[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[S. 4024 Introduced in Senate (IS)]
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119th CONGRESS
2d Session
S. 4024
To strengthen oversight, accountability, and recovery of Federal funds
administered through State block grants and other pass-through
mechanisms, and for other purposes.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
March 5, 2026
Mr. Scott of Florida introduced the following bill; which was read
twice and referred to the Committee on the Judiciary
_______________________________________________________________________
A BILL
To strengthen oversight, accountability, and recovery of Federal funds
administered through State block grants and other pass-through
mechanisms, 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 ``Federal Taxpayer Funds Protection
and Clawback Act''.
SEC. 2. FALSE CLAIMS ACT AMENDMENTS.
(a) Clarification of the Definition of Claim.--Section 3729 of
title 31, United States Code is amended by adding at the end the
following:
``(e) Rule of Construction.--A claim under this section includes
any request or demand for money or property in which the money or
property originates, in whole or in part, from funds appropriated or
otherwise provided by the United States, including grant award funds
distributed through a State, local government, or other
intermediary.''.
(b) State Financial Liability Involving Federal Pass-Through
Funds.--Section 3729(b) of title 31, United States Code, is amended--
(1) in paragraph (3), by striking ``; and'' and inserting a
semicolon;
(2) in paragraph (4), by striking the period and inserting
``; and''; and
(3) by adding at the end the following:
``(5) the term `person'--
``(A) except as provided in subparagraph (B), has
the meaning given in that term in section 1 of title 1,
United States Code; and
``(B) with respect to an action initiated by the
Attorney General, includes a State or local government
(or subdivision of a State).''.
(c) Mandatory Accelerated Clawback.--
(1) In general.--Subchapter III of chapter 37 of title 31,
United States Code, is amended by inserting after section 3730
the following:
``SEC. 3730A. MANDATORY INTERIM RECOVERY OF FEDERAL FUNDS.
``(a) Remittance Required.--
``(1) In general.--Not later than 180 days after written
notice from the Attorney General or Inspector General with
respect to the Attorney General initiating a civil action or
intervening in a qui tam action under section 3730 involving
Federal funds administered by a State or State agency, the
State or State agency shall remit to the Treasury of the United
States an amount equal to 100 percent of the amount of the
Federal funds at issue in the civil action or qui tam action.
``(2) Escrow.--Any funds remitted under paragraph (1) shall
be held in an escrow account until a final judgment or
settlement is made and the time for appeal has expired or any
appeal has terminated.
``(b) Disposition of Escrow Funds.--A remittance held in escrow
under subsection (a) shall be--
``(1) returned to the general fund for the purposes of
deficit reduction if the government prevails in the action or
settles the claim; or
``(2) returned to the State or State agency if the action
results in dismissal or a final judgment in favor of the
defendant.
``(c) No Prejudgment.--No remittance under subsection (a) shall be
construed as an admission of liability or guilt or have any other
bearing on the civil action or its outcome.
``(d) Mandatory.--The remittance obligation under subsection (a) is
mandatory and cannot be waived except by Act of Congress.''.
(2) Clerical amendment.--The table of sections for
subchapter III of chapter 37 of title 31, United States Code,
is amended by inserting after the item for section 3730 the
following:
``3730A. Mandatory interim recovery of Federal funds.''.
SEC. 3. CERTIFICATION OF INSPECTION AND ACCESS AUTHORITY.
As a condition of receiving Federal funds, each State shall certify
that it agrees to abide by all applicable requirements relating to
inspections, audits, record keeping, and data sharing for Federal
awards under the applicable Federal laws and regulations, including the
requirements of part 200 of title 2, Code of Federal Regulations
(commonly referred to as the ``Uniform Administrative Requirements,
Cost Principles, and Audit Requirements for Federal Awards'').
SEC. 4. DEFAULT REMEDIES FOR NONCOMPLIANCE.
(a) In General.--Unless otherwise specified in a Federal statute, a
Federal agency or pass-through entity may implement specific conditions
under section 200.208 of title 2, Code of Federal Regulations (or
successor regulation), if the recipient or subrecipient fails to comply
with the Constitution of the United States, Federal law, regulations,
or terms and conditions of the Federal award.
(b) Default Remedies.--Unless otherwise specified in a Federal
statute, if a Federal agency or pass-through entity determines that
noncompliance cannot be remedied by imposing specific conditions under
subsection (a), the Federal agency or pass-through entity may take 1 or
more of the following actions:
(1) Temporarily withhold payments until the recipient or
subrecipient takes corrective action.
(2) Disallow costs for all or part of the activity
associated with the noncompliance of the recipient or
subrecipient.
(3) Suspend or terminate the Federal award in part or in
its entirety.
(4) Initiate suspension or debarment proceedings as
authorized under part 180 of title 2, Code of Federal
Regulations (or successor regulation), and the Federal agency's
regulations, or for pass-through entities, recommend suspension
or debarment proceedings be initiated by the Federal agency.
(5) Withhold further Federal funds (including new awards or
continuation of funding) for the project or program or the
recipient or subrecipient.
(6) Pursue other legally available remedies.
SEC. 5. EMPLOYMENT LAW VIOLATIONS.
(a) Mandatory Recoupment.--If any recipient or subrecipient of
Federal funds is found, by final agency determination or court
judgment, to have violated section 274A of the Immigration and
Nationality Act (8 U.S.C. 1324a), all Federal funds provided to such
recipient or subrecipient, directly or indirectly, shall be immediately
recouped by the United States under section 3702 of title 31, United
States Code.
(b) Permanent Ineligibility.--After notice and a hearing, an entity
subject to recoupment under subsection (a) may be permanently
ineligible to receive Federal funds.
SEC. 6. RULE OF CONSTRUCTION.
Nothing in this Act shall be construed to limit--
(1) criminal prosecution under any provision of Federal or
State law; or
(2) the authority of the United States to pursue additional
civil or administrative remedies.
SEC. 7. EFFECTIVE DATE.
This Act, and the amendments made by this Act, shall take effect
180 days after the date of enactment of this Act.
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