[Congressional Bills 113th Congress]
[From the U.S. Government Publishing Office]
[S. 2691 Introduced in Senate (IS)]

113th CONGRESS
  2d Session
                                S. 2691

 To encourage and support partnerships between the public and private 
    sectors to improve our nation's social programs, and for other 
                               purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                             July 30, 2014

 Mr. Bennet (for himself and Mr. Hatch) introduced the following bill; 
     which was read twice and referred to the Committee on Finance

_______________________________________________________________________

                                 A BILL


 
 To encourage and support partnerships between the public and private 
    sectors to improve our nation's social programs, 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 ``Pay for Performance Act''.

SEC. 2. SOCIAL IMPACT PAY FOR PERFORMANCE CONTRACTS.

    Title XX of the Social Security Act (42 U.S.C. 1397) is amended--
            (1) in the title heading, by striking ``TO STATES'' and 
        inserting ``AND PROJECTS''; and
            (2) by adding at the end the following:

       ``Subtitle C--Social Impact Pay for Performance Contracts

``SEC. 2051. PURPOSES.

    ``The purposes of this subtitle are the following:
            ``(1) To improve the lives of families and individuals in 
        need in the United States by funding social programs that 
        achieve real results.
            ``(2) To redirect funds away from programs that, based on 
        objective data, are ineffective, and into programs that achieve 
        demonstrable, measurable results.
            ``(3) To ensure Federal funds are used effectively on 
        social services to produce positive outcomes for both service 
        recipients and taxpayers.
            ``(4) To establish the use of social impact pay for 
        performance contracts to address some of our Nation's most 
        pressing problems.
            ``(5) To facilitate the creation of public-private 
        partnerships that bundle philanthropic and other private 
        resources with existing public spending to scale up effective 
        social interventions already being implemented by private 
        organizations, non-profits, charitable organizations, and local 
        governments across the country.
            ``(6) To bring pay-for-performance to the social services 
        sector, allowing the United States to improve the impact and 
        effectiveness of vital social services programs while 
        redirecting inefficient or duplicative spending.

``SEC. 2052. SOCIAL IMPACT PAY FOR PERFORMANCE CONTRACT APPLICATION.

    ``(a) Notice.--Not later than 1 year after the date of the 
enactment of this subtitle, the Secretary of the Treasury (referred to 
in this subtitle as the `Secretary'), in consultation with the Federal 
Interagency Council on Social Impact Pay for Performance Contracts 
(established by section 2056), shall publish in the Federal Register a 
request for proposals from States or local governments for social 
impact pay for performance contract projects in accordance with this 
section.
    ``(b) Required Outcomes for Social Impact Pay for Performance 
Contract Project.--To qualify as a social impact pay for performance 
contract project under this subtitle, a project must produce a 
measurable, clearly defined outcome that results in social benefit and 
Federal savings through any of the following:
            ``(1) Increasing work and earnings by individuals who have 
        been unemployed in the United States for more than 6 
        consecutive months.
            ``(2) Increasing employment and earnings of individuals age 
        16 to 24.
            ``(3) Increasing employment among individuals receiving 
        Federal disability benefits.
            ``(4) Reducing the dependence of low-income families on 
        Federal means-tested benefits.
            ``(5) Improving rates of high school graduation.
            ``(6) Reducing teen and unplanned pregnancies.
            ``(7) Improving birth outcomes among low-income families 
        and individuals.
            ``(8) Reducing rates of asthma, diabetes, or other 
        preventable diseases among low-income families and individuals.
            ``(9) Increasing the proportion of children living in 2-
        parent families.
            ``(10) Reducing incidences of child abuse and neglect.
            ``(11) Reducing the number of youth in foster care who are 
        emancipated from care by increasing adoptions, permanent 
        guardianship arrangements, reunification, or placement with a 
        fit and willing relative for children and youth in foster care.
            ``(12) Reducing the number of children and youth in foster 
        care residing in group homes, child care institutions, agency-
        operated foster homes, or other non-family foster homes, unless 
        it is determined that it is in the interest of the child's 
        long-term health, safety, or psychological well-being to not be 
        placed in a family foster home.
            ``(13) Reducing recidivism among individuals released from 
        prison.
            ``(14) Other measurable outcomes defined by the State or 
        local government that result in positive social outcomes and 
        Federal savings.
    ``(c) Feasibility Study Required.--The notice described in 
subsection (a) shall require a State or local government to submit a 
feasibility study for the social impact pay for performance contract 
project that contains the following information:
            ``(1) The outcome goals of the project.
            ``(2) A description of each intervention in the project and 
        anticipated outcome of such intervention.
            ``(3) Rigorous evidence demonstrating that the intervention 
        can be expected to produce the desired outcomes.
            ``(4) The target population that will be served by the 
        project.
            ``(5) The expected social benefits to participants who 
        receive the intervention and others who may be impacted.
            ``(6) Projected Federal, State, and local government costs 
        and other costs to conduct the project.
            ``(7) Projected Federal, State, and local government 
        savings and other savings, including an estimate prepared by 
        the State or local government of the savings to the Federal, 
        State, and local government, on a program-by-program basis and 
        in the aggregate, if the project is implemented and the 
        outcomes are achieved.
            ``(8) If savings resulting from the successful completion 
        of the project are estimated to accrue to the State or local 
        government, the likelihood of the State or local government to 
        realize those savings.
            ``(9) A plan for delivering the intervention through a 
        social impact pay for performance contract model.
            ``(10) A description of the expertise of each service 
        provider that will administer the intervention.
            ``(11) An explanation of the experience of the State or 
        local government, the intermediary, or the service provider in 
        raising private and philanthropic capital to fund social 
        service investments.
            ``(12) The detailed roles and responsibilities of each 
        entity involved in the project, including any State or local 
        government entity, intermediary, service provider, independent 
        evaluator, investor, or other stakeholder.
            ``(13) A summary of the experience of the service provider 
        delivering the proposed intervention or a similar intervention, 
        or a summary demonstrating that the service provider has the 
        expertise necessary to deliver the proposed intervention.
            ``(14) A summary of the unmet need in the area where the 
        intervention will be delivered or among the target population 
        who will receive the intervention.
            ``(15) The payment terms, the methodology used to calculate 
        outcome payments, the payment schedule, and performance 
        thresholds.
            ``(16) The project budget.
            ``(17) The project timeline.
            ``(18) The criteria used to determine the eligibility of an 
        individual for the project, including how selected populations 
        will be identified, how they will be referred to the project, 
        and how they will be enrolled in the project.
            ``(19) The evaluation design.
            ``(20) The metrics that will be used to determine whether 
        the outcomes have been achieved and how such metrics will be 
        measured.
            ``(21) A summary explaining the independence of the 
        evaluator from the other entities involved in the project and 
        the evaluator's experience in conducting rigorous evaluations 
        of program effectiveness including, where available, well-
        implemented randomized controlled trials on the intervention or 
        similar interventions.
            ``(22) The capacity of the service provider to deliver the 
        intervention to the number of participants the State or local 
        government proposes to serve in the project.
    ``(d) Project Intermediary Information Required.--The feasibility 
study described in subsection (c) shall also contain the following 
information about the intermediary for the social impact pay for 
performance contract project (whether the intermediary is the service 
provider or other entity):
            ``(1) Experience and capacity for providing or facilitating 
        the provision of the type of intervention proposed.
            ``(2) The mission and goals.
            ``(3) Information on whether the intermediary is already 
        working with service providers that provide this intervention 
        or an explanation of the capacity of the intermediary to begin 
        working with service providers to provide the intervention.
            ``(4) Experience working in a collaborative environment 
        across government and nongovernmental entities.
            ``(5) Previous experience collaborating with public or 
        private entities to implement evidence-based programs.
            ``(6) Ability to raise or provide funding to cover 
        operating costs (if applicable to the project).
            ``(7) Capacity and infrastructure to track outcomes and 
        measure results, including--
                    ``(A) capacity to track and analyze program 
                performance; and
                    ``(B) experience with performance-based contracting 
                and achieving project milestones and targets.
            ``(8) Role in delivering the intervention.
            ``(9) How the intermediary would monitor program success, 
        including a description of the interim benchmarks and outcome 
        measures.

``SEC. 2053. AWARDING CONTRACTS FOR SOCIAL IMPACT PAY FOR PERFORMANCE 
              CONTRACT PROJECTS.

    ``(a) Timeline in Awarding Contract.--Not later than 6 months after 
receiving an application in accordance with section 2052, the Secretary 
shall determine whether to enter into a contract for a social impact 
pay for performance contract project with the State or local government 
that submitted such application.
    ``(b) Considerations in Awarding Contract.--In determining whether 
to enter into a contract for a social impact pay for performance 
contract project with a State or local government, the Secretary, in 
consultation with the Federal Interagency Council on Social Impact Pay 
for Performance Contracts and the head of any Federal agency 
administering a similar intervention or serving a population similar to 
that served by the project, shall consider each of the following:
            ``(1) The value to the Federal Government of the outcome 
        expected to be achieved if the outcomes specified in the 
        contract are achieved.
            ``(2) The ability of the State or local government, in 
        collaboration with the intermediary and the service providers, 
        to achieve the outcomes.
            ``(3) The savings to the Federal Government if the outcomes 
        specified in contract are achieved.
            ``(4) The savings to the State and local governments if the 
        outcomes specific in the contract are achieved.
            ``(5) The expected quality of the evaluation that would be 
        conducted with respect to the contract.
    ``(c) Contract Authority.--
            ``(1) Contract requirements.--In accordance with this 
        section, the Secretary, in consultation with the Federal 
        Interagency Council on Social Impact Pay for Performance 
        Contracts and the head of any Federal agency administering a 
        similar intervention or serving a population similar to that 
        served by the project, may enter into a contract for a social 
        impact pay for performance contract project with a State or 
        local government if the Secretary determines that each of the 
        following requirements are met:
                    ``(A) The State or local government agrees to 
                achieve an outcome specified in the contract in order 
                to receive payment.
                    ``(B) The Federal payment to the State or local 
                government for each outcome specified does not exceed 
                the monetary value of the outcome to the Federal 
                Government over a period not to exceed 10 years, as 
                determined by the Secretary, in consultation with the 
                State or local government.
                    ``(C) The duration of the project does not exceed 
                10 years.
                    ``(D) The State or local government has 
                demonstrated, through the application submitted under 
                section 2052, that, based on prior rigorous 
                experimental evaluations or rigorous quasi-experimental 
                studies, the intervention can be expected to achieve 
                each outcome specified in the contract.
                    ``(E) The State, local government, intermediary, or 
                service provider has experience raising private or 
                philanthropic capital to fund social service 
                investments (if applicable to the project).
                    ``(F) The State or local government has shown that 
                each service provider has experience delivering the 
                intervention, a similar intervention, or has otherwise 
                demonstrated the expertise necessary to deliver the 
                intervention.
            ``(2) Payment.--The Secretary shall pay the State or local 
        government only if the independent evaluator described in 
        section 2055 determines that the social impact pay for 
        performance contract project has met the requirements specified 
        in the contract and achieved an outcome specified in the 
        contract.
            ``(3) Limitation.--The Secretary shall not enter into a 
        contract for a social impact pay for performance contract 
        project under paragraph (1) after the date that is 10 years 
        after the date of the enactment of this subtitle and shall not 
        obligate any funds made available under section 2057(a) after 
        such date.
    ``(d) Notice of Contract Award.--Not later than 30 days after 
entering into a contract under this section, the Secretary shall 
publish a notice in the Federal Register that includes, with regard to 
such contract, the following:
            ``(1) The outcome goals of the social impact pay for 
        performance contract project.
            ``(2) A description of each intervention in the project.
            ``(3) The target population that will be served by the 
        project.
            ``(4) The expected social benefits to participants who 
        receive the intervention and others who may be impacted.
            ``(5) The detailed roles, responsibilities, and purposes of 
        each Federal, State, or local government entity, intermediary, 
        service provider, independent evaluator, investor, or other 
        stakeholder.
            ``(6) The payment terms, the methodology used to calculate 
        outcome payments, the payment schedule, and performance 
        thresholds.
            ``(7) The project budget.
            ``(8) The project timeline.
            ``(9) The project eligibility criteria.
            ``(10) The evaluation design.
            ``(11) The metrics that will be used to determine whether 
        the outcomes have been achieved and how these metrics will be 
        measured.
            ``(12) The estimate prepared by the State or local 
        government of the savings to the Federal, State, and local 
        government, on a program-by-program basis and in the aggregate, 
        if the contract is entered into and implemented and the 
        outcomes are achieved.

``SEC. 2054. FEASIBILITY STUDY FUNDING.

    ``(a) Requests for Funding for Feasibility Studies.--The Secretary 
shall reserve a portion of the funding provided in section 2057 to 
assist States or local governments in developing feasibility studies 
required by section 2052. To be eligible to receive funding to assist 
with completing a feasibility study, a State or local government shall 
submit an application for feasibility study funding containing the 
following information:
            ``(1) A description of the outcome goals of the social 
        impact pay for performance contract project.
            ``(2) A description of the intervention, including 
        anticipated program design, target population, an estimate 
        regarding the number of individuals to be served, and setting 
        for the intervention.
            ``(3) Evidence to support the likelihood that such 
        intervention will produce the desired outcome.
            ``(4) The expected social benefits to participants who 
        receive the intervention and others who may be impacted.
            ``(5) Estimated costs to conduct the project.
            ``(6) Estimates of Federal, State, and local government 
        savings and other savings if the project is implemented and the 
        outcomes are achieved.
            ``(7) An estimated timeline for implementation and 
        completion of the project, which shall not exceed 10 years.
            ``(8) With respect to a project for which the State or 
        local government selects an intermediary to operate the 
        project, any partnerships needed to successfully execute the 
        project and the ability of the intermediary to foster such 
        partnerships.
            ``(9) The expected resources needed to complete the 
        feasibility study for the State or local government to apply 
        for social impact pay for performance contract funding under 
        section 2052.
    ``(b) Federal Selection of Applications for Feasibility Study.--Not 
later than 6 months after receiving an application for feasibility 
study funding under subsection (a), the Secretary, in consultation with 
the Federal Interagency Council on Social Impact Pay for Performance 
Contracts and the head of any Federal agency administering a similar 
intervention or serving a population similar to that served by the 
project, shall select State or local government feasibility study 
proposals for funding based on the following:
            ``(1) The likelihood that the proposal will achieve the 
        desired outcome.
            ``(2) The value of the outcome expected to be achieved.
            ``(3) The potential savings to the Federal Government if 
        the social impact pay for performance contract project is 
        successful.
            ``(4) The potential savings to the State and local 
        governments if the project is successful.
    ``(c) Public Disclosure.--Not later than 30 days after selecting a 
State or local government for feasibility study funding under this 
section, the Secretary shall publish on the website of the Federal 
Interagency Council on Social Impact Pay for Performance Contracts 
information explaining why the State or local government was granted 
feasibility study funding.
    ``(d) Funding Restrictions; No Guarantee of Funding.--
            ``(1) Feasibility study restriction.--The Secretary shall 
        not provide feasibility study funding under this section for 
        more than 50 percent of the estimated total cost of the 
        feasibility study reported in the State or local government 
        application submitted under subsection (a).
            ``(2) Aggregate restriction.--Of the total amount 
        appropriated under section 2057, the Secretary shall not use 
        more than $10,000,000 to provide feasibility study funding to 
        States or local governments under this section.
            ``(3) No guarantee of funding.--The Secretary shall have 
        the option to award no funding under this section.
    ``(e) Submission of Feasibility Study Required.--Not later than 6 
months after the receipt of feasibility study funding under this 
section, a State or local government receiving such funding shall 
complete the feasibility study and submit the study to the Federal 
Interagency Council on Social Impact Pay for Performance Contracts.

``SEC. 2055. EVALUATIONS.

    ``(a) Contract Authority.--For each State or local government 
awarded a social impact pay for performance contract project approved 
by the Secretary under this subtitle, the head of the relevant agency, 
as determined by the Federal Interagency Council on Social Impact Pay 
for Performance Contracts, shall enter into a contract with such State 
or local government to pay for the independent evaluation required 
under section 2053(a)(2) to determine whether the State or local 
government project has met an outcome specified in the contract in 
order for the State or local government to receive outcome payments 
under this subtitle.
    ``(b) Evaluator Qualifications.--The head of the relevant agency 
may not enter into a contract with a State or local government under 
subsection (a) unless the head determines that the evaluator is 
independent of the other parties to the contract and has demonstrated 
substantial experience in conducting rigorous evaluations of program 
effectiveness including, where available and appropriate, well-
implemented randomized controlled trials on the intervention or similar 
interventions.
    ``(c) Methodologies To Be Used.--
            ``(1) In general.--Subject to paragraph (2), the evaluation 
        used to determine whether a State or local government will 
        receive outcome payments under this subtitle shall, to the 
        extent practicable, use methodologies based on experimental 
        designs using random assignment, or, when random assignment is 
        not feasible or appropriate, other reliable, evidence-based 
        research methodologies, as certified by the Federal Interagency 
        Council on Social Impact Pay for Performance Contracts, that 
        allow for the strongest possible direct, causal inferences.
            ``(2) Limitation.--In determining whether an outcome has 
        been achieved, the evaluation methodology selected under 
        paragraph (1) shall not consider indirect potential savings to 
        the Federal Government that may be realized from increased 
        income, employment, output, or other economic measures derived 
        from multiplier effects external to the outcome metrics upon 
        which contract payments are based.
            ``(3) Application of executive order 13563.--Executive 
        Order 13563 (76 Fed. Reg. 3,821; relating to regulatory review) 
        shall not apply to the development and selection of 
        methodologies under this subsection.
    ``(d) Progress Report.--
            ``(1) Submission of report.--The independent evaluator 
        shall--
                    ``(A) not later than 2 years after a project has 
                been approved by the Secretary and biannually 
                thereafter until the project is concluded, submit to 
                the head of the relevant agency and the Federal 
                Interagency Council on Social Impact Pay for 
                Performance Contracts a written report summarizing the 
                progress that has been made in achieving each outcome 
                specified in the contract; and
                    ``(B) at the scheduled time of the first outcome 
                payment and at the time of each subsequent payment, 
                submit to the head of the relevant agency and the 
                Federal Interagency Council on Social Impact Pay for 
                Performance Contracts a written report that includes 
                the results of the evaluation conducted to determine 
                whether an outcome payment should be made along with 
                information on the unique factors that contributed to 
                achieving or failing to achieve the outcome, the 
                challenges faced in attempting to achieve the outcome, 
                and information on the improved future delivery of this 
                or similar interventions.
            ``(2) Submission to congress.--Not later than 30 days after 
        receipt of the written report pursuant to paragraph (1)(B), the 
        Federal Interagency Council on Social Impact Pay for 
        Performance Contracts shall submit such report to each 
        committee of jurisdiction in the House of Representatives and 
        the Senate.
    ``(e) Final Report.--
            ``(1) Submission of report.--Within 6 months after the 
        social impact pay for performance contract project is 
        completed, the independent evaluator shall--
                    ``(A) evaluate the effects of the activities 
                undertaken pursuant to the contract with regard to each 
                outcome specified in the contract; and
                    ``(B) submit to the head of the relevant agency and 
                the Federal Interagency Council on Social Impact Pay 
                for Performance Contracts a written report that 
                includes the results of the evaluation and the 
                conclusion of the evaluator as to whether the State or 
                local government has fulfilled each obligation of the 
                contract, along with information on the unique factors 
                that contributed to the success or failure of the 
                project, the challenges faced in attempting to achieve 
                the outcome, and information on the improved future 
                delivery of this or similar interventions.
            ``(2) Submission to congress.--Not later than 30 days after 
        receipt of the written report pursuant to paragraph (1)(B), the 
        Federal Interagency Council on Social Impact Pay for 
        Performance Contracts shall submit such report to each 
        committee of jurisdiction in the House of Representatives and 
        the Senate.
    ``(f) Limitation on Cost of Evaluations.--Of the amount made 
available for social impact pay for performance contract projects in 
section 2057, the Secretary may not obligate more than 15 percent of 
such amount to evaluate the implementation and outcomes of such 
projects.

``SEC. 2056. FEDERAL INTERAGENCY COUNCIL ON SOCIAL IMPACT PAY FOR 
              PERFORMANCE CONTRACTS.

    ``(a) Establishment; Duties.--There is established the Federal 
Interagency Council on Social Impact Pay for Performance Contracts (in 
this section, referred to as the `Council'). The duties of the Council 
shall be to--
            ``(1) coordinate the efforts of social impact pay for 
        performance contract projects funded by this subtitle;
            ``(2) advise and assist the Secretary in the development 
        and implementation of such projects;
            ``(3) advise the Secretary on specific programmatic and 
        policy matter related to such projects;
            ``(4) provide subject-matter expertise to the Secretary 
        with regard to such projects;
            ``(5) ensure that each State or local government that has 
        entered into a contract with the Secretary for a social impact 
        pay for performance contract project under this subtitle and 
        each evaluator selected by the head of the relevant agency 
        under section 2055 has access to Federal administrative data to 
        assist the State or local government and the evaluator in 
        evaluating the performance and outcomes of the project;
            ``(6) provide guidance to the executive branch on the 
        future of social impact pay for performance contract projects 
        in the United States;
            ``(7) review State and local government applications for 
        social impact pay for performance contract projects to ensure 
        that contracts will only be awarded under this subtitle when 
        rigorous, independent data and reliable, evidence-based 
        research methodologies support the conclusion that a contract 
        will yield savings to the Federal Government that are equal to 
        or greater than the size of the outlay through the contract 
        before such applications are approved by the Secretary;
            ``(8) certify, in the case of each approved social impact 
        pay for performance contract project, that the project will 
        yield a projected savings to the Federal Government, and 
        coordinate with the relevant Federal agency to produce an 
        after-action accounting once the project is complete to 
        determine the actual Federal savings realized, and the extent 
        to which actual savings aligned with projected savings; and
            ``(9) provide oversight of the actions of the Secretary and 
        other Federal officials under this subtitle, and report 
        periodically to Congress and the public on the implementation 
        of this subtitle.
    ``(b) Composition of Council.--
            ``(1) Presidential appointees.--The President of the United 
        States shall select 3 members of the Council, at least 1 of 
        whom shall be an official of the Department of the Treasury and 
        at least 1 of whom shall not be an employee of the Federal 
        Government. The President shall designate 1 of these 3 members 
        as the Chair of the Council. The Chair shall serve for a term 
        of 7 years, and the other members selected by the President 
        shall serve terms of 4 and 6 years. The President shall 
        determine which member serves 4 years and which serves 6 years.
            ``(2) Additional appointees.--In addition to the 3 members 
        appointed under paragraph (1), the Council shall be further 
        composed of the following 8 members:
                    ``(A) 1 member selected by the President of the 
                United States from a list of candidates provided by the 
                Majority Leader of the Senate;
                    ``(B) 1 member selected by the President from a 
                list of candidates provided by the Minority Leader of 
                the Senate;
                    ``(C) 1 member selected by the President from a 
                list of candidates provided by the Speaker of the House 
                of Representatives;
                    ``(D) 1 member selected by the President from a 
                list of candidates provided by the Minority Leader of 
                the House of Representatives;
                    ``(E) 1 member selected by the President from a 
                list of candidates provided by the Chairman of the 
                Committee on Finance of the Senate;
                    ``(F) 1 member selected by the President from a 
                list of candidates provided by the Ranking Member of 
                the Committee on Finance of the Senate;
                    ``(G) 1 member selected by the President from a 
                list of candidates provided by the Chairman of the 
                Committee on Ways and Means of the House of 
                Representatives; and
                    ``(H) 1 member selected by the President from a 
                list of candidates provided by the Ranking Member of 
                the Committee on Ways and Means of the House of 
                Representatives.
            ``(3) Qualifications.--The membership of the Council shall 
        consist of individuals who--
                    ``(A) are experienced in finance, economics, pay 
                for performance finance or statistics;
                    ``(B) have relevant professional or personal 
                experience in a field related to 1 or more of the 
                outcomes listed in section 2052(b); and
                    ``(C) are qualified to review applications for 
                social impact pay for performance contract projects to 
                determine whether the proposed metrics and evaluation 
                methodologies are appropriately rigorous and reliant 
                upon independent data and evidence-based research.
            ``(4) Timing of appointments.--
                    ``(A) Candidate lists.--With respect to the 
                candidate lists described in paragraph (2), the 
                designated member of Congress shall provide a list of 
                candidates to the President not later than 90 days 
                after the date of the enactment of this subtitle, or, 
                in the event of a vacancy, not later than 90 days after 
                the date upon which the vacancy arises. If a member of 
                Congress fails to provide a list of candidates to the 
                President by such date, the President may select a 
                member of the President's choice on behalf of such 
                member of Congress.
                    ``(B) Appointment date.--All appointments of the 
                members of the Council shall be made not later than 120 
                days after the date of the enactment of this subtitle. 
                Notwithstanding the preceding sentence, if not all 
                appointments have been made to the Council as of such 
                date, the Council may operate with fewer than all 11 
                members until all appointments have been made.
            ``(5) Term of appointments.--
                    ``(A) In general.--The members appointed under 
                paragraph (2) shall serve as follows:
                            ``(i) 2 members shall serve for 3 years.
                            ``(ii) 2 members shall serve for 4 years.
                            ``(iii) 2 members shall serve for 5 years.
                            ``(iv) 2 members shall serve for 6 years.
                    ``(B) Assignment of terms.--The Council shall 
                designate the term length that each member appointed 
                under paragraph (2) shall serve by unanimous agreement. 
                In the event that unanimous agreement cannot be 
                reached, term lengths shall be assigned to such members 
                by a random process.
            ``(6) Vacancies.--
                    ``(A) In general.--Subject to subparagraph (B), in 
                the event of a vacancy in the Council, whether due to 
                the resignation of a member, the expiration of a 
                member's term, or any other reason, such vacancy shall 
                be filled in the manner in which the original 
                appointment was made and shall not affect the powers of 
                the Council.
                    ``(B) Political party balance rule.--If the member 
                of Congress required to provide a list of candidates 
                under paragraph (2) to fill a vacancy in a position in 
                accordance with this paragraph is not of the same 
                political party as the member of Congress providing the 
                list of candidates for the original appointment to such 
                position, the list of candidates to fill such vacancy 
                shall be provided instead by the member of the other 
                political party occupying the corresponding position in 
                the House of Congress or congressional committee 
                concerned.
            ``(7) Appointment power.--Members of the Council appointed 
        under this section shall not be subject to confirmation by the 
        Senate.
    ``(c) Rules of the Council.--
            ``(1) Charter.--The Council shall file a charter that meets 
        the requirements of section 9(c) of the Federal Advisory 
        Committee Act (5 U.S.C. App.) with the Secretary. Such charter 
        shall be published on the website the Council is required to 
        establish under section 2058.
            ``(2) Council procedures.--Section 10 of the Federal 
        Advisory Committee Act (5 U.S.C. App.), other than subsections 
        (e) and (f), shall apply to the Council.
            ``(3) Transcripts.--Section 11 of the Federal Advisory 
        Committee Act (5 U.S.C. App.) shall apply to the Council.
            ``(4) Compensation.--Members of the Council--
                    ``(A) shall not receive compensation for service on 
                the Council; and
                    ``(B) shall be allowed travel expenses, including 
                per diem in lieu of subsistence, at rates authorized 
                for employees of agencies under subchapter I of chapter 
                57 of title 5, United States Code, while away from 
                their homes or regular places of business in the 
                performance of service for the Council.
    ``(d) Agency Liaisons.--The Council shall liaise, as needed, with 
officers or employees of each Federal agency that becomes involved with 
the social impact pay for performance contract selection and obligation 
process who are designated by the head of the agency to serve as 
liaison to the Council.
    ``(e) Rule of Construction.--Nothing in this section shall give the 
Council the authority to abrogate a contract entered into by the 
Secretary under section 2053, or any payment associated with such 
contract that is payable under such section.

``SEC. 2057. FUNDING.

    ``(a) In General.--Out of any money in the Treasury not otherwise 
appropriated, there is hereby appropriated $300,000,000 to remain 
available until 10 years after the date specified in section 2053(c)(3) 
to carry out the activities authorized under this subtitle. Amounts 
appropriated under this subsection that are unobligated as of such date 
shall be rescinded on such date, except that the Secretary may retain 
an amount not to exceed $6,000,000 for an additional 3 years for 
purposes of carrying out functions necessary to administer contracts 
that were awarded under this subtitle prior to such date.
    ``(b) Limitation.--Of the amounts made available under subsection 
(a), the Secretary may not use more than $3,000,000 in any fiscal year 
to support the review, approval, and oversight of social impact pay for 
performance contract projects, including activities conducted by--
            ``(1) the Federal Interagency Council on Social Impact Pay 
        for Performance Contracts; and
            ``(2) any other agency consulted by the Secretary before 
        approving a social impact pay for performance contract project 
        or a feasibility study under section 2054.

``SEC. 2058. WEBSITE.

    ``The Federal Interagency Council on Social Impact Pay for 
Performance Contracts shall establish and maintain a public website 
that shall display the following:
            ``(1) A copy of, or method of accessing, each notice 
        published regarding a social impact pay for performance 
        contract project pursuant to this subtitle.
            ``(2) For each State or local government that has entered 
        into a contract with the Secretary for a social impact pay for 
        performance contract project, the website shall contain the 
        following information:
                    ``(A) The outcome goals of the project.
                    ``(B) A description of each intervention in the 
                project.
                    ``(C) The target population that will be served by 
                the project.
                    ``(D) The expected social benefits to participants 
                who receive the intervention and others who may be 
                impacted.
                    ``(E) The detailed roles, responsibilities, and 
                purposes of each Federal, State, or local government 
                entity, intermediary, service provider, independent 
                evaluator, investor, or other stakeholder.
                    ``(F) The payment terms, methodology used to 
                calculate outcome payments, the payment schedule, and 
                performance thresholds.
                    ``(G) The project budget.
                    ``(H) The project timeline.
                    ``(I) The project eligibility criteria.
                    ``(J) The evaluation design.
                    ``(K) The metrics used to determine whether the 
                proposed outcomes have been achieved and how these 
                metrics are measured.
            ``(3) A copy of the progress reports and the final reports 
        relating to each social impact pay for performance contract 
        project.
            ``(4) An estimate of the savings to the Federal, State, and 
        local government, on a program-by-program basis and in the 
        aggregate, resulting from the successful completion of the 
        social impact pay for performance contract project.
            ``(5) A copy of the Council's charter.

``SEC. 2059. REGULATIONS.

    ``The Secretary, in consultation with the Federal Interagency 
Council on Social Impact Pay for Performance Contracts, may issue 
regulations as necessary to carry out this subtitle.

``SEC. 2060. GAO AUDITS.

    ``(a) Authority To Audit.--The Comptroller General of the United 
States may audit the activities of any State, local government, or 
nongovernmental entity that receives funds under this subtitle.
    ``(b) Access to Information.--
            ``(1) In general.--Notwithstanding any other provision of 
        law, the Comptroller General shall, upon request and at such 
        reasonable time and in such reasonable form as the Comptroller 
        General may request, have access to--
                    ``(A) any records or other information under the 
                control of or used by any State, local government, or 
                nongovernmental entity that receives funds under this 
                subtitle;
                    ``(B) any records or other information under the 
                control of a person or entity acting on behalf of or 
                under the authority of a State, local government, or 
                nongovernmental entity that receives funds under this 
                subtitle, to the extent that such records or other 
                information is relevant to an audit under subsection 
                (a); and
                    ``(C) the officers, directors, employees, financial 
                advisors, staff, working groups, and agents and 
                representatives of any State, local government, or 
                nongovernmental entity that receives funds under this 
                subtitle (as related to the activities on behalf of 
                such State, local government, or nongovernmental entity 
                of such agent or representative), at such reasonable 
                times as the Comptroller General may request.
            ``(2) Copies.--The Comptroller General may make and retain 
        copies of such books, accounts, and other records, access to 
        which is granted under this section, as the Comptroller General 
        considers appropriate.

``SEC. 2061. DEFINITIONS.

    ``In this subtitle:
            ``(1) Agency.--The term `agency' has the meaning given that 
        term in section 551 of title 5, United States Code.
            ``(2) Intervention.--The term `intervention' means a 
        specific service delivered to achieve an impact through a 
        social impact pay for performance contract project.
            ``(3) Secretary.--The term `Secretary' means the Secretary 
        of the Treasury.
            ``(4) Social impact pay for performance contract project.--
        The term `social impact pay for performance contract project' 
        means a project that finances social services using a social 
        impact pay for performance contract model.
            ``(5) Social impact pay for performance contract model.--
        The term `social impact pay for performance contract model' 
        means a method of financing social services in which--
                    ``(A) Federal funds are awarded to a State or local 
                government only if a State or local government achieves 
                certain outcomes agreed upon by the State or local 
                government and the Secretary; and
                    ``(B) the State or local government coordinates 
                with service providers, investors (if applicable to the 
                project), and (if necessary) an intermediary to 
                identify--
                            ``(i) an intervention expected to produce 
                        the outcome;
                            ``(ii) a service provider to deliver the 
                        intervention to the target population; and
                            ``(iii) investors to fund the delivery of 
                        the intervention.
            ``(6) State.--The term `State' means each State of the 
        United States, the District of Columbia, each commonwealth, 
        territory or possession of the United States, and each 
        federally recognized Indian tribe.''.

SEC. 3. COMMUNITY REINVESTMENT ACT.

    Section 804 of the Community Reinvestment Act of 1977 (12 U.S.C. 
2903) is amended by adding at the end the following:
    ``(e) Social Impact Pay for Performance Contract Projects.--In 
assessing and taking into account, under subsection (a), the record of 
a financial institution, the appropriate Federal financial supervisory 
agency shall consider, as a factor, investments made by the financial 
institution in social impact pay for performance contract projects 
under subtitle C of title XX of the Social Security Act.''.
                                 <all>