[Congressional Bills 110th Congress]
[From the U.S. Government Publishing Office]
[S. 2926 Introduced in Senate (IS)]







110th CONGRESS
  2d Session
                                S. 2926

To amend title 38, United States Code, to modify and update provisions 
 of law relating to nonprofit research and education corporations, and 
                          for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             April 28, 2008

   Mr. Akaka introduced the following bill; which was read twice and 
             referred to the Committee on Veterans' Affairs

_______________________________________________________________________

                                 A BILL


 
To amend title 38, United States Code, to modify and update provisions 
 of law relating to nonprofit research and education corporations, and 
                          for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Veterans Nonprofit Research and 
Education Corporations Enhancement Act of 2008''.

SEC. 2. GENERAL AUTHORITIES ON ESTABLISHMENT OF CORPORATIONS.

    (a) Authorization of Multi-Medical Center Research Corporations.--
            (1) In general.--Section 7361 of such title is amended--
                    (A) by redesignating subsection (b) as subsection 
                (e); and
                    (B) by inserting after subsection (a) the following 
                new subsection (b):
    ``(b)(1) Subject to paragraph (2), a corporation established under 
this subchapter may facilitate the conduct of research, education, or 
both at more than one medical center. Such a corporation shall be known 
as a `multi-medical center research corporation'.
    ``(2) The board of directors of a multi-medical center research 
corporation under this subsection shall include the official at each 
Department medical center concerned who is, or who carries out the 
responsibilities of, the medical center director of such center as 
specified in section 7363(a)(1)(A)(i) of this title.
    ``(3) In facilitating the conduct of research, education, or both 
at more than one Department medical center under this subchapter, a 
multi-medical center research corporation may administer receipts and 
expenditures relating to such research, education, or both, as 
applicable, performed at the Department medical centers concerned.''.
            (2) Expansion of existing corporations to multi-medical 
        center research corporations.--Such section is further amended 
        by adding at the end the following new subsection:
    ``(f) A corporation established under this subchapter may act as a 
multi-medical center research corporation under this subchapter in 
accordance with subsection (b) if--
            ``(1) the board of directors of the corporation approves a 
        resolution permitting facilitation by the corporation of the 
        conduct of research, education, or both at the other Department 
        medical center or medical centers concerned; and
            ``(2) the Secretary approves the resolution of the 
        corporation under paragraph (1).''.
    (b) Restatement and Modification of Authorities on Applicability of 
State Law.--
            (1) In general.--Section 7361 of such title, as amended by 
        subsection (a) of this section, is further amended by inserting 
        after subsection (b) the following new subsection (c):
    ``(c) Any corporation established under this subchapter shall be 
established in accordance with the nonprofit corporation laws of the 
State in which the applicable Department medical center is located and 
shall, to the extent not inconsistent with any Federal law, be subject 
to the laws of such State. In the case of any multi-medical center 
research corporation that facilitates the conduct of research, 
education, or both at Department medical centers located in different 
States, the corporation shall be established in accordance with the 
nonprofit corporation laws of the State in which one of such Department 
medical centers is located.''.
            (2) Conforming amendment.--Section 7365 of such title is 
        repealed.
    (c) Clarification of Status of Corporations.--Section 7361 of such 
title, as amended by this section, is further amended--
            (1) in subsection (a), by striking the second sentence; and
            (2) by inserting after subsection (c) the following new 
        subsection (d):
    ``(d)(1) Except as otherwise provided in this subchapter or under 
regulations prescribed by the Secretary, any corporation established 
under this subchapter, and its officers, directors, and employees, 
shall be required to comply only with those Federal laws, regulations, 
and executive orders and directives that apply generally to private 
nonprofit corporations.
    ``(2) A corporation under this subchapter is not--
            ``(A) owned or controlled by the United States; or
            ``(B) an agency or instrumentality of the United States.''.
    (d) Reinstatement of Requirement for 501(c)(3) Status of 
Corporations.--Subsection (e) of section 7361 of such title, as 
redesignated by subsection (a)(1) of this section, is further amended 
by inserting ``section 501(c)(3) of'' after ``exempt from taxation 
under''.

SEC. 3. CLARIFICATION OF PURPOSES OF CORPORATIONS.

    (a) Clarification of Purposes.--Subsection (a) of section 7362 of 
title 38, United States Code, is amended--
            (1) by striking ``Any corporation'' and all that follows 
        through ``facilitate'' and inserting ``A corporation 
        established under this subchapter shall be established to 
        provide a flexible funding mechanism for the conduct of 
        approved research and education at one or more Department 
        medical centers and to facilitate functions related to the 
        conduct of''; and
            (2) by inserting before the period at the end the 
        following: ``or centers''.
    (b) Modification of Defined Term Relating to Education and 
Training.--Subsection (b) of such section is amended in the matter 
preceding paragraph (1) by striking ``the term `education and 
training''' and inserting ``the term `education' includes education and 
training and''.
    (c) Repeal of Role of Corporations With Respect to Fellowships.--
Paragraph (1) of subsection (b) of such section is amended by striking 
the flush matter following subparagraph (C).
    (d) Availability of Education for Families of Veteran Patients.--
Paragraph (2) of subsection (b) of such section is amended by striking 
``to patients and to the families'' and inserting ``and includes 
education and training for patients and families''.

SEC. 4. MODIFICATION OF REQUIREMENTS FOR BOARDS OF DIRECTORS OF 
              CORPORATIONS.

    (a) Requirements for Department Board Members.--Paragraph (1) of 
section 7363(a) of title 38, United States Code, is amended to read as 
follows:
            ``(1) with respect to the Department medical center--
                    ``(A)(i) the director (or directors of each 
                Department medical center, in the case of a multi-
                medical center research corporation);
                    ``(ii) the chief of staff; and
                    ``(iii) as appropriate for the activities of such 
                corporation, the associate chief of staff for research 
                and the associate chief of staff for education; or
                    ``(B) in the case of a Department medical center at 
                which one or more of the positions referred to in 
                subparagraph (A) do not exist, the official or 
                officials who are responsible for carrying out the 
                responsibilities of such position or positions at the 
                Department medical center; and''.
    (b) Requirements for Non-Department Board Members.--Paragraph (2) 
of such section is amended--
            (1) by inserting ``not less than two'' before ``members''; 
        and
            (2) by striking ``and who'' and all that follows through 
        the period at the end and inserting ``and who have backgrounds, 
        or business, legal, financial, medical, or scientific 
        expertise, of benefit to the operations of the corporation.''.
    (c) Conflicts of Interest.--Subsection (c) of section 7363 of such 
title is amended by striking ``, employed by, or have any other 
financial relationship with'' and inserting ``or employed by''.

SEC. 5. CLARIFICATION OF POWERS OF CORPORATIONS.

    (a) In General.--The text of section 7364 of title 38, United 
States Code, is amended to read as follows:
    ``(a)(1) A corporation established under this subchapter may, 
solely to carry out the purposes of this subchapter--
            ``(A) accept, administer, retain, and spend funds derived 
        from gifts, contributions, grants, fees, reimbursements, and 
        bequests from individuals and public and private entities;
            ``(B) enter into contracts and agreements with individuals 
        and public and private entities;
            ``(C) subject to paragraph (2), set fees for education and 
        training facilitated under section 7362 of this title, and 
        receive, retain, administer, and spend funds in furtherance of 
        such education and training;
            ``(D) reimburse amounts to the appropriation account of the 
        Department for the Office of General Counsel for any expenses 
        of that Office in providing legal services attributable to 
        research and education agreements under this subchapter; and
            ``(E) employ such employees as the corporation considers 
        necessary for such purposes and fix the compensation of such 
        employees.
    ``(2) Fees charged under paragraph (1)(C) for education and 
training described in that paragraph to individuals who are officers or 
employees of the Department may not be paid for by any funds 
appropriated to the Department.
    ``(3) Amounts reimbursed to the Office of General Counsel under 
paragraph (1)(D) shall be available for use by the Office of the 
General Counsel only for staff and training, and related travel, for 
the provision of legal services described in that paragraph.
    ``(b)(1) Except as provided in paragraph (2), any funds received by 
the Secretary for the conduct of research or education at a Department 
medical center or centers, other than funds appropriated to the 
Department, may be transferred to and administered by a corporation 
established under this subchapter for such purposes.
    ``(2) A Department medical center may reimburse the corporation for 
all or a portion of the pay, benefits, or both of an employee of the 
corporation who is assigned to the Department medical center if the 
assignment is carried out pursuant to subchapter VI of chapter 33 of 
title 5.
    ``(c) Except for reasonable and usual preliminary costs for project 
planning before its approval, a corporation established under this 
subchapter may not spend funds for a research project unless the 
project is approved in accordance with procedures prescribed by the 
Under Secretary for Health for research carried out with Department 
funds. Such procedures shall include a scientific review process.
    ``(d) Except for reasonable and usual preliminary costs for 
activity planning before its approval, a corporation established under 
this subchapter may not spend funds for an education activity unless 
the activity is approved in accordance with procedures prescribed by 
the Under Secretary for Health.
    ``(e) The Under Secretary for Health may prescribe policies and 
procedures to guide the spending of funds by corporations established 
under this subchapter that are consistent with the purpose of such 
corporations as flexible funding mechanisms and with Federal and State 
laws and regulations, and executive orders, circulars, and directives 
that apply generally to the receipt and expenditure of funds by 
nonprofit organizations exempt from taxation under section 501(c)(3) of 
the Internal Revenue Code of 1986.''.
    (b) Conforming Amendment.--Section 7362(a) of such title, as 
amended by section 3(a)(1) of this Act, is further amended by striking 
the last sentence.

SEC. 6. REDESIGNATION OF SECTION 7364A OF TITLE 38, UNITED STATES CODE.

    (a) Redesignation.--Section 7364A of title 38, United States Code, 
is redesignated as section 7365 of such title.
    (b) Clerical Amendments.--The table of sections at the beginning of 
chapter 73 of such title is amended--
            (1) by striking the item relating to section 7364A; and
            (2) by striking the item relating to section 7365 and 
        inserting the following new item:

``7365. Coverage of employees under certain Federal tort claims 
                            laws.''.

SEC. 7. IMPROVED ACCOUNTABILITY AND OVERSIGHT OF CORPORATIONS.

    (a) Additional Information in Annual Reports.--Subsection (b) of 
section 7366 of title 38, United States Code, is amended to read as 
follows:
    ``(b)(1) Each corporation shall submit to the Secretary each year a 
report providing a detailed statement of the operations, activities, 
and accomplishments of the corporation during that year.
    ``(2)(A) A corporation with revenues in excess of $300,000 for any 
year shall obtain an audit of the corporation for that year.
    ``(B) A corporation with annual revenues between $10,000 and 
$300,000 shall obtain an audit of the corporation at least once every 
three years.
    ``(C) Any audit under this paragraph shall be performed by an 
independent auditor.
    ``(3) The corporation shall include in each report to the Secretary 
under paragraph (1) the following:
            ``(A) The most recent audit of the corporation under 
        paragraph (2).
            ``(B) The most recent Internal Revenue Service Form 990 
        `Return of Organization Exempt from Income Tax' or equivalent 
        and the applicable schedules under such form.''.
    (b) Confirmation of Application of Conflict of Interest Regulations 
to Appropriate Corporation Positions.--Subsection (c) of such section 
is amended--
            (1) by striking ``laws and'' each place it appears;
            (2) in paragraph (1)--
                    (A) by inserting ``each officer and'' after ``under 
                this subchapter,''; and
                    (B) by striking ``, and each employee of the 
                Department'' and all that follows through ``during any 
                year''; and
            (3) in paragraph (2)--
                    (A) by inserting ``officer,'' after ``verifying 
                that each''; and
                    (B) by striking ``in the same manner'' and all that 
                follows before the period at the end.
    (c) Establishment of Appropriate Payee Reporting Threshold.--
Subsection (d)(3)(C) of such section is amended by striking ``$35,000'' 
and inserting ``$50,000''.

SEC. 8. REPEAL OF SUNSET.

    (a) Repeal.--Section 7368 of title 38, United States Code, is 
repealed.
    (b) Clerical Amendment.--The table of sections at the beginning of 
chapter 73 of such title is amended by striking the item relating to 
section 7368.
                                 <all>