[Congressional Record Volume 141, Number 143 (Thursday, September 14, 1995)]
[House]
[Pages H8994-H9033]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                               AMENDMENTS

  Under clause 6 of rule XXIII, proposed amendments were submitted as 
follows:
                                H.R. 927

                   Offered By: Mr. Burton of Indiana

               (Amendment in the Nature of a Substitute)

       Amendment No. 1: Strike all after the enacting clause and 
     insert the following:

     SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

       (a) Short Title.--This Act may be cited as the ``Cuban 
     Liberty and Democratic Solidarity (LIBERTAD) Act of 1995''.
       (b) Table of Contents.--The table of contents of this Act 
     is as follows:

Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Purposes.
Sec. 4. Definitions.

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        TITLE I--SEEKING SANCTIONS AGAINST THE CASTRO GOVERNMENT

Sec. 101. Statement of policy.
Sec. 102. Enforcement of the economic embargo of Cuba.
Sec. 103. Prohibition against indirect financing of the Castro 
              dictatorship.
Sec. 104. United States opposition to Cuban membership in international 
              financial institutions.
Sec. 105. United States opposition to ending the suspension of the 
              Government of Cuba from the Organization of American 
              States.
Sec. 106. Assistance by the Independent States of the former Soviet 
              Union for the Cuban Government.
Sec. 107. Television broadcasting to Cuba.
Sec. 108. Reports on assistance and commerce received by Cuba from 
              other foreign countries.
Sec. 109. Authorization of support for democratic and human rights 
              groups and international observers.
Sec. 110. Withholding of foreign assistance from countries supporting 
              nuclear plant in Cuba.
Sec. 111. Expulsion of criminals from Cuba.

          TITLE II--ASSISTANCE TO A FREE AND INDEPENDENT CUBA

Sec. 201. Policy toward a transition government and a democratically 
              elected government in Cuba.
Sec. 202. Authorization of assistance for the Cuban people.
Sec. 203. Coordination of assistance program; implementation and 
              reports to Congress; reprogramming.
Sec. 204. Termination of the economic embargo of Cuba.
Sec. 205. Requirements for a transition government.
Sec. 206. Requirements for a democratically elected government.

  TITLE III--PROTECTION OF PROPERTY RIGHTS OF UNITED STATES NATIONALS 
           AGAINST CONFISCATORY TAKINGS BY THE CASTRO REGIME

Sec. 301. Statement of policy.
Sec. 302. Liability for trafficking in property confiscated from United 
              States nationals.
Sec. 303. Determination of claims to confiscated property.
Sec. 304. Exclusivity of Foreign Claims Settlement Commission 
              certification procedure.

                 TITLE IV--EXCLUSION OF CERTAIN ALIENS

Sec. 401. Exclusion from the United States of aliens who have 
              confiscated property of United States nationals or who 
              traffic in such property.
     SEC. 2. FINDINGS.

       The Congress makes the following findings:
       (1) The economy of Cuba has experienced a decline of at 
     least 60 percent in the last 5 years as a result of--
       (A) the end of its subsidization by the former Soviet Union 
     of between 5 billion and 6 billion dollars annually;
       (B) 36 years of Communist tyranny and economic 
     mismanagement by the Castro government;
       (C) the extreme decline in trade between Cuba and the 
     countries of the former Soviet bloc; and
       (D) the stated policy of the Russian Government and the 
     countries of the former Soviet bloc to conduct economic 
     relations with Cuba on strictly commercial terms.
       (2) At the same time, the welfare and health of the Cuban 
     people have substantially deteriorated as a result of this 
     economic decline and the refusal of the Castro regime to 
     permit free and fair democratic elections in Cuba.
       (3) The Castro regime has made it abundantly clear that it 
     will not engage in any substantive political reforms that 
     would lead to democracy, a market economy, or an economic 
     recovery.
       (4) The repression of the Cuban people, including a ban on 
     free and fair democratic elections, and continuing violations 
     of fundamental human rights have isolated the Cuban regime as 
     the only completely nondemocratic government in the Western 
     Hemisphere.
       (5) As long as free elections are not held in Cuba, the 
     economic condition of the country and the welfare of the 
     Cuban people will not improve in any significant way.
       (6) The totalitarian nature of the Castro regime has 
     deprived the Cuban people of any peaceful means to improve 
     their condition and has led thousands of Cuban citizens to 
     risk or lose their lives in dangerous attempts to escape from 
     Cuba to freedom.
       (7) Radio Marti and Television Marti have both been 
     effective vehicles for providing the people of Cuba with news 
     and information and have helped to bolster the morale of the 
     people of Cuba living under tyranny.
       (8) The consistent policy of the United States towards Cuba 
     since the beginning of the Castro regime, carried out by both 
     Democratic and Republican administrations, has sought to keep 
     faith with the people of Cuba, and has been effective in 
     sanctioning the totalitarian Castro regime.
       (9) The United States has shown a deep commitment, and 
     considers it a moral obligation, to promote and protect human 
     rights and fundamental freedoms as expressed in the Charter 
     of the United Nations and in the Universal Declaration of 
     Human Rights.
       (10) The Congress has historically and consistently 
     manifested its solidarity and the solidarity of the American 
     people with the democratic aspirations of the Cuban people.
       (11) The Cuban Democracy Act of 1992 calls upon the 
     President to encourage the governments of countries that 
     conduct trade with Cuba to restrict their trade and credit 
     relations with Cuba in a manner consistent with the purposes 
     of that Act.
       (12) The 1992 FREEDOM Support Act requires that the 
     President, in providing economic assistance to Russia and the 
     emerging Eurasian democracies, take into account the extent 
     to which they are acting to ``terminate support for the 
     communist regime in Cuba, including removal of troops, 
     closing military facilities, and ceasing trade subsidies and 
     economic, nuclear, and other assistance''.
       (13) The Cuban Government engages in the illegal 
     international narcotics trade and harbors fugitives from 
     justice in the United States.
       (14) The Castro government threatens international peace 
     and security by engaging in acts of armed subversion and 
     terrorism such as the training and supplying of groups 
     dedicated to international violence.
       (15) The Castro government has utilized from its inception 
     and continues to utilize torture in various forms (including 
     by psychiatry), as well as execution, exile, confiscation, 
     political imprisonment, and other forms of terror and 
     repression, as means of retaining power.
       (16) Fidel Castro has defined democratic pluralism as 
     ``pluralistic garbage'' and continues to make clear that he 
     has no intention of tolerating the democratization of Cuban 
     society.
       (17) The Castro government holds innocent Cubans hostage in 
     Cuba by no fault of the hostages themselves solely because 
     relatives have escaped the country.
       (18) Although a signatory state to the 1928 Inter-American 
     Convention on Asylum and the International Covenant on Civil 
     and Political Rights (which protects the right to leave one's 
     own country), Cuba nevertheless surrounds embassies in its 
     capital by armed forces to thwart the right of its citizens 
     to seek asylum and systematically denies that right to the 
     Cuban people, punishing them by imprisonment for seeking to 
     leave the country and killing them for attempting to do so 
     (as demonstrated in the case of the confirmed murder of over 
     40 men, women, and children who were seeking to leave Cuba on 
     July 13, 1994).
       (19) The Castro government continues to utilize blackmail, 
     such as the immigration crisis with which it threatened the 
     United States in the summer of 1994, and other unacceptable 
     and illegal forms of conduct to influence the actions of 
     sovereign states in the Western Hemisphere in violation of 
     the Charter of the Organization of American States and other 
     international agreements and international law.
       (20) The United Nations Commission on Human Rights has 
     repeatedly reported on the unacceptable human rights 
     situation in Cuba and has taken the extraordinary step of 
     appointing a Special Rapporteur.
       (21) The Cuban Government has consistently refused access 
     to the Special Rapporteur and formally expressed its decision 
     not to ``implement so much as one comma'' of the United 
     Nations Resolutions appointing the Rapporteur.
       (22) The United Nations General Assembly passed Resolution 
     1992/70 on December 4, 1992, Resolution 1993/48/142 on 
     December 20, 1993, and Resolution 1994/49/544 on October 19, 
     1994, referencing the Special Rapporteur's reports to the 
     United Nations and condemning ``violations of human rights 
     and fundamental freedoms'' in Cuba.
       (23) Article 39 of Chapter VII of the United Nations 
     Charter provides that the United Nations Security Council 
     ``shall determine the existence of any threat to the peace, 
     breach of the peace, or act of aggression and shall make 
     recommendations, or decide what measures shall be taken . . 
     ., to maintain or restore international peace and 
     security.''.
       (24) The United Nations has determined that massive and 
     systematic violations of human rights may constitute a 
     ``threat to peace'' under Article 39 and has imposed 
     sanctions due to such violations of human rights in the cases 
     of Rhodesia, South Africa, Iraq, and the former Yugoslavia.
       (25) In the case of Haiti, a neighbor of Cuba not as close 
     to the United States as Cuba, the United States led an effort 
     to obtain and did obtain a United Nations Security Council 
     embargo and blockade against that country due to the 
     existence of a military dictatorship in power less than 3 
     years.
       (26) United Nations Security Council Resolution 940 of July 
     31, 1994, subsequently authorized the use of ``all necessary 
     means'' to restore the ``democratically elected government of 
     Haiti'', and the democratically elected government of Haiti 
     was restored to power on October 15, 1994.
       (27) The Cuban people deserve to be assisted in a decisive 
     manner to end the tyranny that has oppressed them for 36 
     years and the continued failure to do so constitutes 
     ethically improper conduct by the international community.
       (28) For the past 36 years, the Cuban Government has posed 
     and continues to pose a national security threat to the 
     United States.

     SEC. 3. PURPOSES.

       The purposes of this Act are as follows:

[[Page H 8996]]

       (1) To assist the Cuban people in regaining their freedom 
     and prosperity, as well as in joining the community of 
     democracies that are flourishing in the Western Hemisphere.
       (2) To seek international sanctions against the Castro 
     government in Cuba.
       (3) To encourage the holding of free and fair democratic 
     elections in Cuba, conducted under the supervision of 
     internationally recognized observers.
       (4) To develop a plan for furnishing assistance to a 
     transition government and, subsequently, to a democratically 
     elected government when such governments meet the eligibility 
     requirements of this Act.
       (5) To protect property rights abroad of United States 
     nationals.
       (6) To provide for the continued national security of the 
     United States in the face of continuing threats from the 
     Castro government of terrorism, theft of property from United 
     States nationals, and domestic repression from which refugees 
     flee to United States shores.

     SEC. 4. DEFINITIONS.

       As used in this Act, the following terms have the following 
     meanings:
       (1) Appropriate congressional committees.--The term 
     ``appropriate congressional committees'' means the Committee 
     on International Relations and the Committee on 
     Appropriations of the House of Representatives and the 
     Committee on Foreign Relations and the Committee on 
     Appropriations of the Senate.
       (2) Commercial activity.--The term ``commercial activity'' 
     has the meaning given that term in section 1603(d) of title 
     28, United States Code.
       (3) Confiscated.--As used in titles I and III, the term 
     ``confiscated'' refers to--
       (A) the nationalization, expropriation, or other seizure by 
     the Cuban Government of ownership or control of property, on 
     or after January 1, 1959--
       (i) without the property having been returned or adequate 
     and effective compensation provided; or
       (ii) without the claim to the property having been settled 
     pursuant to an international claims settlement agreement or 
     other mutually accepted settlement procedure; and
       (B) the repudiation by the Cuban Government of, the default 
     by the Cuban Government on, or the failure by the Cuban 
     Government to pay, on or after January 1, 1959--
       (i) a debt of any enterprise which has been nationalized, 
     expropriated, or otherwise taken by the Cuban Government;
       (ii) a debt which is a charge on property nationalized, 
     expropriated, or otherwise taken by the Cuban Government; or
       (iii) a debt which was incurred by the Cuban Government in 
     satisfaction or settlement of a confiscated property claim.
       (4) Cuban government.--(A) The term ``Cuban Government'' 
     includes the government of any political subdivision of Cuba, 
     and any agency or instrumentality of the Government of Cuba.
       (B) For purposes of subparagraph (A), the term ``agency or 
     instrumentality of the Government of Cuba'' means an agency 
     or instrumentality of a foreign state as defined in section 
     1603(b) of title 28, United States Code, with ``Cuba'' 
     substituted for ``a foreign state'' each place it appears in 
     such section.
       (5) Democratically elected government in cuba.--The term 
     ``democratically elected government in Cuba'' means a 
     government determined by the President to have met the 
     requirements of section 206.
       (6) Economic embargo of cuba.--The term ``economic embargo 
     of Cuba'' refers to the economic embargo imposed against Cuba 
     pursuant to section 620(a) of the Foreign Assistance Act of 
     1961 (22 U.S.C. 2370(a)), section 5(b) of the Trading With 
     the Enemy Act (50 U.S.C. App. 5(b)), the International 
     Emergency Economic Powers Act (50 U.S.C. 1701 and following), 
     and the Export Administration Act of 1979 (50 U.S.C. App. 
     2401 and following), as modified by the Cuban Democracy Act 
     of 1992 (22 U.S.C. 6001 and following).
       (7) Foreign national.--The term ``foreign national'' 
     means--
       (A) an alien; or
       (B) any corporation, trust, partnership, or other juridical 
     entity not organized under the laws of the United States, or 
     of any State, the District of Columbia, the Commonwealth of 
     Puerto Rico, or any other territory or possession of the 
     United States.
       (8) Knowingly.--The term ``knowingly'' means with knowledge 
     or having reason to know.
       (9) Property.--(A) The term ``property'' means any property 
     (including patents, copyrights, trademarks, and any other 
     form of intellectual property), whether real, personal, or 
     mixed, and any present, future, or contingent right, 
     security, or other interest therein, including any leasehold 
     interest.
       (B) For purposes of title III of this Act, the term 
     ``property'' shall not include real property used for 
     residential purposes unless, as of the date of the enactment 
     of this Act--
       (i) the claim to the property is owned by a United States 
     national and the claim has been certified under title V of 
     the International Claims Settlement Act of 1949; or
       (ii) the property is occupied by a member or official of 
     the Cuban Government or the ruling political party in Cuba.
       (10) Traffics.--(A) As used in title III, a person or 
     entity ``traffics'' in property if that person or entity 
     knowingly and intentionally--
       (i) sells, transfers, distributes, dispenses, brokers, 
     manages, or otherwise disposes of confiscated property, or 
     purchases, leases, receives, possesses, obtains control of, 
     manages, uses, or otherwise acquires or holds an interest in 
     confiscated property,
       (ii) engages in a commercial activity using or otherwise 
     benefiting from confiscated property, or
       (iii) causes, directs, participates in, or profits from, 
     trafficking (as described in clauses (i) and (ii)) by another 
     person, or otherwise engages in trafficking (as described in 
     clauses (i) and (ii)) through another person,

     without the authorization of the United States national who 
     holds a claim to the property.
       (B) The term ``traffics'' does not include--
       (i) the delivery of international telecommunication signals 
     to Cuba that are authorized by section 1705(e) of the Cuban 
     Democracy Act of 1992 (22 U.S.C. 6004(e)); or
       (ii) the trading or holding of securities publicly traded 
     or held, unless the trading is with or by a person determined 
     by the Secretary of the Treasury to be a specially designated 
     national.
       (11) Transition government in cuba.--The term ``transition 
     government in Cuba'' means a government determined by the 
     President to have met the requirements of section 205.
       (12) United states national.--The term ``United States 
     national'' means--
       (A) any United States citizen; or
       (B) any other legal entity which is organized under the 
     laws of the United States, or of any State, the District of 
     Columbia, the Commonwealth of Puerto Rico, or any other 
     territory or possession of the United States, and which has 
     its principal place of business in the United States.
        TITLE I--SEEKING SANCTIONS AGAINST THE CASTRO GOVERNMENT

     SEC. 101. STATEMENT OF POLICY.

       It is the sense of the Congress that--
       (1) the acts of the Castro government, including its 
     massive, systematic, and extraordinary violations of human 
     rights, are a threat to international peace;
       (2) the President should advocate, and should instruct the 
     United States Permanent Representative to the United Nations 
     to propose and seek, within the Security Council, a mandatory 
     international embargo against the totalitarian Cuban 
     Government pursuant to chapter VII of the Charter of the 
     United Nations, which is similar to measures taken by United 
     States representatives with respect to Haiti; and
       (3) any resumption or commencement of efforts by any state 
     to make operational the nuclear facility at Cienfuegos, Cuba, 
     will have a detrimental impact on United States assistance to 
     and relations with that state.

     SEC. 102. ENFORCEMENT OF THE ECONOMIC EMBARGO OF CUBA.

       (a) Policy.--(1) The Congress hereby reaffirms section 
     1704(a) of the Cuban Democracy Act of 1992 that states the 
     President should encourage foreign countries to restrict 
     trade and credit relations with Cuba.
       (2) The Congress further urges the President to take 
     immediate steps to apply the sanctions described in section 
     1704(b) of that Act against countries assisting Cuba.
       (b) Diplomatic Efforts.--The Secretary of State shall 
     ensure that United States diplomatic personnel abroad 
     understand and, in their contacts with foreign officials, are 
     communicating the reasons for the United States economic 
     embargo of Cuba, and are urging foreign governments to 
     cooperate more effectively with the embargo.
       (c) Existing Regulations.--The President should instruct 
     the Secretary of the Treasury and the Attorney General to 
     enforce fully the Cuban Assets Control Regulations set forth 
     in part 515 of title 31, Code of Federal Regulations.
       (d) Trading With the Enemy Act.--
       (1) Civil penalties.--Subsection (b) of section 16 of the 
     Trading With the Enemy Act (50 U.S.C. App. 16(b)) is amended 
     to read as follows:
       ``(b)(1) A civil penalty of not to exceed $50,000 may be 
     imposed by the Secretary of the Treasury on any person who 
     violates any license, order, rule, or regulation issued in 
     compliance with the provisions of this Act.
       ``(2) Any property, funds, securities, papers, or other 
     articles or documents, or any vessel, together with its 
     tackle, apparel, furniture, and equipment, that is the 
     subject of a violation under paragraph (1) shall, at the 
     discretion of the Secretary of the Treasury, be forfeited to 
     the United States Government.
       ``(3) The penalties provided under this subsection may not 
     be imposed for--
       ``(A) news gathering, research, or the export or import of, 
     or transmission of, information or informational materials; 
     or
       ``(B) clearly defined educational or religious activities, 
     or activities of recognized human rights organizations, that 
     are reasonably limited in frequency, duration, and number of 
     participants.
       ``(4) The penalties provided under this subsection may be 
     imposed only on the record after opportunity for an agency 
     hearing in accordance with sections 554 through 557 of title 
     5, United States Code, with the right to prehearing 
     discovery.
       ``(5) Judicial review of any penalty imposed under this 
     subsection may be had to the extent provided in section 702 
     of title 5, United States Code.''.
       (2) Forfeiture of property used in violation.--Section 16 
     of the Trading With the 

[[Page H 8997]]
     Enemy Act is further amended by striking subsection (c).
       (3) Clerical amendment.--Section 16 of the Trading With the 
     Enemy Act is further amended by inserting ``Sec. 16.'' before 
     ``(a)''.
       (e) Coverage of Debt-for-Equity Swaps by Economic Embargo 
     of Cuba.--Section 1704(b)(2) of the Cuban Democracy Act of 
     1992 (22 U.S.C. 6003(b)(2)) is amended--
       (1) by striking ``and'' at the end of subparagraph (A);
       (2) by redesignating subparagraph (B) as subparagraph (C); 
     and
       (3) by inserting after subparagraph (A) the following new 
     subparagraph:
       ``(B) includes an exchange, reduction, or forgiveness of 
     Cuban debt owed to a foreign country in return for a grant of 
     an equity interest in a property, investment, or operation of 
     the Government of Cuba (including the government of any 
     political subdivision of Cuba, and any agency or 
     instrumentality of the Government of Cuba) or of a Cuban 
     national; and''; and
       (4) by adding at the end the following flush sentence:
     ``As used in this paragraph, the term `agency or 
     instrumentality of the Government of Cuba' means an agency or 
     instrumentality of a foreign state as defined in section 
     1603(b) of title 28, United States Code, with `Cuba' 
     substituted for `a foreign state' each place it appears in 
     such section.''.

     SEC. 103. PROHIBITION AGAINST INDIRECT FINANCING OF THE 
                   CASTRO DICTATORSHIP.

       (a) Prohibition.--Notwithstanding any other provision of 
     law, no loan, credit, or other financing may be extended 
     knowingly by a United States national, permanent resident 
     alien, or United States agency, to a foreign national, United 
     States national, or permanent resident alien, in order to 
     finance transactions involving any confiscated property the 
     claim to which is owned by a United States national as of the 
     date of the enactment of this Act.
       (b) Termination of Prohibition.--The prohibition of 
     subsection (a) shall cease to apply on the date on which the 
     economic embargo of Cuba terminates under section 205.
       (c) Penalties.--Violations of subsection (a) shall be 
     punishable by the same penalties as are applicable to 
     violations of the Cuban Assets Control Regulations set forth 
     in part 515 of title 31, Code of Federal Regulations.
       (d) Definitions.--As used in this section--
       (1) the term ``permanent resident alien'' means an alien 
     admitted for permanent residence into the United States; and
       (2) the term ``United States agency'' has the meaning given 
     the term ``agency'' in section 551(1) of title 5, United 
     States Code.
     SEC. 104. UNITED STATES OPPOSITION TO CUBAN MEMBERSHIP IN 
                   INTERNATIONAL FINANCIAL INSTITUTIONS.

       (a) Continued Opposition to Cuban Membership in 
     International Financial Institutions.--(1) Except as provided 
     in paragraph (2), the Secretary of the Treasury shall 
     instruct the United States executive director to each 
     international financial institution to use the voice and vote 
     of the United States to oppose the admission of Cuba as a 
     member of that institution until the President submits a 
     determination under section 203(c)(3) that a democratically 
     elected government in Cuba is in power.
       (2) Once the President submits a determination under 
     section 203(c)(1) that a transition government in Cuba is in 
     power, the President is encouraged to take steps to support 
     the processing of Cuba's application for membership in any 
     international financial institution, subject to the 
     membership taking effect after a democratically elected 
     government in Cuba is in power.
       (b) Reduction in United States Payments to International 
     Financial Institutions.--If any international financial 
     institution approves a loan or other assistance to the Cuban 
     Government over the opposition of the United States, then the 
     Secretary of the Treasury shall withhold from payment to that 
     institution an amount equal to the amount of the loan or 
     other assistance to the Cuban Government, with respect to 
     each of the following types of payment:
       (1) The paid-in portion of the increase in capital stock of 
     the institution.
       (2) The callable portion of the increase in capital stock 
     of the institution.
       (c) Definition.--For purposes of this section, the term 
     ``international financial institution'' means the 
     International Monetary Fund, the International Bank for 
     Reconstruction and Development, the International Development 
     Association, the International Finance Corporation, the 
     Multilateral Investment Guaranty Agency, and the Inter-
     American Development Bank.

     SEC. 105. UNITED STATES OPPOSITION TO ENDING THE SUSPENSION 
                   OF THE GOVERNMENT OF CUBA FROM THE ORGANIZATION 
                   OF AMERICAN STATES.

       The President should instruct the United States Permanent 
     Representative to the Organization of American States to use 
     the voice and vote of the United States to oppose ending the 
     suspension of the Government of Cuba from the Organization 
     until the President determines under section 203(c)(3) that a 
     democratically elected government in Cuba is in power.
     SEC. 106. ASSISTANCE BY THE INDEPENDENT STATES OF THE FORMER 
                   SOVIET UNION FOR THE CUBAN GOVERNMENT.

       (a) Reporting Requirement.--Not later than 90 days after 
     the date of the enactment of this Act, the President shall 
     submit to the appropriate congressional committees a report 
     detailing progress towards the withdrawal of personnel of any 
     independent state of the former Soviet Union (within the 
     meaning of section 3 of the FREEDOM Support Act (22 U.S.C. 
     5801)), including advisers, technicians, and military 
     personnel, from the Cienfuegos nuclear facility in Cuba.
       (b) Criteria for Assistance.--Section 498A(a)(11) of the 
     Foreign Assistance Act of 1961 (22 U.S.C. 2295a(a)(11)) is 
     amended by striking ``of military facilities'' and inserting 
     ``military and intelligence facilities, including the 
     military and intelligence facilities at Lourdes and 
     Cienfuegos''.
       (c) Ineligibility for Assistance.--(1) Section 498A(b) of 
     that Act (22 U.S.C. 2295a(b)) is amended--
       (A) by striking ``or'' at the end of paragraph (4);
       (B) by redesignating paragraph (5) as paragraph (6); and
       (C) by inserting after paragraph (4) the following:
       ``(5) for the government of any independent state effective 
     30 days after the President has determined and certified to 
     the appropriate congressional committees (and Congress has 
     not enacted legislation disapproving the determination within 
     that 30-day period) that such government is providing 
     assistance for, or engaging in nonmarket based trade (as 
     defined in section 498B(k)(3)) with, the Cuban Government; 
     or''.
       (2) Subsection (k) of section 498B of that Act (22 U.S.C. 
     2295b(k)), is amended by adding at the end the following:
       ``(3) Nonmarket based trade.--As used in section 
     498A(b)(5), the term `nonmarket based trade' includes 
     exports, imports, exchanges, or other arrangements that are 
     provided for goods and services (including oil and other 
     petroleum products) on terms more favorable than those 
     generally available in applicable markets or for comparable 
     commodities, including--
       ``(A) exports to the Cuban Government on terms that involve 
     a grant, concessional price, guaranty, insurance, or subsidy;
       ``(B) imports from the Cuban Government at preferential 
     tariff rates;
       ``(C) exchange arrangements that include advance delivery 
     of commodities, arrangements in which the Cuban Government is 
     not held accountable for unfulfilled exchange contracts, and 
     arrangements under which Cuba does not pay appropriate 
     transportation, insurance, or finance costs; and
       ``(D) the exchange, reduction, or forgiveness of Cuban debt 
     in return for a grant by the Cuban Government of an equity 
     interest in a property, investment, or operation of the Cuban 
     Government or of a Cuban national.
       ``(4) Cuban government.--(A) The term `Cuban Government' 
     includes the government of any political subdivision of Cuba, 
     and any agency or instrumentality of the Government of Cuba.
       ``(B) For purposes of subparagraph (A), the term `agency or 
     instrumentality of the Government of Cuba' means an agency or 
     instrumentality of a foreign state as defined in section 
     1603(b) of title 28, United States Code, with `Cuba' 
     substituted for `a foreign state' each place it appears in 
     such section.''.
       (d) Facilities at Lourdes, Cuba.--(1) The Congress 
     expresses its strong disapproval of the extension by Russia 
     of credits equivalent to approximately $200,000,000 in 
     support of the intelligence facility at Lourdes, Cuba, in 
     November 1994.
       (2) Section 498A of the Foreign Assistance Act of 1961 (22 
     U.S.C. 2295a) is amended by adding at the end the following 
     new subsection:
       ``(d) Reduction in Assistance for Support of Intelligence 
     Facilities in Cuba.--(1) Notwithstanding any other provision 
     of law, the President shall withhold from assistance 
     provided, on or after the date of the enactment of this 
     subsection, for an independent state of the former Soviet 
     Union under this chapter an amount equal to the sum of 
     assistance and credits, if any, provided on or after such 
     date by such state in support of intelligence facilities in 
     Cuba, including the intelligence facility at Lourdes, Cuba.
       ``(2)(A) The President may waive the requirement of 
     paragraph (1) to withhold assistance if the President 
     certifies to the appropriate congressional committees that 
     the provision of such assistance is important to the national 
     security of the United States, and, in the case of such a 
     certification made with respect to Russia, if the President 
     certifies that the Russian Government has assured the United 
     States Government that the Russian Government is not sharing 
     intelligence data collected at the Lourdes facility with 
     officials or agents of the Cuban Government.
       ``(B) At the time of a certification made with respect to 
     Russia pursuant to subparagraph (A), the President shall also 
     submit to the appropriate congressional committees a report 
     describing the intelligence activities of Russia in Cuba, 
     including the purposes for which the Lourdes facility is used 
     by the Russian Government and the extent to which the Russian 
     Government provides payment or government credits to the 
     Cuban Government for the continued use of the Lourdes 
     facility.
       ``(C) The report required by subparagraph (B) may be 
     submitted in classified form.
       ``(D) For purposes of this paragraph, the term `appropriate 
     congressional committees' includes the Permanent Select 
     Committee on Intelligence of the House of Representatives and 
     the Select Committee on Intelligence of the Senate.
       ``(3) The requirement of paragraph (1) to withhold 
     assistance shall not apply with respect to--

[[Page H 8998]]

       ``(A) assistance to meet urgent humanitarian needs, 
     including disaster and refugee relief;
       ``(B) democratic political reform and rule of law 
     activities;
       ``(C) technical assistance for safety upgrades of civilian 
     nuclear power plants;
       ``(D) the creation of private sector and nongovernmental 
     organizations that are independent of government control;
       ``(E) the development of a free market economic system; and
       ``(F) assistance for the purposes described in the 
     Cooperative Threat Reduction Act of 1993 (title XII of Public 
     Law 103-160).''.
     SEC. 107. TELEVISION BROADCASTING TO CUBA.

       (a) Conversion to UHF.--The Director of the United States 
     Information Agency shall implement a conversion of television 
     broadcasting to Cuba under the Television Marti Service to 
     ultra high frequency (UHF) broadcasting.
       (b) Periodic Reports.--Not later than 45 days after the 
     date of the enactment of this Act, and every three months 
     thereafter until the conversion described in subsection (a) 
     is fully implemented, the Director of the United States 
     Information Agency shall submit a report to the appropriate 
     congressional committees on the progress made in carrying out 
     subsection (a).
       (c) Termination of Broadcasting Authorities.--Upon 
     transmittal of a determination under section 203(c)(3), the 
     Television Broadcasting to Cuba Act (22 U.S.C. 1465aa and 
     following) and the Radio Broadcasting to Cuba Act (22 U.S.C. 
     1465 and following) are repealed.

     SEC. 108. REPORTS ON ASSISTANCE AND COMMERCE RECEIVED BY CUBA 
                   FROM OTHER FOREIGN COUNTRIES.

       (a) Reports Required.--Not later than 90 days after the 
     date of the enactment of this Act, and every year thereafter, 
     the President shall submit a report to the appropriate 
     congressional committees on assistance and commerce received 
     by Cuba from other foreign countries during the preceding 12-
     month period.
       (b) Contents of Reports.--Each report required by 
     subsection (a) shall, for the period covered by the report, 
     contain the following, to the extent such information is 
     known:
       (1) A description of all bilateral assistance provided to 
     Cuba by other foreign countries, including humanitarian 
     assistance.
       (2) A description of Cuba's commerce with foreign 
     countries, including an identification of Cuba's trading 
     partners and the extent of such trade.
       (3) A description of the joint ventures completed, or under 
     consideration, by foreign nationals involving facilities in 
     Cuba, including an identification of the location of the 
     facilities involved and a description of the terms of 
     agreement of the joint ventures and the names of the parties 
     that are involved.
       (4) A determination whether or not any of the facilities 
     described in paragraph (3) is the subject of a claim by a 
     United States national.
       (5) A determination of the amount of Cuban debt owed to 
     each foreign country, including--
       (A) the amount of debt exchanged, forgiven, or reduced 
     under the terms of each investment or operation in Cuba 
     involving foreign nationals; and
       (B) the amount of debt owed to the foreign country that has 
     been exchanged, reduced, or forgiven in return for a grant by 
     the Cuban Government of an equity interest in a property, 
     investment, or operation of the Cuban Government or of a 
     Cuban national.
       (6) A description of the steps taken to ensure that raw 
     materials and semifinished or finished goods produced by 
     facilities in Cuba involving foreign nationals do not enter 
     the United States market, either directly or through third 
     countries or parties.
       (7) An identification of countries that purchase, or have 
     purchased, arms or military supplies from the Cuban 
     Government or that otherwise have entered into agreements 
     with the Cuban Government that have a military application, 
     including--
       (A) a description of the military supplies, equipment, or 
     other materiel sold, bartered, or exchanged between the Cuban 
     Government and such countries;
       (B) a listing of the goods, services, credits, or other 
     consideration received by the Cuban Government in exchange 
     for military supplies, equipment, or materiel; and
       (C) the terms or conditions of any such agreement.

     SEC. 109. AUTHORIZATION OF SUPPORT FOR DEMOCRATIC AND HUMAN 
                   RIGHTS GROUPS AND INTERNATIONAL OBSERVERS.

       (a) Authorization.--Notwithstanding any other provision of 
     law, except for section 634A of the Foreign Assistance Act of 
     1961 (22 U.S.C. 2394-1) and comparable notification 
     requirements contained in any Act making appropriations for 
     foreign operations, export financing, and related programs, 
     the President is authorized to furnish assistance and provide 
     other support for individuals and independent nongovernmental 
     organizations to support democracy-building efforts for Cuba, 
     including the following:
       (1) Published and informational matter, such as books, 
     videos, and cassettes, on transitions to democracy, human 
     rights, and market economies, to be made available to 
     independent democratic groups in Cuba.
       (2) Humanitarian assistance to victims of political 
     repression, and their families.
       (3) Support for democratic and human rights groups in Cuba.
       (4) Support for visits and permanent deployment of 
     independent international human rights monitors in Cuba.
       (b) OAS Emergency Fund.--(1) The President shall take the 
     necessary steps to encourage the Organization of American 
     States to create a special emergency fund for the explicit 
     purpose of deploying human rights observers, election 
     support, and election observation in Cuba.
       (2) The President should instruct the United States 
     Permanent Representative to the Organization of American 
     States to encourage other member states of the Organization 
     to join in calling for the Cuban Government to allow the 
     immediate deployment of independent human rights monitors of 
     the Organization throughout Cuba and on-site visits to Cuba 
     by the Inter-American Commission on Human Rights.
       (3) Notwithstanding section 307 of the Foreign Assistance 
     Act of 1961 (22 U.S.C. 2227) or any other provision of law 
     limiting the United States proportionate share of assistance 
     to Cuba by any international organization, the President 
     should provide not less than $5,000,000 of the voluntary 
     contributions of the United States to the Organization of 
     American States as of the date of the enactment of this Act 
     solely for the purposes of the special fund referred to in 
     paragraph (1).
     SEC. 110. WITHHOLDING OF FOREIGN ASSISTANCE FROM COUNTRIES 
                   SUPPORTING NUCLEAR PLANT IN CUBA.

       (a) Findings.--The Congress makes the following findings:
       (1) President Clinton stated in April 1993 that ``the 
     United States opposes the construction of the Juragua nuclear 
     power plant because of our concerns about Cuba's ability to 
     ensure the safe operation of the facility and because of 
     Cuba's refusal to sign the Nuclear Non-Proliferation Treaty 
     or ratify the Treaty of Tlatelolco.''.
       (2) Cuba has not signed the Treaty on the Non-Proliferation 
     of Nuclear Weapons or ratified the Treaty of Tlatelolco, the 
     latter of which establishes Latin America and the Caribbean 
     as a nuclear weapons-free zone.
       (3) The State Department, the Nuclear Regulatory 
     Commission, and the Department of Energy have expressed 
     concerns about the construction and operation of Cuba's 
     nuclear reactors.
       (4) In a September 1992 report to Congress, the General 
     Accounting Office outlined concerns among nuclear energy 
     experts about deficiencies in the nuclear plant project in 
     Juragua, near Cienfuegos, Cuba, including--
       (A) a lack in Cuba of a nuclear regulatory structure;
       (B) the absence in Cuba of an adequate infrastructure to 
     ensure the plant's safe operation and requisite maintenance;
       (C) the inadequacy of training of plant operators;
       (D) reports by a former technician from Cuba who, by 
     examining with x-rays weld sites believed to be part of the 
     auxiliary plumbing system for the plant, found that 10 to 15 
     percent of those sites were defective;
       (E) since September 5, 1992, when construction on the plant 
     was halted, the prolonged exposure to the elements, including 
     corrosive salt water vapor, of the primary reactor 
     components; and
       (F) the possible inadequacy of the upper portion of the 
     reactors' dome retention capability to withstand only 7 
     pounds of pressure per square inch, given that normal 
     atmospheric pressure is 32 pounds per square inch and United 
     States reactors are designed to accommodate pressures of 50 
     pounds per square inch.
       (5) The United States Geological Survey claims that it had 
     difficulty determining answers to specific questions 
     regarding earthquake activity in the area near Cienfuegos 
     because the Cuban Government was not forthcoming with 
     information.
       (6) The Geological Survey has indicated that the Caribbean 
     plate, a geological formation near the south coast of Cuba, 
     may pose seismic risks to Cuba and the site of the power 
     plant, and may produce large to moderate earthquakes.
       (7) On May 25, 1992, the Caribbean plate produced an 
     earthquake numbering 7.0 on the Richter scale.
       (8) According to a study by the National Oceanic and 
     Atmospheric Administration, summer winds could carry 
     radioactive pollutants from a nuclear accident at the power 
     plant throughout all of Florida and parts of the States on 
     the gulf coast as far as Texas, and northern winds could 
     carry the pollutants as far northeast as Virginia and 
     Washington, D.C.
       (9) The Cuban Government, under dictator Fidel Castro, in 
     1962 advocated the Soviets' launching of nuclear missiles to 
     the United States, which represented a direct and dangerous 
     provocation of the United States and brought the world to the 
     brink of a nuclear conflict.
       (10) Fidel Castro over the years has consistently issued 
     threats against the United States Government, most recently 
     that he would unleash another perilous mass migration from 
     Cuba upon the enactment of this Act.
       (11) Despite the various concerns about the plant's safety 
     and operational problems, a feasibility study is being 
     conducted that would establish a support group to include 
     Russia, Cuba, and third countries with the objective of 
     completing and operating the plant.
       (b) Withholding of Foreign Assistance.--
       (1) In general.--Notwithstanding any other provision of 
     law, the President shall withhold from assistance allocated, 
     on or 

[[Page H 8999]]
     after the date of the enactment of this Act, for any country an amount 
     equal to the sum of assistance and credits, if any, provided 
     on or after such date of enactment by that country or any 
     entity in that country in support of the completion of the 
     Cuban nuclear facility at Juragua, near Cienfuegos, Cuba.
       (2) Exceptions.--The requirement of paragraph (1) to 
     withhold assistance shall not apply with respect to--
       (A) assistance to meet urgent humanitarian needs, including 
     disaster and refugee relief;
       (B) democratic political reform and rule of law activities;
       (C) the creation of private sector and nongovernmental 
     organizations that are independent of government control;
       (D) the development of a free market economic system; and
       (E) assistance for the purposes described in the 
     Cooperative Threat Reduction Act of 1993 (title XII of Public 
     Law 103-160).
       (3) Definition.--As used in paragraph (1), the term 
     ``assistance'' means assistance under the Foreign Assistance 
     Act of 1961, credits, sales, and guarantees of extensions of 
     credit under the Arms Export Control Act, assistance under 
     titles I and III of the Agricultural Trade Development and 
     Assistance Act of 1954, assistance under the FREEDOM Support 
     Act of 1992, and any other program of assistance or credits 
     provided by the United States to other countries under other 
     provisions of law, except that the term ``assistance'' does 
     not include humanitarian assistance, including disaster 
     relief assistance.

     SEC. 111. EXPULSION OF CRIMINALS FROM CUBA.

       The President shall instruct all United States Government 
     officials who engage in official conduct with the Cuban 
     Government to raise on a regular basis the extradition of or 
     rendering to the United States all persons residing in Cuba 
     who are sought by the United States Department of Justice for 
     crimes committed in the United States.
          TITLE II--ASSISTANCE TO A FREE AND INDEPENDENT CUBA

     SEC. 201. POLICY TOWARD A TRANSITION GOVERNMENT AND A 
                   DEMOCRATICALLY ELECTED GOVERNMENT IN CUBA.

       The policy of the United States is as follows:
       (1) To support the self-determination of the Cuban people.
       (2) To recognize that the self-determination of the Cuban 
     people is a sovereign and national right of the citizens of 
     Cuba which must be exercised free of interference by the 
     government of any other country.
       (3) To encourage the Cuban people to empower themselves 
     with a government which reflects the self-determination of 
     the Cuban people.
       (4) To recognize the potential for a difficult transition 
     from the current regime in Cuba that may result from the 
     initiatives taken by the Cuban people for self-determination 
     in response to the intransigence of the Castro regime in not 
     allowing any substantive political or economic reforms, and 
     to be prepared to provide the Cuban people with humanitarian, 
     developmental, and other economic assistance.
       (5) In solidarity with the Cuban people, to provide 
     appropriate forms of assistance--
       (A) to a transition government in Cuba;
       (B) to facilitate the rapid movement from such a transition 
     government to a democratically elected government in Cuba 
     that results from an expression of the self-determination of 
     the Cuban people; and
       (C) to support such a democratically elected government.
       (6) Through such assistance, to facilitate a peaceful 
     transition to representative democracy and a market economy 
     in Cuba and to consolidate democracy in Cuba.
       (7) To deliver such assistance to the Cuban people only 
     through a transition government in Cuba, through a 
     democratically elected government in Cuba, through United 
     States Government organizations, or through United States, 
     international, or indigenous nongovernmental organizations.
       (8) To encourage other countries and multilateral 
     organizations to provide similar assistance, and to work 
     cooperatively with such countries and organizations to 
     coordinate such assistance.
       (9) To ensure that appropriate assistance is rapidly 
     provided and distributed to the people of Cuba upon the 
     institution of a transition government in Cuba.
       (10) Not to provide favorable treatment or influence on 
     behalf of any individual or entity in the selection by the 
     Cuban people of their future government.
       (11) To assist a transition government in Cuba and a 
     democratically elected government in Cuba to prepare the 
     Cuban military forces for an appropriate role in a democracy.
       (12) To be prepared to enter into negotiations with a 
     democratically elected government in Cuba either to return 
     the United States Naval Base at Guantanamo to Cuba or to 
     renegotiate the present agreement under mutually agreeable 
     terms.
       (13) To consider the restoration of diplomatic recognition 
     and support the reintegration of the Cuban Government into 
     Inter-American organizations when the President determines 
     that there exists a democratically elected government in 
     Cuba.
       (14) To take steps to remove the economic embargo of Cuba 
     when the President determines that a transition to a 
     democratically elected government in Cuba has begun.
       (15) To assist a democratically elected government in Cuba 
     to strengthen and stabilize its national currency.
       (16) To pursue the extension of free trade arrangements to 
     a free, democratic, and independent Cuba or to seek the 
     creation of an economic community with a free, democratic, 
     and independent Cuba.

     SEC. 202. AUTHORIZATION OF ASSISTANCE FOR THE CUBAN PEOPLE.

       (a) Authorization.--
       (1) In general.--The President shall develop a plan for 
     providing economic assistance to Cuba at such time as the 
     President determines that a transition government or a 
     democratically elected government in Cuba (as determined 
     under section 203(c)) is in power.
       (2) Effect on other laws.--Assistance may be provided under 
     this section subject to an authorization of appropriations 
     and subject to the availability of appropriations.
       (b) Plan for Assistance.--
       (1) Development of plan.--The President shall develop a 
     plan for providing assistance under this section--
       (A) to Cuba when a transition government in Cuba is in 
     power; and
       (B) to Cuba when a democratically elected government in 
     Cuba is in power.
       (2) Types of assistance.--Assistance under the plan 
     developed under paragraph (1) may, subject to an 
     authorization of appropriations and subject to the 
     availability of appropriations, include the following:
       (A) Transition government.--(i) Except as provided in 
     clause (ii), assistance to Cuba under a transition government 
     shall, subject to an authorization of appropriations and 
     subject to the availability of appropriations, be limited 
     to--
       (I) such food, medicine, medical supplies and equipment, 
     and assistance to meet emergency energy needs, as is 
     necessary to meet the basic human needs of the Cuban people; 
     and
       (II) assistance described in subparagraph (C).
       (ii) Assistance provided only after the President certifies 
     to the appropriate congressional committees under the 
     procedures set forth under section 634A of the Foreign 
     Assistance Act of 1961 that such assistance is essential to 
     the successful completion of the transition to democracy.
       (iii) Only after a transition government in Cuba is in 
     power, remittances by individuals to their relatives of cash 
     or goods, as well as freedom to travel to visit them without 
     any restrictions, shall be permitted.
       (B) Democratically elected government.--Assistance to a 
     democratically elected government in Cuba may, subject to an 
     authorization of appropriations and subject to the 
     availability of appropriations, consist of additional 
     economic assistance, together with assistance described in 
     subparagraph (C). Such economic assistance may include--
       (i) assistance under chapter 1 of part I (relating to 
     development assistance), and chapter 4 of part II (relating 
     to the economic support fund), of the Foreign Assistance Act 
     of 1961;
       (ii) assistance under the Agricultural Trade Development 
     and Assistance Act of 1954;
       (iii) financing, guarantees, and other forms of assistance 
     provided by the Export-Import Bank of the United States;
       (iv) financial support provided by the Overseas Private 
     Investment Corporation for investment projects in Cuba;
       (v) assistance provided by the Trade and Development 
     Agency;
       (vi) Peace Corps programs; and
       (vii) other appropriate assistance to carry out the policy 
     of section 201.
       (C) Military adjustment assistance.--Assistance to a 
     transition government in Cuba and to a democratically elected 
     government in Cuba shall also include assistance in preparing 
     the Cuban military forces to adjust to an appropriate role in 
     a democracy.
       (c) Strategy for Distribution.--The plan developed under 
     subsection (b) shall include a strategy for distributing 
     assistance under the plan.
       (d) Distribution.--Assistance under the plan developed 
     under subsection (b) shall be provided through United States 
     Government organizations and nongovernmental organizations 
     and private and voluntary organizations, whether within or 
     outside the United States, including humanitarian, 
     educational, labor, and private sector organizations.
       (e) International Efforts.--The President shall take the 
     necessary steps--
       (1) to seek to obtain the agreement of other countries and 
     of international financial institutions and multilateral 
     organizations to provide to a transition government in Cuba, 
     and to a democratically elected government in Cuba, 
     assistance comparable to that provided by the United States 
     under this Act; and
       (2) to work with such countries, institutions, and 
     organizations to coordinate all such assistance programs.
       (f) Communication With the Cuban People.--The President 
     shall take the necessary steps to communicate to the Cuban 
     people the plan for assistance developed under this section.
       (g) Report to Congress.--Not later than 180 days after the 
     date of the enactment of this Act, the President shall 
     transmit to the appropriate congressional committees a report 
     describing in detail the plan developed under this section.
       (h) Trade and Investment Relations.--
       (1) Report to congress.--The President, following the 
     transmittal to the Congress of a determination under section 
     203(c)(3) that a democratically elected government in 

[[Page H 9000]]
     Cuba is in power, shall submit to the appropriate congressional 
     committees a report that describes--
       (A) acts, policies, and practices that constitute 
     significant barriers to, or distortions of, United States 
     trade in goods or services or foreign direct investment with 
     respect to Cuba;
       (B) policy objectives of the United States regarding trade 
     relations with a democratically elected government in Cuba, 
     and the reasons therefor, including possible--
       (i) reciprocal extension of nondiscriminatory trade 
     treatment (most-favored-nation treatment);
       (ii) designation of Cuba as a beneficiary developing 
     country under title V of the Trade Act of 1974 (relating to 
     the Generalized System of Preferences) or as a beneficiary 
     country under the Caribbean Basin Economic Recovery Act, and 
     the implications of such designation with respect to trade 
     with any other country that is such a beneficiary developing 
     country or beneficiary country or is a party to the North 
     American Free Trade Agreement; and
       (iii) negotiations regarding free trade, including the 
     accession of Cuba to the North American Free Trade Agreement;
       (C) specific trade negotiating objectives of the United 
     States with respect to Cuba, including the objectives 
     described in section 108(b)(5) of the North American Free 
     Trade Agreement Implementation Act (19 U.S.C. 3317(b)(5)); 
     and
       (D) actions proposed or anticipated to be undertaken, and 
     any proposed legislation necessary or appropriate, to achieve 
     any of such policy and negotiating objectives.
       (2) Consultations.--The President shall consult with the 
     appropriate congressional committees and shall seek advice 
     from the appropriate advisory committees established under 
     section 135 of the Trade Act of 1974 regarding the policy and 
     negotiating objectives and the legislative proposals 
     described in paragraph (1).

     SEC. 203. COORDINATION OF ASSISTANCE PROGRAM; IMPLEMENTATION 
                   AND REPORTS TO CONGRESS; REPROGRAMMING.

       (a) Coordinating Official.--The President shall designate a 
     coordinating official who shall be responsible for--
       (1) implementing the strategy for distributing assistance 
     described in section 202(b);
       (2) ensuring the speedy and efficient distribution of such 
     assistance; and
       (3) ensuring coordination among, and appropriate oversight 
     by, the agencies of the United States that provide assistance 
     described in section 202(b), including resolving any disputes 
     among such agencies.
       (b) United States-Cuba Council.--Upon making a 
     determination under subsection (c)(3) that a democratically 
     elected government in Cuba is in power, the President, after 
     consultation with the coordinating official, is authorized to 
     designate a United States-Cuba council--
       (1) to ensure coordination between the United States 
     Government and the private sector in responding to change in 
     Cuba, and in promoting market-based development in Cuba; and
       (2) to establish periodic meetings between representatives 
     of the United States and Cuban private sectors for the 
     purpose of facilitating bilateral trade.
       (c) Implementation of Plan; Reports to Congress.--
       (1) Implementation with respect to transition government.--
     Upon making a determination that a transition government in 
     Cuba is in power, the President shall transmit that 
     determination to the appropriate congressional committees and 
     shall, subject to an authorization of appropriations and 
     subject to the availability of appropriations, commence the 
     delivery and distribution of assistance to such transition 
     government under the plan developed under section 202(b).
       (2) Reports to congress.--(A) The President shall transmit 
     to the appropriate congressional committees a report setting 
     forth the strategy for providing assistance described in 
     section 202(b)(2) (A) and (C) to the transition government in 
     Cuba under the plan of assistance developed under section 
     202(b), the types of such assistance, and the extent to which 
     such assistance has been distributed in accordance with the 
     plan.
       (B) The President shall transmit the report not later than 
     90 days after making the determination referred to in 
     paragraph (1), except that the President shall transmit the 
     report in preliminary form not later than 15 days after 
     making that determination.
       (3) Implementation with respect to democratically elected 
     government.--The President shall, upon determining that a 
     democratically elected government in Cuba is in power, submit 
     that determination to the appropriate congressional 
     committees and shall, subject to an authorization of 
     appropriations and subject to the availability of 
     appropriations, commence the delivery and distribution of 
     assistance to such democratically elected government under 
     the plan developed under section 202(b).
       (4) Annual reports to congress.--Not later than 60 days 
     after the end of each fiscal year, the President shall 
     transmit to the appropriate congressional committees a report 
     on the assistance provided under the plan developed under 
     section 202(b), including a description of each type of 
     assistance, the amounts expended for such assistance, and a 
     description of the assistance to be provided under the plan 
     in the current fiscal year.
       (d) Reprogramming.--Any changes in the assistance to be 
     provided under the plan developed under section 202(b) may 
     not be made unless the President notifies the appropriate 
     congressional committees at least 15 days in advance in 
     accordance with the procedures applicable to reprogramming 
     notifications under section 634A of the Foreign Assistance 
     Act of 1961 (22 U.S.C. 2394-1).

     SEC. 204. TERMINATION OF THE ECONOMIC EMBARGO OF CUBA.

       (a) Presidential Actions.--Upon submitting a determination 
     to the appropriate congressional committees under section 
     203(c)(1) that a transition government in Cuba is in power, 
     the President, after consulting with the Congress, is 
     authorized to take steps to suspend the economic embargo of 
     Cuba to the extent that such action contributes to a stable 
     foundation for a democratically elected government in Cuba.
       (b) Suspension of Certain Provisions of Law.--In carrying 
     out subsection (a), the President may suspend the enforcement 
     of--
       (1) section 620(a) of the Foreign Assistance Act of 1961 
     (22 U.S.C. 2370(a));
       (2) section 620(f) of the Foreign Assistance Act of 1961 
     (22 U.S.C. 2370(f)) with regard to the ``Republic of Cuba'';
       (3) sections 1704, 1705(d), and 1706 of the Cuban Democracy 
     Act (22 U.S.C. 6003, 6004(d), 6005);
       (4) section 902(c) of the Food Security Act of 1985; and
       (5) the prohibitions on transactions described in part 515 
     of title 31, Code of Federal Regulations.
       (c) Additional Presidential Actions.--Upon submitting a 
     determination to the appropriate congressional committees 
     under section 203(c)(3) that a democratically elected 
     government in Cuba is in power, the President shall take 
     steps to terminate the economic embargo of Cuba.
       (d) Conforming Amendments.--On the date on which the 
     President submits a determination under section 203(c)(3)--
       (1) section 620(a) of the Foreign Assistance Act of 1961 
     (22 U.S.C. 2370(a)) is repealed;
       (2) section 620(f) of the Foreign Assistance Act of 1961 
     (22 U.S.C. 2370(f)) is amended by striking ``Republic of 
     Cuba'';
       (3) sections 1704, 1705(d), and 1706 of the Cuban Democracy 
     Act of 1992 (22 U.S.C. 6003, 6004(d), and 6005) are repealed; 
     and
       (4) section 902(c) of the Food Security Act of 1985 is 
     repealed.
       (e) Review of Suspension of Economic Embargo.--
       (1) Review.--If the President takes action under subsection 
     (a) to suspend the economic embargo of Cuba, the President 
     shall immediately so notify the Congress. The President shall 
     report to the Congress no less frequently than every 6 months 
     thereafter, until he submits a determination under section 
     203(c)(3) that a democratically elected government in Cuba is 
     in power, on the progress being made by Cuba toward the 
     establishment of such a democratically elected government. 
     The action of the President under subsection (a) shall cease 
     to be effective upon the enactment of a joint resolution 
     described in paragraph (2).
       (2) Joint resolutions.--For purposes of this subsection, 
     the term ``joint resolution'' means only a joint resolution 
     of the 2 Houses of Congress, the matter after the resolving 
     clause of which is as follows: ``That the Congress 
     disapproves the action of the President under section 204(a) 
     of the Cuban Liberty and Democratic Solidarity (LIBERTAD) Act 
     of 1995 to suspend the economic embargo of Cuba, notice of 
     which was submitted to the Congress on ____.'', with the 
     blank space being filled with the appropriate date.
       (3) Referral to committees.--Joint resolutions introduced 
     in the House of Representatives shall be referred to the 
     Committee on International Relations and joint resolutions 
     introduced in the Senate shall be referred to the Committee 
     on Foreign Relations.
       (4) Procedures.--(A) Any joint resolution shall be 
     considered in the Senate in accordance with the provisions of 
     section 601(b) of the International Security Assistance and 
     Arms Export Control Act of 1976.
       (B) For the purpose of expediting the consideration and 
     enactment of joint resolutions, a motion to proceed to the 
     consideration of any joint resolution after it has been 
     reported by the appropriate committee shall be treated as 
     highly privileged in the House of Representatives.
       (C) Not more than 1 joint resolution may be considered in 
     the House of Representatives and the Senate in the 6-month 
     period beginning on the date on which the President notifies 
     the Congress under paragraph (1) of the action taken under 
     subsection (a), and in each 6-month period thereafter.

     SEC. 205. REQUIREMENTS FOR A TRANSITION GOVERNMENT.

       For purposes of this Act, a transition government in Cuba 
     is a government in Cuba which--
       (1) is demonstrably in transition from communist 
     totalitarian dictatorship to representative democracy;
       (2) has recognized the right to independent political 
     activity and association;
       (3) has released all political prisoners and allowed for 
     investigations of Cuban prisons by appropriate international 
     human rights organizations;
       (4) has ceased any interference with Radio or Television 
     Marti broadcasts;
       (5) makes public commitments to and is making demonstrable 
     progress in--
       (A) establishing an independent judiciary;

[[Page H 9001]]

       (B) dissolving the present Department of State Security in 
     the Cuban Ministry of the Interior, including the Committees 
     for the Defense of the Revolution and the Rapid Response 
     Brigades;
       (C) respecting internationally recognized human rights and 
     basic freedoms as set forth in the Universal Declaration of 
     Human Rights, to which Cuba is a signatory nation;
       (D) effectively guaranteeing the rights of free speech and 
     freedom of the press;
       (E) organizing free and fair elections for a new 
     government--
       (i) to be held in a timely manner within a period not to 
     exceed 1 year after the transition government assumes power;
       (ii) with the participation of multiple independent 
     political parties that have full access to the media on an 
     equal basis, including (in the case of radio, television, or 
     other telecommunications media) in terms of allotments of 
     time for such access and the times of day such allotments are 
     given; and
       (iii) to be conducted under the supervision of 
     internationally recognized observers, such as the 
     Organization of American States, the United Nations, and 
     other elections monitors;
       (F) assuring the right to private property;
       (G) taking appropriate steps to return to United States 
     citizens (and entities which are 50 percent or more 
     beneficially owned by United States citizens) property taken 
     by the Cuban Government from such citizens and entities on or 
     after January 1, 1959, or to provide equitable compensation 
     to such citizens and entities for such property;
       (H) granting permits to privately owned telecommunications 
     and media companies to operate in Cuba; and
       (I) allowing the establishment of independent trade unions 
     as set forth in conventions 87 and 98 of the International 
     Labor Organization, and allowing the establishment of 
     independent social, economic, and political associations;
       (6) does not include Fidel Castro or Raul Castro;
       (7) has given adequate assurances that it will allow the 
     speedy and efficient distribution of assistance to the Cuban 
     people;
       (8) permits the deployment throughout Cuba of independent 
     and unfettered international human rights monitors; and
       (9) has extradited or otherwise rendered to the United 
     States all persons sought by the United States Department of 
     Justice for crimes committed in the United States.

     SEC. 206. REQUIREMENTS FOR A DEMOCRATICALLY ELECTED 
                   GOVERNMENT.

       For purposes of this Act, a democratically elected 
     government in Cuba, in addition to continuing to comply with 
     the requirements of section 205, is a government in Cuba 
     which--
       (1) results from free and fair elections conducted under 
     the supervision of internationally recognized observers;
       (2) has permitted opposition parties ample time to organize 
     and campaign for such elections, and has permitted full 
     access to the media to all candidates in the elections;
       (3) is showing respect for the basic civil liberties and 
     human rights of the citizens of Cuba;
       (4) has made demonstrable progress in establishing an 
     independent judiciary;
       (5) is substantially moving toward a market-oriented 
     economic system;
       (6) is committed to making constitutional changes that 
     would ensure regular free and fair elections that meet the 
     requirements of paragraph (2); and
       (7) has made demonstrable progress in returning to United 
     States citizens (and entities which are 50 percent or more 
     beneficially owned by United States citizens) property taken 
     by the Cuban Government from such citizens and entities on or 
     after January 1, 1959, or providing full compensation for 
     such property in accordance with international law standards 
     and practice.
  TITLE III--PROTECTION OF PROPERTY RIGHTS OF UNITED STATES NATIONALS 
           AGAINST CONFISCATORY TAKINGS BY THE CASTRO REGIME

     SEC. 301. STATEMENT OF POLICY.

       The Congress makes the following findings:
       (1) The right of individuals to hold and enjoy property is 
     a fundamental right recognized by the United States 
     Constitution and international human rights law, including 
     the Universal Declaration of Human Rights.
       (2) The illegal confiscation or taking of property by 
     governments, and the acquiescence of governments in the 
     confiscation of property by their citizens, undermines the 
     comity among nations, the free flow of commerce, and economic 
     development.
       (3) It is in the interest of all nations to respect equally 
     the property rights of their citizens and nationals of other 
     countries.
       (4) Nations that provide an effective mechanism for prompt, 
     adequate, and fair compensation for the confiscation of 
     private property will continue to have the support of the 
     United States.
       (5) The United States Government has an obligation to its 
     citizens to provide protection against illegal confiscation 
     by foreign nations and their citizens, including the 
     provision of private remedies.
       (6) Nations that illegally confiscate private property 
     should not be immune to another nation's laws whose purpose 
     is to protect against the confiscation of lawfully acquired 
     property by its citizens.
       (7) Trafficking in illegally acquired property is a crime 
     under the laws of the United States and other nations, yet 
     this same activity is allowed under international law.
       (8) International law, by not providing effective remedies, 
     condones the illegal confiscation of property and allows for 
     the unjust enrichment from the use of confiscated property by 
     governments and private entities at the expense of those who 
     hold legal claim to the property.
       (9) The development of an international mechanism 
     sanctioning those governments and private entities that 
     confiscate and unjustly use private property so confiscated 
     should be a priority objective of United States foreign 
     policy.
     SEC. 302. LIABILITY FOR TRAFFICKING IN PROPERTY CONFISCATED 
                   FROM UNITED STATES NATIONALS.

       (a) Civil Remedy.--
       (1) Liability for trafficking.--(A) Except as provided in 
     paragraphs (3) and (4), any person, including any agency or 
     instrumentality of a foreign state in the conduct of a 
     commercial activity, that, after the end of the 6-month 
     period beginning on the date of the enactment of this Act, 
     traffics in confiscated property shall be liable to any 
     United States national who owns the claim to such property 
     for money damages in an amount equal to the sum of--
       (i) the amount which is the greater of--
       (I) the amount, if any, certified to the claimant by the 
     Foreign Claims Settlement Commission under the International 
     Claims Settlement Act of 1949, plus interest;
       (II) the amount determined under section 303(a)(2), plus 
     interest; or
       (III) the fair market value of that property, calculated as 
     being the then current value of the property, or the value of 
     the property when confiscated plus interest, whichever is 
     greater; and
       (ii) reasonable costs and attorneys' fees.
       (B) Interest under subparagraph (A)(i) shall be at the rate 
     set forth in section 1961 of title 28, United States Code, 
     computed by the court from the date of the confiscation of 
     the property involved to the date on which the action is 
     brought under this subsection.
       (2) Presumption in favor of certified claims.--There shall 
     be a presumption that the amount for which a person, 
     including any agency or instrumentality of a foreign state in 
     the conduct of a commercial activity, is liable under clause 
     (i) of paragraph (1)(A) is the amount that is certified under 
     subclause (I) of that clause. The presumption shall be 
     rebuttable by clear and convincing evidence that the amount 
     described in subclause (II) or (III) of that clause is the 
     appropriate amount of liability under that clause.
       (3) Increased liability for prior notice.--Except as 
     provided in paragraph (4), any person, including any agency 
     or instrumentality of a foreign state in the conduct of a 
     commercial activity, that traffics in confiscated property 
     after having received--
       (A) notice of a claim to ownership of the property by a 
     United States national who owns a claim to the confiscated 
     property, and
       (B) notice of the provisions of this section,
     shall be liable to that United States national for money 
     damages in an amount which is the sum of the amount equal to 
     the amount determined under paragraph (1)(A)(ii) plus triple 
     the amount determined applicable under subclause (I), (II), 
     or (III) of paragraph (1)(A)(i).
       (4) Applicability.--(A) Except as otherwise provided in 
     this paragraph, actions may be brought under paragraph (1) 
     with respect to property confiscated before, on, or after the 
     date of the enactment of this Act.
       (B) In the case of property confiscated before the date of 
     the enactment of this Act, no United States national may 
     bring an action under this section unless such national 
     acquired ownership of the claim to the confiscated property 
     before such date.
       (C) In the case of property confiscated on or after the 
     date of the enactment of this Act, no United States national 
     who acquired ownership of a claim to confiscated property by 
     assignment for value after such date of enactment may bring 
     an action on the claim under this section.
       (5) Treatment of certain actions.--(A) In the case of any 
     action brought under this section by a United States national 
     who was eligible to file the underlying claim in the action 
     with the Foreign Claims Settlement Commission under title V 
     of the International Claims Settlement Act of 1949 but did 
     not so file the claim, the court may hear the case only if 
     the court determines that the United States national had good 
     cause for not filing the claim.
       (B) In the case of any action brought under this section by 
     a United States national whose claim in the action was timely 
     filed with the Foreign Claims Settlement Commission under 
     title V of the International Claims Settlement Act of 1949 
     but was denied by the Commission, the court may assess the 
     basis for the denial and may accept the findings of the 
     Commission on the claim as conclusive in the action under 
     this section unless good cause justifies another result.
       (6) Inapplicability of act of state doctrine.--No court of 
     the United States shall decline, based upon the act of state 
     doctrine, to make a determination on the merits in an action 
     brought under paragraph (1).
       (b) Definition.--As used in this subsection, the term 
     ``agency or instrumentality of a foreign state'' has the 
     meaning given that term in section 1603(b) of title 28, 
     United States Code.
       (c) Jurisdiction.--
       (1) In general.--Chapter 85 of title 28, United States 
     Code, is amended by inserting after section 1331 the 
     following new section:
     
[[Page H 9002]]


     ``Sec. 1331a. Civil actions involving confiscated property

       ``The district courts shall have exclusive jurisdiction of 
     any action brought under section 302 of the Cuban Liberty and 
     Democratic Solidarity (LIBERTAD) Act of 1995, regardless of 
     the amount in controversy.''.
       (2) Conforming amendment.--The table of sections for 
     chapter 85 of title 28, United States Code, is amended by 
     inserting after the item relating to section 1331 the 
     following:

``1331a. Civil actions involving confiscated property.''.

       (d) Certain Property Immune From Execution.--Section 1611 
     of title 28, United States Code, is amended by adding at the 
     end the following:
       ``(c) Notwithstanding the provisions of section 1610 of 
     this chapter, the property of a foreign state shall be immune 
     from attachment and from execution in an action brought under 
     section 302 of the Cuban Liberty and Democratic Solidarity 
     (LIBERTAD) Act of 1995 to the extent the property is a 
     facility or installation used by an accredited diplomatic 
     mission for official purposes.''.
       (e) Election of Remedies.--
       (1) Election.--Subject to paragraph (2)--
       (A) any United States national that brings an action under 
     this section may not bring any other civil action or 
     proceeding under the common law, Federal law, or the law of 
     any of the several States, the District of Columbia, or any 
     territory or possession of the United States, that seeks 
     monetary or nonmonetary compensation by reason of the same 
     subject matter; and
       (B) any person who brings, under the common law or any 
     provision of law other than this section, a civil action or 
     proceeding for monetary or nonmonetary compensation arising 
     out of a claim for which an action would otherwise be 
     cognizable under this section may not bring an action under 
     this section on that claim.
       (2) Treatment of certified claimants.--In the case of any 
     United States national that brings an action under this 
     section based on a claim certified under title V of the 
     International Claims Settlement Act of 1949--
       (A) if the recovery in the action is equal to or greater 
     than the amount of the certified claim, the United States 
     national may not receive payment on the claim under any 
     agreement entered into between the United States and Cuba 
     settling claims covered by such title, and such national 
     shall be deemed to have discharged the United States from any 
     further responsibility to represent the United States 
     national with respect to that claim;
       (B) if the recovery in the action is less than the amount 
     of the certified claim, the United States national may 
     receive payment under a claims agreement described in 
     subparagraph (A) but only to the extent of the difference 
     between the amount of the recovery and the amount of the 
     certified claim; and
       (C) if there is no recovery in the action, the United 
     States national may receive payment on the certified claim 
     under a claims agreement described in subparagraph (A) to the 
     same extent as any certified claimant who does not bring an 
     action under this section.
       (f) Deposit of Excess Payments by Cuba Under Claims 
     Agreement.--Any amounts paid by Cuba under any agreement 
     entered into between the United States and Cuba settling 
     certified claims under title V of the International Claims 
     Settlement Act of 1949 that are in excess of the payments 
     made on such certified claims after the application of 
     subsection (e) shall be deposited into the United States 
     Treasury.
       (g) Termination of Rights.--
       (1) In general.--All rights created under this section to 
     bring an action for money damages with respect to property 
     confiscated before the date of the enactment of this Act 
     shall cease upon the transmittal to the Congress of a 
     determination of the President under section 203(c)(3).
       (2) Pending suits.--The termination of rights under 
     paragraph (1) shall not affect suits commenced before the 
     date of such termination, and in all such suits, proceedings 
     shall be had, appeals taken, and judgments rendered in the 
     same manner and with the same effect as if this subsection 
     had not been enacted.

     SEC. 303. DETERMINATION OF CLAIMS TO CONFISCATED PROPERTY.

       (a) Evidence of Ownership.--
       (1) Conclusiveness of certified claims.--In any action 
     brought under this title, the courts shall accept as 
     conclusive proof of ownership a certification of a claim to 
     ownership that has been made by the Foreign Claims Settlement 
     Commission pursuant to
      title V of the International Claims Settlement Act of 1949 
     (22 U.S.C. 1643 and following).
       (2) Claims not certified.--In the case of a claim that has 
     not been certified by the Foreign Claims Settlement 
     Commission before the enactment of this Act, a court may 
     appoint a special master, including the Foreign Claims 
     Settlement Commission, to make determinations regarding the 
     amount and validity of claims to ownership of confiscated 
     property. Such determinations are only for evidentiary 
     purposes in civil actions brought under this title and do not 
     constitute certifications pursuant to title V of the 
     International Claims Settlement Act of 1949.
       (3) Effect of determinations of foreign entities.--In 
     determining ownership, courts shall not accept as conclusive 
     evidence of ownership any findings, orders, judgments, or 
     decrees from administrative agencies or courts of foreign 
     countries or international organizations that invalidate the 
     claim held by a United States national, unless the 
     invalidation was found pursuant to binding international 
     arbitration to which United States national submitted the 
     claim.
       (b) Amendment of the International Claims Settlement Act of 
     1949.--Title V of the International Claims Settlement Act of 
     1949 (22 U.S.C. 1643 and following) is amended by adding at 
     the end the following new section:


  ``evaluation of ownership claims referred by district courts of the 
                             united states

       ``Sec. 514. Notwithstanding any other provision of this 
     title and only for purposes of section 302 of the Cuban 
     Liberty and Solidarity (LIBERTAD) Act, a United States 
     district court, for fact-finding purposes, may refer to the 
     Commission, and the Commission may determine, questions of 
     the amount and ownership of a claim by a United States 
     national (as defined in section 4 of the Cuban Liberty and 
     Solidarity (LIBERTAD) Act) resulting from the confiscation of 
     property by the Government of Cuba described in section 
     503(a), whether or not the United States national qualified 
     as a national of the United States (as defined in section 
     502(1)) at the time of the action by the Government of 
     Cuba.''.
       (c) Rule of Construction.--Nothing in this Act or section 
     514 of the International Claims Settlement Act of 1949, as 
     added by subsection (b), shall be construed--
       (1) to require or otherwise authorize the claims of Cuban 
     nationals who became United States citizens after their 
     property was confiscated to be included in the claims 
     certified to the Secretary of State by the Foreign Claims 
     Settlement Commission for purposes of future negotiation and 
     espousal of claims with a friendly government in Cuba when 
     diplomatic relations are restored; or
       (2) as superseding, amending, or otherwise altering 
     certifications that have been made pursuant to title V of the 
     International Claims Settlement Act of 1949 before the 
     enactment of this Act.

     SEC. 304. EXCLUSIVITY OF FOREIGN CLAIMS SETTLEMENT COMMISSION 
                   CERTIFICATION PROCEDURE.

       Title V of the International Claims Settlement Act of 1949 
     (22 U.S.C. 1643 and following), as amended by section 303, is 
     further amended by adding at the end the following new 
     section:


  ``exclusivity of foreign claims settlement commission certification 
                               procedure

       ``Sec. 515. (a) Subject to subsection (b), neither any 
     national of the United States who was eligible to file a 
     claim under section 503 but did not timely file such claim 
     under that section, nor any national of the United States (on 
     the date of the enactment of this section) who was not 
     eligible to file a claim under that section, nor any national 
     of Cuba, including any agency, instrumentality, subdivision, 
     or enterprise of the Government of Cuba or any local 
     government of Cuba in place on the date of the enactment of 
     this section, nor any successor thereto, whether or not 
     recognized by the United States, shall have a claim to, 
     participate in, or otherwise have an interest in, the 
     compensation proceeds or other nonmonetary compensation paid 
     or allocated to a national of the United States by virtue of 
     a claim certified by the Commission under section 507, nor 
     shall any court of the United States or any State court have 
     jurisdiction to adjudicate any such claim.
       ``(b) Nothing in subsection (a) shall be construed to 
     detract from or otherwise affect any rights in the shares of 
     the capital stock of nationals of the United States owning 
     claims certified by the Commission under section 507.''.
                 TITLE IV--EXCLUSION OF CERTAIN ALIENS

     SEC. 401. EXCLUSION FROM THE UNITED STATES OF ALIENS WHO HAVE 
                   CONFISCATED PROPERTY OF UNITED STATES NATIONALS 
                   OR WHO TRAFFIC IN SUCH PROPERTY.

       (a) Grounds for Exclusion.--The Secretary of State, in 
     consultation with the Attorney General, shall exclude from 
     the United States any alien who the Secretary of State 
     determines is a person who--
       (1) has confiscated, or has directed or overseen the 
     confiscation of, property a claim to which is owned by a 
     United States national, or converts or has converted for 
     personal gain confiscated property, a claim to which is owned 
     by a United States national;
       (2) traffics in confiscated property, a claim to which is 
     owned by a United States national;
       (3) is a corporate officer, principal, or shareholder with 
     a controlling interest of an entity which has been involved 
     in the confiscation of property or trafficking in confiscated 
     property, a claim to which is owned by a United States 
     national; or
       (4) is a spouse, minor child, or agent of a person 
     excludable under paragraph (1), (2), or (3).
       (b) Definitions.--As used in this section, the following 
     terms have the following meanings:
       (1) Confiscated; confiscation.--The terms ``confiscated'' 
     and ``confiscation'' refer to--
       (A) the nationalization, expropriation, or other seizure by 
     foreign governmental authority of ownership or control of 
     property on or after January 1, 1959-- 

[[Page H 9003]]

       (i) without the property having been returned or adequate 
     and effective compensation provided; or
       (ii) without the claim to the property having been settled 
     pursuant to an international claims settlement agreement or 
     other mutually accepted settlement procedure; and
       (B) the repudiation by foreign governmental authority of, 
     the default by foreign governmental authority on, or the 
     failure by foreign governmental authority to pay, on or after 
     January 1, 1959--
       (i) a debt of any enterprise which has been nationalized, 
     expropriated, or otherwise taken by foreign governmental 
     authority;
       (ii) a debt which is a charge on property nationalized, 
     expropriated, or otherwise taken by foreign governmental 
     authority; or
       (iii) a debt which was incurred by foreign governmental 
     authority in satisfaction or settlement of a confiscated 
     property claim.
       (2) Property.--The term ``property'' does not include 
     claims arising from a territory in dispute as a result of war 
     between United Nations member states in which the ultimate 
     resolution of the disputed territory has not been resolved.
       (3) Traffics.--(A) A person or entity ``traffics'' in 
     property if that person or entity knowingly and 
     intentionally--
       (i) sells, transfers, distributes, dispenses, brokers, 
     manages, or otherwise disposes of confiscated property, or 
     purchases, leases, receives, possesses, obtains control of, 
     manages, uses, or otherwise acquires or holds an interest in 
     confiscated property,
       (ii) engages in a commercial activity using or otherwise 
     benefiting from confiscated property, or
       (iii) causes, directs, participates in, or profits from, 
     trafficking (as described in clauses (i) and (ii)) by another 
     person, or otherwise engages in trafficking (as described in 
     clauses (i) and (ii)) through another person,
     without the authorization of the United States national who 
     holds a claim to the property.
       (B) The term ``traffics'' does not include-
       (i) the delivery of international telecommunication signals 
     to Cuba that are authorized by section 1705(e) of the Cuban 
     Democracy Act of 1992 (22 U.S.C. 6004(e)); or
       (ii) the trading or holding of securities publicly traded 
     or held, unless the trading is with or by a person determined 
     by the Secretary of the Treasury to be a specially designated 
     national.
       (c) National Interest Exemption.--This section shall not 
     apply where the Secretary of State finds, on a case-by-case 
     basis, that making a determination under subsection (a) would 
     be contrary to the national interest of the United States.
       (d) Effective Date.--
       (1) In general.--This section applies to aliens seeking to 
     enter the United States on or after the date of the enactment 
     of this Act.
       (2) Trafficking.--This section applies only with respect to 
     acts within the meaning of ``traffics'' that occur on or 
     after the date of the enactment of this Act.
                               H.R. 1617

                         Offered by: Mr. McKeon

               (Amendment in the Nature of a Substitute)

       Amendment No. 1: Strike all after the enacting clause and 
     insert the following:
     SECTION 1. SHORT TITLE.

       This Act may be cited as the--
       (1) ``Consolidated and Reformed Education, Employment, and 
     Rehabilitation Systems Act''; or
       (2) ``CAREERS Act''.

     SEC. 2. TABLE OF CONTENTS.

       The table of contents for this Act is as follows:

Sec. 1. Short title.
Sec. 2. Table of contents.
Sec. 3. Purpose.
Sec. 4. Authorization of appropriations.
Sec. 5. Definitions.
Sec. 6. Transition.

             TITLE I--WORKFORCE DEVELOPMENT INFRASTRUCTURE

Sec. 101. Purpose of title.

              Subtitle A--State and Local Responsibilities

Sec. 102. State requirements.
Sec. 103. Collaborative process regarding State system.
Sec. 104. Consolidated State workforce development and literacy plan.
Sec. 105. Establishment of workforce development areas.
Sec. 106. Provisions regarding local workforce development boards.
Sec. 107. Establishment of integrated career center systems.
Sec. 108. Identification of eligible education, training, and 
              vocational rehabilitation service providers.
Sec. 109. Management information systems.
Sec. 110. Performance accountability system.
Sec. 111. Limitation on Federal regulation.
Sec. 112. General provision.
Sec. 113. Liability.

              Subtitle B--Amendments to Wagner-Peyser Act

Sec. 131. General program requirements.
Sec. 132. Labor market information.

                       Subtitle C--Worker Rights

Sec. 141. Requirements.

 TITLE II--YOUTH DEVELOPMENT AND CAREER PREPARATION CONSOLIDATION GRANT

Sec. 201. Purposes.
Sec. 202. Definitions.

                       Subtitle A--State Funding

Sec. 211. National and State funding.
Sec. 212. Within State allocation.

       Subtitle B--State Organizational, Planning, and Reporting 
                            Responsibilities

Sec. 221. State plan.
Sec. 222. State programs and State activities.
Sec. 223. Incentive awards.
Sec. 224. Core standards, performance goals, and measures.

         Subtitle C--Subgrants for In-School and At-Risk Youth

Sec. 231. Partnership agreements.
Sec. 232. Distribution of funds.

                       Chapter 1--In-School Youth

Sec. 241. Uses of funds for in-school youth.

                        Chapter 2--At-Risk Youth

Sec. 245. Uses of funds for at-risk youth.
Sec. 246. At-risk youth providers.

                     Subtitle D--National Programs

Sec. 251. Research activities.
Sec. 252. Assessment and data collection of youth development and 
              career preparation programs.
Sec. 253. National center or centers for research.

      TITLE III--ADULT EMPLOYMENT AND TRAINING CONSOLIDATION GRANT

Sec. 301. Purpose.

     Subtitle A--Adult Employment and Training Consolidation Grant

Sec. 311. Authorization.
Sec. 312. Allotment among States.
Sec. 313. Allocation within States.
Sec. 314. Additional State plan requirements.
Sec. 315. Use of amounts.
Sec. 316. Core standards, performance goals, and measures.

                      Subtitle B--Federal Programs

Sec. 321. National discretionary grants.
Sec. 322. Disaster relief employment assistance.
Sec. 323. Research, demonstration, evaluation, and capacity building.
Sec. 324. Workforce skills and development loans.
Sec. 325. Employment, training, and education assistance for Native 
              Americans.
Sec. 326. Employment, training, and education assistance for migrant 
              and seasonal farmworkers.

 TITLE IV--ADULT EDUCATION AND FAMILY LITERACY CONSOLIDATION GRANT AND 
          LIBRARY SERVICES AND TECHNOLOGY CONSOLIDATION GRANT

Sec. 401. Findings.
Sec. 402. Definitions.

  Subtitle A--Adult Education and Family Literacy Consolidation Grant

Sec. 411. Purposes.

                           Chapter 1--Funding

Sec. 421. Reservations from amounts appropriated.
Sec. 422. Allotment.

                      Chapter 2--Grants To States

Sec. 431. Requirement to make grants.
Sec. 432. Uses of funds.
Sec. 433. Additional grant requirements.
Sec. 434. Performance measures.

                      Chapter 3--National Programs

Sec. 441. National Institute for Literacy.
Sec. 442. National leadership activities.

    Subtitle B--Library Services and Technology Consolidation Grant

Sec. 451. Purposes.
Sec. 452. Authorization of appropriations.
Sec. 453. Allotments.
Sec. 454. Grants to States.
Sec. 455. Uses of funds.
Sec. 456. Annual applications.

           TITLE V--AMENDMENTS TO REHABILITATION ACT OF 1973

       Subtitle A--Vocational Rehabilitation Consolidation Grant

                      Chapter 1--Transition Period

Sec. 501. Transition.

      Chapter 2--Revision Of Title I of Rehabilitation Act of 1973

Sec. 511. Revision of title I.

       Subtitle B--Other Amendments to Rehabilitation Act of 1973

Sec. 521. Training and demonstration projects.
Sec. 522. Employment opportunities for individuals with disabilities.
Sec. 523. Certain amounts.

                TITLE VI--HIGHER EDUCATION PRIVATIZATION

Sec. 601. Reorganization of the Student Loan Marketing Association 
              through the formation of a holding company.
Sec. 602. Privatization of College Construction Loan Insurance 
              Association.

               TITLE VII--REPEALERS AND OTHER AMENDMENTS

Sec. 701. Higher education provisions.
Sec. 702. Amendment to Higher Education Act.
Sec. 703. Carl D. Perkins Vocational and Applied Technology Education 
              Act. 
Sec. 704. Smith-Hughes Act.
Sec. 705. School-to-Work Opportunities Act of 1994.
Sec. 706. School Dropout Assistance Act.
Sec. 707. Adult Education Act. 

[[Page H 9004]]

Sec. 708. National Literacy Act.
Sec. 709. Library Services and Construction Act.
Sec. 710. Technology for Education Act of 1994.
Sec. 711. Job Training Partnership Act.
Sec. 712. Stewart B. Mckinney Homeless Assistance Act.
Sec. 713. Effective date.
     SEC. 3. PURPOSE.

       The purpose of this Act is to transform the vast array of 
     Federal workforce development and literacy programs from a 
     collection of fragmented and duplicative categorical programs 
     into a streamlined, comprehensive, coherent, high-quality, 
     cost-effective, market-based, and accountable workforce 
     development and literacy system that is designed to meet the 
     education, economic, employment, and training needs of the 
     workforce and the competitiveness needs of employers of the 
     United States, both today and in the future.

     SEC. 4. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There are authorized to be appropriated--
       (1) for title II, $2,324,600,000 for fiscal year 1997 and 
     such sums as may be necessary for each of the fiscal years 
     1998 through 2002 to carry out the programs under such title;
       (2) for title III, $2,183,000,000 for fiscal year 1997 and 
     such sums as may be necessary for each of the fiscal years 
     1998 through 2002 to carry out the programs under such title; 
     and
       (3) for subtitle A of title IV, $280,000,000 for fiscal 
     year 1997 and such sums as may be necessary for each of the 
     fiscal years 1998 through 2002 to carry out the programs 
     under such subtitle.
       (b) Program Year.--
       (1) In general.--Beginning in fiscal year 1997, and each 
     year thereafter, appropriations for any fiscal year for 
     programs and activities under titles II, III, and IV of this 
     Act shall be available for obligation only on the basis of a 
     program year. The program year shall begin on July 1 in the 
     fiscal year for which the appropriation is made.
       (2) Obligation.--Funds obligated for any program year under 
     titles II, III, and IV, may be expended by each recipient 
     during that program year and the two succeeding program 
     years, except that the Secretary shall, in accordance with 
     paragraph (3), reallot to eligible States the funds allotted 
     to States from funds appropriated for reallotments.
       (3) Amounts available for reallotment.--The amount 
     available for reallotment is equal to--
       (A) the amount by which the unobligated balance of the 
     State allotment at the end of the program year prior to the 
     program year for which the determination under this section 
     is made exceeds 20 percent of such allotment for the prior 
     program year; plus
       (B) the unexpended balance of the State allotment from any 
     program year prior to the program year in which there is such 
     excess.

     SEC. 5. DEFINITIONS.

       For purposes of this Act, except as otherwise provided:
       (1) Adult.--The term ``adult'' means an individual who is 
     16 years of age, or beyond the age of compulsory school 
     attendance under State law (whichever age is higher), and who 
     is not enrolled or required to be enrolled in secondary 
     school.
       (2) Adult education.--The term ``adult education'' means 
     services or instruction below the postsecondary level for 
     adults--
       (A) who are not enrolled in secondary school;
       (B) who lack sufficient mastery of basic educational skills 
     to enable them to function effectively in society or who do 
     not have a certificate of graduation from a school providing 
     secondary education and who have not achieved an equivalent 
     level of education;
       (C) who are not currently required to be enrolled in 
     school; and
       (D) whose lack of mastery of basic skills results in an 
     inability to speak, read, or write the English language which 
     constitutes a substantial impairment of their ability to get 
     or retain employment commensurate with their real ability, 
     and thus are in need of programs to help eliminate such 
     inability and raise the level of education of such 
     individuals with a view to making them less likely to become 
     dependent on others.
       (3) Area vocational education school.--The term ``area 
     vocational education school'' means--
       (A) a specialized high school used exclusively or 
     principally for the provision of vocational education to 
     individuals who are available for study in preparation for 
     entering the labor market;
       (B) the department of a high school exclusively or 
     principally used for providing vocational education in not 
     less than 5 different occupational fields to individuals who 
     are available for study in preparation for entering the labor 
     market;
       (C) a technical institute or vocational school used 
     exclusively or principally for the provision of vocational 
     education to individuals who have completed or left high 
     school and who are available for study in preparation for 
     entering the labor market; or
       (D) the department or division of a junior college, 
     community college or university operating under the policies 
     of the State board and which provides vocational education in 
     not less than 5 different occupational fields leading to 
     immediate employment but not necessarily leading to a 
     baccalaureate degree, if, in the case of a school, 
     department, or division described in subparagraph (C) or this 
     subparagraph, it admits as regular students both individuals 
     who have completed high school and individuals who have left 
     high school.
       (4) At-risk youth.--The term ``at-risk youth'' means--
       (A) an out-of-school, at-risk youth who is an individual 
     age 24 or younger and who is not enrolled in a secondary or 
     postsecondary education program, has not received a high 
     school diploma or its equivalent and must overcome barriers 
     to employment such as lack of sufficient education or 
     vocational skills, economic disadvantages, disability, or 
     limited English proficiency; or
       (B) an in-school, at-risk youth who is an individual age 24 
     or younger who is enrolled in an accredited secondary or 
     postsecondary education program but is at risk of dropping 
     out of school or must overcome barriers to complete an 
     education program, such as economic disadvantages, 
     disability, or limited English proficiency.
       (5) Comprehensive career guidance and counseling.--The term 
     ``comprehensive career guidance and counseling'' means a 
     program--
       (A) which pertains to the body of subject matter and 
     related techniques and methods organized for the development 
     in individuals of career awareness, career planning, career 
     decisionmaking, placement skills, and knowledge and 
     understanding of local, State, and national occupational, 
     educational, and labor market needs, trends, and 
     opportunities;
       (B) which assists such individuals in making and 
     implementing informed educational and occupational choices; 
     and
       (C) which is comprehensive in nature.
       (6) Career grant.--The term ``career grant'' means a 
     voucher or a credit issued to a participant under title III 
     of this Act, or title I of the Rehabilitation Act of 1973, 
     for the purchase of education or training services from 
     certified providers of such services, in accordance with the 
     provisions of this Act, and with guidelines issued by the 
     State.
       (7) Case management.--The term ``case management'' means 
     the provision of a client-centered approach in the delivery 
     of services designed to--
       (A) empower individuals to make informed career choices;
       (B) prepare and coordinate comprehensive employment plans, 
     based upon such individual choices, such as service 
     strategies for participants, to ensure access to necessary 
     training and supportive services, using, where feasible, 
     computer-based technologies; and
       (C) provide job and career counseling during program 
     participation and after job placement.
       (8) Chief elected official.--The term ``chief elected 
     official'' means the chief elected executive officer of a 
     unit of general local government in a workforce development 
     area.
       (9) Community-based organization.--The term ``community-
     based organization'' means a private nonprofit organization 
     that is representative of a community or significant segments 
     of a community that provides or facilitates education, 
     vocational rehabilitation, job training, supportive services, 
     or internship services and programs.
       (10) Demographic characteristics.--The term ``demographic 
     characteristics'' means information on population, especially 
     with reference to size, density, distribution, and vital 
     statistics including, age, race, sex, ethnic origin, and 
     income status.
       (11) Dislocated worker.--The term ``dislocated worker'' 
     means an individual who--
       (A) has been terminated or laid off or who has received a 
     notice of termination or layoff from employment, is eligible 
     for or has exhausted entitlement to unemployment 
     compensation, and is unlikely to return to a previous 
     industry or occupation;
       (B) has been terminated, or has received a notice of 
     termination of employment, as a result of any permanent 
     closure of, or any substantial layoff at, a plant, facility, 
     or enterprise;
       (C) has been unemployed long-term and has limited 
     opportunities for employment or reemployment in the same or a 
     similar occupation in the area in which such individual 
     resides, including an older individual who may have 
     substantial barriers to employment by reason of age; or
       (D) was self-employed (including farmers and ranchers) but 
     is unemployed as a result of general economic conditions in 
     the community in which they reside or because of natural 
     disasters.
       (12) Displaced homemaker.--The term ``displaced homemaker'' 
     means an individual who--
       (A) is an adult; and
       (B)(i) has worked as an adult primarily without 
     remuneration to care for the home and family, and for that 
     reason has diminished marketable skills;
       (ii) has been dependent on public assistance or on the 
     income of a relative but is no longer supported by such 
     income; or
       (iii) is a parent whose youngest dependent child will 
     become ineligible to receive assistance under the program for 
     aid to families with dependent children under part A of title 
     IV of the Social Security Act within 2 years of the parent's 
     application for assistance under title II of this Act.
       (13) Earnings.--The term ``earnings'' means gross hourly 
     wages before any deduction, plus the estimated hourly value 
     of bonuses, tips, gratuities, commissions, and overtime pay 
     either expected or received. In 

[[Page H 9005]]
     the case of individuals in subsidized employment, total hourly earnings 
     include any wage subsidy paid to the individual.
       (14) Economic development agencies.--The term ``economic 
     development agencies'' means State and local planning and 
     zoning commissions or boards, community development agencies, 
     and other State and local agencies and institutions 
     responsible for regulating, promoting, or assisting in State 
     and local economic development.
       (15) Economically disadvantaged.--The term ``economically 
     disadvantaged'' means an individual who--
       (A) receives, or is a member of a family which receives, 
     cash welfare payments under a Federal, State, or local 
     welfare program;
       (B) has, or is a member of a family which has, received a 
     total family income for the 6-month period prior to 
     application for the program involved (exclusive of 
     unemployment compensation, child support payments, and 
     welfare payments) which, in relation to family size, was not 
     in excess of the higher of--
       (i) the official poverty line (as defined by the Office of 
     Management and Budget, and revised annually in accordance 
     with section 673(2) of the Omnibus Budget Reconciliation Act 
     of 1981 (42 U.S.C. 9902(2)), or
       (ii) 70 percent of the lower living standard income level;
       (C) is receiving (or has been determined within the 6-month 
     period prior to the application for the program involved to 
     be eligible to receive) food stamps pursuant to the Food 
     Stamp Act of 1977;
       (D) qualifies as a homeless individual under subsections 
     (a) and (c) of section 103 of the Stewart B. McKinney 
     Homeless Assistance Act;
       (E) is a foster child on behalf of whom State or local 
     government payments are made;
       (F) in cases permitted by regulations of the Secretary, is 
     an individual with a disability whose own income meets the 
     requirements of subparagraph (A) or (B), but who is a member 
     of a family whose income does not meet such requirements; or
       (G) is an individual meeting appropriate criteria approved 
     by a State.
       (16) Educational service agency.--The term ``educational 
     service agency'' means a regional public multiservice agency 
     authorized by State statute to develop, manage, and provide 
     services or programs to local educational agencies, and is 
     recognized as an administrative agency for such State's 
     vocational or technical education schools or for vocational 
     programs within its public elementary or secondary schools. 
     Such term includes any other public institution or agency 
     having administrative control and direction over a public 
     elementary or secondary school.
       (17) Employed.--The term ``employed'' means an individual 
     who is currently--
       (A) a paid employee;
       (B) works in his or her own business, profession, or farm;
       (C) works 15 hours or more per week as an unpaid worker in 
     an enterprise operated by a family member or is one who is 
     not working, but has a job or business from which he or she 
     is temporarily absent due to illness, bad weather, vacation, 
     labor-management dispute, or personal reasons; or
       (D) on active military duty.
       (18) English literacy program.--The term ``English literacy 
     program'' means a program of instruction designed to help 
     limited English proficient adults, out-of-school youths, or 
     both, achieve full competence in the English language.
       (19) Excess number.--The term ``excess number'' means, with 
     respect to the excess number of unemployed individuals within 
     a State, the number that represents the number of unemployed 
     individuals in excess of 4.5 percent of the civilian labor 
     force in the State, or the number that represents the number 
     of unemployed individuals in excess of 4.5 percent of the 
     civilian labor force in areas of substantial unemployment in 
     such State.
       (20) Family and consumer sciences.--The term ``family and 
     consumer sciences'' means instructional programs, services, 
     and activities which prepare students for personal, family, 
     community, and career roles.
       (21) Governor.--The term ``Governor'' means the chief 
     executive of a State.
       (22) Individual of limited english proficiency.--The term 
     ``individual of limited English proficiency'' means an adult 
     or out-of-school youth who has limited ability in speaking, 
     reading, writing, or understanding the English language and--
       (A) whose native language is a language other than English; 
     or
       (B) who lives in a family or community environment where a 
     language other than English is the dominant language.
       (23) Individuals with disabilities.--The term ``individuals 
     with disabilities'' has the meaning given such term in the 
     Rehabilitation Act of 1973.
       (24) Institution of higher education.--The term 
     ``institution of higher education'' has the meaning given 
     such term in section 481 of the Higher Education Act of 1965.
       (25) Job search assistance.--The term ``job search 
     assistance'' means a service that helps a job-ready 
     individual seek, locate, apply for, and obtain employment. 
     Such services may include, job-finding skills, orientation to 
     the labor market, resume preparation assistance, job finding 
     clubs, job search workshops, vocational exploration, and 
     other employability services.
       (26) Labor market area.--The term ``labor market area'' 
     means an economically integrated geographic area within which 
     individuals can reside and find employment within a 
     reasonable distance or can readily change employment without 
     changing their place of residence. Such areas shall be 
     identified in accordance with criteria used by the Bureau of 
     Labor Statistics of the Department of Labor in defining such 
     areas or similar criteria established by a Governor.
       (27) Library.--The term ``library'' includes--
       (A) a public library;
       (B) a public elementary or secondary school library;
       (C) an academic library;
       (D) a research library; and
       (E) a private library, but only if the State in which such 
     private library is located determines that the library should 
     be considered a library for purposes of this Act.
       (28) Literacy.--The term ``literacy'' means an individual's 
     ability to read, write, and speak in English, and compute and 
     solve problems, at levels of proficiency necessary--
       (A) to function on the job, in the individual's family and 
     in society;
       (B) to achieve the individual's goals; and
       (C) to develop the individual's knowledge potential.
       (29) Local educational agency.--The term ``local 
     educational agency'' has the same meaning given such term in 
     section 14101 of the Elementary and Secondary Education Act 
     of 1965.
       (30) Migrant farmworker.--The term ``migrant farmworker'' 
     means a seasonal farmworker whose farm work requires travel 
     such that the worker is unable to return to a permanent place 
     of residence within the same day.
       (31) Native american.--The term ``native American'' means 
     Indians, Alaskan natives, and Hawaiian natives.
       (32) Nontraditional employment.--The term ``nontraditional 
     employment'' as applied to women refers to occupations or 
     fields of work where women comprise less than 25 percent of 
     the individuals employed in such occupation or field of work.
       (33) On-the-job training.--The term ``on-the-job training'' 
     means training in the public or private sector that is 
     provided to a paid employee while engaged in productive work 
     that--
       (A) provides knowledge or skills essential to the full and 
     adequate performance of the job;
       (B) provides reimbursement to employers, up to 50 percent 
     of the participant's wage rate, for the extraordinary costs 
     of providing training and additional supervision; and
       (C) is based on the Occupational Employment Statistics 
     Program Dictionary.
       (34) Postsecondary educational institution.--The term 
     ``postsecondary educational institution'' means an 
     institution of higher education (as such term is defined in 
     section 481 of the Higher Education Act of 1965) which 
     continues to meet the eligibility and certification 
     requirements under title IV of such Act (20 U.S.C. 1070 et 
     seq.).
       (35) Preemployment skills training; job readiness skills 
     training.--The terms ``preemployment skills training'' and 
     ``job readiness skills training'' mean training that builds 
     on family efforts to help prepare individuals for work by 
     assuring that they are familiar with general workplace 
     expectations and exhibit work behavior and attitudes 
     necessary to compete successfully in the job market.
       (36) Public assistance.--The term ``public assistance'' 
     means Federal, State, or local government cash payments for 
     which eligibility is determined by a needs or income test.
       (37) Rapid response.--The term ``rapid response'' means 
     assistance that is directly provided by the State, or by 
     local grantees with funds provided by the State, in the case 
     of mass layoffs or plant closures, and that establishes on-
     site contact with employer and employee representatives 
     within a short period of time (preferably 48 hours or less) 
     after becoming aware of a current or projected permanent 
     closure or substantial layoff in order to--
       (A) provide information on, and facilitate access to, 
     available public programs and services for workers losing 
     jobs as a result of such layoff or closure;
       (B) provide emergency assistance adapted to the particular 
     closure or layoff;
       (C) promote the formation of labor-management committees, 
     where appropriate;
       (D) collect information related to economic dislocation and 
     available resources within the State for dislocated workers;
       (E) provide or obtain appropriate financial and technical 
     advice and liaison with economic development agencies and 
     other organizations to assist in efforts to avert worker 
     dislocation; and
       (F) assist the local community in developing its own 
     coordinated response and in obtaining access to State 
     economic development assistance.
       (38) Registered apprenticeship.--The term ``registered 
     apprenticeship'' means a program registered by the Bureau of 
     Apprenticeship and Training in the United States Department 
     of Labor, or a State Apprenticeship Agency recognized and 
     approved by the Bureau of Apprenticeship and Training as the 
     appropriate body for State registration or approval of local 
     apprenticeship programs and agreements. 

[[Page H 9006]]

       (39) School dropout.--The term ``school dropout'' means a 
     youth who is no longer attending any school and who has not 
     received a secondary school diploma or a certificate from a 
     program of equivalency for such a diploma.
       (40) Seasonal farmworker.--The term ``seasonal farmworker'' 
     means a person who during the eligibility determination 
     period (12 consecutive months out of 24 months prior to 
     application) has been primarily employed in farm work that is 
     characterized by chronic unemployment or under employment.
       (41) Skill certificate.--The term ``skill certificate'' 
     means a portable, industry-recognized credential achieved 
     through programs authorized under this Act, that certifies 
     that an individual has mastered occupational skills at levels 
     that are at least as challenging as skill standards endorsed 
     by the National Skill Standards Board, except that until such 
     skill standards are developed, the term ``skill certificate'' 
     means a credential issued under a process endorsed by the 
     State, based upon established industry standards and 
     benchmarks.
       (42) State.--The term ``State'' means any of the several 
     States, the District of Columbia, the Commonwealth of Puerto 
     Rico, the Virgin Islands, American Samoa, Guam, and the 
     Commonwealth of the Northern Mariana Islands.
       (43) State educational agency.--The term ``State 
     educational agency'' has the meaning given such term in 
     section 14101 of the Elementary and Secondary Education Act 
     of 1965.
       (44) State library administrative agency.--The term ``State 
     library administrative agency'' means the official agency of 
     a State charged by the law of the State with the extension 
     and development of public library services throughout the 
     State.
       (45) Supportive services.--The term ``supportive services'' 
     means services which are necessary to enable an individual 
     eligible for training under this Act, but who cannot afford 
     to pay for such services, to participate in a training or 
     vocational rehabilitation program or job search activities 
     funded under this Act. Such supportive services may include 
     transportation, individual and family counseling, child care 
     and dependent care, meals, temporary shelter, financial 
     counseling, needs-based payments, and other reasonable 
     expenses required for participation in a training, job 
     preparation, or job placement program. Such services may be 
     provided in-kind or through cash assistance, except that such 
     services will be provided with funds provided under this Act 
     only after alternative funding sources specifically 
     designated for such services have been exhausted.
       (46) Unemployed.--The term ``unemployed'' refers to an 
     individual who is not employed, who is available for work, 
     and who has made specific efforts to find a job within the 
     prior 4 weeks. Included as unemployed are individuals who are 
     not working, are available for work, and are waiting to be 
     called back to a job from which they have been laid off.
       (47) Unit of general local government.--The term ``unit of 
     general local government'' means any general purpose 
     political subdivision of a State which has the power to levy 
     taxes and spend funds, as well as general corporate and 
     police powers.
       (48) Veteran.--The term ``veteran'' has the meaning given 
     such term in section 101(2) of title 38, United States Code.
       (49) Work experience.--The term ``work experience'' means a 
     time-limited work activity that provides an individual with 
     the opportunity to acquire the general skills and knowledge 
     necessary to obtain employment.
       (50) Workplace mentor.--The term ``workplace mentor'' means 
     an employee or other individual, approved by the employer at 
     a workplace, who possesses the skills and knowledge to be 
     mastered by a student or program participant, and who 
     instructs, critiques the performance, and challenges the 
     student or program participant to perform well, and works in 
     consultation with classroom teachers, training providers, 
     parents, and the employer of the student or program 
     participant.
       (51) Youth.--The term ``youth'' means an individual under 
     the age of 24.

     SEC. 6. TRANSITION.

       The Secretary of Education and the Secretary of Labor shall 
     take such steps as they determine to be appropriate to 
     provide for the orderly transition from any authority under 
     provisions of statutes amended or repealed by this Act or any 
     related authority under provisions of this Act.
             TITLE I--WORKFORCE DEVELOPMENT INFRASTRUCTURE

     SEC. 101. PURPOSE OF TITLE.

       The purpose of this title is to provide for the 
     establishment of an infrastructure within States on which to 
     build a comprehensive system of workforce development and 
     literacy.
              Subtitle A--State and Local Responsibilities

     SEC. 102. STATE REQUIREMENTS.

       (a) In General.--For fiscal year 1997 and subsequent fiscal 
     years, a State that desires to receive a grant under one or 
     more of the programs specified in subsection (b) shall--
       (1) establish a collaborative process, pursuant to section 
     103;
       (2) develop a State workforce development and literacy 
     plan, pursuant to section 104; and
       (3) otherwise comply with the requirements of this Act.
       (b) Workforce Development and Literacy Programs.--
       (1) In general.--The programs referred to in subsection (a) 
     are the following:
       (A) The program under title II, the Youth Development and 
     Career Preparation Consolidation Grant.
       (B) The program under title III, the Adult Employment and 
     Training Consolidation Grant.
       (C) The program under subtitle A of title IV, the Adult 
     Education and Family Literacy Consolidation Grant.
       (D) The program amended by subtitle A of title V (relating 
     to title I of the Rehabilitation Act of 1973).
       (2) Definition.--For purposes of this Act, the term 
     ``Workforce Development and Literacy programs'' means the 
     programs specified in paragraph (1).

     SEC. 103. COLLABORATIVE PROCESS REGARDING STATE SYSTEM.

       (a) In General.--The Governor of a State that desires to 
     receive a grant under one or more of the programs specified 
     in section 102(b) shall certify to the Secretary of Education 
     and the Secretary of Labor that a collaborative process, as 
     described in subsection (b) or (c), has been used in 
     complying with the applicable provisions of this Act.
       (b) Collaborative Process.--The collaborative process 
     referred to in subsection (a) is a process for making 
     decisions which includes as participants, at a minimum, the 
     Governor and--
       (1) representatives of (which representatives are appointed 
     by the Governor)--
       (A) business and industry;
       (B) local chief elected officials (representing both cities 
     and counties);
       (C) local educational agencies (including vocational 
     educators);
       (D) postsecondary institutions (including community and 
     technical colleges);
       (E) the State rehabilitation advisory council;
       (F) organizations representing individuals served by 
     programs established under this Act (including community-
     based organizations);
       (G) employees;
       (H) Parents or organizations representing parents; and
       (I) providers of workforce development services (including 
     private-for-profit sector providers); and
       (2) the lead State agency official or officials for--
       (A) the State educational agency or agencies (including the 
     lead official or officials for vocational education, adult 
     education and literacy, and libraries);
       (B) the State agency responsible for economic development;
       (C) the State agency or agencies responsible for employment 
     security and for job training;
       (D) the State agency responsible for postsecondary 
     education;
       (E) the State agency responsible for vocational 
     rehabilitation, and where applicable, the State agency 
     providing vocational rehabilitation services for the blind;
       (F) the State agency responsible for administering welfare 
     benefits; and
       (G) the representative of the Veterans' Service assigned to 
     the State under section 4103 of title 38, United States Code.
       (c) Rule of Construction.--With respect to compliance with 
     subsection (b)--
       (1) a State may use any existing State process (including 
     any council or similar entity) that substantially meets the 
     purposes of such subsection; or
       (2) if prior to the date of enactment of this Act, a State 
     has developed a one-stop career center system or a school-to-
     work system through a collaborative process substantially 
     similar to the process described in subsection (b), the State 
     may use such process.
       (d) Authority of Governor.--
       (1) Final authority.--If, after a reasonable effort, a 
     Governor is unable to obtain agreement through the 
     collaborative process described in subsection (b) or (c), the 
     Governor shall have final authority to make decisions and to 
     submit the State plan as described under section 104.
       (2) Exception.--Nothing in this Act shall be construed to 
     negate or supersede the legal authority, under State law of 
     any State agency, State entity, or State public official over 
     programs that are under the jurisdiction of the agency, 
     entity, or official. Nothing in this Act shall be construed 
     to interfere with the authority of such agency, entity, or 
     official to enter into a contract under any provision of law.

     SEC. 104. CONSOLIDATED STATE WORKFORCE DEVELOPMENT AND 
                   LITERACY PLAN.

       (a) In General.--The Governor of a State that desires to 
     receive a grant under one or more of the programs specified 
     in section 102(b) shall submit a strategic State workforce 
     development and literacy plan that provides policy guidance 
     with respect to workforce development programs operated in 
     the State, and that meets the requirements of this section to 
     the Secretary of Education and the Secretary of Labor.
       (b) Contents.--A State workforce development and literacy 
     plan shall include the following:
       (1) A description of the collaborative process under 
     section 103 used in developing the plan.
       (2) A statement of the goals of the State workforce 
     development and literacy system, that includes-- 

[[Page H 9007]]

       (A) a description of how the State will progress toward 
     achieving the goals and purpose of this Act as established in 
     sections 3(a)(5) and 3(b);
       (B) an assessment of the needs of the State with regard to 
     current and projected demands for workers by occupation, the 
     skills and education levels of the workforce, the vocational 
     rehabilitation needs of individuals with severe disabilities 
     residing in the State, the skill and economic development 
     needs of the State, and an assessment of the type and 
     availability of youth development and career preparation, 
     workforce development, adult education, vocational 
     rehabilitation, and literacy programs and services in the 
     State; and
       (C) the identification of progress indicators, based on the 
     core indicators of performance described in section 110(f), 
     built upon a model of continuous improvement, that the State 
     will use to measure progress made by the State, local 
     workforce development boards, and other applicable local 
     entities who are recipients of financial assistance under 
     this Act in meeting such goals;
       (3) A description of how the State has complied, or will 
     comply, with the provisions of sections 105 through 108.
       (4) A description of how a State will participate in the 
     national labor market information system under title II of 
     the Wagner-Peyser Act, as added by section 132 of this Act.
       (5) Any information required to be included in the plan 
     under any of titles II through IV, and title I of the 
     Rehabilitation Act of 1973, (in the case of a State that 
     desires to receive a grant under any such title).
       (6) A description of the measures that will be taken by the 
     State to ensure coordination and consistency and avoid 
     duplication among programs receiving assistance under this 
     Act, including a description of common data collection and 
     reporting processes.
       (7) A description of the process used by the State to 
     provide an opportunity for public comment, and input into the 
     development of the plan, prior to submission of the plan.
       (8) A description of the process used by the State to 
     consult with representatives of business and industry with 
     respect to the requirements of subparagraphs (A), (B), and 
     (C) of paragraph (2) of this subsection.
       (9) Assurances that the State will provide for fiscal 
     control and fund accounting procedures that may be necessary 
     to ensure the proper disbursement of, and accounting for, 
     funds paid to the State under this Act.
       (10) A description of the sanctions which the State may 
     impose (including restrictions from future participation or 
     consideration for funding) in instances where recipients of 
     funds under this Act fail to achieve agreed upon expected 
     performance levels, fail to adhere to State mandated fiscal 
     control and funds accounting procedures, or take or fail to 
     take other actions required under the State plan, contracts, 
     or other agreements.
       (c) Disagreement.--The Governor shall accept and include 
     with the plan submitted under subsection (a) any disagreeing 
     views submitted by a participant of the collaborative process 
     if such views represent disagreement in the area in which 
     such participant was selected for representation.
       (d) Modifications to Plan.--A plan submitted by a State in 
     accordance with this section remains in effect until the 
     State submits to the Secretary such modifications as the 
     State determines necessary. This section applies to the 
     modifications to the same extent and in the same manner as 
     this section applies to the original plan.

     SEC. 105. ESTABLISHMENT OF WORKFORCE DEVELOPMENT AREAS.

       The Governor of a State that desires to receive a grant 
     under one or more of the programs specified in section 102(b) 
     shall, through the collaborative process established under 
     section 103 and after consultation with local chief elected 
     officials, and after consideration of comments received 
     through the public participation process as described in the 
     State plan, designate local workforce development areas 
     within the State taking into consideration the following:
       (1) Existing labor market areas.
       (2) Units of general local government.
       (3) Geographic areas served by local educational agencies 
     and intermediate educational agencies.
       (4) Geographic areas served by postsecondary institutions 
     and area vocational education schools.
       (5) Service delivery areas established under section 101 of 
     the Job Training Partnership Act (29 U.S.C. 1511) (as such 
     Act was in effect on the day before the date of the enactment 
     of this Act).
       (6) The distance that individuals will need to travel to 
     receive services from integrated career centers.

     SEC. 106. PROVISIONS REGARDING LOCAL WORKFORCE DEVELOPMENT 
                   BOARDS.

       (a) In General.--The Governor of a State that desires to 
     receive a grant under one or more of the programs specified 
     in section 102(b) shall ensure the establishment of a local 
     workforce development board in each local workforce 
     development area within the State.
       (b) State Criteria.--The Governor, through the 
     collaborative process described under section 103, is 
     authorized to establish criteria for use by local chief 
     elected officials in the workforce development area, in the 
     selection of members of local workforce development boards, 
     in accordance with requirements prescribed under subsections 
     (c) and (d).
       (c) Representation Requirement.--Such criteria shall 
     require, at a minimum, that a local workforce development 
     board consist of--
       (1) a majority of members who are representatives of 
     business and industry, including individuals who are owners 
     of businesses, chief executives or chief operating officers 
     of private business, and other business executives with 
     optimum policymaking authority in local businesses, selected 
     from among nominees submitted by local business organizations 
     and trade associations;
       (2) an individual or individuals with disabilities, who 
     have special knowledge or expertise in the area of vocational 
     rehabilitation;
       (3) representatives of education and training, including 
     local educational agencies, postsecondary education 
     institutions, and providers of job training and workforce 
     development services, selected from among individuals 
     nominated by regional or local educational agencies, 
     vocational education institutions, institutions of 
     postsecondary education (including community colleges), 
     providers of job training and workforce development services 
     (including private-for-profit providers), within the 
     workforce development area; and
       (4) representatives of community-based organizations, 
     employees, and veterans as nominated or recommended to the 
     board through a process established by the Governors through 
     the collaborative process.
       (d) Establishment of Board.--
       (1) Selection of board members.--
       (A) Single unit of local government in area.--In the case 
     of a workforce development area that is comprised of only one 
     unit of general local government, the chief elected official 
     of such unit is authorized to select the members of the local 
     workforce development board for such area, in accordance with 
     the State criteria developed pursuant to subsection (b).
       (B) Multiple units in area.--In the case of a workforce 
     development area that is comprised of more than one unit of 
     general local government, the chief elected officials of such 
     units are authorized to select the members of the local 
     workforce development board from the individuals so nominated 
     or recommended for such area in accordance with an agreement 
     entered into by such officials and with the State criteria 
     developed under subsection (b). In the absence of such an 
     agreement, the appointments are authorized to be made by the 
     Governor, through the collaborative process, from the 
     individuals so nominated or recommended.
       (2) Certification.--The Governor is authorized to 
     biennially certify one local workforce development board for 
     each workforce development area.
       (3) Exception.--In any case in which a local workforce 
     development area is a State, the individuals comprising the 
     Governor's collaborative process as described in section 103, 
     may be reconstituted to meet the requirements of this 
     section.
       (e) Duties of Local Workforce Development Board.--
       (1) Local workforce development plan.--Each local workforce 
     development board shall develop a biennial strategic plan and 
     provide policy guidance with respect to workforce development 
     programs operated within their respective workforce 
     development areas. Such strategic plan shall be consistent 
     with the State's collaborative workforce development and 
     literacy plan, be approved by the appropriate chief elected 
     official or officials, and be submitted to the Governor for 
     approval. If after a reasonable effort, a local workforce 
     development board is unable to obtain the approval of the 
     chief elected official or officials, the Board has the 
     authority to forward the plan, with the comments of the chief 
     elected official or officials, to the Governor for final 
     approval or disapproval. Such local plan shall include the 
     following:
       (A) Both short-term and long-term goals, and related 
     strategies, to ensure that workforce preparation and 
     development programs, including programs established pursuant 
     to this Act, title I of the Rehabilitation Act of 1973, and 
     the Wagner-Peyser Act, contribute to a coherent workforce 
     development system in the workforce development area.
       (B) A description of the performance measures to be used by 
     the local workforce development board for measuring the 
     performance of local service providers under chapter 2 of 
     title II, title III, and title I of the Rehabilitation Act of 
     1973, and the performance of integrated career center system 
     operators, with whom the Board contracts.
       (C) A description of the local integrated career center 
     system to be established in the workforce development area, 
     including--
       (i) a description of the process the local workforce 
     development board will use to designate or establish a career 
     center system which ensures that the most effective and 
     efficient service providers are chosen;
       (ii) an identification of the roles of individual workforce 
     development programs and programs authorized by the Wagner-
     Peyser Act; and
       (iii) a description of the funding sources to be used in 
     the operation of the career center system.
       (D) A description of strategies the local workforce 
     development board will undertake to fully involve local 
     employers, local educational agencies, postsecondary 
     education institutions, adult education and literacy 
     providers, local service providers, parents 

[[Page H 9008]]
     and other consumers, including individuals with disabilities, and older 
     workers in the development of the workforce development 
     system.
       (F) Such other information as requested by the State.
       (2) Identification of occupations in demand and training 
     needs.--The local workforce development board shall use 
     available labor market information and other appropriate 
     methods in order to identify and assess the needs of the 
     workforce development area.
       (3) Budget and program oversight.--
       (A) Budgeting.--
       (i) The local workforce development board, working through 
     the State administrative agent, shall develop a budget for 
     the purpose of carrying out local programs established under 
     chapter 2 of title II, title III, and title I of the 
     Rehabilitation Act of 1973, and for integrated career center 
     systems established or designated under section 107 with the 
     exception of funds made available under the Wagner-Peyser 
     Act.
       (ii) Such budget shall be subject to the approval of the 
     appropriate chief elected official or officials in the 
     workforce development area.
       (B) Program oversight.--The local workforce development 
     board, in partnership with the chief elected official or 
     officials in the workforce development area, shall conduct 
     oversight of the workforce development programs listed in 
     subparagraph (A), and of the integrated career center system 
     established under this title.
       (4) Administration.--
       (A) Fiscal agent.--
       (i) The local workforce development board may receive and 
     disburse funds made available for carrying out programs 
     authorized under chapter 2 of title II, title III, and title 
     I of the Rehabilitation Act of 1973 of this Act, or the local 
     workforce development board may designate a fiscal agent 
     (which may include the State through a mutual agreement 
     between the local board and the State), for the purpose of 
     disbursement of funds to career centers and other service 
     providers, as designated by the local workforce development 
     board.
       (ii) The Board may employ its own staff, independent of 
     local programs and service providers, and may solicit or 
     accept grants and contributions from sources other than from 
     this Act.
       (B) Limitation.--The workforce development board, or 
     employees of such board, may not operate programs established 
     under this Act. The Governor is authorized to prohibit the 
     employees of agencies providing staff support to such local 
     workforce development boards from providing workforce 
     development services to individuals served through the use of 
     funds authorized under this Act, and under title I of the 
     Rehabilitation Act of 1973.
       (C) Conflict of interest.--A member of a workforce 
     development board may not--
       (i) discuss or participate in board consideration; or
       (ii) cast a vote;

     regarding the provision of services by such member (or by an 
     organization that such member represents) or regarding any 
     matter that would provide direct financial benefit to such 
     member. The Governor may enforce more rigorous conflict of 
     interest standards, as determined appropriate.
       (D) Independent authority.--
       (i) The Board shall elect its own chairperson from among 
     the members of the board.
       (ii) The board may adopt bylaws and other operating 
     procedures as consistent with the purposes of this Act, and 
     with the policies established in the State workforce 
     development and literacy plan.
       (5) Other.--The Governor may require local workforce 
     development boards to carry out such other duties as 
     determined to be appropriate by the Governor and the 
     individuals and entities described in section 103, through 
     the collaborative process described in the State plan.

     SEC. 107. ESTABLISHMENT OF INTEGRATED CAREER CENTER SYSTEMS.

       (a) In General.--The Governor of a State that desires to 
     receive a grant under one or more of the programs specified 
     in section 102(b) shall ensure that each local workforce 
     development board establish or designate an integrated career 
     center system in the workforce development area of such 
     board, consistent with criteria established under subsection 
     (b).
       (b) State Criteria.--The Governor, through the 
     collaborative process described under section 103, is 
     authorized to establish statewide criteria for use by local 
     workforce development boards in the designation or 
     establishment of integrated career center systems to ensure 
     that the most effective and efficient service providers are 
     chosen, consistent with the requirements prescribed under 
     subsection (c).
       (c) Integrated Career Center System Requirements.--At a 
     minimum, integrated career center systems shall include--
       (1) common intake;
       (2) preliminary assessment;
       (3) integrated job search assistance;
       (4) to the extent practicable, as determined by the 
     Governor, unified and linked computer systems, including the 
     availability of labor market information as described under 
     title II of the Wagner-Peyser Act, as added by section 132 of 
     this Act, and linkages through uniform management information 
     systems; and
       (5) to the extent practicable, as determined by the 
     Governor, at least one physical, co-located site which 
     provides comprehensive and fully integrated workforce 
     development services to any individual seeking such services.

     Local workforce development areas are encouraged to establish 
     a network of comprehensive and fully-integrated co-located 
     career centers to provide the services described in 
     subsection (f), supplemented with multiple affiliated sites 
     or satellites that provide one or more of such services and 
     are linked through electronic and technological access 
     points. Such affiliated sites may include entities designated 
     as having a specialization in addressing special needs, such 
     as the needs of individuals with disabilities.
       (d) Common Access.--Information pertaining to the labor 
     market which is compiled pursuant to title II of the Wagner-
     Peyser Act, as added by section 132 of this Act, shall be 
     available, to the extent practicable, through integrated 
     electronic networks, at all integrated career centers and 
     affiliated sites.
       (e) Eligibility for Designation.--Any entity or consortium 
     of entities located in the workforce development area may be 
     designated by the local workforce development board to 
     operate an integrated career center or to participate in an 
     integrated career center system. Such entities may include 
     the following:
       (1) Institutions of higher education.
       (2) Area vocational education schools.
       (3) Local employment service offices, established under the 
     Wagner-Peyser Act.
       (4) Private nonprofit organizations, (including community-
     based organizations).
       (5) Private for-profit entities.
       (6) Agencies of local governments.
       (7) Other interested organizations and entities of 
     demonstrated effectiveness, including local chambers of 
     commerce and other business organizations, consistent with 
     State criteria established pursuant to subsection (b).
       (f) Duties.--Each integrated career center system shall, to 
     the extent practicable as determined by the Governor, carry 
     out the following duties:
       (1) Provision of core services.--An integrated career 
     center system shall make available the following information 
     and core services to individuals on a universal and 
     nondiscriminatory basis, with reasonable accommodations to 
     address the needs of individuals with disabilities, in the 
     workforce development area in which such center is located:
       (A) Outreach and intake for services provided under chapter 
     2 of title II, title III, subtitle A of title IV, and title I 
     of the Rehabilitation Act of 1973.
       (B) A preliminary assessment of the skill levels and the 
     need for services of the individual for programs under 
     chapter 2 of title II, title III, subtitle A of title IV, and 
     title I of the Rehabilitation Act of 1973 of individuals, 
     which may include such factors as basic skills, occupational 
     skills, career development skills, prior work experience, 
     employability, interests, aptitudes, vocational 
     rehabilitation needs, and supportive service needs.
       (C) Labor market information relating to local and State, 
     and if appropriate, to regional or national, occupations in 
     demand and skill requirements for such occupations, including 
     job listings for the local labor market.
       (D) Information relating to youth services, including 
     information on at-risk youth development and career 
     preparation programs authorized under title II, on vocational 
     education and school-to-work opportunities, and on youth 
     apprenticeship opportunities.
       (E) Career counseling and career planning based on a 
     preliminary assessment of the individual.
       (F) Job search assistance.
       (G) Information related to vocational rehabilitation 
     services, as provided for in title I of the Rehabilitation 
     Act of 1973.
       (H) Information relating to federally funded education and 
     job training programs (including registered apprenticeships), 
     and student aid programs, including the eligibility 
     requirements of and services provided by such programs.
       (I) Information on, and assistance in accessing referral to 
     additional services through programs providing adult 
     education and literacy services, vocational rehabilitation, 
     youth and adult workforce preparation and development, and 
     supportive services, including those programs authorized in 
     titles II through IV, title I of the Rehabilitation Act of 
     1973, available in the workforce development area.
       (J) Information on the extent to which the services 
     provided under titles II and III, subtitle A of title IV, and 
     title I of the Rehabilitation Act of 1973, meet or exceed the 
     expected levels of performance described in the State and 
     local plans, and the performance-based information provided 
     by the State to local workforce development boards on 
     certified providers of education and training, as required 
     under section 108(d)(3).
       (K) Acceptance of applications for unemployment 
     compensation.
       (L) Other appropriate activities to assist individuals into 
     employment.
       (2) Distribution of career grants.--A center or an 
     affiliated site may serve as the point of distribution of 
     career grants for education, training, and vocational 
     rehabilitation services to eligible individuals in accordance 
     with section 108. 

[[Page H 9009]]

       (3) Special arrangements.--For the purpose of providing 
     core services to individuals with severe disabilities in the 
     most effective and efficient manner possible, the integrated 
     career center system may arrange to have such core services 
     provided to an individual by a certified provider or the 
     State either on a contract basis or through the use of career 
     grants.
       (g) Additional Services.--Integrated career center systems, 
     may provide customized workforce development services to 
     employers on a fee-for-service basis, as determined by the 
     local workforce development board.
       (h) Alternative State Strategy.--Through the collaborative 
     process described in section 103, the Governor has the 
     authority to develop alternative strategies to the integrated 
     career center system, which are designed to accomplish the 
     full integration of workforce development programs. These 
     alternative strategies shall be described in a proposal to 
     the Secretaries of Education and Labor for joint review and 
     approval or disapproval not later than 60 days after the date 
     of receipt of such proposal.

     SEC. 108. IDENTIFICATION OF ELIGIBLE EDUCATION, TRAINING, AND 
                   VOCATIONAL REHABILITATION SERVICE PROVIDERS.

       (a) Eligibility Requirements.--A program offered by a 
     provider of education and training services shall be eligible 
     to receive funds under title III, and title I of the 
     Rehabilitation Act of 1973 through the receipt of career 
     grants, or through contract, if such program and provider--
       (1) is either--
       (A) eligible to participate in title IV of the Higher 
     Education Act of 1965, or
       (B) determined to be eligible under the procedures 
     described in subsection (b); and
       (2) provides the performance-based information required 
     pursuant to subsection (c), except that providers eligible 
     under subparagraph (A) only have to provide information for 
     programs other than programs leading to a degree.
       (b) Alternative Eligibility Procedure.--
       (1) In General.--The Governor shall establish an 
     alternative eligibility procedure for providers of education, 
     training, and vocational rehabilitation services (which may 
     include private sector, for profit and nonprofit providers of 
     such services) in any State desiring to receive funds under 
     title III of this Act and title I of the Rehabilitation Act 
     of 1973, but that are not eligible to participate in title IV 
     of the Higher Education Act of 1965. Such procedure shall 
     establish minimum acceptable levels of performance for such 
     providers, and be based on guidelines developed by the 
     Secretaries of Labor and Education. The Governor may utilize 
     such criteria to certify service providers as having the 
     ability to meet occupational skill standards promoted by the 
     National Skill Standards Board, or to meet, high, industry-
     recognized standards that result in a portable skill 
     certificate in the subject, occupation, or industry for which 
     training is provided, except where such standards are not 
     appropriate for the services rendered. The Governor shall 
     utilize the local workforce development boards, for the 
     identification of eligible qualified providers of education, 
     training, and vocational rehabilitation services. During a 
     transition period, not to exceed 2 years, identification of 
     eligible programs and providers under this subsection may be 
     based on the performance of such programs and providers under 
     the Job Training Partnership Act, the Rehabilitation Act of 
     1973, or other objective measures of previous performance, 
     such as employer evaluations.
       (2) Notwithstanding paragraph (1), if the participation of 
     an institution of higher education in any of the programs 
     under such title of such Act is terminated, such institution 
     shall not be eligible to receive funds under this Act for a 
     period of not less than two years.
       (c) Performance-Based Information.--The State shall 
     identify performance-based information that is to be 
     submitted by providers of services for programs to be 
     eligible under this section. Such information may include 
     information, relating to--
       (1) the percentage of students completing the programs 
     conducted by the provider;
       (2) the rates of licensure of graduates of the programs 
     conducted by the provider;
       (3) the percentage of graduates of the programs meeting 
     industry-recognized skill standards and certification 
     requirements that are at least as challenging as skill 
     standards endorsed by the National Skill Standards Board, 
     once such standards are available.
       (4) measures of program effectiveness such as the rates of 
     placement and retention in employment, and the earnings of 
     graduates of programs conducted by the provider, employer 
     evaluations of provider services, and adherence to accepted 
     industry quality standards (where available) by such 
     providers;
       (5) the percentage of students who obtained employment in 
     an occupation related to the program conducted by the 
     provider;
       (6) the warranties or guarantees provided by such provider 
     relating to the skill levels or employment to be attained by 
     students;
       (7) other information for providers of services under title 
     I of the Rehabilitation Act of 1973 that reflects the 
     priority of serving individuals with severe disabilities; and
       (8) the percentage of students who, as a result of 
     participation in the program demonstrate significant gains in 
     literacy and basic skills.
       (d) Administration.--
       (1) State agency.--The Governor is authorized to designate 
     a State agency to collect, verify, and disseminate the 
     performance-based information submitted pursuant to 
     subsection (c).
       (2) Application.--A provider of education and training 
     services that desires to be eligible to receive funds under 
     this title shall submit the information required under 
     subsection (c) to the State agency designated under paragraph 
     (1) of this subsection at such time and in such form as such 
     State agency may require.
       (3) List of eligible providers.--The State agency shall 
     compile a list of eligible programs and providers, 
     accompanied by the performance-based information submitted, 
     and disseminate such list and information to the local 
     workforce development boards and integrated career center 
     systems within the State.
       (4) Accuracy of information.--
       (A) In general.--If the State agency determines that 
     information concerning a provider is inaccurate, such 
     provider shall be disqualified from receiving funds under 
     this title for a period of not less than two years, unless 
     such provider can demonstrate to the satisfaction of the 
     Governor or his or her designee, that the information was 
     provided in good faith.
       (B) Appeal.--The Governor shall establish a procedure for a 
     service provider to appeal a determination by a State agency 
     that results in a disqualification under subparagraph (A). 
     Such procedure shall provide an opportunity for a hearing and 
     prescribe appropriate time limits to ensure prompt resolution 
     of the appeal.
       (5) Assistance in developing information.--The State agency 
     established pursuant to paragraph (1) may provide technical 
     assistance to education, training, and vocational 
     rehabilitation providers in developing the information 
     required under subsection (b). Such assistance may include 
     facilitating the utilization of State administrative records, 
     such as unemployment compensation wage records, and other 
     appropriate coordination activities.
       (e) On-The-Job Training Exception.--
       (1) In general.--Providers of on-the-job training are not 
     subject to the requirements of subsections (a), (b), (c), and 
     (d).
       (2) Collection and dissemination of information.--The 
     Workforce Development Board shall collect such performance-
     based information from on-the-job training providers as the 
     Governor may require, and disseminate such information to the 
     local integrated career center systems.
       (f) Rule of Construction Regarding State as Provider of 
     Services.--This section does not prohibit a State from being 
     a provider of education and training services under title 
     III, or under title I of the Rehabilitation Act of 1973, 
     subject to the State meeting the requirements of this section 
     for serving as such a provider.

     SEC. 109. MANAGEMENT INFORMATION SYSTEMS.

       (a) In General.--Each State is authorized to use a portion 
     of the funds it receives under this Act to design a unified 
     management information system that is in accordance with 
     guidelines established jointly by the Secretaries in 
     consultation with the Governors.
       (b) Requirements.--Each unified management information 
     system shall, to the extent practicable as determined by the 
     Governor--
       (1) be utilized for federally required fiscal reporting and 
     monitoring for each of the programs authorized under this 
     Act;
       (2) be used by all agencies involved in workforce 
     development activities, including integrated career center 
     systems which shall have the capability to track the overall 
     public investments within the State and workforce development 
     areas, and to inform policymakers as to the results being 
     achieved and the demographic characteristics of the 
     individuals served through that investment;
       (3) contain a common structure of financial reporting 
     requirements, fiscal systems and monitoring for all workforce 
     development expenditures included in the workforce 
     development system that shall utilize common data elements 
     and the definitions included in section 5;
       (4) support local efforts to establish workforce 
     development systems, including intake and eligibility 
     determination for all services; and
       (5) contain data on the demographic characteristics on the 
     participants served by programs authorized under this Act, 
     which shall be collected, produced, and published by the 
     Secretaries.
       (c) Privacy.--Nothing in this Act shall violate the 
     provisions of the Family Education Rights and Privacy Act 
     under section 444 of the General Education Provisions Act and 
     the privacy and confidentiality provisions under section 
     22(b) of title II of the Wagner Peyser Act as amended by this 
     Act.

     SEC. 110. PERFORMANCE ACCOUNTABILITY SYSTEM.

       (a) In General.--In order to promote high levels of 
     performance and to ensure an appropriate return on the 
     Nation's investment in the workforce development and literacy 
     system, each State receiving funds under this Act shall 
     develop, or have developed, a statewide performance 
     accountability system in accordance with the provisions of 
     this section.
       (b) Indicators of Performance.--
       (1) In general.--Each State receiving funds under this Act 
     shall identify indicators 

[[Page H 9010]]
     of performance for each of the programs established under titles II 
     through IV of this Act and title I of the Rehabilitation Act 
     of 1973, consistent with State goals as described in the 
     State plan in accordance with section 104. Such indicators 
     shall, at a minimum, include the core indicators described in 
     subsection (f), and be expressed in an objective, 
     quantifiable, and measurable form. Such indicators may also 
     include post-program surveys measuring customer satisfaction 
     of both employers and program participants.
       (2) Technical definitions of core indicators.--In order to 
     ensure nationwide comparability of performance data, the 
     Secretary of Labor and the Secretary of Education, in 
     collaboration with the States and with representatives of 
     business and industry, employees, educational agencies, 
     service providers, participants, parents and other interested 
     parties, shall promulgate technical definitions of each of 
     the core indicators described in subsection (f), to be used 
     under this Act in measuring performance.
       (c) Expected Levels of Performance.--
       (1) In general.--(A) Each State shall identify the level of 
     performance, consistent with State goals described under 
     section 104, that is expected for local workforce development 
     areas and other applicable local administrative entities 
     under this Act. In determining such levels, the State shall 
     take into account the challenging levels identified under 
     paragraph (2), and initially develop baseline levels of 
     performance upon which the State will measure continuous 
     improvement.
       (B) The Governor, through the collaborative process, may 
     adjust the expected level of performance with respect to each 
     local area taking into account specific economic, 
     demographic, and geographic factors, and the characteristics 
     of the population to be served.
       (2) Challenging levels of performance.--In order to 
     encourage high levels of performance and advance the Nation's 
     competitiveness in the global economy, the Secretary of Labor 
     and the Secretary of Education, in collaboration with the 
     States and with representatives of business and industry, 
     employees, educational agencies, service providers, 
     participants, parents and other interested parties, shall 
     identify challenging levels of performance with respect to 
     appropriate core indicators selected from among the core 
     indicators described in subsection (f). Where applicable, 
     such challenging levels of performance shall reflect 
     industry-recognized skill standards.
       (d) Report on Performance.--
       (1) In general.--The State shall report to the Secretary of 
     Labor and the Secretary of Education, the levels of 
     performance achieved by local workforce development areas and 
     other applicable local administrative entities with respect 
     to the indicators identified pursuant to subsection (b)(1) 
     for each program year. The Secretaries shall make such 
     information available to the general public through 
     publication and other appropriate methods, and shall 
     disseminate State-by-State comparisons, and comparisons with 
     other industrialized nations (where appropriate).
       (2) Reporting options.--In the collection and reporting of 
     such data, States are encouraged to utilize administrative 
     reporting data on quarterly earnings, establishment and 
     industry affiliation, and geographic location of employment, 
     such as unemployment insurance wage-data records.
       (e) Consequences for Poor Performance.--
       (1) Criteria.--The Governor, through the collaborative 
     process, is authorized to establish criteria for determining 
     whether local workforce development areas and other 
     applicable local administrative entities have failed to meet 
     expected levels of performance with respect to programs under 
     this Act.
       (2) Consequences for poor performance.--
       (A) State consequences.--If a State fails to meet expected 
     levels of performance for a program for any program year as 
     established pursuant to subsection (a), the Secretary of 
     Education or the Secretary of Labor, as appropriate to the 
     particular program, may provide technical assistance, 
     including assistance in the development of a performance 
     improvement plan. If such failure continues for a second 
     consecutive year, the appropriate Secretary may reduce by not 
     more than 5 percent, the amount of the grant that would (in 
     the absence of this paragraph) be payable to the State under 
     such program for the immediately succeeding program year. 
     Such penalty shall be based on the degree of failure to meet 
     expected levels of performance.
       (B) Local consequences.--(i) If a local workforce 
     development area, or other applicable local administrative 
     entity, fails to meet expected levels of performance for a 
     program for any program year under the criteria established 
     in paragraph (1), the Governor, through the collaborative 
     process, may provide technical assistance, including the 
     development of a performance improvement plan.
       (ii) If such failure continues for a second consecutive 
     year, the Governor may take corrective actions, such as the 
     withholding of funds, the redesignation of a local 
     administrative entity, or such other actions as the Governor, 
     through the collaborative process, determines are 
     appropriate, consistent with State law, section 104(c)(3) of 
     this Act, and the requirements of this Act.
       (f) Core Indicators of Performance.--
       (1) Common core indicators for adults.--In addition to the 
     core indicators of performance described in paragraph (2), 
     common core indicators of performance for programs conducted 
     under titles III and IV of this Act, and under title I of the 
     Vocational Rehabilitation Act of 1973 shall be weighted and 
     applied to each of the individual programs, according to the 
     purposes of such titles, and include measures of--
       (A) placement in unsubsidized employment;
       (B) retention in unsubsidized employment for not less than 
     6 months and for not less than 12 months, respectively;
       (C) increases in earnings, or in earnings in combination 
     with employer-assisted benefits;
       (D) attainment of industry-recognized occupational skills, 
     including basic workplace competencies and industry-
     recognized skill standards, which may include the acquisition 
     of a skill certificate in the occupation for which the 
     individual has been prepared;
       (E) attainment of a high school diploma, a general 
     equivalency diploma, or a certificate of completion of a 
     program authorized under the Rehabilitation Act of 1973; and
       (F) such other measures of performance that the State may 
     wish to collect.
       (2) Additional core indicators for adults.--
       (A) Adult employment and training programs.--In addition to 
     the common core indicators described in paragraph (1), the 
     core indicators of performance for programs conducted under 
     title III shall include measures of the success of 
     individuals with barriers to employment, including dislocated 
     workers, economically disadvantaged individuals, older 
     workers, individuals with disabilities, displaced homemakers, 
     veterans, and individuals who are basic skills deficient, in 
     achieving performance goals established pursuant to this Act.
       (B) Adult education and family literacy programs.--In 
     addition to the common core indicators described in paragraph 
     (1), the core indicators of performance for programs 
     conducted under title IV shall include measures of--
       (i) the number of individuals who, as a result of 
     participation in programs funded under this Act, demonstrate 
     significant gains in literacy skills; and
       (ii) such other measures of performance that the State may 
     wish to collect, including measures of the success of family 
     literacy programs, increased English language skills, and 
     increased community involvement.
       (C) Programs established under title i of the 
     rehabilitation act of 1973.--In addition to the common core 
     indicators described in paragraph (1), the core indicators of 
     performance for programs conducted under title I of the 
     Rehabilitation Act of 1973 shall include measures of the 
     success of individuals with severe disabilities, including 
     those individuals determined to have a disability under title 
     II or title XVI of the Social Security Act, in achieving 
     performance goals established pursuant to this Act.
       (3) Core indicators for youth development and career 
     preparation programs.--The core indicators of performance for 
     programs conducted under title II shall include measures of--
       (A) attainment of challenging State academic standards;
       (B) attainment of a high school diploma or a general 
     equivalency diploma;
       (C) attainment of industry-recognized occupational skills, 
     including basic workplace competencies and industry-
     recognized skill standards, which may include the acquisition 
     of a skill certificate in the occupation for which the 
     individual has been prepared; if such skill certificate is 
     acquired in addition to or in combination with a high shool 
     diploma or general equivalency diploma;
       (D) reduction in school dropout rates;
       (E) positive results such as placement in postsecondary 
     education or advanced training, military service, employment, 
     or registered apprenticeships;
       (F) the success of individuals described under section 
     201(12) in achieving performance goals established pursuant 
     to this Act, including placement in nontraditional training 
     and employment; and
       (G) such other measures of performance that the State may 
     wish to collect.

     SEC. 111. LIMITATION ON FEDERAL REGULATIONS.

       The Secretary of the Department of Labor and the Secretary 
     of the Department of Education shall issue regulations under 
     this Act only to the extent that such regulations are 
     necessary to ensure that there is compliance with the 
     specific requirements of this Act.

     SEC. 112. GENERAL PROVISION.

       Nothing in this Act shall mandate that any individual, 
     particularly youth served under title II of this Act, be 
     required to choose a specific career path or major.

     SEC. 113. LIABILITY.

       Expenditures that are disallowed (except in the case of 
     fraud, embezzlement, or other criminal activities) under this 
     Act or under title I of the Rehabilitation Act of 1973, may 
     be repaid from funds allocated under the title for which such 
     disallowance occurs, in subsequent program years or fiscal 
     years, as appropriate, after the year in which such 
     disallowance occured. The amount of funds repaid should be 
     equal to the amount of funds disallowed.
     
[[Page H 9011]]

              Subtitle B--Amendments to Wagner-Peyser Act

     SEC. 131. GENERAL PROGRAM REQUIREMENTS.

       (a) Definitions.--Section 2 of the Act of June 6, 1933 
     (commonly known as the ``Wagner-Peyser Act'') (29 U.S.C. 49a) 
     is amended--
       (1) in paragraph (1), by striking ``Job Training 
     Partnership Act'' and inserting ``Consolidated and Reformed 
     Education, Employment, and Rehabilitation Systems Act'';
       (2) in paragraph (2) to read as follows:
       ``(2) the term `local workforce development board' means a 
     local workforce development board established under title I 
     of the Consolidated and Reformed Education, Employment, and 
     Rehabilitation Systems Act;'';
       (3) in paragraph (4) to read as follows:
       ``(4) the term `local workforce development area' means a 
     local workforce development area established under title I of 
     the Consolidated and Reformed Education, Employment, and 
     Rehabilitation Systems Act;'';
       (4) in paragraph (5), by striking the period at the end and 
     inserting a semicolon; and
       (5) by adding at the end the following new paragraphs:
       ``(6) the term `public employment office' means an office 
     which provides employment services to the general public as 
     part of an integrated career center system; and
       ``(7) the term `integrated career center system' means an 
     integrated career center system established under title I of 
     the Consolidated and Reformed Education, Employment, and 
     Rehabilitation Systems Act.''.
       (b) Duties.--Section 3(a) of such Act (29 U.S.C. 49b(a)) is 
     amended to read as follows:
       ``(a) The Secretary of Labor shall, pursuant to title II of 
     this Act--
       ``(1) assist in the coordination and development of a 
     nationwide system of labor exchange services for the general 
     public;
       ``(2) assist in the development of performance standards, 
     benchmarks, and continuous improvement models for such 
     nationwide system which ensures private sector satisfaction 
     and meets the demands of jobseekers; and
       ``(3) ensure the continued services for individuals 
     receiving unemployment compensation.''.
       (c) Requirements for Receipt of Funds.--Section 4 of such 
     Act (29 U.S.C. 49c) is amended by striking ``a State shall, 
     through its legislature'' and inserting ``the Governor of a 
     State shall, through the collaborative process described in 
     title I of the Consolidated and Reformed Education, 
     Employment, and Rehabilitation Systems Act''.
       (d) Authorization of Appropriations.--Section 5 of such Act 
     (29 U.S.C. 49d) is amended by inserting before the period at 
     the end the following: ``, of which not less than 25 percent 
     shall be for carrying out both section 14 and title II of 
     this Act''.
       (e) Use of Funds Under This Act.--Section 7(c)(2) of such 
     Act (29 U.S.C. 49f(c)(2)) is amended by striking ``any of the 
     following provisions of law'' and all that follows and 
     inserting ``the Consolidated and Reformed Education, 
     Employment, and Rehabilitation Systems Act.''.
       (f) State Plan.--Section 8 of such Act (29 U.S.C. 49g) is 
     amended--
       (1) in subsection (a) to read as follows:
       ``(a) Any State desiring to receive assistance under this 
     Act shall submit to the Secretary, as part of the State 
     workforce development and literacy plan authorized under 
     title I of the Consolidated and Reformed Education, 
     Employment, and Rehabilitation Systems Act, detailed plans 
     for carrying out the provisions of this Act within such 
     State.'';
       (2) by striking subsections (b), (c), and (e); and
       (3) by redesignating subsection (d) as subsection (b).
       (g) Elimination of Federal Advisory Council.--Section 11 of 
     such Act (29 U.S.C. 49j) is hereby repealed.
       (h) Conforming Amendments.--
       (1) Such Act is amended by inserting after section 2 the 
     following new heading:
               ``TITLE I--GENERAL PROGRAM REQUIREMENTS''.
       (2) Section 4 of such Act is amended by striking ``United 
     States Employment Service'' and inserting ``Secretary of 
     Labor''.
       (3) Section 7(b)(2) of such Act is amended by striking 
     ``private industry council'' and inserting ``local workforce 
     development board''.
       (4) Section 7(d) of such Act is amended--
       (A) by striking ``United States Employment Service'' and 
     inserting ``Secretary of Labor''; and
       (B) by striking ``Job Training Partnership Act'' and 
     inserting ``Consolidated and Reformed Education, Employment, 
     and Rehabilitation Systems Act''.
       (5) Section 12 of such Act is amended by striking ``The 
     Director, with the approval of the Secretary of Labor,'' and 
     inserting ``The Secretary of Labor''.

     SEC. 132. LABOR MARKET INFORMATION.

       The Act of June 6, 1933 (commonly known as the ``Wagner-
     Peyser Act''; 29 U.S.C. 49), as amended by section 131, is 
     further amended by adding at the end the following new title:
                  ``TITLE II--LABOR MARKET INFORMATION

     ``SEC. 21. PURPOSE.

       ``The purpose of this title is to ensure a comprehensive 
     and coordinated system of labor market information which will 
     provide locally based, accurate, up-to-date, easily 
     accessible, and user friendly labor market information 
     through a cooperative Federal, State, and local governance 
     structure which includes partnerships with the private sector 
     at all levels.

     ``SEC. 22. SYSTEM CONTENT.

       ``(a) In General.--The Secretary of Labor, in accordance 
     with the provisions of this title, shall oversee the 
     development, maintenance, and continuous improvement of a 
     nationwide system of labor market information using 
     statistically valid data, which include--
       ``(1) statistical data from survey and projection programs 
     and data from administrative reporting systems, which, taken 
     together, enumerate, estimate, and project the supply and 
     demand for labor at Federal, State, and local levels in a 
     timely manner, including data on--
       ``(A) the demographic characteristics, as defined in 
     section 5 of the Consolidated and Reformed Education, 
     Employment, and Rehabilitation Systems Act, socioeconomic 
     characteristics, and current employment status of the 
     population, including self-employed, part-time, and seasonal 
     workers, and individuals with severe disabilities, as such 
     data are available from the Bureau of Census and other 
     sources;
       ``(B) job vacancies, education and training requirements, 
     skills, wages, benefits, working conditions, and industrial 
     distribution of occupations, as well as current and projected 
     employment opportunities and trends by industry and 
     occupation;
       ``(C) the educational attainment, training, skills, skill 
     levels, and occupations of the population aggregates, as such 
     data area are available from the Bureau of Census and other 
     sources;
       ``(D) information (such as unemployment insurance wage data 
     records) maintained in a longitudinal manner on the quarterly 
     earnings, establishment and industry affiliation, and 
     geographic location of employment; and
       ``(E) the incidence, industrial and geographical location, 
     and number of workers displaced by permanent layoffs and 
     plant closings;
       ``(2) State and local employment and consumer information 
     on--
       ``(A) job openings, locations, hiring requirements, and 
     application procedures, as well as profiles of employers in 
     the local labor market describing the nature of work 
     performed, employment requirements, wages, benefits, and 
     hiring patterns as such information is volunteered by 
     employers;
       ``(B) aggregate data on job seekers, including their 
     education and training, skills, skill levels, employment 
     experience, and employment goals; and
       ``(C) education courses, training programs, job placement 
     programs, and vocational rehabilitation programs (where 
     appropriate), including--
       ``(i) program performance information as required by this 
     Act, such as summary data on program completion, acquisition 
     of industry-recognized skill standards, job placement, 
     earnings, and the level of satisfaction of the participants 
     and their employers; and
       ``(ii) descriptive information on programs, such as 
     eligibility requirements, costs, financial support, or other 
     supportive services, and other appropriate information which 
     may be available with these courses and programs;
       ``(3) technical standards for data and information that 
     will--
       ``(A) as a minimum guarantor of data usefulness and 
     quality, ensure compatibility and additivity of data and 
     information to enable comparisons among localities and 
     States;
       ``(B) support standardization and aggregation of data and 
     information from the administrative reporting systems of 
     employment-related programs; and
       ``(C) include--
       ``(i) classification and coding systems for industries, 
     occupations, skills, programs, and courses;
       ``(ii) nationally standardized definitions of terms;
       ``(iii) a common system for designating geographic areas;
       ``(iv) quality control mechanisms for data collection and 
     analysis; and
       ``(v) common schedules for data collection and 
     dissemination;
       ``(4) analysis of data and information for uses including--
       ``(A) Federal, State, and local economic policymaking;
       ``(B) the implementation of Federal policies, including the 
     allocation of Federal funds to States and localities and the 
     facilitation of job search and hiring in local labor markets;
       ``(C) Federal, State, and local program planning and 
     evaluation; and
       ``(D) research on labor market dynamics;
       ``(5) dissemination mechanisms for data and analysis, 
     including mechanisms which may be standardized among the 
     States and technical standards in the design of automated 
     databases, and the design of user interfaces and 
     communications protocols;
       ``(6) programs of technical assistance for States and 
     localities in the development, maintenance, and utilization 
     of data, analysis, and dissemination mechanisms, including 
     assistance in adopting and utilizing automated systems and 
     improving the access, through electronic and other means, of 
     youth, adults, and employers to labor market information for 
     localities, States, and the Nation;
       ``(7) programs of research and demonstration, which may be 
     carried out by States and other public or private entities, 
     on ways to improve the products and processes authorized in 
     this title; and 

[[Page H 9012]]

       ``(8) objective performance measures, which will allow for 
     the continuous monitoring of the progress of the labor market 
     information system at national, State, and local levels.
       (b) Information to be Confidential.--
       (1) In general.--No officer or employee of the Federal 
     Government or agent of the Federal Government may:
       (A) use the information furnished under the provisions of 
     this title for any purpose other than the statistical 
     purposes for which it is supplied;
       (B) make any publication whereby the data furnished by any 
     particular establishment or individual under this title can 
     be individually identified; or
       (C) permit anyone other than the sworn officers and 
     employees of any Federal department or agency to examine the 
     individual reports.
       (2) Immunity from legal process.--Any information which is 
     collected and retained under this title shall be immune from 
     the legal process and shall not, without the consent of the 
     individual or establishment concerned, be admitted as 
     evidence or used for any purpose in any action, suit, or 
     other judicial or administrative proceeding.

     ``SEC. 23. FEDERAL RESPONSIBILITIES.

       ``(a) In General.--The Nation's labor market information 
     system shall be planned, administered, overseen, and 
     evaluated by a cooperative governance structure involving the 
     Federal Government, States, and local entities.
       ``(b) Duties.--The Secretary, with respect to data 
     collection, analysis, and dissemination of labor market 
     information, shall carry out the following duties:
       ``(1) Ensure that all statistical and administrative data 
     collection activities within the Department of Labor, 
     including the Employment and Training Administration, 
     Veterans' Employment and Training Service, Employment 
     Standards Administration, and the Occupational Health and 
     Safety Administration, are consistent with those of the 
     Bureau of Labor Statistics.
       ``(2) Assign responsibilities, as appropriate, to agencies 
     such as the Employment and Training Administration to work 
     with the Bureau of Labor Statistics in the collection, 
     analysis and, particularly, in the dissemination of labor 
     market information, and in the provision of training and 
     technical assistance to users of information, including the 
     States, employers, youth, and adults.
       ``(3) In cooperation with other Federal agencies, including 
     the Department of Commerce, Department of Defense, Department 
     of the Treasury, Department of Education, Department of 
     Health and Human Services, Department of Agriculture, 
     Department of Veterans' Affairs, and the Office of Management 
     and Budget, establish and maintain mechanisms for ensuring 
     complementarity and nonduplication in the development and 
     operation of statistical and administrative data collection 
     activities, in order to ensure a comprehensive labor market 
     information system.
       ``(4) Actively seek the participation of other Federal 
     agencies, particularly the National Center for Education 
     Statistics and the Division of Adult and Vocational 
     Education, and the Rehabilitation Services Administration of 
     the Department of Education, the Veterans' Employment and 
     Training Service of the Department of Labor and the 
     Department of Veterans' Affairs with respect to vocational 
     rehabilitation programs in the design and provision of 
     standardized information to the States to support section 
     22(2), and in the dissemination of labor market information.
       ``(5) Establish confidentiality standards for the labor 
     market information system at Federal, State, and local 
     levels, including such provisions as may be necessary, to be 
     taken in coordination with the States, to ensure that privacy 
     and confidentiality protections are guaranteed with respect 
     to individuals and firm data.
       ``(c) Additional Duties.--The Secretary, in collaboration 
     with the Bureau of Labor Statistics, with the assistance of 
     other agencies of the Department where appropriate, shall--
       ``(1) establish and maintain, with the cooperation of the 
     States, elements of the system described in sections 22(a)(1) 
     and 22(a)(3);
       ``(2) develop and promulgate standards, definitions, 
     formats, collection methodologies, and other necessary system 
     elements for the use of the States in their assembling and 
     presentation of the employment information specified in 
     section 22(a)(2);
       ``(3) eliminate gaps and duplication in statistical 
     undertakings, with the systemization of wage surveys as an 
     early priority;
       ``(4) recommend any needed improvements in administrative 
     reporting systems to support the development of labor market 
     information from their data; and
       ``(5) ensure that--
       ``(A) data are sufficiently timely relevant to employers 
     and other users, and locally detailed for uses including 
     those specified in section 22(a)(4);
       ``(B) administrative records are standardized to facilitate 
     the aggregation of data from local to State and national 
     levels and to support the creation of new statistical series 
     from program records; and
       ``(C) paperwork and reporting requirements on employers and 
     individuals are reduced.

     ``SEC. 24. ANNUAL PLAN.

       ``(a) In General.--The Secretary of Labor, in collaboration 
     with the Bureau of Labor Statistics, and with assistance of 
     other appropriate Federal agencies, shall prepare an annual 
     plan to be the operational mechanism for achieving a 
     cooperative Federal/State governance structure for labor 
     market information and provide the written justification for 
     the Department of Labor's budget request to Congress by 
     describing the activities and priorities of the Bureau of 
     Labor Statistics, other offices within the Department of 
     Labor, and other Federal agencies with regard to data 
     collection, analysis, and dissemination of labor market 
     information for fiscal years succeeding the fiscal year in 
     which the plan is developed and shall include--
       ``(1) the results of a periodic review of users' needs and 
     priorities, including the identification of new employment 
     issues and the attendant emergence of new needs, on the part 
     of Congress, the States, employers, youth, and adults, for 
     data, analysis, and dissemination;
       ``(2) an evaluation, including the results of objective 
     measures, of the performance of the labor market information 
     system in meeting these needs and the steps to be taken to 
     overcome deficiencies;
       ``(3) a summary of ongoing data programs and activities 
     under section 22 and a description of the development of new 
     data programs, analytical techniques, definitions and 
     standards, dissemination mechanisms, training and technical 
     assistance, governance mechanisms, and funding processes to 
     meet new needs; and
       ``(4) the results of an annual review of the costs to the 
     States of meeting contract requirements for data production 
     under this title, including a description of how the 
     Secretary's requested budget will cover these costs.
       ``(b) Cooperation With the States.--The Secretary and the 
     Bureau of Labor Statistics, in cooperation with the States, 
     shall develop the plan by--
       ``(1) establishing procedures and mechanisms for holding 
     formal and periodic consultations on products and 
     administration of the system, at least once each quarter, 
     with representatives of employers as well as with 
     representatives of the States from each of the 10 Federal 
     regions of the Department of Labor, elected by and from among 
     the State directors of labor market information, according to 
     a process set forth by the Secretary; and
       ``(2) incorporating in the annual plan, for its submission 
     to Congress, the results of these consultations, including 
     any supplementary or dissenting views from representatives of 
     the States.
       ``(c) Representatives of States Deemed To Be Federal 
     Employees.--For purposes of the development of the annual 
     plan and to meet the provisions of Office of Management and 
     Budget Circular A-11, the representatives of the States, 
     elected in accordance with subsection (b)(1), shall be 
     considered to be employees of the Department of Labor.

     ``SEC. 25. GOVERNOR'S RESPONSIBILITIES.

       ``(a) Designation of State Agency.--The Governor of each 
     State shall designate a single State agency to be the agency 
     responsible for the management and oversight of a statewide 
     comprehensive labor market information system and for the 
     State's participation in the cooperative Federal/State 
     governance structure for the nationwide labor market 
     information system.
       ``(b) Duties.--In order to receive Federal financial 
     assistance under this Act, the State agency shall--
       ``(1) develop, maintain, and continuously improve a 
     comprehensive labor market information system, which shall--
       ``(A) include all the elements specified in section 22; and
       ``(B) be responsive to the needs of the State and its 
     localities for planning and evaluative data, including 
     employment and economic analyses and projections, as required 
     by this Act, the Consolidated and Reformed Education, 
     Employment, and Rehabilitation Systems Act, the Social 
     Security Act, and other provisions of law which require the 
     use of labor market information;
       ``(2) ensure the performance of contract and grant 
     responsibilities for data collection, analysis, and 
     dissemination;
       ``(3) conduct such other data collection, analysis, and 
     dissemination activities as will ensure comprehensive State 
     and local labor market information;
       ``(4) actively seek the participation of other State and 
     local agencies, with particular attention to State education, 
     economic development, human services, and welfare agencies, 
     in data collection, analysis, and dissemination activities in 
     order to ensure complementarity and compatibility among data; 
     and
       ``(5) participate in the development of the national annual 
     plan.''.
                     Subtitle C--General Provision

     SEC. 141. WORKER RIGHTS.

       The following requirements shall apply to programs under 
     titles II and III of this Act:
       (1) Prohibition on displacement.--A participant in a 
     program under titles II or III shall not displace any 
     currently employed worker (including a partial displacement, 
     such as a reduction in the hours of non-overtime work, wages, 
     or employment benefits).
       (2) Prohibition on impairment of contracts.--A program 
     under title II or III shall not impair existing contracts for 
     services or collective bargaining agreements, and no such 
     program that would be inconsistent with the terms of a 
     collective bargaining agreement shall be undertaken without 
     the 

[[Page H 9013]]
     written concurrence of the labor organization and employer concerned.
       (3) Prohibition on replacement.--A participant in a program 
     under title II or III shall not be employed--
       (A) when any other individual is on temporary layoff, with 
     the clear possibility of recall, from the same or any 
     substantially equivalent job with the participating employer; 
     or
       (B) when the employer has terminated the employment of any 
     regular employee or otherwise reduced the workforce of the 
     employer with the intention of filling the vacancy so created 
     with the student.
       (4) Workplaces.--A participant in a program under title II 
     or III shall be provided with adequate and safe equipment and 
     safe and healthful workplaces in conformity with all health 
     and safety requirements of Federal, State, and local law.
       (5) Effect on other laws.--Nothing in this Act shall be 
     construed to modify or affect any Federal or State law 
     prohibiting discrimination on the basis of race, religion, 
     color, ethnicity, national origin, gender, age, or 
     disability, or to modify or affect any right to enforcement 
     of this Act that may exist under other Federal laws, except 
     as expressly provided by this Act.

     SEC. 142. TRANSFERABILITY.

       The Governor, through the collaborative process, has the 
     authority to transfer not more than 10 percent of the total 
     allotment to a State under title II or title III of this Act, 
     between such titles. Funds transferred under this authority 
     must be distributed to local providers in accordance with the 
     provisions of title II and III of this Act.
 TITLE II--YOUTH DEVELOPMENT AND CAREER PREPARATION CONSOLIDATION GRANT

     SEC. 201. PURPOSES.

       It is the purpose of this title to provide States and local 
     communities maximum flexibility in designing youth 
     development and career preparation programs that--
       (1) help youth attain the academic skills and occupational 
     skills needed to be successful in a global economy and for 
     lifelong learning;
       (2) best suit the needs of in-school and at-risk youth in 
     their communities;
       (3) promote strong connections between in-school and at-
     risk programs, to ensure that youth are prepared for further 
     education opportunities and good jobs, and promote youth 
     development and career preparation programs that provide 
     opportunities for youth to receive postsecondary education 
     and occupational training;
       (4) promote the formation of education and business 
     partnerships that are dedicated to linking the worlds of 
     school and work; and
       (5) promote high academic and occupational standards and 
     quality vocational-technical education, including improved 
     secondary and postsecondary programs, by focusing resources 
     on program improvement initiatives that help prepare youth 
     for further education, training, and high-wage jobs in high-
     performance workplaces.

     SEC. 202. DEFINITIONS.

       For purposes of this title:
       (1) The term ``administration'' means activities of a State 
     necessary for the proper and efficient performance of its 
     duties under this title, including supervision, but does not 
     include curriculum development activities, personnel 
     development, or research activities.
       (2) The term ``all aspects of the industry'' means strong 
     experience in, and understanding of, all aspects of the 
     industry that youth are preparing to enter, including 
     planning, management, finances, technical and production 
     skills, underlying principles of technology, labor issues, 
     and health and safety.
       (3) The term ``articulation agreement'' means a commitment 
     to a program designed to provide students with a 
     nonduplicative sequence of progressive coursework in 
     secondary and postsecondary education.
       (4) The term ``cooperative education'' means a method of 
     instruction of education for youth who, through written 
     cooperative arrangements between the school and employers, 
     receive instruction, including required academic courses and 
     related instruction by alternation of study in school with a 
     job in any occupational field. Such alternation shall be 
     planned and supervised by the school and employers so that 
     each contributes to the youth's education and employability. 
     Work periods and school attendance may be on alternate half 
     days, full days, weeks, or other periods of time in 
     fulfilling the cooperative program.
       (5) The term ``corrections vocational education'' means 
     programs administered by the State to assist juvenile and 
     adult criminal offenders in correctional institutions in the 
     State, including correctional institutions operated by local 
     authorities.
       (6) The term ``curricula'' means instructional and related 
     or supportive material, including materials using advanced 
     learning technology, in any occupational field which is 
     designed to strengthen the academic foundation and prepare 
     youth for employment at the entry level or to upgrade 
     occupational competencies of those previously or presently 
     employed in any occupational field, and appropriate 
     counseling and guidance material.
       (7) Except as otherwise provided, the term ``eligible 
     institution'' means a local educational agency, an area 
     vocational education school, an intermediate educational 
     agency, an institution of higher education (as such term is 
     defined in section 1201(a) of the Higher Education Act of 
     1965), a State corrections educational agency, or consortia 
     of such entities.
       (8) The term ``partnership'' means a local entity that is 
     responsible for local youth development and career 
     preparation programs and may consist of parents, employers, 
     representatives of local educational agencies and local 
     postsecondary educational institutions (including 
     representatives of area vocational education schools, where 
     applicable), local educators (such as teachers, counselors, 
     or administrators), representative employee organizations, 
     students, and may include other entities.
       (9) The term ``Secretary'' means the Secretary of 
     Education.
       (10) The term ``sequential course of study'' means an 
     integrated series of courses which are directly related to 
     the educational and occupational skill preparation of youth 
     for jobs, or preparation for postsecondary education.
       (11) The term ``single parent'' means an individual who--
       (A) is unmarried or legally separated from a spouse; and
       (B)(i) has a minor child or children for whom the parent 
     has either custody or joint custody; or
       (ii) is pregnant.
       (12) The term ``special populations'' includes individuals 
     with disabilities, economically disadvantaged individuals, 
     individuals of limited English proficiency, and individuals 
     who are eligible for nontraditional training and employment.
       (13) The term ``tech-prep education program'' means a 
     program of study which--
       (A) combines at least 2 years of secondary and 2 years of 
     postsecondary education in a nonduplicative sequential course 
     of study;
       (B) integrates academic and vocational instruction;
       (C) provides technical preparation in at least 1 field of 
     engineering technology, applied science, mechanical, 
     industrial, or practical arts or trade, or agriculture, 
     health occupations, or business;
       (D) builds student competence in mathematics, science, 
     communications, and workplace skills, through applied 
     academics and integrated instruction in a coherent sequence 
     of courses;
       (E) leads to an associate degree or certificate in a 
     specific career field;
       (F) leads to placement in appropriate employment or further 
     education; and
       (G) enables a student to fulfill a career relating to labor 
     market needs.
       (14) The term ``vocational education'' means organized 
     educational programs offering a sequence of courses which are 
     directly related to the preparation of youth in paid or 
     unpaid employment in current or emerging occupations, 
     including nonbaccalaureate certificate and degree programs 
     and baccalaureate vocational degree programs. Such programs 
     include competency-based applied learning which contributes 
     to a youth's academic knowledge, higher-order reasoning, and 
     problem-solving skills, work attitudes, general employability 
     skills, and the occupational-specific skills necessary for 
     economic independence as a productive and contributing member 
     of society. Such term also includes applied technology 
     education.
       (15) The term ``vocational student organizations'' means 
     those organizations for individuals enrolled in vocational 
     education programs which engage in activities as an integral 
     part of the instructional program. Such organizations may 
     have State and national units which aggregate the work and 
     purposes of instruction in vocational education at the local 
     level.
                       Subtitle A--State Funding

     SEC. 211. NATIONAL AND STATE FUNDING.

       (a) National Programs.--In each fiscal year, of the amounts 
     made available under section 4, the Secretary is authorized 
     to reserve 20 percent or $25,000,000, whichever is less, to 
     carry out the provisions of subtitle D.
       (b) State Allotment.--
       (1) In general.--Of the funds remaining after the 
     reservation under subsection (a), the Secretary shall allot 
     to each State for each fiscal year an amount based on that 
     State's allotment percentage.
       (2) Allotment percentage.--(A) Except as provided in 
     subparagraph (B), the allotment percentage of a State for a 
     fiscal year shall be the same percentage of funds allotted to 
     the State under this section in the preceding fiscal year.
       (B) The allotment percentage of a State for fiscal year 
     1996 shall be the percentage of funds allotted to the State 
     in fiscal year 1995 under--
       (i) section 101 or 101A of the Carl D. Perkins Vocational 
     and Applied Technology Education Act as such Act was in 
     effect on the day before the date of the enactment of this 
     Act; and
       (ii) the funding allotted in fiscal year 1995 under section 
     252 and 262 of the Job Training Partnership Act as such Act 
     was in effect on the day before the date of the enactment of 
     this Act.
       (3) State minimum.--Notwithstanding any other provision of 
     law and subject to paragraph (1), any fiscal year for which 
     the amounts appropriated for programs authorized by this 
     title exceed the amounts available under subparagraph (B) for 
     fiscal year 1995, a State shall receive not less than one-
     quarter of one percent of the amount available for each such 
     program for that fiscal 

[[Page H 9014]]
     year under this subsection. Amounts necessary for increasing such 
     payments to States to comply with the preceding sentence 
     shall be obtained by ratably reducing the amounts to be paid 
     to other States.
       (4) Definition.--For the purposes of this subsection the 
     term ``State'' means, in addition to the several States, the 
     District of Columbia, the Commonwealth of Puerto Rico, the 
     Virgin Islands, Guam, American Samoa, and the Northern 
     Mariana Islands.
       (c) Funding for State Programs.--Of the funds allotted to a 
     State under subsection (b) for each fiscal year, the 
     Governor, through the collaborative process, shall--
       (1) make available not less than 90 percent to local 
     providers;
       (2) make available not more than 8 percent for State 
     programs described in section 222; and
       (3) make available not more than 2 percent for 
     administrative purposes at the State level.
       (d) Proviso.--None of the funds made available under this 
     title shall be used to compel any youth to pursue a specific 
     career. Youth participating in programs under this title 
     shall be eligible to change their course of study and 
     training.

     SEC. 212. WITHIN STATE ALLOCATION.

       (a) In General.--
       (1) Allocation of funds.--From the amounts made available 
     pursuant to section 211(c)(1), the Governor, through the 
     collaborative process, shall--
       (A) allocate to eligible institutions an amount equal to 
     not less than 40 percent of such amount for in-school youth 
     programs described in section 241;
       (B) allocate to local workforce development boards an 
     amount equal to not less than 40 percent of such amount for 
     at-risk youth programs described in section 245.
       (2) Discretionary funds.--From the amounts made available 
     pursuant to section 211(c)(1), the Governor, through the 
     collaborative process, is authorized to provide 10 percent of 
     such amounts for discretionary purposes, as determined by the 
     Governor, to eligible institutions or local workforce 
     development boards for in-school and at-risk youth.
       (3) Remainder of funds.--From the remainder of amounts made 
     available pursuant to section 211(c)(1) and distributed 
     pursuant to paragraphs (1) and (2) of this subsection, the 
     Governor, through the collaborative process, shall allocate 
     the remainder of any such amounts to carry out the purposes 
     of subparagraphs (A) or (B) of paragraph (1).
       (b) Within State Formula.--
       (1) Establishment.--The Governor, through the collaborative 
     process, and after consultation with local chief elected 
     officials in the local workforce development area and, where 
     appropriate, local educators in such area, shall develop a 
     formula for the allocation of funds in accordance with 
     paragraph (1) of subsection (a). Such formula shall take into 
     account--
       (A) poverty rates within each local community, as 
     determined by the State;
       (B) the proportion of the State's youth population residing 
     within each local community; and
       (C) such other factors as considered appropriate.
       (2) Additional factors.--In establishing such formula, the 
     Governor shall ensure that funds are distributed equitably 
     throughout the State, and that the factors described in 
     paragraph (1) do not receive disproportionate weighting.
       (c) Minimum Grant Amounts.--
       (1) Local educational agencies.--A local educational agency 
     or consortium of such agencies that receives a subgrant from 
     a State under paragraph (1) of subsection (a) for any fiscal 
     year shall receive not less than $15,000.
       (2) Postsecondary institutions.--A postsecondary 
     institution or consortium of such institutions that receives 
     a subgrant from a State under paragraph (1) of subsection (a) 
     for any fiscal year shall receive not less than $50,000.
       (3) Local development board.--A local development board 
     that receives a subgrant from a State under paragraph (1) of 
     subsection (a) for any fiscal year shall receive not less 
     than $15,000.
       (4) Secondary-postsecondary consortia.--One or more local 
     educational agencies and one or more eligible institutions 
     may enter into a consortium agreement. A consortium formed 
     pursuant to this paragraph that receives a subgrant from a 
     State under this subtitle shall receive not less than $50,000 
     in any fiscal year.
       (d) Funds to Consortium.--Funds allocated to a consortium 
     formed to meet the requirements of subsection (c) shall be 
     used only for purposes and activities that are mutually 
     beneficial to all members of the consortium. Such funds may 
     not be reallocated to individual members of the consortium 
     for purposes or activities benefiting only one member of the 
     consortium.
       (e) Waiver.--The State may waive the application of 
     subsection (c) in any case in which a grant recipient--
       (1) is located in a rural, sparsely-populated area; and
       (2) demonstrates an inability to enter into a consortium 
     for purposes of providing services under this title.
       Subtitle B--State Organizational, Planning, and Reporting 
                            Responsibilities

     SEC. 221. STATE PLAN.

       In addition to the requirements described in title I, a 
     State that desires to receive funds for any fiscal year under 
     this title shall, as part of the State Workforce Development 
     and Literacy Plan under title I, submit to the Secretary of 
     Education information that includes--
       (1) a description of the State's plan to develop the 
     academic and occupational skills of youth and provide the 
     attainment of challenging vocational-technical education 
     standards, including industry-approved skill standards and 
     workplace competencies;
       (2) a description of how the State will improve 
     comprehensive career guidance and counseling which may 
     include linkages to career exploration and guidance 
     counseling outside of the school system and shall describe 
     how the State will effectively demonstrate the system of 
     career preparation for youth, which includes elements such as 
     professional development, and secondary-postsecondary 
     collaborations;
       (3) a description of the strategy of the State for 
     integrating academic, vocational, and work-based learning, 
     including a description of how the State will promote 
     collaboration between secondary and postsecondary 
     occupational and academic programs and institutions and 
     incorporating learning in all aspects of the industry; and
       (4) a description of how the State will promote the active 
     involvement of parents and business (including small- and 
     medium-sized businesses) in the planning, development, and 
     implementation of youth development and career preparation 
     programs authorized under this title.

     SEC. 222. STATE PROGRAMS AND STATE ACTIVITIES.

       (a) General Authority.--From amounts made available to a 
     State under section 211(c)(2), each State shall conduct State 
     programs and activities.
       (b) Uses of Funds.--The programs and activities described 
     in subsection (a) may include--
       (1) an assessment of programs conducted with assistance 
     under this title, including the development of--
       (A) performance indicators and measures for such programs; 
     and
       (B) program improvement and accountability with respect to 
     such programs;
       (2) the support for tech-prep education;
       (3) support for workforce preparation programs for single 
     parents, displaced homemakers, and single pregnant women;
       (4) support for corrections vocational education;
       (5) professional development activities for vocational 
     teachers, academic teachers, school administrators, 
     counselors, workplace mentors, and local providers regarding 
     integration of vocational, academic, and work-based 
     curricula, including--
       (A) inservice and preservice training of teachers and 
     faculty in state-of-the-art programs and techniques and 
     nontraditional training and employment; and
       (B) support of public teacher-education programs to ensure 
     vocational teachers stay current with the needs, 
     expectations, and methods of industry to meet employer 
     standards;
       (6) development, dissemination, and field testing of 
     curricula, especially--
       (A) curricula that integrate vocational, academic, and 
     work-based methodologies;
       (B) curricula that provide a coherent sequence of courses 
     through which academic and occupational skills may be 
     measured; and
       (C) curricula for work-based learning;
       (7) leadership and instructional programs in technology 
     education;
       (8) support for cooperative education;
       (9) support for family and consumer science programs;
       (10) creative use of technologies, including professional 
     development in the use of such technologies for instructional 
     purposes and to increase counselor's and youth's knowledge 
     of, and use of, additional information resources;
       (11) support for vocational student organizations; and
       (12) improving comprehensive career guidance and 
     counseling.

     SEC. 223. INCENTIVE AWARDS.

       The State, may, from the amount made available under 
     section 211(c)(2) for any fiscal year make performance awards 
     to 1 or more eligible institutions or local providers that 
     have--
       (1) exceeded in the performance goals described in section 
     110(f)(3);
       (2) implemented exemplary youth development and career 
     preparation programs at the local level in accordance with 
     the purposes described in section 201; or
       (3) provided exemplary education services and activities 
     for at-risk youth.
         Subtitle C--Subgrants for In-School and At-Risk Youth

     SEC. 231. PARTNERSHIP AGREEMENTS.

       (a) Partnership.--A local workforce development board and 
     eligible institutions that desire to receive a subgrant from 
     a State under this subtitle in any fiscal year shall form a 
     partnership for the purposes of collaborative planning, 
     coordination of in-school and at-risk programs, and effective 
     public participation.
       (b) Plan.--
       (1) In general.--The partnership referred to in subsection 
     (a) shall, in collaboration, develop and submit for approval 
     to the Governor through the State collaborative process a 
     comprehensive youth development and career preparation plan 
     for in-school and at-

[[Page H 9015]]
     risk youth. Such plan shall describe how the youth development and 
     career preparation system meets the requirements of sections 
     241 and 245 and shall address comments received through the 
     collaborative process.
       (2) Collaborative process.--The partnership shall assure 
     the involvement of parents, teachers, and the community in 
     the collaborative planning process which involves design of 
     the indicators, strategies, articulation, and cooperative 
     agreements, assessments, and evaluation of program 
     activities.
       (3) Disputes.--In the event a partnership cannot come to 
     agreement on the content of local plans, the Governor, 
     through the collaborative process, is authorized to develop 
     procedures for the resolution of issues in dispute.

     SEC. 232. DISTRIBUTION OF FUNDS.

       (a) In-School Programs.--Based upon an application 
     submitted by the partnership to the Governor through the 
     State collaborative process, a State shall distribute funds 
     made available in a fiscal year as provided in section 
     212(a)(1)(A) to eligible institutions to carry out in-school 
     youth programs described in section 241.
       (b) At-Risk Youth Programs.--A State shall distribute funds 
     made available in any fiscal year as provided in section 
     212(a)(1)(B) to local workforce development boards to carry 
     out at-risk youth programs described in section 245.

                       CHAPTER 1--IN-SCHOOL YOUTH

     SEC. 241. USES OF FUNDS FOR IN-SCHOOL YOUTH.

       (a) General Authority.--Each eligible institution that 
     receives a subgrant under this chapter shall use funds 
     provided under such grant to improve youth development and 
     career preparation programs.
       (b) Requirements for Uses of Funds.--Funds provided by a 
     State pursuant to section 212(a)(1)(A) shall be used to 
     provide in-school youth development and career preparation 
     programs that--
       (1) are of such size, scope, and quality as to be 
     effective;
       (2) integrate academic, vocational, and work-based 
     learning, stressing applied and contextual learning, through 
     a coherent sequence of courses so that youth achieve both 
     academic and occupational competencies and have strong 
     experience in, and understanding of, all aspects of the 
     industry;
       (3) involve employers in the design and implementation of 
     programs;
       (4) establish effective linkages with at-risk youth 
     programs, secondary and postsecondary education;
       (5) provide work-based learning experiences with adult 
     mentoring where appropriate; and
       (6) provide comprehensive career guidance and counseling, 
     including exploration in the practical arts or trade.
       (c) Additional Uses of Funds.--In carrying out the 
     provisions of subsection (b), funds may be used by an 
     eligible institution for in-school youth activities such as--
       (1) purchasing, leasing, or upgrading of equipment, 
     including instructional aids and material;
       (2) inservice training of vocational instructors, academic 
     instructors, employers, and workplace mentors, to integrate 
     academic and vocational education, and provide high-quality 
     school-based and work-based learning experiences;
       (3) tech-prep education programs;
       (4) supplementary services designed to meet the needs of 
     special populations;
       (5) adaptation of equipment;
       (6) apprenticeship programs;
       (7) comprehensive mentoring programs in institutions of 
     higher education offering comprehensive programs in teacher 
     preparation which seek to fully use the skills and work 
     experiences of individuals currently or formerly employed in 
     business and industry, who are interested in becoming 
     classroom instructors, and to meet the need of vocational 
     educators who wish to upgrade their teaching competencies;
       (8) local education and business partnerships for 
     developing and implementing school-based youth development 
     and career preparation systems;
       (9) support for vocational student organizations;
       (10) establishing effective activities and procedures to 
     enable program participants and their parents to participate 
     directly in decisions that influence the character of 
     programs, including providing information and assistance 
     needed for informed and effective participation; and
       (11) support for programs which prepare youth with skills 
     for personal and family life management, work, and leadership 
     in the community and the Nation.

                        CHAPTER 2--AT-RISK YOUTH

     SEC. 245. USES OF FUNDS FOR AT-RISK YOUTH.

       (a) General Authority.--Each local workforce development 
     board that receives a subgrant under this chapter shall use 
     funds provided under such grant to improve youth development 
     and career preparation programs.
       (b) Requirements for Uses of Funds.--Funds provided by a 
     State pursuant to section 212(1)(B) shall be used to provide 
     youth development and career preparation programs for at-risk 
     youth that--
       (1) are of such size, scope, and quality as to be 
     effective;
       (2) integrate academic, vocational, and work-based 
     learning, stressing applied and contextual learning, through 
     a coherent sequence of courses so that in-school and at-risk 
     youth achieve both academic and occupational competencies;
       (3) involve employers in the design and implementation of 
     programs;
       (4) establish effective linkages with in-school youth 
     programs, and secondary and postsecondary education;
       (5) provide work-based learning experiences, including 
     experiences in the practical arts or trade, if applicable;
       (6) provide adult mentoring as a core component of the 
     program;
       (7) provide an objective assessment of the academic level, 
     skill level, and service needs of each participant; and
       (8) provide comprehensive career guidance and counseling.
       (c) Additional Uses of Funds.--In carrying out the 
     provisions of subsection (b), providers of at-risk youth 
     programs, as selected by the local workforce development 
     board, may provide activities such as--
       (1) tutoring, study skills training and instruction leading 
     to completion of high school;
       (2) alternative high school services;
       (3) training or education that is combined with community 
     service, and service learning opportunities;
       (4) paid and unpaid work experience, including limited 
     internships, entry-employment experience programs, and summer 
     employment opportunities, that are integrated with year-
     round, school-based, or alternative school-based programs;
       (5) dropout prevention strategies, strategies to encourage 
     at-risk youth to reenter high school or alternative high 
     school programs, and programs that encourage pregnant and 
     parenting youth to stay in school;
       (6) preemployment and work maturity skills training;
       (7) peer-centered activities encouraging responsibility and 
     other positive social behaviors during non-school hours; and
       (8) training-related supportive services.
       (d) Limitations on Use of Funds.--Not more than 10 percent 
     of the funds provided under this chapter to a local workforce 
     development board may be used for administrative purposes.

     SEC. 246. AT-RISK YOUTH PROVIDERS.

       (a) Role of Local Workforce Development Board.--A local 
     workforce development board that receives funds under this 
     chapter shall not operate programs, but shall contract with 
     eligible providers of demonstrated effectiveness, or with 
     eligible providers utilizing service methodologies with 
     demonstrated effectiveness in serving the youth development 
     and career preparation needs of at-risk youth, for the 
     purpose of providing services under this chapter.
       (b) Eligible Providers.--For purposes of this chapter, 
     eligible providers may include--
       (1) an ``eligible institution'' as defined under section 
     202(7);
       (2) a unit of local government;
       (3) a private, nonprofit organization (including community-
     based organizations);
       (4) a private, for profit entity; or
       (5) other organizations or entities of demonstrated 
     effectiveness and approved by the local workforce development 
     board.
                     Subtitle D--National Programs

     SEC. 251. RESEARCH ACTIVITIES.

       (a) General Authority.--
       (1) In general.--In order to carry out the purpose of this 
     title, the Secretary may, directly or through grants, 
     contracts, or cooperative agreements, carry out research, 
     development, dissemination, replication of model programs, 
     demonstration programs, evaluation, capacity-building, and 
     technical assistance activities with regard to the services 
     and activities carried out under this title.
       (2) Information systems.--Activities carried out under this 
     section may include support for occupational and career 
     information systems.
       (b) Dissemination.--The Secretary shall establish a system 
     for disseminating information resulting from research and 
     development activities carried out under this title.

     SEC. 252. ASSESSMENT AND DATA COLLECTION OF YOUTH DEVELOPMENT 
                   AND CAREER PREPARATION PROGRAMS.

       (a) In General.--The Secretary, through the Office of 
     Educational Research and Improvement, shall conduct a 
     biennial assessment of services and activities assisted under 
     this title, through studies and analyses conducted 
     independently through competitive awards.
       (b) Contents.--The assessment required under subsection (a) 
     shall examine the extent to which services and activities 
     assisted under this title have achieved their intended 
     purposes and results, including the extent to which--
       (1) State and local services and activities have developed, 
     implemented, or improved youth development and career 
     preparation systems established under this title;
       (2) services and activities assisted under this title 
     succeed in preparing youth, including youth who are members 
     of special populations, for postsecondary education, further 
     learning, or entry into high-skill, high-wage careers;
       (3) youth who participate in services and activities 
     supported under this title succeed in meeting challenging 
     State academic and industry-based skill standards; and
       (4) the system improvement, participation, local and State 
     assessment, and accountability provisions of this title, 
     including the performance goals and indicators established 
     under section 110(f)(3), are effective.
     
[[Page H 9016]]


     SEC. 253. NATIONAL CENTER OR CENTERS FOR RESEARCH.

       (a) General Authority.--
       (1) National center.--The Secretary may, through a grant or 
     contract, establish one or more national centers for 
     conducting applied research, development, dissemination, and 
     technical assistance activities which would focus on 
     improving the development and career preparation of youth. 
     The Secretary shall consult with States prior to establishing 
     one or more such centers.
       (2) Eligibility.--Entities eligible to receive funds under 
     this section are institutions of higher education, other 
     public or private nonprofit organizations or agencies, and 
     consortia of such institutions, organizations, or agencies.
       (3) Previous center.--The national center in existence on 
     the day before the date of the enactment of the this Act 
     shall continue to receive assistance under this section in 
     accordance with the terms of its current award.
       (b) Activities.--
       (1) In general.--The applied research, development, 
     dissemination, and technical assistance activities carried 
     out by the national center or centers shall include--
       (A) activities that assist recipients of funds under this 
     title to meet the requirements of section 110(f)(3);
       (B) research and development of activities that combine 
     academic, vocational-technical education, and work-based 
     learning;
       (C) developing new models for remediation of basic academic 
     skills which incorporate appropriate instructional methods;
       (D) identifying ways to establish effective linkages among 
     educational and job training activities at the State and 
     local levels;
       (E) new models for comprehensive career guidance and 
     counseling;
       (F) studies providing longitudinal information or formative 
     evaluation on programs funded under this title, including an 
     analysis of the effectiveness of youth development and career 
     preparation programs in serving at-risk youth; and
       (G) such other activities as the Secretary determines to be 
     appropriate to achieve the purposes of this Act.
       (2) Duties.--The center or centers shall--
       (A) provide assistance to States and local recipients in 
     developing and using systems of performance measures and 
     indicators for improvement of youth development and career 
     preparation programs and services; and
       (B) provide technical assistance and outreach.
       (3) Summary.--The center or centers conducting the 
     activities described in paragraph (1) shall annually prepare 
     a summary of key research findings of such center or centers 
     and shall submit copies of the summary to the Secretaries of 
     Education and Labor. The Secretary shall submit that summary 
     to the Committee on Labor and Human Resources of the Senate, 
     and the Committee on Economic and Educational Opportunities 
     of the House of Representatives.
       (c) Clearinghouse.--The center or centers shall maintain a 
     clearinghouse that will provide data and information to 
     Federal, State, and local organizations and agencies about 
     the condition of youth development and career preparation 
     systems and programs funded under this title.
      TITLE III--ADULT EMPLOYMENT AND TRAINING CONSOLIDATION GRANT

     SEC. 301. PURPOSE.

       The purpose of this title is to establish an efficient, 
     high-quality, and equitable system of employment, job 
     training, and related assistance designed to facilitate the 
     transition of adults into productive, high skills, private 
     sector employment.
     Subtitle A--Adult Employment and Training Consolidation Grant

     SEC. 311. AUTHORIZATION.

       (a) In General.--In the case of each State that in 
     accordance with the requirements of section 102 submits to 
     the Secretary of Labor (hereinafter in this title referred to 
     as the ``Secretary'') a State workforce development and 
     literacy plan under section 104, the Secretary shall provide 
     a grant to the State for the purpose of providing employment, 
     job training, and related assistance for adults in the State.
       (b) Amount.--The grant shall consist of the allotment 
     determined for the State under section 312.

     SEC. 312. ALLOTMENT AMONG STATES.

       (a) In General.--Of the amount appropriated pursuant to 
     section 4(a)(2) to carry out this title for a fiscal year, 
     the Secretary shall--
       (1) allot 85 percent of such amounts in accordance with 
     subsection (b); and
       (2) reserve 15 percent for use under subtitle B.
       (b) Allotment Among States.--
       (1) Reservation for the territories.--Of the amount 
     allotted under subsection (a)(1), the Secretary shall allot 
     not more than one quarter of one percent among the 
     Commonwealth of the Northern Mariana Islands, American Samoa, 
     Guam, and the Virgin Islands.
       (2) States.--After determining the amount to be allotted 
     under paragraph (1), the Secretary shall allot the remaining 
     amount to the remaining States so that each State receives an 
     amount that bears the same proportion to such remaining 
     amount as--
       (A) the amount allotted to each such State from allotments 
     under sections 202 and 302 of the Job Training Partnership 
     Act (29 U.S.C. 1602 and 1652) (as in effect before the date 
     of the enactment of this Act) for fiscal year 1995; bears to
       (B) the aggregate of the amounts allotted to all such 
     States from allotments under such sections for such fiscal 
     year.
       (c) Minimum Allotment.--No State shall receive less than 
     one-quarter of one percent of the amount available under this 
     title for a fiscal year. Amounts necessary for increasing 
     such payments to States to comply with the preceding sentence 
     shall be obtained by ratably reducing the amounts to be paid 
     to other States.

     SEC. 313. ALLOCATION WITHIN STATES.

       (a) Reservations for State Activities.--
       (1) In general.--The Governor of the State shall reserve 
     not more than 20 percent of the amount allotted to the State 
     under section 312(b) for a fiscal year for statewide 
     activities for employment, job training, and related 
     assistance for adults.
       (2) Mandatory activities.--Such activities shall include--
       (A) rapid response activities; and
       (B) additional assistance to areas that experience 
     disasters, mass layoffs or plant closings, or other events 
     which precipitate substantial increases in the number of 
     unemployed workers, to be expended in accordance with the 
     local plan of the relevant workforce development area.
       (3) Discretionary activities.--
       (A) In general.--Such activities may include--
       (i) subject to subparagraph (B), administration by the 
     State of programs under this subtitle;
       (ii) capacity building and technical assistance to local 
     workforce development areas, integrated career center 
     systems, and service providers, including the development and 
     training of staff and the development of exemplary program 
     activities;
       (iii) incentives for program coordination, performance 
     awards, and research and demonstrations;
       (iv) implementation of innovative incumbent worker training 
     programs, which may include the establishment and 
     implementation of an employer loan program to assist in 
     skills upgrading (in accordance with the requirements of 
     section 324);
       (v) implementation of experimentation, model activities, 
     pilot projects, and demonstration projects which further the 
     goals and purposes of this Act;
       (vi) additional assistance for the development and 
     implementation of the integrated career center system of the 
     State established in accordance with title I; and
       (vii) support for a common management information system as 
     described in section 109.
       (B) Limitation.--Not more than 25 percent of the amount 
     reserved by the Governor under paragraph (1) may be used for 
     administration by the State of programs under this subtitle.
       (b) Within State Allocation.--
       (1) In general.--The Governor of the State shall allocate 
     the remainder of the amount allotted to the State under 
     section 312(b) to workforce development areas designated 
     under title I of this Act, in accordance with paragraphs (1) 
     and (2) of such section, for the purpose of providing 
     employment, job training, and related services for adults in 
     accordance with section 315.
       (2) Within state formula.--
       (A) Establishment.--The Governor, through the collaborative 
     process under section 103 of this Act, and after consultation 
     with local chief elected officials in the local workforce 
     development area, shall develop a formula for the allocation 
     of 90 percent of the remainder of funds described in 
     paragraph (1), to workforce development areas, taking into 
     account--
       (i) poverty rates within each local workforce development 
     area, as determined by the State;
       (ii) unemployment rates within each local workforce 
     development area;
       (iii) the proportion of the State's adult population 
     residing within each local workforce development area; and
       (iv) such other factors as considered appropriate.
       (B) Additional factors.--In establishing such formula, the 
     Governor shall ensure that funds are distributed equitably 
     throughout the State, and that the factors described in 
     subparagraph (A) do not receive disproportionate weighting.
       (3) Within state discretionary allocation.--In addition, 
     the Governor is authorized to allocate 10 percent of the 
     remainder of funds described in paragraph (1) to workforce 
     development areas designated under title I of this Act. 
     Amounts may be allocated to such areas as determined by the 
     Governor.

     SEC. 314. ADDITIONAL STATE PLAN REQUIREMENTS.

       The State shall, as part of the State workforce development 
     and literacy plan under title I of this Act, submit to the 
     Secretary the following additional information:
       (1) A description of how the State will serve the 
     employment and training needs of dislocated workers, 
     economically disadvantaged individuals, older workers, 
     individuals with disabilities, displaced homemakers, 
     veterans, and individuals with multiple barriers to 
     employment (as determined by the State), including 
     individuals who are basic skills deficient.
       (2) A description of how the State will provide rapid 
     response assistance to workers experiencing dislocation as a 
     result of mass layoffs and plant closings, either through the 


[[Page H 9017]]
     direct provision of services or through the transfer of funds to local 
     workforce development areas for the provision of such 
     services.

     SEC. 315. USE OF AMOUNTS.

       (a) Core Services.--Amounts allocated under section 313(b) 
     shall be used to provide core services to adults through 
     integrated career center systems in accordance with title I 
     of this Act.
       (b) Intensive Services.--
       (1) In general.--Amounts allocated under section 313(b) 
     shall be used to provide intensive services to adults--
       (A) who are unable to obtain employment through core 
     services under subsection (a); and
       (B) who have been determined to be in need of more 
     intensive services in order to gain employment.
       (2) Delivery of services.--Such intensive services shall be 
     provided--
       (A) directly through integrated career center systems in 
     accordance with title I of this Act; or
       (B) through contracts through such systems with service 
     providers approved by the local workforce development board, 
     which may include private, for-profit providers.
       (3) Types of services.--Such intensive services may include 
     the following:
       (A) Comprehensive and specialized assessments of the skill 
     levels and service needs of adults, which may include--
       (i) diagnostic testing and other assessment tools; and
       (ii) in-depth interviewing and evaluation to identify 
     employment barriers and appropriate employment goals.
       (B) Development of an individual employment plan, to 
     identify the employment goals, appropriate achievement 
     objectives, and the appropriate combination of services for 
     the adult to achieve the employment goal.
       (C) Group counseling.
       (D) Individual counseling and career planning.
       (E) Case management for adults receiving education and 
     training services under subsection (c) or supportive services 
     under subsection (d).
       (F) Follow-up counseling for adults placed in training or 
     employment, for up to 1 year.
       (c) Education and Training Services.--
       (1) In general.--Amounts allocated under section 313(b) 
     shall be used to provide education and training services to 
     adults--
       (A) who are unable to obtain employment through core 
     services under subsection (a);
       (B) who are in need of education and training services in 
     order to gain employment as a result of determinations made 
     through--
       (i) preliminary assessments under section 107(f)(1)(B) of 
     this Act; or
       (ii) comprehensive and specialized assessments under 
     subsection (b)(3)(A); and
       (C) who are unable to obtain other grant assistance for 
     such services, such as through Federal Pell Grants 
     established under title IV of the Higher Education Act of 
     1965.
       (2) Delivery of services.--Such education and training 
     services shall be provided through education and training 
     providers certified in accordance with title I of this Act.
       (3) Types of services.--Such education and training 
     services may include the following:
       (A) Basic skills training, including remedial education, 
     literacy training, and English literacy program instruction.
       (B) Occupational skills training, including training for 
     nontraditional employment.
       (C) On-the-job training.
       (D) Programs that combine workplace training with related 
     instruction.
       (E) Training programs operated by the private sector.
       (F) Skill upgrading and retraining.
       (G) Entrepreneurial training.
       (H) Employability training to enhance basic workplace 
     competencies.
       (I) Customized training conducted with a commitment by an 
     employer or group of employers to employ an individual upon 
     successful completion of the training.
       (4) Additional requirements.--
       (A) Use of career grants.--
       (i) In general.--Except as provided in clause (ii) and 
     clause (iii), education and training services under this 
     section shall be provided through the use of career grants in 
     accordance with this subsection, and shall be distributed to 
     eligible individuals through integrated career centers or 
     affiliated sites as described in section 107, and in 
     accordance with section 108 regarding the identification of 
     eligible education and training providers.
       (ii) Exceptions.--Education and training services 
     authorized under this title may be provided pursuant to a 
     contract for services in lieu of a career grant if--

       (I) such services are on-the-job training provided by an 
     employer;
       (II) the local workforce development board determines there 
     are an insufficient number of certified providers of 
     education and training services in the workforce development 
     area to accomplish the purposes of a career grant system;
       (III) the local workforce development board determines that 
     the certified providers of education and training in the 
     workforce development area are unable to provide effective 
     services to special participant populations; or
       (IV) the local workforce development board decides to enter 
     into a direct training contract with a community based 
     organization serving special participant populations.

       (iii) Transition.--States may have up to three years from 
     the date of enactment of this Act to fully implement the 
     requirements of clause (i), but nothing shall prohibit states 
     from beginning such implementation at an earlier date.
       (B) Linkage to occupations in demand.--Education and 
     training services under this subsection shall be directly 
     linked to occupations for which there is a demand in the 
     local workforce development area, or in another area to which 
     an adult receiving such services is willing to relocate.
       (d) Additional Services.--
       (1) Supportive services.--Supportive services may be 
     provided for individuals--
       (A) who are receiving assistance under any of subsections 
     (a) through (c); and
       (B) who are unable to receive such services through other 
     programs providing such services.
       (2) Needs-related payments.--
       (A) In general.--Amounts allocated under section 313(b) may 
     be used to provide needs-related payments to adults who are 
     unemployed and do not qualify for (or have ceased to qualify 
     for) unemployment compensation for the purpose of enabling 
     such adults to participate in education and training programs 
     under subsection (c).
       (B) Additional eligibility requirements.--In addition to 
     the requirements contained in subparagraph (A), a dislocated 
     worker who has exhausted unemployment insurance benefits may 
     be eligible to receive needs-related payments under this 
     paragraph only if such worker was enrolled in education or 
     training by the end of the 8th week of the worker's initial 
     unemployment compensation benefit period, or, if later, by 
     the end of the 8th week after the worker is informed that a 
     short-term layoff will in fact exceed 6 months.
       (e) Priority.--Local workforce development boards shall 
     establish a process through which priority is given to 
     dislocated workers and economically disadvantaged 
     individuals, for receipt of services provided under 
     subsections (b) and (c), in the event that funds are limited 
     within the workforce development area.
       (f) Prohibition on Private Right of Action.--Nothing in 
     this section may be construed to establish a right for a 
     participant to bring an action to obtain services under a 
     program established under this section.
       (g) Limitations on Use of Funds.--Not more than 10 percent 
     of the funds provided under this title to a local workforce 
     development board may be used for administrative purposes.
                      Subtitle B--Federal Programs

     SEC. 321. NATIONAL DISCRETIONARY GRANTS.

       (a) Grants for Dislocated Workers.--
       (1) In general.--From amounts reserved under section 
     312(a)(2) for any fiscal year, the Secretary is authorized to 
     award national discretionary grants to address major economic 
     dislocations that result from plant closures, base closures, 
     or mass layoffs.
       (2) Application.--To receive a grant under this section, an 
     eligible entity shall submit an application to the Secretary 
     at such time, in such manner, and accompanied by such 
     information as the Secretary determines is appropriate.
       (3) Eligible entities.--Grants under this section may be 
     awarded to--
       (A) the State;
       (B) a local workforce development board administering 
     assistance under this Act;
       (C) employers and employer associations;
       (D) worker-management transition assistance committees and 
     other employer-employee entities;
       (E) representatives of employees;
       (F) community development corporations and community-based 
     organizations; and
       (G) industry consortia.
       (b) Incentive Grants.--From amounts reserved under section 
     312(a)(2) for any fiscal year, the Secretary may provide 
     awards to States--
       (1) to assist in the implementation of exemplary statewide 
     workforce development system designs; and
       (2) for the achievement of exceptional performance in the 
     statewide workforce development system.

     SEC. 322. DISASTER RELIEF EMPLOYMENT ASSISTANCE.

       (a) In General.--From amounts reserved under section 
     312(a)(2) for any fiscal year, the Secretary may provide 
     assistance to the Governor of any State within which is 
     located an area that has suffered an emergency or a major 
     disaster as defined in paragraphs (1) and (2), respectively, 
     of section 102 of the Robert T. Stafford Disaster Relief and 
     Emergency Assistance Act (referred to in this section as the 
     ``disaster area'').
       (b) Use of Funds.--
       (1) Projects restricted to disaster areas.--Funds made 
     available under this section--
       (A) shall be used exclusively to provide employment on 
     projects to provide food, clothing, shelter, and other 
     humanitarian assistance for disaster victims and on projects 
     regarding demolition, cleanup, repair, renovation, and 
     reconstruction of damaged and destroyed structures, 
     facilities, and lands located within the disaster area; and
       (B) may be expended through public and private agencies and 
     organizations engaged in such projects.
       (2) Eligibility requirements.--An individual shall be 
     eligible to be offered disaster employment under this section 
     if such individual is a dislocated worker or is temporarily 
     or permanently laid off as a consequence of the disaster.
       (3) Limitations on disaster relief employment.--No 
     individual shall be employed 

[[Page H 9018]]
     under this part for more than 6 months for work related to recovery 
     from a single natural disaster.

     SEC. 323. RESEARCH, DEMONSTRATION, EVALUATION, AND CAPACITY 
                   BUILDING.

       (a) In General.--From amounts reserved under section 
     312(a)(2) for any fiscal year, the Secretary is authorized to 
     establish and carry out research, demonstration, and capacity 
     building activities in accordance with this section.
       (b) Activities.--The Secretary is authorized to carry out 
     the following activities under this section:
       (1) Research.--The Secretary is authorized to conduct 
     continuing research, which may include studies and other 
     methods and techniques, that will aid in the solution of the 
     employment and training problems of the United States. Such 
     studies may include the extent to which individuals who 
     participate in programs established under this title achieve 
     self-sufficiency as a result of such participation, including 
     the identification by State and locality, to the extent 
     practicable, of indicators measuring such self-sufficiency.
       (2) Demonstrations.--The Secretary is authorized to conduct 
     pilot and demonstration projects for the purpose of 
     developing and improving methods and techniques for 
     addressing employment and training needs which may include--
       (A) projects conducted jointly with the Department of 
     Defense to develop training programs utilizing computer-based 
     and other innovative learning technologies. The Secretary may 
     award grants and enter into contracts with appropriate 
     entities to carry out such projects; and
       (B) Projects which promote the use of distance learning, 
     enabling students to take courses through the use of 
     technology such as videos teleconferencing, computers, and 
     the internet.
       (3) Evaluation.--
       (A) Activities.--
       (i) Job training activities.--The Secretary shall provide 
     for the continuing evaluation of activities conducted under 
     this Act, including the use of controlled experiments using 
     experimental and control groups chosen by scientific random 
     assignment, and at a minimum, determine whether job training 
     and job placement programs effectively raise the hourly wage 
     rates of individuals receiving training through such 
     programs.
       (ii) Other programs.--The Secretary may conduct evaluations 
     of other federally funded employment-related activities 
     including programs administered under--

       (I) the Wagner-Peyser Act (29 U.S.C. 49 et seq.);
       (II) the National Apprenticeship Act (29 U.S.C. 50 et 
     seq.);
       (III) the Older Americans Act of 1965 (42 U.S.C. 3001 et 
     seq.); and
       (IV) the Federal unemployment insurance program under 
     titles III, IX, and XII of the Social Security Act (42 U.S.C. 
     501 et seq., 1101 et seq., and 1321 et seq.).

       (B) Effectiveness.--The Secretary shall evaluate the 
     effectiveness of programs authorized under this Act with 
     respect to--
       (i) the statutory goals;
       (ii) the performance standards established by the 
     Secretary; and
       (iii) the extent to which such programs enhance the 
     employment and earnings of participants, reduce income 
     support costs, improve the employment competencies of 
     participants in comparison to comparable persons who did not 
     participate in such programs, and to the extent feasible, 
     increase the level of total employment over the level that 
     would have existed in the absence of such programs.
       (4) National partnership and special training.--The 
     Secretary may award special grants to eligible entities to 
     carry out activities that are most appropriately administered 
     at the national level. Such activities may include--
       (A) partnerships with national organizations with special 
     expertise in developing, organizing, and administering 
     employment and training services at the national, State, and 
     local levels, such as industry and labor associations, public 
     interests groups, community-based organizations 
     representative of groups that encounter special difficulties 
     in the labor market, in education and training; and
       (B) activities that--
       (i) address industry-wide skill shortages;
       (ii) meet training needs that are best addressed on a 
     multistate basis;
       (iii) further the goals of increasing the competitiveness 
     of the United States labor force;
       (iv) require technical expertise available at the national 
     level to serve the needs of particular client groups that 
     encounter significant barriers to employment and who the 
     Secretary determines require special assistance; and
       (v) promote and experiment with model activities, pilot 
     projects, and demonstration projects which further the goals 
     and purposes of this Act.
       (5) Capacity building and technical assistance.--
       (A) In general.--The Secretary shall provide, through 
     grants, contracts, or other arrangements, staff training and 
     technical assistance to States, local workforce development 
     boards, career centers, communities, business and labor 
     organizations, service providers, industry consortia, and 
     other entities, to enhance their capacity to develop and 
     deliver effective employment and training services.
       (B) Activities.--The staff training and technical 
     assistance authorized under subparagraph (A) may include--
       (i) development of management information systems;
       (ii) development and maintenance of a national capacity 
     building, information and dissemination network; and
       (iii) grants for the replication of successful employment 
     and training models and activities.

     SEC. 324. WORKFORCE SKILLS AND DEVELOPMENT LOANS.

       (a) Authorization.--
       (1) In general.--From amounts reserved under section 
     312(a)(2) for any fiscal year, the Secretary of Labor may use 
     a portion of such amounts to provide grants to States to 
     provide loans to eligible entities described in paragraph (2) 
     to assist such entities in providing skills upgrading.
       (2) Eligible entities.--An eligible entity described in 
     this paragraph is--
       (A) an employer;
       (B) a representative of employees;
       (C) a business association;
       (D) a trade organization; or
       (E) a consortium consisting of--
       (i) more than 1 of the entities described in subparagraphs 
     (A) through (D); or
       (ii) an institution of higher education (as such term is 
     defined in section 481 of the Higher Education Act of 1965 
     (20 U.S.C. 1088) which continues to meet the eligibility and 
     certification requirements under section 498 of such Act) and 
     1 or more of the entities described in subparagraphs (A) 
     through (D).
       (b) Application.--The Secretary may provide a grant to a 
     State under subsection (a) only if such State submits to the 
     Secretary an application which contains such information as 
     the Secretary may reasonably require.
       (c) Use of Amounts.--A State shall use amounts received 
     from a grant under subsection (a) to establish a loan 
     guarantee program to assist eligible entities described in 
     paragraph (2) of such subsection to provide skills upgrading. 
     In carrying out such program, the State shall meet the 
     following requirements:
       (1) Establishment of reserve fund for loan guarantees.--The 
     State shall establish a reserve fund from amounts received 
     from such grant for the purpose of making commitments to 
     guarantee the payment of principal and interest on loans made 
     by financial institutions to such eligible entities to 
     provide skills upgrading.
       (2) Criteria for loan guarantees.--The State, in 
     conjunction with appropriate financial institutions, shall 
     establish and publish criteria for providing loan guarantees 
     to eligible entities under the program, including criteria 
     that provides for the following:
       (A) A loan guarantee may be issued under the program only 
     if, at the time such guarantee is issued the eligible entity 
     agrees to pay as an insurance premium an amount equal to 1 
     percent of the principal received by such entity under the 
     loan to the State's reserve fund.
       (B)(i) Subject to clause (ii), the eligible entity will use 
     amounts received from the loan to provide skills upgrading 
     for mid- and lower-level employees, which may include--
       (I) training in total quality management, statistical 
     process control, production techniques, office automation, 
     materials resource planning; and
       (II) training to improve basic skills, including reading, 
     writing, and arithmetic.
       (ii) In providing such skills upgrading, the eligible 
     entity shall give priority to employees who--
       (I) directly produce or deliver goods or services; or
       (II) are in danger of being terminated or laid off as a 
     result of modernization in the workplace, corporate 
     downsizing, foreign or domestic competition, or Federal 
     policies adversely affecting 1 or more industries.
       (C) Amounts from a loan shall not be used to pay the wages 
     or other benefits of any employee receiving assistance under 
     the program.
       (3) Payment by state to financial institutions in cases of 
     default.--
       (A) In general.--In accordance with criteria developed by 
     the Secretary, the State shall make payments from the State's 
     reserve fund to financial institutions that have provided 
     loans to eligible entities that have defaulted on such loans 
     for the purpose of reimbursing such institutions for the 
     amount of principal and interest remaining unpaid to the 
     institutions by reason of such default.
       (B) No full faith and credit of the united states.--Loans 
     provided by financial institutions to eligible entities under 
     loan guarantee programs under this section shall not be 
     obligations of, or guaranteed in any respect by, the United 
     States.
       (4) Interest from amounts in reserve fund.--Any interest 
     earned from amounts in the State's reserve fund shall be 
     credited to such fund.
       (d) Federal and State Share.--
       (1) Federal share.--The Federal share under this section 
     may not exceed 50 percent of the total cost of the program 
     established under subsection (c) for any fiscal year.
       (2) State share.--The State share shall be provided from 
     non-Federal sources and may be in cash or in-kind, fairly 
     evaluated.

     SEC. 325. EMPLOYMENT, TRAINING, AND EDUCATION ASSISTANCE FOR 
                   NATIVE AMERICANS.

       (a) Authorization.--From amounts reserved under section 
     4(a)(2) for any fiscal year, there shall be reserved one 
     quarter of one percent, or $85,000,000, whichever is less, to 
     provide grants to, or enter into contracts 

[[Page H 9019]]
     or cooperative agreements with, Indian tribes and tribal organizations, 
     tribally-controlled colleges, tribally-controlled 
     postsecondary vocational institutions, Indian-controlled 
     organizations serving off-reservation areas, Alaska Native 
     village and regional entities serving areas as described in 
     the Alaska Native Claims Settlement Act and Hawaiian Native-
     controlled organizations to provide employment, training, 
     vocational rehabilitation, library services, and education 
     assistance for Native Americans.
       (b) Transfer of Authority for Vocational Education 
     Activities.--In carrying out subsection (a), the Secretary of 
     Labor may enter into an agreement with the Secretary of 
     Education to carry out any portion of assistance under such 
     subsection devoted to vocational educational activities, 
     including support for the United Tribes Technical College and 
     Crownpoint Institute of Technology.
       (c) Consolidation of Funds.--Entities receiving assistance 
     under subsection (a) may consolidate such assistance with 
     assistance received from related programs in accordance with 
     the provisions of the Indian Employment, Training and Related 
     Services Demonstration Act (Public Law 102-477).
       (d) Regulations.--The Secretary shall consult with Indian, 
     Alaska Native and Hawaiian Native groups in establishing 
     regulations to carry out this section, including performance 
     standards for entities receiving assistance under subsection 
     (a), taking into account the economic circumstances of such 
     groups.

     SEC. 326. EMPLOYMENT, TRAINING, AND EDUCATION ASSISTANCE FOR 
                   MIGRANT AND SEASONAL FARMWORKERS.

       (a) Authorization.--
       (1) In general.--From amounts reserved under section 
     4(a)(2) for any fiscal year, there shall be reserved one 
     quarter of one percent, or $85,000,000, whichever is less, to 
     provide grants to, or enter into contracts or cooperative 
     agreements with, entities described in paragraph (2) to 
     provide employment, training, and education assistance for 
     migrant and seasonal farmworkers.
       (2) Entities described.--An entity described in this 
     paragraph is an entity the Secretary determines to have the 
     capacity to administer effectively a diversified workforce 
     development program for migrant and seasonal farmworkers.
       (b) Use of Amounts.--An entity shall use amounts received 
     under subsection (a) to provide employment, training, 
     educational development, high school equivalency, 
     postsecondary education assistance, vocational 
     rehabilitation, literacy, English as a second language, work-
     based education and development, worker safety training, 
     employability enhancements, emergency or other disaster 
     relief, housing, technical assistance, outreach, intake, 
     assessment, follow-up, stipend support, supportive services, 
     other needs-based assistance, self-employment and related 
     business enterprise development education, and the management 
     of a database on participating migrant and seasonal 
     farmworkers.
       (c) Regulations.--The Secretary shall consult with seasonal 
     and migrant farmworker groups in establishing regulations to 
     carry out this section, including performance standards for 
     entities receiving assistance under subsection (a)(2), taking 
     into account the economic circumstances of such groups.
 TITLE IV--ADULT EDUCATION AND FAMILY LITERACY CONSOLIDATION GRANT AND 
          LIBRARY SERVICES AND TECHNOLOGY CONSOLIDATION GRANT

     SEC. 401. FINDINGS.

       The Congress finds as follows:
       (1) According to the 1990 census, 21 percent of our 
     Nation's adults (more than 38 million persons) lack a high 
     school credential or are limited English proficient.
       (2) The National Adult Literacy Survey, conducted under the 
     Adult Education Act, found that 20 percent of all adults in 
     the United States, or about 40 million people, have minimal 
     levels of literacy skills and that the lack of such skills is 
     related to unemployment, low wages, and fewer weeks worked.
       (3) The success of State efforts to reform and improve 
     public education are dependent on the ability of the United 
     States to break intergenerational cycles of illiteracy and 
     inadequate education by ensuring that parents possess a 
     strong educational foundation and, as the first and most 
     continuous teachers of their children, model for, and instill 
     in, their children a commitment to family literacy and life-
     long learning.
       (4) Generations of immigrants have contributed to our 
     communities and our economy, but for them to continue to do 
     so given recent technologies and the competitive global 
     economy, they must master English as rapidly as possible.
       (5) Studies have found that incarcerated adults are twice 
     as likely as nonincarcerated adults to lack a good education 
     and that such lack is a significant statistical indicator of 
     recidivism.
       (6) Certain short-term and long-term goals of the Nation 
     may not be met unless the United States improves its current 
     system of adult education and life-long learning through 
     Federal leadership.

     SEC. 402. DEFINITIONS.

       As used in this title:
       (1) Correctional education agency.--The term ``correctional 
     education agency'' means an entity that provides programs for 
     criminal offenders in corrections institutions and for other 
     institutionalized individuals which include academic programs 
     for basic education, special education, bilingual or English 
     language instruction, vocational training, library 
     development, corrections education programs, guidance and 
     counseling, and other supportive services for criminal 
     offenders which may emphasize coordination of educational 
     services with educational institutions, community-based 
     organizations of demonstrative effectiveness, and the private 
     sector, designed to provide education and training.
       (2) Educationally disadvantaged adult.--The term 
     ``educationally disadvantaged adult'' means an adult who--
       (A) demonstrates basic skills equivalent to or below that 
     of students at the fifth grade level; or
       (B) has been placed in the lowest or beginning level of an 
     adult education program when that program does not use grade 
     level equivalencies as a measure of students' basic skills.
       (3) Family literacy services.--The term ``family literacy 
     services'' means services that are of sufficient intensity in 
     terms of hours, and of sufficient duration, to make 
     sustainable changes in a family and that integrate all of the 
     following activities:
       (A) Interactive literacy activities between parents and 
     their children.
       (B) Training for parents on how to be their children's 
     primary teacher and full partners in the education of their 
     children.
       (C) Parent literacy training.
       (D) An age-appropriate education program for children.
       (4) Secretary.--The term ``Secretary'' means the Secretary 
     of Education.
  Subtitle A--Adult Education and Family Literacy Consolidation Grant

     SEC. 411. PURPOSES.

       The purposes of this subtitle are to assist States to 
     provide--
       (1) to adults, the basic educational skills necessary for 
     employment and self-sufficiency;
       (2) to adults who are parents, the educational skills 
     necessary to be full partners in the educational development 
     of their children;
       (3) to adults, the basic English language skills necessary 
     to participate in the civic, social, and economic life of the 
     United States; and
       (4) to adults, the opportunity to attain a high school 
     degree or its equivalent in order to permit them to pursue 
     further education and training or improve their family and 
     work situations.

                           CHAPTER 1--FUNDING

     SEC. 421. RESERVATIONS FROM AMOUNTS APPROPRIATED.

       (a) National Institute for Literacy.--For any fiscal year, 
     the Secretary shall reserve $4,500,000 of the amount 
     appropriated under section 4(a)(3) to carry out the 
     activities of the National Institute for Literacy described 
     in section 441.
       (b) National Leadership Activities.--For any fiscal year, 
     the Secretary shall reserve $4,500,000 of the amount 
     appropriated under section 4(a)(3) to establish and carry out 
     the program of national leadership and evaluation activities 
     described in section 442.

     SEC. 422. ALLOTMENT.

       (a) Initial Allotment.--From the sums available for the 
     purpose of making grants under chapter 2 for any fiscal year, 
     the Secretary shall allot--
       (1) $100,000 each to Guam, American Samoa, the Commonwealth 
     of the Northern Mariana Islands, and the Virgin Islands; and
       (2) $250,000 to each of the other States.
       (b) Additional Allotment.--
       (1) In general.--From the remainder of the sums described 
     in subsection (a) after the application of the subsection, 
     the Secretary shall allot to each State an amount which bears 
     the same ratio to such remainder as the number of qualifying 
     adults in the State bears to the number of such adults in all 
     States.
       (2) Qualifying adult.--For purposes of this subsection, the 
     term ``qualifying adult'' means an adult who--
       (A) is at least 16 years of age, but less than 61 years of 
     age;
       (B) is beyond the age of compulsory school attendance under 
     State law;
       (C) does not have a certificate of graduation from a school 
     providing secondary education (or its equivalent); and
       (D) is not currently enrolled in elementary or secondary 
     school.

                      CHAPTER 2--GRANTS TO STATES

     SEC. 431. REQUIREMENT TO MAKE GRANTS.

       For fiscal year 1997 and subsequent fiscal years, the 
     Secretary shall make a grant to a State in an amount equal to 
     the initial and additional allotments of the State for the 
     year if the State--
       (1) has satisfied the requirements of title I and section 
     433(a)(1);
       (2) agrees not to expend the grant for any purpose other 
     than in accordance with section 432;
       (3) agrees to satisfy the grant requirements in section 
     433(a)(2) and 433(b); and
       (4) agrees not to expend the grant for the purpose of 
     supporting or providing programs, services, or activities for 
     individuals who are not adults, except if such programs, 
     services, or activities are related to family literacy 
     services.

     SEC. 432. USES OF FUNDS.

       (a) State Uses of Funds.--
       (1) Grants to serve target populations.--
       (A) In general.--Of the funds paid to a State under this 
     title for fiscal year 1998 and 

[[Page H 9020]]
     subsequent fiscal years, 3 percent shall be distributed as performance 
     grants made by the State on a competitive basis, and 
     consistent with subsection (b) and section 433(b)(2), to 
     local service providers that have provided, during the 
     immediately preceding fiscal year, adult education or family 
     literacy services to the target populations described in 
     subparagraph (C).
       (B) Local service providers.--The local service providers 
     referred to in subparagraph (A) may include the following:
       (i) Local educational agencies.
       (ii) Correctional educational agencies.
       (iii) Community-based organizations.
       (iv) Public or private nonprofit agencies.
       (v) Institutions of higher education.
       (vi) Libraries.
       (vii) Other institutions that the State determines to have 
     the ability to provide literacy services to adults and 
     families.
       (C) Target populations.--The target populations referred to 
     in subparagraph (A) are the following:
       (i) Adults with more than one barrier to self-sufficiency, 
     such as being unemployed or an educationally disadvantaged 
     adult.
       (ii) Families on public assistance (as determined by the 
     State).
       (iii) Parents who are educationally disadvantaged adults 
     and who have a child who is less than 8 years of age.
       (iv) Adults who are individuals with disabilities or who 
     have similar special needs.
       (2) Grants to local service providers.--Of the funds paid 
     to a State under this subtitle for any fiscal year that 
     remain after the application of paragraph (1), at least 85 
     percent shall be distributed as grants made by the State on a 
     competitive basis, and consistent with subsection (b) and 
     section 433(b)(2), to local service providers to establish, 
     conduct, or expand programs, services, or activities to 
     achieve a purpose of this subtitle. Such local service 
     providers may include the local service providers described 
     in paragraph (1)(B).
       (3) Other state activities.--A State may use not more than 
     12 percent of the funds paid to the State under this subtitle 
     for any fiscal year that remain after the application of 
     paragraph (1) for one or more of the following purposes:
       (A) The establishment or operation of professional 
     development programs to improve the quality of instruction 
     provided in local adult education and literacy programs, 
     including instruction provided by volunteers.
       (B) The provision of technical assistance to local service 
     providers.
       (C) The provision of technology assistance to local service 
     providers to enable them to improve the quality of their 
     programs, services, and activities that achieve a purpose of 
     this subtitle, including--
       (i) providing hardware and software;
       (ii) paying for service connection fees associated with 
     gaining access to computerized databases; and
       (iii) upgrading the technological capabilities of local 
     service providers to improve the quality of their services 
     and to assist them in providing services on a flexible 
     schedule that meets the needs of diverse populations.
       (D) The support of State or regional networks of literacy 
     resource centers that--
       (i) enhance the coordination of literacy services across 
     public and private programs and State agencies;
       (ii) enhance the capacity of the State and local service 
     providers to provide literacy services through the diffusion 
     and adoption of state-of-the-art teaching methods and 
     technologies;
       (iii) provide linkages between the National Institute for 
     Literacy established under section 441 and local service 
     providers for the sharing of literacy information, research, 
     and resources;
       (iv) encourage government and industry partnerships; and
       (v) provide training and technical assistance to literacy 
     instructors in reading instruction, the use of state-of-the-
     art methodologies, instructional materials, and technologies, 
     and professional development.
       (E) Monitoring and evaluating the quality of, and the 
     improvement in, services and activities conducted with 
     Federal financial assistance under this subtitle, including 
     carrying out section 433(a)(2).
       (F) The support of a common management information system 
     as described in section 109.
       (G) Carrying out other activities of statewide significance 
     that promote the purposes of this Act.
       (4) Administrative expenses.--For any fiscal year, a State 
     may use not more than 3 percent of the funds paid to the 
     State under this subtitle that remain after the application 
     of paragraph (1) or $50,000, whichever is greater, for--
       (A) planning, administration, and interagency coordination 
     associated with a grant under this subtitle; and
       (B) support for integrated career center systems described 
     in section 107.
       (b) Local Uses of Funds.--A State shall require that a 
     local service provider that receives a grant from the State 
     under paragraph (1) or (2) of subsection (a) use the grant to 
     establish or operate one or more programs that provide 
     instruction or services within one or more of the following 
     categories:
       (1) Adult basic education that is designed for an adult 
     who--
       (A) has minimal competence in reading, writing, or 
     computation;
       (B) is not sufficiently competent in reading, writing, or 
     computation to meet the requirements of adult life in the 
     United States; or
       (C) is not sufficiently competent in speaking, reading, or 
     writing the English language to obtain employment 
     commensurate with the adult's intellectual abilities.
       (2) Adult secondary education that is designed for an adult 
     who is literate and can function in everyday life, but who--
       (A) has not acquired basic educational skills, including 
     reading, writing, and computation; or
       (B) does not have a certificate of graduation from a school 
     providing education to students in grade 12, or its 
     equivalent.
       (3) English literacy instruction that is designed for an 
     adult--
       (A) who--
       (i) has limited ability in speaking, reading, writing, or 
     understanding the English language and whose native language 
     is a language other than English; or
       (ii) lives in a family or community environment where a 
     language other than English is the dominant language; and
       (B) who, by reason of a condition described in subparagraph 
     (A), has sufficient difficulty reading, writing, or 
     understanding the English language that the adult is unable--
       (i) to learn successfully in a classroom where the language 
     of instruction is English; or
       (ii) to participate fully in the society of the United 
     States.
       (4) Family literacy services.
       (c) Authorization to Receive Payments From Other 
     Programs.--A local service provider that receives a grant 
     from a State under paragraph (1) or (2) of subsection (a), 
     and that provides adult education and literacy services to an 
     adult who was referred to the provider by a program supported 
     under title II or III, may receive payment for the services 
     from the program, either in the form of a career grant or by 
     some other means.

     SEC. 433. ADDITIONAL GRANT REQUIREMENTS.

       (a) Goals, Progress Indicators, Performance Measures.--
       (1) Planning requirements.--A State that desires to receive 
     a grant under this subtitle shall accomplish the following:
       (A) Establish, through the collaborative process described 
     in section 103, measurable goals for improving literacy 
     levels, retention in literacy programs, and long-term 
     learning gains of individuals in the State.
       (B) Based on such goals and the performance measures 
     described in section 110(f), establish, through such 
     collaborative process, progress indicators to be used to 
     evaluate the performance of local service providers receiving 
     a grant under paragraph (1) or (2) of section 432(a).
       (C) Describe such goals and progress indicators in the 
     State workforce development and literacy plan submitted to 
     the Secretary under section 104.
       (2) Implementation requirements.--A State that receives a 
     grant under this subtitle shall accomplish the following:
       (A) With respect to each local service provider receiving a 
     grant under paragraph (1) or (2) of section 432(a), based on 
     the goals and progress indicators established under paragraph 
     (1), measure the performance measures described in section 
     110(f) and use the data produced by such measurement to 
     improve the quality of services provided to program 
     participants or service recipients.
       (B) Beginning on the date that is 2 years after the first 
     date that a local service provider receives a grant under 
     paragraph (1) or (2) of section 432(a), annually assess the 
     degree to which the provider is meeting or exceeding the 
     progress indicators applicable to the provider.
       (C) Annually report to the Secretary on the performance 
     measures described in section 434 for each category described 
     in such section.
       (b) Other Requirements.--A State that receives a grant 
     under this subtitle shall ensure the following:
       (1) Expenditures of non-federal funds.--For any fiscal year 
     for which a grant is made to the State under this subtitle, 
     the State shall expend, on programs and activities relating 
     to adult education and family literacy services, an amount, 
     derived from sources other than the Federal Government, equal 
     to 25 percent of the State's initial and additional 
     allotments for the year.
       (2) Priority for planning with boards and systems.--In 
     awarding grants to local service providers under paragraph 
     (1) or (2) of section 432(a), the State shall give priority 
     to providers that demonstrate joint planning with local 
     workforce development boards and integrated career center 
     systems.
       (3) Equitable access.--Local educational agencies, public 
     or private nonprofit agencies, community-based organizations, 
     correctional education agencies, institutions of higher 
     education, libraries, and institutions which serve 
     educationally disadvantaged adults shall be provided direct 
     and equitable access to Federal funds provided under this 
     subtitle in accordance with this subtitle.
       (4) Payments by local workforce development boards to local 
     service providers.--A local service provider that receives a 
     grant from a State under paragraph (1) or (2) of section 
     432(a) may negotiate with a local workforce development board 
     with respect to receipt of payments for adult education and 
     literacy services provided by the provider to adults referred 
     to the provider by a program supported under title II or III.
     
[[Page H 9021]]


                      CHAPTER 3--NATIONAL PROGRAMS

     SEC. 441. NATIONAL INSTITUTE FOR LITERACY.

       (a) Establishment.--
       (1) In general.--There shall be established a National 
     Institute for Literacy (in this section referred to as the 
     ``Institute''). The Institute shall be administered under the 
     terms of an interagency agreement entered into by the 
     Secretary of Education with the Secretary of Labor and the 
     Secretary of Health and Human Services (in this section 
     referred to as the ``Interagency Group''). The Secretary may 
     include in the Institute any research and development center, 
     institute, or clearinghouse established within the Department 
     of Education whose purpose is determined by the Secretary to 
     be related to the purpose of the Institute.
       (2) Board recommendations.--The Interagency Group shall 
     consider the recommendations of the National Institute for 
     Literacy Advisory Board (in this section referred to as the 
     ``Board'') established under subsection (d) in planning the 
     goals of the Institute and in the implementation of any 
     programs to achieve such goals.
       (3) Daily operations.--The daily operations of the 
     Institute shall be carried out by the Director of the 
     Institute appointed under subsection (g).
       (b) Duties.--
       (1) In general.--The Institute shall--
       (A) provide national leadership for the improvement and 
     expansion of the system for delivery of literacy services;
       (B) coordinate the delivery of such services;
       (C) support the creation of new methods of offering 
     improved services;
       (D) serve as a national resource for adult education and 
     family literacy services by providing to the public the best 
     and most current information available on the subjects; and
       (E) assist States in developing levels of performance.
       (2) Authorized activities.--In order to carry out the 
     duties described in paragraph (1), the Institute may--
       (A) establish a national electronic database of information 
     that includes--
       (i) information on--

       (I) effective practices in the provision of literacy and 
     basic skills instruction;
       (II) public and private literacy and basic skills programs 
     and Federal, State, and local policies affecting the 
     provision of literacy services at the national, State, and 
     local levels; and
       (III) technical assistance, meetings, conferences, and 
     other opportunities that lead to the improvement of literacy 
     and basic skills services; and

       (ii) a communication network for literacy programs, 
     providers, and students;
       (B) coordinate support for the provision of literacy and 
     basic skills services across Federal agencies and at the 
     State and local level;
       (C) coordinate the support of research and development on 
     literacy and basic skills in families and adults across 
     Federal agencies and carry out basic and applied research and 
     development on topics that are not being investigated by 
     other organizations or agencies;
       (D) collect and disseminate information on methods of 
     advancing literacy that show promise of success; and
       (E) assist in the development of policy with respect to 
     literacy and basic skills.
       (3) Grants, contracts, and agreements.--The Institute may 
     enter into contracts or cooperative agreements with, or make 
     grants to, individuals, public or private institutions, 
     agencies, organizations, or consortia of such institutions, 
     agencies, or organizations to carry out the activities of the 
     Institute. Such grants, contracts, or agreements shall be 
     subject to the laws and regulations that generally apply to 
     grants, contracts, or agreements entered into by Federal 
     agencies.
       (c) Literacy Leadership.--
       (1) Fellowships.--The Institute, in consultation with the 
     Board, may award fellowships, with such stipends and 
     allowances as the Director considers necessary, to 
     outstanding individuals pursuing careers in adult education 
     or literacy in the areas of instruction, management, 
     research, or innovation.
       (2) Use of fellowships.--Fellowships awarded under this 
     subsection shall be used, under the auspices of the 
     Institute, to engage in research, education, training, 
     technical assistance, or other activities to advance the 
     field of adult education or literacy, including the training 
     of volunteer literacy providers at the national, State, or 
     local level.
       (3) Interns and volunteers.--The Institute, in consultation 
     with the Board, may award paid and unpaid internships to 
     individuals seeking to assist the Institute in carrying out 
     its mission. Notwithstanding section 1342 of title 31, United 
     States Code, the Institute may accept and use voluntary and 
     uncompensated services as the Institute determines necessary.
       (d) National Institute for Literacy Advisory Board.--
       (1) Establishment.--
       (A) In general.--There shall be a National Institute for 
     Literacy Advisory Board. The Board shall consist of 10 
     individuals appointed by the President with the advice and 
     consent of the Senate from individuals who--
       (i) are not otherwise officers or employees of the Federal 
     Government; and
       (ii) are representative of entities or groups described in 
     subparagraph (B).
       (B) Entities or groups described.--The entities or groups 
     referred to in subparagraph (A) are--
       (i) literacy organizations and providers of literacy 
     services, including--

       (I) nonprofit providers of literacy services;
       (II) providers of programs and services involving English 
     language instruction; and
       (III) providers of services receiving assistance under this 
     subtitle;

       (ii) businesses that have demonstrated interest in literacy 
     programs;
       (iii) literacy students;
       (iv) experts in the area of literacy research;
       (v) State and local governments; and
       (vi) representatives of employees.
       (2) Duties.--The Board shall--
       (A) make recommendations concerning the appointment of the 
     Director and staff of the Institute;
       (B) provide independent advice on the operation of the 
     Institute; and
       (C) receive reports from the Interagency Group and the 
     Director.
       (3) Terms.--
       (A) In general.--Each member of the Board shall be 
     appointed for a term of 3 years, except that the initial 
     terms for members may be 1, 2, or 3 years in order to 
     establish a rotation in which \1/3\ of the members are 
     selected each year.
       (B) Vacancy appointments.--Any member appointed to fill a 
     vacancy occurring before the expiration of the term for which 
     the member's predecessor was appointed shall be appointed 
     only for the remainder of that term. A member may serve after 
     the expiration of that members' term until a successor has 
     taken office. A vacancy in the Board shall be filled in the 
     manner in which the original appointment was made. A vacancy 
     in the Board shall not affect the powers of the Board.
       (4) Quorum.--A majority of the members of the Board shall 
     constitute a quorum but a lesser number may hold hearings. 
     Any recommendation may be passed only by a majority of its 
     members present.
       (5) Chairperson and vice chairperson.--The chairperson and 
     vice chairperson of the Board shall be elected by the 
     members. The term of office of the chairperson and vice 
     chairperson shall be 1 year.
       (6) Meetings.--The Board shall meet at the call of the 
     chairperson or a majority of its members.
       (e) Gifts, Bequests, and Devises.--The Institute may 
     accept, administer, and use gifts or donations of services, 
     money, or property, both real and personal.
       (f) Mails.--The Board and the Institute may use the United 
     States mails in the same manner and under the same conditions 
     as other departments and agencies of the United States.
       (g) Staff.--The Interagency Group, after considering 
     recommendations made by the Board, shall appoint and fix the 
     pay of a Director.
       (h) Applicability of Certain Civil Service Laws.--The 
     Director and staff of the Institute may be appointed without 
     regard to the provisions of title 5, United States Code, 
     governing appointments in the competitive service, and may be 
     paid without regard to the provisions of chapter 51 and 
     subchapter III of chapter 53 of that title relating to 
     classification and General Schedule pay rates, except that an 
     individual so appointed may not receive pay in excess of the 
     maximum rate payable under section 5376 of title 5, United 
     States Code.
       (i) Experts and Consultants.--The Board and the Institute 
     may procure temporary and intermittent services under section 
     3109(b) of title 5, United States Code.
       (j) Report.--The Institute shall submit a biennial report 
     to the Interagency Group and the Congress.

     SEC. 442. NATIONAL LEADERSHIP ACTIVITIES.

       (a) In General.--The Secretary shall establish and carry 
     out a program of national leadership and evaluation 
     activities to enhance the quality of adult education and 
     family literacy programs nationwide.
       (b) Required Activity.--
       (1) In general.--The program of national leadership and 
     evaluation activities under subsection (a) shall include a 
     national evaluation, conducted by the Secretary, of the 
     programs and activities carried out by States and local 
     service providers with Federal funds received under this 
     subtitle. Such evaluation shall include information on the 
     following:
       (A) The manner in which States and local service providers 
     use Federal funds, including the manner in which States 
     allocate such funds among such providers.
       (B) The manner in which States establish goals and 
     performance standards and use such goals and standards to 
     manage and improve programs.
       (C) The effectiveness of the funds used under subparagraphs 
     (B) and (C) of section 432(a)(3).
       (D) The manner in which economically disadvantaged 
     individuals and educationally disadvantaged adults are being 
     served by States and local service providers.
       (E) The coordination between programs and activities 
     carried out with Federal funds received under titles II and 
     III and programs and activities carried out with Federal 
     funds received under this subtitle.
       (F) The percentage of individuals receiving a service from 
     an integrated career center system who are referred by such 
     system to a 

[[Page H 9022]]
     local service provider providing adult education or literacy services.
       (2) Report.--Not later than September 30, 2001, the 
     Secretary shall provide to the Congress and publicly publish 
     the results of the evaluation conducted under paragraph (1).
       (c) Authorized Activities.--
       (1) In general.--The program of national leadership and 
     evaluation activities under subsection (a) may include the 
     following:
       (A) Assisting States in developing levels of performance.
       (B) Research and development.
       (C) Demonstration of model and innovative programs.
       (D) Evaluations, including independent evaluations of adult 
     education and family literacy programs carried out with 
     financial assistance received pursuant to this subtitle.
       (E) Data collection.
       (F) Professional development.
       (G) Technical assistance to States and local service 
     providers receiving Federal financial assistance pursuant to 
     this subtitle.
       (H) Making grants to State or regional networks of literacy 
     resource centers described in section 432(a)(3)(D).
       (I) Other activities to enhance the quality of adult 
     education and family literacy programs nationwide.
       (2) Grants, contracts, and cooperative agreements.--The 
     Secretary may carry out the activities described in paragraph 
     (1) directly or through grants, contracts, and cooperative 
     agreements.
    Subtitle B--Library Services and Technology Consolidation Grant

     SEC. 451. PURPOSES.

       The purposes of this subtitle are--
       (1) to consolidate Federal library service programs;
       (2) to improve public access to information through 
     electronic networks; and
       (3) to provide linkages among and between libraries and 
     integrated career center systems.

     SEC. 452. AUTHORIZATION OF APPROPRIATIONS.

       (a) In General.--There are authorized to be appropriated to 
     carry out this subtitle $110,000,000 for each of the fiscal 
     years 1997 through 2002.
       (b) Advance Notice of Funding.--For the purpose of 
     affording adequate notice of funding available under this 
     subtitle, an appropriation to carry out this subtitle is 
     authorized to be included in an appropriation Act for the 
     fiscal year preceding the fiscal year for which such 
     appropriation is first available for obligation.

     SEC. 453. ALLOTMENTS.

       (a) Initial Allotments.--
       (1) In general.--From the sums appropriated under section 
     452 for any fiscal year, the Secretary shall allot--
       (A) $40,000 each to Guam, American Samoa, the Commonwealth 
     of the Northern Mariana Islands, and the Virgin Islands; and
       (B) $200,000 to each of the other States.
       (2) Ratable reduction.--If the sums appropriated under 
     section 452 for any fiscal year are insufficient to pay all 
     of the allotments under paragraph (1), each such allotment 
     shall be ratably reduced.
       (b) Additional Allotments.--
       (1) In general.--From the remainder of the sums 
     appropriated under section 452 for any fiscal year after the 
     application of subsection (a), the Secretary shall allot to 
     each State an amount which bears the same ratio to such 
     remainder as the population of the State bears to the 
     population of all States.
       (2) Determination of population of states.--For the purpose 
     of this subsection, the population of each State, and the 
     total population of all States, shall be determined by the 
     Secretary on the basis of the most recent census data 
     available to the Secretary, and the Secretary shall use for 
     such purpose, if available, the annual interim current census 
     data produced by the Secretary of Commerce pursuant to 
     section 181 of title 13, United States Code.

     SEC. 454. GRANTS TO STATES.

       (a) In General.--The Secretary shall make a grant for a 
     fiscal year to a State if the State--
       (1) has submitted to the Secretary for the year an annual 
     application that has been approved by the Secretary under 
     section 456; and
       (2) has entered into a written agreement with the Secretary 
     that--
       (A) the State will provide 100 percent of the funds paid to 
     the State under this subtitle for the year to the State 
     library administrative agency for the State;
       (B) such agency will be required to use such funds to carry 
     out activities that--
       (i) are described in such annual application;
       (ii) achieve the purposes of this subtitle; and
       (iii) satisfy the requirements of section 455;
       (C) there will be available from State and local sources 
     for expenditure by such agency to carry out such activities 
     an amount that equals or exceeds 25 percent of the total cost 
     (as determined by the Secretary) of carrying out such 
     activities for the year; and
       (D) such agency has the fiscal and legal authority and 
     capability to administer all aspects of such activities.
       (b) Amount of Grants.--The amount of a grant to a State 
     under subsection (a) for a fiscal year shall equal the lesser 
     of the following:
       (1) The sum of the initial and additional allotments of the 
     State for the year.
       (2) 75 percent of the total cost (as determined by the 
     Secretary) of carrying out the activities described in 
     subsection (a)(2)(B) for the year.

     SEC. 455. USES OF FUNDS.

       (a) In General.--Of the funds provided to a State library 
     administrative agency under section 454(a)(2)(A), the agency 
     shall expend (either directly or through subgrants or 
     cooperative agreements) at least 97 percent for one or more 
     of the following purposes:
       (1) Electronically connecting libraries with integrated 
     career center systems designated or established under section 
     107 and local service providers receiving grants under 
     paragraph (1) or (2) of section 432(a).
       (2) Establishing or enhancing linkages among libraries.
       (3) Assisting libraries in accessing information through 
     electronic networks.
       (4) Encouraging libraries in different Federal, State, and 
     local jurisdictions, and different types of libraries, to 
     establish consortia and share resources.
       (5) Paying costs for libraries to acquire or share computer 
     systems and telecommunications technologies.
       (6) Improving library and information services for 
     individuals who have difficulty using a library or who need 
     special library materials or services, including individuals 
     under the age of 18.
       (b) Administrative Expenses.--In any fiscal year, a State 
     library administrative agency may use not more than 3 percent 
     of the funds provided to the agency under section 
     454(a)(2)(A) for planning, administration, evaluations, and 
     interagency coordination associated with a grant under this 
     subtitle.

     SEC. 456. ANNUAL APPLICATIONS.

       (a) Submission.--A State that desires to receive a grant 
     under this subtitle for a fiscal year shall submit to the 
     Secretary, in such form and manner and before such deadline 
     as the Secretary shall specify in regulations, an application 
     for such year. Such application shall--
       (1) establish goals, and specify priorities, for the State 
     consistent with the purposes of this subtitle;
       (2) describe activities that are consistent with such goals 
     and priorities, the purposes of this subtitle, and the 
     requirements of section 455 that the State library 
     administrative agency will carry out during such year using 
     such grant;
       (3) describe the procedures that such agency will use to 
     carry out such activities;
       (4) describe the methodology that such agency will use to 
     evaluate the success of such activities in achieving such 
     goals and meeting such priorities;
       (5) describe procedures that such agency will use to 
     involve libraries and library users throughout the State in 
     policy decisions regarding implementation of this subtitle; 
     and
       (6) provide assurances satisfactory to the Secretary that 
     such agency will make such reports, in such form and 
     containing such information, as the Secretary may reasonably 
     require to carry out this subtitle and to determine the 
     extent to which funds provided under this subtitle have been 
     effective in carrying out its purposes.
       (b) Approval.--
       (1) In general.--The Secretary shall approve each 
     application submitted under subsection (a) that satisfies the 
     requirements of the subsection.
       (2) Rights of states upon disapproval.--If the Secretary 
     determines that an application submitted by a State under 
     subsection (a) does not satisfy the requirements of such 
     subsection, the Secretary shall--
       (A) immediately notify the State of such determination and 
     the reasons for such determination; and
       (B) offer the State an opportunity to revise its 
     application to correct any deficiencies.
           TITLE V--AMENDMENTS TO REHABILITATION ACT OF 1973
       Subtitle A--Vocational Rehabilitation Consolidation Grant

                      CHAPTER 1--TRANSITION PERIOD

     SEC. 501. TRANSITION.

       With respect to the amendment made by section 511(a)(4) to 
     title I of the Rehabilitation Act of 1973, the Secretary of 
     Education, acting through the Commissioner of the 
     Rehabilitation Services Administration, shall administer the 
     amendment in accordance with the following:
       (1) During fiscal year 1996, the Secretary shall develop 
     administrative policies for implementing the amendment.
       (2) During the fiscal years 1997 and 1998, the Secretary 
     shall begin implementing the amendment in accordance with 
     paragraph (4).
       (3) The Secretary shall ensure that, by the first day of 
     fiscal year 1999, the amendment is fully implemented.
       (4) For purposes of paragraph (2), the Secretary shall 
     ensure that, before the first day of fiscal year 1999, the 
     following requirements, administered as conditions on the 
     receipt of grants under such title, have been met:
       (A) The States have complied with section 103(b)(4) of such 
     title (as amended by section 511) regarding the participation 
     of certain providers.
       (B) The States have established policies and made 
     arrangements for the operation of the system of career grants 
     described in section 103(c) of such title, including with 
     respect to the reimbursement of providers.
       (C) The States have established policies and made 
     arrangements under section 103(b)(12) of such title regarding 
     the training of the management and staff of integrated 

[[Page H 9023]]
     career center systems with respect to individuals with disabilities.
       (D) The States have established policies and made 
     arrangements under section 104 of such title regarding the 
     establishment of such centers, including providing for the 
     significant participation of community-based providers in the 
     program carried out by the State pursuant to such title.
       (E) Such other requirements under the amendment as the 
     Secretary determines to be appropriate.
       (5)(A) Notwithstanding the amendment, during the fiscal 
     years 1996 through 1998, the provisions of title I of the 
     Rehabilitation Act of 1973 that were in effect on the day 
     before the date of the enactment of this Act continue to be 
     in effect, subject to paragraphs (1) through (4). In 
     implementing the amendment, the Secretary shall seek to avoid 
     unnecessarily disrupting the provision of services under such 
     title to individuals who, as of the date of the enactment of 
     this Act, were receiving services pursuant to an 
     individualized plan under such title.
       (B) On and after the first day of fiscal year 1999, the 
     provisions referred to in the first sentence of subparagraph 
     (A) do not have any legal effect.

      CHAPTER 2--REVISION OF TITLE I OF REHABILITATION ACT OF 1973

     SEC. 511. REVISION OF TITLE I.

       (a) In General.--Effective October 1, 1995, the 
     Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is 
     amended--
       (1) by transferring section 112 from the current placement 
     of the section;
       (2) by redesignating such section as section 510;
       (3) by adding such section at the end of title V; and
       (4) by amending title I to read as follows:
             ``TITLE I--VOCATIONAL REHABILITATION SERVICES

     ``SEC. 100. PURPOSE.

       ``The purpose of this title is to assist States in making 
     available to individuals with disabilities a program of 
     employment, training, and rehabilitation services that is 
     consistent with their strengths, resources, priorities, 
     concerns, abilities, and capabilities; that maximizes 
     individuals' control over their vocational and career 
     choices; and that is in accordance with the goal of assuring 
     equality of opportunity, full participation, independent 
     living, and economic self-sufficiency for such individuals.

     ``SEC. 101. FORMULA GRANTS.

       ``(a) In General.--
       ``(1) Formula grants.--In the case of each State that 
     submits to the Secretary a workforce development and literacy 
     plan for fiscal year 1999 or any subsequent fiscal year that 
     meets the requirement of section 104 of the Consolidated and 
     Reformed Education, Employment, and Rehabilitation Systems 
     Act, the Secretary shall make a grant for the year to the 
     State as the Federal share of carrying out the purposes 
     specified in this title. The grant shall consist of the 
     allotment determined for the State under section 107.
       ``(2) Conditions for grant.--A State may receive a grant 
     under paragraph (1) for a fiscal year only if the State meets 
     the conditions described in this title for the State for the 
     fiscal year.
       ``(b) Administrator of Federal Program.--The Secretary 
     shall carry out this title acting through the Commissioner of 
     the Rehabilitation Services Administration, except as 
     indicated otherwise.
       ``(c) Rule of Construction.--The purpose specified in 
     section 100 shall be carried out only in accordance with the 
     other provisions of this title.
       ``(d) Funding.--
       ``(1) Authorization of appropriations.--For the purpose of 
     carrying out this title, there are authorized to be 
     appropriated such sums as may be necessary for each of the 
     fiscal years 1999 through 2002, except that the amount to be 
     appropriated for a fiscal year shall not be less than the 
     amount of the appropriation under this subsection for the 
     immediately preceding fiscal year, plus the amount of the 
     Consumer Price Index addition determined under paragraph (2) 
     for the immediately preceding fiscal year.
       ``(2) Adjustments pursuant to consumer price index.--
       ``(A) Not later than November 15 of each fiscal year, the 
     Secretary of Labor shall publish in the Federal Register the 
     percentage change in the Consumer Price Index published for 
     October of the preceding fiscal year and October of the 
     fiscal year in which such publication is made.
       ``(B) If in any fiscal year the percentage change published 
     under subparagraph (A) indicates an increase in the Consumer 
     Price Index, then the amount to be appropriated under 
     paragraph (1) for the subsequent fiscal year shall be at 
     least the amount appropriated for the fiscal year in which 
     the publication is made under subparagraph (A) increased by 
     such percentage change.
       ``(C) If in any fiscal year the percentage change published 
     under subparagraph (A) does not indicate an increase in the 
     Consumer Price Index, then the amount to be appropriated 
     under paragraph (1) for the subsequent fiscal year shall be 
     at least the amount appropriated for the fiscal year in which 
     the publication is made under subparagraph (A).
       ``(D) For purposes of this paragraph, the term `Consumer 
     Price Index' means the Consumer Price Index for All Urban 
     Consumers, published monthly by the Bureau of Labor 
     Statistics.
       ``(3) Automatic extension of authorization.--
       ``(A) Unless, in the regular session that ends prior to the 
     beginning of the last fiscal year for which an authorization 
     of appropriations is provided in paragraph (1), legislation 
     has been enacted that has the effect of extending such 
     authorization, such authorization is automatically extended 
     for one additional year.
       ``(B) The amount authorized to be appropriated for the 
     additional fiscal year described in subparagraph (A) shall be 
     an amount equal to the amount appropriated for such program 
     for fiscal year 2002, plus the amount of the Consumer Price 
     Index addition determined under paragraph (2) for the 
     immediately preceding fiscal year.
       ``(C) In any case where the Commissioner is required under 
     an applicable statute to carry out certain acts or make 
     certain determinations that are necessary for the 
     continuation of the program authorized by this title, and 
     such acts or determinations are required during the last 
     fiscal year for which an authorization of appropriations is 
     provided in paragraph (1), such acts and determinations shall 
     be required during any fiscal year for which subparagraph (A) 
     is in operation.

     ``SEC. 102. ALLOCATION WITHIN STATE OF ADMINISTRATIVE 
                   RESPONSIBILITIES.

       ``(a) In General.--For purposes of section 101(a), a State 
     will--
       ``(1) subject to subsection (b), reserve not more than 20 
     percent of the grant under such section for the fiscal year 
     involved for carrying out the responsibilities of a State 
     administrative agent under section 103; and
       ``(2) reserve not less than 80 percent of the grant for 
     carrying out the responsibilities under section 104 of local 
     workforce development boards and integrated career center 
     systems with respect to workforce development areas.
       ``(b) Additional State Responsibilities.--Amounts reserved 
     by a State under subsection (a)(1) may be expended by the 
     State administrative agent to carry out responsibilities that 
     otherwise would be carried out under section 104 by local 
     workforce development boards or integrated career center 
     systems, if the State determines that such expenditures are 
     justified to make available goods and services that could not 
     otherwise be obtained within a local workforce development 
     area, to provide services to individuals unable to utilize 
     the integrated career center systems, or to otherwise ensure 
     the efficient and equitable provision in the State of 
     services under this title, including the provision of 
     services for individuals in rural areas.
       ``(c) Certain Definitions.--For purposes of this Act, the 
     terms `State administrative agent', `local workforce 
     development area', `local workforce development board', and 
     `integrated career center' have the meanings given such terms 
     in sections 105 through 108, respectively, of the 
     Consolidated and Reformed Education, Employment, and 
     Rehabilitation Systems Act.

     ``SEC. 103. RESPONSIBILITIES OF STATE ADMINISTRATIVE AGENT.

       ``(a) State Administrative Agent.--In carrying out the 
     requirements of the Consolidated and Reformed Education, 
     Employment, and Rehabilitation Systems Act, a Governor may 
     designate--
       ``(1) one State administrative agent to be responsible for 
     carrying out this title for individuals who are blind; and
       ``(2) a different State administrative agent to carry out 
     the remaining responsibilities in this title.
       ``(b) Responsibilities.--For purposes of section 101(a) and 
     the operation in a State of the program under this title:
       ``(1) This subsection, and the subsequent provisions of 
     this section, will be carried out by State administrative 
     agents designated by the Governor in accordance with 
     subsection (a), through the collaborative process established 
     under section 103 of the Consolidated and Reformed Education, 
     Employment, and Rehabilitation Systems Act.
       ``(2)(A) The State will provide to the public an 
     explanation of the methods by which the State will provide 
     vocational rehabilitation services (as defined in section 
     104(b))--
       ``(i) to all eligible individuals (as defined in section 
     105(d)); and
       ``(ii) within all local workforce delivery areas in the 
     State.
       ``(B) In the event that such services cannot be provided to 
     all eligible individuals who apply for the services, the 
     State will show and provide the justification for the order 
     to be followed in selecting individuals to whom the services 
     will be provided.
       ``(C) The order of selection under subparagraph (B) will be 
     determined on the basis of serving first those individuals 
     with the most severe disabilities, in accordance with 
     criteria established by the State.
       ``(3) The State will establish guidelines providing that, 
     in the case of an individual to whom the State will provide a 
     service (in accordance with the order of selection under 
     paragraph (2) and the assessment of needs under section 
     104(c)(1)), the individual will have the option of receiving 
     the service from a provider designated by the center or from 
     a provider selected by the individual pursuant to career 
     grants under subsection (c).
       ``(4) Pursuant to section 109 of the Consolidated and 
     Reformed Education, Employment, and Rehabilitation Systems 
     Act, the State will make significant efforts to encourage the 
     participation in the State program of community-based private 
     providers, 

[[Page H 9024]]
     with special consideration given to providers who have received funds 
     under this Act regarding projects with industry or supported 
     employment services, or under the Act commonly known as the 
     Javits-Wagner-O'Day Act (41 U.S.C. 46 et seq.) for employment 
     and training services.
       ``(5) The State will establish provisions to govern 
     determinations under section 105 (relating to the eligibility 
     of individuals).
       ``(6) The State will establish standards to govern the 
     conduct under section 104(c)(1) of assessments of need, 
     including the development of a methodology that will be 
     applied in a reasonably uniform manner to all individuals for 
     whom such assessments are conducted, and that (subject to the 
     order of selection under paragraph (2)) will be designed to 
     prevent substantial disparities, among individuals with 
     comparable circumstances, in the monetary value of the 
     services to be provided pursuant to the assessments.
       ``(7)(A) The State will establish procedures through which 
     an individual may request and obtain an impartial review, 
     utilizing an impartial hearing officer, of whether standards 
     for determinations of eligibility for services, assessments 
     of vocational rehabilitation needs, and development of 
     individualized rehabilitation and employment plans under this 
     title were correctly applied to the individual by the 
     integrated career center system involved.
       ``(B) The State will designate a number of days (applied 
     uniformly to all individuals) within which review under 
     subparagraph (A) will be conducted once a request for such 
     review is made by an individual, subject to subparagraph (C).
       ``(C)(i) The State will provide that there may be an 
     informal hearing, mediation, or alternatives to such review, 
     if agreed upon by the individual and the integrated career 
     center system involved.
       ``(ii) The State will provide that if, in a process 
     utilized under clause (i) by an individual, there is a not a 
     final disposition of the matter involved, review under 
     subparagraph (A) will remain available to the individual.
       ``(8) The State will ensure that vocational rehabilitation 
     services under this title, and related core services, are 
     provided by personnel who are qualified to provide the 
     services involved. For purposes of the preceding sentence, 
     the term `core services' has the meaning indicated for such 
     term under title I of the Consolidated and Reformed 
     Education, Employment, and Rehabilitation Systems Act.
       ``(9) The State will establish plans, policies, and 
     procedures to be followed in carrying out the program under 
     this title in the State (including entering into a formal 
     interagency cooperative agreement with education officials 
     responsible for the provision of a free appropriate public 
     education to students who are individuals with disabilities). 
     The State will ensure that such plans, policies, and 
     procedures are designed in accordance with the following:
       ``(A)(i) To facilitate the development and accomplishment 
     of the goals and objectives described in clause (ii) 
     (including the specification of plans for coordination with 
     the educational agencies in the provision of transition 
     services), to the extent that the goals and objectives are 
     included in an individualized education program of a student.
       ``(ii) The goals and objectives referred to in clause (i) 
     are long-term rehabilitation goals; intermediate 
     rehabilitation objectives; and goals and objectives related 
     to enabling a student to live independently before the 
     student leaves a school setting.
       ``(B) To facilitate the transition from the provision of a 
     free appropriate public education under the responsibility of 
     an educational agency to the provision of vocational 
     rehabilitation services under this title, including the 
     specification of plans for coordination with educational 
     agencies in the provision of transition services to an 
     individual.
       ``(C) To provide for--
       ``(i) provisions for determining State lead agencies and 
     qualified personnel responsible for transition services;
       ``(ii) procedures for outreach to and identification of 
     youth in need of such services; and
       ``(iii) a timeframe for evaluation and follow-up of youth 
     who have received such services.
       ``(10) The State will provide for coordination and working 
     relationships with the Statewide Independent Living Council 
     established under section 705 and independent living centers 
     within the State.
       ``(11) The State will provide for interagency cooperation 
     with, and the utilization of the services and facilities of, 
     the State agencies administering the State's public 
     assistance programs, and other programs for individuals with 
     disabilities.
       ``(12) With respect to the integrated career center system 
     operated pursuant to section 104, the State will provide for 
     the appropriate training of the management and staff of the 
     centers regarding the effective provision of services to 
     individuals with disabilities.
       ``(13) The State will provide technical assistance to local 
     boards, integrated career center systems, and providers 
     relating to the effective provision of vocational 
     rehabilitation services under this title, including the 
     effective development of individualized rehabilitation and 
     employment plans, and will ensure that such technical 
     assistance is provided through appropriate means.
       ``(c) Availability of Career Grants System Regarding 
     Services.--For purposes of section 101(a) and the operation 
     in a State of the program under this title:
       ``(1) The State will provide for the establishment of a 
     system to carry out this subsection.
       ``(2) In the case of an eligible individual who (in 
     accordance with the order of selection under subsection 
     (b)(2) and the assessment of needs under section 
     105(b)(2)(A)) will receive vocational rehabilitation services 
     under this title, the integrated career center involved will, 
     upon request of the individual, provide to the individual 
     career grants in accordance with this subsection.
       ``(3) Career grants under this subsection will enable such 
     individual to obtain the vocational rehabilitation services 
     involved from providers selected by the individual from among 
     a list of providers approved by the State for such purpose in 
     accordance with section 109 of the Consolidated and Reformed 
     Education, Employment, and Rehabilitation Systems Act.
       ``(4) The monetary value of a career grant provided to the 
     individual for a particular type of service will be 
     calculated at a fair market value.
       ``(5) To the extent practicable, the list of providers 
     under paragraph (3) will provide for the availability within 
     each local workforce development area of a broad range of 
     services.
       ``(6) The aggregate value of the career grants available to 
     the individual will be established in proportion to the 
     degree of the individual's need for rehabilitation (as 
     determined under section 104(c)(1)). Such value regarding the 
     individuals may be adjusted to address emerging needs that 
     arise during the course of the individual's rehabilitation 
     and employment program.
       ``(d) State Options.--With respect to compliance with this 
     section, a State may, in the discretion of the State, expend 
     a grant under section 101 for the following:
       ``(1) To disseminate findings from research regarding 
     vocational rehabilitation services, after consideration of 
     requests from local workforce development boards and 
     integrated career center systems regarding the types of 
     information needed by such boards and centers.
       ``(2) To conduct demonstration projects regarding 
     improvements with respect to vocational rehabilitation 
     services, subject to providing the results of such projects 
     to the Commissioner and as appropriate disseminating the 
     results within the State.

     ``SEC. 104. RESPONSIBILITIES FOR LOCAL BOARDS AND SERVICE 
                   CENTERS.

       ``(a) Provision of Vocational Rehabilitation Services.--For 
     purposes of section 101(a) and the operation in a State of 
     the program under this title:
       ``(1) This section will be carried out by the integrated 
     career center system in the State, with each such center 
     acting under the guidance of the local workforce development 
     board for the local workforce area within which the 
     integrated career center system operates. Such centers will 
     provide services under this section directly or through 
     contract.
       ``(2) In accordance with the order of selection under 
     section 103(b)(2), an integrated career center system will, 
     in expending amounts provided to the center from a grant 
     under section 101, carry out the following:
       ``(A) Make determinations under section 105 of the 
     eligibility of individuals for vocational rehabilitation 
     services (as defined in subsection (b)).
       ``(B) Provide for vocational rehabilitation services for 
     eligible individuals.
       ``(C) In the case of individuals with severe disabilities, 
     conduct outreach and intake activities for such individuals 
     who are not able to directly access the integrated career 
     center system because of the nature of their disabilities.
       ``(3) An integrated career center system will, in expending 
     amounts provided to the center from a grant under section 
     101, make vocational rehabilitation services available at a 
     variety of locations and, as appropriate for particular 
     populations, in a variety of environments.
       ``(b) Definition.--For purposes of this title, the term 
     `vocational rehabilitation services' means such goods or 
     services for eligible individuals as are--
       ``(1) necessary to render the individuals employable and 
     achieve an employment outcome; and
       ``(2) provided in response to needs that arise, to a 
     significant extent, from the disability involved and do not 
     duplicate, to any significant extent, the core services 
     available under title I of the Consolidated and Reformed 
     Education, Employment, and Rehabilitation Systems Act.
       ``(c) Certain Services.--For purposes of section 101(a), 
     the vocational rehabilitation services available through 
     integrated career center systems will include the following:
       ``(1) An assessment of the needs of eligible individuals 
     for such services.
       ``(2) Development, in accordance with section 105(b)(2), of 
     an individualized rehabilitation and employment plan for the 
     purpose of identifying employment goals, appropriate 
     intermediate rehabilitation objectives, and an appropriate 
     combination of goods and services for the individual to 
     achieve the employment goals.
       ``(3) Counseling, guidance, and work-related placement 
     services for individuals with disabilities, including job 
     search assistance, placement assistance, job retention 
     services, personal assistance services, and follow-up, 
     follow-along, and specific postemployment 

[[Page H 9025]]
     services necessary to assist such individuals to maintain, regain, or 
     advance in employment.
       ``(4) Vocational and other training services for 
     individuals with disabilities, including personal and 
     vocational adjustment, books, or other training materials, 
     and such services to the families of such individuals as are 
     necessary to the adjustment or rehabilitation of such 
     individuals.
       ``(5) Rehabilitation technology services.
       ``(6) Supported employment services.
       ``(7) Physical and mental restoration services.
       ``(8) Interpreter services for individuals who are deaf, 
     and reader services for individuals who are blind.
       ``(9) Rehabilitation teaching services and orientation and 
     mobility services for individuals who are blind.
       ``(10) Referral and other services designed to assist 
     individuals with disabilities in securing needed services 
     from other agencies through agreements developed under 
     section 103(b)(10), if such services are not available under 
     this Act.
       ``(11) Transportation in connection with the rendering of 
     any vocational rehabilitation service.
       ``(12) Telecommunications, sensory, and other technological 
     aids and devices.
       ``(13) On-the-job, or other related personal-assistance 
     services, provided while eligible individuals are receiving 
     other vocational rehabilitation services under this title.
       ``(d) Certain Arrangements.--For purposes of section 
     101(a), an integrated career center system will, with respect 
     to the provision of vocational rehabilitation services to 
     individuals with the most severe disabilities, provide for 
     necessary arrangements with community-based providers, 
     including arrangements regarding supported employment 
     services and extended services, periodic reviews of 
     individuals placed in extended employment, and services to 
     promote movement from extended employment to integrated 
     employment.
       ``(e) Optional Provision of Other Services.--For purposes 
     of this title, an integrated career center system may provide 
     such vocational rehabilitation services in addition to the 
     services specified in subsection (c) as the center determines 
     to be appropriate.
       ``(f) Allocation for Core Services.--For purposes of 
     section 101(a):
       ``(1) With respect to a fiscal year, a local workforce 
     development board receiving amounts from a grant under 
     section 101 will reserve an amount for the provision of core 
     services under title I of the Consolidated and Reformed 
     Education, Employment, and Rehabilitation Systems Act.
       ``(2) The amount so reserved will be based on the number of 
     eligible individuals with disabilities in the local workforce 
     development area and the costs of training employees of the 
     integrated career center system to provide high-quality 
     services to individuals with disabilities.
       ``(g) Performance Payments Regarding Career Grants.--For 
     purposes of section 101(a):
       ``(1) The local workforce development board involved will 
     ensure that, in providing for the payment of services 
     provided pursuant to career grants, a portion of the total 
     payment is withheld from the provider until the delivery of 
     the services involved is completed in reasonable accordance 
     with the outcome designated for the service pursuant to a 
     prior understanding with the provider.
       ``(2) In the case of education, training, and placement 
     services that are designed to lead to an employment outcome, 
     a portion of the total payment will be withheld from the 
     provider until--
       ``(A) the participant has successfully completed the 
     training; and
       ``(B) the participant has been employed, and has retained 
     employment for a period of not less than 90 days.
       ``(h) Payor of Last Resort Regarding Medical Services and 
     Educational Assistance.--For purposes of section 101(a), a 
     State will not expend a grant under section 101 to pay for 
     training services in institutions of higher education, or to 
     pay for medical services, unless significant efforts have 
     been made to secure payments, in whole or in part, from other 
     sources, except that such efforts are not required if making 
     the efforts would delay the provision of such services to any 
     eligible individual who is at extreme medical risk, or if 
     making the efforts would result in the loss of a job 
     placement that (but for the efforts) would be immediately 
     available to an eligible individual.

     ``SEC. 105. ELIGIBLE INDIVIDUAL.

       ``(a) In General.--For purposes of section 101:
       ``(1) An individual will not receive vocational 
     rehabilitation services under this title unless the 
     individual--
       ``(A) is an individual with a disability under section 
     7(8)(A); and
       ``(B) requires vocational rehabilitation services to 
     prepare for, enter, engage in, or retain gainful employment.
       ``(2) If the individual has a disability or is blind as 
     determined pursuant to title II or title XVI of the Social 
     Security Act, the individual will be considered to have--
       ``(A) a physical or mental impairment which for such 
     individual constitutes or results in a substantial impediment 
     to employment under section 7(8)(A)(i); and
       ``(B) a severe physical or mental impairment which 
     seriously limits one or more functional capacities in terms 
     of an employment outcome under section 7(15)(A)(i).
       ``(3) It will be presumed that an individual can benefit in 
     terms of an employment outcome from vocational rehabilitation 
     services for purposes of section 7(8)(A)(ii), unless the 
     integrated career center system involved can demonstrate by 
     clear and convincing evidence that such individual is 
     incapable of benefiting from vocational rehabilitation 
     services in terms of an employment outcome.
       ``(b) Process.--For purposes of section 101(a), a State 
     will ensure that, subject to the order of selection under 
     section 102(b)(2), the following applies to an individual:
       ``(1) Once the individual makes a request in person for a 
     determination of eligibility:
       ``(A) A qualified rehabilitation adviser will be made 
     available to the individual regarding the process of 
     obtaining services under this title.
       ``(B) An initial interview will be conducted, followed by 
     an initial assessment.
       ``(C) A final determination will be made not later than 30 
     days after the request (subject to the cooperation of the 
     individual in the process of determination).
       ``(D) The determination of eligibility will be based on the 
     review of existing data described in clause (i) of section 
     7(22)(A), and, to the extent necessary, the preliminary 
     assessment described in clause (ii) of such section.
       ``(E) If it is determined that the individual is not an 
     eligible individual, the individual will be provided a 
     written statement explaining the following:
       ``(i) The basis of the determination.
       ``(ii) The availability of impartial review under section 
     103(b)(7).
       ``(iii) The availability of services under the client 
     assistance program under section 510.
       ``(2)(A) If it is determined that the individual is an 
     eligible individual--
       ``(i) the needs of the individual for vocational 
     rehabilitation services will be assessed; and
       ``(ii) subject to subparagraph (D), an individualized 
     rehabilitation and employment plan will be developed for the 
     individual regarding the provision of services pursuant to 
     clause (i).
       ``(B) The plan under subparagraph (A) will be developed and 
     mutually agreed upon by the individual and an appropriate 
     staff member of the integrated career center system involved.
       ``(C) A plan under subparagraph (A) is individualized if 
     the plan is consistent with the unique strengths, resources, 
     priorities, concerns, abilities, and capabilities of the 
     individual for whom the plan is developed.
       ``(D) A plan under subparagraph (A) is not required for an 
     individual if the individual signs a waiver stating that such 
     a plan is not necessary for the individual.
       ``(c) Rule of Construction.--This title may not be 
     construed as establishing an entitlement in any individual.
       ``(d) Definition.--For purposes of this title, the term 
     `eligible individual' means an individual described in 
     subsection (a)(1).

     ``SEC. 106. STATE REHABILITATION ADVISORY COUNCIL.

       ``(a) In General.--For purposes of section 101(a):
       ``(1) A State will establish a State Rehabilitation 
     Advisory Council (referred to in this section as the 
     `Council') in accordance with this section.
       ``(2) The Council will be composed of the following:
       ``(A) Representatives of organizations within the State 
     providing services to individuals with disabilities and their 
     families, including representatives of the client assistance 
     program under section 510.
       ``(B) Representatives of business, industry, and labor.
       ``(C) Representatives of disability advocacy groups 
     representing a cross section of--
       ``(i) individuals with physical, cognitive, sensory, and 
     mental disabilities; and
       ``(ii) parents, family members, guardians, advocates, or 
     authorized representatives, of individuals with disabilities 
     who have difficulty in representing themselves or are unable 
     due to their disabilities to represent themselves.
       ``(3) The State administrative agent will be an ex officio 
     member of the Council.
       ``(4) Members of the Council will be appointed by the 
     Governor or another entity that has appointment authority 
     under State law.
       ``(5) A majority of Council members will be persons who 
     are--
       ``(A) individuals with disabilities described in section 
     7(8)(B); and
       ``(B) not employed by the designated State administrative 
     agent.
       ``(6)(A) Except as provided in subparagraph (B), the 
     Council will select a chairperson from among the membership 
     of the Council.
       ``(B) In States in which the Governor does not have veto 
     power pursuant to State law, the Governor will designate a 
     member of the Council to serve as the chairperson of the 
     Council or will require the Council to so designate such a 
     member.
       ``(7) Each member of the Council will serve for a term 
     determined by the Governor or another entity that has 
     appointment authority under State law.
       ``(8) Any vacancy occurring in the membership of the 
     Council will be filled in the same manner as the original 
     appointment. The vacancy will not affect the power of the 
     remaining members to execute the duties of the Council.

[[Page H 9026]]

       ``(b) Functions of Council.--For purposes of section 
     101(a), the Council will carry out the following:
       ``(1) Advise the collaborative process under section 103 of 
     the Consolidated and Reformed Education, Employment, and 
     Rehabilitation Systems Act, and the State administrative 
     agent, in the preparation of the State workforce development 
     and literacy plan and other plans, reports, needs 
     assessments, and evaluations required by this title.
       ``(2) To the extent feasible, conduct a review and analysis 
     of the effectiveness of, and consumer satisfaction with, the 
     delivery of core services and vocational rehabilitation 
     services to individuals with disabilities within the State.
       ``(3) Prepare and submit an annual report to the 
     collaborative process or appropriate State administrative 
     agent and the Commissioner on the status of vocational 
     rehabilitation programs operated within the State, and make 
     the report available to the public.
       ``(4) Coordinate with other councils within the State 
     established to address the needs of individuals with 
     disabilities.
       ``(5) Perform such other functions, consistent with the 
     purpose of this title, as the State Rehabilitation Advisory 
     Council determines to be appropriate, that are comparable to 
     the other functions performed by the Council.
       ``(c) Resources.--
       ``(1) Plan.--For purposes of section 101(a), the Council 
     will prepare, in conjunction with the State administrative 
     agent, a plan for the provision of such resources, including 
     such staff and other personnel, as may be necessary to carry 
     out the functions of the Council under this section. The 
     resource plan shall, to the maximum extent possible, rely on 
     the use of resources in existence during the period of 
     implementation of the plan.
       ``(2) Resolution of disagreements.--For purposes of section 
     101(a), to the extent that there is a disagreement between 
     the Council and the State administrative agent in regard to 
     the resources necessary to carry out the functions of the 
     Council as set forth in this section, the disagreement will 
     be resolved by the Governor or appointing agency identified 
     in subsection (a)(4).
       ``(3) Supervision and evaluation.--For purposes of section 
     101(a), the Council will, consistent with State law, 
     supervise and evaluate such staff and other personnel as may 
     be necessary to carry out its functions under this section.
       ``(4) Personnel conflict of interest.--For purposes of 
     section 101(a), while assisting the Council in carrying out 
     its duties, staff and other personnel will not be assigned 
     duties by the State administrative agent or any other agency 
     or office of the State, that would create a conflict of 
     interest.
       ``(d) Conflict of Interest.--For purposes of section 
     101(a), no member of the Council will cast a vote on any 
     matter that would provide direct financial benefit to the 
     member or otherwise give the appearance of a conflict of 
     interest under State law.
       ``(e) Meetings.--For purposes of section 101(a), the 
     Council will convene meetings and conduct such forums or 
     hearings as the Council considers appropriate. The meetings, 
     hearings, and forums will be publicly announced. The meetings 
     will be open and accessible to the general public unless 
     there is a valid reason for an executive session.
       ``(f) Compensation and Expenses.--For purposes of section 
     101(a), the Council may use funds appropriated under this 
     title to reimburse members of the Council for reasonable and 
     necessary expenses of attending Council meetings and 
     performing Council duties (including child care and personal 
     assistance services), and to pay compensation to a member of 
     the Council, if such member is not employed or must forfeit 
     wages from other employment, for each day the member is 
     engaged in performing the duties of the Council.
       ``(g) Rule of Construction.--Nothing in this section 
     prohibits a State from establishing and providing funds to a 
     separate council to carry out functions described in 
     subsection (b) with respect to vocational rehabilitation 
     services for individuals who are blind.

     ``SEC. 107. AMOUNT OF ALLOTMENT.

       ``(a)(1) Subject to the provisions of subsection (d), for 
     each fiscal year beginning before October 1, 1978, each State 
     shall be entitled to an allotment of an amount bearing the 
     same ratio to the amount authorized to be appropriated under 
     section 101(d) for allotment under this section as the 
     product of (A) the population of the State, and (B) the 
     square of its allotment percentage, bears to the sum of the 
     corresponding products for all the States.
       ``(2)(A) For each fiscal year beginning on or after October 
     1, 1978, each State shall be entitled to an allotment in an 
     amount equal to the amount such State received under 
     paragraph (1) for the fiscal year ending September 30, 1978, 
     and an additional amount determined pursuant to subparagraph 
     (B) of this paragraph.
       ``(B) For each fiscal year beginning on or after October 1, 
     1978, each State shall be entitled to an allotment, from any 
     amount authorized to be appropriated for such fiscal year 
     under section 101(d) for allotment under this section in 
     excess of the amount appropriated under such section for the 
     fiscal year ending September 30, 1978, in an amount equal to 
     the sum of--
       ``(i) an amount bearing the same ratio to 50 percent of 
     such excess amount as the product of the population of the 
     State and the square of its allotment percentage bears to the 
     sum of the corresponding products for all the States; and
       ``(ii) an amount bearing the same ratio to 50 percent of 
     such excess amount as the product of the population of the 
     State and its allotment percentage bears to the sum of the 
     corresponding products for all the States.
       ``(3) The sum of the payment to any State (other than Guam, 
     American Samoa, the Virgin Islands, and the Northern Mariana 
     Islands) under this subsection for any fiscal year which is 
     less than one-third of 1 percent of the amount appropriated 
     under section 101(d), or $3,000,000, whichever is greater, 
     shall be increased to that amount, the total of the increases 
     thereby required being derived by proportionately reducing 
     the allotment to each of the remaining such States under this 
     subsection, but with such adjustments as may be necessary to 
     prevent the sum of the allotments made under this subsection 
     to any such remaining State from being thereby reduced to 
     less than that amount.
       ``(4) For each fiscal year beginning on or after October 1, 
     1984, for which any amount is appropriated pursuant to 
     section 101(d), each State shall receive an allocation (from 
     such appropriated amount) in addition to the allotment to 
     which such State is entitled under paragraphs (2) and (3) of 
     this subsection. Such additional allocation shall be an 
     amount which bears the same ratio to the amount so 
     appropriated as that State's allotment under paragraphs (2) 
     and (3) of this subsection bears to the sum of such 
     allotments of all the States.
       ``(b)(1) If the payment to a State pursuant to this section 
     for a fiscal year is less than the total payments such State 
     received under section 2 of the Rehabilitation Act for the 
     fiscal year ending June 30, 1973, such State shall be 
     entitled to an additional payment (subject to the same terms 
     and conditions applicable to other payments under this title) 
     equal to the difference between the payment under this 
     section and the amount so received by it.
       ``(2) If a State receives as its Federal share pursuant to 
     this section for any fiscal year less than the applicable 
     Federal share of the expenditure of such State for fiscal 
     year 1972 for vocational rehabilitation services under the 
     plan for such State approved under section 101 as in effect 
     for such year (including any amount expended by such State 
     for the administration of the State plan but excluding any 
     amount expended by such State from non-Federal sources for 
     construction under such plan), such State shall be entitled 
     to an additional payment for such fiscal year, subject to the 
     same terms and conditions applicable to other payments under 
     this title, equal to the difference between such the payment 
     pursuant to this section and an amount equal to the 
     applicable Federal share of such expenditure for vocational 
     rehabilitation services.
       ``(3) Any payment attributable to the additional payment to 
     a State under this subsection shall be made only from 
     appropriations specifically made to carry out this 
     subsection, and such additional appropriations are hereby 
     authorized.
     ``SEC. 108. STATE OPTION FOR WAIVERS REGARDING ALTERNATIVE 
                   DELIVERY SYSTEMS.

       ``(a) In General.--In the case of the requirements 
     specified in subsection (b), the Secretary shall provide to a 
     State a waiver of such requirements as the State elects, if 
     (subject to the other provisions of this section) the 
     following conditions are met:
       ``(1) The Governor, through the collaborative process under 
     section 103 of the Consolidated and Reformed Education, 
     Employment, and Rehabilitation Systems Act, develops a 
     proposed plan for alternative approaches (to be implemented 
     by the State in lieu of the requirements involved).
       ``(2) The proposal is approved by each local workforce 
     development board in whose local workforce development area 
     the proposal (or any component of the proposal) is to be 
     effective.
       ``(3) The local workforce development boards involved, and 
     the Governor, determine that the following conditions have 
     been met:
       ``(A) The proposal will better fulfill the purposes of this 
     title than would compliance with the requirements involved.
       ``(B) In the development of the alternative approaches, the 
     public was afforded a reasonable opportunity to comment on 
     the proposed alternative approaches.
       ``(4) The Governor submits to the Secretary the following 
     documents:
       ``(A) A notification that the State is electing to receive 
     a waiver under this section.
       ``(B) A copy of the plan involved.
       ``(C) Such documents as the Secretary may require for 
     purposes of verifying that the conditions established in 
     paragraphs (1) through (3) have been met.
       ``(b) Certain Requirements Regarding State Administrative 
     Structure for Delivery of Services.--The requirements 
     referred to in subsection (a) are as follows:
       ``(1) The allocation under section 102 of amounts between 
     State administrative agents and local workforce development 
     boards.
       ``(2) The allocation under sections 103 and 104 of 
     responsibilities between State administrative agents and 
     local workforce development boards (including the use of 
     integrated career center systems to provide vocational 
     rehabilitation services).

[[Page H 9027]]

       ``(3) The specification under section 103(a) of the State 
     officials who are to administer the requirements of section 
     103.
       ``(c) Applicability of Waiver; Review and Revision of 
     Plan.--
       ``(1) Applicability.--A waiver under subsection (a) is 
     effective for a fiscal year only if the documents under 
     paragraph (4) of such subsection are submitted to the 
     Secretary not later than 60 days before the beginning of the 
     fiscal year.
       ``(2) Review of plan.--A waiver under subsection (a) is 
     effective for such fiscal years as the State involved elects, 
     except that, not less than once during each period of three 
     fiscal years, the plan under the waiver is required (as a 
     condition of the waiver remaining in effect) to be reviewed, 
     and approved, by the Governor (through the collaborative 
     process referred to in such subsection) and by the local 
     workforce development boards involved.
       ``(3) Revision of plan.--The plan under a waiver under 
     subsection (a) may be revised. Such subsection applies to 
     such a revision to the same extent and in the same manner as 
     the subsection applies to the original plan.
       ``(d) Performance Accountability System.--A waiver under 
     subsection (a) for a State does not, with respect to carrying 
     out the program under this title in the State, affect the 
     applicability to the State of section 110 of the Consolidated 
     and Reformed Education, Employment, and Rehabilitation 
     Systems Act.''.
       (b) Certain Funding Provision.--Effective October 1, 1995, 
     the Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is 
     amended by inserting after section 3 the following section:


                        ``availability of funds

       ``Sec. 3A. Notwithstanding any other provision of law, 
     funding to carry out titles II through VII for any fiscal 
     year is available only to such extent and in such amounts as 
     may be provided in advance in appropriations Acts.''.
       (c) Conforming Amendments.--Effective October 1, 1995, the 
     Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is amended 
     in the table of contents in the first section--
       (1) by inserting after the item relating to section 3 the 
     following item:

``Sec. 3A. Availability of funds.'';
       (2) by striking the items relating to sections 100 through 
     109, to sections 110 through 112, to sections 120 through 
     124, to section 130, and to sections 140 and 141;
       (3) by striking the items relating to the title designation 
     and heading for title I, and to the part designations and 
     headings for parts A, B, C, D, and E of title I;
       (4) by inserting after the item relating to section 21 the 
     following items:

             ``TITLE I--VOCATIONAL REHABILITATION SERVICES

``Sec. 100. Purpose.
``Sec. 101. Formula grants.
``Sec. 102. Allocation within State of administrative responsibilities.
``Sec. 103. Responsibilities of State administrative agent.
``Sec. 104. Responsibilities for local boards and service centers.
``Sec. 105. Eligible individual.
``Sec. 106. State Rehabilitation Advisory Council.
``Sec. 107. Amount of allotment.
``Sec. 108. State option for waivers regarding alternative delivery 
              systems.'';

     and
       (5) by inserting after the item relating to section 509 the 
     following item:

``Sec. 510. Client assistance program.''.
       Subtitle B--Other Amendments to Rehabilitation Act of 1973

     SEC. 521. TRAINING AND DEMONSTRATION PROJECTS.

       (a) In General.--Effective October 1, 1995, the 
     Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is 
     amended--
       (1) in title III--
       (A) by striking section 303;
       (B) by striking section 304;
       (C) in section 311--
       (i) by striking subsections (c) and (f); and
       (ii) by redesignating subsections (d) and (e) as 
     subsections (c) and (d), respectively;
       (D) by striking section 312; and
       (E) by striking section 316;
       (2)(A) by transferring subsection (a) of section 802 from 
     the current placement of the subsection;
       (B) by redesignating such subsection as subsection (e); and
       (C) by inserting such subsection at the end of section 311 
     (as amended by paragraph (1)(C) of this subsection);
       (3)(A) by transferring subsection (g) of section 802 from 
     the current placement of the subsection; and
       (B) by redesignating such subsection as subsection (f); and
       (C) by inserting such subsection at the end of section 311 
     (as amended by paragraph (2)(C) of this subsection);
       (4)(A) by transferring subsection (c) of section 803 from 
     the current placement of the subsection;
       (B) by redesignating such subsection as subsection (g); and
       (C) by inserting such subsection at the end of section 311 
     (as amended by paragraph (3)(C) of this subsection);
       (5)(A) by transferring subsection (b) of section 803 from 
     the current placement of the subsection;
       (B) by redesignating such subsection as subsection (j); and
       (C) by inserting such subsection at the end of section 302; 
     and
       (6) by striking the remaining provisions of title VIII.
       (b) Conforming Amendments.--Effective October 1, 1995, the 
     Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is amended 
     in the table of contents in the first section--
       (1) by striking the items relating to sections 303, 304, 
     312, and 316;
       (2) by striking the items relating to sections 801 through 
     803 of title VIII; and
       (3) by striking the item relating to the title designation 
     and heading for title VIII.

     SEC. 522. EMPLOYMENT OPPORTUNITIES FOR INDIVIDUALS WITH 
                   DISABILITIES.

       (a) In General.--Effective October 1, 1995, title VI of the 
     Rehabilitation Act of 1973 (29 U.S.C. 795 et seq.) is 
     amended--
       (1) by striking part A;
       (2) by striking part C;
       (3) by striking part D; and
       (4) in part B, by striking the part designation and 
     heading.
       (b) Projects With Industry.--Effective October 1, 1998, 
     title VI of the Rehabilitation Act of 1973, as amended by 
     subsection (a) of this section, is repealed.
       (c) Conforming Amendments.--Effective October 1, 1995, the 
     Rehabilitation Act of 1973 (29 U.S.C. 701 et seq.) is amended 
     in the table of contents in the first section by striking the 
     items relating to sections 611 through 617, to sections 631 
     through 638, and to section 641; and by striking the items 
     relating to the part designations and headings for parts A, 
     B, C, and D of title VI. Effective October 1, 1998, such 
     table of contents is amended by striking the items relating 
     to sections 621 through 623; and by striking the item 
     relating to the title designation and heading for title VI.

     SEC. 523. CERTAIN AMOUNTS.

       (a) Amounts Regarding Fiscal Year 1996.--With respect to 
     the aggregate amount that was available for fiscal year 1995 
     as direct spending for carrying out the programs under 
     section 311(c), section 316, and part C of title VI of the 
     Rehabilitation Act of 1973 (as such provisions were in effect 
     for such fiscal year), an amount equal to such aggregate 
     amount is hereby made available for fiscal year 1996 as 
     direct spending for carrying out title I of such Act (in 
     addition to the amount of direct spending that otherwise is 
     available for such title I for fiscal year 1996).
       (b) Amounts Regarding Fiscal Year 1999.--With respect to 
     the amount made available in appropriations Act for fiscal 
     year 1998 for carrying out title VI of the Rehabilitation Act 
     of 1973 (as such title was in effect for such fiscal year), 
     an amount equal to such amount is hereby made available for 
     fiscal year 1999 as direct spending for carrying out title I 
     of such Act (in addition to the amount of direct spending 
     that otherwise is available for such title I for fiscal year 
     1999).
                TITLE VI--HIGHER EDUCATION PRIVATIZATION

     SEC. 601. REORGANIZATION OF THE STUDENT LOAN MARKETING 
                   ASSOCIATION THROUGH THE FORMATION OF A HOLDING 
                   COMPANY.

       (a) Amendment.--Part B of title IV of the Higher Education 
     Act of 1965 (20 U.S.C. 1071 et seq.) is amended by inserting 
     after section 439 (20 U.S.C. 1087-2) the following new 
     section:

     ``SEC. 440. REORGANIZATION OF THE STUDENT LOAN MARKETING 
                   ASSOCIATION THROUGH THE FORMATION OF A HOLDING 
                   COMPANY.

       ``(a) Actions by the Association's Board of Directors.--The 
     Board of Directors of the Association shall take or cause to 
     be taken all such action as it deems necessary or appropriate 
     to effect, upon the shareholder approval described in 
     subsection (b), a restructuring of the common stock ownership 
     of the Association, as set forth in a plan of reorganization 
     adopted by the Board of Directors (the terms of which shall 
     be consistent with this Act) so that all of the outstanding 
     common shares shall be directly owned by an ordinary business 
     corporation chartered under State or District of Columbia law 
     (the `Holding Company'), as the Board of Directors may 
     determine. Such actions may include, in the Board's 
     discretion, a merger of a wholly owned subsidiary of the 
     Holding Company with and into the Association, which would 
     have the effect provided in the plan of reorganization and 
     the law of the jurisdiction in which such subsidiary is 
     incorporated. As part of the restructuring, the Board of 
     Directors may cause (1) the common shares of the Association 
     to be converted, at the reorganization effective date, to 
     common shares of the Holding Company on a one for one basis, 
     consistent with applicable State or District of Columbia law, 
     and (2) Holding Company common shares to be registered with 
     the Securities and Exchange Commission.
       ``(b) Shareholder Approval.--The plan of reorganization 
     adopted by the Board of Directors pursuant to subsection (a) 
     shall be submitted to common stockholders of the Association 
     for their approval. The reorganization shall occur at the 
     reorganization effective date, provided that the plan of 
     reorganization has been approved by the affirmative votes, 
     cast in person or by proxy, of the holders of a majority of 
     the issued and outstanding shares of the Association common 
     stock.
       ``(c) Transition.--
       ``(1) In general.--Except as specifically provided in this 
     section, until the dissolution date the Association shall 
     continue to have all of the rights, privileges and 
     obligations 

[[Page H 9028]]
     set forth in, and shall be subject to all of the limitations and 
     restrictions of, section 439 of this Act as in effect on the 
     effective date of this section, and the Association shall 
     continue to carry out the purposes of such section. The 
     Holding Company and its affiliates other than the Association 
     shall not be entitled to any of the rights, privileges and 
     obligations, and shall not be subject to the limitations and 
     restrictions, applicable to the Association under section 439 
     of this Act as in effect on the effective date of this 
     section, except as specifically provided in this section. The 
     Holding Company and its subsidiaries (other than the 
     Association) shall not purchase loans insured under this Act 
     until such time as the Association ceases acquiring such 
     loans, except that the Association shall continue to acquire 
     loans as a lender of last resort pursuant to section 439(q) 
     of this Act or under an agreement with the Secretary 
     described in section 440(c)(6).
       ``(2) Transfer of certain property.--Except as specifically 
     provided in this section, at the reorganization effective 
     date or as soon as practicable thereafter, the Association 
     shall use its best efforts to transfer to the Holding Company 
     or its subsidiaries (or both), in each case, as directed by 
     the Holding Company, all real and personal property of the 
     Association (both tangible and intangible) other than the 
     remaining property. Without limiting the preceding sentence, 
     such transferred property shall include all right, title and 
     interest in (A) direct or indirect subsidiaries of the 
     Association (excluding any interest in any government 
     sponsored enterprise), (B) contracts, leases, and other 
     agreements, (C) licenses and other intellectual property, and 
     (D) any other property of the Association. Notwithstanding 
     the preceding provisions of this paragraph, nothing in this 
     paragraph shall be construed to prohibit the Association from 
     transferring remaining property from time to time to the 
     Holding Company or its subsidiaries, subject to the 
     provisions of paragraph (4).
       ``(3) Transfer of personnel.--At the reorganization 
     effective date, employees of the Association shall become 
     employees of the Holding Company (or of the subsidiaries), 
     and the Holding Company (or the subsidiaries or both) shall 
     provide all necessary and appropriate management and 
     operational support (including loan servicing) to the 
     Association, as requested by the Association. The Association 
     may, however, obtain such management and operational support 
     from other persons or entities.
       ``(4) Dividends.--The Association may pay dividends in the 
     form of cash or noncash distributions so long as at the time 
     of the declaration of such dividends, after giving effect to 
     the payment of such dividends as of the date of such 
     declaration by the Board of Directors of the Association, the 
     Association's capital would be in compliance with the capital 
     standards set forth in section 439(r) of this Act. If, at any 
     time after the reorganization effective date, the Association 
     fails to comply with such capital standards, the Holding 
     Company shall be obligated to transfer to the Association 
     additional capital in such amounts as are necessary to ensure 
     that the Association again complies with the capital 
     standards.
       ``(5) Valuation of noncash distributions.--After the 
     reorganization effective date, any distribution of noncash 
     assets by the Association to the Holding Company shall be 
     valued at book value on the date the Association's Board of 
     Directors approved such distribution for purposes of 
     calculating compliance with section 439(r) of this Act.
       ``(6) Restrictions on new business activity or acquisition 
     of assets by association.--After the reorganization effective 
     date, the Association shall not engage in any new business 
     activities or acquire any additional program assets described 
     in section 439(d) of the Act other than--
       ``(A) in connection with (i) student loan purchases through 
     September 30, 2003, and (ii) contractual commitments for 
     future warehousing advances or pursuant to letters of credit 
     or standby bond purchase agreements which are outstanding as 
     of the reorganization effective date;
       ``(B) in connection with its serving as a lender-of-last-
     resort pursuant to section 439 of this Act; and
       ``(C) in connection with its purchase of loans insured 
     under this part, if the Secretary, with the approval of the 
     Secretary of the Treasury, enters into an agreement with the 
     Association for the continuation or resumption of its 
     secondary market purchase program because the Secretary 
     determines there is inadequate liquidity for loans made under 
     this part.

     The Secretary is authorized to enter into an agreement 
     described in subparagraph (C) with the Association covering 
     such secondary market activities.
     Any agreement entered into under subparagraph (C) shall cover 
     a period of 12 months, but may be renewed if the Secretary 
     determines that liquidity remains inadequate. The fee 
     provided under section 439(h)(7) shall not apply to loans 
     acquired under any such agreement with the Secretary.
       ``(7) Issuance of debt obligations during the transition 
     period; attributes of debt obligations.--After the 
     reorganization effective date, the Association shall not 
     issue debt obligations which mature later than September 30, 
     2007, except in connection with serving as a lender-of-last-
     resort pursuant to section 439 of this Act or with purchasing 
     loans under an agreement with the Secretary as described in 
     paragraph (6) of this subsection. Nothing in this subsection 
     shall modify the attributes accorded the debt obligations of 
     the Association by section 439, regardless of whether such 
     debt obligations are incurred prior to, or at any time 
     following, the reorganization effective date or are 
     transferred to a trust in accordance with subsection (d).
       ``(8) Monitoring of safety and soundness.--
       ``(A) Obligation to obtain, maintain, and report 
     information.--The Association shall obtain such information 
     and make and keep such records as the Secretary of the 
     Treasury may from time to time prescribe concerning (i) the 
     financial risk to the Association resulting from the 
     activities of any of its associated persons, to the extent 
     such activities are reasonably likely to have a material 
     impact on the financial condition of the Association, 
     including its capital ratio, its liquidity, or its ability to 
     conduct and finance its operations, and (ii) the 
     Association's policies, procedures, and systems for 
     monitoring and controlling any such financial risk. The 
     Association's obligations under this subsection with respect 
     to any associated person which is a third party servicer (as 
     defined in 34 C.F.R. 682.200(b)) shall be limited to 
     providing to the Secretary of the Treasury copies of any 
     reports or other information provided to the Secretary of 
     Education pursuant to 34 C.F.R. 682.200 et seq. The Secretary 
     of the Treasury may require summary reports of such 
     information to be filed no more frequently than quarterly. 
     For purposes of this paragraph, the term `associated person' 
     shall mean any person, other than a natural person, directly 
     or indirectly controlling, controlled by, or under common 
     control with the Association.
       ``(B) Separate operation of corporations.--
       ``(i) The funds and assets of the Association shall at all 
     times be maintained separately from the funds and assets of 
     the Holding Company or any of its other subsidiaries and may 
     be used solely by the Association to carry out its purposes 
     and to fulfill its obligations.
       ``(ii) The Association shall maintain books and records 
     that clearly reflect the assets and liabilities of the 
     Association, separate from the assets and liabilities of the 
     Holding Company or any of its other subsidiaries.
       ``(iii) The Association shall maintain a corporate office 
     that is physically separate from any office of the Holding 
     Company or any of its subsidiaries.
       ``(iv) No director of the Association that is appointed by 
     the President pursuant to section 439(c)(1)(A) may serve as a 
     director of the Holding Company.
       ``(v) At least one officer of the Association shall remain 
     an officer solely of the Association.
       ``(vi) Transactions between the Association and the Holding 
     Company or its other subsidiaries, including any loan 
     servicing arrangements, shall be on terms no less favorable 
     to the Association than the Association could obtain from an 
     unrelated third party offering comparable services.
       ``(vii) The Association shall not extend credit to the 
     Holding Company or any of its affiliates, nor guarantee or 
     provide any credit enhancement to any debt obligations of the 
     Holding Company or any of its affiliates.
       ``(viii) Any amounts collected on behalf of the Association 
     by the Holding Company or any of its other subsidiaries with 
     respect to the assets of the Association, pursuant to a 
     servicing contract or other arrangement between the 
     Association and the Holding Company or any of its other 
     direct or indirect subsidiaries, shall be collected solely 
     for the benefit of the Association and shall be immediately 
     deposited by the Holding Company or such other subsidiary to 
     an account under the sole control of the Association.
       ``(C) Encumbrance of assets.--Notwithstanding any otherwise 
     applicable Federal or State law, rule, or regulation, or 
     legal or equitable principle, doctrine, or theory to the 
     contrary, under no circumstances shall the assets of the 
     Association be available or used to pay claims or debts of or 
     incurred by the Holding Company. Nothing in this subparagraph 
     shall limit the right of the Association to pay dividends not 
     otherwise prohibited hereunder or limit any liability of the 
     Holding Company explicitly provided for in this part.
       ``(D) Holding company activities.--After the reorganization 
     effective date and prior to the dissolution of the 
     Association in accordance with section 440(d), Holding 
     Company activities shall be limited to ownership of the 
     Association and any other subsidiaries. All business 
     activities shall be conducted through subsidiaries.
       ``(9) Association board of directors.--Notwithstanding any 
     other provision of part B of this title, after the 
     reorganization effective date, the 14 directors of the 
     Association elected by the Association's stockholders (which 
     immediately after the reorganization effective date shall be 
     the Holding Company) shall no longer be required to meet the 
     eligibility requirements set forth in section 439(c).
       ``(10) Issuance of stock warrants.--At the reorganization 
     effective date, the Holding Company shall issue to the 
     Secretary of the Treasury 200,000 stock warrants, each 
     entitling the holder of the stock warrant to purchase from 
     the Holding Company one share of the registered common stock 
     of the Holding Company at any time on or before September 30, 
     2007. The exercise price for such warrants shall be an amount 
     equal to the average closing price of the common stock of the 
     Association for the 20 business days prior 

[[Page H 9029]]
     to and including the date of enactment of this section on the exchange 
     or market which is then the primary exchange or market for 
     the common stock of the Association, subject to any 
     adjustments necessary to reflect the conversion of 
     Association common stock into Holding Company common stock as 
     part of the plan of reorganization approved by the 
     Association's shareholders.
       ``(11) Restrictions on transfer of association shares and 
     bankruptcy of association.--After the reorganization 
     effective date, the Holding Company shall not sell, pledge, 
     or otherwise transfer the outstanding shares of the 
     Association, or agree to or cause the liquidation of the 
     Association or cause the Association to file a petition for 
     bankruptcy under title 11, United States Code, without prior 
     approval of the Secretary of the Treasury and the Secretary 
     of Education.
       ``(d) Termination of the Association.--The Association 
     shall dissolve, and its separate existence shall terminate on 
     September 30, 2007, after discharge of all outstanding debt 
     obligations and liquidation pursuant to this subsection. The 
     Association may dissolve pursuant to this subsection prior to 
     such date by notifying the Secretary of Education and the 
     Secretary of the Treasury of its intention to dissolve, 
     unless within 60 days of receipt of such notice the Secretary 
     of Education notifies the Association that it continues to be 
     needed to serve as a lender of last resort pursuant to 
     section 439(q) of this Act or continues to be needed to 
     purchase loans under an agreement with the Secretary 
     described in subsection (c)(6) of this section. On the 
     dissolution date, the Association shall take the following 
     actions:
       ``(1) Establishment of a trust.--The Association shall, 
     under the terms of an irrevocable trust agreement in form and 
     substance satisfactory to the Secretary of the Treasury, the 
     Association and the appointed trustee, irrevocably transfer 
     all remaining obligations of the Association to the trust and 
     irrevocably deposit or cause to be deposited into such trust, 
     to be held as trust funds solely for the benefit of holders 
     of the remaining obligations, money or direct noncallable 
     obligations of the United States of America or any agency 
     thereof for which payment the full faith and credit of the 
     United States is pledged, maturing as to principal and 
     interest in such amounts and at such times as are determined 
     by the Secretary of the Treasury to be sufficient, without 
     consideration of any significant reinvestment of such 
     interest, to pay the principal of, and interest on, the 
     remaining obligations in accordance with their terms. To the 
     extent the Association cannot provide money or qualifying 
     obligations in the amount required, the Holding Company shall 
     be required to transfer money or qualifying obligations to 
     the trust in the amount necessary to prevent any deficiency.
       ``(2) Use of trust assets.--All money, obligations, or 
     financial assets deposited into the trust pursuant to this 
     subsection shall be applied by the trustee to the payment of 
     the remaining obligations assumed by the trust. Upon the 
     fulfillment of the trustee's duties under the trust, any 
     remaining assets of the trust shall be transferred to the 
     Holding Company or its subsidiaries, or both, as directed by 
     the Holding Company.
       ``(3) Obligations not transferred to the trust.--The 
     Association shall make proper provision for all other 
     obligations of the Association, including the repurchase or 
     redemption, or the making of proper provision for the 
     repurchase or redemption, of any preferred stock of the 
     Association then outstanding. Any obligations of the 
     Association which cannot be fully satisfied shall become 
     liabilities of the Holding Company as of the date of 
     dissolution.
       ``(4) Transfer of remaining assets.--After compliance with 
     paragraphs (1), and (3), the Association shall transfer to 
     the Holding Company any remaining assets of the Association.
       ``(e) Operation of the Holding Company.--
       ``(1) Holding company board of directors.--The number and 
     composition of the Board of Directors of the Holding Company 
     shall be determined as set forth in the Holding Company's 
     charter or like instrument (as amended from time to time) or 
     bylaws (as amended from time to time) and as permissible 
     under the laws of the jurisdiction of its incorporation.
       ``(2) Holding company name.--The names of the Holding 
     Company and any subsidiary of the Holding Company other than 
     the Association--
       ``(A) may not contain the name `Student Loan Marketing 
     Association'; and
       ``(B) may contain, to the extent permitted by applicable 
     State or District of Columbia law, `Sallie Mae', or 
     variations thereof or such other names as the Board of 
     Directors of the Association of the Holding Company shall 
     deem appropriate.
       ``(3) Use of sallie mae name.--Without limiting paragraph 
     (2), the Association may assign to the Holding Company, or 
     any other subsidiary of the Holding Company, the `Sallie Mae' 
     name as a trademark and service mark, except that neither the 
     Holding Company nor any subsidiary of the Holding Company 
     other than the Association or a subsidiary of the Association 
     may use the `Sallie Mae' name on, or to identify the issuer 
     of, any debt obligation or other security offered or sold by 
     the Holding Company or any such subsidiary. The Association 
     shall remit to the Secretary of Treasury $5,000,000 during 
     fiscal year 1996 as compensation for the right to assign such 
     trademark or service mark.
       ``(4) Disclosure required.--Until 3 years after the 
     dissolution date, the Holding Company, and any subsidiary of 
     the Holding Company other than the Association, shall 
     prominently display--
       ``(A) in any document offering its securities, that the 
     obligations of the Holding Company and any such subsidiary 
     are not guaranteed by the full faith and credit of the United 
     States; and
       ``(B) in any advertisement or promotional materials which 
     use the `Sallie Mae' name or mark, a statement that neither 
     the Holding Company nor any such subsidiary is a Government-
     sponsored enterprise or instrumentality of the United States.
       ``(f) Strict Construction.--Except as specifically set 
     forth in this section, nothing contained in this section 
     shall be construed to limit the authority of the Association 
     as a federally chartered corporation, or of the Holding 
     Company as a State or District of Columbia chartered 
     corporation.
       ``(g) Right To Enforce.--The Secretary of Education or the 
     Secretary of the Treasury, as appropriate, may request the 
     Attorney General of the United States to bring an action in 
     the United States District Court for the District of Columbia 
     for the enforcement of any provisions of this section, or 
     may, under the direction or control of the Attorney General, 
     bring such an action. Such court shall have jurisdiction and 
     power to order and require compliance with this section.
       ``(h) Deadline for Reorganization Effective Date.--This 
     section shall be of no further force and effect in the event 
     that the reorganization effective date does not occur on or 
     before 18 months after the date of enactment of this section.
       ``(i) Definitions.--For purposes of this section:
       ``(1) The term `Association' means the Student Loan 
     Marketing Association.
       ``(2) The term `dissolution date' shall mean September 30, 
     2007, or such earlier date as the Secretary of Education 
     permits the transfer of remaining obligations in accordance 
     with subsection (d) of this section.
       ``(3) The term `reorganization effective date' means the 
     effective date of the reorganization as determined by the 
     Board of Directors of the Association, which shall not be 
     earlier than the date that stockholder approval is obtained 
     pursuant to subsection (b) of this section and shall not be 
     later than the date that is 18 months after the date of 
     enactment of this section.
       ``(4) The term `Holding Company' means the new business 
     corporation formed pursuant to this section by the 
     Association under the laws of any State of the United States 
     or the District of Columbia.
       ``(5) The term `remaining obligations' shall mean the debt 
     obligations of the Association outstanding as of the 
     dissolution date.
       ``(6) The term `remaining property' shall mean the 
     following assets and liabilities of the Association which are 
     outstanding as of the reorganization effective date: (A) debt 
     obligations issued by the Association, (B) contracts relating 
     to interest rate, currency, or commodity positions or 
     protections, (C) investment securities owned by the 
     Association, (D) any instruments, assets, or agreements 
     described in section 439(d) of this Act (including without 
     limitation all student loans, forward purchase and lending 
     commitments, warehousing advances, academic facilities 
     obligations, letters of credit, standby bond purchase 
     agreements, liquidity agreements, and student loan revenue 
     bonds or other loans), and (E) except as specifically 
     prohibited by this Act, any other nonmaterial assets or 
     liabilities of the Association which the Association's Board 
     of Directors determines to be necessary or appropriate to its 
     operations.
       ``(7) The term `reorganization' means the restructuring 
     event or events (including any merger event) giving effect to 
     the holding company structure described in subsection (a) of 
     this section.
       ``(8) The term `subsidiary' or `subsidiaries' shall mean 
     one or more direct or indirect subsidiaries of the Holding 
     Company.''.
       (b) Technical Amendments.--
       (1) Amendments to the higher education act.--Effective on 
     the reorganization effective date (as defined in section 
     440(h)(3) of the Higher Education Act of 1965, as added by 
     subsection (a))--
       (A) section 435(d)(1)(F) of such Act (20 U.S.C. 
     1085(d)(1)(F)) is amended by inserting after ``Student Loan 
     Marketing Association'' the following: ``or the Holding 
     Company of the Student Loan Marketing Association, including 
     all subsidiaries of such Holding Company, created pursuant to 
     section 440 of this Act,''; and
       (B) sections 435(d)(1)(G) and 428C(a)(1)(A) of such Act (20 
     U.S.C. 1085(d)(1)(G); 1078-3(a)(1)(A)) are each amended by 
     inserting after ``Student Loan Marketing Association'' the 
     following: ``or the Holding Company of the Student Loan 
     Marketing Association, including all subsidiaries of such 
     Holding Company, created pursuant to section 440 of this 
     Act''.
       (2) Enforcement of safety and soundness requirements.--
     Section 439(r) of the Higher Education Act of 1965 (20 U.S.C. 
     1087-2(r)) is amended--
       (A) by redesignating paragraph (13) as paragraph (15); and
       (B) by inserting after paragraph (12) the following new 
     paragraph:

[[Page H 9030]]

       ``(13) Enforcement of safety and soundness requirements.--
     The Secretary of Education or the Secretary of the Treasury, 
     as appropriate, may request the Attorney General of the 
     United States to bring an action in the United States 
     District Court for the District of Columbia for the 
     enforcement of any provisions of this subsection, or may, 
     under the direction or control of the Attorney General, bring 
     such an action. Such court shall have jurisdiction and power 
     to order and require compliance with this subsection.''.
       (3) Capital ratio amendments.--Section 439(r) of the Higher 
     Education Act of 1965 is further amended--
       (A) in paragraph (1)--
       (i) by striking ``and'' at the end of subparagraph (A);
       (ii) by striking the period at the end of subparagraph (B) 
     and inserting ``; and''; and
       (iii) by adding at the end the following new subparagraph:
       ``(C) within 45 days of the end of each fiscal quarter, (i) 
     financial statements of the Association, and (ii) a report 
     setting forth the calculation of the capital ratio of the 
     Association.'';
       (B) in paragraph (11), by striking ``paragraphs (4) and 
     (6)(A)'' and inserting ``paragraphs (4), (6)(A), and (14)''; 
     and
       (C) by inserting after paragraph (13) (as added by 
     paragraph (2) of this subsection) the following new 
     paragraph:
       ``(14) Actions by secretary.--If the shareholders of the 
     Association shall have approved a reorganization plan in 
     accordance with section 440(b) and, for any fiscal quarter 
     ended after January 1, 2000, the Association shall have a 
     capital ratio of less than 2.25 percent, the Secretary of the 
     Treasury may, until such capital ratio is met, take any one 
     or more of the actions described in paragraph (7), except 
     that--
       ``(A) the capital ratio to be restored pursuant to 
     paragraph (7)(D) shall be 2.25 percent; and
       ``(B) if the relevant capital ratio is in excess of or 
     equal to 2 percent for such quarter, the Secretary of the 
     Treasury shall defer taking any of the actions set forth in 
     paragraph (7) until the next succeeding quarter and may then 
     proceed with any such action only if the capital ratio of the 
     Association remains below 2.25 percent.

     Upon approval by the shareholders of the Association of a 
     reorganization plan in accordance with section 440(b) for any 
     period after January 1, 2000, the provisions of paragraphs 
     (4), (5), (6), (8), (9), and (10) shall be of no further 
     application to the Association.''.
       (4) Repeal of the association's charter.--Effective on the 
     dissolution date (as defined in section 440(h)(2) of the 
     Higher Education Act of 1965, as added by subsection (a)), 
     section 439 of such Act (20 U.S.C. 1087-2) is repealed.

     SEC. 602. PRIVATIZATION OF COLLEGE CONSTRUCTION LOAN 
                   INSURANCE ASSOCIATION.

       (a) Repeal of Statutory Restrictions.--Part D of title VII 
     of the Higher Education Act of 1965 (20 U.S.C. 1132f et seq.) 
     is repealed.
       (b) Status of the Corporation.--
       (1) Status of the corporation.--The Corporation shall not 
     be an agency, instrumentality, or establishment of the United 
     States Government and shall not be a ``Government 
     corporation'' nor a ``Government controlled corporation'' as 
     defined in section 103 of title 5, United States Code. No 
     action under section 1491 of title 28, United States Code 
     (commonly known as the Tucker Act) shall be allowable against 
     the United States based on the actions of the Corporation.
       (2) Corporate powers.--The Corporation shall have the power 
     to engage in any business or other activities for which 
     corporations may be organized under the laws of any State of 
     the United States or the District of Columbia. The 
     Corporation shall have the power to enter into contracts, to 
     execute instruments, to incur liabilities, to provide 
     products and services, and to do all things as are necessary 
     or incidental to the proper management of its affairs and the 
     efficient operation of a private, for-profit business.
       (c) Related Privatization Requirements.--
       (1) Notice requirements.--During the 5-year period 
     following the date of the enactment of this Act, the 
     Corporation shall include in any document offering the 
     Corporation's securities, in any contracts for insurance, 
     guarantee, or reinsurance of obligations, and in any 
     advertisement or promotional material, a statement that--
       (A) the Corporation is not a Government-sponsored 
     enterprise or instrumentality of the United States; and
       (B) the Corporation's obligations are not guaranteed by the 
     full faith and credit of the United States.
       (2) Corporate charter.--The Corporation's charter shall be 
     amended as necessary and without delay to conform the 
     requirements of this Act.
       (3) Corporate name.--The name of the Corporation, or of any 
     direct or indirect subsidiary thereof, may not contain the 
     term ``College Construction Loan Insurance Association''.
       (4) Articles of incorporation.--The Corporation shall amend 
     its articles of incorporation without delay to reflect that 
     one of the purposes of the Corporation shall be to guarantee, 
     insure and reinsure bonds, leases, and other evidences of 
     debt of educational institutions, including Historically 
     Black Colleges and Universities and other academic 
     institutions which are ranked in the lower investment grade 
     category using a nationally recognized credit rating system.
       (5) Transition requirements.--
       (A) Requirements until stock sale.--Notwithstanding 
     subsection (a), the requirements of section 754 of the Higher 
     Education Act of 1965 (20 U.S.C. 1132f-3), as in existence as 
     of the day before enactment of this Act, shall continue to be 
     effective until the day immediately following the date of 
     closing of the purchase of the Secretary's stock (or the date 
     of closing of the final purchase, in the case of multiple 
     transactions) pursuant to subsection (d) of this section.
       (B) Reports after stock sale.--The Corporation shall, not 
     later than March 30 of the first full calendar year 
     immediately following the sale pursuant to subsection (d), 
     and each of the 2 succeeding years, submit to the Secretary 
     of Education a report describing the Corporation's efforts to 
     assist in the financing of education facilities projects, 
     including projects for elementary, secondary, and 
     postsecondary educational institution infrastructure, and 
     detailing, on a project-by-project basis, the Corporation's 
     business dealings with educational institutions that are 
     rated by a nationally recognized statistical rating 
     organization at or below the organization's third highest 
     ratings.
       (d) Sale of Federally Owned Stock.--
       (1) Sale of stock required.--The Secretary of the Treasury 
     shall, upon the request of the Secretary of Education make 
     every effort to sell, pursuant to section 324 of title 31, 
     United States Code, the voting common stock of the 
     Corporation owned by the Secretary of Education not later 
     than one year after the date of the enactment of this Act.
       (2) Purchase by the corporation.--In the event that the 
     Secretary of the Treasury is unable to sell the voting common 
     stock, or any portion thereof, at a price acceptable to the 
     Secretary of Education and the Secretary of the Treasury 
     within the period specified in paragraph (1), the Corporation 
     shall purchase such stock at a price determined by the 
     Secretary of the Treasury and acceptable to the Corporation 
     based on independent appraisal by one or more nationally 
     recognized financial firms. Such firms shall be selected by 
     the Secretary of the Treasury in consultation with the 
     Secretary of Education and the Corporation.
       (e) Assistance by the Corporation.--The Corporation shall 
     provide such assistance as the Secretary of the Treasury and 
     the Secretary of Education may require to facilitate the sale 
     of the stock under this section.
       (f) Definition.--As used in this section, the term 
     ``Corporation'' means the Corporation established pursuant to 
     the provision of law repealed by subsection (a).
               TITLE VII--REPEALERS AND OTHER AMENDMENTS

     SEC. 701. HIGHER EDUCATION PROVISIONS.

       (a) Higher Education Act of 1965 Provisions.--The following 
     provisions of the Higher Education Act of 1965 are repealed:
       (1) Part B of title I (20 U.S.C. 1011 et seq.), relating to 
     articulation agreements.
       (2) Part C of title I (20 U.S.C. 1015 et seq.), relating to 
     access and equity to education for all Americans through 
     telecommunications.
       (3) Title II (20 U.S.C. 1021 et seq.), relating to academic 
     libraries and information services.
       (4) Chapter 2 of subpart 2 of part A of title IV (20 U.S.C. 
     1070a-21 et seq.), relating to national early intervention 
     scholarships.
       (5) Chapter 3 of subpart 2 of part A of title IV (20 U.S.C. 
     1070a-31 et seq.), relating to presidential access 
     scholarships.
       (6) Chapter 4 of subpart 2 of part A of title IV (20 U.S.C. 
     1070a-41 et seq.), relating to model program community 
     partnerships and counseling grants.
       (7) Chapter 5 of subpart 2 of part A of title IV (20 U.S.C. 
     1070a-52 et seq.), relating to an early awareness information 
     program.
       (8) Chapter 8 of subpart 2 of part A of title IV (20 U.S.C. 
     1070a-81), relating to technical assistance for teachers and 
     counselors.
       (9) Subpart 8 of part A of title IV (20 U.S.C. 1070f), 
     relating to special child care services for disadvantaged 
     college students.
       (10) Section 428J (20 U.S.C. 1078-10), relating to loan 
     forgiveness for teachers, individuals performing national 
     community service and nurses.
       (11) Section 486 (20 U.S.C. 1093), relating to training in 
     financial aid services.
       (12) Subpart 1 of part H of title IV (20 U.S.C. 1099a et 
     seq.) relating to State postsecondary review entity programs.
       (13) Part A of title V (20 U.S.C. 1102 et seq.), relating 
     to State and local programs for teacher excellence.
       (14) Part B of title V (20 U.S.C. 1103 et seq.), relating 
     to national teacher academies.
       (15) Subpart 1 of part C of title V (20 U.S.C. 1104 et 
     seq.), relating to Douglas teacher scholarships.
       (16) Subpart 3 of part C of title V (20 U.S.C. 1106 et 
     seq.), relating to the teacher corps.
       (17) Subpart 3 of part D of title V (20 U.S.C. 1109 et 
     seq.), relating to class size demonstration grants.
       (18) Subpart 4 of part D of title V (20 U.S.C. 1110 et 
     seq.), relating to middle school teaching demonstration 
     programs.
       (19) Subpart 1 of part E of title V (20 U.S.C. 1111 et 
     seq.), relating to new teaching careers.
       (20) Subpart 1 of part F of title V (20 U.S.C. 1113 et 
     seq.), relating to the national mini corps programs.
       (21) Section 586 (20 U.S.C. 1114), relating to 
     demonstration grants for critical language and area studies. 

[[Page H 9031]]

       (22) Section 587 (20 U.S.C. 1114a), relating to development 
     of foreign languages and cultures instructional materials.
       (23) Subpart 3 of part F of title V (20 U.S.C. 1115), 
     relating to small State teaching initiatives.
       (24) Subpart 4 of part F of title V (20 U.S.C. 1116), 
     relating to faculty development grants.
       (25) Section 597 and section 599(b) (20 U.S.C. 1117a, 
     1117c(b)), relating to early childhood staff training and 
     professional enhancement.
       (26) Section 605 (20 U.S.C. 1124a), relating to intensive 
     summer language institutes.
       (27) Section 607 (20 U.S.C. 1125a), relating to foreign 
     language periodicals.
       (28) Part A of title VII (20 U.S.C. 11326 et seq.), 
     relating to academic and library facilities.
       (29) Title VIII (20 U.S.C. 1133 et seq.), relating to 
     cooperative education programs.
       (30) Part A of title IX (20 U.S.C. 1134a et seq.), relating 
     to women and minority participation in graduate education.
       (31) Part B of title IX (20 U.S.C. 1134d et seq.), relating 
     to Harris fellowships.
       (32) Part C of title IX (20 U.S.C. 1134h et seq.), relating 
     to Javits fellowships.
       (33) Part E of title IX (20 U.S.C. 1134r et seq.), relating 
     to the faculty development fellowship program.
       (34) Part F of title IX (20 U.S.C. 1134s et seq.), relating 
     to legal training for the disadvantaged.
       (35) Part G of title IX (20 U.S.C. 1134u et seq.), relating 
     to law school clinical programs.
       (36) Section 1011 (20 U.S.C. 1135a-11), relating to special 
     projects in areas of national need.
       (37) Subpart 2 of part B of title X (20 U.S.C. 1135c et 
     seq.), relating to science and engineering access programs.
       (38) Part C of title X (20 U.S.C. 1135e et seq.), relating 
     to women and minorities science and engineering outreach 
     demonstration programs.
       (39) Part D of title X (20 U.S.C. 1135f), relating to 
     Eisenhower leadership programs.
       (40) Title XI (20 U.S.C. 1136 et seq.), relating to 
     community service programs.
       (b) Education Amendments of 1986 Provisions.--The following 
     provisions of the Higher Education Amendments of 1986 are 
     repealed:
       (1) Part E of title XIII (20 U.S.C. 1221-1 note), relating 
     to a National Academy of Science study.
       (2) Part B of title XV (20 U.S.C. 4441 et seq.), relating 
     to Native Hawaiian culture and art development.
       (c) Education Amendments of 1992 Provisions.--The following 
     provisions of the Higher Education Amendments of 1992 are 
     repealed:
       (1) Part F of title XIII (25 U.S.C. 3351 et seq.), relating 
     to American Indian postsecondary economic development 
     scholarships.
       (2) Part G of title XIII (25 U.S.C. 3371), relating to 
     American Indian teacher training.
       (3) Section 1406 (20 U.S.C. 1221e-1 note), relating to a 
     national survey of factors associated with participation.
       (4) Section 1409 (20 U.S.C. 1132a note), relating to a 
     study of environmental hazards in institutions of higher 
     education.
       (5) Section 1412 (20 U.S.C. 1101 note), relating to a 
     national job bank for teacher recruitment.
       (6) Part B of title XV (20 U.S.C. 1452 note), relating to a 
     national clearinghouse for postsecondary education materials.
       (7) Part C of title XV (20 U.S.C. 1101 note), relating to 
     school-based decisionmakers.
       (8) Part D of title XV (20 U.S.C. 1145h note), relating to 
     grants for sexual offenses education.
       (9) Part E of title XV (20 U.S.C. 1070 note), relating to 
     Olympic scholarships.
       (10) Part G of title XV (20 U.S.C. 1070a-11 note), relating 
     to advanced placement fee payment programs.
       (d) Conforming Amendments.--the Higher Education Act of 
     1965 is amended--
       (1) in section 453(c)(2)--
       (A) by striking subparagraph (E); and
       (B) by redesignating subparagraphs (F) through (H) as 
     subparagraphs (E) through (G), respectively;
       (2) in section 487(a)(3), by striking subparagraph (B) and 
     redesignating subparagraphs (C) and (D) as subparagraphs (B) 
     and (C), respectively;
       (3) in section 487(a)(15), by striking ``the Secretary of 
     Veterans Affairs, and State review entities under subpart 1 
     of part H'' and inserting ``and the Secretary of Veterans 
     Affairs'';
       (4) in section 487(a)(21), by striking ``, State 
     postsecondary review entities,'';
       (5) in section 487(c)(1)(A)(i), by striking ``State 
     agencies, and the State review entities referred to in 
     subpart 1 of part H'' and inserting ``and State agencies'';
       (6) in section 487(c)(4), by striking ``, after 
     consultation with each State review entity designated under 
     subpart 1 of part H,'';
       (7) in section 487(c)(5), by striking ``State review 
     entities designated under subpart 1 of part H,'';
       (8) in section 496(a)(7), by striking ``and the appropriate 
     State postsecondary review entity'';
       (9) in section 496(a)(8), by striking ``and the State 
     postsecondary review entity of the State in which the 
     institution of higher education is located'';
       (10) in section 498(g)(2), by striking everything after the 
     first sentence;
       (11) in section 498A(a)(2)(D), by striking ``by the 
     appropriate State postsecondary review entity designated 
     under subpart 1 of this part or'';
       (12) in section 498A(a)(2)--
       (A) by inserting ``and'' after the semicolon at the end of 
     subparagraph (E);
       (B) by striking subparagraph (F); and
       (C) by redesignating subparagraph (G) as subparagraph (F); 
     and
       (13) in section 498A(a)(3)--
       (A) by inserting ``and'' after the semicolon at the end of 
     subparagraph (C);
       (B) by striking ``; and'' at the end of subparagraph (D) 
     and inserting a period; and
       (C) by striking subparagraph (E).
     SEC. 702. ELIGIBLE INSTITUTION.

       (a) Amendments.--Section 481(b) of the Higher Education Act 
     of 1965 (20 U.S.C. 1088(b)) is amended--
       (1) by inserting before the period at the end of the first 
     sentence the following: ``on the basis of a review by the 
     institution's independent auditor using generally accepted 
     accounting principles'';
       (2) by inserting after the end of such first sentence the 
     following new sentences: ``For the purposes of clause (6), 
     revenues from sources that are not derived from funds 
     provided under this title include revenues from programs of 
     education or training that do not meet the definition of an 
     eligible program in subsection (e), but are provided on a 
     contractual basis under Federal, State, or local training 
     programs, or to business and industry. For the purposes of 
     determining whether an institution meets the requirements of 
     clause (6), the Secretary shall not consider the financial 
     information of any institution for a fiscal year began on or 
     before April 30, 1994.''.
       (b) Effective Date.--Notwithstanding section 713 of this 
     Act, the amendments made by subsection (a) shall apply to any 
     determination made on or after July 1, 1994, by the Secretary 
     of Education pursuant to section 481(b)(6) of the Higher 
     Education Act of 1965.

     SEC. 703. CARL D. PERKINS VOCATIONAL AND APPLIED TECHNOLOGY 
                   EDUCATION ACT.

       The Carl D. Perkins Vocational and Applied Technology 
     Education Act (20 U.S.C. 2301 et seq.) is repealed.

     SEC. 704. SMITH-HUGHES ACT.

       (a) Repeal.--The Smith-Hughes Act (39 Stat. 929 as amended 
     (20 U.S.C. 11-15, 16-28)) is repealed.
       (b) Effective Date.--Notwithstanding section 713 of this 
     Act, the repeal in subsection (a) of this section shall take 
     effect on October 1, 1995.

     SEC. 705. SCHOOL-TO-WORK OPPORTUNITIES ACT OF 1994.

        The School-to-Work Opportunities Act of 1994 (20 U.S.C. 
     6101 et seq.) is repealed.

     SEC. 706. SCHOOL DROPOUT ASSISTANCE ACT.

       The School Dropout Assistance Act, (part C of title V of 
     the Elementary and Secondary Education Act (20 U.S.C. 7261)) 
     is repealed.

     SEC. 707. ADULT EDUCATION ACT.

       (a) In General.--The Adult Education Act (20 U.S.C. 1201 et 
     seq.) is repealed.
       (b) Conforming Amendments.--
       (1) Esea.--The Elementary and Secondary Education Act of 
     1965 (20 U.S.C. 6301 et seq.) is amended--
       (A) in section 1202(c)(1), by striking ``the Adult 
     Education Act,'' and inserting ``title IV of the CAREERS 
     Act,'';
       (B) in section 1205(8)(B), by striking ``the Adult 
     Education Act,'' and inserting ``title IV of the CAREERS 
     Act,'';
       (C) in section 1206(a)(1)(A), by striking ``the Adult 
     Education Act;'' and inserting ``title IV of the CAREERS 
     Act;''; and
       (D) in section 9161(2), by striking ``section 312(2) of the 
     Adult Education Act.'' and inserting ``section 5 of the 
     CAREERS Act.''.
       (2) Technology for education act.--The Technology for 
     Education Act of 1994 (20 U.S.C. 6801 et seq.) is amended in 
     section 3113(1) by striking ``section 312 of the Adult 
     Education Act;'' and inserting ``section 5 of the CAREERS 
     Act;'';

     SEC. 708. NATIONAL LITERACY ACT.

       The National Literacy Act of 1991, except section 101 of 
     such Act, is repealed.

     SEC. 709. LIBRARY SERVICES AND CONSTRUCTION ACT.

       (a) In General.--The Library Services and Construction Act 
     (20 U.S.C. 351 et seq.) is repealed.
       (b) Conforming Amendment.--The Technology for Education Act 
     of 1994 (20 U.S.C. 6801 et seq.) is amended in section 
     3113(10) by striking ``section 3 of the Library Services and 
     Construction Act;'' and inserting ``section 5 of the CAREERS 
     Act;''.

     SEC. 710. TECHNOLOGY FOR EDUCATION ACT OF 1994.

       Part F of the Technology for Education Act of 1994 
     (contained in title III of the Elementary and Secondary 
     Education Act (20 U.S.C. 7001 et seq.)) is repealed.

     SEC. 711. JOB TRAINING PARTNERSHIP ACT.

       (a) In General.--The Job Training Partnership Act (29 
     U.S.C. 1501 et seq.), except section 1, sections 421 through 
     439 (relating to the Job Corps), and section 441 of such Act 
     (relating to veterans' employment programs), is hereby 
     repealed.
       (b) Conforming Amendments.--
       (1) Short title.--Section 1 of the Job Training Partnership 
     Act (29 U.S.C. 1501, note) is amended--
       (A) in the heading, by striking ``; table of contents''; 
     and
       (B) by striking all that follows after ``Job Training 
     Partnership Act''.
       (2) Job corps.--Such Act (29 U.S.C. 1501 et seq.), as 
     amended by this section, is further amended-- 

[[Page H 9032]]

       (A) by redesignating sections 421 through 439 as sections 2 
     through 21, respectively;
       (B) in section 2 (as redesignated), by striking ``part'' 
     each place it appears and inserting ``Act'';
       (C) in section 4(4) (as redesignated), by striking 
     ``sections 424 and 425'' and inserting ``sections 5 and 6'';
       (D) in section 5 (as redesignated)--
       (i) in subsection (a), by striking ``entities administering 
     programs under title II of this Act,''; and
       (ii) in subsection (b), by striking ``part'' and inserting 
     ``Act'';
       (E) in section 7 (as redesignated)--
       (i) in subsection (a), by striking ``section 428'' and 
     inserting ``section 9''; and
       (ii) by striking subsection (d);
       (F) in section 8 (as redesignated)--
       (i) by striking subsection (b); and
       (ii) by redesignating subsection (c) as subsection (b);
       (G) in section 14 (as redesignated)--
       (i) in subsection (a)(4), by striking ``part'' and 
     inserting ``Act'';
       (ii) in subsection (c)(1), by striking ``and activities 
     authorized under sections 452 and 453''; and
       (iii) in subsection (e), by striking ``section 431'' and 
     inserting ``section 12'';
       (H) in section 15 (as redesignated)--
       (i) in subsection (a)--

       (I) in the matter preceding paragraph (1), by striking 
     ``section 427'' and inserting ``section 8''; and
       (II) in paragraph (4)(A), by striking ``section 428'' and 
     inserting ``section 9'';

       (ii) in subsection (c)(3), by striking ``section 423'' and 
     inserting ``section 4'';
       (iii) in subsection (d), by striking ``sections 424 and 
     425'' and inserting ``sections 5 and 6''; and
       (iv) in subsection (e), by striking ``, pursuant to section 
     452(d),'';
       (I) in section 17 (as redesignated), by striking ``purpose 
     of this part'' each place it appears and inserting ``purpose 
     of this Act'';
       (J) in section 20 (as redesignated), by striking ``part'' 
     each place it appears and inserting ``Act''; and
       (K) in section 21 (as redesignated), by striking ``part'' 
     and inserting ``Act''.
       (3) Veterans' employment programs.--Such Act (29 U.S.C. 
     1501 et seq.), as amended by this section, is further 
     amended--
       (A) by redesignating section 441 as section 22;
       (B) by striking the heading of such section 22 (as 
     redesignated), and inserting the following:


                 ``VETERANS' EMPLOYMENT PROGRAMS''; and

       (C) in such section 22, by striking ``part'' each place it 
     appears and inserting ``section''.
       (4) Authorization of appropriations.--Such Act (29 U.S.C. 
     1501 et seq.), as amended by this section, is further amended 
     by adding at the end the following new section:


                   ``AUTHORIZATION OF APPROPRIATIONS

       ``Sec. 23. There are authorized to be appropriated such 
     sums as are necessary to carry out this Act.''.

     SEC. 712. STEWART B. MCKINNEY HOMELESS ASSISTANCE ACT.

       (a) Adult Education.--
       (1) In general.--Subtitle A of title VII of the Stewart B. 
     McKinney Homeless Assistance Act (42 U.S.C. 11421 et seq.) is 
     repealed.
       (2) Table of contents.--The table of contents of such Act 
     is amended by striking the items relating to subtitle A of 
     title VII of such Act.
       (b) Subtitle C.--
       (1) In general.--Subtitle C of title VII of the Stewart B. 
     McKinney Homeless Assistance Act (42 U.S.C. 11441 et seq.), 
     except section 738, is hereby repealed.
       (2) Table of contents.--The table of contents of such Act 
     is amended--
       (A) by striking the item relating to subtitle C of title 
     VII of such Act; and
       (B) by striking the items relating to sections 731 through 
     737 and sections 739 through 741.

     SEC. 713. EFFECTIVE DATE.

       The repeals and amendments made by this Act shall take 
     effect on July 1, 1997, except for amendments to the 
     Rehabilitation Act of 1973.
                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 1: Strike sections 102 and 103.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 2: Strike ``August 1, 1997'' each time it 
     appears in sections 102 and 103 and insert in lieu thereof 
     ``November 12, 1996''.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 3: Strike section 348 and renumber the 
     subsequent sections accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 4: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``65 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause(2)''. 
     Conform the table of contents of the bill accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 5: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``75 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''. Conform the table of contents of the bill accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 6: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``85 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''. Conform the table of contents of the bill accordingly.
                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 7: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``96 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''. Conform the table of contents of the bill accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 8: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``105 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''. Conform the table of contents of the bill accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 9: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``115 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''. Conform the table of contents of the bill accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 10: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``125 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''. Conform the table of contents of the bill accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 11: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``135 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''. Conform the table of contents of the bill accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 12: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``145 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''. Conform the table of contents of the bill accordingly.
                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 13: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``155 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''.

[[Page H 9033]]

       Conform the table of contents of the bill accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 14: Strike section 348 and insert in lieu 
     thereof the following:

     SEC. 348. NATIONAL MAXIMUM SPEED LIMIT.

       Section 154(a) of title 23, United States Code, is 
     amended--
       (1) by striking ``fifty-five miles'' the first place it 
     appears and all that follows through ``or (4)'' and inserting 
     ``165 miles per hour, or (2)''; and
       (2) by striking ``Clause (4)'' and inserting ``Clause 
     (2)''.
       Conform the table of contents of the bill accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 15: Strike section 351 and renumber the 
     subsequent sections accordingly.

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 16: Strike section 351(a)(5).

                               H.R. 2274

                         Offered By: Mr. Rahall

       Amendment No. 17: In section 351(c) strike ``the safety of 
     commercial motor vehicles'' each time it appears and insert 
     in lieu thereof ``, either the safety of commercial motor 
     vehicles, their operators or the public''.