II

October 28 (legislative day, October 26), 1995

Ordered to be printed as passed

In the Senate of the United States,

October 28 (legislative day, October 26), 1995.

Resolved, That the bill from the House of Representatives (H.R. 2491) entitled ‘‘An Act to provide for reconciliation pursuant to section 105 of the concurrent resolution on

the budget for fiscal year 1996’’, do pass with the following

AMENDMENT:

Strike out all after the enacting clause and insert:

1 SECTION 1. SHORT TITLE.

2 This Act may be cited as the ‘‘Balanced Budget Rec3 onciliation Act of 1995’’.

4 SEC. 2. TABLE OF TITLES.

5 The table of titles for this Act is as follows:

Title I. Committee on Agriculture, Nutrition, and Forestry.

Title II. Committee on Armed Services.

Title III. Committee on Banking, Housing, and Urban Affairs.

Title IV. Committee on Commerce, Science, and Transportation.

Title V. Committee on Energy and Natural Resources.

Title VI. Committee on Environment and Public Works.

Title VII. Committee on Finance—Spending Control Provisions.

Title VIII. Committee on Governmental Affairs.

Title IX. Committee on the Judiciary.

Title X. Committee on Labor and Human Resources.

Title XI. Committee on Veterans’ Affairs.

Title XII. Committee on Finance—Revenue Provisions.

Title XIII. Miscellaneous Provisions.
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1 TITLE I—COMMITTEE ON AGRI2 CULTURE, NUTRITION, AND

3 FORESTRY

4 SEC. 1001. SHORT TITLE; TABLE OF CONTENTS.

5 (a) SHORT TITLE.—This title may be cited as the ‘‘Ag6 ricultural Reconciliation Act of 1995’’.

7 (b) TABLE OF CONTENTS.—The table of contents of this

8 title is as follows:

Sec. 1001. Short title; table of contents.

Subtitle A—Commodity Programs

Sec. 1101. Eligibility for enrollment in annual programs.

Sec. 1102. Rice program.

Sec. 1103. Cotton program.

Sec. 1104. Feed grain program.

Sec. 1105. Wheat program.

Sec. 1106. Milk program.

Sec. 1107. Oilseeds program.

Sec. 1108. Sugar program.

Sec. 1109. Acreage base and yield system.

Sec. 1110. Extension of related price support provisions.

Sec. 1111. Repeal of miscellaneous authorities.

Sec. 1112. Commodity Credit Corporation interest rate.

Sec. 1113. Peanut program.

Sec. 1114. Catastrophic crop insurance coverage.

Sec. 1115. Savings adjustment.

Sec. 1116. Sense of the Senate regarding tax provisions relating to ethanol.

Sec. 1117. Effective date.

Subtitle B—Conservation

Sec. 1201. Conservation.

Subtitle C—Agricultural Promotion and Export Programs

Sec. 1301. Market promotion program.

Sec. 1302. Export enhancement program.

Sec. 1303. Export of sunflowerseed oil and cottonseed oil.

Subtitle D—Nutrition Assistance

CHAPTER 1—FOOD STAMP PROGRAM

Sec. 1401. Treatment of children living at home.

Sec. 1402. Optional additional criteria for separate household determinations.

Sec. 1403. Adjustment of thrifty food plan.
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Sec. 1404. Definition of homeless individual.

Sec. 1405. State options in regulations.

Sec. 1406. Energy assistance.

Sec. 1407. Deductions from income.

Sec. 1408. Amount of vehicle asset limitation.

Sec. 1409. Benefits for aliens.

Sec. 1410. Disqualification.

Sec. 1411. Employment and training.

Sec. 1412. Income calculation.

Sec. 1413. Comparable treatment for disqualification.

Sec. 1414. Cooperation with child support agencies.

Sec. 1415. Disqualification for child support arrears.

Sec. 1416. Permanent disqualification for participating in 2 or more States.

Sec. 1417. Work requirement.

Sec. 1418. Disqualification of fleeing felons.

Sec. 1419. Electronic benefit transfers.

Sec. 1420. Minimum benefit.

Sec. 1421. Benefits on recertification.

Sec. 1422. Failure to comply with other welfare and public assistance programs.

Sec. 1423. Allotments for households residing in institutions.

Sec. 1424. Collection of overissuances.

Sec. 1425. Termination of Federal match for optional information activities.

Sec. 1426. Work supplementation or support program.

Sec. 1427. Private sector employment initiatives.

Sec. 1428. Reauthorization of appropriations.

Sec. 1429. Optional State food assistance block grant.

Sec. 1430. Effective date.

CHAPTER 2—CHILD NUTRITION PROGRAMS

PART I—REIMBURSEMENT RATES

Sec. 1441. Termination of additional payment for lunches served in high free and

reduced price participation schools.

Sec. 1442. Lunches, breakfasts, and supplements.

Sec. 1443. Free and reduced price breakfasts.

Sec. 1444. Conforming reimbursement for paid breakfasts and lunches.

PART II—GRANT PROGRAMS

Sec. 1451. School breakfast startup grants.

PART III—OTHER AMENDMENTS

Sec. 1461. Child and adult care food program.

CHAPTER 3—ADDITIONAL SAVINGS

Sec. 1471. Earnings of students.

Sec. 1472. Standard deduction.

Sec. 1473. Vendor payments for transitional housing counted as income.

Sec. 1474. Extending claims retention rates.

Sec. 1475. Reauthorization of Puerto Rico nutrition assistance program.

Sec. 1476. Value of food assistance.

Sec. 1477. Commodity assistance.

Sec. 1478. Summer food service program for children.

Sec. 1479. Special milk program.
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Sec. 1480. Nutrition education and training programs.

Sec. 1481. Effective date.

CHAPTER 4—EFFECTIVE DATE

Sec. 1491. Effective date.

1 Subtitle A—Commodity Programs

2 SEC. 1101. ELIGIBILITY FOR ENROLLMENT IN ANNUAL PRO3 GRAMS.

4 (a) IN GENERAL.—Title III of the Agricultural Act of

5 1949 (7 U.S.C. 1447 et seq.) is amended to read as follows:

6 ‘‘TITLE III—ANNUAL PROGRAMS

7 FOR 1996 THROUGH 2002 CROPS

8 ‘‘SEC. 301. ELIGIBILITY FOR ENROLLMENT IN ANNUAL PRO9 GRAMS.

10 ‘‘(a) IN GENERAL.—To be eligible for enrollment in

11 1 or more of the annual programs established under this

12 title, the land on a farm must have been enrolled in 1 or

13 more of the annual programs established under this Act for

14 rice, upland cotton, feed grains, or wheat for a total of at

15 least 3 of the 1991 through 1995 crop years, as determined

16 by the Secretary.

17 ‘‘(b) ADDITIONAL CRITERIA.—In addition to the re18 quirements of subsection (a), for the purpose of determining

19 the eligibility of land for enrollment in 1 or more of the

20 annual programs established under this title, the Secretary

21 shall include acreage on the farm considered planted under

22 section 503(c), including a certification of crop acreage base
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1 filed with the Secretary in order to preserve base history,

2 for any of the 1991 through 1995 crops.

3 ‘‘(c) ELIGIBILITY TO RECEIVE PAYMENTS AND

4 LOANS.—Enrollment in the annual program for a program

5 crop shall be required as a condition of the receipt of any

6 payment or loan under this title for the program crop.’’.

7 (b) CONFORMING AMENDMENTS.—The Agricultural

8 Act of 1949 is amended—

9 (1) in title I (7 U.S.C. 1441 et seq.)—

10 (A) by striking all sections other than sec11 tions 101B, 103B, 104(d), 105B, 106, 106A,

12 106B, 107B, 108B, 111, 114, and 115; and

13 (B) by moving sections 101B, 103B, 105B,

14 and 107B to the end of title III (as amended by

15 subsection (a)) and redesignating the sections as

16 sections 302, 303, 304, and 305, respectively;

17 (2) in title II (7 U.S.C. 1446 et seq.), by striking

18 all sections other than sections 202, 204, 205, and

19 206; and

20 (3) by striking title VI (7 U.S.C. 1471 et seq.).

21 SEC. 1102. RICE PROGRAM.

22 Section 302 of the Agricultural Act of 1949 (as redesig23 nated by section 1101(b)(1)(B)) is amended—

24 (1) by striking the section heading and inserting

25 the following:
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1 ‘‘SEC. 302. LOANS AND PAYMENTS FOR THE 1991 THROUGH

2 2002 CROPS OF RICE.’’;

3 (2) in subsection (a)—

4 (A) in paragraph (1), by striking ‘‘1995’’

5 and inserting ‘‘2002’’;

6 (B) in paragraph (3), by striking ‘‘1995’’

7 and inserting ‘‘2002’’; and

8 (C) in paragraph (5)(D)(i), by striking

9 ‘‘August 1, 1991, and ending July 31, 1996’’ and

10 inserting ‘‘August 1, 1996, and ending July 31,

11 2003’’;

12 (3) in subsection (b)(1), by striking ‘‘1995’’ and

13 inserting ‘‘2002’’;

14 (4) in subsection (c)(1)—

15 (A) in subparagraph (A), by striking

16 ‘‘1995’’ and inserting ‘‘2002’’;

17 (B) in subparagraph (B)—

18 (i) in clause (ii)—

19 (I) in the clause heading, by strik20 ing ‘‘AND 1995’’ and inserting

21 ‘‘THROUGH 2002’’; and

22 (II) by striking ‘‘and 1995’’ and

23 inserting ‘‘through 2002’’;

24 (ii) by redesignating clause (iii) as

25 clause (iv);
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1 (iii) by inserting after clause (ii) the

2 following:

3 ‘‘(iii) MAXIMUM PAYMENT RATE.—The

4 payment rate for rice under this subsection

5 shall not exceed (per hundredweight) $4.21

6 for the 1996 crop, $4.19 for the 1997 crop,

7 $3.86 for the 1998 crop, $3.48 for the 1999

8 crop, $3.23 for the 2000 crop, $2.89 for the

9 2001 crop, and $2.66 for the 2002 crop.’’;

10 and

11 (iv) in clause (iv) (as so redesignated),

12 by striking ‘‘1995’’ and inserting ‘‘2002’’;

13 (C) in subparagraph (C)—

14 (i) in clause (i), by striking ‘‘within

15 the permitted acreage’’; and

16 (ii) in clause (ii)—

17 (I) by striking ‘‘85 percent’’ and

18 inserting ‘‘70 percent’’; and

19 (II) by striking ‘‘less the quan20 tity’’ and all that follows through

21 ‘‘(e)(2)(D))’’;

22 (D) in subparagraph (D)—

23 (i) in the subparagraph heading, by

24 striking ‘‘50/85’’ and inserting ‘‘25/75’’;

25 (ii) in clause (i)—
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1 (I) by striking ‘‘an acreage’’ and

2 all that follows through ‘‘rice and’’;

3 (II) by striking ‘‘15 percent’’ each

4 place it appears and inserting ‘‘25 per5 cent’’;

6 (III) by striking ‘‘1997 crops (ex7 cept as provided in clause (v)(II))’’

8 each place it appears and inserting

9 ‘‘2002 crops’’;

10 (IV) by striking ‘‘(except as pro11 vided in subparagraph (E))’’ each

12 place it appears and inserting ‘‘or al13 ternative crops described in subpara14 graph (E)’’; and

15 (V) in subclause (I), by striking

16 ‘‘for the purpose’’ and all that follows

17 through ‘‘(e)(2)(D)’’;

18 (iii) in clause (ii), by striking ‘‘50 per19 cent’’ and inserting ‘‘25 percent’’;

20 (iv) in clause (iii), by striking ‘‘(or

21 other uses as provided in subparagraph

22 (E))’’ and inserting ‘‘or alternative crops

23 described in subparagraph (E)’’;

24 (v) in clause (v)—
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1 (I) in the clause heading, by strik2 ing ‘‘PREVENTED PLANTING AND RE3 DUCED’’ and inserting ‘‘REDUCED’’;

4 (II) in the first sentence of

5 subclause (I), by striking ‘‘under sub6 section (e)’’; and

7 (III) in subclause (II)—

8 (aa) in the subclause head9 ing, by striking ‘‘1997’’ and insert10 ing ‘‘2002’’;

11 (bb) by striking ‘‘1997’’ and

12 inserting ‘‘2002’’;

13 (cc) by striking ‘‘if an acre14 age limitation’’ and all that fol15 lows through ‘‘(aa) the’’ and in16 serting ‘‘if the’’;

17 (dd) by striking ‘‘be pre18 vented from planting the crop or’’;

19 (ee) by striking ‘‘8 percent’’

20 the first place it appears and in21 serting ‘‘25 percent’’; and

22 (ff) by striking ‘‘uses; or’’

23 and all that follows through the

24 period at the end of the subclause

25 and inserting ‘‘uses.’’;
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1 (vi) in clause (vi), by striking ‘‘per2 mitted rice’’ and all that follows through

3 ‘‘this subparagraph’’ and inserting ‘‘rice

4 payment acres of the farm was devoted to

5 conserving uses or alternative crops de6 scribed in subparagraph (E)’’; and

7 (vii) by striking clause (viii); and

8 (E) in the first sentence of subparagraph

9 (E)(ii), by inserting before the period at the end

10 the following: ‘‘or other oilseeds as determined by

11 the Secretary’’;

12 (5) by striking subsection (e) and inserting the

13 following:

14 ‘‘(e) HAYING AND GRAZING.—

15 ‘‘(1) IN GENERAL.—Except as provided in para16 graph (2), haying and grazing of acreage under sub17 section (c)(1)(C) shall be permitted, except during

18 any consecutive 5-month period that is established by

19 the State committee established under section 8(b) of

20 the Soil Conservation and Domestic Allotment Act

21 (16 U.S.C. 590h(b)) for a State. The 5-month period

22 shall be established during the period beginning April

23 1, and ending October 31, of a year.

24 ‘‘(2) NATURAL DISASTERS.—In the case of a nat25 ural disaster, the Secretary may permit unlimited
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1 haying and grazing on the acreage. The Secretary

2 may not exclude irrigated or irrigable acreage not

3 planted to alfalfa when exercising the authority under

4 this paragraph.’’;

5 (6) in subsection (f)—

6 (A) in paragraph (1), by striking ‘‘1995’’

7 and inserting ‘‘2002’’; and

8 (B) in paragraph (4)(C), by striking ‘‘re9 duced by’’ and all that follows through ‘‘sub10 section (e)’’; and

11 (7) in subsection (n), by striking ‘‘1995’’ and in12 serting ‘‘2002’’.

13 SEC. 1103. COTTON PROGRAM.

14 Section 303 of the Agricultural Act of 1949 (as redesig15 nated by section 1101(b)(1)(B)) is amended—

16 (1) by striking the section heading and inserting

17 the following:

18 ‘‘SEC. 303. LOANS AND PAYMENTS FOR THE 1991 THROUGH

19 2002 CROPS OF UPLAND COTTON.’’;

20 (2) in subsection (a)—

21 (A) in paragraph (1), by striking ‘‘1997’’

22 and inserting ‘‘2002’’;

23 (B) by striking paragraph (4) and inserting

24 the following:
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1 ‘‘(4) STORAGE PAYMENTS.—The producer shall

2 pay the cost of all storage payments incurred for a

3 10-month nonrecourse loan.’’; and

4 (C) in paragraph (5)—

5 (i) by striking ‘‘August 1, 1991, and

6 ending July 31, 1998’’ each place it ap7 pears and inserting ‘‘August 1, 1996, and

8 ending July 31, 2003’’;

9 (ii) in subparagraph (E), by striking

10 ‘‘1.25 cents’’ each place it appears and in11 serting ‘‘2.50 cents’’; and

12 (iii) in subparagraph (F)(i), by strik13 ing ‘‘August 1991 and ending July 31,

14 1998’’ and inserting ‘‘August 1, 1996, and

15 ending July 31, 2003’’;

16 (3) in subsection (b)(1), by striking ‘‘1997’’ and

17 inserting ‘‘2002’’;

18 (4) in subsection (c)(1)—

19 (A) in subparagraph (A), by striking

20 ‘‘1997’’ and inserting ‘‘2002’’;

21 (B) in subparagraph (B)—

22 (i) by redesignating clause (ii) as

23 clause (iii);

24 (ii) by inserting after clause (i) the fol25 lowing:
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1 ‘‘(ii) MAXIMUM PAYMENT RATE.—The

2 payment rate for upland cotton under this

3 subsection shall not exceed (per pound) 8.6

4 cents for the 1996 crop, 12.1 cents for the

5 1997 crop, 13.1 cents for the 1998 crop,

6 13.6 cents for the 1999 crop, 13.0 cents for

7 the 2000 crop, 12.0 cents for the 2001 crop,

8 and 11.5 cents for the 2002 crop.’’; and

9 (iii) in clause (iii) (as so redesig10 nated), by striking ‘‘1997’’ and inserting

11 ‘‘2002’’;

12 (C) in subparagraph (C)—

13 (i) in clause (i), by striking ‘‘within

14 the permitted acreage’’; and

15 (ii) in clause (ii)—

16 (I) by striking ‘‘85 percent’’ and

17 inserting ‘‘70 percent’’; and

18 (II) by striking ‘‘less the quan19 tity’’ and all that follows through

20 ‘‘(e)(2)(D))’’;

21 (D) in subparagraph (D)—

22 (i) in the subparagraph heading, by

23 striking ‘‘50/85’’ and inserting ‘‘0/85’’;

24 (ii) in clause (i)—
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1 (I) by striking ‘‘an acreage’’ and

2 all that follows through ‘‘cotton and’’;

3 (II) by striking ‘‘1997 crops (ex4 cept as provided in clause (v)(II))’’

5 each place it appears and inserting

6 ‘‘2002 crops’’;

7 (III) by striking ‘‘(except as pro8 vided in subparagraph (E))’’ each

9 place it appears and inserting ‘‘or al10 ternative crops described in subpara11 graph (E)’’;

12 (IV) in subclause (I), by striking

13 ‘‘for the purpose’’ and all that follows

14 through ‘‘(e)(2)(D)’’; and

15 (V) in subclause (II), by striking

16 ‘‘, subject to the compliance of the pro17 ducers with clause (ii)’’;

18 (iii) by striking clauses (ii) and (viii);

19 (iv) by redesignating clauses (iii)

20 through (vii) and clause (ix) as clauses (ii)

21 through (vi) and clause (vii), respectively;

22 (v) in clause (ii) (as so redesignated),

23 by striking ‘‘(or other uses as provided in

24 subparagraph (E))’’ and inserting ‘‘or al-
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1 ternative crops described in subparagraph

2 (E)’’;

3 (vi) in clause (iii) (as so redesignated),

4 by striking ‘‘, without regard to the require5 ment imposed under clause (ii),’’;

6 (vii) in clause (iv) (as so redesig7 nated)—

8 (I) in the clause heading, by strik9 ing ‘‘PREVENTED PLANTING AND RE10 DUCED’’ and inserting ‘‘REDUCED’’;

11 (II) in the first sentence of

12 subclause (I)—

13 (aa) by striking ‘‘under sub14 section (e)’’; and

15 (bb) by striking ‘‘without re16 gard to the requirement imposed

17 under clause (ii)’’; and

18 (III) in subclause (II)—

19 (aa) in the subclause head20 ing, by striking ‘‘1997’’ and insert21 ing ‘‘2002’’;

22 (bb) by striking ‘‘1997’’ and

23 inserting ‘‘2002’’;

24 (cc) by striking ‘‘clause (iii)

25 without regard’’ and all that fol-
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1 lows through ‘‘(aa) the’’ and in2 serting ‘‘clause (ii) if the’’;

3 (dd) by striking ‘‘be pre4 vented from planting the crop or’’;

5 (ee) by striking ‘‘8 percent’’

6 the first place it appears and in7 serting ‘‘15 percent’’; and

8 (ff) by striking ‘‘uses; or’’

9 and all that follows through the

10 period at the end of the subclause

11 and inserting ‘‘uses.’’;

12 (viii) in clause (v) (as so redesignated),

13 by striking ‘‘permitted cotton’’ and all that

14 follows through ‘‘this subparagraph’’ and

15 inserting ‘‘cotton payment acres of the farm

16 was devoted to conserving uses or alter17 native crops described in subparagraph

18 (E)’’; and

19 (ix) in clause (vi) (as so redesignated),

20 by striking ‘‘(vi)’’ and inserting ‘‘(v)’’; and

21 (E) in the first sentence of subparagraph

22 (E)(ii), by inserting before the period at the end

23 the following: ‘‘or other oilseeds as determined by

24 the Secretary’’;
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1 (5) by striking subsection (e) and inserting the

2 following:

3 ‘‘(e) HAYING AND GRAZING.—

4 ‘‘(1) IN GENERAL.—Except as provided in para5 graph (2), haying and grazing of acreage under sub6 section (c)(1)(C) shall be permitted, except during

7 any consecutive 5-month period that is established by

8 the State committee established under section 8(b) of

9 the Soil Conservation and Domestic Allotment Act

10 (16 U.S.C. 590h(b)) for a State. The 5-month period

11 shall be established during the period beginning April

12 1, and ending October 31, of a year.

13 ‘‘(2) NATURAL DISASTERS.—In the case of a nat14 ural disaster, the Secretary may permit unlimited

15 haying and grazing on the acreage. The Secretary

16 may not exclude irrigated or irrigable acreage not

17 planted to alfalfa when exercising the authority under

18 this paragraph.’’;

19 (6) in subsection (f)—

20 (A) in paragraph (1), by striking ‘‘1995’’

21 and inserting ‘‘2002’’; and

22 (B) in paragraph (4)(C), by striking ‘‘re23 duced by’’ and all that follows through ‘‘sub24 section (e)’’; and
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1 (7) in subsection (o), by striking ‘‘1997’’ and in2 serting ‘‘2002’’.

3 SEC. 1104. FEED GRAIN PROGRAM.

4 Section 304 of the Agricultural Act of 1949 (as redesig5 nated by section 1101(b)(1)(B)) is amended—

6 (1) by striking the section heading and inserting

7 the following:

8 ‘‘SEC. 304. LOANS AND PAYMENTS FOR THE 1991 THROUGH

9 2002 CROPS OF FEED GRAINS.’’;

10 (2) in subsection (a)—

11 (A) in paragraph (1), by striking ‘‘1995’’

12 and inserting ‘‘2002’’;

13 (B) in paragraph (4)—

14 (i) in subparagraph (A)—

15 (I) by striking ‘‘may’’ and insert16 ing ‘‘shall’’;

17 (II) in clause (i), by inserting

18 ‘‘or’’ after the semicolon; and

19 (III) in clause (iii), by striking

20 ‘‘(iii) the’’ and inserting the following:

21 ‘‘(III) the’’; and

22 (ii) in subparagraph (C), by striking

23 ‘‘1995’’ and inserting ‘‘2002’’; and

24 (C) in paragraph (6), by striking ‘‘1995’’

25 and inserting ‘‘2002’’;
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1 (3) in subsection (b)(1), by striking ‘‘1995’’ and

2 inserting ‘‘2002’’;

3 (4) in subsection (c)(1)—

4 (A) in subparagraph (A), by striking

5 ‘‘1995’’ and inserting ‘‘2002’’;

6 (B) in subparagraph (B)—

7 (i) in clause (ii)—

8 (I) in the clause heading, by strik9 ing ‘‘AND 1995’’ and inserting

10 ‘‘THROUGH 2002’’; and

11 (II) by striking ‘‘and 1995’’ and

12 inserting ‘‘through 2002’’;

13 (ii) by redesignating clause (iii) as

14 clause (iv);

15 (iii) by inserting after clause (ii) the

16 following:

17 ‘‘(iii) MAXIMUM PAYMENT RATE.—The

18 payment rates under this subsection shall

19 not exceed (per bushel)—

20 ‘‘(I) in the case of corn, $.53 for

21 the 1996 crop, $.53 for the 1997 crop,

22 $.57 for the 1998 crop, $.56 for the

23 1999 crop, $.53 for the 2000 crop, $.54

24 for the 2001 crop, and $.55 for the

25 2002 crop;
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1 ‘‘(II) in the case of grain sor2 ghums, $.59 for the 1996 crop, $.59 for

3 the 1997 crop, $.63 for the 1998 crop,

4 $.61 for the 1999 crop, $.59 for the

5 2000 crop, $.60 for the 2001 crop, and

6 $.61 for the 2002 crop;

7 ‘‘(III) in the case of oats, $.12 for

8 the 1996 crop, $.11 for the 1997 crop,

9 $.12 for the 1998 crop, $.11 for the

10 1999 crop, $.09 for the 2000 crop, $.09

11 for the 2001 crop, and $.10 for the

12 2002 crop; and

13 ‘‘(IV) in the case of barley, $.45

14 for the 1996 crop, $.43 for the 1997

15 crop, $.44 for the 1998 crop, $.42 for

16 the 1999 crop, $.39 for the 2000 crop,

17 $.39 for the 2001 crop, and $.40 for the

18 2002 crop.’’; and

19 (iv) in clause (iv) (as so redesignated),

20 by striking ‘‘1995’’ each place it appears

21 and inserting ‘‘2002’’;

22 (C) in subparagraph (C)—

23 (i) in clause (i)—
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1 (I) by inserting after ‘‘crop’’ the

2 following: ‘‘or to a commodity per3 mitted under section 504(b)’’; and

4 (II) by striking ‘‘within the per5 mitted acreage’’; and

6 (ii) in clause (ii)—

7 (I) by striking ‘‘85 percent’’ and

8 inserting ‘‘70 percent’’; and

9 (II) by striking ‘‘less the quan10 tity’’ and all that follows through

11 ‘‘(e)(2)(D))’’;

12 (D) in subparagraph (D)(i), by striking

13 ‘‘Notwithstanding the foregoing provisions of this

14 section, if’’ and inserting ‘‘If’’; and

15 (E) in subparagraph (E)—

16 (i) in clause (i)—

17 (I) by striking ‘‘an acreage’’ and

18 all that follows through ‘‘grains and’’;

19 (II) by striking ‘‘1997 crops (ex20 cept as provided in clause (vii))’’ each

21 place it appears and inserting ‘‘2002

22 crops’’;

23 (III) by striking ‘‘(except as pro24 vided in subparagraph (F))’’ each

25 place it appears and inserting ‘‘or al-
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1 ternative crops described in subpara2 graph (F)’’; and

3 (IV) in subclause (I), by striking

4 ‘‘for the purpose’’ and all that follows

5 through ‘‘(e)(2)(D)’’;

6 (ii) in clause (ii), by striking ‘‘(or

7 other uses as provided in subparagraph

8 (F))’’ and inserting ‘‘or alternative crops

9 described in subparagraph (F)’’;

10 (iii) in clause (iv), by striking ‘‘per11 mitted feed grain’’ and all that follows

12 through ‘‘this subparagraph’’ and inserting

13 ‘‘feed grain payment acres of the farm was

14 devoted to conserving uses or alternative

15 crops described in subparagraph (F)’’;

16 (iv) by striking clause (vi);

17 (v) by redesignating clause (vii) as

18 clause (vi); and

19 (vi) in clause (vi) (as so redesig20 nated)—

21 (I) in the clause heading, by strik22 ing ‘‘EXCEPTIONS TO 0/85’’ and insert23 ing ‘‘REDUCED YIELDS’’;

24 (II) by striking ‘‘an acreage’’ and

25 all that follows through ‘‘crop and’’;
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1 (III) by striking subclause (II);

2 (IV) in subclause (I)(aa)—

3 (aa) by striking ‘‘(aa)’’; and

4 (bb) by striking ‘‘be pre5 vented from planting the crop or’’;

6 and

7 (V) in subclause (I)(bb)—

8 (aa) by striking ‘‘(bb)’’ and

9 inserting ‘‘(II)’’;

10 (bb) by striking ‘‘8 percent’’

11 and inserting ‘‘15 percent’’; and

12 (cc) by striking ‘‘; or’’ and

13 inserting a period;

14 (5) by striking subsection (e) and inserting the

15 following:

16 ‘‘(e) HAYING AND GRAZING.—

17 ‘‘(1) IN GENERAL.—Except as provided in para18 graph (2), haying and grazing of acreage under sub19 section (c)(1)(C) shall be permitted, except during

20 any consecutive 5-month period that is established by

21 the State committee established under section 8(b) of

22 the Soil Conservation and Domestic Allotment Act

23 (16 U.S.C. 590h(b)) for a State. The 5-month period

24 shall be established during the period beginning April

25 1, and ending October 31, of a year.
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1 ‘‘(2) NATURAL DISASTERS.—In the case of a nat2 ural disaster, the Secretary may permit unlimited

3 haying and grazing on the acreage. The Secretary

4 may not exclude irrigated or irrigable acreage not

5 planted to alfalfa when exercising the authority under

6 this paragraph.’’;

7 (6) in subsection (f)—

8 (A) in paragraph (1), by striking ‘‘1995’’

9 and inserting ‘‘2002’’; and

10 (B) in paragraph (4)(C), by striking ‘‘re11 duced by’’ and all that follows through ‘‘sub12 section (e)’’;

13 (7) in subsection (g)(1), by striking ‘‘under sub14 section (e)’’;

15 (8) in subsection (o)(1), by striking ‘‘and acreage

16 reduction’’;

17 (9) in subsection (p)(1), by striking ‘‘1995’’ and

18 inserting ‘‘2002’’;

19 (10) in subsection (q)(1)—

20 (A) by striking ‘‘1995’’ and inserting

21 ‘‘2002’’;

22 (B) in subparagraph (C), by inserting

23 ‘‘and’’ after the semicolon at the end;

24 (C) in subparagraph (D), by striking ‘‘;

25 and’’ and inserting a period; and
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1 (D) by striking subparagraph (E); and

2 (11) in subsection (r), by striking ‘‘1995’’ and

3 inserting ‘‘2002’’.

4 SEC. 1105. WHEAT PROGRAM.

5 Section 305 of the Agricultural Act of 1949 (as redesig6 nated by section 1101(b)(1)(B)) is amended—

7 (1) by striking the section heading and inserting

8 the following:

9 ‘‘SEC. 305. LOANS AND PAYMENTS FOR THE 1991 THROUGH

10 2002 CROPS OF WHEAT.’’;

11 (2) in subsection (a)—

12 (A) in paragraph (1), by striking ‘‘1995’’

13 and inserting ‘‘2002’’; and

14 (B) in paragraph (4)—

15 (i) in subparagraph (A)—

16 (I) by striking ‘‘may’’ and insert17 ing ‘‘shall’’;

18 (II) in clause (i), by inserting

19 ‘‘or’’ after the semicolon; and

20 (III) in clause (iii), by striking

21 ‘‘(iii) the’’ and inserting the following:

22 ‘‘(III) the’’; and

23 (ii) in subparagraph (C), by striking

24 ‘‘1995’’ and inserting ‘‘2002’’;
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1 (3) in subsection (b)(1), by striking ‘‘1995’’ and

2 inserting ‘‘2002’’;

3 (4) in subsection (c)(1)—

4 (A) in subparagraph (A), by striking

5 ‘‘1995’’ and inserting ‘‘2002’’;

6 (B) in subparagraph (B)—

7 (i) in clause (ii)—

8 (I) in the clause heading, by strik9 ing ‘‘AND 1995’’ and inserting

10 ‘‘THROUGH 2002’’; and

11 (II) by striking ‘‘and 1995’’ and

12 inserting ‘‘through 2002’’;

13 (ii) by redesignating clause (iii) as

14 clause (iv);

15 (iii) by inserting after clause (ii) the

16 following:

17 ‘‘(iii) MAXIMUM PAYMENT RATE.—The

18 payment rate for wheat under this sub19 section shall not exceed (per bushel) $.89 for

20 the 1996 crop, $.94 for the 1997 crop, $.95

21 for the 1998 crop, $.89 for the 1999 crop,

22 $.79 for the 2000 crop, $.78 for the 2001

23 crop, and $.71 for the 2002 crop.’’; and

24 (iv) in clause (iv) (as so redesignated),

25 by striking ‘‘1995’’ and inserting ‘‘2002’’;
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1 (C) in subparagraph (C)—

2 (i) in clause (i)—

3 (I) by inserting after ‘‘crop’’ the

4 following: ‘‘or to a commodity per5 mitted under section 504(b)’’; and

6 (II) by striking ‘‘within the per7 mitted acreage’’; and

8 (ii) in clause (ii)—

9 (I) by striking ‘‘85 percent’’ and

10 inserting ‘‘70 percent’’; and

11 (II) by striking ‘‘less the quan12 tity’’ and all that follows through

13 ‘‘(e)(2)(D))’’;

14 (D) in subparagraph (D)(i), by striking

15 ‘‘Notwithstanding the foregoing provisions of this

16 section, if’’ and inserting ‘‘If’’; and

17 (E) in subparagraph (E)—

18 (i) in clause (i)—

19 (I) by striking ‘‘an acreage’’ and

20 all that follows through ‘‘wheat and’’;

21 (II) by striking ‘‘1997 crops (ex22 cept as provided in clause (vii))’’ each

23 place it appears and inserting ‘‘2002

24 crops’’;
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1 (III) by striking ‘‘(except as pro2 vided in subparagraph (F))’’ each

3 place it appears and inserting ‘‘or al4 ternative crops described in subpara5 graph (F)’’; and

6 (IV) in subclause (I), by striking

7 ‘‘for the purpose’’ and all that follows

8 through ‘‘(e)(2)(D)’’;

9 (ii) in clause (ii), by striking ‘‘(or

10 other uses as provided in subparagraph

11 (F))’’ and inserting ‘‘or alternative crops

12 described in subparagraph (F)’’;

13 (iii) in clause (iv), by striking ‘‘per14 mitted wheat’’ and all that follows through

15 ‘‘this subparagraph’’ and inserting ‘‘wheat

16 grain payment acres of the farm was de17 voted to conserving uses or alternative crops

18 described in subparagraph (F)’’;

19 (iv) by striking clause (vi);

20 (v) by redesignating clause (vii) as

21 clause (vi); and

22 (vi) in clause (vi) (as so redesig23 nated)—
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1 (I) in the clause heading, by strik2 ing ‘‘EXCEPTIONS TO 0/85’’ and insert3 ing ‘‘REDUCED YIELDS’’;

4 (II) by striking ‘‘an acreage’’ and

5 all that follows through ‘‘crop and’’;

6 (III) by striking subclause (II);

7 (IV) in subclause (I)(aa)—

8 (aa) by striking ‘‘(aa)’’; and

9 (bb) by striking ‘‘be pre10 vented from planting the crop or’’;

11 and

12 (V) in subclause (I)(bb)—

13 (aa) by striking ‘‘(bb)’’ and

14 inserting ‘‘(II)’’;

15 (bb) by striking ‘‘8 percent’’

16 and inserting ‘‘15 percent’’; and

17 (cc) by striking ‘‘; or’’ and

18 inserting a period;

19 (5) by striking subsection (e) and inserting the

20 following:

21 ‘‘(e) HAYING AND GRAZING.—

22 ‘‘(1) IN GENERAL.—Except as provided in para23 graph (2), haying and grazing of acreage under sub24 section (c)(1)(C) shall be permitted, except during

25 any consecutive 5-month period that is established by
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1 the State committee established under section 8(b) of

2 the Soil Conservation and Domestic Allotment Act

3 (16 U.S.C. 590h(b)) for a State. The 5-month period

4 shall be established during the period beginning April

5 1, and ending October 31, of a year.

6 ‘‘(2) NATURAL DISASTERS.—In the case of a nat7 ural disaster, the Secretary may permit unlimited

8 haying and grazing on the acreage. The Secretary

9 may not exclude irrigated or irrigable acreage not

10 planted to alfalfa when exercising the authority under

11 this paragraph.’’;

12 (6) in subsection (f)—

13 (A) in paragraph (1), by striking ‘‘1995’’

14 and inserting ‘‘2002’’; and

15 (B) in paragraph (4)(C), by striking ‘‘re16 duced by’’ and all that follows through ‘‘sub17 section (e)’’;

18 (7) in subsection (g)(1), by striking ‘‘under sub19 section (e)’’;

20 (8) in subsection (o)(1), by striking ‘‘and acreage

21 reduction’’;

22 (9) in subsection (p)(2)(B), by striking ‘‘less the

23 quantity’’ and all that follows through ‘‘(e)(2)(D))’’;

24 and
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1 (10) in subsection (q), by striking ‘‘1995’’ and

2 inserting ‘‘2002’’.

3 SEC. 1106. MILK PROGRAM.

4 (a) IN GENERAL.—Section 204 of the Agricultural Act

5 of 1949 (7 U.S.C. 1446e) is amended to read as follows:

6 ‘‘SEC. 204. MILK PRICE SUPPORT PROGRAM FOR CALENDAR

7 YEARS 1996 THROUGH 2002.

8 ‘‘(a) IN GENERAL.—During the period beginning Jan9 uary 1, 1996, and ending December 31, 2002, the price of

10 milk produced in the 48 contiguous States shall be sup11 ported as provided in this section.

12 ‘‘(b) SUPPORT PRICE.—

13 ‘‘(1) IN GENERAL.—During the period referred to

14 in subsection (a), the price of milk used for cheese

15 shall be supported at a rate equal to $10.00 per hun16 dredweight for calendar year 1996, subject to sub17 section (d). Milk used for nonfat dry milk or butter

18 shall not be supported under this section.

19 ‘‘(2) ANNUAL REDUCTION.—For each of calendar

20 years 1997 through 2002, the Secretary shall reduce

21 the rate of price support for milk used for cheese by

22 10 cents per hundredweight.

23 ‘‘(c) PURCHASES.—

24 ‘‘(1) IN GENERAL.—The price of milk used for

25 cheese shall be supported through the purchase of
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1 cheese and based on the support price in effect during

2 the applicable calendar year.

3 ‘‘(2) SALES THROUGH DEIP.—All sales for export

4 under the dairy export incentive program established

5 under section 153 of the Food Security Act of 1985

6 (15 U.S.C. 713a–14) shall be considered as total pur7 chases under subsection (d).

8 ‘‘(d) SUPPORT RATE ADJUSTMENTS.—Effective Janu9 ary 1 of each of the calendar years 1996 through 2002, if

10 the level of purchases of milk and the products of milk by

11 the Commodity Credit Corporation under this section (less

12 sales under section 407 for unrestricted use), through direct

13 purchases or through sales under the dairy export incentive

14 program established under section 153 of the Food Security

15 Act of 1985 (15 U.S.C. 713a–14), as estimated by the Sec16 retary by November 20 of the preceding calendar year, will

17 exceed 1,500,000,000 pounds (milk equivalent, total milk

18 solids basis), the Secretary shall decrease by 25 cents per

19 hundredweight, in addition to the annual reduction under

20 subsection (b)(2), the rate of price support for milk used

21 for cheese in effect for the calendar year. The support rate

22 adjustment provided under this subsection shall be effective

23 only for the calendar year applicable to the estimate of the

24 Secretary. After the support rate adjustment terminates, the
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1 support price shall be the level provided under subsection

2 (b)(2).

3 ‘‘(e) COMMODITY CREDIT CORPORATION.—The Sec4 retary shall carry out the program authorized by this sec5 tion through the Commodity Credit Corporation.

6 ‘‘(f) PERIOD.—This section shall be effective only dur7 ing the period beginning January 1, 1996, and ending De8 cember 31, 2002.’’.

9 (b) MILK MANUFACTURING MARKETING ADJUST10 MENT.—Section 102 of the Food, Agriculture, Conservation,

11 and Trade Act of 1990 (7 U.S.C. 1446e–1) is repealed.

12 (c) CLASS IV ACCOUNT.—Effective January 1, 1996,

13 section 8c(5) of the Agricultural Adjustment Act (7 U.S.C.

14 608c(5)), reenacted with amendments by the Agricultural

15 Marketing Agreement Act of 1937, is amended—

16 (1) in paragraph (A), by adding at the end the

17 following: ‘‘Each marketing order issued pursuant to

18 this section for milk and milk products shall include

19 all skim milk and butterfat used to produce butter,

20 nonfat dry milk, and dry whole milk as part of a

21 Class IV classification.’’; and

22 (2) by adding at the end the following:

23 ‘‘(M) CLASS IV ACCOUNT.—

24 ‘‘(i) DEFINITIONS.—In this paragraph:
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1 ‘‘(I) ACCOUNT.—The term ‘Ac2 count’ means the Account for Class IV

3 final products established under clause

4 (ii).

5 ‘‘(II) ADMINISTRATOR.—The term

6 ‘Administrator’ means the Adminis7 trator of the Account appointed under

8 clause (vii).

9 ‘‘(III) CLASS IV FINAL PROD10 UCT.—The term ‘Class IV final prod11 uct’ means butter, nonfat dry milk,

12 and dry whole milk.

13 ‘‘(IV) MILK MARKETING ORDER.—

14 The term ‘milk marketing order’ means

15 a milk marketing order issued pursu16 ant to this section and any comparable

17 State milk marketing order or system.

18 ‘‘(ii) ESTABLISHMENT OF ACCOUNT.—

19 Notwithstanding any other provision of law,

20 the Secretary shall establish an Account for

21 Class IV final products to equalize returns

22 from all milk used in the 48 contiguous

23 States to produce Class IV final products

24 among all milk marketed by producers for

25 commercial use.
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1 ‘‘(iii) CLASS IV PRICE AND DIFFEREN2 TIAL; PRORATION.—

3 ‘‘(I) PRICE.—The Secretary shall

4 determine a milk equivalent value per

5 hundredweight for Class IV final prod6 ucts each month based on the average

7 wholesale market prices during the

8 month for Class IV final products. The

9 milk equivalent value at 3.67 percent

10 milkfat shall be the per hundredweight

11 Class IV price under the Account.

12 ‘‘(II) DIFFERENTIAL.—The Ad13 ministrator of the Account shall an14 nounce, on the first business day of

15 each month, the per hundredweight

16 Class IV differential applicable to the

17 preceding month. The monthly Class

18 IV differential shall be the amount, if

19 any, by which the support rate for

20 milk in effect under section 204 of the

21 Agricultural Act of 1949 (7 U.S.C.

22 1446e) exceeds the Class IV price estab23 lished pursuant to subclause (I).

24 ‘‘(III) PRORATION.—On or before

25 the twentieth day after the end of each
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1 month, the Administrator of the Ac2 count shall—

3 ‘‘(aa) determine the quantity

4 of milk produced in the 48 contig5 uous States of the United States

6 and marketed for commercial use

7 in producing Class IV final prod8 ucts during the preceding month;

9 ‘‘(bb) calculate the quantity

10 equal to the number of

11 hundredweights of milk used for

12 Class IV final products during the

13 preceding month (as determined

14 under item (aa)) multiplied by

15 the Class IV differential for the

16 month established under subclause

17 (II), and add to that amount the

18 cost of administering the Account

19 during the current month; and

20 ‘‘(cc) prorate the amount es21 tablished under item (bb) among

22 the total amount, in

23 hundredweights, of milk produced

24 in the 48 contiguous States and
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1 marketed for commercial use dur2 ing the preceding month.

3 ‘‘(iv) ACCOUNT OBLIGATIONS.—On or

4 before the twenty-fifth day after the end of

5 each month:

6 ‘‘(I) Each person making pay7 ment to a producer for milk produced

8 in any of the 48 contiguous States of

9 the United States and marketed for

10 commercial use shall collect from each

11 producer the amount determined by

12 multiplying the quantity of milk han13 dled for the account of the producer

14 during the preceding month by the

15 Class IV differential proration estab16 lished pursuant to clause

17 (iii)(III)(ccc). The amount shall be re18 mitted to the Administrator of the Ac19 count.

20 ‘‘(II) Any producer marketing

21 milk of the producer’s own production

22 in the form of milk or dairy products

23 to consumers, either directly or through

24 retail or wholesale outlets, shall remit

25 to the Administrator of the Account the
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1 amount determined by multiplying the

2 quantity of the milk marketed by the

3 producer by the Class IV differential

4 proration established under clause

5 (iii)(III)(ccc).

6 ‘‘(v) DISTRIBUTION OF ACCOUNT PRO7 CEEDS.—On or before the thirtieth day after

8 the end of each month, the Administrator of

9 the Account shall pay to each person that

10 used skim milk and butterfat to produce

11 Class IV final products during the preced12 ing month a proportionate share of the total

13 Account proceeds for the month. The propor14 tion of the total proceeds payable to each

15 person shall be the same proportion that the

16 skim milk and butterfat used by the person

17 to produce Class IV final products during

18 the preceding month is of the total skim

19 milk and butterfat used by all persons dur20 ing the preceding month to produce Class

21 IV final products.

22 ‘‘(vi) EFFECT ON BLEND PRICES.—

23 Producer blend prices under a milk market24 ing order shall be adjusted to account for
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1 revenue distributions required under clauses

2 (iv) and (v).

3 ‘‘(vii) ADMINISTRATION OF CLASS IV

4 ACCOUNT.—The Secretary shall appoint a

5 person to serve as the Administrator of the

6 Account and shall delegate to the Adminis7 trator such powers as are needed to carry

8 out the duties of Administrator.

9 ‘‘(viii) ENFORCEMENT.—

10 ‘‘(I) COLLECTION.—The amounts

11 specified in clause (iv) shall be col12 lected and remitted to the Adminis13 trator in the manner prescribed by the

14 Secretary.

15 ‘‘(II) PENALTIES.—If any person

16 fails to remit the amounts required

17 under clause (iv) or fails to comply

18 with such requirements for record19 keeping or otherwise as are required by

20 the Secretary to carry out this sub21 paragraph, the person shall be liable to

22 the Secretary for a civil penalty up to,

23 as determined by the Secretary, an

24 amount determined by multiplying—
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1 ‘‘(i) the quantity of milk in2 volved in the violation; by

3 ‘‘(ii) the support rate for

4 milk in effect under section 204 of

5 the Agricultural Act of 1949 (7

6 U.S.C. 1446e) for the applicable

7 calendar year.

8 ‘‘(III) ENFORCEMENT.—The Sec9 retary may enforce this clause in the

10 courts of the United States.

11 ‘‘(ix) REGULATIONS.—The Secretary

12 shall issue regulations to establish the Ac13 count without regard to the notice and com14 ment requirements of section 553 of title 5,

15 United States Code.’’.

16 (d) NORTHEAST INTERSTATE DAIRY COMPACT.—Con17 gress consents to the Northeast Interstate Dairy Compact

18 entered into among the States of Vermont, New Hampshire,

19 Maine, Connecticut, Rhode Island, and Massachusetts, sub20 ject to the following conditions:

21 (1) COMPENSATION OF CCC.—Before the end of

22 each fiscal year that a Compact price regulation is in

23 effect, the Compact Commission shall compensate the

24 Commodity Credit Corporation for the cost of any

25 purchases of milk and milk products by the Corpora-
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1 tion that result from projected fluid milk production

2 for the fiscal year within the Compact region in ex3 cess of the national average rate of purchases of milk

4 and milk products by the Corporation.

5 (2) MILK MARKET ORDER ADMINISTRATOR.—By

6 agreement among the States and the Secretary of Ag7 riculture, the Administrator shall provide technical

8 assistance to the compact Commission, and be reim9 bursed for the assistance, with respect to the applica10 ble milk marketing order issued under section 8c(5) of

11 the Agricultural Adjustment Act (7 U.S.C. 608c(5)),

12 reenacted with amendments by the Agricultural Mar13 keting Agreement Act of 1937.

14 (3) TERMINATION AND RENEWAL.—The consent

15 for the Compact shall—

16 (A) terminate on the date that is 7 years

17 after the date of enactment of this Act, subject to

18 subparagraph (B); and

19 (B) may be renewed by Congress, without

20 prior ratification by the States’ legislatures.

21 (e) AGRICULTURAL COMPETITIVENESS GRANTS.—The

22 Secretary of Agriculture (referred to in this subtitle as the

23 ‘‘Secretary’’) shall, in accordance with this subtitle, award

24 a grant to a grantee eligible under section 1502 to promote

25 a purpose of this subtitle.
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1 (f) ELIGIBLE GRANTEE.—The Secretary may make a

2 grant under section 1501 to—

3 (1) a college or university;

4 (2) a State agricultural experiment station;

5 (3) a State Cooperative Extension Service;

6 (4) a research institution or organization;

7 (5) a private organization or person; or

8 (6) a Federal agency.

9 (g) USE OF GRANT.—A grant made under section 1501

10 may be used by a grantee for 1 or more of the following

11 uses:

12 (1) Research, ranging from discovery to prin13 ciples of application.

14 (2) Extension and related private-sector activi15 ties.

16 (3) Education.

17 (h) PRIORITY.—In administering this subtitle, the Sec18 retary shall—

19 (1) establish priorities for allocating grants,

20 based on needs and opportunities of the food and ag21 riculture system in the United States;

22 (2) seek and accept proposals for grants;

23 (3) determine the relevance and merit of propos24 als through a system of peer review; and
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1 (4) award grants on the basis of merit and qual2 ity.

3 (i) ADMINISTRATION.—

4 (1) COMPETITIVE GRANT.—A grant under section

5 1501 shall be awarded on a competitive basis.

6 (2) TERM.—A grant under section 1501 shall

7 have a term that does not exceed 5 years.

8 (3) MATCHING FUNDS.—As a condition of receipt

9 of a grant under section 1501, the Secretary shall re10 quire the funding of the grant with equal matching

11 funds from a non-Federal source if the grant is—

12 (A) for applied research that is commodity13 specific; and

14 (B) not of national scope.

15 (4) ADMINISTRATIVE COSTS.—The Secretary

16 may use not more than 4 percent of the funds made

17 available under section 1506 for administrative costs

18 incurred by the Secretary in carrying out this sub19 title.

20 (5) CONSTRUCTION COSTS.—None of the funds

21 made available under section 1507 may be used for

22 the construction of a new building or the acquisition,

23 expansion, remodeling, or alteration of an existing

24 building (including site grading and improvement

25 and architect fees).
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1 (j) REGULATIONS.—The Secretary shall issue such reg2 ulations as are necessary to carry out this subtitle.

3 (k) USE OF COMMODITY CREDIT CORPORATION

4 FUNDS.—

5 (1) IN GENERAL.—Subject to subsection (b), the

6 Secretary shall use $30,000,000 of the funds of the

7 Commodity Credit Corporation for each of fiscal

8 years 1996 through 2002 to carry out this title.

9 (2) LIMITATION.—The Secretary may use less

10 than $30,000,000 of the funds of the Commodity

11 Credit Corporation for any fiscal year if the Sec12 retary determines that the full funding level is not

13 necessary to fund all qualifying applications for agri14 cultural competitiveness grants that satisfy the prior15 ity criteria established under section 1504.

16 (3) POWERS OF THE CORPORATION.—Section 5

17 of the Commodity Credit Corporation Charter Act (15

18 U.S.C. 714c) (as amended by section 1201(c)(1)) is

19 amended by inserting after subsection (g) the follow20 ing:

21 ‘‘(h) Carry out research, extension, and education re22 lated to agriculture by using not more than $30,000,000

23 of the funds of the Corporation in any fiscal year for any

24 function or activity relating to agricultural research, exten25 sion, or education.’’.
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1 (l) EFFECTIVE DATE.—This subtitle and the amend2 ment made by this subtitle shall become effective upon en3 actment.

4 SEC. 1107. OILSEEDS PROGRAM.

5 Section 205 of the Agricultural Act of 1949 (7 U.S.C.

6 1446f) is amended—

7 (1) in the section heading, by striking ‘‘1995’’

8 and inserting ‘‘2002’’;

9 (2) in subsections (b), (c), (e)(1), and (n), by

10 striking ‘‘1995’’ each place it appears and inserting

11 ‘‘2002’’; and

12 (3) in subsections (c) and (h)(2), by striking

13 ‘‘1997’’ each places it appears and inserting ‘‘2002’’.

14 SEC. 1108. SUGAR PROGRAM.

15 (a) IN GENERAL.—Section 206 of the Agricultural Act

16 of 1949 (7 U.S.C. 1446g) is amended—

17 (1) in the section heading, by striking ‘‘1997’’

18 and inserting ‘‘2002’’;

19 (2) in subsection (a), by striking ‘‘1997’’ and in20 serting ‘‘2002’’;

21 (3) in subsection (b), by striking ‘‘nonrecourse’’;

22 (4) in subsection (c)—

23 (A) by striking ‘‘1997’’ and inserting

24 ‘‘2002’’; and

25 (B) by striking ‘‘nonrecourse’’;
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1 (5) by redesignating subsections (d) through (j)

2 as subsections (f) through (l), respectively;

3 (6) by inserting after subsection (c) the follow4 ing:

5 ‘‘(d) LOANS.—

6 ‘‘(1) IN GENERAL.—Subject to paragraph (2), the

7 Secretary shall carry out this section through the use

8 of recourse loans.

9 ‘‘(2) IMPORT TRIGGER FOR NONRECOURSE

10 LOANS.—If in any fiscal year the tariff rate quota for

11 imports of sugar into the United States is established

12 at a level equal to 1,340,000 or more short tons, raw

13 value, the Secretary shall for the duration of the fiscal

14 year make available nonrecourse loans under this sec15 tion. A recourse loan made during the fiscal year

16 prior to the tariff rate quota being established at

17 1,340,000 or more short tons, raw value, under this

18 section shall be modified by the Secretary into a

19 nonrecourse loan for the remainder of the term of the

20 loan.

21 ‘‘(3) PROCESSOR ASSURANCES.—The Secretary

22 shall obtain from each processor that obtains either a

23 recourse or nonrecourse loan under this section such

24 assurances as the Secretary considers necessary to en25 sure that producers of sugarcane and sugar beets will
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1 receive payments that are proportional to the value of

2 the loan received by the processor, as determined by

3 the Secretary.

4 ‘‘(e) FORFEITURES.—A penalty shall be assessed on the

5 forfeiture of any sugar pledged as collateral for a

6 nonrecourse loan. The penalty for cane sugar shall be equiv7 alent to 1 cent per pound. The penalty for beet sugar shall

8 bear the same relation to the penalty for cane sugar as the

9 marketing assessment for sugar beets bears to the marketing

10 assessment for sugarcane.’’;

11 (7) in subsection (f)(1) (as so redesignated), by

12 striking ‘‘1997’’ and inserting ‘‘2002’’;

13 (8) in subsection (h) (as so redesignated), by

14 striking ‘‘subsection (g)’’ and inserting ‘‘subsection

15 (i)’’;

16 (9) in subsection (i) (as so redesignated)—

17 (A) in the subsection heading, by striking

18 ‘‘NONRECOURSE’’; and

19 (B) by striking ‘‘price support’’ each place

20 it appears;

21 (10) in subsection (k) (as so redesignated)—

22 (A) in the subsection heading, by striking

23 ‘‘MARKETING ASSESSMENT’’ and inserting ‘‘AS24 SESSMENTS ON ALL MARKETED SUGAR’’;

25 (B) in paragraph (1)—
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1 (i) by striking ‘‘1996’’ and inserting

2 ‘‘2002’’;

3 (ii) in subparagraph (A)—

4 (I) by striking ‘‘each of fiscal

5 years 1992 through 1994, 1.0’’ and in6 serting ‘‘fiscal year 1996, 1.1’’; and

7 (II) by striking ‘‘(but’’ and all

8 that follows through ‘‘sugar),’’; and

9 (iii) in subparagraph (B)—

10 (I) by striking ‘‘1995 through

11 1998, 1.1’’ and inserting ‘‘1997

12 through 2003, 1.375’’; and

13 (II) by striking ‘‘(but’’ and all

14 that follows through ‘‘sugar),’’; and

15 (C) in paragraph (2)—

16 (i) by striking ‘‘1996’’ and inserting

17 ‘‘2002’’;

18 (ii) in subparagraph (A)—

19 (I) by striking ‘‘each of fiscal

20 years 1992 through 1994, 1.0722’’ and

21 inserting ‘‘fiscal year 1996, 1.1794’’;

22 and

23 (II) by striking ‘‘(but’’ and all

24 that follows through ‘‘sugar),’’; and

25 (iii) in subparagraph (B)—
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1 (I) by striking ‘‘1995 through

2 1998, 1.1794’’ and inserting ‘‘1997

3 through 2003, 1.47425’’; and

4 (II) by striking ‘‘(but’’ and all

5 that follows through ‘‘sugar),’’; and

6 (D) by striking paragraph (6); and

7 (11) in subsection (l) (as so redesignated), by

8 striking ‘‘1997’’ and inserting ‘‘2002’’.

9 (b) LOAN PROVISIONS.—Section 401(e)(1) of the Agri10 cultural Act of 1949 (7 U.S.C. 1421(e)(1)) is amended by

11 adding at the end the following: ‘‘In the case of price sup12 port for sugarcane or sugar beets, the payment owed pro13 ducers by a processor shall be reduced in proportion to the

14 loan forfeiture penalty amounts incurred by the processor

15 as provided in section 206(e).’’.

16 (c) MARKETING ALLOTMENTS.—Part VII of subtitle B

17 of title III of the Agricultural Adjustment Act of 1938 (7

18 U.S.C. 1359aa et seq.) is repealed.

19 SEC. 1109. ACREAGE BASE AND YIELD SYSTEM.

20 Title V of the Agricultural Act of 1949 (7 U.S.C. 1461

21 et seq.) is amended—

22 (1) in section 503 (7 U.S.C. 1463)—

23 (A) in subsection (a)—
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1 (i) in paragraph (2), by adding ‘‘and

2 historical soybean acreage’’ after ‘‘crop acre3 age bases’’; and

4 (ii) by adding at the end the following:

5 ‘‘(4) HISTORICAL SOYBEAN ACREAGE.—

6 ‘‘(A) IN GENERAL.—The Secretary shall

7 provide for the establishment and maintenance of

8 an historical soybean acreage for each farm.

9 ‘‘(B) QUANTITY.—

10 ‘‘(i) IN GENERAL.—Except as provided

11 in clause (ii), the historical soybean acreage

12 for a farm for a crop year shall be equal to

13 the average of the acreage planted to soy14 beans for harvest on the farm in each of the

15 previous 5 crop years.

16 ‘‘(ii) EXCEPTION.—In determining the

17 historical soybean acreage for a farm for a

18 crop year, the Secretary shall exclude from

19 the acreage any soybean plantings that were

20 considered planted to a program crop or are

21 planted for harvest on a crop acreage

22 base.’’;

23 (B) in subsection (b)—

24 (i) by striking ‘‘CALCULATION.—’’ and

25 all that follows through ‘‘paragraph (2),
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1 the’’ in paragraph (1) and inserting ‘‘CAL2 CULATION.—The’’; and

3 (ii) by striking paragraph (2);

4 (C) in subsection (c)—

5 (i) in paragraph (1), by inserting ‘‘in

6 the case of each of the 1991 through 1995

7 crops,’’ after ‘‘(1)’’;

8 (ii) in paragraph (3), by striking

9 ‘‘1997’’ and inserting ‘‘1995’’;

10 (iii) in paragraph (4)—

11 (I) by inserting ‘‘in the case of the

12 1991 through 1995 crops, and base

13 acreage in the case of the 1996 through

14 2002 crops,’’ after ‘‘permitted acreage’’;

15 and

16 (II) by inserting ‘‘or conservation

17 uses or related commodity production

18 permitted by the Secretary’’ after ‘‘sec19 tion 504’’; and

20 (iv) in paragraph (6), by inserting ‘‘in

21 the case of each of the 1991 through 1995

22 crops,’’ after ‘‘(6)’’; and

23 (D) by striking subsection (h);

24 (2) in section 504 (7 U.S.C. 1464)—

25 (A) in subsection (b)—
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1 (i) in paragraph (1)—

2 (I) in the paragraph heading, by

3 striking ‘‘PERMITTED CROPS’’ and in4 serting ‘‘PAYMENT ACRES’’;

5 (II) by striking ‘‘for purposes of

6 this section,’’;

7 (III) by striking ‘‘a crop acreage

8 base’’ and inserting ‘‘the payment

9 acres of a crop acreage base’’;

10 (IV) in subparagraph (D), by

11 striking ‘‘and’’ at the end;

12 (V) in subparagraph (E), by

13 striking the period at the end and in14 serting ‘‘; and’’; and

15 (VI) by adding at the end the fol16 lowing:

17 ‘‘(F) peas and lentils.’’; and

18 (ii) by adding at the end the following:

19 ‘‘(4) CROP ACREAGE BASE NOT ELIGIBLE FOR

20 PAYMENT.—Any crop or conserving crop that is

21 planted on the acres of a crop acreage base that are

22 not eligible for payments shall be eligible for loans.

23 Haying and grazing on the acres shall not be re24 stricted.’’;
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1 (B) by striking subsection (c) and inserting

2 the following:

3 ‘‘(c) LIMITATIONS ON ACREAGE AND PAYMENTS.—

4 ‘‘(1) IN GENERAL.—Except as otherwise provided

5 in this section, the planting of a program crop may

6 exceed 100 percent of the crop acreage base of the pro7 gram crop. The program crop shall be eligible for

8 loans.

9 ‘‘(2) UPLAND COTTON AND RICE.—In the case of

10 upland cotton and rice, any crop other than upland

11 cotton or rice that is planted on an upland cotton or

12 rice crop acreage base shall not be eligible for pay13 ments.

14 ‘‘(3) WHEAT AND FEED GRAINS.—In the case of

15 wheat and feed grains, except as provided in para16 graph (4), any crop planted on a wheat or feed grain

17 crop acreage base shall be eligible for payments that

18 are attributable to the payment acres of the wheat or

19 feed grain crop acreage base.

20 ‘‘(4) EXCEPTIONS.—

21 ‘‘(A) PAYMENTS ON MULTIPLE CROP ACRE22 AGE BASES.—Producers on a farm with wheat or

23 feed grain crop acreage base and upland cotton

24 or rice crop acreage base may not receive pay25 ments with respect to the rice or upland cotton
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1 planted on the wheat or feed grain crop acreage

2 base.

3 ‘‘(B) UPLAND COTTON OR RICE PAY4 MENTS.—Upland cotton or rice shall not be eligi5 ble for payments if planted in excess of the re6 spective crop acreage base, except that—

7 ‘‘(i) upland cotton or rice planted on

8 acreage not eligible for payments under sub9 section (b)(4) shall not affect the eligibility

10 for payments under this subparagraph, but

11 shall be eligible for loans; and

12 ‘‘(ii) acreage described in subsection

13 (e)(1) shall be eligible for loans, but not for

14 payments.’’;

15 (C) by striking subsection (d);

16 (D) by redesignating subsection (e) as sub17 section (d);

18 (E) in subsection (d)(2) (as so redesig19 nated)—

20 (i) by striking ‘‘the producers—’’ and

21 all that follows through ‘‘(A) plant’’ and in22 serting ‘‘the producers plant’’;

23 (ii) by striking ‘‘25 percent’’ and in24 serting ‘‘100 percent’’; and
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1 (iii) by striking ‘‘crop; and’’ all that

2 follows through the period at the end and

3 inserting ‘‘crop.’’; and

4 (F) by adding at the end the following:

5 ‘‘(e) TWO-WAY FLEXIBILITY.—Producers of a crop of

6 upland cotton or rice on a farm who are participating in

7 the annual program for upland cotton or rice may plant

8 the crop without losing eligibility for loans with respect to

9 the crop if the acreage planted to the crop on the farm does

10 not exceed the sum of—

11 ‘‘(1) 25 percent of the historical soybean acreage

12 on the farm; and

13 ‘‘(2) 100 percent of the crop acreage base.’’;

14 (3) in section 505 (7 U.S.C. 1465)—

15 (A) in subsection (a), by striking ‘‘or (c)’’;

16 (B) in subsection (b)—

17 (i) in paragraph (1)—

18 (I) by striking ‘‘paragraphs (2)

19 and (3)’’ and inserting ‘‘paragraph

20 (2)’’; and

21 (II) by striking ‘‘1997’’ and in22 serting ‘‘2002’’;

23 (ii) in paragraph (2), by striking

24 ‘‘1997’’ and inserting ‘‘2002’’; and
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1 (iii) by striking paragraphs (3), (4),

2 and (5); and

3 (C) by striking subsections (c), (d), and (e);

4 and

5 (4) in section 509 (7 U.S.C. 1469), by striking

6 ‘‘1997’’ and inserting ‘‘2002’’.

7 SEC. 1110. EXTENSION OF RELATED PRICE SUPPORT PROVI8 SIONS.

9 Title X of the Food Security Act of 1985 (Public Law

10 99–198; 99 Stat. 1444) is amended—

11 (1) in section 1001 (7 U.S.C. 1308), by striking

12 ‘‘1997’’ each place it appears in paragraphs (1)(A),

13 (1)(B), and (2)(A) and inserting ‘‘2002’’; and

14 (2) in section 1001C(a) (7 U.S.C. 1308–3(a)), by

15 striking ‘‘1997’’ each place it appears and inserting

16 ‘‘2002’’.

17 SEC. 1111. REPEAL OF MISCELLANEOUS AUTHORITIES.

18 (a) AGRICULTURAL ADJUSTMENT ACT OF 1938.—Title

19 III of the Agricultural Adjustment Act of 1938 is amend20 ed—

21 (1) in subtitle B—

22 (A) by striking parts II through V (7

23 U.S.C. 1326 et seq.); and
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1 (B) in part VI, by striking sections 358,

2 358a, and 358d (7 U.S.C. 1358, 1358a, and

3 1359); and

4 (2) by striking subtitle D (7 U.S.C. 1379a et

5 seq.).

6 (b) TREE ASSISTANCE PROGRAM.—The Secretary of

7 Agriculture shall terminate the tree assistance program es8 tablished under part 1478 of title 7, Code of Federal Regula9 tions.

10 SEC. 1112. COMMODITY CREDIT CORPORATION INTEREST

11 RATE.

12 Notwithstanding any other provision of law, the

13 monthly Commodity Credit Corporation interest rate appli14 cable to loans provided for agricultural commodities by the

15 Corporation shall be 100 basis points greater than the rate

16 determined under the applicable interest rate formula in

17 effect on October 1, 1995.

18 SEC. 1113. PEANUT PROGRAM.

19 (a) PRICE SUPPORT.—Section 108B of the Agricul20 tural Act of 1949 (7 U.S.C. 1445c–3) is amended—

21 (1) in the section heading, by striking ‘‘1997’’

22 and inserting ‘‘2000’’;

23 (2) in subsection (a)—

24 (A) in paragraph (1), by striking ‘‘1997’’

25 and inserting ‘‘2000’’; and
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1 (B) by striking paragraph (2) and inserting

2 the following:

3 ‘‘(2) SUPPORT RATE.—The national average

4 quota support rate for each of the 1996 through 2000

5 crops of quota peanuts shall be $628 per ton.’’;

6 (3) in subsection (b)(1), by striking ‘‘1997’’ and

7 inserting ‘‘2000’’;

8 (4) in the first sentence of subsection (c)(2)(A),

9 by inserting before the period at the end the following:

10 ‘‘and that, in the case of the 1996 and subsequent

11 crops, Valencia peanuts not produced in the State

12 shall not be eligible to participate in the pools of the

13 State’’;

14 (5) in subsection (g)—

15 (A) in paragraphs (1) and (2)(A)(ii)(II), by

16 striking ‘‘1997 crops’’ each place it appears and

17 inserting ‘‘2000 crops’’; and

18 (B) by striking ‘‘the 1997 crop’’ each place

19 it appears and inserting ‘‘each of the 1997

20 through 2000 crops’’; and

21 (6) in subsection (h), by striking ‘‘1997’’ and in22 serting ‘‘2000’’.

23 (b) POUNDAGE QUOTAS.—Section 358–1 of the Agri24 cultural Adjustment Act of 1938 (7 U.S.C. 1358–1) is

25 amended—
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1 (1) in the section heading, by striking ‘‘1997’’

2 and inserting ‘‘2000’’;

3 (2) in subsection (a)—

4 (A) by redesignating paragraphs (2) and

5 (3) as paragraphs (3) and (4), respectively;

6 (B) by striking paragraph (1) and inserting

7 the following:

8 ‘‘(1) ESTABLISHMENT.—The Secretary shall es9 tablish the national poundage quota for peanuts for

10 each of the 1991 through 2000 marketing years.

11 ‘‘(2) LEVEL.—The Secretary shall establish the

12 national poundage quota at a level that is equal to

13 the quantity of peanuts (in tons) that the Secretary

14 estimates will be devoted in each marketing year to

15 domestic edible and related uses, excluding seed, plus

16 a reasonable quantity of peanuts for carryover to en17 sure continuity of supply between marketing years.

18 Undermarketings of quota peanuts from the previous

19 year shall not be considered. In establishing the quota,

20 the Secretary shall take into account—

21 ‘‘(A) any stocks of peanuts on hand in the

22 inventory of the Commodity Credit Corporation;

23 and

24 ‘‘(B) peanuts or products of peanuts im25 ported into the United States;’’; and
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1 (C) in paragraph (4) (as so redesignated),

2 by striking ‘‘established under paragraph (1)’’;

3 (3) in subsection (b)—

4 (A) by striking ‘‘1997’’ each place it ap5 pears and inserting ‘‘2000’’;

6 (B) in paragraph (2), by striking subpara7 graph (B) and inserting the following:

8 ‘‘(B) TEMPORARY QUOTA ALLOCATION.—

9 ‘‘(i) IN GENERAL.—Subject to clause

10 (iv), temporary allocation of a poundage

11 quota for the marketing year in which a

12 crop of peanuts is planted shall be made to

13 producers for each of the 1991 through 2000

14 marketing years in accordance with this

15 subparagraph.

16 ‘‘(ii) QUANTITY.—The temporary quota

17 allocation shall be equal to the quantity of

18 seed peanuts (in pounds) planted on a

19 farm, as determined in accordance with reg20 ulations issued by the Secretary.

21 ‘‘(iii) ALLOCATION.—The allocation of

22 quota pounds to producers under this sub23 paragraph shall be performed in such a

24 manner as will not result in a net decrease

25 in quota pounds on a farm in excess of 3
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1 percent, after the temporary seed quota is

2 added, from the basic farm quota for the

3 1995 marketing year. A decrease shall occur

4 only once, and shall be applicable only to

5 the 1996 marketing year.

6 ‘‘(iv) NO INCREASED COSTS.—The Sec7 retary may carry out this subparagraph

8 only if this subparagraph does not result

9 in—

10 ‘‘(I) an increased cost to the Com11 modity Credit Corporation through

12 displacement of quota peanuts by addi13 tional peanuts in the domestic market;

14 ‘‘(II) an increased loss in a loan

15 pool of an area marketing association

16 designated pursuant to section

17 108B(c)(1) of the Agricultural Act of

18 1949 (7 U.S.C. 1445c–3(c)(1)); or

19 ‘‘(III) other increased costs.

20 ‘‘(v) USE OF QUOTA AND ADDITIONAL

21 PEANUTS.—Nothing in this subparagraph

22 affects the requirements of section 358b(b).

23 ‘‘(vi) ADDITIONAL ALLOCATION.—The

24 temporary allocation of quota pounds under

25 this subparagraph shall be in addition to
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1 the farm poundage quota established under

2 this subsection and shall be credited to the

3 producers of the peanuts on the farm in ac4 cordance with regulations issued by the Sec5 retary.’’; and

6 (C) by striking paragraphs (8) and (9); and

7 (4) in subsection (f), by striking ‘‘1997’’ and in8 serting ‘‘2000’’.

9 (c) SALE, LEASE, OR TRANSFER.—Section 358b of the

10 Agricultural Adjustment Act of 1938 (7 U.S.C. 1358b) is

11 amended to read as follows:

12 ‘‘SEC. 358b. SALE, LEASE, OR TRANSFER OF FARM POUND13 AGE QUOTA FOR 1991 THROUGH 2000 CROPS

14 OF PEANUTS.

15 ‘‘(a) IN GENERAL.—

16 ‘‘(1) AUTHORITY.—

17 ‘‘(A) IN GENERAL.—Subject to such terms,

18 conditions, or limitations as the Secretary may

19 prescribe, the owner, or operator with the per20 mission of the owner, of any farm for which a

21 farm poundage quota has been established under

22 this Act may sell or lease all or any part of the

23 poundage quota to any other owner or operator

24 of a farm within counties of a State for transfer

25 to the farm, except that any such lease of pound-
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1 age quota may be entered into in the fall or after

2 the normal planting season—

3 ‘‘(i) if not less than 90 percent of the

4 basic quota (consisting of the farm quota

5 and temporary quota transfers), plus any

6 poundage quota transferred to the farm

7 under this subsection, has been planted or

8 considered planted on the farm from which

9 the quota is to be leased; and

10 ‘‘(ii) under such terms and conditions

11 as the Secretary may prescribe by regula12 tion.

13 ‘‘(B) FALL TRANSFERS.—

14 ‘‘(i) NO TRANSFER AUTHORIZATION.—

15 In the case of a fall transfer or a transfer

16 after the normal planting season by a cash

17 lessee, the landowner shall not be required

18 to sign the transfer authorization.

19 ‘‘(ii) TIME LIMITATION.—A fall trans20 fer or a transfer after the normal planting

21 season may be made not later than 72 hours

22 after the peanuts that are the subject of the

23 transfer are inspected and graded.

24 ‘‘(iii) LESSEES.—In the case of a fall

25 transfer, poundage quota from a farm may
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1 be leased to an owner or operator of another

2 farm within the same county or to an

3 owner or operator of another farm in any

4 other county within the State.

5 ‘‘(iv) EFFECT OF TRANSFER.—A fall

6 transfer of poundage quota shall not affect

7 the farm quota history for the transferring

8 or receiving farm and shall not result in the

9 reduction of the farm poundage quota on

10 the transferring farm.

11 ‘‘(2) TRANSFERS TO OTHER SELF-OWNED

12 FARMS.—The owner or operator of a farm may trans13 fer all or any part of the farm poundage quota for

14 the farm to any other farm owned or controlled by the

15 owner or operator that is in the same State and that

16 had a farm poundage quota for the crop of the preced17 ing year, if both the transferring and receiving farms

18 were under the control of the owner or operator for

19 at least 3 crop years prior to the crop year in which

20 the farm poundage quota is to be transferred. Any

21 farm poundage quota transferred under this para22 graph shall not result in any reduction in the farm

23 poundage quota for the transferring farm if sufficient

24 acreage is planted on the receiving farm to produce

25 the quota pounds transferred.
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1 ‘‘(3) TRANSFERS IN STATES WITH SMALL

2 QUOTAS.—In the case of any State for which the

3 poundage quota allocated to the State was less than

4 10,000 tons for the crop of the preceding year, all or

5 any part of a farm poundage quota may be trans6 ferred by sale or lease or otherwise from a farm in

7 1 county to a farm in another county in the State.

8 ‘‘(4) TRANSFERS BY SALE IN STATES HAVING

9 QUOTAS OF 10,000 TONS OR MORE.—

10 ‘‘(A) IN GENERAL.—Subject to the other

11 provisions of this paragraph and such terms and

12 conditions as the Secretary may prescribe, the

13 owner, or operator with the permission of the

14 owner, of any farm for which a farm quota has

15 been established under this Act in a State for

16 which the poundage quota allocated to the State

17 was 10,000 tons or more may sell poundage

18 quota to any other eligible owner or operator of

19 a farm within the State.

20 ‘‘(B) LIMITATIONS BASED ON TOTAL POUND21 AGE QUOTA.—

22 ‘‘(i) 1996 MARKETING YEAR.—Not

23 more than 15 percent of the total poundage

24 quota within a county as of January 1,

25 1996, may be sold and transferred under
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1 this paragraph during the 1996 marketing

2 year.

3 ‘‘(ii) 1997–2000 MARKETING YEARS.—

4 ‘‘(I) IN GENERAL.—Except as pro5 vided in subclause (II), not more than

6 5 percent of the quota pounds remain7 ing in a county as of January 1, 1997,

8 and each January 1 thereafter through

9 January 1, 2000, may be sold and

10 transferred under this paragraph dur11 ing the applicable marketing year.

12 ‘‘(II) CARRYOVER.—Any eligible

13 quota that is not sold or transferred

14 under clause (i) shall be eligible for

15 sale or transfer under subclause (I).

16 ‘‘(C) COUNTY LIMITATION.—Not more than

17 35 percent of the total poundage quota within a

18 county may be sold and transferred under this

19 paragraph.

20 ‘‘(D) SUBSEQUENT LEASES OR SALES.—

21 Quota pounds sold and transferred to a farm

22 under this paragraph may not be leased or sold

23 by the farm to another owner or operator of a

24 farm within the same State for a period of 5
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1 years following the date of the original transfer

2 to the farm.

3 ‘‘(E) APPLICATION.—This paragraph shall

4 not apply to a sale within the same county or

5 to any sale, lease, or transfer described in para6 graph (1).

7 ‘‘(b) CONDITIONS.—Transfers (including transfer by

8 sale or lease) of farm poundage quotas under this section

9 shall be subject to all of the following conditions:

10 ‘‘(1) LIENHOLDERS.—No transfer of the farm

11 poundage quota from a farm subject to a mortgage or

12 other lien shall be permitted unless the transfer is

13 agreed to by the lienholders.

14 ‘‘(2) TILLABLE CROPLAND.—No transfer of the

15 farm poundage quota shall be permitted if the county

16 committee established under section 8(b) of the Soil

17 Conservation and Domestic Allotment Act (16 U.S.C.

18 590h(b)) determines that the receiving farm does not

19 have adequate tillable cropland to produce the farm

20 poundage quota.

21 ‘‘(3) RECORD.—No transfer of the farm pound22 age quota shall be effective until a record of the trans23 fer is filed with the county committee of each county

24 to, and from, which the transfer is made and each
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1 committee determines that the transfer complies with

2 this section.

3 ‘‘(4) OTHER TERMS.—The Secretary may estab4 lish by regulation other terms and conditions.

5 ‘‘(c) CROPS.—This section shall be effective only for

6 the 1991 through 2000 crops of peanuts.’’.

7 (d) EXPERIMENTAL AND RESEARCH PROGRAMS FOR

8 PEANUTS.—Section 358c(d) of the Agricultural Adjustment

9 Act of 1938 (7 U.S.C. 1358c(d)) is amended by striking

10 ‘‘1995’’ and inserting ‘‘2000’’.

11 (e) MARKETING PENALTIES AND DISPOSITION OF AD12 DITIONAL PEANUTS.—Section 358e of the Agricultural Ad13 justment Act of 1938 (7 U.S.C. 1359a) is amended—

14 (1) in the section heading, by striking ‘‘1997’’

15 and inserting ‘‘2000’’; and

16 (2) in subsection (i), by striking ‘‘1997’’ and in17 serting ‘‘2000’’.

18 SEC. 1114. CATASTROPHIC CROP INSURANCE COVERAGE.

19 (a) IN GENERAL.—Section 427 of the Agricultural Act

20 of 1949 (7 U.S.C. 1433f) is amended by striking ‘‘subse21 quent’’ and inserting ‘‘1996’’.

22 (b) CONFORMING AMENDMENTS.—Section 508(b) of the

23 Federal Crop Insurance Act (7 U.S.C. 1508(b)) is amend24 ed—

25 (1) by striking paragraph (6); and
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1 (2) by redesignating paragraphs (7) through (10)

2 as paragraphs (6) through (9), respectively.

3 (c) CROPS.—The amendments made by subsection (b)

4 shall apply beginning with the 1997 crop of an insurable

5 commodity.

6 SEC. 1115. SAVINGS ADJUSTMENT.

7 (a) PAYMENT RATES.—If the Director estimates that

8 total direct spending savings described in subsection (a)(1)

9 are less than $13,400,000,000, the Secretary of Agriculture

10 shall reduce the maximum payment rates for deficiency

11 payments for rice, upland cotton, feed grains, and wheat

12 provided in sections 302, 303, 304, and 305 of the Agricul13 tural Act of 1949 (as amended by this subtitle) by an equal

14 percentage for each of the 1996 through 2002 crops of the

15 commodity, to acheive total direct spending savings de16 scribed in subsection (a)(1) of $13,400,000,000.

17 (b) MAXIMUM REDUCTION.—The maximum deficiency

18 payment rate reduction under subsection (a) shall not ex19 ceed 2 percent.

20 SEC. 1116. SENSE OF THE SENATE REGARDING TAX PROVI21 SIONS RELATING TO ETHANOL.

22 (a) IN GENERAL.—The Senate finds that—

23 (1) ethanol and its derivative ethyl tertiary butyl

24 ether (ETBE) are used as fuels or additives to fuels

25 for motor vehicles;
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1 (2) ethanol and ETBE have been shown to im2 prove air quality when used as fuels or fuel additives;

3 (3) ethanol and ETBE are primarily made from

4 renewable resources and produced domestically;

5 (4) studies, including a study very recently re6 leased by the Department of Agriculture, have shown

7 that when used as fuel, ethanol and ETBE yield more

8 energy than is required to produce them;

9 (5) the use of domestically produced ethanol and

10 ETBE can thus reduce our nation’s reliance on en11 ergy imports and improve our energy security;

12 (6) the use of ethanol and ETBE adds signifi13 cantly to market opportunities for corn, which con14 stitutes about 95 percent of the feedstock for ethanol

15 production, thereby improving corn prices and farm

16 income;

17 (7) the production of ethanol and ETBE contrib18 utes substantially to improved economic and job

19 growth, particularly in rural communities;

20 (8) ethanol and ETBE currently qualify for tax

21 incentives which facilitate and promote the use of

22 these clean-burning, renewable, and domestically-pro23 duced fuels; and

24 (9) a recently-released report from the General

25 Accounting Office confirmed the results of numerous
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1 previous reports demonstrating that the ethanol tax

2 incentives result in net savings to the Federal Govern3 ment as farm program costs are reduced through im4 proved grain prices.

5 (b) SENSE OF THE SENATE.—It is the sense of the Sen6 ate that any legislation enacted by Congress should not

7 eliminate or in any way weaken or diminish incentives

8 under Federal tax laws or regulations that facilitate or pro9 mote the production, blending, or use of ethanol and ETBE.

10 SEC. 1117. EFFECTIVE DATE.

11 (a) EFFECTIVE DATE.—

12 (1) IN GENERAL.—Except as provided in this

13 subsection and as otherwise specifically provided in

14 this subtitle, this subtitle and the amendments made

15 by this subtitle shall apply beginning with the earlier

16 of—

17 (A) the 1996 crop of an agricultural com18 modity; or

19 (B) November 1, 1995.

20 (2) MILK.—This subtitle and the amendments

21 made by this subtitle shall apply to milk and dairy

22 products beginning on January 1, 1996.

23 (b) PRIOR CROPS.—

24 (1) IN GENERAL.—Except as otherwise specifi25 cally provided and notwithstanding any other provi-
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1 sion of law, this subtitle and the amendments made

2 by this subtitle shall not affect the authority of the

3 Secretary of Agriculture to carry out a price support

4 or production adjustment program for any of the

5 1991 through 1995 crops of an agricultural commod6 ity established under a provision of law in effect im7 mediately before the applicable effective date specified

8 in subsection (a).

9 (2) LIABILITY.—A provision of this subtitle or

10 an amendment made by this subtitle shall not affect

11 the liability of any person under any provision of law

12 as in effect before the application of the provision in

13 accordance with subsection (a).

14 Subtitle B—Conservation

15 SEC. 1201. CONSERVATION.

16 (a) FUNDING.—Subtitle E of title XII of the Food Se17 curity Act of 1985 (16 U.S.C. 3841 et seq.) is amended to

18 read as follows:

19 ‘‘Subtitle E—Funding

20 ‘‘SEC. 1241. FUNDING.

21 ‘‘(a) MANDATORY EXPENSES.—For each of fiscal years

22 1996 through 2002, the Secretary shall use the funds of the

23 Commodity Credit Corporation to carry out the programs

24 authorized by—
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1 ‘‘(1) subchapter B of chapter 1 of subtitle D (in2 cluding contracts extended by the Secretary pursuant

3 to section 1437 of the Food, Agriculture, Conserva4 tion, and Trade Act of 1990 (Public Law 101–624; 16

5 U.S.C. 3831 note));

6 ‘‘(2) subchapter C of chapter 1 of subtitle D; and

7 ‘‘(3) chapter 2 of subtitle D for practices related

8 to livestock production.

9 ‘‘(b) ENVIRONMENTAL QUALITY INCENTIVES PRO10 GRAM.—For each of fiscal years 1996 through 2002,

11 $100,000,000 of the funds of the Commodity Credit Cor12 poration shall be available for providing technical assist13 ance, cost-sharing payments, and incentive payments for

14 practices relating to livestock production under the environ15 mental quality incentives program.

16 ‘‘(c) WETLANDS RESERVE PROGRAM.—Spending to

17 carry out the wetlands reserve program under subchapter

18 C of chapter 1 of subtitle D shall be not greater than

19 $614,000,000 for fiscal years 1996 through 2002.

20 ‘‘(d) CONSERVATION RESERVE PROGRAM.—Spending

21 for the conservation reserve program (including contracts

22 extended by the Secretary pursuant to section 1437 of the

23 Food, Agriculture, Conservation, and Trade Act of 1990

24 (Public Law 101–624; 16 U.S.C. 3831 note)) shall be not

25 greater than—
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1 ‘‘(1) $1,787,000,000 for fiscal year 1996;

2 ‘‘(2) $1,784,000,000 for fiscal year 1997;

3 ‘‘(3) $1,445,000,000 for fiscal year 1998;

4 ‘‘(4) $1,246,000,000 for fiscal year 1999;

5 ‘‘(5) $1,101,000,000 for fiscal year 2000;

6 ‘‘(6) $999,000,000 for fiscal year 2001; and

7 ‘‘(7) $974,000,000 for fiscal year 2002.’’.

8 (b) ENVIRONMENTAL QUALITY INCENTIVES PRO9 GRAM.—To carry out the programs funded under the

10 amendment made by subsection (a), subtitle D of title XII

11 of the Food Security Act of 1985 (16 U.S.C. 3830 et seq.)

12 is amended by striking chapter 2 (16 U.S.C. 3838 et seq.)

13 and inserting the following:

14 ‘‘CHAPTER 2—ENVIRONMENTAL QUALITY

15 INCENTIVES PROGRAM

16 ‘‘SEC. 1238. DEFINITIONS.

17 ‘‘In this chapter:

18 ‘‘(1) LAND MANAGEMENT PRACTICE.—The term

19 ‘land management practice’ means a site-specific nu20 trient or manure management, integrated pest man21 agement, irrigation management, tillage or residue

22 management, grazing management, or other land

23 management practice that the Secretary determines is

24 needed to protect soil, water, or related resources in

25 the most cost effective manner.
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1 ‘‘(2) LARGE CONFINED LIVESTOCK OPERATION.—

2 The term ‘large confined livestock operation’ means a

3 farm or ranch that—

4 ‘‘(A) is a confined animal feeding oper5 ation; and

6 ‘‘(B) has more than—

7 ‘‘(i) 700 mature dairy cattle;

8 ‘‘(ii) 1,000 beef cattle;

9 ‘‘(iii) 30,000 laying hens or broilers (if

10 the facility has continuous overflow water11 ing);

12 ‘‘(iv) 100,000 laying hens or broilers

13 (if the facility has a liquid manure system);

14 ‘‘(v) 55,000 turkeys;

15 ‘‘(vi) 2,500 swine; or

16 ‘‘(vii) 10,000 sheep or lambs.

17 ‘‘(3) LIVESTOCK.—The term ‘livestock’ means

18 mature dairy cows, beef cattle, laying hens, broilers,

19 turkeys, swine, sheep, or lambs.

20 ‘‘(4) OPERATOR.—The term ‘operator’ means a

21 person who is engaged in crop or livestock production

22 (as defined by the Secretary).

23 ‘‘(5) STRUCTURAL PRACTICE.—The term ‘struc24 tural practice’ means the establishment of an animal

25 waste management facility, terrace, grassed water-
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1 way, contour grass strip, filterstrip, permanent wild2 life habitat, or other structural practice that the Sec3 retary determines is needed to protect soil, water, or

4 related resources in the most cost effective manner.

5 ‘‘SEC. 1238A. ESTABLISHMENT AND ADMINISTRATION OF

6 ENVIRONMENTAL QUALITY INCENTIVES PRO7 GRAM.

8 ‘‘(a) ESTABLISHMENT.—

9 ‘‘(1) IN GENERAL.—During the 1996 through

10 2002 fiscal years, the Secretary shall provide tech11 nical assistance, cost-sharing payments, and incentive

12 payments to operators who enter into contracts with

13 the Secretary, through an environmental quality in14 centives program that replaces the functions of the ag15 ricultural conservation program, the Great Plains

16 conservation program, the water quality incentives

17 program, and the Colorado River Basin salinity con18 trol program.

19 ‘‘(2) ELIGIBLE PRACTICES.—

20 ‘‘(A) STRUCTURAL PRACTICES.—An opera21 tor who implements a structural practice shall be

22 eligible for technical assistance or cost-sharing

23 payments, or both.

24 ‘‘(B) LAND MANAGEMENT PRACTICES.—An

25 operator who performs a land management prac-
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1 tice shall be eligible for technical assistance or

2 incentive payments, or both.

3 ‘‘(3) ELIGIBLE LANDS.—Land on which struc4 tural and land management practices may be per5 formed under this chapter includes agricultural land

6 (including cropland, rangeland, pasture, and other

7 land on which crops or livestock are produced) that

8 the Secretary determines poses a serious threat to soil,

9 water, or related resources by reason of the soil types,

10 terrain, climatic, soil, topographic, flood, or saline

11 characteristics, or other factors or natural hazards.

12 ‘‘(4) PRIORITIES.—The Secretary shall provide

13 technical assistance, cost-sharing payments, and in14 centive payments to operators in a region, watershed,

15 or conservation priority area in which an agricul16 tural operation is located, as determined by the Sec17 retary, based on national and regional priorities that

18 include—

19 ‘‘(A) the significance of the soil, water, and

20 related natural resource problems;

21 ‘‘(B) structural or land management prac22 tices for which State or local governments have

23 provided, or will provide, financial or technical

24 assistance to the operators;
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1 ‘‘(C) structural practices or land manage2 ment practices on lands on which agricultural

3 production has been determined to contribute to,

4 or create, the potential for failure to meet appli5 cable water quality standards or other environ6 mental objectives of a Federal or State law; and

7 ‘‘(D) maximization of environmental bene8 fits per dollar expended.

9 ‘‘(b) APPLICATION AND TERM.—

10 ‘‘(1) IN GENERAL.—A contract between an oper11 ator and the Secretary under this chapter may—

12 ‘‘(A) apply to 1 or more structural practices

13 or 1 or more land management practices, or

14 both; and

15 ‘‘(B) have a term of not less than 5, nor

16 more than 10, years, as determined appropriate

17 by the Secretary, depending on the practice or

18 practices that are the basis of the contract.

19 ‘‘(2) DUTIES OF OPERATORS AND SECRETARY.—

20 To receive cost sharing or incentive payments, or

21 technical assistance, participating operators shall

22 comply with all terms and conditions of the contract

23 and a plan, as established by the Secretary.

24 ‘‘(c) STRUCTURAL PRACTICES.—
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1 ‘‘(1) COMPETITIVE OFFER.—The Secretary shall

2 administer a competitive offer system for operators

3 proposing to receive cost-sharing payments in ex4 change for the implementation of 1 or more structural

5 practices by the operator. The competitive offer system

6 shall consist of—

7 ‘‘(A) the submission of a competitive offer

8 by the operator in such manner as the Secretary

9 may prescribe; and

10 ‘‘(B) evaluation of the offer in light of the

11 priorities established by subsection (a)(4) and

12 the projected cost of the proposal, as determined

13 by the Secretary.

14 ‘‘(2) CONCURRENCE OF OWNER.—If the operator

15 making an offer to implement a structural practice is

16 a tenant of the land involved in agricultural produc17 tion, for the offer to be acceptable, the operator shall

18 obtain the concurrence of the owner of the land with

19 respect to the offer.

20 ‘‘(d) LAND MANAGEMENT PRACTICES.—The Secretary

21 shall establish an application and evaluation process for

22 awarding technical assistance or incentive payments, or

23 both, to an operator in exchange for the performance of 1

24 or more land management practices by the operator.
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1 ‘‘(e) COST-SHARING, INCENTIVE PAYMENTS, AND

2 TECHNICAL ASSISTANCE.—

3 ‘‘(1) COST-SHARING PAYMENTS.—

4 ‘‘(A) IN GENERAL.—The Federal share of

5 cost-sharing payments to an operator proposing

6 to implement 1 or more structural practices shall

7 not be greater than 75 percent of the projected

8 cost of each practice, as determined by the Sec9 retary, taking into consideration any payment

10 received by the operator from a State or local

11 government.

12 ‘‘(B) LIMITATION.—An operator of a large

13 confined livestock operation shall not be eligible

14 for cost-sharing payments to construct an ani15 mal waste management facility.

16 ‘‘(C) OTHER PAYMENTS.—An operator shall

17 not be eligible for cost-sharing payments for

18 structural practices on eligible land under this

19 chapter if the operator receives cost-sharing pay20 ments or other benefits for the same land under

21 chapter 1 or 3.

22 ‘‘(2) INCENTIVE PAYMENTS.—The Secretary shall

23 make incentive payments in an amount and at a rate

24 determined by the Secretary to be necessary to encour-
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1 age an operator to perform 1 or more land manage2 ment practices.

3 ‘‘(3) TECHNICAL ASSISTANCE.—

4 ‘‘(A) FUNDING.—The Secretary shall allo5 cate funding under this chapter for the provision

6 of technical assistance according to the purpose

7 and projected cost for which the technical assist8 ance is provided for a fiscal year. The allocated

9 amount may vary according to the type of exper10 tise required, quantity of time involved, and

11 other factors as determined appropriate by the

12 Secretary. Funding shall not exceed the projected

13 cost to the Secretary of the technical assistance

14 provided for a fiscal year.

15 ‘‘(B) OTHER AUTHORITIES.—The receipt of

16 technical assistance under this chapter shall not

17 affect the eligibility of the operator to receive

18 technical assistance under other authorities of

19 law available to the Secretary.

20 ‘‘(f) LIMITATION ON PAYMENTS.—

21 ‘‘(1) IN GENERAL.—The total amount of cost22 sharing and incentive payments paid to a person

23 under this chapter may not exceed—

24 ‘‘(A) $10,000 for any fiscal year; or

25 ‘‘(B) $50,000 for any multiyear contract.
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1 ‘‘(2) REGULATIONS.—The Secretary shall issue

2 regulations that are consistent with section 1001 for

3 the purpose of—

4 ‘‘(A) defining the term ‘person’ as used in

5 paragraph (1); and

6 ‘‘(B) prescribing such rules as the Secretary

7 determines necessary to ensure a fair and rea8 sonable application of the limitations established

9 under this subsection.

10 ‘‘(g) REGULATIONS.—Not later than 180 days after the

11 effective date of this subsection, the Secretary shall issue reg12 ulations to implement the environmental quality incentives

13 program established under this chapter.

14 ‘‘SEC. 1238B. TEMPORARY ADMINISTRATION OF ENVIRON15 MENTAL QUALITY INCENTIVES PROGRAM.

16 ‘‘(a) INTERIM ADMINISTRATION.—

17 ‘‘(1) IN GENERAL.—During the period beginning

18 on the date of enactment of the Agricultural Rec19 onciliation Act of 1995 and ending on the later of the

20 dates specified in paragraph (2), to ensure that tech21 nical assistance, cost-sharing payments, and incentive

22 payments continue to be administered in an orderly

23 manner until such time as assistance can be provided

24 through final regulations issued to implement the en25 vironmental quality incentives program established
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1 under this chapter, the Secretary shall continue to

2 provide technical assistance, cost-sharing payments,

3 and incentive payments under the terms and condi4 tions of the agricultural conservation program, the

5 Great Plains conservation program, the water quality

6 incentives program, and the Colorado River Basin sa7 linity control program, to the extent that the terms

8 and conditions of the programs are consistent with

9 the environmental quality incentives program.

10 ‘‘(2) EXPIRATION OF AUTHORITY.—The author11 ity of the Secretary to carry out paragraph (1) shall

12 terminate on the later of—

13 ‘‘(A) the date that is 180 days after the date

14 of enactment of the Agricultural Reconciliation

15 Act of 1995; or

16 ‘‘(B) March 31, 1996.

17 ‘‘(b) PERMANENT ADMINISTRATION.—Effective begin18 ning on the later of the dates specified in subsection (a)(2),

19 the Secretary shall provide technical assistance, cost-shar20 ing payments, and incentive payments for structural prac21 tices and land management practices related to crop and

22 livestock production in accordance with final regulations

23 issued to carry out the environmental quality incentives

24 program.’’.

25 (c) CONFORMING AMENDMENTS.—
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1 (1) COMMODITY CREDIT CORPORATION CHARTER

2 ACT.—Section 5(g) of the Commodity Credit Corpora3 tion Charter Act (15 U.S.C. 714c(g)) is amended to

4 read as follows:

5 ‘‘(g) Carry out conservation functions and programs.’’.

6 (2) WETLANDS RESERVE PROGRAM.—

7 (A) IN GENERAL.—Section 1237 of the Food

8 Security Act of 1985 (16 U.S.C. 3837) is amend9 ed—

10 (i) in subsection (b)(2)—

11 (I) by striking ‘‘not less’’ and in12 serting ‘‘not more’’; and

13 (II) by striking ‘‘2000’’ and in14 serting ‘‘2002’’; and

15 (ii) in subsection (c), by striking

16 ‘‘2000’’ and inserting ‘‘2002’’.

17 (B) LENGTH OF EASEMENT.—Section

18 1237A(e) of the Food Security Act of 1985 (16

19 U.S.C. 3837a(e)) is amended by striking para20 graph (2) and inserting the following:

21 ‘‘(2) shall be for 20 or 30 years, but in no case

22 shall be a permanent easement.’’.

23 (3) CONSERVATION RESERVE PROGRAM.—
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1 (A) IN GENERAL.—Section 1231 of the Food

2 Security Act of 1985 (16 U.S.C. 3831) is amend3 ed—

4 (i) in subsections (a) and (b)(3), by

5 striking ‘‘1995’’ each place it appears and

6 inserting ‘‘2002’’; and

7 (ii) in subsection (d), by striking

8 ‘‘total of’’ and all that follows through the

9 period at the end of the subsection and in10 serting ‘‘total of 36,400,000 acres during the

11 1986 through 2002 calendar years (includ12 ing contracts extended by the Secretary pur13 suant to section 1437 of the Food, Agri14 culture, Conservation, and Trade Act of

15 1990 (Public Law 101–624; 16 U.S.C. 3831

16 note), except that in no case may total

17 spending for the conservation reserve exceed

18 the spending limitations in section

19 1241(d).’’.

20 (B) CONFORMING AMENDMENT.—Section

21 1232(c) of the Food Security Act of 1985 (16

22 U.S.C. 3832(c)) is amended by striking ‘‘1995’’

23 and inserting ‘‘2002’’.

24 (d) EFFECTIVE DATES.—
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1 (1) IN GENERAL.—Except as provided in para2 graph (2), this section and the amendments made by

3 this section shall become effective on the later of—

4 (A) the date of enactment of this Act; or

5 (B) November 1, 1995.

6 (2) TRANSITION PROVISIONS.—

7 (A) IN GENERAL.—Section 1238B of the

8 Food Security Act of 1985 (as added by sub9 section (b)) shall become effective on the date of

10 enactment of this Act.

11 (B) 1991 THROUGH 1995 CALENDAR

12 YEARS.—Notwithstanding any other provision of

13 law, this section and the amendments made by

14 this section shall not affect the authority of the

15 Secretary of Agriculture to carry out a program

16 for any of the 1991 through 1995 calendar years

17 under a provision of law in effect immediately

18 before the effective dates specified in this sub19 section.

20 Subtitle C—Agricultural Promotion

21 and Export Programs

22 SEC. 1301. MARKET PROMOTION PROGRAM.

23 Effective October 1, 1995, section 211(c)(1) of the Agri24 cultural Trade Act of 1978 (7 U.S.C. 5641(c)(1)) is amend25 ed—
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1 (1) by striking ‘‘and’’ after ‘‘1991 through

2 1993,’’; and

3 (2) by striking ‘‘through 1997,’’ and inserting

4 ‘‘through 1995, and not more than $75,000,000 for

5 each of fiscal years 1996 through 2002,’’.

6 SEC. 1302. EXPORT ENHANCEMENT PROGRAM.

7 Effective October 1, 1995, section 301(e)(1) of the Agri8 cultural Trade Act of 1978 (7 U.S.C. 5651(e)(1)) is amend9 ed to read as follows:

10 ‘‘(1) IN GENERAL.—The Commodity Credit Cor11 poration shall make available to carry out the pro12 gram established under this section not more than—

13 ‘‘(A) $767,200,000 for fiscal year 1996;

14 ‘‘(B) $705,600,000 for fiscal year 1997;

15 ‘‘(C) $624,800,000 for fiscal year 1998;

16 ‘‘(D) $544,000,000 for fiscal year 1999;

17 ‘‘(E) $463,200,000 for fiscal year 2000;

18 ‘‘(F) $382,400,000 for fiscal year 2001; and

19 ‘‘(G) $382,400,000 for fiscal year 2002.’’.

20 SEC. 1303. EXPORT OF SUNFLOWERSEED OIL AND COTTON21 SEED OIL.

22 (a) IN GENERAL.—Effective September 30, 1995, sec23 tion 301 of the Disaster Assistance Act of 1988 (Public Law

24 100–387; 7 U.S.C. 1464 note) is repealed.
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1 (b) FUNDING.—Notwithstanding any other provision

2 of law, the Secretary of Agriculture shall not spend any

3 funds made available under section 32 of the Act entitled

4 ‘‘An Act to amend the Agricultural Adjustment Act, and

5 for other purposes’’, approved August 24, 1935 (7 U.S.C.

6 612c), to carry out the programs established under section

7 301(b) of the Disaster Assistance Act of 1988 (Public Law

8 100–387; 7 U.S.C. 1464 note) (as in effect prior to the

9 amendment made by subsection (a)).

10 Subtitle D—Nutrition Assistance

11 CHAPTER 1—FOOD STAMP PROGRAM

12 SEC. 1401. TREATMENT OF CHILDREN LIVING AT HOME.

13 The second sentence of section 3(i) of the Food Stamp

14 Act of 1977 (7 U.S.C. 2012(i)) is amended by striking

15 ‘‘(who are not themselves parents living with their children

16 or married and living with their spouses)’’.

17 SEC. 1402. OPTIONAL ADDITIONAL CRITERIA FOR SEPA18 RATE HOUSEHOLD DETERMINATIONS.

19 Section 3(i) of the Food Stamp Act of 1977 (7 U.S.C.

20 2012(i)) is amended by inserting after the third sentence

21 the following: ‘‘Notwithstanding the preceding sentences, a

22 State may establish criteria that prescribe when individuals

23 who live together, and who would be allowed to participate

24 as separate households under the preceding sentences, shall
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1 be considered a single household, without regard to the com2 mon purchase of food and preparation of meals.’’.

3 SEC. 1403. ADJUSTMENT OF THRIFTY FOOD PLAN.

4 The second sentence of section 3(o) of the Food Stamp

5 Act of 1977 (7 U.S.C. 2012(o)) is amended—

6 (1) by striking ‘‘and (11)’’ and inserting ‘‘(11)’’;

7 (2) by inserting ‘‘through October 1, 1994’’ after

8 ‘‘1990, and each October 1 thereafter’’; and

9 (3) by inserting before the period at the end the

10 following: ‘‘, and (12) on October 1, 1995, and each

11 October 1 thereafter, adjust the cost of the diet to re12 flect the cost of the diet, in the preceding June, and

13 round the result to the nearest lower dollar increment

14 for each household size, except that on October 1,

15 1995, the Secretary may not reduce the cost of the

16 diet in effect on September 30, 1995’’.

17 SEC. 1404. DEFINITION OF HOMELESS INDIVIDUAL.

18 Section 3(s)(2)(C) of the Food Stamp Act of 1977 (7

19 U.S.C. 2012(s)(2)(C)) is amended by inserting ‘‘for not

20 more than 90 days’’ after ‘‘temporary accommodation’’.

21 SEC. 1405. STATE OPTIONS IN REGULATIONS.

22 Section 5(b) of the Food Stamp Act of 1977 (7 U.S.C.

23 2014(b)) is amended—

24 (1) by striking ‘‘(b) The Secretary’’ and insert25 ing the following:
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1 ‘‘(b) UNIFORM STANDARDS.—Except as otherwise pro2 vided in this Act, the Secretary’’; and

3 (2) by striking ‘‘No plan’’ and inserting ‘‘Except

4 as otherwise provided in this Act, no plan’’.

5 SEC. 1406. ENERGY ASSISTANCE.

6 (a) IN GENERAL.—Section 5(d) of the Food Stamp Act

7 of 1977 (7 U.S.C. 2014(d)) is amended—

8 (1) by striking paragraph (11); and

9 (2) by redesignating paragraphs (12) through

10 (15) as paragraphs (11) through (14), respectively.

11 (b) CONFORMING AMENDMENTS.—

12 (1) Section 5(k) of the Act (7 U.S.C. 2014(k)) is

13 amended—

14 (A) in paragraph (1)—

15 (i) in subparagraph (A), by striking

16 ‘‘plan for aid to families with dependent

17 children approved’’ and inserting ‘‘program

18 funded’’; and

19 (ii) in subparagraph (B), by striking

20 ‘‘, not including energy or utility-cost as21 sistance,’’;

22 (B) in paragraph (2)—

23 (i) by striking subparagraph (C); and
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1 (ii) by redesignating subparagraphs

2 (D) through (H) as subparagraphs (C)

3 through (G), respectively; and

4 (C) by adding at the end the following:

5 ‘‘(4) THIRD PARTY ENERGY ASSISTANCE PAY6 MENTS.—

7 ‘‘(A) ENERGY ASSISTANCE PAYMENTS.—For

8 purposes of subsection (d)(1), a payment made

9 under a Federal or State law to provide energy

10 assistance to a household shall be considered

11 money payable directly to the household.

12 ‘‘(B) ENERGY ASSISTANCE EXPENSES.—For

13 purposes of subsection (e), an expense paid on

14 behalf of a household under a Federal or State

15 law to provide energy assistance shall be consid16 ered an out-of-pocket expense incurred and paid

17 by the household.’’.

18 (2) Section 2605(f) of the Low-Income Home En19 ergy Assistance Act of 1981 (42 U.S.C. 8624(f)) is

20 amended—

21 (A) by striking ‘‘(f)(1) Notwithstanding’’

22 and inserting ‘‘(f) Notwithstanding’’;

23 (B) by striking ‘‘food stamps,’’; and

24 (C) by striking paragraph (2).
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1 SEC. 1407. DEDUCTIONS FROM INCOME.

2 (a) IN GENERAL.—Section 5(e) of the Food Stamp Act

3 of 1977 (7 U.S.C. 2014(e)) is amended—

4 (1) in the second sentence—

5 (A) by striking ‘‘and (4)’’ and inserting

6 ‘‘(4)’’;

7 (B) by inserting ‘‘through October 1, 1994’’

8 after ‘‘October 1 thereafter’’; and

9 (C) by inserting before the period at the end

10 the following: ‘‘, and (5) on October 1, 2002, and

11 each October 1 thereafter, the Secretary shall ad12 just the standard deduction to the nearest lower

13 dollar increment to reflect changes in the

14 Consumer Price Index for all urban consumers

15 published by the Bureau of Labor Statistics, for

16 items other than food, for the 12-month period

17 ending the preceding June 30’’;

18 (2) in the third sentence, by striking ‘‘willfully

19 or fraudulently’’ and all that follows through ‘‘to re20 port’’ and inserting ‘‘has not reported’’;

21 (3) in the seventh sentence, by striking ‘‘may use

22 a standard’’ and all that follows through ‘‘except that

23 a’’ and inserting ‘‘may make the use of a standard

24 utility allowance mandatory for all households with

25 qualifying utility costs if the State agency has devel26 oped 1 or more standards that include the cost of
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1 heating and cooling and 1 or more standards that do

2 not include the cost of heating and cooling and the

3 Secretary finds that the standards will not result in

4 an increased cost to the Secretary. A State agency

5 that has not made the use of a standard utility allow6 ance mandatory under the preceding sentence shall

7 allow a household to switch, at the end of a certifi8 cation period, between the standard utility allowance

9 and a deduction based on the actual utility costs of

10 the household. A’’; and

11 (4) by striking ‘‘A State agency shall allow a

12 household to switch’’ and all that follows through

13 ‘‘twelve-month period.’’.

14 (b) HOMELESS SHELTER DEDUCTION.—Section

15 11(e)(3) of the Act (7 U.S.C. 2020(e)(3)) is amended by

16 striking the last 3 sentences and inserting the following: ‘‘A

17 State agency may develop a standard homeless shelter de18 duction, which shall not exceed $139 per month, for such

19 expenses as may reasonably be expected to be incurred by

20 households in which all members are homeless individuals

21 but are not receiving free shelter throughout the month. A

22 State agency that develops the deduction may use the deduc23 tion in determining eligibility and allotments for the house24 holds, except that the State agency may prohibit the use
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1 of the deduction for households with extremely low shelter

2 costs;’’.

3 SEC. 1408. AMOUNT OF VEHICLE ASSET LIMITATION.

4 The first sentence of section 5(g)(2) of the Food Stamp

5 Act of 1977 (7 U.S.C. 2014(g)(2)) is amended by striking

6 ‘‘through September 30, 1995’’ and all that follows through

7 ‘‘such date and on’’ and inserting ‘‘and shall be adjusted

8 on October 1, 1996, and’’.

9 SEC. 1409. BENEFITS FOR ALIENS.

10 Section 5(i) of the Food Stamp Act of 1977 (7 U.S.C.

11 2014(i)) is amended—

12 (1) in the first sentence of paragraph (1)—

13 (A) by inserting ‘‘or who executed such an

14 affidavit or similar agreement to enable the indi15 vidual to lawfully remain in the United States,’’

16 after ‘‘respect to such individual,’’; and

17 (B) by striking ‘‘for a period’’ and all that

18 follows through the period at the end of the sen19 tence and inserting ‘‘until the end of the period

20 ending on the later of the date agreed to in the

21 affidavit or agreement or the date that is 5 years

22 after the date on which the individual was first

23 lawfully admitted into the United States follow24 ing the execution of the affidavit or agreement.’’;

25 (2) in paragraph (2)—
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1 (A) in the first sentence of subparagraph

2 (C)(i), by striking ‘‘of three years after entry

3 into the United States’’ and inserting ‘‘deter4 mined under paragraph (1)’’;

5 (B) in the first sentence of subparagraph

6 (D), by striking ‘‘of three years after such alien’s

7 entry into the United States’’ and inserting ‘‘de8 termined under paragraph (1)’’; and

9 (C) by adding at the end the following:

10 ‘‘(F) LIMITATION ON MEASUREMENT OF AT11 TRIBUTED INCOME AND RESOURCES.—

12 ‘‘(i) IN GENERAL.—Notwithstanding

13 any other provision of this subsection, if a

14 determination described in clause (ii) is

15 made, the amount of income and resources

16 of the sponsor or the sponsor’s spouse that

17 shall be attributed to the sponsored individ18 ual shall not exceed the amount actually

19 provided to the individual, for—

20 ‘‘(I) the 12-month period begin21 ning on the date of the determination;

22 or

23 ‘‘(II) if the address of the sponsor

24 is unknown to the sponsored individ25 ual on the date of the determination,
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1 the 12-month period beginning on the

2 date the address becomes known to the

3 sponsored individual or to the Sec4 retary (who shall inform the individ5 ual of the address not later than 7

6 days after learning the address).

7 ‘‘(ii) DETERMINATION.—The deter8 mination described in this clause shall be a

9 determination by the Secretary that a spon10 sored individual would, in the absence of

11 the assistance provided by this Act, be un12 able to obtain food, taking into account the

13 individual’s own income, plus any cash,

14 food, housing, or other assistance provided

15 by other individuals, including the spon16 sor.’’; and

17 (3) by adding at the end the following:

18 ‘‘(3) TREATMENT OF NONCITIZENS.—

19 ‘‘(A) IN GENERAL.—Notwithstanding any

20 other provision of law, a noncitizen who has en21 tered into the United States on or after the date

22 of the enactment of this paragraph shall not,

23 during the 5-year period beginning on the date

24 of the noncitizen’s entry into the United States,

25 be eligible to receive any benefits under this Act.
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1 ‘‘(B) EXCEPTIONS.—Subparagraph (A)

2 shall not apply to any individual who is—

3 ‘‘(i) a noncitizen granted asylum

4 under section 208 of the Immigration and

5 Nationality Act (8 U.S.C. 1158) or whose

6 deportation has been withheld under section

7 243(h) of the Act (8 U.S.C. 1253(b)) for a

8 period of not more than 5 years after the

9 date the noncitizen arrived in the United

10 States;

11 ‘‘(ii) a noncitizen admitted to the

12 United States as a refugee under section

13 207 of the Act (8 U.S.C. 1157) for not more

14 than 5 years after the date the noncitizen

15 arrived in the United States; or

16 ‘‘(iii) a noncitizen, lawfully present in

17 any State (or any territory or possession of

18 the United States), who is—

19 ‘‘(I) a veteran (as defined in sec20 tion 101 of title 38, United States

21 Code) with a discharge characterized

22 as an honorable discharge and not on

23 account of alienage; or
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1 ‘‘(II) the spouse or unmarried de2 pendent child of a veteran described in

3 subclause (I).’’.

4 SEC. 1410. DISQUALIFICATION.

5 (a) IN GENERAL.—Section 6(d) of the Food Stamp Act

6 of 1977 (7 U.S.C. 2015(d)) is amended—

7 (1) by striking ‘‘(d)(1) Unless otherwise exempt8 ed by the provisions’’ and all that follows through

9 ‘‘shall be ninety days. The’’ and inserting the follow10 ing:

11 ‘‘(d) CONDITIONS OF PARTICIPATION.—

12 ‘‘(1) WORK REQUIREMENTS.—

13 ‘‘(A) IN GENERAL.—No physically and

14 mentally fit individual over the age of 15 and

15 under the age of 60 shall be eligible to partici16 pate in the food stamp program if the individ17 ual—

18 ‘‘(i) refuses, at the time of application

19 and every 12 months thereafter, to register

20 for employment in a manner prescribed by

21 the Secretary;

22 ‘‘(ii) refuses without good cause to par23 ticipate in an employment and training

24 program under paragraph (4), to the extent

25 required by the State agency;
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1 ‘‘(iii) refuses without good cause to ac2 cept an offer of employment, at a site or

3 plant not subject to a strike or lockout at

4 the time of the refusal, at a wage not less

5 than the higher of—

6 ‘‘(I) the applicable Federal or

7 State minimum wage; or

8 ‘‘(II) 80 percent of the wage that

9 would have governed had the minimum

10 hourly rate under section 6(a)(1) of the

11 Fair Labor Standards Act of 1938 (29

12 U.S.C. 206(a)(1)) been applicable to

13 the offer of employment;

14 ‘‘(iv) refuses without good cause to pro15 vide a State agency with sufficient informa16 tion to allow the State agency to determine

17 the employment status or the job availabil18 ity of the individual;

19 ‘‘(v) voluntarily and without good

20 cause—

21 ‘‘(I) quits a job; or

22 ‘‘(II) reduces work effort and,

23 after the reduction, the individual is

24 working less than 30 hours per week;

25 or
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1 ‘‘(vi) fails to comply with section 20.

2 ‘‘(B) HOUSEHOLD INELIGIBILITY.—If an

3 individual who is the head of a household be4 comes ineligible to participate in the food stamp

5 program under subparagraph (A), the household

6 shall, at the option of the State agency, become

7 ineligible to participate in the food stamp pro8 gram for a period, determined by the State agen9 cy, that does not exceed the lesser of—

10 ‘‘(i) the duration of the ineligibility of

11 the individual determined under subpara12 graph (C); or

13 ‘‘(ii) 180 days.

14 ‘‘(C) DURATION OF INELIGIBILITY.—

15 ‘‘(i) FIRST VIOLATION.—The first time

16 that an individual becomes ineligible to

17 participate in the food stamp program

18 under subparagraph (A), the individual

19 shall remain ineligible until the later of—

20 ‘‘(I) the date the individual be21 comes eligible under subparagraph (A);

22 ‘‘(II) the date that is 1 month

23 after the date the individual became

24 ineligible; or
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1 ‘‘(III) a date determined by the

2 State agency that is not later than 3

3 months after the date the individual

4 became ineligible.

5 ‘‘(ii) SECOND VIOLATION.—The second

6 time that an individual becomes ineligible

7 to participate in the food stamp program

8 under subparagraph (A), the individual

9 shall remain ineligible until the later of—

10 ‘‘(I) the date the individual be11 comes eligible under subparagraph (A);

12 ‘‘(II) the date that is 3 months

13 after the date the individual became

14 ineligible; or

15 ‘‘(III) a date determined by the

16 State agency that is not later than 6

17 months after the date the individual

18 became ineligible.

19 ‘‘(iii) THIRD OR SUBSEQUENT VIOLA20 TION.—The third or subsequent time that

21 an individual becomes ineligible to partici22 pate in the food stamp program under sub23 paragraph (A), the individual shall remain

24 ineligible until the later of—
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1 ‘‘(I) the date the individual be2 comes eligible under subparagraph (A);

3 ‘‘(II) the date that is 6 months

4 after the date the individual became

5 ineligible;

6 ‘‘(III) a date determined by the

7 State agency; or

8 ‘‘(IV) at the option of the State

9 agency, permanently.

10 ‘‘(D) OTHER CONDITIONS.—The’’; and

11 (2) in paragraph (1), by striking ‘‘Any period of

12 ineligibility’’ and all that follows through ‘‘violated.’’.

13 (b) CONFORMING AMENDMENT.—

14 (1) The second sentence of section 17(b)(2) of the

15 Act (7 U.S.C. 2026(b)(2)) is amended by striking

16 ‘‘6(d)(1)(i)’’ and inserting ‘‘6(d)(1)(A)(i)’’.

17 (2) Section 20 of the Act (7 U.S.C. 2029) is

18 amended by striking subsection (f) and inserting the

19 following:

20 ‘‘(f) DISQUALIFICATION.—An individual or a house21 hold may become ineligible under section 6(d)(1) to partici22 pate in the food stamp program for failing to comply with

23 this section.’’.
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1 SEC. 1411. EMPLOYMENT AND TRAINING.

2 (a) IN GENERAL.—Section 6(d)(4) of the Food Stamp

3 Act of 1977 (7 U.S.C. 2015(d)(4)) is amended by adding

4 at the end the following:

5 ‘‘(O) LIMITATION ON FUNDING.—Notwith6 standing any other provision of this paragraph,

7 the amount of funds a State agency uses to carry

8 out this paragraph (including under subpara9 graph (I)) for participants who are receiving

10 benefits under a State program funded under

11 part A of title IV of the Social Security Act (42

12 U.S.C. 601 et seq.) shall not exceed the amount

13 of funds the State agency used in fiscal year

14 1995 to carry out this paragraph for partici15 pants who were receiving benefits in fiscal year

16 1995 under a State program funded under part

17 A of title IV of the Act (42 U.S.C. 601 et seq.).’’.

18 (b) FUNDING.—Section 16(h) of the Act (7 U.S.C.

19 2025(h)) is amended by striking ‘‘(h)(1)(A) The Secretary’’

20 and all that follows through the end of paragraph (1) and

21 inserting the following:

22 ‘‘(h) FUNDING OF EMPLOYMENT AND TRAINING PRO23 GRAMS.—

24 ‘‘(1) IN GENERAL.—

25 ‘‘(A) AMOUNTS.—To carry out employment

26 and training programs, the Secretary shall re-
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1 serve for allocation to State agencies from funds

2 made available for each fiscal year under section

3 18(a)(1) the amount of—

4 ‘‘(i) for fiscal year 1996, $77,000,000;

5 ‘‘(ii) for fiscal year 1997, $80,000,000;

6 ‘‘(iii) for fiscal year 1998, $83,000,000;

7 ‘‘(iv) for fiscal year 1999, $86,000,000;

8 ‘‘(v) for fiscal year 2000, $89,000,000;

9 ‘‘(vi) for fiscal year 2001, $92,000,000;

10 and

11 ‘‘(vii) for fiscal year 2002,

12 $95,000,000.

13 ‘‘(B) ALLOCATION.—The Secretary shall al14 locate the amounts reserved under subparagraph

15 (A) among the State agencies using a reasonable

16 formula (as determined by the Secretary) that

17 gives consideration to the population in each

18 State affected by section 6(n).

19 ‘‘(C) REALLOCATION.—

20 ‘‘(i) NOTIFICATION.—A State agency

21 shall promptly notify the Secretary if the

22 State agency determines that the State

23 agency will not expend all of the funds allo24 cated to the State agency under subpara25 graph (B).
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1 ‘‘(ii) REALLOCATION.—On notification

2 under clause (i), the Secretary shall reallo3 cate the funds that the State agency will not

4 expend as the Secretary considers appro5 priate and equitable.

6 ‘‘(D) MINIMUM ALLOCATION.—Notwith7 standing subparagraphs (A) through (C), the

8 Secretary shall ensure that each State agency op9 erating an employment and training program

10 shall receive not less than $50,000 for each fiscal

11 year.’’.

12 SEC. 1412. INCOME CALCULATION.

13 Section 6(f) of the Food Stamp Act of 1977 (7 U.S.C.

14 2015(f)) is amended by striking the third sentence and in15 serting the following: ‘‘The State agency may consider ei16 ther all income and financial resources of the individual

17 rendered ineligible to participate in the food stamp pro18 gram under this subsection, or the income, less a pro rata

19 share, and the financial resources of the ineligible individ20 ual, to determine the eligibility and the value of the allot21 ment of the household of which the individual is a mem22 ber.’’.
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1 SEC. 1413. COMPARABLE TREATMENT FOR DISQUALIFICA2 TION.

3 (a) IN GENERAL.—Section 6 of the Food Stamp Act

4 of 1977 (7 U.S.C. 2015) is amended by adding at the end

5 the following:

6 ‘‘(i) COMPARABLE TREATMENT FOR DISQUALIFICA7 TION.—

8 ‘‘(1) IN GENERAL.—If a disqualification is im9 posed on a member of a household for a failure of the

10 member to perform an action required under a Fed11 eral, State, or local law relating to a welfare or pub12 lic assistance program, the State agency may impose

13 the same disqualification on the member of the house14 hold under the food stamp program.

15 ‘‘(2) APPLICATION AFTER DISQUALIFICATION PE16 RIOD.—A member of a household disqualified under

17 paragraph (1) may, after the disqualification period

18 has expired, apply for benefits under this Act and

19 shall be treated as a new applicant, except that a

20 prior disqualification under subsection (d) shall be

21 considered in determining eligibility.’’.

22 (b) CONFORMING AMENDMENT.—Section 6(d)(2)(A) of

23 the Act (7 U.S.C. 2015(d)(2)(A)) is amended by striking

24 ‘‘that is comparable to a requirement of paragraph (1)’’.
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1 SEC. 1414. COOPERATION WITH CHILD SUPPORT AGENCIES.

2 Section 6 of the Food Stamp Act of 1977 (7 U.S.C.

3 2015) (as amended by section 1413) is further amended by

4 adding at the end the following:

5 ‘‘(j) CUSTODIAL PARENT’S COOPERATION WITH CHILD

6 SUPPORT AGENCIES.—

7 ‘‘(1) IN GENERAL.—At the option of a State

8 agency, subject to paragraphs (2) and (3), no natural

9 or adoptive parent or other individual (collectively re10 ferred to in this subsection as ‘the individual’) who is

11 living with and exercising parental control over a

12 child under the age of 18 who has an absent parent

13 shall be eligible to participate in the food stamp pro14 gram unless the individual cooperates with the State

15 agency administering the program established under

16 part D of title IV of the Social Security Act (42

17 U.S.C. 651 et seq.)—

18 ‘‘(A) in establishing the paternity of the

19 child (if the child is born out of wedlock); and

20 ‘‘(B) in obtaining support for—

21 ‘‘(i) the child; or

22 ‘‘(ii) the individual and the child.

23 ‘‘(2) GOOD CAUSE FOR NONCOOPERATION.—

24 Paragraph (1) shall not apply to the individual if

25 good cause is found for refusing to cooperate, as deter26 mined by the State agency in accordance with stand-
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1 ards prescribed by the Secretary in consultation with

2 the Secretary of Health and Human Services. The

3 standards shall take into consideration circumstances

4 under which cooperation may be against the best in5 terests of the child.

6 ‘‘(3) FEES.—Paragraph (1) shall not require the

7 payment of a fee or other cost for services provided

8 under part D of title IV of the Social Security Act

9 (42 U.S.C. 651 et seq.).’’.

10 SEC. 1415. DISQUALIFICATION FOR CHILD SUPPORT AR11 REARS.

12 Section 6 of the Food Stamp Act of 1977 (7 U.S.C.

13 2015) (as amended by section 1414) is further amended by

14 adding at the end the following:

15 ‘‘(k) DISQUALIFICATION FOR CHILD SUPPORT AR16 REARS.—

17 ‘‘(1) IN GENERAL.—At the option of a State

18 agency, except as provided in paragraph (2), no indi19 vidual shall be eligible to participate in the food

20 stamp program as a member of any household during

21 any month that the individual is delinquent in any

22 payment due under a court order for the support of

23 a child of the individual.

24 ‘‘(2) EXCEPTIONS.—Paragraph (1) shall not

25 apply if—
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1 ‘‘(A) a court is allowing the individual to

2 delay payment; or

3 ‘‘(B) the individual is complying with a

4 payment plan approved by a court or the State

5 agency designated under part D of title IV of the

6 Social Security Act (42 U.S.C. 651 et seq.) to

7 provide support for the child of the individual.’’.

8 SEC. 1416. PERMANENT DISQUALIFICATION FOR PARTICI9 PATING IN 2 OR MORE STATES.

10 Section 6 of the Food Stamp Act of 1977 (7 U.S.C.

11 2015) (as amended by section 1415) is further amended by

12 adding at the end the following:

13 ‘‘(l) PERMANENT DISQUALIFICATION FOR PARTICIPAT14 ING IN 2 OR MORE STATES.—An individual shall be perma15 nently ineligible to participate in the food stamp program

16 as a member of any household if the individual is found

17 by a State agency to have made, or is convicted in Federal

18 or State court of having made, a fraudulent statement or

19 representation with respect to the place of residence of the

20 individual in order to receive benefits simultaneously from

21 2 or more States under the food stamp program.’’.

22 SEC. 1417. WORK REQUIREMENT.

23 (a) IN GENERAL.—Section 6 of the Food Stamp Act

24 of 1977 (7 U.S.C. 2015) (as amended by section 1416) is

25 further amended by adding at the end the following:
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1 ‘‘(m) WORK REQUIREMENT.—

2 ‘‘(1) DEFINITION OF WORK PROGRAM.—In this

3 subsection, the term ‘work program’ means—

4 ‘‘(A) a program under the Job Training

5 Partnership Act (29 U.S.C. 1501 et seq.);

6 ‘‘(B) a program under section 236 of the

7 Trade Act of 1974 (19 U.S.C. 2296); or

8 ‘‘(C) a program of employment or training

9 operated or supervised by a State or political

10 subdivision of a State that meets standards ap11 proved by the Governor of the State, including a

12 program under subsection (d)(4) other than a job

13 search program or a job search training program

14 under clause (i) or (ii) of subsection (d)(4)(B).

15 ‘‘(2) WORK REQUIREMENT.—Except as otherwise

16 provided in this subsection, no individual shall be eli17 gible to participate in the food stamp program as a

18 member of any household if, during the preceding 12-

19 month period, the individual received food stamp ben20 efits for not less than 6 months during which the in21 dividual did not—

22 ‘‘(A) work 20 hours or more per week, aver23 aged monthly; or

24 ‘‘(B) participate in and comply with the re25 quirements of a work program for 20 hours or
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1 more per week, as determined by the State agen2 cy.

3 ‘‘(3) EXCEPTIONS.—Paragraph (2) shall not

4 apply to an individual if the individual is—

5 ‘‘(A) under 18 or over 50 years of age;

6 ‘‘(B) medically certified as physically or

7 mentally unfit for employment;

8 ‘‘(C) a parent or other member of a house9 hold with responsibility for a dependent child; or

10 ‘‘(D) otherwise exempt under subsection

11 (d)(2).

12 ‘‘(4) WAIVER.—On the request of a State agency,

13 the Secretary may waive the applicability of para14 graph (2) to any group of individuals in the State if

15 the Secretary makes a determination that the area in

16 which the individuals reside—

17 ‘‘(A) has an unemployment rate of over 8

18 percent; or

19 ‘‘(B) does not have a sufficient number of

20 jobs to provide employment for the individuals.’’.

21 (b) TRANSITION PROVISION.—Prior to October 1,

22 1996, the term ‘‘preceding 12-month period’’ in section

23 6(m)(2) of the Food Stamp Act of 1977 (as added by sub24 section (a)) means the preceding period that begins on Octo25 ber 1, 1995.
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1 SEC. 1418. DISQUALIFICATION OF FLEEING FELONS.

2 Section 6 of the Food Stamp Act of 1977 (7 U.S.C.

3 2015) (as amended by section 1417) is further amended by

4 adding at the end the following:

5 ‘‘(n) DISQUALIFICATION OF FLEEING FELONS.—No

6 member of a household who is otherwise eligible to partici7 pate in the food stamp program shall be eligible to partici8 pate in the program as a member of that or any other

9 household during any period during which the individual

10 is—

11 ‘‘(1) fleeing to avoid prosecution, or custody or

12 confinement after conviction, under the laws of the

13 place from which the individual flees, for a crime, or

14 attempt to commit a crime, which is a felony under

15 the laws of the place from which the individual flees,

16 or which, in the case of the State of New Jersey, is

17 a high misdemeanor under the laws of the State; or

18 ‘‘(2) violating a condition of probation or parole

19 imposed under a Federal or State law.’’.

20 SEC. 1419. ELECTRONIC BENEFIT TRANSFERS.

21 Section 7 of the Food Stamp Act of 1977 (7 U.S.C.

22 2016) is amended by adding at the end the following:

23 ‘‘(j) ELECTRONIC BENEFIT TRANSFERS.—

24 ‘‘(1) APPLICABLE LAW.—

25 ‘‘(A) IN GENERAL.—Disclosures, protections,

26 responsibilities, and remedies established by the
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1 Federal Reserve Board under section 904 of the

2 Electronic Fund Transfer Act (15 U.S.C. 1693b)

3 shall not apply to benefits under this Act deliv4 ered through any electronic benefit transfer sys5 tem.

6 ‘‘(B) DEFINITION OF ELECTRONIC BENEFIT

7 TRANSFER SYSTEM.—In this paragraph, the

8 term ‘electronic benefit transfer system’ means a

9 system under which a governmental entity dis10 tributes benefits under this Act or other benefits

11 or payments by establishing accounts to be

12 accessed by recipients of the benefits electroni13 cally, including through the use of an automated

14 teller machine, a point-of-sale terminal, or an

15 intelligent benefit card.

16 ‘‘(2) CHARGING FOR ELECTRONIC BENEFIT

17 TRANSFER CARD REPLACEMENT.—

18 ‘‘(A) IN GENERAL.—A State agency may

19 charge an individual for the cost of replacing a

20 lost or stolen electronic benefit transfer card.

21 ‘‘(B) REDUCING ALLOTMENT.—A State

22 agency may collect a charge imposed under sub23 paragraph (A) by reducing the monthly allot24 ment of the household of which the individual is

25 a member.’’.
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1 SEC. 1420. MINIMUM BENEFIT.

2 The proviso in section 8(a) of the Food Stamp Act of

3 1977 (7 U.S.C. 2017(a)) is amended by striking ‘‘, and shall

4 be adjusted’’ and all that follows through ‘‘$5’’.

5 SEC. 1421. BENEFITS ON RECERTIFICATION.

6 Section 8(c)(2)(B) of the Food Stamp Act of 1977 (7

7 U.S.C. 2017(c)(2)(B)) is amended by striking ‘‘of more than

8 one month’’.

9 SEC. 1422. FAILURE TO COMPLY WITH OTHER WELFARE

10 AND PUBLIC ASSISTANCE PROGRAMS.

11 Section 8 of the Food Stamp Act of 1977 (7 U.S.C.

12 2017) is amended by striking subsection (d) and inserting

13 the following:

14 ‘‘(d) REDUCTION OF PUBLIC ASSISTANCE BENE15 FITS.—If the benefits of a household are reduced under a

16 Federal, State, or local law relating to a welfare or public

17 assistance program for the failure to perform an action re18 quired under the law or program, for the duration of the

19 reduction—

20 ‘‘(1) the household may not receive an increased

21 allotment as the result of a decrease in the income of

22 the household to the extent that the decrease is the re23 sult of the reduction; and

24 ‘‘(2) the State agency may reduce the allotment

25 of the household by not more than 25 percent.’’.
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1 SEC. 1423. ALLOTMENTS FOR HOUSEHOLDS RESIDING IN

2 INSTITUTIONS.

3 Section 8 of the Food Stamp Act of 1977 (7 U.S.C.

4 2017) is amended by adding at the end the following:

5 ‘‘(f) ALLOTMENTS FOR HOUSEHOLDS RESIDING IN IN6 STITUTIONS.—In the case of an individual who resides in

7 a homeless shelter, or in an institution or center for the

8 purpose of a drug or alcoholic treatment program, described

9 in the last sentence of section 3(i), a State agency may pro10 vide an allotment for the individual to—

11 ‘‘(1) the institution as an authorized representa12 tive for the individual for a period that is less than

13 1 month; and

14 ‘‘(2) the individual, if the individual leaves the

15 institution.’’.

16 SEC. 1424. COLLECTION OF OVERISSUANCES.

17 (a) IN GENERAL.—Section 13 of the Food Stamp Act

18 of 1977 (7 U.S.C. 2022) is amended—

19 (1) by striking subsection (b) and inserting the

20 following:

21 ‘‘(b) COLLECTION OF OVERISSUANCES.—

22 ‘‘(1) IN GENERAL.—Except as otherwise provided

23 in this subsection, a State agency shall collect any

24 overissuance of coupons issued to a household by—

25 ‘‘(A) reducing the allotment of the house26 hold;
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1 ‘‘(B) withholding unemployment compensa2 tion from a member of the household under sub3 section (c);

4 ‘‘(C) recovering from Federal pay or a Fed5 eral income tax refund under subsection (d); or

6 ‘‘(D) any other means.

7 ‘‘(2) COST EFFECTIVENESS.—Paragraph (1)

8 shall not apply if the State agency demonstrates to

9 the satisfaction of the Secretary that all of the means

10 referred to in paragraph (1) are not cost effective.

11 ‘‘(3) HARDSHIPS.—A State agency may not use

12 an allotment reduction under paragraph (1)(A) as a

13 means of collecting an overissuance from a household

14 if the allotment reduction would cause a hardship on

15 the household, as determined by the State agency.

16 ‘‘(4) MAXIMUM REDUCTION ABSENT FRAUD.—If

17 a household received an overissuance of coupons with18 out any member of the household being found ineli19 gible to participate in the program under section

20 6(b)(1) and a State agency elects to reduce the allot21 ment of the household under paragraph (1)(A), the

22 State agency shall reduce the monthly allotment of the

23 household under paragraph (1)(A) by the greater of—

24 ‘‘(A) 10 percent of the monthly allotment of

25 the household; or
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1 ‘‘(B) $10.

2 ‘‘(5) PROCEDURES.—A State agency shall collect

3 an overissuance of coupons issued to a household

4 under paragraph (1) in accordance with requirements

5 established by the State agency for providing notice,

6 electing a means of payment, and establishing a time

7 schedule for payment.’’; and

8 (2) in subsection (d)—

9 (A) by striking ‘‘as determined under sub10 section (b) and except for claims arising from an

11 error of the State agency,’’ and inserting ‘‘, as

12 determined under subsection (b)(1),’’; and

13 (B) by inserting before the period at the end

14 the following: ‘‘or a Federal income tax refund as

15 authorized by section 3720A of title 31, United

16 States Code’’.

17 (b) CONFORMING AMENDMENT.—Section 11(e)(8) of

18 the Act (7 U.S.C. 2020(e)(8)) is amended—

19 (1) by striking ‘‘and excluding claims’’ and all

20 that follows through ‘‘such section’’; and

21 (2) by inserting before the semicolon at the end

22 the following: ‘‘or a Federal income tax refund as au23 thorized by section 3720A of title 31, United States

24 Code’’.
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1 SEC. 1425. TERMINATION OF FEDERAL MATCH FOR OP2 TIONAL INFORMATION ACTIVITIES.

3 (a) IN GENERAL.—Section 16(a) of the Food Stamp

4 Act of 1977 (7 U.S.C. 2025(a)) is amended—

5 (1) by striking paragraph (4); and

6 (2) by redesignating paragraphs (5) through (8)

7 as paragraphs (4) through (7), respectively.

8 (b) CONFORMING AMENDMENT.—Section 16(g) of the

9 Act (7 U.S.C. 2025(g)) is amended by striking ‘‘an amount

10 equal to’’ and all that follows through ‘‘1991, of’’ and insert11 ing ‘‘the amount provided under subsection (a)(5) for’’.

12 SEC. 1426. WORK SUPPLEMENTATION OR SUPPORT PRO13 GRAM.

14 Section 16 of the Food Stamp Act of 1977 (7 U.S.C.

15 2025) is amended by adding at the end the following:

16 ‘‘(k) WORK SUPPLEMENTATION OR SUPPORT PRO17 GRAM.—

18 ‘‘(1) DEFINITION.—In this subsection, the term

19 ‘work supplementation or support program’ means a

20 program in which, as determined by the Secretary,

21 public assistance (including any benefits provided

22 under a program established by the State and the food

23 stamp program) is provided to an employer to be

24 used for hiring and employing a new employee who

25 is a public assistance recipient.
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1 ‘‘(2) PROGRAM.—A State agency may elect to

2 use amounts equal to the allotment that would other3 wise be allotted to a household under the food stamp

4 program, but for the operation of this subsection, for

5 the purpose of subsidizing or supporting jobs under a

6 work supplementation or support program established

7 by the State.

8 ‘‘(3) PROCEDURE.—If a State agency makes an

9 election under paragraph (2) and identifies each

10 household that participates in the food stamp pro11 gram that contains an individual who is participat12 ing in the work supplementation or support pro13 gram—

14 ‘‘(A) the Secretary shall pay to the State

15 agency an amount equal to the value of the allot16 ment that the household would be eligible to re17 ceive but for the operation of this subsection;

18 ‘‘(B) the State agency shall expend the

19 amount paid under subparagraph (A) in accord20 ance with the work supplementation or support

21 program in lieu of providing the allotment that

22 the household would receive but for the operation

23 of this subsection;

24 ‘‘(C) for purposes of—
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1 ‘‘(i) sections 5 and 8(a), the amount

2 received under this subsection shall be ex3 cluded from household income and resources;

4 and

5 ‘‘(ii) section 8(b), the amount received

6 under this subsection shall be considered to

7 be the value of an allotment provided to the

8 household; and

9 ‘‘(D) the household shall not receive an al10 lotment from the State agency for the period

11 during which the member continues to partici12 pate in the work supplementation or support

13 program.

14 ‘‘(4) MAXIMUM LENGTH OF PARTICIPATION.—A

15 work supplementation or support program may not

16 allow the participation of any individual for longer

17 than 1 year, unless the Secretary approves a longer

18 period.’’.

19 SEC. 1427. PRIVATE SECTOR EMPLOYMENT INITIATIVES.

20 Section 17 of the Food Stamp Act of 1977 (7 U.S.C.

21 2026) is amended by adding at the end the following:

22 ‘‘(m) PRIVATE SECTOR EMPLOYMENT INITIATIVES.—

23 ‘‘(1) ELECTION TO PARTICIPATE.—

24 ‘‘(A) IN GENERAL.—Subject to the other

25 provisions of this subsection, a State may elect
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1 to carry out a private sector employment initia2 tive program under this subsection.

3 ‘‘(B) REQUIREMENT.—A State shall be eli4 gible to carry out a private sector employment

5 initiative under this subsection only if not less

6 than 50 percent of the households that received

7 food stamp benefits during the summer of 1993

8 also received benefits under a State program

9 funded under part A of title IV of the Social Se10 curity Act (42 U.S.C. 601 et seq.) during the

11 summer of 1993.

12 ‘‘(2) PROCEDURE.—A State that has elected to

13 carry out a private sector employment initiative

14 under paragraph (1) may use amounts equal to the

15 food stamp allotments that would otherwise be allotted

16 to a household under the food stamp program, but for

17 the operation of this subsection, to provide cash bene18 fits in lieu of the food stamp allotments to the house19 hold if the household is eligible under paragraph (3).

20 ‘‘(3) ELIGIBILITY.—A household shall be eligible

21 to receive cash benefits under paragraph (2) if an

22 adult member of the household—

23 ‘‘(A) has worked in unsubsidized employ24 ment in the private sector for not less than the

25 preceding 90 days;
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1 ‘‘(B) has earned not less than $350 per

2 month from the employment referred to in sub3 paragraph (A) for not less than the preceding 90

4 days;

5 ‘‘(C)(i) is eligible to receive benefits under a

6 State program funded under part A of title IV

7 of the Social Security Act (42 U.S.C. 601 et

8 seq.); or

9 ‘‘(ii) was eligible to receive benefits under a

10 State program funded under part A of title IV

11 of the Social Security Act (42 U.S.C. 601 et seq.)

12 at the time the member first received cash bene13 fits under this subsection and is no longer eligi14 ble for the State program because of earned in15 come;

16 ‘‘(D) is continuing to earn not less than

17 $350 per month from the employment referred to

18 in subparagraph (A); and

19 ‘‘(E) elects to receive cash benefits in lieu of

20 food stamp benefits under this subsection.’’.

21 SEC. 1428. REAUTHORIZATION OF APPROPRIATIONS.

22 The first sentence of section 18(a)(1) of the Food

23 Stamp Act of 1977 (7 U.S.C. 2027(a)(1)) is amended by

24 striking ‘‘1995’’ and inserting ‘‘2002’’.
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1 SEC. 1429. OPTIONAL STATE FOOD ASSISTANCE BLOCK

2 GRANT.

3 The Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.)

4 is amended by adding at the end the following:

5 ‘‘SEC. 24. OPTIONAL STATE FOOD ASSISTANCE BLOCK

6 GRANT.

7 ‘‘(a) ESTABLISHMENT.—The Secretary shall establish

8 a program to make grants to States in accordance with this

9 section to provide—

10 ‘‘(1) food assistance to needy individuals and

11 families residing in the State;

12 ‘‘(2) at the option of a State, wage subsidies and

13 payments in return for work for needy individuals

14 under the program;

15 ‘‘(3) funds to operate an employment and train16 ing program under subsection (g)(2) for needy indi17 viduals under the program; and

18 ‘‘(4) funds for administrative costs incurred in

19 providing the assistance.

20 ‘‘(b) ELECTION.—

21 ‘‘(1) IN GENERAL.—A State may elect to partici22 pate in the program established under subsection (a).

23 ‘‘(2) ELECTION REVOCABLE.—A State that elects

24 to participate in the program established under sub25 section (a) may subsequently reverse the election of

26 the State only once thereafter. Following the reversal,
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1 the State shall only be eligible to participate in the

2 food stamp program in accordance with the other sec3 tions of this Act and shall not receive a block grant

4 under this section.

5 ‘‘(3) PROGRAM EXCLUSIVE.—A State that is par6 ticipating in the program established under sub7 section (a) shall not be subject to, or receive any bene8 fit under, this Act except as provided in this section.

9 ‘‘(c) LEAD AGENCY.—

10 ‘‘(1) DESIGNATION.—A State desiring to partici11 pate in the program established under this section

12 shall designate, in an application submitted to the

13 Secretary under subsection (d)(1), an appropriate

14 State agency that complies with paragraph (2) to act

15 as the lead agency for the State.

16 ‘‘(2) DUTIES.—The lead agency shall—

17 ‘‘(A) administer, either directly, through

18 other State agencies, or through local agencies,

19 the assistance received under this section by the

20 State;

21 ‘‘(B) develop the State plan to be submitted

22 to the Secretary under subsection (d)(1); and

23 ‘‘(C) coordinate the provision of food assist24 ance under this section with other Federal, State,

25 and local programs.
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1 ‘‘(d) APPLICATION AND PLAN.—

2 ‘‘(1) APPLICATION.—To be eligible to receive as3 sistance under this section, a State shall prepare and

4 submit to the Secretary an application at such time,

5 in such manner, and containing such information as

6 the Secretary shall by regulation require, including—

7 ‘‘(A) an assurance that the State will com8 ply with the requirements of this section;

9 ‘‘(B) a State plan that meets the require10 ments of paragraph (3); and

11 ‘‘(C) an assurance that the State will com12 ply with the requirements of the State plan

13 under paragraph (3).

14 ‘‘(2) ANNUAL PLAN.—The State plan contained

15 in the application under paragraph (1) shall be sub16 mitted for approval annually.

17 ‘‘(3) REQUIREMENTS OF PLAN.—

18 ‘‘(A) LEAD AGENCY.—The State plan shall

19 identify the lead agency.

20 ‘‘(B) USE OF BLOCK GRANT FUNDS.—The

21 State plan shall provide that the State shall use

22 the amounts provided to the State for each fiscal

23 year under this section—

24 ‘‘(i) to provide food assistance to needy

25 individuals and families residing in the
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1 State, other than residents of institutions

2 who are ineligible for food stamps under

3 section 3(i);

4 ‘‘(ii) at the option of a State, to pro5 vide wage subsidies or workfare under sec6 tion 20(a) (except that any reference in sec7 tion 20(a) to an allotment shall be consid8 ered a reference to the food assistance or

9 benefits in lieu of food assistance received

10 by an individual or family during a month

11 under this section) for needy individuals

12 and families participating in the program;

13 ‘‘(iii) to administer an employment

14 and training program under subsection

15 (g)(2) for needy individuals under the pro16 gram and to provide reimbursements to

17 needy individuals and families as would be

18 allowed under section 16(h)(3); and

19 ‘‘(iv) to pay administrative costs in20 curred in providing the assistance.

21 ‘‘(C) ASSISTANCE FOR ENTIRE STATE.—The

22 State plan shall provide that benefits under this

23 section shall be available throughout the entire

24 State.
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1 ‘‘(D) NOTICE AND HEARINGS.—The State

2 plan shall provide that an individual or family

3 who applies for, or receives, assistance under this

4 section shall be provided with notice of, and an

5 opportunity for a hearing on, any action under

6 this section that adversely affects the individual

7 or family.

8 ‘‘(E) OTHER ASSISTANCE.—

9 ‘‘(i) COORDINATION.—The State plan

10 may coordinate assistance received under

11 this section with assistance provided under

12 the State program funded under part A of

13 title IV of the Social Security Act (42

14 U.S.C. 601 et seq.).

15 ‘‘(ii) PENALTIES.—If an individual or

16 family is penalized for violating part A of

17 title IV of the Act, the State plan may re18 duce the amount of assistance provided

19 under this section or otherwise penalize the

20 individual or family.

21 ‘‘(F) ELIGIBILITY LIMITATIONS.—The State

22 plan shall describe the income and resource eligi23 bility limitations that are established for the re24 ceipt of assistance under this section.
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1 ‘‘(G) RECEIVING BENEFITS IN MORE THAN 1

2 JURISDICTION.—The State plan shall establish a

3 system to verify and otherwise ensure that no in4 dividual or family shall receive benefits under

5 this section in more than 1 jurisdiction within

6 the State.

7 ‘‘(H) PRIVACY.—The State plan shall pro8 vide for safeguarding and restricting the use and

9 disclosure of information about any individual

10 or family receiving assistance under this section.

11 ‘‘(I) OTHER INFORMATION.—The State plan

12 shall contain such other information as may be

13 required by the Secretary.

14 ‘‘(4) APPROVAL OF APPLICATION AND PLAN.—

15 The Secretary shall approve an application and State

16 plan that satisfies the requirements of this section.

17 ‘‘(e) LIMITATIONS ON STATE ALLOTMENTS.—

18 ‘‘(1) NO INDIVIDUAL OR FAMILY ENTITLEMENT

19 TO ASSISTANCE.—Nothing in this section—

20 ‘‘(A) entitles any individual or family to

21 assistance under this section; or

22 ‘‘(B) limits the right of a State to impose

23 additional limitations or conditions on assist24 ance under this section.
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1 ‘‘(2) CONSTRUCTION OF FACILITIES.—No funds

2 made available under this section shall be expended

3 for the purchase or improvement of land, or for the

4 purchase, construction, or permanent improvement of

5 any building or facility.

6 ‘‘(f) BENEFITS FOR ALIENS.—

7 ‘‘(1) ELIGIBILITY.—No individual shall be eligi8 ble to receive benefits under a State plan approved

9 under subsection (d)(4) if the individual is not eligi10 ble to participate in the food stamp program under

11 section 6(f).

12 ‘‘(2) INCOME.—The State plan shall provide that

13 the income of an alien shall be determined in accord14 ance with section 5(i).

15 ‘‘(g) EMPLOYMENT AND TRAINING.—

16 ‘‘(1) WORK REQUIREMENTS.—No individual or

17 member of a family shall be eligible to receive benefits

18 under a State plan funded under this section if the

19 individual is not eligible to participate in the food

20 stamp program under subsection (d) or (m) of section

21 6.

22 ‘‘(2) WORK PROGRAMS.—Each State shall imple23 ment an employment and training program described

24 in section 6(d)(4) for needy individuals under the

25 program.
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1 ‘‘(h) ENFORCEMENT.—

2 ‘‘(1) REVIEW OF COMPLIANCE WITH STATE

3 PLAN.—The Secretary shall review and monitor State

4 compliance with this section and the State plan ap5 proved under subsection (d)(4).

6 ‘‘(2) NONCOMPLIANCE.—

7 ‘‘(A) IN GENERAL.—If the Secretary, after

8 reasonable notice to a State and opportunity for

9 a hearing, finds that—

10 ‘‘(i) there has been a failure by the

11 State to comply substantially with any pro12 vision or requirement set forth in the State

13 plan approved under subsection (d)(4); or

14 ‘‘(ii) in the operation of any program

15 or activity for which assistance is provided

16 under this section, there is a failure by the

17 State to comply substantially with any pro18 vision of this section;

19 the Secretary shall notify the State of the finding

20 and that no further payments will be made to

21 the State under this section (or, in the case of

22 noncompliance in the operation of a program or

23 activity, that no further payments to the State

24 will be made with respect to the program or ac25 tivity) until the Secretary is satisfied that there
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1 is no longer any failure to comply or that the

2 noncompliance will be promptly corrected.

3 ‘‘(B) OTHER SANCTIONS.—In the case of a

4 finding of noncompliance made pursuant to sub5 paragraph (A), the Secretary may, in addition

6 to, or in lieu of, imposing the sanctions described

7 in subparagraph (A), impose other appropriate

8 sanctions, including recoupment of money im9 properly expended for purposes prohibited or not

10 authorized by this section and disqualification

11 from the receipt of financial assistance under

12 this section.

13 ‘‘(C) NOTICE.—The notice required under

14 subparagraph (A) shall include a specific identi15 fication of any additional sanction being im16 posed under subparagraph (B).

17 ‘‘(3) ISSUANCE OF REGULATIONS.—The Sec18 retary shall establish by regulation procedures for—

19 ‘‘(A) receiving, processing, and determining

20 the validity of complaints concerning any failure

21 of a State to comply with the State plan or any

22 requirement of this section; and

23 ‘‘(B) imposing sanctions under this section.

24 ‘‘(4) INCOME AND ELIGIBILITY VERIFICATION

25 SYSTEM.—The Secretary may withhold not more than
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1 5 percent of the amount allotted to a State under sub2 section (l)(2) if the State does not use an income and

3 eligibility verification system established under sec4 tion 1137 of the Social Security Act (42 U.S.C.

5 1320b–7).

6 ‘‘(i) PAYMENTS.—

7 ‘‘(1) IN GENERAL.—For each fiscal year, the Sec8 retary shall pay to a State that has an application

9 approved by the Secretary under subsection (d)(4) an

10 amount that is equal to the allotment of the State

11 under subsection (l)(2) for the fiscal year.

12 ‘‘(2) METHOD OF PAYMENT.—The Secretary shall

13 make payments to a State for a fiscal year under this

14 section by issuing 1 or more letters of credit for the

15 fiscal year, with necessary adjustments on account of

16 overpayments or underpayments, as determined by

17 the Secretary.

18 ‘‘(3) SPENDING OF FUNDS BY STATE.—

19 ‘‘(A) IN GENERAL.—Except as provided in

20 subparagraph (B), payments to a State from an

21 allotment under subsection (l)(2) for a fiscal

22 year may be expended by the State only in the

23 fiscal year.

24 ‘‘(B) CARRYOVER.—The State may reserve

25 up to 10 percent of an allotment under sub-
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1 section (l)(2) for a fiscal year to provide assist2 ance under this section in subsequent fiscal

3 years, except that the reserved funds may not ex4 ceed 30 percent of the total allotment received

5 under this section for a fiscal year.

6 ‘‘(4) FOOD ASSISTANCE AND ADMINISTRATIVE

7 EXPENDITURES.—In each fiscal year, of the Federal

8 funds expended by a State under this section—

9 ‘‘(A) not less than 80 percent shall be for

10 food assistance; and

11 ‘‘(B) not more than 6 percent shall be for

12 administrative expenses.

13 ‘‘(5) PROVISION OF FOOD ASSISTANCE.—A State

14 may provide food assistance under this section in any

15 manner determined appropriate by the State to pro16 vide food assistance to needy individuals and families

17 in the State, such as electronic benefits transfer lim18 ited to food purchases, coupons limited to food pur19 chases, or direct provision of commodities.

20 ‘‘(6) DEFINITION OF FOOD ASSISTANCE.—In this

21 section, the term ‘food assistance’ means assistance

22 that may be used only to obtain food, as defined in

23 section 3(g).

24 ‘‘(j) AUDITS.—
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1 ‘‘(1) REQUIREMENT.—After the close of each fis2 cal year, a State shall arrange for an audit of the ex3 penditures of the State during the program period

4 from amounts received under this section.

5 ‘‘(2) INDEPENDENT AUDITOR.—An audit under

6 this section shall be conducted by an entity that is

7 independent of any agency administering activities

8 that receive assistance under this section and be in

9 accordance with generally accepted auditing prin10 ciples.

11 ‘‘(3) PAYMENT ACCURACY.—Each annual audit

12 under this section shall include an audit of payment

13 accuracy under this section that shall be based on a

14 statistically valid sample of the caseload in the State.

15 ‘‘(4) SUBMISSION.—Not later than 30 days after

16 the completion of an audit under this section, the

17 State shall submit a copy of the audit to the legisla18 ture of the State and to the Secretary.

19 ‘‘(5) REPAYMENT OF AMOUNTS.—Each State

20 shall repay to the United States any amounts deter21 mined through an audit under this section to have

22 not been expended in accordance with this section or

23 to have not been expended in accordance with the

24 State plan, or the Secretary may offset the amounts
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1 against any other amount paid to the State under

2 this section.

3 ‘‘(k) NONDISCRIMINATION.—

4 ‘‘(1) IN GENERAL.—The Secretary shall not pro5 vide financial assistance for any program, project, or

6 activity under this section if any person with respon7 sibilities for the operation of the program, project, or

8 activity discriminates with respect to the program,

9 project, or activity because of race, religion, color, na10 tional origin, sex, or disability.

11 ‘‘(2) ENFORCEMENT.—The powers, remedies, and

12 procedures set forth in title VI of the Civil Rights Act

13 of 1964 (42 U.S.C. 2000d et seq.) may be used by the

14 Secretary to enforce paragraph (1).

15 ‘‘(l) ALLOTMENTS.—

16 ‘‘(1) DEFINITION OF STATE.—In this section, the

17 term ‘State’ means each of the 50 States, the District

18 of Columbia, Guam, and the Virgin Islands of the

19 United States.

20 ‘‘(2) STATE ALLOTMENT.—

21 ‘‘(A) IN GENERAL.—Except as provided in

22 subparagraph (B), from the amounts made

23 available under section 18 of this Act for each

24 fiscal year, the Secretary shall allot to each State

25 participating in the program established under
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1 this section an amount that is equal to the sum

2 of—

3 ‘‘(i) the greater of, as determined by

4 the Secretary—

5 ‘‘(I) the total dollar value of all

6 benefits issued under the food stamp

7 program established under this Act by

8 the State during fiscal year 1994; or

9 ‘‘(II) the average per fiscal year of

10 the total dollar value of all benefits is11 sued under the food stamp program by

12 the State during each of fiscal years

13 1992 through 1994; and

14 ‘‘(ii) the greater of, as determined by

15 the Secretary—

16 ‘‘(I) the total amount received by

17 the State for administrative costs and

18 the employment and training program

19 under subsections (a) and (h), respec20 tively, of section 16 of this Act for fis21 cal year 1994; or

22 ‘‘(II) the average per fiscal year of

23 the total amount received by the State

24 for administrative costs and the em25 ployment and training program under
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1 subsections (a) and (h), respectively, of

2 section 16 of this Act for each of fiscal

3 years 1992 through 1994.

4 ‘‘(B) INSUFFICIENT FUNDS.—If the Sec5 retary finds that the total amount of allotments

6 to which States would otherwise be entitled for a

7 fiscal year under subparagraph (A) will exceed

8 the amount of funds that will be made available

9 to provide the allotments for the fiscal year, the

10 Secretary shall reduce the allotments made to

11 States under this subsection, on a pro rata basis,

12 to the extent necessary to allot under this sub13 section a total amount that is equal to the funds

14 that will be made available.’’.

15 SEC. 1430. EFFECTIVE DATE.

16 Except as otherwise provided in this chapter, this

17 chapter and the amendments made by this chapter shall be18 come effective on October 1, 1995.
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1 CHAPTER 2—CHILD NUTRITION

2 PROGRAMS

3 PART I—REIMBURSEMENT RATES

4 SEC. 1441. TERMINATION OF ADDITIONAL PAYMENT FOR

5 LUNCHES SERVED IN HIGH FREE AND RE6 DUCED PRICE PARTICIPATION SCHOOLS.

7 (a) IN GENERAL.—Section 4(b)(2) of the National

8 School Lunch Act (42 U.S.C. 1753(b)(2)) is amended by

9 striking ‘‘except that’’ and all that follows through ‘‘2 cents

10 more’’.

11 (b) EFFECTIVE DATE.—The amendment made by sub12 section (a) shall become effective on July 1, 1996.

13 SEC. 1442. LUNCHES, BREAKFASTS, AND SUPPLEMENTS.

14 (a) IN GENERAL.—Section 11(a)(3)(B) of the National

15 School Lunch Act (42 U.S.C. 1759a(a)(3)(B)) is amend16 ed—

17 (1) by designating the second and third sentences

18 as subparagraphs (C) and (D), respectively; and

19 (2) by striking subparagraph (D) (as so des20 ignated) and inserting the following:

21 ‘‘(D) ROUNDING.—Except as otherwise pro22 vided in this paragraph, in the case of each

23 school year, the Secretary shall—

24 ‘‘(i) base the adjustment made under

25 this paragraph on the amount of the
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1 unrounded adjustment for the preceding

2 school year;

3 ‘‘(ii) adjust the resulting amount in

4 accordance with subparagraphs (B) and

5 (C); and

6 ‘‘(iii) round the result to the nearest

7 lower cent increment.

8 ‘‘(E) ADJUSTMENT ON JANUARY 1, 1996.—

9 On January 1, 1996, the Secretary shall adjust

10 the rates and factor for the remainder of the

11 school year by rounding the previously estab12 lished rates and factor to the nearest lower cent

13 increment.

14 ‘‘(F) ADJUSTMENT FOR 24-MONTH PERIOD

15 BEGINNING JULY 1, 1996.—In the case of the 24-

16 month period beginning July 1, 1996, the na17 tional average payment rates for paid lunches,

18 paid breakfasts, and paid supplements shall be

19 the same as the national average payment rate

20 for paid lunches, paid breakfasts, and paid sup21 plements, respectively, for the school year begin22 ning July 1, 1995, rounded to the nearest lower

23 cent increment.

24 ‘‘(G) ADJUSTMENT FOR SCHOOL YEAR BE25 GINNING JULY 1, 1998.—In the case of the school
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1 year beginning July 1, 1998, the Secretary

2 shall—

3 ‘‘(i) base the adjustments made under

4 this paragraph for—

5 ‘‘(I) paid lunches and paid break6 fasts on the amount of the unrounded

7 adjustment for paid lunches for the

8 school year beginning July 1, 1995;

9 and

10 ‘‘(II) paid supplements on the

11 amount of the unrounded adjustment

12 for paid supplements for the school

13 year beginning July 1, 1995;

14 ‘‘(ii) adjust each resulting amount in

15 accordance with subparagraph (C); and

16 ‘‘(iii) round each result to the nearest

17 lower cent increment.’’.

18 (b) EFFECTIVE DATE.—The amendments made by sub19 section (a) shall become effective on January 1, 1996.

20 SEC. 1443. FREE AND REDUCED PRICE BREAKFASTS.

21 (a) IN GENERAL.—Section 4(b) of the Child Nutrition

22 Act of 1966 (42 U.S.C. 1773(b)) is amended—

23 (1) in paragraph (1)(B)—
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1 (A) in the first sentence, by striking ‘‘sec2 tion 11(a)’’ and inserting ‘‘subparagraphs (B)

3 through (E) of section 11(a)(3)’’; and

4 (B) in the second sentence, by striking ‘‘,

5 adjusted to the nearest one-fourth cent’’ and in6 serting ‘‘(as adjusted pursuant to subparagraphs

7 (B) through (E) of section 11(a)(3) of the Na8 tional School Lunch Act (42 U.S.C.

9 1759a(a)(3)))’’; and

10 (2) in paragraph (2)(B)(ii)—

11 (A) by striking ‘‘nearest one-fourth cent’’

12 and inserting ‘‘nearest lower cent increment for

13 the applicable school year’’; and

14 (B) by inserting before the period at the end

15 the following: ‘‘, and the adjustment required by

16 this clause shall be based on the unrounded ad17 justment for the preceding school year’’.

18 (b) EFFECTIVE DATE.—The amendments made by sub19 section (a) shall become effective on July 1, 1996.

20 SEC. 1444. CONFORMING REIMBURSEMENT FOR PAID

21 BREAKFASTS AND LUNCHES.

22 (a) IN GENERAL.—The last sentence of section

23 4(b)(1)(B) of the Child Nutrition Act of 1966 (42 U.S.C.

24 1773(b)(1)(B)) is amended by striking ‘‘8.25 cents’’ and all

25 that follows through ‘‘Act)’’ and inserting ‘‘the same as the
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1 national average lunch payment for paid meals established

2 under section 4(b) of the National School Lunch Act (42

3 U.S.C. 1753(b))’’.

4 (b) EFFECTIVE DATE.—The amendment made by sub5 section (a) shall become effective on January 1, 1996.

6 PART II—GRANT PROGRAMS

7 SEC. 1451. SCHOOL BREAKFAST STARTUP GRANTS.

8 (a) IN GENERAL.—Section 4 of the Child Nutrition

9 Act of 1966 (42 U.S.C. 1773) is amended by striking sub10 section (g).

11 (b) EFFECTIVE DATE.—The amendment made by sub12 section (a) shall become effective on October 1, 1996.

13 PART III—OTHER AMENDMENTS

14 SEC. 1461. CHILD AND ADULT CARE FOOD PROGRAM.

15 (a) IMPROVED TARGETING OF DAY CARE HOME REIM16 BURSEMENTS.—

17 (1) RESTRUCTURED DAY CARE HOME REIM18 BURSEMENTS.—Section 17(f)(3) of the National

19 School Lunch Act (42 U.S.C. 1766(f)(3)) is amended

20 by striking ‘‘(3)(A) Institutions’’ and all that follows

21 through the end of subparagraph (A) and inserting

22 the following:

23 ‘‘(3) REIMBURSEMENT OF FAMILY OR GROUP DAY

24 CARE HOME SPONSORING ORGANIZATIONS.—

25 ‘‘(A) REIMBURSEMENT FACTOR.—
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1 ‘‘(i) IN GENERAL.—An institution that

2 participates in the program under this sec3 tion as a family or group day care home

4 sponsoring organization shall be provided,

5 for payment to a home sponsored by the or6 ganization, reimbursement factors in ac7 cordance with this subparagraph for the

8 cost of obtaining and preparing food and

9 prescribed labor costs involved in providing

10 meals under this section.

11 ‘‘(ii) TIER I FAMILY OR GROUP DAY

12 CARE HOMES.—

13 ‘‘(I) DEFINITION.—In this para14 graph, the term ‘tier I family or group

15 day care home’ means—

16 ‘‘(aa) a family or group day

17 care home that is located in a geo18 graphic area, as defined by the

19 Secretary based on census data, in

20 which at least 50 percent of the

21 children residing in the area are

22 members of households whose in23 comes meet the income eligibility

24 guidelines for free or reduced price

25 meals under section 9;
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1 ‘‘(bb) a family or group day

2 care home that is located in an

3 area served by a school enrolling

4 elementary students in which at

5 least 50 percent of the total num6 ber of children enrolled are cer7 tified as eligible to receive free or

8 reduced price school meals under

9 this Act or the Child Nutrition

10 Act of 1966 (42 U.S.C. 1771 et

11 seq.); or

12 ‘‘(cc) a family or group day

13 care home that is operated by a

14 provider whose household meets

15 the income eligibility guidelines

16 for free or reduced price meals

17 under section 9 and whose income

18 is verified by the sponsoring orga19 nization of the home under regu20 lations established by the Sec21 retary.

22 ‘‘(II) REIMBURSEMENT.—Except

23 as provided in subclause (III), a tier I

24 family or group day care home shall be

25 provided reimbursement factors under
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1 this clause without a requirement for

2 documentation of the costs described in

3 clause (i), except that reimbursement

4 shall not be provided under this

5 subclause for meals or supplements

6 served to the children of a person act7 ing as a family or group day care

8 home provider unless the children meet

9 the income eligibility guidelines for

10 free or reduced price meals under sec11 tion 9.

12 ‘‘(III) FACTORS.—Except as pro13 vided in subclause (IV), the reimburse14 ment factors applied to a home referred

15 to in subclause (II) shall be the factors

16 in effect on the date of enactment of

17 this subclause.

18 ‘‘(IV) ADJUSTMENTS.—The reim19 bursement factors under this subpara20 graph shall be adjusted on August 1,

21 1996, July 1, 1997, and each July 1

22 thereafter, to reflect changes in the

23 Consumer Price Index for food at home

24 for the most recent 12-month period for

25 which the data are available. The re-
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1 imbursement factors under this sub2 paragraph shall be rounded to the

3 nearest lower cent increment and based

4 on the unrounded adjustment in effect

5 on June 30 of the preceding school

6 year.

7 ‘‘(iii) TIER II FAMILY OR GROUP DAY

8 CARE HOMES.—

9 ‘‘(I) IN GENERAL.—

10 ‘‘(aa) FACTORS.—Except as

11 provided in subclause (II), with

12 respect to meals or supplements

13 served under this clause by a fam14 ily or group day care home that

15 does not meet the criteria set forth

16 in clause (ii)(I), the reimburse17 ment factors shall be $1 for

18 lunches and suppers, 30 cents for

19 breakfasts, and 15 cents for sup20 plements.

21 ‘‘(bb) ADJUSTMENTS.—The

22 factors shall be adjusted on July

23 1, 1997, and each July 1 there24 after, to reflect changes in the

25 Consumer Price Index for food at
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1 home for the most recent 12-month

2 period for which the data are

3 available. The reimbursement fac4 tors under this item shall be

5 rounded down to the nearest lower

6 cent increment and based on the

7 unrounded adjustment for the pre8 ceding 12-month period.

9 ‘‘(cc) REIMBURSEMENT.—A

10 family or group day care home

11 shall be provided reimbursement

12 factors under this subclause with13 out a requirement for documenta14 tion of the costs described in

15 clause (i), except that reimburse16 ment shall not be provided under

17 this subclause for meals or supple18 ments served to the children of a

19 person acting as a family or

20 group day care home provider un21 less the children meet the income

22 eligibility guidelines for free or re23 duced price meals under section 9.

24 ‘‘(II) OTHER FACTORS.—A family

25 or group day care home that does not
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1 meet the criteria set forth in clause

2 (ii)(I) may elect to be provided reim3 bursement factors determined in ac4 cordance with the following require5 ments:

6 ‘‘(aa) CHILDREN ELIGIBLE

7 FOR FREE OR REDUCED PRICE

8 MEALS.—In the case of meals or

9 supplements served under this

10 subsection to children who are

11 members of households whose in12 comes meet the income eligibility

13 guidelines for free or reduced price

14 meals under section 9, the family

15 or group day care home shall be

16 provided reimbursement factors

17 set by the Secretary in accordance

18 with clause (ii)(III).

19 ‘‘(bb) INELIGIBLE CHIL20 DREN.—In the case of meals or

21 supplements served under this

22 subsection to children who are

23 members of households whose in24 comes do not meet the income eli25 gibility guidelines, the family or
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1 group day care home shall be pro2 vided reimbursement factors in

3 accordance with subclause (I).

4 ‘‘(III) INFORMATION AND DETER5 MINATIONS.—

6 ‘‘(aa) IN GENERAL.—If a

7 family or group day care home

8 elects to claim the factors de9 scribed in subclause (II), the fam10 ily or group day care home spon11 soring organization serving the

12 home shall collect the necessary

13 income information, as deter14 mined by the Secretary, from any

15 parent or other caretaker to make

16 the determinations specified in

17 subclause (II) and shall make the

18 determinations in accordance

19 with rules prescribed by the Sec20 retary.

21 ‘‘(bb) CATEGORICAL ELIGI22 BILITY.—In making a determina23 tion under item (aa), a family or

24 group day care home sponsoring

25 organization may consider a child
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1 participating in or subsidized

2 under, or a child with a parent

3 participating in or subsidized

4 under, a federally or State sup5 ported child care or other benefit

6 program with an income eligi7 bility limit that does not exceed

8 the eligibility standard for free or

9 reduced price meals under section

10 9 to be a child who is a member

11 of a household whose income meets

12 the income eligibility guidelines

13 under section 9.

14 ‘‘(cc) FACTORS FOR CHIL15 DREN ONLY.—A family or group

16 day care home may elect to re17 ceive the reimbursement factors

18 prescribed under clause (ii)(III)

19 solely for the children participat20 ing in a program referred to in

21 item (bb) if the home elects not to

22 have income statements collected

23 from parents or other caretakers.

24 ‘‘(IV) SIMPLIFIED MEAL COUNT25 ING AND REPORTING PROCEDURES.—
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1 The Secretary shall prescribe sim2 plified meal counting and reporting

3 procedures for use by a family or

4 group day care home that elects to

5 claim the factors under subclause (II)

6 and by a family or group day care

7 home sponsoring organization that

8 sponsors the home. The procedures the

9 Secretary prescribes may include 1 or

10 more of the following:

11 ‘‘(aa) Setting an annual per12 centage for each home of the num13 ber of meals served that are to be

14 reimbursed in accordance with the

15 reimbursement factors prescribed

16 under clause (ii)(III) and an an17 nual percentage of the number of

18 meals served that are to be reim19 bursed in accordance with the re20 imbursement factors prescribed

21 under subclause (I), based on the

22 family income of children enrolled

23 in the home in a specified month

24 or other period.
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1 ‘‘(bb) Placing a home into 1

2 of 2 or more reimbursement cat3 egories annually based on the per4 centage of children in the home

5 whose households have incomes

6 that meet the income eligibility

7 guidelines under section 9, with

8 each such reimbursement category

9 carrying a set of reimbursement

10 factors such as the factors pre11 scribed under clause (ii)(III) or

12 subclause (I) or factors established

13 within the range of factors pre14 scribed under clause (ii)(III) and

15 subclause (I).

16 ‘‘(cc) Such other simplified

17 procedures as the Secretary may

18 prescribe.

19 ‘‘(V) MINIMUM VERIFICATION RE20 QUIREMENTS.—The Secretary may es21 tablish any necessary minimum ver22 ification requirements.’’.

23 (2) GRANTS TO STATES TO PROVIDE ASSISTANCE

24 TO FAMILY OR GROUP DAY CARE HOMES.—Section
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1 17(f)(3) of the Act is amended by adding at the end

2 the following:

3 ‘‘(D) GRANTS TO STATES TO PROVIDE AS4 SISTANCE TO FAMILY OR GROUP DAY CARE

5 HOMES.—

6 ‘‘(i) IN GENERAL.—

7 ‘‘(I) RESERVATION.—From

8 amounts made available to carry out

9 this section, the Secretary shall reserve

10 $5,000,000 of the amount made avail11 able for fiscal year 1996.

12 ‘‘(II) PURPOSE.—The Secretary

13 shall use the funds made available

14 under subclause (I) to provide grants

15 to States for the purpose of provid16 ing—

17 ‘‘(aa) assistance, including

18 grants, to family and day care

19 home sponsoring organizations

20 and other appropriate organiza21 tions, in securing and providing

22 training, materials, automated

23 data processing assistance, and

24 other assistance for the staff of the

25 sponsoring organizations; and
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1 ‘‘(bb) training and other as2 sistance to family and group day

3 care homes in the implementation

4 of the amendments to subpara5 graph (A) made by section

6 1461(a)(1) of the Agricultural

7 Reconciliation Act of 1995.

8 ‘‘(ii) ALLOCATION.—The Secretary

9 shall allocate from the funds reserved under

10 clause (i)(I)—

11 ‘‘(I) $30,000 in base funding to

12 each State; and

13 ‘‘(II) any remaining amount

14 among the States, based on the number

15 of family day care homes participating

16 in the program in a State during fis17 cal year 1994 as a percentage of the

18 number of all family day care homes

19 participating in the program during

20 fiscal year 1994.

21 ‘‘(iii) RETENTION OF FUNDS.—Of the

22 amount of funds made available to a State

23 for fiscal year 1996 under clause (i), the

24 State may retain not to exceed 30 percent
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1 of the amount to carry out this subpara2 graph.

3 ‘‘(iv) ADDITIONAL PAYMENTS.—Any

4 payments received under this subparagraph

5 shall be in addition to payments that a

6 State receives under subparagraph (A) (as

7 amended by section 1461(a)(1) of the Agri8 cultural Reconciliation Act of 1995).’’.

9 (3) PROVISION OF DATA.—Section 17(f)(3) of the

10 Act (as amended by paragraph (2)) is further amend11 ed by adding at the end the following:

12 ‘‘(E) PROVISION OF DATA TO FAMILY OR

13 GROUP DAY CARE HOME SPONSORING ORGANIZA14 TIONS.—

15 ‘‘(i) CENSUS DATA.—The Secretary

16 shall provide to each State agency admin17 istering a child and adult care food pro18 gram under this section data from the most

19 recent decennial census survey or other ap20 propriate census survey for which the data

21 are available showing which areas in the

22 State meet the requirements of subpara23 graph (A)(ii)(I)(aa). The State agency shall

24 provide the data to family or group day
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1 care home sponsoring organizations located

2 in the State.

3 ‘‘(ii) SCHOOL DATA.—

4 ‘‘(I) IN GENERAL.—A State agen5 cy administering the school lunch pro6 gram under this Act or the school

7 breakfast program under the Child Nu8 trition Act of 1966 (42 U.S.C. 1771 et

9 seq.) shall provide to approved family

10 or group day care home sponsoring or11 ganizations a list of schools serving ele12 mentary school children in the State in

which not less than 1 13 ⁄2 of the children

14 enrolled are certified to receive free or

15 reduced price meals. The State agency

16 shall collect the data necessary to cre17 ate the list annually and provide the

18 list on a timely basis to any approved

19 family or group day care home spon20 soring organization that requests the

21 list.

22 ‘‘(II) USE OF DATA FROM PRE23 CEDING SCHOOL YEAR.—In determin24 ing for a fiscal year or other annual

25 period whether a home qualifies as a
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1 tier I family or group day care home

2 under subparagraph (A)(ii)(I), the

3 State agency administering the pro4 gram under this section, and a family

5 or group day care home sponsoring or6 ganization, shall use the most current

7 available data at the time of the deter8 mination.

9 ‘‘(iii) DURATION OF DETERMINA10 TION.—For purposes of this section, a deter11 mination that a family or group day care

12 home is located in an area that qualifies the

13 home as a tier I family or group day care

14 home (as the term is defined in subpara15 graph (A)(ii)(I)), shall be in effect for 3

16 years (unless the determination is made on

17 the basis of census data, in which case the

18 determination shall remain in effect until

19 more recent census data are available) un20 less the State agency determines that the

21 area in which the home is located no longer

22 qualifies the home as a tier I family or

23 group day care home.’’.

24 (4) CONFORMING AMENDMENTS.—Section 17(c)

25 of the Act is amended by inserting ‘‘except as pro-
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1 vided in subsection (f)(3),’’ after ‘‘For purposes of this

2 section,’’ each place it appears in paragraphs (1), (2),

3 and (3).

4 (b) ELIMINATION OF STATE PAPERWORK AND OUT5 REACH BURDEN.—Section 17 of the Act is amended by

6 striking subsection (k) and inserting the following:

7 ‘‘(k) TRAINING AND TECHNICAL ASSISTANCE.—A

8 State participating in the program established under this

9 section shall provide sufficient training, technical assist10 ance, and monitoring to facilitate effective operation of the

11 program. The Secretary shall assist the State in developing

12 plans to fulfill the requirements of this subsection.’’.

13 (c) EFFECTIVE DATE.—

14 (1) IN GENERAL.—Except as provided in para15 graph (2), the amendments made by this section shall

16 become effective on the date of enactment of this Act.

17 (2) IMPROVED TARGETING OF DAY CARE HOME

18 REIMBURSEMENTS.—The amendments made by para19 graphs (1), (3), and (4) of subsection (a) shall become

20 effective on August 1, 1996.

21 CHAPTER 3—ADDITIONAL SAVINGS

22 SEC. 1471. EARNINGS OF STUDENTS.

23 Section 5(d)(7) of the Food Stamp Act of 1977 (7

24 U.S.C. 2014(d)(7)) is amended by striking ‘‘21’’ and insert25 ing ‘‘17’’.
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1 SEC. 1472. STANDARD DEDUCTION.

2 Section 5(e) of the Food Stamp Act of 1977 (7 U.S.C.

3 2014(e)) is amended by adding at the end the following:

4 ‘‘Notwithstanding any other provision of this subsection, the

5 Secretary shall allow a standard deduction of $134 for fis6 cal year 1995, $132 for the period consisting of October 1,

7 1995, through December 31, 1995, and $116 for the period

8 consisting of January 1, 1996, through fiscal year 2002,

9 except that households in Alaska, Hawaii, Guam, and the

10 Virgin Islands of the United States shall be allowed a stand11 ard deduction of $229, $189, $269, and $118, respectively,

12 for fiscal year 1995; $225, $186, $265, and $116, respec13 tively, for the period consisting of October 1, 1995, through

14 December 31, 1995; and $198, $164, $233, and $102, re15 spectively, for the period consisting of January 1, 1996,

16 through fiscal year 2002.’’.

17 SEC. 1473. VENDOR PAYMENTS FOR TRANSITIONAL HOUS18 ING COUNTED AS INCOME.

19 Section 5(k)(2) of the Food Stamp Act of 1977 (7

20 U.S.C. 2014(k)(2)) (as amended by section 1406(b)(1)(B))

21 is amended—

22 (1) by striking subparagraph (E); and

23 (2) by redesignating subparagraphs (F) and (G)

24 as subparagraphs (E) and (F), respectively.
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1 SEC. 1474. EXTENDING CLAIMS RETENTION RATES.

2 The first sentence of section 16(a) of the Food Stamp

3 Act of 1977 (7 U.S.C. 2025(a)) is amended by striking

4 ‘‘1995’’ each place it appears and inserting ‘‘2002’’.

5 SEC. 1475. REAUTHORIZATION OF PUERTO RICO NUTRI6 TION ASSISTANCE PROGRAM.

7 The first sentence of section 19(a)(1)(A) of the Food

8 Stamp Act of 1977 (7 U.S.C. 2028(a)(1)(A)) is amended

9 by striking ‘‘$974,000,000’’ and all that follows through

10 ‘‘fiscal year 1995’’ and inserting ‘‘$1,143,000,000 for each

11 of fiscal years 1995 and 1996, $1,171,000,000 for fiscal year

12 1997, $1,212,000,000 for fiscal year 1998, $1,255,000,000

13 for fiscal year 1999, $1,299,000,000 for fiscal year 2000,

14 $1,342,000,000 for fiscal year 2001, and $1,376,000,000 for

15 fiscal year 2002’’.

16 SEC. 1476. VALUE OF FOOD ASSISTANCE.

17 (a) IN GENERAL.—Section 6(e)(1) of the National

18 School Lunch Act (42 U.S.C. 1755(e)(1)) is amended by

19 striking subparagraph (B) and inserting the following:

20 ‘‘(B) ADJUSTMENTS.—

21 ‘‘(i) IN GENERAL.—The value of food

22 assistance for each meal shall be adjusted

23 each July 1 by the annual percentage

24 change in a 3-month average value of the

25 Price Index for Foods Used in Schools and
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1 Institutions for March, April, and May

2 each year.

3 ‘‘(ii) ADJUSTMENTS.—Except as other4 wise provided in this subparagraph, in the

5 case of each school year, the Secretary

6 shall—

7 ‘‘(I) base the adjustment made

8 under clause (i) on the amount of the

9 unrounded adjustment for the preced10 ing school year;

11 ‘‘(II) adjust the resulting amount

12 in accordance with clause (i); and

13 ‘‘(III) round the result to the

14 nearest lower cent increment.

15 ‘‘(iii) ADJUSTMENT ON JANUARY 1,

16 1996.—On January 1, 1996, the Secretary

17 shall adjust the value of food assistance for

18 the remainder of the school year by round19 ing the previously established value of food

20 assistance to the nearest lower cent incre21 ment.

22 ‘‘(iv) ADJUSTMENT FOR 24-MONTH PE23 RIOD BEGINNING JULY 1, 1996.—In the case

24 of the 24-month period beginning July 1,

25 1996, the value of food assistance shall be
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1 the same as the value of food assistance in

2 effect on June 30, 1996.

3 ‘‘(v) ADJUSTMENT FOR SCHOOL YEAR

4 BEGINNING JULY 1, 1998.—In the case of the

5 school year beginning July 1, 1998, the Sec6 retary shall—

7 ‘‘(I) base the adjustment made

8 under clause (i) on the amount of the

9 unrounded adjustment for the value of

10 food assistance for the school year be11 ginning July 1, 1995;

12 ‘‘(II) adjust the resulting amount

13 to reflect the annual percentage change

14 in a 3-month average value of the

15 Price Index for Foods Used in Schools

16 and Institutions for March, April, and

17 May for the most recent 12-month pe18 riod for which the data are available;

19 and

20 ‘‘(III) round the result to the

21 nearest lower cent increment.’’.

22 (b) EFFECTIVE DATE.—The amendment made by sub23 section (a) shall become effective on January 1, 1996.
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1 SEC. 1477. COMMODITY ASSISTANCE.

2 (a) IN GENERAL.—Section 6(g) of the National School

3 Lunch Act (42 U.S.C. 1755(g)) is amended by striking ‘‘12

4 percent’’ and inserting ‘‘10 percent’’.

5 (b) EFFECTIVE DATE.—The amendment made by sub6 section (a) shall become effective on July 1, 1996.

7 SEC. 1478. SUMMER FOOD SERVICE PROGRAM FOR CHIL8 DREN.

9 (a) IN GENERAL.—Section 13(b) of the National

10 School Lunch Act (42 U.S.C. 1761(b)) is amended—

11 (1) by striking ‘‘(b)(1)’’ and all that follows

12 through the end of paragraph (1) and inserting the

13 following:

14 ‘‘(b) SERVICE INSTITUTIONS.—

15 ‘‘(1) PAYMENTS.—

16 ‘‘(A) IN GENERAL.—Except as otherwise

17 provided in this paragraph, payments to service

18 institutions shall equal the full cost of food serv19 ice operations (which cost shall include the costs

20 of obtaining, preparing, and serving food, but

21 shall not include administrative costs).

22 ‘‘(B) MAXIMUM AMOUNTS.—Subject to sub23 paragraph (C), payments to any institution

24 under subparagraph (A) shall not exceed—

25 ‘‘(i) $1.82 for each lunch and supper

26 served;
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1 ‘‘(ii) $1.13 for each breakfast served;

2 and

3 ‘‘(iii) 46 cents for each meal supple4 ment served.

5 ‘‘(C) ADJUSTMENTS.—Amounts specified in

6 subparagraph (B) shall be adjusted each Janu7 ary 1 to the nearest lower cent increment in ac8 cordance with the changes for the 12-month pe9 riod ending the preceding November 30 in the se10 ries for food away from home of the Consumer

11 Price Index for All Urban Consumers published

12 by the Bureau of Labor Statistics of the Depart13 ment of Labor. Each adjustment shall be based

14 on the unrounded adjustment for the prior 12-

15 month period.’’;

16 (2) in the second sentence of paragraph (3), by

17 striking ‘‘levels determined’’ and all that follows

18 through ‘‘this subsection’’ and inserting ‘‘level deter19 mined by the Secretary’’; and

20 (3) by striking paragraph (4).

21 (b) EFFECTIVE DATE.—The amendments made by sub22 section (a) shall become effective on January 1, 1996.
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1 SEC. 1479. SPECIAL MILK PROGRAM.

2 (a) IN GENERAL.—Section 3(a) of the Child Nutrition

3 Act of 1966 (42 U.S.C. 1772(a)) is amended by striking

4 paragraph (8) and inserting the following:

5 ‘‘(8) ADJUSTMENTS.—

6 ‘‘(A) IN GENERAL.—Except as otherwise

7 provided in this paragraph, in the case of each

8 school year, the Secretary shall—

9 ‘‘(i) base the adjustment made under

10 paragraph (7) on the amount of the

11 unrounded adjustment for the preceding

12 school year;

13 ‘‘(ii) adjust the resulting amount in

14 accordance with paragraph (7); and

15 ‘‘(iii) round the result to the nearest

16 lower cent increment.

17 ‘‘(B) ADJUSTMENT ON JANUARY 1, 1996.—

18 On January 1, 1996, the Secretary shall adjust

19 the minimum rate for the remainder of the

20 school year by rounding the previously estab21 lished minimum rate to the nearest lower cent

22 increment.

23 ‘‘(C) ADJUSTMENT FOR 24-MONTH PERIOD

24 BEGINNING JULY 1, 1996.—In the case of the 24-

25 month period beginning July 1, 1996, the mini-
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1 mum rate shall be the same as the minimum

2 rate in effect on June 30, 1996.

3 ‘‘(D) ADJUSTMENT FOR SCHOOL YEAR BE4 GINNING JULY 1, 1998.—In the case of the school

5 year beginning July 1, 1998, the Secretary

6 shall—

7 ‘‘(i) base the adjustment made under

8 paragraph (7) on the amount of the

9 unrounded adjustment for the minimum

10 rate for the school year beginning July 1,

11 1995;

12 ‘‘(ii) adjust the resulting amount to re13 flect changes in the Producer Price Index

14 for Fresh Processed Milk published by the

15 Bureau of Labor Statistics of the Depart16 ment of Labor for the most recent 12-month

17 period for which the data are available; and

18 ‘‘(iii) round the result to the nearest

19 lower cent increment.’’.

20 (b) EFFECTIVE DATE.—The amendment made by sub21 section (a) shall become effective on January 1, 1996.
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1 SEC. 1480. NUTRITION EDUCATION AND TRAINING PRO2 GRAMS.

3 (a) IN GENERAL.—Section 19(i)(2)(A) of the Child

4 Nutrition Act of 1966 (42 U.S.C. 1788(i)(2)(A)) is amended

5 by striking ‘‘$10,000,000’’ and inserting ‘‘$7,000,000’’.

6 (b) EFFECTIVE DATE.—The amendment made by sub7 section (a) shall become effective on October 1, 1996.

8 SEC. 1481. EFFECTIVE DATE.

9 Except as otherwise provided in this chapter, this

10 chapter and the amendments made by this chapter shall be11 come effective on October 1, 1995.

12 CHAPTER 4—EFFECTIVE DATE

13 SEC. 1491. EFFECTIVE DATE.

14 Notwithstanding any other provision of this subtitle,

15 if the Act entitled ‘‘An Act to restore the American family,

16 reduce illegitimacy, control welfare spending and reduce

17 welfare dependence’’ is enacted on or before December 31,

18 1996, the amendments made by chapters 1 and 2 of this

19 subtitle shall be effective only during the period prior to

20 the date of enactment of such Act.
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1 TITLE II—COMMITTEE ON

2 ARMED SERVICES

3 SEC. 2001. DISPOSAL OF OBSOLETE AND EXCESS MATE4 RIALS CONTAINED IN THE NATIONAL DE5 FENSE STOCKPILE.

6 (a) DISPOSAL AUTHORIZED.—During the 7-year pe7 riod beginning on October 1, 1995, the President shall sell

8 in accordance with this section such quantities of materials

9 currently contained in the National Defense Stockpile

10 (within the limits of subsection (c)) as are necessary to

11 achieve proceeds in the total amount of $649,000,000.

12 (b) MINIMUM SALES EACH YEAR.—The President

13 shall sell materials under subsection (a) as necessary in a

14 fiscal year to ensure that, by the end of that fiscal year,

15 the total amount of the proceeds received by the United

16 States from such sales and from the sales under subsection

17 (a) during preceding fiscal years equals or exceeds the

18 amount indicated for that fiscal year as follows:

19 (1) By the end of fiscal year 1996, $71,000,000.

20 (2) By the end of fiscal year 1997, $115,000,000.

21 (3) By the end of fiscal year 1998, $181,000,000.

22 (4) By the end of fiscal year 1999, $272,000,000.

23 (5) By the end of fiscal year 2000, $388,000,000.

24 (6) By the end of fiscal year 2001, $530,000,000.

25 (7) By the end of fiscal year 2002, $649,000,000.
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1 (c) MATERIALS COVERED.— The materials subject to

2 sale under this section and the maximum quantity of each

3 material authorized to be sold by the President are set forth

4 in the following table:

Authorized Stockpile Disposals

Material for disposal Quantity

Aluminum .................................................................................... 20,000 short tons

Chromium Metal .......................................................................... 2,000 short tons

Cobalt ............................................................................................ 30,000,000 pounds

of contained cobalt

Columbium Carbide ..................................................................... 10,000 pounds of

contained columbium

Columbium Ferro ......................................................................... 500,000 pounds of

contained columbium

Diamond, Bort ............................................................................. 40,000 carats

Diamond Stones ........................................................................... 2,500,000 carats

Germanium Metal ........................................................................ 40,000 kilograms

Indium .......................................................................................... 35,000 troy ounces

Mica, Phlogopite Block ................................................................ 65,000 pounds

Platinum ...................................................................................... 25,000 troy ounces

Palladium ..................................................................................... 55,000 troy ounces

Rubber, Natural ........................................................................... 75,000 long tons

Tantalum, Carbide Powder ......................................................... 6,000 pounds of

contained tantalum

Tantalum, Minerals ..................................................................... 750,000 pounds of

contained tantalum

Tantalum, Oxide .......................................................................... 40,000 pounds of

contained tantalum

Titanium Sponge ......................................................................... 15,000 short tons

Tungsten, Ore and Concentrate .................................................. 19,850,000 pounds

of contained

tungsten

Tungsten Carbide ......................................................................... 50,000 pounds of

contained tungsten

Tungsten Metal Powder ............................................................... 50,000 pounds of

contained tungsten

Tungsten Ferro ............................................................................. 50,000 pounds of

contained tungsten

Vegetable Tannin, Chestnut ........................................................ 2,500 long tons

Vegetable Tannin, Quebracho ...................................................... 35,000 long tons

Vegetable Tannin, Wattle ............................................................ 3,000 long tons

5 (d) RELATIONSHIP TO OTHER DISPOSAL AUTHOR6 ITY.—(1) The disposal authority provided in this section
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1 is in addition to any other disposal authority provided by

2 law.

3 (2) The President may not sell materials under this

4 section before disposing of the maximum quantities of mate5 rials in the National Defense Stockpile that the President

6 is authorized to dispose of under laws enacted before the

7 date of the enactment of this Act (except the Strategic and

8 Critical Materials Stock Piling Act).

9 (e) DISPOSITION OF PROCEEDS.—Proceeds of sales

10 under this section shall be credited to the general fund of

11 the Treasury for reduction of budget deficits.

12 TITLE III—COMMITTEE ON BANK13 ING, HOUSING, AND URBAN

14 AFFAIRS

15 SEC. 3001. STABILIZATION OF THE SAVINGS ASSOCIATION

16 INSURANCE FUND.

17 (a) SPECIAL ASSESSMENT TO CAPITALIZE SAIF.—

18 (1) IN GENERAL.—Except as provided in para19 graph (6), the Board of Directors shall impose a spe20 cial assessment on the SAIF-assessable deposits of

21 each insured depository institution at a rate that the

22 Board of Directors, in its sole discretion, determines

23 will cause the Savings Association Insurance Fund to

24 achieve the designated reserve ratio on the first busi25 ness day of January 1996.
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1 (2) FACTORS TO BE CONSIDERED.—In carrying

2 out paragraph (1), the Board of Directors shall base

3 its determination on—

4 (A) the monthly Savings Association Insur5 ance Fund balance most recently calculated;

6 (B) data on insured deposits reported in the

7 most recent reports of condition filed not later

8 than 70 days before the date of enactment of this

9 Act by insured depository institutions; and

10 (C) any other factors that the Board of Di11 rectors deems appropriate.

12 (3) DATE OF DETERMINATION.—For purposes of

13 paragraph (1), the amount of the SAIF-assessable de14 posits of an insured depository institution shall be de15 termined as of March 31, 1995.

16 (4) DATE PAYMENT DUE.—The special assess17 ment imposed under this section shall be—

18 (A) due on the first business day of Janu19 ary 1996; and

20 (B) paid to the Corporation on the later

21 of—

22 (i) the first business day of January

23 1996; or
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1 (ii) such other date as the Corporation

2 shall prescribe, but not later than 60 days

3 after the date of enactment of this Act.

4 (5) ASSESSMENT DEPOSITED IN SAIF.—Notwith5 standing any other provision of law, the proceeds of

6 the special assessment imposed under this subsection

7 shall be deposited in the Savings Association Insur8 ance Fund.

9 (6) DISCRETION TO EXEMPT WEAK INSTITU10 TIONS.—

11 (A) IN GENERAL.—The Board of Directors

12 may, by order, in its sole discretion, exempt any

13 insured depository institution that the Board of

14 Directors determines to be weak from paying the

15 special assessment imposed under this subsection

16 if the Board of Directors determines that the ex17 emption would reduce risk to the Savings Asso18 ciation Insurance Fund.

19 (B) GUIDELINES REQUIRED.—Not later

20 than 30 days after the date of enactment of this

21 Act, the Board of Directors shall prescribe guide22 lines setting forth the criteria that the Board of

23 Directors will use in exempting institutions

24 under subparagraph (A). Such guidelines shall

25 be published in the Federal Register.
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1 (C) EXEMPTION FOR CERTAIN NEWLY CHAR2 TERED INSTITUTIONS.—

3 (i) IN GENERAL.—In addition to the

4 institutions exempted from paying the spe5 cial assessment under subparagraph (A), the

6 Board of Directors shall, by order, exempt

7 any insured depository institution from

8 payment of the special assessment if the in9 stitution was in existence on October 1,

10 1995, and held no Savings Association In11 surance Fund insured deposits prior to

12 January 1, 1993.

13 (ii) DEFINITION.—For purposes of this

14 subparagraph, an institution shall be

15 deemed to have held Savings Association In16 surance Fund insured deposits prior to

17 January 1, 1993, if it directly held Savings

18 Association Insurance Fund insured depos19 its prior to that date, or it succeeded to, ac20 quired, purchased, or otherwise holds any

21 Savings Association Insurance Fund in22 sured deposits as of the date of enactment of

23 this Act that were Savings Association In24 surance Fund insured prior to January 1,

25 1993.
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1 (D) EXEMPT INSTITUTIONS REQUIRED TO

2 PAY ASSESSMENTS AT FORMER RATES.—

3 (i) PAYMENTS TO SAIF AND DIF.—Any

4 insured depository institution that the

5 Board of Directors exempts under this para6 graph from paying the special assessment

7 imposed under this subsection shall pay

8 semiannual assessments—

9 (I) into the Savings Association

10 Insurance Fund during calendar years

11 1996 and 1997, based on SAIF-assess12 able deposits of that institution, at as13 sessment rates calculated under the

14 schedule in effect for Savings Associa15 tion Insurance Fund members on June

16 30, 1995; and

17 (II) into the Deposit Insurance

18 Fund during the period beginning on

19 January 1, 1998 and ending on De20 cember 31, 1999, based on SAIF-assess21 able deposits of that institution, at as22 sessment rates calculated under the

23 schedule in effect for Savings Associa24 tion Insurance Fund members on June

25 30, 1995, except that subclause (I)
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1 shall continue to apply if and only so

2 long as the Bank Insurance Fund and

3 the Savings Association Insurance

4 Fund are not merged into the Deposit

5 Insurance Fund.

6 (ii) OPTIONAL PRO RATA PAYMENT OF

7 SPECIAL ASSESSMENT.—This subparagraph

8 shall not apply with respect to any insured

9 depository institution (or successor insured

10 depository institution) that has paid, dur11 ing any calendar year from 1997 through

12 1999, upon such terms as the Corporation

13 may announce, an amount equal to the

14 product of—

15 (I) 12.5 percent of the special as16 sessment that the institution would

17 have been required to pay under para18 graph (1), if the Board of Directors

19 had not exempted the institution; and

20 (II) the number of full semi21 annual periods remaining between the

22 date of the payment and December 31,

23 1999.

24 (7) ADJUSTMENT OF SPECIAL ASSESSMENT FOR

25 CERTAIN BANK INSURANCE FUND MEMBER BANKS.—
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1 (A) IN GENERAL.—For purposes of comput2 ing the special assessment imposed under this

3 subsection with respect to a Bank Insurance

4 Fund member bank, the amount of any deposits

5 which section 5(d)(3) of the Federal Deposit In6 surance Act treats as insured by the Savings As7 sociation Insurance Fund shall be reduced by 5

8 percent, if the adjusted attributable deposit

9 amount of the Bank Insurance Fund member

10 bank is less than 50 percent of the total deposits

11 of that member bank as of June 30, 1995.

12 (B) ADJUSTED ATTRIBUTABLE DEPOSIT

13 AMOUNT.—For purposes of this paragraph, the

14 ‘‘adjusted attributable deposit amount’’ shall be

15 determined in accordance with section 5(d)(3)(C)

16 of the Federal Deposit Insurance Act.

17 (8) ADJUSTMENT TO THE ADJUSTED ATTRIB18 UTABLE DEPOSIT AMOUNT FOR CERTAIN BANK INSUR19 ANCE FUND MEMBER BANKS.—Section 5(d)(3) of the

20 Federal Deposit Insurance Act (12 U.S.C. 1815(d)(3))

21 is amended—

22 (A) in subparagraph (C), by striking ‘‘The

23 adjusted attributable deposit amount’’ and in24 serting ‘‘Except as provided in subparagraph
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1 (K), the adjusted attributable deposit amount’’;

2 and

3 (B) by adding at the end the following new

4 subparagraph:

5 ‘‘(K) ADJUSTMENT OF ADJUSTED ATTRIB6 UTABLE DEPOSIT AMOUNT.—The amount deter7 mined under subparagraph (C)(i) for deposits

8 acquired by March 31, 1995, shall be reduced by

9 10 percent for purposes of computing the ad10 justed attributable deposit amount for the pay11 ment of any assessment for any semiannual pe12 riod after December 31, 1995 (other than the spe13 cial assessment imposed under section 3001(a) of

14 the Balanced Budged Reconciliation Act of

15 1995), for a Bank Insurance Fund member bank

16 that had an adjusted attributable deposit amount

17 that was less than 50 percent of the total deposits

18 of that member bank as of June 30, 1995.’’.

19 (9) ADJUSTMENT OF SPECIAL ASSESSMENT FOR

20 CERTAIN SAVINGS ASSOCIATIONS.—

21 (A) SPECIAL ASSESSMENT REDUCTION.—

22 For purposes of computing the special assessment

23 imposed under this subsection, in the case of any

24 converted association, the amount of any deposits

25 of such association which were insured by the
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1 Savings Association Insurance Fund as of March

2 31, 1995, shall be reduced by 10 percent.

3 (B) CONVERTED ASSOCIATION.—For pur4 poses of this paragraph, the term ‘‘converted as5 sociation’’ means—

6 (i) any Federal savings association

7 that is a member of the Savings Association

8 Insurance Fund and that had been, or has

9 acquired by merger, consolidation, or other10 wise the deposits of an institution that had

11 been, a State savings bank, the deposits of

12 which were insured under the Federal De13 posit Insurance Act prior to August 9,

14 1989; and

15 (ii) a State depository institution that

16 is a member of the Savings Association In17 surance Fund that had been a State savings

18 bank prior to October 1, 1992, and was a

19 Federal savings association on August 9,

20 1989.

21 (b) FINANCING CORPORATION ASSESSMENTS SHARED

22 PROPORTIONALLY BY ALL INSURED DEPOSITORY INSTITU23 TIONS.—

24 (1) IN GENERAL.—Section 21 of the Federal

25 Home Loan Bank Act (12 U.S.C. 1441) is amended—
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1 (A) in subsection (f)(2)—

2 (i) in the matter immediately preced3 ing subparagraph (A)—

4 (I) by striking ‘‘Savings Associa5 tion Insurance Fund member’’ and in6 serting ‘‘insured depository institu7 tion’’; and

8 (II) by striking ‘‘members’’ and

9 inserting ‘‘institutions’’; and

10 (ii) in subparagraph (A), by striking

11 ‘‘against Savings Association Insurance

12 Fund members’’ and inserting ‘‘against in13 sured depository institutions’’;

14 (B) in subsection (k)—

15 (i) by striking ‘‘section—’’ and insert16 ing ‘‘section, the following definitions shall

17 apply:’’;

18 (ii) by striking paragraph (1);

19 (iii) by redesignating paragraphs (2)

20 and (3) as paragraphs (1) and (2), respec21 tively; and

22 (iv) by adding at the end the following

23 new paragraph:

24 ‘‘(3) INSURED DEPOSITORY INSTITUTION.—The

25 term ‘insured depository institution’ has the same
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1 meaning as in section 3 of the Federal Deposit Insur2 ance Act.’’.

3 (2) CONFORMING AMENDMENT.—Section

4 7(b)(2)(D) of the Federal Deposit Insurance Act (12

5 U.S.C. 1817(b)(2)(D)) is amended by striking

6 ‘‘against Savings Association Insurance Fund mem7 bers’’ and inserting ‘‘against insured depository insti8 tutions’’.

9 (3) EFFECTIVE DATE.—This subsection and the

10 amendments made by this subsection shall become ef11 fective on January 1, 1996.

12 (c) INSURANCE PREMIUMS FOR CAPITALIZED INSUR13 ANCE FUNDS.—

14 (1) REBATES FOR CAPITALIZED FUND.—Section

15 7 of the Federal Deposit Insurance Act (12 U.S.C.

16 1817) is amended—

17 (A) by redesignating subsections (d) through

18 (n) as subsections (e) through (o), respectively;

19 and

20 (B) by inserting after subsection (c) the fol21 lowing new subsection:

22 ‘‘(d) BANK INSURANCE FUND ASSESSMENT CRED23 ITS.—

24 ‘‘(1) CREDIT AMOUNT.—
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1 ‘‘(A) IN GENERAL.—Notwithstanding any

2 other provision of law, if the Corporation deter3 mines, after considering the operating costs and

4 expenses, case resolution expenditures, invest5 ment income, and assessment income of the Bank

6 Insurance Fund, that the reserve ratio of the

7 Bank Insurance Fund is expected to exceed the

8 designated reserve ratio during the succeeding

9 semiannual period, the Board of Directors may,

10 in its sole discretion, provide an assessment cred11 it with respect to Bank Insurance Fund assess12 ments (for that succeeding semiannual period)—

13 ‘‘(i) in an amount that the Corpora14 tion determines will reduce the reserve ratio

15 of the Bank Insurance Fund to the des16 ignated reserve ratio; or

17 ‘‘(ii) in a lesser amount, as determined

18 by the Corporation.

19 ‘‘(B) LIMIT.—The amount of assessment

20 credit under subparagraph (A) shall not exceed

21 100 percent of the net assessment income to be

22 received with respect to the Bank Insurance

23 Fund in the succeeding semiannual period.

24 ‘‘(2) DEFINITIONS.—For purposes of this sub25 section, the terms ‘net assessment income’, ‘operating
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1 costs and expenses’, ‘insurance costs’, and ‘investment

2 income’ shall have the same meanings as in para3 graphs (4) and (5) of section 7(d) of the Federal De4 posit Insurance Act, as in effect on the day before the

5 date of enactment of the Federal Deposit Insurance

6 Corporation Improvement Act of 1991, except that the

7 term ‘semiannual period’ shall be substituted for the

8 term ‘calendar year’ wherever that term appears.’’.

9 (2) STABILIZING PREMIUMS FOR BIF AND

10 SAIF.—Section 7(b) of the Federal Deposit Insurance

11 Act (12 U.S.C. 1817(b)) is amended by adding at the

12 end the following new paragraph:

13 ‘‘(8) RATE COMPARABILITY.—Notwithstanding

14 any other provision of law, assessment rates for mem15 bers of the Savings Association Insurance Fund shall

16 not be lower than assessment rates for members of the

17 Bank Insurance Fund of comparable risk until the

18 first full semiannual period following the last matu19 rity date of all obligations issued by the Financing

20 Corporation pursuant to section 21(c) of the Federal

21 Home Loan Bank Act.’’.

22 (d) MERGER OF BIF AND SAIF.—

23 (1) IN GENERAL.—Effective as provided in para24 graph (4)—
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1 (A) the Bank Insurance Fund and the Sav2 ings Association Insurance Fund shall be merged

3 into the Deposit Insurance Fund established by

4 section 11(a)(4) of the Federal Deposit Insurance

5 Act, as amended by this subsection;

6 (B) all assets and liabilities of the Bank In7 surance Fund and the Savings Association In8 surance Fund shall be transferred to the Deposit

9 Insurance Fund; and

10 (C) the separate existence of the Bank In11 surance Fund and the Savings Association In12 surance Fund shall cease.

13 (2) SPECIAL RESERVE OF THE DEPOSIT INSUR14 ANCE FUND.—Effective as provided in paragraph (4),

15 if, immediately before the merger of the Bank Insur16 ance Fund and the Savings Association Insurance

17 Fund, the reserve ratio of the Savings Association In18 surance Fund exceeds the designated reserve ratio, the

19 amount by which that reserve ratio exceeds the des20 ignated reserve ratio shall be placed in the Special

21 Reserve of the Deposit Insurance Fund, established

22 under section 11(a)(5) of the Federal Deposit Insur23 ance Act, as amended by this subsection.

24 (3) CONFORMING AMENDMENTS.—
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1 (A) DEPOSIT INSURANCE FUND.—Section

2 11(a)(4) of the Federal Deposit Insurance Act

3 (12 U.S.C. 1821(a)(4)) is amended—

4 (i) by redesignating subparagraph (B)

5 as subparagraph (C);

6 (ii) by striking subparagraph (A) and

7 inserting the following:

8 ‘‘(A) ESTABLISHMENT.—There is estab9 lished the Deposit Insurance Fund, which the

10 Corporation shall—

11 ‘‘(i) maintain and administer;

12 ‘‘(ii) use to carry out its insurance

13 purposes in the manner provided by this

14 subsection; and

15 ‘‘(iii) invest in accordance with section

16 13(a).

17 ‘‘(B) USES.—The Deposit Insurance Fund

18 shall be available to the Corporation for use with

19 respect to Deposit Insurance Fund members.’’;

20 and

21 (iii) by striking ‘‘(4) GENERAL PROVI22 SIONS RELATING TO FUNDS.—’’ and insert23 ing the following:

24 ‘‘(4) DEPOSIT INSURANCE FUND.—’’.
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1 (B) OTHER REFERENCES.—Section

2 11(a)(4)(C) of the Federal Deposit Insurance Act

3 (12 U.S.C. 1821(a)(4)(C) (as redesignated by

4 subparagraph (A) of this paragraph)) is amend5 ed by striking ‘‘Bank Insurance Fund and the

6 Savings Association Insurance Fund’’ and in7 serting ‘‘Deposit Insurance Fund’’.

8 (C) DEPOSITS INTO FUND.—Section

9 11(a)(4) of the Federal Deposit Insurance Act

10 (12 U.S.C. 1821(a)(4)) is amended by adding at

11 the end the following new subparagraph:

12 ‘‘(D) DEPOSITS.—All amounts assessed

13 against insured depository institutions by the

14 Corporation shall be deposited in the Deposit In15 surance Fund.’’.

16 (D) SPECIAL RESERVE OF DEPOSITS.—Sec17 tion 11(a)(5) of the Federal Deposit Insurance

18 Act (12 U.S.C. 1821(a)(5)) is amended to read

19 as follows:

20 ‘‘(5) SPECIAL RESERVE OF DEPOSIT INSURANCE

21 FUND.—

22 ‘‘(A) SPECIAL RESERVE OF DEPOSIT INSUR23 ANCE FUND ESTABLISHED.—

24 ‘‘(i) ESTABLISHMENT.—There is estab25 lished a Special Reserve of the Deposit In-
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1 surance Fund, which shall be administered

2 by the Corporation and shall be invested in

3 accordance with section 13(a).

4 ‘‘(ii) LIMITATION.—The Corporation

5 shall not provide any assessment credit, re6 fund, or other payment from any amount

7 in the Special Reserve.

8 ‘‘(B) EMERGENCY USE OF SPECIAL RE9 SERVE.—Notwithstanding subparagraph (A)(ii),

10 the Corporation may, in its sole discretion,

11 transfer amounts from the Special Reserve to the

12 Deposit Insurance Fund, for the purposes set

13 forth in paragraph (4), only if—

14 ‘‘(i) the reserve ratio of the Deposit In15 surance Fund is less than 50 percent of the

16 designated reserve ratio; and

17 ‘‘(ii) the Corporation expects the re18 serve ratio of the Deposit Insurance Fund to

19 remain less than 50 percent of the des20 ignated reserve ratio for each of the next 4

21 calendar quarters.

22 ‘‘(C) EXCLUSION OF SPECIAL RESERVE IN

23 CALCULATING RESERVE RATIO.—Notwithstand24 ing any other provision of law, any amounts in

25 the Special Reserve shall be excluded in calculat-
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1 ing the reserve ratio of the Deposit Insurance

2 Fund under section 7.’’.

3 (E) FEDERAL HOME LOAN BANK ACT.—Sec4 tion 21B(f)(2)(C)(ii) of the Federal Home Loan

5 Bank Act (12 U.S.C. 1441b(f)(2)(C)(ii)) is

6 amended—

7 (i) in subclause (I), by striking ‘‘to

8 Savings Associations Insurance Fund mem9 bers’’ and inserting ‘‘to insured depository

10 institutions, and their successors, which

11 were Savings Association Insurance Fund

12 members on September 1, 1995’’; and

13 (ii) in subclause (II), by striking ‘‘to

14 Savings Associations Insurance Fund mem15 bers’’ and inserting ‘‘to insured depository

16 institutions, and their successors, which

17 were Savings Association Insurance Fund

18 members on September 1, 1995’’.

19 (F) REPEALS.—

20 (i) SECTION 3.—Section 3 of the Fed21 eral Deposit Insurance Act (12 U.S.C.

22 1813) is amended—

23 (I) by striking subsection (y); and

24 (II) by redesignating subsection

25 (z) as subsection (y).
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1 (ii) SECTION 7.—Section 7 of the Fed2 eral Deposit Insurance Act (12 U.S.C.

3 1817) is amended—

4 (I) by striking subsection (l);

5 (II) by redesignating subsections

6 (m) and (n) as subsections (l) and (m),

7 respectively;

8 (III) in subsection (b)(2), by

9 striking subparagraph (B); and

10 (IV) in subsection (b)(2), by redes11 ignating subparagraphs (C) through

12 (H) as subparagraphs (B) through (G),

13 respectively.

14 (iii) SECTION 11.—Section 11(a) of the

15 Federal Deposit Insurance Act (12 U.S.C.

16 1121(a)) is amended—

17 (I) by striking paragraphs (6)

18 and (7); and

19 (II) by redesignating paragraph

20 (8) as paragraph (6).

21 (iv) RATE COMPARABILITY.—Section

22 7(b) of the Federal Deposit Insurance Act

23 (12 U.S.C. 1817(b)) is amended by striking

24 paragraph (8) (as added by subsection (c)

25 of this section).
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1 (4) EFFECTIVE DATE.—This subsection and the

2 amendments made by this subsection and subsection

3 (e) shall become effective on January 1, 1998, if no

4 insured depository institution is a savings association

5 on that date.

6 (e) OTHER TECHNICAL AND CONFORMING AMEND7 MENTS.—

8 (1) SECTION 5136 OF THE REVISED STATUTES.—

9 Paragraph Eleventh of section 5136 of the Revised

10 Statutes (12 U.S.C. 24) is amended in the fifth sen11 tence by striking ‘‘affected deposit insurance fund’’

12 and inserting ‘‘Deposit Insurance Fund’’.

13 (2) INVESTMENTS PROMOTING PUBLIC WELFARE;

14 LIMITATIONS ON AGGREGATE INVESTMENTS.—The 23d

15 undesignated paragraph of section 9 of the Federal

16 Reserve Act (12 U.S.C. 338a) is amended in the

17 fourth sentence, by striking ‘‘affected deposit insur18 ance fund’’ and inserting ‘‘Deposit Insurance Fund’’.

19 (3) ADVANCES TO CRITICALLY

20 UNDERCAPITALIZED DEPOSITORY INSTITUTIONS.—

21 Section 10B(b)(3)(A)(ii) of the Federal Reserve Act

22 (12 U.S.C. 347b(b)(3)(A)(ii)) is amended by striking

23 ‘‘any deposit insurance fund in’’ and inserting ‘‘the

24 Deposit Insurance Fund of’’.
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1 (4) AMENDMENTS TO THE BALANCED BUDGET

2 AND EMERGENCY DEFICIT CONTROL ACT OF 1985.—

3 Section 255(g)(1)(A) of the Balanced Budget and

4 Emergency Deficit Control Act of 1985 (2 U.S.C.

5 905(g)(1)(A)) is amended—

6 (A) by striking ‘‘Bank Insurance Fund’’

7 and inserting ‘‘Deposit Insurance Fund’’; and

8 (B) by striking ‘‘Federal Deposit Insurance

9 Corporation, Savings Association Insurance

10 Fund;’’.

11 (5) AMENDMENTS TO THE FEDERAL HOME LOAN

12 BANK ACT.—The Federal Home Loan Bank Act (12

13 U.S.C. 1421 et seq.) is amended—

14 (A) in section 11(k) (12 U.S.C. 1431(k))—

15 (i) in the subsection heading, by strik16 ing ‘‘SAIF’’ and inserting ‘‘THE DEPOSIT

17 INSURANCE FUND’’; and

18 (ii) by striking ‘‘Savings Association

19 Insurance Fund’’ each place such term ap20 pears and inserting ‘‘Deposit Insurance

21 Fund’’;

22 (B) in section 21A(b)(4)(B) (12 U.S.C.

23 1441a(b)(4)(B)), by striking ‘‘affected deposit in24 surance fund’’ and inserting ‘‘Deposit Insurance

25 Fund’’;
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1 (C) in section 21A(b)(6)(B) (12 U.S.C.

2 1441a(b)(6)(B))—

3 (i) in the subparagraph heading, by

4 striking ‘‘SAIF-INSURED BANKS’’ and in5 serting ‘‘CHARTER CONVERSIONS’’; and

6 (ii) by striking ‘‘Savings Association

7 Insurance Fund member’’ and inserting

8 ‘‘savings association’’;

9 (D) in section 21A(b)(10)(A)(iv)(II) (12

10 U.S.C. 1441a(b)(10)(A)(iv)(II)), by striking

11 ‘‘Savings Association Insurance Fund’’ and in12 serting ‘‘Deposit Insurance Fund’’;

13 (E) in section 21B(e) (12 U.S.C.

14 1441b(e))—

15 (i) in paragraph (5), by inserting ‘‘as

16 of the date of funding’’ after ‘‘Savings Asso17 ciation Insurance Fund members’’ each

18 place such term appears;

19 (ii) by striking paragraph (7); and

20 (iii) by redesignating paragraph (8) as

21 paragraph (7); and

22 (F) in section 21B(k) (12 U.S.C.

23 1441b(k))—

24 (i) by striking paragraph (8); and
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1 (ii) by redesignating paragraphs (9)

2 and (10) as paragraphs (8) and (9), respec3 tively.

4 (6) AMENDMENTS TO THE HOME OWNERS’ LOAN

5 ACT.—The Home Owners’ Loan Act (12 U.S.C. 1461

6 et seq.) is amended—

7 (A) in section 5 (12 U.S.C. 1464)—

8 (i) in subsection (c)(5)(A), by striking

9 ‘‘that is a member of the Bank Insurance

10 Fund’’;

11 (ii) in subsection (c)(6), by striking

12 ‘‘As used in this subsection—’’ and insert13 ing ‘‘For purposes of this subsection, the fol14 lowing definitions shall apply:’’;

15 (iii) in subsection (o)(1), by striking

16 ‘‘that is a Bank Insurance Fund member’’;

17 (iv) in subsection (o)(2)(A), by striking

18 ‘‘a Bank Insurance Fund member until

19 such time as it changes its status to a Sav20 ings Association Insurance Fund member’’

21 and inserting ‘‘insured by the Deposit In22 surance Fund’’;

23 (v) in subsection (t)(5)(D)(iii)(II), by

24 striking ‘‘affected deposit insurance fund’’

25 and inserting ‘‘Deposit Insurance Fund’’;
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1 (vi) in subsection (t)(7)(C)(i)(I), by

2 striking ‘‘affected deposit insurance fund’’

3 and inserting ‘‘Deposit Insurance Fund’’;

4 and

5 (vii) in subsection (v)(2)(A)(i), by

6 striking ‘‘, the Savings Association Insur7 ance Fund’’ and inserting ‘‘or the Deposit

8 Insurance Fund’’; and

9 (B) in section 10 (12 U.S.C. 1467a)—

10 (i) in subsection (e)(1)(A)(iii)(VII), by

11 adding ‘‘or’’ at the end;

12 (ii) in subsection (e)(1)(A)(iv), by add13 ing ‘‘and’’ at the end;

14 (iii) in subsection (e)(1)(B), by strik15 ing ‘‘Savings Association Insurance Fund

16 or Bank Insurance Fund’’ and inserting

17 ‘‘Deposit Insurance Fund’’;

18 (iv) in subsection (e)(2), by striking

19 ‘‘Savings Association Insurance Fund or

20 the Bank Insurance Fund’’ and inserting

21 ‘‘Deposit Insurance Fund’’; and

22 (v) in subsection (m)(3), by striking

23 subparagraph (E), and by redesignating

24 subparagraphs (F), (G), and (H) as sub25 paragraphs (E), (F), and (G), respectively.
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1 (7) AMENDMENTS TO THE NATIONAL HOUSING

2 ACT.—The National Housing Act (12 U.S.C. 1701 et

3 seq.) is amended—

4 (A) in section 317(b)(1)(B) (12 U.S.C.

5 1723i(b)(1)(B)), by striking ‘‘Bank Insurance

6 Fund for banks or through the Savings Associa7 tion Insurance Fund for savings associations’’

8 and inserting ‘‘Deposit Insurance Fund’’; and

9 (B) in section 526(b)(1)(B)(ii) (12 U.S.C.

10 1735f–14(b)(1)(B)(ii)), by striking ‘‘Bank Insur11 ance Fund for banks and through the Savings

12 Association Insurance Fund for savings associa13 tions’’ and inserting ‘‘Deposit Insurance Fund’’.

14 (8) AMENDMENTS TO THE FEDERAL DEPOSIT IN15 SURANCE ACT.—The Federal Deposit Insurance Act

16 (12 U.S.C. 1811 et seq.) is amended—

17 (A) in section 3(a)(1) (12 U.S.C.

18 1813(a)(1)), by striking subparagraph (B) and

19 inserting the following:

20 ‘‘(B) includes any former savings associa21 tion.’’;

22 (B) in section 5(b)(5) (12 U.S.C.

23 1815(b)(5)), by striking ‘‘the Bank Insurance

24 Fund or the Savings Association Insurance
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1 Fund;’’ and inserting ‘‘Deposit Insurance

2 Fund,’’;

3 (C) in section 5(d) (12 U.S.C. 1815(d)), by

4 striking paragraphs (2) and (3);

5 (D) in section 5(d)(1) (12 U.S.C.

6 1815(d)(1))—

7 (i) in subparagraph (A), by striking

8 ‘‘reserve ratios in the Bank Insurance Fund

9 and the Savings Association Insurance

10 Fund’’ and inserting ‘‘the reserve ratio of

11 the Deposit Insurance Fund’’;

12 (ii) by striking subparagraph (B) and

13 inserting the following:

14 ‘‘(2) FEE CREDITED TO THE DEPOSIT INSUR15 ANCE FUND.—The fee paid by the depository institu16 tion under paragraph (1) shall be credited to the De17 posit Insurance Fund.’’;

18 (iii) by striking ‘‘(1) UNINSURED IN19 STITUTIONS.—’’; and

20 (iv) by redesignating subparagraphs

21 (A) and (C) as paragraphs (1) and (3), re22 spectively and moving the margins 2 ems to

23 the left;

24 (E) in section 5(e) (12 U.S.C. 1815(e))—
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1 (i) in paragraph (5)(A), by striking

2 ‘‘Bank Insurance Fund or the Savings Asso3 ciation Insurance Fund’’ and inserting

4 ‘‘Deposit Insurance Fund’’;

5 (ii) by striking paragraph (6); and

6 (iii) by redesignating paragraphs (7),

7 (8), and (9) as paragraphs (6), (7), and (8),

8 respectively;

9 (F) in section 6(5) (12 U.S.C. 1816(5)), by

10 striking ‘‘Bank Insurance Fund or the Savings

11 Association Insurance Fund’’ and inserting ‘‘De12 posit Insurance Fund’’;

13 (G) in section 7(b) (12 U.S.C. 1817(b))—

14 (i) in paragraph (1)(D), by striking

15 ‘‘each deposit insurance fund’’ and insert16 ing ‘‘the Deposit Insurance Fund’’;

17 (ii) in clauses (i)(I) and (iv) of para18 graph (2)(A), by striking ‘‘each deposit in19 surance fund’’ each place such term appears

20 and inserting ‘‘the Deposit Insurance

21 Fund’’;

22 (iii) in paragraph (2)(A)(iii), by strik23 ing ‘‘a deposit insurance fund’’ and insert24 ing ‘‘the Deposit Insurance Fund’’;
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1 (iv) in paragraph (2)(D) (as redesig2 nated by section 3001(d)(3)(F)(ii)(IV) of

3 this Act)—

4 (I) by striking ‘‘any deposit in5 surance fund’’ and inserting ‘‘the De6 posit Insurance Fund’’; and

7 (II) by striking ‘‘that fund’’ each

8 place such term appears and inserting

9 ‘‘the Deposit Insurance Fund’’;

10 (v) by striking paragraph (2)(E) (as

11 redesignated by section

12 3001(d)(3)(F)(ii)(IV) of this Act);

13 (vi) in paragraph (2)(F) (as redesig14 nated by section 3001(d)(3)(F)(ii)(IV) of

15 this Act)—

16 (I) in the subparagraph heading,

17 by striking ‘‘FUNDS ACHIEVE’’ and in18 serting ‘‘FUND ACHIEVES’’; and

19 (II) by striking ‘‘a deposit insur20 ance fund’’ and inserting ‘‘the Deposit

21 Insurance Fund’’;

22 (vii) in paragraph (3)—

23 (I) in the paragraph heading, by

24 striking ‘‘FUNDS’’ and inserting

25 ‘‘FUND’’;
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1 (II) by striking ‘‘that fund’’ each

2 place such term appears and inserting

3 ‘‘the Deposit Insurance Fund’’;

4 (III) in subparagraph (A), by

5 striking ‘‘Except as provided in para6 graph (2)(F), if’’ and inserting ‘‘If’’;

7 (IV) in subparagraph (A), by

8 striking ‘‘any deposit insurance fund’’

9 and inserting ‘‘the Deposit Insurance

10 Fund’’; and

11 (V) by striking subparagraphs (C)

12 and (D) and inserting the following:

13 ‘‘(C) AMENDING SCHEDULE.—The Corpora14 tion may, by regulation, amend a schedule pro15 mulgated under subparagraph (B).’’; and

16 (viii) in paragraph (6)—

17 (I) by striking ‘‘any such assess18 ment’’ and inserting ‘‘any such assess19 ment is necessary’’;

20 (II) by striking ‘‘(A) is nec21 essary—’’;

22 (III) by striking subparagraph

23 (B);

24 (IV) by redesignating clauses (i),

25 (ii), and (iii) as subparagraphs (A),
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1 (B), and (C), respectively, and moving

2 the margins 2 ems to the left; and

3 (V) in subparagraph (C) (as re4 designated), by striking ‘‘; and’’ and

5 inserting a period;

6 (H) in section 7(d) (12 U.S.C. 1817(d)) (as

7 added by section 3001(c)(1) of this Act)—

8 (i) in the subsection heading, by strik9 ing ‘‘BANK’’ and inserting ‘‘DEPOSIT’’; and

10 (ii) by striking ‘‘Bank Insurance

11 Fund’’ each place such term appears and

12 inserting ‘‘Deposit Insurance Fund’’;

13 (I) in section 11(f)(1) (12 U.S.C.

14 1821(f)(1)), by striking ‘‘, except that—’’ and all

15 that follows through the end of the paragraph

16 and inserting a period;

17 (J) in section 11(i)(3) (12 U.S.C.

18 1821(i)(3))—

19 (i) by striking subparagraph (B);

20 (ii) by redesignating subparagraph (C)

21 as subparagraph (B); and

22 (iii) in subparagraph (B) (as redesig23 nated), by striking ‘‘subparagraphs (A) and

24 (B)’’ and inserting ‘‘subparagraph (A)’’;
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1 (K) in section 11A(a) (12 U.S.C.

2 1821a(a))—

3 (i) in paragraph (2), by striking ‘‘LI4 ABILITIES.—’’ and all that follows through

5 ‘‘Except’’ and inserting ‘‘LIABILITIES.—Ex6 cept’’;

7 (ii) by striking paragraph (2)(B); and

8 (iii) in paragraph (3), by striking ‘‘the

9 Bank Insurance Fund, the Savings Associa10 tion Insurance Fund,’’ and inserting ‘‘the

11 Deposit Insurance Fund’’;

12 (L) in section 11A(b) (12 U.S.C. 1821a(b)),

13 by striking paragraph (4);

14 (M) in section 11A(f) (12 U.S.C. 1821a(f)),

15 by striking ‘‘Savings Association Insurance

16 Fund’’ and inserting ‘‘Deposit Insurance Fund’’;

17 (N) in section 13 (12 U.S.C. 1823)—

18 (i) in subsection (a)(1), by striking

19 ‘‘Bank Insurance Fund, the Savings Asso20 ciation Insurance Fund,’’ and inserting

21 ‘‘Deposit Insurance Fund, the Special Re22 serve of the Deposit Insurance Fund,’’;

23 (ii) in subsection (c)(4)(E)—
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1 (I) in the subparagraph heading,

2 by striking ‘‘FUNDS’’ and inserting

3 ‘‘FUND’’; and

4 (II) in clause (i), by striking

5 ‘‘any insurance fund’’ and inserting

6 ‘‘the Deposit Insurance Fund’’;

7 (iii) in subsection (c)(4)(G)(ii)—

8 (I) by striking ‘‘appropriate in9 surance fund’’ and inserting ‘‘Deposit

10 Insurance Fund’’;

11 (II) by striking ‘‘the members of

12 the insurance fund (of which such in13 stitution is a member)’’ and inserting

14 ‘‘insured depository institutions’’;

15 (III) by striking ‘‘each member’s’’

16 and inserting ‘‘each insured depository

17 institution’s’’; and

18 (IV) by striking ‘‘the member’s’’

19 each place such term appears and in20 serting ‘‘the institution’s’’;

21 (iv) in subsection (c), by striking para22 graph (11);

23 (v) in subsection (h), by striking

24 ‘‘Bank Insurance Fund’’ and inserting ‘‘De25 posit Insurance Fund’’;
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1 (vi) in subsection (k)(4)(B)(i), by

2 striking ‘‘Savings Association Insurance

3 Fund’’ and inserting ‘‘Deposit Insurance

4 Fund’’; and

5 (vii) in subsection (k)(5)(A), by strik6 ing ‘‘Savings Association Insurance Fund’’

7 and inserting ‘‘Deposit Insurance Fund’’;

8 (O) in section 14(a) (12 U.S.C. 1824(a)) in

9 the fifth sentence—

10 (i) by striking ‘‘Bank Insurance Fund

11 or the Savings Association Insurance

12 Fund’’ and inserting ‘‘Deposit Insurance

13 Fund’’; and

14 (ii) by striking ‘‘each such fund’’ and

15 inserting ‘‘the Deposit Insurance Fund’’;

16 (P) in section 14(b) (12 U.S.C. 1824(b)), by

17 striking ‘‘Bank Insurance Fund or Savings Asso18 ciation Insurance Fund’’ and inserting ‘‘Deposit

19 Insurance Fund’’;

20 (Q) in section 14(c) (12 U.S.C. 1824(c)), by

21 striking paragraph (3);

22 (R) in section 14(d) (12 U.S.C. 1824(d))—

23 (i) by striking ‘‘BIF’’ each place such

24 term appears and inserting ‘‘DIF’’; and
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1 (ii) by striking ‘‘Bank Insurance

2 Fund’’ each place such term appears and

3 inserting ‘‘Deposit Insurance Fund’’;

4 (S) in section 15(c)(5) (12 U.S.C.

5 1825(c)(5))—

6 (i) by striking ‘‘the Bank Insurance

7 Fund or Savings Association Insurance

8 Fund, respectively’’ each place such term

9 appears and inserting ‘‘the Deposit Insur10 ance Fund’’; and

11 (ii) in subparagraph (B), by striking

12 ‘‘the Bank Insurance Fund or the Savings

13 Association Insurance Fund, respectively’’

14 and inserting ‘‘the Deposit Insurance

15 Fund’’;

16 (T) in section 17(a) (12 U.S.C. 1827(a))—

17 (i) in the subsection heading, by strik18 ing ‘‘BIF, SAIF,’’ and inserting ‘‘THE DE19 POSIT INSURANCE FUND’’; and

20 (ii) in paragraph (1), by striking ‘‘the

21 Bank Insurance Fund, the Savings Associa22 tion Insurance Fund,’’ each place such term

23 appears and inserting ‘‘the Deposit Insur24 ance Fund’’;
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1 (U) in section 17(d) (12 U.S.C. 1827(d)),

2 by striking ‘‘the Bank Insurance Fund, the Sav3 ings Association Insurance Fund,’’ each place

4 such term appears and inserting ‘‘the Deposit

5 Insurance Fund’’;

6 (V) in section 18(m)(3) (12 U.S.C.

7 1828(m)(3))—

8 (i) by striking ‘‘Savings Association

9 Insurance Fund’’ each place such term ap10 pears and inserting ‘‘Deposit Insurance

11 Fund’’; and

12 (ii) in subparagraph (C), by striking

13 ‘‘or the Bank Insurance Fund’’;

14 (W) in section 18(p) (12 U.S.C. 1828(p)),

15 by striking ‘‘deposit insurance funds’’ and in16 serting ‘‘Deposit Insurance Fund’’;

17 (X) in section 24 (12 U.S.C. 1831a) in sub18 sections (a)(1) and (d)(1)(A), by striking ‘‘ap19 propriate deposit insurance fund’’ each place

20 such term appears and inserting ‘‘Deposit Insur21 ance Fund’’;

22 (Y) in section 28 (12 U.S.C. 1831e), by

23 striking ‘‘affected deposit insurance fund’’ each

24 place such term appears and inserting ‘‘Deposit

25 Insurance Fund’’;
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1 (Z) by striking section 31 (12 U.S.C.

2 1831h);

3 (AA) in section 36(i)(3) (12 U.S.C.

4 1831m(i)(3)) by striking ‘‘affected deposit insur5 ance fund’’ and inserting ‘‘Deposit Insurance

6 Fund’’;

7 (BB) in section 38(a) (12 U.S.C. 1831o(a))

8 in the subsection heading, by striking ‘‘FUNDS’’

9 and inserting ‘‘FUND’’;

10 (CC) in section 38(k) (12 U.S.C.

11 1831o(k))—

12 (i) in paragraph (1), by striking ‘‘a

13 deposit insurance fund’’ and inserting ‘‘the

14 Deposit Insurance Fund’’; and

15 (ii) in paragraph (2)(A)—

16 (I) by striking ‘‘A deposit insur17 ance fund’’ and inserting ‘‘The Deposit

18 Insurance Fund’’; and

19 (II) by striking ‘‘the deposit in20 surance fund’s outlays’’ and inserting

21 ‘‘the outlays of the Deposit Insurance

22 Fund’’; and

23 (DD) in section 38(o) (12 U.S.C.

24 1831o(o))—
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1 (i) by striking ‘‘ASSOCIATIONS.—’’ and

2 all that follows through ‘‘Subsections (e)(2)’’

3 and inserting ‘‘ASSOCIATIONS.—Subsections

4 (e)(2)’’;

5 (ii) by redesignating subparagraphs

6 (A), (B), and (C) as paragraphs (1), (2),

7 and (3), respectively; and

8 (iii) in paragraph (1) (as redesig9 nated), by redesignating clauses (i) and (ii)

10 as subparagraphs (A) and (B), respectively.

11 (9) AMENDMENTS TO THE FINANCIAL INSTITU12 TIONS REFORM, RECOVERY, AND ENFORCEMENT ACT

13 OF 1989.—The Financial Institutions Reform, Recov14 ery, and Enforcement Act (Public Law 101–73; 103

15 Stat. 183) is amended—

16 (A) in section 951(b)(3)(B) (12 U.S.C.

17 1833a(b)(3)(B)), by striking ‘‘Bank Insurance

18 Fund, the Savings Association Insurance Fund,’’

19 and inserting ‘‘Deposit Insurance Fund’’; and

20 (B) in section 1112(c)(1)(B) (12 U.S.C.

21 3341(c)(1)(B)), by striking ‘‘Bank Insurance

22 Fund, the Savings Association Insurance Fund,’’

23 and inserting ‘‘Deposit Insurance Fund’’.

24 (10) AMENDMENT TO THE BANK ENTERPRISE

25 ACT OF 1991.—Section 232(a)(1) of the Bank Enter-
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1 prise Act of 1991 (12 U.S.C. 1834(a)(1)) is amended

2 by striking ‘‘section 7(b)(2)(H)’’ and inserting ‘‘sec3 tion 7(b)(2)(G)’’.

4 (11) AMENDMENT TO THE BANK HOLDING COM5 PANY ACT.—Section 2(j)(2) of the Bank Holding

6 Company Act (12 U.S.C. 1841(j)(2)) is amended by

7 striking ‘‘Savings Association Insurance Fund’’ and

8 inserting ‘‘Deposit Insurance Fund’’.

9 (f) DEFINITIONS.—For purposes of this section—

10 (1) the term ‘‘Bank Insurance Fund’’ means the

11 fund established pursuant to section (11)(a)(5)(A) of

12 the Federal Deposit Insurance Act, as that section ex13 isted on the day before the date of enactment of this

14 Act;

15 (2) the terms ‘‘Board of Directors’’, ‘‘Corpora16 tion’’, ‘‘insured depository institution’’, ‘‘Federal sav17 ings association’’, ‘‘savings association’’, ‘‘State sav18 ings bank’’, and ‘‘State depository institution’’ have

19 the same meanings as in section 3 of the Federal De20 posit Insurance Act;

21 (3) the term ‘‘Deposit Insurance Fund’’ means

22 the fund established under section 11(a)(4) of the Fed23 eral Deposit Insurance Act, as amended by subsection

24 (d) of this section;
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1 (4) the term ‘‘designated reserve ratio’’ has the

2 same meaning as in section 7(b)(2)(A)(iv) of the Fed3 eral Deposit Insurance Act;

4 (5) the term ‘‘Savings Association Insurance

5 Fund’’ means the fund established pursuant to section

6 11(a)(6)(A) of the Federal Deposit Insurance Act, as

7 that section existed on the day before the date of en8 actment of this Act; and

9 (5) the term ‘‘SAIF-assessable deposit’’ means—

10 (A) a deposit that is subject to assessment

11 for purposes of the Savings Association Insur12 ance Fund under the Federal Deposit Insurance

13 Act; and

14 (B) a deposit that section 5(d)(3) of the

15 Federal Deposit Insurance Act treats as insured

16 by the Savings Association Insurance Fund.

17 SEC. 3002. ANNUAL ADJUSTMENT FACTORS FOR OPERAT18 ING COSTS ONLY; RESTRAINT ON SECTION 8

19 RENT INCREASES FOR STAYERS IN THE CER20 TIFICATE PROGRAM.

21 (a) ANNUAL ADJUSTMENT FACTORS FOR OPERATING

22 COSTS ONLY.—Section 8(c)(2)(A) of the United States

23 Housing Act of 1937 (42 U.S.C. 1437f(c)(2)(A)) is amend24 ed—
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1 (1) by striking ‘‘(2)(A)’’ and inserting

2 ‘‘(2)(A)(i)’’;

3 (2) by striking the second sentence and all that

4 follows through the end of the subparagraph; and

5 (3) by adding at the end the following new

6 clause:

7 ‘‘(ii)(I) Except as provided in subclause (II), if the

8 maximum monthly rent for a unit in a new construction

9 or substantial rehabilitation project to be adjusted using an

10 annual adjustment factor exceeds 100 percent of the fair

11 market rent for an existing dwelling unit in the market

12 area, the Secretary shall adjust the rent using an operating

13 costs factor that increases the rent to reflect increases in

14 operating costs in the market area.

15 ‘‘(II) If the owner of a unit in a project described in

16 subclause (I) demonstrates that the adjusted rent deter17 mined under subclause (I) would not exceed the rent for

18 an unassisted unit of similar quality, type, and age in the

19 same market area, as determined by the Secretary, the Sec20 retary shall use the otherwise applicable annual adjustment

21 factor.’’.

22 (b) RESTRAINT ON SECTION 8 RENT INCREASES FOR

23 STAYERS IN THE CERTIFICATE PROGRAM.—Section

24 8(c)(2)(A) of the United States Housing Act of 1937 (42
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1 U.S.C. 1437f(c)(2)(A)), as amended by subsection (a), is

2 amended by adding at the end the following new clause:

3 ‘‘(iii) In the case of assistance under the certificate

4 program under this section, 0.01 shall be subtracted from

5 the amount of the annual adjustment factor, except that the

6 annual adjustment factor shall not be reduced to less than

7 1.0.’’.

8 (c) APPLICABILITY.—The amendments made by sub9 section (a) shall apply to all contracts for new construction

10 or substantial rehabilitation projects under which rents are

11 adjusted under section 8(c)(2)(A) of the United States

12 Housing Act of 1937, by applying an annual adjustment

13 factor.

14 (d) EFFECTIVE DATE.—The amendments made by

15 subsections (a) and (b) shall become effective on October 1,

16 1996.

17 SEC. 3003. WORKING FAMILY PREFERENCE FOR ADMISSION

18 TO ASSISTED HOUSING.

19 Section 8(d)(1)(A)(i) of the United States Housing Act

20 of 1937 (42 U.S.C. 1437f(d)(1)(A)(i)) is amended to read

21 as follows:

22 ‘‘(i) provide that not less than 50 per23 cent of the units shall be made available for

24 occupancy by families that include one or
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1 more adult members who are employed on a

2 full- or part-time basis;’’.

3 SEC. 3004. AMENDMENTS TO THE CIVIL WAR BATTLEFIELD

4 COMMEMORATIVE COIN ACT OF 1992.

5 (a) DISTRIBUTION AND USE OF SURCHARGES.—

6 (1) IN GENERAL.—Section 6 of the Civil War

7 Battlefield Commemorative Coin Act of 1992 (31

8 U.S.C. 5112 note) is amended to read as follows:

9 ‘‘SEC. 6. DISTRIBUTION AND USE OF SURCHARGES.

10 ‘‘(a) DISTRIBUTION.—An amount equal to $5,300,000

11 of the surcharges received by the Secretary from the sale

12 of coins issued under this Act shall be promptly paid by

13 the Secretary to the Association for the Preservation of Civil

14 War Sites, Incorporated (hereafter in this Act referred to

15 as the ‘Association’), to be used for the acquisition of his16 torically significant and threatened Civil War sites selected

17 by the Association.

18 ‘‘(b) CIVIL WAR SITES INCLUDED.—In using amounts

19 paid to the Association under subsection (a), the Association

20 may spend—

21 ‘‘(1) not more than $500,000 to acquire sites at

22 Malvern Hill, Virginia;

23 ‘‘(2) not more than $1,000,000 to acquire sites at

24 Cornith, Mississippi;
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1 ‘‘(3) not more than $300,000 to acquire sites at

2 Spring Hill, Tennessee;

3 ‘‘(4) not more than $1,000,000 to acquire sites at

4 Winchester, Virginia;

5 ‘‘(5) not more than $500,000 to acquire sites at

6 Resaca, Georgia;

7 ‘‘(6) not more than $250,000 to acquire sites at

8 Brice’s Cross Roads, Mississippi;

9 ‘‘(7) not more than $250,000 to acquire sites at

10 Perryville, Kentucky;

11 ‘‘(8) not more than $1,000,000 to acquire sites at

12 Brandy Station, Virginia;

13 ‘‘(9) not more than $250,000 to acquire sites at

14 Kernstown, Virginia; and

15 ‘‘(10) not more than $250,000 to acquire sites at

16 Glendale, Virginia.’’.

17 (2) TRANSFER OF SURCHARGES.—

18 (A) TO TREASURY.—Not later than 10 days

19 after the date of enactment of this Act, the Civil

20 War Trust, formerly called the Civil War Battle21 field Foundation (hereafter in this section re22 ferred to as the ‘‘Foundation’’) shall transfer to

23 the Secretary of the Treasury an amount equal

24 to $5,300,000.
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1 (B) TO THE ASSOCIATION.—Not later than

2 10 days after the transfer under subparagraph

3 (A) is completed, the Secretary of the Treasury

4 shall transfer to the Association an amount equal

5 to the amount transferred under subparagraph

6 (A).

7 TITLE IV—COMMITTEE ON COM8 MERCE, SCIENCE, AND TRANS9 PORTATION

10 Subtitle A—Communications

11 SEC. 4001. SPECTRUM AUCTIONS.

12 (a) EXTENSION AND EXPANSION OF AUCTION AUTHOR13 ITY.—

14 (1) AMENDMENTS.—Section 309(j) of the Com15 munications Act of 1934 (47 U.S.C. 309(j)) is amend16 ed—

17 (A) by striking paragraphs (1) and (2) and

18 inserting the following:

19 ‘‘(1) GENERAL AUTHORITY.—If, consistent with

20 the obligations described in paragraph (6)(E), mutu21 ally exclusive applications are accepted for any ini22 tial license or construction permit which will involve

23 an exclusive use of the electromagnetic spectrum, then

24 the Commission shall grant such license or permit to
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1 a qualified applicant through a system of competitive

2 bidding that meets the requirements of this subsection.

3 ‘‘(2) EXCEPTIONS.—The competitive bidding au4 thority granted by this subsection shall not apply to

5 licenses or construction permits issued by the Com6 mission—

7 ‘‘(A) that, as the result of the Commission

8 carrying out the obligations described in para9 graph (6)(E), are not mutually exclusive;

10 ‘‘(B) for public safety radio services, includ11 ing non-Government uses that protect the safety

12 of life, health, and property and that are not

13 made commercially available to the public; or

14 ‘‘(C) for initial licenses or construction per15 mits for new terrestrial digital television services

16 assigned by the Commission to existing terres17 trial broadcast licensees to replace their existing

18 television licenses, unless the Commission—

19 ‘‘(i) not later than 180 days after the

20 date of enactment of the Omnibus Budget

21 Reconciliation Act of 1995, after notice and

22 public comment, submits to Congress a pro23 posal to use the authority provided in this

24 subsection for the assignment of initial li25 censes or construction permits for use of the
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1 electromagnetic spectrum allocated but not

2 assigned as of the date of enactment of that

3 Act for television broadcast services; and

4 ‘‘(ii) the Congress takes action to ap5 prove the plan or to authorize the use of the

6 authority provided by this subsection for

7 such licenses or permits.

8 Except as provided in this subparagraph, the

9 Commission may not assign initial licenses or

10 construction permits under this title to terres11 trial commercial television broadcast licensees to

12 replace their existing broadcast licenses before

13 January 1, 1998.’’; and

14 (B) by striking ‘‘1998’’ in paragraph (11)

15 and inserting ‘‘2002’’.

16 (2) CONFORMING AMENDMENT.—Subsection (i) of

17 section 309 of such Act is repealed.

18 (b) COMMISSION OBLIGATION TO MAKE ADDITIONAL

19 SPECTRUM AVAILABLE BY AUCTION.—

20 (1) IN GENERAL.—The Federal Communications

21 Commission shall complete all actions necessary to

22 permit the assignment, by September 30, 2002, by

23 competitive bidding pursuant to section 309(j) of the

24 Communications Act of 1934 (47 U.S.C. 309(j)) of li25 censes for the use of bands of frequencies that—
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1 (A) individually span not less than 25

2 megahertz, unless a combination of smaller

3 bands can, notwithstanding the provisions of

4 paragraph (7) of such section, reasonably be ex5 pected to produce greater receipts;

6 (B) in the aggregate span not less than 100

7 megahertz;

8 (C) are located below 3 gigahertz; and

9 (D) have not, as of the date of enactment of

10 this Act—

11 (i) been assigned or designated by

12 Commission regulation for assignment pur13 suant to such section;

14 (ii) been identified by the Secretary of

15 Commerce pursuant to section 113 of the

16 National Telecommunications and Informa17 tion Administration Organization Act (47

18 U.S.C. 923); or

19 (iii) reserved for Federal Government

20 use pursuant to section 305 of the Commu21 nications Act of 1934 (47 U.S.C. 305).

22 The Commission shall conduct the competitive

23 bidding for not less than one-half of such aggre24 gate spectrum by September 30, 2000.
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1 (2) CRITERIA FOR REASSIGNMENT.—In making

2 available bands of frequencies for competitive bidding

3 pursuant to paragraph (1), the Commission shall—

4 (A) seek to promote the most efficient use of

5 the spectrum;

6 (B) take into account the cost to incumbent

7 licensees of relocating existing uses to other

8 bands of frequencies or other means of commu9 nication;

10 (C) take into account the needs of public

11 safety radio services;

12 (D) comply with the requirements of inter13 national agreements concerning spectrum alloca14 tions; and

15 (E) take into account the costs to satellite

16 service providers that could result from multiple

17 auctions of like spectrum internationally for

18 global satellite systems.

19 (3) NOTIFICATION TO NTIA.—The Commission

20 shall notify the Secretary of Commerce if—

21 (A) the Commission is not able to provide

22 for the effective relocation of incumbent licensees

23 to bands of frequencies that are available to the

24 Commission for assignment; and
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1 (B) the Commission has identified bands of

2 frequencies that are—

3 (i) suitable for the relocation of such li4 censees; and

5 (ii) allocated for Federal Government

6 use, but that could be reallocated pursuant

7 to part B of the National Telecommuni8 cations and Information Administration

9 Organization Act (47 U.S.C. 921 et seq.), as

10 amended by this Act.

11 (c) IDENTIFICATION AND REALLOCATION OF FRE12 QUENCIES; RELOCATION OF FEDERAL GOVERNMENT STA13 TIONS.—The National Telecommunications and Informa14 tion Administration Organization Act (47 U.S.C. 901 et

15 seq.) is amended—

16 (1) by adding at the end of section 113 the fol17 lowing:

18 ‘‘(f) ADDITIONAL REALLOCATION REPORT.—If the Sec19 retary receives a notice from the Commission pursuant to

20 section 4001(b)(3) of the Omnibus Budget Reconciliation

21 Act of 1995, the Secretary shall prepare and submit to the

22 President and the Congress a report recommending for

23 reallocation for use other than by Federal Government sta24 tions under section 305 of the 1934 Act (47 U.S.C. 305),
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1 bands of frequencies that are suitable for the uses identified

2 in the Commission’s notice.

3 ‘‘(g) RELOCATION OF FEDERAL GOVERNMENT STA4 TIONS.—

5 ‘‘(1) IN GENERAL.—In order to expedite the effi6 cient use of the electromagnetic spectrum and not7 withstanding section 3302(b) of title 31, United

8 States Code, any Federal entity which operates a Fed9 eral Government station may accept payment in ad10 vance or in-kind reimbursement of costs, or a com11 bination of payment in advance and in-kind reim12 bursement, from any person to defray entirely the ex13 penses of relocating the Federal entity’s operations

14 from one or more radio spectrum frequencies to any

15 other frequency or frequencies, including, without lim16 itation, the costs of any modification, replacement, or

17 reissuance of equipment, facilities, operating manu18 als, regulations, or other expenses incurred by that

19 entity. Any such payment shall be deposited in the

20 account of such Federal entity in the Treasury of the

21 United States. Funds deposited according to this sec22 tion shall be available, without appropriation or fis23 cal year limitation, only for the operations of the

24 Federal entity for which such funds were deposited

25 under this section.
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1 ‘‘(2) PROCESS FOR RELOCATION.—Any person

2 seeking to relocate a Federal Government station that

3 has been assigned a frequency within a band allocated

4 for mixed Federal and non-Federal use may submit

5 a petition for such relocation to NTIA. The NTIA

6 shall limit the Federal Government station’s operat7 ing license to secondary status when the following re8 quirements are met—

9 ‘‘(A) the person seeking relocation of the

10 Federal Government station has guaranteed to

11 defray entirely, through payment in advance, in12 kind reimbursement of costs, or a combination

13 thereof, all relocation costs incurred by the Fed14 eral entity, including all engineering, equipment,

15 site acquisition and construction, and regulatory

16 fee costs;

17 ‘‘(B) the person seeking relocation completes

18 all activities necessary for implementing the relo19 cation, including construction of replacement fa20 cilities (if necessary and appropriate) and iden21 tifying and obtaining on the Federal entity’s be22 half new frequencies for use by the relocated Fed23 eral Government station (where such station is

24 not relocating to spectrum reserved exclusively

25 for Federal use);
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1 ‘‘(C) any necessary replacement facilities,

2 equipment modifications, or other changes have

3 been implemented and tested to ensure that the

4 Federal Government station is able to success5 fully accomplish its purposes; and

6 ‘‘(D) NTIA has determined that the pro7 posed use of the spectrum frequency band to

8 which the Federal entity will relocate its oper9 ations is—

10 ‘‘(i) consistent with obligations under11 taken by the United States in international

12 agreements and with United States national

13 security and public safety interests; and

14 ‘‘(ii) suitable for the technical charac15 teristics of the band and consistent with

16 other uses of the band.

17 In exercising its authority under subparagraph

18 (D) with respect to issues that could have na19 tional security or foreign relations implications,

20 NTIA shall consult with the Secretary of Defense

21 or the Secretary of State, or both, as appro22 priate.

23 ‘‘(3) RIGHT TO RECLAIM.—If within one year

24 after the relocation the Federal Government station

25 demonstrates to the Commission that the new facili-
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1 ties or spectrum are not comparable to the facilities

2 or spectrum from which the Federal Government sta3 tion was relocated, the person seeking such relocation

4 must take reasonable steps to remedy any defects or

5 pay the Federal entity for the costs of returning the

6 Federal Government station to the spectrum from

7 which such station was relocated.

8 ‘‘(h) FEDERAL ACTION TO EXPEDITE SPECTRUM

9 TRANSFER.—Any Federal Government station which oper10 ates on electromagnetic spectrum that has been identified

11 for reallocation for mixed Federal and non-Federal use in

12 the Spectrum Reallocation Final Report shall, to the maxi13 mum extent practicable through the use of the authority

14 granted under subsection (g) and any other applicable pro15 vision of law, take action to relocate its spectrum use to

16 other frequencies that are reserved for Federal use or to con17 solidate its spectrum use with other Federal Government

18 stations in a manner that maximizes the spectrum avail19 able for non-Federal use. Subsection (c)(4) of this section

20 shall not apply to the extent that a non-Federal user seeks

21 to relocate or relocates a Federal power agency under sub22 section (g).

23 ‘‘(i) DEFINITIONS.—For purposes of this section—

24 ‘‘(1) FEDERAL ENTITY.—The term ‘Federal en25 tity’ means any Department, agency, or other element
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1 of the Federal Government that utilizes radio fre2 quency spectrum in the conduct of its authorized ac3 tivities, including a Federal power agency.

4 ‘‘(2) SPECTRUM REALLOCATION FINAL RE5 PORT.—The term ‘Spectrum Reallocation Final Re6 port’ means the report submitted by the Secretary to

7 the President and Congress in compliance with the re8 quirements of subsection (a).’’; and

9 (2) by striking ‘‘(a) or (d)(1)’’ in section

10 114(a)(1) and inserting ‘‘(a), (d)(1), or (f)’’.

11 (d) IDENTIFICATION AND REALLOCATION OF

12 AUCTIONABLE FREQUENCIES.—The National Tele13 communications and Information Administration Organi14 zation Act (47 U.S.C. 901 et seq.), as amended by this Act,

15 is amended—

16 (1) by striking the heading of paragraph (1) of

17 section 113(b) and inserting ‘‘INITIAL REALLOCATION

18 REPORT.—’’;

19 (2) by inserting ‘‘in the first report required by

20 subsection (a)’’ after ‘‘recommend for reallocation’’ in

21 such paragraph;

22 (3) by inserting ‘‘or (3)’’ after ‘‘paragraph (1)’’

23 each place it appears in paragraph (2) of section

24 113(b);
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1 (4) by adding at the end of section 113(b) the

2 following:

3 ‘‘(3) SECOND REALLOCATION REPORT.—In ac4 cordance with the provisions of this section, the Sec5 retary shall recommend for reallocation for use other

6 than by Federal Government stations under section

7 305 of the 1934 Act (47 U.S.C. 305), a single fre8 quency band that spans not less than an additional

9 20 megahertz, that is located below 3 gigahertz, and

10 that meets the criteria specified in paragraphs (1)

11 through (5) of subsection (a).’’;

12 (5) by striking ‘‘the report required by section

13 113(a)’’ in section 115(b) and inserting ‘‘the initial

14 reallocation report required by section 113(a)’’; and

15 (6) by adding at the end of section 115 the fol16 lowing:

17 ‘‘(c) ALLOCATION AND ASSIGNMENT OF FREQUENCIES

18 IDENTIFIED IN THE SECOND REALLOCATION REPORT.—

19 With respect to the frequencies made available for

20 reallocation pursuant to section 113(b)(3), the Commission

21 shall, not later than 1 year after receipt of the second

22 reallocation report required by such section, prepare, sub23 mit to the President and the Congress, and implement, a

24 plan for the allocation and assignment under the 1934 Act

25 of such frequencies. Such plan shall propose the immediate
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1 allocation and assignment of all such frequencies in accord2 ance with section 309(j) of the 1934 Act (47 U.S.C.

3 309(j)).’’.

4 Subtitle B—Oceans and Fisheries

5 SEC. 4021. LIMITS ON COAST GUARD USER FEES.

6 Section 10401(g) of the Omnibus Budget Reconcili7 ation Act of 1990 (46 U.S.C. 2110(a)(2)) is amended by

8 adding after ‘‘annually.’’ the following: ‘‘The Secretary may

9 not establish a fee or charge under paragraph (1) for inspec10 tion or examination of a small passenger vessel under this

11 title that is more than $300 annually for such vessels under

12 65 feet in length, or more than $600 annually for such ves13 sels 65 feet in length and greater. The Secretary may not

14 establish a fee or charge under paragraph (1) for inspection

15 or examination under this title for any publicly-owned

16 ferry.’’.

17 SEC. 4022. OIL SPILL RECOVERY INSTITUTE.

18 (a) FUNDING.—Section 5006 of the Oil Pollution Act

19 of 1990 (33 U.S.C. 2736) is amended by—

20 (1) striking subsection (a), redesignating sub21 section (b) as subsection ‘‘(a)’’;

22 (2) striking ‘‘5003’’ in the caption of subsection

23 (a), as redesignated, and inserting ‘‘5001, 5003,’’;

24 (3) inserting ‘‘to carry out section 5001 in the

25 amount as determined in section 5006(b), and’’ after
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1 ‘‘limitation,’’ in the text of subsection (a), as redesig2 nated; and

3 (4) adding at the end thereof the following:

4 ‘‘(b) USE OF INTEREST ONLY.—The amount of fund5 ing to be made available annually to carry out section 5001

6 shall be the interest produced by the Fund’s investment of

7 the $22,500,000 remaining funding authorized for the

8 Prince William Sound Oil Spill Recovery Institute and

9 currently deposited in the Fund and invested by the Sec10 retary of the Treasury in income producing securities along

11 with other funds comprising the Fund.

12 ‘‘(c) USE FOR SECTION 1012.—Beginning with the

13 eleventh year following the date of enactment of the Coast

14 Guard Authorization Act of 1995, the funding authorized

15 for the Prince William Sound Oil Spill Recovery Institute

16 and deposited in the Fund shall thereafter be made avail17 able for purposes of section 1012 in Alaska.’’.

18 (b) CONFORMING AMENDMENTS.—

19 (1) Section 6002(b) of the Oil Pollution Act of

20 1990 (33 U.S.C. 2752(b)) is amended by striking

21 ‘‘5006(b)’’ and inserting ‘‘5006’’.

22 (2) Section 7001(c)(9) the Oil Pollution Act of

23 1990 (33 U.S.C. 2761(c)(9)) is amended by striking

24 the period at the end thereof and inserting ‘‘until the
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1 authorization for funding under section 5006(b) ex2 pires’’.

3 Subtitle C—Rail Infrastructure

4 SEC. 4031. RAILROAD REHABILITATION AND IMPROVEMENT

5 PROGRAM.

6 (a) ISSUANCE OF OBLIGATIONS.—The Secretary of

7 Transportation shall issue to the Secretary of the Treasury

8 notes or other obligations pursuant to section 512 of the

9 Railroad Revitalization and Regulatory Reform Act of

10 1976 (45 U.S.C. 832) in such amounts and at such times

11 as may be necessary to pay any amounts required pursuant

12 to the guarantee of the principal amount of obligations

13 under sections 511 through 513 of that Act (45 U.S.C. 831

14 through 833) as long as any such guaranteed obligation is

15 outstanding.

16 (b) LIMITATION.—Notwithstanding any other provi17 sion of law, the Secretary of Transportation may not make

18 loan guarantee commitments under section 511 of that Act

19 (45 U.S.C. 831) in excess of $100,000,000 during each fiscal

20 year from 1996 through 2002, and $10,000,000 is hereby

21 made available for loan guarantee commitments made dur22 ing each of those fiscal years.

23 SEC. 4032. LOCAL RAIL FREIGHT ASSISTANCE.

24 Section 22108(a) of title 49, United States Code, is

25 amended—
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1 (1) by adding at the end of paragraph (1) the

2 following:

3 ‘‘(C) $25,000,000 for each of the fiscal years

4 ending September 30, 1995, 1996, and 1997,

5 which is authorized and hereby made available.’’;

6 and

7 (2) by striking ‘‘1994,’’ in paragraph (3) and in8 serting ‘‘1997,’’.

9 SEC. 4033. DISASTER FUNDING FOR RAILROADS.

10 Section 22101 of title 49, United States Code, is

11 amended by redesignating subsection (d) as (e), and by in12 serting after subsection (c) the following:

13 ‘‘(d) DISASTER FUNDING FOR RAILROADS.—

14 ‘‘(1) The Secretary may declare that a disaster

15 has occurred and that it is necessary to repair and

16 rebuild rail lines damaged as a result of such disas17 ter. If the Secretary makes a declaration under this

18 paragraph, the Secretary may—

19 ‘‘(A) waive the requirements of this section;

20 ‘‘(B) consider the extent to which the State

21 has available unexpended local rail freight as22 sistance funds or available repaid loans; and

23 ‘‘(C) prescribe the form and time for appli24 cations for assistance made available herein.
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1 ‘‘(2) The Secretary may not provide assistance

2 under this subsection unless emergency disaster relief

3 funds are appropriated for that purpose.

4 ‘‘(3) Funds provided under this subsection shall

5 remain available until expended.’’.

6 SEC. 4034. GRADE-CROSSING ELIGIBILITY.

7 Section 22101(a) of title 49, United States Code, is

8 amended—

9 (1) by striking ‘‘and’’ after the semicolon in

10 paragraph (2);

11 (2) by striking the period at the end of para12 graph (3) and inserting a semicolon; and

13 (3) by adding at the end thereof the following

14 new paragraphs:

15 ‘‘(4) closing or improving a railroad grade cross16 ing or series of railroad grade crossings; and

17 ‘‘(5) creating a State supervised grain car

18 pool.’’.
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1 TITLE V—COMMITTEE ON EN2 ERGY AND NATURAL RE3 SOURCES

4 Subtitle A—United States

5 Enrichment Corporation

6 SEC. 5001. SHORT TITLE.

7 This subtitle may be cited as the ‘‘USEC Privatization

8 Act’’.

9 SEC. 5002. PURPOSE.

10 The purpose of this subtitle is to transfer the interest

11 of the United States in the United States Enrichment Cor12 poration to the private sector in a manner that provides

13 for the long-term viability of the Corporation, provides for

14 the continuation by the Corporation of the operation of the

15 Department of Energy’s gaseous diffusion plants, provides

16 for the protection of the public interest in maintaining a

17 reliable and economical domestic source of uranium mining

18 and enrichment services, and, to the extent not inconsistent

19 with such purposes, secures the maximum proceeds to the

20 United States.

21 SEC. 5003. DEFINITIONS.

22 For purposes of this subtitle:

23 (1) The term ‘‘AVLIS’’ means atomic vapor laser

24 isotope separation technology.
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1 (2) The term ‘‘Corporation’’ means the United

2 States Enrichment Corporation and, unless the con3 text otherwise requires, includes the private corpora4 tion and any successor thereto following privatiza5 tion.

6 (3) The term ‘‘gaseous diffusion plants’’ means

7 the Paducah Gaseous Diffusion Plant at Paducah,

8 Kentucky and the Portsmouth Gaseous Diffusion

9 Plant at Piketon, Ohio.

10 (4) The term ‘‘highly enriched uranium’’ means

11 uranium enriched to 20 percent or more of the ura12 nium-235 isotope.

13 (5) The term ‘‘low-enriched uranium’’ means

14 uranium enriched to less than 20 percent of the ura15 nium-235 isotope, including that which is derived

16 from highly enriched uranium.

17 (6) The term ‘‘low-level radioactive waste’’ has

18 the meaning given such term in section 2(9) of the

19 Low-Level Radioactive Waste Policy Act (42 U.S.C.

20 2021b(9)).

21 (7) The term ‘‘private corporation’’ means the

22 corporation established under section 5005.

23 (8) The term ‘‘privatization’’ means the transfer

24 of ownership of the Corporation to private investors.
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1 (9) The term ‘‘privatization date’’ means the

2 date on which 100 percent of the ownership of the

3 Corporation has been transferred to private investors.

4 (10) The term ‘‘public offering’’ means an under5 written offering to the public of the common stock of

6 the private corporation pursuant to section 5004.

7 (11) The ‘‘Russian HEU Agreement’’ means the

8 Agreement Between the Government of the United

9 States of America and the Government of the Russian

10 Federation Concerning the Disposition of Highly En11 riched Uranium Extracted from Nuclear Weapons,

12 dated February 18, 1993.

13 (12) The term ‘‘Secretary’’ means the Secretary

14 of Energy.

15 (13) The ‘‘Suspension Agreement’’ means the

16 Agreement to Suspend the Antidumping Investigation

17 on Uranium from the Russian Federation, as amend18 ed.

19 (14) The term ‘‘uranium enrichment’’ means the

20 separation of uranium of a given isotopic content

21 into 2 components, 1 having a higher percentage of a

22 fissile isotope and 1 having a lower percentage.

23 SEC. 5004. SALE OF THE CORPORATION.

24 (a) AUTHORIZATION.—The Board of Directors of the

25 Corporation, with the approval of the Secretary of the
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1 Treasury, shall transfer ownership of the assets and obliga2 tions of the Corporation to the private corporation estab3 lished under section 5005 (which may be consummated

4 through a merger or consolidation effected in accordance

5 with, and having the effects provided under, the laws of the

6 state of incorporation of the private corporation, as if the

7 Corporation were incorporated thereunder).

8 (b) BOARD DETERMINATION.—The Board, with the

9 approval of the Secretary of the Treasury, shall select the

10 method of transfer and establish terms and conditions for

11 the transfer that will provide the maximum proceeds to the

12 Treasury of the United States and will provide for the long13 term viability of the private corporation, the continued op14 eration of the gaseous diffusion plants, and the public inter15 est in maintaining a reliable and economical domestic ura16 nium mining and enrichment industries.

17 (c) APPLICATION OF SECURITIES LAWS.—Any offering

18 or sale of securities by the private corporation shall be sub19 ject to the Securities Act of 1933 (15 U.S.C. 77a et seq.),

20 the Securities Exchange Act of 1934 (15 U.S.C. 78a et seq.),

21 and the provisions of the Constitution and laws of any

22 State, territory, or possession of the United States relating

23 to transactions in securities.

24 (d) PROCEEDS.—Proceeds from the sale of the United

25 States’ interest in the Corporation shall be—
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1 (1) deposited in the general fund of the Treasury;

2 (2) included in the budget baseline required by

3 the Balanced Budget and Emergency Deficit Control

4 Act of 1985; and

5 (3) counted as an offset to direct spending for

6 purposes of section 252 of such Act, notwithstanding

7 section 257(e) of such Act.

8 (e) EXPENSES.—Expenses of privatization shall be

9 paid from Corporation revenue accounts in the United

10 States Treasury.

11 SEC. 5005. ESTABLISHMENT OF PRIVATE CORPORATION.

12 (a) INCORPORATION.—(1) The directors of the Cor13 poration shall establish a private for-profit corporation

14 under the laws of a State for the purpose of receiving the

15 assets and obligations of the Corporation at privatization

16 and continuing the business operations of the Corporation

17 following privatization.

18 (2) The directors of the Corporation may serve as

19 incorporators of the private corporation and shall take all

20 steps necessary to establish the private corporation, includ21 ing the filing of articles of incorporation consistent with

22 the provisions of this subtitle.

23 (3) Employees and officers of the Corporation (includ24 ing members of the Board of Directors) acting in accordance

25 with this section on behalf of the private corporation shall
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1 be deemed to be acting in their official capacities as employ2 ees or officers of the Corporation for purposes of 18 U.S.C.

3 205.

4 (b) STATUS OF THE PRIVATE CORPORATION.—(1) The

5 private corporation shall not be an agency, instrumentality,

6 or establishment of the United States, a Government cor7 poration, or a Government-controlled corporation.

8 (2) Except as otherwise provided by this Subtitle, fi9 nancial obligations of the private corporation shall not be

10 obligations of, or guaranteed as to principal or interest by,

11 the Corporation or the United States, and the obligations

12 shall so plainly state.

13 (3) No action under section 1491 of title 28, United

14 States Code, shall be allowable against the United States

15 based on actions of the private corporation.

16 (c) APPLICATION OF POST-GOVERNMENT EMPLOYMENT

17 RESTRICTIONS.—Beginning on the privatization date, the

18 restrictions of 18 U.S.C. 207(a), (b), (c), and (d) shall not

19 apply to the acts of an individual done in carrying out

20 official duties as a director, officer, or employee of the pri21 vate corporation, if the individual was an officer or em22 ployee of the Corporation (including a director) continu23 ously during the 45 days prior to the privatization date.

24 (d) DISSOLUTION.—In the event that the privatization

25 does not occur, the Corporation will provide for the dissolu-
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1 tion of the private corporation within 1 year of the private

2 corporation’s incorporation unless the Secretary of the

3 Treasury or his delegate, upon the Corporation’s request,

4 agrees to delay any such dissolution for an additional year.

5 SEC. 5006. TRANSFERS TO THE PRIVATE CORPORATION.

6 Concurrent with privatization, the Corporation shall

7 transfer to the private corporation—

8 (1) the lease of the gaseous diffusion plants in

9 accordance with section 5007,

10 (2) all personal property and inventories of the

11 Corporation,

12 (3) all contracts, agreements, and leases under

13 section 5008(a),

14 (4) the Corporation’s right to purchase power

15 from the Secretary under section 5008(b),

16 (5) such funds in accounts of the Corporation

17 held by the Treasury or on deposit with any bank or

18 other financial institution as approved by the Sec19 retary of the Treasury, and

20 (6) all of the Corporation’s records, including all

21 of the papers and other documentary materials, re22 gardless of physical form or characteristics, made or

23 received by the Corporation.
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1 SEC. 5007. LEASING OF GASEOUS DIFFUSION FACILITIES.

2 (a) TRANSFER OF LEASE.—Concurrent with privat3 ization, the Corporation shall transfer to the private cor4 poration the lease of the gaseous diffusion plants and relat5 ed property for the remainder of the term of such lease in

6 accordance with the terms of such lease.

7 (b) RENEWAL.—The private corporation shall have the

8 exclusive option to lease the gaseous diffusion plants and

9 related property for additional periods following the expira10 tion of the initial term of the lease.

11 (c) EXCLUSION OF FACILITIES FOR PRODUCTION OF

12 HIGHLY ENRICHED URANIUM.—The Secretary shall not

13 lease to the private corporation any facilities necessary for

14 the production of highly enriched uranium but may, subject

15 to the requirements of the Atomic Energy Act of 1954 (42

16 U.S.C. 2011 et seq.), grant the Corporation access to such

17 facilities for purposes other than the production of highly

18 enriched uranium.

19 (d) DOE RESPONSIBILITY FOR PREEXISTING CONDI20 TIONS.—The payment of any costs of decontamination and

21 decommissioning, response actions, or corrective actions

22 with respect to conditions existing before July 1, 1993, at

23 the gaseous diffusion plants shall remain the sole respon24 sibility of the Secretary.

25 (e) ENVIRONMENTAL AUDIT.—For purposes of sub26 section (d), the conditions existing before July 1, 1993, at
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1 the gaseous diffusion plants shall be determined from the

2 environmental audit conducted pursuant to section 1403(e)

3 of the Atomic Energy Act of 1954 (42 U.S.C. 2297c–2(e)).

4 (f) TREATMENT UNDER PRICE-ANDERSON PROVI5 SIONS.—Any lease executed between the Secretary and the

6 Corporation or the private corporation, and any extension

7 or renewal thereof, under this section shall be deemed to

8 be a contract for purposes of section 170d. of the Atomic

9 Energy Act of 1954 (42 U.S.C. 2210(d)).

10 (g) WAIVER OF EIS REQUIREMENT.—The execution or

11 transfer of the lease between the Secretary and the Corpora12 tion or the private corporation, and any extension or re13 newal thereof, shall not be considered a major Federal ac14 tion significantly affecting the quality of the human envi15 ronment for purposes of section 102 of the National Envi16 ronmental Policy Act of 1969 (42 U.S.C. 4332).

17 SEC. 5008. TRANSFER OF CONTRACTS.

18 (a) TRANSFER OF CONTRACTS.—Concurrent with pri19 vatization, the Corporation shall transfer to the private cor20 poration all contracts, agreements, and leases, including all

21 uranium enrichment contracts, that were—

22 (1) transferred by the Secretary to the Corpora23 tion pursuant to section 1401(b) of the Atomic En24 ergy Act of 1954 (42 U.S.C. 2297c(b)), or
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1 (2) entered into by the Corporation before the

2 privatization date.

3 (b) NONTRANSFERABLE POWER CONTRACTS.—The

4 Corporation shall transfer to the private corporation the

5 right to purchase power from the Secretary under the power

6 purchase contracts for the gaseous diffusion plants executed

7 by the Secretary before July 1, 1993. The Secretary shall

8 continue to receive power for the gaseous diffusion plants

9 under such contracts and shall continue to resell such power

10 to the private corporation at cost during the term of such

11 contracts.

12 (c) EFFECT OF TRANSFER.—(1) Notwithstanding sub13 section (a), the United States shall remain obligated to the

14 parties to the contracts, agreements, and leases transferred

15 under subsection (a) for the performance of its obligations

16 under such contracts, agreements, or leases during their

17 terms. Performance of such obligations by the private cor18 poration shall be considered performance by the United

19 States.

20 (2) If a contract, agreement, or lease transferred under

21 subsection (a) is terminated, extended, or materially

22 amended after the privatization date—

23 (A) the private corporation shall be responsible

24 for any obligation arising under such contract, agree-
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1 ment, or lease after any extension or material amend2 ment, and

3 (B) the United States shall be responsible for

4 any obligation arising under the contract, agreement,

5 or lease before the termination, extension, or material

6 amendment.

7 (3) The private corporation shall reimburse the United

8 States for any amount paid by the United States under

9 a settlement agreement entered into with the consent of the

10 private corporation or under a judgment, if the settlement

11 or judgment—

12 (A) arises out of an obligation under a contract,

13 agreement, or lease transferred under subsection (a),

14 and

15 (B) arises out of actions of the private corpora16 tion between the privatization date and the date of a

17 termination, extension, or material amendment of

18 such contract, agreement, or lease.

19 (d) PRICING.—The Corporation may establish prices

20 for its products, materials, and services provided to cus21 tomers on a basis that will allow it to attain the normal

22 business objectives of a profit making corporation.

23 SEC. 5009. LIABILITIES.

24 (a) LIABILITY OF THE UNITED STATES.—(1) Except

25 as otherwise provided in this Subtitle, all liabilities arising
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1 out of the operation of the uranium enrichment enterprise

2 before July 1, 1993, shall remain the direct liabilities of

3 the Secretary.

4 (2) Except as provided in subsection (a)(3) or other5 wise provided in a memorandum of agreement entered into

6 by the Corporation and the Office of Management and

7 Budget prior to the privatization date, all liabilities arising

8 out of the operation of the Corporation between July 1,

9 1993, and the privatization date shall remain the direct

10 liabilities of the United States.

11 (3) All liabilities arising out of the disposal of depleted

12 uranium generated by the Corporation between July 1,

13 1993, and the privatization date shall become the direct li14 abilities of the Secretary.

15 (4) Any stated or implied consent for the United

16 States, or any agent or officer of the United States, to be

17 sued by any person for any legal, equitable, or other relief

18 with respect to any claim arising out of, or resulting from,

19 the privatization of the Corporation is hereby withdrawn.

20 (5) To the extent that any claim against the United

21 States under this section is of the type otherwise required

22 by Federal statute or regulation to be presented to a Federal

23 agency or official for adjudication or review, such claim

24 shall be presented to the Department of Energy in accord25 ance with procedures to be established by the Secretary.
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1 Nothing in this paragraph shall be construed to impose on

2 the Department of Energy liability to pay any claim pre3 sented pursuant to this paragraph.

4 (6) The Attorney General shall represent the United

5 States in any action seeking to impose liability under this

6 subsection.

7 (b) LIABILITY OF THE CORPORATION.—Notwithstand8 ing any provision of any agreement to which the Corpora9 tion is a party, the Corporation shall not be considered in

10 breach, default, or violation of any agreement because of

11 the transfer of such agreement to the private corporation

12 under section 5008 or any other action the Corporation is

13 required to take under this subtitle.

14 (c) LIABILITY OF THE PRIVATE CORPORATION.—Ex15 cept as provided in this subtitle, the private corporation

16 shall be liable for any liabilities arising out of its oper17 ations after the privatization date.

18 (d) LIABILITY OF OFFICERS AND DIRECTORS.—(1) No

19 officer, director, employee, or agent of the Corporation shall

20 be liable in any civil proceeding to any party in connection

21 with any action taken in connection with the privatization

22 if, with respect to the subject matter of the action, suit, or

23 proceeding, such person was acting within the scope of his

24 employment.
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1 (2) This subsection shall not apply to claims arising

2 under the Securities Act of 1933 (15 U.S.C. 77a. et seq.),

3 the Securities Exchange Act of 1934 (15 U.S.C. 78a. et seq.),

4 or under the Constitution or laws of any State, territory,

5 or possession of the United States relating to transactions

6 in securities.

7 SEC. 5010. EMPLOYEE PROTECTIONS.

8 (a) CONTRACTOR EMPLOYEES.—(1) Privatization

9 shall not diminish the accrued, vested pension benefits of

10 employees of the Corporation’s operating contractor at the

11 two gaseous diffusion plants.

12 (2) In the event that the private corporation termi13 nates or changes the contractor at either or both of the gase14 ous diffusion plants, the plan sponsor or other appropriate

15 fiduciary of the pension plan covering employees of the

16 prior operating contractor shall arrange for the transfer of

17 all plan assets and liabilities relating to accrued pension

18 benefits of such plans participants and beneficiaries from

19 such plant to a pension plan sponsored by the new contrac20 tor or the private corporation or a joint labor-management

21 plan, as the case may be.

22 (3) In addition to any obligations arising under the

23 National Labor Relations Act, any employer (including the

24 private corporation if it operates a gaseous diffusion plant
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1 without a contractor or any contractor of the private cor2 poration) at a gaseous diffusion plant shall—

3 (A) abide by the terms of any unexpired collec4 tive bargaining agreement covering employees in bar5 gaining units at the plant and in effect on the privat6 ization date until the stated expiration or termi7 nation date of the agreement; or

8 (B) in the event a collective bargaining agree9 ment is not in effect upon the privatization date, have

10 the same bargaining obligations under section 8(d) of

11 the National Labor Relations Act (29 U.S.C. 158(d))

12 as it had immediately before the privatization date.

13 (4) If the private corporation replaces its operating

14 contractor at a gaseous diffusion plant, the new employer

15 (including the new contractor or the private corporation if

16 it operates a gaseous diffusion plant without a contractor)

17 shall—

18 (A) offer employment to non-management em19 ployees of the predecessor contractor to the extent that

20 their jobs still exist or they are qualified for new jobs,

21 and

22 (B) abide by the terms of the predecessor contrac23 tor’s collective bargaining agreement until the agree24 ment expires or a new agreement is signed.
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1 (5) In the event of a plant closing or mass layoff (as

2 such terms are defined in section 2101(a) (2) and (3) of

3 title 29, United States Code) at either of the gaseous diffu4 sion plants, the Secretary of Energy shall treat any ad5 versely affected employee of an operating contractor at ei6 ther plant who was an employee at such plant on July 1,

7 1993, as a Department of Energy employee for purposes

8 of sections 3161 and 3162 of the National Defense Author9 ization Act for Fiscal Year 1993 (42 U.S.C. 7274h–7274i).

10 (6)(A) The Secretary and the private corporation shall

11 cause the post-retirement health benefits plan provider (or

12 its successor) to continue to provide benefits for persons em13 ployed by an operating contractor at either of the gaseous

14 diffusion plants in an economically efficient manner and

15 at substantially the same level of coverage as eligible retirees

16 are entitled to receive on the privatization date.

17 (B) Persons eligible for coverage under subparagraph

18 (A) shall be limited to:

19 (i) Persons who retired from active employment

20 at one of the gaseous diffusion plants on or before the

21 privatization date as vested participants in a pension

22 plan maintained either by the Corporation’s operat23 ing contractor or by a contractor employed prior to

24 July 1, 1993, by the Department of Energy to operate

25 a gaseous diffusion plant.
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1 (ii) Persons who are employed by the Corpora2 tion’s operating contractor on or before the privatiza3 tion date and are vested participants in a pension

4 plan maintained either by the Corporation’s operat5 ing contractor or by a contractor employed prior to

6 July 1, 1993, by the Department of Energy to operate

7 a gaseous diffusion plant.

8 (C) The Secretary shall fund the entire cost of post9 retirement health benefits for persons who retired from em10 ployment with an operating contractor prior to July 1,

11 1993.

12 (D) The Secretary and the Corporation shall fund the

13 cost of post-retirement health benefits for persons who retire

14 from employment with an operating contractor after July

15 1, 1993, in proportion to the retired person’s years and

16 months of service at a gaseous diffusion plant under their

17 respective management.

18 (7)(A) Any suit under this subsection alleging a viola19 tion of an agreement between an employer and a labor orga20 nization shall be brought in accordance with section 301

21 of the Labor Management Relations Act (29 U.S.C. 185).

22 (B) Any charge under this subsection alleging an un23 fair labor practice violative of section 8 of the National

24 Labor Relations Act (29 U.S.C. 158) shall be pursued in
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1 accordance with section 10 of the National Labor Relations

2 Act (29 U.S.C. 160).

3 (C) Any suit alleging a violation of any provision of

4 this subsection, to the extent it does not allege a violation

5 of the National Labor Relations Act, may be brought in

6 any district court of the United States having jurisdiction

7 of the parties, without regard to the amount in controversy

8 or the citizenship of the parties.

9 (b) FORMER FEDERAL EMPLOYEES.—(1)(A) Employ10 ees of the Corporation who were subject to either the Civil

11 Service Retirement System (CSRS) or the Federal Employ12 ees’ Retirement System (FERS) on the day immediately

13 preceding the privatization date shall elect—

14 (i) to retain their coverage under either CSRS or

15 FERS, as applicable, in lieu of coverage by the Cor16 poration’s retirement system, or

17 (ii) to receive a deferred annuity or lump-sum

18 benefit payable to a terminated employee under

19 CSRS or FERS, as applicable.

20 (B) Those employees electing subparagraph (A)(ii)

21 shall have the option to transfer the balance in their Thrift

22 Savings Plan account to a defined contribution plan under

23 the Corporation’s retirement system, consistent with appli24 cable law and the terms of the Corporation’s defined con25 tribution plan.
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1 (2) The Corporation shall pay to the Civil Service Re2 tirement and Disability Fund—

3 (A) such employee deductions and agency con4 tributions as are required by sections 8334, 8422, and

5 8423 of title 5, United States Code, for those employ6 ees who elect to retain their coverage under either

7 CSRS or FERS pursuant to paragraph (1);

8 (B) such additional agency contributions as are

9 determined necessary by the Office of Personnel Man10 agement to pay, in combination with the sums under

11 subparagraph (A), the ‘‘normal cost’’ (determined

12 using dynamic assumptions) of retirement benefits for

13 those employees who elect to retain their coverage

14 under CSRS pursuant to paragraph (1), with the

15 concept of ‘‘normal cost’’ being used consistent with

16 generally accepted actuarial standards and prin17 ciples; and

18 (C) such additional amounts, not to exceed two

19 percent of the amounts under subparagraphs (A) and

20 (B), as are determined necessary by the Office of Per21 sonnel Management to pay the cost of administering

22 retirement benefits for employees who retire from the

23 Corporation after the privatization date under either

24 CSRS or FERS, for their survivors, and for survivors

25 of employees of the Corporation who die after the pri-
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1 vatization date (which amounts shall be available to

2 the Office of Personnel Management as provided in

3 section 8348(a)(1)(B) of title 5, United States Code).

4 (3) The Corporation shall pay to the Thrift Savings

5 Fund such employee and agency contributions as are re6 quired by section 8432 of title 5, United States Code, for

7 those employees who elect to retain their coverage under

8 FERS pursuant to paragraph (1).

9 (4) Any employee of the Corporation who was subject

10 to the Federal Employee Health Benefits Program

11 (FEHBP) on the day immediately preceding the privatiza12 tion date and who elects to retain coverage under either

13 CSRS or FERS pursuant to paragraph (1) shall have the

14 option to receive health benefits from a health benefit plan

15 established by the Corporation or to continue without inter16 ruption coverage under the FEHBP, in lieu of coverage by

17 the Corporation’s health benefit system.

18 (5) The Corporation shall pay to the Employees Health

19 Benefits Fund—

20 (A) such employee deductions and agency con21 tributions as are required by section 8906(a)–(f) of

22 title 5, United States Code, for those employees who

23 elect to retain their coverage under FEHBP pursuant

24 to paragraph (4); and
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1 (B) such amounts as are determined necessary

2 by the Office of Personnel Management under para3 graph (6) to reimburse the Office of Personnel Man4 agement for contributions under section 8906(g)(1) of

5 title 5, United States Code, for those employees who

6 elect to retain their coverage under FEHBP pursuant

7 to paragraph (4).

8 (6) The amounts required under paragraph (5)(B)

9 shall pay the Government contributions for retired employ10 ees who retire from the Corporation after the privatization

11 date under either CSRS or FERS, for survivors of such re12 tired employees, and for survivors of employees of the Cor13 poration who die after the privatization date, with said

14 amounts prorated to reflect only that portion of the total

15 service of such employees and retired persons that was per16 formed for the Corporation after the privatization date.

17 SEC. 5011. OWNERSHIP LIMITATIONS.

18 No director, officer, or employee of the Corporation

19 may acquire any securities, or any rights to acquire any

20 securities of the private corporation on terms more favor21 able than those offered to the general public—

22 (1) in a public offering designed to transfer own23 ership of the Corporation to private investors,
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1 (2) pursuant to any agreement, arrangement, or

2 understanding entered into before the privatization

3 date, or

4 (3) before the election of the directors of the pri5 vate corporation.

6 SEC. 5012. URANIUM TRANSFERS AND SALES.

7 (a) TRANSFERS AND SALES BY THE SECRETARY.—The

8 Secretary shall not provide enrichment services or transfer

9 or sell any uranium (including natural uranium con10 centrates, natural uranium hexafluoride, or enriched ura11 nium in any form) to any person except as consistent with

12 this section.

13 (b) RUSSIAN HEU.—(1) On or before December 31,

14 1996, the United States Executive Agent under the Russian

15 HEU Agreement shall transfer to the Secretary without

16 charge title to an amount of uranium hexafluoride equiva17 lent to the natural uranium component of low-enriched ura18 nium derived from at least 18 metric tons of highly enriched

19 uranium purchased from the Russian Executive Agent

20 under the Russian HEU Agreement. The quantity of such

21 uranium hexafluoride delivered to the Secretary shall be

22 based on a tails assay of 0.30 U235. Uranium hexafluoride

23 transferred to the Secretary pursuant to this paragraph

24 shall be deemed under U.S. law for all purposes to be of

25 Russian origin.
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1 (2) Within 7 years of the date of enactment of this

2 subtitle, the Secretary shall sell, and receive payment for,

3 the uranium hexafluoride transferred to the Secretary pur4 suant to paragraph (1). Such uranium hexafluoride shall

5 be sold—

6 (A) at any time for use in the United States for

7 the purpose of overfeeding;

8 (B) at any time for end use outside the United

9 States; or

10 (C) in calendar year 2001 for consumption by

11 end users in the United States not prior to January

12 1, 2002, in volumes not to exceed 3 million pounds

13 U3O8 equivalent per year.

14 (3) With respect to all enriched uranium delivered to

15 the United States Executive Agent under the Russian HEU

16 Agreement on or after January 1, 1997, the United States

17 Executive Agent shall, upon request of the Russian Execu18 tive Agent, enter into an agreement to deliver concurrently

19 to the Russian Executive Agent an amount of uranium

20 hexafluoride equivalent to the natural uranium component

21 of such uranium. An agreement executed pursuant to a re22 quest of the Russian Executive Agent, as contemplated in

23 this paragraph, may pertain to any deliveries due during

24 any period remaining under the Russian HEU Agreement.

25 The quantity of such uranium hexafluoride delivered to the
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1 Russian Executive Agent shall be based on a tails assay

2 of 0.30 U235. Title to uranium hexafluoride delivered to

3 the Russian Executive Agent pursuant to this paragraph

4 shall transfer to the Russian Executive Agent upon delivery

5 of such material to the Russian Executive Agent, with such

6 delivery to take place at a North American facility des7 ignated by the Russian Executive Agent. Uranium

8 hexafluoride delivered to the Russian Executive Agent pur9 suant to this paragraph shall be deemed under U.S. law

10 for all purposes to be of Russian origin. Such uranium

11 hexafluoride may be sold to any person or entity for deliv12 ery and use in the United States only as permitted in sub13 sections (b)(5), (b)(6), and (b)(7) of this section.

14 (4) In the event that the Russian Executive Agent does

15 not exercise its right to enter into an agreement to take de16 livery of the natural uranium component of any low-en17 riched uranium, as contemplated in paragraph (3), within

18 90 days of the date such low-enriched uranium is delivered

19 to the United States Executive Agent, then the United

20 States Executive Agent shall engage an independent entity

21 through a competitive selection process to auction an

22 amount of uranium hexafluoride or U3O8 (in the event that

23 the conversion component of such hexafluoride has pre24 viously been sold) equivalent to the natural uranium com25 ponent of such low-enriched uranium. Such independent en-
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1 tity shall sell such uranium hexafluoride in one or more

2 lots to any person or entity to maximize the proceeds from

3 such sales, for disposition consistent with the limitations

4 set forth in this subsection. The independent entity shall

5 pay to the Russian Executive Agent the proceeds of any

6 such auction less all reasonable transaction and other ad7 ministrative costs. The quantity of such uranium

8 hexafluoride auctioned shall be based on a tails assay of

9 0.30 U235. Title to uranium hexafluoride auctioned pursu10 ant to this paragraph shall transfer to the buyer of such

11 material upon delivery of such material to the buyer. Ura12 nium hexafluoride auctioned pursuant to this paragraph

13 shall be deemed under U.S. law for all purposes to be of

14 Russian origin.

15 (5) Except as provided in paragraphs (6) and (7), ura16 nium hexafluoride delivered to the Russian Executive Agent

17 under paragraph (3) or auctioned pursuant to paragraph

18 (4), may not be delivered for consumption by end users in

19 the United States either directly or indirectly prior to Jan20 uary 1, 1998, and thereafter only in accordance with the

21 following schedule:

Annual maximum

deliveries to end users

Year: (millions lbs. U3O8

equivalent)

1998 ................................................................................................ 2

1999 ................................................................................................ 4

2000 ................................................................................................ 6

2001 ................................................................................................ 8

2002 ................................................................................................ 10
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Annual maximum

deliveries to end users

Year: (millions lbs. U3O8

equivalent)

2003 ................................................................................................ 12

2004 ................................................................................................ 14

2005 ................................................................................................ 16

2006 ................................................................................................ 17

2007 ................................................................................................ 18

2008 ................................................................................................ 19

2009 and each year thereafter ...................................................... 20.

1 (6) Uranium hexafluoride delivered to the Russian Ex2 ecutive Agent under paragraph (3) or auctioned pursuant

3 to paragraph (4) may be sold at any time as Russian-ori4 gin natural uranium in a matched sale pursuant to the

5 Suspension Agreement, and in such case shall not be count6 ed against the annual maximum deliveries set forth in

7 paragraph (5).

8 (7) Uranium hexafluoride delivered to the Russian Ex9 ecutive Agent under paragraph (3) or auctioned pursuant

10 to paragraph (4) may be sold at any time for use in the

11 United States for the purpose of overfeeding in the oper12 ations of enrichment facilities.

13 (8) Nothing in this subsection (b) shall restrict the sale

14 of the conversion component of such uranium hexafluroide.

15 Material sold pursuant to paragraph 5 shall not be

16 swapped, exchanged or loaned.

17 (9) The Secretary of Commerce shall have responsibil18 ity for the administration and enforcement of the limita19 tions set forth in this subsection. The Secretary of Com20 merce may require any person to provide any certifications,
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1 information, or take any action that may be necessary to

2 enforce these limitations. The U.S. Customs Service shall

3 maintain and provide any information required by the Sec4 retary of Commerce and shall take any action requested by

5 the Secretary of Commerce which is necessary for the ad6 ministration and enforcement of the uranium delivery limi7 tations set forth in this section.

8 (10) The President shall monitor the actions of the

9 United States Executive Agent under the Russian HEU

10 Agreement and shall report to the Congress not later than

11 December 31 of each year on the effect the low-enriched ura12 nium delivered under the Russian HEU Agreement is hav13 ing on the domestic uranium mining, conversion, and en14 richment industries, and the operation of the gaseous diffu15 sion plants. Such report shall include a description of ac16 tions taken or proposed to be taken by the President to pre17 vent or mitigate any material adverse impact on such in18 dustries or any loss of employment at the gaseous diffusion

19 plants as a result of the Russian HEU Agreement.

20 (c) TRANSFERS TO THE CORPORATION.—(1) The Sec21 retary shall transfer to the Corporation without charge up

22 to 50 metric tons of enriched uranium and up to 7,000 met23 ric tons of natural uranium from the Department of Ener24 gy’s stockpile, subject to the restrictions in subsection (c)(2).
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1 (2) The Corporation shall not deliver for commercial

2 end use in the United States—

3 (A) any of the uranium transferred under this

4 subsection before January 1, 1998;

5 (B) more than 10 percent of the uranium (by

6 uranium hexafluoride equivalent content) transferred

7 under this subsection or more than 4 million pounds,

8 whichever is less, in any calendar year after 1997; or

9 (C) more than 800,000 separative work units

10 contained in low-enriched uranium transferred under

11 this subsection in any calendar year.

12 (d) INVENTORY SALES.—(1) In addition to the trans13 fers authorized under subsections (c) and (e), the Secretary

14 may, from time to time, sell natural and low-enriched ura15 nium (including low-enriched uranium derived from highly

16 enriched uranium) from the Department of Energy’s stock17 pile.

18 (2) Except as provided in subsections (b), (c), and (e)

19 no sale or transfer of natural or low-enriched uranium shall

20 be made unless—

21 (A) the President determines that the material is

22 not necessary to national security needs,

23 (B) the Secretary determines that the sale of the

24 material will not have an adverse material impact on

25 the domestic uranium mining, conversion, or enrich-
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1 ment industry, taking into account the sales of ura2 nium under the Russian HEU Agreement and the

3 Suspension Agreement, and

4 (C) the price paid to the Secretary will not be

5 less than the fair market value of the material.

6 (e) GOVERNMENT TRANSFERS.—Notwithstanding sub7 section (d)(2), the Secretary may transfer or sell enriched

8 uranium—

9 (1) to a Federal agency if the material is trans10 ferred for the use of the receiving agency without any

11 resale or transfer to another entity and the material

12 does not meet commercial specifications;

13 (2) to any person for national security purposes,

14 as determined by the Secretary; or

15 (3) to any State or local agency or nonprofit,

16 charitable, or educational institution for use other

17 than the generation of electricity for commercial use.

18 (f) SAVINGS PROVISION.—Nothing in this subtitle shall

19 be read to modify the terms of the Russian HEU Agreement.

20 SEC. 5013. LOW-LEVEL WASTE.

21 (a) RESPONSIBILITY OF DOE.—(1) The Secretary, at

22 the request of the generator, shall accept for disposal low23 level radioactive waste, including depleted uranium if it

24 were ultimately determined to be low-level radioactive

25 waste, generated by—
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1 (A) the Corporation as a result of the operations

2 of the gaseous diffusion plants or as a result of the

3 treatment of such wastes at a location other than the

4 gaseous diffusion plants, or

5 (B) any person licensed by the Nuclear Regu6 latory Commission to operate a uranium enrichment

7 facility under sections 53, 63, and 193 of the Atomic

8 Energy Act of 1954 (42 U.S.C. 2073, 2093, and

9 2243).

10 (2) Except as provided in paragraph (3), the generator

11 shall reimburse the Secretary for the disposal of low-level

12 radioactive waste pursuant to paragraph (1) in an amount

13 equal to the Secretary’s costs, including a pro rata share

14 of any capital costs, but in no event more than an amount

15 equal to that which would be charged by commercial, State,

16 regional, or interstate compact entities for disposal of such

17 waste.

18 (3) In the event depleted uranium were ultimately de19 termined to be low-level radioactive waste, the generator

20 shall reimburse the Secretary for the disposal of depleted

21 uranium pursuant to paragraph (1) in an amount equal

22 to the Secretary’s costs, including a pro rata share of any

23 capital costs.

24 (b) AGREEMENTS WITH OTHER PERSONS.—The gen25 erator may also enter into agreements for the disposal of
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1 low-level radioactive waste subject to subsection (a) with

2 any person other than the Secretary that is authorized by

3 applicable laws and regulations to dispose of such wastes.

4 (c) STATE OR INTERSTATE COMPACTS.—Notwith5 standing any other provision of law, no State or interstate

6 compact shall be liable for the treatment, storage, or dis7 posal of any low-level radioactive waste (including mixed

8 waste) attributable to the operation, decontamination, and

9 decommissioning of any uranium enrichment facility.

10 SEC. 5014. AVLIS.

11 (a) EXCLUSIVE RIGHT TO COMMERCIALIZE.—The

12 Corporation shall have the exclusive commercial right to de13 ploy and use any AVLIS patents, processes, and technical

14 information owned or controlled by the Government, upon

15 completion of a royalty agreement with the Secretary.

16 (b) TRANSFER OF RELATED PROPERTY TO CORPORA17 TION.—

18 (1) IN GENERAL.—To the extent requested by the

19 Corporation and subject to the requirements of the

20 Atomic Energy Act of 1954, the President shall trans21 fer without charge to the Corporation all of the right,

22 title, or interest in and to property owned by the

23 United States under control or custody of the Sec24 retary that is directly related to and materially useful

25 in the performance of the Corporation’s purposes re-
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1 garding AVLIS and alternative technologies for ura2 nium enrichment, including—

3 (A) facilities, equipment, and materials for

4 research, development, and demonstration activi5 ties; and

6 (B) all other facilities, equipment, mate7 rials, processes, patents, technical information of

8 any kind, contracts, agreements, and leases.

9 (2) EXCEPTION.—Facilities, real estate, improve10 ments, and equipment related to the gaseous diffusion,

11 and gas centrifuge, uranium enrichment programs of

12 the Secretary shall not transfer under paragraph

13 (1)(B).

14 (3) EXPIRATION OF TRANSFER AUTHORITY.—The

15 President’s authority to transfer property under this

16 subsection shall expire upon the privatization date.

17 (c) LIABILITY FOR PATENT AND RELATED CLAIMS.—

18 With respect to any right, title, or interest provided to the

19 Corporation under subsection (a) or (b), the Corporation

20 shall have sole liability for any payments made or awards

21 under section 157 b. (3) of the Atomic Energy Act of 1954

22 (42 U.S.C. 2187(b)(3)), or any settlements or judgments in23 volving claims for alleged patent infringement. Any royalty

24 agreement under subsection (a) of this section shall provide

25 for a reduction of royalty payments to the Secretary to off-
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1 set any payments, awards, settlements, or judgments under

2 this subsection.

3 SEC. 5015. GASEOUS DIFFUSION TECHNOLOGY.

4 (a) TRANSFER OF RIGHTS.—The Corporation shall

5 have the exclusive commercial rights for both uranium en6 richment and non-uranium enrichment uses of any patents,

7 patent applications, trade secrets, and other technical infor8 mation related to the gaseous diffusion technology owned

9 or controlled by the Department of Energy, or by the United

10 States but under control or custody of the Department of

11 Energy. The Corporation shall enter into an exclusive li12 censing agreement with the Department of Energy provid13 ing for—

14 (1) the payment of royalties of 3 percent of the

15 gross, pre-tax revenues realized by the Corporation

16 from its non-uranium enrichment commercial uses of

17 such patents, patent applications, trade secrets, and

18 other technical information,

19 (2) the reduction of such royalties to offset any

20 payments, awards, settlements, or judgments rendered

21 against the Corporation in its deployment or licens22 ing of the exclusive commercial rights under this sec23 tion, and

24 (3) the reservation of a non-exclusive, royalty25 free right to the United States Government to use
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1 such patents, patent applications, trade secrets, and

2 other technical information solely for Governmental

3 purposes.

4 (b) IMPROVEMENTS.—New patents, trade secrets, and

5 other technical information developed for commercial appli6 cations that derive from the gaseous diffusion technology

7 initially licensed by the Corporation shall be at the Cor8 poration’s expense and shall be free from royalties to the

9 Department of Energy.

10 SEC. 5016. APPLICATION OF CERTAIN LAWS.

11 (a) OSHA.—(1) As of the privatization date, the pri12 vate corporation shall be subject to and comply with the

13 Occupational Safety and Health Act of 1970 (29 U.S.C.

14 651 et seq.).

15 (2) The Nuclear Regulatory Commission and the Occu16 pational Safety and Health Administration shall, within

17 90 days after the enactment of this subtitle, enter into a

18 memorandum of agreement to govern the exercise of their

19 authority over occupational safety and health hazards at

20 the gaseous diffusion plants, including inspection, inves21 tigation, enforcement, and rulemaking relating to such haz22 ards.

23 (b) ANTITRUST LAWS.—For purposes of the antitrust

24 laws, the performance by the private corporation of a

25 ‘‘matched import’’ contract under the Suspension Agree-
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1 ment shall be considered to have occurred prior to the pri2 vatization date, if at the time of privatization, such con3 tract had been agreed to by the parties in all material terms

4 and confirmed by the Secretary of Commerce under the Sus5 pension Agreement.

6 (c) ENERGY REORGANIZATION ACT REQUIREMENTS.—

7 (1) The private corporation and its contractors shall be sub8 ject to the provisions of section 211 of the Energy Reorga9 nization Act of 1974 (42 U.S.C. 5851) to the same extent

10 as an employer subject to such section.

11 (2) With respect to the operation of the facilities leased

12 by the private corporation, section 206 of the Energy Reor13 ganization Act of 1974 (42 U.S.C. 5846) shall apply to the

14 directors and officers of the private corporation.

15 SEC. 5017. AMENDMENTS TO THE ATOMIC ENERGY ACT.

16 (a) REPEAL.—(1) Chapters 22 through 26 of the Atom17 ic Energy Act of 1954 (42 U.S.C. 1201–1608) are repealed

18 as of the privatization date.

19 (2) The table of contents of such Act is amended as of

20 the privatization date by striking the items referring to sec21 tions repealed by paragraph (1).

22 (b) NRC LICENSING.—(1) Section 11v. of the Atomic

23 Energy Act of 1954 (42 U.S.C. 2014v.) is amended by strik24 ing ‘‘or the construction and operation of a uranium en-
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1 richment facility using Atomic Vapor Laser Isotope Sepa2 ration technology’’.

3 (2) Section 193 of the Atomic Energy Act of 1954 (42

4 U.S.C. 2243) is amended by adding at the end the following:

5 ‘‘(f) LIMITATION.—No license or certificate of compli6 ance may be issued to the United States Enrichment Cor7 poration or its successor under section 53, 63, 193, or 1701,

8 if in the opinion of the Commission, the issuance of such

9 a license or certificate of compliance—

10 ‘‘(1) would be inimical to the common defense

11 and security of the United States; or

12 ‘‘(2) would be inimical to the maintenance of a

13 reliable and economical domestic source of enrichment

14 services because of the nature and extent of the owner15 ship, control, or domination of the Corporation by a

16 foreign corporation or a foreign government or any

17 other relevant factors or circumstances.’’.

18 (3) Section 1701(c)(2) of the Atomic Energy Act of

19 1954 (42 U.S.C. 2297f(c)(2)) is amended to read as follows:

20 ‘‘(2) PERIODIC APPLICATION FOR CERTIFICATE

21 OF COMPLIANCE.—The Corporation shall apply to the

22 Nuclear Regulatory Commission for a certificate of

23 compliance under paragraph (1) periodically, as de24 termined by the Commission, but not less than every

25 5 years. The Commission shall review any such appli-
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1 cation and any determination made under subsection

2 (b)(2) shall be based on the results of any such re3 view.’’.

4 (4) Section 1702(a) of the Atomic Energy Act of 1954

5 (42 U.S.C. 2297f–1(a)) is amended—

6 (1) by striking ‘‘other than’’ and inserting ‘‘in7 cluding’’, and

8 (2) by striking ‘‘sections 53 and 63’’ and insert9 ing ‘‘sections 53, 63, and 193’’.

10 (c) JUDICIAL REVIEW OF NRC ACTIONS.—Section

11 189b. of the Atomic Energy Act of 1954 (42 U.S.C. 2239(b))

12 is amended to read as follows:

13 ‘‘b. The following Commission actions shall be subject

14 to judicial review in the manner prescribed in chapter 158

15 of title 28, United States Code and chapter 7 of title 5,

16 United States Code:

17 ‘‘(1) Any final order entered in any proceeding

18 of the kind specified in subsection (a).

19 ‘‘(2) Any final order allowing or prohibiting a

20 facility to begin operating under a combined con21 struction and operating license.

22 ‘‘(3) Any final order establishing by regulation

23 standards to govern the Department of Energy’s gase24 ous diffusion uranium enrichment plants, including
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1 any such facilities leased to a corporation established

2 under the USEC Privatization Act.

3 ‘‘(4) Any final determination relating to whether

4 the gaseous diffusion plants, including any such fa5 cilities leased to a corporation established under the

6 USEC Privatization Act, are in compliance with the

7 Commission’s standards governing the gaseous diffu8 sion plants and all applicable laws.’’.

9 (d) CIVIL PENALTIES.—Section 234 a. of the Atomic

10 Energy Act of 1954 (42 U.S.C. 2282(a)) is amended by—

11 (1) striking ‘‘any licensing provision of section

12 53, 57, 62, 63, 81, 82, 101, 103, 104, 107, or 109’’

13 and inserting: ‘‘any licensing or certification provi14 sion of section 53, 57, 62, 63, 81, 82, 101, 103, 104,

15 107, 109, or 1701’’; and

16 (2) by striking ‘‘any license issued thereunder’’

17 and inserting: ‘‘any license or certification issued

18 thereunder’’.

19 (e) REFERENCES TO THE CORPORATION.—Following

20 the privatization date, all references in the Atomic Energy

21 Act of 1954 to the United States Enrichment Corporation

22 shall be deemed to be references to the private corporation.
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1 SEC. 5018. AMENDMENTS TO OTHER LAWS.

2 (a) DEFINITION OF GOVERNMENT CORPORATION.—As

3 of the privatization date, section 9101(3) of title 31, United

4 States Code, is amended by striking subparagraph (N).

5 (b) DEFINITION OF THE CORPORATION.—Section 1018

6 (1) of the Energy Policy Act of 1992 (42 U.S.C. 2296b–

7 7(1)) is amended by adding at the end ‘‘or its successor.’’.

8 Subtitle B—Department of the

9 Interior Conveyances

10 SEC. 5101. SHORT TITLE.

11 This subtitle may be cited as the ‘‘Helium Act of

12 1995’’.

13 SEC. 5102. AMENDMENT OF HELIUM ACT.

14 Except as otherwise expressly provided, whenever in

15 this part an amendment or repeal is expressed in terms of

16 an amendment to, or repeal of, a section or other provision,

17 the reference shall be considered to be made to a section or

18 other provision of the Helium Act (50 U.S.C. 167 to 167n).

19 SEC. 5103. AUTHORITY OF SECRETARY.

20 Sections 3, 4, and 5 are amended to read as follows:

21 ‘‘SEC. 3. AUTHORITY OF SECRETARY.

22 ‘‘(a) EXTRACTION AND DISPOSAL OF HELIUM ON FED23 ERAL LANDS.—

24 ‘‘(1) IN GENERAL.—The Secretary may enter

25 into agreements with private parties for the recovery

26 and disposal of helium on Federal lands upon such
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1 terms and conditions as the Secretary deems fair, rea2 sonable, and necessary.

3 ‘‘(2) LEASEHOLD RIGHTS.—The Secretary may

4 grant leasehold rights to any such helium.

5 ‘‘(3) LIMITATION.—The Secretary may not enter

6 into any agreement by which the Secretary sells such

7 helium other than to a private party with whom the

8 Secretary has an agreement for recovery and disposal

9 of helium.

10 ‘‘(4) REGULATIONS.—Agreements under para11 graph (1) may be subject to such regulations as may

12 be prescribed by the Secretary.

13 ‘‘(5) EXISTING RIGHTS.—An agreement under

14 paragraph (1) shall be subject to any rights of any

15 affected Federal oil and gas lessee that may be in ex16 istence prior to the date of the agreement.

17 ‘‘(6) TERMS AND CONDITIONS.—An agreement

18 under paragraph (1) (and any extension or renewal

19 of an agreement) shall contain such terms and condi20 tions as the Secretary may consider appropriate.

21 ‘‘(7) PRIOR AGREEMENTS.—This subsection shall

22 not in any manner affect or diminish the rights and

23 obligations of the Secretary and private parties under

24 agreements to dispose of helium produced from Fed25 eral lands in existence on the date of enactment of the
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1 Helium Act of 1995 except to the extent that such

2 agreements are renewed or extended after that date.

3 ‘‘(b) STORAGE, TRANSPORTATION AND SALE.—The

4 Secretary may store, transport, and sell helium only in ac5 cordance with this Act.

6 ‘‘SEC. 4. STORAGE, TRANSPORTATION, AND WITHDRAWAL

7 OF CRUDE HELIUM.

8 ‘‘(a) STORAGE, TRANSPORTATION AND WITH9 DRAWAL.—The Secretary may store, transport and with10 draw crude helium and maintain and operate crude helium

11 storage facilities, in existence on the date of enactment of

12 the Helium Act of 1995 at the Bureau of Mines Cliffside

13 Field, and related helium transportation and withdrawal

14 facilities.

15 ‘‘(b) CESSATION OF PRODUCTION, REFINING, AND

16 MARKETING.—Not later than 18 months after the date of

17 enactment of the Helium Act of 1995, the Secretary shall

18 cease producing, refining, and marketing refined helium

19 and shall cease carrying out all other activities relating to

20 helium which the Secretary was authorized to carry out

21 under this Act before the date of enactment of the Helium

22 Act of 1995, except activities described in subsection (a).

23 ‘‘(c) DISPOSAL OF FACILITIES.—

24 ‘‘(1) IN GENERAL.—Subject to paragraph (5),

25 not later than 18 months after the cessation of activi-
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1 ties referred to in section (b) of this section, the Sec2 retary shall designate as excess property and dispose

3 of all facilities, equipment, and other real and per4 sonal property, and all interests therein, held by the

5 United States for the purpose of producing, refining

6 and marketing refined helium.

7 ‘‘(2) APPLICABLE LAW.—The disposal of such

8 property shall be in accordance with the Federal

9 Property and Administrative Services Act of 1949.

10 ‘‘(3) PROCEEDS.—All proceeds accruing to the

11 United States by reason of the sale or other disposal

12 of such property shall be treated as moneys received

13 under this chapter for purposes of section 6(f).

14 ‘‘(4) COSTS.—All costs associated with such sale

15 and disposal (including costs associated with termi16 nation of personnel) and with the cessation of activi17 ties under subsection (b) shall be paid from amounts

18 available in the helium production fund established

19 under section 6(f).

20 ‘‘(5) EXCEPTION.—Paragraph (1) shall not

21 apply to any facilities, equipment, or other real or

22 personal property, or any interest therein, necessary

23 for the storage, transportation and withdrawal of

24 crude helium or any equipment, facilities, or other

25 real or personal property, required to maintain the
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1 purity, quality control, and quality assurance of

2 crude helium in the Bureau of Mines Cliffside Field.

3 ‘‘(d) EXISTING CONTRACTS.—

4 ‘‘(1) IN GENERAL.—All contracts that were en5 tered into by any person with the Secretary for the

6 purchase by the person from the Secretary of refined

7 helium and that are in effect on the date of the enact8 ment of the Helium Act of 1995 shall remain in force

9 and effect until the date on which the refining oper10 ations cease, as described in subsection (b).

11 ‘‘(2) COSTS.—Any costs associated with the ter12 mination of contracts described in paragraph (1)

13 shall be paid from the helium production fund estab14 lished under section 6(f).

15 ‘‘SEC. 5. FEES FOR STORAGE, TRANSPORTATION AND WITH16 DRAWAL.

17 ‘‘(a) IN GENERAL.—Whenever the Secretary provides

18 helium storage withdrawal or transportation services to any

19 person, the Secretary shall impose a fee on the person to

20 reimburse the Secretary for the full costs of providing such

21 storage, transportation, and withdrawal.

22 ‘‘(b) TREATMENT.—All fees received by the Secretary

23 under subsection (a) shall be treated as moneys received

24 under this Act for purposes of section 6(f).’’.
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1 SEC. 5104. SALE OF CRUDE HELIUM.

2 (a) Subsection 6(a) is amended by striking ‘‘from the

3 Secretary’’ and inserting ‘‘from persons who have entered

4 into enforceable contracts to purchase an equivalent amount

5 of crude helium from the Secretary’’.

6 (b) Subsection 6(b) is amended—

7 (1) by inserting ‘‘crude’’ before ‘‘helium’’; and

8 (2) by adding the following at the end: ‘‘Except

9 as may be required by reason of subsection (a), sales

10 of crude helium under this section shall be in

11 amounts as the Secretary determines, in consultation

12 with the helium industry, necessary to carry out this

13 subsection with minimum market disruption.’’.

14 (c) Subsection 6(c) is amended—

15 (1) by inserting ‘‘crude’’ after ‘‘Sales of’’; and

16 (2) by striking ‘‘together with interest as pro17 vided in this subsection’’ and all that follows through

18 the end of the subsection and inserting ‘‘all funds re19 quired to be repaid to the United States as of October

20 1, 1994 under this section (referred to in this sub21 section as ‘repayable amounts’). The price at which

22 crude helium is sold by the Secretary shall not be less

23 than the amount determined by the Secretary by—

24 ‘‘(i) dividing the outstanding amount of

25 such repayable amounts by the volume (in mil26 lion cubic feet) of crude helium owned by the
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1 United States and stored in the Bureau of Mines

2 Cliffside Field at the time of the sale concerned,

3 and

4 ‘‘(ii) adjusting the amount determined

5 under paragraph (1) by the Consumer Price

6 Index for years beginning after December 31,

7 1994.’’.

8 (d) Subsection 6(d) is amended to read as follows:

9 ‘‘(d) EXTRACTION OF HELIUM FROM DEPOSITS ON

10 FEDERAL LANDS.—All moneys received by the Secretary

11 from the sale or disposition of helium on Federal lands shall

12 be paid to the Treasury and credited against the amounts

13 required to be repaid to the Treasury under subsection (c).’’.

14 (e) Subsection 6(e) is repealed.

15 (f) Subsection (f) is amended—

16 (A) by striking ‘‘(f)’’ and inserting ‘‘(e)(1)’’;

17 and

18 (B) by adding the following at the end:

19 ‘‘(2)(A) Within 7 days after the commencement of each

20 fiscal year after the disposal of the facilities referred to in

21 section 4(c), all amounts in such fund in excess of

22 $2,000,000 (or such lesser sum as the Secretary deems nec23 essary to carry out this Act during such fiscal year) shall

24 be paid to the Treasury and credited as provided in para25 graph (1).
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1 ‘‘(B) On repayment of all amounts referred to in sub2 section (c), the fund established under this section shall be

3 terminated and all moneys received under this Act shall be

4 deposited in the general fund of the Treasury.’’.

5 SEC. 5105. ELIMINATION OF STOCKPILE.

6 Section 8 is amended to read as follows:

7 ‘‘SEC. 8. ELIMINATION OF STOCKPILE.

8 ‘‘(a) STOCKPILE SALES.—

9 ‘‘(1) COMMENCEMENT.—Not later than January

10 1, 2005, the Secretary shall commence offering for sale

11 crude helium from helium reserves owned by the Unit12 ed States in such amounts as may be necessary to dis13 pose of all such helium reserves in excess of

14 600,000,000 cubic feet by January 1, 2015.

15 ‘‘(2) TIMES OF SALE.—The sales shall be at such

16 times during each year and in such lots as the Sec17 retary determines, in consultation with the helium in18 dustry, to be necessary to carry out this subsection

19 with minimum market disruption.

20 ‘‘(3) PRICE.—The price for all sales under para21 graph (1), as determined by the Secretary in con22 sultation with the helium industry, shall be such price

23 as will ensure repayment of the amounts required to

24 be repaid to the Treasury under section 6(c).
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1 ‘‘(b) DISCOVERY OF ADDITIONAL RESERVES.—The dis2 covery of additional helium reserves shall not affect the duty

3 of the Secretary to make sales of helium under subsection

4 (a).’’.

5 SEC. 5106. REPEAL OF AUTHORITY TO BORROW.

6 Sections 12 and 15 are repealed.

7 Subtitle C—Arctic Coastal Plain

8 Leasing and Revenue Act

9 SEC. 5201. SHORT TITLE.

10 This subtitle may be cited as the ‘‘Arctic Coastal Plain

11 Leasing and Revenue Act of 1995’’.

12 SEC. 5202. PURPOSE AND POLICY.

13 The Congress hereby declares that it is the purpose and

14 policy of this subtitle to authorize competitive oil and gas

15 leasing and development to proceed on the Coastal Plain

16 in a manner consistent with protection of the environment,

17 maintenance of fish and wildlife and their habitat, and the

18 interests of the area’s subsistence users, and in a manner

19 that will reduce the Federal deficit by an estimated $1.3

20 billion over the next seven years.

21 SEC. 5203. DEFINITIONS.

22 When used in this subtitle the term—

23 (1) ‘‘Coastal Plain’’ means that area identified

24 as such in the map entitled ‘‘Arctic National Wildlife

25 Refuge’’, dated August 1980, as referenced in section
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1 1002(b) of the Alaska National Interest Lands Con2 servation Act of 1980 (16 U.S.C. 3142(b)(1)) compris3 ing approximately 1,549,000 ACRES acres; and

4 (2) ‘‘Secretary’’ means the Secretary of the Inte5 rior or the Secretary’s designee.

6 SEC. 5204. LEASING PROGRAM FOR LANDS WITHIN THE

7 COASTAL PLAIN.

8 (a) AUTHORIZATION.—The Congress hereby authorizes

9 and directs the Secretary and other appropriate Federal of10 ficers and agencies to take such actions as are necessary

11 to establish and implement a competitive oil and gas leas12 ing program that will result in an environmentally sound

13 program for the exploration, development, and production

14 of the oil and gas resources of the Coastal Plain, and no

15 further findings or decisions shall be required to implement

16 this authorization. The Secretary shall administer the pro17 visions of this subtitle through regulations, lease terms, con18 ditions, restrictions, prohibitions, stipulations and other

19 provisions that ensure the oil and gas exploration, develop20 ment, and production activities on the Coastal Plain will

21 result in no significant adverse effect on fish and wildlife,

22 their habitat, and the environment, and shall require the

23 application of the best commercially available technology

24 for oil and gas exploration, development, and production,

25 on all new exploration, development, and production oper-
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1 ations, and whenever practicable, on existing operations,

2 and in a manner to ensure the receipt of fair market value

3 by the public for the mineral resources to be leased.

4 (b) REPEAL.—The prohibitions and limitations con5 tained in section 1003 of the Alaska National Interest

6 Lands Conservation Act of 1980 (16 U.S.C. 3143) are here7 by repealed.

8 (c) SOLE AUTHORITY.—This subtitle shall be the sole

9 authority for leasing on the Coastal Plain.

10 (d) FEDERAL LAND.—The Coastal Plain shall be con11 sidered ‘‘Federal land’’ for the purposes of the Federal Oil

12 and Gas Royalty Management Act of 1982.

13 SEC. 5205. RULES AND REGULATIONS.

14 (a) PROMULGATION.—The Secretary shall prescribe

15 such rules and regulations as may be necessary to carry

16 out the purposes and provisions of this subtitle, including

17 rules and regulations relating to protection of the fish and

18 wildlife, their habitat, and the environment of the Coastal

19 Plain. Such rules and regulations shall be promulgated

20 within eighteen months after the date of enactment of this

21 subtitle and shall, as of their effective date, apply to all

22 operations conducted under a lease issued or maintained

23 under the provisions of this subtitle and all operations on

24 the Coastal Plain related to the leasing, exploration, devel25 opment and production of oil and gas.
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1 (b) REVISION OF REGULATIONS.—The Secretary shall

2 periodically review and, if appropriate, revise the rules and

3 regulations issued under subsection (a) of this section to re4 flect any significant biological, environmental, or engineer5 ing data which come to the Secretary’s attention.

6 SEC. 5206. ADEQUACY OF THE DEPARTMENT OF THE INTE7 RIOR’S LEGISLATIVE ENVIRONMENTAL IM8 PACT STATEMENT.

9 The ‘‘Final Legislative Environmental Impact State10 ment’’ (April 1987) on the Coastal Plain prepared pursu11 ant to section 1002 of the Alaska National Interest Lands

12 Conservation Act of 1980 (16 U.S.C. 3142) and section

13 102(2)(C) of the National Environmental Policy Act of

14 1969 (42 U.S.C. 4332(2)(C)) is hereby found by the Con15 gress to be adequate to satisfy the legal requirements under

16 the National Environmental Policy Act of 1969 with respect

17 to actions authorized to be taken by the Secretary to develop

18 and promulgate the regulations for the establishment of a

19 leasing program authorized by this subtitle and to conduct

20 the first lease sale authorized by this subtitle.

21 SEC. 5207. LEASE SALES.

22 (a) LEASE SALES.—Lands may be leased pursuant to

23 the provisions of this subtitle to any person qualified to ob24 tain a lease for deposits of oil and gas under the Mineral

25 Leasing Act, as amended (30 U.S.C. 181).
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1 (b) PROCEDURES.—The Secretary shall, by regulation,

2 establish procedures for—

3 (1) receipt and consideration of sealed nomina4 tions for any area in the Coastal Plain for inclusion

5 in, or exclusion (as provided in subsection (d)) from,

6 a lease sale; and

7 (2) public notice of and comment on designation

8 of areas to be included in, or excluded per subsection

9 (d) from, a lease sale.

10 (c) LEASE SALES ON COASTAL PLAIN.—The Secretary

11 shall, by regulation, provide for lease sales of lands on the

12 Coastal Plain. When lease sales are to be held, they shall

13 occur after the nomination process provided for in sub14 section (b) of this section. For the first lease sale, the Sec15 retary shall offer for lease those acres receiving the greatest

16 number of nominations, but not to exceed a total of three

17 hundred thousand acres. If the total acreage nominated is

18 less than three hundred thousand acres, the Secretary shall

19 include in such sale any other acreage which he believes

20 has the highest resource potential, but in no event shall more

21 than three hundred thousand acres of the Coastal Plain be

22 offered in such sale. Thereafter, no more than three hundred

23 thousand acres of the Coastal Plain may be leased in any

24 one lease sale. The initial lease sale shall be held within

25 twenty-four months of the date of enactment of this subtitle.
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1 The second lease sale shall be held twenty-four months after

2 the initial sale, with additional sales conducted every twen3 ty-four months thereafter so long as sufficient interest in

4 development exists to warrant, in the Secretary’s judgment,

5 the conduct of such sales.

6 (d) SPECIAL AREAS.—The Secretary, after consulta7 tion with the State of Alaska, City of Kaktovik, and the

8 North Slope Borough, is authorized to designate up to a

9 total of 60,000 acres of the Coastal Plain as Special Areas

10 and close it to leasing if the Secretary determines that these

11 lands are of such unique character and interest so as to

12 require special management and regulatory protection. The

13 Secretary shall notify the Committee on Energy and Natu14 ral Resources of the Senate and the Committee on Resources

15 of the House of Representatives ninety days in advance of

16 making such designations. The Secretary may permit leas17 ing of all or portions of any lands within the Coastal Plain

18 designated as Special Areas by setting lease terms that limit

19 or condition surface use and occupancy by lessees of such

20 lands but permit the use of horizontal drilling technology

21 from sites on leases located outside the designated Special

22 Areas.

23 SEC. 5208. GRANT OF LEASES BY THE SECRETARY.

24 (a) IN GENERAL.—The Secretary is authorized to

25 grant to the highest responsible qualified bidder by sealed
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1 competitive cash bonus bid any lands to be leased on the

2 Coastal Plain upon payment by the lessee of such bonus

3 as may be accepted by the Secretary and of such royalty

4 as may be fixed in the lease, which shall be not less than

121 5 ⁄2 per centum in amount or value of the production re6 moved or sold from the lease.

7 (b) ANTITRUST REVIEW.—Following each notice of a

8 proposed lease sale and before the acceptance of bids and

9 the issuance of leases based on such bids, the Secretary shall

10 allow the Attorney General, in consultation with the Fed11 eral Trade Commission, thirty days to perform an antitrust

12 review of the results of such lease sale on the likely effects

13 the issuance of such leases would have on competition and

14 shall advise the Secretary with respect to such review, in15 cluding any recommendation for the nonacceptance of any

16 bid or the imposition of terms or conditions on any lease,

17 as may be appropriate to prevent any situation inconsist18 ent with the antitrust laws.

19 (c) SUBSEQUENT TRANSFERS.—No lease issued under

20 this subtitle may be sold, exchanged, assigned, or otherwise

21 transferred except with the approval of the Secretary. Prior

22 to any such approval the Secretary shall consult with, and

23 give due consideration to the views of, the Attorney General.

24 (d) IMMUNITY.—Nothing in this subtitle shall be

25 deemed to convey to any person, association, corporation,
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1 or other business organization immunity from civil or

2 criminal liability, or to create defenses to actions, under

3 any antitrust law.

4 (e) DEFINITIONS.—As used in this section, the term—

5 (1) ‘‘antitrust review’’ shall be deemed an ‘‘anti6 trust investigation’’ for the purposes of the Antitrust

7 Civil Process Act (15 U.S.C. 1311); and

8 (2) ‘‘antitrust laws’’ means those Acts set forth

9 in section 1 of the Clayton Act (15 U.S.C. 12) as

10 amended.

11 SEC. 5209. LEASE TERMS AND CONDITIONS.

12 An oil or gas lease issued pursuant to this subtitle

13 shall—

14 (1) be for a tract consisting of a compact area

15 not to exceed five thousand seven hundred sixty acres,

16 or nine surveyed or protracted sections which shall be

17 as compact in form as possible;

18 (2) be for an initial period of ten years and shall

19 be extended for so long thereafter as oil or gas is pro20 duced in paying quantities from the lease or unit

21 area to which the lease is committed or for so long as

22 drilling or reworking operations, as approved by the

23 Secretary, are conducted on the lease or unit area;

24 (3) require the payment of royalty as provided

25 for in section 5208 of this subtitle;
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1 (4) require that exploration activities pursuant

2 to any lease issued or maintained under this subtitle

3 shall be conducted in accordance with an exploration

4 plan or a revision of such plan approved by the Sec5 retary;

6 (5) require that all development and production

7 pursuant to a lease issued or maintained pursuant to

8 this subtitle shall be conducted in accordance with a

9 development and production plan approved by the

10 Secretary;

11 (6) require posting of bond as required by section

12 5210 of this subtitle;

13 (7) forbid the flaring of natural gas from any

14 well unless the Secretary finds that such flaring is

15 necessary to alleviate a temporary emergency situa16 tion or to conduct testing or work-over operations;

17 (8) contain such rental and other provisions as

18 the Secretary may prescribe at the time of offering the

19 area for lease;

20 (9) provide that the Secretary may direct or as21 sent to the suspension of operations and production

22 under any lease granted under the terms of this sub23 title in the interest of conservation of the resource or

24 where there is no available system to transport the re25 source. If such a suspension is directed or assented to
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1 by the Secretary, any payment of rental prescribed by

2 such lease shall be suspended during such period of

3 suspension of operations and production, and the

4 term of the lease shall be extended by adding any such

5 suspension period thereto;

6 (10) provide that whenever the owner of a

7 nonproducing lease fails to comply with any of the

8 provisions of this subtitle, or of any applicable provi9 sion of Federal or State environmental law, or of the

10 lease, or of any regulation issued under this subtitle,

11 such lease may be canceled by the Secretary if such

12 default continues for more than thirty days after

13 mailing of notice by registered letter to the lease

14 owner at the lease owner’s record post office address

15 of record;

16 (11) provide that whenever the owner of any pro17 ducing lease fails to comply with any of the provi18 sions of this subtitle, or of any applicable provision

19 of Federal or State environmental law, or of the lease,

20 or of any regulation issued under this subtitle, such

21 lease may be forfeited and canceled by any appro22 priate proceeding brought by the Secretary in any

23 United States district court having jurisdiction under

24 the provisions of this subtitle;
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1 (12) provide that cancellation of a lease under

2 this subtitle shall in no way release the owner of the

3 lease from the obligation to provide for reclamation of

4 the lease site;

5 (13) require that no lease issued under the au6 thority of this subtitle shall be assigned or sublet, ex7 cept with the consent of the Secretary;

8 (14) allow the lessee, at the discretion of the Sec9 retary, to make written relinquishment of all rights

10 under any lease issued pursuant to this subtitle, and

11 the Secretary shall accept the relinquishment by the

12 lessee of any lease issued under this subtitle where

13 there has not been surface disturbance on the lands

14 covered by the lease;

15 (15) provide that for the purpose of conserving

16 the natural resources of any oil or gas pool, field, or

17 like area, or any part thereof, and in order to avoid

18 the unnecessary duplication of facilities, to protect the

19 environment of the Coastal Plain, and to protect cor20 relative rights, the Secretary shall require that, to the

21 greatest extent practicable, lessees unite with each

22 other in collectively adopting and operating under a

23 cooperative or unit plan of development for operation

24 of such pool, field, or like area, or any part thereof,

25 and the Secretary is also authorized and directed to
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1 enter into such agreements as are necessary or appro2 priate for the protection of the United States against

3 drainage;

4 (16) require that the holder of a lease or leases

5 on lands within the Coastal Plain shall be fully re6 sponsible and liable for the reclamation of lands with7 in the Coastal Plain and any other Federal lands ad8 versely affected in connection with exploration, devel9 opment, production or transportation activities on a

10 lease within the Coastal Plain by the holder of a lease

11 or as a result of activities conducted on the lease by

12 any of the leaseholder’s subcontractors or agents;

13 (17) provide that the holder of a lease may not

14 delegate or convey, by contract or otherwise, the rec15 lamation responsibility and liability to another party

16 without the express written approval of the Secretary;

17 (18) provide that the standard of reclamation for

18 lands required to be reclaimed under this subtitle be,

19 as nearly as practicable, a condition capable of sup20 porting the uses which the lands were capable of sup21 porting prior to any exploration, development, or pro22 duction activities, or upon application by the lessee,

23 to a higher or better use as approved by the Secretary;

24 (19) contain the terms and conditions relating to

25 protection of fish and wildlife, their habitat, and the
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1 environment, as required by section 5204 (a) of this

2 subtitle; and

3 (20) contain such other provisions as the Sec4 retary determines necessary to ensure compliance

5 with the provisions of this subtitle and the regulations

6 issued thereunder.

7 SEC. 5210. BONDING REQUIREMENTS TO ENSURE FINAN8 CIAL RESPONSIBILITY OF LESSEE AND AVOID

9 FEDERAL LIABILITY.

10 (a) REQUIREMENT.—The Secretary shall, by rule or

11 regulation, establish such standards as may be necessary

12 to ensure that an adequate bond, surety, or other financial

13 arrangement will be established prior to the commencement

14 of surface disturbing activities on any lease, to ensure the

15 complete and timely reclamation of the lease tract, and the

16 restoration of any lands or surface waters adversely affected

17 by lease operations after the abandonment or cessation of

18 oil and gas operations on the lease. Such bond, surety, or

19 financial arrangement is in addition to, and not in lieu,

20 of any bond, surety, or financial arrangement required by

21 any other regulatory authority or required by any other

22 provision of law.

23 (b) AMOUNT.—The bond, surety, or financial arrange24 ment shall be in an amount—
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1 (1) to be determined by the Secretary to provide

2 for reclamation of the lease site in accordance with an

3 approved or revised exploration or development and

4 production plan; plus

5 (2) an amount set by the Secretary consistent

6 with the type of operations proposed, to provide the

7 means for rapid and effective cleanup, and to mini8 mize damages resulting from an oil spill, the escape

9 of gas, refuse, domestic wastewater, hazardous or toxic

10 substances, or fire caused by oil and gas activities.

11 (c) ADJUSTMENT.—In the event that an approved ex12 ploration or development and production plan is revised,

13 the Secretary may adjust the amount of the bond, surety,

14 or other financial arrangement to conform to such modified

15 plan.

16 (d) DURATION.—The responsibility and liability of the

17 lessee and its surety under the bond, surety, or other finan18 cial arrangement shall continue until such time as the Sec19 retary determines that there has been compliance with the

20 terms and conditions of the lease and all applicable law.

21 (e) TERMINATION.—Within sixty days after determin22 ing that there has been compliance with the terms and con23 ditions of the lease and all applicable laws, the Secretary,

24 after consultation with affected Federal and State agencies,

25 shall notify the lessee that the period of liability under the
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1 bond, surety, or other financial arrangement has been ter2 minated.

3 SEC. 5211. OIL AND GAS INFORMATION.

4 (a) IN GENERAL.—(1) Any lessee or permittee conduct5 ing any exploration for, or development or production of,

6 oil or gas pursuant to this subtitle shall provide the Sec7 retary access to all data and information from any lease

8 granted pursuant to this subtitle (including processed and

9 analyzed) obtained from such activity and shall provide

10 copies of such data and information as the Secretary may

11 request. Such data and information shall be provided in

12 accordance with regulations which the Secretary shall pre13 scribe.

14 (2) If processed and analyzed information provided

15 pursuant to paragraph (1) of this subsection is provided

16 in good faith by the lessee or permittee, such lessee or per17 mittee shall not be responsible for any consequence of the

18 use or of reliance upon such processed and analyzed infor19 mation.

20 (3) Whenever any data or information is provided to

21 the Secretary, pursuant to paragraph (1) of this sub22 section—

23 (A) by a lessee or permittee, in the form and

24 manner of processing which is utilized by such lessee

25 or permittee in the normal conduct of business, the
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1 Secretary shall pay the reasonable cost of reproducing

2 such data and information; or

3 (B) by a lessee or permittee, in such other form

4 and manner of processing as the Secretary may re5 quest, the Secretary shall pay the reasonable cost of

6 processing and reproducing such data and informa7 tion.

8 (b) REGULATIONS.—The Secretary shall prescribe reg9 ulations to:

10 (1) assure that the confidentiality of privileged

11 or proprietary information received by the Secretary

12 under this section will be maintained; and

13 (2) set forth the time periods and conditions

14 which shall be applicable to the release of such infor15 mation.

16 SEC. 5212. EXPEDITED JUDICIAL REVIEW.

17 Any complaint seeking judicial review of an action of

18 the Secretary in promulgating any regulation under this

19 subtitle may be filed only in the United States Court of

20 Appeals for the District of Columbia, and such complaint

21 shall be filed within ninety days from the date of such pro22 mulgation, or after such date if such complaint is based

23 solely on grounds arising after such ninetieth day, in which

24 case the complaint must be filed within ninety days after

25 the complainant knew or reasonably should have known of
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1 the grounds for the complaint. Any complaint seeking judi2 cial review of any other actions of the Secretary under this

3 subtitle may be filed in any appropriate district court of

4 the United States, and such complaint must be filed within

5 ninety days from the date of the action being challenged,

6 or after such date if such complaint is based solely on

7 grounds arising after such ninetieth day, in which case the

8 complaint must be filed within ninety days after the com9 plainant knew or reasonably should have known of the

10 grounds for the complaint. Actions of the Secretary with

11 respect to which review could have been obtained under this

12 section shall not be subject to judicial review in any civil

13 or criminal proceeding for enforcement.

14 SEC. 5213. RIGHTS-OF-WAY ACROSS THE COASTAL PLAIN.

15 Notwithstanding title XI of the Alaska National Inter16 est Lands Conservation Act of 1980 (16 U.S.C. 3161 et

17 seq.), the Secretary is authorized and directed to grant, in

18 accordance with the provisions of section 28 (c) through (t)

19 and (v) through (y) of the Mineral Leasing Act of 1920 (30

20 U.S.C. 185), rights-of-way and easements across the Coastal

21 Plain for the transportation of oil and gas under such terms

22 and conditions as may be necessary so as not to result in

23 a significant adverse effect on the fish and wildlife, their

24 habitat, and the environment of the Coastal Plain. Such

25 terms and conditions shall include requirements that facili-
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1 ties be sited or modified so as to avoid unnecessary duplica2 tion of roads and pipelines. The regulations issued pursu3 ant to this subtitle shall include provisions granting of

4 rights-of-way across the Coastal Plain.

5 SEC. 5214. ENFORCEMENT OF SAFETY AND ENVIRON6 MENTAL REGULATIONS TO ENSURE COMPLI7 ANCE WITH TERMS AND CONDITIONS OF

8 LEASE.

9 (a) RESPONSIBILITY OF THE SECRETARY.—The Sec10 retary shall diligently enforce all regulations, lease terms,

11 conditions, restrictions, prohibitions, and stipulations pro12 mulgated pursuant to this subtitle.

13 (b) RESPONSIBILITY OF HOLDERS OF LEASE.—It shall

14 be the responsibility of any holder of a lease under this sub15 title to—

16 (1) maintain all operations within such lease

17 area in compliance with regulations intended to pro18 tect persons and property on, and fish and wildlife,

19 their habitat, and the environment of, the Coastal

20 Plain; and

21 (2) allow prompt access at the site of any oper22 ations subject to regulation under this subtitle to any

23 appropriate Federal or State inspector, and to pro24 vide such documents and records which are pertinent
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1 to occupational or public health, safety, or environ2 mental protection, as may be requested.

3 (c) ON-SITE INSPECTION.—The Secretary shall pro4 mulgate regulations to provide for—

5 (1) scheduled onsite inspection by the Secretary,

6 at least twice a year, of each facility on the Coastal

7 Plain which is subject to any environmental or safety

8 regulation promulgated pursuant to this subtitle or

9 conditions contained in any lease issued pursuant to

10 this subtitle to assure compliance with such environ11 mental or safety regulations or conditions; and

12 (2) periodic onsite inspection by the Secretary at

13 least once a year without advance notice to the opera14 tor of such facility to assure compliance with all envi15 ronmental or safety regulations.

16 SEC. 5215. NEW REVENUES.

17 (a) DISTRIBUTION OF REVENUES.—Notwithstanding

18 any other provision of law, all revenues received by the Fed19 eral Government from competitive bids, sales, bonuses, roy20 alties, rents, fees, interest or other income derived from the

21 leasing of oil and gas resources within the Coastal Plain

22 shall be deposited into the Treasury of the United States:

23 Provided, That 50 per centum of all such revenues shall

24 be paid by the Secretary of the Treasury semiannually, on

25 March 30th and on September 30th of each year, to the
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1 State of Alaska: Provided further, That the Secretary of the

2 Treasury shall monitor the total amount of bonus bid reve3 nue deposited into the Treasury from oil and gas leases is4 sued under the authority of this subtitle. All bonus bid reve5 nue deposited in the Treasury in excess of $2,600,000,000

6 shall be distributed as follows: 50 per centum to the State

7 of Alaska in the manner provided in this subsection and

8 50 per centum into a special fund established in the Treas9 ury of the United States known as the ‘‘National Park and

10 Wildlife Refuge Renewal Fund’’ (Renewal Fund).

11 (b) USE OF RENEWAL FUND.—Funds from the Re12 newal Fund shall be made available to the Secretary of the

13 Interior, without further appropriation, at the beginning

14 of each fiscal year in which funds are available, and may

15 be expended by the Secretary for infrastructure needs at

16 units of the National Park and Wildlife Refuge Systems,

17 including but not limited to facility refurbishment, repair

18 and replacement, interpretive media and exhibit repair and

19 replacement and infrastructure projects associated with

20 park and wildlife refuge resource protection: Provided, That

21 such amounts shall remain available until expended, and

22 that the Secretary shall develop procedures for the use of

23 the Renewal Fund that ensure accountability and dem24 onstrated results. Such procedures shall not take effect until

25 90 days after transmittal to the Committees on Energy and
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1 Natural Resources and Environment and Public Works of

2 the Senate and the appropriate Committees of the House

3 of Representatives: Provided further, That beginning the

4 first full fiscal year after funds are deposited in the Renewal

5 Fund, the Secretary shall submit an annual report to the

6 Congress, on a unit-by-unit basis, detailing the expendi7 tures of such receipts, and that any revenues made available

8 pursuant to this section shall be in addition to funds appro9 priated in the preceding fiscal year for the Park Service

10 and Fish and Wildlife Service and shall not result in a

11 reduction or offset of such appropriated funds.

12 Subtitle D—Park Entrance Fees

13 SEC. 5300. FEES.

14 (a) ADMISSION FEES.—Section 4(a) of the Land and

15 Water Conservation Fund Act of 1965 (16 U.S.C. 460l–

16 6a(a)) is amended:

17 (1) By deleting ‘‘fee-free travel areas’’ and ‘‘life18 time admission permit’’ from the subsection.

19 (2) By striking ‘‘$25’’ in the first sentence of

20 paragraph (1)(a)(i), and inserting ‘‘$50’’.

21 (3) By adding at the end of clause (ii) of para22 graph (1)(A) the following: ‘‘Such receipts shall be

23 made available, subject to appropriation, for author24 ized resource protection, rehabilitation and conserva25 tion projects as provided for by subsection (I), includ-
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1 ing projects to be carried out by the Public Land

2 Corps or any other conservation corps pursuant to the

3 Youth Conservation Corps Act of 1970 (16 U.S.C.

4 1701 and following), or other related programs or au5 thorities, on lands administered by the Secretary of

6 the Interior and the Secretary of Agriculture.’’.

7 (4) By striking ‘‘$15’’ in paragraph (a)(1)(B),

8 and inserting ‘‘$25’’.

9 (5) By striking the fifth and sixth sentences in

10 paragraph (a)(2), and by amending the fourth sen11 tence to read as follows: ‘‘The fee for a single-visit

12 permit at any designated area shall be collected on a

13 per person basis, not to exceed $6 per person, includ14 ing for those entering by private, noncommercial vehi15 cle.’’.

16 (6) By inserting the word ‘‘Great’’ before

17 ‘‘Smoky’’ in the third sentence of paragraph (a)(3),

18 and by striking the last sentence.

19 (7) By striking the second sentence in paragraph

20 (a)(4), in its entirety and inserting: ‘‘Such permit

21 shall be nontransferable, shall be issued for a one-time

22 charge of $10, and shall entitle the permittee to free

23 admission into any area designated pursuant to this

24 subsection.’’.
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1 (8) By amending the third sentence in para2 graph (a)(4), to read as follows: ‘‘No fees of any kind

3 shall be collected from any persons who have a right

4 of access for hunting or fishing privileges under a spe5 cific provision of law or treaty or who are engaged

6 in the conduct of official Federal, State, or local gov7 ernment business.’’.

8 (9) By striking paragraph (a)(5), in its entirety

9 and inserting: ‘‘The Secretary of the Interior and the

10 Secretary of Agriculture shall establish procedures

11 providing for the issuance of a lifetime admission

12 permit to any citizen of, or person legally domiciled

13 in, the United States, if such citizen or person applies

14 for such permit and is permanently disabled. Such

15 procedures shall assure that such permit shall be is16 sued only to persons who have been medically deter17 mined to be permanently disabled. Such permit shall

18 be nontransferable, shall be issued without charge,

19 and shall entitle the permittee and one accompanying

20 individual to general admission into any area des21 ignated pursuant to this subsection, notwithstanding

22 the method of travel.’’.

23 (10) By striking subparagraph (a)(6)(A), in its

24 entirety and inserting: ‘‘No later than 30 days after

25 the enactment date of this sentence, the Secretary of
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1 the Interior shall submit to the Committee on Energy

2 and Natural Resources of the United States Senate

3 and the Committee on Resources of the House of Rep4 resentatives a report on the admission fees proposed

5 to be charged at units of the National Park System.

6 The report shall include a list of units of the National

7 Park System and the admission fee proposed to be

8 charged at each unit. The Secretary of the Interior

9 shall also identify areas where such fees are author10 ized but not collected, including an explanation of the

11 reasons that such fees are not collected.’’.

12 (11) By striking paragraph (a)(9) in its entirety

13 and by renumbering current paragraph (10) as ‘‘(9)’’.

14 (12) By striking all but the last sentence in

15 paragraph (a)(11), and renumbering the remaining

16 sentence as ‘‘(a)(10)’’.

17 (13) By renumbering paragraph (a)(12) as

18 ‘‘(a)(11)’’.

19 (b) RECREATION FEES.—Section 4(b) of the Land and

20 Water Conservation Fund Act of 1965; 16 U.S.C. 460l–

21 6a(b)), is amended:

22 (1) By striking ‘‘fees for Golden Age Passport

23 permittees’’ from the heading.
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1 (2) By striking ‘‘personal collection of the fee by

2 an employee or agent of the Federal agency operating

3 the facility,’’.

4 (3) By striking ‘‘Any Golden Age Passport per5 mittee, or’’ and inserting ‘‘Any’’.

6 (c) CRITERIA, POSTING AND UNIFORMITY OF FEES.—

7 Section 4(d) of the Land and Water Conservation Fund Act

8 of 1965 (16 U.S.C. 460l–6a(d)) is amended by striking from

9 the first sentence, ‘‘recreation fees charged by non-Federal

10 public agencies,’’ and inserting: ‘‘fees charged by other pub11 lic and private entities,’’.

12 (d) PENALTY.—Section 4(e) of the Land and Water

13 Conservation Fund Act of 1965 (16 U.S.C. 460l–6a(e)) is

14 amended by deleting ‘‘of not more than $100.’’ and insert15 ing: ‘‘as provided by law.’’.

16 (e) TECHNICAL AMENDMENTS.—Section 4(h) of the

17 Land and Water Conservation Fund Act of 1965 (16 U.S.C.

18 460l–6a(h)), is amended—

19 (1) by striking ‘‘Bureau of Outdoor Recreation’’

20 and inserting: ‘‘National Park Service’’;

21 (2) by striking ‘‘Natural’’ in the phrase ‘‘Com22 mittee on Natural Resources of the House of Rep23 resentatives’’; and

24 (3) by striking ‘‘Bureau’’ and inserting: ‘‘Na25 tional Park Service’’;
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1 (f) USE OF FEES.—Section 4(i) of the Land and

2 Water Conservation Fund Act of 1965 (16 U.S.C. 460l–

3 6a(i)) is amended:

4 (1) By amending the subsection heading to read

5 as follows: ‘‘USE OF FEES.—’’.

6 (2) By striking ‘‘fee collection costs for that fiscal

7 year’’ in the first sentence of subparagraph (B) and

8 inserting: ‘‘fee collection costs for the immediately

9 preceding fiscal year’’ and by striking ‘‘section in

10 that fiscal year’’ and inserting in lieu thereof, ‘‘sec11 tion in such immediately preceding fiscal year.’’.

12 (3) By striking ‘‘in that fiscal year’’ in the sec13 ond sentence of subparagraph (B).

14 (4) By striking paragraph (4), and subpara15 graphs (A) and (B) in their entirety and inserting:

16 ‘‘Amounts covered into the special account for the Na17 tional Park Service shall be allocated among park

18 system units in accordance with subsection (j) of this

19 section for obligation or expenditure by the Director

20 of the National Park Service for park operations.’’.

21 (g) TIME OF REIMBURSEMENT.—Section 4(k) of the

22 Land and Water Conservation Fund Act of 1965 (16 U.S.C.

23 460l–6a(k)) is amended by striking the last sentence in its

24 entirety.
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1 (h) CHARGES FOR TRANSPORTATION PROVIDED BY

2 THE NATIONAL PARK SERVICE.—Section 4(l)(1) of the

3 Land and Water Conservation Fund Act of 1965 (16 U.S.C.

4 460l–6a(1)) is amended—

5 (1) by striking the word ‘‘viewing’’ from the sec6 tion heading and inserting ‘‘visiting’’, and

7 (2) by striking the word ‘‘view’’ from the first

8 sentence of subparagraph (1) and inserting ‘‘visit’’.

9 (i) COMMERCIAL TOUR USE FEES.—Section 4(n) of

10 the Land and Water Conservation Fund Act of 1965 (16

11 U.S.C. 460l–6a(n)) is further amended—

12 (1) By striking the first sentence of subsection

13 (n)(1) and inserting: ‘‘In the case of each unit of the

14 National Park System for which an admission fee is

15 charged under this section, the Secretary of the Inte16 rior shall establish, by October 1, 1995, a commercial

17 tour use fee in lieu of a per person admission fee to

18 be imposed on each vehicle entering the unit for the

19 purpose of providing commercial tour services within

20 the unit.’’.

21 (2) By striking the period at the end of sub22 section (n)(3) and inserting: ‘‘with written notifica23 tion of such adjustments provided to commercial tour

24 operators twelve months in advance of implementa25 tion.’’.
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1 (j) FEES FOR SPECIAL USES.—Section 4 of the Land

2 and Water Conservation Fund Act of 1965 (16 U.S.C. 460l–

3 6a)), is further amended by adding at the end the following:

4 ‘‘(o) FEES FOR COMMERCIAL/NON-RECREATIONAL

5 USES.—The Secretary of the Interior shall establish reason6 able fees for uses of National Park System units that require

7 special arrangements, including permits. Such fees shall be

8 set at a level as the Secretary deems necessary to ensure

9 that the United States will receive fair market value for

10 such use, and shall, at a minimum, cover all costs of provid11 ing necessary services associated with such use, except that

12 at the Secretary’s discretion, the Secretary may waive or

13 reduce such fees in the case of any nonprofit organization

14 or any organization using an area within the National

15 Park System for educational purposes. That portion of such

16 fee which exceeds the cost of providing necessary services

17 associated with such use shall be deposited into the Park

18 Renewal Fund.’’.

19 (k) CONFORMING AMENDMENTS.—

20 (1) Section 3 of Public Law 70–805 (45 Stat.

21 1300), is amended by striking the last sentence.

22 (2) Section 5(e) of Public Law 87–657 (76 Stat.

23 540; 16 U.S.C. 459c–5), is repealed.

24 (3) Section 3(b) of Public Law 87–750 (76 Stat.

25 747; 16 U.S.C. 398e(b)) is repealed.
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1 (4) Section 4(e) of Public Law 92–589 (86 Stat.

2 1299; 16 U.S.C. 460bb–3), is amended by striking the

3 first sentence.

4 (5) Section 6(j) of Public Law 95–348 (92 Stat.

5 487; 16 U.S.C. 410dd(j)) is repealed.

6 (6) Section 207 of Public Law 96–199 (94 Stat.

7 77; 16 U.S.C. 410ff–6) is repealed.

8 (7) Section 106 of Public Law 96–287 (94 Stat.

9 600; 16 U.S.C. 410gg–5) is amended by striking the

10 last sentence.

11 (8) Section 204 of Public Law 96–287 (94 Stat.

12 601) is amended by striking the last sentence.

13 (9) Section 5 of Public Law 96–428 (94 Stat.

14 1843; 16 U.S.C. 461 note) is repealed.

15 (10) Public Law 100–55 (101 Stat. 371; U.S.C.

16 460l–6a note) is repealed.

17 SEC. 5301. CHALLENGE COST-SHARE AGREEMENTS.

18 The Secretary of the Interior is authorized to negotiate

19 and enter into challenge cost-share agreements with any

20 State or local government, public or private agency, organi21 zation, institution, corporation, individual, or other entity

22 for the purpose of sharing costs or services in carrying out

23 any authorized functions and responsibilities of the Sec24 retary with respect to any unit of the National Park System

25 (as defined in section 2(a) of the Act of August 8, 1953
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1 (16 U.S.C. 1c(a)), any affiliated area, or designated Na2 tional Scenic or Historic Trail.

3 SEC. 5302. COST RECOVERY FOR DAMAGE TO NATIONAL

4 PARK RESOURCES.

5 (a) DEFINITION OF PARK SYSTEM RESOURCE.—Sec6 tion 1 (d) of the National Park System Visitor Facilities

7 Fund Act (16 U.S.C. 19jj(d)) is amended to read as follows:

8 ‘‘(d) ‘Park system resource’ means any living or

9 nonliving resource that is located within the boundaries of

10 a unit of the National Park System, except for resources

11 owned by a non-Federal entity.’’.

12 (b) DEFINITION OF MARINE OR AQUATIC PARK SYS13 TEM RESOURCE.—Section 1 of the National Park System

14 Visitor Facilities Fund Act (16 U.S.C. 19jj) is amended by

15 adding at the end the following:

16 ‘‘(g) ‘Marine or aquatic park system resource’ means

17 any living or non-living resource that is located within or

18 is a living part of a marine or aquatic regimen within the

19 boundaries of a unit of the National Park System, except

20 for resources owned by a non-Federal entity.’’.

21 (c) LIABILITY IN REM.—Section 2(b) of the National

22 Park System Visitor Facilities Fund Act (16 U.S.C. 19jj–

23 1(b)) is amended by striking ‘‘any park’’ and inserting

24 ‘‘any marine or aquatic park’’.
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1 SEC. 5303. SPECIAL ACCOUNT.

2 A special account is hereby established in the Treasury

3 of the United States that shall be called the Park Renewal

4 Fund (hereinafter referred to in this subtitle as ‘‘the fund’’).

5 SEC. 5304. COVERING OF FEES INTO PARK RENEWAL FUND.

6 Notwithstanding section 4(i) of the Land and Water

7 Conservation Fund Act of 1965 (16 U.S.C. 460l–6a(i)), be8 ginning in fiscal year 1996, there shall be deposited into

9 the fund eighty percent of all revenues received from admis10 sion, recreation use, commercial tour use, and commercial/

11 non-recreational use fees collected by units of the National

12 Park System in excess of:

13 (1) $82,000,000 for fiscal year 1996;

14 (2) $85,000,000 for fiscal year 1997;

15 (3) $88,000,000 for fiscal year 1998;

16 (4) $91,000,000 for fiscal year 1999;

17 (5) $94,000,000 for fiscal year 2000;

18 (6) $97,000,000 for fiscal year 2001; and

19 (7) $100,000,000 for fiscal year 2002.

20 SEC. 5305. ALLOCATION AND USE OF FEES.

21 (a) ALLOCATION.—Beginning in fiscal year 1997, re22 ceipts in the fund from the previous fiscal year shall be

23 available to the Secretary without further appropriation

24 and shall be allocated as follows (except that all amounts

25 in excess of $20,000,000 in fiscal year 2003 and all
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1 amounts in fiscal year 2004 shall not be available for obli2 gation until fiscal year 2006):

3 (1) Seventy-five percent shall be allocated among

4 the units of the National Park System in the same

5 proportion as admission, recreation use, commercial

6 tour use and commercial/non-recreational use fees col7 lected from a specific unit bears to the total amount

8 of such fees collected from all units of the National

9 Park System for each fiscal year.

10 (2) Twenty-five percent shall be allocated among

11 the units of the National Park System on the basis

12 of need, as determined by the Secretary.

13 (b) USE.—Expenditures from the fund shall be used

14 solely for infrastructure and operational needs by units of

15 the National Park System. By January 1 of each year, the

16 Secretary shall provide to the Committee on Energy and

17 Natural Resources of the United States Senate and the

18 Committee on Resources of the House of Representatives a

19 list of proposed expenditures from the fund for each unit

20 for that fiscal year and a report detailing expenditures, by

21 unit, for the previous fiscal year.
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1 Subtitle E—Water Projects

2 SEC. 5400. AUTHORIZATION FOR PREPAYMENT OF CON3 STRUCTION CHARGES.

4 Subsection 213(a) of the Reclamation Reform Act of

5 1982 (96 Stat.1269, 43 U.S.C. 390mm(a)) is amended:

6 (a) By adding at the beginning:

7 ‘‘Notwithstanding any provision of Reclamation law or

8 limitation contained in any repayment or water service

9 contract, any person or district holding such a contract or

10 receiving water under such a contract with the United

11 States may prepay the construction costs referred to in this

12 section either through accelerated or lump sum payments.

13 For the purposes of such prepayment only, the project to

14 which such contract applies is declared to be complete and

15 the Secretary shall determine the repayment obligations as16 sociated with the construction costs of the project facilities

17 so that accelerated payments or a lump sum payment may

18 be made. The amount of any prepayment shall be calculated

19 by discounting the remaining payments due under a con20 tract in accordance with the guidelines set forth in Circular

21 A–129 issued by the Office of Management and Budget:

22 Provided, That the discount shall be adjusted by any

23 amounts necessary to compensate the Federal Government

24 for the direct or indirect loss of future tax revenues if the
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1 individual or district plans to use federally tax-exempt fi2 nancing for such prepayment.’’.

3 (b) By deleting ‘‘lands in a district’’ and inserting:

4 ‘‘lands in a district, or lands owned or leased by a person’’.

5 (c) By deleting ‘‘obligation of a district’’ and inserting:

6 ‘‘obligation of a district or a person’’.

7 (d) By deleting ‘‘enactment of this Act.’’ and inserting:

8 ‘‘enactment of this Act or as otherwise provided for in this

9 section. Any additional capital costs incurred after the date

10 of such prepayment shall be recoverable as a separate obli11 gation and shall not be considered to be a new or supple12 mental benefit for the purposes of this act nor cause the

13 full cost pricing limitation of this act or the ownership lim14 itations contained in any provision of Federal reclamation

15 law to apply to the lands to which such capital costs

16 apply.’’.

17 SEC. 5401. CONFORMING AMENDMENT.

18 Subsection 213(c) of the Reclamation Reform Act of

19 1982 (43 U.S.C. 390mm(c)) is repealed.

20 SEC. 5410. HETCH HETCHY DAM.

21 Section 7 of the Act of December 13, 1913 (38 Stat.

22 242), is amended—

23 (1) By striking ‘‘pay the sum of $30,000’’ and

24 all that follows in the first sentence and inserting

25 ‘‘pay an amount determined annually by the Sec-
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1 retary in accordance with the formula used by the

2 Federal Energy Regulatory Commission for applica3 tion to licenses of hydroelectric projects under the

4 Federal Power Act (16 U.S.C. 791 et seq.), provided

5 that, in no event shall such amount be less than

6 $597,000.00. Said amount to be paid on the first day

7 of July of each year.’’.

8 (2) By amending the second and third sentences

9 to read as follows: ‘‘These funds shall be placed in a

10 separate fund by the United States and, notwith11 standing any other provision of law, shall not be

12 available for obligation or expenditure until appro13 priated by Congress. The highest priority use of the

14 funds shall be for annual operation of Yosemite Na15 tional Park, with the remainder of any funds to be

16 used to fund operations of other national parks in the

17 State of California.’’.

18 SEC. 5420. COLLBRAN PROJECT.

19 (a) SHORT TITLE.—This section may be cited as the

20 ‘‘Collbran Project Unit Conveyance Act’’.

21 (b) DEFINITIONS.—For purposes of this section:

22 (1) DISTRICTS.—The term ‘‘Districts’’ means the

23 Ute Water Conservancy District and the Collbran

24 Conservancy District (including their successors and

25 assigns).
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1 (2) FEDERAL RECLAMATION LAWS.—The term

2 ‘‘Federal reclamation laws’’ means the Act of June

3 17, 1902, and Acts amendatory thereof or supple4 mentary thereto (32 Stat. 388, chapter 1093; 43

5 U.S.C. 371 et seq.) (including regulations adopted

6 pursuant to those Acts).

7 (3) PROJECT.—The term ‘‘Project’’ means the

8 Collbran Reclamation Project, as constructed and op9 erated under the Act of July 3, 1952 (66 Stat. 325,

10 chapter 565), including all property, equipment, and

11 assets of or relating to the Project that are owned by

12 the United States, including—

13 (A) Vega Dam and Reservoir (but not in14 cluding recreation facilities owned by the United

15 States or the State of Colorado);

16 (B) Leon-Park Dams and Feeder Canal;

17 (C) Southside Canal;

18 (D) East Fork Diversion Dam and Feeder

19 Canal;

20 (E) Bonham-Cottonwood Pipeline;

21 (F) Snowcat Shed and Diesel Storage;

22 (G) Upper Molina Penstock and Power

23 Plant;

24 (H) Lower Molina Penstock and Power

25 Plant;
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1 (I) the diversion structure in the tailrace of

2 the Lower Molina Power Plant;

3 (J) all substations and switchyards;

4 (K) a perpetual, non-exclusive easement for

5 the use of easements or rights-of-way owned by

6 the United States on or across non-Federal lands

7 which are necessary for access to Project facili8 ties;

9 (L) a perpetual, non-exclusive easement on

10 and across National Forest lands for access to

11 existing Project facilities and access to and the

12 operation, use repair, and replacement of the ex13 isting storage reservoirs on the Grand Mesa

14 which are operated as a part of the Project;

15 (M) title to lands reasonably necessary for

16 all Project facilities except for those described in

17 subparagraphs (3)(K) and (3)(L);

18 (N) all permits and contract rights;

19 (O) all equipment, parts inventories, and

20 tools;

21 (P) all additions, replacements, betterments,

22 and appurtenances to any of the above; and

23 (Q) a copy of all data, plans designs, re24 ports, records, or other materials, whether in
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1 writing or in any form of electronic storage re2 lating specifically to the Project.

3 (4) SECRETARY.—The term ‘‘Secretary’’ means

4 the Secretary of the Interior.

5 (c) CONVEYANCE OF THE COLLBRAN PROJECT.—

6 (1) IN GENERAL.—The Secretary shall convey to

7 the Districts all right, title, and interest of the United

8 States in and to the Project, as described in this sec9 tion, by quitclaim deed and bill of sale, without war10 ranties, during the last quarter of fiscal year 2000,

11 subject only to the requirements of this section: Pro12 vided, That such conveyance shall reserve to the Unit13 ed States all minerals, including hydrocarbons, and a

14 perpetual right of public access over, across, under,

15 and to the portions of the Project which on the date

16 of enactment of this Act were open to public use for

17 purposes such as grazing, mineral development and

18 logging: Provided further, That the United States

19 may allow for the continued public use and enjoy20 ment of such portions of the Project for recreational

21 activities and other public uses conducted as of the

22 date of enactment of this Act.

23 (2) PAYMENT.—

24 (A) IN GENERAL.—At the time of transfer,

25 the Districts shall pay to the United States
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1 $12,900,000 ($12,300,000 of which represents the

2 net present value of the outstanding repayment

3 obligations of the Districts), of which—

4 (i) $12,300,000 shall be deposited in

5 the general fund of the United States Treas6 ury; and

7 (ii) $600,000 shall be deposited in a

8 special account in the United States Treas9 ury and shall be available to the United

10 States Fish and Wildlife Service, region 6,

11 without further appropriation, for use in

12 funding Colorado operations and capital ex13 penditures associated with the Recovery Im14 plementation Program for Endangered Fish

15 Species in the Upper Colorado River Basin.

16 (B) SOURCE OF FUNDS.—Funds for the

17 payment to the extent of the amount specified in

18 the paragraph (1)(A) shall not be derived from

19 the issuance or sale, prior to the conveyance, of

20 State or local bonds the interest on which is ex21 empt from taxation under section 103 of the In22 ternal Revenue Code of 1986 (26 U.S.C. 103).

23 (3) OPERATION OF PROJECT.—

24 (A) IN GENERAL.—The Project shall be op25 erated and used by the Districts for a period of
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1 40 years after the date of enactment of this sec2 tion for the purposes for which the Project was

3 authorized under the Act of July 3, 1952 (66

4 Stat. 325, chapter 565).

5 (B) REQUIREMENTS.—During the 40-year

6 period described in paragraph (1)—

7 (i) the Districts shall annually submit

8 to the Secretary a plan for operation of the

9 Project, which plan shall—

10 (I) report on Project operations

11 for the previous year;

12 (II) provide a description of the

13 manner of Project operations antici14 pated for the forthcoming year; and

15 (III) certify that the Districts

16 have operated and will operate and

17 maintain the Project facilities in ac18 cordance with sound engineering prac19 tices; and

20 (ii) provide that, subject to subsection

21 (d), all electric power generated by oper22 ation of the Project shall be made available

23 to and be marketed by the Western Area

24 Power Administration (including its succes25 sors and assigns).
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1 (4) AGREEMENTS.—Conveyance of the Project

2 shall be subject to the agreements between the United

3 States and the State of Colorado dated August 22,

4 1994, and September 23, 1994, relating to the con5 struction and operation of recreational facilities at

6 Vega Reservoir, which agreements shall continue to be

7 performed by the parties thereto according to the

8 terms of the agreements.

9 (d) OPERATION.—

10 (1) CONFORMITY TO HISTORIC OPERATIONS.—

11 The power component and facilities of the Project

12 shall be operated in substantial conformity with the

13 historic operations of the power component and facili14 ties (including recent operations in a peaking mode).

15 (2) POWER MARKETING.—

16 (A) UNDER EXISTING AGREEMENTS.—The

17 Districts shall be bound by the agreements be18 tween the Bureau of Reclamation and the West19 ern Area Power Administration in existence on

20 the date of enactment of this section, which pro21 vide for the marketing of power generated by the

22 power component of the Project as part of the

23 output of the Salt Lake City Area Integrated

24 Projects under the Post 1989 Operating Criteria,

25 until those agreements expire or are terminated.
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1 (B) AFTER EXPIRATION OF EXISTING

2 AGREEMENT.—

3 (i) After the agreements described in

4 paragraph (1) expire or are terminated, the

5 Districts shall offer all power produced by

6 the power component of the Project to the

7 Western Area Power Administration or its

8 successors or assigns (‘‘Western’’), which, in

9 consultation with its affected preference cus10 tomers, shall have the first right to purchase

11 such power at the rates established in ac12 cordance with Subparagraph (ii) of this

13 paragraph. If Western declines to purchase

14 the power after consultation with its af15 fected preference customers, such power shall

16 then be offered at the same rates first to

17 Western’s preference customers located in

18 the Salt Lake City Area Integrated Projects

19 marketing area (‘‘SLCAIP preference cus20 tomers’’). Thereafter, such power may be

21 sold to any other party: Provided, however,

22 That no such sale may occur at rates less

23 than established in accordance with sub24 paragraph (ii) of this paragraph unless

25 such power is first offered at such lesser rate
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1 first to Western and then to its SLCAIP

2 preference customers.

3 (ii) The rate for power initially offered

4 to Western and its SLCAIP preference cus5 tomers under this paragraph shall not ex6 ceed that required to produce revenues suffi7 cient to provide for

8 (I) annual debt service and/or

9 recoupment of the cost of capital for

10 the amount specified in subsection

11 (c)(2) of this section, less the sum of

12 $220,000 (which is the net present

13 value of the outstanding repayment ob14 ligation of the Collbran Conservancy

15 District), and

16 (II) the cost of operation, mainte17 nance and replacement of the power

18 component of the Project.

19 (iii) Such costs and rate shall be deter20 mined in a manner consistent with the cur21 rent principles followed by the Secretary of

22 the Interior and by Western in its annual

23 power and repayment study.

24 (3) LICENSE.—The Districts are by this section

25 granted a license under the Federal Power Act (16
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1 U.S.C. 791a et seq.) for the operation of the Project

2 in accordance with the requirement of subsection

3 (c)(3) of this section, for a period of 40 years after

4 the date of conveyance of the Project, after which pe5 riod the license may be renewed in accordance with

6 applicable law.

7 (e) INAPPLICABILITY OF NEPA.—The conveyance of

8 the Project does not constitute a major Federal action with9 in the meaning of the National Environmental Policy Act

10 of 1969 (42 U.S.C. 4321 et seq.), including any regulations

11 issued under such Act.

12 (f) INAPPLICABILITY OF PRIOR AGREEMENTS AND OF

13 FEDERAL RECLAMATION LAWS.—On conveyance of the

14 Project to the Districts—

15 (1) the Repayment Contract dated May 27,

16 1957, as amended April 12, 1962, between the

17 Collbran Conservancy District and the United States,

18 and the Contract for use of Project facilities for Di19 version of Water dated January 11, 1962, as amended

20 November 10, 1977, between the Ute Water Conser21 vancy District and the United States, shall be termi22 nated and of no further force or effect; and

23 (2) the Project shall no longer be subject to or

24 governed by the Federal reclamation laws.
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1 (g) DISTRICTS’ LIABILITY.—The Districts shall be lia2 ble for all acts or omissions relating to the operation and

3 use of the Project that occur subsequent to the conveyance.

4 Subtitle F—Federal Oil and Gas

5 Royalties

6 SEC. 5500. SHORT TITLE.

7 This subtitle may be cited as the ‘‘Federal Oil and Gas

8 Royalty Simplification and Fairness Act of 1995’’.

9 SEC. 5501. DEFINITIONS.

10 Section 3 of the Federal Oil and Gas Royalty Manage11 ment Act of 1982 (30 U.S.C. 1701 et seq.) is amended by

12 striking ‘‘and’’ at the end of paragraph (15), by striking

13 the period at the end of paragraph (16) and inserting a

14 semicolon, and by adding at the end the following:

15 ‘‘(17) ‘adjustment’ means an amendment to a

16 previously filed report on an obligation, and any ad17 ditional payment or credit, if any, applicable thereto,

18 to rectify an underpayment or overpayment on a

19 lease;

20 ‘‘(18) ‘administrative proceeding’ means any

21 agency process in which a demand, decision or order

22 issued by the Secretary is subject to appeal or has

23 been appealed;
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1 ‘‘(19) ‘assessment’ means any fee or charge levied

2 or imposed by the Secretary or the United States

3 other than—

4 ‘‘(A) the principal amount of any royalty,

5 minimum royalty, rental, bonus, Net profit share

6 or proceed of sale;

7 ‘‘(B) any interest; or

8 ‘‘(C) any civil or criminal penalty;

9 ‘‘(20) ‘commence’ means—

10 ‘‘(A) with respect to a judicial proceeding,

11 the service of a complaint, petition, counter12 claim, crossclaim, or other pleading seeking af13 firmative relief or seeking credit or recoupment;

14 or

15 ‘‘(B) with respect to a demand, the receipt

16 by the Secretary or a lessee of the demand;

17 ‘‘(21) ‘credit’ means the application of an over18 payment (in whole or in part) against an obligation

19 which has become due to discharge, cancel or reduce

20 the obligation;

21 ‘‘(22) ‘demand’ means—

22 ‘‘(A) an order to pay issued by the Sec23 retary; or

24 ‘‘(B) a separate written request by a lessee

25 which asserts an obligation due the lessee, but
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1 does not mean any royalty or production report,

2 or any information contained therein, required

3 by the Secretary;

4 ‘‘(23) ‘obligation’ means—

5 ‘‘(A) any duty of the Secretary or the Unit6 ed States—

7 ‘‘(i) to take oil or gas royalty in kind;

8 or

9 ‘‘(ii) to pay, refund, offset, or credit

10 monies including but not limited to—

11 ‘‘(I) the principal amount of any

12 royalty, minimum royalty, rental,

13 bonus, net profit share or proceed of

14 sale; or

15 ‘‘(II) any interest;

16 ‘‘(B) any duty of a lessee—

17 ‘‘(i) to deliver oil or gas royalty in

18 kind; or

19 ‘‘(ii) to pay, offset or credit monies in20 cluding but not limited to—

21 ‘‘(I) the principal amount of any

22 royalty, minimum royalty, rental,

23 bonus, net profit share or proceed of

24 sale;

25 ‘‘(II) any interest;
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1 ‘‘(III) any penalty; or

2 ‘‘(IV) any assessment,

3 which arises from or relates to any lease administered

4 by the Secretary for, or any mineral leasing law re5 lated to, the exploration, production and development

6 of oil or gas on Federal lands or the Outer Continen7 tal Shelf;

8 ‘‘(24) ‘order to pay’ means a written order is9 sued by the Secretary or the United States which—

10 ‘‘(A) asserts a definite and quantified obli11 gation due the Secretary or the United States;

12 and

13 ‘‘(B) specifically identifies the obligation by

14 lease, production month and amount of such ob15 ligation ordered to be paid, as well as the reason

16 or reasons such obligation is claimed to be due,

17 but such term does not include any other com18 munication or action by or on behalf of the Sec19 retary or the United States;

20 ‘‘(25) ‘order to perform a restructured account21 ing’ means a written order issued by the Secretary

22 during a full and complete audit of a lessee to recal23 culate royalty due on an obligation based upon the

24 Secretary’s finding that the lessee has made identified

25 underpayments or overpayments which are dem-
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1 onstrated by the Secretary to be based upon repeated,

2 systemic reporting errors for a significant number of

3 leases for a significant number of reporting months

4 with the same type of error which constitutes a pat5 tern of violations and which are likely to result in ei6 ther a significant underpayment or overpayment. The

7 term ‘order to perform a restructured accounting’

8 shall not include any other communication or action

9 by or on behalf of the Secretary or the United States;

10 ‘‘(26) ‘overpayment’ means any payment by a

11 lessee in excess of an amount legally required to be

12 paid on an obligation and includes the portion of any

13 estimated payment for a production month that is in

14 excess of the royalties due for that month;

15 ‘‘(27) ‘payment’ means satisfaction, in whole or

16 in part, of an obligation due the Secretary or the

17 United States;

18 ‘‘(28) ‘penalty’ means a statutorily authorized

19 civil fine levied or imposed by the Secretary or the

20 United States for a violation of this Act, any mineral

21 leasing law, or a term or provision of a lease admin22 istered by the Secretary;

23 ‘‘(29) ‘refund’ means the return of an overpay24 ment by the Secretary or the United States by the

25 drawing of funds from the United States Treasury;
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1 ‘‘(30) ‘State concerned’ means, with respect to a

2 lease, a State which receives a portion of royalties

3 under this Act from such lease;

4 ‘‘(31) ‘underpayment’ means any payment or

5 nonpayment by a lessee that is less than the amount

6 legally required to be paid on an obligation; and

7 ‘‘(32) ‘United States’ means the United States

8 Government and any department, agency, or instru9 mentality thereof, and the several States, the District

10 of Columbia, Puerto Rico, and the territories and pos11 sessions of the United States.’’.

12 SEC. 5502. LIMITATION PERIODS.

13 (a) IN GENERAL.—The Federal Oil and Gas Royalty

14 Management Act of 1982 (30 U.S.C. 1701 et seq.) is amend15 ed by adding after section 114 the following new section:

16 ‘‘SEC. 115. LIMITATION PERIODS AND AGENCY ACTIONS.

17 ‘‘(a) IN GENERAL.—A judicial proceeding or demand

18 which arises from, or relates to an obligation, shall be com19 menced within six years from the date on which the obliga20 tion becomes due and if not so commenced shall be barred,

21 except as otherwise provided by this section.

22 ‘‘(b) OBLIGATION BECOMES DUE.—

23 ‘‘(1) IN GENERAL.—For purposes of this Act, an

24 obligation becomes due when the right to enforce the

25 obligation is fixed.
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1 ‘‘(2) ROYALTY OBLIGATIONS.—The right to en2 force the royalty obligation for a production month

3 for a lease is fixed for purposes of this Act on the last

4 day of the calendar month following the month in

5 which oil or gas is produced.

6 ‘‘(c) TOLLING LIMITATIONS PERIOD.—The running of

7 the limitation period under subsection (a) shall not be sus8 pended, tolled, extended, or enlarged for any obligation for

9 any reason by any action, including an action by the Sec10 retary or the United States, other than the following:

11 ‘‘(1) TOLLING AGREEMENT.—A written agree12 ment executed during the limitation period between

13 the Secretary and a lessee which tolls the limitation

14 period for the amount of time during which the agree15 ment is in effect.

16 ‘‘(2) SUBPOENA.—(A) The issuance of a sub17 poena in accordance with the provisions of section

18 107(c) shall toll the limitation period with respect to

19 the obligation which is the subject of a subpoena only

20 for the period beginning on the date the lessee receives

21 the subpoena and ending on the date on which—

22 ‘‘(i) the lessee has produced such subpoenaed

23 records for the subject obligation,

24 ‘‘(ii) the Secretary receives written notice

25 that the subpoenaed records for the subject obli-
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1 gation are not in existence or are not in the les2 see’s possession or control, or

3 ‘‘(iii) a court has determined in a final de4 cision that such records are not required to be

5 produced, whichever occurs first.

6 ‘‘(B) If a State has been delegated authority pur7 suant to section 205 and pursuant to said delegation

8 executes a cooperative agreement under section 202,

9 the Secretary shall issue a subpoena hereunder upon

10 the request of the highest ranking State official having

11 ultimate authority over the collection of royalties on

12 State owned lands.

13 ‘‘(3) FRAUD OR CONCEALMENT.—Any fraud or

14 concealment by a lessee in an attempt to defeat or

15 evade an obligation in which case the limitation pe16 riod shall be tolled for the period of such fraud or

17 such concealment.

18 ‘‘(4) TOLLING REQUEST.—A written tolling re19 quest from a lessee based upon the lessee’s representa20 tion that the lessee’s entitlement to an overpayment

21 has not been finally determined. The limitation pe22 riod shall be tolled pursuant to this paragraph from

23 the date the Secretary receives the tolling request until

24 the earlier of the end of the requested period or 12

25 months after the date the Secretary receives the tolling
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1 request, but is subject to successive 12-month renewals

2 by the lessee made prior to the expiration of the then

3 applicable 12-month period. The tolling request shall

4 be sufficient if it identifies—

5 ‘‘(A) the person who made the potential

6 overpayment;

7 ‘‘(B) the leases and production months in8 volved in the potential overpayment; and

9 ‘‘(C) the reasons the lessee believes that it

10 may later be entitled to a refund of the overpay11 ment.

12 ‘‘(5) ORDER TO PERFORM A RESTRUCTURED AC13 COUNTING.—

14 ‘‘(A) The issuance of an order to perform a

15 restructured accounting by the Secretary nec16 essary for an audit. The limitation period under

17 subsection (a) shall be tolled for the obligation

18 which is the subject of the order only for the time

19 period commencing on the date the lessee receives

20 such order until—

21 ‘‘(i) 120 days after the Secretary has

22 received written notice that the accounting

23 (or other requirement) has been performed,

24 or
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1 ‘‘(ii) the issuance of a final decision

2 that the lessee is not required to perform the

3 accounting, whichever is earlier.

4 ‘‘(B) The Secretary is not precluded during

5 a full and complete audit from issuing an order

6 to perform a restructured accounting by the Sec7 retary for a single lease upon a finding that the

8 lessee has made identified underpayments or

9 overpayments which are demonstrated to be

10 based upon repeated, systemic reporting errors

11 on that lease for a significant number of report12 ing months with the same type of error which

13 constitutes a pattern of violations and which are

14 likely to result in either a significant

15 underpayment or overpayment. The power of the

16 Secretary to issue an order to perform a restruc17 tured accounting may not be delegated below the

18 most senior career professional position having

19 responsibility for the royalty management pro20 gram, which position is currently designated as

21 the ‘Associate Director for Royalty Management’.

22 An order to perform a restructured accounting

23 shall—
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1 ‘‘(i) be issued within a reasonable pe2 riod of time from when the audit identifies

3 the systemic, reporting errors;

4 ‘‘(ii) specify the reasons and factual

5 bases for such order; and

6 ‘‘(iii) be specifically identified as an

7 ‘order to perform a restructured account8 ing’.

9 ‘‘(d) TERMINATION OF LIMITATIONS PERIOD.—The

10 limitations period shall be terminated in the event—

11 ‘‘(1) the Secretary has notified the lessee in writ12 ing that a time period is closed to further audit; or

13 ‘‘(2) the Secretary and a lessee have so agreed in

14 writing.

15 ‘‘(e) FINAL AGENCY ACTION.—

16 ‘‘(1) 3-YEAR PERIOD.—The Secretary shall issue

17 a final decision in any administrative proceeding, in18 cluding any administrative proceedings pending on

19 the date of enactment of the Federal Oil and Gas

20 Royalty Simplification and Fairness Act of 1995,

21 within three years from the date such proceeding was

22 initiated or three years from the date of such enact23 ment, whichever is later. The three-year period may

24 be extended by any period of time agreed upon in

25 writing by the Secretary and the lessee.
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1 ‘‘(2) EFFECT OF FAILURE TO ISSUE DECISION.—

2 ‘‘(A) IN GENERAL.—If no such decision has

3 been issued by the Secretary within the three4 year period referred to in paragraph (1)—

5 ‘‘(i) the Secretary shall be deemed to

6 have issued and granted a decision in favor

7 of the lessee or lessees as to any

8 nonmonetary obligation and any monetary

9 obligation the principal amount of which is

10 less than $2,500; and

11 ‘‘(ii) the Secretary shall be deemed to

12 have issued a final decision in favor of the

13 Secretary, which decision shall be deemed to

14 affirm those issues for which the agency ren15 dered a decision prior to the end of such pe16 riod, as to any monetary obligation the

17 principal amount of which is $2,500 or

18 more, and the lessee shall have a right to a

19 de novo judicial review of such deemed final

20 decision.

21 ‘‘(B) NO PRECEDENTIAL EFFECT ON OTHER

22 PROCEEDINGS.—Deemed decisions under sub23 paragraph (A) shall have no precedential effect

24 in any judicial or administrative proceeding or

25 for any other purpose.
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1 ‘‘(f) ADMINISTRATIVE SETTLEMENT.—During the

2 pendency of any administrative proceeding, the parties

3 shall hold at least one settlement consultation for the pur4 pose of discussing disputed matters between the parties. For

5 purposes of settlement, the Secretary may waive interest re6 quired and may allow offsetting of obligations among leases.

7 The Secretary and the State concerned shall seek to resolve

8 disputes with a lessee in as expeditious a manner as pos9 sible, through settlement negotiations and other alternative

10 dispute resolution processes methods. If any dispute involv11 ing an obligation due is not resolved by the end of the six12 year period beginning on the date the obligation became

13 due, the amount of interest otherwise payable with respect

14 to the obligation shall accrue after such six-year period at

15 the rate—

16 ‘‘(1) for purposes of section 111(h), reduced each

17 year thereafter by two additional percentage points

18 from the rate in effect under this subsection for the

19 previous year (but not less than zero); and

20 ‘‘(2) for purposes of section 111(a), reduced each

21 year thereafter by one additional percentage point

22 from the rate in effect under this subsection for the

23 previous year (but not less than zero).

24 ‘‘(g) LIMITATION ON CERTAIN ACTIONS BY THE UNIT25 ED STATES.—When an action on or enforcement of an obli-
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1 gation under the mineral leasing laws is barred under this

2 section the United States or an officer or agency thereof

3 may not take any other or further action regarding that

4 obligation, including (but not limited to) the issuance of

5 any order, request, demand or other communication seeking

6 any document, accounting, determination, calculation, re7 calculation, payment, principal, interest, assessment, or

8 penalty or the initiation, pursuit or completion of an audit

9 with respect to that obligation.

10 ‘‘(h) JUDICIAL REVIEW.—In the event a demand sub11 ject to this section is timely commenced, a judicial proceed12 ing challenging the final agency action with respect to such

13 demand shall be deemed timely so long as such judicial pro14 ceeding is commenced within 180 days from receipt of no15 tice by the lessee of the final agency action.

16 ‘‘(i) IMPLEMENTATION OF FINAL DECISION.—In the

17 event a judicial proceeding or demand subject to this section

18 is timely commenced and thereafter the limitation period

19 in this section lapses during the pendency of such proceed20 ing, any party to such proceeding shall not be barred from

21 taking such action as is required or necessary to implement

22 a final unappealable judicial or administrative decision,

23 including any action required or necessary to implement

24 such decision by the recovery or recoupment of an
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1 underpayment or overpayment by means of refund or cred2 it.

3 ‘‘(j) STAY OF PAYMENT OBLIGATION PENDING RE4 VIEW.—Any party ordered by the Secretary or the United

5 States to pay any obligation (other than an assessment)

6 shall be entitled to a stay of such payment without bond

7 or other surety instrument pending an administrative or

8 judicial proceeding if the party periodically demonstrates

9 to the satisfaction of the Secretary that such party is finan10 cially solvent or otherwise able to pay the obligation. In

11 the event the party is not able to so demonstrate, the Sec12 retary may require a bond or other surety instrument satis13 factory to cover the obligation. Any party ordered by the

14 Secretary to pay an assessment shall be entitled to a stay

15 without bond or other surety instrument.

16 ‘‘(k) INAPPLICABILITY OF THE OTHER STATUTES OF

17 LIMITATION.—The limitations set forth in sections 2401,

18 2415, 2416, and 2462 of title 28, United States Code, and

19 section 42 of the Mineral Leasing Act (30 U.S.C. 226–2)

20 shall not apply to any obligation to which this Act ap21 plies.’’.

22 (b) SUBPOENA.—Section 107 of the Federal Oil and

23 Gas Royalty Management Act of 1982 (30 U.S.C. 1717) is

24 amended by adding at the end the following:
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1 ‘‘(c) RULES REGARDING ISSUANCE OF SUBPOENA RE2 LATING TO REPORTING AND PAYMENT OF AN OBLIGATION

3 DUE.—

4 ‘‘(1) IN GENERAL.—A subpoena which requires a

5 lessee to produce records necessary to determine the

6 proper reporting and payment of an obligation due

7 the Secretary may be issued under this section only

8 by the Solicitor, an Assistant Secretary of the Inte9 rior, or an acting Assistant Secretary of the Interior

10 who is a schedule C employee (as defined by section

11 213.3301 of title 5, Code of Federal Regulations) and

12 may not be delegated.

13 ‘‘(2) PRIOR WRITTEN REQUEST REQUIRED.—A

14 subpoena described in paragraph (1) may only be is15 sued against a lessee during the limitation period

16 provided in section 115 and only after the Secretary

17 has in writing requested the records from the lessee re18 lated to the obligation which is the subject of the sub19 poena and has determined that—

20 ‘‘(A) the lessee has failed to respond within

21 a reasonable period of time to the Secretary’s

22 written request for such records necessary for an

23 audit, investigation or other inquiry made in ac24 cordance with the Secretary’s responsibilities

25 under this Act;
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1 ‘‘(B) the lessee has in writing denied the

2 Secretary’s written request to produce such

3 records in the lessee’s possession or control nec4 essary for an audit, investigation or other in5 quiry made in accordance with the Secretary’s

6 responsibilities under this Act; or

7 ‘‘(C) the lessee has unreasonably delayed in

8 producing records necessary for an audit, inves9 tigation or other inquiry made in accordance

10 with the Secretary’s responsibilities under this

11 Act after the Secretary’s written request.

12 ‘‘(3) REASONABLE PERIOD FOR COMPLIANCE

13 WITH WRITTEN REQUEST.—In seeking records, the

14 Secretary shall afford the lessee a reasonable period of

15 time after a written request by the Secretary in which

16 to provide such records prior to the issuance of any

17 subpoena.’’.

18 (c) CLERICAL AMENDMENT.—The table of contents in

19 section 1 of such Act (30 U.S.C. 1701) is amended by add20 ing after the item relating to section 114 the following new

21 item:

‘‘Sec. 115. Limitation periods and agency actions.’’.

22 SEC. 5503. ADJUSTMENT AND REFUNDS.

23 (a) IN GENERAL.—The Federal Oil and Gas Royalty

24 Management Act of 1982 (30 U.S.C. 1701 et seq.) is amend25 ed by adding after section 111 the following new section:
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1 ‘‘SEC. 111A. ADJUSTMENTS AND REFUNDS.

2 ‘‘(a) ADJUSTMENTS.—

3 ‘‘(1) If, during the adjustment period, a lessee

4 determines that an adjustment or refund request is

5 necessary to correct an underpayment or overpayment

6 of an obligation, the lessee shall make such adjustment

7 or request a refund within a reasonable period of time

8 and only during the adjustment period. Any such ad9 justment shall not require prior notice to or approval

10 of the Secretary.

11 ‘‘(2)(A) For any adjustment, the lessee shall cal12 culate and report the interest due attributable to such

13 adjustment at the same time the lessee adjusts the

14 principal amount of the subject obligation, except as

15 provided by subparagraph (B).

16 ‘‘(B) In the case of a lessee on whom the Sec17 retary determines that subparagraph (A) would im18 pose a hardship, the Secretary shall calculate the in19 terest due and notify the lessee within a reasonable

20 time of the amount of interest due, unless such lessee

21 elects to calculate and report interest in accordance

22 with subparagraph (A).

23 ‘‘(3) An adjustment or a request for a refund for

24 an obligation may be made after the adjustment pe25 riod only upon written notice to and approval by the

26 Secretary during an audit of the period which in-
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1 cludes the production month for which the adjustment

2 is being made. If an overpayment is identified during

3 an audit, then the Secretary shall allow a credit or

4 refund in the amount of the overpayment.

5 ‘‘(4) For purposes of this section, the adjustment

6 period for any obligation shall be the five-year period

7 following the date on which an obligation became due.

8 The adjustment period shall be suspended, tolled, ex9 tended, enlarged, or terminated by the same actions

10 as the limitation period in section 115.

11 ‘‘(b) REFUNDS.—

12 ‘‘(1) IN GENERAL.—A request for refund is suffi13 cient if it—

14 ‘‘(A) is made in writing to the Secretary

15 and, for purposes of section 115, is specifically

16 identified as a demand;

17 ‘‘(B) identifies the person entitled to such

18 refund;

19 ‘‘(C) provides the Secretary information

20 that reasonably enables the Secretary to identify

21 the overpayment for which such refund is sought;

22 and

23 ‘‘(D) provides the reasons why the payment

24 was an overpayment.
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1 ‘‘(2) PAYMENT BY SECRETARY OF THE TREAS2 URY.—The Secretary shall certify the amount of the

3 refund to be paid under paragraph (1) to the Sec4 retary of the Treasury who shall make such refund.

5 Such refund shall be paid from amounts received as

6 current receipts from sales, bonuses, royalties (includ7 ing interest charges collected under this section) and

8 rentals of the public lands and the Outer Continental

9 Shelf under the provisions of the Mineral Leasing Act

10 and the Outer Continental Shelf Lands Act, which are

11 not payable to a State or the Reclamation Fund. The

12 portion of any such refund attributable to any

13 amounts previously disbursed to a State, the Rec14 lamation Fund, or any recipient prescribed by law

15 shall be deducted from the next disbursements to that

16 recipient made under the applicable law. Such

17 amounts deducted from subsequent disbursements

18 shall be credited to miscellaneous receipts in the

19 Treasury.

20 ‘‘(3) PAYMENT PERIOD.—A refund under this

21 subsection shall be paid or denied (with an expla22 nation of the reasons for the denial) within 120 days

23 of the date on which the request for refund is received

24 by the Secretary. Such refund shall be subject to later
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1 audit by the Secretary and subject to the provisions

2 of this Act.

3 ‘‘(4) PROHIBITION AGAINST REDUCTION OF RE4 FUNDS OR CREDITS.—In no event shall the Secretary

5 directly or indirectly claim any amount or amounts

6 against, or reduce any refund or credit (or interest

7 accrued thereon) by the amount of any obligation the

8 enforcement of which is barred by section 115.’’.

9 (b) CLERICAL AMENDMENT.—The table of contents in

10 section 1 of Act (30 U.S.C. 1701) is amended by adding

11 after the item relating to section 111 the following new item:

‘‘Sec. 111A. Adjustments and refunds.’’.

12 SEC. 5504. REQUIRED RECORDKEEPING.

13 Section 103 of the Federal Oil and Gas Royalty Man14 agement Act of 1982 (30 U.S.C. 1713(b)) is amended by

15 adding at the end the following:

16 ‘‘(c) records required by the Secretary for the purpose

17 of determining compliance with any applicable mineral

18 leasing law, lease provision, regulation or order with respect

19 to oil and gas leases from Federal lands or the Outer Con20 tinental Shelf shall be maintained for the same period of

21 time during which a judicial proceeding or demand may

22 be commenced under section 115(a). If a judicial proceeding

23 or demand is timely commenced, the record holder shall

24 maintain such records until the final nonappealable deci25 sion in such judicial proceeding is made, or with respect
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1 to that demand is rendered, unless the Secretary authorizes

2 in writing an earlier release of the requirement to maintain

3 such records. Notwithstanding anything herein to the con4 trary, under no circumstance shall a record holder be re5 quired to maintain or produce any record relating to an

6 obligation for any time period which is barred by the appli7 cable limitation in section 115.’’.

8 SEC. 5505. ROYALTY INTEREST, PENALTIES, AND PAY9 MENTS.

10 (a) PERIOD.—Section 111(f) of the Federal Oil and

11 Gas Royalty Management Act of 1982 (30 U.S.C. 1721(f))

12 is amended to read as follows:

13 ‘‘(f) The Secretary may waive or forego such interest

14 in whole or in part. Interest shall be charged under this

15 section only for the number of days a payment is late.’’.

16 (b) LESSEE INTEREST.—Section 111 of the Federal

17 Oil and Gas Royalty Management Act of 1982 (30 U.S.C.

18 1721) is amended by adding after subsection (g) the follow19 ing:

20 ‘‘(h) Interest shall be allowed and the Secretary shall

21 pay or credit such interest on any overpayment, with such

22 interest to accrue from the date such overpayment was

23 made, at the rate applicable under section 6621(a)(2) of the

24 Internal Revenue Code of 1986. Interest which has accrued

25 on any overpayment may be applied to reduce an
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1 underpayment. This subsection applies to overpayments

2 made later than six months after the date of enactment of

3 this subsection or September 1, 1996, whichever is later.

4 Such interest shall be paid from amounts received as cur5 rent receipts from sales, bonuses, royalties (including inter6 est charges collected under this section) and rentals of the

7 public lands and the Outer Continental Shelf under the pro8 visions of the Mineral Leasing Act, and the Outer Continen9 tal Shelf Lands Act, which are not payable to a State or

10 the Reclamation Fund. The portion of any such interest

11 payment attributable to any amounts previously disbursed

12 to a State, the Reclamation Fund, or any other recipient

13 designated by law shall be deducted from the next disburse14 ments to that recipient made under the applicable law.

15 Such amounts deducted from subsequent disbursements

16 shall be credited to miscellaneous receipts in the Treasury.’’.

17 (c) LIMITATION ON INTEREST.—Section 111 of the

18 Federal Oil and Gas Royalty Management Act, as amended

19 by subsection (b) of this Act, is further amended by adding

20 at the end the following:

21 ‘‘(i) Upon a determination by the Secretary that an

22 excessive overpayment (based upon all obligations of a lessee

23 for a given reporting month) was made for the sole purpose

24 of receiving interest, interest shall not be paid on the exces25 sive amount of such overpayment. For purposes of this Act,
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1 an ‘excessive overpayment’ shall be the amount that any

2 overpayment a lessee pays for a given reporting month (ex3 cluding payments for demands for obligations as a result

4 of judicial or administrative proceedings for settlement

5 agreements and for other similar payments) for the aggre6 gate of all of its Federal leases exceeds 25 percent of the

7 total royalties paid that month for those leases.’’.

8 (d) ESTIMATED PAYMENT.—Section 111 of the Federal

9 Oil and Gas Royalty Management Act, as amended by sub10 sections (b) and (c) of this Act, is further amended by add11 ing at the end the following:

12 ‘‘(j) A lessee may make a payment for the approximate

13 amount of royalties (hereinafter in this subsection ‘‘esti14 mated payment’) that would otherwise be due to the Sec15 retary for such lease to avoid underpayment or nonpayment

16 interest charges. When an estimated payment is made, ac17 tual royalties become due at the end of the month following

18 the period covered by the estimated payment. If the lessee

19 makes a payment for such actual royalties, the lessee may

20 apply the estimated payment to future royalties. Any esti21 mated payment may be adjusted, recouped, or reinstated

22 at any time by the lessee.’’.

23 (e) VOLUME ALLOCATION OF OIL AND GAS PRODUC24 TION.—Section 111 of the Federal Oil and Gas Royalty

25 Management Act (30 U.S.C. 1721), as amended by sub-
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1 sections (b) through (d) of this Act, is amended by adding

2 at the end the following:

3 ‘‘(k)(1) Except as otherwise provided by this sub4 section—

5 ‘‘(A) a lessee of a lease in a unit or

6 communitization agreement which contains only Fed7 eral leases with the same royalty rate and funds dis8 tribution must report and pay royalties on oil and

9 gas production for each production month based on

10 the actual volume of production sold by or on behalf

11 of that lessee;

12 ‘‘(B) a lessee of a lease in any other unit or

13 communitization agreement must report and pay roy14 alties on oil and gas production for each production

15 month based on the volume of oil and gas produced

16 from such agreement and allocated to the lease in ac17 cordance with the terms of the agreement; and

18 ‘‘(C) a lessee of a lease that is not contained in

19 a unit or communitization agreement must report

20 and pay royalties on oil and gas production for each

21 production month based on the actual volume of pro22 duction sold by or on behalf of that lessee.

23 ‘‘(2) This subsection applies only to requirements for

24 reporting and paying royalties. Nothing in this subsection

25 is intended to alter a lessee’s liability for royalties on oil
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1 or gas production based on the share of production allocated

2 to the lease in accordance with the terms of the lease, a

3 unit or communitization agreement, or any other agree4 ment.

5 ‘‘(3) For any unit or communitization agreement, if

6 all lessees contractually agree to an alternative method of

7 royalty reporting and payment, the lessees may submit such

8 alternative method to the Secretary for approval and make

9 payments in accordance with such approved alternative

10 method so long as such alternative method does not reduce

11 the amount of the royalty obligation.

12 ‘‘(4) The Secretary shall grant an exception from the

13 reporting and payment requirements for marginal prop14 erties by allowing for any calendar year or portion thereof

15 royalties to be paid each month based on the volume of pro16 duction sold. Interest shall not accrue on the difference for

17 the entire calendar year or portion thereof between the

18 amount of oil and gas actually sold and the share of produc19 tion allocated to the lease until the beginning of the month

20 following calendar year or portion thereof. Any additional

21 royalties due or overpaid royalties and associated interest

22 shall be paid, refunded, or credited within six months after

23 the end of each calendar year in which royalties are paid

24 based on volumes of production sold. For the purpose of this

25 subsection, the term ‘‘marginal property’ means a lease that
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1 produces on average the combined equivalent of less than

2 15 barrels of oil per day or 90 thousand cubic feet of gas

3 per day, or a combination thereof, determined by dividing

4 the average daily production of domestic crude oil and do5 mestic natural gas from producing wells on such lease by

6 the number of such wells, unless the Secretary, together with

7 the State concerned, determines that an amount which is

8 a nonsubstantive variation thereof is more appropriate.

9 ‘‘(5) Not later than two years after the date of the en10 actment of this subsection, the Secretary shall issue any ap11 propriate demand for all outstanding royalty payment dis12 putes regarding who is required to report and pay royalties

13 on production from units and communitization agreements

14 outstanding on the date of the enactment of this subsection,

15 and collect royalty amounts owed on such production.’’.

16 (f) PRODUCTION ALLOCATION.—Section 111 of the

17 Federal Oil and Gas Royalty Management Act (30 U.S.C.

18 1721), as amended by subsections (b) through (e) of this

19 Act, is further amended by adding at the end the following:

20 ‘‘(l) The Secretary shall issue all determinations of al21 locations of production for units and communitization

22 agreements within 120 days of a request for determination.

23 If the Secretary fails to issue a determination within such

24 120-day period, the Secretary shall waive interest due on

25 obligations subject to the determination until the end of the
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1 month following the month in which the determination is

2 made.’’.

3 SEC. 5506. LIMITATION ON ASSESSMENTS.

4 Section 111 of the Federal Oil and Gas Royalty Man5 agement Act of 1982 (30 U.S.C. 1721), as amended by sec6 tion 5505 of this Act, is further amended by adding at the

7 end the following:

8 ‘‘(l)(1) After the date of enactment of this subsection,

9 the Secretary shall not impose any assessment for any late

10 payment or underpayment. After the date of enactment of

11 this subsection, the Secretary may impose an assessment

12 only for erroneous reports submitted by lessees subject to

13 the limitations of paragraph (2). Nothing in this section

14 shall prohibit the Secretary from imposing penalties or in15 terest under other sections of this Act for late payments or

16 underpayments.

17 ‘‘(2) No assessment for erroneous reports shall be im18 posed for 18 months following the date of enactment of this

19 subsection, or until the Secretary issues a final rule which

20 provides for imposition of an assessment only on a lessee

21 who chronically submits erroneous reports and which estab22 lishes what constitutes chronic errors for a lessee, whichever

23 is later. However, if the Secretary determines during that

24 18-month period that the reporting error rate for all report25 ers for all Federal leases has increased by one-third for three
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1 consecutive report months for either production reporting

2 or royalty reporting over the 12 months preceding the date

3 of enactment of this subsection, the Secretary may impose

4 an assessment for erroneous reports only for the increased

5 category of report under regulations in effect on the date

6 of enactment of this subsection.’’.

7 SEC. 5507. ALTERNATIVES FOR MARGINAL PROPERTIES.

8 (a) IN GENERAL.—The Federal Oil and Gas Royalty

9 Management Act of 1982 (30 U.S.C. 1701 et seq.), as

10 amended by section 5502 of this Act, is further amended

11 by adding at the end the following:

12 ‘‘SEC. 116. ALTERNATIVES FOR MARGINAL PROPERTIES.

13 ‘‘(a) SELLING REVENUE STREAM.—

14 ‘‘(1) IN GENERAL.—Notwithstanding the provi15 sions of any lease to the contrary, upon request of the

16 lessee and a State under section 205(g), the Secretary

17 shall authorize a lessee for a marginal property and

18 for a lease, the administration of which is not cost19 effective for the Secretary to administer, to make a

20 prepayment in lieu of royalty payments under the

21 lease for the remainder of the lease term. For the pur22 poses of this section, the term ‘marginal property’ has

23 the same meaning given such term in section

24 111(k)(4), unless the Secretary, together with each

25 State in which such marginal production occurs, de-
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1 termines otherwise to better achieve the purpose of

2 this section.

3 ‘‘(2) MARGINAL PROPERTIES.—For marginal

4 properties, prepayments under paragraph (1) shall

5 begin—

6 ‘‘(A) in the case of those properties produc7 ing on average $500 or less per month in total

8 royalties to the United States, two years after the

9 date of the enactment of this section;

10 ‘‘(B) in the case of those properties produc11 ing on average more than $500 but $1,000 or

12 less per month in total royalties to the United

13 States, three years after the date of the enact14 ment of this section;

15 ‘‘(C) in the case of those properties produc16 ing on average more than $1,000 but $1,500 or

17 less per month in total royalties to the United

18 States, four years after the date of the enactment

19 of this section; and

20 ‘‘(D) in the case of those properties not de21 scribed in subparagraphs (A) through (C), five

22 years after the date of the enactment of this sec23 tion.

24 ‘‘(3) ADMINISTRATION NOT COST-EFFECTIVE.—

25 For a lease, the administration of which is not cost-
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1 effective for the Secretary to administer, prepayments

2 under paragraph (1) shall begin on the date of the en3 actment of this section.

4 ‘‘(4) SATISFACTION OF ROYALTY OBLIGATION.—A

5 lessee who makes a prepayment under this section

6 shall have satisfied in full its obligation to pay roy7 alty on production from the lease or a portion of a

8 lease and shall not be required to submit any royalty

9 reports to the Secretary. The prepayment shall be

10 shared by the Secretary with any State or other recip11 ient to the same extent as any royalty payment for

12 such lease.

13 ‘‘(5) VALUATION.—The prepayment authorized

14 under this section shall only occur if the Secretary,

15 the State concerned, and the lessee determine that

16 such prepayment is based on the present value of the

17 projected remaining royalties from the production

18 from the lease, based on appropriate nominal dis19 count rate for a comparable term, as provided in Of20 fice of Management and Budget Circular A–94.

21 ‘‘(b) ALTERNATIVE ACCOUNTING AND ALTERNATIVE

22 ACCOUNTING AND AUDITING REQUIREMENTS.—

23 ‘‘(1) IN GENERAL.—Within one year after the

24 date of the enactment of this section, for the marginal

25 properties referenced in subsection (a)(1), the Sec-
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1 retary shall provide accounting, reporting, and audit2 ing relief that will encourage lessees to continue to

3 produce and develop such properties: Provided, That

4 such relief will only be available to lessees in a State

5 that concurs.

6 ‘‘(2) PAYMENT DATE.—For leases subject to this

7 section, the Secretary may allow royalties to be paid

8 later than the time specified in the lease.’’.

9 (b) CLERICAL AMENDMENT.—The table of contents in

10 section 1 of the Federal Oil and Gas Royalty Management

11 Act (30 U.S.C. 1701) is amended by adding after the item

12 relating to section 115 the following new item:

‘‘Sec. 116. Alternatives for marginal properties.’’.

13 SEC. 5508. NOTICE REQUIREMENT.

14 Section 23(a)(2) of the Outer Continental Shelf Lands

15 Act (43 U.S.C. 1349(a)(2)) is amended to read as follows:

16 ‘‘(2) Except as provided in paragraph (3) of this

17 subsection, no action may be commenced under sub18 section (a)(1) of this section if the Attorney General

19 has commenced and is diligently prosecuting a civil

20 action in a court of the United States with respect to

21 such matter, but in any such action in a court of the

22 United States any person having a legal interest

23 which is or may be adversely affected may intervene

24 as a matter of right.’’.
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1 SEC. 5509. REPEALS.

2 (a) FOGRMA.—Section 307 of the Federal Oil and

3 Gas Royalty Management Act of 1982 (30 U.S.C. 1755),

4 is repealed. Section 1 of such Act (relating to the table of

5 contents) is amended by striking out the item relating to

6 section 307.

7 (b) OCSLA.—Effective on the date of the enactment

8 of this Act, section 10 of the Outer Continental Shelf Lands

9 Act (43 U.S.C. 1339) is repealed.

10 SEC. 5510. PERFORMANCE STANDARD.

11 Section 109 of the Federal Oil and Gas Royalty Man12 agement Act of 1982 (30 U.S.C. 1719) is amended in sub13 sections (c) and (d), by striking ‘‘knowingly or willfully’’

14 and inserting ‘‘by willful misconduct or gross negligence’’

15 each place it appears.

16 SEC. 5511. INDIAN LANDS.

17 The amendments made by this subtitle shall not apply

18 with respect to Indian lands, and the provisions of the Fed19 eral Oil and Gas Royalty Management Act of 1982 as in

20 effect on the day before the date of enactment of this Act

21 shall continue to apply after such date with respect to In22 dian lands. The provisions of the Federal Oil and Gas Roy23 alty Management Act of 1982, as amended by this subtitle,

24 shall apply as of the date of enactment with respect to Fed25 eral lands and the Outer Continental Shelf.
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1 SEC. 5512. PRIVATE LANDS.

2 This subtitle shall not apply to any privately owned

3 minerals.

4 SEC. 5513. EFFECTIVE DATE.

5 Except as provided by section 115(e), section 111(h),

6 section 111(k)(5), and section 116 of the Federal Oil and

7 Gas Royalty Management Act of 1982 (as added by this

8 subtitle), this subtitle, and the amendments made by this

9 subtitle, shall apply with respect to the production of oil

10 and gas after the first day of the month following the date

11 of the enactment of this Act.

12 Subtitle G—Department of Energy

13 SEC. 5600. SALE OF DOE ASSETS.

14 (a) IN GENERAL.—

15 (1) In order to maximize the use of Department

16 of Energy assets and to reduce overhead and other

17 costs related to asset management at the Department’s

18 facilities and laboratories, the Secretary of Energy

19 shall conduct an asset management and disposition

20 program that will result in no less than $225 million

21 in receipts and savings by October 1, 2000.

22 (2) The program shall include an inventory of

23 assets in the care of the Department and its contrac24 tors; the recovery, reuse, and stewardship of assets;

25 and disposition of a minimum of 1,139,000,000

26 pounds of fuel, 136,000 tons of chemicals and indus-
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1 trial gases, 557,000 tons of scrap metal, 14,000 radi2 ation sources, 17,000 pieces of major equipment,

3 11,000 pounds of precious metals (not including the

4 Research Materials Collection), and 91,000,000

5 pounds of base metals.

6 (b) EXEMPTIONS.—The disposition of assets under this

7 section is not subject to sections 202 and 203 of the Federal

8 Property and Administrative Services Act of 1949 (40

9 U.S.C. secs. 483 and 484) or section 13 of the Surplus Prop10 erty Act of 1944 (50 U.S.C. App. sec. 1622). In order to

11 avoid market disruptions, the Secretary shall consult with

12 appropriate executive agencies with respect to dispositions

13 under this section.

14 (c) DISPOSITION OF PROCEEDS.—After deduction of

15 administrative costs of disposition under this section not

16 to exceed $7 million per year, the remainder of the proceeds

17 from dispositions under this section shall be returned to the

18 Treasury as miscellaneous receipts. There shall be estab19 lished a new receipt account in the Treasury for proceeds

20 of asset sales under this section.

21 SEC. 5651. WEEKS ISLAND.

22 Notwithstanding section 161 of the Energy Policy and

23 Conservation Act, the Secretary of Energy shall draw down

24 and sell 32 million barrels of oil contained in the Weeks

25 Island Strategic Petroleum Reserve Facility.
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1 SEC. 5652. LEASE OF EXCESS SPRO CAPACITY.

2 The Energy Policy and Conservation Act (42 U.S.C.

3 6201 to 6422) is amended by adding the following new sec4 tion after section 167:

5 ‘‘SEC. 168. USE OF UNDERUTILIZED FACILITIES.

6 ‘‘(a) Notwithstanding any other provision of this title,

7 the Secretary, by lease or otherwise, for any term and under

8 such other conditions as the Secretary considers necessary

9 or appropriate, may store in underutilized Strategic Petro10 leum Reserve facilities petroleum product owned by a for11 eign government or its representative.

12 ‘‘(b) Petroleum product stored under this section is not

13 part of the Reserve and may be exported from the United

14 States.’’.

15 ‘‘(c) Beginning in fiscal year 2001 and in each fiscal

16 year thereafter, except for fiscal years 2003 and 2004, 50

17 percent of the funds resulting from the leasing of Strategic

18 Petroleum Reserve facilities authorized by subsection (a)

19 shall be available to the Secretary of Energy without further

20 appropriation for the purchase of oil for the Strategic Pe21 troleum Reserve.’’.

22 Subtitle H—Mining

23 SEC. 5700. SHORT TITLE.

24 This subtitle may be cited as ‘‘The Mining Law Reve25 nue Act of 1995’’.
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1 SEC. 5701. DEFINITIONS.

2 When used in this subtitle:

3 (1) ‘‘Assessment year’’ means the annual period

4 commencing at 12 o’clock noon on the 1st day of Sep5 tember and ending at 12 o’clock noon on the 1st day

6 of September of the following year.

7 (2) ‘‘Federal lands’’ means lands and interests in

8 lands owned by the United States that are open to

9 mineral location, or that were open to mineral loca10 tion when a mining claim or site was located and

11 which have not been patented under the general min12 ing laws.

13 (3) ‘‘General mining laws’’ means those Acts

14 which generally comprise chapters 2, 11, 12, 12A, 15,

15 and 16, and sections 161 and 162, of Title 30 of the

16 United States Code, all Acts heretofore enacted which

17 are amendatory of or supplementary to any of the

18 foregoing Acts, and the judicial and administrative

19 decisions interpreting such Acts.

20 (4) ‘‘Locatable minerals’’ means those minerals

21 owned by the United States and subject to location

22 and disposition under the general mining laws on or

23 after the effective date of this Subtitle, but not includ24 ing any mineral held in trust by the United States

25 for any Indian or Indian tribe, as defined in section

26 2 of the Indian Mineral Development Act of 1982 (25
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1 U.S.C. 2101), or any mineral owned by any Indian

2 or Indian tribe, as defined in that section, that is

3 subject to a restriction against alienation imposed by

4 the United States, or any mineral owned by any in5 corporated Native group, village corporation, or re6 gional corporation and acquired by the group or cor7 poration under the provisions of the Alaska Native

8 Claims Settlement Act (43 U.S.C. 1601 et seq.).

9 (5) ‘‘Mineral activities’’ means any activity on

10 Federal lands related to, or incidental to, exploration

11 for or development, mining, production, beneficiation,

12 or processing of any locatable mineral, or reclamation

13 of the impacts of such activities.

14 (6) ‘‘Mining claim or site’’, except where pro15 vided otherwise, means a lode mining claim, placer

16 mining claim, mill site or tunnel site.

17 (7) ‘‘Operator’’ means any person conducting

18 mineral activities subject to this Subtitle.

19 (8) ‘‘Person’’ means an individual, Indian tribe,

20 partnership, association, society, joint venture, joint

21 stock company, firm, company, limited liability com22 pany, corporation, cooperative or other organization,

23 and any instrumentality of State or local govern24 ment, including any publicly owned utility or pub25 licly owned corporation of State or local government.
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1 (9) ‘‘Processing and treatment cost’’ means any

2 activity following mining including but not limited

3 to, crushing, milling, leaching, flotation, grinding,

4 solvent extraction, electrolytic deposition, roasting,

5 calcining thermal or electric smelting, refining, treat6 ment effecting a chemical change, or product fabrica7 tion. Direct and indirect cost such as maintenance,

8 depreciation, environmental, labor and consumable

9 cost associated with these activities shall be included

10 in this definition.

11 (10) ‘‘Secretary’’ means the Secretary of the In12 terior.

13 SEC. 5702. CLAIM MAINTENANCE REQUIREMENTS.

14 (a) MAINTENANCE FEE.—After the date of enactment

15 of this Subtitle, the owner of each unpatented mining claim

16 or site located pursuant to the general mining laws, whether

17 located before or after the enactment of this Subtitle, shall

18 pay in advance to the Secretary annually on or before Sep19 tember 1, and until a patent has been issued therefor, a

20 maintenance fee of $100 per mining claim or site. The

21 owner of each unpatented mining claim or site located after

22 the date of enactment of this Subtitle pursuant to the gen23 eral mining laws shall pay to the Secretary, at the time

24 the copy of the notice or certificate of location is filed with

25 the Bureau of Land Management pursuant to section 314(b)
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1 of the Federal Land Policy and Management Act of 1976

2 (43 U.S.C. 1744(b)), in addition to the location fee required

3 under subsection (c) of this section, an initial maintenance

4 fee of $100 per mining claim or site for the assessment year

5 which includes the date of location of such mining claim

6 or site. If a mining claim or site is located within 90 days

7 before September 1 and the copy of the notice or certificate

8 of location is timely filed with the Bureau of Land Manage9 ment under subsection 314(b) of the Federal Land Policy

10 and Management Act of 1976 after September 1, the annual

11 maintenance fee payable under the first sentence of this sub12 section shall be paid at the time such notice or certificate

13 of location is filed, in addition to the location fee and the

14 initial $100 maintenance fee. No maintenance fee shall be

15 required if the fee is waived or the owner of the mining

16 claim or site is exempt as provided in section 5703 of this

17 Subtitle.

18 (b) MAINTENANCE FEE STATEMENT.—Each payment

19 under subsection (a) of this section shall be accompanied

20 by a statement which reasonably identifies the mining

21 claim or site for which the maintenance fee is being paid.

22 Such statement may include the name of the mining claim

23 or site, the serial number assigned by the Secretary to such

24 mining claim or site, the description of the book and page

25 in which the notice or certificate of location for such mining
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1 claim or site is recorded under State law, any combination

2 of the foregoing, or any other information that reasonably

3 identifies the mining claim or site for which the mainte4 nance fee is being paid. The statement required under this

5 subsection shall be in lieu of any annual filing requirements

6 for mining claims or sites, under any other Federal law,

7 but shall not supersede any such filing requirement under

8 applicable State law.

9 (c) LOCATION FEE.—The owner of each unpatented

10 mining claim or site located on or after the date of enact11 ment of this Subtitle pursuant to the general mining laws

12 shall pay to the Secretary, at the time the notice or certifi13 cate of location is filed with the Bureau of Land Manage14 ment pursuant to subsection 314(b) of the Federal Land

15 Policy and Management Act of 1976 (43 U.S.C. 1744(b)),

16 a location fee of $25.00 per claim.

17 (d) CREDIT AGAINST ROYALTY.—The annual claim

18 maintenance fee paid for any unpatented mining claim or

19 site on or before September 1 of any year shall be credited

20 against the amount of royalty required to be paid under

21 Section 5705 for such mining claim or site during the fol22 lowing assessment year.

23 (e) FAILURE TO COMPLY.—The failure of the owner

24 of the mining claim or site to pay the claim maintenance

25 fee or location fee for a mining claim or site on or before
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1 the date such payment is due under subsection (a) or sub2 section (c) of this section shall constitute forfeiture of the

3 mining claim or site and such mining claim or site shall

4 be null and void, effective as of the day after the date such

5 payment is due: Provided, however, That, if such mainte6 nance fee or location fee is paid or tendered on or before

7 the 30th day after such payment was due under subsection

8 (a) or subsection (c) of this section, such mining claim or

9 site shall not be forfeited or null or void, and such mainte10 nance fee or location fee shall be deemed timely paid.

11 (f) REPEAL OF OMNIBUS BUDGET RECONCILIATION

12 ACT FEE REQUIREMENTS.—Sections 10101 through 10106

13 of the Omnibus Budget Reconciliation Act of 1993 (30

14 U.S.C. 28f through 28k) are hereby repealed.

15 (g) AMENDMENT OF FLPMA FILING REQUIRE16 MENTS.—Section 314 (a) of the Federal Land Policy and

17 Management Act of 1976 (43 U.S.C. 1744 (a)) is hereby

18 repealed.

19 SEC. 5703. WAIVER AND EXEMPTION.

20 (a) WAIVER OF FEE.—The maintenance fee provided

21 for in subsection 5702(a) shall be waived for the owner of

22 a mining claim or site who certifies in writing to the Sec23 retary, on or before the date the payment is due, that, as

24 of the date such payment is due, such owner and all related

25 persons own not more than twenty-five unpatented mining
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1 claims or sites. Any owner of a mining claim or site that

2 is not required to pay a maintenance fee under this sub3 section shall continue to be subject to the assessment work

4 requirements of the general mining laws or of any other

5 State or Federal law, subject to any suspension or deferment

6 of annual assessment work provided by law, for the assess7 ment year following the filing of the certification required

8 by this subsection.

9 (b) RELATED PERSONS.—As used in subsection (a),

10 the term ‘‘related persons’’ includes—

11 (1) the spouse and dependent children (as de12 fined in section 152 of the Internal Revenue Code of

13 1986), of the owner of the mining claim or site; and

14 (2) a person controlled by, controlling, or under

15 common control with the owner of the mining claim

16 or site.

17 (c) EXEMPTION.—The owner of any mining claim or

18 site who certifies in writing to the Secretary on or before

19 the first day of any assessment year that access to such min20 ing claim or site was denied or impeded during the prior

21 assessment year by the action or inaction of any local,

22 State, or Federal Governmental officer, agency, or court, or

23 by any Indian tribal authority, shall be exempt from the

24 maintenance fee requirement of subsection (a) of section
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1 5702 for the assessment year following the filing of the cer2 tification.

3 SEC. 5704. PATENTS.

4 (a) IN GENERAL.—Except as provided in subsection

5 (c), any patent issued by the United States under the gen6 eral mining laws after the date of enactment of this Subtitle

7 shall be issued only—

8 (1) upon payment by the owner of the claim of

9 the fair market value for the interest in the land

10 owned by the United States exclusive of and without

11 regard to the mineral deposits in the land or the use

12 of the land for mineral activities; and

13 (2) subject to reservation by the United States of

14 the royalty provided in section 5705.

15 (b) RIGHT OF REENTRY.—

16 (1) Except as provided in subsection 5704(c),

17 and notwithstanding any other provision of law, a

18 patent issued pursuant to this section shall be subject

19 to a right of reentry by the United States if the pat20 ented estate is used by the patentee for any purpose

21 other than for conducting mineral activities in good

22 faith and such unauthorized use is not discontinued

23 as provided in this subsection.

24 (2) If the surface of the patented estate is used

25 by the patentee, or any subsequent owners, for any
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1 purpose other than for conducting mineral activities

2 in good faith, the Secretary shall serve on all owners

3 of interests in such patented estate, in the manner

4 prescribed for service of a summons and complaint

5 under the Federal Rules of Civil Procedure, notice

6 specifying such unauthorized use and providing not

7 more than 90 days in which such unauthorized use

8 must be terminated. The giving of such notice shall

9 constitute final agency action appealable by any

10 owner of an interest in such patented estate. The Sec11 retary may exercise the right of reentry as provided

12 in paragraph (3) of this subsection if such unauthor13 ized use has not been terminated in the time provided

14 in this paragraph, and only after all appeal rights

15 have expired and any appeals of such notice have

16 been finally determined.

17 (3) The Secretary may exercise the right of the

18 United States to reenter such patented estate by filing

19 a declaration of reentry in the office of the Bureau of

20 Land Management designated by the Secretary and

21 recording such declaration where the notice or certifi22 cate of location for the patented claim or site is re23 corded under State law. Upon the filing and record24 ing of such declaration, all right, title and interest in

25 such patented estate shall revert to the United States.
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1 Lands and interests in lands for which the United

2 States exercises its right of reentry under this section

3 shall remain open to the location of mining claims

4 and mill sites, unless withdrawn under other applica5 ble law.

6 (c) PATENT TRANSITION.—Notwithstanding any other

7 provision of law, the requirements of this subtitle (except

8 the payment of maintenance and location fees in accordance

9 with sections 5702 and 5703) shall not apply to those pat10 ent applications pending at the Department of the Interior

11 as of September 30, 1995. Such patents shall be issued

12 under or subject to the general mining laws in effect prior

13 to the date of enactment of this subtitle.

14 SEC. 5705. ROYALTY.

15 (a) RESERVATION OF ROYALTY.—

16 (1) IN GENERAL.—Production of locatable min17 erals (including associated minerals) from any

18 unpatented mining claim (other than those from Fed19 eral lands to which subsection 5704(c) applies) or any

20 mining claim patented under subsection 5704(a), in21 cluding mineral concentrates and products derived

22 from locatable minerals, shall be subject to the pay23 ment of a royalty of 2.5 percent on the Net Smelter

24 Return of all ores, minerals, metals, and materials

25 mined and removed and sold.
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1 (2) WAIVER.—If the Secretary determines that

2 the Secretary’s cost of accounting for and collecting a

3 royalty for any mineral exceeds or is likely to exceed

4 the amount of royalty to be collected, the Secretary

5 shall waive such royalty. The obligation to pay royal6 ties hereunder shall accrue only upon the sale of

7 locatable minerals or mineral products produced from

8 a mining claim subject to such royalty, and not upon

9 the stockpiling of the same for future processing.

10 (3) EXEMPTION.—Any mine with an annual

11 Revenues Received of less than $500,000 shall be ex12 empt from the requirement to pay a royalty under

13 this section.

14 (4) DEFINITION.—

15 (A) ‘‘Net Smelter Return’’ means the ‘‘Reve16 nues Received’’ for such ores, minerals, metals or

17 materials, less the ‘‘Allowable Deductions’’ for

18 any calendar year.

19 (B) ‘‘Revenues Received’’ means the pro20 ceeds from the sale of ores mined from the claims

21 or patents before subtracting the ‘‘Allowable De22 ductions’’, or, in the case of sales of beneficiated

23 products from locatable minerals such as cath24 ode, anode or copper rod or wire, or other prod25 ucts fabricated from the locatable minerals, the
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1 gross income from mining derived from the first

2 commercially marketable product determined in

3 the same manner as under Section 613 of the In4 ternal Revenue Code, before subtracting the ‘‘Al5 lowable Deductions.’’ Sales or transfers of ores to

6 affiliates shall be valued at the fair market value

7 of the products sold or transferred. Without lim8 iting the foregoing, the profits or losses incurred

9 in connection with forward sales, futures or com10 modity options trading, metal loans, or any

11 other price hedging or speculative activity or ar12 rangement shall not be included in Revenues Re13 ceived.

14 (C) ‘‘Allowable Deductions’’ means the fol15 lowing costs and expenses actually incurred or

16 paid to third parties by the royalty payor: proc17 essing and treatment cost, costs for all transpor18 tation and insurance for ores or products pro19 duced from ores mined from the claim, group of

20 claims or patents comprising an operation, be21 tween the mine and processing facilities, from

22 one processing facility to another, and from

23 processing facilities to the point of delivery of

24 said ores or products; assaying charges, umpire

25 charges, independent representative charges; all
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1 charges by purchasers of said ores or products;

2 all taxes (except income taxes) measured by or

3 valued upon production.

4 (5) REVENUES RECEIVED.—All Revenues Re5 ceived and Allowable Deductions shall be determined

6 in accordance with generally accepted accounting

7 principles and practices consistently applied. Reve8 nues Received and Allowable Deductions shall be de9 termined by the accrual method.

10 (6) ALLOWABLE DEDUCTIONS.—Where any Al11 lowable Deductions are incurred in conjunction with

12 like costs for mineral products from other properties

13 controlled by the payor such costs shall be fairly allo14 cated and apportioned in accordance with generally

15 accepted practices in the mining industry.

16 (7) COMMINGLING.—The payor shall have the

17 right to commingle ore and minerals from the claim,

18 group of claims, or patent comprising an operation,

19 with ore from other lands and properties: Provided,

20 however, That the payor shall calculate from rep21 resentative samples the average grade of the ore before

22 commingling. If concentrates are produced from the

23 commingled ores, the payor shall calculate from rep24 resentative samples calculating the average grade of

25 the ore, and calculating average recovery percentages
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1 the payor shall use procedures accepted in the mining

2 and metallurgical industry suitable for the type of

3 mining and processing activity being conducted.

4 (8) EFFECTIVE DATE.—

5 (A) IN GENERAL.—The royalty required

6 under this section shall take effect with respect to

7 production on or after the first day of the first

8 month following the date of enactment of this

9 subtitle.

10 (B) PHASE-IN.—The royalty payments re11 quired under this section shall be reduced—

12 (i) by 66 2/3 percent for the first 12

13 months following the date of enactment of

14 this subtitle for which royalties are due on

15 production pursuant to this subtitle; and

16 (ii) by 33 1/3 percent for the second 12

17 months that royalties are due on production

18 pursuant to this subtitle.

19 (C) TIME FOR PAYMENT.—Any royalty pay20 ment attributable to production during the first

21 15 calendar months after the date of enactment

22 of this subtitle, after any reduction under para23 graph (B), shall be due on the date that is 12

24 months after the date of enactment of this sub25 title.
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1 (D) NO MARKETABLE QUANTITY PRIOR TO

2 DATE OF ENACTMENT.—For a claim, group of

3 claims, or patents comprising an operation that

4 has not produced a marketable quantity prior to

5 the date of enactment of this subtitle, the royalty

6 payments required pursuant to this section shall

7 be reduced—

8 (i) by 66 2/3 percent for the first 12

9 months following the date of enactment of

10 this subtitle for which royalties are due on

11 production pursuant to this subtitle; and

12 (ii) by 33 1/3 percent for the second 12

13 months that royalties are due on production

14 pursuant to this subtitle.

15 (9) ROYALTY REDUCTION FOR MARGINAL OPER16 ATIONS.—

17 (A) APPLICATION.—A person that is re18 quired to make a royalty payment under this

19 section may file for a reduction or waiver of the

20 royalty by demonstrating that payment of the

21 royalty would preclude recovery of costs of pro22 duction, including invested capital, for a claim,

23 group of claims or patents comprising an oper24 ation for the remaining reasonable life of the op25 eration: Provided, That the Secretary shall not
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1 consider royalty reduction effective during the

2 phase-in periods under paragraph (8). For pur3 poses of this initial application, ‘‘Projected Reve4 nues’’ shall be calculated using the operator’s

5 current and projected rates of production at the

6 average price for the preceding 12 months.

7 (B) DEFINITION.—For purposes of an ap8 plication under subparagraph (A)—

9 (i) ‘‘Projected Revenues’’ shall be the

10 net present value of the expected revenues

11 for the remaining reasonable life of the op12 eration calculated using the average min13 eral price received for the preceding 12

14 month calendar year.

15 (ii) ‘‘Costs of Production’’ shall mean

16 the net present value of the following costs

17 based on the expected rate of production for

18 the remaining reasonable life of the oper19 ation—

20 (I) the projected cost of extracting

21 the locatable mineral;

22 (II) the projected cost of trans23 porting the locatable mineral to the

24 place or places of reduction,

25 beneficiation, refining and sale;
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1 (III) the projected cost of reduc2 tion, beneficiation, refining and sale of

3 the locatable mineral;

4 (IV) the projected cost of market5 ing and delivering the locatable min6 eral and the conversion of the locatable

7 mineral into money;

8 (V) the projected cost of mainte9 nance and repairs of all machinery,

10 equipment, apparatus, and facilities

11 used in the mine; all crushing, milling,

12 leaching, refining, smelting, and reduc13 tion works, plants, and facilities; and

14 all facilities and equipment for trans15 portation;

16 (VI) the projected cost for support

17 personnel and support services at the

18 mine site, including without limita19 tion, accounting, assaying, drafting,

20 and mapping, computer services, sur21 veying, housing, camp and office ex22 penses, safety and security;

23 (VII) the projected cost of engi24 neering, sampling, and assaying per-
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1 taining to development and produc2 tion;

3 (VIII) the projected cost of per4 mitting, reclamation, environmental

5 compliance and monitoring;

6 (IX) the projected cost of fire and

7 other insurance on the machinery,

8 equipment, apparatus, works, plants

9 and facilities mentioned in subclause

10 (B)(ii)(V);

11 (X) depreciation of the original

12 capitalized cost of the machinery,

13 equipment, apparatus, works, plants,

14 and facilities listed in subclause

15 (B)(ii)(V), considering the probable life

16 of the property in computing the an17 nual depreciation charge;

18 (XI) all money expended for pre19 miums for industrial insurance, and

20 the owner-paid cost of hospital and

21 medical attention and accident benefits

22 and group insurance for all employees

23 engaged in the production or process24 ing of locatable minerals;
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1 (XII) all money paid as contribu2 tions or payments under State unem3 ployment compensation law, all money

4 paid as contributions under the Fed5 eral Social Security Act, and all

6 money paid to State government in

7 real property taxes measured or levied

8 on production, or Federal excise tax

9 payments and payments as fees or

10 charges for use of the Federal lands

11 from which the locatable minerals are

12 produced; and

13 (XIII) the projected cost of devel14 opmental work in or about the mine or

15 upon a group of mines when operated

16 as a unit.

17 (C) For purposes of the annual depreciation

18 charge under paragraph (B)(ii)X)—

19 (i) Any expenditure not otherwise de20 scribed in this clause which is not deduct21 ible in the year paid or incurred pursuant

22 to the Internal Revenue Code of 1986, and

23 which is:

24 (I) attributable to the direct ac25 quisition of mining claims purchased
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1 separately or as part of a group of as2 sets, or

3 (II) attributable to the indirect

4 acquisition of mining property or min5 ing claims by reason of being a portion

6 of the consideration for an interest in

7 a corporation, partnership or trust (in

8 connection with an ownership change

9 of such entity determined under the

10 principles of Section 382(g) of the In11 ternal Revenue Code of 1986) allocable

12 to such property or claims of such en13 tity, shall be allowable as a deprecia14 tion deduction to the purchaser in the

15 case of an expenditure described in (I)

16 or to the acquired corporation, part17 nership or trust in the case of an ex18 penditure described in (II), ratably

19 over a period based on the probable life

20 of the property, beginning with the

21 taxable year in which such expenditure

22 was made.

23 (ii) The deduction allowed for costs at24 tributable to mining property or claims is

25 available only at the election of the pur-
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1 chaser in the case of expenditures described

2 in (i)(I), or at the election of both the pur3 chaser and acquired corporation, partner4 ship or trust in the case of expenditures de5 scribed in (i)(II), and is in lieu of any

6 other deduction otherwise allowable under

7 this section with respect to such expendi8 ture.

9 (D) If the Costs of Production for the oper10 ation exceed the Projected Revenues, the Sec11 retary shall waive in full the royalty obligation.

12 If the Projected Revenues exceed the Costs of Pro13 duction by less than the full royalty obligation

14 under subsection (a), the Secretary shall reduce

15 the royalty rate to a level allowing the recovery

16 of the Costs of Production, including invested

17 capital, over the remaining reasonable life of the

18 operation.

19 (10) SPLIT ESTATES.—For circumstances where

20 a claim, group of claims or patent is subject to this

21 section but does not comprise the entirety of a mine,

22 the Annual Revenues and Costs of Production shall be

23 allocated for royalty purposes in proportion to the

24 value of production recovered from the claim, group

25 of claims or patent.
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1 (11) JUDICIAL REVIEW.—A determination by the

2 Secretary under paragraph (9) shall be judicially

3 reviewable under section 702 of title 5, United States

4 Code, only for actions filed within 180 days of the

5 Secretary’s determination.

6 (12) ANNUAL FILING OF DATA.—If a reduction

7 in royalty is provided under this paragraph, the roy8 alty payor shall file cost and revenue data with the

9 Secretary annually during the period of royalty

10 waiver or reduction.

11 (b) DUTIES OF CLAIM HOLDERS, OPERATORS AND

12 TRANSPORTERS.—A person that is required to make a roy13 alty payment under this section shall make quarterly esti14 mates of the royalty obligation and shall make the payment

15 to the United States annually in such manner as the Sec16 retary of the Interior may by rule prescribe. The owner or

17 co-owners of a mining claim shall be liable for royalty on

18 locatable minerals produced and sold during the period of

19 ownership to the extent of the interest in such claim owned.

20 As used in this subsection, ‘‘owner’’ or ‘‘co-owner’’ shall

21 mean the person or persons owning the right to mine

22 locatable minerals from such claim and receiving the reve23 nues of sale. Any person who makes any royalty payment

24 attributable to the interest of the owner or co-owners liable
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1 therefor shall not become liable to the United States for such

2 royalty as a result.

3 (c) MANNER OF PAYMENT.—

4 (1) Each royalty payment or adjustment shall be

5 accompanied by a statement containing:

6 (A) the name and Bureau of Land Manage7 ment serial number of the mining claim or

8 claims from which ores, concentrates, solutions

9 or beneficiated products of locatable minerals

10 subject to the royalty required in this section

11 were produced and sold for the period covered by

12 such payment or adjustment;

13 (B) the estimated (or actual, if determined)

14 quantity of such ore, concentrates, solutions or

15 beneficiated or fabricated products produced and

16 sold from such mining claim or claims for such

17 period;

18 (C) the estimated (or actual, if determined)

19 Gross Yield from the production and sale of such

20 ore, concentrates, solutions or beneficiated prod21 ucts for such period;

22 (D) the estimated (or actual, if determined)

23 Net Smelter Return from the production and sale

24 of such ores, concentrates, solutions or

25 beneficiated products for such period, including
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1 an itemization of the applicable deductions de2 scribed in paragraph 20(a)(4)(A); and

3 (E) the estimated (or actual, if determined)

4 royalty due to the United States, or adjustment

5 due to the United States or such owner or co6 owners, for such period.

7 (2) In lieu of receiving a refund under subsection

8 (e), the owner or co-owners may elect to apply any

9 adjustment due to such owner or co-owners as an off10 set against royalties due from such owner or co-own11 ers to the United States under this Subtitle, regardless

12 of whether such royalties are due for production and

13 sale from the same mining claim or claims.

14 (d) RECORDKEEPING AND REPORTING REQUIRE15 MENTS.—

16 (1) An owner, operator, or other person directly

17 involved in the conduct of mineral activities, trans18 portation, purchase, or sale of locatable minerals, con19 centrates, or products derived therefrom, subject to the

20 royalty required in this section, through the point of

21 royalty computation, shall establish and maintain

22 any records, make any reports, and provide any in23 formation that the Secretary may reasonably require

24 for the purposes of implementing this section or deter25 mining compliance with regulations or orders under
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1 this section. Upon the request of the Secretary when

2 conducting an audit or investigation pursuant to sub3 section (f), the appropriate records, reports, or infor4 mation which may be required by this section shall

5 be made available for inspection and duplication by

6 the Secretary.

7 (2) Records required by the Secretary under this

8 section shall be maintained for three years after the

9 records are generated unless the Secretary notifies the

10 record holder that he or she has initiated an audit or

11 investigation specifically identifying and involving

12 such records and that such records must be main13 tained for a longer period. When an audit or inves14 tigation is under way, such records shall be main15 tained until the earlier of the date that the Secretary

16 releases the record holder of the obligation to main17 tain such records or the date that the limitations pe18 riod applicable to such audit or investigation under

19 subsection (f) expires.

20 (e) INTEREST ASSESSMENTS.—In any case in which

21 royalty payments are not received by the Secretary on the

22 date that such payments are due, or when such payments

23 are less than the amount due, the Secretary shall charge

24 interest on such late payments computed at the rate pub25 lished by the Department of the Treasury as the ‘‘Treasury
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1 Current Value of Funds Rate.’’ In the case of an

2 underpayment or partial payment, interest shall be com3 puted and charged only on the amount of the deficiency

4 and not on the total amount, and only for the number of

5 days such payment is late. No other late payment or

6 underpayment charge or penalty shall be charged. In any

7 case in which royalty payments are made in excess of the

8 amount due, or amounts are held by the Secretary pending

9 the outcome of any appeal in which the Secretary does not

10 prevail, the Secretary shall promptly refund such overpay11 ments or pay such amounts to the person or persons entitled

12 thereto, together with interest thereon for the number of days

13 such overpayment or amounts were held by the Secretary,

14 with the addition of interest charged against the United

15 States computed at the rate published by the Department

16 of the Treasury as the ‘‘Treasury Current Value of Funds

17 Rate’’.

18 (f) AUDITS, PAYMENT DEMANDS AND LIMITATIONS.—

19 (1) The Secretary may conduct, after notice, any

20 audit reasonably necessary and appropriate to verify

21 the payments required under this section.

22 (2) Any billing or demand letter for royalty due

23 on locatable minerals produced and sold from any

24 mining claim subject to royalty required by this sec25 tion must be sent or issued not later than three years
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1 after the date such royalty was due and must specifi2 cally identify the production involved, the royalty al3 legedly due and the basis for the claim. No action,

4 proceeding or claim for royalty due on locatable min5 erals produced and sold, or relating to such produc6 tion, may be brought by the United States, including

7 but not limited to any claim for additional royalties

8 or claim of the right to offset the amount of such ad9 ditional royalties against amounts owed to any per10 son by the United States, unless judicial suit or ad11 ministrative proceedings are commenced to recover

12 specific amounts claimed to be due prior to the expi13 ration of three years from the date such royalty is al14 leged to have been due.

15 (g) PENALTIES.—Any person who withholds payment

16 of royalties under this section after a final, nonappealable

17 determination of liability may be liable for civil penalties

18 of up to $5,000 per day that payment is withheld after be19 coming due.

20 (h) DISBURSEMENT OF REVENUES.—The receipts from

21 royalties collected under this section shall be disbursed as

22 follows:

23 (1) One-half of such receipts shall be paid into

24 the Treasury of the United States and deposited as

25 miscellaneous receipts; and
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1 (2) One-half of such receipts shall be paid into

2 a State Fund or the Federal Fund in accordance with

3 section 5706; until termination as provided in section

4 5710.

5 SEC. 5706. ABANDONED LOCATABLE MINERALS MINE REC6 LAMATION FUND.

7 (a) STATE FUND.—Any State within which royalties

8 are collected pursuant to section 5705 from a mining claim

9 and which wishes to become eligible to receive such proceeds

10 allocated by paragraph 5705(h)(2) shall establish and

11 maintain an interest-bearing abandoned locatable mineral

12 mine reclamation fund (hereinafter referred to in this sub13 title as ‘‘State Fund’’) to accomplish the purposes of this

14 subtitle.

15 (b) FEDERAL FUND.—There is established on the books

16 of the Treasury of the United States an interest-bearing

17 fund to be known as the Abandoned Locatable Minerals

18 Mine Reclamation Fund (hereinafter referred to in this sub19 title as ‘‘Federal Fund’’) which shall consist of royalty pro20 ceeds allocated by paragraph 5705(h)(2) from mining

21 claims in a State where a State Fund has not been estab22 lished or maintained under subsection (a).

23 SEC. 5707. ALLOCATION AND PAYMENTS.

24 (a) STATE FUND.—Royalties collected pursuant to sec25 tion 5705 and allocated by paragraph 5705(h)(2) shall be
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1 paid by the Secretary of the Treasury to the State Fund

2 established pursuant to subsection 5706(a) for the State

3 where the mining claim from which the production occurred

4 is located. Payments to States under this subsection with

5 respect to any royalties received by the United States, shall

6 be made not later than the last business day of the month

7 in which such royalties are warranted by the United States

8 Treasury to the Secretary of the Interior as having been

9 received, except for any portion of such royalties which is

10 under challenge, which shall be placed in a suspense account

11 pending resolution of such challenge. Such warrants shall

12 be issued by the United States Treasury not later than 10

13 days after receipt of such royalties by the Treasury. Royal14 ties placed in a suspense account which are determined to

15 be due the United States shall be payable to a State Fund

16 not later than fifteen days after such challenge is resolved.

17 Any such amount placed in a suspense account pending res18 olution shall bear interest until the challenge is resolved.

19 In determining the amount of payments to State Funds

20 under this section, the amount of such payments shall not

21 be reduced by any administrative or other costs incurred

22 by the United States.

23 (b) FEDERAL FUND.—Royalties collected pursuant to

24 section 5705, and allocated by paragraph 5705(h)(2), from

25 mining claims located in a State which has not established
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1 or maintained a State Fund, and such royalties from min2 ing claims located in a State for which the Secretary’s au3 thority has expired under subsection 5710(a), shall be cred4 ited to the Federal Fund and distributed in accordance with

5 subsection (c).

6 (c) TRANSITION.—Prior to the time a State establishes

7 a State Fund pursuant to subsection 5706(a), any royalties

8 collected from a mining claim within such State shall be

9 deposited into the Federal Fund and allocated to such State.

10 Once a State establishes a State Fund under subsection

11 5706(a), the State allocation in the Federal Fund with ac12 crued interest shall be paid by the Secretary of the Treasury

13 to the State Fund in accordance with subsection (a). Com14 mencing three years after the date of enactment of this sub15 title, the Secretary of the Treasury shall distribute royalty

16 proceeds then accrued or which are thereafter credited to

17 the Federal Fund equally among all States which maintain

18 a State Fund established under subsection 5706(a), and for

19 which the Secretary of the Treasury’s authority has not ex20 pired under subsection 5710(a).

21 SEC. 5708. ELIGIBLE AREA.

22 (a) IN GENERAL.—Subject to subsection (b), lands and

23 water eligible for reclamation under this subtitle shall be

24 Federal lands or private lands patented under the general

25 mining laws that—
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1 (1) have been adversely affected by past mineral

2 activities on lands abandoned and left inadequately

3 reclaimed prior to the date of enactment of this Sub4 title; and

5 (2) for which the State determines there is no

6 identifiable party with a continuing reclamation re7 sponsibility under State or Federal laws.

8 (b) SPECIFIC SITES AND AREAS NOT ELIGIBLE.—The

9 following areas shall not be eligible for expenditures from

10 a State Fund:

11 (1) Any area subject to a plan of operations sub12 mitted or approved prior to, on or after the date of

13 enactment of this subtitle which includes remining or

14 reclamation of the area adversely affected by past

15 locatable mineral activities.

16 (2) Any area affected by coal mining eligible for

17 reclamation expenditures pursuant to section 404 of

18 the Surface Mining Control and Reclamation Act (30

19 U.S.C. 1234).

20 (3) Any area designated for remedial action pur21 suant to the Uranium Mill Tailings Radiation Con22 trol Act of 1978 (42 U.S.C. 7912).

23 (4) Any area that was listed on the National

24 Priorities List pursuant to the Comprehensive Envi25 ronmental Response, Compensation and Liability Act
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1 of 1980 (42 U.S.C. 9605) prior to the date of enact2 ment of this subtitle, or where the Environmental

3 Protection Agency has initiated or caused to be initi4 ated a response action pursuant to that Act.

5 SEC. 5709. USES AND OBJECTIVES OF FUNDS.

6 (a) USE OF FUNDS.—Royalty proceeds in a State

7 Fund shall be used for the reclamation of eligible areas. For

8 purposes of this section, reclamation includes—

9 (1) backfilling, fencing, sealing, or otherwise con10 trolling abandoned underground mine entries to pro11 tect public health and safety;

12 (2) abatement, treatment or control of water pol13 lution;

14 (3) shaping, grading, contouring and

15 revegetation of land to prevent erosion and sedimenta16 tion, or to enhance fish and wildlife habitat;

17 (4) removal or control of toxic or hazardous ma18 terials; and

19 (5) control or reclamation of surface subsidence

20 due to abandoned underground mines.

21 (b) PRIORITIES.—Expenditures of royalty proceeds

22 from a State Fund shall reflect the following priorities in

23 the order stated, but shall not preclude, where feasible and

24 appropriate, a combination of these priorities for cost-effec25 tive reclamation:
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1 (1) The protection of public health, safety, gen2 eral welfare and property from extreme danger from

3 the adverse effects of past mineral activities.

4 (2) The protection of public health, safety, and

5 general welfare from the adverse effects of past min6 eral activities.

7 SEC. 5710. SUNSET PROVISIONS.

8 (a) TERMINATION OF AUTHORITY.—The Secretary of

9 the Treasury’s authority to allocate funds to a State Fund

10 under section 5707 shall expire on the date that the State

11 submits a report to the Congress which states that there are

12 no areas in the State which remain to be reclaimed.

13 (b) TERMINATION OF FUND.—Upon the termination of

14 authority as provided in subsection (a) with respect to all

15 State Funds, the Federal Fund shall also be terminated,

16 and all royalty proceeds thereafter remaining in the Federal

17 Fund shall be paid into the Treasury of the United States

18 and deposited as miscellaneous receipts.

19 SEC. 5711. EFFECT ON THE GENERAL MINING LAWS.

20 The provisions of this Subtitle shall supersede the gen21 eral mining laws only to the extent such laws conflict with

22 the requirements of this Subtitle. Where no such conflict ex23 ists, the general mining laws, including all judicial and

24 administrative decisions interpreting them, shall remain in

25 full force and effect.
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1 SEC. 5712. SEVERABILITY.

2 If any provision of this subtitle or the applicability

3 thereof to any person or circumstances is held invalid, the

4 remainder of this Subtitle and the application of such pro5 vision to other persons or circumstances shall not be affected

6 thereby.

7 Subtitle I—Department of the

8 Interior

9 SEC. 5800. AIRCRAFT SERVICES.

10 (a) USE OF PRIVATE CONTRACTORS.—By not later

11 than October 1, 1996, the Secretary of the Interior shall

12 contract with private entities for the provision of all air13 craft services required by the Department of the Interior,

14 other than those available from existing DOI aircraft whose

15 primary purpose is fire suppression.

16 (b) SALE OF FEDERAL AIRCRAFT.—By September 30,

17 1998, the Secretary of the Interior is authorized and di18 rected to sell all aircraft owned by the Department of the

19 Interior, and all associated equipment and facilities, other

20 than those whose primary purpose is fire suppression.

21 (c) EXEMPTIONS.—The disposition of assets under this

22 section is not subject to section 202 and 203 of the Federal

23 Property and Administrative Services Act of 1949 (40

24 U.S.C. 483 and 484) or section 13 of the Surplus Property

25 Act of 1944 (50 U.S.C. App. 1622).
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1 (d) DISPOSITION OF PROCEEDS.—The proceeds from

2 dispositions under this section shall be returned to the

3 Treasury as miscellaneous receipts and all savings from re4 duced overhead and other costs related to the management

5 of the assets sold shall be returned to the Treasury.

6 Subtitle J—Power Marketing

7 Administrations

8 PART I—BONNEVILLE POWER ADMINISTRATION

9 REFINANCING

10 SEC. 5900. DEFINITIONS.

11 For the purposes of this subtitle—

12 (1) ‘‘Administrator’’ means the Administrator of

13 the Bonneville Power Administration;

14 (2) ‘‘capital investment’’ means a capitalized

15 cost funded by Federal appropriations that—

16 (A) is for a project, facility, or separable

17 unit or feature of a project or facility;

18 (B) is a cost for which the Administrator is

19 required by law to establish rates to repay to the

20 United States Treasury through the sale of elec21 tric power, transmission, or other services;

22 (C) excludes a Federal irrigation invest23 ment; and

24 (D) excludes an investment financed by the

25 current revenues of the Administrator or by
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1 bonds issued and sold, or authorized to be issued

2 and sold, by the Administrator under section 13

3 of the Federal Columbia River Transmission

4 System Act (16 U.S.C.838(k));

5 (3) ‘‘new capital investment’’ means a capital

6 investment for a project, facility, or separable unit or

7 feature of a project, facility, or separable unit or fea8 ture of a project or facility, placed in service after

9 September 30, 1995;

10 (4) ‘‘old capital investment’’ means a capital in11 vestment whose capitalized cost—

12 (A) was incurred, but not repaid, before Oc13 tober 1, 1995, and

14 (B) was for a project, facility, or separable

15 unit or feature of a project or facility, placed in

16 service before October 1, 1995;

17 (5) ‘‘repayment date’’ means the end of the pe18 riod within which the Administrator’s rates are to as19 sure the repayment of the principal amount of a cap20 ital investment; and

21 (6) ‘‘Treasury rate’’ means—

22 (A) for an old capital investment, a rate de23 termined by the Secretary of the Treasury, tak24 ing into consideration prevailing market yields,

25 during the month preceding October 1, 1995, on
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1 outstanding interest-bearing obligations of the

2 United States with periods to maturity com3 parable to the period between October 1, 1995,

4 and the repayment date for the old capital in5 vestment; and

6 (B) for a new capital investment, a rate de7 termined by the Secretary of the Treasury, tak8 ing into consideration prevailing market yields,

9 during the month preceding the beginning of the

10 fiscal year in which the related project, facility,

11 or separable unit or feature is placed in service,

12 on outstanding interest-bearing obligations of the

13 United States with periods to maturity com14 parable to the period between the beginning of

15 the fiscal year and the repayment date for the

16 new capital investment.

17 SEC. 5901. NEW PRINCIPAL AMOUNTS.

18 (a) PRINCIPAL AMOUNT.—Effective October 1, 1995,

19 an old capital investment has a new principal amount that

20 is the sum of—

21 (1) the present value of the old payment amounts

22 for the old capital investment, calculated using a dis23 count rate equal to the Treasury rate for the old cap24 ital investment; and
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1 (2) an amount equal to $100,000,000 multiplied

2 by a fraction whose numerator is the principal

3 amount of the old payment amounts for the old cap4 ital investment and whose denominator is the sum of

5 the principal amounts of the old payment amounts

6 for all old capital investments.

7 (b) DETERMINATION.—With the approval of the Sec8 retary of the Treasury based solely on consistency with this

9 part the Administrator shall determine the new principal

10 amounts under section 5901 and the assignment of interest

11 rates to the new principal amounts under section 5902.

12 (c) OLD PAYMENT AMOUNT.—For the purposes of this

13 section, ‘‘old payment amounts’’ means, for an old capital

14 investment, the annual interest and principal that the Ad15 ministrator would have paid to the United States Treasury

16 from October 1, 1995, if this part were not enacted, assum17 ing that—

18 (1) the principal were repaid—

19 (A) on the repayment date the Adminis20 trator assigned before October 1, 1993, to the old

21 capital investment, or

22 (B) with respect to an old capital invest23 ment for which the Administrator has not as24 signed a repayment date before October 1, 1993,

25 on a repayment date the Administrator shall as-
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1 sign to the old capital investment in accordance

2 with paragraph 10(d)(1) of the version of De3 partment of Energy Order RA 6120.2 in effect

4 on October 1, 1993; and

5 (2) interest were paid—

6 (A) at the interest rate the Administrator

7 assigned before October 1, 1993, to the old cap8 ital investment, or

9 (B) with respect to an old capital invest10 ment for which the Administrator has not as11 signed an interest rate before October 1, 1993, at

12 a rate determined by the Secretary of the Treas13 ury, taking into consideration prevailing market

14 yields, during the month preceding the beginning

15 of the fiscal year in which the related project, fa16 cility, or separable unit or feature is placed in

17 service, on outstanding interest-bearing obliga18 tions of the United States with periods to matu19 rity comparable to the period between the begin20 ning of the fiscal year and the repayment date

21 for the old capital investment.

22 SEC. 5902. INTEREST RATE FOR NEW PRINCIPAL AMOUNTS.

23 As of October 1, 1995, the unpaid balance on the new

24 principal amount established for an old capital investment

25 under section 5901 bears interest annually at the Treasury
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1 rate for the old capital investment until the earlier of the

2 date that the new principal amount is repaid or the repay3 ment date for the new principal amount.

4 SEC. 5903. REPAYMENT DATES.

5 As of October 1, 1995, the repayment date for the new

6 principal amount established for an old capital investment

7 under section 5901 is no earlier than the repayment date

8 for the old capital investment assumed in section

9 5901(c)(1).

10 SEC. 5904. PREPAYMENT LIMITATIONS.

11 During the period October 1, 1995, through September

12 30, 2000, the total new principal amounts of old capital

13 investments, as established under section 5901, that the Ad14 ministrator may pay before their respective repayment

15 dates shall not exceed $100,000,000.

16 SEC. 5905. INTEREST RATES FOR NEW CAPITAL INVEST17 MENTS DURING CONSTRUCTION.

18 (a) NEW CAPITAL INVESTMENT.—The principal

19 amount of a new capital investment includes interest in

20 each fiscal year of construction of the related project, facil21 ity, or separable unit or feature at a rate equal to the one22 year rate for the fiscal year on the sum of—

23 (1) construction expenditures that were made

24 from the date construction commenced through the

25 end of the fiscal year, and
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1 (2) accrued interest during construction.

2 (b) PAYMENT.—The Administrator is not required to

3 pay, during construction of the project, facility, or sepa4 rable unit or feature, the interest calculated, accrued, and

5 capitalized under subsection (a).

6 (c) ONE-YEAR RATE.—For the purposes of this section,

7 ‘‘one-year rate’’ for a fiscal year means a rate determined

8 by the Secretary of the Treasury, taking into consideration

9 prevailing market yields, during the month preceding the

10 beginning of the fiscal year, on outstanding interest-bearing

11 obligations of the United States with periods to maturity

12 of approximately one year.

13 SEC. 5906. INTEREST RATES FOR NEW CAPITAL INVEST14 MENTS.

15 The unpaid balance on the principal amount of a new

16 capital investment bears interest at the Treasury rate for

17 the new capital investment from the date the related project,

18 facility, or separable unit or feature is placed in service

19 until the earlier of the date the new capital investment is

20 repaid or the repayment date for the new capital invest21 ment.

22 SEC. 5907. APPROPRIATED AMOUNTS.

23 The Confederated Tribe of the Colville Reservation

24 Grand Coulee Dam Settlement Act (Public Law No. 103–
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1 436) is amended by striking section 6 and its catchline and

2 inserting the following:

3 ‘‘SEC. 6. APPROPRIATED AMOUNTS.

4 ‘‘(a) APPROPRIATED AMOUNTS.—Without fiscal year

5 limitation, there are appropriated to the Administrator

6 $15.25 million in fiscal year 1996, $15.86 million in fiscal

7 year 1997, $16.49 million in fiscal year 1998, $17.15 mil8 lion in fiscal year 1999, $17.84 million in fiscal year 2000,

9 and $4.10 million in each succeeding fiscal year so long

10 as the Administrator makes annual payments to the Tribes

11 under the settlement agreement.

12 ‘‘(b) DEFINITIONS.—For the purposes of this section—

13 ‘‘(1) ‘settlement agreement’ means that settlement

14 agreement between the United States of America and

15 the Confederated Tribes of the Colville Reservation

16 signed by the Tribes on April 16, 1994, and by the

17 United States of America on April 21, 1994, which

18 settlement agreement resolves claims of the Tribes in

19 Docket 181–D of the Indian Claims Commission,

20 which docket has been transferred to the United States

21 Court of Federal Claims; and

22 ‘‘(2) ‘Tribes’ means the Confederated Tribes of

23 the Colville Reservation, a federally recognized Indian

24 Tribe.’’.
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1 SEC. 5908. CONTRACT PROVISIONS.

2 In each contract of the Administrator that provides for

3 the Administrator to sell electric power, transmission, or

4 related services, and that is in effect after September 30,

5 1995, the Administrator shall offer to include, or as the case

6 may be, shall offer to amend to include, provisions specify7 ing that after September 30, 1995—

8 (1) the Administrator shall establish rates and

9 charges on the basis that—

10 (A) the principal amount of an old capital

11 investment shall be no greater than the new

12 principal amount established under section 5901

13 of this part;

14 (B) the interest rate applicable to the un15 paid balance of the new principal amount of an

16 old capital investment shall be no greater than

17 the interest rate established under section 5902 of

18 this part;

19 (C) any payment of principal of an old

20 capital investment shall reduce the outstanding

21 principal balance of the old capital investment

22 in the amount of the payment at the time the

23 payment is tendered; and

24 (D) any payment of interest on the unpaid

25 balance of the new principal amount of an old

26 capital investment shall be a credit against the
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1 appropriate interest account in the amount of

2 the payment at the time the payment is ten3 dered;

4 (2) apart from charges necessary to repay the

5 new principal amount of an old capital investment as

6 established under section 5901 of this part and to pay

7 the interest on the principal amount under section

8 5902 of this part, no amount may be charged for re9 turn to the United States Treasury as repayment for

10 or return on an old capital investment, whether by

11 way of rate, rent, lease payment, assessment, user

12 charge, or any other fee;

13 (3) amounts provided under section 1304 of title

14 31, United States Code, shall be available to pay, and

15 shall be the sole source for payment of, a judgment

16 against or settlement by the Administrator or the

17 United States on a claim for a breach of the contract

18 provisions required by this part; and

19 (4) the contract provisions specified in this part

20 do not—

21 (A) preclude the Administrator from recov22 ering, through rates or other means, any tax that

23 is generally imposed on electric utilities in the

24 United States, or
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1 (B) affect the Administrator’s authority

2 under applicable law, including section 7(g) of

3 the Pacific Northwest Electric Power Planning

4 and Conservation Act (16 U.S.C. 839e(g)), to—

5 (i) allocate costs and benefits, includ6 ing but not limited to fish and wildlife

7 costs, to rates or resources, or

8 (ii) design rates.

9 SEC. 5909. SAVINGS PROVISIONS.

10 (a) REPAYMENT.—This part does not affect the obliga11 tion of the Administrator to repay the principal associated

12 with each capital investment, and to pay interest on the

13 principal, only from the ‘‘Administrator’s net proceeds,’’ as

14 defined in section 13 of the Federal Columbia River Trans15 mission System Act (16 U.S.C. 838k(b)).

16 (b) PAYMENT OF CAPITAL INVESTMENT.—Except as

17 provided in section 5904 of this part, this part does not

18 affect the authority of the Administrator to pay all or a

19 portion of the principal amount associated with a capital

20 investment before the repayment date for the principal

21 amount.
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1 PART II—ALASKA POWER MARKETING

2 ADMINISTRATION SALE

3 SEC. 5910. SALE OF SNETTISHAM AND EKLUTNA HYDRO4 ELECTRIC PROJECTS.

5 (a) SALE OF SNETTISHAM.—The Secretary of Energy

6 is authorized and directed to sell the Snettisham Hydro7 electric Project (referred to in this part as ‘‘Snettisham’’)

8 to the State of Alaska in accordance with the terms of this

9 part and the February 10, 1989, Snettisham Purchase

10 Agreement, as amended, between the Alaska Power Admin11 istration of the United States Department of Energy and

12 the Alaska Power Authority and the Authority’s successors.

13 (b) SALE OF EKLUTNA.—The Secretary of Energy is

14 authorized and directed to sell the Eklutna Hydroelectric

15 Project (referred to in this part as ‘‘Eklutna’’) to the Mu16 nicipality of Anchorage doing business as Municipal Light

17 and Power, the Chugach Electric Association, Inc., and the

18 Matanuska Electric Association, Inc. (referred to in this

19 part as ‘‘Eklutna Purchasers’’), in accordance with the

20 terms of this part and the August 2, 1989, Eklutna Pur21 chase Agreement, as amended, between the Alaska Power

22 Administration of the United States Department of Energy

23 and the Eklutna Purchasers.

24 (c) FEDERAL SALE ASSISTANCE.—The heads of other

25 Federal departments and agencies, including the Secretary
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1 of the Interior, shall assist the Secretary of Energy in im2 plementing the sales authorized and directed by this part.

3 (d) DISPOSITION OF PROCEEDS.—Proceeds from the

4 sales required by this part shall be deposited in the Treas5 ury of the United States to the credit of miscellaneous re6 ceipts.

7 (e) PREPARATION OF EKLUTNA AND SNETTISHAM FOR

8 SALE.—The Secretary of Energy is authorized and directed

9 to use such funds from the sale of electric power by the Alas10 ka Power Administration as may be necessary to prepare,

11 survey and acquire Eklutna and Snettisham assets for sale

12 and conveyance. Such preparations and acquisitions shall

13 provide sufficient title to ensure the beneficial use, enjoy14 ment, and occupancy by the purchaser.

15 SEC. 5911. EXEMPTION AND OTHER PROVISIONS.

16 (a) FEDERAL POWER ACT EXEMPTION.—

17 (1) After the sales authorized by this part occur,

18 Eklutna and Snettisham, including future modifica19 tions, shall continue to be exempt from the require20 ments of the Federal Power Act (16 U.S.C. 791a et

21 seq.) as amended.

22 (2) The exemption provided by paragraph (1)

23 does not affect the Memorandum of Agreement entered

24 into among the State of Alaska, the Eklutna Pur25 chasers, the Alaska Energy Authority, and Federal
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1 fish and wildlife agencies regarding the protection,

2 mitigation of, damages to, and enhancement of fish

3 and wildlife, dated August 7, 1991, which remains in

4 full force and effect.

5 (3) Nothing in this part or the Federal Power

6 Act preempts the State of Alaska from carrying out

7 the responsibilities and authorities of the Memoran8 dum of Agreement.

9 (b) JUDICIAL REVIEW.—

10 (1) The United States District Court for the Dis11 trict of Alaska shall have jurisdiction to review deci12 sions made under the Memorandum of Agreement and

13 to enforce the provisions of the Memorandum of

14 Agreement, including the remedy of specific perform15 ance.

16 (2) An action seeking review of a Fish and Wild17 life Program (‘‘Program’’) of the Governor of Alaska

18 under the Memorandum of Agreement or challenging

19 actions of any of the parties to the Memorandum of

20 Agreement prior to the adoption of the Program shall

21 be brought not later than ninety days after the date

22 on which the Program is adopted by the Governor of

23 Alaska, or be barred.

24 (3) An action seeking review of implementation

25 of the Program shall be brought not later than ninety
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1 days after the challenged act implementing the Pro2 gram, or be barred.

3 (c) TRANSFER OF EKLUTNA.—With respect to Eklutna

4 lands described in Exhibit A of the Eklutna Purchase

5 Agreement:

6 (1) The Secretary of the Interior shall issue

7 rights-of-way to the Alaska Power Administration for

8 subsequent reassignment to the Eklutna Purchasers—

9 (A) at no cost to the Eklutna Purchasers;

10 (B) to remain effective for a period equal to

11 the life of Eklutna as extended by improvements,

12 repairs, renewals, or replacements; and

13 (C) sufficient for the operation of, mainte14 nance of, repair to, and replacement of, and ac15 cess to, Eklutna facilities located on military

16 lands and lands managed by the Bureau of Land

17 Management, including lands selected by the

18 State of Alaska.

19 (2) If the Eklutna Purchasers subsequently sell

20 or transfer Eklutna to private ownership, the Bureau

21 of Land Management may assess reasonable and cus22 tomary fees for continued use of the rights-of-way on

23 lands managed by the Bureau of Land Management

24 and military lands in accordance with existing law.
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1 (3) Fee title to lands at Anchorage Substation

2 shall be transferred to Eklutna Purchasers at no addi3 tional cost if the Secretary of the Interior determines

4 that pending claims to, and selections of, those lands

5 are invalid or relinquished.

6 (4) With respect to the Eklutna lands identified

7 in paragraph 1 of Exhibit A of the Eklutna Purchase

8 Agreement, the State of Alaska may select, and the

9 Secretary of the Interior shall convey to the State, im10 proved lands under the selection entitlements in sec11 tion 6 of the Act of July 7, 1958 (commonly referred

12 to as the Alaska Statehood Act, Public Law 85–508,

13 72 Stat. 339, as amended), and the North Anchorage

14 Land Agreement dated January 31, 1983. This con15 veyance shall be subject to the rights-of-way provided

16 to the Eklutna Purchasers under paragraph (1).

17 (d) TRANSFER OF SNETTISHAM.—With respect to the

18 Snettisham lands identified in paragraph 1 of Exhibit A

19 of the Snettisham Purchase Agreement and Public Land

20 Order No. 5108, the State of Alaska may select, and the

21 Secretary of the Interior shall convey to the State of Alaska,

22 improved lands under the selection entitlements in section

23 6 of the Act of July 7, 1958 (commonly referred to as the

24 Alaska Statehood Act, Public Law 85–508, 72 Stat. 339,

25 as amended).
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1 (e) APA TERMINATION.—Not later than one year after

2 both of the sales authorized in section 102 have occurred,

3 as measured by the Transaction Dates stipulated in the

4 Purchase Agreements, the Secretary of Energy shall—

5 (1) complete the business of, and close out, the

6 Alaska Power Administration;

7 (2) submit to Congress a report documenting the

8 sales; and

9 (3) return unobligated balances of funds appro10 priated for the Alaska Power Administration to the

11 Treasury of the United States.

12 (f) REPEAL.—The Act of July 31, 1950 (64 Stat. 382)

13 is repealed effective on the date, as determined by the Sec14 retary of Energy, that all Eklutna assets have been conveyed

15 to the Eklutna Purchasers.

16 (g) REPEAL.—Section 204 of the Flood Control Act of

17 1962 (76 Stat. 1193) is repealed effective on the date, as

18 determined by the Secretary of Energy, that all Snettisham

19 assets have been conveyed to the State of Alaska.

20 (h) CONFORMITY CHANGES TO THE DEPARTMENT OF

21 ENERGY ORGANIZATION ACT.—As of the later of the two

22 dates determined in subsections (f) and(g), section 302(a)

23 of the Department of Energy Organization Act (42 U.S.C.

24 7152(a)) is amended—

25 (1) in paragraph (1)—
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1 (A) by striking subparagraph (C); and

2 (B) by redesignating subparagraphs (D),

3 (E), and (F) as subparagraphs (C), (D), and (E)

4 respectively; and

5 (2) in paragraph (2) by striking out ‘‘and the

6 Alaska Power Administration’’ and by inserting

7 ‘‘and’’ after ‘‘Southwestern Power Administration,’’.

8 (i) REPEAL.—The Act of August 9, 1955, concerning

9 water resources investigation in Alaska (69 Stat. 618), is

10 repealed.

11 (j) ASSET DISPOSAL.—The sales of Eklutna and

12 Snettisham under this part are not considered disposal of

13 Federal surplus property under the Federal Property and

14 Administrative Services Act of 1949 (40 U.S.C. 484) or the

15 Act of October 3, 1944, popularly referred to as the ‘‘Sur16 plus Property Act of 1944’’ (50 U.S.C. App. 1622).

17 (k) For purposes of section 147(d) of the Internal Reve18 nue Code, ‘‘1st use’’ of Snettisham shall be considered to

19 occur upon acquisition of the property by or on behalf of

20 the State of Alaska.
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1 Subtitle K—Radio and Television

2 Communication Site Fees

3 SEC. 5920. RADIO AND TELEVISION COMMUNICATION SITE

4 FEES.

5 (a) ADDITIONAL USERS OF COMMUNICATION SITES.—

6 (1) If the radio or television communications site user is

7 permitted under the terms of its site use authorization from

8 the Bureau of Land Management or the Forest Service to

9 grant access to the site to additional users, then the radio

10 or television communications site user shall pay annually

11 to the Bureau of Land Management or the Forest Service

12 an amount equal to 25 percent of the gross income it re13 ceives from each such additional user during that year.

14 (2) Authorizations to radio and television communica15 tions site users shall require such site users to provide the

16 Bureau of Land Management or the Forest Service with

17 a certified list which identifies all additional users of such

18 sites and all gross revenues received from such additional

19 users. The Bureau of Land Management and the Forest

20 Service shall not require any additional user of a radio or

21 television communications site to obtain a separate author22 ization to use such a site.

23 (b) REGULATIONS.—(1) The Secretaries shall prescribe

24 appropriate rules and regulations to carry out the provi25 sions of this section.
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1 (2) Ten years after the date of enactment of this sec2 tion, the Secretaries shall establish a broad-based advisory

3 group, including representatives from the radio and tele4 vision broadcast industry, to review the schedule of charges

5 and other acceptable criteria for determining fair market

6 value for radio and television communications site users.

7 The advisory group shall report its findings to the Congress

8 no later than 1 year after it is established.

9 (c) INITIAL SCHEDULE OF CHARGES.—(1) Until

10 modified pursuant to subsection (b) of this section, the

11 schedule of charges for television communications site users

12 which the Secretaries shall prescribe pursuant to subsection

13 (a) of this section shall be as listed in exhibit 3, (television

14 rental fee schedule) in the report of the radio and television

15 broadcast use fee advisory committee dated December 1992.

16 (2) Until modified pursuant to subsection (b) of this

17 section, the schedule of charges for radio communications

18 site users which the Secretaries shall prescribe pursuant to

19 subsection (a) of this section shall be as listed in exhibit

20 4, (radio rental fee schedule) in the report of the radio and

21 television broadcast use fee advisory committee dated De22 cember 1992.

23 (d) ADVISORY GROUP.—(1) The Secretaries are di24 rected to jointly establish a broad-based advisory group

25 comprised of representatives from the non-broadcast com-
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1 munications industry (users of both private and public

2 communication sites) and the two agencies to review rec3 ommendations on acceptable criteria for determining fair

4 market values and next best alternative use.

5 (2) The advisory group shall review the methodology

6 used in any previous studies and reach concurrence on such

7 methodology.

8 (3) The advisory group shall also assess the validity

9 of the results of such studies, taking into account all reason10 able options for the establishment of fair market values and

11 next best alternative use.

12 (4) The advisory group shall report its findings to the

13 Committee on Energy and Natural Resources of the United

14 States Senate and the Committee on Natural Resources of

15 the United States House of Representatives within one year

16 after the enactment of this Act.

17 Subtitle L—Amendments to Outer

18 Continental Shelf Lands Act

19 SEC. 5930. AMENDMENTS TO THE OUTER CONTINENTAL

20 SHELF LANDS ACT.

21 Section 8(a) of the Outer Continental Shelf Lands Act,

22 (43 U.S.C. 1337(a)(3)), is amended by striking paragraph

23 (3) in its entirety and inserting the following:

24 ‘‘(3)(A) The Secretary may through primary,

25 secondary, or tertiary recovery means, reduce or
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1 eliminate any royalty or net profit share set forth in

2 the lease(s). With the lessee’s consent, the Secretary

3 may make other modifications to the royalty or net

4 profit share terms of the lease in order to—

5 ‘‘(i) promote development or increased pro6 duction on producing or non-producing leases; or

7 ‘‘(ii) encourage production of marginal re8 sources on producing or non-producing leases;

9 ‘‘(B)(i) Notwithstanding any other provision of

10 this Act, with respect to any lease or unit in existence

11 on the date of enactment of the Outer Continental

12 Shelf Deep Water Royalty Relief Act meeting the re13 quirements of this subparagraph, no royalty pay14 ments shall be due on new production, as defined in

15 clause (iv) of this subparagraph, from any lease or

16 unit located in water depths of 200 meters or greater

17 in the Western and Central Planning Areas of the

18 Gulf of Mexico, including that portion of the Eastern

19 Planning Area of the Gulf of Mexico encompassing

20 whole lease blocks lying west of 87 degrees, 30 minutes

21 West longitude, until such volume of production as

22 determined pursuant to clause (ii) has been produced

23 by the lessee.

24 ‘‘(ii) Upon submission of a complete application

25 by the lessee, the Secretary shall determine within 180
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1 days of such application whether new production

2 from such lease or unit would be economic in the ab3 sence of the relief from the requirement to pay royal4 ties provided for by clause (i) of this subparagraph.

5 In making such determination, the Secretary shall

6 consider the increased technological and financial risk

7 of deep water development and all costs associated

8 with exploring, developing, and producing from the

9 lease. The lessee shall provide information required

10 for a complete application to the Secretary prior to

11 such determination. The Secretary shall clearly define

12 the information required for a complete application

13 under this section. Such application may be made on

14 the basis of an individual lease or unit. If the Sec15 retary determines that such new production would be

16 economic in the absence of the relief from the require17 ment to pay royalties provided for by clause (i) of

18 this subparagraph, the provisions of clause (i) shall

19 not apply to such production. If the Secretary deter20 mines that such new production would not be eco21 nomic in the absence of the relief from the require22 ment to pay royalties provided for by clause (i), the

23 Secretary must determine the volume of production

24 from the lease or unit on which no royalties would be

25 due in order to make such new production economi-
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1 cally viable; except that for new production as defined

2 in clause (iv)(aa), in no case will that volume be less

3 than 17.5 million barrels of oil equivalent in water

4 depths of 200 to 400 meters, 52.5 million barrels of

5 oil equivalent in 400–800 meters of water, and 87.5

6 million barrels of oil equivalent in water depths

7 greater than 800 meters. Redetermination of the ap8 plicability of clause (i) shall be undertaken by the

9 Secretary when requested by the lessee prior to the

10 commencement of the new production and upon sig11 nificant change in the factors upon which the original

12 determination was made. The Secretary shall make

13 such redetermination within 120 days of submission

14 of a complete application. The Secretary may extend

15 the time period for making any determination or re16 determination under this clause for 30 days, or longer

17 if agreed to by the applicant, if circumstances so war18 rant. The lessee shall be notified in writing of any de19 termination or redetermination and the reasons for

20 and assumptions used for such determination. Any

21 determination or redetermination under this clause

22 shall be a final agency action. The Secretary’s deter23 mination or redetermination shall be judicially

24 reviewable under section 10 (a) of the Administrative

25 Procedures Act, 5 U.S.C. Sec. 702, only for actions
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1 filed within 30 days of the Secretary’s determination

2 or redetermination.

3 ‘‘(iii) In the event that the Secretary fails to

4 make the determination or redetermination called for

5 in clause (ii) upon application by the lessee within

6 the time period, together with any extension thereof,

7 provided for by clause (ii), no royalty payments shall

8 be due on new production as follows:

9 ‘‘(I) For new production, as defined in

10 clause (iv)(aa) of this subparagraph, no royalty

11 shall be due on such production according to the

12 schedule of minimum volumes specified in clause

13 (ii) of this subparagraph.

14 ‘‘(II) For new production, as defined in

15 clause (iv)(bb) of this subparagraph, no royalty

16 shall be due on such production for one year fol17 lowing the start of such production.

18 ‘‘(iv) For purposes of this subparagraph, the

19 term ‘new production’ is—

20 ‘‘(I) any production from a lease from

21 which no royalties are due on production, other

22 than test production, prior to the date of enact23 ment of the Outer Continental Shelf Deep Water

24 Royalty Relief Act; or
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1 ‘‘(II) any production resulting from lease

2 development activities pursuant to a Develop3 ment Operations Coordination Document, or

4 supplement thereto that would expand produc5 tion significantly beyond the level anticipated in

6 the Development Operations Coordination Docu7 ment, approved by the Secretary after the date of

8 enactment of the Outer Continental Shelf Deep

9 Water Royalty Relief Act.

10 ‘‘(v) During the production of volumes deter11 mined pursuant to clause (ii) or (iii) of this subpara12 graph, in any year during which the arithmetic aver13 age of the closing prices on the New York Mercantile

14 Exchange for Light Sweet crude oil exceeds $28.00 per

15 barrel, any production of oil will be subject to royal16 ties at the lease stipulated royalty rate. Any produc17 tion subject to this clause shall be counted toward the

18 production volume determined pursuant to clause (ii)

19 or (iii). Estimated royalty payments will be made if

20 such average of the closing prices for the previous

21 year exceeds $28.00. After the end of the calendar

22 year, when the new average price can be calculated,

23 lessees will pay any royalties due, with interest but

24 without penalty, or can apply for a refund, with in25 terest, of any overpayment.
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1 ‘‘(vi) During the production of volumes deter2 mined pursuant to clause (ii) or (iii) of this subpara3 graph, in any year during which the arithmetic aver4 age of the closing prices on the New York Mercantile

5 Exchange for natural gas exceeds $3.50 per million

6 British thermal units, any production of natural gas

7 will be subject to royalties at the lease stipulated roy8 alty rate. Any production subject to this clause shall

9 be counted toward the production volume determined

10 pursuant to clauses (ii) or (iii). Estimated royalty

11 payments will be made if such average of the closing

12 prices for the previous year exceeds $3.50. After the

13 end of the calendar year, when the new average price

14 can be calculated, lessees will pay any royalties due,

15 with interest but without penalty, or can apply for a

16 refund, with interest, of any overpayment.

17 ‘‘(vii) The prices referred to in clauses (v) and

18 (vi) of this subparagraph shall be changed during any

19 calendar year after 1994 by the percentage, if any, by

20 which the implicit price deflator for the gross domes21 tic product changed during the preceding calendar

22 year.’’.
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1 SEC. 5931. NEW LEASES.

2 (a) AMENDMENTS.—Section 8(a)(1) of the Outer Con3 tinental Shelf Lands Act (43 U.S.C. 1337(a)(1)) is amended

4 as follows:

5 (1) Redesignate section 8(a)(1)(H) as section

6 8(a)(1)(I);

7 (2) Add a new section 8(a)(1)(H) as follows:

8 ‘‘(H) cash bonus bid with royalty at no less

9 than 12 and 1/2 per centum fixed by the Sec10 retary in amount or value of production saved,

11 removed, or sold, and with suspension of royal12 ties for a period, volume, or value of production

13 determined by the Secretary. Such suspensions

14 may vary based on the price of production from

15 the lease.’’.

16 (b) PRODUCTION.—For all tracts located in water

17 depths of 200 meters or greater in the Western and Central

18 Planning Ares of the Gulf of Mexico, including that portion

19 of the Eastern Planning Area of the Gulf of Mexico encom20 passing whole lease blocks lying west of 87 degrees, 30 min21 utes West longitude, any lease sale within seven years of

22 the date of enactment of this Act, shall use the bidding sys23 tem authorized in section 8(a)(1)(H) of the Outer Continen24 tal Shelf Lands Act, as amended by this Act, except that

25 the suspension of royalties shall be set at a volume of not

26 less than the following:
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1 (1) 17.5 million barrels of oil equivalent for

2 leases in water depths of 200 to 400 meters;

3 (2) 52.5 million barrels of oil equivalent for

4 leases in 400 to 800 meters of water; and

5 (3) 87.5 million barrels of oil equivalent for

6 leases in water depths greater than 800 meters.

7 SEC. 5932. REGULATIONS.

8 The Secretary shall promulgate such rules and regula9 tions as are necessary to implement the provisions of this

10 Act within 180 days after the enactment of this Act.

11 TITLE VI—COMMITTEE ON ENVI12 RONMENT AND PUBLIC

13 WORKS

14 SEC. 6001. SHORT TITLE; TABLE OF CONTENTS.

15 (a) SHORT TITLE.—This title may be cited as the

16 ‘‘Public Works Reconciliation Act of 1995’’.

17 (b) TABLE OF CONTENTS.—The table of contents of this

18 title is as follows:

Sec. 6001. Short title; table of contents.

Sec. 6002. Highway demonstration projects.

Sec. 6003. Technical correction concerning minimum allocation.

Sec. 6004. Nuclear Regulatory Commission annual charges.

Sec. 6005. Radiological emergency preparedness fees.

19 SEC. 6002. HIGHWAY DEMONSTRATION PROJECTS.

20 (a) PROJECTS AUTHORIZED FOR FISCAL YEARS 1996

21 AND 1997.—

22 (1) REDUCTIONS.—Subject to paragraph (2),

23 notwithstanding any other law, for each of fiscal
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1 years 1996 and 1997 and with respect to each State,

2 the total of the amounts authorized, allocated, or

3 unallocated to the State for highway demonstration

4 projects under sections 1103 through 1108 of the

5 Intermodal Surface Transportation Efficiency Act of

6 1991 (Public Law 102–240; 105 Stat. 2027) shall be

7 reduced by 15 percent.

8 (2) ORDER OF REDUCTIONS.—For fiscal year

9 1996, the reductions required by paragraph (1) shall

10 be made after any reduction required for the fiscal

11 year under section 1003(c) of the Act (Public Law

12 102–240; 105 Stat. 1921).

13 (b) PROJECTS PREVIOUSLY AUTHORIZED UNDER CER14 TAIN TRANSPORTATION LAWS.—

15 (1) REDUCTIONS.—Subject to paragraph (2),

16 notwithstanding any other law, with respect to each

17 State, the total unobligated balance as of September

18 30, 1995, of the amounts authorized, allocated,

19 unallocated, or otherwise provided to the State for

20 highway demonstration projects under all of the fol21 lowing laws shall be reduced by 15 percent:

22 (A) For each of fiscal years 1992 through

23 1995, sections 1103 through 1108 of the Inter24 modal Surface Transportation Efficiency Act of

25 1991 (Public Law 102–240; 105 Stat. 2027).
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1 (B) Section 149 of the Surface Transpor2 tation and Uniform Relocation Assistance Act of

3 1987 (Public Law 100–17; 101 Stat. 181).

4 (C) Section 131 of the Surface Transpor5 tation Assistance Act of 1982 (Public Law 97–

6 424; 96 Stat. 2119).

7 (2) EFFECT ON OTHER REDUCTIONS.—A reduc8 tion under paragraph (1) made with respect to a law

9 described in paragraph (1)(A) shall not affect any re10 duction required for a fiscal year under section

11 1003(c) of the Intermodal Surface Transportation Ef12 ficiency Act of 1991 (Public Law 102–240; 105 Stat.

13 1921).

14 SEC. 6003. TECHNICAL CORRECTION CONCERNING MINI15 MUM ALLOCATION.

16 (a) FINDINGS.—Congress finds that—

17 (1) under the amendments made by section

18 1013(a) of the Intermodal Surface Transportation Ef19 ficiency Act of 1991 (Public Law 102–240; 105 Stat.

20 1940), each State receives back from the Federal-aid

21 highway program not less than 90 percent of the

22 State’s percentage of all contributions to the Highway

23 Account of the Highway Trust Fund established by

24 section 9503 of the Internal Revenue Code of 1986;
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1 (2) for fiscal year 1995, the amount apportioned

2 under section 157(a)(4) of title 23, United States

3 Code, was $1,427,000,000;

4 (3) in fiscal year 1996, the Interstate construc5 tion program under the title will be terminated and

6 replaced with a new reimbursement program; and

7 (4) as a result of the termination of the Inter8 state construction program, the number of States re9 ceiving funds under section 157(a)(4) of the title for

10 fiscal year 1996 may decrease and the amount of

11 funds some States will require will decrease, and,

12 therefore, the amount of funds necessary to ensure

13 that each State receives not less than 90 percent will

14 be reduced from $1,427,000,000 to an estimated

15 $565,000,000.

16 (b) CORRECTION.—

17 (1) IN GENERAL.—With respect to the first fiscal

18 year beginning after September 30, 1995—

19 (A) the Secretary of Transportation shall

20 determine, in accordance with the policies estab21 lished by the Intermodal Surface Transportation

22 Efficiency Act of 1991 (Public Law 102–240;

23 105 Stat. 1914)—

24 (i) which of the States will no longer

25 require an apportionment under section
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1 157(a)(4) of title 23, United States Code;

2 and

3 (ii) which of the States will require de4 creased funding under section 157(a)(4) of

5 the title;

6 as a result of the termination of the Interstate

7 construction program; and

8 (B) as a result of the reduced number of

9 States that may require an apportionment under

10 section 157(a)(4) of the title, and the decrease in

11 the amount of funds some States will require

12 under section 157(a)(4) of the title, the amount

13 apportioned under section 157(a)(4) of the title

14 shall be reduced from the amount apportioned

15 for fiscal year 1995 by 60.4 percent.

16 (2) EFFECT ON CERTAIN CALCULATIONS.—The

17 correction made by paragraph (1) shall not be taken

18 into account in making the calculations required

19 under sections 1003(c), 1013(c), and 1015 of the

20 Intermodal Surface Transportation Efficiency Act of

21 1991 (Public Law 102–240; 105 Stat. 1921, 1940,

22 and 1943).
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1 SEC. 6004. NUCLEAR REGULATORY COMMISSION ANNUAL

2 CHARGES.

3 Section 6101(a)(3) of the Omnibus Budget Reconcili4 ation Act of 1990 (42 U.S.C. 2214(a)(3)) is amended by

5 striking ‘‘September 30, 1998’’ and inserting ‘‘September

6 30, 2005’’.

7 SEC. 6005. RADIOLOGICAL EMERGENCY PREPAREDNESS

8 FEES.

9 The first paragraph of the matter under the heading

10 ‘‘ADMINISTRATIVE PROVISIONS’’ under the heading ‘‘FED11 ERAL EMERGENCY MANAGEMENT AGENCY’’ in title III of

12 the Departments of Veterans Affairs and Housing and

13 Urban Development, and Independent Agencies Appropria14 tions Act, 1995 (Public Law 103–327; 108 Stat. 2325), is

15 amended—

16 (1) in the first and second sentences, by striking

17 ‘‘fiscal year 1995’’ each place it appears and insert18 ing ‘‘each of fiscal years 1995 through 2005’’; and

19 (2) in the last sentence, by striking ‘‘only author20 ized during fiscal year 1995’’ and inserting ‘‘author21 ized only during fiscal years 1995 through 2005’’.
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1 TITLE VII—COMMITTEE ON FI2 NANCE—SPENDING CONTROL

3 PROVISIONS

4 SEC. 7000. REFERENCES; TABLE OF CONTENTS.

5 (a) AMENDMENTS TO SOCIAL SECURITY ACT.—Except

6 as otherwise specifically provided, whenever in subtitles A

7 through G of this title an amendment is expressed in terms

8 of an amendment to or repeal of a section or other provi9 sion, the reference shall be considered to be made to that

10 section or other provision of the Social Security Act.

11 (b) REFERENCES TO OBRA.—In this title, the terms

12 ‘‘OBRA–1986’’, ‘‘OBRA–1987’’, ‘‘OBRA–1990’’, and

13 ‘‘OBRA–1993’’ refer to the Omnibus Budget Reconciliation

14 Act of 1986 (Public Law 99–509), the Omnibus Budget Rec15 onciliation Act of 1987 (Public Law 100–203), the Omnibus

16 Budget Reconciliation Act of 1989 (Public Law 101–239),

17 the Omnibus Budget Reconciliation Act of 1990 (Public

18 Law 101–508), and the Omnibus Budget Reconciliation Act

19 of 1993 (Public Law 103–66), respectively.

20 (c) TABLE OF CONTENTS OF SUBTITLES A THROUGH

21 J.—The table of contents of subtitles A through J of this

22 title is as follows:

TITLE VII—COMMITTEE ON FINANCE—SPENDING CONTROL

PROVISIONS

Sec. 7000. References; table of contents.
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Subtitle A—Medicare

CHAPTER 1—MEDICARE CHOICE PLANS

SUBCHAPTER A—ESTABLISHMENT OF MEDICARE CHOICE PLANS

Sec. 7001. Medicare choice plans.

Sec. 7002. Treatment of 1876 organizations.

Sec. 7003. Special rule for calculation of payment rates for 1996.

SUBCHAPTER B—TAX PROVISIONS RELATING TO MEDICARE CHOICE PLANS

Sec. 7006. Medicare Choice Accounts.

Sec. 7007. Certain rebates included in gross income.

CHAPTER 2—PROVISIONS RELATING TO PART A

SUBCHAPTER A—GENERAL PROVISIONS RELATING TO PART A

Sec. 7011. PPS hospital payment update.

Sec. 7012. PPS-exempt hospital payments.

Sec. 7013. Capital payments for PPS hospitals.

Sec. 7014. Disproportionate share hospital payments.

Sec. 7015. Indirect medical education payments.

Sec. 7016. Graduate medical education and disproportionate share payment adjustments for medicare choice.

Sec. 7017. Payments for hospice services.

Sec. 7018. Extending medicare coverage of, and application of hospital insurance

tax to, all State and local government employees.

Sec. 7019. Nurse aide training in skilled nursing facilities subject to extended

survey and certain other conditions.

SUBCHAPTER B—PAYMENTS TO SKILLED NURSING FACILITIES

PART I—PROSPECTIVE PAYMENT SYSTEM

Sec. 7025. Prospective payment system for skilled nursing facilities.

PART II—INTERIM PAYMENT SYSTEM

Sec. 7031. Payments for routine service costs.

Sec. 7032. Cost-effective management of covered non-routine services.

Sec. 7033. Payments for routine service costs.

Sec. 7034. Reductions in payment for capital-related costs.

Sec. 7035. Treatment of items and services paid for under part B.

Sec. 7036. Medical review process.

Sec. 7037. Revised salary equivalence limits.

Sec. 7038. Report by Prospective Payment Assessment Commission.

Sec. 7039. Effective date.

CHAPTER 3—PROVISIONS RELATING TO PART B

Sec. 7041. Payments for physicians’ services.

Sec. 7042. Elimination of formula-driven overpayments for certain outpatient

hospital services.

Sec. 7043. Payment for clinical laboratory diagnostic services.

Sec. 7044. Durable medical equipment.

Sec. 7045. Updates for orthotics and prosthetics.

Sec. 7046. Payments for capital-related costs of outpatient hospital services.
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Sec. 7047. Payments for non-capital costs of outpatient hospital services.

Sec. 7048. Updates for ambulatory surgical services.

Sec. 7049. Payment for ambulance services.

Sec. 7050. Physician supervision of nurse anesthetists.

Sec. 7051. Part B deductible.

Sec. 7052. Part B premium.

Sec. 7053. Increase in medicare part B premium for high income individuals.

CHAPTER 4—PROVISIONS RELATING TO PARTS A AND B

SUBCHAPTER A—GENERAL PROVISIONS RELATING TO PARTS A AND B

Sec. 7055. Secondary payor provisions.

Sec. 7056. Treatment of assisted suicide.

Sec. 7057. Administrative provisions.

Sec. 7058. Sense of Senate regarding coverage for treatment of breast and prostate

cancer under medicare.

SUBCHAPTER B—PAYMENTS FOR HOME HEALTH SERVICES

Sec. 7061. Payment for home health services.

Sec. 7062. Maintaining savings resulting from temporary freeze on payment increases for home health services.

Sec. 7063. Extension of waiver of presumption of lack of knowledge of exclusion

from coverage for home health agencies.

CHAPTER 5—RURAL AREAS

Sec. 7071. Medicare-dependent, small, rural hospital payment extension.

Sec. 7072. Medicare rural hospital flexibility program.

Sec. 7073. Establishment of rural emergency access care hospitals.

Sec. 7074. Additional payments for physicians’ services furnished in shortage

areas.

Sec. 7075. Payments to physician assistants and nurse practitioners for services

furnished in outpatient or home settings.

Sec. 7076. Demonstration projects to promote telemedicine.

Sec. 7077. PROPAC recommendations on urban medicare dependent hospitals.

CHAPTER 6—HEALTH CARE FRAUD AND ABUSE PREVENTION

Sec. 7100. Short title.

SUBCHAPTER A—FRAUD AND ABUSE CONTROL PROGRAM

Sec. 7101. Fraud and abuse control program.

Sec. 7102. Application of certain health anti-fraud and abuse sanctions to fraud

and abuse against Federal health programs.

Sec. 7103. Health care fraud and abuse guidance.

SUBCHAPTER B—REVISIONS TO CURRENT SANCTIONS FOR FRAUD AND ABUSE

Sec. 7111. Mandatory exclusion from participation in medicare and State health

care programs.

Sec. 7112. Establishment of minimum period of exclusion for certain individuals

and entities subject to permissive exclusion from medicare and

State health care programs.

Sec. 7113. Permissive exclusion of individuals with ownership or control interest

in sanctioned entities.
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Sec. 7114. Sanctions against practitioners and persons for failure to comply with

statutory obligations.

Sec. 7115. Intermediate sanctions for medicare health maintenance organizations.

Sec. 7116. Clarification of and additions to exceptions to anti-kickback penalties.

Sec. 7117. Effective date.

SUBCHAPTER C—ADMINISTRATIVE AND MISCELLANEOUS PROVISIONS

Sec. 7121. Establishment of the health care fraud and abuse data collection program.

Sec. 7122. Elimination of reasonable cost reimbursement for certain legal fees.

SUBCHAPTER D—CIVIL MONETARY PENALTIES

Sec. 7131. Social Security Act civil monetary penalties.

SUBCHAPTER E—AMENDMENTS TO CRIMINAL LAW

Sec. 7141. Health care fraud.

Sec. 7142. Forfeitures for Federal health care offenses.

Sec. 7143. Injunctive relief relating to Federal health care offenses.

Sec. 7144. Grand jury disclosure.

Sec. 7145. False statements.

Sec. 7146. Obstruction of criminal investigations of Federal health care offenses.

Sec. 7147. Theft or embezzlement.

Sec. 7148. Laundering of monetary instruments.

Sec. 7149. Authorized investigative demand procedures.

SUBCHAPTER F—STATE HEALTH CARE FRAUD CONTROL UNITS

Sec. 7151. State health care fraud control units.

Sec. 7152. Beneficiary incentive programs.

CHAPTER 7—OTHER PROVISIONS FOR TRUST FUND SOLVENCY

Sec. 7171. Nondischargeability of certain medicare debts.

Sec. 7172. Transfers of certain part B savings to hospital insurance trust fund.

Subtitle B—Transformation of the Medicaid Program

Sec. 7190. Short title.

Sec. 7191. Transformation of medicaid program.

Sec. 7192. Medicaid drug rebate program.

Sec. 7193. Waivers.

Sec. 7194. Children with special health care needs.

Sec. 7195. CBO reports.

Sec. 7196. Adjustments of pool amounts.

Sec. 7197. State review of mentally ill or retarded nursing facility residents upon

change in physical or mental condition.

Sec. 7198. Nurse aide training in nursing facilities subject to extended survey

and under certain other conditions.

Sec. 7199. Nurse aide training in nursing facilities subject to extended survey

and under certain other conditions.

Subtitle C—Block Grants for Temporary Assistance for Needy Families

Sec. 7200. Short title.

Sec. 7201. Block grants to States.

Sec. 7202. Limitations on use of funds for certain purposes.
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Sec. 7203. Census data on grandparents as primary caregivers for their grandchildren.

Sec. 7204. Study of effect of welfare reform on grandparents as primary

caregivers.

Sec. 7205. Development of prototype of counterfeit-resistant social security card

required.

Sec. 7206. Modifications to the job opportunities for certain low-income individuals program.

Sec. 7207. Demonstration projects for school utilization.

Sec. 7208. Corrective compliance plan.

Sec. 7209. Parental responsibility contracts.

Sec. 7210. Expenditure of Federal funds in accordance with laws and procedures

applicable to expenditure of State funds.

Sec. 7211. Conforming amendments to the Social Security Act.

Sec. 7212. Conforming amendments to the Food Stamp Act of 1977 and related

provisions.

Sec. 7213. Conforming amendments to other laws.

Sec. 7214. Secretarial submission of legislative proposal for technical and conforming amendments.

Sec. 7215. Effective date; transition rule.

Subtitle D—Supplemental Security Income

CHAPTER 1—ELIGIBILITY RESTRICTIONS

Sec. 7251. Denial of supplemental security income benefits by reason of disability

to drug addicts and alcoholics.

Sec. 7252. Denial of SSI benefits for 10 years to individuals found to have fraudulently misrepresented residence in order to obtain benefits simultaneously in 2 or more States.

Sec. 7253. Denial of SSI benefits for fugitive felons and probation and parole violators.

Sec. 7254. Effective dates; application to current recipients.

CHAPTER 2—BENEFITS FOR DISABLED CHILDREN

Sec. 7261. Definition and eligibility rules.

Sec. 7262. Eligibility redeterminations and continuing disability reviews.

Sec. 7263. Additional accountability requirements.

CHAPTER 3—STUDIES REGARDING SUPPLEMENTAL SECURITY INCOME

PROGRAM

Sec. 7271. Annual report on the supplemental security income program.

Sec. 7272. Improvements to disability evaluation.

Sec. 7273. Study of disability determination process.

Sec. 7274. Study by General Accounting Office.

CHAPTER 4—NATIONAL COMMISSION ON THE FUTURE OF DISABILITY

Sec. 7281. Establishment.

Sec. 7282. Duties of the Commission.

Sec. 7283. Membership.

Sec. 7284. Staff and support services.

Sec. 7285. Powers of Commission.

Sec. 7286. Reports.

Sec. 7287. Termination.
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Subtitle E—Child Support

CHAPTER 1—ELIGIBILITY FOR SERVICES; DISTRIBUTION OF PAYMENTS

Sec. 7301. State obligation to provide child support enforcement services.

Sec. 7302. Distribution of child support collections.

Sec. 7303. Rights to notification and hearings.

Sec. 7304. Privacy safeguards.

CHAPTER 2—LOCATE AND CASE TRACKING

Sec. 7311. State case registry.

Sec. 7312. Collection and disbursement of support payments.

Sec. 7313. State directory of new hires.

Sec. 7314. Amendments concerning income withholding.

Sec. 7315. Locator information from interstate networks.

Sec. 7316. Expansion of the Federal parent locator service.

Sec. 7317. Collection and use of social security numbers for use in child support

enforcement.

CHAPTER 3—STREAMLINING AND UNIFORMITY OF PROCEDURES

Sec. 7321. Adoption of uniform State laws.

Sec. 7322. Improvements to full faith and credit for child support orders.

Sec. 7323. Administrative enforcement in interstate cases.

Sec. 7324. Use of forms in interstate enforcement.

Sec. 7325. State laws providing expedited procedures.

CHAPTER 4—PATERNITY ESTABLISHMENT

Sec. 7331. State laws concerning paternity establishment.

Sec. 7332. Outreach for voluntary paternity establishment.

Sec. 7333. Cooperation by applicants for and recipients of temporary family assistance.

CHAPTER 5—PROGRAM ADMINISTRATION AND FUNDING

Sec. 7341. Performance-based incentives and penalties.

Sec. 7342. Federal and State reviews and audits.

Sec. 7343. Required reporting procedures.

Sec. 7344. Automated data processing requirements.

Sec. 7345. Technical assistance.

Sec. 7346. Reports and data collection by the Secretary.

CHAPTER 6—ESTABLISHMENT AND MODIFICATION OF SUPPORT ORDERS

Sec. 7351. National Child Support Guidelines Commission.

Sec. 7352. Simplified process for review and adjustment of child support orders.

Sec. 7353. Furnishing consumer reports for certain purposes relating to child

support.

Sec. 7354. Nonliability for depository institutions providing financial records to

State child support enforcement agencies in child support cases.

CHAPTER 7—ENFORCEMENT OF SUPPORT ORDERS

Sec. 7361. Internal Revenue Service collection of arrearages.

Sec. 7362. Authority to collect support from Federal employees.
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Sec. 7363. Enforcement of child support obligations of members of the armed

forces.

Sec. 7364. Voiding of fraudulent transfers.

Sec. 7365. Work requirement for persons owing child support.

Sec. 7366. Definition of support order.

Sec. 7367. Reporting arrearages to credit bureaus.

Sec. 7368. Liens.

Sec. 7369. State law authorizing suspension of licenses.

Sec. 7370. Denial of passports for nonpayment of child support.

Sec. 7371. International child support enforcement.

Sec. 7372. Denial of means-tested Federal benefits to noncustodial parents who

are delinquent in paying child support.

Sec. 7373. Child support enforcement for Indian tribes.

Sec. 7374. Financial institution data matches.

Sec. 7375. Enforcement of orders against paternal grandparents in cases of minor

parents.

Sec. 7376. Sense of the Senate regarding the inability of the non-custodial parent

to pay child support.

CHAPTER 8—MEDICAL SUPPORT

Sec. 7378. Technical correction to ERISA definition of medical child support

order.

Sec. 7379. Enforcement of orders for health care coverage.

CHAPTER 9—ENHANCING RESPONSIBILITY AND OPPORTUNITY FOR

NONRESIDENTIAL PARENTS

Sec. 7381. Grants to States for access and visitation programs.

CHAPTER 10—EFFECT OF ENACTMENT

Sec. 7391. Effective dates.

Subtitle F—Noncitizens

Sec. 7401. State option to prohibit assistance for certain aliens.

Sec. 7402. Deemed income requirement for Federal and federally funded programs.

Sec. 7403. Requirements for sponsor’s affidavit of support.

Sec. 7404. Limited eligibility of noncitizens for SSI benefits.

Sec. 7405. Treatment of noncitizens.

Sec. 7406. Information reporting.

Sec. 7407. Prohibition on payment of Federal benefits to certain persons.

Subtitle G—Additional Provisions Relating To Welfare Reform

CHAPTER 1—REDUCTIONS IN FEDERAL GOVERNMENT POSITIONS

Sec. 7411. Reductions.

Sec. 7412. Reducing personnel in Washington, D.C. area.

CHAPTER 2—BLOCK GRANT FOR SOCIAL SERVICES.

Sec. 7421. Reduction in block grant for social services.

Sec. 7422. Establishing national goals to prevent teenage pregnancies.
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CHAPTER 3—FOSTER CARE MAINTENANCE PAYMENTS PROGRAM

Sec. 7431. Limitation on growth of administrative expenses for foster care maintenance payments program.

CHAPTER 4—MISCELLANEOUS PROVISIONS

Sec. 7441. Exemption of battered individuals from certain requirements.

Sec. 7442. Sense of the Senate on legislative accountability for unfunded mandates in welfare reform legislation.

Sec. 7443. Sense of the Senate regarding enforcement of statutory rape laws.

Sec. 7444. Sanctioning for testing positive for controlled substances.

Sec. 7445. Fraud under means-tested welfare and public assistance programs.

Subtitle H—Reform of the Earned Income Tax Credit

Sec. 7460. Amendment of 1986 code.

Sec. 7461. Earned income credit denied to individuals not authorized to be employed in the United States.

Sec. 7462. Repeal of earned income credit for individuals without children.

Sec. 7463. Modification of earned income credit amount and phaseout.

Sec. 7464. Rules relating to denial of earned income credit on basis of disqualified income.

Sec. 7465. Modification of adjusted gross income definition for earned income

credit.

Sec. 7466. Provisions to improve tax compliance.

Subtitle I—Increase in Public Debt Limit

Sec. 7471. Increase in public debt limit.

1 Subtitle A—Medicare

2 CHAPTER 1—MEDICARE CHOICE PLANS

3 Subchapter A—Establishment of Medicare

4 Choice Plans

5 SEC. 7001. MEDICARE CHOICE PLANS.

6 (a) Title XVIII of the Social Security Act (42 U.S.C.

7 1395 et seq.) is amended by adding at the end the following

8 new part:

9 ‘‘PART D—MEDICARE CHOICE PLANS

‘‘SUBPART 1—DEFINITIONS

‘‘Sec. 1895A. Definitions.
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‘‘SUBPART 2—ENTITLEMENT OF MEDICARE CHOICE ELIGIBLE INDIVIDUALS TO

HEALTH CARE CHOICES

‘‘Sec. 1895B. Entitlement to medicare choices.

‘‘Sec. 1895C. Enrollment procedures.

‘‘Sec. 1895D. Effect of enrollment.

‘‘SUBPART 3—MEDICARE CHOICE PLAN REQUIREMENTS

‘‘Sec. 1895G. Availability and enrollment.

‘‘Sec. 1895H. Benefits provided to individuals.

‘‘Sec. 1895I. Licensing and financial requirements.

‘‘Sec. 1895J. Health plan standards.

‘‘SUBPART 4—DETERMINATION OF MEDICARE PAYMENT AMOUNTS AND REBATES

‘‘Sec. 1895M. Medicare payment amounts.

‘‘Sec. 1895N. Premiums and rebates.

‘‘Sec. 1895O. Payments to plan sponsors.

‘‘SUBPART 5—CONTRACTUAL AUTHORITY; TEMPORARY CERTIFICATION;

REGULATIONS

‘‘Sec. 1895P. General permission to contract.

‘‘Sec. 1895Q. Renewal and termination of contract.

‘‘Sec. 1895R. Temporary certification process for coordinated care plans.

‘‘Sec. 1895S. Regulations.

1 ‘‘Subpart 1—Definitions

2 ‘‘SEC. 1895A. DEFINITIONS.

3 ‘‘(a) MEDICARE CHOICE PLAN.—In this part—

4 ‘‘(1) IN GENERAL.—The term ‘medicare choice

5 plan’ means an eligible health plan with respect to

6 which there is a contract in effect under this part to

7 provide health benefits coverage to medicare choice eli8 gible individuals.

9 ‘‘(2) MEDICARE CHOICE PLAN SPONSOR.—The

10 terms ‘medicare choice plan sponsor’ and ‘plan spon11 sor’ mean a public or private entity which establishes

12 or maintains a medicare choice plan.

13 ‘‘(b) TERMS RELATING TO HEALTH PLANS.—In this

14 part:
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1 ‘‘(1) ELIGIBLE HEALTH PLAN.—

2 ‘‘(A) IN GENERAL.—The term ‘eligible

3 health plan’ means a policy, contract, or plan

4 which is capable of providing health benefits cov5 erage of items and services provided under the

6 traditional medicare program to medicare choice

7 eligible individuals.

8 ‘‘(B) TYPES OF INSURANCE.—The term ‘eli9 gible health plan’ shall include any of the follow10 ing types of plans of health insurance:

11 ‘‘(i) INDEMNITY OR FEE-FOR-SERVICE

12 PLANS.—Private indemnity plans that re13 imburse hospitals, physicians, and other

14 providers on the basis of a privately deter15 mined fee schedule.

16 ‘‘(ii) COORDINATED CARE PLANS.—

17 Private managed or coordinated care plans

18 which provide health care services through

19 an integrated network of providers, includ20 ing—

21 ‘‘(I) qualified health maintenance

22 organizations as defined in section

23 1310(d) of the Public Health Service

24 Act; and
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1 ‘‘(II) preferred provider organiza2 tion plans, point of service plans, pro3 vider-sponsored network plans, or other

4 coordinated care plans.

5 ‘‘(iii) OTHER HEALTH CARE PLANS.—

6 Any other private plan for the delivery of

7 health care items and services that is not

8 described in clause (i), or (ii).

9 ‘‘(2) UNION OR ASSOCIATION PLAN.—

10 ‘‘(A) IN GENERAL.—The term ‘union or as11 sociation plan’ means an eligible health plan

12 with a union sponsor, a Taft-Hartley sponsor, or

13 a qualified association sponsor that—

14 ‘‘(i) is organized for purposes other

15 than to market a health plan;

16 ‘‘(ii) may not condition its member17 ship on health status, health claims experi18 ence, receipt of health care, medical history,

19 or lack of evidence of insurability of a po20 tential member;

21 ‘‘(iii) may not exclude a member or

22 spouse of a member from health plan cov23 erage based on factors described in clause

24 (ii);
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1 ‘‘(iv) is a permanent entity which re2 ceives a substantial majority of its financial

3 support from active members; and

4 ‘‘(v) may not be owned or controlled by

5 an insurance company.

6 ‘‘(B) UNION SPONSOR.—The term ‘union

7 sponsor’ means an employee organization that

8 establishes or maintains an eligible health plan

9 other than pursuant to a collective bargaining

10 agreement.

11 ‘‘(C) TAFT-HARTLEY SPONSOR.—The term

12 ‘Taft-Hartley sponsor’ means, with respect to a

13 group health plan established or maintained by

14 2 or more employees or jointly by 1 or more em15 ployees and 1 or more employee organizations,

16 the association, committee, joint board of trust17 ees, or other similar group of representatives of

18 parties who establish or maintain the plan.

19 ‘‘(D) QUALIFIED ASSOCIATION SPONSOR.—

20 The term ‘qualified association sponsor’ means

21 an association, religious fraternal organization,

22 or other organization (which may be a trade, in23 dustry, or professional association, a chamber of

24 commerce, or a public entity association) which

25 establishes or maintains an eligible health plan.
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1 ‘‘(E) TERMS.—In this paragraph, the terms

2 ‘employee’, ‘employee organization’, and ‘group

3 health plan’ have the meanings given such terms

4 for purposes of part 6 of subtitle B of title I of

5 the Employee Retirement Income Security Act of

6 1974.

7 ‘‘(c) OTHER DEFINITIONS.—In this part:

8 ‘‘(1) AREAS.—

9 ‘‘(A) MEDICARE PAYMENT AREA.—

10 ‘‘(i) IN GENERAL.—Except as provided

11 in clause (ii), the term ‘medicare payment

12 area’ means—

13 ‘‘(I) a metropolitan statistical

14 area (whether or not such area is in a

15 single State) or in the case of a con16 solidated metropolitan statistical area,

17 each primary metropolitan statistical

18 area within the consolidated area; or

19 ‘‘(II) one area within each State

20 composed of all areas that do not fall

21 within a metropolitan statistical area.

22 ‘‘(ii) GEOGRAPHIC ADJUSTMENT.—

23 Upon request of a State, the Secretary may

24 make a geographic adjustment to a medi-
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1 care payment area otherwise determined

2 under clause (i).

3 ‘‘(iii) AREAS.—In this subparagraph,

4 the terms ‘metropolitan statistical area’,

5 ‘consolidated metropolitan statistical area’,

6 and ‘primary metropolitan statistical area’

7 mean any area designated as such by the

8 Secretary of Commerce.

9 ‘‘(B) MEDICARE SERVICE AREA.—

10 ‘‘(i) IN GENERAL.—Except as provided

11 in clause (ii), the term ‘medicare service

12 area’ means a medicare payment area.

13 ‘‘(ii) GEOGRAPHIC ADJUSTMENT.—The

14 Secretary may designate a medicare service

15 area other than a medicare payment area

16 for a medicare choice plan if the Secretary

17 determines that such designation would not

18 result in the enrollment of enrollees in the

19 plan in such area which are substantially

20 nonrepresentative, as determined in accord21 ance with regulations of the Secretary, of

22 the population in the medicare payment

23 area.

24 ‘‘(2) MEDICARE CHOICE ELIGIBLE INDIVIDUAL.—
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1 ‘‘(A) IN GENERAL.—The term ‘medicare

2 choice eligible individual’ means an individual

3 who is entitled to benefits under part A and en4 rolled under part B.

5 ‘‘(B) SPECIAL RULE FOR END-STAGE RENAL

6 DISEASE.—Such term shall not include an indi7 vidual medically determined to have end-stage

8 renal disease, except that an individual who de9 velops end-stage renal disease while enrolled in a

10 medicare choice plan may continue to be enrolled

11 in that plan. Not later than December 31, 1999,

12 the Secretary shall submit to the Congress rec13 ommendations on expanding the definition of

14 ‘medicare choice eligible individual’ to include

15 individuals with end-stage renal disease and the

16 enrollment of such individuals in medicare

17 choice plans.

18 ‘‘(3) TRADITIONAL MEDICARE PROGRAM.—The

19 term ‘traditional medicare program’ means the pro20 gram of benefits available to individuals entitled to

21 benefits under part A and enrolled under part B of

22 this title, other than enrollment in a medicare choice

23 plan under this part.
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1 ‘‘Subpart 2—Entitlement of Medicare Choice Eligible

2 Individuals to Health Care Choices

3 ‘‘SEC. 1895B. ENTITLEMENT TO MEDICARE CHOICES.

4 ‘‘Each medicare choice eligible individual is entitled

5 to choose to receive health care items and services covered

6 under parts A and B—

7 ‘‘(1) through the traditional medicare program;

8 or

9 ‘‘(2) by receiving payments toward the individ10 ual’s enrollment in a medicare choice plan under this

11 part.

12 ‘‘SEC. 1895C. ENROLLMENT PROCEDURES.

13 ‘‘(a) IN GENERAL.—Except as provided in section

14 1895G(a)(2), each medicare choice eligible individual shall

15 be entitled to enroll in any medicare choice plan with a

16 medicare service area including the geographic area in

17 which the individual resides during—

18 ‘‘(1) the annual open enrollment period described

19 in section 1895G(b)(1); or

20 ‘‘(2) any other enrollment period described in

21 section 1895G(b)(2) applicable to the individual.

22 ‘‘(b) METHOD OF ENROLLMENT AND

23 DISENROLLMENT.—

24 ‘‘(1) NOTICE PROVIDED TO THE SECRETARY.—

25 Each medicare choice eligible individual desiring to

26 enroll or terminate enrollment in a medicare choice
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1 plan shall provide the Secretary with notice of such

2 enrollment or disenrollment during any enrollment

3 period applicable to the individual. The Secretary

4 shall, to the extent feasible, provide for the receipt of

5 such notice by telephone, through the mail, and in

6 person at local social security offices.

7 ‘‘(2) INFORMATION FORWARDED TO THE PLAN.—

8 The Secretary shall promptly provide each medicare

9 choice plan with notice of an individual’s enrollment

10 or disenrollment with the plan.

11 ‘‘(c) NOTICES TO INDIVIDUALS TO ASSIST IN ENROLL12 MENT.—

13 ‘‘(1) OPEN SEASON NOTIFICATION.—

14 ‘‘(A) MAILING OF NOTICE.—By September

15 30 of each year beginning after 1995, the Sec16 retary shall mail a notice of eligibility to each

17 medicare choice eligible individual and each in18 dividual entitled to benefits under part A prior

19 to the end of the annual open enrollment period

20 described in section 1895G(b)(1).

21 ‘‘(B) NOTICE DESCRIBED.—The notice de22 scribed in subparagraph (A) shall include an in23 formational brochure that includes the informa24 tion described in this section, and any other in-
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1 formation that the Secretary determines will as2 sist the individual’s enrollment decision.

3 ‘‘(2) NOTIFICATION TO NEWLY MEDICARE CHOICE

4 ELIGIBLE INDIVIDUALS.—With respect to an individ5 ual who becomes eligible to enroll in a medicare

6 choice plan during the period described in section

7 1895G(b)(2)(A) and to whom paragraph (1) does not

8 apply, the Secretary shall, not later than 2 months

9 before the date on which the individual becomes eligi10 ble, mail to the individual the notice of eligibility de11 scribed in paragraph (1).

12 ‘‘(d) SECRETARY’S MATERIALS; CONTENTS.—The no13 tice and informational materials mailed by the Secretary

14 under subsection (c) shall be written and formatted in the

15 most easily understandable manner possible, and shall in16 clude, at a minimum, the following:

17 ‘‘(1) GENERAL INFORMATION.—General informa18 tion with respect to coverage under this part during

19 the next calendar year, including—

20 ‘‘(A) the part B premium rates that will be

21 charged for part B coverage,

22 ‘‘(B) the deductible, copayment, and coin23 surance amounts for coverage under the tradi24 tional medicare program,
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1 ‘‘(C) a description of the coverage under the

2 traditional medicare program and any changes

3 in coverage under the program from the prior

4 year,

5 ‘‘(D) a description of the individual’s medi6 care payment area, and the standardized medi7 care payment amount available with respect to

8 such individual,

9 ‘‘(E) information and instructions on how

10 to enroll in a medicare choice plan,

11 ‘‘(F) the right of each medicare choice plan

12 sponsor by law to terminate or refuse to renew

13 its contract and the effect the termination or

14 nonrenewal of its contract may have on individ15 uals enrolled with the medicare choice plan

16 under this part, and

17 ‘‘(G) to the extent available, quality indica18 tors for the traditional medicare program and

19 each medicare choice plan, including—

20 ‘‘(i) disenrollment rates for medicare

21 enrollees for the previous 2 years (excluding

22 disenrollment due to death or moving out23 side the plan’s medicare service area), and

24 ‘‘(ii) information on medicare enrollee

25 satisfaction and health outcomes.
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1 ‘‘(2) PLAN-SPECIFIC INFORMATION.—Information

2 for the next calendar year for each medicare choice

3 plan in the individual’s medicare payment area, in4 cluding—

5 ‘‘(A) the plan’s medicare service area,

6 ‘‘(B) the enrollee’s rights to benefits under

7 the plan, including—

8 ‘‘(i) covered items and services,

9 ‘‘(ii) deductible, coinsurance, and

10 copayment amounts, and

11 ‘‘(iii) the enrollee’s liability for pay12 ment amounts billed in excess of the plan’s

13 fee schedule,

14 ‘‘(C) the extent to which enrollees may select

15 the providers of their choice (from within or out16 side the plan’s network of providers if applica17 ble) and the restrictions (if any) on the plan’s

18 payment for services furnished to the enrollees by

19 other than the plan’s participating providers,

20 ‘‘(D) out-of-area coverage provided by the

21 plan,

22 ‘‘(E) coverage of emergency services and ur23 gently needed care,
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1 ‘‘(F) appeal rights of enrollees, including

2 the right to address grievances to the Secretary

3 or the applicable external review entity,

4 ‘‘(G) whether the plan is out-of-compliance

5 with any requirements of this part (as deter6 mined by the Secretary),

7 ‘‘(H) the plan’s premium price submitted

8 under section 1895N(a)(1) and an indication of

9 the difference between such premium price and

10 the standardized medicare payment amount, and

11 ‘‘(I) optional supplemental coverage avail12 able from the plan, including—

13 ‘‘(i) the supplemental items and serv14 ices covered, and

15 ‘‘(ii) the premium price for the op16 tional supplemental benefits.

17 ‘‘(e) ASSISTANCE.—

18 ‘‘(1) AGREEMENTS WITH COMMISSIONER OF SO19 CIAL SECURITY.—In order to promote the efficient ad20 ministration of this section and this part, the Sec21 retary may enter into an agreement with the Com22 missioner of Social Security under which the Com23 missioner performs administrative responsibilities re24 lating to enrollment and disenrollment under this sec25 tion.
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1 ‘‘(2) USE OF NON-FEDERAL ENTITIES.—The Sec2 retary shall, to the maximum extent feasible, enter

3 into contracts with appropriate non-Federal entities

4 to carry out activities under subsection (d).

5 ‘‘(3) PLANS.—Each medicare choice plan spon6 sor shall provide such information as the Secretary

7 requests with respect to a medicare choice plan in

8 order to carry out activities under subsection (d).

9 ‘‘SEC. 1895D. EFFECT OF ENROLLMENT.

10 ‘‘(a) PREMIUM DIFFERENTIALS.—If a medicare choice

11 eligible individual enrolls in a medicare choice plan, the

12 individual—

13 ‘‘(1) shall receive a rebate in the amount deter14 mined under section 1895N(b) if the plan’s premium

15 is less than the standardized medicare payment

16 amount; and

17 ‘‘(2) shall be required to pay the plan’s premium

18 in excess of the standardized medicare payment

19 amount.

20 ‘‘(b) PERIOD OF ENROLLMENT.—

21 ‘‘(1) ANNUAL ENROLLMENT PERIOD.—An indi22 vidual enrolling in a medicare choice plan during the

23 annual open enrollment period under section

24 1895G(b)(1) shall be enrolled in the plan for the cal25 endar year following the open enrollment period.
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1 ‘‘(2) SPECIAL ENROLLMENT PERIODS.—An indi2 vidual enrolling in a plan under section 1895G(b)(2)

3 shall be enrolled in the plan for the portion of the cal4 ender year on and after the date on which the enroll5 ment becomes effective (as specified by the Secretary).

6 ‘‘(3) TERMINATIONS.—

7 ‘‘(A) IN GENERAL.—Except as otherwise

8 provided in this subsection, an individual may

9 not terminate enrollment in a medicare choice

10 plan before the next annual open enrollment pe11 riod applicable to the individual.

12 ‘‘(B) QUALIFYING EVENTS.—Notwithstand13 ing subparagraph (A), an individual may termi14 nate enrollment in a medicare choice plan if—

15 ‘‘(i) the individual moves to a new

16 medicare service area, or

17 ‘‘(ii) the individual has experienced a

18 qualifying event (as determined by the Sec19 retary).

20 ‘‘(C) FOR CAUSE.—Notwithstanding sub21 paragraph (A), an individual may terminate en22 rollment in a medicare choice plan if the plan

23 fails to meet quality or capacity standards or for

24 other cause as determined by the Secretary.
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1 ‘‘(D) TERMINATION AFTER INITIAL ENROLL2 MENT.—An individual may terminate enroll3 ment in a medicare choice plan within 90 days

4 of the individual’s initial enrollment in such

5 medicare choice plan and enroll in another med6 icare choice plan or the traditional medicare

7 program.

8 ‘‘(4) SEAMLESS ENROLLMENT.—If a medicare

9 choice eligible individual is enrolled in a medicare

10 choice plan under this part and such individual fails

11 to provide the Secretary with notice of the individ12 ual’s enrollment or disenrollment under section

13 1895C(b)(1) during any open enrollment period ap14 plicable to the individual, the individual shall be

15 deemed to have reenrolled in the plan.

16 ‘‘(5) SPECIAL RULES FOR HIGH DEDUCTIBLE

17 PLANS.—In the case of a high deductible plan de18 scribed in section 1895A(b)(1)(B)(iii) operated in

19 connection with a medicare choice account, an indi20 vidual may not terminate enrollment in the plan

21 (other than under paragraph (3) (B), (C), or (D))

22 without at least 12 months notice given during the

23 annual open enrollment period under section

24 1895G(b)(1).
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1 ‘‘(6) SPECIAL RULES FOR UNION, TAFT-HART2 LEY, OR ASSOCIATION PLANS.—The Secretary shall es3 tablish special enrollment rules for the enrollment of

4 individuals in medicare choice plans that are union

5 or association-sponsored health plans described in sec6 tion 1895A(b)(2).

7 ‘‘(c) SOLE PAYMENTS.—Subject to subsections (d)(2)

8 and (e) of section 1895H, payments under a contract to

9 a medicare choice plan under section 1895O and for rebates

10 under section 1895N(b) shall be instead of the amounts

11 which (in the absence of the contract) would be otherwise

12 payable under the traditional medicare program for items

13 or services furnished to individuals enrolled with the plan

14 under this section.

15 ‘‘Subpart 3—Medicare Choice Plan Requirements

16 ‘‘SEC. 1895G. AVAILABILITY AND ENROLLMENT.

17 ‘‘(a) GENERAL AVAILABILITY.—

18 ‘‘(1) IN GENERAL.—Except as provided in para19 graph (2), each medicare choice plan sponsor shall

20 provide that each medicare choice eligible individual

21 shall be eligible to enroll under this part in a medi22 care choice plan of the sponsor during an enrollment

23 period applicable to such individual if the plan’s

24 medicare service area includes the geographic area in

25 which the individual resides.
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1 ‘‘(2) EXCEPTIONS.—

2 ‘‘(A) ACCEPTANCE TO LIMITS OF CAPAC3 ITY.—Each medicare choice plan sponsor shall

4 provide that, at any time during which enroll5 ments are accepted, the plan sponsor will accept

6 medicare choice eligible individuals in the order

7 in which they apply for enrollment up to the

8 limits of the medicare choice plan’s capacity (as

9 determined by the Secretary) and without re10 strictions, except as may be authorized in regula11 tions. The preceding sentence shall not apply if

12 it would result in the enrollment of enrollees sub13 stantially nonrepresentative, as determined in

14 accordance with regulations of the Secretary, of

15 the medicare population in the medicare service

16 area of the plan.

17 ‘‘(B) UNION, TAFT-HARTLEY, OR ASSOCIA18 TION HEALTH PLAN.—A medicare choice plan

19 sponsor of a union or association plan described

20 in section 1895A(b)(2) shall limit its enrollment

21 to members of the sponsoring group who are en22 titled to all rights and privileges of any other

23 members of the group and spouses of such mem24 bers. An association plan which is sponsored by

25 a religious fraternal benefit society may limit
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1 membership to individuals who share the same

2 religious convictions as the society.

3 ‘‘(3) POINT-OF-SERVICE COVERAGE.—If a Medi4 care Choice sponsor offers a Medicare Choice plan

5 that limits benefits to items and services furnished

6 only by providers in a network of providers which

7 have entered into a contract with the sponsor, the

8 sponsor must also offer at the time of enrollment, a

9 Medicare Choice plan that permits payment to be

10 made under the plan for covered items and services

11 when obtained out-of-network by the individual.

12 ‘‘(b) ENROLLMENT PERIODS.—

13 ‘‘(1) ANNUAL OPEN ENROLLMENT PERIOD.—

14 Each medicare choice plan sponsor shall offer an an15 nual open enrollment period in November of each

16 year for the enrollment and termination of enrollment

17 of medicare choice eligible individuals for the next

18 year.

19 ‘‘(2) ADDITIONAL PERIODS.—Each medicare

20 choice plan sponsor shall accept the enrollment of an

21 individual in the medicare choice plan—

22 ‘‘(A) during the initial medicare enrollment

23 period specified by section 1837 that applies to

24 the individual (effective as specified by section

25 1838), and
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1 ‘‘(B) during the period specified by the Sec2 retary following any termination of the enroll3 ment of the individual in a medicare choice plan

4 under subparagraph (B), (C), or (D) of section

5 1895D(b)(3).

6 ‘‘(c) PLAN PARTICIPATION IN ENROLLMENT PROC7 ESS.—

8 ‘‘(1) IN GENERAL.—In addition to any informa9 tional materials distributed by the Secretary under

10 section 1895C(c), a medicare choice plan sponsor may

11 develop and distribute marketing materials and en12 gage in marketing strategies in accordance with this

13 subsection.

14 ‘‘(2) PLAN MARKETING AND ADVERTISING STAND15 ARDS.—Any marketing material developed or distrib16 uted by a medicare choice plan sponsor and any mar17 keting strategy developed by such plan sponsor—

18 ‘‘(A) shall accurately describe differences be19 tween health care coverage available under the

20 plan and the health care coverage available

21 under the traditional medicare program,

22 ‘‘(B) shall be pursued in a manner not in23 tended to violate the nondiscrimination require24 ment of section 1895J(e)(1), and
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1 ‘‘(C) shall not contain false or materially

2 misleading information, and shall conform to

3 any other fair marketing and advertising stand4 ards and requirements applicable to such plans

5 under law.

6 ‘‘(3) PRIOR APPROVAL BY SECRETARY.—

7 ‘‘(A) IN GENERAL.—No marketing materials

8 may be distributed by a medicare choice plan

9 sponsor to (or for the use of) individuals eligible

10 to enroll with the plan under this part unless—

11 ‘‘(i) at least 45 days before its distribu12 tion, the plan has submitted the material to

13 the Secretary for review, and

14 ‘‘(ii) the Secretary has not disapproved

15 the distribution of the material.

16 ‘‘(B) REVIEW.—The Secretary shall review

17 all marketing materials submitted under guide18 lines established by the Secretary and shall dis19 approve such material if the Secretary deter20 mines, in the Secretary’s discretion, that the ma21 terial is materially inaccurate or misleading or

22 otherwise makes a material misrepresentation.

23 ‘‘(C) DEEMED APPROVAL.—If marketing

24 material has been submitted under subparagraph

25 (A) to the Secretary or a regional office of the
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1 Department of Health and Human Services and

2 the Secretary or the office has not disapproved

3 the distribution of the materials under subpara4 graph (B) with respect to an area, the Secretary

5 is deemed not to have disapproved such distribu6 tion in all areas covered by the plan.

7 ‘‘SEC. 1895H. BENEFITS PROVIDED TO INDIVIDUALS.

8 ‘‘(a) BASIC BENEFITS.—Each medicare choice plan

9 shall provide to members enrolled under this part, through

10 providers and other persons that meet the applicable re11 quirements of this title and part A of title XI—

12 ‘‘(1) those items and services covered under parts

13 A and B of this title which are available to individ14 uals residing in the medicare service area of the plan,

15 and

16 ‘‘(2) additional health services as the Secretary

17 may approve.

18 The Secretary shall approve any such additional health

19 care services which the plan proposes to offer to such mem20 bers, unless the Secretary determines that including such

21 additional services will substantially discourage enrollment

22 by medicare choice eligible individuals with the plan.

23 ‘‘(b) SUPPLEMENTAL BENEFITS.—Each medicare

24 choice plan may offer optional supplemental benefits to each

25 individual enrolled in the plan under this part for an addi-
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1 tional premium amount. If the supplemental benefits are

2 offered only to individuals enrolled in the sponsor’s plan

3 under this part, the additional premium amount shall be

4 the same for all enrolled individuals in the medicare pay5 ment area. Such benefits may be marketed and sold by the

6 medicare choice plan sponsor outside of the enrollment proc7 ess described in section 1895D(b).

8 ‘‘(c) COST-SHARING.—

9 ‘‘(1) ENROLLEE COST-SHARING UNDER CHOICE

10 PLAN MAY NOT EXCEED MEDICARE ENROLLEE

11 COST.—Except as provided in paragraph (2), in no

12 event may the average total amount of deductibles, co13 insurance, and copayments charged an individual

14 under a medicare choice plan with respect to basic

15 benefits described in subsection (a)(1) for a year ex16 ceed the average total amount of deductibles, coinsur17 ance, and copayments charged an individual under

18 the traditional medicare program for a year.

19 ‘‘(2) HIGH DEDUCTIBLE PLANS.—Subparagraph

20 (A) shall not apply to a high deductible plan de21 scribed in section 1895A(b)(1)(B)(iii).

22 ‘‘(3) DETERMINATION ON OTHER BASIS.—If the

23 Secretary determines that adequate data are not

24 available to determine the average amount under

25 paragraph (1), the Secretary may determine such
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1 amount with respect to all individuals in the medi2 care payment area, the State, or in the United States,

3 eligible to enroll in such plan under this part or on

4 the basis of other appropriate data.

5 ‘‘(d) NATIONAL COVERAGE DETERMINATION.—If there

6 is a national coverage determination made in the period

7 beginning on the date of an announcement under section

8 1895M(a) and ending on the date of the next announcement

9 under such section and the Secretary projects that the deter10 mination will result in a significant change in the costs

11 to the medicare choice plan of providing the benefits that

12 are the subject of such national coverage determination and

13 that such change in costs was not incorporated in the deter14 mination of the medicare payment amount included in the

15 announcement made at the beginning of such period—

16 ‘‘(1) such determination shall not apply to con17 tracts under this part until the first contract year

18 that begins after the end of such period, and

19 ‘‘(2) if such coverage determination provides for

20 coverage of additional benefits or coverage under ad21 ditional circumstances, section 1895I(b)(2) shall not

22 apply to payment for such additional benefits or ben23 efits provided under such additional circumstances

24 until the first contract year that begins after the end

25 of such period,
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1 unless otherwise required by law.

2 ‘‘(e) OVERLAPPING PERIODS OF COVERAGE.—A con3 tract under this part shall provide that in the case of an

4 individual who is receiving inpatient hospital services from

5 a subsection (d) hospital (as defined in section

6 1886(d)(1)(B)) as of the effective date of the individual’s—

7 ‘‘(1) enrollment with a medicare choice plan

8 under this part—

9 ‘‘(A) payment for such services until the

10 date of the individual’s discharge shall be made

11 under this title as if the individual were not en12 rolled with the plan,

13 ‘‘(B) the plan sponsor shall not be finan14 cially responsible for payment for such services

15 until the date after the date of the individual’s

16 discharge, and

17 ‘‘(C) the plan sponsor shall nonetheless be

18 paid the full amount otherwise payable to the

19 plan under this part, or

20 ‘‘(2) termination of enrollment with a medicare

21 choice plan under this part—

22 ‘‘(A) the plan sponsor shall be financially

23 responsible for payment for such services after

24 such date and until the date of the individual’s

25 discharge,
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1 ‘‘(B) payment for such services during the

2 stay shall not be made under section 1886(d),

3 and

4 ‘‘(C) the plan sponsor shall not receive any

5 payment with respect to the individual under

6 this part during the period the individual is not

7 enrolled.

8 ‘‘(f) ORGANIZATION AS SECONDARY PAYER.—Notwith9 standing any other provision of law, a medicare choice plan

10 sponsor may (in the case of the provision of services to an

11 individual under this part under circumstances in which

12 payment is made secondary pursuant to section 1862(b)(2))

13 charge or authorize the provider of such services to charge,

14 in accordance with the charges allowed under the law, plan,

15 or policy which is the primary payer under such cir16 cumstances—

17 ‘‘(1) the insurance carrier, employer, or other en18 tity which under such law, plan, or policy is to pay

19 for the provision of such services, or

20 ‘‘(2) such individual to the extent that the indi21 vidual has been paid under such law, plan, or policy

22 for such services.

23 ‘‘SEC. 1895I. LICENSING AND FINANCIAL REQUIREMENTS.

24 ‘‘(a) LICENSING REQUIREMENT.—
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1 ‘‘(1) IN GENERAL.—A medicare choice plan

2 sponsor shall be organized and licensed under appli3 cable State law as a risk-bearing entity eligible to

4 offer health insurance or health benefits coverage in

5 each State in which the medicare choice plan enrolls

6 individuals under this part.

7 ‘‘(2) EXCEPTION FOR UNION, TAFT-HARTLEY, OR

8 ASSOCIATION PLANS.—Paragraph (1) shall not apply

9 to a union or association plan described in section

10 1895A(b)(2) if such plan is exempt from such require11 ments under the Employee Retirement Income Secu12 rity Act of 1974.

13 ‘‘(3) COORDINATED CARE PLANS.—Paragraph

14 (1) shall apply to a coordinated care plan except to

15 the extent provided in section 1895R.

16 ‘‘(b) ASSUMPTION OF FULL FINANCIAL RISK.—A med17 icare choice plan sponsor shall assume full financial risk

18 on a prospective basis for the provision of health care serv19 ices for which benefits are required to be provided under

20 section 1895H(a)(1), except that such plan sponsor may—

21 ‘‘(1) obtain insurance or make other arrange22 ments for the cost of such health care services the ag23 gregate value of which exceeds $5,000 in any year,

24 ‘‘(2) obtain insurance or make other arrange25 ments for the cost of such health care services provided
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1 to its enrolled members other than through the plan

2 sponsor because medical necessity required their pro3 vision before they could be secured through the plan

4 sponsor,

5 ‘‘(3) obtain insurance or make other arrange6 ments for not more than 90 percent of the amount by

7 which its costs for any of its fiscal years exceed 115

8 percent of its income for such fiscal year, and

9 ‘‘(4) make arrangements with physicians or

10 other health professionals, health care institutions, or

11 any combination of such individuals or institutions

12 to assume all or part of the financial risk on a pro13 spective basis for the provision of basic health services

14 by the physicians or other health professionals or

15 through the institutions.

16 ‘‘(c) PROTECTION AGAINST RISK OF INSOLVENCY.—

17 ‘‘(1) IN GENERAL.—A medicare choice plan

18 sponsor shall make adequate provision against the

19 risk of insolvency (including provision to prevent en20 rollees from being held liable to any person or entity

21 for the plan sponsor’s debts in the event of the plan

22 sponsor’s insolvency)—

23 ‘‘(A) as determined by the Secretary, or

24 ‘‘(B) as determined by a State which the

25 Secretary determines requires solvency standards
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1 at least as stringent as the standards under sub2 paragraph (A).

3 ‘‘(2) FACTORS TO CONSIDER.—In establishing

4 standards under paragraph (1) for coordinated care

5 plans described in section 1895A(b)(1)(B)(ii), the Sec6 retary shall consult with interested parties and shall

7 take into account—

8 ‘‘(A) a coordinated care plan sponsor’s de9 livery system assets and its ability to provide

10 services directly to enrollees through affiliated

11 providers, and

12 ‘‘(B) alternative means of protecting

13 against insolvency, including reinsurance, unre14 stricted surplus, letters of credit, guarantees, or15 ganizational insurance coverage, and partner16 ships with other licensed entities.

17 The Secretary is not required to include alternative

18 means described in subparagraph (B) in the stand19 ards but may consider such alternatives where con20 sistent with the standards.

21 ‘‘(d) PAYMENTS TO THE PLAN.—

22 ‘‘(1) PREPAID PAYMENT.—A medicare choice

23 plan sponsor shall be compensated (except for

24 deductibles, coinsurance, and copayments) for the pro25 vision of health care services to individuals enrolled
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1 under this part by a payment by the Secretary (and

2 if applicable, the individual) which is paid on a peri3 odic basis without regard to the date the health care

4 services are provided and which is fixed without re5 gard to the frequency, extent, or kind of health care

6 service actually provided to a member.

7 ‘‘(2) SOLE PAYMENTS.—Subject to subsections

8 (d)(2) and (e) of section 1895H, if an individual is

9 enrolled under this part with a medicare choice plan,

10 only the plan sponsor shall be entitled to receive pay11 ments from the Secretary under this title for services

12 furnished to the individual.

13 ‘‘SEC. 1895J. HEALTH PLAN STANDARDS.

14 ‘‘(a) IN GENERAL.—Each medicare choice plan spon15 sor shall meet the requirements of this section.

16 ‘‘(b) QUALITY ASSURANCE AND ACCREDITATION.—

17 ‘‘(1) INTERNAL REVIEW.—

18 ‘‘(A) IN GENERAL.—Each medicare choice

19 plan sponsor must establish an ongoing quality

20 assurance program (in accordance with regula21 tions established by the Secretary) for health care

22 services it provides to such individuals.

23 ‘‘(B) ELEMENTS OF PROGRAM.—The quality

24 assurance program established under subpara25 graph (A) shall—
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1 ‘‘(i) stress health outcomes,

2 ‘‘(ii) provide for the establishment of

3 written protocols for utilization review,

4 based on current standards of medical prac5 tice,

6 ‘‘(iii) provide review by physicians

7 and other health care professionals of the

8 process followed in the provision of such

9 health care services,

10 ‘‘(iv) monitor and evaluate high-vol11 ume and high-risk services and the care of

12 acute and chronic conditions,

13 ‘‘(v) evaluate the continuity and co14 ordination of care that enrollees receive,

15 ‘‘(vi) have mechanisms to detect both

16 underutilization and overutilization of serv17 ices,

18 ‘‘(vii) after identifying areas for im19 provement, establish or alter practice pa20 rameters,

21 ‘‘(viii) take action to improve quality

22 and assess the effectiveness of such action

23 through systematic followup,

24 ‘‘(ix) make available information on

25 quality and outcomes measures to facilitate
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1 beneficiary comparison and choice of health

2 coverage options (in such form and on such

3 quality and outcomes measures as the Sec4 retary determines to be appropriate), and

5 ‘‘(x) provide that the program is evalu6 ated on an ongoing basis as to its effective7 ness.

8 ‘‘(2) EXTERNAL REVIEW.—

9 ‘‘(A) IN GENERAL.—Each medicare choice

10 plan sponsor shall, for each medicare choice plan

11 it operates, have an agreement with an inde12 pendent quality review and improvement organi13 zation approved by the Secretary.

14 ‘‘(B) FUNCTIONS OF ORGANIZATION.—Each

15 independent quality review and improvement or16 ganization with an agreement under subpara17 graph (A) shall—

18 ‘‘(i) provide an alternative mechanism

19 for addressing enrollee grievances,

20 ‘‘(ii) review plan performance based on

21 accepted quality performance criteria,

22 ‘‘(iii) promote and make plans ac23 countable for improved plan performance,

24 ‘‘(iv) integrate into ongoing external

25 quality assurance activities a new set of
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1 quality indicators and standards developed

2 specifically for the medicare population that

3 would be used to determine whether a plan

4 is providing quality care and appropriate

5 continuity and coordination of care, and

6 ‘‘(v) report to the Secretary on those

7 plans that have demonstrated unwillingness

8 or inability to improve their performance.

9 ‘‘(3) ACCREDITATION.—Each medicare choice

10 plan sponsor shall be required—

11 ‘‘(A) to meet accreditation standards estab12 lished by the Secretary, or

13 ‘‘(B) to be accredited by an external inde14 pendent accrediting organization, recognized by

15 the Secretary as requiring standards at least as

16 stringent as the standards established under sub17 paragraph (A).

18 ‘‘(4) ENCOUNTER DATA.—The Secretary shall

19 create incentives for medicare choice plan sponsors to

20 report aggregate encounter data, including data on

21 physician visits, nursing home days, home health

22 days, hospital inpatient days, and rehabilitation serv23 ices.

24 ‘‘(c) ACCESS.—Each medicare choice plan sponsor

25 shall—
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1 ‘‘(1) make the services described in section

2 1895H(a) (and such other health care services as such

3 individuals have contracted for) available and acces4 sible to each such individual, within the medicare

5 service area of the plan, with reasonable promptness,

6 and in a manner which assures continuity,

7 ‘‘(2) provide for reimbursement with respect to

8 such services which are provided to such an individ9 ual other than through the plan’s providers, if—

10 ‘‘(A) the services were medically necessary

11 and immediately required because of an unfore12 seen illness, injury, or condition, and

13 ‘‘(B) it was not reasonable given the cir14 cumstances to obtain the services through the

15 plan’s providers,

16 ‘‘(3) provide access to appropriate providers, in17 cluding credentialed specialists, for all medically nec18 essary treatment and services, and

19 ‘‘(4) except as provided by the Secretary on a

20 case-by-case basis, in the case of a coordinated care

21 plan described in section 1895A(b)(1)(B)(ii), provide

22 primary care services within 30 minutes or 30 miles

23 from an enrollee’s place of residence if the enrollee re24 sides in a rural area.
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1 ‘‘(d) CAPACITY.—Each medicare choice plan sponsor

2 shall provide the Secretary with a demonstration of the

3 plan’s capacity to adequately service the plan’s expected en4 rollment of individuals under this part.

5 ‘‘(e) CONSUMER PROTECTIONS.—

6 ‘‘(1) NONDISCRIMINATION.—Each medicare

7 choice plan sponsor shall provide assurances to the

8 Secretary that it will not deny enrollment to, expel,

9 or refuse to reenroll any such individual because of

10 the individual’s health status or requirements for

11 health care services, and that it will notify each such

12 individual of such fact at the time of the individual’s

13 enrollment. A medicare choice plan sponsor may not

14 cancel or refuse to renew a beneficiary except in the

15 case of fraud or nonpayment of premium amounts

16 due the plan.

17 ‘‘(2) GRIEVANCE PROCEDURES.—

18 ‘‘(A) IN GENERAL.—Each medicare choice

19 plan sponsor shall provide meaningful proce20 dures for hearing and resolving grievances be21 tween the plan (including any entity or individ22 ual through which the plan provides health care

23 services) and members enrolled with the plan

24 under this part.
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1 ‘‘(B) HEARING REQUIREMENT.—A member

2 enrolled with a medicare choice plan under this

3 part who is dissatisfied by reason of his failure

4 to receive any health service to which he believes

5 he is entitled and at no greater charge than he

6 believes he is required to pay is entitled, if the

7 amount in controversy is $100 or more, to a

8 hearing before the Secretary to the same extent

9 as is provided in section 205(b), and in any such

10 hearing the Secretary shall make the plan spon11 sor a party. If the amount in controversy is

12 $1,000 or more, the individual or plan sponsor

13 shall, upon notifying the other party, be entitled

14 to judicial review of the Secretary’s final deci15 sion as provided in section 205(g), and both the

16 individual and the plan sponsor shall be entitled

17 to be parties to that judicial review. In applying

18 sections 205(b) and 205(g) as provided in this

19 subparagraph, and in applying section 205(l)

20 thereto, any reference therein to the Commis21 sioner of Social Security or the Social Security

22 Administration shall be considered a reference to

23 the Secretary or the Department of Health and

24 Human Services, respectively.
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1 ‘‘(C) EXPEDITED REVIEW.—The Secretary

2 shall provide an expedited review procedure

3 under subparagraph (B) where a failure to re4 ceive any health care service or payment for such

5 service would result in significant harm.

6 ‘‘(3) SUPPLEMENTAL COVERAGE IF PLAN TERMI7 NATES THE CONTRACT.—Each medicare choice plan

8 sponsor that provides items and services pursuant to

9 a contract under this part shall provide assurances to

10 the Secretary that in the event the contract is termi11 nated, the sponsor shall provide or arrange for sup12 plemental coverage of benefits under this title related

13 to a preexisting condition with respect to any exclu14 sion period, to all individuals enrolled with the entity

15 who receive benefits under this title, for the lesser of

16 6 months or the duration of such period.

17 ‘‘(f) PROMPT PAYMENT.—

18 ‘‘(1) IN GENERAL.—Each medicare choice plan

19 sponsor shall provide prompt payment (consistent

20 with the provisions of sections 1816(c)(2) and

21 1842(c)(2)) of claims submitted for services and sup22 plies furnished to individuals pursuant to such con23 tract, if the services or supplies are not furnished

24 under a contract between the plan and the provider

25 or supplier.
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1 ‘‘(2) DIRECT PAYMENT.—In the case of a medi2 care choice plan sponsor which the Secretary deter3 mines, after notice and opportunity for a hearing, has

4 failed to make payments of amounts in compliance

5 with paragraph (1), the Secretary may provide for

6 direct payment of the amounts owed to providers and

7 suppliers for such covered services furnished to indi8 viduals enrolled under this part under the contract.

9 If the Secretary provides for such direct payments,

10 the Secretary shall provide for an appropriate reduc11 tion in the amount of payments otherwise made to the

12 plan sponsor under this part to reflect the amount of

13 the Secretary’s payments (and costs incurred by the

14 Secretary in making such payments).

15 ‘‘(g) ADVANCE DIRECTIVES.—A contract under this

16 part shall provide that a medicare choice plan sponsor shall

17 meet the requirement of section 1866(f) (relating to main18 taining written policies and procedures respecting advance

19 directives).

20 ‘‘(h) TIMELY AUTHORIZATION FOR PROMPTLY NEED21 ED CARE IDENTIFIED AS A RESULT OF REQUIRED SCREEN22 ING EVALUATION.—

23 ‘‘(1) ACCESS TO PROCESS.—A medicare choice

24 plan sponsor shall provide access 24 hours a day, 7

25 days a week to such persons as may be authorized to
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1 make any prior authorizations required by the plan

2 sponsor for coverage of items and services (other than

3 emergency services) that a treating physician or other

4 emergency department personnel identify, pursuant to

5 a screening evaluation required under section

6 1867(a), as being needed promptly by an individual

7 enrolled with the organization under this part.

8 ‘‘(2) DEEMED APPROVAL.—A medicare choice

9 plan sponsor is deemed to have approved a request for

10 such promptly needed items and services if the physi11 cian or other emergency department personnel in12 volved—

13 ‘‘(A) has made a reasonable effort to contact

14 such a person for authorization to provide an

15 appropriate referral for such items and services

16 or to provide the items and services to the indi17 vidual and access to the person has not been pro18 vided (as required in paragraph (1)), or

19 ‘‘(B) has requested such authorization from

20 the person and the person has not denied the au21 thorization within 30 minutes after the time the

22 request is made.

23 ‘‘(3) EFFECT OF APPROVAL.—Approval of a re24 quest for a prior authorization determination (includ25 ing a deemed approval under paragraph (2)) shall be
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1 treated as approval of a request for any items and

2 services that are required to treat the medical condi3 tion identified pursuant to the required screening

4 evaluation.

5 ‘‘(4) DEFINITION OF EMERGENCY SERVICES.—In

6 this subsection, the term ‘emergency services’ means—

7 ‘‘(A) health care items and services fur8 nished in the emergency department of a hospital

9 (including a trauma center), and

10 ‘‘(B) ancillary services routinely available

11 to such department,

12 to the extent they are required to evaluate and treat

13 an emergency medical condition (as defined in para14 graph (5)) until the condition is stabilized.

15 ‘‘(5) EMERGENCY MEDICAL CONDITION.—In

16 paragraph (4), the term ‘emergency medical condi17 tion’ means a medical condition, the onset of which

18 is sudden, that manifests itself by symptoms of suffi19 cient severity, including severe pain, that a prudent

20 layperson, who possesses an average knowledge of

21 health and medicine, could reasonably expect the ab22 sence of immediate medical attention to result in—

23 ‘‘(A) placing the person’s health in serious

24 jeopardy,
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1 ‘‘(B) serious impairment to bodily func2 tions, or

3 ‘‘(C) serious dysfunction of any bodily

4 organ or part.

5 ‘‘Subpart 4—Determination of Medicare Payment

6 Amounts and Rebates

7 ‘‘SEC. 1895M. MEDICARE PAYMENT AMOUNTS.

8 ‘‘(a) IN GENERAL.—Not later than July 31 of each cal9 endar year (beginning with 1996), the Secretary shall deter10 mine, and announce in a manner intended to provide no11 tice to interested parties, a standardized medicare payment

12 amount determined in accordance with this section for the

13 following calendar year for each medicare payment area.

14 ‘‘(b) CALCULATION OF STANDARDIZED MEDICARE

15 PAYMENT AMOUNTS.—For purposes of this part—

16 ‘‘(1) 1997.—

17 ‘‘(A) IN GENERAL.—The standardized medi18 care payment amount for calendar year 1997 for

19 a medicare payment area shall be equal to the

20 sum of—

21 ‘‘(i) 50 percent of the modified per

22 capita rate for calendar year 1996, and

23 ‘‘(ii) 50 percent of the adjusted average

24 national per capita rate for calendar year

25 1996,
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1 increased by the percentage increase in the gross

2 domestic product per capita for the 12-month pe3 riod ending on June 30, 1996.

4 ‘‘(B) MODIFIED PER CAPITA RATE.—For

5 purposes of subparagraph (A)(i), the modified

6 per capita rate for calendar year 1996 for a

7 medicare payment area shall be equal to the per

8 capita rate which would have been determined

9 (without regard to class) under section

10 1876(a)(1)(C) for 1995 if—

11 ‘‘(i) the applicable geographic area

12 were the medicare payment area, and

13 ‘‘(ii) 50 percent of any payments at14 tributable to sections 1886(d)(5)(B),

15 1886(h), and 1886(d)(5)(F) (relating to

16 IME, GME, and DSH payments) were not

17 taken into account,

18 increased by the percentage increase which the

19 Secretary estimates will occur in medicare ex20 penditures per capita for 1996 over medicare ex21 penditures per capita for 1995.

22 ‘‘(C) ADJUSTED AVERAGE NATIONAL PER

23 CAPITA RATE.—

24 ‘‘(i) IN GENERAL.—For purposes of

25 subparagraph (A)(ii), the adjusted average
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1 national per capita rate for a medicare

2 payment area for calendar year 1996 shall

3 be equal to the sum, for all types of medi4 care services (as classified by the Secretary),

5 of the product for each such type of—

6 ‘‘(I) the average national per cap7 ita rate for 1996,

8 ‘‘(II) the proportion of such rate

9 for the year which is attributable to

10 such type of services, and

11 ‘‘(III) an index that reflects for

12 1996 and that type of service the rel13 ative input price of such services in the

14 medicare payment area as compared to

15 the national average input price of

16 such services.

17 In applying subclause (III), the Secretary

18 shall apply those indices that are used in

19 applying (or updating) medicare payment

20 rates for specific areas and localities.

21 ‘‘(ii) AVERAGE NATIONAL PER CAPITA

22 RATE.—For purposes of clause (i), the aver23 age national per capita rate for 1996 is the

24 weighted average of the modified per capita
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1 rates determined under subparagraph (B)

2 for all medicare payment areas for 1996.

3 ‘‘(2) SUCCEEDING YEARS.—

4 ‘‘(A) IN GENERAL.—The standardized medi5 care payment amount for any calendar year

6 after 1997 in a medicare payment area shall be

7 an amount equal to the standardized medicare

8 payment amount determined for such area for

9 the preceding year, increased by the percentage

10 increase in the gross domestic product per capita

11 for the 12-month period ending on June 30 of

12 the preceding calendar year.

13 ‘‘(B) SPECIAL RULE FOR 1998.—In applying

14 subparagraph (A) for 1998, the standardized

15 medicare payment amount for the preceding cal16 endar year shall be the amount which would

17 have been determined if clause (ii) of paragraph

18 (1)(B) had been applied by substituting ‘100

19 percent’ for ‘50 percent’.

20 ‘‘(3) SPECIAL RULE FOR INDIVIDUALS WITH

21 END-STAGE RENAL DISEASE.—In computing the

22 standardized medicare payment amount for any med23 icare payment area, there shall not be taken into ac24 count any individuals with end-stage renal disease or

25 any medicare expenditures for such individuals.
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1 ‘‘(c) ADJUSTMENTS FOR PAYMENTS TO PLAN SPON2 SORS.—

3 ‘‘(1) IN GENERAL.—The rate of payment under

4 section 1895O to a medicare choice plan sponsor with

5 respect to any individual enrolled in a medicare

6 choice plan of the sponsor shall be equal to the stand7 ardized medicare payment amount for the medicare

8 payment area, adjusted for such risk factors as age,

9 disability status, gender, institutional status, health

10 status, and such other factors as the Secretary deter11 mines to be appropriate, so as to ensure actuarial

12 equivalence. The Secretary may add to, modify, or

13 substitute for such classes, if such changes will im14 prove the determination of actuarial equivalence.

15 ‘‘(2) SPECIAL RULE FOR END-STAGE RENAL DIS16 EASE.—The Secretary shall establish a separate rate

17 of payment under section 1895O to a medicare choice

18 plan sponsor with respect to any individual with end19 stage renal disease enrolled in a medicare choice plan

20 of the sponsor. Such rate of payment shall be actuari21 ally equivalent to rates paid to other enrollees in the

22 medicare payment area (or such other area as speci23 fied by the Secretary).

24 ‘‘(d) GEOGRAPHICAL ADJUSTMENTS.—

25 ‘‘(1) ANNUAL ADJUSTMENTS.—
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1 ‘‘(A) IN GENERAL.—Unless Congress pro2 vides otherwise, beginning with calendar years

3 after 1999, the Secretary shall, based on the

4 analysis under paragraph (2) and to the extent

5 the Secretary determines necessary, make annual

6 differential adjustments to the standardized med7 icare payment amounts determined under sub8 section (b)(2) for calendar years 2000 and 2001

9 in a manner designed to achieve appropriate

10 and equitable variation in standardized medi11 care payment amounts across medicare payment

12 areas by calendar year 2002. Such variation

13 shall be reasonably related to measurable geo14 graphic differences in medicare payment areas.

15 ‘‘(B) BUDGET NEUTRALITY.—The Secretary

16 shall adjust the standardized medicare payment

17 amounts under subsection (b) in a manner that

18 ensures that total payments under this section

19 for a year are not greater or less than total pay20 ments under this section would have been but for

21 the application of subparagraph (A).

22 ‘‘(2) ANALYSIS.—The Secretary, in consultation

23 with interested parties, shall conduct an analysis of

24 the measurable input cost differences across medicare

25 payment areas, including wage differentials, and
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1 other measurable variables identified by the Sec2 retary. The Secretary shall also determine the degree

3 to which medicare beneficiaries, including bene4 ficiaries in rural and underserved areas, have access

5 to more health plan choices by calendar year 2000

6 under this part, and the extent to which standardized

7 medicare payment amounts have limited or enhanced

8 such choices.

9 ‘‘(3) REPORT TO CONGRESS.—Not later than

10 March 1, 1999, the Secretary shall submit a report to

11 the appropriate committees of Congress that includes

12 the results of the analysis described in paragraph (2)

13 and the annual differential adjustments that the Sec14 retary intends to implement under paragraph (1) for

15 calendar years 2000 and 2001.

16 ‘‘(e) NOTICE IN CHANGES TO BENEFIT ASSUMP17 TIONS.—

18 ‘‘(1) IN GENERAL.—At least 45 days before mak19 ing the announcement under subsection (a) for a year

20 (beginning with the announcement for 1998), the Sec21 retary shall provide for notice to medicare choice

22 plans of proposed changes to be made in the methodol23 ogy or benefit coverage assumptions from the meth24 odology and assumptions used in the previous an-
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1 nouncement and shall provide such plans an oppor2 tunity to comment on such proposed changes.

3 ‘‘(2) EXPLANATION.—In each announcement

4 made under subsection (a) for a year (beginning with

5 the announcement for 1998), the Secretary shall in6 clude an explanation of the assumptions (including

7 any benefit coverage assumptions) and changes in

8 methodology used in the announcement in sufficient

9 detail so that medicare choice plans can compute

10 medicare payment rates under subsection (d) for

11 classes of individuals located in each medicare pay12 ment area which is in whole or in part within the

13 medicare service area of such a plan.

14 ‘‘(f) DEMONSTRATION PROJECT ON MARKET-BASED

15 REIMBURSEMENT AND COMPETITIVE PRICING.—The Sec16 retary shall establish 1 or more demonstration projects to

17 determine the standardized medicare payment amounts de18 scribed in subsection (b) through competitive bidding by

19 medicare choice plans in a medicare payment area. Not

20 later than December 31, 2001, the Secretary shall submit

21 a report to the Congress on the success of such projects in

22 determining standardized medicare payment amounts that

23 are reflective of market price.

24 ‘‘SEC. 1895N. PREMIUMS AND REBATES.

25 ‘‘(a) SUBMISSION AND CHARGING OF PREMIUMS.—
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1 ‘‘(1) IN GENERAL.—Each medicare choice plan

2 sponsor shall file with the Secretary each year, in a

3 form and manner and at a time specified by the Sec4 retary, the amount of the monthly premium for cov5 erage under each medicare choice plan it offers under

6 this part in each medicare payment area in which the

7 plan is being offered.

8 ‘‘(2) UNIFORM PREMIUM.—The premiums

9 charged by a medicare choice plan sponsor under this

10 part may not vary among individuals who reside in

11 the same medicare payment area.

12 ‘‘(3) TERMS AND CONDITIONS OF IMPOSING PRE13 MIUMS.—Each medicare choice plan sponsor shall

14 permit the payment of monthly premiums on a

15 monthly basis.

16 ‘‘(b) REBATES.—

17 ‘‘(1) IN GENERAL.—If the standardized medicare

18 payment amount for the medicare payment area in

19 which an individual resides exceeds the amount of the

20 monthly premium for the plan in which the individ21 ual is enrolled (as submitted under subsection (a)(1)),

22 the Secretary shall—

23 ‘‘(A) in the case of an individual—

24 ‘‘(i) who is enrolled in a high deduct25 ible health plan described in section
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1 1895A(b)(1)(B)(iii), deposit 100 percent of

2 such excess in the medicare choice account

3 specified by the individual, or

4 ‘‘(ii) who is not so enrolled but who

5 elects the application of this clause, deposit

6 100 percent of such excess in the medicare

7 choice account specified by the individual;

8 or

9 ‘‘(B)(i) pay to the medicare choice plan

10 sponsor on behalf of such individual the monthly

11 amount equal to 100 percent of such excess up to

12 the amount of the premium amount of such indi13 vidual for supplemental benefits described in sec14 tion 1895H(b),

15 ‘‘(ii) pay to such individual an amount

16 equal to 75 percent of the remainder of such ex17 cess, and

18 ‘‘(iii) deposit the remainder of such excess

19 in the Federal Hospital Insurance Trust Fund.

20 ‘‘(2) TIME FOR PAYMENT.—

21 ‘‘(A) IN GENERAL.—A rebate under para22 graph (1)(B)(ii) shall be paid as of the close of

23 the calendar year to which the enrollment ap24 plied.
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1 ‘‘(B) DEPOSITS IN MEDICARE CHOICE AC2 COUNTS.—Deposits described in paragraph

3 (1)(A) shall be made on a monthly basis.

4 ‘‘(C) OTHER PAYMENTS AND DEPOSITS.—

5 Payments and deposits described in subpara6 graphs (B)(i) and (iii) shall be made on a

7 monthly basis.

8 ‘‘(3) SOURCE OF REBATES.—Deposits and pay9 ments described in paragraph (1) shall be made in

10 the same manner as payments are made under sec11 tion 1895O(b).

12 ‘‘SEC. 1895O. PAYMENTS TO PLAN SPONSORS.

13 ‘‘(a) MONTHLY PAYMENTS.—

14 ‘‘(1) IN GENERAL.—For each individual enrolled

15 with a plan under this part, the Secretary shall make

16 monthly payments in advance to the medicare choice

17 plan sponsor of the medicare choice plan with which

18 the individual is enrolled in an amount equal to the

19 medicare payment rate determined with respect to

20 such individual under section 1895M(c).

21 ‘‘(2) RETROACTIVE ADJUSTMENTS.—The amount

22 of payment under this paragraph may be retro23 actively adjusted to take into account any difference

24 between the actual number of individuals enrolled in

25 the plan under this section and the number of such
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1 individuals estimated to be so enrolled in determining

2 the amount of the advance payment.

3 ‘‘(b) PAYMENTS FROM TRUST FUNDS.—The payment

4 to a medicare choice plan sponsor under this section for

5 a medicare-eligible individual shall be made from the Fed6 eral Hospital Insurance Trust Fund and the Federal Sup7 plementary Medical Insurance Trust Fund in such propor8 tion as the Secretary determines reflects the relative weight

9 that benefits under parts A and B are representative of the

10 actuarial value of the total benefits under this part.

11 ‘‘Subpart 5—Contractual Authority; Temporary

12 Certification; Regulations

13 ‘‘SEC. 1895P. GENERAL PERMISSION TO CONTRACT.

14 ‘‘The Secretary shall enter into a contract with any

15 medicare choice plan sponsor in a medicare payment area

16 if the requirements of this part are met with respect to the

17 medicare choice plan and the plan sponsor.

18 ‘‘SEC. 1895Q. RENEWAL AND TERMINATION OF CONTRACT.

19 ‘‘(a) IN GENERAL.—Except as provided in subsection

20 (b), each contract under this part may be made automati21 cally renewable from term to term in the absence of notice

22 by either party of intention to terminate at the end of the

23 current term.

24 ‘‘(b) TERMINATION FOR CAUSE.—
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1 ‘‘(1) IN GENERAL.—In accordance with proce2 dures established under paragraph (2), the Secretary

3 may terminate any contact with a medicare choice

4 plan sponsor at any time or may impose the inter5 mediate sanctions described in paragraph (2) or (3)

6 or subsection (f) (whichever is applicable) on the plan

7 sponsor, if the Secretary finds that the plan spon8 sor—

9 ‘‘(A) has failed substantially to carry out

10 the contract,

11 ‘‘(B) is carrying out the contract in a man12 ner substantially inconsistent with the efficient

13 and effective administration of this part, or

14 ‘‘(C) no longer substantially meets the ap15 plicable conditions of this part.

16 ‘‘(2) PROCEDURES.—The Secretary may termi17 nate a contract with a medicare choice plan sponsor

18 under this part or may impose the intermediate sanc19 tions described in subsection (f)(3) on the plan in ac20 cordance with formal investigation and compliance

21 procedures established by the Secretary under

22 which—

23 ‘‘(A) the Secretary first provides the medi24 care choice plan sponsor with the reasonable op25 portunity to develop and implement a corrective
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1 action plan to correct the deficiencies that were

2 the basis of the Secretary’s determination under

3 paragraph (1) and the medicare choice plan

4 sponsor fails to develop or implement such a cor5 rective action plan,

6 ‘‘(B) in deciding whether to impose sanc7 tions, the Secretary considers aggravating factors

8 such as whether a plan sponsor has a history of

9 deficiencies or has not taken action to correct de10 ficiencies the Secretary has brought to the plan

11 sponsor’s attention,

12 ‘‘(C) there are no unreasonable or unneces13 sary delays between the finding of a deficiency

14 and the imposition of sanctions, and

15 ‘‘(D) the Secretary provides the plan spon16 sor with reasonable notice and opportunity for

17 hearing (including the right to appeal an initial

18 decision) before imposing any sanction or termi19 nating the contract.

20 ‘‘(c) TERMS OF CONTRACT.—Each contract under this

21 part—

22 ‘‘(1) shall provide that the Secretary, or any per23 son or organization designated by the Secretary—

24 ‘‘(A) shall have the right to inspect or other25 wise evaluate—
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1 ‘‘(i) the quality, appropriateness, and

2 timeliness of services performed under the

3 contract, and

4 ‘‘(ii) the facilities of the plan sponsor

5 when there is reasonable evidence of some

6 need for such inspection,

7 ‘‘(B) shall have the right to audit and in8 spect any books and records of the plan sponsor

9 that pertain—

10 ‘‘(i) to the ability of the plan sponsor

11 to bear the risk of potential financial losses,

12 and

13 ‘‘(ii) shall require the plan sponsor

14 with a contract to provide (and pay for)

15 written notice in advance of the contract’s

16 termination, as well as a description of al17 ternatives for obtaining benefits under this

18 title, to each individual enrolled under this

19 part with the plan sponsor,

20 ‘‘(C)(i) except as provided by the Secretary,

21 shall require the plan sponsor to comply with re22 quirements similar to the requirements of sub23 sections (a) and (c) of section 1318 of the Public

24 Health Service Act (relating to disclosure of cer25 tain financial information) and section
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1 1301(c)(8) of such Act (relating to liability ar2 rangements to protect members),

3 ‘‘(ii) shall require the plan sponsor to pro4 vide and supply information (described in sec5 tion 1866(b)(2)(C)(ii)) in the manner such infor6 mation is required to be provided or supplied

7 under that section, and

8 ‘‘(iii) shall require the plan sponsor to no9 tify the Secretary of loans and other special fi10 nancial arrangements which are made between

11 the plan sponsor and subcontractors, affiliates,

12 and related parties, and

13 ‘‘(D) shall contain such other terms and

14 conditions not inconsistent with this part (in15 cluding requiring the plan sponsor to provide the

16 Secretary with such information) as the Sec17 retary may find necessary and appropriate.

18 ‘‘(d) 5-YEAR LOCKOUT.—The Secretary may not enter

19 into a contract under this part with a medicare choice plan

20 sponsor if a previous contract with that plan sponsor under

21 this part was terminated at the request of the plan sponsor

22 within the preceding 5-year period, except in circumstances

23 which warrant special consideration, as determined by the

24 Secretary.
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1 ‘‘(e) APPLICATION OF OTHER FEDERAL LAWS.—The

2 authority vested in the Secretary by this part may be per3 formed without regard to such provisions of law or regula4 tions relating to the making, performance, amendment, or

5 modification of contracts of the United States as the Sec6 retary may determine to be inconsistent with the further7 ance of the purpose of this title.

8 ‘‘(f) REMEDIES FOR FAILURE TO COMPLY.—

9 ‘‘(1) FAILURE OF PLAN SPONSOR TO COMPLY

10 WITH CONTRACT.—If the Secretary determines that a

11 medicare choice plan sponsor—

12 ‘‘(A) fails substantially to provide medically

13 necessary items and services that are required

14 (under law or under the contract) to be provided

15 to an individual covered under the contract, and

16 the failure has adversely affected (or has substan17 tial likelihood of adversely affecting) the individ18 ual,

19 ‘‘(B) imposes cost sharing on individuals

20 enrolled under this part in excess of the cost

21 sharing permitted,

22 ‘‘(C) acts to expel or to refuse to re-enroll an

23 individual in violation of the provisions of this

24 part,
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1 ‘‘(D) engages in any practice that would

2 reasonably be expected to have the effect of deny3 ing or discouraging enrollment (except as per4 mitted by this part) by eligible individuals with

5 the plan whose medical condition or history in6 dicates a need for substantial future medical

7 services,

8 ‘‘(E) misrepresents or falsifies information

9 that is furnished—

10 ‘‘(i) to the Secretary under this section,

11 or

12 ‘‘(ii) to an individual or to any other

13 entity under this section,

14 ‘‘(F) fails to comply with the requirements

15 of section 1895J(f), or

16 ‘‘(G) employs or contracts with any indi17 vidual or entity that is excluded from participa18 tion under this title under section 1128 or 1128A

19 for the provision of health care, utilization re20 view, medical social work, or administrative

21 services or employs or contracts with any entity

22 for the provision (directly or indirectly) through

23 such an excluded individual or entity of such

24 services,
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1 the Secretary may provide, in addition to any other

2 remedies authorized by law, for any of the remedies

3 described in paragraph (2).

4 ‘‘(2) REMEDIES.—The remedies described in this

5 paragraph are—

6 ‘‘(A) civil money penalties of not more than

7 $25,000 for each determination under paragraph

8 (1) or, with respect to a determination under

9 subparagraph (D) or (E)(i) of such paragraph,

10 of not more than $100,000 for each such deter11 mination, plus, with respect to a determination

12 under paragraph (1)(B), double the excess

13 amount charged in violation of such subpara14 graph (and the excess amount charged shall be

15 deducted from the penalty and returned to the

16 individual concerned), and plus, with respect to

17 a determination under paragraph (1)(D),

18 $15,000 for each individual not enrolled as a re19 sult of the practice involved,

20 ‘‘(B) suspension of enrollment of individ21 uals under this section after the date the Sec22 retary notifies the plan sponsor of a determina23 tion under paragraph (1) and until the Sec24 retary is satisfied that the basis for such deter-
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1 mination has been corrected and is not likely to

2 recur, or

3 ‘‘(C) suspension of payment to the plan

4 sponsor under this section for individuals en5 rolled after the date the Secretary notifies the

6 plan sponsor of a determination under para7 graph (1) and until the Secretary is satisfied

8 that the basis for such determination has been

9 corrected and is not likely to recur.

10 ‘‘(3) INTERMEDIATE SANCTIONS.—In the case of

11 a medicare choice plan sponsor for which the Sec12 retary makes a determination under subsection (b)(1)

13 the basis of which is not described in subparagraph

14 (A) thereof, the Secretary may apply the following in15 termediate sanctions:

16 ‘‘(A) Civil money penalties of not more

17 than $25,000 for each determination under sub18 section (b)(1) if the deficiency that is the basis

19 of the determination has directly adversely af20 fected (or has the substantial likelihood of ad21 versely affecting) an individual covered under

22 the plan’s contract.

23 ‘‘(B) Civil money penalties of not more

24 than $10,000 for each week beginning after the

25 initiation of procedures by the Secretary under
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1 subsection (b)(2) during which the deficiency

2 that is the basis of a determination under sub3 section (b)(1) exists.

4 ‘‘(C) Suspension of enrollment of individ5 uals under this section after the date the Sec6 retary notifies the plan sponsor of a determina7 tion under subsection (b)(1) and until the Sec8 retary is satisfied that the deficiency that is the

9 basis for the determination has been corrected

10 and is not likely to recur.

11 ‘‘(4) PROCEEDINGS.—The provisions of section

12 1128A (other than subsections (a) and (b)) shall

13 apply to a civil money penalty under paragraph

14 (2)(A) or (3)(A) in the same manner as they apply

15 to a civil money penalty or proceeding under section

16 1128A(a).

17 ‘‘SEC. 1895R. TEMPORARY CERTIFICATION PROCESS FOR

18 COORDINATED CARE PLANS.

19 ‘‘(a) FEDERAL ACTION ON CERTIFICATION.—

20 ‘‘(1) IN GENERAL.—If—

21 ‘‘(A) a State fails to substantially complete

22 action on a licensing application of a coordi23 nated care plan sponsor within 90 days of re24 ceipt of the completed application, or
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1 ‘‘(B) a State denies a licensing application

2 and the Secretary determines that the State’s li3 censing standards or review process create an

4 unreasonable barrier to market entry,

5 the Secretary shall evaluate such application pursu6 ant to the procedures established under subsection (b).

7 ‘‘(2) UNREASONABLE BARRIERS TO MARKET

8 ENTRY.—A State’s licensing standards and review

9 process shall not be treated as unreasonable barriers

10 to market entry under paragraph (1) if—

11 ‘‘(A) they are applied consistently to all co12 ordinated care medicare choice plan applica13 tions,

14 ‘‘(B) are not directly in conflict, or incon15 sistent with, the Federal standards.

16 ‘‘(b) FEDERAL CERTIFICATION PROCEDURES.—

17 ‘‘(1) IN GENERAL.—The Secretary shall establish

18 a process for certification of a coordinated care plan

19 and its sponsor as meeting the requirements of this

20 part in cases described in subsection (a)(1).

21 ‘‘(2) REQUIREMENTS.—Such process shall—

22 ‘‘(A) set forth the standards for certifi23 cation,

24 ‘‘(B) provide that final action will be taken

25 on an application for certification within 120
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1 business days of receipt of the completed applica2 tion,

3 ‘‘(C) provide that State law and regulations

4 shall apply to the extent they have not been

5 found to be an unreasonable barrier to market

6 entry under subsection (a)(1)(B), and

7 ‘‘(D) require any person receiving a certifi8 cate to provide the Secretary with all reasonable

9 information in order to ensure compliance with

10 the certification.

11 ‘‘(3) EFFECT OF CERTIFICATIONS.—

12 ‘‘(A) IN GENERAL.—A certificate under this

13 section shall be issued for not more than 36

14 months and may not be renewed.

15 ‘‘(B) COORDINATION WITH STATE.—A per16 son receiving a certificate under this section

17 shall continue to seek State licensure under sub18 section (a) during the period the certificate is in

19 effect.

20 ‘‘(C) SUNSET.—No certificate shall be is21 sued under this section after December 31, 2000,

22 and no certificate under this section shall re23 main in effect after December 31, 2001.

24 ‘‘(c) REPORT.—Not later than December 31, 1998, the

25 Secretary shall report to Congress on the temporary Federal
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1 certification system under subsection (b), including an

2 analysis of State efforts to adopt licensing standards and

3 review processes that take into account the fact that coordi4 nated care plan sponsors provide services directly to enroll5 ees through affiliated providers.

6 ‘‘(d) COORDINATED CARE PLAN.—In this section, the

7 term ‘coordinated care plan’ means a plan described in sec8 tion 1895A(b)(1)(B)(ii).

9 ‘‘(e) TRANSITION RULE FOR CERTAIN RISK CONTRAC10 TORS.—A medicare choice plan sponsor that is an eligible

11 organization (as defined in section 1876(b)) and that—

12 ‘‘(1) has a risk-sharing contract in effect under

13 section 1876 as of the date of the enactment of this

14 part, or

15 ‘‘(2) has an application for such a contract filed

16 before such date and the contract is entered into before

17 July 1, 1996,

18 shall be treated as meeting the Federal standards in effect

19 under this section for any contract year beginning before

20 January 1, 2000.

21 ‘‘(f) PARTIAL CAPITATION DEMONSTRATION.—The

22 Secretary shall conduct a demonstration on alternative par23 tial risk-sharing arrangements between the Secretary and

24 health care providers. The Secretary shall report to Con25 gress no later than December 31, 1998, on the administra-
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1 tive feasibility of such partial capitation methods and the

2 information necessary to implement such arrangements.

3 ‘‘SEC. 1895S. REGULATIONS.

4 ‘‘(a) IN GENERAL.—The Secretary shall establish such

5 regulations as may be necessary to carry out the purposes

6 of this part, including regulations setting forth the require7 ments to meet all quality, access, and solvency standards

8 specified in sections 1895I and 1895J.

9 ‘‘(b) USE OF INTERIM, FINAL REGULATIONS.—In

10 order to carry out the provisions of this part in a timely

11 manner, the Secretary may, within 120 days after the date

12 of the enactment of this part, promulgate regulations de13 scribed in subsection (a) that take effect on an interim

14 basis, after notice and opportunity for public comment.’’.

15 (b) COORDINATION WITH FEHBP.—Notwithstanding

16 any provision of part D of title XVIII of the Social Security

17 Act (as added by subsection (a)), individuals who are en18 rolled in a health benefit plan under chapter 89 of title 5,

19 United States Code, shall not be eligible to enroll in high

20 deductible medicare choice plans described in section

21 1895A(b)(1)(B)(iii) of such Act until such time as the Di22 rector of the Office of Management and Budget certifies to

23 the Secretary of Health and Human Services that the Office

24 of Personnel Management has adopted policies which will

25 ensure that the enrollment of such individuals in such plans
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1 will not result in increased expenditures for the Federal

2 Government for health benefit plans under such chapter.

3 (c) CONFORMING AMENDMENTS.—

4 (1) IN GENERAL.—Not later than 90 days after

5 the date of the enactment of this Act, the Secretary of

6 Health and Human Services shall submit to the ap7 propriate committees of Congress a legislative pro8 posal providing for such technical and conforming

9 amendments in the law as are required by the provi10 sions of this chapter.

11 (2) OTHER AMENDMENTS.—(A) Section

12 1866(a)(1)(O) (42 U.S.C. 1395cc(a)(1)(O)) is amend13 ed—

14 (i) in the matter preceding clause (i), by in15 serting ‘‘or medicare choice plan under part D’’

16 after ‘‘eligible organization’’, and

17 (ii) in clause (i), by inserting ‘‘or under a

18 contract under part D, ’’ after ‘‘1972,’’.

19 (B) Section 1882(g)(1) (42 U.S.C.

20 1395ww(g)(1)) is amended in the first sentence by in21 serting ‘‘, or under a medicare choice plan under part

22 D’’ before the end period.

23 (d) EFFECTIVE DATE.—The amendments made by this

24 section shall apply with respect to contracts effective on and

25 after January 1, 1997.
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1 SEC. 7002. TREATMENT OF 1876 ORGANIZATIONS.

2 (a) TERMINATION OF 1876 RISK-SHARING ORGANIZA3 TIONS.—Section 1876 (42 U.S.C. 1395mm) is amended by

4 adding at the end the following new subsection:

5 ‘‘(k)(1) Except as provided in paragraph (2), this sec6 tion shall not apply to risk-sharing contracts effective for

7 contract years beginning on or after January 1, 1997.

8 ‘‘(2) An individual who is enrolled in part B only and

9 is enrolled in an eligible organization with a risk-sharing

10 contract under this section on December 31, 1996, may con11 tinue enrollment in such organization. Not later then July