[Congressional Record Volume 144, Number 102 (Monday, July 27, 1998)]
[Senate]
[Pages S9067-S9087]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




 COMMUNITY OPPORTUNITIES, ACCOUNTABILITY, AND TRAINING AND EDUCATIONAL 
                          SERVICES ACT OF 1998

  Mr. HATCH. Mr. President, I ask unanimous consent that the Senate now 
proceed to the consideration of Calendar No. 483, S. 2206.
  The PRESIDING OFFICER. The clerk will report.
  The bill clerk read as follows:

       A bill (S. 2206) to amend the Head Start Act, the Low-
     Income Home Energy Assistance Act of 1981, and the Community 
     Services Block Grant to reauthorize and make improvements to 
     those Acts, to establish demonstration projects that provide 
     an opportunity for persons with limited means to accumulate 
     assets, and for other purposes.

  The PRESIDING OFFICER. Is there objection to the immediate 
consideration of the bill?
  There being no objection, the Senate proceeded to consider the bill, 
which had been reported from the Committee on Labor and Human 
Resources, with an amendment to strike all after the enacting clause 
and inserting in lieu thereof the following:

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Community Opportunities, 
     Accountability, and Training and Educational Services Act of 
     1998'' or the ``Coats Human Services Reauthorization Act of 
     1998''.

     SEC. 2. TABLE OF CONTENTS.

       The table of contents for this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.

                      TITLE I--HEAD START PROGRAMS

Sec. 101. Short title.
Sec. 102. References.
Sec. 103. Statement of purpose.
Sec. 104. Definitions.
Sec. 105. Financial assistance for Head Start programs.
Sec. 106. Authorization of appropriations.
Sec. 107. Allotment of funds.
Sec. 108. Designation of Head Start agencies.
Sec. 109. Quality standards.
Sec. 110. Powers and functions of Head Start agencies.
Sec. 111. Head Start transition.
Sec. 112. Submission of plans to Governors.
Sec. 113. Participation in Head Start programs.
Sec. 114. Early Head Start programs for families with infants and 
              toddlers.
Sec. 115. Technical assistance and training.
Sec. 116. Staff qualifications and development.
Sec. 117. Research, demonstration, and evaluation.
Sec. 118. Repeal.

            TITLE II--COMMUNITY SERVICES BLOCK GRANT PROGRAM

Sec. 201. Reauthorization.
Sec. 202. Conforming amendments.
Sec. 203. Repealers.

              TITLE III--LOW-INCOME HOME ENERGY ASSISTANCE

Sec. 301. Authorization.
Sec. 302. Definitions.
Sec. 303. Natural disasters and other emergencies.
Sec. 304. State allotments.
Sec. 305. Administration.
Sec. 306. Payments to States.
Sec. 307. Residential Energy Assistance Challenge option.
Sec. 308. Technical assistance, training, and compliance reviews.

                   TITLE IV--ASSETS FOR INDEPENDENCE

Sec. 401. Short title.
Sec. 402. Findings.

[[Page S9068]]

Sec. 403. Purposes.
Sec. 404. Definitions.
Sec. 405. Applications.
Sec. 406. Demonstration authority; annual grants.
Sec. 407. Reserve Fund.
Sec. 408. Eligibility for participation.
Sec. 409. Selection of individuals to participate.
Sec. 410. Deposits by qualified entities.
Sec. 411. Local control over demonstration projects.
Sec. 412. Annual progress reports.
Sec. 413. Sanctions.
Sec. 414. Evaluations.
Sec. 415. Treatment of funds.
Sec. 416. Authorization of appropriations.

                      TITLE I--HEAD START PROGRAMS

     SEC. 101. SHORT TITLE.

       This title may be cited as the ``Head Start Amendments of 
     1998''.

     SEC. 102. REFERENCES.

       Except as otherwise expressly provided, wherever in this 
     title an amendment or repeal is expressed in terms of an 
     amendment to, or repeal of, a section or other provision, the 
     reference shall be considered to be made to a section or 
     other provision of the Head Start Act (42 U.S.C. 9831 et 
     seq.).

     SEC. 103. STATEMENT OF PURPOSE.

       The Head Start Act is amended by striking section 636 (42 
     U.S.C. 9831) and inserting the following:

     ``SEC. 636. STATEMENT OF PURPOSE.

       ``It is the purpose of this subchapter to promote school 
     readiness by enhancing the social and cognitive development 
     of low-income children through the provision, to low-income 
     children and their families, of health, educational, 
     nutritional, social, and other services that are determined 
     to be necessary, based on family needs assessments.''.

     SEC. 104. DEFINITIONS.

       Section 637 (42 U.S.C. 9832) is amended--
       (1) by redesignating paragraphs (5) through (14) as 
     paragraphs (7) through (16), respectively;
       (2) by redesignating paragraph (3) as paragraph (6) and 
     inserting such paragraph after paragraph (4);
       (3) by striking paragraph (4) and inserting the following:
       ``(3) The term `child with a disability' means--
       ``(A) a child with a disability, as defined in section 
     602(3) of the Individuals with Disabilities Education Act; 
     and
       ``(B) an infant or toddler with a disability, as defined in 
     section 632(5) of such Act.
       ``(4) The term `delegate agency' means a public, private 
     nonprofit, or for-profit organization or agency to which a 
     grantee has delegated all or part of the responsibility of 
     the grantee for operating a Head Start program.
       ``(5) The term `family literacy services' means services 
     that--
       ``(A) are provided to participants who receive the services 
     on a voluntary basis;
       ``(B) are of sufficient intensity, and of sufficient 
     duration, to make sustainable changes in a family (such as 
     eliminating or reducing dependence on income-based public 
     assistance); and
       ``(C) integrate each of--
       ``(i) interactive literacy activities between parents and 
     their children;
       ``(ii) training for parents on being partners with their 
     children in learning;
       ``(iii) parent literacy training, including training that 
     contributes to economic self-sufficiency; and
       ``(iv) appropriate instruction for children of parents 
     receiving the parent literacy training.'';
       (4) in paragraph (8) (as redesignated in paragraph (1)), by 
     adding at the end the following: ``Nothing in this paragraph 
     shall be construed to require an agency to provide services 
     to a child who has not reached the age of compulsory school 
     attendance for more than the number of hours per day 
     permitted by State law (including regulation) for the 
     provision of services to such a child.'';
       (5) by striking paragraph (14) (as redesignated in 
     paragraph (1)) and inserting the following:
       ``(14) The term `migrant or seasonal Head Start program' 
     means--
       ``(A) with respect to services for migrant farmworkers, a 
     Head Start program that serves families who are engaged in 
     agricultural labor and who have changed their residence from 
     one geographic location to another in the preceding 2-year 
     period; and
       ``(B) with respect to services for seasonal farmworkers, a 
     Head Start program that serves families who are engaged 
     primarily in seasonal agricultural labor and who have not 
     changed their residence to another geographic location in the 
     preceding 2-year period.''; and
       (6) by adding at the end the following:
       ``(17) The term `reliable and replicable', used with 
     respect to research, means an objective, valid, scientific 
     study that--
       ``(A) includes a rigorously defined sample of subjects, 
     that is sufficiently large and representative to support the 
     general conclusions of the study;
       ``(B) relies on measurements that meet established 
     standards of reliability and validity;
       ``(C) is subjected to peer review before the results of the 
     study are published; and
       ``(D) discovers effective strategies for enhancing the 
     development and skills of children.''.

     SEC. 105. FINANCIAL ASSISTANCE FOR HEAD START PROGRAMS.

       Section 638(1) (42 U.S.C. 9833(1)) is amended--
       (1) by striking ``aid the'' and inserting ``enable the''; 
     and
       (2) by striking the semicolon and inserting ``and attain 
     school readiness;''.

     SEC. 106. AUTHORIZATION OF APPROPRIATIONS.

       Section 639 (42 U.S.C. 9834) is amended--
       (1) in subsection (a), by striking ``1995 through 1998'' 
     and inserting ``1999 through 2003''; and
       (2) in subsection (b), by striking all that follows ``shall 
     make available--'' and inserting the following:
       ``(1) for each of fiscal years 1999 through 2003 to carry 
     out activities authorized under section 642A, not more than 
     $35,000,000 but not less than was made available for such 
     activities for fiscal year 1998;
       ``(2) not more than $5,000,000 for each of fiscal years 
     1999 through 2003 to carry out impact studies under section 
     649(g); and
       ``(3) not more than $12,000,000 for fiscal year 1999, and 
     such sums as may be necessary for each of fiscal years 2000 
     through 2003, to carry out other research, demonstration, and 
     evaluation activities, including longitudinal studies, under 
     section 649.''.

     SEC. 107. ALLOTMENT OF FUNDS.

       (a) Allotments.--Section 640(a) (42 U.S.C. 9835(a)) is 
     amended--
       (1) in paragraph (2)--
       (A) in subparagraph (A)--
       (i) by striking ``handicapped children'' and inserting 
     ``children with disabilities'';
       (ii) by striking ``migrant Head Start programs'' each place 
     it appears and inserting ``migrant or seasonal Head Start 
     programs''; and
       (iii) by striking ``1994'' and inserting ``1998'';
       (B) in subparagraph (C), by striking ``and'' at the end;
       (C) in subparagraph (D), by striking ``related to the 
     development and implementation of quality improvement plans 
     under section 641A(d)(2).'' and inserting ``carried out under 
     paragraph (1), (2), or (3) of section 641A(d) related to 
     correcting deficiencies and conducting proceedings to 
     terminate the designation of Head Start agencies; and'';
       (D) by inserting after subparagraph (D) the following:
       ``(E) payments for research, demonstration, and evaluation 
     activities under section 649.''; and
       (E) by adding at the end the following: ``In determining 
     the need and demand for migrant and seasonal Head Start 
     programs, and services provided through such programs, the 
     Secretary shall consult with appropriate entities, including 
     providers of services for seasonal and migrant Head Start 
     programs. The Secretary shall, after taking into 
     consideration the need and demand for migrant and seasonal 
     Head Start programs, and such services, ensure that there is 
     an adequate level of such services for the children of 
     eligible migrant farmworkers before approving an increase in 
     the allocation provided for children of eligible seasonal 
     farmworkers. In carrying out this subchapter, the Secretary 
     shall continue the administrative arrangement responsible for 
     meeting the needs of migrant or seasonal farmworker and 
     Indian children and shall assure that appropriate funding is 
     provided to meet such needs.'';
       (2) in paragraph (3)--
       (A) in subparagraph (B)--
       (i) in clause (ii)--

       (I) by striking ``adequate qualified staff'' and inserting 
     ``adequate numbers of qualified staff''; and
       (II) by inserting ``and children with disabilities'' before 
     ``, when'';

       (ii) in clause (iv), by inserting before the period the 
     following: ``, and to encourage the staff to continually 
     improve their skills and expertise by informing the staff of 
     the availability of Federal and State incentive and loan 
     forgiveness programs for professional development and by 
     providing for preferences in the awarding of salary 
     increases, in excess of cost-of-living allowances, to staff 
     who obtain additional training or education related to their 
     responsibilities as employees of a Head Start program or to 
     advance their careers within the Head Start program'';
       (iii) in clause (vi), by striking the period and inserting 
     ``, and are physically accessible to children with 
     disabilities and their parents.'';
       (iv) by redesignating clause (vii) as clause (viii); and
       (v) by inserting after clause (vi) the following:
       ``(vii) Ensuring that such programs have qualified staff 
     that can promote language skills and literacy growth of 
     children and that can provide children with a variety of 
     skills that have been identified, through research that is 
     reliable and replicable, as predictive of later reading 
     achievement.'';
       (B) in subparagraph (C)--
       (i) in clause (i)(I)--

       (I) by striking ``of staff'' and inserting ``of classroom 
     teachers and other staff''; and
       (II) by striking ``such staff'' and inserting ``qualified 
     staff, including recruitment and retention pursuant to 
     section 648A(a)'';

       (ii) by striking clause (ii) and inserting the following:
       ``(ii) To supplement amounts provided under paragraph 
     (2)(C) to provide training to classroom teachers and other 
     staff on proven techniques that promote--
       ``(I) language and literacy growth; and
       ``(II) the acquisition of the English language for non-
     English background children and families.'';
       (iii) in clause (v), by inserting ``accessibility or'' 
     before ``availability'';
       (iv) by redesignating clauses (iii), (iv), (v), and (vi) as 
     clauses (iv), (v), (vi), and (iii), respectively; and
       (v) by inserting clause (iii) (as redesignated in clause 
     (iv) of this subparagraph) after clause (ii); and
       (C) in subparagraph (D)(i)(II), by striking ``migrant Head 
     Start programs'' and inserting ``migrant or seasonal Head 
     Start programs'';
       (3) in paragraph (4)(A), by striking ``1981'' and inserting 
     ``1998'';
       (4) in paragraph (5)--
       (A) in subparagraph (A), by striking ``subparagraph (B)'' 
     and inserting ``subparagraphs (B) and (D)'';
       (B) in subparagraph (B), by inserting before the period the 
     following: ``and to encourage

[[Page S9069]]

     Head Start agencies to collaborate with entities involved in 
     State and local planning processes (including the State lead 
     agency administering the financial assistance received under 
     the Child Care and Development Block Grant Act of 1990 (42 
     U.S.C. 9858 et seq.) and the entities providing resource and 
     referral services in the State) in order to better meet the 
     needs of low-income children and families'';
       (C) in subparagraph (C)--
       (i) in clause (i)(I), by inserting ``the appropriate 
     regional office of the Administration for Children and 
     Families and'' before ``agencies'';
       (ii) in clause (iii), by striking ``and'' at the end;
       (iii) in clause (iv)--

       (I) by striking ``education, and national service 
     activities,'' and inserting ``education, and community 
     service activities,'';
       (II) by striking ``and activities'' and inserting 
     ``activities''; and
       (III) by striking the period and inserting ``, and services 
     for homeless children; and''; and

       (iv) by adding at the end the following:
       ``(v) include representatives of the State Head Start 
     Association and local Head Start agencies in unified planning 
     regarding early care and education services at both the State 
     and local levels, including collaborative efforts to plan for 
     the provision of full-working-day, full calendar year early 
     care and education services for children.'';
       (D) by redesignating subparagraph (D) as subparagraph (F); 
     and
       (E) by inserting after subparagraph (C) the following:
       ``(D) Following the award of collaboration grants described 
     in subparagraph (B), the Secretary shall provide, from the 
     reserved sums, supplemental funding for collaboration 
     grants--
       ``(i) to States that (in consultation with their State Head 
     Start Associations) develop statewide, regional, or local 
     unified plans for early childhood education and child care 
     that include the participation of Head Start agencies; and
       ``(ii) to States that engage in other innovative 
     collaborative initiatives, including plans for collaborative 
     training and career development initiatives for child care, 
     early childhood education, and Head Start service managers, 
     providers, and staff.
       ``(E)(i) The Secretary shall--
       ``(I) review on an ongoing basis evidence of barriers to 
     effective collaboration between Head Start programs and other 
     Federal child care and early childhood education programs and 
     resources;
       ``(II) develop initiatives, including providing additional 
     training and technical assistance and making regulatory 
     changes, in necessary cases, to eliminate barriers to the 
     collaboration; and
       ``(III) develop a mechanism to resolve administrative and 
     programmatic conflicts between such programs that would be a 
     barrier to service providers, parents, or children related to 
     the provision of unified services and the consolidation of 
     funding for child care services.
       ``(ii) In the case of a collaborative activity funded under 
     this subchapter and another provision of law providing for 
     Federal child care or early childhood education, the use of 
     equipment and nonconsumable supplies purchased with funds 
     made available under this subchapter or such provision shall 
     not be restricted to children enrolled or otherwise 
     participating in the program carried out under that 
     subchapter or provision, during a period in which the 
     activity is predominantly funded under this subchapter or 
     such provision.''; and
       (5) in paragraph (6)--
       (A) by inserting ``(A)'' before ``From''; and
       (B) by striking ``3 percent'' and all that follows and 
     inserting the following: ``7.5 percent for fiscal year 1999, 
     8 percent for fiscal year 2000, 9 percent for fiscal year 
     2001, 10 percent for fiscal year 2002, and 10 percent for 
     fiscal year 2003, of the amount appropriated pursuant to 
     section 639(a), except as provided in subparagraph (B).
       ``(B)(i) For any fiscal year for which the Secretary 
     determines that the amount appropriated under section 639(a) 
     is not sufficient to permit the Secretary to reserve the 
     portion described in subparagraph (A) without reducing the 
     number of children served by Head Start programs or adversely 
     affecting the quality of Head Start services, relative to the 
     number of children served and the quality of the services 
     during the preceding fiscal year, the Secretary may reduce 
     the percentage of funds required to be reserved for the 
     portion described in subparagraph (A) for the fiscal year for 
     which the determination is made, but not below the percentage 
     required to be so reserved for the preceding fiscal year.
       ``(ii) For any fiscal year for which the amount 
     appropriated under section 639(a) is reduced to a level that 
     requires a lower amount to be made available under this 
     subchapter to Head Start agencies and entities described in 
     section 645A, relative to the amount made available to the 
     agencies and entities for the preceding fiscal year, adjusted 
     as described in paragraph (3)(A)(ii), the Secretary shall 
     proportionately reduce--
       ``(I) the amounts made available to the entities for 
     programs carried out under section 645A; and
       ``(II) the amounts made available to Head Start agencies 
     for Head Start programs.''.
       (b) Children With Disabilities.--Section 640(d) (42 U.S.C. 
     9835(d)) is amended--
       (1) by striking ``1982'' and inserting ``1999''; and
       (2) by striking ``(as defined in section 602(a) of the 
     Individuals with Disabilities Education Act)''.
       (c) Increased Appropriations.--Section 640(g) (42 U.S.C. 
     9835(g)) is amended--
       (1) in paragraph (2)--
       (A) in subparagraph (A), by striking the semicolon and 
     inserting ``, and the performance history of the applicant in 
     providing services under other Federal programs (other than 
     the program carried out under this subchapter);'';
       (B) in subparagraph (C), by striking ``spoken);'' and 
     inserting ``spoken, and organizations serving children with 
     disabilities);'';
       (C) in subparagraph (D), by inserting before the semicolon 
     the following: ``and the extent to which, and manner in 
     which, the applicant demonstrates the ability to collaborate 
     and participate with other local community providers of child 
     care or preschool services to provide full-working-day, full 
     calendar year services'';
       (D) in subparagraph (E), by striking ``program; and'' and 
     inserting ``program or any other early childhood program;'';
       (E) in subparagraph (F), by striking the period and 
     inserting ``; and''; and
       (F) by adding at the end the following:
       ``(G) the extent to which the applicant proposes to foster 
     partnerships with other service providers in a manner that 
     will enhance the resource capacity of the applicant.''; and
       (2) by adding at the end the following:
       ``(4) Notwithstanding subsection (a)(2), after taking into 
     account the provisions of paragraph (1), the Secretary may 
     allocate a portion of the remaining additional funds under 
     subsection (a)(2)(A) for the purpose of increasing funds 
     available for the activities described in such subsection.''.
       (d) Migrant or Seasonal Head Start Programs.--Section 
     640(l) (42 U.S.C. 9835(l)) is amended--
       (1) by striking ``migrant Head Start programs'' each place 
     it appears and inserting ``migrant or seasonal Head Start 
     programs''; and
       (2) by striking ``migrant families'' and inserting 
     ``migrant or seasonal farmworker families''.
       (e) Conforming Amendment.--Section 644(f)(2) (42 U.S.C. 
     9839(f)(2)) is amended by striking ``640(a)(3)(C)(v)'' and 
     inserting ``640(a)(3)(C)(vi)''.

     SEC. 108. DESIGNATION OF HEAD START AGENCIES.

       Section 641 (42 U.S.C. 9836) is amended--
       (1) in subsection (a)--
       (A) in the matter preceding paragraph (1), by inserting 
     ``or for-profit'' after ``nonprofit''; and
       (B) in paragraph (2), by inserting ``(in consultation with 
     the chief executive officer of the State in which the 
     community is located)'' after ``the Secretary'';
       (2) in subsection (c)--
       (A) in paragraph (1)--
       (i) by striking ``shall give priority'' and inserting 
     ``shall, in consultation with the chief executive officer of 
     the State, give priority'';
       (ii) by inserting ``or for-profit'' after ``nonprofit''; 
     and
       (iii) by striking ``unless the Secretary makes a finding'' 
     and all that follows and inserting the following: ``unless 
     the Secretary determines that the agency involved fails to 
     meet program and financial management requirements, 
     performance standards described in section 641A(a)(1), or 
     other requirements established by the Secretary.'';
       (B) in paragraph (2), by striking ``shall give priority'' 
     and inserting ``shall, in consultation with the chief 
     executive officer of the State, give priority''; and
       (C) by aligning the margins of paragraphs (2) and (3) with 
     the margins of paragraph (1);
       (3) in subsection (d)--
       (A) in the matter preceding paragraph (1), by inserting 
     after the first sentence the following new sentence: ``In 
     selecting from among qualified applicants for designation as 
     a Head Start agency, the Secretary shall give priority to 
     any qualified agency that functioned as a delegate agency 
     in the community and carried out a Head Start program that 
     the Secretary determines has met or exceeded the 
     performance standards and outcome-based performance 
     measures described in section 641A.'';
       (B) in paragraph (4)(A), by inserting ``(at home and in the 
     center involved where practicable)'' after ``activities'';
       (C) by redesignating paragraphs (7) and (8) as paragraphs 
     (9) and (10), respectively; and
       (D) by inserting after paragraph (6) the following:
       ``(7) the plan of such applicant to meet the needs of non-
     English background children and their families, including 
     needs related to the acquisition of the English language;
       ``(8) the plan of such applicant to meet the needs of 
     children with disabilities;'';
       (4) by striking subsection (e) and inserting the following:
       ``(e) If no agency in the community receives priority 
     designation under subsection (c), and there is no qualified 
     applicant in the community, the Secretary shall designate a 
     qualified agency to carry out the Head Start program in the 
     community on an interim basis until a qualified applicant 
     from the community is so designated.''; and
       (5) by adding at the end the following:
       ``(g) If the Secretary determines that a nonprofit agency 
     and a for-profit agency have submitted applications for 
     designation of equivalent quality under subsection (d), the 
     Secretary may give priority to the nonprofit agency.''.

     SEC. 109. QUALITY STANDARDS.

       (a) Quality Standards.--Section 641A(a) (42 U.S.C. 
     9836a(a)) is amended--
       (1) in paragraph (1)--
       (A) in the matter preceding subparagraph (A), by inserting 
     ``, including minimum levels of overall accomplishment,'' 
     after ``regulation standards'';
       (B) in subparagraph (A), by striking ``education,'';
       (C) by redesignating subparagraphs (B) through (D) as 
     subparagraphs (C) through (E), respectively; and
       (D) by inserting after subparagraph (A) the following:
       ``(B)(i) education performance standards to ensure the 
     school readiness of children participating in a Head Start 
     program, on completion

[[Page S9070]]

     of the Head Start program and prior to entering school; and
       ``(ii) additional education performance standards to ensure 
     that the children participating in the program, at a 
     minimum--
       ``(I) develop phonemic, print, and numeracy awareness;
       ``(II) understand and use oral language to communicate 
     needs, wants, and thoughts;
       ``(III) understand and use increasingly complex and varied 
     vocabulary;
       ``(IV) develop and demonstrate an appreciation of books; 
     and
       ``(V) in the case of non-English background children, 
     progress toward acquisition of the English language.'';
       (2) by striking paragraph (2);
       (3) by redesignating paragraphs (3) and (4) as paragraphs 
     (2) and (3), respectively;
       (4) in paragraph (2) (as redesignated in paragraph (3))--
       (A) in subparagraph (B)(iii), by striking ``child'' and 
     inserting ``early childhood education and''; and
       (B) in subparagraph (C)--
       (i) in clause (i)--

       (I) by striking ``not later than 1 year after the date of 
     enactment of this section,''; and
       (II) by striking ``section 651(b)'' and all that follows 
     and inserting ``this subsection; and''; and

       (ii) in subclause (ii), by striking ``November 2, 1978'' 
     and inserting ``the date of enactment of the Coats Human 
     Services Reauthorization Act of 1998''; and
       (5) in paragraph (3) (as redesignated in paragraph (3)), by 
     striking ``to an agency (referred to in this subchapter as 
     the ``delegate agency'')'' and inserting ``to a delegate 
     agency''.
       (b) Performance Measures.--Section 641A(b) (42 U.S.C. 
     9836a(b)) is amended--
       (1) in the subsection heading, by inserting ``Outcome-
     Based'' before ``Performance'';
       (2) in paragraph (1)--
       (A) by striking ``Not later than 1 year after the date of 
     enactment of this section, the'' and inserting ``The'';
       (B) by striking ``child'' and inserting ``early childhood 
     education and'';
       (C) by striking ``(referred'' and inserting ``, and the 
     impact of the services provided through the programs to 
     children and their families (referred'';
       (D) by striking ``performance measures'' and inserting 
     ``outcome-based performance measures''; and
       (E) by adding at the end the following: ``The performance 
     measures shall include the performance standards described in 
     subsection (a)(1)(B)(ii).''; and
       (3) in paragraph (2)--
       (A) in the paragraph heading, by striking ``Design'' and 
     inserting ``Characteristics'';
       (B) in the matter preceding subparagraph (A), by striking 
     ``shall be designed--'' and inserting ``shall--'';
       (C) in subparagraph (A), by striking ``to assess'' and 
     inserting ``be used to assess the impact of'';
       (D) in subparagraph (B)--
       (i) by striking ``to''; and
       (ii) by striking ``and peer review'' and inserting ``, peer 
     review, and program evaluation''; and
       (E) in subparagraph (C), by inserting ``be developed'' 
     before ``for other''.
       (c) Monitoring.--Section 641A(c)(2) (42 U.S.C. 9836a(c)(2)) 
     is amended--
       (1) in subparagraph (B), by striking ``; and'' and 
     inserting a semicolon;
       (2) in subparagraph (C)--
       (A) by inserting ``(including children with disabilities)'' 
     after ``eligible children''; and
       (B) by striking the period and inserting ``; and''; and
       (3) by adding at the end the following:
       ``(D) as part of the reviews of the programs, include a 
     review and assessment of program effectiveness, as measured 
     in accordance with the outcome-based performance measures 
     developed pursuant to subsection (b) and with the performance 
     standards established pursuant to subparagraphs (A) and (B) 
     of subsection (a)(1).''.
       (d) Termination.--Section 641A(d) (42 U.S.C. 9836a(d)) is 
     amended--
       (1) in paragraph (1)(B), to read as follows:
       ``(B) with respect to each identified deficiency, require 
     the agency--
       ``(i) to correct the deficiency immediately, if the 
     Secretary finds that the deficiency threatens the health or 
     safety of staff or program participants or poses a threat to 
     the integrity of Federal funds;
       ``(ii) to correct the deficiency not later than 90 days 
     after the identification of the deficiency if the Secretary 
     finds, in the discretion of the Secretary, that such a 90-day 
     period is reasonable, in light of the nature and magnitude of 
     the deficiency; or
       ``(iii) in the discretion of the Secretary (taking into 
     consideration the seriousness of the deficiency and the time 
     reasonably required to correct the deficiency), to comply 
     with the requirements of paragraph (2) concerning a quality 
     improvement plan; and''; and
       (2) in paragraph (2)(A), in the matter preceding clause 
     (i), by striking ``able to correct a deficiency immediately'' 
     and inserting ``required to correct a deficiency immediately 
     or during a 90-day period under clause (i) or (ii) of 
     paragraph (1)(B)''.

     SEC. 110. POWERS AND FUNCTIONS OF HEAD START AGENCIES.

       Section 642 (42 U.S.C. 9837) is amended--
       (1) in subsection (a), by inserting ``or for-profit'' after 
     ``nonprofit'';
       (2) in subsection (c)--
       (A) by inserting ``and collaborate'' after ``coordinate''; 
     and
       (B) by striking ``section 402(g) of the Social Security 
     Act, and other'' and inserting ``the State program carried 
     out under the Child Care and Development Block Grant Act of 
     1990 (42 U.S.C. 9858 et seq.), and other early childhood 
     education and development''; and
       (3) in subsection (d)--
       (A) in paragraph (1)--
       (i) by striking ``shall carry out'' and all that follows 
     through ``maintain'' and inserting ``shall take steps to 
     ensure, to the maximum extent possible, that children 
     maintain'';
       (ii) by striking ``developmental'' and inserting 
     ``developmental and educational''; and
       (iii) by striking ``to build'' and inserting ``build'';
       (B) by striking paragraph (2);
       (C) by redesignating paragraphs (3) through (5) as 
     paragraphs (2) through (4), respectively; and
       (D) in subparagraph (A) of paragraph (4) (as redesignated 
     in subparagraph (C)), by striking ``the Head Start Transition 
     Project Act (42 U.S.C. 9855 et seq.)'' and inserting 
     ``section 642A''.

     SEC. 111. HEAD START TRANSITION.

       The Head Start Act (42 U.S.C. 9831 et seq.) is amended by 
     inserting after section 642 the following:

     ``SEC. 642A. HEAD START TRANSITION.

       ``Each Head Start agency shall take steps to coordinate 
     with the local educational agency serving the community 
     involved and with schools in which children participating in 
     a Head Start program operated by such agency will enroll 
     following such program, including--
       ``(1) developing and implementing a systematic procedure 
     for transferring, with parental consent, Head Start program 
     records for each participating child to the school in which 
     such child will enroll;
       ``(2) establishing channels of communication between Head 
     Start staff and their counterparts in the schools (including 
     teachers, social workers, and health staff) to facilitate 
     coordination of programs;
       ``(3) conducting meetings involving parents, kindergarten 
     or elementary school teachers, and Head Start program 
     teachers to discuss the developmental and other needs of 
     individual children;
       ``(4) organizing and participating in joint transition-
     related training of school staff and Head Start staff;
       ``(5) developing and implementing a family outreach and 
     support program in cooperation with entities carrying out 
     parental involvement efforts under title I of the Elementary 
     and Secondary Education Act of 1965 (20 U.S.C. 6301 et seq.); 
     and
       ``(6) assisting families, administrators, and teachers in 
     enhancing continuity in child development between Head Start 
     services and elementary school classes.''.

     SEC. 112. SUBMISSION OF PLANS TO GOVERNORS.

       The first sentence of section 643 (42 U.S.C. 9838) is 
     amended--
       (1) by striking ``within 30 days'' and inserting ``within 
     45 days''; and
       (2) by striking ``so disapproved'' and inserting 
     ``disapproved (for reasons other than failure of the program 
     to comply with State health, safety, and child care laws, 
     including regulations, applicable to comparable child care 
     programs within the State)''.

     SEC. 113. PARTICIPATION IN HEAD START PROGRAMS.

       (a) Regulations.--Section 645(a)(1) (42 U.S.C. 9840(a)(1)) 
     is amended--
       (1) in subparagraph (B), by striking ``that programs'' and 
     inserting ``that (i) programs''; and
       (2) by striking the period at the end of subparagraph (B) 
     and inserting the following: ``, and (ii) a child who has 
     been determined to meet the low-income criteria and who is 
     participating in a Head Start program in a program year shall 
     be considered to continue to meet the low-income criteria 
     through the end of the succeeding program year. In 
     determining, for purposes of this paragraph, whether a child 
     who has applied for enrollment in a Head Start program meets 
     the low-income criteria, an entity may consider evidence of 
     family income during the 12 months preceding the month in 
     which the application is submitted, or during the calendar 
     year preceding the calendar year in which the application is 
     submitted, whichever more accurately reflects the needs of 
     the family at the time of application.''.
       (b) Sliding Fee Scale.--Section 645(b) (42 U.S.C. 9840(b)) 
     is amended by adding at the end the following: ``A Head Start 
     agency that provides a Head Start program with full-working-
     day services in collaboration with other agencies or entities 
     may collect a family copayment to support extended day 
     services if a copayment is required in conjunction with the 
     collaborative. The copayment charged to families receiving 
     services through the Head Start program shall not exceed the 
     copayment charged to families with similar incomes and 
     circumstances who are receiving the services through 
     participation in a program carried out by another agency or 
     entity.''.
       (c) Continuous Recruitment and Acceptance of 
     Applications.--Section 645(c) (42 U.S.C. 9840(c)) is amended 
     by adding at the end the following: ``Each Head Start program 
     operated in a community shall be permitted to recruit and 
     accept applications for enrollment of children throughout the 
     year.''.

     SEC. 114. EARLY HEAD START PROGRAMS FOR FAMILIES WITH INFANTS 
                   AND TODDLERS.

       Section 645A (42 U.S.C. 9840a) is amended--
       (1) in the section heading, by inserting ``early head 
     start'' before ``programs for'';
       (2) in subsection (a)--
       (A) by striking ``for--'' and all that follows through 
     ``programs providing'' and inserting ``for programs 
     providing'';
       (B) by striking ``; and'' and inserting a period; and

[[Page S9071]]

       (C) by striking paragraph (2);
       (3) in subsection (b)(5), by inserting ``(including 
     programs for infants and toddlers with disabilities)'' after 
     ``community'';
       (4) in subsection (c)--
       (A) in the matter preceding paragraph (1), by striking 
     ``subsection (a)(1)'' and inserting ``subsection (a)''; and
       (B) in paragraph (2), by striking ``3 (or under'' and all 
     that follows and inserting ``3;'';
       (5) in subsection (d)--
       (A) by striking paragraph (2); and
       (B) by redesignating paragraph (3) as paragraph (2);
       (6) by striking subsection (e);
       (7) by redesignating subsections (f) and (g) as subsections 
     (e) and (f), respectively;
       (8) in subsection (e) (as redesignated in paragraph (7))--
       (A) in the subsection heading, by striking ``Other''; and
       (B) by striking ``From the balance remaining of the portion 
     specified in section 640(a)(6), after making grants to the 
     eligible entities specified in subsection (e),'' and 
     inserting ``From the portion specified in section 
     640(a)(6),''; and
       (9) by striking subsection (h) and inserting the following:
       ``(g) Monitoring, Training, Technical Assistance, and 
     Evaluation.--In order to ensure the successful operation of 
     programs assisted under this section, the Secretary shall use 
     funds from the portion specified in section 640(a)(6) to 
     monitor the operation of such programs, evaluate their 
     effectiveness, and provide training and technical assistance 
     tailored to the particular needs of such programs.
       ``(h) Training and Technical Assistance Account.--
       ``(1) In general.--Of the amount made available to carry 
     out this section for any fiscal year, not less than 5 percent 
     and not more than 10 percent shall be reserved to fund a 
     training and technical assistance account.
       ``(2) Activities.--Funds in the account may be used by the 
     Secretary for purposes including--
       ``(A) making grants to, and entering into contracts with, 
     organizations with specialized expertise relating to infants, 
     toddlers, and families and the capacity needed to provide 
     direction and support to a national training and technical 
     assistance system, in order to provide such direction and 
     support;
       ``(B) providing ongoing training and technical assistance 
     for regional and program staff charged with monitoring and 
     overseeing the administration of the program carried out 
     under this section;
       ``(C) providing ongoing training and technical assistance 
     for recipients of grants under subsection (a) and support and 
     program planning and implementation assistance for new 
     recipients of such grants; and
       ``(D) providing professional development and personnel 
     enhancement activities, including the provision of funds to 
     recipients of grants under subsection (a) for the recruitment 
     and retention of qualified staff with an appropriate level of 
     education and experience.''.

     SEC. 115. TECHNICAL ASSISTANCE AND TRAINING.

       (a) Full-Working-Day, Full Calendar Year Services.--Section 
     648(b) (42 U.S.C. 9843(b)) is amended--
       (1) in paragraph (1), by striking ``; and'' and inserting a 
     semicolon;
       (2) in paragraph (2), by striking the period and inserting 
     ``; and''; and
       (3) by adding at the end the following:
       ``(3) ensure the provision of technical assistance to 
     assist Head Start agencies, entities carrying out other child 
     care and early childhood programs, communities, and States in 
     collaborative efforts to provide quality full-working-day, 
     full calendar year services, including technical assistance 
     related to identifying and assisting in resolving barriers to 
     collaboration.''.
       (b) Allocating Resources.--Section 648(c) (42 U.S.C. 
     9843(c)) is amended--
       (1) in paragraph (4)--
       (A) by striking ``developing'' and inserting ``developing 
     and implementing''; and
       (B) by striking ``a longer day;'' and inserting the 
     following: ``the day, and assist the agencies and programs in 
     expediting the sharing of information about innovative models 
     for providing full-working-day, full calendar year services 
     for children;'';
       (2) in paragraph (7), by striking ``; and'' and inserting a 
     semicolon;
       (3) in paragraph (8), by striking the period and inserting 
     ``; and''; and
       (4) by adding at the end the following:
       ``(9) assist Head Start agencies in--
       ``(A) ensuring the school readiness of children; and
       ``(B) meeting the education performance standards described 
     in this subchapter.''.
       (c) Services.--Section 648(e) (42 U.S.C. 9843(e)) is 
     amended by inserting ``(including services to promote the 
     acquisition of the English language)'' after ``non-English 
     language background children''.

     SEC. 116. STAFF QUALIFICATIONS AND DEVELOPMENT.

       Section 648A(a) (42 U.S.C. 9843a(a)) is amended--
       (1) in paragraph (1)--
       (A) by redesignating subparagraphs (B) through (D) as 
     clauses (ii) through (iv), respectively;
       (B) by striking ``(A)'' and inserting ``(B)(i)''; and
       (C) by inserting before subparagraph (B) (as redesignated 
     in subparagraph (B) of this paragraph) the following:
       ``(A) demonstrated competency to perform functions that 
     include--
       ``(i) planning and implementing learning experiences that 
     advance the intellectual and physical development of 
     children, including improving the readiness of children for 
     school by developing their literacy and phonemic, print, and 
     numeracy awareness, their understanding and use of oral 
     language, their understanding and use of increasingly complex 
     and varied vocabulary, their appreciation of books, and their 
     problem solving abilities;
       ``(ii) establishing and maintaining a safe, healthy 
     learning environment;
       ``(iii) supporting the social and emotional development of 
     children; and
       ``(iv) encouraging the involvement of the families of the 
     children in a Head Start program and supporting the 
     development of relationships between children and their 
     families; and''; and
       (2) by striking paragraph (2) and inserting the following:
       ``(2) Waiver.--On request, the Secretary shall grant a 180-
     day waiver of the requirements of paragraph (1)(B), for a 
     Head Start agency that can demonstrate that the agency has 
     unsuccessfully attempted to recruit an individual who has a 
     credential, certificate, or degree described in paragraph 
     (1)(B), with respect to an individual who--
       ``(A) is enrolled in a program that grants any such 
     credential, certificate, or degree; and
       ``(B) will receive such credential, certificate, or degree 
     under the terms of such program not later than 180 days after 
     beginning employment as a teacher with such agency.''.

     SEC. 117. RESEARCH, DEMONSTRATION, AND EVALUATION.

       (a) Comparative Studies.--Section 649(d) (42 U.S.C. 
     9844(d)) is amended--
       (1) in paragraph (6), by striking ``; and'' and inserting a 
     semicolon;
       (2) in paragraph (7), by striking the period and inserting 
     ``; and''; and
       (3) by adding at the end the following:
       ``(8) study the experiences of small, medium, and large 
     States with Head Start programs in order to permit 
     comparisons of children participating in the programs with 
     eligible children who did not participate in the programs, 
     which study--
       ``(A) may include the use of a data set that existed prior 
     to the initiation of the study; and
       ``(B) shall compare the educational achievement, social 
     adaptation, and health status of the participating children 
     and the eligible nonparticipating children.

     The Secretary shall ensure that an appropriate entity carries 
     out a study described in paragraph (8), and prepares and 
     submits to the appropriate committees of Congress a report 
     containing the results of the study, not later than September 
     30, 2002.''.
       (b) National Research.--Section 649 (42 U.S.C. 9844) is 
     amended by adding at the end the following:
       ``(g) National Head Start Impact Research.--
       ``(1) Expert panel.--
       ``(A) In general.--The Secretary shall appoint an 
     independent panel consisting of experts in program evaluation 
     and research, education, and early childhood programs--
       ``(i) to review, and make recommendations on, the design 
     and plan for the research (whether conducted as a single 
     assessment or as a series of assessments), described in 
     paragraph (2), within 1 year after the date of enactment of 
     the Coats Human Services Reauthorization Act of 1998;
       ``(ii) to maintain and advise the Secretary regarding the 
     progress of the research; and
       ``(iii) to comment, if the panel so desires, on the interim 
     and final research reports submitted under paragraph (7).
       ``(B) Travel expenses.--The members of the panel shall not 
     receive compensation for the performance of services for the 
     panel, but shall be allowed travel expenses, including per 
     diem in lieu of subsistence, at rates authorized for 
     employees of agencies under subchapter I of chapter 57 of 
     title 5, United States Code, while away from their homes or 
     regular places of business in the performance of services for 
     the panel. Notwithstanding section 1342 of title 31, United 
     States Code, the Secretary may accept the voluntary and 
     uncompensated services of members of the panel.
       ``(2) General authority.--After reviewing the 
     recommendations of the expert panel, the Secretary shall 
     enter into a grant, contract, or cooperative agreement with 
     an organization to conduct independent research that provides 
     a national analysis of the impact of Head Start programs. The 
     Secretary shall ensure that the organization shall have 
     expertise in program evaluation, and research, education, and 
     early childhood programs.
       ``(3) Designs and techniques.--The Secretary shall ensure 
     that the research uses rigorous methodological designs and 
     techniques (based on the recommendations of the expert 
     panel), including longitudinal designs, control groups, 
     nationally recognized standardized measures, and random 
     selection and assignment, as appropriate. The Secretary may 
     provide that the research shall be conducted as a single 
     comprehensive assessment or as a group of coordinated 
     assessments designed to provide, when taken together, a 
     national analysis of the impact of Head Start programs.
       ``(4) Programs.--The Secretary shall ensure that the 
     research focuses primarily on Head Start programs that 
     operate in the 50 States, the Commonwealth of Puerto Rico, or 
     the District of Columbia and that do not specifically target 
     special populations.
       ``(5) Analysis.--The Secretary shall ensure that the 
     organization conducting the research--
       ``(A)(i) determines if, overall, the Head Start programs 
     have impacts consistent with their primary goal of increasing 
     the social competence of children, by increasing the everyday 
     effectiveness of the children in dealing with their present 
     environments and future responsibilities, and increasing 
     their school readiness;

[[Page S9072]]

       ``(ii) considers whether the Head Start programs--
       ``(I) enhance the growth and development of children in 
     cognitive, emotional, and physical health areas;
       ``(II) strengthen families as the primary nurturers of 
     their children; and
       ``(III) ensure that children attain school readiness; and
       ``(iii) examines--
       ``(I) the impact of the Head Start programs on increasing 
     access of children to such services as educational, health, 
     and nutritional services, and linking children and families 
     to needed community services; and
       ``(II) how receipt of services described in subclause (I) 
     enriches the lives of children and families participating in 
     Head Start programs;
       ``(B) examines the impact of Head Start programs on 
     participants on the date the participants leave Head Start 
     programs, at the end of kindergarten (in public or private 
     school), and at the end of first grade (in public or private 
     school), by examining a variety of factors, including 
     educational achievement, referrals for special education or 
     remedial course work, and absenteeism;
       ``(C) makes use of random selection from the population of 
     all Head Start programs described in paragraph (4) in 
     selecting programs for inclusion in the research; and
       ``(D) includes comparisons of individuals who participate 
     in Head Start programs with control groups (including 
     comparison groups) composed of--
       ``(i) individuals who participate in other public or 
     private early childhood programs (such as public or private 
     preschool programs and day care); and
       ``(ii) individuals who do not participate in any other 
     early childhood program.
       ``(6) Consideration of sources of variation.--In designing 
     the research, the Secretary shall, to the extent practicable, 
     consider addressing possible sources of variation in impact 
     of Head Start programs, including variations in impact 
     related to such factors as--
       ``(A) Head Start program operations;
       ``(B) Head Start program quality;
       ``(C) the length of time a child attends a Head Start 
     program;
       ``(D) the age of the child on entering the Head Start 
     program;
       ``(E) the type of organization (such as a local educational 
     agency or a community action agency) providing services for 
     the Head Start program;
       ``(F) the number of hours and days of program operation of 
     the Head Start program (such as whether the program is a 
     full-working-day, full calendar year program, a part-day 
     program, or a part-year program); and
       ``(G) other characteristics and features of the Head Start 
     program (such as geographic location, location in an urban or 
     a rural service area, or participant characteristics), as 
     appropriate.
       ``(7) Reports.--
       ``(A) Submission of interim reports.--The organization 
     shall prepare and submit to the Secretary two interim reports 
     on the research. The first interim report shall describe the 
     design of the research, and the rationale for the design, 
     including a description of how potential sources of variation 
     in impact of Head Start programs have been considered in 
     designing the research. The second interim report shall 
     describe the status of the research and preliminary findings 
     of the research, as appropriate.
       ``(B) Submission of final report.--The organization shall 
     prepare and submit to the Secretary a final report containing 
     the findings of the research.
       ``(C) Transmittal of reports to congress.--
       ``(i) In general.--The Secretary shall transmit, to the 
     committees described in clause (ii), the first interim report 
     by September 30, 1999, the second interim report by September 
     30, 2001, and the final report by September 30, 2003.
       ``(ii) Committees.--The committees referred to in clause 
     (i) are the Committee on Education and the Workforce of the 
     House of Representatives and the Committee on Labor and Human 
     Resources of the Senate.
       ``(8) Definition.--In this subsection, the term `impact', 
     used with respect to a Head Start program, means a difference 
     in an outcome for a participant in the program that would not 
     have occurred without the participation in the program.
       ``(h) Quality Improvement Study.--
       ``(1) Study.--The Secretary shall conduct a study regarding 
     the use and effects of use of the quality improvement funds 
     made available under section 640(a)(3) of the Head Start Act 
     (42 U.S.C. 9835(a)(3)) since fiscal year 1991.
       ``(2) Report.--The Secretary shall prepare and submit to 
     Congress not later than September 2000 a report containing 
     the results of the study, including--
       ``(A) the types of activities funded with the quality 
     improvement funds;
       ``(B) the extent to which the use of the quality 
     improvement funds has accomplished the goals of section 
     640(a)(3)(B);
       ``(C) the effect of use of the quality improvement funds on 
     teacher training, salaries, benefits, recruitment, and 
     retention; and
       ``(D) the effect of use of the quality improvement funds on 
     the cognitive and social development of children receiving 
     services under this subchapter.''.

     SEC. 118. REPEAL.

       The Head Start Transition Project Act (42 U.S.C. 9855 et 
     seq.) is repealed.

            TITLE II--COMMUNITY SERVICES BLOCK GRANT PROGRAM

     SEC. 201. REAUTHORIZATION.

       The Community Services Block Grant Act (42 U.S.C. 9901 et 
     seq.) is amended to read as follows:

          ``Subtitle B--Community Services Block Grant Program

     ``SEC. 671. SHORT TITLE.

       ``This subtitle may be cited as the `Community Services 
     Block Grant Act'.

     ``SEC. 672. PURPOSES AND GOALS.

       ``The purposes of this subtitle are--
       ``(1) to provide financial assistance to States and local 
     communities, working through a network of community action 
     agencies and other neighborhood-based organizations, for the 
     reduction of poverty, the revitalization of low-income 
     communities, and the empowerment of low-income families and 
     individuals in rural and urban areas to become fully self-
     sufficient (particularly families who are attempting to 
     transition off a State program carried out under part A of 
     title IV of the Social Security Act (42 U.S.C. 601 et seq.)); 
     and
       ``(2) to accomplish the goals described in paragraph (1) 
     through--
       ``(A) the strengthening of community capabilities for 
     planning and coordinating the use of a broad range of 
     Federal, State, and other assistance related to the 
     elimination of poverty, so that this assistance can be used 
     in a manner responsive to local needs and conditions;
       ``(B) the organization of a range of services related to 
     the needs of low-income families and individuals, so that 
     these services may have a measurable and potentially major 
     impact on the causes of poverty in the community and may help 
     the families and individuals to achieve self-sufficiency;
       ``(C) the use of innovative and effective community-based 
     approaches to attacking the causes and effects of poverty and 
     of community breakdown;
       ``(D) the development and implementation of all programs 
     designated to serve low-income communities and groups with 
     the maximum feasible participation of residents of the 
     communities and members of the groups served, so as to best 
     stimulate and take full advantage of capabilities for self-
     advancement and assure that the programs are otherwise 
     meaningful to the intended beneficiaries of the programs; and
       ``(E) the broadening of the resource base of programs 
     directed to the elimination of poverty.

     ``SEC. 673. DEFINITIONS.

       ``In this subtitle:
       ``(1) Eligible entity.--The term `eligible entity' means an 
     entity--
       ``(A) that is an eligible entity described in section 
     673(1) (as in effect on the day before the date of enactment 
     of the Coats Human Services Reauthorization Act of 1998) as 
     of the day before such date of enactment or is designated by 
     the process described in section 676A (including an 
     organization serving migrant or seasonal farmworkers that is 
     so described or designated); and
       ``(B) that has a tripartite board or other mechanism 
     described in subsection (a) or (b), as appropriate, of 
     section 676B.
       ``(2) Poverty line.--The term `poverty line' means the 
     official poverty line defined by the Office of Management and 
     Budget based on Bureau of the Census data. The Secretary 
     shall revise annually (or at any shorter interval the 
     Secretary determines to be feasible and desirable) the 
     poverty line, which shall be used as a criterion of 
     eligibility in the community services block grant program 
     established under this subtitle. The required revision shall 
     be accomplished by multiplying the official poverty line by 
     the percentage change in the Consumer Price Index for All 
     Urban Consumers during the annual or other interval 
     immediately preceding the time at which the revision is made. 
     Whenever a State determines that it serves the objectives of 
     the block grant program established under this subtitle, the 
     State may revise the poverty line to not to exceed 125 
     percent of the official poverty line otherwise applicable 
     under this paragraph.
       ``(3) Private, nonprofit organization.--The term `private, 
     nonprofit organization' includes a faith-based organization, 
     to which the provisions of section 679 shall apply.
       ``(4) Secretary.--The term `Secretary' means the Secretary 
     of Health and Human Services.
       ``(5) State.--The term `State' means each of the several 
     States, the District of Columbia, the Commonwealth of Puerto 
     Rico, Guam, the United States Virgin Islands, American Samoa, 
     the Commonwealth of the Northern Mariana Islands, and the 
     combined Freely Associated States.

     ``SEC. 674. AUTHORIZATION OF APPROPRIATIONS.

       ``(a) In General.--There are authorized to be appropriated 
     $625,000,000 for fiscal year 1999 and such sums as may be 
     necessary for each of fiscal years 2000 through 2003 to carry 
     out the provisions of this subtitle (other than sections 681 
     and 682).
       ``(b) Reservations.--Of the amounts appropriated under 
     subsection (a) for each fiscal year, the Secretary shall 
     reserve--
       ``(1) \1/2\ of 1 percent for carrying out section 675A 
     (relating to payments for territories);
       ``(2) not less than \1/2\ of 1 percent and not more than 1 
     percent for activities authorized in section 678A (relating 
     to training and technical assistance); and
       ``(3) 9 percent for carrying out section 680 (relating to 
     discretionary activities).

     ``SEC. 675. ESTABLISHMENT OF BLOCK GRANT PROGRAM.

       ``The Secretary is authorized to establish a community 
     services block grant program and make grants through the 
     program to States to ameliorate the causes of poverty in 
     communities within the States.

     ``SEC. 675A. DISTRIBUTION TO TERRITORIES.

       ``(a) Apportionment.--The Secretary shall apportion the 
     amount reserved under section 674(b)(1) for each fiscal year 
     on the basis of need among Guam, American Samoa, the United 
     States Virgin Islands, the Commonwealth of the

[[Page S9073]]

     Northern Mariana Islands, and the combined Freely Associated 
     States.
       ``(b) Application.--Each jurisdiction to which subsection 
     (a) applies may receive a grant under this subtitle for the 
     amount apportioned under subsection (a) on submitting to the 
     Secretary, and obtaining approval of, an application, 
     containing provisions that describe the programs for which 
     assistance is sought under this subtitle, that is prepared in 
     accordance with, and contains the information described in, 
     section 676.

     ``SEC. 675B. ALLOTMENTS AND PAYMENTS TO STATES.

       ``(a) Allotments in General.--The Secretary shall, from the 
     amount appropriated under section 674(a) for each fiscal year 
     that remains after the Secretary makes the reservations 
     required in section 674(b), allot to each State (subject to 
     section 677) an amount that bears the same ratio to such 
     remaining amount as the amount received by the State for 
     fiscal year 1981 under section 221 of the Economic 
     Opportunity Act of 1964 bore to the total amount received by 
     all States for fiscal year 1981 under such section, except 
     that no State shall receive less than \1/4\ of 1 percent of 
     the amount appropriated under section 674(a) for such fiscal 
     year.
       ``(b) Allotments in Years With Greater Available Funds.--
       ``(1) Minimum allotments.--Subject to paragraphs (2) and 
     (3), if the amount appropriated under section 674(a) for a 
     fiscal year that remains after the Secretary makes the 
     reservations required in section 674(b) exceeds $345,000,000, 
     the Secretary shall allot to each State not less than \1/2\ 
     of 1 percent of the amount appropriated under section 674(a) 
     for such fiscal year.
       ``(2) Maintenance of fiscal year 1990 levels.--Paragraph 
     (1) shall not apply with respect to a fiscal year if the 
     amount allotted under subsection (a) to any State for that 
     year is less than the amount allotted under section 674(a)(1) 
     (as in effect on September 30, 1989) to such State for fiscal 
     year 1990.
       ``(3) Maximum allotments.--The amount allotted under 
     paragraph (1) to a State for a fiscal year shall be reduced, 
     if necessary, so that the aggregate amount allotted to such 
     State under such paragraph and subsection (a) does not exceed 
     140 percent of the aggregate amount allotted to such State 
     under the corresponding provisions of this subtitle for the 
     preceding fiscal year.
       ``(c) Payments.--The Secretary shall make grants to 
     eligible States for the allotments described in subsections 
     (a) and (b). The Secretary shall make payments for the grants 
     in accordance with section 6503(a) of title 31, United States 
     Code.
       ``(d) Definition.--For purposes of this section, the term 
     `State' does not include Guam, American Samoa, the United 
     States Virgin Islands, the Commonwealth of the Northern 
     Mariana Islands, and the Freely Associated States.

     ``SEC. 675C. USES OF FUNDS.

       ``(a) Grants to Eligible Entities and Other 
     Organizations.--
       ``(1) In general.--Not less than 90 percent of the funds 
     made available to a State under section 675A or 675B shall be 
     used by the State to make grants for the purposes described 
     in section 672 to eligible entities.
       ``(2) Obligational authority.--Funds distributed to 
     eligible entities through grants made in accordance with 
     paragraph (1) for a fiscal year shall be available for 
     obligation during that fiscal year and the succeeding fiscal 
     year, in accordance with paragraph (3).
       ``(3) Recapture and redistribution of unobligated funds.--
       ``(A) Amount.--Beginning on October 1, 2000, a State may 
     recapture and redistribute funds distributed to an eligible 
     entity through a grant made under paragraph (1) that are 
     unobligated at the end of a fiscal year if such unobligated 
     funds exceed 20 percent of the amount so distributed to such 
     eligible entity for such fiscal year.
       ``(B) Redistribution.--In redistributing funds recaptured 
     in accordance with this paragraph, States shall redistribute 
     such funds to an eligible entity, or require the original 
     recipient of the funds to redistribute the funds to a 
     private, nonprofit organization, located within the community 
     served by the original recipient of the funds, for activities 
     consistent with the purposes of this subtitle.
       ``(b) Other Activities.--
       ``(1) Use of remainder.--If a State uses less than 100 
     percent of payments from a grant under section 675A, or the 
     State allotment under section 675B, to make grants under 
     subsection (a), the State shall use the remainder of such 
     payments (subject to paragraph (2)) for--
       ``(A) providing training and technical assistance to those 
     entities in need of such training and assistance;
       ``(B) coordinating State-operated programs and services 
     targeted to low-income children and families with services 
     provided by eligible entities and other organizations funded 
     under this subtitle, including detailing appropriate 
     employees of State or local agencies to entities funded under 
     this subtitle, to ensure increased access to services 
     provided by such State or local agencies;
       ``(C) supporting statewide coordination and communication 
     among eligible entities;
       ``(D) analyzing the distribution of funds made available 
     under this subtitle within the State to determine if such 
     funds have been targeted to the areas of greatest need;
       ``(E) supporting asset-building programs for low-income 
     individuals, such as programs supporting individual 
     development accounts;
       ``(F) supporting innovative programs and activities 
     conducted by community action agencies or other neighborhood-
     based organizations to eliminate poverty, promote self-
     sufficiency, and promote community revitalization; and
       ``(G) supporting other activities, consistent with the 
     purposes of this subtitle.
       ``(2) Administrative cap.--No State may spend more than the 
     greater of $55,000, or 5 percent, of the State allotment for 
     administrative expenses, including monitoring activities. The 
     cost of activities conducted under paragraph (1)(A) shall not 
     be considered to be administrative expenses.

     ``SEC. 676. APPLICATION AND PLAN.

       ``(a) Designation of Lead Agency.--
       ``(1) Designation.--The chief executive officer of a State 
     desiring to receive an allotment under this subtitle shall 
     designate, in an application submitted to the Secretary under 
     subsection (b), an appropriate State agency that complies 
     with the requirements of paragraph (2) to act as a lead 
     agency for purposes of carrying out State activities under 
     this subtitle.
       ``(2) Duties.--The lead agency designated in accordance 
     with paragraph (1) shall--
       ``(A) develop the State plan to be submitted to the 
     Secretary under subsection (b);
       ``(B) in conjunction with the development of the State plan 
     as required under subsection (b), hold at least one hearing 
     in the State with sufficient time, and statewide distribution 
     of notice of such hearing, to provide to the public an 
     opportunity to comment on the proposed use and distribution 
     of funds to be provided through the allotment for the period 
     covered by the State plan; and
       ``(C) conduct reviews of eligible entities under section 
     678B.
       ``(3) Legislative hearing.--In order to be eligible to 
     receive an allotment under this subtitle, the State shall 
     hold at least one legislative hearing every 3 years in 
     conjunction with the development of the State plan.
       ``(b) State Application and Plan.--Beginning with fiscal 
     year 2000, to be eligible to receive an allotment under this 
     subtitle, a State shall prepare and submit to the Secretary 
     an application and State plan covering a period of not less 
     than 1 fiscal year and not more than 2 fiscal years. The plan 
     shall be submitted not later than 30 days prior to the 
     beginning of the first fiscal year covered by the plan, and 
     shall contain such information as the Secretary shall 
     require, including--
       ``(1) an assurance that funds made available through the 
     allotment will be used to support activities that are 
     designed to assist low-income families and individuals, 
     including homeless families and individuals, migrant or 
     seasonal farmworkers, and elderly low-income individuals and 
     families, and a description of how such activities will 
     enable the families and individuals--
       ``(A) to remove obstacles and solve problems that block the 
     achievement of self-sufficiency;
       ``(B) to secure and retain meaningful employment;
       ``(C) to attain an adequate education;
       ``(D) to make better use of available income;
       ``(E) to obtain and maintain adequate housing and a 
     suitable living environment;
       ``(F) to obtain emergency assistance through loans, grants, 
     or other means to meet immediate and urgent individual and 
     family needs;
       ``(G) to achieve greater participation in the affairs of 
     the community involved; and
       ``(H) to make more effective use of other programs related 
     to the purposes of this subtitle (including State welfare 
     reform efforts);
       ``(2) a description of how the State intends to use 
     discretionary funds made available from the remainder of the 
     allotment described in section 675C(b) in accordance with 
     this subtitle, including a description of how the State will 
     support innovative community and neighborhood-based 
     initiatives related to the purposes of this subtitle;
       ``(3) based on information provided by eligible entities in 
     the State, a description of--
       ``(A) the service delivery system, for services provided or 
     coordinated with funds made available through the allotment, 
     targeted to low-income individuals and families in 
     communities within the State;
       ``(B) how linkages will be developed to fill identified 
     gaps in the services, through the provision of information, 
     referrals, case management, and followup consultations;
       ``(C) how funds made available through the allotment will 
     be coordinated with other public and private resources; and
       ``(D) how the funds will be used to support innovative 
     community and neighborhood-based initiatives related to the 
     purposes of this subtitle;
       ``(4) an assurance that the State will provide, on an 
     emergency basis, for the provision of such supplies and 
     services, nutritious foods, and related services, as may be 
     necessary to counteract conditions of starvation and 
     malnutrition among low-income individuals;
       ``(5) an assurance that the State will coordinate, and 
     establish linkages between, governmental and other social 
     services programs to assure the effective delivery of such 
     services to low-income individuals;
       ``(6) an assurance that the State will ensure coordination 
     between antipoverty programs in each community, and ensure, 
     where appropriate, that emergency energy crisis intervention 
     programs under title XXVI (relating to low-income home energy 
     assistance) are conducted in such community;
       ``(7) an assurance that the State will permit and cooperate 
     with Federal investigations undertaken in accordance with 
     section 678D;
       ``(8) an assurance that any eligible entity that received 
     funding in the previous fiscal year under this subtitle will 
     not have its funding terminated under this subtitle, or 
     reduced below the proportional share of funding the entity 
     received in the previous fiscal year unless, after providing 
     notice and an opportunity for a hearing on the record, the 
     State determines that cause exists for such termination or 
     such reduction, subject to review by the Secretary as 
     provided in section 678C(b);

[[Page S9074]]

       ``(9) an assurance that the State will, to the maximum 
     extent possible, coordinate programs with and form 
     partnerships with other organizations serving low-income 
     residents of the communities and members of the groups served 
     by the State, including faith-based organizations, charitable 
     groups, and community organizations;
       ``(10) an assurance that the State will require each 
     eligible entity to establish procedures under which a low-
     income individual, community organization, or faith-based 
     organization, or representative of low-income individuals 
     that considers its organization, or low-income individuals, 
     to be inadequately represented on the board (or other 
     mechanism) of the eligible entity to petition for adequate 
     representation;
       ``(11) an assurance that the State will secure from each 
     eligible entity, as a condition to receipt of funding by the 
     entity under this subtitle for a program, a community action 
     plan (which shall be submitted to the Secretary, at the 
     request of the Secretary, with the State plan) that includes 
     a community-needs assessment for the community served, which 
     may be coordinated with community-needs assessments conducted 
     for other programs;
       ``(12) an assurance that the State and all eligible 
     entities in the State will, not later than fiscal year 2002, 
     participate in the Results Oriented Management and 
     Accountability System, any other performance measure system 
     established by the Secretary under section 678E(b), or an 
     alternative system for measuring performance and results that 
     meets the requirements of that section, and a description of 
     outcome measures to be used to measure eligible entity 
     performance in promoting self-sufficiency, family stability, 
     and community revitalization; and
       ``(13) information describing how the State will carry out 
     the assurances described in this subsection.
       ``(c) Determinations.--For purposes of making a 
     determination in accordance with subsection (b)(8) with 
     respect to--
       ``(1) a funding reduction, the term `cause' includes--
       ``(A) a statewide redistribution of funds provided under 
     this subtitle to respond to--
       ``(i) the results of the most recently available census or 
     other appropriate data;
       ``(ii) the designation of a new eligible entity; or
       ``(iii) severe economic dislocation; or
       ``(B) the failure of an eligible entity to comply with the 
     terms of an agreement to provide services under this 
     subtitle; and
       ``(2) a termination, the term `cause' includes the material 
     failure of an eligible entity to comply with the terms of 
     such an agreement and the State plan to provide services 
     under this subtitle or the consistent failure of the entity 
     to achieve performance measures as determined by the State.
       ``(d) Procedures.--The Secretary may prescribe procedures 
     relating to the implementation of this section only for the 
     purpose of assessing the effectiveness of eligible entities 
     in carrying out the purposes of this subtitle.
       ``(e) Revisions and Inspection.--
       ``(1) Revisions.--The chief executive officer of each State 
     may revise any plan prepared under this section and shall 
     submit the revised plan to the Secretary.
       ``(2) Public inspection.--Each plan or revised plan 
     prepared under this section shall be made available for 
     public inspection within the State in such a manner as will 
     facilitate review of, and comment on, the plan.
       ``(f) Fiscal Year 1999.--For fiscal year 2000, to be 
     eligible to receive an allotment under this subtitle, a State 
     shall prepare and submit to the Secretary an application and 
     State plan in accordance with the provisions of this subtitle 
     (as in effect on the day before the date of enactment of the 
     Coats Human Services Reauthorization Act of 1998), rather 
     than the provisions of subsections (a) through (c) relating 
     to applications and plans.

     ``SEC. 676A. DESIGNATION AND REDESIGNATION OF ELIGIBLE 
                   ENTITIES IN UNSERVED AREAS.

       ``(a) Qualified Organization in or Near Area.--
       ``(1) In general.--If any geographic area of a State is 
     not, or ceases to be, served by an eligible entity under this 
     subtitle, and if the chief executive officer of the State 
     decides to serve such area, the chief executive officer may 
     solicit applications from, and designate as an eligible 
     entity, one or more--
       ``(A) private nonprofit organizations geographically 
     located in the unserved area that meet the requirements of 
     this subtitle; or
       ``(B) private nonprofit organizations (which may include 
     eligible entities) located in an area contiguous to or within 
     reasonable proximity of the unserved area that are already 
     providing related services in the unserved area.
       ``(2) Requirement.--In order to serve as the eligible 
     entity for the area, an entity described in paragraph (1)(B) 
     shall agree to add additional members to the board of the 
     entity to ensure adequate representation--
       ``(A) in each of the three required categories described in 
     subparagraphs (A), (B), and (C) of section 676B(a)(2), by 
     members that reside in the community comprised by the 
     unserved area; and
       ``(B) in the category described in section 676B(a)(2)(B), 
     by members that reside in the neighborhood served.
       ``(b) Special Consideration.--In designating an eligible 
     entity under subsection (a), the chief executive officer 
     shall grant the designation to an organization of 
     demonstrated effectiveness in meeting the goals and purposes 
     of this subtitle and may give priority, in granting the 
     designation, to local entities that are providing services in 
     the unserved area, consistent with the needs identified by a 
     community-needs assessment.
       ``(c) No Qualified Organization in or Near Area.--If no 
     private, nonprofit organization is identified or determined 
     to be qualified under subsection (a) to serve the unserved 
     area as an eligible entity the chief executive officer may 
     designate an appropriate political subdivision of the State 
     to serve as an eligible entity for the area. In order to 
     serve as the eligible entity for that area, the political 
     subdivision shall have a board or other mechanism as required 
     in section 676B(b).

     ``SEC. 676B. TRIPARTITE BOARDS.

       ``(a) Private Nonprofit Entities.--
       ``(1) Board.--In order for a private, nonprofit entity to 
     be considered to be an eligible entity for purposes of 
     section 673(1), the entity shall administer the community 
     services block grant program through a tripartite board 
     described in paragraph (2) that fully participates in the 
     development, planning, and implementation of the program to 
     serve low-income communities.
       ``(2) Selection and composition of board.--The members of 
     the board referred to in paragraph (1) shall be selected by 
     the entity and the board shall be composed so as to assure 
     that--
       ``(A) \1/3\ of the members of the board are elected public 
     officials, holding office on the date of selection, or their 
     representatives, except that if the number of elected 
     officials reasonably available and willing to serve on the 
     board is less than \1/3\ of the membership of the board, 
     membership on the board of appointive public officials or 
     their representatives may be counted in meeting such \1/3\ 
     requirement;
       ``(B) not fewer than \1/3\ of the members are persons 
     chosen in accordance with democratic selection procedures 
     adequate to assure that these members are representative of 
     low-income individuals and families in the neighborhood 
     served;
       ``(C) the remainder of the members are officials or members 
     of business, industry, labor, religious, law enforcement, 
     education, or other major groups and interests in the 
     community served; and
       ``(D)(i) each member resides in the community; and
       ``(ii) each representative of low-income individuals and 
     families selected to represent a specific neighborhood within 
     a community under this paragraph resides in the neighborhood 
     represented by the member.
       ``(b) Public Organizations.--In order for a public 
     organization to be considered to be an eligible entity for 
     purposes of section 673(1), the entity shall administer the 
     community services block grant program through--
       ``(1) a tripartite board, which shall have members selected 
     by the organization and shall be composed so as to assure 
     that not fewer than \1/3\ of the members are persons chosen 
     in accordance with democratic selection procedures adequate 
     to assure that these members--
       ``(A) are representative of low-income individuals and 
     families in the neighborhood served;
       ``(B) reside in the neighborhood served; and
       ``(C) are able to participate actively in the development, 
     planning, and implementation of programs funded under this 
     subtitle; or
       ``(2) another mechanism specified by the State to assure 
     decisionmaking and participation by low-income individuals in 
     the development, planning, and implementation of programs 
     funded under this subtitle.

     ``SEC. 677. PAYMENTS TO INDIAN TRIBES.

       ``(a) Reservation.--If, with respect to any State, the 
     Secretary--
       ``(1) receives a request from the governing body of an 
     Indian tribe or tribal organization within the State that 
     assistance under this subtitle be made directly to such tribe 
     or organization; and
       ``(2) determines that the members of such tribe or tribal 
     organization would be better served by means of grants made 
     directly to provide benefits under this subtitle,

     the Secretary shall reserve from amounts that would otherwise 
     be allotted to such State under section 675B for the fiscal 
     year the amount determined under subsection (b).
       ``(b) Determination of Reserved Amount.--The Secretary 
     shall reserve for the purpose of subsection (a) from amounts 
     that would otherwise be allotted to such State, not less than 
     100 percent of an amount that bears the same ratio to the 
     State allotment for the fiscal year involved as the 
     population of all eligible Indians for whom a determination 
     has been made under subsection (a) bears to the population of 
     all individuals eligible for assistance under this subtitle 
     in such State.
       ``(c) Awards.--The sums reserved by the Secretary on the 
     basis of a determination made under subsection (a) shall be 
     made available by grant to the Indian tribe or tribal 
     organization serving the individuals for whom such a 
     determination has been made.
       ``(d) Plan.--In order for an Indian tribe or tribal 
     organization to be eligible for a grant award for a fiscal 
     year under this section, the tribe or organization shall 
     submit to the Secretary a plan for such fiscal year that 
     meets such criteria as the Secretary may prescribe by 
     regulation.
       ``(e) Definitions.--In this section:
       ``(1) Indian tribe; tribal organization.--The terms `Indian 
     tribe' and `tribal organization' mean a tribe, band, or other 
     organized group recognized in the State in which the tribe, 
     band, or group resides, or considered by the Secretary of the 
     Interior, to be an Indian tribe or an Indian organization for 
     any purpose.
       ``(2) Indian.--The term `Indian' means a member of an 
     Indian tribe or of a tribal organization.

     ``SEC. 678. OFFICE OF COMMUNITY SERVICES.

       ``(a) Office.--The Secretary shall carry out the functions 
     of this subtitle through an Office of Community Services, 
     which shall be established in the Department of Health and 
     Human Services. The Office shall be headed by a Director.
       ``(b) Grants, Contracts, Cooperative Agreements.--The 
     Secretary shall carry out functions of this subtitle through 
     grants, contracts, or cooperative agreements.

[[Page S9075]]

     ``SEC. 678A. TRAINING AND TECHNICAL ASSISTANCE.

       ``(a) Activities.--The Secretary shall use the amounts 
     reserved in section 674(b)(2) for training, technical 
     assistance, planning, evaluation, and data collection 
     activities related to programs carried out under this 
     subtitle.
       ``(b) Process.--The process for determining the training 
     and technical assistance to be carried out under this section 
     shall--
       ``(1) ensure that the needs of eligible entities and 
     programs relating to improving program quality, including 
     financial management practices, are addressed to the maximum 
     extent feasible; and
       ``(2) incorporate mechanisms to ensure responsiveness to 
     local needs, including an ongoing procedure for obtaining 
     input from the national and State networks of eligible 
     entities.

     ``SEC. 678B. MONITORING OF ELIGIBLE ENTITIES.

       ``(a) In General.--In order to determine whether eligible 
     entities meet the performance goals, administrative 
     standards, financial management requirements, and other 
     requirements of a State, the State shall conduct the 
     following reviews of eligible entities:
       ``(1) A full onsite review of each such entity at least 
     once during each 3-year period.
       ``(2) An onsite review of each newly designated entity 
     immediately after the completion of the first year in which 
     such entity receives funds through the community services 
     block grant program.
       ``(3) Followup reviews including prompt return visits to 
     eligible entities, and their programs, that fail to meet the 
     goals, standards, and requirements established by the State.
       ``(4) Other reviews as appropriate, including reviews of 
     entities with programs that have had other Federal, State, or 
     local grants (other than assistance provided under this 
     subtitle) terminated for cause.
       ``(b) Requests.--The State may request training and 
     technical assistance from the Secretary as needed to comply 
     with the requirements of this section.

     ``SEC. 678C. CORRECTIVE ACTION; TERMINATION AND REDUCTION OF 
                   FUNDING.

       ``(a) Determination.--If the State determines, on the basis 
     of a review pursuant to subsection 678B, that an eligible 
     entity has had a failure described in section 676(c), the 
     State shall--
       ``(1) inform the entity of the deficiency to be corrected;
       ``(2) require the entity to correct the deficiency;
       ``(3)(A) offer training and technical assistance, if 
     appropriate, to help correct the deficiency, and prepare and 
     submit to the Secretary a report describing the training and 
     technical assistance offered; or
       ``(B) if the State determines that such training and 
     technical assistance are not appropriate, prepare and submit 
     to the Secretary a report stating the reasons for the 
     determination;
       ``(4)(A) at the discretion of the State (taking into 
     account the seriousness of the deficiency and the time 
     reasonably required to correct the deficiency), allow the 
     entity to develop and implement, within 60 days after being 
     informed of the deficiency, a quality improvement plan to 
     correct such deficiency within a reasonable period of time, 
     as determined by the State; and
       ``(B) not later than 30 days after receiving from an 
     eligible entity a proposed quality improvement plan pursuant 
     to subparagraph (A), either approve such proposed plan or 
     specify the reasons why the proposed plan cannot be approved; 
     and
       ``(5) after providing adequate notice and an opportunity 
     for a hearing, initiate proceedings to terminate the 
     designation of or reduce the funding under this subtitle of 
     the eligible entity unless the entity corrects the 
     deficiency.
       ``(b) Review.--A determination to terminate the designation 
     or reduce the funding of an eligible entity is reviewable by 
     the Secretary. The Secretary shall, upon request, review such 
     a determination. The review shall be completed not later than 
     60 days after the determination to terminate the designation 
     or reduce the funding. If the review is not completed within 
     60 days, the determination of the State shall become final at 
     the end of the 60th day.

     ``SEC. 678D. FISCAL CONTROLS, AUDITS, AND WITHHOLDING.

       ``(a) Fiscal Controls, Procedures, Audits, and 
     Inspections.--
       ``(1) In general.--A State that receives funds under this 
     subtitle shall--
       ``(A) establish fiscal control and fund accounting 
     procedures necessary to assure the proper disbursal of and 
     accounting for Federal funds paid to the State under this 
     subtitle, including procedures for monitoring the funds 
     provided under this subtitle;
       ``(B) ensure that cost and accounting standards of the 
     Office of Management and Budget apply to a recipient of funds 
     under this subtitle;
       ``(C) prepare, at least every year (or in the case of a 
     State with a 2-year State plan, every 2 years) in accordance 
     with paragraph (2) an audit of the expenditures of the State 
     of amounts received under this subtitle and amounts 
     transferred to carry out the purposes of this subtitle; and
       ``(D) make appropriate books, documents, papers, and 
     records available to the Secretary and the Comptroller 
     General of the United States, or any of their duly authorized 
     representatives, for examination, copying, or mechanical 
     reproduction on or off the premises of the appropriate entity 
     upon a reasonable request for the items.
       ``(2) Audits.--Each audit required by subsection (a)(1)(C) 
     shall be conducted by an entity independent of any agency 
     administering activities or services carried out under this 
     subtitle and shall be conducted in accordance with generally 
     accepted accounting principles. Within 30 days after the 
     completion of each such audit in a State, the chief executive 
     officer of the State shall submit a copy of such audit to any 
     eligible entity that was the subject of the audit at no 
     charge, to the legislature of the State, and to the 
     Secretary.
       ``(3) Repayments.--The State shall repay to the United 
     States amounts found not to have been expended in accordance 
     with this subtitle or the Secretary may offset such amounts 
     against any other amount to which the State is or may become 
     entitled under this subtitle.
       ``(b) Withholding.--
       ``(1) In general.--The Secretary shall, after providing 
     adequate notice and an opportunity for a hearing conducted 
     within the affected State, withhold funds from any State that 
     does not utilize the State allotment in accordance with the 
     provisions of this subtitle, including the assurances such 
     State provided under section 676.
       ``(2) Response to complaints.--The Secretary shall respond 
     in an expeditious and speedy manner to complaints of a 
     substantial or serious nature that a State has failed to use 
     funds in accordance with the provisions of this subtitle, 
     including the assurances provided by the State under section 
     676. For purposes of this paragraph, a complaint of a failure 
     to meet any one of the assurances provided under section 676 
     that constitutes disregarding that assurance shall be 
     considered to be a complaint of a serious nature.
       ``(3) Investigations.--Whenever the Secretary determines 
     that there is a pattern of complaints of failures described 
     in paragraph (2) from any State in any fiscal year, the 
     Secretary shall conduct an investigation of the use of funds 
     received under this subtitle by such State in order to ensure 
     compliance with the provisions of this subtitle.

     ``SEC. 678E. ACCOUNTABILITY AND REPORTING REQUIREMENTS.

       ``(a) State Accountability and Reporting Requirements.--
       ``(1) Performance measurement.--
       ``(A) In general.--By October 1, 2001, each State that 
     receives funds under this subtitle shall participate, and 
     shall ensure that all eligible entities in the State 
     participate, in a performance measurement system, which may 
     be a performance measurement system established by the 
     Secretary pursuant to subsection (b), or an alternative 
     system that the Secretary is satisfied meets the requirements 
     of subsection (b).
       ``(B) Local agencies.--The State may elect to have local 
     agencies that are subcontractors of the eligible entities 
     under this subtitle participate in the performance 
     measurement system. If the State makes that election, 
     references in this section to eligible entities shall be 
     considered to include the local agencies.
       ``(2) Annual report.--Each State shall annually prepare and 
     submit to the Secretary a report on the measured performance 
     of the State and the eligible entities in the State. Prior to 
     the participation of the State in the performance measurement 
     system, the State shall include in the report any information 
     collected by the State relating to such performance. Each 
     State shall also include in the report an accounting of the 
     expenditure of funds received by the State through the 
     community services block grant program, including an 
     accounting of funds spent on administrative costs by the 
     State and the eligible entities, and funds spent by eligible 
     entities on the direct delivery of local services, and shall 
     include information on the number of and characteristics of 
     clients served under this subtitle in the State, based on 
     data collected from the eligible entities. The State shall 
     also include in the report a summary describing the training 
     and technical assistance offered by the State under section 
     678C(a)(3) during the year covered by the report.
       ``(b) Secretary's Accountability and Reporting 
     Requirements.--
       ``(1) Performance measurement.--The Secretary, in 
     collaboration with the States and with eligible entities 
     throughout the Nation, shall establish one or more model 
     performance measurement systems, which may be used by the 
     States and by eligible entities to measure their performance 
     in carrying out the requirements of this subtitle and in 
     achieving the goals of community action plans. The Secretary 
     shall provide technical assistance, including support for the 
     enhancement of electronic data systems, to States and to 
     eligible entities to enhance their capability to collect and 
     report data for such a system and to aid in their 
     participation in such a system.
       ``(2) Reporting requirements.--At the end of each fiscal 
     year beginning after September 30, 1999, the Secretary shall, 
     directly or by grant or contract, prepare a report containing 
     each of the following elements:
       ``(A) A summary of the planned use of funds by each State, 
     and the eligible entities in the State, under the community 
     services block grant program, as contained in each State plan 
     submitted pursuant to section 676.
       ``(B) A description of how funds were actually spent by the 
     State and eligible entities in the State, including a 
     breakdown of funds spent on administrative costs and on the 
     direct delivery of local services by eligible entities.
       ``(C) Information on the number of entities eligible for 
     funds under this subtitle, the number of low-income persons 
     served under this subtitle, and such demographic data on the 
     low-income populations served by eligible entities as is 
     determined by the Secretary to be feasible.
       ``(D) A comparison of the planned uses of funds for each 
     State and the actual uses of the funds.
       ``(E) A summary of each State's performance results, and 
     the results for the eligible entities, as collected and 
     submitted by the States in accordance with subsection (a)(2).
       ``(F) Any additional information that the Secretary 
     considers to be appropriate to carry out this subtitle, if 
     the Secretary informs the States

[[Page S9076]]

     of the need for such additional information and allows a 
     reasonable period of time for the States to collect and 
     provide the information.
       ``(3) Submission.--The Secretary shall submit to the 
     Committee on Education and the Workforce of the House of 
     Representatives and the Committee on Labor and Human 
     Resources of the Senate the report described in paragraph 
     (2), and any comments the Secretary may have with respect to 
     such report. The report shall include definitions of direct, 
     indirect, and administrative costs used by the Department of 
     Health and Human Services for programs funded under this 
     subtitle.
       ``(4) Costs.--Of the funds reserved under section 
     674(b)(3), not more than $350,000 shall be available to carry 
     out the reporting requirements contained in paragraph (2) and 
     the provision of technical assistance described in paragraph 
     (1).

     ``SEC. 678F. LIMITATIONS ON USE OF FUNDS.

       ``(a) Construction of Facilities.--
       ``(1) Limitations.--Except as provided in paragraph (2), 
     grants made under this subtitle (other than amounts reserved 
     under section 674(b)(3)) may not be used by the State, or by 
     any other person with which the State makes arrangements to 
     carry out the purposes of this subtitle, for the purchase or 
     improvement of land, or the purchase, construction, or 
     permanent improvement (other than low-cost residential 
     weatherization or other energy-related home repairs) of any 
     building or other facility.
       ``(2) Waiver.--The Secretary may waive the limitation 
     contained in paragraph (1) upon a State request for such a 
     waiver, if the Secretary finds that the request describes 
     extraordinary circumstances to justify the purchase of land 
     or the construction of facilities (or the making of permanent 
     improvements) and that permitting the waiver will contribute 
     to the ability of the State to carry out the purposes of this 
     subtitle.
       ``(b) Political Activities.--
       ``(1) Treatment as a state or local agency.--For purposes 
     of chapter 15 of title 5, United States Code, any entity that 
     assumes responsibility for planning, developing, and 
     coordinating activities under this subtitle and receives 
     assistance under this subtitle shall be deemed to be a State 
     or local agency. For purposes of paragraphs (1) and (2) of 
     section 1502(a) of such title, any entity receiving 
     assistance under this subtitle shall be deemed to be a State 
     or local agency.
       ``(2) Prohibitions.--Programs assisted under this subtitle 
     shall not be carried on in a manner involving the use of 
     program funds, the provision of services, or the employment 
     or assignment of personnel, in a manner supporting or 
     resulting in the identification of such programs with--
       ``(A) any partisan or nonpartisan political activity or any 
     political activity associated with a candidate, or contending 
     faction or group, in an election for public or party office;
       ``(B) any activity to provide voters or prospective voters 
     with transportation to the polls or similar assistance in 
     connection with any such election; or
       ``(C) any voter registration activity.
       ``(3) Rules and regulations.--The Secretary, after 
     consultation with the Office of Personnel Management, shall 
     issue rules and regulations to provide for the enforcement of 
     this subsection, which shall include provisions for summary 
     suspension of assistance or other action necessary to permit 
     enforcement on an emergency basis.
       ``(c) Nondiscrimination.--
       ``(1) In general.--No person shall, on the basis of race, 
     color, national origin, or sex be excluded from participation 
     in, be denied the benefits of, or be subjected to 
     discrimination under, any program or activity funded in whole 
     or in part with funds made available under this subtitle. Any 
     prohibition against discrimination on the basis of age under 
     the Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.) 
     or with respect to an otherwise qualified individual with a 
     disability as provided in section 504 of the Rehabilitation 
     Act of 1973 (29 U.S.C. 794), or title II of the Americans 
     with Disabilities Act of 1990 (42 U.S.C. 12131 et seq.) shall 
     also apply to any such program or activity.
       ``(2) Action of secretary.--Whenever the Secretary 
     determines that a State that has received a payment under 
     this subtitle has failed to comply with paragraph (1) or an 
     applicable regulation, the Secretary shall notify the chief 
     executive officer of the State and shall request that the 
     officer secure compliance. If within a reasonable period of 
     time, not to exceed 60 days, the chief executive officer 
     fails or refuses to secure compliance, the Secretary is 
     authorized to--
       ``(A) refer the matter to the Attorney General with a 
     recommendation that an appropriate civil action be 
     instituted;
       ``(B) exercise the powers and functions provided by title 
     VI of the Civil Rights Act of 1964 (42 U.S.C. 2000d et seq.), 
     the Age Discrimination Act of 1975 (42 U.S.C. 6101 et seq.), 
     section 504 of the Rehabilitation Act of 1973 (29 U.S.C. 
     794), or title II of the Americans with Disabilities Act of 
     1990 (42 U.S.C. 12131), as may be applicable; or
       ``(C) take such other action as may be provided by law.
       ``(3) Action of attorney general.--When a matter is 
     referred to the Attorney General pursuant to paragraph (2), 
     or whenever the Attorney General has reason to believe that 
     the State is engaged in a pattern or practice of 
     discrimination in violation of the provisions of this 
     subsection, the Attorney General may bring a civil action in 
     any appropriate United States district court for such relief 
     as may be appropriate, including injunctive relief.

     ``SEC. 679. OPERATIONAL RULE.

       ``(a) Faith-Based Organizations Included as Nongovernmental 
     Providers.--For any program carried out by the Federal 
     Government, or by a State or local government under this 
     subtitle, the government shall consider, on the same basis as 
     other nongovernmental organizations, faith-based 
     organizations to provide the assistance under the program, so 
     long as the program is implemented in a manner consistent 
     with the Establishment Clause of the first amendment to the 
     Constitution. Neither the Federal Government nor a State or 
     local government receiving funds under this subtitle shall 
     discriminate against an organization that provides assistance 
     under, or applies to provide assistance under, this subtitle, 
     on the basis that the organization has a faith-based 
     character.
       ``(c) Faith-Based Character and Independence.--
       ``(1) In general.--A faith-based organization that provides 
     assistance under a program described in subsection (a) shall 
     retain its faith-based character and control over the 
     definition, development, practice, and expression of its 
     faith-based beliefs.
       ``(2) Additional safeguards.--Neither the Federal 
     Government nor a State or local government shall require a 
     faith-based organization--
       ``(A) to alter its form of internal governance, except (for 
     purposes of administration of the community services block 
     grant program) as provided in section 676B; or
       ``(B) to remove religious art, icons, scripture, or other 
     symbols;

     in order to be eligible to provide assistance under a program 
     described in subsection (a).
       ``(3) Tenets and teachings.--A faith-based organization 
     that provides assistance under a program described in 
     subsection (a) may require that employees adhere to the 
     religious tenets and teachings of such organization, and such 
     organization may require that employees adhere to rules 
     forbidding the use of drugs or alcohol.
       ``(c) Limitations on Use of Funds for Certain Purposes.--No 
     funds provided through a grant or contract to a faith-based 
     organization to provide assistance under any program 
     described in subsection (a) shall be expended for sectarian 
     worship, instruction, or proselytization.
       ``(d) Fiscal Accountability.--
       ``(1) In general.--Except as provided in paragraph (2), any 
     faith-based organization providing assistance under any 
     program described in subsection (a) shall be subject to the 
     same regulations as other nongovernmental organizations to 
     account in accord with generally accepted accounting 
     principles for the use of such funds provided under such 
     program.
       ``(2) Limited audit.--Such organization shall segregate 
     government funds provided under such program into a separate 
     account. Only the government funds shall be subject to audit 
     by the government.
       ``(e) Treatment of Eligible Entities and Other Intermediate 
     Organizations.--If an eligible entity or other organization 
     (referred to in this subsection as an `intermediate 
     organization'), acting under a contract, or grant or other 
     agreement, with the Federal Government or a State or local 
     government, is given the authority under the contract or 
     agreement to select nongovernmental organizations to provide 
     assistance under the programs described in subsection (a), 
     the intermediate organization shall have the same duties 
     under this section as the government.

     ``SEC. 680. DISCRETIONARY AUTHORITY OF THE SECRETARY.

       ``(a) Grants, Contracts, Arrangements, Loans, and 
     Guarantees.--
       ``(1) In general.--The Secretary shall, from funds reserved 
     under section 674(b)(3), make grants, loans, or guarantees to 
     States and public agencies and private, nonprofit 
     organizations, or enter into contracts or jointly financed 
     cooperative arrangements with States and public agencies and 
     private, nonprofit organizations (and for-profit 
     organizations, to the extent specified in paragraph (2)(E)) 
     for each of the objectives described in paragraphs (2) 
     through (4).
       ``(2) Community economic development.--
       ``(A) Economic development activities.--The Secretary shall 
     make grants described in paragraph (1) on a competitive basis 
     to private, nonprofit organizations that are community 
     development corporations to enable the corporations to 
     provide technical and financial assistance for economic 
     development activities designed to address the economic needs 
     of low-income individuals and families by creating employment 
     and business development opportunities.
       ``(B) Consultation.--The Secretary shall exercise the 
     authority provided under subparagraph (A) after consultation 
     with other relevant Federal officials.
       ``(C) Governing boards.--For a community development 
     corporation to receive funds to carry out this paragraph, the 
     corporation shall be governed by a board that shall consist 
     of residents of the community and business and civic leaders 
     and shall have as a principal purpose planning, developing, 
     or managing low-income housing or community development 
     projects.
       ``(D) Geographic distribution.--In making grants to carry 
     out this paragraph, the Secretary shall take into 
     consideration the geographic distribution of funding among 
     States and the relative proportion of funding among rural and 
     urban areas.
       ``(E) Reservation.--Of the amounts made available to carry 
     out this paragraph, the Secretary may reserve not more than 1 
     percent for each fiscal year to make grants to private, 
     nonprofit organizations, or to enter into contracts with 
     private, nonprofit or for-profit organizations, to enable the 
     organizations involved to provide technical assistance to aid 
     community development corporations in developing or 
     implementing activities funded to carry out this paragraph 
     and to evaluate activities funded to carry out this 
     paragraph.

[[Page S9077]]

       ``(3) Rural community development activities.--The 
     Secretary shall provide the assistance described in paragraph 
     (1) for rural community development activities, which shall 
     include providing--
       ``(A) grants to private, nonprofit corporations to enable 
     the corporations to provide assistance concerning home repair 
     to rural low-income families and concerning planning and 
     developing low-income rural rental housing units; and
       ``(B) grants to multistate, regional, private, nonprofit 
     organizations to enable the organizations to provide training 
     and technical assistance to small, rural communities 
     concerning meeting their community facility needs.
       ``(4) Neighborhood innovation projects.--The Secretary 
     shall provide the assistance described in paragraph (1) for 
     neighborhood innovation projects, which shall include 
     providing grants to neighborhood-based private, nonprofit 
     organizations to test or assist in the development of new 
     approaches or methods that will aid in overcoming special 
     problems identified by communities or neighborhoods or 
     otherwise assist in furthering the purposes of this subtitle, 
     and which may include providing assistance for projects that 
     are designed to serve low-income individuals and families who 
     are not being effectively served by other programs.
       ``(b) Evaluation.--The Secretary shall require all 
     activities receiving assistance under this section to be 
     evaluated for their effectiveness. Funding for such 
     evaluations shall be provided as a stated percentage of the 
     assistance or through a separate grant awarded by the 
     Secretary specifically for the purpose of evaluation of a 
     particular activity or group of activities.
       ``(c) Annual Report.--The Secretary shall compile an annual 
     report containing a summary of the evaluations required in 
     subsection (b) and a listing of all activities assisted under 
     this section. The Secretary shall annually submit the report 
     to the Chairperson of the Committee on Education and the 
     Workforce of the House of Representatives and the Chairperson 
     of the Committee on Labor and Human Resources of the Senate.

     ``SEC. 681. COMMUNITY FOOD AND NUTRITION PROGRAMS.

       ``(a) Grants.--The Secretary may, through grants to public 
     and private, nonprofit agencies, provide for community-based, 
     local, statewide, and national programs--
       ``(1) to coordinate private and public food assistance 
     resources, wherever the grant recipient involved determines 
     such coordination to be inadequate, to better serve low-
     income populations;
       ``(2) to assist low-income communities to identify 
     potential sponsors of child nutrition programs and to 
     initiate such programs in underserved or unserved areas; and
       ``(3) to develop innovative approaches at the State and 
     local level to meet the nutrition needs of low-income 
     individuals.
       ``(b) Allotments and Distribution of Funds.--
       ``(1) Not to exceed $6,000,000 in appropriations.--Of the 
     amount appropriated for a fiscal year to carry out this 
     section (but not to exceed $6,000,000), the Secretary shall 
     distribute funds for grants under subsection (a) as follows:
       ``(A) Allotments.--From a portion equal to 60 percent of 
     such amount (but not to exceed $3,600,000), the Secretary 
     shall allot for grants to eligible agencies for statewide 
     programs in each State the amount that bears the same ratio 
     to such portion as the low-income and unemployed population 
     of such State bears to the low-income and unemployed 
     population of all the States.
       ``(B) Competitive grants.--From a portion equal to 40 
     percent of such amount (but not to exceed $2,400,000), the 
     Secretary shall make grants on a competitive basis to 
     eligible agencies for local and statewide programs.
       ``(2) Greater available appropriations.--Any amounts 
     appropriated for a fiscal year to carry out this section in 
     excess of $6,000,000 shall be allotted as follows:
       ``(A) Allotments.--The Secretary shall use 40 percent of 
     such excess to make allotments for grants under subsection 
     (a) to eligible agencies for statewide programs in each State 
     in an amount that bears the same ratio to 40 percent of such 
     excess as the low-income and unemployed population of such 
     State bears to the low-income and unemployed population of 
     all the States.
       ``(B) Competitive grants for local and statewide 
     programs.--The Secretary shall use 40 percent of such excess 
     to make grants under subsection (a) on a competitive basis to 
     eligible agencies for local and statewide programs.
       ``(C) Competitive grants for nationwide programs.--The 
     Secretary shall use the remaining 20 percent of such excess 
     to make grants under subsection (a) on a competitive basis to 
     eligible agencies for nationwide programs, including programs 
     benefiting Indians as defined in section 677 and migrant or 
     seasonal farmworkers.
       ``(3) Eligibility for allotments for statewide programs.--
     To be eligible to receive an allotment under paragraph (1)(A) 
     or (2)(A), an eligible agency shall demonstrate that the 
     proposed program is statewide in scope and represents a 
     comprehensive and coordinated effort to alleviate hunger 
     within the State.
       ``(4) Minimum allotments for statewide programs.--
       ``(A) In general.--From the amounts allotted under 
     paragraphs (1)(A) and (2)(A), the minimum total allotment for 
     each State for each fiscal year shall be--
       ``(i) $15,000 if the total amount appropriated to carry out 
     this section is not less than $7,000,000 but less than 
     $10,000,000;
       ``(ii) $20,000 if the total amount appropriated to carry 
     out this section is not less than $10,000,000 but less than 
     $15,000,000; or
       ``(iii) $30,000 if the total amount appropriated to carry 
     out this section is not less than $15,000,000.
       ``(B) Definition.--In this paragraph, the term `State' does 
     not include Guam, American Samoa, the United States Virgin 
     Islands, the Commonwealth of the Northern Mariana Islands, or 
     the Freely Associated States.
       ``(5) Maximum grants.--From funds made available under 
     paragraphs (1)(B) and (2)(B) for any fiscal year, the 
     Secretary may not make grants under subsection (a) to an 
     eligible agency in an aggregate amount exceeding $50,000. 
     From funds made available under paragraph (2)(C) for any 
     fiscal year, the Secretary may not make grants under 
     subsection (a) to an eligible agency in an aggregate amount 
     exceeding $300,000.
       ``(c) Report.--For each fiscal year, the Secretary shall 
     prepare and submit, to the Committee on Education and the 
     Workforce of the House of Representatives and the Committee 
     on Labor and Human Resources of the Senate, a report 
     concerning the grants made under this section. Such report 
     shall include--
       ``(1) a list of grant recipients;
       ``(2) information on the amount of funding awarded to each 
     grant recipient; and
       ``(3) a summary of the activities performed by the grant 
     recipients with funding awarded under this section and a 
     description of the manner in which such activities meet the 
     objectives described in subsection (a).
       ``(d) Authorization of Appropriations.--There are 
     authorized to be appropriated to carry out this section 
     $25,000,000 for fiscal year 1999, and such sums as may be 
     necessary for each of fiscal years 2000 through 2003.

     ``SEC. 682. NATIONAL OR REGIONAL PROGRAMS DESIGNED TO PROVIDE 
                   INSTRUCTIONAL ACTIVITIES FOR LOW-INCOME YOUTH.

       ``(a) General Authority.--The Secretary is authorized to 
     make a grant to an eligible service provider to administer 
     national or regional programs to provide instructional 
     activities for low-income youth. In making such a grant, the 
     Secretary shall give priority to eligible service providers 
     that have a demonstrated ability to operate such a program.
       ``(b) Program Requirements.--Any instructional activity 
     carried out by an eligible service provider receiving a grant 
     under this section shall be carried out on the campus of an 
     institution of higher education (as defined in section 
     1201(a) of the Higher Education Act of 1965 (20 U.S.C. 
     1141(a))) and shall include--
       ``(1) access to the facilities and resources of such an 
     institution;
       ``(2) an initial medical examination and follow-up referral 
     or treatment, without charge, for youth during their 
     participation in such activity;
       ``(3) at least one nutritious meal daily, without charge, 
     for participating youth during each day of participation;
       ``(4) high quality instruction in a variety of sports (that 
     shall include swimming and that may include dance and any 
     other high quality recreational activity) provided by coaches 
     and teachers from institutions of higher education and from 
     elementary and secondary schools (as defined in section 14101 
     of the Elementary and Secondary Education Act of 1965 (20 
     U.S.C. 8801)); and
       ``(5) enrichment instruction and information on matters 
     relating to the well-being of youth, to include educational 
     opportunities and information on study practices, education 
     for the prevention of drug and alcohol abuse, and information 
     on health and nutrition, career opportunities, and family and 
     job responsibilities.
       ``(c) Advisory Committee; Partnerships.--The eligible 
     service provider shall, in each community in which a program 
     is funded under this section--
       ``(1) ensure that--
       ``(A) a community-based advisory committee is established, 
     with representatives from local youth, family, and social 
     service organizations, schools, entities providing park and 
     recreation services, and other community-based organizations 
     serving high-risk youth; or
       ``(B) an existing community-based advisory board, 
     commission, or committee with similar membership is utilized 
     to serve as the committee described in subparagraph (A); and
       ``(2) enter into formal partnerships with youth-serving 
     organizations or other appropriate social service entities in 
     order to link program participants with year-round services 
     in their home communities that support and continue the 
     objectives of this subtitle.
       ``(d) Eligible Providers.--A service provider that is a 
     national private, nonprofit organization, a coalition of such 
     organizations, or a private, nonprofit organization applying 
     jointly with a business concern shall be eligible to apply 
     for a grant under this section if--
       ``(1) the applicant has demonstrated experience in 
     operating a program providing instruction to low-income 
     youth;
       ``(2) the applicant agrees to contribute an amount (in cash 
     or in kind, fairly evaluated) of not less than 25 percent of 
     the amount requested, for the program funded through the 
     grant;
       ``(3) the applicant agrees to use no funds from a grant 
     authorized under this section for administrative expenses; 
     and
       ``(4) the applicant agrees to comply with the regulations 
     or program guidelines promulgated by the Secretary for use of 
     funds made available through the grant.
       ``(e) Applications Process.--To be eligible to receive a 
     grant under this section, a service provider shall submit to 
     the Secretary, for approval, an application at such time, in 
     such manner, and containing such information as the Secretary 
     may require.
       ``(f) Promulgation of Regulations or Program Guidelines.--
     The Secretary shall promulgate regulations or program 
     guidelines to ensure funds made available through a grant 
     made

[[Page S9078]]

     under this section are used in accordance with the objectives 
     of this subtitle.
       ``(g) Authorization of Appropriations.--There is authorized 
     to be appropriated $15,000,000 for each of fiscal years 1999 
     through 2003 for grants to carry out this section.

     ``SEC. 683. REFERENCES.

       ``Any reference in any provision of law to the poverty line 
     set forth in section 624 or 625 of the Economic Opportunity 
     Act of 1964 shall be construed to be a reference to the 
     poverty line defined in section 673. Any reference in any 
     provision of law to any community action agency designated 
     under title II of the Economic Opportunity Act of 1964 shall 
     be construed to be a reference to an entity eligible to 
     receive funds under the community services block grant 
     program.''.

     SEC. 202. CONFORMING AMENDMENTS.

       (a) Older Americans Act of 1965.--Section 306(a)(6)(E)(ii) 
     of the Older Americans Act of 1965 (42 U.S.C. 
     3026(a)(6)(E)(ii)) is amended by striking ``section 675(c)(3) 
     of the Community Services Block Grant Act (42 U.S.C. 
     9904(c)(3))'' and inserting ``section 676B of the Community 
     Services Block Grant Act''.
       (b) Anti-Drug Abuse Act of 1988.--Section 3521(c)(2) of the 
     Anti-Drug Abuse Act of 1988 (42 U.S.C. 11841(c)(2)) is 
     amended by striking ``, such as activities authorized by 
     section 681(a)(2)(F) of the Community Services Block Grant 
     Act (42 U.S.C. section 9910(a)(2)(F)),''.

     SEC. 203. REPEALERS.

       (a) Community Economic Development Act of 1981.--The 
     Community Economic Development Act of 1981 (42 U.S.C. 9801 et 
     seq.) is repealed.
       (b) Human Services Reauthorization Act of 1986.--Sections 
     407 and 408 of the Human Services Reauthorization Act of 1986 
     (42 U.S.C 9812a and 9910b) are repealed.

              TITLE III--LOW-INCOME HOME ENERGY ASSISTANCE

     SEC. 301. AUTHORIZATION.

       (a) In General.--Section 2602(b) of the Low-Income Home 
     Energy Assistance Act of 1981 (42 U.S.C. 8621(b)) is 
     amended--
       (1) by striking ``are authorized'' and inserting ``is 
     authorized''; and
       (2) by striking ``fiscal years 1995 through 1999'' and 
     inserting ``fiscal years 1999 through 2004''.
       (b) Program Year.--Section 2602(c) of such Act (42 U.S.C. 
     8621(c)) is amended to read as follows:
       ``(c) Amounts appropriated under this section for any 
     fiscal year for programs and activities under this title 
     shall be made available for obligation in the succeeding 
     fiscal year.''.
       (c) Incentive Program for Leveraging Non-Federal 
     Resources.--Section 2602(d) of such Act (42 U.S.C. 8621(d)) 
     is amended--
       (1) by striking ``(d)'' and inserting ``(d)(1)'';
       (2) by striking ``are authorized'' and inserting ``is 
     authorized'';
       (3) by striking ``$50,000,000'' and all that follows and 
     inserting the following: ``$30,000,000 for each of fiscal 
     years 1999 through 2004, except as provided in paragraph 
     (2).''; and
       (4) by adding at the end the following:
       ``(2) For any of fiscal years 1999 through 2004 for which 
     the amount appropriated under subsection (b) is not less than 
     $1,400,000,000, there is authorized to be appropriated 
     $50,000,000 to carry out section 2607A.''.
       (d) Technical Amendments.--Section 2602(e) of such Act (42 
     U.S.C. 8621(e)) is amended--
       (1) by striking ``are authorized'' and inserting ``is 
     authorized''; and
       (2) by striking ``subsection (g)'' and inserting 
     ``subsection (e) of such section''.

     SEC. 302. DEFINITIONS.

       Section 2603(4) of the Low-Income Home Energy Assistance 
     Act of 1981 (42 U.S.C. 8622(4)) is amended--
       (1) by striking ``the term'' and inserting ``The term''; 
     and
       (2) by striking the semicolon and inserting a period.

     SEC. 303. NATURAL DISASTERS AND OTHER EMERGENCIES.

       Section 2603 of the Low-Income Home Energy Assistance Act 
     of 1981 (42 U.S.C. 8622) is amended--
       (1) by redesignating paragraphs (6) through (9) as 
     paragraphs (8) through (11), respectively;
       (2) by inserting before paragraph (8) (as redesignated in 
     paragraph (1)) the following:
       ``(7) Natural disaster.--The term `natural disaster' means 
     a weather event (relating to cold or hot weather), flood, 
     earthquake, tornado, hurricane, or ice storm, or an event 
     meeting such other criteria as the Secretary, in the 
     discretion of the Secretary, may determine to be 
     appropriate.'';
       (3) by redesignating paragraphs (1) through (5) as 
     paragraphs (2) through (6), respectively; and
       (4) by inserting before paragraph (2) (as redesignated in 
     paragraph (3)) the following:
       ``(1) Emergency.--The term `emergency' means--
       ``(A) a natural disaster;
       ``(B) a significant home energy supply shortage or 
     disruption;
       ``(C) a significant increase in the cost of home energy, as 
     determined by the Secretary;
       ``(D) a significant increase in home energy disconnections 
     reported by a utility, a State regulatory agency, or another 
     agency with necessary data;
       ``(E) a significant increase in participation in a public 
     benefit program such as the food stamp program carried out 
     under the Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.), the 
     national program to provide supplemental security income 
     carried out under title XVI of the Social Security Act (42 
     U.S.C. 1381 et seq.), or the State temporary assistance for 
     needy families program carried out under part A of title IV 
     of the Social Security Act (42 U.S.C. 601 et seq.), as 
     determined by the head of the appropriate Federal agency;
       ``(F) a significant increase in unemployment, layoffs, or 
     the number of households with an individual applying for 
     unemployment benefits, as determined by the Secretary of 
     Labor; or
       ``(G) an event meeting such criteria as the Secretary, in 
     the discretion of the Secretary, may determine to be 
     appropriate.''.

     SEC. 304. STATE ALLOTMENTS.

       Section 2604 of the Low-Income Home Energy Assistance Act 
     of 1981 (42 U.S.C. 8623) is amended--
       (1) in subsection (b)(1), by striking ``the Northern 
     Mariana Islands, and the Trust Territory of the Pacific 
     Islands.'' and inserting ``the Commonwealth of the Northern 
     Mariana Islands, and the combined Freely Associated 
     States.'';
       (2) in subsection (c)(3)(B)(ii), by striking 
     ``application'' and inserting ``applications'';
       (3) by striking subsection (f);
       (4) in subsection (g)--
       (A) in the first sentence, by striking ``(a) through (f)'' 
     and inserting ``(a) through (d)''; and
       (B) by striking the last two sentences and inserting the 
     following: ``In determining whether to make such an allotment 
     to a State, the Secretary shall take into account the extent 
     to which the State was affected by the natural disaster or 
     other emergency involved, the availability to the State of 
     other resources under the program carried out under this 
     title or any other program, whether a Member of Congress has 
     requested that the State receive the allotment, and such 
     other factors as the Secretary may find to be relevant. Not 
     later than 30 days after making the determination, but prior 
     to releasing an allotted amount to a State, the Secretary 
     shall notify Congress of the allotments made pursuant to this 
     subsection.''; and
       (5) by redesignating subsection (g) as subsection (e).

     SEC. 305. ADMINISTRATION.

       Section 2605 of the Low-Income Home Energy Assistance Act 
     of 1981 (42 U.S.C. 8624) is amended--
       (1) in subsection (b)--
       (A) in paragraph (9)(A), by striking ``and not transferred 
     pursuant to section 2604(f) for use under another block 
     grant'';
       (B) in paragraph (14), by striking ``; and'' and inserting 
     a semicolon;
       (C) in the matter following paragraph (14), by striking 
     ``The Secretary may not prescribe the manner in which the 
     States will comply with the provisions of this subsection.''; 
     and
       (D) in the matter following paragraph (16), by inserting 
     before ``The Secretary shall issue'' the following: ``The 
     Secretary may not prescribe the manner in which the States 
     will comply with the provisions of this subsection.''; and
       (2) in subsection (c)(1)--
       (A) in subparagraph (B), by striking ``States'' and 
     inserting ``State''; and
       (B) in subparagraph (G)(i), by striking ``has'' and 
     inserting ``had''.

     SEC. 306. PAYMENTS TO STATES.

       Section 2607(b)(2)(B) of the Low-Income Home Energy 
     Assistance Act of 1981 (42 U.S.C. 8626(b)(2)(B)) is amended--
       (1) in the first sentence, by striking ``and not 
     transferred pursuant to section 2604(f)''; and
       (2) in the second sentence, by striking ``but not 
     transferred by the State''.

     SEC. 307. RESIDENTIAL ENERGY ASSISTANCE CHALLENGE OPTION.

       (a) Evaluation.--The Comptroller General of the United 
     States shall conduct an evaluation of the Residential Energy 
     Assistance Challenge program described in section 2607B of 
     the Low-Income Home Energy Assistance Act of 1981 (42 U.S.C. 
     8626b).
       (b) Report.--Not later than 2 years after the date of 
     enactment of this Act, the Comptroller General of the United 
     States shall prepare and submit to Congress a report 
     containing--
       (1) the findings resulting from the evaluation described in 
     subsection (a); and
       (2) the State evaluations described in paragraphs (1) and 
     (2) of subsection (b) of such section 2607B.
       (c) Incentive Grants.--Section 2607B(b)(1) of the Low-
     Income Home Energy Assistance Act of 1981 (42 U.S.C. 
     8626b(b)(1)) is amended by striking ``For each of the fiscal 
     years 1996 through 1999'' and inserting ``For each fiscal 
     year''.
       (d) Technical Amendments.--Section 2607B of such Act (42 
     U.S.C. 8626b) is amended--
       (1) in subsection (e)(2)--
       (A) by redesignating subparagraphs (F) through (N) as 
     subparagraphs (E) through (M), respectively; and
       (B) in clause (i) of subparagraph (I) (as redesignated in 
     subparagraph (A)), by striking ``on'' and inserting ``of''; 
     and
       (2) by redesignating subsection (g) as subsection (f).

     SEC. 308. TECHNICAL ASSISTANCE, TRAINING, AND COMPLIANCE 
                   REVIEWS.

       (a) In General.--Section 2609A(a) of the Low-Income Home 
     Energy Assistance Act of 1981 (42 U.S.C. 8628a(a)) is 
     amended--
       (1) in the matter preceding paragraph (1)--
       (A) by striking ``$250,000'' and inserting ``$300,000''; 
     and
       (B) by striking ``Secretary--'' and inserting ``Secretary 
     to conduct onsite compliance reviews of programs supported 
     under this title or--''; and
       (2) in paragraph (2)--
       (A) by inserting ``or interagency agreements'' after 
     ``cooperative arrangements''; and
       (B) by inserting ``(including Federal agencies)'' after 
     ``public agencies''.
       (b) Conforming Amendment.--The section heading of section 
     2609A of such Act (42 U.S.C. 8628a) is amended to read as 
     follows:

[[Page S9079]]

      ``technical assistance, training, and compliance reviews''.

                   TITLE IV--ASSETS FOR INDEPENDENCE

     SEC. 401. SHORT TITLE.

       This title may be cited as the ``Assets for Independence 
     Act''.

     SEC. 402. FINDINGS.

       Congress makes the following findings:
       (1) Economic well-being does not come solely from income, 
     spending, and consumption, but also requires savings, 
     investment, and accumulation of assets because assets can 
     improve economic independence and stability, connect 
     individuals with a viable and hopeful future, stimulate 
     development of human and other capital, and enhance the 
     welfare of offspring.
       (2) Fully \1/2\ of all Americans have either no, 
     negligible, or negative assets available for investment, just 
     as the price of entry to the economic mainstream, the cost of 
     a house, an adequate education, and starting a business, is 
     increasing. Further, the household savings rate of the United 
     States lags far behind other industrial nations, presenting a 
     barrier to economic growth.
       (3) In the current tight fiscal environment, the United 
     States should invest existing resources in high-yield 
     initiatives. There is reason to believe that the financial 
     returns, including increased income, tax revenue, and 
     decreased welfare cash assistance, resulting from individual 
     development accounts will far exceed the cost of investment 
     in those accounts.
       (4) Traditional public assistance programs concentrating on 
     income and consumption have rarely been successful in 
     promoting and supporting the transition to increased economic 
     self-sufficiency. Income-based domestic policy should be 
     complemented with asset-based policy because, while income-
     based policies ensure that consumption needs (including food, 
     child care, rent, clothing, and health care) are met, asset-
     based policies provide the means to achieve greater 
     independence and economic well-being.

     SEC. 403. PURPOSES.

       The purposes of this title are to provide for the 
     establishment of demonstration projects designed to 
     determine--
       (1) the social, civic, psychological, and economic effects 
     of providing to individuals and families with limited means 
     an incentive to accumulate assets by saving a portion of 
     their earned income;
       (2) the extent to which an asset-based policy that promotes 
     saving for postsecondary education, homeownership, and 
     microenterprise development may be used to enable individuals 
     and families with limited means to increase their economic 
     self-sufficiency; and
       (3) the extent to which an asset-based policy stabilizes 
     and improves families and the community in which they live.

     SEC. 404. DEFINITIONS.

       In this title:
       (1) Applicable period.--The term ``applicable period'' 
     means, with respect to amounts to be paid from a grant made 
     for a project year, the calendar year immediately preceding 
     the calendar year in which the grant is made.
       (2) Eligible individual.--The term ``eligible individual'' 
     means an individual who is selected to participate by a 
     qualified entity under section 409.
       (3) Emergency withdrawal.--The term ``emergency 
     withdrawal'' means a withdrawal by an eligible individual 
     that--
       (A) is a withdrawal of only those funds, or a portion of 
     those funds, deposited by the individual in the individual 
     development account of the individual;
       (B) is permitted by a qualified entity on a case-by-case 
     basis; and
       (C) is made for--
       (i) expenses for medical care or necessary to obtain 
     medical care, for the individual or a spouse or dependent of 
     the individual described in paragraph (8)(D);
       (ii) payments necessary to prevent the eviction of the 
     individual from the residence of the individual, or 
     foreclosure on the mortgage for the principal residence of 
     the individual, as defined in paragraph (8)(B); or
       (iii) payments necessary to enable the individual to meet 
     necessary living expenses following loss of employment.
       (4) Household.--The term ``household'' means all 
     individuals who share use of a dwelling unit as primary 
     quarters for living and eating separate from other 
     individuals.
       (5) Individual development account.--
       (A) In general.--The term ``individual development 
     account'' means a trust created or organized in the United 
     States exclusively for the purpose of paying the qualified 
     expenses of an eligible individual, or enabling the eligible 
     individual to make an emergency withdrawal, but only if the 
     written governing instrument creating the trust meets the 
     following requirements:
       (i) No contribution will be accepted unless it is in cash 
     or by check.
       (ii) The trustee is a federally insured financial 
     institution, or a State insured financial institution if no 
     federally insured financial institution is available.
       (iii) The assets of the trust will be invested in 
     accordance with the direction of the eligible individual 
     after consultation with the qualified entity providing 
     deposits for the individual under section 410.
       (iv) The assets of the trust will not be commingled with 
     other property except in a common trust fund or common 
     investment fund.
       (v) Except as provided in clause (vi), any amount in the 
     trust which is attributable to a deposit provided under 
     section 410 may be paid or distributed out of the trust only 
     for the purpose of paying the qualified expenses of the 
     eligible individual, or enabling the eligible individual to 
     make an emergency withdrawal.
       (vi) Any balance in the trust on the day after the date on 
     which the individual for whose benefit the trust is 
     established dies shall be distributed within 30 days of that 
     date as directed by that individual to another individual 
     development account established for the benefit of an 
     eligible individual.
       (B) Custodial accounts.--For purposes of subparagraph (A), 
     a custodial account shall be treated as a trust if the assets 
     of the custodial account are held by a bank (as defined in 
     section 408(n) of the Internal Revenue Code of 1986) or 
     another person who demonstrates, to the satisfaction of the 
     Secretary, that the manner in which such person will 
     administer the custodial account will be consistent with the 
     requirements of this title, and if the custodial account 
     would, except for the fact that it is not a trust, constitute 
     an individual development account described in subparagraph 
     (A). For purposes of this title, in the case of a custodial 
     account treated as a trust by reason of the preceding 
     sentence, the custodian of that custodial account shall be 
     treated as the trustee thereof.
       (6) Project year.--The term ``project year'' means, with 
     respect to a demonstration project, any of the 4 consecutive 
     12-month periods beginning on the date the project is 
     originally authorized to be conducted.
       (7) Qualified entity.--
       (A) In general.--The term ``qualified entity'' means--
       (i) one or more not-for-profit organizations described in 
     section 501(c)(3) of the Internal Revenue Code of 1986 and 
     exempt from taxation under section 501(a) of such Code; or
       (ii) a State or local government agency, or a tribal 
     government, submitting an application under section 405 
     jointly with an organization described in clause (i).
       (B) Rule of construction.--Nothing in this paragraph shall 
     be construed as preventing an organization described in 
     subparagraph (A)(i) from collaborating with a financial 
     institution or for-profit community development corporation 
     to carry out the purposes of this title.
       (8) Qualified expenses.--The term ``qualified expenses'' 
     means one or more of the following, as provided by the 
     qualified entity:
       (A) Postsecondary educational expenses.--Postsecondary 
     educational expenses paid from an individual development 
     account directly to an eligible educational institution. In 
     this subparagraph:
       (i) Postsecondary educational expenses.--The term 
     ``postsecondary educational expenses'' means the following:

       (I) Tuition and fees.--Tuition and fees required for the 
     enrollment or attendance of a student at an eligible 
     educational institution.

       (II) Fees, books, supplies, and equipment.--Fees, books, 
     supplies, and equipment required for courses of instruction 
     at an eligible educational institution.

       (ii) Eligible educational institution.--The term ``eligible 
     educational institution'' means the following:

       (I) Institution of higher education.--An institution 
     described in section 481(a)(1) or 1201(a) of the Higher 
     Education Act of 1965 (20 U.S.C. 1088(a)(1) or 1141(a)), as 
     such sections are in effect on the date of enactment of this 
     title.
       (II) Postsecondary vocational education school.--An area 
     vocational education school (as defined in subparagraph (C) 
     or (D) of section 521(4) of the Carl D. Perkins Vocational 
     and Applied Technology Education Act (20 U.S.C. 2471(4))) 
     which is in any State (as defined in section 521(33) of such 
     Act), as such sections are in effect on the date of enactment 
     of this title.

       (B) First-home purchase.--Qualified acquisition costs with 
     respect to a principal residence for a qualified first-time 
     homebuyer, if paid from an individual development account 
     directly to the persons to whom the amounts are due. In this 
     subparagraph:
       (i) Principal residence.--The term ``principal residence'' 
     means a principal residence, the qualified acquisition costs 
     of which do not exceed 100 percent of the average area 
     purchase price applicable to such residence.
       (ii) Qualified acquisition costs.--The term ``qualified 
     acquisition costs'' means the costs of acquiring, 
     constructing, or reconstructing a residence. The term 
     includes any usual or reasonable settlement, financing, or 
     other closing costs.
       (iii) Qualified first-time homebuyer.--

       (I) In general.--The term ``qualified first-time 
     homebuyer'' means an individual participating in the project 
     (and, if married, the individual's spouse) who has no present 
     ownership interest in a principal residence during the 3-year 
     period ending on the date of acquisition of the principal 
     residence to which this subparagraph applies.
       (II) Date of acquisition.--The term ``date of acquisition'' 
     means the date on which a binding contract to acquire, 
     construct, or reconstruct the principal residence to which 
     this subparagraph applies is entered into.

       (C) Business capitalization.--Amounts paid from an 
     individual development account directly to a business 
     capitalization account which is established in a federally 
     insured financial institution and is restricted to use solely 
     for qualified business capitalization expenses. In this 
     subparagraph:
       (i) Qualified business capitalization expenses.--The term 
     ``qualified business capitalization expenses'' means 
     qualified expenditures for the capitalization of a qualified 
     business pursuant to a qualified plan.
       (ii) Qualified expenditures.--The term ``qualified 
     expenditures'' means expenditures included in a qualified 
     plan, including capital, plant, equipment, working capital, 
     and inventory expenses.
       (iii) Qualified business.--The term ``qualified business'' 
     means any business that does not contravene any law or public 
     policy (as determined by the Secretary).

[[Page S9080]]

       (iv) Qualified plan.--The term ``qualified plan'' means a 
     business plan, or a plan to use a business asset purchased, 
     which--

       (I) is approved by a financial institution, a 
     microenterprise development organization, or a nonprofit loan 
     fund having demonstrated fiduciary integrity;
       (II) includes a description of services or goods to be 
     sold, a marketing plan, and projected financial statements; 
     and
       (III) may require the eligible individual to obtain the 
     assistance of an experienced entrepreneurial adviser.

       (D) Transfers to idas of family members.--Amounts paid from 
     an individual development account directly into another such 
     account established for the benefit of an eligible individual 
     who is--
       (i) the individual's spouse; or
       (ii) any dependent of the individual with respect to whom 
     the individual is allowed a deduction under section 151 of 
     the Internal Revenue Code of 1986.
       (9) Qualified savings of the individual for the period.--
     The term ``qualified savings of the individual for the 
     period'' means the aggregate of the amounts contributed by 
     the individual to the individual development account of the 
     individual during the period.
       (10) Secretary.--The term ``Secretary'' means the Secretary 
     of Health and Human Services.
       (11) Tribal government.--The term ``tribal government'' 
     means a tribal organization, as defined in section 4 of the 
     Indian Self-Determination and Education Assistance Act (25 
     U.S.C. 450b) or a Native Hawaiian organization, as defined in 
     section 9212 of the Native Hawaiian Education Act (20 U.S.C. 
     7912).

     SEC. 405. APPLICATIONS.

       (a) Announcement of Demonstration Projects.--Not later than 
     3 months after the date of enactment of this title, the 
     Secretary shall publicly announce the availability of funding 
     under this title for demonstration projects and shall ensure 
     that applications to conduct the demonstration projects are 
     widely available to qualified entities.
       (b) Submission.--Not later than 6 months after the date of 
     enactment of this title, a qualified entity may submit to the 
     Secretary an application to conduct a demonstration project 
     under this title.
       (c) Criteria.--In considering whether to approve an 
     application to conduct a demonstration project under this 
     title, the Secretary shall assess the following:
       (1) Sufficiency of project.--The degree to which the 
     project described in the application appears likely to aid 
     project participants in achieving economic self-sufficiency 
     through activities requiring qualified expenses. In making 
     such assessment, the Secretary shall consider the overall 
     quality of project activities in making any particular kind 
     or combination of qualified expenses to be an essential 
     feature of any project.
       (2) Administrative ability.--The experience and ability of 
     the applicant to responsibly administer the project.
       (3) Ability to assist participants.--The experience and 
     ability of the applicant in recruiting, educating, and 
     assisting project participants to increase their economic 
     independence and general well-being through the development 
     of assets.
       (4) Commitment of non-federal funds.--The aggregate amount 
     of direct funds from non-Federal public sector and from 
     private sources that are formally committed to the project as 
     matching contributions.
       (5) Adequacy of plan for providing information for 
     evaluation.--The adequacy of the plan for providing 
     information relevant to an evaluation of the project.
       (6) Other factors.--Such other factors relevant to the 
     purposes of this title as the Secretary may specify.
       (d) Preferences.--In considering an application to conduct 
     a demonstration project under this title, the Secretary shall 
     give preference to an application that--
       (1) demonstrates the willingness and ability to select 
     individuals described in section 408 who are predominantly 
     from households in which a child (or children) is living with 
     the child's biological or adoptive mother or father, or with 
     the child's legal guardian;
       (2) provides a commitment of non-Federal funds with a 
     proportionately greater amount of such funds committed by 
     private sector sources; and
       (3) targets such individuals residing within one or more 
     relatively well-defined neighborhoods or communities 
     (including rural communities) that experience high rates of 
     poverty or unemployment.
       (e) Approval.--Not later than 9 months after the date of 
     enactment of this title, the Secretary shall, on a 
     competitive basis, approve such applications to conduct 
     demonstration projects under this title as the Secretary 
     deems appropriate, taking into account the assessments 
     required by subsections (c) and (d). The Secretary is 
     encouraged to ensure that the applications that are approved 
     involve a range of communities (both rural and urban) and 
     diverse populations.
       (f) Contracts With Nonprofit Entities.--The Secretary may 
     contract with an entity described in section 501(c)(3) of the 
     Internal Revenue Code of 1986 and exempt from taxation under 
     section 501(a) of such Code to carry out any responsibility 
     of the Secretary under this section or section 412 if--
       (1) such entity demonstrates the ability to carry out such 
     responsibility; and
       (2) the Secretary can demonstrate that such responsibility 
     would not be carried out by the Secretary at a lower cost.

     SEC. 406. DEMONSTRATION AUTHORITY; ANNUAL GRANTS.

       (a) Demonstration Authority.--If the Secretary approves an 
     application to conduct a demonstration project under this 
     title, the Secretary shall, not later than 10 months after 
     the date of enactment of this title, authorize the applicant 
     to conduct the project for 4 project years in accordance with 
     the approved application and the requirements of this title.
       (b) Grant Authority.--For each project year of a 
     demonstration project conducted under this title, the 
     Secretary may make a grant to the qualified entity authorized 
     to conduct the project. In making such a grant, the Secretary 
     shall make the grant on the first day of the project year in 
     an amount not to exceed the lesser of--
       (1) the aggregate amount of funds committed as matching 
     contributions by non-Federal public or private sector 
     sources; or
       (2) $1,000,000.

     SEC. 407. RESERVE FUND.

       (a) Establishment.--A qualified entity under this title, 
     other than a State or local government agency, or a tribal 
     government, shall establish a Reserve Fund which shall be 
     maintained in accordance with this section.
       (b) Amounts in Reserve Fund.--
       (1) In general.--As soon after receipt as is practicable, a 
     qualified entity shall deposit in the Reserve Fund 
     established under subsection (a)--
       (A) all funds provided to the qualified entity by any 
     public or private source in connection with the demonstration 
     project; and
       (B) the proceeds from any investment made under subsection 
     (c)(2).
       (2) Uniform accounting regulations.--The Secretary shall 
     prescribe regulations with respect to accounting for amounts 
     in the Reserve Fund established under subsection (a).
       (c) Use of Amounts in the Reserve Fund.--
       (1) In general.--A qualified entity shall use the amounts 
     in the Reserve Fund established under subsection (a) to--
       (A) assist participants in the demonstration project in 
     obtaining the skills (including economic literacy, budgeting, 
     credit, and counseling) and information necessary to achieve 
     economic self-sufficiency through activities requiring 
     qualified expenses;
       (B) provide deposits in accordance with section 410 for 
     individuals selected by the qualified entity to participate 
     in the demonstration project;
       (C) administer the demonstration project; and
       (D) provide the research organization evaluating the 
     demonstration project under section 414 with such information 
     with respect to the demonstration project as may be required 
     for the evaluation.
       (2) Authority to invest funds.--
       (A) Guidelines.--The Secretary shall establish guidelines 
     for investing amounts in the Reserve Fund established under 
     subsection (a) in a manner that provides an appropriate 
     balance between return, liquidity, and risk.
       (B) Investment.--A qualified entity shall invest the 
     amounts in its Reserve Fund that are not immediately needed 
     to carry out the provisions of paragraph (1), in accordance 
     with the guidelines established under subparagraph (A).
       (3) Limitation on uses.--Not more than 9.5 percent of the 
     amounts provided to a qualified entity under section 406(b) 
     shall be used by the qualified entity for the purposes 
     described in subparagraphs (A), (C), and (D) of paragraph 
     (1), of which not less than 2 percent of the amounts shall be 
     used by the qualified entity for the purposes described in 
     paragraph (1)(D). If two or more qualified entities are 
     jointly administering a project, no qualified entity shall 
     use more than its proportional share for the purposes 
     described in subparagraphs (A), (C), and (D) of paragraph 
     (1).
       (d) Unused Federal Grant Funds Transferred to the Secretary 
     When Project Terminates.--Notwithstanding subsection (c), 
     upon the termination of any demonstration project authorized 
     under this section, the qualified entity conducting the 
     project shall transfer to the Secretary an amount equal to--
       (1) the amounts in its Reserve Fund at time of the 
     termination; multiplied by
       (2) a percentage equal to--
       (A) the aggregate amount of grants made to the qualified 
     entity under section 406(b); divided by
       (B) the aggregate amount of all funds provided to the 
     qualified entity by all sources to conduct the project.

     SEC. 408. ELIGIBILITY FOR PARTICIPATION.

       (a) In General.--Any individual who is a member of a 
     household that is eligible for assistance under the State 
     temporary assistance for needy families program established 
     under part A of title IV of the Social Security Act (42 
     U.S.C. 601 et seq.), or that meets each of the following 
     requirements shall be eligible to participate in a 
     demonstration project conducted under this title:
       (1) Income test.--The adjusted gross income of the 
     household does not exceed the earned income amount described 
     in section 32 of the Internal Revenue Code of 1986 (taking 
     into account the size of the household).
       (2) Net worth test.--
       (A) In general.--The net worth of the household, as of the 
     end of the calendar year preceding the determination of 
     eligibility, does not exceed $10,000.
       (B) Determination of net worth.--For purposes of 
     subparagraph (A), the net worth of a household is the amount 
     equal to--
       (i) the aggregate market value of all assets that are owned 
     in whole or in part by any member of the household; minus
       (ii) the obligations or debts of any member of the 
     household.
       (C) Exclusions.--For purposes of determining the net worth 
     of a household, a household's assets shall not be considered 
     to include the primary dwelling unit and one motor vehicle 
     owned by the household.

[[Page S9081]]

       (b) Individuals Unable To Complete the Project.--The 
     Secretary shall establish such regulations as are necessary, 
     including prohibiting future eligibility to participate in 
     any other demonstration project conducted under this title, 
     to ensure compliance with this title if an individual 
     participating in the demonstration project moves from the 
     community in which the project is conducted or is otherwise 
     unable to continue participating in that project.

     SEC. 409. SELECTION OF INDIVIDUALS TO PARTICIPATE.

       From among the individuals eligible to participate in a 
     demonstration project conducted under this title, each 
     qualified entity shall select the individuals--
       (1) that the qualified entity deems to be best suited to 
     participate; and
       (2) to whom the qualified entity will provide deposits in 
     accordance with section 410.

     SEC. 410. DEPOSITS BY QUALIFIED ENTITIES.

       (a) In General.--Not less than once every 3 months during 
     each project year, each qualified entity under this title 
     shall deposit in the individual development account of each 
     individual participating in the project, or into a parallel 
     account maintained by the qualified entity--
       (1) from the non-Federal funds described in section 
     405(c)(4), a matching contribution of not less than $0.50 and 
     not more than $4 for every $1 of earned income (as defined in 
     section 911(d)(2) of the Internal Revenue Code of 1986) 
     deposited in the account by a project participant during that 
     period;
       (2) from the grant made under section 406(b), an amount 
     equal to the matching contribution made under paragraph (1); 
     and
       (3) any interest that has accrued on amounts deposited 
     under paragraph (1) or (2) on behalf of that individual into 
     the individual development account of the individual or into 
     a parallel account maintained by the qualified entity.
       (b) Limitation on Deposits for an Individual.--Not more 
     than $2,000 from a grant made under section 406(b) shall be 
     provided to any one individual over the course of the 
     demonstration project.
       (c) Limitation on Deposits for a Household.--Not more than 
     $4,000 from a grant made under section 406(b) shall be 
     provided to any one household over the course of the 
     demonstration project.
       (d) Withdrawal of Funds.--The Secretary shall establish 
     such guidelines as may be necessary to ensure that funds held 
     in an individual development account are not withdrawn, 
     except for one or more qualified expenses, or for an 
     emergency withdrawal. Such guidelines shall include a 
     requirement that a responsible official of the qualified 
     entity conducting a project approve such withdrawal in 
     writing. The guidelines shall provide that no individual may 
     withdraw funds from an individual development account earlier 
     than 6 months after the date on which the individual first 
     deposits funds in the account.
       (e) Reimbursement.--An individual shall reimburse an 
     individual development account for any funds withdrawn from 
     the account for an emergency withdrawal, not later than 12 
     months after the date of the withdrawal. If the individual 
     fails to make the reimbursement, the qualified entity 
     administering the account shall transfer the funds deposited 
     into the account or a parallel account under section 410 to 
     the Reserve Fund of the qualified entity, and use the funds 
     to benefit other individuals participating in the 
     demonstration project involved.

     SEC. 411. LOCAL CONTROL OVER DEMONSTRATION PROJECTS.

       A qualified entity under this title, other than a State or 
     local government agency or a tribal government, shall, 
     subject to the provisions of section 413, have sole authority 
     over the administration of the project. The Secretary may 
     prescribe only such regulations or guidelines with respect to 
     demonstration projects conducted under this title as are 
     necessary to ensure compliance with the approved applications 
     and the requirements of this title.

     SEC. 412. ANNUAL PROGRESS REPORTS.

       (a) In General.--Each qualified entity under this title 
     shall prepare an annual report on the progress of the 
     demonstration project. Each report shall include both program 
     and participant information and shall specify for the period 
     covered by the report the following information:
       (1) The number of individuals making a deposit into an 
     individual development account.
       (2) The amounts in the Reserve Fund established with 
     respect to the project.
       (3) The amounts deposited in the individual development 
     accounts.
       (4) The amounts withdrawn from the individual development 
     accounts and the purposes for which such amounts were 
     withdrawn.
       (5) The balances remaining in the individual development 
     accounts.
       (6) The savings account characteristics (such as threshold 
     amounts and match rates) required to stimulate participation 
     in the demonstration project, and how such characteristics 
     vary among different populations or communities.
       (7) What service configurations of the qualified entity 
     (such as peer support, structured planning exercises, 
     mentoring, and case management) increased the rate and 
     consistency of participation in the demonstration project and 
     how such configurations varied among different populations or 
     communities.
       (8) Such other information as the Secretary may require to 
     evaluate the demonstration project.
       (b) Submission of Reports.--The qualified entity shall 
     submit each report required to be prepared under subsection 
     (a) to--
       (1) the Secretary; and
       (2) the Treasurer (or equivalent official) of the State in 
     which the project is conducted, if the State or a local 
     government or a tribal government committed funds to the 
     demonstration project.
       (c) Timing.--The first report required by subsection (a) 
     shall be submitted not later than 60 days after the end of 
     the calendar year in which the Secretary authorized the 
     qualified entity to conduct the demonstration project, and 
     subsequent reports shall be submitted every 12 months 
     thereafter, until the conclusion of the project.

     SEC. 413. SANCTIONS.

       (a) Authority To Terminate Demonstration Project.--If the 
     Secretary determines that a qualified entity under this title 
     is not operating the demonstration project in accordance with 
     the entity's application or the requirements of this title 
     (and has not implemented any corrective recommendations 
     directed by the Secretary), the Secretary shall terminate 
     such entity's authority to conduct the demonstration project.
       (b) Actions Required Upon Termination.--If the Secretary 
     terminates the authority to conduct a demonstration project, 
     the Secretary--
       (1) shall suspend the demonstration project;
       (2) shall take control of the Reserve Fund established 
     pursuant to section 407;
       (3) shall make every effort to identify another qualified 
     entity (or entities) willing and able to conduct the project 
     in accordance with the approved application (or, as modified, 
     if necessary to incorporate the recommendations) and the 
     requirements of this title;
       (4) shall, if the Secretary identifies an entity (or 
     entities) described in paragraph (3)--
       (A) authorize the entity (or entities) to conduct the 
     project in accordance with the approved application (or, as 
     modified, if necessary, to incorporate the recommendations) 
     and the requirements of this title;
       (B) transfer to the entity (or entities) control over the 
     Reserve Fund established pursuant to section 407; and
       (C) consider, for purposes of this title--
       (i) such other entity (or entities) to be the qualified 
     entity (or entities) originally authorized to conduct the 
     demonstration project; and
       (ii) the date of such authorization to be the date of the 
     original authorization; and
       (5) if, by the end of the 1-year period beginning on the 
     date of the termination, the Secretary has not found a 
     qualified entity (or entities) described in paragraph (3), 
     shall--
       (A) terminate the project; and
       (B) from the amount remaining in the Reserve Fund 
     established as part of the project, remit to each source that 
     provided funds under section 405(c)(4) to the entity 
     originally authorized to conduct the project, an amount that 
     bears the same ratio to the amount so remaining as the amount 
     provided by the source under section 405(c)(4) bears to the 
     amount provided by all such sources under that section.

     SEC. 414. EVALUATIONS.

       (a) In General.--Not later than 10 months after the date of 
     enactment of this title, the Secretary shall enter into a 
     contract with an independent research organization to 
     evaluate, individually and as a group, all qualified entities 
     and sources participating in the demonstration projects 
     conducted under this title.
       (b) Factors To Evaluate.--In evaluating any demonstration 
     project conducted under this title, the research organization 
     shall address the following factors:
       (1) The effects of incentives and organizational or 
     institutional support on savings behavior in the 
     demonstration project.
       (2) The savings rates of individuals in the demonstration 
     project based on demographic characteristics including 
     gender, age, family size, race or ethnic background, and 
     income.
       (3) The economic, civic, psychological, and social effects 
     of asset accumulation, and how such effects vary among 
     different populations or communities.
       (4) The effects of individual development accounts on 
     savings rates, homeownership, level of postsecondary 
     education attained, and self-employment, and how such effects 
     vary among different populations or communities.
       (5) The potential financial returns to the Federal 
     Government and to other public sector and private sector 
     investors in individual development accounts over a 5-year 
     and 10-year period of time.
       (6) The lessons to be learned from the demonstration 
     projects conducted under this title and if a permanent 
     program of individual development accounts should be 
     established.
       (7) Such other factors as may be prescribed by the 
     Secretary.
       (c) Methodological Requirements.--In evaluating any 
     demonstration project conducted under this title, the 
     research organization shall--
       (1) for at least one site, use control groups to compare 
     participants with nonparticipants;
       (2) before, during, and after the project, obtain such 
     quantitative data as are necessary to evaluate the project 
     thoroughly; and
       (3) develop a qualitative assessment, derived from sources 
     such as in-depth interviews, of how asset accumulation 
     affects individuals and families.
       (d) Reports by the Secretary.--
       (1) Interim reports.--Not later than 90 days after the end 
     of the calendar year in which the Secretary first authorizes 
     a qualified entity to conduct a demonstration project under 
     this title, and every 12 months thereafter until all 
     demonstration projects conducted under this title are 
     completed, the Secretary shall submit to Congress an interim 
     report setting forth the results of the reports submitted 
     pursuant to section 412(b).
       (2) Final reports.--Not later than 12 months after the 
     conclusion of all demonstration projects conducted under this 
     title, the Secretary shall submit to Congress a final report 
     setting forth the results and findings of all reports and 
     evaluations conducted pursuant to this title.
       (e) Evaluation Expenses.--The Secretary shall expend such 
     sums as may be necessary,

[[Page S9082]]

     but not more than 2 percent of the amounts appropriated under 
     section 416 for a fiscal year, to carry out the purposes of 
     this section.

     SEC. 415. TREATMENT OF FUNDS.

       Of the funds deposited in individual development accounts 
     for eligible individuals only the funds deposited by the 
     individuals (including interest accruing on those funds) may 
     be considered to be the income, assets, or resources of the 
     individuals, for purposes of determining eligibility for, or 
     the amount of assistance furnished under, any Federal or 
     federally assisted program based on need.

     SEC. 416. AUTHORIZATION OF APPROPRIATIONS.

       There is authorized to be appropriated to carry out this 
     title, $25,000,000 for each of fiscal years 1999, 2000, 2001, 
     2002, and 2003 to remain available until expended.

  Mr. COATS. Mr. President, I am pleased to bring before the Senate, on 
behalf of the Committee on Labor and Human Resources, S. 2206, the 
Coats Human Services Reauthorization Act of 1998.
  This legislation is truly the result of a significant bi-partisan 
effort. We have worked closely with members of the committee to make 
important changes in program focus and in our expectations for 
measurable outcomes.
  Few federal programs engender the kind of positive feelings as do the 
programs we are discussing today: Head Start, the Community Services 
Block Grant, the Low Income Home Energy Assistance program, and a new 
program--close to my heart, the Assets for Independence Act.
  These programs all have one important thing in common--they represent 
the federal government at its best, forging public and private 
partnerships to combat the effects of poverty, and unleashing the vast 
resources of one of our most important assets--the local community.
  Whether in a Head Start classroom, a food bank, or a community action 
agency, the programs we are about to reauthorize provide a valuable 
link between families and the services and opportunities they need.
  I have had the privilege of visiting a number of Head Start programs 
in my own state, and have found at each one a common thread--the 
commitment of staff and of parents to be there for their children. In 
Head Start centers across America, parents serve as volunteers, as 
teachers, as aides, in whatever capacity they are needed. Many have 
told me that thanks to Head Start, they have gone on to higher 
education. Thanks to Head Start, their children have hope for a future. 
I say that it is thanks to their commitment as parents that their 
children's hopes have been realized.
  S. 2206 continues this legacy--and does so in a way that supports the 
family as a unit. Head Start is a program serving children in families. 
CSBG is a program serving families in communities. And Assets for 
Independence makes it possible for families to become fully self 
sufficient.
  Before I briefly discuss the specifics issues addressed in the 
legislation I want to thank members of the Committee (Senator Dodd, 
Kennedy, Jeffords, DeWine and McConnell in particular) and of course 
their staffs for their commitment to this process being open and bi-
partisan. I think the fruit of all of our efforts is in the bill we 
will vote on today. I also would also like Karen Spar from the 
Congressional Research Service who has been tireless in her efforts to 
provide support to my staff and Liz Aldridge-King from the Office of 
Legislative Counsel who worked virtually around the clock to get this 
bill out on time. Thank you to all who contributed to this effort.
  Head Start is a program that has been identified as one with enormous 
potential in giving children an opportunity to realize their full 
potential; however, it has been a program which has experienced varying 
degrees of quality. With the 1994 reauthization, Congress and the 
Administration formed an important partnership to devise ways to make 
program quality a primary focus. Since the last reauthorization, the 
Head Start Bureau has offered technical assistance, resources, and 
support to Head Start programs that are committed to pursuing 
excellence--and terminated the grants of those programs that were 
experiencing significant program deficiencies. Close to 100 Head Start 
grantees have been terminated or have relinquished their grants since 
1994.
  S. 2206 takes further steps to ensure quality and to make sure that 
Head Start students attain the goal of school readiness by expanding 
the use of quality improvement funds to provide staff training related 
to the promotion of language skills and literacy growth of children and 
the acquisition of English for children from non-English-speaking 
backgrounds and by requiring the establishment of education performance 
standards to ensure school readiness and that children develop a 
minimum level of literacy awareness and understanding. Further, the 
Secretary is directed to develop outcome-based performance measures and 
to apply those measures to local grantees when evaluating program 
effectiveness. Under this scenario, consistent poor performers would be 
identified, offered technical assistance, and if they failed to correct 
the deficiency--terminated and their grant re-competed.
  We have responded to concerns that Head Start programs be able to 
more fully respond to emerging needs of working families for full-day, 
full-year services by significantly enhancing the collaboration grant 
program in current law by requiring active collaboration between Head 
Start, the State liaison appointed by the Governor, and other early 
care and education programs within the State. We have attempted to 
eliminate barriers to effective collaboration and have instructed the 
Secretary to design an administrative structure whereby additional 
barriers that are identified can be addressed. Taken together, these 
provisions should make it much easier for States to include Head Start 
in unified planning regarding early care and education services at the 
state and local level.
  To respond to the recent research on the importance of early brain 
development, we have included the President's request for an expansion 
of the Early Head Start program from 7.5 percent in FY 1999 to 10 
percent in FY 2003. We have required the Secretary to set aside a 
portion of these funds to provide technical assistance to ensure the 
maintenance of program quality and given the Secretary the authority to 
reduce the set aside amounts, if necessary to avoid a reduction in 
regular Head Start services or quality.
  To respond to the issue of improved teacher competence, we have added 
a new section to the section in the law pertaining to staff 
qualifications to ensure that each head start classroom has a teacher 
with demonstrated competency to perform certain functions. This was 
done in lieu of mandating additional degrees such as 2 or 4 year 
college degree which is not the norm for preschools in America, and 
which in fact, are not a good measure for teacher competence. Rather, 
we focus on specific demonstrated competencies which must first be 
achieved in order to qualify as a teacher.
  During the last reauthorization in 1994 we required every Head Start 
classroom to have a teacher with at least Child Development Associate 
credential. With near accomplishment of that goal we wanted to make 
sure that waivers to this requirement would only be given in the most 
limited circumstance. Therefore we allow a 180-day waiver which will 
only be available where a Head Start agency could document that it had 
unsuccessfully attempted to recruit an individual with the required 
credential, certificate or degree. Such a waiver would be for an 
individual who is enrolled in a program that grants the appropriate 
credential, and who will receive the appropriate credential within 180 
days of beginning employment as a Head Start teacher.
  In response to concerns raised by the General Accounting Office and 
others about the lack of reliable research on Head Start which can be 
used to determine its effectiveness, we have authorized a national 
impact study of Head Start and also included, at the request of Senator 
DeWine, several smaller comparative studies of children participating 
in head start with eligible children who did not participate in Head 
Start or other preschool programs. These studies should yield very 
valuable information about how this program is working, and whether 
Head Start is, as we all hope and believe it is, making a difference.
  Title II of S. 2206 authorizes the Community Services Block Grant. 
This program had not been updated since 1981 when CSBG came into 
existence as a block grant. Therefore, we have done a complete redraft 
of this program to bring it current and to make some very

[[Page S9083]]

important changes to program structure and goals.
  First, we have established some very specific program goals which 
include strengthening community capabilities for planning, coordinating 
and supporting innovative responses to community needs and conditions. 
CSBG is an excellent example of what can happen when Washington gets 
out of the way and allows local communities to design effective 
responses to local problems. Ninety percent of the funds provided under 
this act must be passed through by the State to local eligible entities 
which include a variety of public and non-profit organizations, 
community action agencies, and faith-based neighborhood organizations.

  Second, we have established a mechanism for state monitoring of 
eligible entities to determine whether such entities meet performance 
goals, administrative standards, financial management requirements, and 
other requirements of the state. Each State will be required to 
participate in a performance measurement system, although they will be 
able to choose from a menu of priorities to reflect the current program 
they are instituting at the local level.
  Third, we have grand fathered in all existing public CAPS but are 
requiring that any new public CAPS may come into existence only if 
there is no private, nonprofit organization identified or qualified to 
serve as the CSBG recipient. Like private nonprofit agencies, public 
CAPS would have to agree to administer their program through a local 
tripartite board and ensure adequate low income representation on it.
  Fourth, with respect to the discretionary programs under CSBG, we 
have reauthorized the Community Economic Development program, the Rural 
Community Development program, National Youth Sports, and Community 
Food and Nutrition. We have created a new program called Neighborhood 
Innovation Projects for grants to neighborhood based, private non-
profits to test or assist in the development of new approaches or 
methods of dealing with community problems. These grants may be used 
for a variety of purposes including gang interventions, addressing 
school violence, or any other purposes that are identified by the 
community as a problem resulting from poverty and consistent with the 
purposes of this CSBG.
  Title III are reauthorizes the Low Income Home Energy Assistance 
Program at the current level of $2 billion for each of the fiscal years 
1999 through 2004. The amount available for leveraging is reduced from 
$50,000,000 to $30,000,000 except in any year in which appropriations 
fall below $1.4 billion at which time the leveraging pot goes back to 
$50,000,000.
  The most significant change in this program is the addition of a new 
section which clarifies the criteria by which LIHEAP funds can be 
released in an emergency or natural disaster. Currently, there is an 
arbitrary standard for determining an emergency or natural disaster, 
this language will rectify this problem by listing standards under 
which funds may be released which may include: significant home energy 
supply shortage or disruption; a significant increase in the cost of 
home energy, as determined by the secretary; a significant increase in 
home energy disconnections reported by a utility, a state regulatory 
agency, or another agency with necessary data; significant increase in 
participation in a public benefit program such as the food stamp 
program; a significant increase in unemployment or layoffs; or any 
other event meeting criteria as the secretary may determine to be 
appropriate.
  This is an important addition, and I would like to thank Senators 
Jeffords and Kennedy for their leadership in this matter.
  Finally, Title IV establishes a five year demonstration program to 
determine the social, civic, psychological and economic effects that 
Individual Development Account (IDA) savings accounts can have on low 
income individuals and their families.
  In some respects, IDAs are like IRAs for the working poor. They are 
dedicated savings accounts that can be used for purchasing a first 
home, post-secondary education, or capitalizing a business. These 
investments are associated with extremely high rates of return that 
have the potential to bring a new level of economic and personal 
security to families and communities.
  The individual or family deposits whatever they can save (typically 
$5-$20 a month) in the account. The sponsoring organization ``matches'' 
that deposit with funds provided by local churches and service 
organizations, corporations, foundations, and state or local 
governments.
  The intent of this demonstration program is to encourage participants 
to develop and reaffirm strong habits for saving money. To assist this, 
sponsor organizations will provide participating individuals and 
families intensive financial counseling and counseling to develop 
investment plans for education, home ownership, and entrepreneurship.
  In addition, participating welfare and low-income families build 
assets whose high return on investment propels them into independence 
and stability. The community will also benefit from the significant 
return on an investment in IDAs: we can expect welfare rolls to be 
reduced; tax receipts to increase; employment to increase; and local 
enterprises and builders can expect increased business activity. 
Neighborhoods will be rejuvenated as new microenterprises and increased 
home renovation and building drive increased employment and community 
development.
  In fact, it is estimated that an investment of $100 million in asset 
building through these individual accounts would generate :7,050 new 
businesses; 68,799 new jobs; $730 million in additional earnings; 
12,000 new or rehabilitated homes; $287 million in savings and matching 
contributions and earnings on those accounts; 188 million in increased 
assets for low-income families 6,600 families removed from welfare 
rolls 12,000 youth graduates from vocational education and college 
programs; 20,000 adults obtaining high school, vocational, and college 
degrees.
  IDAs are planned or now available on a small scale across the 
country, including Indiana, Illinois, Virginia, Oregon, and Iowa. The 
Assets for Independence Act has been developed after a review of 
numerous, similar, successful programs, and most notably one run by the 
Eastside Community Investments community development corporation in 
Indianapolis, Indiana. This provision incorporates a number of 
protections developed with their assistance and based on their 
experience.
  Mr. President, taken together, I think we have an excellent package 
of programs designed to reauthorize programs which have been vital to 
many low-income individuals and communities. These programs are for the 
most part locally designed and controlled and offer unique 
opportunities for self-sufficiency and enhanced community involvement.
  Mr. JEFFORDS. Mr. President, I am pleased the Senate has turned to 
consideration of the Community Opportunities, Accountability, Education 
and Training Services Act of 1998--the COATS Act--which reauthorizes 
the Human Services Act. This legislation, sponsored by Senator Coats, 
Senator Dodd, myself, and Senator Kennedy, was voted unanimously out of 
the Senate Labor and Human Resources Committee on June 24, 1998, and 
continues to have broad bipartisan support.
  This bill includes the reauthorization of three of our most important 
programs providing services and assistance to the neediest of 
Americans: the Head Start program, the Community Services Block Grant, 
and the Low Income Home Energy Assistance Program. It also includes a 
new program, the Assets for Independence Act, to empower these citizens 
into achieving economic independence.
  This legislation draws upon over thirty years of experience with 
these programs. While each of these programs is working--and working 
well--there are clearly some things that we can be doing better. So 
while this bill leaves present law largely intact, it does include some 
important changes to make these programs more accountable and more 
effective in carrying out the specific tasks that we have asked of 
them.
  The Head Start Program has been instrumental in helping many children 
enter school ready to learn. It goes beyond child care, by providing 
medical, dental, and other services to children enrolled in the 
program. However, I believe that its major contribution has been to 
support parents in their role as

[[Page S9084]]

the primary teacher for their children. Head Start is a comprehensive 
service program that has made a difference in the lives of so many 
children and their parents.
  While most of us know the difference that Head Start has made in the 
lives of millions of children and their parents, it is important that 
we continue to ensure that the program is the very best it can be. This 
reauthorization includes a major evaluation and research initiative. I 
believe this research will help demonstrate the positive impact of high 
quality, comprehensive services for children and families. More 
importantly, this initiative can provide the American people with more 
information about how best to help prepare all of our children for the 
challenges that lie ahead in the next century.
  We also have increased funding for the Infant and Toddler Head Start 
program. Although this program is relatively new, the emerging research 
on early brain development clearly indicates that tremendous benefits 
can be gained by supporting parents in their efforts to be good parents 
for their children. Few young parents have the family and community 
support networks that were once such an integral part of raising 
children. The Infant and Toddler program strives to re-create those 
networks in order to help mothers and fathers better meet the 
challenges of parenthood.
  One of the more controversial changes in this year's reauthorization 
is the inclusion of for-profit providers as eligible grantees for Head 
Start. Yet, working with Senators Kennedy and Dodd, we were able to 
reach an acceptable compromise that makes clear exactly what is and is 
not allowed. Briefly, the legislation opens up the competitive process 
to another segment of child care and human service provider . However, 
it does not require the Secretary to award a grant to a non-profit 
entity. It does not lessen the requirements and standards that any Head 
Start program must meet. I do not believe that, by virtue of an 
organization's tax status, it is either more or less capable of 
providing the high quality of services which we require of all Head 
Start grantees. I am pleased that an agreement on this issue has been 
reached.
  The second major program authorized under this legislation is the 
Community Services Block Grant. This program provides funding which 
enables States to work with their communities to reduce poverty. That's 
an easily defined goal, but getting there takes lots of work. Because 
it is locally-driven and community-based, the CSBG is used differently 
in every community--drawing upon available strengths and resources to 
meet the unique needs of each.
  In Vermont, the CSBG serves communities all across our state, from 
Brattleboro to the Northeast Kingdom. Under the current formula, 
Vermont receives a little more than $2.6 million in CSBG funds. Whether 
it's using CSBG dollars to help the underprivileged learn new job 
skills or go back to school, or helping families become self-sufficient 
by teaching them how to search for affordable housing or simply work 
within a budget, I think countless families and communities in our 
State would agree that the initial investment has earned priceless 
returns. Communities are using those dollars to make a difference.
  For this reason, I am pleased that we have made only minor 
adjustments in these programs, and that most of these changes make some 
necessary improvements that will allow us to better determine the 
effectiveness of CSBG programs. For example, this bill requires states 
to monitor their grantees to determine whether they are meeting 
performance goals, administrative standards, and financial management 
requirements. The bill also establishes state and federal 
accountability and reporting provisions, and requires grantees to 
participate in a performance measurement system. Presently, grantees 
may participate in this system, but are not required to do so. The 
changes in this bill mean that we will be able to better monitor the 
progress of programs and measure the effectiveness of the delivery of 
programs.
  I want to point out, however, that I am aware that through a 
technical change that we were unable to remove at the last minute, this 
legislation contains language repealing the Community Economic 
Development program. This was brought to my attention, and to the 
attention of the Ranking Member, last Friday, and we have taken steps 
to remedy the situation. Our House colleagues have indicated their bill 
will not repeal this provision, and Senator Coats and I have pledged 
that we will remove the language repealing this program in conference. 
This is a matter that was due to a technical oversight only; it is 
certainly not the intention of the committee to end this program, and I 
am grateful for the assistance of Congressman Bill Goodling and his 
staff in helping us resolve this matter satisfactorily.
  I also want to mention that I know there was some concern about 
allowing faith-based organizations to participate as direct grantees in 
CSBG programs. I want to be clear that this bill does not allow faith-
based organizations any priority in becoming grantees. It simply says 
that they may participate. If a faith-based organization receives a 
grant, it will still be expected to run quality programs and operate in 
the same way any other grantee would, including establishing a tri-
partite board to administer the programs. Further, there is language in 
this bill essentially grandfathering in existing community action 
agencies as eligible grantees, so there should not be a concern that 
current grantees will suddenly find themselves jockeying for funding. 
If they are delivering good services, they may continue to do so.
  There was also some concern over including a new program, the 
Neighborhood Innovation Project, as an allowable activity under the 
discretionary account because it would mean less funds for the other 
programs authorized in the account. Let me explain why this is not the 
case--and, in fact, if Congressional appropriators follow the 
authorization carefully, there should be more funding for programs 
within this account.
  Under current law, the discretionary account receives a set-aside of 
nine percent of the CSBG funds. Presently, the discretionary account 
only contains the community economic development programs and the rural 
community development programs as allowable expenditures. However, at 
appropriations time, the appropriators have been folding the National 
Youth Sports program (NYSP) and the Community Food and Nutrition Act 
(CFNP) into the nine percent set-aside. What the law actually says--and 
what this bill reinforces--is that the NYSP and the CFNP program are 
both worthwhile programs that should receive separately appropriated 
line-items; they should not be competing with the community economic 
development and rural community development initiatives to receive a 
part of that nine-percent set-aside. I hope the appropriators will 
follow the authorization and limit the programs funded through the 
nine-percent set-aside.
  Under the new bill, we maintain the NYSP and CFNP as separate 
accounts that do not compete with programs in the discretionary 
account. I know this all sounds like maudlin bookkeeping, but what it 
means is that, even with the new Neighborhood Innovation Project 
included in the discretionary account, there are now only three 
programs among which the discretionary account can be divided, not 
four. That should mean funding can go a little bit further for these 
programs. Meanwhile, the NYSP and CNFP can receive their own separate 
streams of funding. That is clearly our intent.
  While on the subject of the NYSP, let me just mention one change we 
made in the current program to ensure a more comprehensive delivery of 
services. What this legislation would do is link youth who participate 
in this five week summer program to community-based youth services that 
can serve their needs all year long.
  The third major program reauthorized in this legislation is the Low 
Income Home Energy Assistance Program (LIHEAP), which, due to the 
forward-funded nature of the program, is authorized through 2004. The 
program provides assistance to 4.3 million low-income households to 
help families pay their heating and cooling bills. LIHEAP is a state 
block grant program that has faced more than its fair share of budget 
cuts. In fact, I am very dismayed that appropriators on the House side 
have voted to slash funding for the program.

[[Page S9085]]

  Our bill reauthorizes the program at the $2 billion level and 
continues to authorize funds to be released on an emergency basis by 
the President. On that subject, we have included language that 
clarifies the criteria under which LIHEAP funds can be released during 
an emergency or natural disaster. Last winter, when much of Northern 
New England was devastated by a 100-year ice storm, 53 Senators 
unsuccessfully wrote to the President asking him to release LIHEAP 
emergency funds. Our bill includes language that will help states 
obtain funds when they face similar natural or economic disasters.
  Finally, this bill authorizes a new, $25 million program known as the 
Assets for Independence Act. This new program builds upon the 
Individual Development Accounts that we allowed under welfare reform. 
The Assets for Independence Act would help qualified, poor individuals 
establish individual savings accounts that they can later use for post-
secondary education, purchase of a first home, or business 
capitalization.
  In Vermont, we are already operating a program very much like this 
under our welfare waiver. However, Vermont's program does not look 
exactly like what is in this bill, and I want to make it clear that 
Vermont, and any other state, may continue to operate existing IDA 
programs as they deem fit, using their existing resources. States do 
not have to make their program look like those established in this bill 
unless they specifically apply for the funding made available under 
this section. What is in this bill does not override any existing IDA 
program. Knowing this, I am pleased we were able to include this new 
section in the bill, as I know it has been a priority for Senator 
Coats, and I commend him for working with me to ensure that Vermont can 
continue to run its existing programs.
  This legislation is the result of months of hard work, negotiation, 
and compromise. This is a very good bill that deserves the support of 
the Senate. It reinforces what works in these programs, and discards 
what does not. It continues the mission that we began many years ago of 
empowering communities to help their most vulnerable populations, and 
it does this in a responsible manner.
  I am pleased with the bipartisan atmosphere that has surrounded this 
bill so far, and I look forward to finishing the reauthorization in the 
same manner. I want to thank Senator Coats for his excellent work on 
this important legislation. As always, it is a pleasure working with 
him, and I want to commend him for his hard work in crafting this 
compromise. Senator Kennedy and Senator Dodd were instrumental in 
drafting this bill and moving it through the committee, and each has 
left a definite mark on this legislation. I also appreciate the 
valuable input from Senators DeWine and Ashcroft in drafting some key 
provisions of the bill.
  There are a number of staff who have worked very hard on this 
legislation who deserve recognition for their efforts. In particular, I 
want to thank Stephanie Monroe with Senator Coats--her effort was 
extraordinary; Suzanne Day, Jeanne Ireland and Jim Fenton with Senator 
Dodd; Stephanie Robinson with Senator Kennedy; and Geoff Brown, 
Kimberly Barnes-O'Connor and Brian Jones of my staff. In addition, I 
want to note the contributions of Vince Ventimiglia with Senator Coats 
on the IDA section; Aaron Grau with Senator DeWine for his help with 
migrant and seasonal Head Start; Robin Bowen with Senator McConnell for 
her assistance on the CED correction; and Denzel McGuire with Chairman 
Goodling for her help in assuring a smooth debate with the House.
  Again, Mr. President, I am proud of this legislation and of all the 
work that has gone into it. I look forward to working with our House 
colleagues to approve final legislation, with broad bipartisan support, 
before the 105th Congress adjourns for the year.
  I yield the floor.
  Mr. McCONNELL. Mr. President, I want to thank Senator Coats and 
Senator Jeffords for their exemplary work on the Coats Act's 
reauthorization of Head Start, Community Services Block Grants. Low-
Income Home Energy Assistance, and the new authorization for an 
Individual Development Account demonstration.
  In particular, I appreciate their commitment to address a matter of 
serious concern to me regarding provisions that would unintentionally 
impact the Rural Development Loan Fund currently administered by the 
U.S. Department of Agriculture.
  The Coats Act includes the repeal of section 407 of the Human 
Services Reauthorization Act of 1986 and the Community Economic 
Development Act. These statutory repeals were included to achieve a 
reasonable clarification of the statutory authority held by the U.S. 
Department of Health and Human Services. Upon further examination of 
these provisions after the committee mark-up, we discovered that this 
house-keeping action for HHS would eliminate provisions essential to 
the USDA's administration of the Rural Development Loan Fund, a lending 
program that has provided vital economic support to several communities 
in Kentucky.
  I understand that during conference, Senators Coats and Jeffords have 
agreed to recede to the House position and drop the Coats Act 
provisions that repeal section 407 and CEDA.
  Mr. COATS. That is correct. We were attempting to do a significant 
cleanup of a statute that has not been modified in any real way since 
1981. We were informed that these programs were obsolete and had not 
received funding from the Department of Health and Human Services for 
some time. We therefore, as part of a package of technical corrects 
identified to bring the statute into conformity, repealed these two 
programs. Senator McConnell was very helpful in bringing this error to 
our attention and we have given him our assurance that it will be 
corrected in Conference with the House.
  Mr. McCONNELL. I thank the Senator from Indiana for his commitment to 
resolve this issue, and greatly appreciate his understanding of the 
Rural Development Loan Fund's importance to Kentucky's efforts to spur 
economic growth in rural areas.
  Mr. DODD. Mr. President, I am very pleased that today we take up the 
reauthorization of the the Community Opportunities, Accountability, 
Training and Educational Services (COATS) Act, which includes Head 
Start, LIHEAP and the Community Service Block Grant. This bill is 
sponsored by Chairman Jeffords, Senator Kennedy, Senator Coats, and 
myself, and was reported unanimously by the Labor and Human Resources 
Committee a month ago. This strong record of bipartisan support is a 
clear statement of how we all view these crucial programs. But it is 
also a testament to the leadership of Senator Coats on this 
legislation. As a tribute, we on the Committee insisted on naming this 
important bill after him.
  This bill is fundamentally about improving the reach of opportunity 
in America to all of our citizens.
  Head Start will serve over 830,000 children and their families this 
year; nearly 6,000 in my home state of Connecticut. These families and 
their children will receive access to the nation's leading child 
development program. Head Start focuses on the needs of the whole 
child. Inherently, we know that a child cannot be successful if he or 
she has unidentified health needs, if his or her parents are not 
involved in their education, and if he or she is not well-nourished or 
well-rested. Head Start is the embodiment of those concerns and works 
each day to meet children's critical needs.
  The bill before us today further strengthens the Head Start program: 
We continue the expansion of the Early Head Start program, increasing 
the set aside for this program to 10 percent in FY 2002. Anyone who has 
picked up a magazine or newspaper within the last year knows how vital 
the first three years of a child's life are to their development. This 
program, which we established in 1994, extends comprehensive, high-
quality services to these young children and their parents, to make 
sure the most is made of this window of opportunity.
  We have added new provisions to encourage collaboration within states 
and local communities as well as within individual Head Start programs 
to expand the services they offer to families to full-day and full-year 
services, where appropriate, and to leverage other child care dollars 
to improve quality and better meet family needs.

[[Page S9086]]

  We emphasize the importance of school readiness and literacy 
preparation in Head Start. While I think this has always been a 
critical part of Head Start, this bill ensures that gains will continue 
to be made in this area.
  Mr. President, this bill puts Head Start on strong footing as we 
approach the 21st Century. It is a framework within which Head Start 
can continue to grow to meet the needs of more children and their 
families. What is unfortunate is that we cannot guarantee more funding 
for Head Start--I think it is shameful that there are waiting lists for 
Head Start and that only 40 percent of eligible children are served by 
this program. And Early Head Start, which is admittedly a new program, 
serves just a tiny fraction of the infants and toddlers in need of 
these services.
  The President has set a laudable goal to reach 1 million children by 
2002. But I say we need to do more. We need a plan to serve 2 million 
children--all those eligible and in need of services--as soon as 
possible.
  Some argue that meeting the goal of fully funding Head Start will be 
too costly. Yes, it will cost a great deal to get there. But my 
question is how much more will it cost not to get there?
  Studies show us that children in quality early childhood development 
programs, such as Head Start, start school more ready to learn than 
their non-Head Start counterparts. They are more likely to keep up with 
their classmates, avoid placement in special education, and graduate 
from high school. They are also less likely to become teenage mothers 
and fathers, go on welfare, or become involved in violence or the 
criminal justice system.
  How much does it cost when we don't see these benefits?
  I know this is an issue for another place and another venue. But I am 
hopeful as we strengthen the program we can also strengthen our resolve 
to expand this successful program to more children and their families.
  Mr. President, the bill before us also makes important changes to the 
Community Services Block Grant program. CSBG makes funds available to 
states and local communities to assist low-income individuals and help 
alleviate the causes of poverty. One thousand local service providers--
mainly Community Action Agencies--use these federal funds to address 
the root causes of poverty within their communities. CSBG dollars are 
particularly powerful because local communities have substantial 
flexibility in determining where these dollars are best spent to meet 
their local circumstances.
  I have had the pleasure of visiting Community Action Agencies in 
Connecticut many times. They are exciting, vibrant places at the very 
center of their communities--filled with adults taking literacy and job 
training courses, children at Head Start centers, seniors with housing 
or other concerns, and youths participating in programs or volunteering 
their time.
  To see clearly how critical the CSBG program is to the nation's low 
income families, one only needs to look at the statistics. The CSBG 
program in 1995 served more than 11.5 million people, or one in three 
Americans living in poverty. Three-quarters of CSBG clients have 
incomes that fall below the federal poverty guideline.
  This bill recognizes the fundamental strength of this program and 
makes modest changes to encourage broader participation by neighborhood 
groups. In addition, it improves the accountability of local programs.
  This bill also reauthorizes the vitally important Low Income Home 
Energy Assistance Program, or LIHEAP. Nearly 4.2 million low-income 
households received LIHEAP assistance during FY1996, more than 70,000 
households in Connecticut. One quarter of those assisted by LIHEAP 
funds are elderly. Another 25 percent are individuals with 
disabilities. I cannot overvalue the importance of this assistance--it 
is nearly as necessary as food and water to a low-income senior citizen 
or family with children seeking help to stay warm in the winter--or as 
we have seen recently in the Southwest--to stay cool during the summer.
  This bill makes no fundamental changes to the LIHEAP program. I am 
very pleased we increase the authorization of the program to $2 
billion, which recognizes the great need for this help. I wish House 
appropriators, who eliminated the program earlier this month, shared 
this commitment to meeting these most basic needs. We also put into 
place a system to more accurately and quickly designate natural 
disasters. Early disaster designation will allow for the more efficient 
distribution of the critically important emergency LIHEAP funds, aiding 
States devastated by a natural disaster.
  This bill contains one new, important program--the Individual 
Development Accounts, based on a bill offered by Senator Coats and 
Senator Harkin. Individual Development Accounts, or IDA's, are 
dedicated savings accounts for very low income families, similar in 
structure to IRA's, that can be used to pay for post-secondary 
education, buy a first home, or capitalize a business. This program is 
a welcome addition to the Human Services Act family. The Assets for 
Independence title will provide low-income individuals and families 
with new opportunities to move their families out of poverty through 
savings.
  This is strong bill and it is a good bill. And I want to thank 
Senator Coats again for his committed leadership on this important 
bill.
  Mr. KENNEDY. Mr. President, the Human Services Reauthorization Act 
before us today is landmark legislation and is backed by a broad bi-
partisan coalition. It represents legislation at its best, with Members 
on both sides of the aisle working closely together and with the 
Administration to achieve better results for America's children.
  I commend Senator Jeffords, Senator Coats, and Senator Dodd for their 
leadership in making this bill a reality. Together we have produced 
legislation that preserves and enhances these needed family programs 
while addressing the concerns that have been raised. Our bipartisan 
goal is to take these worthwhile programs and make them even better.
  The pending bill is an important step toward a more effective family 
policy. This legislation consolidates, reorganizes, and reauthorizes 
services for poor families and their children by investing in programs 
to strengthen families, promote child development, and build 
communities. In keeping with efforts to reinvent government, the Act 
promotes one-stop shopping by consolidating several existing 
categorical programs into more comprehensive and coordinated programs. 
It improves performance by developing outcome measures and monitoring 
progress, and it puts families first by promoting self-sufficiency. We 
have worked carefully to draft a bill that addresses the concerns of 
Senators on both sides of the aisle. I urge my colleagues to support 
this important bill, and I urge my colleagues in the House, both 
Democrat and Republican, to join together as we have to provide 
services to America's families.


                    Title I: Head Start Act of 1998

  Title I of the bill reauthorizes Head Start while making improvements 
in this strong and effective program. The 1994 Act significantly 
improved the quality and scope of Head Start services. The bill before 
us today recognizes these successes and builds on them.
  Before we acted in 1994, the Carnegie Foundation had released a 
report which called for a greater national effort to support low-income 
children, particularly those under age 3 who are at the greatest risk. 
The period between birth and age three is critical to be a child's 
development. Synapses not formed in a child's brain period can never be 
formed later.
  We responded to these findings by introducing the Early Head Start 
program to provide comprehensive services to families who qualify for 
Head Start and who have children under age 3. We introduced this 
program by phasing it in gradually over 4 years, and it is now 
providing crucial services to 40,000 of the nation's neediest infants 
and toddlers.
  The present bill continues to gradually expand this vital program, in 
keeping with advice from experts on child development. Early Head Start 
will be expanded to twice its size by 2002, so that 80,000 children can 
receive these services. This expansion will still serve only 1 out of 
every 25 eligible babies and toddlers, but it will give us more 
knowledge and experience on how to help most at this crucial period in 
children's lives.

[[Page S9087]]

  We have also added to Early Head Start a training and technical 
assistance fund which will enable the program to grow in quality. To 
maximize its effectiveness, it is important to ensure the highest 
possible quality. The set-aside in Head Start has helped to maintain 
and improve the quality of these services, and Early Head Start needs 
similar safeguards.
  In 1994, we also made significant improvements to Head Start by 
implementing stringent quality standards. As a result, dozens of 
programs not meeting these standards were closed down, and many more 
were brought back to health and now serve as strong programs. Today, we 
build on these improvements by adding requirements that ensure that 
children with disabilities will receive services appropriate to their 
needs and that Head Start centers will be physically accessible to 
children and their families. We have also sought more research, so that 
we can continue to build on this program in the most effective ways 
possible in future years.
  This legislation also includes three other priorities. It 
reauthorizes and amends the Community Services Block Grant and the Low 
Income Home Energy Assistance Program, and it creates demonstration 
projects to study the benefits of Individual Development Accounts.


          title ii: community services block grant act of 1998

  This bill recognizes the strength of the Community Services Block 
Grant program and leaves it largely unchanged. I am proud to have been 
a supporter of the Community Action Agencies funded under the CSBG 
block grants as long as I have been in the Senate. Robert Kennedy, as a 
Senator, sponsored the original Community Development Corporation 
legislation that is now funded under these block grants. Community 
Action Programs were created to respond to the complex social problems 
that face low-income individuals, families, and communities. These 
community-based public-private partnerships are a central part of the 
low-income service delivery network. In reauthorizing the Community 
Service Block Grant, we are promoting self sufficiency, family 
stability, and community revitalization.


                           title iii: liheap

  This legislation also reauthorizes the Low-Income Home Energy 
Assistance Program through the year 2004. For over four million LIHEAP 
beneficiaries across the nation, including 112,000 in Massachusetts, 
this program has made a major difference in the lives of thousands of 
working families and elderly households. Last week in Texas, for 
example, LIHEAP funds were made available to help families suffering 
from the triple-digit temperatures.
  LIHEAP does more than just keep households warm in the winter and 
cool in the summer. It is also a lynchpin for self-sufficiency.
  Many working parents are concerned about the health of their 
families. Researchers at Boston City Hospital have found that higher 
utility bills during the coldest months force low-income families to 
spend less money on food--the so-called ``heat or eat'' effect.
  Unfortunately, the House Appropriations Committee voted to eliminate 
funding for this important program. Unless this funding is restored--
and I am confident that it will be in the Senate--it will be a very 
cold Winter for millions of LIHEAP recipients across the nation.
  By reauthorizing LIHEAP, the Senate will be placing this program on a 
solid footing for the future. I am especially pleased that this 
legislation includes provisions that I sponsored with Senators Jeffords 
and Senator Harkin to clarify the criteria for the President to release 
emergency LIHEAP funds, so that needed funds can help low-income 
families adversely affected by hot or cold weather, ice storms, floods, 
earthquakes, and other natural disasters get through the emergency. In 
addition, it will enable the release of emergency LIHEAP funds if there 
is a significant increase in unemployment or home energy 
disconnections.


               title iv: individual development accounts

  Finally, this bill establishes Independent Development Account 
demonstration projects. This program will determine whether providing 
matching funds to poor individuals using savings accounts is an 
effective way to encourage them to save for their futures and develop 
self sufficiency. States and towns with such programs have seen 
impressive results. The demonstration projects in today's bill will 
enable us to see whether these programs can be effective nationwide.
  This bipartisan bill puts families first. It is an excellent example 
of what happens when we work together in the interest of American 
families. This legislation will benefit millions of families living in 
poverty, and will bring immeasurable benefits to our society as a 
whole. I urge the Senate to approve it.
  Mr. HATCH. Mr. President, I ask unanimous consent the committee 
substitute be agreed to, the bill be read a third time, and passed, the 
motion to reconsider be laid upon the table, and that any statements 
relating to S. 2206 appear in the Record.
  The PRESIDING OFFICER. Without objection, it is so ordered.
  The Committee amendment was agreed to.
  The bill was ordered to be engrossed for a third reading and was 
deemed read the third time.
  The bill (S. 2206), as amended, was passed.

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