[Congressional Bills 105th Congress]
[From the U.S. Government Publishing Office]
[S. 2286 Placed on Calendar Senate (PCS)]





                                                       Calendar No. 462

105th CONGRESS

  2d Session

                                S. 2286

                          [Report No. 105-243]

_______________________________________________________________________

                                 A BILL

 To amend the National School Lunch Act and the Child Nutrition Act of 
 1966 to provide children with increased access to food and nutrition 
    assistance, to simplify program operations and improve program 
   management, to extend certain authorities contained in those Acts 
           through fiscal year 2003, and for other purposes.

_______________________________________________________________________

                             July 10, 1998

                 Read twice and placed on the calendar





                                                       Calendar No. 462
105th CONGRESS
  2d Session
                                S. 2286

                          [Report No. 105-243]

 To amend the National School Lunch Act and the Child Nutrition Act of 
 1966 to provide children with increased access to food and nutrition 
    assistance, to simplify program operations and improve program 
   management, to extend certain authorities contained in those Acts 
           through fiscal year 2003, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 10, 1998

Mr. Lugar, from the Committee on Agriculture, Nutrition, and Forestry, 
 reported the following original bill; which was read twice and placed 
                            on the calendar

_______________________________________________________________________

                                 A BILL


 
 To amend the National School Lunch Act and the Child Nutrition Act of 
 1966 to provide children with increased access to food and nutrition 
    assistance, to simplify program operations and improve program 
   management, to extend certain authorities contained in those Acts 
           through fiscal year 2003, 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.

    (a) Short Title.--This Act may be cited as the ``Child Nutrition 
and WIC Reauthorization Amendments of 1998''.
    (b) Table of Contents.--The table of contents of this Act is as 
follows:

Sec. 1. Short title; table of contents.
               TITLE I--SCHOOL LUNCH AND RELATED PROGRAMS

Sec. 101. Technical amendments to commodity provisions.
Sec. 102. Waiver of requirement for weighted averages for nutrient 
                            analysis.
Sec. 103. Requirement for food safety inspections.
Sec. 104. Elimination of administration of programs by regional 
                            offices.
Sec. 105. Special assistance.
Sec. 106. Adjustments to payment rates.
Sec. 107. Adjustments to reimbursement rates.
Sec. 108. Criminal penalties.
Sec. 109. Food and nutrition projects.
Sec. 110. Establishment of an adequate meal service period.
Sec. 111. Buy American.
Sec. 112. Procurement contracts.
Sec. 113. Summer food service program for children.
Sec. 114. Commodity distribution program.
Sec. 115. Child and adult care food program.
Sec. 116. Transfer of homeless assistance programs to child and adult 
                            care food program.
Sec. 117. Meal supplements for children in afterschool care.
Sec. 118. Pilot projects.
Sec. 119. Breakfast pilot projects.
Sec. 120. Training and technical assistance.
Sec. 121. Food service management institute.
Sec. 122. Compliance and accountability.
Sec. 123. Information clearinghouse.
Sec. 124. Refocusing of effort to help accommodate the special dietary 
                            needs of individuals with disabilities.
            TITLE II--SCHOOL BREAKFAST AND RELATED PROGRAMS

Sec. 201. Elimination of administration of programs by regional 
                            offices.
Sec. 202. State administrative expenses.
Sec. 203. Special supplemental nutrition program for women, infants, 
                            and children.
Sec. 204. Nutrition education and training.
               TITLE III--COMMODITY DISTRIBUTION PROGRAMS

Sec. 301. Commodity distribution program reforms.
Sec. 302. Food distribution.
                        TITLE IV--EFFECTIVE DATE

Sec. 401. Effective date.

               TITLE I--SCHOOL LUNCH AND RELATED PROGRAMS

SEC. 101. TECHNICAL AMENDMENTS TO COMMODITY PROVISIONS.

    (a) In General.--Section 6 of the National School Lunch Act (42 
U.S.C. 1755) is amended--
            (1) by striking subsections (c) and (d); and
            (2) by redesignating subsections (e), (f), and (g) as 
        subsections (c), (d), and (e), respectively.
    (b) Conforming Amendments.--The National School Lunch Act is 
amended by striking ``section 6(e)'' each place it appears in sections 
14(f), 16(a), and 17(h)(1)(B) (42 U.S.C. 1762a(f), 1765(a), 
1766(h)(1)(B)) and inserting ``section 6(c)''.

SEC. 102. WAIVER OF REQUIREMENT FOR WEIGHTED AVERAGES FOR NUTRIENT 
              ANALYSIS.

    Section 9(f) of the National School Lunch Act (42 U.S.C. 1758(f)) 
is amended by adding at the end the following:
            ``(5) Waiver of requirement for weighted averages for 
        nutrient analysis.--During the period ending on September 30, 
        2003, the Secretary shall not require the use of weighted 
        averages for nutrient analysis of menu items and foods offered 
        or served as part of a reimbursable meal under the school lunch 
        or school breakfast program.''.

SEC. 103. REQUIREMENT FOR FOOD SAFETY INSPECTIONS.

    Section 9 of the National School Lunch Act (42 U.S.C. 1758) is 
amended by adding at the end the following:
    ``(h) Food Safety Inspections.--
            ``(1) In general.--Except as provided in paragraph (2), a 
        school participating in the school lunch program authorized 
        under this Act or the school breakfast program authorized under 
        section 4 of the Child Nutrition Act of 1966 (42 U.S.C. 1773) 
        shall, at least once during each school year, obtain a food 
        safety inspection conducted by a State or local governmental 
        agency responsible for food safety inspections.
            ``(2) Exception.--Paragraph (1) shall not apply to a school 
        if a food safety inspection of the school is required by a 
        State or local authority.''.

SEC. 104. ELIMINATION OF ADMINISTRATION OF PROGRAMS BY REGIONAL 
              OFFICES.

    (a) In General.--Section 10 of the National School Lunch Act (42 
U.S.C. 1759) is amended to read as follows:

``SEC. 10. DISBURSEMENT TO SCHOOLS BY THE SECRETARY.

    ``(a) Authority To Administer Programs.--
            ``(1) In general.--Except as provided in paragraph (3), 
        during the period determined under subsection (c), the 
        Secretary shall withhold funds payable to a State under this 
        Act and disburse the funds directly to school food authorities, 
        institutions, and service institutions within the State for the 
        purposes authorized by this Act to the extent that the 
        Secretary has so withheld and disbursed the funds continuously 
        since October 1, 1980.
            ``(2) Use of funds.--Any funds withheld and disbursed by 
        the Secretary under paragraph (1) shall be used for the same 
        purposes and be subject to the same conditions as apply to 
        disbursing funds made available to States under this Act.
            ``(3) State administration.--If the Secretary is 
        administering (in whole or in part) any program authorized 
        under this Act in a State, the State may, on request to the 
        Secretary, assume administrative responsibility for the program 
        at any time during the period determined under subsection (c).
    ``(b) Provision of Training and Technical Assistance.--During the 
period determined under subsection (c), the Secretary shall provide a 
State that assumes administrative responsibility for a program from the 
Secretary with training and technical assistance to allow for an 
efficient and effective transfer of the responsibility.
    ``(c) Period.--
            ``(1) In general.--Except as provided in paragraph (2), 
        this section shall apply during the period beginning on October 
        1, 1998, and ending on September 30, 2001.
            ``(2) Extension.--The Secretary may extend the period 
        described in paragraph (1) that applies to a program 
        administered by the Secretary for a State, for a period not to 
        exceed 2 years, if the State--
                    ``(A) demonstrates to the Secretary that the State 
                will not be able to assume administrative 
                responsibility for the program during the period 
                described in paragraph (1); and
                    ``(B) submits a plan to the Secretary that 
                describes when and how the State will assume 
                administrative responsibility for the program.''.
    (b) Conforming Amendments.--
            (1) Section 7(b) of the National School Lunch Act (42 
        U.S.C. 1756(b)) is amended in the second sentence by striking 
        ``No'' and inserting ``During the period determined under 
        section 10(c), no''.
            (2) Section 11(a)(1)(A) of the National School Lunch Act 
        (42 U.S.C. 1759a(a)(1)(A)) is amended by inserting after 
        ``section 10 of this Act'' the following: ``(during the period 
        determined under section 10(c))''.

SEC. 105. SPECIAL ASSISTANCE.

    Section 11(a)(1) of the National School Lunch Act (42 U.S.C. 
1759a(a)(1)) is amended--
            (1) in subparagraph (C)--
                    (A) in clause (i)(I), by striking ``3 successive 
                school years'' each place it appears and inserting ``4 
                successive school years''; and
                    (B) in clauses (ii) and (iii), by striking ``3-
                school-year period'' each place it appears and 
                inserting ``4-school-year period''; and
            (2) in subparagraph (D)--
                    (A) in clause (i)--
                            (i) by striking ``3-school-year period'' 
                        each place it appears and inserting ``4-school-
                        year period''; and
                            (ii) by striking ``2 school years'' and 
                        inserting ``4 school years'';
                    (B) in clause (ii)--
                            (i) by striking the first sentence; and
                            (ii) by striking ``5-school-year period'' 
                        each place it appears and inserting ``4-school-
                        year period''; and
                    (C) in clause (iii), by striking ``5-school-year 
                period'' and inserting ``4-school-year period''.

SEC. 106. ADJUSTMENTS TO PAYMENT RATES.

    (a) In General.--Section 11(a)(3)(B) of the National School Lunch 
Act (42 U.S.C. 1759a(a)(3)(B)) is amended--
            (1) by striking ``(B) The annual'' and inserting the 
        following:
                    ``(B) Computation of adjustment.--
                            ``(i) In general.--The annual'';
            (2) by striking ``Each annual'' and inserting the 
        following:
                            ``(ii) Basis.--Each annual'';
            (3) by striking ``The adjustments'' and inserting the 
        following:
                            ``(iii) Rounding.--
                                    ``(I) Through april 30, 1999.--For 
                                the period ending April 30, 1999, the 
                                adjustments''; and
            (4) by adding at the end the following:
                                    ``(II) May 1, 1999, through june 
                                30, 1999.--For the period beginning on 
                                May 1, 1999, and ending on June 30, 
                                1999, the national average payment 
                                rates for meals and supplements shall 
                                be adjusted to the nearest lower cent 
                                increment and shall be based on the 
                                unrounded amounts used to calculate the 
                                rates in effect on July 1, 1998.
                                    ``(III) July 1, 1999, and 
                                thereafter.--On July 1, 1999, and on 
                                each subsequent July 1, the national 
                                average payment rates for meals and 
                                supplements shall be adjusted to the 
                                nearest lower cent increment and shall 
                                be based on the unrounded amounts for 
                                the preceding 12-month period.''.
    (b) Conforming Amendments.--Section 4(b) of the Child Nutrition Act 
of 1966 (42 U.S.C. 1773(b)) is amended--
            (1) in the second sentence of paragraph (1)(B), by striking 
        ``adjusted to the nearest one-fourth cent,''; and
            (2) in paragraph (2)(B)(ii), by striking ``to the nearest 
        one-fourth cent''.

SEC. 107. ADJUSTMENTS TO REIMBURSEMENT RATES.

    Section 12 of the National School Lunch Act (42 U.S.C. 1760) is 
amended by striking subsection (f) and inserting the following:
    ``(f) Adjustments to Reimbursement Rates.--In providing assistance 
for breakfasts, lunches, suppers, and supplements served in Alaska, 
Hawaii, Guam, American Samoa, Puerto Rico, the Virgin Islands, and the 
Commonwealth of the Northern Mariana Islands, the Secretary may 
establish appropriate adjustments for each such State to the national 
average payment rates prescribed under sections 4, 11, 13 and 17 of 
this Act and section 4 of the Child Nutrition Act of 1966 (42 U.S.C. 
1773) to reflect the differences between the costs of providing meals 
in those States and the costs of providing meals in all other 
States.''.

SEC. 108. CRIMINAL PENALTIES.

    Section 12(g) of the National School Lunch Act (42 U.S.C. 1760(g)) 
is amended by striking ``$10,000'' and inserting ``$25,000''.

SEC. 109. FOOD AND NUTRITION PROJECTS.

    Section 12(m) of the National School Lunch Act (42 U.S.C. 1760(m)) 
is amended by striking ``1998'' each place it appears and inserting 
``2003''.

SEC. 110. ESTABLISHMENT OF AN ADEQUATE MEAL SERVICE PERIOD.

    Section 12 of the National School Lunch Act (42 U.S.C. 1760) is 
amended by adding at the end the following:
    ``(n) Length of Meal Service Period and Food Service Environment.--
A school participating in the school lunch program authorized under 
this Act or the school breakfast program authorized under section 4 of 
the Child Nutrition Act of 1966 (42 U.S.C. 1773) is encouraged to 
establish meal service periods that provide children with adequate time 
to fully consume their meals in an environment that is conducive to 
eating the meals.''.

SEC. 111. BUY AMERICAN.

    Section 12 of the National School Lunch Act (42 U.S.C. 1760) (as 
amended by section 110) is amended by adding at the end the following:
    ``(o) Buy American.--
            ``(1) Definition of domestic commodity or product.--In this 
        subsection, the term `domestic commodity or product' means--
                    ``(A) an agricultural commodity that is produced in 
                the United States; and
                    ``(B) a food product that is processed in the 
                United States substantially using agricultural 
                commodities that are produced in the United States.
            ``(2) Requirement.--Subject to paragraph (3), the Secretary 
        shall require that a school purchase, to the maximum extent 
        practicable, domestic commodities or products.
            ``(3) Limitations.--Paragraph (2) shall apply only to--
                    ``(A) a school located in the contiguous United 
                States; and
                    ``(B) a purchase of an agricultural commodity or 
                product for the school lunch program authorized under 
                this Act or the school breakfast program authorized 
                under section 4 of the Child Nutrition Act of 1966 (42 
                U.S.C. 1773).''.

SEC. 112. PROCUREMENT CONTRACTS.

    Section 12 of the National School Lunch Act (42 U.S.C. 1760) (as 
amended by section 111) is amended by adding at the end the following:
    ``(p) Procurement Contracts.--In acquiring a good or service using 
funds provided under this Act or the Child Nutrition Act of 1966 (42 
U.S.C. 1771 et seq.), a State, State agency, or school may enter into a 
contract with a person that has provided assistance to the State, State 
agency, or school in drafting contract specifications.''.

SEC. 113. SUMMER FOOD SERVICE PROGRAM FOR CHILDREN.

    (a) Establishment of Site Limitation.--Section 13(a)(7)(B) of the 
National School Lunch Act (42 U.S.C. 1761(a)(7)(B)) is amended by 
striking clause (i) and inserting the following:
            ``(i) operate--
                    ``(I) not more than 25 sites, with not more than 
                300 children being served at any 1 site; or
                    ``(II) with a waiver granted by the State agency 
                under standards developed by the Secretary, with not 
                more than 500 children being served at any 1 site;''.
    (b) Elimination of Indication of Interest Requirement, Removal of 
Meal Contracting Restrictions, and Vendor Registration Requirements.--
Section 13 of the National School Lunch Act (42 U.S.C. 1761) is 
amended--
            (1) in subsection (a)(7)(B)--
                    (A) by striking clauses (ii) and (iii); and
                    (B) by redesignating clauses (iv) through (vii) as 
                clauses (ii) through (v) respectively; and
            (2) in subsection (l)--
                    (A) in paragraph (1)--
                            (i) in the first sentence--
                                    (I) by striking ``(other than 
                                private nonprofit organizations 
                                eligible under subsection (a)(7))''; 
                                and
                                    (II) by striking ``only with food 
                                service management companies registered 
                                with the State in which they operate'' 
                                and inserting ``with food service 
                                management companies''; and
                            (ii) by striking the last sentence;
                    (B) in paragraph (2)--
                            (i) in the first sentence, by striking 
                        ``shall'' and inserting ``may''; and
                            (ii) by striking the second and third 
                        sentences;
                    (C) by striking paragraph (3); and
                    (D) by redesignating paragraphs (4) and (5) as 
                paragraphs (3) and (4), respectively.
    (c) Reauthorization of Summer Food Service Program.--Section 13(q) 
of the National School Lunch Act (42 U.S.C. 1761(q)) is amended by 
striking ``1998'' and inserting ``2003''.

SEC. 114. COMMODITY DISTRIBUTION PROGRAM.

    Section 14(a) of the National School Lunch Act (42 U.S.C. 1762a(a)) 
is amended by striking ``1998'' and inserting ``2003''.

SEC. 115. CHILD AND ADULT CARE FOOD PROGRAM.

    (a) Afterschool Care.--Section 17(a) of the National School Lunch 
Act (42 U.S.C. 1766(a)) is amended in the fourth sentence by striking 
``Reimbursement'' and inserting ``Except as provided in subsection (r), 
reimbursement''.
    (b) Revision to Licensing and Alternate Approval for Schools and 
Outside School Hours Child Care Centers.--Section 17(a) of the National 
School Lunch Act (42 U.S.C. 1766(a)) is amended in the sixth sentence 
by striking paragraph (1) and inserting the following:
            ``(1) each institution (other than a school or family or 
        group day care home sponsoring organization) and family or 
        group day care home shall--
                    ``(A)(i) have Federal, State, or local licensing or 
                approval; or
                    ``(ii) be complying with appropriate renewal 
                procedures as prescribed by the Secretary and not be 
                the subject of information possessed by the State 
                indicating that the license of the institution or home 
                will not be renewed;
                    ``(B) in any case in which Federal, State, or local 
                licensing or approval is not available--
                            ``(i) receive funds under title XX of the 
                        Social Security Act (42 U.S.C. 1397 et seq.);
                            ``(ii) meet any alternate approval 
                        standards established by a State or local 
                        government; or
                            ``(iii) meet any alternate approval 
                        standards established by the Secretary, after 
                        consultation with the Secretary of Health and 
                        Human Services; or
                    ``(C) in any case in which the institution provides 
                care to school children outside school hours and 
                Federal, State, or local licensing or approval is not 
                required, meet State or local health and safety 
                standards; and''.
    (c) Automatic Eligibility.--Section 17(c) of the National School 
Lunch Act (42 U.S.C. 1766(c)) is amended by striking paragraph (6).
    (d) Periodic Site Visits.--Section 17(d) of the National School 
Lunch Act (42 U.S.C. 1766(d)) is amended--
            (1) in the second sentence of paragraph (1), by inserting 
        after ``if it'' the following: ``has been visited by a State 
        agency prior to approval and it''; and
            (2) in paragraph (2)(A)--
                    (A) by striking ``that allows'' and inserting 
                ``that--
            ``(i) allows'';
                    (B) by striking the period at the end and inserting 
                ``; and''; and
                    (C) by adding at the end the following:
            ``(ii) requires periodic site visits to private 
        institutions that the State agency determines have a high 
        probability of program abuse.''.
    (e) Tax Exempt Status and Removal of Notification Requirement for 
Incomplete Applications.--Section 17(d)(1) of the National School Lunch 
Act (42 U.S.C. 1766(d)(1)) is amended--
            (1) by inserting after the third sentence the following: 
        ``An institution moving toward compliance with the requirement 
        for tax exempt status shall be allowed to participate in the 
        child and adult care food program for a period of not more than 
        180 days, except that a State agency may grant a single 
        extension of not to exceed an additional 90 days if the 
        institution demonstrates, to the satisfaction of the State 
        agency, that the inability of the institution to obtain tax 
        exempt status within the 180-day period is due to circumstances 
        beyond the control of the institution.''; and
            (2) by striking the last sentence.
    (f) Demonstration Projects.--Section 17(p) of the National School 
Lunch Act (42 U.S.C. 1766(p)) is amended--
            (1) in paragraph (1), by striking ``appropriated or 
        otherwise made available for purposes of carrying out this 
        section'' and inserting ``made available under paragraph (4)'';
            (2) by striking paragraphs (4) and (5); and
            (3) by adding at the end the following:
            ``(4) Funding.--Out of any moneys in the Treasury not 
        otherwise appropriated, the Secretary of the Treasury shall 
        provide to the Secretary such sums as are necessary to carry 
        out this subsection for each of fiscal years 1999 through 2003. 
        The Secretary shall be entitled to receive the funds and shall 
        accept the funds.''.
    (g) Management Support, Participation by At-Risk Child Care 
Programs, and WIC Outreach.--Section 17 of the National School Lunch 
Act (42 U.S.C. 1766) is amended by adding at the end the following:
    ``(q) Management Support.--
            ``(1) Technical and training assistance.--In addition to 
        the training and technical assistance that is provided to State 
        agencies under other provisions of this Act and the Child 
        Nutrition Act of 1966 (42 U.S.C. 1771 et seq.), the Secretary 
        shall provide training and technical assistance in order to 
        assist the State agencies in improving their program management 
        and oversight under this section.
            ``(2) Funding.--For each of fiscal years 1999 through 2003, 
        the Secretary shall reserve to carry out paragraph (1) 
        $1,000,000 of the amounts made available to carry out this 
        section.
    ``(r) Program for At-Risk School Children.--
            ``(1) Definition of at-risk school child.--In this 
        subsection, the term `at-risk school child' means a school 
        child who--
                    ``(A) is not more than 18 years of age; and
                    ``(B) lives in a geographical area served by a 
                school enrolling elementary students in which at least 
                50 percent of the total number of children enrolled are 
                certified as eligible to receive free or reduced price 
                school meals under this Act or the Child Nutrition Act 
                of 1966 (42 U.S.C. 1771 et seq.).
            ``(2) Participation in child and adult care food program.--
        Subject to the other provisions of this subsection, an 
        institution that provides supplements under a program organized 
        primarily to provide care to at-risk school children during 
        after-school hours, weekends, or holidays during the regular 
        school year may participate in the program authorized under 
        this section.
            ``(3) Administration.--Except as otherwise provided in this 
        subsection, the other provisions of this section apply to an 
        institution described in paragraph (2).
            ``(4) Supplement reimbursement.--
                    ``(A) Limitations.--An institution may claim 
                reimbursement under this subsection only for--
                            ``(i) a supplement served under a program 
                        organized primarily to provide care to at-risk 
                        school children during after-school hours, 
                        weekends, or holidays during the regular school 
                        year; and
                            ``(ii) 1 supplement per child per day.
                    ``(B) Rate.--Supplements shall be reimbursed under 
                this subsection at the rate established for free 
                supplements under subsection (c)(3).
                    ``(C) No charge.--A supplement claimed for 
                reimbursement under this subsection shall be served 
                without charge.
    ``(s) Information Concerning the Special Supplemental Nutrition 
Program for Women, Infants, and Children.--
            ``(1) In general.--The Secretary shall provide each State 
        agency administering a child and adult care food program under 
        this section with information concerning the special 
        supplemental nutrition program for women, infants, and children 
        authorized under section 17 of the Child Nutrition Act of 1966 
        (42 U.S.C. 1786).
            ``(2) Requirements for state agencies.--A State agency 
        shall ensure that each participating family and group day care 
        home and child care center (other than an institution providing 
        care to school children outside school hours)--
                    ``(A) receives materials that include--
                            ``(i) a basic explanation of the importance 
                        and benefits of the special supplemental 
                        nutrition program for women, infants, and 
                        children;
                            ``(ii) the maximum State income eligibility 
                        standards, according to family size, for the 
                        program; and
                            ``(iii) information concerning how benefits 
                        under the program may be obtained;
                    ``(B) is provided periodic updates of the 
                information described in subparagraph (A); and
                    ``(C) provides the information described in 
                subparagraph (A) to parents of enrolled children at 
                enrollment.''.

SEC. 116. TRANSFER OF HOMELESS ASSISTANCE PROGRAMS TO CHILD AND ADULT 
              CARE FOOD PROGRAM.

    (a) Summer Food Service Program for Children.--Section 13(a)(3)(C) 
of the National School Lunch Act (42 U.S.C. 1761(a)(3)(C)) is amended--
            (1) in clause (i), by inserting ``or'' after the semicolon;
            (2) by striking clause (ii); and
            (3) by redesignating clause (iii) as clause (ii).
    (b) Child and Adult Care Food Program.--Section 17 of the National 
School Lunch Act (as amended by section 115(g)) is amended--
            (1) in the third sentence of subsection (a)--
                    (A) by striking ``and public'' and inserting 
                ``public''; and
                    (B) by inserting before the period at the 
                following: ``, and emergency shelters described in 
                subsection (t)''; and
            (2) by adding at the end the following:
    ``(t) Participation by Emergency Shelters.--
            ``(1) Definition of emergency shelter.--In this subsection, 
        the term `emergency shelter' means a public or private 
        nonprofit emergency shelter (as defined in section 321 of the 
        Stewart B. McKinney Homeless Assistance Act (42 U.S.C. 11351)), 
        or a site operated by the shelter, that provides food service 
        to homeless children and their parents or guardians.
            ``(2) Administration.--Except as otherwise provided in this 
        subsection, the other provisions of this section shall apply to 
        an emergency shelter that is participating in the program 
        authorized under this section.
            ``(3) Institution and site licensing.--Subsection (a)(1) 
        shall not apply to an emergency shelter.
            ``(4) Health and safety standards.--To be eligible to 
        participate in the program authorized under this section, an 
        emergency shelter shall comply with applicable State and local 
        health and safety standards.
            ``(5) Meal or supplement reimbursement.--
                    ``(A) Limitations.--An emergency shelter may claim 
                reimbursement under this subsection only for--
                            ``(i) a meal or supplement served to 
                        children who are not more than 12 years of age 
                        residing at the emergency shelter; and
                            ``(ii) not more than 3 meals, or 2 meals 
                        and 1 supplement, per child per day.
                    ``(B) Rate.--A meal or supplement shall be 
                reimbursed under this subsection at the rate 
                established for a free meal or supplement under 
                subsection (c).
                    ``(C) No charge.--A meal or supplement claimed for 
                reimbursement under this subsection shall be served 
                without charge.''.
    (c) Homeless Children Nutrition Program.--Section 17B of the 
National School Lunch Act (42 U.S.C. 1766b) is repealed.

SEC. 117. MEAL SUPPLEMENTS FOR CHILDREN IN AFTERSCHOOL CARE.

    (a) General Authority.--Section 17A(a) of the National School Lunch 
Act (42 U.S.C. 1766a(a)) is amended--
            (1) in paragraph (1), by striking ``supplements to'' and 
        inserting ``supplements under a program organized primarily to 
        provide care for''; and
            (2) in paragraph (2), by striking subparagraph (C) and 
        inserting the following:
                    ``(C) operate afterschool programs with an 
                educational or enrichment purpose.''.
    (b) Eligible Children.--Section 17A(b) of the National School Lunch 
Act (42 U.S.C. 1766a(b)) is amended--
            (1) in paragraph (1), by striking ``or'' at the end;
            (2) in paragraph (2), by striking the period at the end and 
        inserting ``; or''; and
            (3) by adding at the end the following:
            ``(3) in the case of children who live in a geographical 
        area served by a school enrolling elementary students in which 
        at least 50 percent of the total number of children enrolled 
        are certified as eligible to receive free or reduced price 
        school meals under this Act or the Child Nutrition Act of 1966 
        (42 U.S.C. 1771 et seq.), who are not more than 18 years of 
        age.''.
    (c) Reimbursement.--Section 17A(c) of the National School Lunch Act 
(42 U.S.C. 1766a(c)) is amended--
            (1) by striking ``(c) Reimbursement.--For'' and inserting 
        the following:
    ``(c) Reimbursement.--
            ``(1) In general.--Except as provided in paragraph (2), 
        for''; and
            (2) by adding at the end the following:
            ``(2) Low-income areas.--A supplement provided under this 
        section to a child described in subsection (b)(3) shall be--
                    ``(A) reimbursed at the rate at which free 
                supplements are reimbursed under section 17(c); and
                    ``(B) served without charge.''.

SEC. 118. PILOT PROJECTS.

    Section 18 of the National School Lunch Act (42 U.S.C. 1769) is 
amended--
            (1) in subsection (c)--
                    (A) in paragraphs (1) and (7)(A), by striking 
                ``1998'' each place it appears and inserting ``2003''; 
                and
                    (B) in paragraph (7)--
                            (i) by striking ``(A)''; and
                            (ii) by striking subparagraph (B); and
            (2) by striking subsections (e), (g), (h), and (i).

SEC. 119. BREAKFAST PILOT PROJECTS.

    Section 18 of the National School Lunch Act (42 U.S.C. 1769) (as 
amended by section 118(2)) is amended by inserting after subsection (d) 
the following:
    ``(e) Breakfast Pilot Projects.--
            ``(1) In general.--During each of the school years 
        beginning July 1, 1999, July 1, 2000, and July 1, 2001, the 
        Secretary shall make grants to State agencies to conduct pilot 
        projects in elementary schools under the jurisdiction of not 
        more than 6 school food authorities approved by the Secretary--
                    ``(A) to reduce paperwork and simplify meal 
                counting requirements; and
                    ``(B) to evaluate the effect of providing free 
                breakfasts to elementary school children, without 
                regard to family income, on participation, academic 
                achievement, attendance and tardiness, and dietary 
                intake over the course of a day.
            ``(2) Nominations.--A State agency that desires to receive 
        a grant under this subsection shall submit to the Secretary 
        nominations of school food authorities to participate in a 
        pilot project under this subsection
            ``(3) Approval.--The Secretary shall approve for 
        participation in pilot projects under this subsection 
        elementary schools under the jurisdiction of not more than 6 
        school food authorities selected so as to--
                    ``(A) provide for an equitable distribution of 
                pilot projects among urban and rural elementary 
                schools;
                    ``(B) provide for an equitable distribution of 
                pilot projects among elementary schools of varying 
                family income levels; and
                    ``(C) permit the evaluation of pilot projects to 
                distinguish the effects of the pilot projects from 
                other factors, such as changes or differences in 
                educational policies or program.
            ``(4) Grants to school food authorities.--A State receiving 
        a grant under paragraph (1) shall make grants to school food 
        authorities to conduct the pilot projects described in 
        paragraph (1).
            ``(5) Duration of pilot projects.--A school food authority 
        receiving amounts under a grant to conduct a pilot project 
        described in paragraph (1) shall conduct the project for the 3-
        year period beginning July 1, 1999.
            ``(6) Waiver authority.--The Secretary may waive the 
        requirements of this Act and the Child Nutrition Act of 1966 
        (42 U.S.C. 1771 et seq.) relating to counting of meals, 
        applications for eligibility, and other requirements that would 
        preclude the Secretary from making a grant to conduct a pilot 
        project under paragraph (1).
            ``(7) Requirements for participation in pilot project.--To 
        be eligible to participate in a pilot project under this 
        subsection--
                    ``(A) a State--
                            ``(i) shall submit an application to the 
                        Secretary at such time and in such manner as 
                        the Secretary shall establish to meet criteria 
                        the Secretary has established to enable a valid 
                        evaluation to be conducted; and
                            ``(ii) shall provide such information 
                        relating to the operation and results of the 
                        pilot project as the Secretary may reasonably 
                        require; and
                    ``(B) a school food authority--
                            ``(i) shall agree to serve all breakfasts 
                        at no charge to all children in participating 
                        elementary schools;
                            ``(ii) shall not have a history of 
                        violations of this Act or the Child Nutrition 
                        Act of 1966 (42 U.S.C. 1771 et seq.);
                            ``(iii) shall have, under the jurisdiction 
                        of the school food authority, a sufficient 
                        number of elementary schools that are not 
                        participating in the pilot projects to permit 
                        an evaluation of the effects of the pilot 
                        projects; and
                            ``(iv) shall meet all other requirements 
                        that the Secretary may reasonably require.
            ``(8) Reimbursement rates.--A school food authority 
        conducting a pilot project under this subsection shall receive 
        reimbursement for each breakfast served under the pilot project 
        in an amount that is equal to--
                    ``(A) in the case of a school food authority that 
                is determined by the Secretary not to be in severe 
                need, the rate for free breakfasts established under 
                section 4(b)(1)(B) of the Child Nutrition Act of 1966 
                (42 U.S.C. 1773(b)(1)(B)); and
                    ``(B) in the case of a school food authority that 
                is determined by the Secretary to be in severe need, 
                the rate for free breakfasts established under section 
                4(b)(2)(B) of the Child Nutrition Act of 1966 (42 
                U.S.C. 1773(b)(2)(B)).
            ``(9) Evaluation of pilot projects.--
                    ``(A) In general.--The Secretary, acting through 
                the Administrator of the Food and Nutrition Service, 
                shall conduct an evaluation of the pilot projects 
                conducted by the school food authorities selected for 
                participation.
                    ``(B) Content.--The evaluation shall include--
                            ``(i) a determination of the effect of 
                        participation in the pilot project on 
the academic achievement, attendance and tardiness, and dietary intake 
over the course of a day of participating children that is not 
attributable to changes in educational policies and practices; and
                            ``(ii) a determination of the effect that 
                        participation by elementary schools in the 
                        pilot project has on the proportion of students 
                        who eat breakfast and on the paperwork required 
                        to be completed by the schools.
                    ``(C) Report.--On completion of the pilot projects 
                and the evaluation, the Secretary shall submit to the 
                Committee on Education and the Workforce of the House 
                of Representatives and the Committee on Agriculture, 
                Nutrition, and Forestry of the Senate a report 
                containing the results of the evaluation of the pilot 
                projects required under subparagraph (A).
            ``(10) Federal reimbursement.--
                    ``(A) In general.--Except as provided in 
                subparagraph (B), a school conducting a pilot project 
                under this subsection shall receive a total Federal 
                reimbursement under the school breakfast program in an 
                amount that is equal to the total Federal reimbursement 
                for the school for the prior year under the program 
                (adjusted for inflation and fluctuations in 
                enrollment).
                    ``(B) Excess needs.--Funds required for the pilot 
                project in excess of the level of reimbursement 
                received by the school for the prior year (adjusted for 
                inflation and fluctuations in enrollment) may be taken 
                from any non-Federal source or from amounts provided 
                under this subsection.
            ``(11) Funding.--
                    ``(A) In general.--Out of any moneys in the 
                Treasury not otherwise appropriated, the Secretary of 
                the Treasury shall provide to the Secretary such sums 
                as are necessary to carry out this subsection, but not 
                more than $20,000,000. The Secretary shall be entitled 
                to receive the funds and shall accept the funds.
                    ``(B) Evaluation.--Of the amounts made available 
                under subparagraph (A), not more than $12,000,000 shall 
                be made available to carry out paragraph (9).''.

SEC. 120. TRAINING AND TECHNICAL ASSISTANCE.

    Section 21(e)(1) of the National School Lunch Act (42 U.S.C. 1769b-
1(e)(1)) is amended by striking ``1998'' and inserting ``2003''.

SEC. 121. FOOD SERVICE MANAGEMENT INSTITUTE.

    Section 21(e)(2)(A) of the National School Lunch Act (42 U.S.C. 
1769b-1(e)(2)(A)) is amended by striking ``and $2,000,000 for fiscal 
year 1996 and each subsequent fiscal year,'' and inserting ``$2,000,000 
for each of fiscal years 1996 through 1998, and $3,000,000 for fiscal 
year 1999 and each subsequent fiscal year''.

SEC. 122. COMPLIANCE AND ACCOUNTABILITY.

    Section 22(d) of the National School Lunch Act (42 U.S.C. 1769c(d)) 
is amended by striking ``1996'' and inserting ``2003''.

SEC. 123. INFORMATION CLEARINGHOUSE.

    Section 26(d) of the National School Lunch Act (42 U.S.C. 1769g(d)) 
is amended in the first sentence by striking ``and $100,000 for fiscal 
year 1998'' and inserting ``$100,000 for fiscal year 1998, and $166,000 
for each of fiscal years 1999 through 2003''.

SEC. 124. REFOCUSING OF EFFORT TO HELP ACCOMMODATE THE SPECIAL DIETARY 
              NEEDS OF INDIVIDUALS WITH DISABILITIES.

    Section 27 of the National School Lunch Act (42 U.S.C. 1769h) is 
amended to read as follows:

``SEC. 27. ACCOMMODATION OF SPECIAL DIETARY NEEDS OF INDIVIDUALS WITH 
              DISABILITIES.

    ``(a) Definitions.--In this section:
            ``(1) Covered program.--The term `covered program' means--
                    ``(A) the school lunch program authorized under 
                this Act;
                    ``(B) the school breakfast program authorized under 
                section 4 of the Child Nutrition Act of 1966 (42 U.S.C. 
                1773); and
                    ``(C) any other program authorized under this Act 
                or the Child Nutrition Act of 1966 that the Secretary 
                determines is appropriate.
            ``(2) Eligible entity.--The term `eligible entity' means a 
        school food authority, institution, or service institution that 
        participates in a covered program.
            ``(3) Individuals with disabilities.--The term `individual 
        with disabilities' has the meaning given the term in section 7 
        of the Rehabilitation Act of 1973 (29 U.S.C. 706) for purposes 
        of title VII of that Act (29 U.S.C. 796 et seq.).
    ``(b) Activities.--The Secretary may carry out activities to help 
accommodate the special dietary needs of individuals with disabilities 
who are participating in a covered program, including--
            ``(1) developing and disseminating to State agencies 
        guidance and technical assistance materials;
            ``(2) conducting training of State agencies and eligible 
        entities; and
            ``(3) issuing grants to State agencies and eligible 
        entities.''.

            TITLE II--SCHOOL BREAKFAST AND RELATED PROGRAMS

SEC. 201. ELIMINATION OF ADMINISTRATION OF PROGRAMS BY REGIONAL 
              OFFICES.

    Section 5 of the Child Nutrition Act of 1966 (42 U.S.C. 1774) is 
amended to read as follows:

``SEC. 5. DISBURSEMENT TO SCHOOLS BY THE SECRETARY.

    ``(a) Authority To Administer Programs.--
            ``(1) In general.--Except as provided in paragraph (3), 
        during the period determined under subsection (c), the 
        Secretary shall withhold funds payable to a State under this 
        Act and disburse the funds directly to school food authorities, 
        institutions, and service institutions within the State for the 
        purposes authorized by this Act to the extent that the 
        Secretary has so withheld and disbursed the funds continuously 
        since October 1, 1980.
            ``(2) Use of funds.--Any funds withheld and disbursed by 
        the Secretary under paragraph (1) shall be used for the same 
        purposes and be subject to the same conditions as apply to 
        disbursing funds made available to States under this Act.
            ``(3) State administration.--If the Secretary is 
        administering (in whole or in part) any program authorized 
        under this Act in a State, the State may, on request to the 
        Secretary, assume administrative responsibility for the program 
        at any time during the period determined under subsection (c).
    ``(b) Provision of Training and Technical Assistance.--During the 
period determined under subsection (c), the Secretary shall provide a 
State that assumes administrative responsibility for a program from the 
Secretary with training and technical assistance to allow for an 
efficient and effective transfer of administrative responsibility.
    ``(c) Period.--
            ``(1) In general.--Except as provided in paragraph (2), 
        this section shall apply during the period beginning on October 
        1, 1998, and ending on September 30, 2001.
            ``(2) Extension.--The Secretary may extend the period 
        described in paragraph (1) that applies to a program 
        administered by the Secretary for a State, for a period not to 
        exceed 2 years, if the State--
                    ``(A) demonstrates to the Secretary that the State 
                will not be able to assume administrative 
                responsibility for the program during the period 
                described in paragraph (1); and
                    ``(B) submits a plan to the Secretary that 
                describes when and how the State will assume 
                administrative responsibility for the program.''.

SEC. 202. STATE ADMINISTRATIVE EXPENSES.

    (a) Homeless Shelters.--Section 7(a)(5) of the Child Nutrition Act 
of 1966 (42 U.S.C. 1776(a)(5)) is amended by striking subparagraph (B) 
and inserting the following:
                    ``(B) Reallocation of funds.--
                            ``(i) Return to secretary.--For each fiscal 
                        year, any amounts appropriated that are not 
                        obligated or expended during the fiscal year 
                        and are not carried over for the succeeding 
                        fiscal year under subparagraph (A) shall be 
                        returned to the Secretary.
                            ``(ii) Reallocation by secretary.--The 
                        Secretary shall allocate, for purposes of 
                        administrative costs, any remaining amounts 
                        among States that demonstrate a need for the 
                        amounts.''.
    (b) Elimination of Transfer Limitation.--Section 7(a) of the Child 
Nutrition Act of 1966 (42 U.S.C. 1776(a)) is amended by striking 
paragraph (6) and inserting the following:
            ``(6) Use of administrative funds.--Funds available to a 
        State under this subsection and under section 13(k)(1) of the 
        National School Lunch Act (42 U.S.C. 1761(k)(1)) may be used by 
        the State for the costs of administration of the programs 
        authorized under the National School Lunch Act (42 U.S.C. 1751 
        et seq.) or this Act (except for the programs authorized under 
        sections 17 and 21 of this Act) without regard to the basis on 
        which the funds were earned and allocated.''.
    (c) Reauthorization of Program.--Section 7(g) of the Child 
Nutrition Act of 1966 (42 U.S.C. 1776(g)) is amended by striking 
``1998'' and inserting ``2003''.

SEC. 203. SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS, 
              AND CHILDREN.

    (a) Certification Period for Infants.--Section 17(d)(3) of the 
Child Nutrition Act of 1966 (42 U.S.C. 1786(d)(3)) is amended by adding 
at the end the following:
                    ``(C) Certification period for infants.--
                            ``(i) In general.--Except as provided in 
                        clause (ii), the procedures prescribed under 
                        subparagraph (A) shall include a requirement 
                        that a family that includes an infant shall not 
                        be certified to meet income eligibility 
                        criteria for the program for more than 180 days 
                        after the date of any certification.
                            ``(ii) Presumptively eligible families.--
                        Clause (i) shall not apply to a family with a 
                        member who is an individual described in clause 
                        (ii) or (iii) of paragraph (2)(A).''.
    (b) Additional Requirements for Applicants.--Section 17(d)(3) of 
the Child Nutrition Act of 1966 (42 U.S.C. 1786(d)(3)) (as amended by 
subsection (a)) is amended by adding at the end the following:
                    ``(D) Physical presence.--
                            ``(i) In general.--Except as provided in 
                        clause (ii), each applicant to the program 
                        shall be physically present at each 
                        certification determination to determine 
                        eligibility under the program.
                            ``(ii) Waivers.--A local agency may waive 
                        the requirement of clause (i) with respect to 
                        an applicant if the agency determines that the 
                        requirement, as applied to the applicant, 
                        would--
                                    ``(I) conflict with the Americans 
                                with Disabilities Act of 1990 (42 
                                U.S.C. 12101 et seq.);
                                    ``(II) present a barrier to 
                                participation of a child (including an 
                                infant) who--
                                            ``(aa) was present at the 
                                        initial certification visit; 
                                        and
                                            ``(bb) is receiving ongoing 
                                        health care from a provider 
                                        other than the local agency; or
                                    ``(III) present a barrier to 
                                participation of a child (including an 
                                infant) who--
                                            ``(aa) was present at the 
                                        initial certification visit;
                                            ``(bb) was present at a 
                                        certification determination 
                                        within the 1-year period ending 
                                        on the date of the 
                                        certification determination 
                                        described in clause (i); and
                                            ``(cc) has 1 or more 
                                        parents who work.
                    ``(E) Income documentation.--
                            ``(i) In general.--Except as provided in 
                        clause (ii), to be eligible for the program, 
                        each applicant to the program shall provide--
                                    ``(I) documentation of household 
                                income; or
                                    ``(II) documentation of 
                                participation in a program described in 
                                clause (ii) or (iii) of paragraph 
                                (2)(A).
                            ``(ii) Waivers.--A State agency may waive 
                        the requirement of clause (i) with respect to--
                                    ``(I) an applicant for whom the 
                                necessary documentation is not 
                                available; or
                                    ``(II) an applicant, such as a 
                                homeless woman or child, for whom the 
                                agency determines the requirement of 
                                clause (i) would present a barrier to 
                                participation.
                            ``(iii) Regulations.--The Secretary shall 
                        prescribe regulations to carry out clause 
                        (ii)(I).
                    ``(F) Verification.--The Secretary shall issue 
                regulations under this paragraph prescribing when and 
                how verification of income shall be required.''.
    (c) Distribution of Nutrition Education Materials.--Section 
17(e)(3) of the Child Nutrition Act of 1966 (42 U.S.C. 1786(e)(3)) is 
amended--
            (1) by striking ``(3) The'' and inserting the following:
            ``(3) Nutrition education materials.--
                    ``(A) In general.--The''; and
            (2) by adding at the end the following:
                    ``(B) Sharing of materials with csfp.--The 
                Secretary may provide, in bulk quantity, nutrition 
                education materials (including materials promoting 
                breastfeeding) developed with funds made available for 
                the program authorized under this section to State 
                agencies administering the commodity supplemental food 
                program authorized under sections 4(a) and 5 of the 
                Agriculture and Consumer Protection Act of 1973 (Public 
                Law 93-86; 7 U.S.C. 612c note) at no cost to that 
                program.''.
    (d) Variety of Foods.--Section 17(f)(1)(C) of the Child Nutrition 
Act of 1966 (42 U.S.C. 1786(f)(1)(C)) is amended--
            (1) by redesignating clauses (ii) through (x) as clauses 
        (iii) through (xi), respectively; and
            (2) by inserting after clause (i) the following:
            ``(ii) in the case of any State that provides for the 
        purchase of foods under the program at retail grocery stores, a 
        plan to limit participation by the stores to stores that offer 
        a variety of foods, as determined by the Secretary;''.
    (e) Use of Claims for Vendors and Participants.--Section 17(f) of 
the Child Nutrition Act of 1966 (42 U.S.C. 1786(f)) is amended by 
striking paragraph (21) and inserting the following:
            ``(21) Use of claims from vendors and participants.--A 
        State agency may use funds recovered from vendors and 
        participants, as a result of a claim arising under the program, 
        to carry out the program during--
                    ``(A) the fiscal year in which the claim arises;
                    ``(B) the fiscal year in which the funds are 
                collected; or
                    ``(C) the fiscal year following the fiscal year in 
                which the funds are collected.''.
    (f) Recipients Participating at More Than 1 Site.--Section 17(f) of 
the Child Nutrition Act of 1966 (42 U.S.C. 1786(f)) is amended by 
adding at the end the following:
            ``(23) Recipients participating at more than 1 site.--Each 
        State agency shall implement a system designed by the State 
        agency to identify recipients who are participating at more 
        than 1 site under the program.''.
    (g) High Risk Vendors.--Section 17(f) of the Child Nutrition Act of 
1966 (42 U.S.C. 1786(f)) (as amended by subsection (f)) is amended by 
adding at the end the following:
            ``(24) High risk vendors.--Each State agency shall--
                    ``(A) identify vendors that have a high probability 
                of program abuse; and
                    ``(B) conduct compliance investigations of the 
                vendors.''.
    (h) Reauthorization of Program.--Section 17 of the Child Nutrition 
Act of 1966 (42 U.S.C. 1786) is amended in subsections (g)(1) and 
(h)(2)(A) by striking ``1998'' each place it appears and inserting 
``2003''.
    (i) Purchase of Breast Pumps.--Section 17(h)(1)(C) of the Child 
Nutrition Act of 1966 (42 U.S.C. 1786(h)(1)(C)) is amended--
            (1) by striking ``(C) In'' and inserting the following:
                    ``(C) Remaining amounts.--
                            ``(i) In general.--Except as provided in 
                        clause (ii), in''; and
            (2) by adding at the end the following:
                            ``(ii) Breast pumps.--
                                    ``(I) In general.--Beginning with 
                                fiscal year 2000, a State agency may 
                                use amounts made available under clause 
                                (i) for the purchase of breast pumps.
                                    ``(II) Maintenance of effort.--From 
                                amounts allocated for nutrition 
                                services and administration to amounts 
                                allocated for supplemental foods, a 
                                State agency that exercises the 
                                authority of subclause (I) shall 
                                transfer an amount equal to the amount 
                                expended for the purchase of breast 
                                pumps, or transferred under this 
                                subclause, from amounts allocated for 
                                nutrition services and administration 
                                for the preceding fiscal year.''.
    (j) Technical Amendment.--Section 17(h)(2)(A)(iv) of the Child 
Nutrition Act of 1966 (42 U.S.C. 1786(h)(2)(A)(iv)) is amended by 
striking ``, to the extent funds are not already provided under 
subparagraph (I)(v) for the same purpose,''.
    (k) Level of Per-Participant Expenditure for Nutrition Services and 
Administration.--Section 17(h)(2)(B)(ii) of the Child Nutrition Act of 
1966 (42 U.S.C. 1786(h)(2)(B)(ii)) is amended by striking ``15 
percent'' and inserting ``10 percent (except that the Secretary may 
establish a higher percentage for State agencies that are small)''.
    (l) Technical Amendments.--Section 17(h)(3) of the Child Nutrition 
Act of 1966 (42 U.S.C. 1786(h)(3)) is amended--
            (1) in subparagraph (E), by striking ``(except as provided 
        in subparagraph (G))''; and
            (2) by striking subparagraphs (F) and (G).
    (m) Conversion of Amounts for Supplemental Foods to Amounts for 
Nutrition Services and Administration.--Section 17(h)(5)(A) of the 
Child Nutrition Act of 1966 (42 U.S.C. 1786(h)(5)(A)) is amended in the 
matter preceding clause (i) by striking ``achieves'' and all that 
follows through ``such State agency may'' and inserting ``submits a 
plan to reduce average food costs per participant and to increase 
participation above the level estimated for the State agency, the State 
agency may, with the approval of the Secretary,''.
    (n) Infant Formula Procurement.--
            (1) Competitive bidding system.--Section 17(h)(8)(A) of the 
        Child Nutrition Act of 1966 (42 U.S.C. 1786(h)(8)(A)) is 
        amended by adding at the end the following:
                            ``(iii) Competitive bidding system.--A 
                        State agency using a competitive bidding system 
                        for infant formula shall award a contract to 
                        the bidder offering the lowest net price unless 
                        the State agency demonstrates to the 
                        satisfaction of the Secretary that the weighted 
                        average retail price for different brands of 
                        infant formula in the State does not vary by 
                        more than 5 percent.''.
            (2) Review and approval of solicitations.--Section 17(h)(8) 
        of the Child Nutrition Act of 1966 (42 U.S.C. 1786(h)(8)) is 
amended by adding at the end the following:
                    ``(K) Review and approval of solicitations.--The 
                Secretary shall--
                            ``(i) prior to the issuance of an infant 
                        formula cost containment contract solicitation 
                        under this paragraph, review the solicitation 
                        to ensure that the solicitation does not 
                        contain any anticompetitive provisions; and
                            ``(ii) approve the solicitation only if the 
                        solicitation does not contain any 
                        anticompetitive provisions.''.
    (o) Infrastructure and Breastfeeding Support and Promotion.--
Section 17(h)(10)(A) of the Child Nutrition Act of 1966 (42 U.S.C. 
1786(h)(10)(A)) is amended by striking ``1998'' and inserting ``2003''.
    (p) Management Information System Plan.--Section 17(h) of the Child 
Nutrition Act of 1966 (42 U.S.C. 1786(h)) is amended by adding at the 
end the following:
            ``(11) Management information system plan.--
                    ``(A) In general.--In consultation with State 
                agencies, retailers, and other interested persons, the 
                Secretary shall establish a long-range plan for the 
                development and implementation of management 
                information systems (including electronic benefit 
                transfers) to be used in carrying out the program.
                    ``(B) Report.--Not later than 2 years after the 
                date of enactment of this paragraph, the Secretary 
                shall submit to the Committee on Education and the 
                Workforce of the House of Representatives and the 
                Committee on Agriculture, Nutrition, and Forestry of 
                the Senate a report on actions taken to carry out 
                subparagraph (A).
                    ``(C) Interim period.--Prior to the date of 
                submission of the report of the Secretary required 
                under subparagraph (B), the cost of systems or 
                equipment that may be required to test management 
                information systems (including electronic benefit 
                transfers) for the program may not be imposed on a 
                retail food store.''.
    (q) Use of Funds in Preceding and Subsequent Fiscal Years.--
            (1) In general.--Section 17(i)(3)(A) of the Child Nutrition 
        Act of 1966 (42 U.S.C. 1786(i)(3)(A)) is amended--
                    (A) by striking ``subparagraphs (B) and (C)'' and 
                inserting ``subparagraph (B)''; and
                    (B) by striking clauses (i) and (ii) and inserting 
                the following:
            ``(i)(I) not more than 1 percent (except as provided in 
        subparagraph (C)) of the amount of funds allocated to a State 
        agency under this section for supplemental foods for a fiscal 
        year may be expended by the State agency for allowable expenses 
        incurred under this section for supplemental foods during the 
        preceding fiscal year; and
            ``(II) not more than 1 percent of the amount of funds 
        allocated to a State agency under this section for nutrition 
        services and administration for a fiscal year may be expended 
        by the State agency for allowable expenses incurred under this 
        section for supplemental foods and nutrition services and 
        administration during the preceding fiscal year; and
            ``(ii)(I) for each fiscal year, of the amounts allocated to 
        a State agency for nutrition services and administration, an 
        amount equal to not more than 1 percent of the amount allocated 
        to the State agency under this section for the fiscal year may 
        be expended by the State agency for allowable expenses incurred 
        under this section for nutrition services and administration 
        during the subsequent fiscal year; and
            ``(II) for each fiscal year, of the amounts allocated to a 
        State agency for nutrition services and administration, an 
        amount equal to not more than \1/2\ of 1 percent of the amount 
        allocated to the State agency under this section for the fiscal 
        year may be expended by the State agency, with the prior 
        approval of the Secretary, for the development of a management 
        information system, including an electronic benefit transfer 
        system, during the subsequent fiscal year.''.
            (2) Conforming amendments.--Section 17 of the Child 
        Nutrition Act of 1966 (42 U.S.C. 1786) is amended--
                    (A) in subsection (h)(10)(A), by inserting after 
                ``nutrition services and administration funds'' the 
                following: ``and supplemental foods funds''; and
                    (B) in subsection (i)(3)--
                            (i) by striking subparagraphs (C) through 
                        (G); and
                            (ii) by redesignating subparagraph (H) as 
                        subparagraph (C).
    (r) Farmers Market Nutrition Program.--Section 17(m) of the Child 
Nutrition Act of 1966 (42 U.S.C. 1786(m)) is amended--
            (1) in the first sentence of paragraph (3), by inserting 
        ``or from program income'' before the period at the end;
            (2) in paragraph (6)--
                    (A) in subparagraph (C)--
                            (i) by striking ``serve additional 
                        recipients in'';
                            (ii) by striking clause (ii) and inserting 
                        the following:
            ``(ii) documentation that demonstrates that--
                    ``(I) there is a need for an increase in funds; and
                    ``(II) the use of the increased funding will be 
                consistent with serving nutritionally at-risk persons 
                and expanding the awareness and use of farmers' 
                markets;'';
                            (iii) in clause (iii), by striking the 
                        period at the end and inserting ``; and''; and
                            (iv) by adding at the end the following:
            ``(iv) whether, in the case of a State that intends to use 
        any funding provided under subparagraph (G)(i) to increase the 
        value of the Federal share of the benefits received by a 
        recipient, the funding provided under subparagraph (G)(i) will 
        increase the rate of coupon redemption.'';
                    (B) by striking subparagraph (F);
                    (C) in subparagraph (G)--
                            (i) in clause (i)--
                                    (I) in the first sentence, by 
                                striking ``that wish'' and all follows 
                                through ``to do so'' and inserting 
                                ``whose State plan''; and
                                    (II) in the second sentence, by 
                                striking ``for additional recipients''; 
                                and
                            (ii) in the second sentence of clause (ii), 
                        by striking ``that desire to serve additional 
                        recipients, and''; and
                    (D) by redesignating subparagraph (G) as 
                subparagraph (F); and
            (3) in paragraph (9)(A), by striking ``1998'' and inserting 
        ``2003''.
    (s) Disqualification of Certain Vendors.--
            (1) In general.--Section 17 of the Child Nutrition Act of 
        1966 (42 U.S.C. 1786) is amended by adding at the end the 
        following:
    ``(o) Disqualification of Vendors Convicted of Trafficking or 
Illegal Sales.--
            ``(1) In general.--Except as provided in paragraph (4), a 
        State agency shall permanently disqualify from participation in 
        the program authorized under this section a vendor convicted 
        of--
                    ``(A) trafficking in food instruments (including 
                any voucher, draft, check, or access device (including 
                an electronic benefit transfer card or personal 
                identification number) issued in lieu of a food 
                instrument under this section); or
                    ``(B) selling firearms, ammunition, explosives, or 
                controlled substances (as defined in section 102 of the 
                Controlled Substances Act (21 U.S.C. 802)) in exchange 
                for food instruments.
            ``(2) Notice of disqualification.--The State agency shall--
                    ``(A) provide the vendor with notification of the 
                disqualification; and
                    ``(B) make the disqualification effective on the 
                date of receipt of the notice of disqualification.
            ``(3) Prohibition of receipt of lost revenues.--A vendor 
        shall not be entitled to receive any compensation for revenues 
        lost as a result of disqualification under this subsection.
            ``(4) Exceptions in lieu of disqualification.--
                    ``(A) In general.--A State agency may permit a 
                vendor that, but for this paragraph, would be 
                disqualified under paragraph (1), to continue to redeem 
                food instruments or otherwise provide supplemental 
                foods to participants if the State agency determines, 
                in its sole discretion according to criteria 
                established by the Secretary, that--
                            ``(i) disqualification of the vendor would 
                        cause hardship to participants in the program 
                        authorized under this section; or
                            ``(ii)(I) the vendor had, at the time of 
                        the conviction under paragraph (1), an 
                        effective policy and program in effect to 
                        prevent violations of this section; and
                            ``(II) the ownership of the vendor was not 
                        aware of, did not approve of, did not benefit 
                        from, and was not involved in the conduct of 
                        the violation.
                    ``(B) Civil penalty.--If a State agency authorizes 
                a vendor that, but for this paragraph, would be 
                disqualified under paragraph (1) to redeem food 
                instruments or provide supplemental foods under 
                subparagraph (A), in lieu of disqualification, the 
                State agency shall assess the vendor a civil penalty in 
                an amount determined by the State agency, except that--
                            ``(i) the amount of the civil penalty shall 
                        not exceed $20,000; and
                            ``(ii) the amount of civil penalties 
                        imposed for violations investigated as part of 
                        a single investigation may not exceed 
                        $40,000.''.
            (2) Regulations.--The amendment made by paragraph (1) shall 
        take effect on the date on which the Secretary of Agriculture 
        issues a final regulation that includes the criteria for--
                    (A) making hardship determinations; and
                    (B) determining the amount of a civil money penalty 
                in lieu of disqualification.
    (t) Criminal Forfeiture.--Section 17 of the Child Nutrition Act of 
1966 (42 U.S.C. 1786) (as amended by subsection (s)(1)) is amended by 
adding at the end the following:
    ``(p) Criminal Forfeiture.--
            ``(1) In general.--In addition to any other penalty or 
        sentence, a court may order that a person forfeit to the United 
        States all property described in paragraph (2), in imposing a 
        sentence on a person convicted of a violation of this section 
        (including a regulation) under--
                    ``(A) section 12(g) of the National School Lunch 
                Act (42 U.S.C. 1760(g)); or
                    ``(B) any other Federal law imposing a penalty for 
                embezzlement, willful misapplication, stealing, 
                obtaining by fraud, or trafficking in food instruments, 
                funds, assets, or property, that have a value of $100 
                or more.
            ``(2) Property subject to forfeiture.--All property, real 
        and personal, used in a transaction or attempted transaction, 
        to commit, or to facilitate the commission of, a violation 
        (other than a misdemeanor) of any provision of this section 
        (including a regulation), or proceeds traceable to a violation 
        of any provision of this section (including a regulation), 
        shall be subject to forfeiture to the United States under 
        paragraph (1).
            ``(3) Interest of owner.--No interest in property shall be 
        forfeited under this subsection as the result of any act or 
        omission established by the owner of the interest to have been 
        committed or omitted without the knowledge or consent of the 
        owner.
            ``(4) Proceeds.--The proceeds from any sale of forfeited 
        property and any amounts forfeited under this subsection shall 
        be used--
                    ``(A) first, to reimburse the Department of 
                Justice, the Department of the Treasury, and the United 
                States Postal Service for the costs incurred by the 
                Departments or Service to initiate and complete the 
                forfeiture proceeding;
                    ``(B) second, to reimburse the Office of Inspector 
                General of the Department of Agriculture for any costs 
                incurred by the Office in the law enforcement effort 
                resulting in the forfeiture;
                    ``(C) third, to reimburse any Federal, State, or 
                local law enforcement agency for any costs incurred in 
                the law enforcement effort resulting in the forfeiture; 
                and
                    ``(D) fourth, by the State agency to carry out 
                approval, reauthorization, and compliance 
                investigations of vendors.''.
    (u) Study and Report on Cost Containment Practices.--
            (1) Study.--The Comptroller General of the United States 
        shall conduct a study on the effect of cost containment 
        practices of States under the special supplemental nutrition 
        program for women, infants, and children authorized under 
        section 17 of the Child Nutrition Act of 1966 (42 U.S.C. 1786) 
        for the selection of vendors and approved food items (other 
        than infant formula) on--
                    (A) program participation;
                    (B) access and availability of prescribed foods;
                    (C) voucher redemption rates and actual food 
                selections by participants;
                    (D) participants on special diets or with specific 
                food allergies;
                    (E) participant consumption of, and satisfaction 
                with, prescribed foods;
                    (F) achievement of positive health outcomes; and
                    (G) program costs.
            (2) Report.--Not later than 2 years after the date of 
        enactment of this Act, the Comptroller General shall submit to 
        the Secretary of Agriculture, the Committee on Education and 
the Workforce of the House of Representatives, and the Committee on 
Agriculture, Nutrition, and Forestry of the Senate a report containing 
the results of the study conducted under paragraph (1).
    (v) Study and Report on WIC Services.--
            (1) Study.--The Comptroller General of the United States 
        shall conduct a study that assesses--
                    (A) the cost of delivering services under the 
                special supplemental nutrition program for women, 
                infants, and children authorized under section 17 of 
                the Child Nutrition Act of 1966 (42 U.S.C. 1786), 
                including the costs of implementing and administering 
                cost containment efforts;
                    (B) the fixed and variable costs incurred by State 
                and local governments for delivering the services;
                    (C) the quality of the services delivered, taking 
                into account the effect of the services on the health 
                of participants; and
                    (D) the costs incurred for personnel, automation, 
                central support, and other activities to deliver the 
                services and whether the costs meet Federal audit 
                standards for allowable costs under the program.
            (2) Report.--Not later than 3 years after the date of 
        enactment of this Act, the Comptroller General shall submit to 
        the Secretary of Agriculture, the Committee on Education and 
        the Workforce of the House of Representatives, and the 
        Committee on Agriculture, Nutrition, and Forestry of the Senate 
        a report containing the results of the study conducted under 
        paragraph (1).

SEC. 204. NUTRITION EDUCATION AND TRAINING.

    Section 19(i) of the Child Nutrition Act of 1966 (42 U.S.C. 
1788(i)) is amended--
            (1) by striking the subsection heading and all that follows 
        through paragraph (3)(A) and inserting the following:
    ``(i) Authorization of Appropriations.--
            ``(1) In general.--
                    ``(A) Funding.--There are authorized to be 
                appropriated such sums as are necessary to carry out 
                this section for each of fiscal years 1997 through 
                2003.''; and
            (2) by redesignating paragraphs (4) and (5) as paragraphs 
        (2) and (3), respectively.

               TITLE III--COMMODITY DISTRIBUTION PROGRAMS

SEC. 301. COMMODITY DISTRIBUTION PROGRAM REFORMS.

    (a) Commodity Specifications.--Section 3(a) of the Commodity 
Distribution Reform Act and WIC Amendments of 1987 (Public Law 100-237; 
7 U.S.C. 612c note) is amended by striking paragraph (2) and inserting 
the following:
            ``(2) Applicability.--Paragraph (1) shall apply to--
                    ``(A) the commodity supplemental food program 
                authorized under sections 4(a) and 5 of the Agriculture 
                and Consumer Protection Act of 1973 (Public Law 93-86; 
                7 U.S.C. 612c note);
                    ``(B) the food distribution program on Indian 
                reservations authorized under section 4(b) of the Food 
                Stamp Act of 1977 (7 U.S.C. 2013(b)); and
                    ``(C) the school lunch program authorized under the 
                National School Lunch Act (42 U.S.C. 1751 et seq.).''.
    (b) Customer Acceptability Information.--Section 3(f) of the 
Commodity Distribution Reform Act and WIC Amendments of 1987 (Public 
Law 100-237; 7 U.S.C. 612c note) is amended by striking paragraph (2) 
and inserting the following:
            ``(2) Customer acceptability information.--
                    ``(A) In general.--The Secretary shall ensure that 
                information with respect to the types and forms of 
                commodities that are most useful is collected from 
                recipient agencies participating in programs described 
                in subsection (a)(2).
                    ``(B) Frequency.--The information shall be 
                collected at least once every 2 years.
                    ``(C) Additional submissions.--The Secretary--
                            ``(i) may require submission of information 
                        described in subparagraph (A) from recipient 
                        agencies participating in other domestic food 
                        assistance programs administered by the 
                        Secretary; and
                            ``(ii) shall provide the recipient agencies 
                        a means for voluntarily submitting customer 
                        acceptability information.''.

SEC. 302. FOOD DISTRIBUTION.

    (a) In General.--Sections 8 through 12 of the Commodity 
Distribution Reform Act and WIC Amendments of 1987 (Public Law 100-237; 
7 U.S.C. 612c note) are amended to read as follows:

``SEC. 8. AUTHORITY TO TRANSFER COMMODITIES BETWEEN PROGRAMS.

    ``(a) Transfer.--Subject to subsection (b), the Secretary may 
transfer any commodities purchased for a domestic food assistance 
program administered by the Secretary to any other domestic food 
assistance program administered by the Secretary if the transfer is 
necessary to ensure that the commodities will be used while the 
commodities are still suitable for human consumption.
    ``(b) Reimbursement.--The Secretary shall, to the maximum extent 
practicable, provide reimbursement for the value of the commodities 
transferred under subsection (a) from accounts available for the 
purchase of commodities under the program receiving the commodities.
    ``(c) Crediting.--Any reimbursement made under subsection (b) 
shall--
            ``(1) be credited to the accounts that incurred the costs 
        when the transferred commodities were originally purchased; and
            ``(2) be available for the purchase of commodities with the 
        same limitations as are provided for appropriated funds for the 
        reimbursed accounts for the fiscal year in which the transfer 
        takes place.

``SEC. 9. AUTHORITY TO RESOLVE CLAIMS.

    ``(a) In General.--The Secretary may determine the amount of, 
settle, and adjust all or part of a claim arising under a domestic food 
assistance program administered by the Secretary.
    ``(b) Waivers.--The Secretary may waive a claim described in 
subsection (a) if the Secretary determines that a waiver would serve 
the purposes of the program.
    ``(c) Authority of the Attorney General.--Nothing in this section 
diminishes the authority of the Attorney General under section 516 of 
title 28, United States Code, or any other provision of law, to 
supervise and conduct litigation on behalf of the United States.

``SEC. 10. PAYMENT OF COSTS ASSOCIATED WITH REMOVAL OF COMMODITIES THAT 
              POSE A HEALTH OR SAFETY HAZARD.

    ``(a) In General.--The Secretary may use funds available to carry 
out section 32 of the Act of August 24, 1935 (49 Stat. 774, chapter 
641; 7 U.S.C. 612c), that are not otherwise committed, for the purpose 
of reimbursing States for State and local costs associated with the 
removal of commodities distributed under any domestic food assistance 
program administered by the Secretary if the Secretary determines that 
the commodities pose a health or safety hazard.
    ``(b) Allowable Costs.--The costs--
            ``(1) may include costs for storage, transportation, 
        processing, and destruction of the hazardous commodities; and
            ``(2) shall be subject to the approval of the Secretary.
    ``(c) Replacement Commodities.--
            ``(1) In general.--The Secretary may use funds described in 
        subsection (a) for the purpose of purchasing additional 
        commodities if the purchase will expedite replacement of the 
        hazardous commodities.
            ``(2) Recovery.--Use of funds under paragraph (1) shall not 
        restrict the Secretary from recovering funds or services from a 
        supplier or other entity regarding the hazardous commodities.
    ``(d) Crediting of Recovered Funds.--Funds recovered from a 
supplier or other entity regarding the hazardous commodities shall--
            ``(1) be credited to the account available to carry out 
        section 32 of the Act of August 24, 1935 (49 Stat. 774, chapter 
        641; 7 U.S.C. 612c), to the extent the funds represent 
        expenditures from that account under subsections (a) and (c); 
        and
            ``(2) remain available to carry out the purposes of section 
        32 of that Act until expended.

``SEC. 11. AUTHORITY TO ACCEPT COMMODITIES DONATED BY FEDERAL SOURCES.

    ``(a) In General.--The Secretary may accept donations of 
commodities from any Federal agency, including commodities of another 
Federal agency determined to be excess personal property pursuant to 
section 202(d) of the Federal Property and Administrative Services Act 
of 1949 (40 U.S.C. 483(d)).
    ``(b) Use.--The Secretary may donate the commodities received under 
subsection (a) to States for distribution through any domestic food 
assistance program administered by the Secretary.
    ``(c) Payment.--Notwithstanding section 202(d) of the Federal 
Property and Administrative Services Act of 1949 (40 U.S.C. 483(d)), 
the Secretary shall not be required to make any payment in connection 
with the commodities received under subsection (a).''.
    (b) Effect on Prior Amendments.--The amendment made by subsection 
(a) does not affect the amendments made by sections 8 through 12 of the 
Commodity Distribution Reform Act and WIC Amendments of 1987 (Public 
Law 100-237; 7 U.S.C. 612c note), as in effect on September 30, 1998.

                        TITLE IV--EFFECTIVE DATE

SEC. 401. EFFECTIVE DATE.

    Except as otherwise provided in this Act, this Act and the 
amendments made by this Act take effect on October 1, 1998.