[Congressional Record Volume 144, Number 45 (Wednesday, April 22, 1998)]
[Senate]
[Pages S3445-S3456]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




                          AMENDMENTS SUBMITTED

                                 ______
                                 

        THE EDUCATION SAVINGS ACT FOR PUBLIC AND PRIVATE SCHOOLS

                                 ______
                                 

                 GORTON (AND OTHERS) AMENDMENT NO. 2293

  Mr. GORTON (for himself, Mr. Frist, Mr. Hagel, Mr. Mack, Mr. 
Coverdell, Mr. Helms, Mr. Smith of New Hampshire, Mr. Nickles, Mr. 
Ashcroft, Mr. Domenici, Mr. Gregg, and Mr. McConnell) proposed an 
amendment to the bill (H.R. 2646) to amend the Internal Revenue Code of 
1986 to allow tax-free expenditures from education individual 
retirement accounts for elementary and secondary school expenses, to 
increase the maximum annual amount of contributions to such accounts, 
and for other purposes; as follows:

       At the end, add the following:
                     TITLE ____--EDUCATION FUNDING

     SEC. ____01. DIRECT AWARDS OF CERTAIN EDUCATION FUNDING.

       (a) State Options.--
       (1) In general.--Notwithstanding any other provision of law 
     and subject to subsection (b)(2), each State shall notify the 
     Secretary regarding the State's election to receive the 
     State's portion of the applicable funding described in 
     subsection (e) according to one of the following options:
       (A) State block grant option.--The State may receive the 
     funding pursuant to a State allotment described in subsection 
     (c)(1)(A).
       (B) Local block grant option.--The State may direct the 
     Secretary to send the funding directly to local educational 
     agencies in the State pursuant to a local allotment described 
     in subsection (c)(1)(B).
       (C) Federal statute option.--The State may receive the 
     funding according to the provisions of law described in 
     subsection (e).
       (2) Option requirements.--
       (A) In general.--A State shall select an option described 
     in paragraph (1)--
       (i) within 1 year of the date of enactment of this Act;
       (ii) pursuant to a majority vote of the State legislature; 
     and
       (iii) with the concurrence of the Governor.
       (B) Failure to select an option.--If a State fails to 
     select an option in accordance with this subsection, the 
     Secretary shall award the applicable funding pursuant to 
     paragraph (1)(B).
       (C) Changes.--A State may alter the selection made under 
     paragraph (1) only once and only after receiving the 
     applicable funding for 3 years pursuant to 1 of the options 
     described in such paragraph.
       (3) Minimum.--No State shall receive an amount under this 
     section for a fiscal year that is less than 0.5 percent of 
     the applicable funding available for the fiscal year.
       (4) Definitions.--In this section--
       (A) the term ``State'' means each of the several States of 
     the United States, the District of Columbia, and the 
     Commonwealth of Puerto Rico; and
       (B) the term ``outlying area'' means Guam, American Samoa, 
     the Commonwealth of the Northern Mariana Islands, the United 
     States Virgin Islands, the Republic of the Marshall Islands, 
     the Federated States of Micronesia, and the Republic of 
     Palau.
       (b) Reservation and Applicability.--
       (1) Reservation.--From the total amount of applicable 
     funding available for a fiscal year, the Secretary shall 
     reserve 1 percent to make awards to the Bureau of Indian 
     Affairs and the outlying areas according to their respective 
     needs for assistance under this section.
       (2) Applicability.--The provisions of this section shall 
     not apply--
       (A) for fiscal year 1999, if the total amount appropriated 
     to carry out the provisions of law described in subsection 
     (e) for the fiscal year is less than $2,564,000,000;
       (B) for fiscal year 2000, if the total amount so 
     appropriated for the fiscal year is less than $2,625,000,000;
       (C) for fiscal year 2001, if the total amount so 
     appropriated for the fiscal year is less than $2,687,000,000;
       (D) for fiscal year 2002, if the total amount so 
     appropriated for the fiscal year is less than $2,750,000,000; 
     and
       (E) for fiscal year 2003, if the total amount so 
     appropriated for the fiscal year is less than $2,817,000,000.
       (c) Block Grants.--
       (1) Allotments.--
       (A) States.--From the total applicable funding available 
     for a fiscal year, and not reserved under subsection (b)(1) 
     for the fiscal year, the Secretary may make allotments to

[[Page S3446]]

     each State selecting the option described in subsection 
     (a)(1)(A) in an amount that bears the same relation--
       (i) to 50 percent of such total applicable funding as the 
     number of individuals in the State who are aged 5 through 17 
     bears to the total number of such individuals in all States; 
     and
       (ii) to 50 percent of such total applicable funding as the 
     total amount all local educational agencies in the State are 
     eligible to receive under part A of title I of the Elementary 
     and Secondary Education Act of 1965 for the fiscal year bears 
     to the total amount all local educational agencies in all 
     States are eligible to receive under such part for the fiscal 
     year.
       (B) Local educational agencies.--From the total applicable 
     funding available for a fiscal year, and not reserved under 
     subsection (b)(1) for the fiscal year, the Secretary may make 
     allotments to each local educational agency in a State 
     selecting the option described in subsection (a)(1)(B) in an 
     amount that bears the same relation--
       (i) to 50 percent of such total applicable funding as the 
     number of individuals in the school district served by the 
     local educational agency who are aged 5 through 17 bears to 
     the total number of such individuals in all school districts 
     served by all local educational agencies in all States; and
       (ii) to 50 percent of such total amount as the total amount 
     all local educational agencies in the State are eligible to 
     receive under part A of title I of the Elementary and 
     Secondary Education Act of 1965 for the fiscal year bears to 
     the total amount all local educational agencies in all States 
     are eligible to receive under such part for the fiscal year.
       (2) Use of allotted funds.--
       (A) In general.--A State or local educational agency 
     receiving an allotment under paragraph (1) shall use the 
     allotted funds for innovative assistance programs described 
     in subparagraph (B).
       (B) Innovative assistance.--The innovative assistance 
     programs referred to in subparagraph (A) include--
       (i) technology programs related to the implementation of 
     school-based reform programs, including professional 
     development to assist teachers and other school officials 
     regarding how to use effectively such equipment and software;
       (ii) programs for the acquisition and use of instructional 
     and educational materials, including library services and 
     materials (including media materials), assessments, reference 
     materials, computer software and hardware for instructional 
     use, and other curricular materials that--

       (I) are tied to high academic standards;
       (II) will be used to improve student achievement; and
       (III) are part of an overall education reform program;

       (iii) promising education reform programs, including 
     effective schools and magnet schools;
       (iv) programs to improve the higher order thinking skills 
     of disadvantaged elementary school and secondary school 
     students and to prevent students from dropping out of school;
       (v) programs to combat illiteracy in the student and adult 
     populations, including parent illiteracy;
       (vi) programs to provide for the educational needs of 
     gifted and talented children;
       (vii) hiring of teachers or teaching assistants to decrease 
     a school, school district, or statewide student-to-teacher 
     ratio; and
       (viii) school improvement programs or activities described 
     in sections 1116 and 1117 of the Elementary and Secondary 
     Education Act of 1965.
       (3) State funding rule.--
       (A) Administrative expenses and statewide activities.--A 
     State that receives an allotment under paragraph (1)(A) for a 
     fiscal year may use not more than 5 percent of the allotted 
     funds for the fiscal year for administrative expenses or 
     statewide activities.
       (B) State funding rules.--A State that receives an 
     allotment under paragraph (1)(A)--
       (i) may, at the State's discretion, place limits on the use 
     of the allotted funds; and
       (ii) may allocate the allotted funds to public and private 
     entities within the State as the State determines 
     appropriate.
       (4) Hold harmless requirements.--
       (A) States.--Notwithstanding any other provision of this 
     section, no State that selects the option described in 
     subsection (a)(1)(A) for a fiscal year shall receive an 
     amount under this section for the fiscal year that is less 
     than the amount the State is, or all local educational 
     agencies in the State are, eligible to receive pursuant to 
     the provisions of law described in subsection (e) for the 
     fiscal year.
       (B) Local educational agencies.--Notwithstanding any other 
     provision of this section, no local educational agency for 
     which the option described in subsection (a)(1)(B) is 
     applicable for a fiscal year shall receive an amount under 
     this section for the fiscal year that is less than the amount 
     the local educational agency is eligible to receive pursuant 
     to the provisions of law described in subsection (e) for the 
     fiscal year.
       (d) Federal Statute Option.--
       (1) In general.--From the applicable funding that remains 
     after making the reservation under subsection (b)(1) and 
     allotments under subsection (c) for a fiscal year, the 
     Secretary may make awards according to the provisions of law 
     described in subsection (e), to State and local recipients, 
     in States making the election described in subsection 
     (a)(1)(C).
       (2) Percentage reductions.--The Secretary, after making the 
     allotments under subsection (c) for a fiscal year, shall 
     reduce the total amount of applicable funding available to 
     carry out the provisions of law described in subsection (e) 
     for the fiscal year, for any State selecting the option 
     described in subsection (a)(1)(C), by an equal percentage for 
     each such provision.
       (e) Applicable Funding.--
       (1) Definition.--In this section, the term ``applicable 
     funding'' means all funds not used to carry out paragraph (2) 
     for a fiscal year that are appropriated for the Department of 
     Education for the fiscal year to carry out programs or 
     activities under the following provisions of law:
       (A) Title III of the Goals 2000: Educate America Act (20 
     U.S.C. 5881 et seq.).
       (B) Title IV of the Goals 2000: Educate America Act (20 
     U.S.C. 5911 et seq.).
       (C) Title VI of the Goals 2000: Educate America Act (20 
     U.S.C. 5951).
       (D) Titles II, III, and IV of the School-to-Work 
     Opportunities Act of 1994 (20 U.S.C. 6121 et seq., 6171 et 
     seq., and 6191 et seq.).
       (E) Part A of title II of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6621 et seq.).
       (F) Section 3122 of the Elementary and Secondary Education 
     Act of 1965 (20 U.S.C. 6832).
       (G) Sections 3132 and 3136 of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6842 and 6846).
       (H) Section 3141 of the Elementary and Secondary Education 
     Act of 1965 (20 U.S.C. 6861).
       (I) Part B of title III of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6891 et seq.).
       (J) Part C of title III of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6921 et seq.).
       (K) Part D of title III of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6951 et seq.).
       (L) Subpart 1 of part A of title IV of the Elementary and 
     Secondary Education Act of 1965 (20 U.S.C. 7111 et seq.).
       (M) Subpart 2 of part A of title IV of the Elementary and 
     Secondary Education Act of 1965 (20 U.S.C. 7131 et seq.).
       (N) Part A of title V of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 7201 et seq.).
       (O) Title VI of the Elementary and Secondary Education Act 
     of 1965 (20 U.S.C. 311 et seq.).
       (P) Part A of title X of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8001 et seq.).
       (Q) Part B of title X of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8031 et seq.).
       (R) Part G of title X of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8161 et seq.).
       (S) Part I of title X of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8241 et seq.).
       (T) Part A of title XIII of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8621 et seq.).
       (U) Part C of title XIII of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8671 et seq.).
       (2) Multiyear awards.--The Secretary shall use funds 
     appropriated to carry out the provisions of law described in 
     paragraph (1) (other than subparagraphs (A), (B), and (O) of 
     paragraph (1)) for each fiscal year to make payments to 
     eligible recipients under such provisions pursuant to any 
     multiyear award made under such provisions prior to the date 
     of enactment of this Act. The payments shall be made for the 
     duration of the multiyear award.
       (f) Census Determination.--
       (1) In general.--Each local educational agency shall 
     conduct a census to determine the number of kindergarten 
     through grade 12 students that are in the school district 
     served by the local educational agency for an academic year.
       (2) Private school students.--In carrying out paragraph 
     (1), each local educational agency shall determine the number 
     of private school students described in such paragraph for an 
     academic year on the basis of data the agency determines 
     reliable.
       (3) Submission.--Each local educational agency shall submit 
     the total number of public and private school children 
     described in this paragraph for an academic year to the 
     Secretary not later than February 1 of the academic year.
       (4) Penalty.--If the Secretary determines that a local 
     educational agency has knowingly submitted false information 
     under this subsection for the purpose of gaining additional 
     funds under this section, then the local educational agency 
     shall be fined an amount equal to twice the difference 
     between the amount the local educational agency received 
     under this section, and the correct amount the local 
     educational agency would have received if the agency had 
     submitted accurate information under this subsection.

     SEC. ____02. DIRECT AWARDS OF PART A OF TITLE I FUNDING.

       (a) Direct Awards.--
       (1) In general.--Notwithstanding any other provision of law 
     and subject to subsection (c), the Secretary shall award the 
     total amount of funds appropriated to carry out part A of 
     title I of the Elementary and Secondary Education Act of 1965 
     (20 U.S.C.

[[Page S3447]]

     6311 et seq.) for a fiscal year directly to local educational 
     agencies in accordance with paragraph (2) to enable the local 
     educational agencies to support programs or activities, for 
     kindergarten through grade 12 students, that the local 
     educational agencies deem appropriate.
       (2) Eligible local educational agencies.--The Secretary 
     shall make awards under this section for a fiscal year only 
     to local educational agencies that are eligible for 
     assistance under part A of title I of the Elementary and 
     Secondary Education Act of 1965 for the fiscal year.
       (b) Amount.--Each local educational agency shall receive an 
     amount awarded under this subsection for a fiscal year equal 
     to the amount the local educational agency is eligible to 
     receive under part A of title I of the Elementary and 
     Secondary Education Act of 1965 for the fiscal year.
       (c) Applicability.--The provisions of this section shall 
     not apply--
       (1) for fiscal year 1999, if the total amount appropriated 
     to carry out part A of title I of the Elementary and 
     Secondary Education Act of 1965 for the fiscal year is less 
     than $7,694,000,000;
       (2) for fiscal year 2000, if the total amount so 
     appropriated for the fiscal year is less than $7,875,000,000;
       (3) for fiscal year 2001, if the total amount so 
     appropriated for the fiscal year is less than $8,064,000,000;
       (4) for fiscal year 2002, if the total amount so 
     appropriated for the fiscal year is less than $8,251,000,000; 
     and
       (5) for fiscal year 2003, if the total amount so 
     appropriated for the fiscal year is less than $8,426,000,000.
       (d) Requirements.--
       (1) Eligible school attendance areas.--A local educational 
     agency shall use funds received under this section only in 
     eligible school attendance areas determined in accordance 
     with section 1113 of the Elementary and Secondary Education 
     Act of 1965 other than subsection (c) of such section.
       (2) Eligible pupils.--A local educational agency shall use 
     funds received under this section--
       (A) in the case of a school that meets the criteria 
     described in section 1114(a)(1), to serve all pupils in the 
     school; and
       (B) in the case of a school that does not meet such 
     criteria, to serve the children attending the school who are 
     eligible children described in section 1115(b).

     SEC. ____03. DIRECT AWARDS OF BILINGUAL EDUCATION FUNDING.

       (a) State Options.--
       (1) In general.--Notwithstanding any other provision of law 
     and subject to subsection (b)(2), each State shall notify the 
     Secretary regarding the State's election to receive the 
     State's portion of the finds appropriated to carry out parts 
     A, B, and C of title VII of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 7401 et seq., 7511 et seq., 
     and 7541 et seq.) according to one of the following options:
       (A) State block grant option.--The State may receive the 
     funding pursuant to a State allotment described in subsection 
     (c)(1)(A).
       (B) Local block grant option.--The State may direct the 
     Secretary to send the funding directly to local educational 
     agencies in the State that serve the recipients in the State 
     under parts A, B, and C pursuant to a local allotment 
     described in subsection (c)(1)(B).
       (C) Federal statute option.--The State may receive the 
     funding according to the provisions of law described in 
     subsection (e).
       (2) Option requirements.--
       (A) In general.--A State shall select an option described 
     in paragraph (1)--
       (i) within 1 year of the date of enactment of this Act;
       (ii) pursuant to a majority vote of the State legislature; 
     and
       (iii) with the concurrence of the Governor.
       (B) Failure to select an option.--If a State fails to 
     select an option in accordance with this subsection, the 
     Secretary shall award the funding pursuant to paragraph 
     (1)(B).
       (C) Changes.--A State may alter the selection made under 
     paragraph (1) only once and only after receiving the funding 
     for 3 years pursuant to 1 of the options described in such 
     paragraph.
       (3) Multiyear awards.--The Secretary shall use funds 
     appropriated to carry out parts A, B, and C of title VII of 
     the Elementary and Secondary Education Act of 1965 for each 
     fiscal year to make payments to eligible recipients under 
     such parts pursuant to any multiyear award under such parts 
     made prior to the date of enactment of this Act. The payments 
     shall be made for the duration of the multiyear award.
       (4) Definitions.--In this section--
       (A) the term ``State'' means each of the several States of 
     the United States and the District of Columbia; and
       (B) the term ``outlying area'' means the Commonwealth of 
     Puerto Rico, Guam, American Samoa, the Commonwealth of the 
     Northern Mariana Islands, the United States Virgin Islands, 
     the Republic of the Marshall Islands, the Federated States of 
     Micronesia, and the Republic of Palau.
       (b) Reservation and Applicability.--
       (1) Reservation.--From the total amount of funds 
     appropriated to carry out parts A, B, and C of title VII of 
     the Elementary and Secondary Education Act of 1965 for a 
     fiscal year that are not used to carry out subsection (a)(3) 
     for the fiscal year, the Secretary shall reserve 1 percent to 
     make awards to the Bureau of Indian Affairs and the outlying 
     areas according to their respective needs for assistance 
     under this section.
       (2) Applicability.--The provisions of this section shall 
     not apply--
       (A) for fiscal year 1999, if the total amount appropriated 
     to carry out parts A, B, and C of title VII of the Elementary 
     and Secondary Education Act of 1965 for the fiscal year is 
     less than $362,000,000;
       (B) for fiscal year 2000, if the total amount so 
     appropriated for the fiscal year is less than $370,000,000;
       (C) for fiscal year 2001, if the total amount so 
     appropriated for the fiscal year is less than $379,000,000;
       (D) for fiscal year 2002, if the total amount so 
     appropriated for the fiscal year is less than $388,000,000; 
     and
       (E) for fiscal year 2003, if the total amount so 
     appropriated for the fiscal year is less than $398,000,000.
       (c) Block Grants.--
       (1) Allotments.--
       (A) States.--From the total amount of funds appropriated to 
     carry out parts A, B, and C of title VII of the Elementary 
     and Secondary Education Act of 1965 for a fiscal year that 
     are not used to carry out subsection (a)(3) for the fiscal 
     year, and are not reserved under subsection (b)(1) for the 
     fiscal year, the Secretary may make allotments to each State 
     selecting the option described in subsection (a)(1)(A) in an 
     amount that bears the same relation to such total amount of 
     funds as the amount all entities in the State received under 
     such parts for fiscal year 1998 bears to the total amount all 
     entities in all States received under such parts for fiscal 
     year 1998.
       (B) Local educational agencies.--From the total amount of 
     funds appropriated to carry out parts A, B, and C of title 
     VII of the Elementary and Secondary Education Act of 1965 for 
     a fiscal year that are not used to carry out subsection 
     (a)(3) for the fiscal year, and are not reserved under 
     subsection (b)(1) for the fiscal year, the Secretary may make 
     allotments to each local educational agency in a State 
     selecting the option described in subsection (a)(1)(B) in an 
     amount that bears the same relation to such total amount of 
     funds as the amount all recipients in the area served by the 
     local educational agency received under such parts for fiscal 
     year 1998 bears to the total amount all recipients in all 
     areas served by all local educational agencies received under 
     such parts for fiscal year 1998.
       (2) Use of allotted funds.--Funds awarded under this 
     section shall be used to pay for enhanced instructional 
     opportunities for limited English proficient children and 
     youth, that may include--
       (A) family literacy, parent outreach, and training 
     activities designed to assist parents to become active 
     participants in the education of their children;
       (B) salaries of personnel, including teacher aids, who have 
     been specifically trained, or are being trained, to provide 
     services to limited English proficient children and youth;
       (C) tutorials, mentoring, and academic or career counseling 
     for limited English proficient children and youth;
       (D) identification and acquisition of curricular materials, 
     educational software, and technologies to be used;
       (E) basic instructional services that are directly 
     attributable to the presence of limited English proficient 
     children, including the costs of providing additional 
     classroom supplies, overhead costs, costs of construction, 
     acquisition or rental of space, costs of transportation, or 
     such other costs as are directly attributable to such 
     additional basic instructional services; and
       (F) such other activities, related to innovative programs 
     described in subparagraphs (A) through (E), as the Secretary 
     may authorize.
       (3) State funding rule.--
       (A) Administrative expenses and statewide activities.--A 
     State that receives an allotment under paragraph (1)(A) for a 
     fiscal year may use not more than 5 percent of the allotted 
     funds for the fiscal year for administrative expenses or 
     statewide activities.
       (B) State funding rules.--A State that receives an 
     allotment under paragraph (1)(A)--
       (i) may, at the State's discretion, place limits on the use 
     of the allotted funds; and
       (ii) subject to subsection (f), may allocate the allotted 
     funds to public and private entities within the State as the 
     State determines appropriate.
       (d) Federal Statute Option.--
       (1) In general.--From the total amount of funds 
     appropriated to carry out parts A, B, and C of the Elementary 
     and Secondary Education Act of 1965 for a fiscal year that 
     remain after carrying out subsection (a)(3) for the fiscal 
     year, making the reservation under subsection (b) for the 
     fiscal year, and making allotments under subsection (c) for 
     the fiscal year, the Secretary may make awards according to 
     the provisions of such parts A, B, and C, respectively, to 
     State and local recipients, in States making the election 
     described in subsection (a)(1)(C).
       (2) Percentage reductions.--The Secretary, after making the 
     allotments under subsection (c) for a fiscal year, shall 
     reduce the total amount of funding available to carry out 
     such parts A, B, and C for the fiscal year, for any State 
     selecting the option described in subsection (a)(1)(C), by an 
     equal percentage for each such part.
       (e) Construction.--Nothing in this section shall be 
     construed--
       (1) to prohibit a local educational agency from serving 
     limited English proficient children simultaneously with 
     students with

[[Page S3448]]

     similar educational needs, in the same educational settings 
     where appropriate; and
       (2) to mandate a particular type of curriculum or 
     educational method for limited English proficient children 
     and youth, which decisions--
       (A) shall be the sole responsibility of the State 
     educational agency, local educational agency, or other State 
     or local recipients; and
       (B) shall be made in accordance with applicable State law.

     SEC. ____04. PARTICIPATION OF CHILDREN ENROLLED IN PRIVATE 
                   SCHOOLS.

       (a) In General.--Each local educational agency that 
     receives assistance under sections ____01 or ____03 shall 
     provide for the participation of children enrolled in private 
     schools in the activities and services assisted under 
     sections ____01 or ____03, respectively, in the same manner 
     as the children participate in activities and services under 
     the Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     6301 et seq.) pursuant to sections 14503, 14504, 14505, and 
     14506 of such Act (20 U.S.C. 8893, 8894, 8895, and 8896).
       (b) Part A of Title I Funding.--Each local educational 
     agency that receives assistance under section ____02 shall 
     provide for the participation of children enrolled in private 
     schools in the activities and services assisted under section 
     ____02 in the same manner as the children participate in 
     activities and services under the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6301 et seq.) pursuant to 
     section 1120 such Act (20 U.S.C. 6321).

     SEC. ____05. ACCOUNTABILITY.

       (a) Standard Application and Reporting Forms.--The 
     Secretary shall develop standard forms for applications for 
     assistance under this title and for reporting with respect to 
     activities assisted under this title. In developing the 
     forms, the Secretary shall ensure that not more than 2 
     percent of the assistance provided to an entity under this 
     title is used to complete the forms.
       (b) Public Input.--Each entity receiving assistance under 
     this title shall--
       (1) involve parents and members of the public in planning 
     for the use of funds provided under this title; and
       (2) disseminate to the public reports regarding the use and 
     effects of funds provided under this title.

     SEC. ____06. DEFINITIONS.

       In this title--
       (1) the term ``local educational agency'' has the meaning 
     given the term in section 14101 of the Elementary and 
     Secondary Education Act of 1965 (20 U.S.C. 8801); and
       (2) the term ``Secretary'' means the Secretary of 
     Education.

     SEC. ____07. CONSTRUCTION.

       Nothing in this title shall be construed to supersede the 
     authority of a State or State educational agency over State 
     education policies.
                                 ______
                                 

                        FRIST AMENDMENT NO. 2294

  Mr. FRIST proposed an amendment to amendment No. 2293 proposed by Mr. 
Gorton to the bill, H.R. 2646, supra; as follows:

       In lieu of the matter proposed to be inserted, insert the 
     following:
                     TITLE ____--EDUCATION FUNDING

     SEC. ____01. DIRECT AWARDS OF CERTAIN EDUCATION FUNDING.

       (a) State Options.--
       (1) In general.--Notwithstanding any other provision of law 
     and subject to subsection (b)(2), each State shall notify the 
     Secretary regarding the State's election to receive the 
     State's portion of the applicable funding described in 
     subsection (e) according to one of the following options:
       (A) State block grant option.--The State may receive the 
     funding pursuant to a State allotment described in subsection 
     (c)(1)(A).
       (B) Local block grant option.--The State may direct the 
     Secretary to send the funding directly to local educational 
     agencies in the State pursuant to a local allotment described 
     in subsection (c)(1)(B).
       (C) Federal statute option.--The State may receive the 
     funding according to the provisions of law described in 
     subsection (e).
       (2) Option requirements.--
       (A) In general.--A State shall select an option described 
     in paragraph (1)--
       (i) within 1 year of the date of enactment of this Act;
       (ii) pursuant to a majority vote of the State legislature; 
     and
       (iii) with the concurrence of the Governor.
       (B) Failure to select an option.--
       (i) In general.--If a State legislature meets within 1 year 
     of the date of enactment of this Act and fails to select an 
     option in accordance with this subsection, the Secretary 
     shall award the applicable funding pursuant to paragraph 
     (1)(B).
       (ii) Legislature which does not meet.--If a State does not 
     select an option described in paragraph (1) in accordance 
     with this subsection because the State legislature does not 
     meet within 1 year of the date of enactment of this Act, the 
     State may select, at the first meeting of the State 
     legislature after such date, any such option in accordance 
     with this subsection, which option shall take effect for the 
     fiscal year that begins after such meeting.
       (C) Changes.--
       (i) Block grant options.--If a State selects the option 
     described in subparagraph (A) or (B) of paragraph (1), the 
     State may alter the selection made under paragraph (1) only 
     once and only after receiving the applicable funding for 3 
     years pursuant to the option described in such subparagraph.
       (ii) Federal statute option.--Subject to clause (i), if a 
     State selects the option described in paragraph (1)(C) for a 
     fiscal year, the State may select the option described in 
     subparagraph (A) or (B) of paragraph (1) for the succeeding 
     fiscal year.
       (3) Minimum.--No State shall receive an amount under this 
     section for a fiscal year that is less than 0.5 percent of 
     the applicable funding available for the fiscal year.
       (4) Definitions.--In this section--
       (A) the term ``State'' means each of the several States of 
     the United States, the District of Columbia, and the 
     Commonwealth of Puerto Rico; and
       (B) the term ``outlying area'' means Guam, American Samoa, 
     the Commonwealth of the Northern Mariana Islands, the United 
     States Virgin Islands, the Republic of the Marshall Islands, 
     the Federated States of Micronesia, and the Republic of 
     Palau.
       (b) Reservation and Applicability.--
       (1) Reservation.--From the total amount of applicable 
     funding available for a fiscal year, the Secretary shall 
     reserve 1 percent to make awards to the Bureau of Indian 
     Affairs and the outlying areas according to their respective 
     needs for assistance under this section.
       (2) Applicability.--The provisions of this section shall 
     not apply--
       (A) for fiscal year 1999, if the total amount appropriated 
     to carry out the provisions of law described in subsection 
     (e) for the fiscal year is less than $2,564,000,000;
       (B) for fiscal year 2000, if the total amount so 
     appropriated for the fiscal year is less than $2,625,000,000;
       (C) for fiscal year 2001, if the total amount so 
     appropriated for the fiscal year is less than $2,687,000,000;
       (D) for fiscal year 2002, if the total amount so 
     appropriated for the fiscal year is less than $2,750,000,000; 
     and
       (E) for fiscal year 2003, if the total amount so 
     appropriated for the fiscal year is less than $2,817,000,000.
       (c) Block Grants.--
       (1) Allotments.--
       (A) States.--From the total applicable funding available 
     for a fiscal year, and not reserved under subsection (b)(1) 
     for the fiscal year, the Secretary may make allotments to 
     each State selecting the option described in subsection 
     (a)(1)(A) in an amount that bears the same relation--
       (i) to 50 percent of such total applicable funding as the 
     number of individuals in the State who are aged 5 through 17 
     bears to the total number of such individuals in all States; 
     and
       (ii) to 50 percent of such total applicable funding as the 
     total amount all local educational agencies in the State are 
     eligible to receive under part A of title I of the Elementary 
     and Secondary Education Act of 1965 for the fiscal year bears 
     to the total amount all local educational agencies in all 
     States are eligible to receive under such part for the fiscal 
     year.
       (B) Local educational agencies.--From the total applicable 
     funding available for a fiscal year, and not reserved under 
     subsection (b)(1) for the fiscal year, the Secretary may make 
     allotments to each local educational agency in a State 
     selecting the option described in subsection (a)(1)(B) in an 
     amount that bears the same relation--
       (i) to 50 percent of such total applicable funding as the 
     number of individuals in the school district served by the 
     local educational agency who are aged 5 through 17 bears to 
     the total number of such individuals in all school districts 
     served by all local educational agencies in all States; and
       (ii) to 50 percent of such total amount as the total amount 
     all local educational agencies in the State are eligible to 
     receive under part A of title I of the Elementary and 
     Secondary Education Act of 1965 for the fiscal year bears to 
     the total amount all local educational agencies in all States 
     are eligible to receive under such part for the fiscal year.
       (2) Use of allotted funds.--
       (A) In general.--A State or local educational agency 
     receiving an allotment under paragraph (1) shall use the 
     allotted funds for innovative assistance programs described 
     in subparagraph (B).
       (B) Innovative assistance.--The innovative assistance 
     programs referred to in subparagraph (A) include--
       (i) technology programs related to the implementation of 
     school-based reform programs, including professional 
     development to assist teachers and other school officials 
     regarding how to use effectively such equipment and software;
       (ii) programs for the acquisition and use of instructional 
     and educational materials, including library services and 
     materials (including media materials), assessments, reference 
     materials, computer software and hardware for instructional 
     use, and other curricular materials that--

       (I) are tied to high academic standards;
       (II) will be used to improve student achievement; and
       (III) are part of an overall education reform program;

       (iii) promising education reform programs, including 
     effective schools and magnet schools;
       (iv) programs to improve the higher order thinking skills 
     of disadvantaged elementary school and secondary school 
     students and to prevent students from dropping out of school;

[[Page S3449]]

       (v) programs to combat illiteracy in the student and adult 
     populations, including parent illiteracy;
       (vi) programs to provide for the educational needs of 
     gifted and talented children;
       (vii) hiring of teachers or teaching assistants to decrease 
     a school, school district, or statewide student-to-teacher 
     ratio; and
       (viii) school improvement programs or activities described 
     in sections 1116 and 1117 of the Elementary and Secondary 
     Education Act of 1965.
       (3) State funding rule.--
       (A) Administrative expenses and statewide activities.--A 
     State that receives an allotment under paragraph (1)(A) for a 
     fiscal year may use not more than 5 percent of the allotted 
     funds for the fiscal year for administrative expenses or 
     statewide activities.
       (B) State funding rules.--A State that receives an 
     allotment under paragraph (1)(A)--
       (i) may, at the State's discretion, place limits on the use 
     of the allotted funds; and
       (ii) may allocate the allotted funds to public and private 
     entities within the State as the State determines 
     appropriate.
       (4) Hold harmless requirements.--
       (A) States.--Notwithstanding any other provision of this 
     section, no State that selects the option described in 
     subsection (a)(1)(A) for a fiscal year shall receive an 
     amount under this section for the fiscal year that is less 
     than the amount the State is, or all local educational 
     agencies in the State are, eligible to receive pursuant to 
     the provisions of law described in subsection (e) for the 
     fiscal year.
       (B) Local educational agencies.--Notwithstanding any other 
     provision of this section, no local educational agency for 
     which the option described in subsection (a)(1)(B) is 
     applicable for a fiscal year shall receive an amount under 
     this section for the fiscal year that is less than the amount 
     the local educational agency is eligible to receive pursuant 
     to the provisions of law described in subsection (e) for the 
     fiscal year.
       (d) Federal Statute Option.--
       (1) In general.--From the applicable funding that remains 
     after making the reservation under subsection (b)(1) and 
     allotments under subsection (c) for a fiscal year, the 
     Secretary may make awards according to the provisions of law 
     described in subsection (e), to State and local recipients, 
     in States making the election described in subsection 
     (a)(1)(C).
       (2) Percentage reductions.--The Secretary, after making the 
     allotments under subsection (c) for a fiscal year, shall 
     reduce the total amount of applicable funding available to 
     carry out the provisions of law described in subsection (e) 
     for the fiscal year, for any State selecting the option 
     described in subsection (a)(1)(C), by an equal percentage for 
     each such provision.
       (e) Applicable Funding.--
       (1) Definition.--In this section, the term ``applicable 
     funding'' means all funds not used to carry out paragraph (2) 
     for a fiscal year that are appropriated for the Department of 
     Education for the fiscal year to carry out programs or 
     activities under the following provisions of law:
       (A) Title III of the Goals 2000: Educate America Act (20 
     U.S.C. 5881 et seq.).
       (B) Title IV of the Goals 2000: Educate America Act (20 
     U.S.C. 5911 et seq.).
       (C) Title VI of the Goals 2000: Educate America Act (20 
     U.S.C. 5951).
       (D) Titles II, III, and IV of the School-to-Work 
     Opportunities Act of 1994 (20 U.S.C. 6121 et seq., 6171 et 
     seq., and 6191 et seq.).
       (E) Part A of title II of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6621 et seq.).
       (F) Section 3122 of the Elementary and Secondary Education 
     Act of 1965 (20 U.S.C. 6832).
       (G) Sections 3132 and 3136 of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6842 and 6846).
       (H) Section 3141 of the Elementary and Secondary Education 
     Act of 1965 (20 U.S.C. 6861).
       (I) Part B of title III of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6891 et seq.).
       (J) Part C of title III of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6921 et seq.).
       (K) Part D of title III of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6951 et seq.).
       (L) Subpart 1 of part A of title IV of the Elementary and 
     Secondary Education Act of 1965 (20 U.S.C. 7111 et seq.).
       (M) Subpart 2 of part A of title IV of the Elementary and 
     Secondary Education Act of 1965 (20 U.S.C. 7131 et seq.).
       (N) Part A of title V of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 7201 et seq.).
       (O) Title VI of the Elementary and Secondary Education Act 
     of 1965 (20 U.S.C. 311 et seq.).
       (P) Part A of title X of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8001 et seq.).
       (Q) Part B of title X of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8031 et seq.).
       (R) Part G of title X of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8161 et seq.).
       (S) Part I of title X of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8241 et seq.).
       (T) Part A of title XIII of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8621 et seq.).
       (U) Part C of title XIII of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 8671 et seq.).
       (2) Multiyear awards.--The Secretary shall use funds 
     appropriated to carry out the provisions of law described in 
     paragraph (1) (other than subparagraphs (A), (B), and (O) of 
     paragraph (1)) for each fiscal year to make payments to 
     eligible recipients under such provisions pursuant to any 
     multiyear award made under such provisions prior to the date 
     of enactment of this Act. The payments shall be made for the 
     duration of the multiyear award.
       (f) Census Determination.--
       (1) In general.--Each local educational agency shall 
     conduct a census to determine the number of kindergarten 
     through grade 12 students that are in the school district 
     served by the local educational agency for an academic year.
       (2) Private school students.--In carrying out paragraph 
     (1), each local educational agency shall determine the number 
     of private school students described in such paragraph for an 
     academic year on the basis of data the agency determines 
     reliable.
       (3) Submission.--Each local educational agency shall submit 
     the total number of public and private school children 
     described in this paragraph for an academic year to the 
     Secretary not later than February 1 of the academic year.
       (4) Penalty.--If the Secretary determines that a local 
     educational agency has knowingly submitted false information 
     under this subsection for the purpose of gaining additional 
     funds under this section, then the local educational agency 
     shall be fined an amount equal to twice the difference 
     between the amount the local educational agency received 
     under this section, and the correct amount the local 
     educational agency would have received if the agency had 
     submitted accurate information under this subsection.

     SEC. ____02. DIRECT AWARDS OF PART A OF TITLE I FUNDING.

       (a) Direct Awards.--
       (1) In general.--Notwithstanding any other provision of law 
     and subject to subsection (c), the Secretary shall award the 
     total amount of funds appropriated to carry out part A of 
     title I of the Elementary and Secondary Education Act of 1965 
     (20 U.S.C. 6311 et seq.) for a fiscal year directly to local 
     educational agencies in accordance with paragraph (2) to 
     enable the local educational agencies to support programs or 
     activities, for kindergarten through grade 12 students, that 
     the local educational agencies deem appropriate.
       (2) Eligible local educational agencies.--The Secretary 
     shall make awards under this section for a fiscal year only 
     to local educational agencies that are eligible for 
     assistance under part A of title I of the Elementary and 
     Secondary Education Act of 1965 for the fiscal year.
       (b) Amount.--Each local educational agency shall receive an 
     amount awarded under this subsection for a fiscal year equal 
     to the amount the local educational agency is eligible to 
     receive under part A of title I of the Elementary and 
     Secondary Education Act of 1965 for the fiscal year.
       (c) Applicability.--The provisions of this section shall 
     not apply--
       (1) for fiscal year 1999, if the total amount appropriated 
     to carry out part A of title I of the Elementary and 
     Secondary Education Act of 1965 for the fiscal year is less 
     than $7,694,000,000;
       (2) for fiscal year 2000, if the total amount so 
     appropriated for the fiscal year is less than $7,875,000,000;
       (3) for fiscal year 2001, if the total amount so 
     appropriated for the fiscal year is less than $8,064,000,000;
       (4) for fiscal year 2002, if the total amount so 
     appropriated for the fiscal year is less than $8,251,000,000; 
     and
       (5) for fiscal year 2003, if the total amount so 
     appropriated for the fiscal year is less than $8,426,000,000.
       (d) Requirements.--
       (1) Eligible school attendance areas.--A local educational 
     agency shall use funds received under this section only in 
     eligible school attendance areas determined in accordance 
     with section 1113 of the Elementary and Secondary Education 
     Act of 1965 other than subsection (c) of such section.
       (2) Eligible pupils.--A local educational agency shall use 
     funds received under this section--
       (A) in the case of a school that meets the criteria 
     described in section 1114(a)(1), to serve all pupils in the 
     school; and
       (B) in the case of a school that does not meet such 
     criteria, to serve the children attending the school who are 
     eligible children described in section 1115(b).

     SEC. ____03. DIRECT AWARDS OF BILINGUAL EDUCATION FUNDING.

       (a) State Options.--
       (1) In general.--Notwithstanding any other provision of law 
     and subject to subsection (b)(2), each State shall notify the 
     Secretary regarding the State's election to receive the 
     State's portion of the finds appropriated to carry out parts 
     A, B, and C of title VII of the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 7401 et seq., 7511 et seq., 
     and 7541 et seq.) according to one of the following options:
       (A) State block grant option.--The State may receive the 
     funding pursuant to a State allotment described in subsection 
     (c)(1)(A).
       (B) Local block grant option.--The State may direct the 
     Secretary to send the funding

[[Page S3450]]

     directly to local educational agencies in the State that 
     serve the recipients in the State under parts A, B, and C 
     pursuant to a local allotment described in subsection 
     (c)(1)(B).
       (C) Federal statute option.--The State may receive the 
     funding according to the provisions of law described in 
     subsection (e).
       (2) Option requirements.--
       (A) In general.--A State shall select an option described 
     in paragraph (1)--
       (i) within 1 year of the date of enactment of this Act;
       (ii) pursuant to a majority vote of the State legislature; 
     and
       (iii) with the concurrence of the Governor.
       (B) Failure to select an option.--
       (i) In general.--If a State legislature meets within 1 year 
     of the date of enactment of this Act and fails to select an 
     option in accordance with this subsection, the Secretary 
     shall award the applicable funding pursuant to paragraph 
     (1)(B).
       (ii) Legislature which does not meet.--If a State does not 
     select an option described in paragraph (1) in accordance 
     with this subsection because the State legislature does not 
     meet within 1 year of the date of enactment of this Act, the 
     State may select, at the first meeting of the State 
     legislature after such date, any such option in accordance 
     with this subsection, which option shall take effect for the 
     fiscal year that begins after such meeting.
       (C) Changes.--
       (i) Block grants.--If a State selects the option described 
     in subparagraph (A) or (B) of paragraph (1), the State may 
     alter the selection made under paragraph (1) only once and 
     only after receiving the funding for 3 years pursuant to the 
     option described in such subparagraph.
       (ii) Federal statute option.--Subject to clause (i), if a 
     State selects the option described in paragraph (1)(C) for a 
     fiscal year, the State may select the option described in 
     subparagraph (A) or (B) of paragraph (1) for the succeeding 
     fiscal year.
       (3) Multiyear awards.--The Secretary shall use funds 
     appropriated to carry out parts A, B, and C of title VII of 
     the Elementary and Secondary Education Act of 1965 for each 
     fiscal year to make payments to eligible recipients under 
     such parts pursuant to any multiyear award under such parts 
     made prior to the date of enactment of this Act. The payments 
     shall be made for the duration of the multiyear award.
       (4) Definitions.--In this section--
       (A) the term ``State'' means each of the several States of 
     the United States and the District of Columbia; and
       (B) the term ``outlying area'' means the Commonwealth of 
     Puerto Rico, Guam, American Samoa, the Commonwealth of the 
     Northern Mariana Islands, the United States Virgin Islands, 
     the Republic of the Marshall Islands, the Federated States of 
     Micronesia, and the Republic of Palau.
       (b) Reservation and Applicability.--
       (1) Reservation.--From the total amount of funds 
     appropriated to carry out parts A, B, and C of title VII of 
     the Elementary and Secondary Education Act of 1965 for a 
     fiscal year that are not used to carry out subsection (a)(3) 
     for the fiscal year, the Secretary shall reserve 1 percent to 
     make awards to the Bureau of Indian Affairs and the outlying 
     areas according to their respective needs for assistance 
     under this section.
       (2) Applicability.--The provisions of this section shall 
     not apply--
       (A) for fiscal year 1999, if the total amount appropriated 
     to carry out parts A, B, and C of title VII of the Elementary 
     and Secondary Education Act of 1965 for the fiscal year is 
     less than $362,000,000;
       (B) for fiscal year 2000, if the total amount so 
     appropriated for the fiscal year is less than $370,000,000;
       (C) for fiscal year 2001, if the total amount so 
     appropriated for the fiscal year is less than $379,000,000;
       (D) for fiscal year 2002, if the total amount so 
     appropriated for the fiscal year is less than $388,000,000; 
     and
       (E) for fiscal year 2003, if the total amount so 
     appropriated for the fiscal year is less than $398,000,000.
       (c) Block Grants.--
       (1) Allotments.--
       (A) States.--From the total amount of funds appropriated to 
     carry out parts A, B, and C of title VII of the Elementary 
     and Secondary Education Act of 1965 for a fiscal year that 
     are not used to carry out subsection (a)(3) for the fiscal 
     year, and are not reserved under subsection (b)(1) for the 
     fiscal year, the Secretary may make allotments to each State 
     selecting the option described in subsection (a)(1)(A) in an 
     amount that bears the same relation to such total amount of 
     funds as the amount all entities in the State received under 
     such parts for fiscal year 1998 bears to the total amount all 
     entities in all States received under such parts for fiscal 
     year 1998.
       (B) Local educational agencies.--From the total amount of 
     funds appropriated to carry out parts A, B, and C of title 
     VII of the Elementary and Secondary Education Act of 1965 for 
     a fiscal year that are not used to carry out subsection 
     (a)(3) for the fiscal year, and are not reserved under 
     subsection (b)(1) for the fiscal year, the Secretary may make 
     allotments to each local educational agency in a State 
     selecting the option described in subsection (a)(1)(B) in an 
     amount that bears the same relation to such total amount of 
     funds as the amount all recipients in the area served by the 
     local educational agency received under such parts for fiscal 
     year 1998 bears to the total amount all recipients in all 
     areas served by all local educational agencies received under 
     such parts for fiscal year 1998.
       (2) Use of allotted funds.--Funds awarded under this 
     section shall be used to pay for enhanced instructional 
     opportunities for limited English proficient children and 
     youth, that may include--
       (A) family literacy, parent outreach, and training 
     activities designed to assist parents to become active 
     participants in the education of their children;
       (B) salaries of personnel, including teacher aids, who have 
     been specifically trained, or are being trained, to provide 
     services to limited English proficient children and youth;
       (C) tutorials, mentoring, and academic or career counseling 
     for limited English proficient children and youth;
       (D) identification and acquisition of curricular materials, 
     educational software, and technologies to be used;
       (E) basic instructional services that are directly 
     attributable to the presence of limited English proficient 
     children, including the costs of providing additional 
     classroom supplies, overhead costs, costs of construction, 
     acquisition or rental of space, costs of transportation, or 
     such other costs as are directly attributable to such 
     additional basic instructional services; and
       (F) such other activities, related to innovative programs 
     described in subparagraphs (A) through (E), as the Secretary 
     may authorize.
       (3) State funding rule.--
       (A) Administrative expenses and statewide activities.--A 
     State that receives an allotment under paragraph (1)(A) for a 
     fiscal year may use not more than 5 percent of the allotted 
     funds for the fiscal year for administrative expenses or 
     statewide activities.
       (B) State funding rules.--A State that receives an 
     allotment under paragraph (1)(A)--
       (i) may, at the State's discretion, place limits on the use 
     of the allotted funds; and
       (ii) subject to subsection (f), may allocate the allotted 
     funds to public and private entities within the State as the 
     State determines appropriate.
       (d) Federal Statute Option.--
       (1) In general.--From the total amount of funds 
     appropriated to carry out parts A, B, and C of the Elementary 
     and Secondary Education Act of 1965 for a fiscal year that 
     remain after carrying out subsection (a)(3) for the fiscal 
     year, making the reservation under subsection (b) for the 
     fiscal year, and making allotments under subsection (c) for 
     the fiscal year, the Secretary may make awards according to 
     the provisions of such parts A, B, and C, respectively, to 
     State and local recipients, in States making the election 
     described in subsection (a)(1)(C).
       (2) Percentage reductions.--The Secretary, after making the 
     allotments under subsection (c) for a fiscal year, shall 
     reduce the total amount of funding available to carry out 
     such parts A, B, and C for the fiscal year, for any State 
     selecting the option described in subsection (a)(1)(C), by an 
     equal percentage for each such part.
       (e) Construction.--Nothing in this section shall be 
     construed--
       (1) to prohibit a local educational agency from serving 
     limited English proficient children simultaneously with 
     students with similar educational needs, in the same 
     educational settings where appropriate; and
       (2) to mandate a particular type of curriculum or 
     educational method for limited English proficient children 
     and youth, which decisions--
       (A) shall be the sole responsibility of the State 
     educational agency, local educational agency, or other State 
     or local recipients; and
       (B) shall be made in accordance with applicable State law.

     SEC. ____04. PARTICIPATION OF CHILDREN ENROLLED IN PRIVATE 
                   SCHOOLS.

       (a) In General.--Each local educational agency that 
     receives assistance under sections ____01 or ____03 shall 
     provide for the participation of children enrolled in private 
     schools in the activities and services assisted under 
     sections ____01 or ____03, respectively, in the same manner 
     as the children participate in activities and services under 
     the Elementary and Secondary Education Act of 1965 (20 U.S.C. 
     6301 et seq.) pursuant to sections 14503, 14504, 14505, and 
     14506 of such Act (20 U.S.C. 8893, 8894, 8895, and 8896).
       (b) Part A of Title I Funding.--Each local educational 
     agency that receives assistance under section ____02 shall 
     provide for the participation of children enrolled in private 
     schools in the activities and services assisted under section 
     ____02 in the same manner as the children participate in 
     activities and services under the Elementary and Secondary 
     Education Act of 1965 (20 U.S.C. 6301 et seq.) pursuant to 
     section 1120 such Act (20 U.S.C. 6321).

     SEC. ____05. ACCOUNTABILITY.

       (a) Standard Application and Reporting Forms.--The 
     Secretary shall develop standard forms for applications for 
     assistance under this title and for reporting with respect to 
     activities assisted under this title. In developing the 
     forms, the Secretary shall ensure that not more than 2 
     percent of the assistance provided to an entity under this 
     title is used to complete the forms.
       (b) Public Input.--Each entity receiving assistance under 
     this title shall--
       (1) involve parents and members of the public in planning 
     for the use of funds provided under this title; and

[[Page S3451]]

       (2) disseminate to the public reports regarding the use and 
     effects of funds provided under this title.

     SEC. ____06. DEFINITIONS.

       In this title--
       (1) the term ``local educational agency'' has the meaning 
     given the term in section 14101 of the Elementary and 
     Secondary Education Act of 1965 (20 U.S.C. 8801); and
       (2) the term ``Secretary'' means the Secretary of 
     Education.

     SEC. ____07. CONSTRUCTION.

       Nothing in this title shall be construed to supersede the 
     authority of a State or State educational agency over State 
     education policies.
                                 ______
                                 

                       MURRAY AMENDMENT NO. 2295

  Mrs. MURRAY proposed an amendment to the bill, H.R. 2646, supra; as 
follows:

       At the end, add the following:
                     TITLE ____--SENSE OF CONGRESS

     SEC. ____01. SENSE OF CONGRESS.

       Congress makes the following findings:
       (1) Qualified teachers in small classes can provide 
     students with more individualized attention, spend more time 
     on instruction and less on other tasks, cover more material 
     effectively, and are better able to work with parents to help 
     the parents further their children's education.
       (2) Rigorous research has shown that students attending 
     small classes in the early grades make more rapid educational 
     progress than the students in larger classes, and that those 
     achievement gains persist through at least the 8th grade. For 
     example:
       (A) In a landmark 4-year experimental study of class size 
     reduction in grades kindergarten through grade 3 in 
     Tennessee, researchers found that students in smaller classes 
     earned significantly higher scores on basic skills tests in 
     all 4 years and in all types of schools, including urban, 
     rural, and suburban schools.
       (B) After 2 years in reduced class sizes, students in the 
     Flint, Michigan Public School District improved their reading 
     scores by 44 percent.
       (3) The benefits of smaller classes are greatest for lower-
     achieving, minority, poor, and inner-city children. One study 
     found that urban 4th-graders in smaller than average classes 
     were \3/4\ of a school year ahead of their counterparts in 
     larger than average classes.
       (4) Smaller classes allow teachers to identify and work 
     sooner with students who have learning disabilities and, 
     potentially, can reduce those students' need for special 
     education services in the later grades.
       (5) Students in smaller classes are able to become more 
     actively engaged in learning than their peers in large 
     classes.
       (6) Efforts to improve educational outcomes by reducing 
     class sizes in the early grades are likely to be successful 
     only if well-qualified teachers are hired to fill additional 
     classroom positions and if teachers received intensive, 
     continuing training in working effectively in smaller 
     classroom settings.
       (7) State certified and licensed teachers help ensure high 
     quality instruction in the classroom.
       (8) According to the National Commission on Teaching and 
     America's Future, the most important influence on student 
     achievement is the expertise of their teachers. One New York 
     City study comparing high- and low-achieving elementary 
     schools with similar student characteristics, found that more 
     than 90 percent of the variation in achievement in 
     mathematics and reading was due to differences in teacher 
     qualifications.
       (9) Our Nation needs more qualified teachers to meet 
     changing demographics and to help students meet high 
     standards, as demonstrated by the following:
       (A) Over the next decade, our Nation will need to hire over 
     2,000,000 teachers to meet increasing student enrollments and 
     teacher retirements.
       (B) 1 out of 4 high school teachers does not have a major 
     or minor in the main subject that they teach. This is true 
     for more than 30 percent of mathematics teachers.
       (C) In schools with the highest minority enrollments, 
     students have less than a 50 percent chance of getting a 
     science or mathematics teacher who holds a degree in that 
     field.
       (D) In 1991, 25 percent of new public school teachers had 
     not completed the requirements for a license in their main 
     assignment field. This number increased to 27 percent by 
     1994, including 11 percent who did not have a license.
       (10) We need more teachers who are adequately prepared for 
     the challenges of the 21st century classroom, as demonstrated 
     by the fact that--
       (A) 50 percent of teachers have little or no experience 
     using technology in the classroom; and
       (B) in 1994, only 10 percent of new teachers felt they were 
     prepared to integrate new technology into their instruction.
       (11) Teacher quality cannot be further compromised to meet 
     the demographic demand for new teachers and smaller class 
     sizes. Comprehensive improvements in teacher preparation and 
     development programs are also necessary to ensure the 
     effectiveness of new teachers and the academic success of 
     students in the classroom. These comprehensive improvements 
     should include encouraging more institutions of higher 
     education that operate teacher preparation programs to work 
     in partnership with local educational agencies and elementary 
     and secondary schools; providing more hands-on, classroom 
     experience to prospective teachers; creating mentorship 
     programs for new teachers; providing high quality content 
     area training and classroom skills for new teachers; and 
     training teachers to incorporate technology into the 
     classroom.
       (12) Efforts should be made to provide prospective teachers 
     with a greater knowledge of instructional programs that are 
     research-based, of demonstrated effectiveness, replicable in 
     diverse and challenging circumstances, and supported by 
     networks of experts and experienced practitioners.
       (13) Several States have begun serious efforts to reduce 
     class sizes in the early elementary grades, but these actions 
     may be impeded by financial limitations or difficulties in 
     hiring qualified teachers.
       (14) The Federal Government can assist in this effort by 
     providing funding for class size reductions in grades 1 
     through 3, and by helping to ensure that the new teachers 
     brought into the classroom are well-qualified.

     SEC. ____02. SENSE OF CONGRESS.

       It is the sense of Congress that Congress should support 
     efforts to hire 100,000 new teachers to reduce class sizes in 
     first, second, and third grades to an average of 18 students 
     per class all across America.
                                 ______
                                 

                     HUTCHINSON AMENDMENT NO. 2296

  Mr. HUTCHINSON proposed an amendment to amendment No. 2295 proposed 
by Mrs. Murray to the bill, H.R. 2646, supra; as follows:

       Strike all after ``TITLE ____'' and insert the following:
                          --SENSE OF CONGRESS

     SEC. ____01. FINDINGS.

       Congress makes the following findings:
       (1) The people of the United States know that effective 
     teaching takes place when the people of the United States 
     begin (A) helping children master basic academics, (B) 
     engaging and involving parents, (C) creating safe and orderly 
     classrooms, and (D) getting dollars to the classroom.
       (2) Our Nation's children deserve an educational system 
     which will provide opportunities to excel.
       (3) States and localities must spend a significant amount 
     of Federal education tax dollars applying for and 
     administering Federal education dollars.
       (4) Several States have reported that although the States 
     receive less than 10 percent of their education funding from 
     the Federal Government, more than 50 percent of their 
     paperwork is associated with those Federal dollars.
       (5) While it is unknown exactly what percentage of Federal 
     education dollars reaches the classroom, a recent audit of 
     New York City public schools found that only 43 percent of 
     their local education budget reaches the classroom; further, 
     it is thought that only 85 percent of funds administered by 
     the Department of Education for elementary and secondary 
     education reach the school district level; and even if 65 
     percent of Federal education funds reach the classroom, it 
     still means that billions of dollars are not directly spent 
     on children in the classroom.
       (6) American students are not performing up to their full 
     academic potential, despite the more than 760 Federal 
     education programs, which span 39 Federal agencies at the 
     price of nearly $100,000,000,000 annually.
       (7) According to the Digest of Education Statistics, in 
     1993 only $141,598,786,000 out of $265,285,370,000 spent on 
     elementary and secondary education was spent on instruction.
       (8) According to the National Center for Education 
     Statistics, in 1994 only 52 percent of staff employed in 
     public elementary and secondary school systems were teachers.
       (9) Too much of our Federal education funding is spent on 
     bureaucracy, and too little is spent on our Nation's youth.
       (10) Getting 95 percent of Department of Education 
     elementary and secondary education funds to the classroom 
     could provide approximately $2,094 in additional funding per 
     classroom across the United States.
       (11) More education funding should be put in the hands of 
     someone in a child's classroom who knows the child's name.
       (12) President Clinton has stated: ``We cannot ask the 
     American people to spend more on education until we do a 
     better job with the money we've got now.''.
       (13) President Clinton and Vice President Gore agree that 
     the reinventing of public education will not begin in 
     Washington but in communities across the United States and 
     that the people of the United States must ask fundamental 
     questions about how our Nation's public school systems' 
     dollars are spent.
       (14) President Clinton and Vice President Gore agree that 
     in an age of tight budgets, our Nation should be spending 
     public funds on teachers and children, not on unnecessary 
     overhead and bloated bureaucracy.

     SEC. ____02. SENSE OF CONGRESS.

       It is the sense of Congress that the Department of 
     Education, States, and local educational agencies should work 
     together to ensure that not less than 95 percent of all funds 
     appropriated for the purpose of carrying out elementary and 
     secondary education programs administered by the Department 
     of Education is spent for our Nation's children in their 
     classrooms.

[[Page S3452]]

                                 ______
                                 

                        COATS AMENDMENT NO. 2297

  Mr. COATS proposed an amendment to the bill, H.R. 2646, supra; as 
follows:

       At the end add the following:
     TITLE ____--ADDITIONAL INCENTIVE TO MAKE SCHOLARSHIP DONATIONS

     SEC. ____. ADDITIONAL INCENTIVE TO MAKE DONATIONS TO SCHOOLS 
                   OR ORGANIZATIONS WHICH OFFER SCHOLARSHIPS.

       (a) In General.--Section 170 (relating to charitable, etc., 
     contributions and gifts) is amended by redesignating 
     subsection (m) as subsection (n) and by inserting after 
     subsection (l) the following:
       ``(m) Treatment of Amounts Paid to Certain Educational 
     Organizations.--
       ``(1) In general.--For purposes of this section, 110 
     percent of any amount described in paragraph (2) shall be 
     treated as a charitable contribution.
       ``(2) Amount described.--For purposes of paragraph (1), an 
     amount is described in this paragraph if the amount--
       ``(A) is paid in cash by the taxpayer to or for the benefit 
     of a qualified organization, and
       ``(B) is used by such organization to provide qualified 
     scholarships (as defined in section 117(b)) to any individual 
     attending kindergarten through grade 12 whose family income 
     does not exceed 185 percent of the poverty line for a family 
     of the size involved.
       ``(3) Definitions.--For purposes of this subsection--
       ``(A) Qualified organization.--The term `qualified 
     organization' means--
       ``(i) an educational organization--

       ``(I) which is described in subsection (b)(1)(A)(ii), and
       ``(II) which provides elementary education or secondary 
     education (kindergarten through grade 12), as determined 
     under State law, or

       ``(ii) an organization which is described in section 
     501(c)(3) and exempt from taxation under section 501(a).
       ``(B) Poverty line.--The term `poverty line' means the 
     income 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) applicable to a family of the size involved.
       ``(4) Termination.--This subsection shall not apply to 
     contributions made after December 31, 2002.''
       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.

     SEC. ____. CLARIFICATION AND EXPANSION OF MATHEMATICAL ERROR 
                   ASSESSMENT PROCEDURES.

       (a) TIN Deemed Incorrect if Information on Return Differs 
     With Agency Records.--Section 6213(g)(2) (defining 
     mathematical or clerical error) is amended by adding at the 
     end the following flush sentence:
     ``A taxpayer shall be treated as having omitted a correct TIN 
     for purposes of the preceding sentence if information 
     provided by the taxpayer on the return with respect to the 
     individual whose TIN was provided differs from the 
     information the Secretary obtains from the person issuing the 
     TIN.''
       (b) Expansion of Mathematical Error Procedures to Cases 
     Where TIN Establishes Individual Not Eligible for Tax 
     Credit.--Section 6213(g)(2), as amended by title VI of this 
     Act, is amended by striking ``and'' at the end of 
     subparagraph (J), by striking the period at the end of the 
     subparagraph (K) and inserting ``, and'', and by adding at 
     the end the following new subparagraph:
       ``(L) the inclusion on a return of a TIN required to be 
     included on the return under section 21, 24, or 32 if--
       ``(i) such TIN is of an individual whose age affects the 
     amount of the credit under such section, and
       ``(ii) the computation of the credit on the return reflects 
     the treatment of such individual as being of an age different 
     from the individual's age based on such TIN.''
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years ending after the date of the 
     enactment of this Act.

     SEC. ____. CERTAIN CUSTOMER RECEIVABLES INELIGIBLE FOR MARK-
                   TO-MARKET TREATMENT.

       (a) Certain Receivables Not Eligible for Mark to Market.--
     Section 475(c) (relating to definitions) is amended by adding 
     at the end the following new paragraph:
       ``(4) Special rules for certain receivables.--
       ``(A) In general.--Paragraph (2)(C) shall not include any 
     note, bond, debenture, or other evidence of indebtedness 
     which is nonfinancial customer paper.
       ``(B) Nonfinancial customer paper.--For purposes of 
     subparagraph (A), the term `nonfinancial customer paper' 
     means any receivable--
       ``(i) arising out of the sale of goods or services by a 
     person the principal activity of which is the selling or 
     providing of nonfinancial goods and services, and
       ``(ii) held by such person or a related person at all times 
     since issue.''
       (b) Effective Date.--
       (1) In general.--The amendments made by this section shall 
     apply to taxable years ending after the date of the enactment 
     of this Act.
       (2) Change in method of accounting.--In the case of any 
     taxpayer required by the amendments made by this section to 
     change its method of accounting for its first taxable year 
     ending after the date of the enactment of this Act--
       (A) such change shall be treated as initiated by the 
     taxpayer,
       (B) such change shall be treated as made with the consent 
     of the Secretary of the Treasury, and
       (C) the net amount of the adjustments required to be taken 
     into account by the taxpayer under section 481 of the 
     Internal Revenue Code of 1986 shall be taken into account 
     ratably over the 4-taxable year period beginning with such 
     first taxable year.
                                 ______
                                 

                       McCAIN AMENDMENT NO. 2298

  (Ordered to lie on the table.)
  Mr. McCAIN. submitted an amendment intended to be proposed by him to 
the bill, H.R. 2646, supra; as follows:

       At the appropriate place, insert the following:

     SEC. ____. MULTILINGUALISM STUDY.

       (a) Findings.--Congress finds that even though all 
     residents of the United States should be proficient in 
     English, without regard to their country of birth, it is also 
     of vital importance to the competitiveness of the United 
     States that those residents be encouraged to learn other 
     languages.
       (b) Resident of the United States Defined.--In this 
     section, the term ``resident of the United States'' means an 
     individual who resides in the United States, other than an 
     alien who is not lawfully present in the United States.
       (c) Study.--
       (1) In general.--Not later than 180 days after the date of 
     enactment of this Act, the Comptroller General of the United 
     States (referred to in this section as the ``Comptroller 
     General'') shall conduct a study of multilingualism in the 
     United States in accordance with this section.
       (2) Requirements.--
       (A) In general.--The study conducted under this section 
     shall ascertain--
       (i) the percentage of residents in the United States who 
     are proficient in English and at least 1 other language;
       (ii) the predominant language other than English in which 
     residents referred to in clause (i) are proficient;
       (iii) the percentage of the residents described in clause 
     (i) who were born in a foreign country;
       (iv) the percentage of the residents described in clause 
     (i) who were born in the United States;
       (v) the percentage of the residents described in clause 
     (iv) who are second-generation residents of the United 
     States; and
       (vi) the percentage of the residents described in clause 
     (iv) who are third-generation residents of the United States.
       (B) Age-specific categories.--The study under this section 
     shall, with respect to the residents described in 
     subparagraph (A)(i), determine the number of those residents 
     in each of the following categories:
       (i) Residents who have not attained the age of 12.
       (ii) Residents have attained the age of 12, but have not 
     attained the age of 18.
       (iii) Residents who have attained the age of 18, but have 
     not attained the age of 50.
       (iv) Residents who have attained the age of 50.
       (C) Federal programs.--In conducting the study under this 
     section, the Comptroller General shall establish a list of 
     each Federal program that encourages multilingualism with 
     respect to any category of residents described in 
     subparagraph (B).
       (D) Comparisons.--In conducting the study under this 
     section, the Comptroller General shall compare the 
     multilingual population described in subparagraph (A) with 
     the multilingual populations of foreign countries--
       (i) in the Western hemisphere; and
       (ii) in Asia.
       (d) Report.--Upon completion of the study under this 
     section, the Comptroller General shall prepare, and submit to 
     Congress, a report that contains the results of the study 
     conducted under this section, and such findings and 
     recommendations as the Comptroller General determines to be 
     appropriate.
                                 ______
                                 

                LEVIN (AND BINGAMAN) AMENDMENT NO. 2299

  Mr. LEVIN (for himself and Mr. Bingaman) proposed an amendment to the 
bill, H.R. 2646, supra; as follows:

       Beginning on page 2, line 9, strike all through page 10, 
     line 21, and insert:

     SEC. 101. MODIFICATIONS TO EDUCATION INDIVIDUAL RETIREMENT 
                   ACCOUNTS.

       (a) Maximum Annual Contributions.--
       (1) In general.--Section 530(b)(1)(A)(iii) (defining 
     education individual retirement account) is amended by 
     striking ``$500'' and inserting ``the contribution limit for 
     such taxable year''.
       (2) Contribution limit.--Section 530(b) (relating to 
     definitions and special rules) is amended by adding at the 
     end the following new paragraph:
       ``(4) Contribution limit.--The term `contribution limit' 
     means $500 ($2,000 in the case of any taxable year beginning 
     after December 31, 1998, and ending before January 1, 
     2003).''
       (3) Conforming amendments.--
       (A) Section 530(d)(4)(C) is amended by striking ``$500'' 
     and inserting ``the contribution limit for such taxable 
     year''.
       (B) Section 4973(e)(1)(A) is amended by striking ``$500'' 
     and inserting ``the contribution limit (as defined in section 
     530(b)(5)) for such taxable year''.

[[Page S3453]]

       (b) Waiver of Age Limitations for Children With Special 
     Needs.--Section 530(b)(1) (defining education individual 
     retirement account) is amended by adding at the end the 
     following flush sentence:

     ``The age limitations in the preceding sentence shall not 
     apply to any designated beneficiary with special needs (as 
     determined under regulations prescribed by the Secretary).''
       (c) Corporations Permitted To Contribute to Accounts.--
     Section 530(c)(1) (relating to reduction in permitted 
     contributions based on adjusted gross income) is amended by 
     striking ``The maximum amount which a contributor'' and 
     inserting ``In the case of a contributor who is an 
     individual, the maximum amount the contributor''.
       (d) No Double Benefit.--Section 530(d)(2) (relating to 
     distributions for qualified education expenses) is amended by 
     adding at the end the following new subparagraph:
       ``(D) Disallowance of excluded amounts as credit or 
     deduction.--No deduction or credit shall be allowed to the 
     taxpayer under any other section of this chapter for any 
     qualified education expenses to the extent taken into account 
     in determining the amount of the exclusion under this 
     paragraph.''
       (e) Technical Corrections.--
       (1)(A) Section 530(b)(1)(E) (defining education individual 
     retirement account) is amended to read as follows:
       ``(E) Any balance to the credit of the designated 
     beneficiary on the date on which the beneficiary attains age 
     30 shall be distributed within 30 days after such date to the 
     beneficiary or, if the beneficiary dies before attaining age 
     30, shall be distributed within 30 days after the date of 
     death to the estate of such beneficiary.''
       (B) Section 530(d) (relating to tax treatment of 
     distributions) is amended by adding at the end the following 
     new paragraph:
       ``(8) Deemed distribution on required distribution date.--
     In any case in which a distribution is required under 
     subsection (b)(1)(E), any balance to the credit of a 
     designated beneficiary as of the close of the 30-day period 
     referred to in such subsection for making such distribution 
     shall be deemed distributed at the close of such period.''
       (2)(A) Section 530(d)(1) is amended by striking ``section 
     72(b)'' and inserting ``section 72''.
       (B) Section 72(e) (relating to amounts not received as 
     annuities) is amended by inserting after paragraph (8) the 
     following new paragraph:
       ``(9) Extension of paragraph (2)(b) to qualified state 
     tuition programs and educational individual retirement 
     accounts.--Notwithstanding any other provision of this 
     subsection, paragraph (2)(B) shall apply to amounts received 
     under a qualified State tuition program (as defined in 
     section 529(b)) or under an education individual retirement 
     account (as defined in section 530(b)). The rule of paragraph 
     (8)(B) shall apply for purposes of this paragraph.''
       (3) Section 530(d)(4)(B) (relating to exceptions) is 
     amended by striking ``or'' at the end of clause (ii), by 
     striking the period at the end of clause (iii) and inserting 
     ``, or'', and by adding at the end the following new clause:
       ``(iv) an amount which is includible in gross income solely 
     because the taxpayer elected under paragraph (2)(C) to waive 
     the application of paragraph (2) for the taxable year.''
       (f) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to taxable years 
     beginning after December 31, 1998.
       (2) Technical corrections.--The amendments made by 
     subsection (e) shall take effect as if included in the 
     amendments made by section 213 of the Taxpayer Relief Act of 
     1997.
       On page 21, between lines 9 and 10, insert:

     SEC. 107. INCREASED LIFETIME LEARNING CREDIT FOR TECHNOLOGY 
                   TRAINING OF ELEMENTARY AND SECONDARY TEACHERS.

       (a) In General.--Section 25A(c) (relating to lifetime 
     learning credit) is amended by adding at the end the 
     following new paragraph:
       ``(3) Special rule for technology training of certain 
     teachers.--
       ``(A) In general.--If any portion of the qualified tuition 
     and related expenses to which this subsection applies--
       ``(i) are paid or incurred by an individual who is a 
     kindergarten through grade 12 teacher in an elementary or 
     secondary school, and
       ``(ii) are incurred as part of a program which is approved 
     and certified by the appropriate local educational agency as 
     directly related to improvement of the individual's capacity 
     to use technology in teaching,

     paragraph (1) shall be applied with respect to such portion 
     by substituting `50 percent' for `20 percent'.
       ``(B) Termination.--This paragraph shall not apply to 
     expenses paid after December 31, 2002, for education 
     furnished in academic periods beginning after such date.''
       (b) Effective Date.--The amendment made by this section 
     shall apply to expenses paid after June 30, 1998, for 
     education furnished in academic periods beginning after such 
     date.
                                 ______
                                 

                ASHCROFT (AND OTHERS) AMENDMENT NO. 2300

  Mr. ASHCROFT (for himself, Mr. Hagel, and Mr. Nickles) proposed an 
amendment to amendment No. 2299 proposed by Mr. Levin to the bill, H.R. 
2646, supra; as follows:

       Strike all after ``SEC.'' and insert the following:

     101. MODIFICATIONS TO EDUCATION INDIVIDUAL RETIREMENT 
                   ACCOUNTS.

       (a) Tax-Free Expenditures for Elementary and Secondary 
     School Expenses.--
       (1) In general.--Section 530(b)(2) (defining qualified 
     higher education expenses) is amended to read as follows:
       ``(2) Qualified education expenses.--
       ``(A) In general.--The term `qualified education expenses' 
     means--
       ``(i) qualified higher education expenses (as defined in 
     section 529(e)(3)), and
       ``(ii) qualified elementary and secondary education 
     expenses (as defined in paragraph (4)).

     Such expenses shall be reduced as provided in section 
     25A(g)(2).
       ``(B) Qualified state tuition programs.--Such term shall 
     include amounts paid or incurred to purchase tuition credits 
     or certificates, or to make contributions to an account, 
     under a qualified State tuition program (as defined in 
     section 529(b)) for the benefit of the beneficiary of the 
     account.''
       (2) Qualified elementary and secondary education 
     expenses.--Section 530(b) (relating to definitions and 
     special rules) is amended by adding at the end the following 
     new paragraph:
       ``(4) Qualified elementary and secondary education 
     expenses.--
       ``(A) In general.--The term `qualified elementary and 
     secondary education expenses' means--
       ``(i) expenses for tuition, fees, academic tutoring, 
     special needs services, books, supplies, computer equipment 
     (including related software and services), and other 
     equipment which are incurred in connection with the 
     enrollment or attendance of the designated beneficiary of the 
     trust as an elementary or secondary school student at a 
     public, private, or religious school, or
       ``(ii) expenses for room and board, uniforms, 
     transportation, and supplementary items and services 
     (including extended day programs) which are required or 
     provided by a public, private, or religious school in 
     connection with such enrollment or attendance.
       ``(B) Special rule for homeschooling.--Such term shall 
     include expenses described in subparagraph (A)(i) in 
     connection with education provided by homeschooling if the 
     requirements of any applicable State or local law are met 
     with respect to such education.
       ``(C) School.--The term `school' means any school which 
     provides elementary education or secondary education 
     (kindergarten through grade 12), as determined under State 
     law.''
       (3) Special rules for applying exclusion to elementary and 
     secondary expenses.--Section 530(d)(2) (relating to 
     distributions for qualified higher education expenses) is 
     amended by adding at the end the following new subparagraph:
       ``(D) Special rules for elementary and secondary 
     expenses.--
       ``(i) In general.--The aggregate amount of qualified 
     elementary and secondary education expenses taken into 
     account for purposes of this paragraph with respect to any 
     education individual retirement account for all taxable years 
     shall not exceed the sum of the aggregate contributions to 
     such account for taxable years beginning after December 31, 
     1998, and before January 1, 2003, and earnings on such 
     contributions.
       ``(ii) Special operating rules.--For purposes of clause 
     (i)--

       ``(I) the trustee of an education individual retirement 
     account shall keep separate accounts with respect to 
     contributions and earnings described in clause (i), and
       ``(II) if there are distributions in excess of qualified 
     elementary and secondary education expenses for any taxable 
     year, such excess distributions shall be allocated first to 
     contributions and earnings not described in clause (i).''

       (4) Conforming amendments.--Subsections (b)(1) and (d)(2) 
     of section 530 are each amended by striking ``higher'' each 
     place it appears in the text and heading thereof.
       (b) Maximum Annual Contributions.--
       (1) In general.--Section 530(b)(1)(A)(iii) (defining 
     education individual retirement account) is amended by 
     striking ``$500'' and inserting ``the contribution limit for 
     such taxable year''.
       (2) Contribution limit.--Section 530(b) (relating to 
     definitions and special rules), as amended by subsection 
     (a)(2), is amended by adding at the end the following new 
     paragraph:
       ``(5) Contribution limit.--The term `contribution limit' 
     means $500 ($2,000 in the case of any taxable year beginning 
     after December 31, 1998, and ending before January 1, 
     2003).''
       (3) Conforming amendments.--
       (A) Section 530(d)(4)(C) is amended by striking ``$500'' 
     and inserting ``the contribution limit for such taxable 
     year''.
       (B) Section 4973(e)(1)(A) is amended by striking ``$500'' 
     and inserting ``the contribution limit (as defined in section 
     530(b)(5)) for such taxable year''.

[[Page S3454]]

       (c) Waiver of Age Limitations for Children With Special 
     Needs.--Section 530(b)(1) (defining education individual 
     retirement account) is amended by adding at the end the 
     following flush sentence:

     ``The age limitations in the preceding sentence shall not 
     apply to any designated beneficiary with special needs (as 
     determined under regulations prescribed by the Secretary).''
       (d) Corporations Permitted To Contribute to Accounts.--
     Section 530(c)(1) (relating to reduction in permitted 
     contributions based on adjusted gross income) is amended by 
     striking ``The maximum amount which a contributor'' and 
     inserting ``In the case of a contributor who is an 
     individual, the maximum amount the contributor''.
       (e) No Double Benefit.--Section 530(d)(2) (relating to 
     distributions for qualified education expenses), as amended 
     by subsection (a)(3), is amended by adding at the end the 
     following new subparagraph:
       ``(E) Disallowance of excluded amounts as credit or 
     deduction.--No deduction or credit shall be allowed to the 
     taxpayer under any other section of this chapter for any 
     qualified education expenses to the extent taken into account 
     in determining the amount of the exclusion under this 
     paragraph.''
       (f) Technical Corrections.--
       (1)(A) Section 530(b)(1)(E) (defining education individual 
     retirement account) is amended to read as follows:
       ``(E) Any balance to the credit of the designated 
     beneficiary on the date on which the beneficiary attains age 
     30 shall be distributed within 30 days after such date to the 
     beneficiary or, if the beneficiary dies before attaining age 
     30, shall be distributed within 30 days after the date of 
     death to the estate of such beneficiary.''
       (B) Section 530(d) (relating to tax treatment of 
     distributions) is amended by adding at the end the following 
     new paragraph:
       ``(8) Deemed distribution on required distribution date.--
     In any case in which a distribution is required under 
     subsection (b)(1)(E), any balance to the credit of a 
     designated beneficiary as of the close of the 30-day period 
     referred to in such subsection for making such distribution 
     shall be deemed distributed at the close of such period.''
       (2)(A) Section 530(d)(1) is amended by striking ``section 
     72(b)'' and inserting ``section 72''.
       (B) Section 72(e) (relating to amounts not received as 
     annuities) is amended by inserting after paragraph (8) the 
     following new paragraph:
       ``(9) Extension of paragraph (2)(b) to qualified state 
     tuition programs and educational individual retirement 
     accounts.--Notwithstanding any other provision of this 
     subsection, paragraph (2)(B) shall apply to amounts received 
     under a qualified State tuition program (as defined in 
     section 529(b)) or under an education individual retirement 
     account (as defined in section 530(b)). The rule of paragraph 
     (8)(B) shall apply for purposes of this paragraph.''
       (3) Section 530(d)(4)(B) (relating to exceptions) is 
     amended by striking ``or'' at the end of clause (ii), by 
     striking the period at the end of clause (iii) and inserting 
     ``, or'', and by adding at the end the following new clause:
       ``(iv) an amount which is includible in gross income solely 
     because the taxpayer elected under paragraph (2)(C) to waive 
     the application of paragraph (2) for the taxable year.''
       (g) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to taxable years 
     beginning after December 31, 1998.
       (2) Technical corrections.--The amendments made by 
     subsection (f) shall take effect as if included in the 
     amendments made by section 213 of the Taxpayer Relief Act of 
     1997.

     SEC. 102. PROHIBITION ON FEDERALLY SPONSORED TESTING.

       (a) Findings.--Congress makes the following findings:
       (1) High State and local standards in reading, mathematics, 
     and other core academic subjects are essential to the future 
     well-being of elementary and secondary education in the 
     United States.
       (2) State and local control of education is the hallmark of 
     education in the United States.
       (3) Each of the 50 States already utilizes numerous tests 
     to measure student achievement, including State and 
     commercially available assessments. State assessments are 
     based primarily upon State and locally developed academic 
     standards.
       (4) Public Law 105-78, the Departments of Labor, Health and 
     Human Services, and Education, and Related Agencies 
     Appropriations Act, 1998, ensures that Federal funds may not 
     be used to field test, pilot test, implement, administer, or 
     distribute in any way, any federally sponsored national test 
     in fiscal year 1998, requires the National Academy of 
     Sciences to conduct a study to determine whether an 
     equivalency scale can be developed that would allow existing 
     tests to be compared one to another, and permits very limited 
     test development activities in fourth grade reading and 
     eighth grade mathematics in fiscal year 1998.
       (5) There is no specific or explicit authority in current 
     Federal law authorizing the proposed federally sponsored 
     national tests in fourth grade reading and eighth grade 
     mathematics.
       (6) The decision of whether or not the United States 
     implements, administers, disseminates, or otherwise has 
     federally sponsored national tests in fourth grade reading 
     and eighth grade mathematics or any other subject, will be 
     determined primarily through the normal legislative process 
     involving Congress and the respective authorizing committees.
       (b) Prohibition on Federally Sponsored Testing.--Part C of 
     the General Education Provisions Act (20 U.S.C. 1231 et seq.) 
     is amended by adding at the end the following:

     ``SEC. 447. PROHIBITION ON FEDERALLY SPONSORED TESTING.

       ``(a) General Prohibition.--Notwithstanding any other 
     provision of Federal law and, except as provided in sections 
     305 through 311 of Public Law 105-78, the Departments of 
     Labor, Health and Human Services, and Education, and Related 
     Agencies Appropriations Act, 1998, funds provided to the 
     Department of Education or to an applicable program under 
     this Act or any other Act, may not be used to develop, plan, 
     implement (including pilot testing or field testing), or 
     administer any federally sponsored national test in reading, 
     mathematics, or any other subject that is not specifically 
     and explicitly provided for in authorizing legislation 
     enacted into law.
       ``(b) Exceptions.--Subsection (a) shall not apply to the 
     Third International Mathematics and Science Study or other 
     international comparative assessments developed under the 
     authority of section 404(a)(6) of the National Education 
     Statistics Act of 1994 (20 U.S.C. 9003(a)(6) et seq.), and 
     administered to only a representative sample of pupils in the 
     United States and in foreign nations.''.
                                 ______
                                 

                      LANDRIEU AMENDMENT NO. 2301

  Ms. LANDRIEU proposed an amendment to the bill, H.R. 2646, supra; as 
follows:

       Strike section 101, and insert the following:

     SEC. 101. BLUE RIBBON SCHOOLS.

       (a) Program Authorized.--
       (1) Recognition.--The Secretary of Education is authorized 
     to carry out a program that recognizes public and private 
     elementary and secondary schools that have established 
     standards of excellence and demonstrated a high level of 
     quality.
       (2) Designation.--Each school recognized under paragraph 
     (1) shall be designated as a ``Blue Ribbon School'' for a 
     period of 3 years.
       (b) Awards.--
       (1) Amount.--The Secretary shall make an award for each 
     school recognized under subsection (a) in the amount of 
     $50,000.
       (2) Special rule.--If the Secretary is prohibited from 
     making an award directly to a school, the Secretary shall 
     make such award to the local educational agency serving such 
     school for the exclusive use of such school.
       (3) Private schools.--Awards for private schools recognized 
     under subsection (a) shall be used to provide students and 
     teachers at the schools with educational services and 
     benefits that are similar to, and provided in the same manner 
     as, the services and benefits provided to private school 
     students and teachers under part A of title I, or title VI, 
     of the Elementary and Secondary Education Act of 1965.
       (4) Limitation.--The Secretary shall not make more than 250 
     awards under this section for any fiscal year.
       (5) Wait-out period.--The Secretary shall not make a second 
     or subsequent award to a school under this section before the 
     expiration of the 3-year designation period under subsection 
     (a)(2) that is applicable to the preceding award.
       (c) Applications and Technical Assistance Grants.--
       (1) Applications.--Each school desiring recognition under 
     subsection (a)(1) shall submit to the Secretary an 
     application at such time, in such manner, and accompanied by 
     such information as the Secretary may require.
       (2) Technical assistance grants.--The Secretary is 
     authorized to award grants to States to enable the States to 
     provide technical assistance to schools desiring recognition 
     under subsection (a)(1).
       (d) Authorization of Appropriations.--
       (1) In general.--There is authorized to be appropriated to 
     carry out this section (other than subsection (c)(2)) 
     $125,000,000 for each of the fiscal years 1999 through 2003.
       (2) Technical assistance grants.--There is authorized to be 
     appropriated to carry out subsection (c)(2) $2,000,000 for 
     each of the fiscal years 1999 through 2003.
                                 ______
                                 

                     KEMPTHORNE AMENDMENT NO. 2302

  Mr. KEMPTHORNE proposed an amendment to amendment No. 2301 proposed 
by Ms. Landrieu to the bill, H.R. 2646, supra; as follows:

       Strike all after the first word, and insert the following:

     101. MODIFICATIONS TO EDUCATION INDIVIDUAL RETIREMENT 
                   ACCOUNTS.

       (a) Tax-Free Expenditures for Elementary and Secondary 
     School Expenses.--
       (1) In general.--Section 530(b)(2) (defining qualified 
     higher education expenses) is amended to read as follows:
       ``(2) Qualified education expenses.--
       ``(A) In general.--The term `qualified education expenses' 
     means--
       ``(i) qualified higher education expenses (as defined in 
     section 529(e)(3)), and
       ``(ii) qualified elementary and secondary education 
     expenses (as defined in paragraph (4)).

[[Page S3455]]

     Such expenses shall be reduced as provided in section 
     25A(g)(2).
       ``(B) Qualified state tuition programs.--Such term shall 
     include amounts paid or incurred to purchase tuition credits 
     or certificates, or to make contributions to an account, 
     under a qualified State tuition program (as defined in 
     section 529(b)) for the benefit of the beneficiary of the 
     account.''
       (2) Qualified elementary and secondary education 
     expenses.--Section 530(b) (relating to definitions and 
     special rules) is amended by adding at the end the following 
     new paragraph:
       ``(4) Qualified elementary and secondary education 
     expenses.--
       ``(A) In general.--The term `qualified elementary and 
     secondary education expenses' means--
       ``(i) expenses for tuition, fees, academic tutoring, 
     special needs services, books, supplies, computer equipment 
     (including related software and services), and other 
     equipment which are incurred in connection with the 
     enrollment or attendance of the designated beneficiary of the 
     trust as an elementary or secondary school student at a 
     public, private, or religious school, or
       ``(ii) expenses for room and board, uniforms, 
     transportation, and supplementary items and services 
     (including extended day programs) which are required or 
     provided by a public, private, or religious school in 
     connection with such enrollment or attendance.
       ``(B) Special rule for homeschooling.--Such term shall 
     include expenses described in subparagraph (A)(i) in 
     connection with education provided by homeschooling if the 
     requirements of any applicable State or local law are met 
     with respect to such education.
       ``(C) School.--The term `school' means any school which 
     provides elementary education or secondary education 
     (kindergarten through grade 12), as determined under State 
     law.''
       (3) Special rules for applying exclusion to elementary and 
     secondary expenses.--Section 530(d)(2) (relating to 
     distributions for qualified higher education expenses) is 
     amended by adding at the end the following new subparagraph:
       ``(D) Special rules for elementary and secondary 
     expenses.--
       ``(i) In general.--The aggregate amount of qualified 
     elementary and secondary education expenses taken into 
     account for purposes of this paragraph with respect to any 
     education individual retirement account for all taxable years 
     shall not exceed the sum of the aggregate contributions to 
     such account for taxable years beginning after December 31, 
     1998, and before January 1, 2003, and earnings on such 
     contributions.
       ``(ii) Special operating rules.--For purposes of clause 
     (i)--

       ``(I) the trustee of an education individual retirement 
     account shall keep separate accounts with respect to 
     contributions and earnings described in clause (i), and
       ``(II) if there are distributions in excess of qualified 
     elementary and secondary education expenses for any taxable 
     year, such excess distributions shall be allocated first to 
     contributions and earnings not described in clause (i).''

       (4) Conforming amendments.--Subsections (b)(1) and (d)(2) 
     of section 530 are each amended by striking ``higher'' each 
     place it appears in the text and heading thereof.
       (b) Maximum Annual Contributions.--
       (1) In general.--Section 530(b)(1)(A)(iii) (defining 
     education individual retirement account) is amended by 
     striking ``$500'' and inserting ``the contribution limit for 
     such taxable year''.
       (2) Contribution limit.--Section 530(b) (relating to 
     definitions and special rules), as amended by subsection 
     (a)(2), is amended by adding at the end the following new 
     paragraph:
       ``(5) Contribution limit.--The term `contribution limit' 
     means $500 ($2,000 in the case of any taxable year beginning 
     after December 31, 1998, and ending before January 1, 
     2003).''
       (3) Conforming amendments.--
       (A) Section 530(d)(4)(C) is amended by striking ``$500'' 
     and inserting ``the contribution limit for such taxable 
     year''.
       (B) Section 4973(e)(1)(A) is amended by striking ``$500'' 
     and inserting ``the contribution limit (as defined in section 
     530(b)(5)) for such taxable year''.
       (c) Waiver of Age Limitations for Children With Special 
     Needs.--Section 530(b)(1) (defining education individual 
     retirement account) is amended by adding at the end the 
     following flush sentence:
     ``The age limitations in the preceding sentence shall not 
     apply to any designated beneficiary with special needs (as 
     determined under regulations prescribed by the Secretary).''
       (d) Corporations Permitted To Contribute to Accounts.--
     Section 530(c)(1) (relating to reduction in permitted 
     contributions based on adjusted gross income) is amended by 
     striking ``The maximum amount which a contributor'' and 
     inserting ``In the case of a contributor who is an 
     individual, the maximum amount the contributor''.
       (e) No Double Benefit.--Section 530(d)(2) (relating to 
     distributions for qualified education expenses), as amended 
     by subsection (a)(3), is amended by adding at the end the 
     following new subparagraph:
       ``(E) Disallowance of excluded amounts as credit or 
     deduction.--No deduction or credit shall be allowed to the 
     taxpayer under any other section of this chapter for any 
     qualified education expenses to the extent taken into account 
     in determining the amount of the exclusion under this 
     paragraph.''
       (f) Technical Corrections.--
       (1)(A) Section 530(b)(1)(E) (defining education individual 
     retirement account) is amended to read as follows:
       ``(E) Any balance to the credit of the designated 
     beneficiary on the date on which the beneficiary attains age 
     30 shall be distributed within 30 days after such date to the 
     beneficiary or, if the beneficiary dies before attaining age 
     30, shall be distributed within 30 days after the date of 
     death to the estate of such beneficiary.''
       (B) Section 530(d) (relating to tax treatment of 
     distributions) is amended by adding at the end the following 
     new paragraph:
       ``(8) Deemed distribution on required distribution date.--
     In any case in which a distribution is required under 
     subsection (b)(1)(E), any balance to the credit of a 
     designated beneficiary as of the close of the 30-day period 
     referred to in such subsection for making such distribution 
     shall be deemed distributed at the close of such period.''
       (2)(A) Section 530(d)(1) is amended by striking ``section 
     72(b)'' and inserting ``section 72''.
       (B) Section 72(e) (relating to amounts not received as 
     annuities) is amended by inserting after paragraph (8) the 
     following new paragraph:
       ``(9) Extension of paragraph (2)(b) to qualified state 
     tuition programs and educational individual retirement 
     accounts.--Notwithstanding any other provision of this 
     subsection, paragraph (2)(B) shall apply to amounts received 
     under a qualified State tuition program (as defined in 
     section 529(b)) or under an education individual retirement 
     account (as defined in section 530(b)). The rule of paragraph 
     (8)(B) shall apply for purposes of this paragraph.''
       (3) Section 530(d)(4)(B) (relating to exceptions) is 
     amended by striking ``or'' at the end of clause (ii), by 
     striking the period at the end of clause (iii) and inserting 
     ``, or'', and by adding at the end the following new clause:
       ``(iv) an amount which is includible in gross income solely 
     because the taxpayer elected under paragraph (2)(C) to waive 
     the application of paragraph (2) for the taxable year.''
       (g) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to taxable years 
     beginning after December 31, 1998.
       (2) Technical corrections.--The amendments made by 
     subsection (f) shall take effect as if included in the 
     amendments made by section 213 of the Taxpayer Relief Act of 
     1997.

     SEC. 102. STUDENT IMPROVEMENT INCENTIVE AWARDS.

       Section 6201 of the Elementary and Secondary Education Act 
     of 1965 (20 U.S.C. 7331) is amended--
       (1) in subsection (a)--
       (A) in paragraph (1)(C), by striking ``and'' after the 
     semicolon;
       (B) in paragraph (2), by striking the period and inserting 
     ``; and''; and
       (C) by adding at the end the following:
       ``(3) student improvement incentive awards described in 
     subsection (c).''; and
       (2) by adding at the end the following:
       ``(c) Student Improvement Incentive Awards.--
       ``(1) Awards.--A State educational agency may use funds 
     made available for State use under this title to make awards 
     to public secondary schools in the State that are determined 
     to be outstanding schools pursuant to a statewide assessment 
     described in paragraph (2).
       ``(2) Statewide assessment.--The statewide assessment 
     referred to in paragraph (1)--
       ``(A) shall--
       ``(i) determine the educational progress of students 
     attending public secondary schools within the State; and
       ``(ii) allow for an objective analysis of the assessment on 
     a school-by-school basis; and
       ``(B) may involve exit exams.''.
                                 ______
                                 

                LEVIN (AND BINGAMAN) AMENDMENT NO. 2303

  Mr. LEVIN (for himself and Mr. Bingaman) proposed an amendment to 
amendment No. 2299 proposed by Mr. Levin to the bill, H.R. 2646, supra; 
as follows:

       At the end of the amendment add the following:
       Section 101 is null and void.

     SEC.   . MODIFICATIONS TO EDUCATION INDIVIDUAL RETIREMENT 
                   ACCOUNTS.

       (a) Maximum Annual Contributions.--
       (1) In general.--Section 530(b)(1)(A)(iii) (defining 
     education individual retirement account) is amended by 
     striking ``$500'' and inserting ``the contribution limit for 
     such taxable year''.
       (2) Contribution limit.--Section 530(b) (relating to 
     definitions and special rules) is amended by adding at the 
     end the following new paragraph:
       ``(4) Contribution limit.--The term `contribution limit' 
     means $500 ($2,000 in the case of any taxable year beginning 
     after December 31, 1998, and ending before January 1, 
     2003).''
       (3) Conforming amendments.--
       (A) Section 530(d)(4)(C) is amended by striking ``$500'' 
     and inserting ``the contribution limit for such taxable 
     year''.

[[Page S3456]]

       (B) Section 4973(e)(1)(A) is amended by striking ``$500'' 
     and inserting ``the contribution limit (as defined in section 
     530(b)(5)) for such taxable year''.
       (b) Waiver of Age Limitations for Children With Special 
     Needs.--Section 530(b)(1) (defining education individual 
     retirement account) is amended by adding at the end the 
     following flush sentence:
     ``The age limitations in the preceding sentence shall not 
     apply to any designated beneficiary with special needs (as 
     determined under regulations prescribed by the Secretary).''
       (c) Corporations Permitted To Contribute to Accounts.--
     Section 530(c)(1) (relating to reduction in permitted 
     contributions based on adjusted gross income) is amended by 
     striking ``The maximum amount which a contributor'' and 
     inserting ``In the case of a contributor who is an 
     individual, the maximum amount the contributor''.
       (d) No Double Benefit.--Section 530(d)(2) (relating to 
     distributions for qualified education expenses) is amended by 
     adding at the end the following new subparagraph:
       ``(D) Disallowance of excluded amounts as credit or 
     deduction.--No deduction or credit shall be allowed to the 
     taxpayer under any other section of this chapter for any 
     qualified education expenses to the extent taken into account 
     in determining the amount of the exclusion under this 
     paragraph.''
       (e) Technical Corrections.--
       (1)(A) Section 530(b)(1)(E) (defining education individual 
     retirement account) is amended to read as follows:
       ``(E) Any balance to the credit of the designated 
     beneficiary on the date on which the beneficiary attains age 
     30 shall be distributed within 30 days after such date to the 
     beneficiary or, if the beneficiary dies before attaining age 
     30, shall be distributed within 30 days after the date of 
     death to the estate of such beneficiary.''
       (B) Section 530(d) (relating to tax treatment of 
     distributions) is amended by adding at the end the following 
     new paragraph:
       ``(8) Deemed distribution on required distribution date.--
     In any case in which a distribution is required under 
     subsection (b)(1)(E), any balance to the credit of a 
     designated beneficiary as of the close of the 30-day period 
     referred to in such subsection for making such distribution 
     shall be deemed distributed at the close of such period.''
       (2)(A) Section 530(d)(1) is amended by striking ``section 
     72(b)'' and inserting ``section 72''.
       (B) Section 72(e) (relating to amounts not received as 
     annuities) is amended by inserting after paragraph (8) the 
     following new paragraph:
       ``(9) Extension of paragraph (2)(b) to qualified state 
     tuition programs and educational individual retirement 
     accounts.--Notwithstanding any other provision of this 
     subsection, paragraph (2)(B) shall apply to amounts received 
     under a qualified State tuition program (as defined in 
     section 529(b)) or under an education individual retirement 
     account (as defined in section 530(b)). The rule of paragraph 
     (8)(B) shall apply for purposes of this paragraph.''
       (3) Section 530(d)(4)(B) (relating to exceptions) is 
     amended by striking ``or'' at the end of clause (ii), by 
     striking the period at the end of clause (iii) and inserting 
     ``, or'', and by adding at the end the following new clause:
       ``(iv) an amount which is includible in gross income solely 
     because the taxpayer elected under paragraph (2)(C) to waive 
     the application of paragraph (2) for the taxable year.''
       (f) Effective Dates.--
       (1) In general.--Except as provided in paragraph (2), the 
     amendments made by this section shall apply to taxable years 
     beginning after December 31, 1998.
       (2) Technical corrections.--The amendments made by 
     subsection (e) shall take effect as if included in the 
     amendments made by section 213 of the Taxpayer Relief Act of 
     1997.
       On page 21, between lines 9 and 10, insert:

     SEC. 107. INCREASED LIFETIME LEARNING CREDIT FOR TECHNOLOGY 
                   TRAINING OF ELEMENTARY AND SECONDARY TEACHERS.

       (a) In General.--Section 25A(c) (relating to lifetime 
     learning credit) is amended by adding at the end the 
     following new paragraph:
       ``(3) Special rule for technology training of certain 
     teachers.--
       ``(A) In general.--If any portion of the qualified tuition 
     and related expenses to which this subsection applies--
       ``(i) are paid or incurred by an individual who is a 
     kindergarten through grade 12 teacher in an elementary or 
     secondary school, and
       ``(ii) are incurred as part of a program which is approved 
     and certified by the appropriate local educational agency as 
     directly related to improvement of the individual's capacity 
     to use technology in teaching,
     paragraph (1) shall be applied with respect to such portion 
     by substituting `50 percent' for `20 percent'.
       ``(B) Termination.--This paragraph shall not apply to 
     expenses paid after December 31, 2002, for education 
     furnished in academic periods beginning after such date.''
       (b) Effective Date.--The amendment made by this section 
     shall apply to expenses paid after June 30, 1998, for 
     education furnished in academic periods beginning after such 
     date.

                          ____________________