``(B) A restitution order may direct the defendant to make nominal 
periodic payments if the court finds from facts on the record that the 
economic circumstances of the defendant do not allow the payment of any 
amount of a restitution order, and do not allow for the payment of the 
full amount of a restitution order in the foreseeable future under any 
reasonable schedule of payments.
    ``(4) An in-kind payment described in paragraph (3) may be in the 
form of--
            ``(A) return of property;
            ``(B) replacement of property; or
            ``(C) if the victim agrees, services rendered to the victim 
        or a person or organization other than the victim.
    ``(g)(1) No victim shall be required to participate in any phase of 
a restitution order.
    ``(2) A victim may at any time assign the victim's interest in 
restitution payments to the Crime Victims Fund in the Treasury without 
in any way impairing the obligation of the defendant to make such 
payments.
    ``(h) If the court finds that more than 1 defendant has contributed 
to the loss of a victim, the court may make each defendant liable for 
payment of the full amount of restitution or may apportion liability 
among the defendants to reflect the level of contribution to the 
victim's loss and economic circumstances of each defendant.
    ``(i) If the court finds that more than 1 victim has sustained a 
loss requiring restitution by a defendant, the court may issue an order 
of priority based on the type and amount of each victim's loss, 
accounting for the economic circumstances of each victim. In any case 
in which the United States is a victim, the court shall ensure that all 
individual victims receive full restitution before the United States 
receives any restitution.
    ``(j)(1) If a victim has received or is entitled to receive 
compensation with respect to a loss from insurance or any other source, 
the court shall order that restitution shall be paid to the person who 
provided or is obligated to provide the compensation, but the 
restitution order shall provide that all restitution of victims 
required by the order be paid to the victims before any restitution is 
paid to such a provider of compensation.
    ``(2) Any amount paid to a victim under an order of restitution 
shall be reduced by any amount later recovered as compensatory damages 
for the same loss by the victim in--
            ``(A) any Federal civil proceeding; and
            ``(B) any State civil proceeding, to the extent provided by 
        the law of the State.
    ``(k) A restitution order shall provide that the defendant shall 
notify the court and the Attorney General of any material change in the 
defendant's economic circumstances that might affect the defendant's 
ability to pay restitution. The court may also accept notification of a 
material change in the defendant's economic circumstances from the 
United States or from the victim. The Attorney General shall certify to 
the court that the victim or victims owed restitution by the defendant 
have been notified of the change in circumstances. Upon receipt of the 
notification, the court may, on its own motion, or the motion of any 
party, including the victim, adjust the payment schedule, or require 
immediate payment in full, as the interests of justice require.
    ``(l) A conviction of a defendant for an offense involving the act 
giving rise to an order of restitution shall estop the defendant from 
denying the essential allegations of that offense in any subsequent 
Federal civil proceeding or State civil proceeding, to the extent 
consistent with State law, brought by the victim.
    ``(m)(1)(A)(i) An order of restitution may be enforced by the 
United States in the manner provided for in subchapter C of chapter 227 
and subchapter B of chapter 229 of this title; or (ii) by all other 
available and reasonable means.
    ``(B) An order of restitution may also be enforced by a victim 
named in the order to receive the restitution, in the same manner as a 
judgment in a civil action.
    ``(2) An order of in-kind restitution in the form of services shall 
be enforced by the probation service of the court.
    ``(n) If a person obligated to provide restitution or pay a fine 
receives substantial resources from any source, including inheritance, 
settlement, or other judgment, during a period of incarceration, such 
person shall be required to apply the value of such resources to any 
restitution or fine still owed.''.
    (b) Technical Amendment.--The item relating to section 3664 in the 
analysis for chapter 232 of title 18, United States Code, is amended to 
read as follows:

``3664. Procedure for issuance and enforcement of order of 
                            restitution.''.

SEC. 306. PROCEDURE.

    (a) Amendment of Federal Rules of Criminal Procedure.--Rule 32(b) 
of the Federal Rules of Criminal Procedure is amended--
            (1) in paragraph (1), by adding at the end the following: 
        ``Notwithstanding the preceding sentence, a presentence 
        investigation and report, or other report containing 
        information sufficient for the court to enter an order of 
        restitution, as the court directs, shall be required in any 
        case in which restitution is required to be ordered.''; and
            (2) in paragraph (4)--
                    (A) by redesignating subparagraphs (F) and (G) as 
                subparagraphs (G) and (H), respectively; and
                    (B) by inserting after subparagraph (E), the 
                following new subparagraph:
                    ``(F) in appropriate cases, information sufficient 
                for the court to enter an order of restitution;''.
    (b) Fines.--Section 3572 of title 18, United States Code, is 
amended--
            (1) in subsection (b) by inserting ``other than the United 
        States,'' after ``offense,'';
            (2) in subsection (d)--
                    (A) in the first sentence, by striking ``A person 
                sentenced to pay a fine or other monetary penalty'' and 
                inserting ``(1) A person sentenced to pay a fine or 
                other monetary penalty, including restitution,'';
                    (B) by striking the third sentence; and
                    (C) by adding at the end the following:
    ``(2) If the judgment, or, in the case of a restitution order, the 
order, permits other than immediate payment, the length of time over 
which scheduled payments will be made shall be set by the court, but 
shall be the shortest time in which full payment can reasonably be 
made.
    ``(3) A judgment for a fine which permits payments in installments 
shall include a requirement that the defendant will notify the court of 
any material change in the defendant's economic circumstances that 
might affect the defendant's ability to pay the fine. Upon receipt of 
such notice the court may, on its own motion or the motion of any 
party, adjust the payment schedule, or require immediate payment in 
full, as the interests of justice require.'';
            (3) in subsection (f), by inserting ``restitution'' after 
        ``special assessment,'';
            (4) in subsection (h), by inserting ``or payment of 
        restitution'' after ``A fine''; and
            (5) in subsection (i)--
                    (A) in the first sentence, by inserting ``or 
                payment of restitution'' after ``A fine''; and
                    (B) by amending the second sentence to read as 
                follows: ``Notwithstanding any installment schedule, 
                when a fine or payment of restitution is in default, 
                the entire amount of the fine or restitution is due 
                within 30 days after notification of the default, 
                subject to the provisions of section 3613A.''.
    (c) Postsentence Administration.--
            (1) Payment of a fine or restitution.--Section 3611 of 
        title 18, United States Code, is amended--
                    (A) by amending the heading to read as follows:
``Sec. 3611. Payment of a fine or restitution''; 
                and
                    (B) by striking ``or assessment shall pay the fine 
                or assessment'' and inserting ``, assessment, or 
                restitution, shall pay the fine, assessment, or 
                restitution''.
            (2) Collection.--Section 3612 of title 18, United States, 
        is amended--
                    (A) by amending the heading to read as follows:
``Sec. 3612. Collection of unpaid fine or restitution'';
                    (B) in subsection (b)(1)--
                            (i) in the matter preceding subparagraph 
                        (A), by inserting ``or restitution order'' 
                        after ``fine'';
                            (ii) in subparagraph (C), by inserting ``or 
                        restitution order'' after ``fine'';
                            (iii) in subparagraph (E), by striking 
                        ``and'';
                            (iv) in subparagraph (F)--
                                    (I) by inserting ``or restitution 
                                order'' after ``fine''; and
                                    (II) by striking the period at the 
                                end and inserting ``; and''; and
                            (v) by adding at the end the following new 
                        subparagraph:
                    ``(G) in the case of a restitution order, 
                information sufficient to identify each victim to whom 
                restitution is owed. It shall be the responsibility of 
                each victim to notify the Attorney General, or the 
                appropriate entity of the court, by means of a form to 
                be provided by the Attorney General or the court, of 
                any change in the victim's mailing address while 
                restitution is still owed the victim. The 
                confidentiality of any information relating to a victim 
                shall be maintained.'';
                    (C) in subsection (c)--
                            (i) in the first sentence, by inserting 
                        ``or restitution'' after ``fine''; and
                            (ii) by adding at the end the following: 
                        ``Any money received from a defendant shall be 
                        disbursed so that each of the following 
                        obligations is paid in full in the following 
                        sequence:
            ``(1) A penalty assessment under section 3013 of title 18, 
        United States Code.
            ``(2) Restitution of all victims.
            ``(3) All other fines, penalties, costs, and other payments 
        required under the sentence.'';
                    (D) in subsection (d)--
                            (i) by inserting ``or restitution'' after 
                        ``fine''; and
                            (ii) by striking ``is delinquent, to inform 
                        him that the fine is delinquent'' and inserting 
                        ``or restitution is delinquent, to inform the 
                        person of the delinquency'';
                    (E) in subsection (e)--
                            (i) by inserting ``or restitution'' after 
                        ``fine''; and
                            (ii) by striking ``him that the fine is in 
                        default'' and inserting ``the person that the 
                        fine or restitution is in default'';
                    (F) in subsection (f)--
                            (i) in the heading, by inserting ``and 
                        restitution'' after ``on fines''; and
                            (ii) in paragraph (1), by inserting ``or 
                        restitution'' after ``any fine'';
                    (G) in subsection (g), by inserting ``or 
                restitution'' after ``fine'' each place it appears; and
                    (H) in subsection (i), by inserting ``and 
                restitution'' after ``fines''.
            (3) Civil remedies.--Section 3613 of title 18, United 
        States Code, is amended--
                    (A) in subsection (b), by amending paragraph (1) to 
                read as follows:
            ``(1) the later of 20 years after the entry of the judgment 
        or 20 years after the release from imprisonment of the person 
        fined or ordered to pay restitution; or''; and
                    (B) in subsection (e), by striking ``, but in no 
                event'' and all that follows through the end of the 
                subsection and inserting a period.
            (4) Default.--Chapter 229 of title 18, United States Code, 
        is amended by inserting after section 3613 the following new 
        section:
``Sec. 3613A. Effect of default
    ``(a)(1) Upon a finding that the defendant is in default on a 
payment of a fine or restitution, the court may, pursuant to section 
3565, revoke probation or a term of supervised release or modify the 
terms or conditions of probation on a term of supervised release, 
resentence a defendant pursuant to section 3614, hold the defendant in 
contempt of court, enter a restraining order or injunction, order the 
sale of property of the defendant, accept a performance bond, enter or 
adjust a payment schedule, or take any other action necessary to obtain 
compliance with the order of a fine or restitution.
    ``(2) In determining what action to take, the court shall consider 
the defendant's employment status, earning ability, financial 
resources, the willfulness in failing to comply with the restitution 
order, and any other circumstances that may have a bearing on the 
defendant's ability to comply with the order of a fine or restitution.
    ``(b)(1) Any hearing held pursuant to this section may be conducted 
by a magistrate judge, subject to de novo review by the court.
    ``(2) To the extent practicable, in a hearing held pursuant to this 
section involving a defendant who is confined in any jail, prison, or 
other correctional facility, proceedings in which the prisoner's 
participation is required or permitted shall be conducted by telephone, 
video conference, or other communications technology without removing 
the prisoner from the facility in which the prisoner is confined.
    ``(3) Subject to the agreement of the official of the Federal, 
State, or local unit of government with custody over the prisoner, 
hearings may be conducted at the facility in which the prisoner is 
confined. To the extent practicable, the court shall allow counsel to 
participate by telephone, video conference, or other communications 
technology in any hearing held at the facility.''.
            (5) Resentencing.--Section 3614 of title 18, United States 
        Code, is amended--
                    (A) in the heading, by inserting ``or restitution'' 
                after ``fine'';
                    (B) in subsection (a), by inserting ``or 
                restitution'' after ``fine''; and
                    (C) by adding at the end the following new 
                subsection:
    ``(c) Effect of Indigency.--In no event shall a defendant be 
incarcerated under this section solely on the basis of inability to 
make payments because the defendant is indigent.''.
    (d) Conforming Amendment.--The analysis for subchapter B of chapter 
229 of title 18, United States Code, is amended to read as follows:

``Sec.
``3611. Payment of a fine or restitution.
``3612. Collection of an unpaid fine or restitution.
``3613. Civil remedies for collection of an unpaid fine or restitution.
``3613A. Effect of default.
``3614. Resentencing upon failure to pay a fine or restitution.
``3615. Criminal default.''.

SEC. 307. INSTRUCTION TO SENTENCING COMMISSION.

    Pursuant to section 994 of title 28, United States Code, the United 
States Sentencing Commission shall promulgate guidelines or amend 
existing guidelines to reflect this subtitle and the amendments made by 
this subtitle.

SEC. 308. JUSTICE DEPARTMENT REGULATIONS.

    Not later than 90 days after the date of enactment of this Act, the 
Attorney General shall promulgate guidelines, or amend existing 
guidelines, to carry out this subtitle and to ensure that--
            (1) in all plea agreements negotiated by the United States, 
        consideration is given to requesting that the defendant provide 
        full restitution to all victims of all charges contained in the 
        indictment or information, without regard to the counts to 
        which the defendant actually pleaded; and
            (2) orders of restitution made pursuant to the amendments 
        made by this subtitle are enforced to the fullest extent of the 
        law.

SEC. 309. SPECIAL ASSESSMENTS ON CONVICTED PERSONS.

    Section 3013(a)(2) of title 18, United States Code, is amended--
            (1) in subparagraph (A), by striking ``$50'' and inserting 
        ``not less than $100''; and
            (2) in subparagraph (B), by striking ``$200'' and inserting 
        ``not less than $400''.

SEC. 310. CRIME VICTIMS FUND.

    (a) Prohibition of Payments to Delinquent Criminal Debtors by State 
Crime Victim Compensation Programs.--
            (1) In general.--Section 1403(b) of the Victims of Crime 
        Act of 1984 (42 U.S.C. 10602(b)) is amended--
                    (A) by striking ``and'' at the end of paragraph 
                (7);
                    (B) by redesignating paragraph (8) as paragraph 
                (9); and
                    (C) by inserting after paragraph (7) the following 
                new paragraph:
            ``(8) such program does not provide compensation to any 
        person who has been convicted of an offense under Federal law 
        with respect to any time period during which the person is 
        delinquent in paying a fine or other monetary penalty imposed 
        for the offense; and''.
            (2) Application of amendment.--The amendment made by 
        paragraph (1) shall not be applied to deny victims compensation 
        to any person until the date on which the Attorney General, in 
        consultation with the Director of the Administrative Office of 
        the United States Courts, issues a written determination that a 
        cost-effective, readily available criminal debt payment 
        tracking system operated by the agency responsible for the 
        collection of criminal debt has established cost-effective, 
        readily available communications links with entities that 
        administer Federal victims compensation programs that are 
        sufficient to ensure that victims compensation is not denied to 
        any person except as authorized by law.
    (b) Exclusion From Income for Purposes of Means Tests.--Section 
1403 of the Victims of Crime Act of 1984 (42 U.S.C. 10602) is amended 
by inserting after subsection (b) the following new subsection:
    ``(c) Exclusion From Income for Purposes of Means Tests.--
Notwithstanding any other law, for the purpose of any maximum allowed 
income eligibility requirement in any Federal, State, or local 
government program using Federal funds that provides medical or other 
assistance (or payment or reimbursement of the cost of such assistance) 
that becomes necessary to an applicant for such assistance in full or 
in part because of the commission of a crime against the applicant, as 
determined by the Director, any amount of crime victim compensation 
that the applicant receives through a crime victim compensation program 
under this section shall not be included in the income of the applicant 
until the total amount of assistance that the applicant receives from 
all such programs is sufficient to fully compensate the applicant for 
losses suffered as a result of the crime.''.

SEC. 311. VICTIMS OF TERRORISM ACT.

    (a) Authority To Provide Assistance and Compensation to Victims of 
Terrorism.--The Victims of Crime Act of 1984 (42 U.S.C. 10601 et seq.) 
is amended by inserting after section 1404A the following new section:

``SEC. 1404B. COMPENSATION AND ASSISTANCE TO VICTIMS OF TERRORISM OR 
              MASS VIOLENCE.

    ``(a) Victims of Acts of Terrorism Outside the United States.--The 
Director may make supplemental grants to States to provide compensation 
and assistance to the residents of such States who, while outside the 
territorial boundaries of the United States, are victims of a terrorist 
act or mass violence and are not persons eligible for compensation 
under title VIII of the Omnibus Diplomatic Security and Antiterrorism 
Act of 1986.
    ``(b) Victims of Domestic Terrorism.--The Director may make 
supplemental grants to States for eligible crime victim compensation 
and assistance programs to provide emergency relief, including crisis 
response efforts, assistance, training, and technical assistance, for 
the benefit of victims of terrorist acts or mass violence occurring 
within the United States and may provide funding to United States 
Attorney's Offices for use in coordination with State victims 
compensation and assistance efforts in providing emergency relief.''.
    (b) Funding of Compensation and Assistance to Victims of Terrorism, 
Mass Violence, and Crime.--Section 1402(d)(4) of the Victims of Crime 
Act of 1984 (42 U.S.C. 10601(d)(4)) is amended to read as follows:
            ``(4)(A) If the sums available in the Fund are sufficient 
        to fully provide grants to the States pursuant to section 
        1403(a)(1), the Director may retain any portion of the Fund 
        that was deposited during a fiscal year that was in excess of 
        110 percent of the total amount deposited in the Fund during 
        the preceding fiscal year as an emergency reserve. Such reserve 
        shall not exceed $50,000,000.
            ``(B) The emergency reserve may be used for supplemental 
        grants under section 1404B and to supplement the funds 
        available to provide grants to States for compensation and 
        assistance in accordance with sections 1403 and 1404 in years 
        in which supplemental grants are needed.''.
    (c) Crime Victims Fund Amendments.--
            (1) Unobligated funds.--Section 1402 of the Victims of 
        Crime Act of 1984 (42 U.S.C. 10601) is amended--
                    (A) in subsection (c), by striking ``subsection'' 
                and inserting ``chapter''; and
                    (B) by amending subsection (e) to read as follows:
    ``(e) Amounts Awarded and Unspent.--Any amount awarded as part of a 
grant under this chapter that remains unspent at the end of a fiscal 
year in which the grant is made may be expended for the purpose for 
which the grant is made at any time during the 2 succeeding fiscal 
years, at the end of which period, any remaining unobligated sums in 
excess of $500,000 shall be returned to the Treasury. Any remaining 
unobligated sums in an amount less than $500,000 shall be returned to 
the Fund.''.
            (2) Base amount.--Section 1404(a)(5) of such Act (42 U.S.C. 
        10603(a)(5)) is amended to read as follows:
            ``(5) As used in this subsection, the term `base amount' 
        means--
                    ``(A) except as provided in subparagraph (B), 
                $500,000; and
                    ``(B) for the territories of the Northern Mariana 
                Islands, Guam, American Samoa, and the Republic of 
                Palau, $200,000, with the Republic of Palau's share 
                governed by the Compact of Free Association between the 
                United States and the Republic of Palau.''.

SEC. 312. SEVERABILITY.

    If any provision of this subtitle, an amendment made by this 
subtitle, or the application of such provision or amendment to any 
person or circumstance is held to be unconstitutional, the remainder of 
this subtitle, the amendments made by this subtitle, and the 
application of the provisions of such to any person or circumstance 
shall not be affected thereby.

SEC. 313. STUDY AND REPORT.

    (a) Study.--The Attorney General, in cooperation with the Director 
of the Administrative Office of the United States Courts, shall conduct 
a study of the funds paid out of the Crime Victims Fund and the impact 
that the amendments made by this subtitle have on funds available in 
the Crime Victims Fund, including an assessment of any reduction or 
increase in fines collected and deposited into the Fund directly 
attributable to the amendments made by this subtitle.
    (b) Report.--The Attorney General and the Director of the 
Administrative Office of the United States Courts shall report interim 
findings to the Chairman and ranking Member of the Committees on the 
Judiciary of the Senate and House of Representatives 1 year after the 
date of enactment of this Act, and annually thereafter until issuing a 
final report, together with recommendations, not later than 4 years 
after the date of enactment of this Act.

SEC. 314. EFFECTIVE DATE.

    (a) In General.--Except as provided in subsection (b), the 
amendments made by this subtitle shall be effective for sentencing 
proceedings in cases in which the defendant is convicted on or after 
the date of enactment of this Act.
    (b) Crime Victims Fund.--The amendments made by sections 310 and 
311 shall take effect on the date of enactment of this Act.

                Subtitle B--Asset Forfeiture Assistance

SEC. 321. FORFEITURES UNDER THE CONTROLLED SUBSTANCES ACT.

    (a) Amendment to Controlled Substances Act.--Section 513(e)(3) of 
the Controlled Substances Act (21 U.S.C. 881(e)(3)) is amended to read 
as follows:
            ``(3)(A)(i) If the Attorney General transfers forfeited 
        property to a State or local law enforcement agency under 
        paragraph (1)(A), the Attorney General shall transfer an amount 
        equal to the value of the property that bears a reasonable 
        relationship to the degree of direct participation of the State 
        or local agency in the law enforcement effort resulting in the 
        forfeiture, taking into account the total value of all property 
        forfeited and the total law enforcement effort with respect to 
        the violation of law on which the forfeiture is based.
            ``(ii) Amounts transferred under this subparagraph shall be 
        used to encourage further cooperation between the recipient 
State or local agency and the Federal law enforcement agencies.
            ``(B)(i) The Attorney General shall transfer an additional 
        20 percent of the amount remaining after the operation of 
        subparagraph (A) to any participating local law enforcement 
        agency located within a community disproportionately impacted 
        by violent crime. Funds transferred under this subparagraph 
        shall be used for the prevention of violent crime.
            ``(ii) For purposes of this subparagraph--
                    ``(I) the term `violent crime' means a crime 
                involving force or threat of force, including murder, 
                nonnegligent manslaughter, forcible rape, robbery and 
                aggravated assault; and
                    ``(II) the term `community disproportionately 
                impacted by violent crime' means any metropolitan area, 
                city outside of a metropolitan area, or rural community 
                having a violent crime rate that is at least 2.5 times 
                the national violent crime rate for metropolitan areas, 
                cities outside of metropolitan areas, or rural 
                communities, respectively, as reported to the Federal 
                Bureau of Investigation for purposes of the Uniform 
                Crime Reports.''.
    (b) Amendment to Title 18.--Section 1963(g) of title 18, United 
States Code, is amended--
            (1) in paragraph (4), by striking ``and'';
            (2) in paragraph (5), by striking the period at the end and 
        inserting ``; and''; and
            (3) by adding at the end the following new paragraph:
            ``(6) transfer forfeited property to any State or local law 
        enforcement agency participating directly or indirectly in the 
        seizure or forfeiture of the property.''.
    (c) Amendment to the Tariff Act of 1930.--Section 616 of the Tariff 
Act of 1930 (19 U.S.C. 1616a) is amended by adding at the end the 
following new subsection:
    ``(e) Application in Forfeiture Cases Under RICO.--In the 
application of this section to asset forfeitures under section 1963 of 
title 18, United States Code, if the Attorney General transfers 
forfeited property to a State or local law enforcement agency under 
subsection (c)(1)(B), such property shall be distributed in accordance 
with the equitable sharing provisions under section 513(e)(3) of the 
Controlled Substances Act (21 U.S.C. 881(e)(3)).''.

                   TITLE IV--EDUCATIONAL OPPORTUNITY

SEC. 401. PURPOSE.

    The purpose of this title is to provide education certificates to 
low-income families in areas of high poverty to enable such families to 
select and pay for the choice school their children will attend.

SEC. 402. DEFINITIONS.

    As used in this title--
            (1) the term ``choice school'' means any public or private 
        school, including a private sectarian school or a public 
        charter school, that is involved in a demonstration project 
        under this title;
            (2) the term ``eligible child'' means a child in grades 1 
        through 12 who is eligible for free or reduced price lunches 
        under the National School Lunch Act;
            (3) the term ``eligible entity'' means a public agency, 
        institution, or organization, such as a State, a State or local 
        educational agency, a consortium of public agencies, or a 
        consortium of public and private nonprofit organizations, that 
        can demonstrate, to the satisfaction of the Secretary, its 
        ability to--
                    (A) receive, disburse, and account for Federal 
                funds; and
                    (B) carry out the activities described in its 
                application under this title;
            (4) the term ``evaluating agency'' means any academic 
        institution, consortium of professionals, or private or 
        nonprofit organization, with demonstrated experience in 
        conducting evaluations, that is not an agency or 
        instrumentality of the Federal Government;
            (5) the term ``local educational agency'' has the same 
        meaning given such term in section 14101 of the Elementary and 
        Secondary Education Act of 1965;
            (6) the term ``parent'' includes a legal guardian or other 
        individual acting in loco parentis;
            (7) the term ``school'' means a school that provides 
        elementary education or secondary education (through grade 12), 
        as determined under State law; and
            (8) the term ``Secretary'' means the Secretary of 
        Education.

SEC. 403. FUNDING.

    The Secretary shall make available $25,000,000 for each of the 
fiscal years 1996, 1997, and 1998, to carry out this title from amounts 
appropriated for such year to carry out part A of title I of the 
Elementary and Secondary Education Act of 1965 (20 U.S.C. 6311 et 
seq.).

SEC. 404. PROGRAM AUTHORIZED.

    (a) Reservation.--From the amount made available pursuant to 
section 403 for each fiscal year, the Secretary shall reserve and make 
available to the Comptroller General of the United States $1,000,000 
for the evaluations and reports required under section 410.
    (b) Grants.--
            (1) In general.--From the amount made available pursuant to 
        section 403 and not reserved under subsection (a) for any 
        fiscal year, the Secretary shall award grants to eligible 
        entities to enable such entities to carry out not less than 7 
        demonstration projects under which parents receive education 
        certificates for the costs of enrolling their eligible children 
        in a choice school.
            (2) Priority.--In awarding grants under this title, the 
        Secretary shall give priority to demonstration projects that 
        serve the greatest number of eligible children.
            (3) Continuing eligibility.--The Secretary shall continue a 
        demonstration project under this title by awarding a grant 
        under paragraph (1) to an eligible entity that received such a 
        grant for a fiscal year preceding the fiscal year for which the 
        determination is made, if the Secretary determines that such 
        eligible entity was in compliance with this title for such 
        preceding fiscal year.
    (c) Use of Grants.--Grants awarded under subsection (b) shall be 
used to pay the costs of providing education certificates to parents to 
enable such parents to pay the tuition, the fees, the allowable costs 
of transportation, if any, and the costs of complying with section 
408(a)(1), if any, for their eligible children to attend a choice 
school.
    (d) Special Rule.--Each school participating in a demonstration 
project under this title shall comply with title VI of the Civil Rights 
Act of 1964 which prohibits discrimination on the basis of race, color, 
or national origin.

SEC. 405. AUTHORIZED PROJECTS.

    The Secretary may award a grant under this title only for a 
demonstration project that--
            (1) involves at least one local educational agency that--
                    (A) receives funds under section 1124A of the 
                Elementary and Secondary Education Act of 1965; and
                    (B) is among the 20 percent of local educational 
                agencies receiving funds under section 1124A of such 
                Act in the State that have the highest number of 
                children described in section 1124(c) of such Act; and
            (2) includes the involvement of a sufficient number of 
        public and private choice schools, in the judgment of the 
        Secretary, to allow for a valid demonstration project.

SEC. 406. APPLICATIONS.

    (a) In General.--Any eligible entity that wishes to receive a grant 
for a demonstration project under this title shall submit an 
application to the Secretary at such time and in such manner as the 
Secretary may prescribe.
    (b) Contents.--Each application described in subsection (a) shall 
contain--
            (1) a description of how the eligible entity will annually 
        determine the number of spaces available for eligible children 
        in each choice school participating in the demonstration 
        project;
            (2) a description of each choice school participating in 
        the demonstration project, including a description of the 
        distances and costs associated with commuting to each such 
        choice school;
            (3) a description of the estimated costs to eligible 
        students for tuition, fees, and transportation, at each choice 
        school participating in the demonstration project;
            (4) a description of the process to be used when the number 
        of parents provided education certificates under this title who 
        desire to enroll their eligible children in a particular choice 
        school participating in the demonstration project exceeds the 
        number of eligible children that such choice school will 
        accept;
            (5) a description of the procedures to be used for the 
        issuance and redemption of education certificates under this 
        title;
            (6) an assurance the eligible entity will submit to the 
        evaluating agency entering into the contract under section 
        410(a) an annual report, at such time, in such manner, and 
        accompanied by such information as such evaluating agency may 
        require, describing the activities and expenditures of such 
        eligible entity under the demonstration project; and
            (7) such other assurances and information as the Secretary 
        may require.

SEC. 407. EDUCATION CERTIFICATES.

    (a) Education Certificates.--
            (1) Amount.--The amount of an eligible child's education 
        certificate under this title shall be determined by the 
eligible entity, but shall be an amount that provides to the recipient 
of the education certificate the maximum degree of choice in selecting 
the choice school the eligible child will attend.
            (2) Considerations.--
                    (A) In general.--Subject to such regulations as the 
                Secretary shall prescribe, in determining the amount of 
                an education certificate under this title an eligible 
                entity shall consider--
                            (i) the additional reasonable costs of 
                        transportation directly attributable to the 
                        eligible child's participation in the 
                        demonstration project; and
                            (ii) the cost of complying with section 
                        408(a)(1).
                    (B) Schools charging tuition.--If an eligible child 
                participating in a demonstration project under this 
                title was attending a public or private school that 
                charged tuition for the year preceding the first year 
                of such participation, then in determining the amount 
                of an education certificate for such eligible child 
                under this title the eligible entity shall consider--
                            (i) the tuition charged by such school for 
                        such eligible child in such preceding year; and
                            (ii) the amount of the education 
                        certificates under this title that are provided 
                        to other eligible children.
            (3) Special rule.--An eligible entity may provide an 
        education certificate under this title to the parent of an 
        eligible child who chooses to attend a school that does not 
        charge tuition or fees, to pay the additional reasonable costs 
        of transportation directly attributable to the eligible child's 
        participation in the demonstration project or the cost of 
        complying with section 408(a)(1).
    (b) Adjustment.--The amount of the education certificate for a 
fiscal year may be adjusted in the second and third years of an 
eligible child's participation in a demonstration project under this 
title to reflect any increase or decrease in the tuition, fees, or 
transportation costs directly attributable to that eligible child's 
continued attendance at a choice school, but shall not be increased for 
this purpose by more than 10 percent of the amount of the education 
certificate for the fiscal year preceding the fiscal year for which the 
determination is made. The amount of the education certificate may also 
be adjusted in any fiscal year to comply with section 408(a)(1).
    (c) Maximum Amount.--Notwithstanding any other provision of this 
section, the amount of an eligible child's education certificate shall 
not exceed the per pupil expenditure for elementary or secondary 
education, as appropriate, by the local educational agency in which the 
public school to which the eligible child would normally be assigned is 
located for the fiscal year preceding the fiscal year for which the 
determination is made.
    (d) Income.--An education certificate under this title, and funds 
provided under the education certificate, shall not be treated as 
income of the parents for purposes of Federal tax laws or for 
determining eligibility for any other Federal program.

SEC. 408. EFFECT ON OTHER PROGRAMS; USE OF SCHOOL LUNCH DATA.

    (a) Effect on Other Programs.--
            (1) In general.--An eligible child participating in a 
        demonstration project under this title, who, in the absence of 
        such a demonstration project, would have received services 
        under part A of title I of the Elementary and Secondary 
        Education Act of 1965 shall be provided such services.
            (2) Part b of the individuals with disabilities education 
        act.--Nothing in this title shall be construed to affect the 
        requirements of part B of the Individuals with Disabilities 
        Education Act.
    (b) Counting of Eligible Children.--Notwithstanding any other 
provision of law, any local educational agency participating in a 
demonstration project under this title may count eligible children who, 
in the absence of such a demonstration project, would attend the 
schools of such agency, for purposes of receiving funds under any 
program administered by the Secretary.
    (c) Special Rule.--Notwithstanding section 9 of the National School 
Lunch Act, an eligible entity receiving a grant under this title may 
use information collected for the purpose of determining eligibility 
for free or reduced price lunches to determine an eligible child's 
eligibility to participate in a demonstration project under this title. 
All such information shall otherwise remain confidential, and 
information pertaining to income may be disclosed only to persons who 
need that information for the purposes of a demonstration project under 
this title.
    (d) Construction.--
            (1) Other institutions.--Nothing in this title shall be 
        construed to supersede or modify any provision of a State 
        constitution or State law that prohibits the expenditure of 
public funds in or by religious or other private institutions, except 
that no provision of a State constitution or State law shall be 
construed or applied to prohibit--
                    (A) any eligible entity receiving funds under this 
                title from using such funds to pay the administrative 
                costs of a demonstration project under this title; or
                    (B) the expenditure in or by religious or other 
                private institutions of any Federal funds provided 
                under this title.
            (2) Desegregation plans.--Nothing in this title shall be 
        construed to interfere with any desegregation plans that 
        involve school attendance areas affected by this title.

SEC. 409. PARENTAL NOTIFICATION.

    Each eligible entity receiving a grant under this title shall 
provide timely notice of the demonstration project to parents of 
eligible children residing in the area to be served by the 
demonstration project. At a minimum, such notice shall--
            (1) describe the demonstration project;
            (2) describe the eligibility requirements for participation 
        in the demonstration project;
            (3) describe the information needed to make a determination 
        of eligibility for participation in the demonstration project 
        for an eligible child;
            (4) describe the selection procedures to be used if the 
        number of eligible children seeking to participate in the 
        demonstration project exceeds the number that can be 
        accommodated in the demonstration project;
            (5) provide information about each choice school 
        participating in the demonstration project, including 
        information about any admission requirements or criteria for 
        each such choice school; and
            (6) include the schedule for parents to apply for their 
        eligible children to participate in the demonstration project.

SEC. 410. EVALUATION AND REPORT.

    (a) Evaluation.--The Comptroller General of the United States shall 
enter into a contract with an evaluating agency for the conduct of an 
ongoing evaluation of each demonstration project assisted under this 
title.
    (b) Report.--The evaluating agency entering into a contract under 
subsection (a) annually shall report to the Congress regarding the 
evaluations conducted under such subsection.

                      TITLE V--FAMILY OPPORTUNITY

SEC. 501. FINDINGS AND PURPOSE.

    (a) Findings.--Congress finds that--
            (1) nearly 500,000 children are in foster care in the 
        United States;
            (2) tens of thousands of children in foster care are 
        waiting for adoption;
            (3) 2 years and 8 months is the median length of time that 
        children wait to be adopted, and minority children often wait 
        twice as long as other children to be adopted; and
            (4) child welfare agencies should work to eliminate racial, 
        ethnic, and national origin discrimination and bias in adoption 
        and foster care recruitment, selection, and placement 
        procedures.
    (b) Purpose.--The purpose of this title is to promote the best 
interests of children by--
            (1) decreasing the length of time that children wait to be 
        adopted; and
            (2) preventing discrimination in the placement of children 
        on the basis of race, color, or national origin.

SEC. 502. REMOVAL OF BARRIERS TO INTERRACIAL AND INTERETHNIC ADOPTIONS.

    (a) Prohibition.--A State or other entity that receives funds from 
the Federal Government and is involved in adoption or foster care 
placements may not--
            (1) deny to any person the opportunity to become an 
        adoptive or a foster parent, on the basis of the race, color, 
        or national origin of the person, or of the child, involved; or
            (2) delay or deny the placement of a child for adoption or 
        into foster care, or otherwise discriminate in making a 
        placement decision, on the basis of the race, color, or 
        national origin of the adoptive or foster parent, or the child, 
        involved.
    (b) Penalties.--
            (1) State violators.--A State that violates subsection (a) 
        shall remit to the Secretary of Health and Human Services all 
        funds that were paid to the State under part E of title IV of 
        the Social Security Act (42 U.S.C. 670 et seq.) (relating to 
        foster care and adoption assistance) during the period of the 
        violation.
            (2) Private violators.--Any other entity that violates 
        subsection (a) shall remit to the Secretary of Health and Human 
        Services all funds that were paid to the entity during the 
        period of the violation by a State from funds provided under 
        part E of title IV of the Social Security Act.
    (c) Private Cause of Action.--
            (1) In general.--Any individual or class of individuals 
        aggrieved by a violation of subsection (a) by a State or other 
        entity may bring an action seeking relief in any United States 
        district court or State court of appropriate jurisdiction.
            (2) Statute of limitations.--An action under this 
        subsection may not be brought more than 2 years after the date 
        the alleged violation occurred.
    (d) Attorney's Fees.--In any action or proceeding under this title, 
the court, in the discretion of the court, may allow the prevailing 
party, other than the United States, a reasonable attorney's fee, 
including litigation expenses and costs, and the States and the United 
States shall be liable for the fee to the same extent as a private 
individual.
    (e) State Immunity.--A State shall not be immune under the 11th 
amendment to the Constitution from an action in Federal or State court 
of appropriate jurisdiction for a violation of this title.
    (f) No Effect on Indian Child Welfare Act of 1978.--Nothing in this 
title shall be construed to affect the application of the Indian Child 
Welfare Act of 1978 (25 U.S.C. 1901 et seq.).

SEC. 503. REPEAL.

    Subpart 1 of part E of title V of the Improving America's Schools 
Act of 1994 (42 U.S.C. 5115a) is amended--
            (1) by repealing sections 551 through 553; and
            (2) by redesignating section 554 as section 551.

SEC. 504. EFFECTIVE DATE.

    This title, and the amendments made by this title, shall take 
effect 90 days after the date of enactment of this Act.

                     TITLE VI--VOLUNTEER PROTECTION

SEC. 601. FINDINGS AND PURPOSE.

    (a) Findings.--Congress finds that--
            (1) the willingness of volunteers to offer their services 
        is deterred by potential personal liability for simple mistakes 
        made in the course of volunteer service;
            (2) as a result, many nonprofit public and private 
        organizations and governmental entities, including voluntary 
        associations, social service agencies, educational 
        institutions, local governments, foundations, and other civic 
        programs, have been adversely affected through the withdrawal 
        of volunteers from boards of directors and service in other 
        capacities;
            (3) the contribution of such programs to the communities 
        served by the programs is diminished by the withdrawal of 
        volunteers, resulting in fewer and higher cost programs than 
        would be obtainable if the volunteers were participating; and
            (4) because Federal funds are expended on useful and cost-
        effective social service programs that depend heavily on 
        volunteer participation, protection of voluntarism through 
        clarification and limitation of the personal liability risks 
        assumed by a volunteer in connection with such participation is 
        an appropriate subject for Federal encouragement of State 
        reform.
    (b) Purpose.--It is the purpose of this title to promote the 
interests of social service program beneficiaries and taxpayers and to 
sustain the availability of programs, nonprofit organizations, and 
governmental entities, that depend on volunteer contributions by 
encouraging reasonable reform of State laws to provide protection from 
personal financial liability to volunteers serving with such 
organizations and entities for actions undertaken in good faith on 
behalf of such organizations and entities.

SEC. 602. DEFINITIONS.

    As used in this title:
            (1) Damage or injury.--The term ``damage or injury'' 
        includes physical, nonphysical, economic, and noneconomic 
        damage.
            (2) Nonprofit organization.--The term ``nonprofit 
        organization'' means an organization described in section 
        501(c) of the Internal Revenue Code of 1986 and exempt from tax 
        under section 501(a) of such Code.
            (3) State.--The term ``State'' means each of the several 
        States, the District of Columbia, the Commonwealth of Puerto 
        Rico, the United States Virgin Islands, Guam, American Samoa, 
        the Commonwealth of the Northern Mariana Islands, any other 
        territory or possession of the United States, or any political 
        subdivision of any such State, territory, or possession.
            (4) Volunteer.--The term ``volunteer'' means an individual 
        who--
                    (A) performs services (including serving as a 
                director, officer, or trustee or providing direct 
                services) for a nonprofit organization or a 
                governmental entity; and
                    (B) does not receive--
                            (i) compensation (including reimbursement 
                        or allowance for expenses) in excess of $300 
                        for such services; or
                            (ii) any other thing of value (in lieu of 
                        compensation) in excess of $300 for such 
                        services.

SEC. 603. NO PREEMPTION OF STATE TORT LAW.

    Nothing in this title shall be construed to preempt the laws of any 
State governing tort liability actions.

SEC. 604. LIMITATION ON LIABILITY FOR VOLUNTEERS.

    (a) Liability Protection for Volunteers.--Except as provided in 
subsections (b) and (d), no volunteer for a nonprofit organization or 
governmental entity shall incur any personal financial liability for 
any tort claim alleging damage or injury from any act or omission of 
the volunteer on behalf of the organization or entity if--
            (1) such volunteer was acting in good faith and within the 
        scope of the official functions and duties of the volunteer 
        with the organization or entity; and
            (2) such damage or injury was not caused by willful and 
        wanton misconduct by such volunteer.
    (b) Concerning Responsibility of Volunteers With Respect to 
Organizations.--Nothing in this section shall be construed to affect 
any civil action brought by any nonprofit organization or any 
governmental entity against any volunteer for such organization or 
entity.
    (c) No Effect on Liability of Organization.--Nothing in this 
section shall be construed to affect the liability of any nonprofit 
organization or governmental entity with respect to injury caused to 
any person.
    (d) Exceptions to Volunteer Liability Protection.--A State may 
impose 1 or more of the following conditions on and exceptions to the 
granting of liability protection to any volunteer for an organization 
or entity as required by subsection (a):
            (1) Procedures.--The organization or entity shall follow 
        risk management procedures, including mandatory training of 
        volunteers, as defined by the Secretary of Health and Human 
        Services by regulation.
            (2) Liability of organization or entity.--The organization 
        or entity shall be liable for the acts or omissions of 
        volunteers for the organization or entity to the same extent as 
        an employer is liable, under the laws of that State, for the 
        acts or omissions of the employees of the employer.
            (3) Exceptions.--The protection from liability shall not 
        apply to an act or omission of a volunteer--
                    (A) if, at the time of the act or omission, the 
                volunteer was operating a motor vehicle, vessel, 
                aircraft, or other vehicle for which the State involved 
                requires the operator or vehicle owner to maintain 
                insurance;
                    (B) in the case of a suit relating to the act or 
                omission brought by an appropriate officer of a State 
                or local government to enforce a Federal, State, or 
                local law; and
                    (C) to the extent a claim relating to the act or 
                omission would be covered under any insurance policy.
            (4) Source of recovery.--The protection from liability 
        shall apply only if the organization or entity provides a 
        financially secure source of recovery for individuals who 
        suffer injury as a result of acts or omissions by a volunteer 
        on behalf of the organization or entity. For purposes of this 
        paragraph, a financially secure source of recovery may be an 
        insurance policy within specified limits, comparable coverage 
        from a risk pooling mechanism, equivalent assets, or an 
        alternative arrangement that satisfies the State that the 
        entity will be able to pay for losses up to a specified amount. 
        In specifying standards for such a source, the State may 
        specify separate standards for different types of liability 
        exposure.

SEC. 605. CERTIFICATION REQUIREMENT AND ADJUSTMENT OF SOCIAL SERVICES 
              BLOCK GRANT ALLOTMENTS.

    (a) Certification and Block Grant Allotments.--In the case of any 
State that certifies, not later than 2 years after the date of the 
enactment of this Act, to the Secretary of Health and Human Services 
that the State has enacted, has adopted, or otherwise has in effect 
State law which substantially complies with section 604(a), the 
Secretary shall increase by 1 percent the fiscal year allotment that 
would otherwise be made to such State to carry out the social services 
block grant program under title XX of the Social Security Act (42 
U.S.C. 1397 et seq.).
    (b) Continuation of Increase.--Any increase made under subsection 
(a) in an allotment to a State shall remain in effect only if the State 
makes a certification described in subsection (a) to the Secretary of 
Health and Human Services by such day and by the end of each 1-year 
period after such day, for 1 year after the date of the most recent 
certification.

                      TITLE VII--SPECTRUM AUCTION

SEC. 701. AUCTION OF ELECTROMAGNETIC SPECTRUM.

    (a) Repeal of Existing Authority To Allocate Spectrum.--(1) 
Subsections (i) and (j) of section 309 of the Communications Act of 
1934 (47 U.S.C. 309) are repealed.
    (2) No regulation prescribed by the Federal Communications 
Commission under the authority set forth in such subsection (i) or (j), 
or under any other provision of law authorizing the Commission to 
prescribe regulations for the grant of licenses or permits for the use 
of the electromagnetic spectrum, shall have any further force or effect 
after the date of the enactment of this Act.
    (b) Grant of Licenses and Permits by Competitive Bidding.--Such 
section is further amended by adding at the end the following:
    ``(i) Requirement for Competitive Bidding.--
            ``(1) Requirement.--Except as provided in paragraph (2), 
        the Commission shall grant a license or construction permit 
        involving the use of a portion of the electromagnetic spectrum 
        not covered by a license or permit granted before the date of 
        the enactment of the Balanced Budget Reconciliation Act of 1995 
        only through the use of a system of competitive bidding 
        established by the Commission.
            ``(2) Exceptions.--
                    ``(A) In general.--Subject to subparagraphs (B) and 
                (C), the Commission may grant a license or permit 
                covered this subsection--
                            ``(i) by alternative adjudication;
                            ``(ii) without a fee; or
                            ``(iii) for a nominal fee.
                    ``(B) Term of low-fee licenses and permits.--The 
                term of a license granted under clause (ii) of 
                subparagraph (A) or a permit granted under clause (iii) 
                of that subparagraph may not exceed 10 years, except 
                that the Commission may permit the renewal of the 
                license or permit for an additional period of 10 years.
                    ``(C) Notice and wait requirement.--The Commission 
                may not grant a license or permit under this paragraph 
                until 120 days after the date on which the Commission 
                submits to the Committee on Commerce, Science, and 
                Transportation of the Senate and the Committee on 
                Commerce of the House of Representatives a notice of 
                the intent of the Commission to so grant the license or 
                permit.
                    ``(D) Contents of notice.--Each notice submitted 
                under subparagraph (C) shall include the following:
                            ``(i) A justification for the decision to 
                        grant the license or permit in question under 
                        this paragraph.
                            ``(ii) An estimate of the revenue that the 
                        United States will forgo as a result of the 
                        grant of the license or permit under this 
                        paragraph.
                            ``(iii) An explanation of the manner in 
                        which the license or permit will be granted.
                            ``(iv) If the license or permit will be 
                        granted under clause (ii) or (iii) of 
                        subparagraph (A), an explanation why the grant 
                        of the license or permit under such clause will 
                        be more beneficial to the public interest than 
                        the grant of the license or permit under 
                        paragraph (1).''.
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