SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Early Learning and Opportunity Act 
of 1997''.

SEC. 2. FINDINGS.

    The Congress finds the following:
            (1) The first 3 years of life are a critical period of 
        brain development, intellectual growth, and emotional, social, 
        affective, and moral development, that help determine the 
        health and productivity of a child in later life.
            (2) Scientific research shows that how individuals function 
        from preschool through adolescence and adulthood hinges to a 
        significant extent on the experiences children have in their 
        first 3 years of life.
            (3) One in 3 victims of physical abuse is a baby less than 
        1 year of age.
            (4) In 1993 the National Educational Goals Panel reported 
        that nearly half of infants in the United States do not have 
        what they need to grow and thrive.
            (5) High-quality care from a parent or other adult is 
        necessary to facilitate growth and development.
            (6) More than 50 percent of mothers with children less than 
        1 year of age are working outside the home.
            (7) More than 50 percent of working women are not covered 
        by the Family and Medical Leave Act of 1993, an Act that 
        provides a 12-week, unpaid parental leave.
            (8) The United States is the only industrialized country in 
        the world which does not provide paid maternity leave. Thirty 
        developing countries provide paid maternity leave.
            (9) Five million children under age 3 are in the care of 
        other adults while their parents work outside the home.
            (10) Parents of very young children have few child care 
        service options. Many cannot afford to stay home with their 
        children, or to pay for safe, high-quality developmental child 
        care services.
            (11) Statewide and multistate studies have found that less 
        than 20 percent of child care services for very young children 
        is of good quality; nearly 50 percent is of such substandard 
        quality that it adversely affects such children's development 
        and may put their health and safety at risk.
            (12) Families with children less than 3 years of age are 
        the single largest group living in poverty. Twenty-five percent 
        of such children, 3,000,000 children, are living below the 
        poverty line, are at greater risk for malnutrition, poor 
        health, and maltreatment, and are less likely to receive the 
        care they need from parents or other child care service 
        providers to grow and develop normally.

SEC. 3. PURPOSES.

    The purposes of this Act are--
            (1) to improve the quality, and to increase the 
        availability, of child care services for children less than 3 
        years of age,
            (2) to improve the affordability of child care services 
        available to such children,
            (3) to improve the quality, and to increase the 
        availability, of services to assist families to nurture such 
        children, and
            (4) to improve the coordination and effectiveness of 
        existing programs that provide such services to such children 
        and their families.

             TITLE I--EARLY LEARNING AND OPPORTUNITY GRANTS

SEC. 101. GRANTS FOR SERVICES.

    (a) Authority To Make Grants.--The Secretary of Health and Human 
Services may make grants, on a competitive basis, to eligible States to 
improve the quality, and to increase the availability, of child care 
services for very young children and of support services for the 
families of such children.
    (b) Priority.--For the purpose of making grants under subsection 
(a), the Secretary shall give priority to eligible States to the extent 
that such State, as demonstrated in the application for a grant under 
such subsection--
            (1) will minimize the administrative costs to be incurred 
        to carry out the plan contained in such application,
            (2) has coordinated the activities described in the plan 
        contained in such application, with providers of child care 
        services for children between 3 and 6 years of age, and with 
        providers of family support services for families of such 
        children, located in the State,
            (3) has taken substantial legislative or executive action 
        to reduce the duplication of, and barriers to providing, such 
        services, and
            (4) during the fiscal year for which such grant is 
        received, will reimburse such providers for such services at 
        rates that reflect--
                    (A) the higher costs incurred by such providers who 
                are accredited by national association that provides 
                accreditation for providers of the respective types of 
                such services and that is recognized by the Secretary, 
                and
                    (B) the higher costs incurred by such providers to 
                provide child care services to children who are very 
                young children.

SEC. 102. ELIGIBILITY FOR GRANTS.

    To be eligible to receive a grant under section 101, a State shall 
submit to the Secretary an application that satisfies the following 
requirements:
            (1) Such application is prepared by the State after 
        consultation with providers of child care services for very 
        young children, and with providers of family support services 
        for families of such children, located in the State.
            (2) Such application contains a plan that describes how the 
        State will expend such grant to do 1 or more of the following:
                    (A) To improve quality of child care services.
                    (B) To improve licensing standards applicable to 
                providers of child care services for very young 
                children in the State by specifying matters that apply 
                to providing child care services, such as child-to-
                staff ratios, group size, staff preparation and 
                qualifications, ongoing staff training, health and 
                safety, and linkages to parents and community services.
                    (C) To improve enforcement of licensing standards 
                applicable to providers of child care services for care 
                for very young children in the State.
                    (D) To improve salaries for caregivers of such 
                child care services.
                    (E) To support ongoing and more advanced training 
                for such caregivers (including training to provide 
                child care services for children with special needs) 
                and to create incentives for individuals to obtain, and 
                child care centers to employ individuals who have 
                obtained, more advanced training in providing child 
                care services.
                    (F) To improve accessibility to child care services 
                for very young children, including improving the 
                quality of, and expanding the availability of, resource 
                and referral services and transportation services for 
                families with very young children.
                    (G) To improve affordability of child care services 
                for very young children.
                    (H) To improve and expand support services to 
                families with very young children.
                    (I) To improve coordination of existing Federal and 
                State programs that provide support services for 
                families with very young children.
            (3) Such application shall contain assurances that--
                    (i) not more than 70 percent of the cost of 
                carrying out the plan contained in such application 
                will be paid with such grant together with any other 
                available Federal funds,
                    (ii) such grant will be used to supplement, not 
                supplant, non-Federal funds otherwise available to 
                provide child care services for very young children and 
support services for the families of such children,
                    (iii) the State will expend in cash or in kind, 
                from State resources (including private contributions 
                and excluding resources available to local governmental 
                entities) an amount not less than 30 percent of the 
                amount of such grant, and
                    (iv) such grant will be administered by the lead 
                agency that is designated by the State under section 
                658D of the Child Care and Development Block Grant Act 
                of 1990 (42 U.S.C. 9858b).
            (4) Such application shall contain such other information 
        and assurances as the Secretary may require by rule.

SEC. 103. MODEL TRAINING PROGRAM FOR EMPLOYEES OF CHILD CARE PROVIDERS.

    The Secretary shall--
            (1) by adapting the requirements in effect under section 
        1792(a) of title 10, United States Code, develop a voluntary 
        model training program applicable to individuals who are 
        employed as caregivers by providers of child care services,
            (2) make available to Head Start agencies and providers of 
        child care services the model training code developed under 
        paragraph (1), and
            (3) provide to such agencies and such providers technical 
        assistance to implement such program.

SEC. 104. DEFINITIONS.

    For purposes of this title:
            (1) Caregiver.--The term ``caregiver'' means an individual 
        who provides a service directly to a child on a person-to-
        person basis.
            (2) Family support services.--The term ``family support 
        services'' means community-based activities designed to promote 
        parental competencies and behaviors that will increase the 
        ability of families to successfully nurture their children.
            (3) Secretary.--The term ``Secretary'' means the Secretary 
        of Health and Human Services.
            (4) Very young children.--The term ``very young children'' 
        means children who are less than 3 years of age.

SEC. 105. AUTHORIZATION OF APPROPRIATIONS.

    There is authorized to be appropriated to carry out this title 
$360,000,000 for each of the fiscal years 1998, 1999, 2000, 2001, and 
2002.

          TITLE II--AMENDMENT TO INTERNAL REVENUE CODE OF 1986

SEC. 201. REFERENCES.

    Except as otherwise expressly provided, whenever 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 Internal Revenue Code of 
1986.

SEC. 202. TAXATION OF INCOME OF CONTROLLED FOREIGN CORPORATIONS 
              ATTRIBUTABLE TO IMPORTED PROPERTY.

    (a) General Rule.--Subsection (a) of section 954 (defining foreign 
base company income) is amended by striking ``and'' at the end of 
paragraph (4), by striking the period at the end of paragraph (5) and 
inserting ``, and'', and by adding at the end the following new 
paragraph:
            ``(6) imported property income for the taxable year 
        (determined under subsection (h) and reduced as provided in 
        subsection (b)(5)).''
    (b) Definition of Imported Property Income.--Section 954 is amended 
by adding at the end the following new subsection:
    ``(h) Imported Property Income.--
            ``(1) In general.--For purposes of subsection (a)(6), the 
        term `imported property income' means income (whether in the 
        form of profits, commissions, fees, or otherwise) derived in 
        connection with--
                    ``(A) manufacturing, producing, growing, or 
                extracting imported property,
                    ``(B) the sale, exchange, or other disposition of 
                imported property, or
                    ``(C) the lease, rental, or licensing of imported 
                property.
        Such term shall not include any foreign oil and gas extraction 
        income (within the meaning of section 907(c)) or any foreign 
        oil related income (within the meaning of section 907(c)).
            ``(2) Imported property.--For purposes of this subsection--
                    ``(A) In general.--Except as otherwise provided in 
                this paragraph, the term `imported property' means 
                property which is imported into the United States by 
                the controlled foreign corporation or a related person.
                    ``(B) Imported property includes certain property 
                imported by unrelated persons.--The term `imported 
                property' includes any property imported into the 
                United States by an unrelated person if, when such 
                property was sold to the unrelated person by the 
                controlled foreign corporation (or a related person), 
                it was reasonable to expect that--
                            ``(i) such property would be imported into 
                        the United States, or
                            ``(ii) such property would be used as a 
                        component in other property which would be 
                        imported into the United States.
                    ``(C) Exception for property subsequently 
                exported.--The term `imported property' does not 
                include any property which is imported into the United 
                States and which--
                            ``(i) before substantial use in the United 
                        States, is sold, leased, or rented by the 
                        controlled foreign corporation or a related 
                        person for direct use, consumption, or 
                        disposition outside the United States, or
                            ``(ii) is used by the controlled foreign 
                        corporation or a related person as a component 
                        in other property which is so sold, leased, or 
                        rented.
            ``(3) Definitions and special rules.--
                    ``(A) Import.--For purposes of this subsection, the 
                term `import' means entering, or withdrawal from 
                warehouse, for consumption or use. Such term includes 
                any grant of the right to use an intangible (as defined 
                in section 936(b)(3)(B)) in the United States.
                    ``(B) Unrelated person.--For purposes of this 
                subsection, the term `unrelated person' means any 
                person who is not a related person with respect to the 
                controlled foreign corporation.
                    ``(C) Coordination with foreign base company sales 
                income.--For purposes of this section, the term 
                `foreign base company sales income' shall not include 
                any imported property income.''
    (c) Separate Application of Limitations on Foreign Tax Credit for 
Imported Property Income.--
            (1) In general.--Paragraph (1) of section 904(d) (relating 
        to separate application of section with respect to certain 
        categories of income) is amended by striking ``and'' at the end 
        of subparagraph (H), by redesignating subparagraph (I) as 
        subparagraph (J), and by inserting after subparagraph (H) the 
        following new subparagraph:
                    ``(I) imported property income, and''.
            (2) Imported property income defined.--Paragraph (2) of 
        section 904(d) is amended by redesignating subparagraphs (H) 
        and (I) as subparagraphs (I) and (J), respectively, and by 
        inserting after subparagraph (G) the following new 
        subparagraph:
                    ``(H) Imported property income.--The term `imported 
                property income' means any income received or accrued 
                by any person which is of a kind which would be 
                imported property income (as defined in section 
                954(h)).''
            (3) Look-through rules to apply.--Subparagraph (F) of 
        section 904(d)(3) is amended by striking ``or (E)'' and 
        inserting ``(E), or (H)''.
    (d) Technical Amendments.--
            (1) Clause (iii) of section 952(c)(1)(B) (relating to 
        certain prior year deficits may be taken into account) is 
        amended by inserting the following subclause after subclause 
        (II) (and by redesignating the following subclauses 
        accordingly):
                            ``(III) imported property income,''.
            (2) Paragraph (5) of section 954(b) (relating to deductions 
        to be taken into account) is amended by striking ``and the 
        foreign base company oil related income'' and inserting ``the 
        foreign base company oil related income, and the imported 
        property income''.
    (e) Effective Date.--
            (1) In general.--Except as provided in paragraph (2), the 
        amendments made by this section shall apply to taxable years of 
        foreign corporations beginning after December 31, 1996, and to 
        taxable years of United States shareholders within which or 
        with which such taxable years of such foreign corporations end.
            (2) Subsection (c).--The amendments made by subsection (c) 
        shall apply to taxable years beginning after December 31, 1996.

      TITLE III--AMENDMENT TO FAMILY AND MEDICAL LEAVE ACT OF 1993

SEC. 301. COVERAGE OF EMPLOYEES.

    Paragraphs (2)(B)(ii) and (4)(A)(i) of section 101 of the Family 
and Medical Leave Act of 1993(29 U.S.C. 2611 (2)(B)(ii) and (4)(A)(i)) 
are each amended by striking ``50'' each place it appears and inserting 
``20''.

SEC. 302. EFFECTIVE DATE.

    This title shall take effect 120 days after the date of the 
enactment of this Act.

               TITLE IV--AMENDMENTS TO THE HEAD START ACT

SEC. 401. AUTHORIZATION OF APPROPRIATIONS.

    Section 639(a) of the Head Start Act (42 U.S.C. 9834(a)) is amended 
by inserting before the period at the end the following: ``, 
$4,900,000,000 for fiscal year 1999, $5,500,000,000 for fiscal year 
2000, $6,100,000,000 for fiscal year 2001, and $6,700,000,000 for 
fiscal year 2002''.

SEC. 402. ALLOTMENT OF FUNDS.

    (a) Training and Technical Assistance.--Section 640(a)(2)(C) of the 
Head Start Act (42 U.S.C. 9835(a)(2)(C)) is amended by striking ``2 
percent'' and inserting ``3 percent''.
    (b) Programs for Families With Infants and Toddlers.--Section 
640(a)(6) of the Head Start Act (42 U.S.C. 9835(a)(6)) is amended--
            (1) by striking ``1997, and'' and inserting ``1997,'', and
            (2) by inserting after ``1998,'' the following: ``, 6 
        percent for fiscal year 1999, 7 percent for fiscal year 2000, 8 
        percent for fiscal year 2001, and 9 percent for fiscal year 
        2002''.

SEC. 403. EFFECTIVE DATE.

    This title and the amendments made by this title shall take effect 
on October 1, 1997.
TABLE OF CONTENTS: 
     Title I:  Early Learning and Opportunity Grants 
     Title II:  Amendment to Internal Revenue Code of 1986 
     Title III:  Amendment to Family and Medical Leave Act of 1993 
     Title IV:  Amendments to the Head Start Act 
Early Learning and Opportunity Act of 1997 - 
Title I:  Early Learning and Opportunity Grants
 - Authorizes the Secretary of Health and Human Services to make grants to eligible States to improve the quality and increase the availability of child care services, and of family support services, for families with children less than three years of age. 
(Sec. 103) Directs the Secretary to:  (1) develop a voluntary model training program for employees of child care providers; (2) make available to Head Start agencies and child care providers the code developed for such model training program; and (3) provide technical assistance to such agencies and providers to implement it. 
(Sec. 105) Authorizes appropriations. 
Title II:  Amendment to Internal Revenue Code of 1986
 - Amends the Internal Revenue Code to include imported property income (except for foreign oil and gas related income, or property subsequently exported) as foreign base company income in the gross income of a U.S. shareholder of a controlled foreign corporation. 
Title III:  Amendment to Family and Medical Leave Act of 1993
 - Amends the Family and Medical Leave Act of 1993 to extend its coverage to employers with more than 20 employees (current law applies only to employers with more than 50 employees). 
Title IV:  Amendment to the Head Start Act
 - Amends the Head Start Act to extend the authorization of appropriations. 
(Sec. 402) Revises a formula for allotment of certain training and technical assistance funds under such Act.  Increases the amount of funds reserved for services to families with children less than three years of age (programs for families with infants and toddlers).
Early Learning and Opportunity Act of 1997