PUBLIC LAW 106–554—DEC. 21, 2000 114 STAT. 2763

* See Endnote on 114 Stat. 2764.

*Public Law 106–554

106th Congress

An Act

Making consolidated appropriations for the fiscal year ending September 30, 2001,

and for other purposes.

Be it enacted by the Senate and House of Representatives of

the United States of America in Congress assembled,

SECTION 1. (a) The provisions of the following bills of the

106th Congress are hereby enacted into law:

(1) H.R. 5656, as introduced on December 14, 2000.

(2) H.R. 5657, as introduced on December 14, 2000.

(3) H.R. 5658, as introduced on December 14, 2000.

(4) H.R. 5666, as introduced on December 15, 2000, except

that the text of H.R. 5666, as so enacted, shall not include

section 123 (relating to the enactment of H.R. 4904).

(5) H.R. 5660, as introduced on December 14, 2000.

(6) H.R. 5661, as introduced on December 14, 2000.

(7) H.R. 5662, as introduced on December 14, 2000.

(8) H.R. 5663, as introduced on December 14, 2000.

(9) H.R. 5667, as introduced on December 15, 2000.

(b) In publishing this Act in slip form and in the United

States Statutes at Large pursuant to section 112 of title 1, United

States Code, the Archivist of the United States shall include after

the date of approval at the end appendixes setting forth the texts

of the bills referred to in subsection (a) of this section and the

text of any other bill enacted into law by reference by reason

of the enactment of this Act.

SEC. 2. (a) Notwithstanding Rule 3 of the Budget Scorekeeping

Guidelines set forth in the joint explanatory statement of the

committee of conference accompanying Conference Report 105–217,

legislation enacted in section 505 of the Department of Transportation and Related Agencies Appropriations Act, 2001, section 312

of the Legislative Branch Appropriations Act, 2001, titles X and

XI of H.R. 5548 (106th Congress) as enacted by H.R. 4942 (106th

Congress), division B of H.R. 5666 (106th Congress) as enacted

by this Act, and sections 1(a)(5) through 1(a)(9) of this Act that

would have been estimated by the Office of Management and Budget

as changing direct spending or receipts under section 252 of the

Balanced Budget and Emergency Deficit Control Act of 1985 were

it included in an Act other than an appropriations Act shall be

treated as direct spending or receipts legislation, as appropriate,

under section 252 of the Balanced Budget and Emergency Deficit

Control Act of 1985.

(b) In preparing the final sequestration report required by

section 254(f )(3) of the Balanced Budget and Emergency Deficit

Control Act of 1985 for fiscal year 2001, in addition to the information required by that section, the Director of the Office of Management and Budget shall change any balance of direct spending

Publication.

1 USC 112 note.

Incorporation by

reference.

Consolidated

Appropriations

Act, 2001.

Dec. 21, 2000

[H.R. 4577]

114 STAT. 2764 PUBLIC LAW 106–554—DEC. 21, 2000

LEGISLATIVE HISTORY—H.R. 4577 (S. 2553):

HOUSE REPORTS: Nos. 106–645 (Comm. on Appropriations) and 106–1033 (Comm.

of Conference).

SENATE REPORTS: No. 106–293 accompanying S. 2553 (Comm. on Appropriations).

CONGRESSIONAL RECORD, Vol. 146 (2000):

June 8, 12–14, considered and passed House.

June 22, 23, 26–30, considered and passed Senate, amended.

Dec. 15, House and Senate agreed to conference report.

WEEKLY COMPILATION OF PRESIDENTIAL DOCUMENTS, Vol. 36 (2000):

Dec. 21, Presidential remarks and statement.

*ENDNOTE: The following appendixes were added pursuant to the provisions of section 1

of this Act (114 Stat. 2763).

Æ

and receipts legislation for fiscal year 2001 under section 252 of

that Act to zero.

(c) This Act may be cited as the ‘‘Consolidated Appropriations

Act, 2001’’.

Approved December 21, 2000.

PUBLIC LAW 106–554—APPENDIX 114 STAT. 2763A–1

TABLE OF CONTENTS

The table of contents is as follows:

APPENDIX A—H.R. 5656

APPENDIX B—H.R. 5657

APPENDIX C—H.R. 5658

APPENDIX D—H.R. 5666

APPENDIX D–1—S. 2273

APPENDIX D–2—S. 2885

APPENDIX E—H.R. 5660

APPENDIX F—H.R. 5661

APPENDIX G—H.R. 5662

APPENDIX H—H.R. 5663

APPENDIX I—H.R. 5667

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–3

APPENDIX A—H.R. 5656

That the following sums are appropriated, out of any money in

the Treasury not otherwise appropriated, for the Departments of

Labor, Health and Human Services, and Education, and related

agencies for the fiscal year ending September 30, 2001, and for

other purposes, namely:

TITLE I—DEPARTMENT OF LABOR

EMPLOYMENT AND TRAINING ADMINISTRATION

TRAINING AND EMPLOYMENT SERVICES

For necessary expenses of the Workforce Investment Act,

including the purchase and hire of passenger motor vehicles, the

construction, alteration, and repair of buildings and other facilities,

and the purchase of real property for training centers as authorized

by the Workforce Investment Act; the Women in Apprenticeship

and Nontraditional Occupations Act; and the National Skill Standards Act of 1994; $3,207,805,000 plus reimbursements, of which

$1,808,465,000 is available for obligation for the period July 1,

2001 through June 30, 2002; of which $1,377,965,000 is available

for obligation for the period April 1, 2001 through June 30, 2002,

including $1,102,965,000 to carry out chapter 4 of the Workforce

Investment Act and $275,000,000 to carry out section 169 of such

Act; and of which $20,375,000 is available for the period July

1, 2001 through June 30, 2004 for necessary expenses of construction, rehabilitation, and acquisition of Job Corps centers: Provided, That $9,098,000 shall be for carrying out section 172 of the

Workforce Investment Act, and $3,500,000 shall be for carrying

out the National Skills Standards Act of 1994: Provided further, That no funds from any other appropriation shall be used to provide

meal services at or for Job Corps centers: Provided further, That

funds provided to carry out section 171(d) of such Act may be

used for demonstration projects that provide assistance to new

entrants in the workforce and incumbent workers: Provided further, That funding provided to carry out projects under section 171

of the Workforce Investment Act of 1998 that are identified in

the Conference Agreement, shall not be subject to the requirements

of section 171(b)(2)(B) of such Act, the requirements of section

171(c)(4)(D) of such Act, or the joint funding requirements of sections 171(b)(2)(A) and 171(c)(4)(A) of such Act: Provided further, That funding appropriated herein for Dislocated Worker Employment and Training Activities under section 132(a)(2)(A) of the

Workforce Investment Act of 1998 may be distributed for Dislocated

Worker Projects under section 171(d) of the Act without regard

to the 10 percent limitation contained in section 171(d) of the

114 STAT. 2763A–4 PUBLIC LAW 106–554—APPENDIX A

Act: Provided further, That of the funds made available for Job

Corps operating expenses in the Department of Labor Appropriations Act, 2000, as enacted by section 1000(a)(4) of Public Law

106–113, $586,487 shall be paid to the city of Vergennes, Vermont

in settlement of the city’s claim: Provided further, That $4,600,000

provided herein for dislocated worker employment and training

activities shall be made available to the New Mexico Telecommunications Call Center Training Consortium for training in telecommunications-related occupations.

For necessary expenses of the Workforce Investment Act,

including the purchase and hire of passenger motor vehicles, the

construction, alteration, and repair of buildings and other facilities,

and the purchase of real property for training centers as authorized

by the Workforce Investment Act; $2,463,000,000 plus reimbursements, of which $2,363,000,000 is available for obligation for the

period October 1, 2001 through June 30, 2002, and of which

$100,000,000 is available for the period October 1, 2001 through

June 30, 2004, for necessary expenses of construction, rehabilitation,

and acquisition of Job Corps centers.

COMMUNITY SERVICE EMPLOYMENT FOR OLDER AMERICANS

To carry out title V of the Older Americans Act of 1965, as

amended, $440,200,000.

FEDERAL UNEMPLOYMENT BENEFITS AND ALLOWANCES

For payments during the current fiscal year of trade adjustment

benefit payments and allowances under part I; and for training,

allowances for job search and relocation, and related State administrative expenses under part II, subchapters B and D, chapter 2,

title II of the Trade Act of 1974, as amended, $406,550,000, together

with such amounts as may be necessary to be charged to the

subsequent appropriation for payments for any period subsequent

to September 15 of the current year.

STATE UNEMPLOYMENT INSURANCE AND EMPLOYMENT SERVICE

OPERATIONS

For authorized administrative expenses, $193,452,000, together

with not to exceed $3,172,246,000 (including not to exceed

$1,228,000 which may be used for amortization payments to States

which had independent retirement plans in their State employment

service agencies prior to 1980), which may be expended from the

Employment Security Administration account in the Unemployment

Trust Fund including the cost of administering section 51 of the

Internal Revenue Code of 1986, as amended, section 7(d) of the

Wagner-Peyser Act, as amended, the Trade Act of 1974, as amended,

the Immigration Act of 1990, and the Immigration and Nationality

Act, as amended, and of which the sums available in the allocation

for activities authorized by title III of the Social Security Act,

as amended (42 U.S.C. 502–504), and the sums available in the

allocation for necessary administrative expenses for carrying out

5 U.S.C. 8501–8523, shall be available for obligation by the States

through December 31, 2001, except that funds used for automation

acquisitions shall be available for obligation by the States through

September 30, 2003; and of which $193,452,000, together with

not to exceed $773,283,000 of the amount which may be expended

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–5

from said trust fund, shall be available for obligation for the period

July 1, 2001 through June 30, 2002, to fund activities under the

Act of June 6, 1933, as amended, including the cost of penalty

mail authorized under 39 U.S.C. 3202(a)(1)(E) made available to

States in lieu of allotments for such purpose: Provided, That to

the extent that the Average Weekly Insured Unemployment (AWIU)

for fiscal year 2001 is projected by the Department of Labor to

exceed 2,396,000, an additional $28,600,000 shall be available for

obligation for every 100,000 increase in the AWIU level (including

a pro rata amount for any increment less than 100,000) from

the Employment Security Administration Account of the Unemployment Trust Fund: Provided further, That funds appropriated in

this Act which are used to establish a national one-stop career

center system, or which are used to support the national activities

of the Federal-State unemployment insurance programs, may be

obligated in contracts, grants, or agreements with non-State entities: Provided further, That funds appropriated under this Act for

activities authorized under the Wagner-Peyser Act, as amended,

and title III of the Social Security Act, may be used by the States

to fund integrated Employment Service and Unemployment Insurance automation efforts, notwithstanding cost allocation principles

prescribed under Office of Management and Budget Circular A–

87.

ADVANCES TO THE UNEMPLOYMENT TRUST FUND AND OTHER FUNDS

For repayable advances to the Unemployment Trust Fund as

authorized by sections 905(d) and 1203 of the Social Security Act,

as amended, and to the Black Lung Disability Trust Fund as

authorized by section 9501(c)(1) of the Internal Revenue Code of

1954, as amended; and for nonrepayable advances to the Unemployment Trust Fund as authorized by section 8509 of title 5, United

States Code, and to the ‘‘Federal unemployment benefits and allowances’’ account, to remain available until September 30, 2002,

$435,000,000.

In addition, for making repayable advances to the Black Lung

Disability Trust Fund in the current fiscal year after September

15, 2001, for costs incurred by the Black Lung Disability Trust

Fund in the current fiscal year, such sums as may be necessary.

PROGRAM ADMINISTRATION

For expenses of administering employment and training programs, $110,651,000, including $6,431,000 to support up to 75

full-time equivalent staff, the majority of which will be term Federal

appointments lasting no more than 1 year, to administer welfareto-work grants, together with not to exceed $48,507,000, which

may be expended from the Employment Security Administration

account in the Unemployment Trust Fund.

PENSION AND WELFARE BENEFITS ADMINISTRATION

SALARIES AND EXPENSES

For necessary expenses for the Pension and Welfare Benefits

Administration, $107,832,000.

114 STAT. 2763A–6 PUBLIC LAW 106–554—APPENDIX A

PENSION BENEFIT GUARANTY CORPORATION

PENSION BENEFIT GUARANTY CORPORATION FUND

The Pension Benefit Guaranty Corporation is authorized to

make such expenditures, including financial assistance authorized

by section 104 of Public Law 96–364, within limits of funds and

borrowing authority available to such Corporation, and in accord

with law, and to make such contracts and commitments without

regard to fiscal year limitations as provided by section 104 of

the Government Corporation Control Act, as amended (31 U.S.C.

9104), as may be necessary in carrying out the program through

September 30, 2001, for such Corporation: Provided, That not to

exceed $11,652,000 shall be available for administrative expenses

of the Corporation: Provided further, That expenses of such Corporation in connection with the termination of pension plans, for the

acquisition, protection or management, and investment of trust

assets, and for benefits administration services shall be considered

as nonadministrative expenses for the purposes hereof, and excluded

from the above limitation.

EMPLOYMENT STANDARDS ADMINISTRATION

SALARIES AND EXPENSES

For necessary expenses for the Employment Standards

Administration, including reimbursement to State, Federal, and

local agencies and their employees for inspection services rendered,

$361,491,000, together with $1,985,000 which may be expended

from the Special Fund in accordance with sections 39(c), 44(d),

and 44( j) of the Longshore and Harbor Workers’ Compensation

Act: Provided, That $2,000,000 shall be for the development of

an alternative system for the electronic submission of reports

required to be filed under the Labor-Management Reporting and

Disclosure Act of 1959, as amended, and for a computer database

of the information for each submission by whatever means, that

is indexed and easily searchable by the public via the Internet:

Provided further, That the Secretary of Labor is authorized to

accept, retain, and spend, until expended, in the name of the

Department of Labor, all sums of money ordered to be paid to

the Secretary of Labor, in accordance with the terms of the Consent

Judgment in Civil Action No. 91–0027 of the United States District

Court for the District of the Northern Mariana Islands (May 21,

1992): Provided further, That the Secretary of Labor is authorized

to establish and, in accordance with 31 U.S.C. 3302, collect and

deposit in the Treasury fees for processing applications and issuing

certificates under sections 11(d) and 14 of the Fair Labor Standards

Act of 1938, as amended (29 U.S.C. 211(d) and 214) and for processing applications and issuing registrations under title I of the

Migrant and Seasonal Agricultural Worker Protection Act (29 U.S.C.

1801 et seq.).

SPECIAL BENEFITS

(INCLUDING TRANSFER OF FUNDS)

For the payment of compensation, benefits, and expenses

(except administrative expenses) accruing during the current or

any prior fiscal year authorized by title 5, chapter 81 of the United

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–7

States Code; continuation of benefits as provided for under the

heading ‘‘Civilian War Benefits’’ in the Federal Security Agency

Appropriation Act, 1947; the Employees’ Compensation Commission

Appropriation Act, 1944; sections 4(c) and 5(f ) of the War Claims

Act of 1948 (50 U.S.C. App. 2012); and 50 percent of the additional

compensation and benefits required by section 10(h) of the

Longshore and Harbor Workers’ Compensation Act, as amended, $56,000,000 together with such amounts as may be necessary to

be charged to the subsequent year appropriation for the payment

of compensation and other benefits for any period subsequent to

August 15 of the current year: Provided, That amounts appropriated

may be used under section 8104 of title 5, United States Code,

by the Secretary of Labor to reimburse an employer, who is not

the employer at the time of injury, for portions of the salary of

a reemployed, disabled beneficiary: Provided further, That balances

of reimbursements unobligated on September 30, 2000, shall remain

available until expended for the payment of compensation, benefits,

and expenses: Provided further, That in addition there shall be

transferred to this appropriation from the Postal Service and from

any other corporation or instrumentality required under section

8147(c) of title 5, United States Code, to pay an amount for its

fair share of the cost of administration, such sums as the Secretary

determines to be the cost of administration for employees of such

fair share entities through September 30, 2001: Provided further, That of those funds transferred to this account from the fair share

entities to pay the cost of administration, $34,910,000 shall be

made available to the Secretary as follows: (1) for the operation

of and enhancement to the automated data processing systems,

including document imaging, medical bill review, and periodic roll

management, in support of Federal Employees’ Compensation Act

administration, $23,371,000; (2) for conversion to a paperless office,

$7,005,000; (3) for communications redesign, $1,750,000; (4) for

information technology maintenance and support, $2,784,000; and

(5) the remaining funds shall be paid into the Treasury as miscellaneous receipts: Provided further, That the Secretary may

require that any person filing a notice of injury or a claim for

benefits under chapter 81 of title 5, United States Code, or 33

U.S.C. 901 et seq., provide as part of such notice and claim, such

identifying information (including Social Security account number)

as such regulations may prescribe.

BLACK LUNG DISABILITY TRUST FUND

(INCLUDING TRANSFER OF FUNDS)

For payments from the Black Lung Disability Trust Fund,

$1,028,000,000, of which $975,343,000 shall be available until

September 30, 2002, for payment of all benefits as authorized

by section 9501(d)(1), (2), (4), and (7) of the Internal Revenue

Code of 1954, as amended, and interest on advances as authorized

by section 9501(c)(2) of that Act, and of which $30,393,000 shall

be available for transfer to Employment Standards Administration,

Salaries and Expenses, $21,590,000 for transfer to Departmental

Management, Salaries and Expenses, $318,000 for transfer to

Departmental Management, Office of Inspector General, and

$356,000 for payment into miscellaneous receipts for the expenses

of the Department of the Treasury, for expenses of operation and

administration of the Black Lung Benefits program as authorized

114 STAT. 2763A–8 PUBLIC LAW 106–554—APPENDIX A

by section 9501(d)(5) of that Act: Provided, That, in addition, such

amounts as may be necessary may be charged to the subsequent

year appropriation for the payment of compensation, interest, or

other benefits for any period subsequent to August 15 of the current

year.

OCCUPATIONAL SAFETY AND HEALTH ADMINISTRATION

SALARIES AND EXPENSES

For necessary expenses for the Occupational Safety and Health Administration, $425,983,000, including not to exceed $88,493,000

which shall be the maximum amount available for grants to States

under section 23(g) of the Occupational Safety and Health Act,

which grants shall be no less than 50 percent of the costs of

State occupational safety and health programs required to be

incurred under plans approved by the Secretary under section 18

of the Occupational Safety and Health Act of 1970; and, in addition,

notwithstanding 31 U.S.C. 3302, the Occupational Safety and

Health Administration may retain up to $750,000 per fiscal year

of training institute course tuition fees, otherwise authorized by

law to be collected, and may utilize such sums for occupational

safety and health training and education grants: Provided, That,

notwithstanding 31 U.S.C. 3302, the Secretary of Labor is authorized, during the fiscal year ending September 30, 2001, to collect

and retain fees for services provided to Nationally Recognized Testing Laboratories, and may utilize such sums, in accordance with

the provisions of 29 U.S.C. 9a, to administer national and international laboratory recognition programs that ensure the safety

of equipment and products used by workers in the workplace:

Provided further, That none of the funds appropriated under this

paragraph shall be obligated or expended to prescribe, issue, administer, or enforce any standard, rule, regulation, or order under

the Occupational Safety and Health Act of 1970 which is applicable

to any person who is engaged in a farming operation which does

not maintain a temporary labor camp and employs 10 or fewer

employees: Provided further, That no funds appropriated under

this paragraph shall be obligated or expended to administer or

enforce any standard, rule, regulation, or order under the Occupational Safety and Health Act of 1970 with respect to any employer

of 10 or fewer employees who is included within a category having

an occupational injury lost workday case rate, at the most precise

Standard Industrial Classification Code for which such data are

published, less than the national average rate as such rates are

most recently published by the Secretary, acting through the Bureau

of Labor Statistics, in accordance with section 24 of that Act (29

U.S.C. 673), except—

(1) to provide, as authorized by such Act, consultation,

technical assistance, educational and training services, and to

conduct surveys and studies;

(2) to conduct an inspection or investigation in response

to an employee complaint, to issue a citation for violations

found during such inspection, and to assess a penalty for violations which are not corrected within a reasonable abatement

period and for any willful violations found;

(3) to take any action authorized by such Act with respect

to imminent dangers;

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–9

(4) to take any action authorized by such Act with respect

to health hazards;

(5) to take any action authorized by such Act with respect

to a report of an employment accident which is fatal to one

or more employees or which results in hospitalization of two

or more employees, and to take any action pursuant to such

investigation authorized by such Act; and

(6) to take any action authorized by such Act with respect

to complaints of discrimination against employees for exercising

rights under such Act:

Provided further, That the foregoing proviso shall not apply to

any person who is engaged in a farming operation which does

not maintain a temporary labor camp and employs 10 or fewer

employees.

MINE SAFETY AND HEALTH ADMINISTRATION

SALARIES AND EXPENSES

For necessary expenses for the Mine Safety and Health

Administration, $246,747,000, including purchase and bestowal of

certificates and trophies in connection with mine rescue and firstaid work, and the hire of passenger motor vehicles; including up

to $1,000,000 for mine rescue and recovery activities, which shall

be available only to the extent that fiscal year 2001 obligations

for these activities exceed $1,000,000; in addition, not to exceed

$750,000 may be collected by the National Mine Health and Safety

Academy for room, board, tuition, and the sale of training materials,

otherwise authorized by law to be collected, to be available for

mine safety and health education and training activities, notwithstanding 31 U.S.C. 3302; and, in addition, the Mine Safety and

Health Administration may retain up to $1,000,000 from fees collected for the approval and certification of equipment, materials,

and explosives for use in mines, and may utilize such sums for

such activities; the Secretary is authorized to accept lands, buildings, equipment, and other contributions from public and private

sources and to prosecute projects in cooperation with other agencies,

Federal, State, or private; the Mine Safety and Health Administration is authorized to promote health and safety education and

training in the mining community through cooperative programs

with States, industry, and safety associations; and any funds available to the department may be used, with the approval of the

Secretary, to provide for the costs of mine rescue and survival

operations in the event of a major disaster.

BUREAU OF LABOR STATISTICS

SALARIES AND EXPENSES

For necessary expenses for the Bureau of Labor Statistics,

including advances or reimbursements to State, Federal, and local

agencies and their employees for services rendered, $374,327,000,

together with not to exceed $67,257,000, which may be expended

from the Employment Security Administration account in the

Unemployment Trust Fund; and $10,000,000 which shall be available for obligation for the period July 1, 2001 through June 30,

2002, for Occupational Employment Statistics.

114 STAT. 2763A–10 PUBLIC LAW 106–554—APPENDIX A

DEPARTMENTAL MANAGEMENT

SALARIES AND EXPENSES

For necessary expenses for Departmental Management, including the hire of three sedans, and including the management or

operation, through contracts, grants, or other arrangements of

Departmental bilateral and multilateral foreign technical assistance, of which the funds designated to carry out bilateral assistance

under the international child labor initiative shall be available

for obligation through September 30, 2002, and $37,000,000 for

the acquisition of Departmental information technology, architecture, infrastructure, equipment, software, and related needs which

will be allocated by the Department’s Chief Information Officer

in accordance with the Department’s capital investment management process to assure a sound investment strategy, $380,529,000;

together with not to exceed $310,000, which may be expended

from the Employment Security Administration account in the

Unemployment Trust Fund: Provided, That no funds made available

by this Act may be used by the Solicitor of Labor to participate

in a review in any United States court of appeals of any decision

made by the Benefits Review Board under section 21 of the

Longshore and Harbor Workers’ Compensation Act (33 U.S.C. 921)

where such participation is precluded by the decision of the United

States Supreme Court in Director, Office of Workers’ Compensation

Programs v. Newport News Shipbuilding, 115 S. Ct. 1278 (1995),

notwithstanding any provisions to the contrary contained in Rule

15 of the Federal Rules of Appellate Procedure: Provided further,

That no funds made available by this Act may be used by the

Secretary of Labor to review a decision under the Longshore and

Harbor Workers’ Compensation Act (33 U.S.C. 901 et seq.) that

has been appealed and that has been pending before the Benefits

Review Board for more than 12 months: Provided further, That

any such decision pending a review by the Benefits Review Board

for more than 1 year shall be considered affirmed by the Benefits

Review Board on the 1-year anniversary of the filing of the appeal,

and shall be considered the final order of the Board for purposes

of obtaining a review in the United States courts of appeals: Provided further, That these provisions shall not be applicable to the

review or appeal of any decision issued under the Black Lung

Benefits Act (30 U.S.C. 901 et seq.): Provided further, That beginning in fiscal year 2001, there is established in the Department

of Labor an office of disability employment policy which shall,

under the overall direction of the Secretary, provide leadership,

develop policy and initiatives, and award grants furthering the

objective of eliminating barriers to the training and employment

of people with disabilities. Such office shall be headed by an Assistant Secretary: Provided further, That of amounts provided under

this head, not more than $23,002,000 is for this purpose.

VETERANS EMPLOYMENT AND TRAINING

Not to exceed $186,913,000 may be derived from the Employment Security Administration account in the Unemployment Trust

Fund to carry out the provisions of 38 U.S.C. 4100–4110A, 4212,

4214, and 4321–4327, and Public Law 103–353, and which shall

be available for obligation by the States through December 31,

2001. To carry out the Stewart B. McKinney Homeless Assistance

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–11

Act and section 168 of the Workforce Investment Act of 1998,

$24,800,000, of which $7,300,000 shall be available for obligation

for the period July 1, 2001 through June 30, 2002.

OFFICE OF INSPECTOR GENERAL

For salaries and expenses of the Office of Inspector General

in carrying out the provisions of the Inspector General Act of

1978, as amended, $50,015,000, together with not to exceed

$4,770,000, which may be expended from the Employment Security

Administration account in the Unemployment Trust Fund.

GENERAL PROVISIONS

SEC. 101. None of the funds appropriated in this title for

the Job Corps shall be used to pay the compensation of an individual, either as direct costs or any proration as an indirect cost,

at a rate in excess of Executive Level II.

(TRANSFER OF FUNDS)

SEC. 102. Not to exceed 1 percent of any discretionary funds

(pursuant to the Balanced Budget and Emergency Deficit Control

Act of 1985, as amended) which are appropriated for the current

fiscal year for the Department of Labor in this Act may be transferred between appropriations, but no such appropriation shall be

increased by more than 3 percent by any such transfer: Provided,

That the Appropriations Committees of both Houses of Congress

are notified at least 15 days in advance of any transfer.

SEC. 103. Section 403(a)(5)(C)(viii) of the Social Security Act

(42 U.S.C. 603(a)(5)(C)(viii)) (as amended by section 801(b)(1)(A)

of the Departments of Labor, Health and Human Services, and

Education, and Related Agencies Appropriations Act, 2000 (as

enacted into law by section 1000(a)(4) of Public Law 106–113))

is amended by striking ‘‘3 years’’ and inserting ‘‘5 years’’.

SEC. 104. No funds appropriated in this Act or any other

Act making appropriations for fiscal year 2001 may be used to

implement or enforce the proposed and final regulations appearing

in 65 Fed. Reg. 43528–43583, regarding temporary alien labor certification applications and petitions for admission of nonimmigrant

workers, or any similar or successor rule with an effective date

prior to October 1, 2001: Provided, That nothing in this section

shall prohibit the development or revision of such a rule, or the

publication of any similar or successor proposed or final rule, or

the provision of training or technical assistance, or other activities

necessary and appropriate in preparing to implement such a rule

with an effective date after September 30, 2001.

SEC. 105. Section 218(c)(4) of the Immigration and Nationality

Act (8 U.S.C. 1188(c)(4)) is amended by adding at the end the

following new sentence: ‘‘The determination as to whether the housing furnished by an employer for an H–2A worker meets the requirements imposed by this paragraph must be made prior to the date

specified in paragraph (3)(A) by which the Secretary of Labor is

required to make a certification described in subsection (a)(1) with

respect to a petition for the importation of such worker.’’.

SEC. 106. Section 286(s)(6) of the Immigration and Naturalization Act (8 U.S.C. 1356(s)(6)) is amended by inserting ‘‘and section

212(a)(5)(A)’’ after the second reference to ‘‘section 212(n)(1)’’.

114 STAT. 2763A–12 PUBLIC LAW 106–554—APPENDIX A

SEC. 107. (a) Section 403(a)(5) of the Social Security Act (as

amended by section 806(b) of the Departments of Labor, Health

and Human Services, and Education, and Related Agencies Appropriations Act, 2000 (as enacted into law by section 1000(a)(4) of

Public Law 106–113)) is amended by striking subparagraph (E)

and redesignating subparagraphs (F) through (K) as subparagraphs

(E) through (J), respectively.

(b) The Social Security Act (as amended by section 806(b)

of the Departments of Labor, Health and Human Services, and

Education, and Related Agencies Appropriations Act, 2000 (as

enacted into law by section 1000(a)(4) of Public Law 106–113))

is further amended as follows:

(1) Section 403(a)(5)(A)(i) (42 U.S.C. 603(a)(5)(A)(i)) is

amended by striking ‘‘subparagraph (I)’’ and inserting ‘‘subparagraph (H)’’. (2) Subclause (I) of each of subparagraphs (A)(iv) and (B)(v)

of section 403(a)(5) (42 U.S.C. 603(a)(5)(A)(iv)(I) and (B)(v)(I))

is amended— (A) in item (aa)— (i) by striking ‘‘(I)’’ and inserting ‘‘(H)’’; and

(ii) by striking ‘‘(G), and (H)’’ and inserting ‘‘and

(G)’’; and

(B) in item (bb), by striking ‘‘(F)’’ and inserting ‘‘(E)’’. (3) Section 403(a)(5)(B)(v) (42 U.S.C. 603(a)(5)(B)(v)) is

amended in the matter preceding subclause (I) by striking

‘‘(I)’’ and inserting ‘‘(H)’’. (4) Subparagraphs (E), (F), and (G)(i) of section 403(a)(5)

(42 U.S.C. 603(a)(5)), as so redesignated by subsection (a) of

this section, are each amended by striking ‘‘(I)’’ and inserting ‘‘(H)’’.

(5) Section 412(a)(3)(A) (42 U.S.C. 612(a)(3)(A)) is amended

by striking ‘‘403(a)(5)(I)’’ and inserting ‘‘403(a)(5)(H)’’. (c) Section 403(a)(5)(H)(i)(II) of such Act (42 U.S.C.

603(a)(5)(H)(i)(II)) (as redesignated by subsection (a) of this section

and as amended by section 806(b) of the Departments of Labor,

Health and Human Services, and Education, and Related Agencies

Appropriations Act, 2000 (as enacted into law by section 1000(a)(4)

of Public Law 106–113)) is further amended by striking ‘‘$1,450,000,000’’ and inserting ‘‘$1,400,000,000’’. (d) The amendments made by subsections (a), (b), and (c) of

this section shall take effect on October 1, 2000.

This title may be cited as the ‘‘Department of Labor Appropriations Act, 2001’’.

TITLE II—DEPARTMENT OF HEALTH AND HUMAN

SERVICES

HEALTH RESOURCES AND SERVICES ADMINISTRATION

HEALTH RESOURCES AND SERVICES

For carrying out titles II, III, VII, VIII, X, XII, XIX, and

XXVI of the Public Health Service Act, section 427(a) of the Federal

Coal Mine Health and Safety Act, title V and section 1820 of

the Social Security Act, the Health Care Quality Improvement

Act of 1986, as amended, the Native Hawaiian Health Care Act

of 1988, as amended, and the Poison Control Center Enhancement

and Awareness Act, $5,525,476,000, of which $226,224,000 shall

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–13

be available for the construction and renovation of health care

and other facilities, and of which $25,000,000 from general revenues, notwithstanding section 1820( j) of the Social Security Act,

shall be available for carrying out the Medicare rural hospital

flexibility grants program under section 1820 of such Act: Provided,

That the Division of Federal Occupational Health may utilize personal services contracting to employ professional management/

administrative and occupational health professionals: Provided further, That of the funds made available under this heading, $250,000

shall be available until expended for facilities renovations at the

Gillis W. Long Hansen’s Disease Center: Provided further, That

in addition to fees authorized by section 427(b) of the Health Care

Quality Improvement Act of 1986, fees shall be collected for the

full disclosure of information under the Act sufficient to recover

the full costs of operating the National Practitioner Data Bank,

and shall remain available until expended to carry out that Act:

Provided further, That fees collected for the full disclosure of

information under the ‘‘Health Care Fraud and Abuse Data Collection Program,’’ authorized by section 1128E(d)(2) of the Social Security Act, shall be sufficient to recover the full costs of operating

the program, and shall remain available until expended to carry

out that Act: Provided further, That no more than $5,000,000 is

available for carrying out the provisions of Public Law 104–73:

Provided further, That of the funds made available under this

heading, $253,932,000 shall be for the program under title X of

the Public Health Service Act to provide for voluntary family planning projects: Provided further, That amounts provided to said

projects under such title shall not be expended for abortions, that

all pregnancy counseling shall be nondirective, and that such

amounts shall not be expended for any activity (including the

publication or distribution of literature) that in any way tends

to promote public support or opposition to any legislative proposal

or candidate for public office: Provided further, That $589,000,000

shall be for State AIDS Drug Assistance Programs authorized by

section 2616 of the Public Health Service Act: Provided further,

That of the amount provided under this heading, $700,000 shall

be for the American Federation of Negro Affairs Education and

Research Fund of Philadelphia, $900,000 shall be for the Des Moines

University Osteopathic Medical Center, $250,000 shall be for the

University of Alaska, Anchorage, to train Alaska Natives as

psychologists, $900,000 shall be for Northeastern University in

Boston, Massachusetts, to train doctors to serve in low-income

communities, $500,000 shall be for the University of Alaska,

Anchorage, to recruit and train nurses in rural areas, and $230,000

shall be for the Illinois Poison Center: Provided further, That,

notwithstanding section 502(a)(1) of the Social Security Act, not

to exceed $113,728,000 is available for carrying out special projects

of regional and national significance pursuant to section 501(a)(2)

of such Act, of which $5,000,000 is for Columbia Hospital for Women

Medical Center in Washington, D.C., to support community outreach

programs for women, $5,000,000 is for continuation of the traumatic

brain injury State demonstration projects, and $100,000 is for St.

Joseph’s Health Services of Rhode Island for the Providence Smiles

dental program for low-income children.

For special projects of regional and national significance under

section 501(a)(2) of the Social Security Act, $30,000,000, which

114 STAT. 2763A–14 PUBLIC LAW 106–554—APPENDIX A

shall become available on October 1, 2001, and shall remain available until September 30, 2002: Provided, That such amount shall

not be counted toward compliance with the allocation required

in section 502(a)(1) of such Act: Provided further, That such amount

shall be used only for making competitive grants to provide

abstinence education (as defined in section 510(b)(2) of such Act)

to adolescents and for evaluations (including longitudinal evaluations) of activities under the grants and for Federal costs of administering the grants: Provided further, That grants shall be made

only to public and private entities which agree that, with respect

to an adolescent to whom the entities provide abstinence education

under such grant, the entities will not provide to that adolescent

any other education regarding sexual conduct, except that, in the

case of an entity expressly required by law to provide health

information or services the adolescent shall not be precluded from

seeking health information or services from the entity in a different

setting than the setting in which the abstinence education was

provided: Provided further, That the funds expended for such

evaluations may not exceed 3.5 percent of such amount.

HEALTH EDUCATION ASSISTANCE LOANS PROGRAM

Such sums as may be necessary to carry out the purpose

of the program, as authorized by title VII of the Public Health

Service Act, as amended. For administrative expenses to carry

out the guaranteed loan program, including section 709 of the

Public Health Service Act, $3,679,000.

VACCINE INJURY COMPENSATION PROGRAM TRUST FUND

For payments from the Vaccine Injury Compensation Program

Trust Fund, such sums as may be necessary for claims associated

with vaccine-related injury or death with respect to vaccines

administered after September 30, 1988, pursuant to subtitle 2 of

title XXI of the Public Health Service Act, to remain available

until expended: Provided, That for necessary administrative

expenses, not to exceed $2,992,000 shall be available from the

Trust Fund to the Secretary of Health and Human Services.

CENTERS FOR DISEASE CONTROL AND PREVENTION

DISEASE CONTROL, RESEARCH, AND TRAINING

To carry out titles II, III, VII, XI, XV, XVII, XIX, and XXVI

of the Public Health Service Act, sections 101, 102, 103, 201, 202,

203, 301, and 501 of the Federal Mine Safety and Health Act

of 1977, sections 20, 21, and 22 of the Occupational Safety and

Health Act of 1970, title IV of the Immigration and Nationality

Act, and section 501 of the Refugee Education Assistance Act of

1980; including insurance of official motor vehicles in foreign countries; and hire, maintenance, and operation of aircraft,

$3,868,027,000, of which $175,000,000 shall remain available until

expended for the facilities master plan for equipment and construction and renovation of facilities, and in addition, such sums as

may be derived from authorized user fees, which shall be credited

to this account, and of which $104,527,000 for international HIV/

AIDS programs shall remain available until September 30, 2002:

Provided, That in addition to amounts provided herein, up to

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–15

$71,690,000 shall be available from amounts available under section

241 of the Public Health Service Act to carry out the National

Center for Health Statistics Surveys: Provided further, That none

of the funds made available for injury prevention and control at

the Centers for Disease Control and Prevention may be used to

advocate or promote gun control: Provided further, That the Director

may redirect the total amount made available under authority

of Public Law 101–502, section 3, dated November 3, 1990, to

activities the Director may so designate: Provided further, That

the Congress is to be notified promptly of any such transfer: Provided further, That not to exceed $10,000,000 may be available

for making grants under section 1509 of the Public Health Service

Act to not more than 15 States: Provided further, That notwithstanding any other provision of law, a single contract or related

contracts for development and construction of facilities may be

employed which collectively include the full scope of the project:

Provided further, That the solicitation and contract shall contain

the clause ‘‘availability of funds’’ found at 48 CFR 52.232–18: Provided further, That funds obligated for influenza vaccine stockpile

in fiscal year 2000 and fiscal year 2001 shall be considered as

appropriated under section 3 of Public Law 101–502.

NATIONAL INSTITUTES OF HEALTH

NATIONAL CANCER INSTITUTE

For carrying out section 301 and title IV of the Public Health

Service Act with respect to cancer, $3,757,242,000.

NATIONAL HEART, LUNG, AND BLOOD INSTITUTE

For carrying out section 301 and title IV of the Public Health

Service Act with respect to cardiovascular, lung, and blood diseases,

and blood and blood products, $2,299,866,000.

NATIONAL INSTITUTE OF DENTAL AND CRANIOFACIAL RESEARCH

For carrying out section 301 and title IV of the Public Health

Service Act with respect to dental disease, $306,448,000.

NATIONAL INSTITUTE OF DIABETES AND DIGESTIVE AND KIDNEY

DISEASES

For carrying out section 301 and title IV of the Public Health

Service Act with respect to diabetes and digestive and kidney disease, $1,303,385,000.

NATIONAL INSTITUTE OF NEUROLOGICAL DISORDERS AND STROKE

For carrying out section 301 and title IV of the Public Health

Service Act with respect to neurological disorders and stroke,

$1,176,482,000.

NATIONAL INSTITUTE OF ALLERGY AND INFECTIOUS DISEASES

For carrying out section 301 and title IV of the Public Health

Service Act with respect to allergy and infectious diseases,

$2,043,208,000.

114 STAT. 2763A–16 PUBLIC LAW 106–554—APPENDIX A

NATIONAL INSTITUTE OF GENERAL MEDICAL SCIENCES

For carrying out section 301 and title IV of the Public Health Service Act with respect to general medical sciences, $1,535,823,000.

NATIONAL INSTITUTE OF CHILD HEALTH AND HUMAN DEVELOPMENT

For carrying out section 301 and title IV of the Public Health

Service Act with respect to child health and human development,

$976,455,000.

NATIONAL EYE INSTITUTE

For carrying out section 301 and title IV of the Public Health

Service Act with respect to eye diseases and visual disorders,

$510,611,000.

NATIONAL INSTITUTE OF ENVIRONMENTAL HEALTH SCIENCES

For carrying out sections 301 and 311 and title IV of the

Public Health Service Act with respect to environmental health

sciences, $502,549,000.

NATIONAL INSTITUTE ON AGING

For carrying out section 301 and title IV of the Public Health

Service Act with respect to aging, $786,039,000.

NATIONAL INSTITUTE OF ARTHRITIS AND MUSCULOSKELETAL AND SKIN

DISEASES

For carrying out section 301 and title IV of the Public Health

Service Act with respect to arthritis and musculoskeletal and skin

diseases, $396,687,000.

NATIONAL INSTITUTE ON DEAFNESS AND OTHER COMMUNICATION

DISORDERS

For carrying out section 301 and title IV of the Public Health

Service Act with respect to deafness and other communication disorders, $300,581,000.

NATIONAL INSTITUTE OF NURSING RESEARCH

For carrying out section 301 and title IV of the Public Health

Service Act with respect to nursing research, $104,370,000.

NATIONAL INSTITUTE ON ALCOHOL ABUSE AND ALCOHOLISM

For carrying out section 301 and title IV of the Public Health

Service Act with respect to alcohol abuse and alcoholism,

$340,678,000.

NATIONAL INSTITUTE ON DRUG ABUSE

For carrying out section 301 and title IV of the Public Health Service Act with respect to drug abuse, $781,327,000.

NATIONAL INSTITUTE OF MENTAL HEALTH

For carrying out section 301 and title IV of the Public Health Service Act with respect to mental health, $1,107,028,000.

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–17

NATIONAL HUMAN GENOME RESEARCH INSTITUTE

For carrying out section 301 and title IV of the Public Health Service Act with respect to human genome research, $382,384,000.

NATIONAL CENTER FOR RESEARCH RESOURCES

For carrying out section 301 and title IV of the Public Health

Service Act with respect to research resources and general research

support grants, $817,475,000: Provided, That none of these funds

shall be used to pay recipients of the general research support

grants program any amount for indirect expenses in connection

with such grants: Provided further, That $75,000,000 shall be for

extramural facilities construction grants.

JOHN E. FOGARTY INTERNATIONAL CENTER

For carrying out the activities at the John E. Fogarty Inter- national Center, $50,514,000.

NATIONAL LIBRARY OF MEDICINE

For carrying out section 301 and title IV of the Public Health

Service Act with respect to health information communications,

$246,801,000, of which $4,000,000 shall be available until expended

for improvement of information systems: Provided, That in fiscal

year 2001, the Library may enter into personal services contracts

for the provision of services in facilities owned, operated, or constructed under the jurisdiction of the National Institutes of Health.

NATIONAL CENTER FOR COMPLEMENTARY AND ALTERNATIVE

MEDICINE

For carrying out section 301 and title IV of the Public Health

Service Act with respect to complementary and alternative medicine, $89,211,000.

NATIONAL CENTER ON MINORITY HEALTH AND HEALTH DISPARITIES

For carrying out section 301 and title IV of the Public Health

Service Act with respect to minority health and health disparities

research, $130,200,000.

OFFICE OF THE DIRECTOR

(INCLUDING TRANSFER OF FUNDS)

For carrying out the responsibilities of the Office of the Director,

National Institutes of Health, $213,581,000, of which $48,271,000

shall be for the Office of AIDS Research: Provided, That funding

shall be available for the purchase of not to exceed 20 passenger

motor vehicles for replacement only: Provided further, That the

Director may direct up to 1 percent of the total amount made

available in this or any other Act to all National Institutes of

Health appropriations to activities the Director may so designate:

Provided further, That no such appropriation shall be decreased

by more than 1 percent by any such transfers and that the Congress

is promptly notified of the transfer: Provided further, That the

National Institutes of Health is authorized to collect third party

payments for the cost of clinical services that are incurred in

114 STAT. 2763A–18 PUBLIC LAW 106–554—APPENDIX A

National Institutes of Health research facilities and that such payments shall be credited to the National Institutes of Health Management Fund: Provided further, That all funds credited to the National

Institutes of Health Management Fund shall remain available for

1 fiscal year after the fiscal year in which they are deposited:

Provided further, That up to $500,000 shall be available to carry

out section 499 of the Public Health Service Act: Provided further,

That, notwithstanding section 499(k)(10) of the Public Health Service Act, funds from the Foundation for the National Institutes

of Health may be transferred to the National Institutes of Health.

BUILDINGS AND FACILITIES

For the study of, construction of, and acquisition of equipment

for, facilities of or used by the National Institutes of Health, including the acquisition of real property, $153,790,000, to remain available until expended, of which $47,300,000 shall be for the National

Neuroscience Research Center: Provided, That notwithstanding any

other provision of law, a single contract or related contracts for

the development and construction of the first phase of the National

Neuroscience Research Center may be employed which collectively

include the full scope of the project: Provided further, That the

solicitation and contract shall contain the clause ‘‘availability of

funds’’ found at 48 CFR 52.232–18.

SUBSTANCE ABUSE AND MENTAL HEALTH SERVICES ADMINISTRATION

SUBSTANCE ABUSE AND MENTAL HEALTH SERVICES

For carrying out titles V and XIX of the Public Health Service

Act with respect to substance abuse and mental health services,

the Protection and Advocacy for Mentally Ill Individuals Act of

1986, and section 301 of the Public Health Service Act with respect

to program management, $2,958,001,000, of which $24,605,000 shall

be available for the projects and in the amounts specified in the

statement of the managers on the conference report accompanying

this Act.

AGENCY FOR HEALTHCARE RESEARCH AND QUALITY

HEALTHCARE RESEARCH AND QUALITY

For carrying out titles III and IX of the Public Health Service

Act, and part A of title XI of the Social Security Act, $104,963,000;

in addition, amounts received from Freedom of Information Act

fees, reimbursable and interagency agreements, and the sale of

data shall be credited to this appropriation and shall remain available until expended: Provided, That the amount made available

pursuant to section 926(b) of the Public Health Service Act shall

not exceed $164,980,000.

HEALTH CARE FINANCING ADMINISTRATION

GRANTS TO STATES FOR MEDICAID

For carrying out, except as otherwise provided, titles XI and

XIX of the Social Security Act, $93,586,251,000, to remain available

until expended.

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–19

For making, after May 31, 2001, payments to States under

title XIX of the Social Security Act for the last quarter of fiscal

year 2001 for unanticipated costs, incurred for the current fiscal

year, such sums as may be necessary.

For making payments to States or in the case of section 1928

on behalf of States under title XIX of the Social Security Act

for the first quarter of fiscal year 2002, $36,207,551,000, to remain

available until expended.

Payment under title XIX may be made for any quarter with

respect to a State plan or plan amendment in effect during such

quarter, if submitted in or prior to such quarter and approved

in that or any subsequent quarter.

PAYMENTS TO HEALTH CARE TRUST FUNDS

For payment to the Federal Hospital Insurance and the Federal

Supplementary Medical Insurance Trust Funds, as provided under

sections 217(g) and 1844 of the Social Security Act, sections 103(c)

and 111(d) of the Social Security Amendments of 1965, section

278(d) of Public Law 97–248, and for administrative expenses

incurred pursuant to section 201(g) of the Social Security Act,

$70,381,600,000.

PROGRAM MANAGEMENT

For carrying out, except as otherwise provided, titles XI, XVIII,

XIX, and XXI of the Social Security Act, titles XIII and XXVII

of the Public Health Service Act, and the Clinical Laboratory

Improvement Amendments of 1988, not to exceed $2,246,326,000,

to be transferred from the Federal Hospital Insurance and the

Federal Supplementary Medical Insurance Trust Funds, as authorized by section 201(g) of the Social Security Act; together with

all funds collected in accordance with section 353 of the Public

Health Service Act and such sums as may be collected from authorized user fees and the sale of data, which shall remain available

until expended, and together with administrative fees collected

relative to Medicare overpayment recovery activities, which shall

remain available until expended: Provided, That all funds derived

in accordance with 31 U.S.C. 9701 from organizations established

under title XIII of the Public Health Service Act shall be credited

to and available for carrying out the purposes of this appropriation:

Provided further, That $18,000,000 appropriated under this heading

for the managed care system redesign shall remain available until

expended: Provided further, That $20,000,000 of the amount available for research, demonstration, and evaluation activities shall

be available to continue carrying out demonstration projects on

Medicaid coverage of community-based attendant care services for

people with disabilities which ensures maximum control by the

consumer to select and manage their attendant care services: Provided further, That the Secretary of Health and Human Services

is directed to enter into an agreement with the Mind-Body Institute

of Boston, Massachusetts, to conduct a demonstration of a lifestyle

modification program: Provided further, That $2,800,000 of the

amount available for research, demonstration, and evaluation activities shall be awarded for administration, evaluation, quality monitoring and peer review of this lifestyle modification demonstration:

Provided further, That $2,800,000 of the amount available for

research, demonstration, and evaluation activities shall be awarded

114 STAT. 2763A–20 PUBLIC LAW 106–554—APPENDIX A

to a joint application from the University of Pittsburgh, Case Western Reserve in Cleveland, Ohio, and Mt. Sinai Hospital in Miami,

Florida, to use integrated nursing services and technology to implement daily monitoring of congestive heart failure patients in underserved populations in accordance with established clinical guidelines: Provided further, That $500,000 of the amount available

for research, demonstration, and evaluation activities shall be

awarded to the University of Pittsburgh Medical Center and University of Pennsylvania for a study of the efficacy of surgical versus

non-surgical management of abdominal aneurysms: Provided further, That $650,000 of the amount available for research, demonstration, and evaluation activities shall be awarded to the Vascular Surgery Outcome Initiative at Dartmouth College: Provided

further, That up to $300,000 of the amount available for research,

demonstration, and evaluation activities shall be awarded to the

United States-Mexico Border Counties Coalition for a study to determine the unreimbursed costs incurred to treat undocumented aliens

for medical emergencies in southwest border States, their border

counties, and hospitals within the jurisdiction of these States and

counties: Provided further, That $1,700,000 of the amount available

for research, demonstration, and evaluation activities shall be

awarded to the AIDS Healthcare Foundation in Los Angeles for

a demonstration of residential and outpatient treatment facilities:

Provided further, That $350,000 of the amount available for

research, demonstration, and evaluation activities shall be awarded

to the Cook County, Illinois Bureau of Health for the Asthma

Champion Initiative demonstration to reduce morbidity and mortality from asthma in high prevalence areas: Provided further, That

$1,000,000 of the amount available for research, demonstration,

and evaluation activities shall be awarded to the West Virginia

University School of Medicine’s Eye Center to test interventions

and improve the quality of life for individuals with low vision,

with a particular focus on the elderly: Provided further, That

$1,000,000 of the amount available for research, demonstration,

and evaluation activities shall be awarded to the Iowa Department

of Public Health for the establishment and operation of a mercantile

prescription drug purchasing cooperative or non-profit corporation

demonstration: Provided further, That $691,000 of the amount available for research, demonstration, and evaluation activities shall

be awarded to Ohio State University to determine the benefits

of compliance packaging: Provided further, That $855,000 of the

amount available for research, demonstration, and evaluation activities shall be awarded to Children’s Hospice International for a

demonstration project to provide a continuum of care for children

with life-threatening conditions and their families: Provided further,

That $921,000 of the amount available for research, demonstration,

and evaluation activities shall be awarded to Equip for Equality

for a demonstration project to document the impact of an independent investigative unit that will examine deaths or other serious

allegations of abuse and neglect of people with disabilities at facilities in Illinois: Provided further, That $1,000,000 of the amount

available for research, demonstration, and evaluation activities shall

be awarded to Duke University Medical Center to demonstrate

the potential savings in the Medicare program of a reimbursement

system based on preventative care: Provided further, That

$1,843,000 of the amount available for research, demonstration,

and evaluation activities shall be awarded to Bucks County,

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–21

Pennsylvania, for a health improvement project: Provided further,

That $255,000 of the amount available for research, demonstration,

and evaluation activities shall be awarded to the LA Care Health

Plan in Los Angeles, California, for a demonstration program to

improve clinical data coordination among Medicaid providers: Provided further, That $646,000 of the amount available for research,

demonstration, and evaluation activities shall be for the Shelby

County Regional Medical Center to establish a Master Patient

Index to determine patient Medicaid/TennCare eligibility: Provided

further, That the Secretary of Health and Human Services is

directed to collect fees in fiscal year 2001 from Medicare∂Choice

organizations pursuant to section 1857(e)(2) of the Social Security

Act and from eligible organizations with risk-sharing contracts

under section 1876 of that Act pursuant to section 1876(k)(4)(D)

of that Act.

HEALTH MAINTENANCE ORGANIZATION LOAN AND LOAN GUARANTEE

FUND

For carrying out subsections (d) and (e) of section 1308 of

the Public Health Service Act, any amounts received by the Secretary in connection with loans and loan guarantees under title

XIII of the Public Health Service Act, to be available without

fiscal year limitation for the payment of outstanding obligations.

During fiscal year 2001, no commitments for direct loans or loan

guarantees shall be made.

ADMINISTRATION FOR CHILDREN AND FAMILIES

PAYMENTS TO STATES FOR CHILD SUPPORT ENFORCEMENT AND

FAMILY SUPPORT PROGRAMS

For making payments to States or other non-Federal entities

under titles I, IV–D, X, XI, XIV, and XVI of the Social Security

Act and the Act of July 5, 1960 (24 U.S.C. ch. 9), $2,441,800,000,

to remain available until expended; and for such purposes for the

first quarter of fiscal year 2002, $1,000,000,000, to remain available

until expended.

For making payments to each State for carrying out the program of Aid to Families with Dependent Children under title IV–

A of the Social Security Act before the effective date of the program

of Temporary Assistance to Needy Families (TANF) with respect

to such State, such sums as may be necessary: Provided, That

the sum of the amounts available to a State with respect to expenditures under such title IV–A in fiscal year 1997 under this appropriation and under such title IV–A as amended by the Personal Responsibility and Work Opportunity Reconciliation Act of 1996 shall

not exceed the limitations under section 116(b) of such Act.

For making, after May 31 of the current fiscal year, payments

to States or other non-Federal entities under titles I, IV–D, X,

XI, XIV, and XVI of the Social Security Act and the Act of July

5, 1960 (24 U.S.C. ch. 9), for the last 3 months of the current

year for unanticipated costs, incurred for the current fiscal year,

such sums as may be necessary.

114 STAT. 2763A–22 PUBLIC LAW 106–554—APPENDIX A

LOW INCOME HOME ENERGY ASSISTANCE

For making payments under title XXVI of the Omnibus Budget

Reconciliation Act of 1981, in addition to amounts already appropriated for fiscal year 2001, $300,000,000.

For making payments under title XXVI of the Omnibus Rec- onciliation Act of 1981, $300,000,000: Provided, That these funds

are hereby designated by the Congress to be emergency requirements pursuant to section 251(b)(2)(A) of the Balanced Budget

and Emergency Deficit Control Act of 1985: Provided further, That

these funds shall be made available only after submission to the

Congress of a formal budget request by the President that includes

designation of the entire amount of the request as an emergency

requirement as defined in such Act.

REFUGEE AND ENTRANT ASSISTANCE

For making payments for refugee and entrant assistance activities authorized by title IV of the Immigration and Nationality

Act and section 501 of the Refugee Education Assistance Act of

1980 (Public Law 96–422), $423,109,000: Provided, That funds

appropriated pursuant to section 414(a) of the Immigration and

Nationality Act for fiscal year 2001 shall be available for the costs

of assistance provided and other activities through September 30,

2003: Provided further, That up to $5,000,000 is available to carry

out the Trafficking Victims Protection Act of 2000.

For carrying out section 5 of the Torture Victims Relief Act

of 1998 (Public Law 105–320), $10,000,000.

PAYMENTS TO STATES FOR THE CHILD CARE AND DEVELOPMENT

BLOCK GRANT

For carrying out sections 658A through 658R of the Omnibus

Budget Reconciliation Act of 1981 (The Child Care and Development

Block Grant Act of 1990), in addition to amounts already appropriated for fiscal year 2001, $817,328,000, such funds shall be

used to supplement, not supplant State general revenue funds

for child care assistance for low-income families: Provided, That

of the funds appropriated for fiscal year 2001, $19,120,000 shall

be available for child care resource and referral and school-aged

child care activities, of which $1,000,000 shall be for the Child

Care Aware toll free hotline: Provided further, That of the funds

appropriated for fiscal year 2001, in addition to the amounts

required to be reserved by the States under section 658G,

$272,672,000 shall be reserved by the States for activities authorized under section 658G, of which $100,000,000 shall be for activities that improve the quality of infant and toddler child care:

Provided further, That of the funds appropriated for fiscal year

2001, $10,000,000 shall be for use by the Secretary for child care

research, demonstration, and evaluation activities.

SOCIAL SERVICES BLOCK GRANT

For making grants to States pursuant to section 2002 of the

Social Security Act, $1,725,000,000: Provided, That notwithstanding

section 2003(c) of such Act, as amended, the amount specified

for allocation under such section for fiscal year 2001 shall be

$1,725,000,000: Provided further, That, notwithstanding subparagraph (B) of section 404(d)(2) of such Act, the applicable percent

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–23

specified under such subparagraph for a State to carry out State

programs pursuant to title XX of such Act shall be 10 percent.

CHILDREN AND FAMILIES SERVICES PROGRAMS

(INCLUDING RESCISSIONS)

For carrying out, except as otherwise provided, the Runaway

and Homeless Youth Act, the Developmental Disabilities Assistance

and Bill of Rights Act, the Head Start Act, the Child Abuse Prevention and Treatment Act, the Native American Programs Act of

1974, title II of Public Law 95–266 (adoption opportunities), the

Adoption and Safe Families Act of 1997 (Public Law 105–89), the

Abandoned Infants Assistance Act of 1988, the Early Learning

Opportunities Act, part B(1) of title IV and sections 413, 429A,

1110, and 1115 of the Social Security Act, and sections 40155,

40211, and 40241 of Public law 103–322; for making payments

under the Community Services Block Grant Act, section 473A of

the Social Security Act, and title IV of Public Law 105–285, and

for necessary administrative expenses to carry out said Acts and

titles I, IV, X, XI, XIV, XVI, and XX of the Social Security Act,

the Act of July 5, 1960 (24 U.S.C. ch. 9), the Omnibus Budget

Reconciliation Act of 1981, title IV of the Immigration and Nationality Act, section 501 of the Refugee Education Assistance Act of

1980, section 5 of the Torture Victims Relief Act of 1998 (Public

Law 105–320), sections 40155, 40211, and 40241 of Public Law

103–322 and section 126 and titles IV and V of Public Law 100–

485, $7,956,345,000, of which $43,000,000, to remain available until

September 30, 2002, shall be for grants to States for adoption

incentive payments, as authorized by section 473A of title IV of

the Social Security Act (42 U.S.C. 670–679) and may be made

for adoptions completed in fiscal years 1999 and 2000; of which

$682,876,000 shall be for making payments under the Community

Services Block Grant Act; and of which $6,200,000,000 shall be

for making payments under the Head Start Act, of which

$1,400,000,000 shall become available October 1, 2001 and remain

available through September 30, 2002: Provided, That to the extent

Community Services Block Grant funds are distributed as grant

funds by a State to an eligible entity as provided under the Act,

and have not been expended by such entity, they shall remain

with such entity for carryover into the next fiscal year for expenditure by such entity consistent with program purposes: Provided

further, That the Secretary shall establish procedures regarding

the disposition of intangible property which permits grant funds,

or intangible assets acquired with funds authorized under section

680 of the Community Services Block Grant Act, as amended,

to become the sole property of such grantees after a period of

not more than 12 years after the end of the grant for purposes

and uses consistent with the original grant.

Funds appropriated for fiscal year 2001 under section 429A(e),

part B of title IV of the Social Security Act shall be reduced

by $6,000,000.

Funds appropriated for fiscal year 2001 under section 413(h)(1)

of the Social Security Act shall be reduced by $15,000,000.

114 STAT. 2763A–24 PUBLIC LAW 106–554—APPENDIX A

PROMOTING SAFE AND STABLE FAMILIES

For carrying out section 430 of the Social Security Act, $305,000,000.

PAYMENTS TO STATES FOR FOSTER CARE AND ADOPTION ASSISTANCE

For making payments to States or other non-Federal entities

under title IV–E of the Social Security Act, $4,863,100,000.

For making payments to States or other non-Federal entities

under title IV–E of the Social Security Act, for the first quarter

of fiscal year 2002, $1,735,900,000.

ADMINISTRATION ON AGING

AGING SERVICES PROGRAMS

For carrying out, to the extent not otherwise provided, the

Older Americans Act of 1965, as amended, and section 398 of

the Public Health Service Act, $1,103,135,000, of which $5,000,000

shall be available for activities regarding medication management,

screening, and education to prevent incorrect medication and

adverse drug reactions: Provided, That notwithstanding section

308(b)(1) of the Older Americans Act of 1965, as amended, the

amounts available to each State for administration of the State

plan under title III of such Act shall be reduced not more than

5 percent below the amount that was available to such State for

such purpose for fiscal year 1995.

OFFICE OF THE SECRETARY

GENERAL DEPARTMENTAL MANAGEMENT

For necessary expenses, not otherwise provided, for general

departmental management, including hire of six sedans, and for

carrying out titles III, XVII, and XX of the Public Health Service

Act, and the United States-Mexico Border Health Commission Act,

$285,224,000, together with $5,851,000, to be transferred and

expended as authorized by section 201(g)(1) of the Social Security

Act from the Hospital Insurance Trust Fund and the Supplemental

Medical Insurance Trust Fund: Provided further, That of the funds

made available under this heading for carrying out title XX of

the Public Health Service Act, $10,377,000 shall be for activities

specified under section 2003(b)(2), of which $10,157,000 shall be

for prevention service demonstration grants under section 510(b)(2)

of title V of the Social Security Act, as amended, without application

of the limitation of section 2010(c) of said title XX: Provided further,

That no funds shall be obligated for minority AIDS prevention

and treatment activities until the Department of Health and Human

Services submits an operating plan to the House and Senate

Committees on Appropriations.

OFFICE OF INSPECTOR GENERAL

For expenses necessary for the Office of Inspector General

in carrying out the provisions of the Inspector General Act of

1978, as amended, $33,849,000: Provided, That of such amount,

necessary sums are available for providing protective services to

the Secretary and investigating non-payment of child support cases

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–25

for which non-payment is a Federal offense under 18 U.S.C. 228,

each of which activities is hereby authorized in this and subsequent

fiscal years.

OFFICE FOR CIVIL RIGHTS

For expenses necessary for the Office for Civil Rights,

$24,742,000, together with not to exceed $3,314,000, to be transferred and expended as authorized by section 201(g)(1) of the Social

Security Act from the Hospital Insurance Trust Fund and the

Supplemental Medical Insurance Trust Fund.

POLICY RESEARCH

For carrying out, to the extent not otherwise provided, research

studies under section 1110 of the Social Security Act, $16,738,000.

RETIREMENT PAY AND MEDICAL BENEFITS FOR COMMISSIONED

OFFICERS

For retirement pay and medical benefits of Public Health Service Commissioned Officers as authorized by law, for payments under

the Retired Serviceman’s Family Protection Plan and Survivor

Benefit Plan, for medical care of dependents and retired personnel

under the Dependents’ Medical Care Act (10 U.S.C. ch. 55), and

for payments pursuant to section 229(b) of the Social Security

Act (42 U.S.C. 429(b)), such amounts as may be required during

the current fiscal year.

PUBLIC HEALTH AND SOCIAL SERVICES EMERGENCY FUND

For expenses necessary to support activities related to countering potential biological, disease and chemical threats to civilian

populations, $241,231,000: Provided, That this amount is distributed as follows: Centers for Disease Control and Prevention,

$181,131,000, of which $32,000,000 shall be for the Health Alert

Network and $18,040,000 shall be for the continued study of the

anthrax vaccine; and Office of Emergency Preparedness,

$60,100,000.

GENERAL PROVISIONS

SEC. 201. Funds appropriated in this title shall be available

for not to exceed $37,000 for official reception and representation

expenses when specifically approved by the Secretary.

SEC. 202. The Secretary shall make available through assignment not more than 60 employees of the Public Health Service

to assist in child survival activities and to work in AIDS programs

through and with funds provided by the Agency for International

Development, the United Nations International Children’s Emergency Fund or the World Health Organization.

SEC. 203. None of the funds appropriated under this Act may

be used to implement section 399L(b) of the Public Health Service

Act or section 1503 of the National Institutes of Health Revitalization Act of 1993, Public Law 103–43.

SEC. 204. None of the funds appropriated in this Act for the

National Institutes of Health and the Substance Abuse and Mental

Health Services Administration shall be used to pay the salary

114 STAT. 2763A–26 PUBLIC LAW 106–554—APPENDIX A

of an individual, through a grant or other extramural mechanism,

at a rate in excess of Executive Level I.

SEC. 205. None of the funds appropriated in this Act may

be expended pursuant to section 241 of the Public Health Service

Act, except for funds specifically provided for in this Act, or for

other taps and assessments made by any office located in the

Department of Health and Human Services, prior to the Secretary’s

preparation and submission of a report to the Committee on Appropriations of the Senate and of the House detailing the planned

uses of such funds.

(TRANSFER OF FUNDS)

SEC. 206. Not to exceed 1 percent of any discretionary funds

(pursuant to the Balanced Budget and Emergency Deficit Control

Act of 1985, as amended) which are appropriated for the current

fiscal year for the Department of Health and Human Services

in this Act may be transferred between appropriations, but no

such appropriation shall be increased by more than 3 percent by

any such transfer: Provided, That the Appropriations Committees

of both Houses of Congress are notified at least 15 days in advance

of any transfer.

SEC. 207. The Director of the National Institutes of Health,

jointly with the Director of the Office of AIDS Research, may

transfer up to 3 percent among institutes, centers, and divisions

from the total amounts identified by these two Directors as funding

for research pertaining to the human immunodeficiency virus: Provided, That the Congress is promptly notified of the transfer.

SEC. 208. Of the amounts made available in this Act for the

National Institutes of Health, the amount for research related to

the human immunodeficiency virus, as jointly determined by the

Director of the National Institutes of Health and the Director of

the Office of AIDS Research, shall be made available to the ‘‘Office

of AIDS Research’’ account. The Director of the Office of AIDS

Research shall transfer from such account amounts necessary to

carry out section 2353(d)(3) of the Public Health Service Act.

SEC. 209. None of the funds appropriated in this Act may

be made available to any entity under title X of the Public Health

Service Act unless the applicant for the award certifies to the

Secretary that it encourages family participation in the decision

of minors to seek family planning services and that it provides

counseling to minors on how to resist attempts to coerce minors

into engaging in sexual activities.

SEC. 210. None of the funds appropriated by this Act (including

funds appropriated to any trust fund) may be used to carry out

the Medicare+Choice program if the Secretary denies participation

in such program to an otherwise eligible entity (including a Provider

Sponsored Organization) because the entity informs the Secretary

that it will not provide, pay for, provide coverage of, or provide

referrals for abortions: Provided, That the Secretary shall make

appropriate prospective adjustments to the capitation payment to

such an entity (based on an actuarially sound estimate of the

expected costs of providing the service to such entity’s enrollees):

Provided further, That nothing in this section shall be construed

to change the Medicare program’s coverage for such services and

a Medicare+Choice organization described in this section shall be

responsible for informing enrollees where to obtain information

about all Medicare covered services.

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–27

SEC. 211. Notwithstanding any other provision of law, no provider of services under title X of the Public Health Service Act

shall be exempt from any State law requiring notification or the

reporting of child abuse, child molestation, sexual abuse, rape,

or incest.

SEC. 212. The Foreign Operations, Export Financing, and

Related Programs Appropriations Act, 1990 (Public Law 101–167)

is amended—

(1) in section 599D (8 U.S.C. 1157 note)—

(A) in subsection (b)(3), by striking ‘‘1997, 1998, 1999,

and 2000’’ and inserting ‘‘1997, 1998, 1999, 2000, and

2001’’; and

(B) in subsection (e), by striking ‘‘October 1, 2000’’

each place it appears and inserting ‘‘October 1, 2001’’;

and

(2) in section 599E (8 U.S.C. 1255 note) in subsection

(b)(2), by striking ‘‘September 30, 2000’’ and inserting ‘‘September 30, 2001’’.

SEC. 213. None of the funds provided in this Act or in any

other Act making appropriations for fiscal year 2001 may be used

to administer or implement in Arizona or in the Kansas City,

Missouri or in the Kansas City, Kansas area the Medicare Competitive Pricing Demonstration Project (operated by the Secretary of

Health and Human Services).

SEC. 214. (a) Except as provided by subsection (e) none of

the funds appropriated by this Act may be used to withhold substance abuse funding from a State pursuant to section 1926 of

the Public Health Service Act (42 U.S.C. 300x–26) if such State

certifies to the Secretary of Health and Human Services by March

1, 2001 that the State will commit additional State funds, in accordance with subsection (b), to ensure compliance with State laws

prohibiting the sale of tobacco products to individuals under 18

years of age.

(b) The amount of funds to be committed by a State under

subsection (a) shall be equal to 1 percent of such State’s substance

abuse block grant allocation for each percentage point by which

the State misses the retailer compliance rate goal established by

the Secretary of Health and Human Services under section 1926

of such Act.

(c) The State is to maintain State expenditures in fiscal year

2001 for tobacco prevention programs and for compliance activities

at a level that is not less than the level of such expenditures

maintained by the State for fiscal year 2000, and adding to that

level the additional funds for tobacco compliance activities required

under subsection (a). The State is to submit a report to the Secretary

on all fiscal year 2000 State expenditures and all fiscal year 2001

obligations for tobacco prevention and compliance activities by program activity by July 31, 2001.

(d) The Secretary shall exercise discretion in enforcing the

timing of the State obligation of the additional funds required

by the certification described in subsection (a) as late as July

31, 2001.

(e) None of the funds appropriated by this Act may be used

to withhold substance abuse funding pursuant to section 1926 from

a territory that receives less than $1,000,000.

114 STAT. 2763A–28 PUBLIC LAW 106–554—APPENDIX A

SEC. 215. Section 448 of the Public Health Service Act (42

U.S.C. 285g) is amended by inserting ‘‘gynecologic health,’’ after

‘‘with respect to’’.

SEC. 216. None of the funds appropriated under this Act shall

be expended by the National Institutes of Health on a contract

for the care of the 288 chimpanzees acquired by the National

Institutes of Health from the Coulston Foundation, unless the contractor is accredited by the Association for the Assessment and

Accreditation of Laboratory Animal Care International or has a

Public Health Services assurance, and has not been charged multiple times with egregious violations of the Animal Welfare Act:

Provided, That the requirements of section 481(A)(e)(1) shall not

apply to funds awarded to nonhuman primate research facilities

of special interest to NIH.

SEC. 217. No grants may be awarded under the first paragraph

under the heading ‘‘Department of Health and Human Services,

Health Resources and Services Administration, Health Resources

and Services’’ in chapter 4 of title II of the Emergency Supplemental

Act, 2000 (Public Law 106–246, division B) until March 1, 2001.

SEC. 218. (a) The second sentence of section 5948(d) of title

5, United States Code, is amended to read as follows: ‘‘No agreement

shall be entered into under this section later than September 30,

2005, nor shall any agreement cover a period of service extending

beyond September 30, 2007.’’.

(b) Section 3 of the Federal Physicians Comparability Allowance

Act of 1978 (5 U.S.C. 5948 note) is amended by striking ‘‘September

30, 2002’’ and inserting ‘‘September 30, 2007’’.

SEC. 219. (a) Congress makes the following findings:

(1) Organ procurement organizations play an important

role in the effort to increase organ donation in the United

States.

(2) The current process for the certification and recertification of organ procurement organizations conducted by the

Department of Health and Human Services has created a level

of uncertainty that is interfering with the effectiveness of organ

procurement organizations in raising the level of organ donation.

(3) The General Accounting Office, the Institute of Medicine, and the Harvard School of Public Health have identified

substantial limitations in the organ procurement organization

certification and recertification process and have recommended

changes in that process.

(4) The limitations in the recertification process include:

(A) An exclusive reliance on population-based measures

of performance that do not account for the potential in

the population for organ donation and do not permit consideration of other outcome and process standards that would

more accurately reflect the relative capability and performance of each organ procurement organization.

(B) A lack of due process to appeal to the Secretary

of Health and Human Services for recertification on either

substantive or procedural grounds.

(5) The Secretary of Health and Human Services has the

authority under section 1138(b)(1)(A)(i) of the Social Security

Act (42 U.S.C. 1320b–8(b)(1)(A)(i)) to extend the period for

recertification of an organ procurement organization from 2

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–29

to 4 years on the basis of its past practices in order to avoid

the inappropriate disruption of the nation’s organ system.

(6) The Secretary of Health and Human Services can use

the extended period described in paragraph (5) for recertification of all organ procurement organizations to—

(A) develop improved performance measures that

would reflect organ donor potential and interim outcomes,

and to test these measures to ensure that they accurately

measure performance differences among the organ procurement organizations; and

(B) improve the overall certification process by incorporating process as well as outcome performance measures,

and developing equitable processes for appeals.

(b) Section 371(b)(1) of the Public Health Service Act (42 U.S.C.

273(b)(1)) is amended—

(1) by redesignating subparagraphs (D) through (G) as

subparagraphs (E) through (H), respectively;

(2) by realigning the margin of subparagraph (F) (as so

redesignated) so as to align with subparagraph (E) (as so

redesignated); and

(3) by inserting after subparagraph (C) the following:

‘‘(D) notwithstanding any other provision of law, has met

the other requirements of this section and has been certified

or recertified by the Secretary within the previous 4-year period

as meeting the performance standards to be a qualified organ

procurement organization through a process that either—

‘‘(i) granted certification or recertification within such

4-year period with such certification or recertification in

effect as of January 1, 2000, and remaining in effect

through the earlier of—

‘‘(I) January 1, 2002; or

‘‘(II) the completion of recertification under the

requirements of clause (ii); or

‘‘(ii) is defined through regulations that are promulgated by the Secretary by not later than January 1, 2002,

that—

‘‘(I) require recertifications of qualified organ

procurement organizations not more frequently than

once every 4 years;

‘‘(II) rely on outcome and process performance

measures that are based on empirical evidence,

obtained through reasonable efforts, of organ donor

potential and other related factors in each service area

of qualified organ procurement organizations;

‘‘(III) use multiple outcome measures as part of

the certification process; and

‘‘(IV) provide for a qualified organ procurement

organization to appeal a decertification to the Secretary

on substantive and procedural grounds;’’.

SEC. 220. (a) In order for the Centers for Disease Control

and Prevention to carry out international HIV/AIDS and other

infectious disease, chronic and environmental disease, and other

health activities abroad during fiscal year 2001, the Secretary of

Health and Human Services is authorized to—

(1) utilize the authorities contained in subsection 2(c) of

the State Department Basic Authorities Act of 1956, as amended, subject to the limitations set forth in subsection (b), and

114 STAT. 2763A–30 PUBLIC LAW 106–554—APPENDIX A

(2) enter into reimbursable agreements with the Department of State using any funds appropriated to the Department

of Health and Human Services, for the purposes for which

the funds were appropriated in accordance with authority

granted to the Secretary of Health and Human Services or

under authority governing the activities of the Department

of State.

(b) In exercising the authority set forth in subsection (a)(1),

the Secretary of Health and Human Services— (1) shall not award contracts for performance of an inherently governmental function; and

(2) shall follow otherwise applicable Federal procurement

laws and regulations to the maximum extent practicable.

SEC. 221. Notwithstanding any other provision of law, the

Director, National Institutes of Health, may enter into and administer a long-term lease for facilities for the purpose of providing

laboratory, office and other space for biomedical and behavioral

research at the Bayview Campus in Baltimore, Maryland: Provided, That the House and Senate Appropriations Committees will be

notified of the terms and conditions of the lease upon its execution.

SEC. 222. Of the funds appropriated in this Act for the National Institutes of Health, $5,800,000 shall be transferred to the Office

of the Secretary, General Departmental Management to support

the newly established Office for Human Research Protections.

SEC. 223. Section 487E(a)(1) of the Public Health Service Act

is amended by striking ‘‘as employees of the National Institutes

of Health’’. SEC. 224. Notwithstanding any other provision of law relating

to vacancies in offices for which appointments must be made by

the President, including any time limitation on serving in an acting

capacity, the Acting Director of the National Institutes of Health

as of January 12, 2000, may serve in that position until a new

Director of the National Institutes of Health is confirmed by the

Senate.

SEC. 225. The National Neuroscience Research Center to be

constructed on the National Institutes of Health Bethesda campus

is hereby named the John Edward Porter Neuroscience Research

Center.

This title may be cited as the ‘‘Department of Health and

Human Services Appropriations Act, 2001’’.

TITLE III—DEPARTMENT OF EDUCATION

EDUCATION REFORM

For carrying out activities authorized by title IV of the Goals

2000: Educate America Act as in effect prior to September 30,

2000, and sections 3122, 3132, 3136, and 3141, parts B, C, and

D of title III, and section 10105 and part I of title X of the

Elementary and Secondary Education Act of 1965, $1,880,710,000,

of which $38,000,000 shall be for the Goals 2000: Educate America

Act, and of which $191,950,000 shall be for section 3122: Provided,

That up to one-half of 1 percent of the amount available under

section 3132 shall be set aside for the outlying areas, to be distributed on the basis of their relative need as determined by the

Secretary in accordance with the purposes of the program: Provided

further, That if any State educational agency does not apply for

a grant under section 3132, that State’s allotment under section

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–31

3131 shall be reserved by the Secretary for grants to local educational agencies in that State that apply directly to the Secretary

according to the terms and conditions published by the Secretary

in the Federal Register: Provided further, That with respect to

all funds appropriated to carry out section 10901 et seq. in this

Act, the Secretary shall strongly encourage applications for grants

that are to be submitted jointly by a local educational agency

(or a consortium of local educational agencies) and a communitybased organization that has experience in providing before- and

after-school services and all applications submitted to the Secretary

shall contain evidence that the project contains elements that are

designed to assist students in meeting or exceeding State and

local standards in core academic subjects, as appropriate to the

needs of participating children: Provided further, That $125,000,000,

which shall become available on July 1, 2001, and remain available

through September 30, 2002, shall be available to support activities

under section 10105 of part A of title X of the Elementary and

Secondary Education Act of 1965, of which up to 6 percent shall

become available October 1, 2000, and be available for evaluation,

technical assistance, school networking, peer review of applications,

and program outreach activities: Provided further, That funds made

available to local educational agencies under this section shall

be used only for activities related to establishing smaller learning

communities in high schools: Provided further, That $46,328,000

of the funds available to carry out section 3136 of the Elementary

and Secondary Education Act of 1965, $8,768,000 of the funds

available to carry out part B of title III of that Act and $20,614,000

of the funds available to carry out part I of title X of that Act

shall be available for the projects and in the amounts specified

in the statement of the managers on the conference report accompanying this Act.

EDUCATION FOR THE DISADVANTAGED

For carrying out title I of the Elementary and Secondary Education Act of 1965, and section 418A of the Higher Education

Act of 1965, $9,532,621,000, of which $2,731,921,000 shall become

available on July 1, 2001, and shall remain available through

September 30, 2002, and of which $6,758,300,000 shall become

available on October 1, 2001 and shall remain available through

September 30, 2002, for academic year 2001–2002: Provided, That

$7,332,721,000 shall be available for basic grants under section

1124: Provided further, That $225,000,000 of these funds shall

be allocated among the States in the same proportion as funds

are allocated among the States under section 1122, to carry out

section 1116(c): Provided further, That 100 percent of these funds

shall be allocated by States to local educational agencies for the

purposes of carrying out section 1116(c): Provided further, That

all local educational agencies receiving an allocation under the

preceding proviso, and all other local educational agencies that

are within a State that receives funds under part A of title I

of the Elementary and Secondary Education Act of 1965 (other

than a local educational agency within a State receiving a minimum

grant under section 1124(d) or 1124A(a)(1)(B) of such Act), shall

provide all students enrolled in a school identified under section

1116(c) with the option to transfer to another public school within

the local educational agency, including a public charter school,

that has not been identified for school improvement under section

114 STAT. 2763A–32 PUBLIC LAW 106–554—APPENDIX A

1116(c), unless such option to transfer is prohibited by State law,

or local law, which includes school board-approved local educational

agency policy: Provided further, That if the local educational agency

demonstrates to the satisfaction of the State educational agency

that the local educational agency lacks the capacity to provide

all students with the option to transfer to another public school,

and after giving notice to the parents of children affected that

it is not possible, consistent with State and local law, to accommodate the transfer request of every student, the local educational

agency shall permit as many students as possible (who shall be

selected by the local educational agency on an equitable basis)

to transfer to a public school that has not been identified for

school improvement under section 1116(c): Provided further, That

up to $3,500,000 of these funds shall be available to the Secretary

on October 1, 2000, to obtain updated local educational agency

level census poverty data from the Bureau of the Census: Provided

further, That $1,364,000,000 shall be available for concentration

grants under section 1124A: Provided further, That grant awards

under sections 1124 and 1124A of title I of the Elementary and

Secondary Education Act of 1965 shall be not less than the greater

of 100 percent of the amount each State and local educational

agency received under this authority for fiscal year 2000 or the

amount such State and local educational agency would receive

if $6,883,503,000 for Basic Grants and $1,222,397,000 for Concentration Grants were allocated in accordance with section

1122(c)(3) of title I: Provided further, That notwithstanding any

other provision of law, grant awards under section 1124A of title

I of the Elementary and Secondary Education Act of 1965 shall

be made to those local educational agencies that received a Concentration Grant under the Department of Education Appropriations Act, 2000, but are not eligible to receive such a grant for

fiscal year 2001: Provided further, That the Secretary shall not

take into account the hold harmless provisions in this section in

determining State allocations under any other program administered by the Secretary in any fiscal year: Provided further, That

$8,900,000 shall be available for evaluations under section 1501

and not more than $8,500,000 shall be reserved for section 1308,

of which not more than $3,000,000 shall be reserved for section

1308(d): Provided further, That $210,000,000 shall be available

under section 1002(g)(2) to demonstrate effective approaches to

comprehensive school reform to be allocated and expended in accordance with the instructions relating to this activity in the statement

of the managers on the conference report accompanying Public

Law 105–78 and in the statement of the managers on the conference

report accompanying Public Law 105–277: Provided further, That

in carrying out this initiative, the Secretary and the States shall

support only approaches that show the most promise of enabling

children served by title I to meet challenging State content standards and challenging State student performance standards based

on reliable research and effective practices, and include an emphasis

on basic academics and parental involvement.

IMPACT AID

For carrying out programs of financial assistance to federally

affected schools authorized by title VIII of the Elementary and

Secondary Education Act of 1965, $993,302,000, of which

$882,000,000 shall be for basic support payments under section

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–33

8003(b), $50,000,000 shall be for payments for children with disabilities under section 8003(d), $12,802,000 shall be for construction

under section 8007, $40,500,000 shall be for Federal property payments under section 8002, and $8,000,000, to remain available

until expended, shall be for facilities maintenance under section

8008: Provided, That $6,802,000 of the funds for section 8007 shall

be available for the local educational agencies and in the amounts

specified in the statement of the managers on the conference report

accompanying this Act: Provided further, That from the amount

appropriated for section 8002, the Secretary shall treat as timely

filed, and shall process for payment, an application for a fiscal

year 1999 payment from Academy School District 20, Colorado,

under that section if the Secretary has received that application

not later than 30 days after the enactment of this Act: Provided

further, That the Secretary of Education shall consider the local

educational agency serving the Kadoka School District, 35–1, in

South Dakota, eligible for payments under section 8002 for fiscal

year 2001 and each succeeding fiscal year, with respect to land

in Washabaugh and Jackson Counties, South Dakota, that is owned

by the Department of Defense and used as a bombing range: Provided further, That from the amount appropriated for section 8002,

the Secretary shall first increase the payment of any local educational agency that was denied funding or had its payment reduced

under that section for fiscal year 1998 due to section 8002(b)(1)(C)

to the amount that would have been made without the limitation

of that section: Provided further, That from the amount appro- priated for section 8002, $500,000 shall be for subsection 8002( j).

SCHOOL IMPROVEMENT PROGRAMS

For carrying out school improvement activities authorized by

titles II, IV, V–A and B, VI, IX, X, and XIII of the Elementary

and Secondary Education Act of 1965 (‘‘ESEA’’); the McKinneyVento Homeless Assistance Act; and the Civil Rights Act of 1964

and part B of title VIII of the Higher Education Amendments

of 1998; $4,872,084,000, of which $2,403,750,000 shall become available on July 1, 2001, and remain available through September

30, 2002, and of which $1,765,000,000 shall become available on

October 1, 2001 and shall remain available through September

30, 2002 for academic year 2001–2002: Provided, That $485,000,000

shall be available for Eisenhower professional development State

grants under part B of title II of the Elementary and Secondary

Education Act of 1965: Provided further, That each local educational

agency shall use funds in excess of the allocation it received under

such part for the preceding fiscal year to improve teacher quality

by reducing the percentage of teachers who do not have State

certification or are certified through emergency or provisional

means; are teaching out of field in some or all of the subject

areas and grade levels in which they teach; or who lack sufficient

content knowledge to teach effectively in the areas they teach

to obtain that knowledge: Provided further, That the local educational agency may also use such excess funds for: activities

authorized under section 2210 of the Elementary and Secondary

Education Act of 1965; mentoring programs for new teachers;

providing opportunities for teachers to attend multi-week institutes,

such as those provided in the summer months, that provide intensive professional development in partnership with local educational

agencies; and carrying out initiatives to promote the retention of

114 STAT. 2763A–34 PUBLIC LAW 106–554—APPENDIX A

highly qualified teachers who have a record of success in helping

low-achieving students improve their academic success: Provided

further, That each State educational agency may use such excess

funds to carry out activities under section 2207 of the Elementary

and Secondary Education Act of 1965: Provided further, That each

State agency for higher education may use such excess funds to

carry out activities under section 2211 of the Elementary and

Secondary Education Act of 1965: Provided further, That both State

educational agencies and State agencies for higher education may

also use such excess funds for multi-week institutes, such as those

provided in the summer months, that provide intensive professional

development in partnership with local educational agencies; and

grants to partnerships of such entities as local educational agencies,

institutions of higher education, and private business, to recruit,

and prepare, and provide professional development to, and help

retain, school principals and superintendents, especially for such

individuals who serve, or are preparing to serve, in high-poverty,

low-performing schools and local educational agencies: Provided

further, That such activities may be undertaken in consortium

with other States: Provided further, That of the funds appropriated

for part B of title II of the Elementary and Secondary Education

Act of 1965, $45,000,000 shall be available to States and allocated

in accordance with section 2202(b) of that Act (except that the

requirements of section 2203 shall not apply): Provided further,

That notwithstanding any other provision of law, each State shall

use the amount made available under the preceding proviso to

support efforts to meet the requirements for State eligibility for

the Ed-Flex Partnership Act of 1999 or the requirements under

section 1111 of title I of the Elementary and Secondary Education

Act of 1965: Provided further, That $44,000,000 shall be available

for national activities under section 2102 of the Elementary and

Secondary Education Act of 1965: Provided further, That of the

amount available in the preceding proviso, $3,000,000 shall be

made available to the Secretary for the Troops-to-Teachers Program

for transfer to the Defense Activity for Non-Traditional Education

Support of the Department of Defense: Provided further, That the

funds transferred under the preceding proviso shall be used by

the Secretary of Defense to administer the Troops-to-Teachers Program, including the selection of participants in the Program under

the Troops-to-Teachers Program Act of 1999 (title XVII of Public

Law 106–65; 20 U.S.C. 9301 et seq.): Provided further, That for

purposes of sections 1702(b) and (c) of the Troops-to-Teachers Program Act of 1999, the Secretary of Education shall be the administering Secretary and may, at the Secretary’s discretion, carry

out the activities under section 1702(c) of that Act and retain

a portion of the funds made available for the Troops-to-Teachers

Program to carry out section 1702(b) and (c) of that Act: Provided

further, That of the amount made available under this heading

for national activities under section 2102 of the Elementary and

Secondary Education Act of 1965, the Secretary is authorized to

use a portion of such funds to carry out activities to improve

the knowledge and skills of early childhood educators and caregivers

who work in urban or rural communities with high concentrations

of young children living in poverty: Provided further, That of the

amount appropriated, $3,208,000,000 shall be for title VI of the

Elementary and Secondary Education Act of 1965 and to carry

out activities under part B of the Individuals with Disabilities

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–35

Education Act (20 U.S.C. 1411 et seq.): Provided further, That

of the amount made available for title VI, $1,623,000,000 shall

be available, notwithstanding any other provision of law, in accordance with section 306 of this Act in order to reduce class size,

particularly in the early grades, using highly qualified teachers

to improve educational achievement for regular and special needs

children: Provided further, That of the amount made available

for title VI, $1,200,000,000 shall be available, notwithstanding any

other provision of law, for grants for school repair and renovation,

activities under part B of the Individuals with Disabilities Education Act (20 U.S.C. 1411 et seq.), and technology activities, in

accordance with section 321 of this Act: Provided further, That

funds made available under this heading to carry out section 6301(b)

of the Elementary and Secondary Education Act of 1965 shall

be available for education reform projects that provide same gender

schools and classrooms, consistent with applicable law: Provided

further, That of the amount made available to carry out activities

authorized under part C of title IX of the Elementary and Secondary

Education Act of 1965, $1,000,000 shall be for the Alaska Humanities Forum for operation of the Rose student exchange program

and $1,000,000 shall be for the Alaska Native Heritage Center

to support its program of cultural education activities: Provided

further, That of the amount made available for subpart 2 of part

A of title IV of the Elementary and Secondary Education Act of

1965, $10,000,000, to remain available until expended, shall be

for Project School Emergency Response to Violence to provide education-related services to local educational agencies in which the

learning environment has been disrupted due to a violent or traumatic crisis.

READING EXCELLENCE

For necessary expenses to carry out the Reading Excellence

Act, $91,000,000, which shall become available on July 1, 2001

and shall remain available through September 30, 2002 and

$195,000,000 which shall become available on October 1, 2001 and

remain available through September 30, 2002.

INDIAN EDUCATION

For expenses necessary to carry out, to the extent not otherwise

provided, title IX, part A of the Elementary and Secondary Education Act of 1965, as amended, $115,500,000.

BILINGUAL AND IMMIGRANT EDUCATION

For carrying out, to the extent not otherwise provided, bilingual,

foreign language and immigrant education activities authorized

by parts A and C and section 7203 of title VII of the Elementary

and Secondary Education Act of 1965, $460,000,000: Provided, That

State educational agencies may use all, or any part of, their part

C allocation for competitive grants to local educational agencies.

SPECIAL EDUCATION

For carrying out the Individuals with Disabilities Education

Act, $7,439,948,000, of which $2,090,452,000 shall become available

for obligation on July 1, 2001, and shall remain available through

September 30, 2002, and of which $5,072,000,000 shall become

114 STAT. 2763A–36 PUBLIC LAW 106–554—APPENDIX A

available on October 1, 2001 and shall remain available through

September 30, 2002, for academic year 2001–2002: Provided, That

$9,500,000 shall be for Recording for the Blind and Dyslexic to

support the development, production, and circulation of recorded

educational materials: Provided further, That $1,500,000 shall be

for the recipient of funds provided by Public Law 105–78 under

section 687(b)(2)(G) of the Act to provide information on diagnosis,

intervention, and teaching strategies for children with disabilities:

Provided further, That $7,353,000 of the funds for section 672

of the Act shall be available for the projects and in the amounts

specified in the statement of the managers on the conference report

accompanying this Act.

REHABILITATION SERVICES AND DISABILITY RESEARCH

For carrying out, to the extent not otherwise provided, the

Rehabilitation Act of 1973, the Assistive Technology Act of 1998,

and the Helen Keller National Center Act, $2,805,339,000: Provided,

That the funds provided for title I of the Assistive Technology

Act of 1998 (‘‘the AT Act’’) shall be allocated notwithstanding section

105(b)(1) of the AT Act: Provided further, That each State shall

be provided $50,000 for activities under section 102 of the AT

Act: Provided further, That $15,000,000 shall be used to support

grants for up to 3 years to States under title III of the AT Act,

of which the Federal share shall not exceed 75 percent in the

first year, 50 percent in the second year, and 25 percent in the

third year, and that the requirements in section 301(c)(2) and

section 302 of that Act shall not apply to such grants: Provided

further, That $4,600,000 of the funds for section 303 of the

Rehabilitation Act of 1973 shall be available for the projects and

in the amounts specified in the statement of the managers on

the conference report accompanying this Act: Provided further, That

$400,000 of the funds for title II of the Rehabilitation Act of 1973

shall be for the Cerebral Palsy Research Foundation in Wichita,

Kansas for the establishment of a Rehabilitation Research and

Training Center to study and recommend incentives for employers

to hire persons with significant disabilities.

SPECIAL INSTITUTIONS FOR PERSONS WITH DISABILITIES

AMERICAN PRINTING HOUSE FOR THE BLIND

For carrying out the Act of March 3, 1879, as amended (20

U.S.C. 101 et seq.), $12,000,000.

NATIONAL TECHNICAL INSTITUTE FOR THE DEAF

For the National Technical Institute for the Deaf under titles

I and II of the Education of the Deaf Act of 1986 (20 U.S.C.

4301 et seq.), $53,376,000, of which $5,376,000 shall be for construction and shall remain available until expended: Provided, That

from the total amount available, the Institute may at its discretion

use funds for the endowment program as authorized under section

207.

GALLAUDET UNIVERSITY

For the Kendall Demonstration Elementary School, the Model

Secondary School for the Deaf, and the partial support of Gallaudet

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–37

University under titles I and II of the Education of the Deaf

Act of 1986 (20 U.S.C. 4301 et seq.), $89,400,000: Provided, That

from the total amount available, the University may at its discretion

use funds for the endowment program as authorized under section

207.

VOCATIONAL AND ADULT EDUCATION

For carrying out, to the extent not otherwise provided, the

Carl D. Perkins Vocational and Technical Education Act, the Adult

Education and Family Literacy Act, and title VIII–D of the Higher

Education Act of 1965, as amended, and Public Law 102–73,

$1,825,600,000, of which $1,000,000 shall remain available until

expended, and of which $1,028,000,000 shall become available on

July 1, 2001 and shall remain available through September 30,

2002 and of which $791,000,000 shall become available on October

1, 2001 and shall remain available through September 30, 2002:

Provided, That of the amounts made available for the Carl D.

Perkins Vocational and Technical Education Act, $5,600,000 shall

be for tribally controlled postsecondary vocational and technical

institutions under section 117: Provided further, That $9,000,000

shall be for carrying out section 118 of such Act: Provided further,

That of the amounts made available for the Carl D. Perkins Vocational and Technical Education Act, $5,000,000 shall be for demonstration activities authorized by section 207: Provided further,

That of the amount provided for Adult Education State Grants,

$70,000,000 shall be made available for integrated English literacy

and civics education services to immigrants and other limited

English proficient populations: Provided further, That of the amount

reserved for integrated English literacy and civics education, notwithstanding section 211 of the Adult Education and Family Literacy Act, 65 percent shall be allocated to States based on a State’s

absolute need as determined by calculating each State’s share of

a 10-year average of the Immigration and Naturalization Service

data for immigrants admitted for legal permanent residence for

the 10 most recent years, and 35 percent allocated to States that

experienced growth as measured by the average of the 3 most

recent years for which Immigration and Naturalization Service

data for immigrants admitted for legal permanent residence are

available, except that no State shall be allocated an amount less

than $60,000: Provided further, That of the amounts made available

for the Adult Education and Family Literacy Act, $14,000,000 shall

be for national leadership activities under section 243 and

$6,500,000 shall be for the National Institute for Literacy under

section 242: Provided further, That $22,000,000 shall be for Youth

Offender Grants, of which $5,000,000 shall be used in accordance

with section 601 of Public Law 102–73 as that section was in

effect prior to the enactment of Public Law 105–220.

STUDENT FINANCIAL ASSISTANCE

For carrying out subparts 1, 3, and 4 of part A, section 428K,

part C and part E of title IV of the Higher Education Act of

1965, as amended, $10,674,000,000, which shall remain available

through September 30, 2002.

The maximum Pell Grant for which a student shall be eligible

during award year 2001–2002 shall be $3,750: Provided, That notwithstanding section 401(g) of the Act, if the Secretary determines,

114 STAT. 2763A–38 PUBLIC LAW 106–554—APPENDIX A

prior to publication of the payment schedule for such award year,

that the amount included within this appropriation for Pell Grant

awards in such award year, and any funds available from the

fiscal year 2000 appropriation for Pell Grant awards, are insufficient

to satisfy fully all such awards for which students are eligible,

as calculated under section 401(b) of the Act, the amount paid

for each such award shall be reduced by either a fixed or variable

percentage, or by a fixed dollar amount, as determined in accordance

with a schedule of reductions established by the Secretary for

this purpose.

FEDERAL FAMILY EDUCATION LOAN PROGRAM ACCOUNT

For Federal administrative expenses to carry out guaranteed

student loans authorized by title IV, part B, of the Higher Education

Act of 1965, as amended, $48,000,000.

HIGHER EDUCATION

For carrying out, to the extent not otherwise provided, section

121 and titles II, III, IV, V, VI, and VII of the Higher Education

Act of 1965, as amended, section 1543 of the Higher Education

Amendments of 1992 and title VIII of the Higher Education Amendments of 1998, and the Mutual Educational and Cultural Exchange

Act of 1961, $1,911,710,000, of which $10,000,000 for interest subsidies authorized by section 121 of the Higher Education Act of

1965, shall remain available until expended: Provided, That

$10,000,000, to remain available through September 30, 2002, shall

be available to fund fellowships for academic year 2002–2003 under

part A, subpart 1 of title VII of said Act, under the terms and

conditions of part A, subpart 1: Provided further, That $3,000,000

is for data collection and evaluation activities for programs under

the Higher Education Act of 1965, including such activities needed

to comply with the Government Performance and Results Act of

1993: Provided further, That $15,000,000 shall be available for

tribally controlled colleges and universities under section 316 of

the Higher Education Act of 1965, of which $5,000,000 shall be

used for construction and renovation: Provided further, That

$250,000 shall be for the Web-Based Education Commission to

continue activities authorized under part J of title VIII of the

Higher Education Amendments of 1998: Provided further, That

$115,487,000 of the funds for part B of title VII of the Higher

Education Act of 1965 shall be available for the projects and in

the amounts specified in the statement of the managers on the

conference report accompanying this Act.

HOWARD UNIVERSITY

For partial support of Howard University (20 U.S.C. 121 et

seq.), $232,474,000, of which not less than $3,600,000 shall be

for a matching endowment grant pursuant to the Howard University

Endowment Act (Public Law 98–480) and shall remain available

until expended.

COLLEGE HOUSING AND ACADEMIC FACILITIES LOANS PROGRAM

For Federal administrative expenses authorized under section 121 of the Higher Education Act of 1965, $762,000 to carry out

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–39

activities related to existing facility loans entered into under the

Higher Education Act of 1965.

HISTORICALLY BLACK COLLEGE AND UNIVERSITY CAPITAL FINANCING

PROGRAM ACCOUNT

The total amount of bonds insured pursuant to section 344

of title III, part D of the Higher Education Act of 1965 shall

not exceed $357,000,000, and the cost, as defined in section 502

of the Congressional Budget Act of 1974, of such bonds shall not

exceed zero.

For administrative expenses to carry out the Historically Black

College and University Capital Financing Program entered into

pursuant to title III, part D of the Higher Education Act of 1965,

as amended, $208,000.

EDUCATION RESEARCH, STATISTICS, AND IMPROVEMENT

For carrying out activities authorized by the Educational

Research, Development, Dissemination, and Improvement Act of

1994, including part E; the National Education Statistics Act of

1994, including sections 411 and 412; section 2102 of title II, parts

A, B, K, and L and sections 10102 and 10601 of title X, and

part C of title XIII of the Elementary and Secondary Education

Act of 1965, as amended, and title VI of Public Law 103–227,

$732,721,000: Provided, That of the funds appropriated for part

A of title X of the Elementary and Secondary Education Act of

1965, as amended, $5,000,000 shall be made available for a high

school reform program of grants to State educational agencies to

improve academic performance and provide technical skills training:

Provided further, That of the funds appropriated for part A of

title X of the Elementary and Secondary Education Act of 1965,

as amended, $5,000,000 shall be made available to carry out part

L of title X of the Act: Provided further, That of the amount

available for part A of title X of the Elementary and Secondary

Education Act of 1965, as amended, $5,000,000 shall be available

for grants to State and local educational agencies, in collaboration

with other agencies and organizations, for school dropout prevention

programs designed to address the needs of populations or communities with the highest dropout rates: Provided further, That of

the amount made available for part A of title X of the Elementary

and Secondary Education Act of 1965, as amended, $50,000,000

shall be made available to enable the Secretary of Education to

award grants to develop, implement, and strengthen programs to

teach American history (not social studies) as a separate subject

within school curricula: Provided further, That $53,000,000 of the

amount available for the national education research institutes

shall be allocated notwithstanding section 912(m)(1)(B–F) and subparagraphs (B) and (C) of section 931(c)(2) of Public Law 103–

227 and $20,000,000 of that $53,000,000 shall be made available

for the Interagency Education Research Initiative: Provided further,

That of the funds appropriated for part A of title X of the

Elementary and Secondary Education Act, as amended, $50,000,000

shall be available to demonstrate effective approaches to comprehensive school reform, to be allocated and expended in accordance

with the instructions relating to this activity in the statement

of managers on the conference report accompanying Public Law

105–78 and in the statement of the managers on the conference

114 STAT. 2763A–40 PUBLIC LAW 106–554—APPENDIX A

report accompanying Public Law 105–277: Provided further, That

the funds made available for comprehensive school reform shall

become available on July 1, 2001, and remain available through

September 30, 2002, and in carrying out this initiative, the Secretary and the States shall support only approaches that show

the most promise of enabling children to meet challenging State

content standards and challenging State student performance

standards based on reliable research and effective practices, and

include an emphasis on basic academics and parental involvement:

Provided further, That $139,624,000 of the funds for section 10101

of the Elementary and Secondary Education Act of 1965 shall

be available for the projects and in the amounts specified in the

statement of the managers on the conference report accompanying

this Act: Provided further, That of the funds appropriated under

section 10601 of title X of the Elementary and Secondary Education

Act of 1965, as amended, $2,000,000 shall be used to conduct

a violence prevention demonstration program: Provided further, That of the funds available for section 10601 of title X of the

Elementary and Secondary Education Act of 1965, as amended,

$150,000 shall be awarded to the Center for Educational Technologies to complete production and distribution of an effective

CD–ROM product that would complement the ‘‘We the People:

The Citizen and the Constitution’’ curriculum: Provided further,

That, of the funds for title VI of Public Law 103–227 and notwithstanding the provisions of section 601(c)(1)(C) of that Act, $1,200,000

shall be available to the Center for Civic Education to conduct

a civic education program with Northern Ireland and the Republic

of Ireland and, consistent with the civics and Government activities

authorized in section 601(c)(3) of Public Law 103–227, to provide

civic education assistance to democracies in developing countries.

The term ‘‘developing countries’’ shall have the same meaning as

the term ‘‘developing country’’ in the Education for the Deaf Act.

DEPARTMENTAL MANAGEMENT

PROGRAM ADMINISTRATION

For carrying out, to the extent not otherwise provided, the

Department of Education Organization Act, including rental of conference rooms in the District of Columbia and hire of two passenger

motor vehicles, $413,184,000.

OFFICE FOR CIVIL RIGHTS

For expenses necessary for the Office for Civil Rights, as authorized by section 203 of the Department of Education Organization

Act, $76,000,000.

OFFICE OF THE INSPECTOR GENERAL

For expenses necessary for the Office of the Inspector General,

as authorized by section 212 of the Department of Education

Organization Act, $36,500,000.

GENERAL PROVISIONS

SEC. 301. No funds appropriated in this Act may be used

for the transportation of students or teachers (or for the purchase

of equipment for such transportation) in order to overcome racial

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–41

imbalance in any school or school system, or for the transportation

of students or teachers (or for the purchase of equipment for such

transportation) in order to carry out a plan of racial desegregation

of any school or school system.

SEC. 302. None of the funds contained in this Act shall be

used to require, directly or indirectly, the transportation of any

student to a school other than the school which is nearest the

student’s home, except for a student requiring special education,

to the school offering such special education, in order to comply

with title VI of the Civil Rights Act of 1964. For the purpose

of this section an indirect requirement of transportation of students

includes the transportation of students to carry out a plan involving

the reorganization of the grade structure of schools, the pairing

of schools, or the clustering of schools, or any combination of grade

restructuring, pairing or clustering. The prohibition described in

this section does not include the establishment of magnet schools.

SEC. 303. No funds appropriated under this Act may be used

to prevent the implementation of programs of voluntary prayer

and meditation in the public schools.

(TRANSFER OF FUNDS)

SEC. 304. Not to exceed 1 percent of any discretionary funds

(pursuant to the Balanced Budget and Emergency Deficit Control

Act of 1985, as amended) which are appropriated for the Department of Education in this Act may be transferred between appropriations, but no such appropriation shall be increased by more

than 3 percent by any such transfer: Provided, That the Appropriations Committees of both Houses of Congress are notified at least

15 days in advance of any transfer.

SEC. 305. The Comptroller General of the United States shall

evaluate the extent to which funds made available under part

A of title I of the Elementary and Secondary Education Act of

1965 are allocated to schools and local educational agencies with

the greatest concentrations of school-age children from low-income

families, the extent to which allocations of such funds adjust to

shifts in concentrations of pupils from low-income families in different regions, States, and substate areas, the extent to which

the allocation of such funds encourages the targeting of State funds

to areas with higher concentrations of children from low-income

families, and the implications of current distribution methods for

such funds, shall make formula and other policy recommendations

to improve the targeting of such funds to more effectively serve

low-income children in both rural and urban areas, and shall prepare interim and final reports based on the results of the study,

to be submitted to Congress not later than February 1, 2001,

and April 1, 2001.

SEC. 306. (a) From the amount appropriated for title VI of

the Elementary and Secondary Education Act of 1965 in accordance

with this section, the Secretary of Education—

(1) shall make available a total of $6,000,000 to the Secretary of the Interior (on behalf of the Bureau of Indian Affairs)

and the outlying areas for activities under this section; and

(2) shall allocate the remainder by providing each State

the same percentage of that remainder as it received of the

funds allocated to States under section 307(a)(2) of the Department of Education Appropriations Act, 1999.

114 STAT. 2763A–42 PUBLIC LAW 106–554—APPENDIX A

(b)(1) Each State that receives funds under this section shall

distribute 100 percent of such funds to local educational agencies,

of which—

(A) 80 percent of such amount shall be allocated to such

local educational agencies in proportion to the number of children, aged 5 to 17, who reside in the school district served

by such local educational agency from families with incomes

below the poverty line (as defined by the Office of Management

and Budget and revised annually in accordance with section

673(2) of the Community Services Block Grant Act (42 U.S.C.

9902(2))) applicable to a family of the size involved for the

most recent fiscal year for which satisfactory data are available

compared to the number of such individuals who reside in

the school districts served by all the local educational agencies

in the State for that fiscal year; and

(B) 20 percent of such amount shall be allocated to such

local educational agencies in accordance with the relative enrollments of children, aged 5 to 17, in public and private nonprofit

elementary and secondary schools within the boundaries of

such agencies.

(2) Notwithstanding paragraph (1), if the award to a local

educational agency under this section is less than the starting

salary for a new fully qualified teacher in that agency, who is

certified within the State (which may include certification through

State or local alternative routes), has a baccalaureate degree, and

demonstrates the general knowledge, teaching skills, and subject

matter knowledge required to teach in his or her content areas,

that agency may use funds under this section to (A) help pay

the salary of a full- or part-time teacher hired to reduce class

size, which may be in combination with other Federal, State, or

local funds; or (B) pay for activities described in subsection

(c)(2)(A)(iii) which may be related to teaching in smaller classes.

(c)(1) The basic purpose and intent of this section is to reduce

class size with fully qualified teachers. Each local educational

agency that receives funds under this section shall use such funds

to carry out effective approaches to reducing class size with fully

qualified teachers who are certified within the State, including

teachers certified through State or local alternative routes, and

who demonstrate competency in the areas in which they teach,

to improve educational achievement for both regular and special

needs children, with particular consideration given to reducing class

size in the early elementary grades for which some research has

shown class size reduction is most effective.

(2)(A) Each such local educational agency may use funds under

this section for—

(i) recruiting (including through the use of signing bonuses,

and other financial incentives), hiring, and training fully qualified regular and special education teachers (which may include

hiring special education teachers to team-teach with regular

teachers in classrooms that contain both children with disabilities and non-disabled children) and teachers of special-needs

children who are certified within the State, including teachers

certified through State or local alternative routes, have a baccalaureate degree and demonstrate the general knowledge, teaching skills, and subject matter knowledge required to teach

in their content areas;

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–43

(ii) testing new teachers for academic content knowledge

and to meet State certification requirements that are consistent

with title II of the Higher Education Act of 1965; and

(iii) providing professional development (which may include

such activities as those described in section 2210 of the

Elementary and Secondary Education Act of 1965, opportunities

for teachers to attend multi-week institutes, such as those

made available during the summer months that provide intensive professional development in partnership with local educational agencies and initiatives that promote retention and

mentoring), to teachers, including special education teachers

and teachers of special-needs children, in order to meet the

goal of ensuring that all instructional staff have the subject

matter knowledge, teaching knowledge, and teaching skills necessary to teach effectively in the content area or areas in

which they provide instruction, consistent with title II of the

Higher Education Act of 1965.

(B)(i) Except as provided under clause (ii), a local educational

agency may use not more than a total of 25 percent of the award

received under this section for activities described in clauses (ii)

and (iii) of subparagraph (A).

(ii) A local educational agency in which 10 percent or

more of teachers in elementary schools, as defined by section

14101(14) of the Elementary and Secondary Education Act of

1965, have not met applicable State and local certification

requirements (including certification through State or local

alternative routes), or if such requirements have been waived,

may use more than 25 percent of the funds it receives under

this section for activities described in subparagraph (A)(iii)

to help teachers who are not certified by the State become

certified, including through State or local alternative routes,

or to help teachers affected by class size reduction who lack

sufficient content knowledge to teach effectively in the areas

they teach to obtain that knowledge, if the local educational

agency notifies the State educational agency of the percentage

of the funds that it will use for the purpose described in

this clause.

(C) A local educational agency that has already reduced class

size in the early grades to 18 or less children (or has already

reduced class size to a State or local class size reduction goal

that was in effect on the day before the enactment of the Department of Education Appropriations Act, 2000, if that State or local

educational agency goal is 20 or fewer children) may use funds

received under this section—

(i) to make further class size reductions in grades kindergarten through 3;

(ii) to reduce class size in other grades; or

(iii) to carry out activities to improve teacher quality including professional development.

(D) If a local educational agency has already reduced class

size in the early grades to 18 or fewer children and intends to

use funds provided under this section to carry out professional

development activities, including activities to improve teacher quality, then the State shall make the award under subsection (b)

to the local educational agency.

(3) Each such agency shall use funds under this section only

to supplement, and not to supplant, State and local funds that,

114 STAT. 2763A–44 PUBLIC LAW 106–554—APPENDIX A

in the absence of such funds, would otherwise be spent for activities

under this section.

(4) No funds made available under this section may be used

to increase the salaries or provide benefits, other than participation

in professional development and enrichment programs, to teachers

who are not hired under this section. Funds under this section

may be used to pay the salary of teachers hired under section

307 of the Department of Education Appropriations Act, 1999, or

under section 310 of the Department of Education Appropriations

Act, 2000.

(d)(1) Each State receiving funds under this section shall report

on activities in the State under this section, consistent with section

6202(a)(2) of the Elementary and Secondary Education Act of 1965.

(2) Each State and local educational agency receiving funds

under this section shall publicly report to parents on its progress

in reducing class size, increasing the percentage of classes in core

academic areas taught by fully qualified teachers who are certified

within the State and demonstrate competency in the content areas

in which they teach, and on the impact that hiring additional

highly qualified teachers and reducing class size, has had, if any,

on increasing student academic achievement.

(3) Each school receiving funds under this section shall provide

to parents, upon request, the professional qualifications of their

child’s teacher.

(e) If a local educational agency uses funds made available

under this section for professional development activities, the

agency shall ensure for the equitable participation of private nonprofit elementary and secondary schools in such activities. Section

6402 of the Elementary and Secondary Education Act of 1965

shall not apply to other activities under this section.

(f ) A local educational agency that receives funds under this

section may use not more than 3 percent of such funds for local

administrative costs.

(g) Each local educational agency that desires to receive funds

under this section shall include in the application required under

section 6303 of the Elementary and Secondary Education Act of

1965 a description of the agency’s program to reduce class size

by hiring additional highly qualified teachers.

(h) No funds under this section may be used to pay the salary

of any teacher hired with funds under section 307 of the Department

of Education Appropriations Act, 1999, unless, by the start of the

2001–2002 school year, the teacher is certified within the State

(which may include certification through State or local alternative

routes) and demonstrates competency in the subject areas in which

he or she teaches.

(i) Not later than 30 days after the date of the enactment

of this Act, the Secretary shall provide specific notification to each

local educational agency eligible to receive funds under this part

regarding the flexibility provided under subsection (c)(2)(B)(ii) and

the ability to use such funds to carry out activities described in

subsection (c)(2)(A)(iii).

SEC. 307. Section 412 of the National Education Statistics

Act of 1994 (Public Law 103–382) is amended—

(1) in subsection 412(c)(1), after ‘‘period of’’ and before

‘‘years,’’, by striking ‘‘3’’ and inserting ‘‘4’’; and

(2) after ‘‘expiration of such term.’’, by adding the following

new subsection:

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–45

‘‘(4) CONFORMING PROVISION.—Members of the Board previously granted 3 year terms, whose terms are in effect on

the date of enactment of the Department of Education Appropriations Act, 2001, shall have their terms extended by 1 year.’’.

SEC. 308. (a) Section 435(a)(2) of the Higher Education Act

of 1965 (20 U.S.C. 1085(a)(2)) is amended by adding at the end

thereof the following new subparagraph: ‘‘(D) Notwithstanding the first sentence of subparagraph (A),

the Secretary shall restore the eligibility to participate in a program

under subpart 1 of part A, part B, or part D of an institution

that did not appeal its loss of eligibility within 30 days of receiving

notification if the Secretary determines, on a case-by-case basis,

that the institution’s failure to appeal was substantially justified

under the circumstances, and that— ‘‘(i) the institution made a timely request that the appropriate guaranty agency correct errors in the draft data used

to calculate the institution’s cohort default rate; ‘‘(ii) the guaranty agency did not correct the erroneous

data in a timely fashion; and ‘‘(iii) the institution would have been eligible if the erroneous data had been corrected by the guaranty agency.’’. (b) The amendment made by subsection (a) of this section

shall be effective for cohort default rate calculations for fiscal years

1997 and 1998.

SEC. 309. Section 439(r)(2) of the Higher Education Act of

1965 (20 U.S.C. 1087–2(r)(2)) is amended—

(1) in clause (A)(i), by striking ‘‘auditors and examiners’’

and inserting ‘‘and fix the compensation of such auditors and

examiners as may be necessary’’; and

(2) by inserting at the end of subparagraph (E) the following

new subparagraph:

‘‘(F) COMPENSATION OF AUDITORS AND EXAMINERS.—

‘‘(i) RATES OF PAY.—Rates of basic pay for all auditors and examiners appointed pursuant to subparagraph (A) may be set and adjusted by the Secretary

of the Treasury without regard to the provisions of

chapter 51 or subchapter III of chapter 53 of title

5, United States Code.

‘‘(ii) COMPARABILITY.—

‘‘(I) IN GENERAL.—Subject to section 5373 of

title 5, United States Code, the Secretary of the

Treasury may provide additional compensation

and benefits to auditors and examiners appointed

pursuant to subparagraph (A) if the same type

of compensation or benefits are then being provided by any agency referred to in section 1206

of the Financial Institutions Reform, Recovery, and

Enforcement Act of 1989 (12 U.S.C. 1833b) or,

if not then being provided, could be provided by

such an agency under applicable provisions of law,

rule, or regulation.

‘‘(II) CONSULTATION.—In setting and adjusting

the total amount of compensation and benefits for

auditors and examiners appointed pursuant to

subparagraph (A), the Secretary of the Treasury

shall consult with, and seek to maintain comparability with, the agencies referred to in section

114 STAT. 2763A–46 PUBLIC LAW 106–554—APPENDIX A

1206 of the Financial Institutions Reform, Recovery, and Enforcement Act of 1989 (12 U.S.C.

1833b).’’.

SEC. 310. Section 117(i) of the Carl D. Perkins Vocational

and Technical Education Act of 1998 (20 U.S.C. 2327(i)) is amended

by inserting ‘‘such sums as may be necessary for’’ before ‘‘each

of the 4 succeeding fiscal years.’’.

SEC. 311. Section 432(m)(1) of the Higher Education Act of

1965 (20 U.S.C. 1082(m)(1)) is amended—

(1) by striking clause (iv) of subparagraph (D); and

(2) by adding at the end the following new subparagraph:

‘‘(E) PERFECTION OF SECURITY INTERESTS IN STUDENT

LOANS.—

‘‘(i) IN GENERAL.—Notwithstanding the provisions

of any State law to the contrary, including the Uniform

Commercial Code as in effect in any State, a security

interest in loans made under this part, on behalf of

any eligible lender (as defined in section 435(d)) shall

attach, be perfected, and be assigned priority in the

manner provided by the applicable State’s law for

perfection of security interests in accounts, as such

law may be amended from time to time (including

applicable transition provisions). If any such State’s

law provides for a statutory lien to be created in such

loans, such statutory lien may be created by the entity

or entities governed by such State law in accordance

with the applicable statutory provisions that created

such a statutory lien.

‘‘(ii) COLLATERAL DESCRIPTION.—In addition to any

other method for describing collateral in a legally sufficient manner permitted under the laws of the State,

the description of collateral in any financing statement

filed pursuant to this subparagraph shall be deemed

legally sufficient if it lists such loans, or refers to

records (identifying such loans) retained by the secured

party or any designee of the secured party identified

in such financing statement, including the debtor or

any loan servicer.

‘‘(iii) SALES.—Notwithstanding clauses (i) and (ii)

and any provisions of any State law to the contrary,

other than any such State’s law providing for creation

of a statutory lien, an outright sale of loans made

under this part shall be effective and perfected automatically upon attachment as defined in the Uniform

Commercial Code of such State.’’.

SEC. 312. Section 435(a)(5) of the Higher Education Act of

1965 (20 U.S.C. 1085(a)(5)) is amended—

(1) in subparagraph (A)(i), by striking ‘‘July 1, 2002,’’ and

inserting ‘‘July 1, 2004,’’; and

(2) in subparagraph (B), by striking ‘‘1999, 2000, and 2001’’

and inserting ‘‘1999 through 2003’’.

SEC. 313. From the amounts made available for the ‘‘Fund

for the Improvement of Education’’ under the heading ‘‘Education

Research, Statistics, and Improvement’’, $10,000,000, to remain

available until expended, shall be available to the Secretary of

Education to be transferred to the Secretary of the Interior for

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–47

an award to the National Constitution Center for construction

activities authorized under Public Law 100–433.

SEC. 314. Section 4116(b)(4) of the Elementary and Secondary

Education Act of 1965 is amended by striking subparagraph (D)

and inserting in lieu thereof: ‘‘(D) the development and implementation of character education and training programs that reflect the

values of parents, teachers, and local communities, and incorporate

elements of good character, including honesty, citizenship, courage,

justice, respect, personal responsibility, and trustworthiness; and’’.

SEC. 315. The Secretary of Education shall review the nursing

program operated by Graceland University in Lamoni, Iowa, and

may exercise the waiver authority provided in section 102(a)(3)(B)

of the Higher Education Act of 1965, without regard to the provisions of 34 CFR 600.7(b)(3)(ii), if the Secretary determines that

such a waiver is appropriate.

SEC. 316. Section 415 of the Higher Education Act of 1965

is amended—

(1) in section 415A(a)(2), by striking ‘‘section 415F’’ and

inserting ‘‘section 415E’’; and

(2) in section 415E, by striking 415E(c) and inserting in

lieu thereof the following:

‘‘(c) AUTHORIZED ACTIVITIES.—Each State receiving a grant

under this section may use the grant funds for—

‘‘(1) making awards that—

‘‘(A) supplement grants received under section

415C(b)(2) by eligible students who demonstrate financial

need; or

‘‘(B) provide grants under section 415C(b)(2) to additional eligible students who demonstrate financial need;

‘‘(2) providing scholarships for eligible students—

‘‘(A) who demonstrate financial need; and

‘‘(B) who—

‘‘(i) desire to enter a program of study leading

to a career in—

‘‘(I) information technology;

‘‘(II) mathematics, computer science, or

engineering;

‘‘(III) teaching; or

‘‘(IV) another field determined by the State

to be critical to the State’s workforce needs; or

‘‘(ii) demonstrate merit or academic achievement;

and

‘‘(3) making awards that—

‘‘(A) supplement community service work-study awards

received under section 415C(b)(2) by eligible students who

demonstrate financial need; or

‘‘(B) provide community service work-study awards

under section 415C(b)(2) to additional eligible students who

demonstrate financial need.’’.

(3) in section 415E, adding at the end the following new

subsections:

‘‘(f ) SPECIAL RULE.—Notwithstanding subsection (d), for purposes of determining a State’s share of the cost of the authorized

activities described in subsection (c), the State shall consider only

those expenditures from non-Federal sources that exceed its total

expenditures for need-based grants, scholarships, and work-study

114 STAT. 2763A–48 PUBLIC LAW 106–554—APPENDIX A

assistance for fiscal year 1999 (including any such assistance provided under this subpart). ‘‘(g) USE OF FUNDS FOR ADMINISTRATIVE COSTS PROHIBITED.—

A State receiving a grant under this section shall not use any

of the grant funds to pay administrative costs associated with

any of the authorized activities described in subsection (c).’’. SEC. 317. (a) Section 402D of the Higher Education Act of

1965 (20 U.S.C. 1070a–14) is amended— (1) by redesignating subsection (c) as subsection (d); and

(2) by inserting after subsection (b) the following new subsection:

‘‘(c) SPECIAL RULE.— ‘‘(1) USE FOR STUDENT AID.—A recipient of a grant that

undertakes any of the permissible services identified in subsection (b) may, in addition, use such funds to provide grant

aid to students. A grant provided under this paragraph shall

not exceed the maximum appropriated Pell Grant or, be less

than the minimum appropriated Pell Grant, for the current

academic year. In making grants to students under this subsection, an institution shall ensure that adequate consultation

takes place between the student support service program office

and the institution’s financial aid office. ‘‘(2) ELIGIBLE STUDENTS.—For purposes of receiving grant

aid under this subsection, eligible students shall be current

participants in the student support services program offered

by the institution and be—

‘‘(A) students who are in their first 2 years of postsecondary education and who are receiving Federal Pell

Grants under subpart 1; or

‘‘(B) students who have completed their first 2 years

of postsecondary education and who are receiving Federal

Pell Grants under subpart 1 if the institution demonstrates

to the satisfaction of the Secretary that—

‘‘(i) these students are at high risk of dropping

out; and ‘‘(ii) it will first meet the needs of all its eligible

first- and second-year students for services under this

paragraph.

‘‘(3) DETERMINATION OF NEED.—A grant provided to a student under paragraph (1) shall not be considered in determining

that student’s need for grant or work assistance under this

title, except that in no case shall the total amount of student

financial assistance awarded to a student under this title exceed

that student’s cost of attendance, as defined in section 472.

‘‘(4) MATCHING REQUIRED.—A recipient of a grant who uses

such funds for the purpose described in paragraph (1) shall

match the funds used for such purpose, in cash, from nonFederal funds, in an amount that is not less than 33 percent

of the total amount of funds used for that purpose. This paragraph shall not apply to any grant recipient that is an institution of higher education eligible to receive funds under part

A or B of title III or title V.

‘‘(5) RESERVATION.—In no event may a recipient use more

than 20 percent of the funds received under this section for

grant aid.

‘‘(6) SUPPLEMENT, NOT SUPPLANT.—Funds received by a

grant recipient that are used under this subsection shall be

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–49

used to supplement, and not supplant, non-Federal funds

expended for student support services programs.’’. (b) The amendments made by subsection (a) shall apply with

respect to student support services grants awarded on or after

the date of enactment of this Act.

SEC. 318. (a) Subparagraph (B) of section 427A(c)(4) of the

Higher Education Act of 1965 (20 U.S.C. 1077a(c)(4)) is amended

to read as follows: ‘‘(B)(i) For any 12-month period beginning on July 1

and ending on or before June 30, 2001, the rate determined

under this subparagraph is determined on the preceding

June 1 and is equal to— ‘‘(I) the bond equivalent rate of 52-week Treasury

bills auctioned at the final auction held prior to such

June 1; plus ‘‘(II) 3.25 percent. ‘‘(ii) For any 12-month period beginning on July 1

of 2001 or any succeeding year, the rate determined under

this subparagraph is determined on the preceding June

26 and is equal to— ‘‘(I) the weekly average 1-year constant maturity

Treasury yield, as published by the Board of Governors

of the Federal Reserve System, for the last calendar

week ending on or before such June 26; plus ‘‘(II) 3.25 percent.’’. (b) Subparagraph (A) of section 455(b)(4) of such Act (20 U.S.C.

1087e(b)(4)) is amended to read as follows:

‘‘(A)(i) For Federal Direct PLUS Loans for which the

first disbursement is made on or after July 1, 1994, the

applicable rate of interest shall, during any 12-month

period beginning on July 1 and ending on or before June

30, 2001, be determined on the preceding June 1 and

be equal to—

‘‘(I) the bond equivalent rate of 52-week Treasury

bills auctioned at final auction held prior to such June

1; plus

‘‘(II) 3.1 percent,

except that such rate shall not exceed 9 percent.

‘‘(ii) For any 12-month period beginning on July 1

of 2001 or any succeeding year, the applicable rate of

interest determined under this subparagraph shall be

determined on the preceding June 26 and be equal to—

‘‘(I) the weekly average 1-year constant maturity

Treasury yield, as published by the Board of Governors

of the Federal Reserve System, for the last calendar

week ending on or before such June 26; plus

‘‘(II) 3.1 percent,

except that such rate shall not exceed 9 percent.’’.

SEC. 319. Section 1543 of the Higher Education Amendments

of 1992 (20 U.S.C. 1070 note) is amended by adding at the end

the following new subsection: ‘‘(e) DESIGNATION.—Scholarships awarded under this section

shall be known as ‘B.J. Stupak Olympic Scholarships’.’’.

SEC. 320. (a) Subject to subsection (c), the Secretary of Education shall release the reversionary interests that were retained

by the United States, as part of the conveyance of certain real

property situated in the County of Marin, State of California, in

114 STAT. 2763A–50 PUBLIC LAW 106–554—APPENDIX A

an April 3, 1978 Quitclaim Deed, which was filed for record on

June 5, 1978, in Book 3384, at page 33, of the official Records

of Marin County, California.

(b) The Secretary shall execute the release of the reversionary

interests under subsection (a) without consideration.

(c) The Secretary shall execute and file in the appropriate

office or offices a deed of release, amended deed, or other appropriate instruments effectuating the release of the reversionary

interests under subsection (a). In all other respects the provisions

of the April 3, 1978 Quitclaim Deed shall remain intact.

SEC. 321. (a) GRANTS TO NATIVE AMERICAN SCHOOLS AND STATE

EDUCATIONAL AGENCIES.— (1) ALLOCATION OF FUNDS.—Of the amount made available

under the heading ‘‘School improvement programs’’ for grants

made in accordance with this section for school repair and

renovation, activities under part B of the Individuals with

Disabilities Education Act (20 U.S.C. 1411 et seq.), and technology activities, the Secretary of Education shall allocate— (A) $75,000,000 for grants to impacted local educational

agencies (as defined in paragraph (3)) for school repair,

renovation, and construction;

(B) $3,250,000 for grants to outlying areas for school

repair and renovation in high-need schools and communities, allocated on such basis, and subject to such terms

and conditions, as the Secretary determines appropriate; (C) $25,000,000 for grants to public entities, private

nonprofit entities, and consortia of such entities, for use

in accordance with subpart 2 of part C of title X of the

Elementary and Secondary Education Act of 1965; and

(D) the remainder to State educational agencies in

proportion to the amount each State received under part

A of title I of the Elementary and Secondary Education

Act of 1965 (20 U.S.C. 6311 et seq.) for fiscal year 2000,

except that no State shall receive less than 0.5 percent

of the amount allocated under this subparagraph.

(2) DETERMINATION OF GRANT AMOUNT.—

(A) DETERMINATION OF WEIGHTED STUDENT UNITS.—

For purposes of computing the grant amounts under paragraph (1)(A) for fiscal year 2001, the Secretary shall determine the results obtained by the computation made under

section 8003 of the Elementary and Secondary Education

Act of 1965 (20 U.S.C. 7703) with respect to children

described in subsection (a)(1)(C) of such section and computed under subsection (a)(2)(B) of such section for such

year—

(i) for each impacted local educational agency that

receives funds under this section; and

(ii) for all such agencies together.

(B) COMPUTATION OF PAYMENT.—For fiscal year 2001,

the Secretary shall calculate the amount of a grant to

an impacted local educational agency by— (i) dividing the amount described in paragraph

(1)(A) by the results of the computation described in

subparagraph (A)(ii); and

(ii) multiplying the number derived under clause

(i) by the results of the computation described in

subparagraph (A)(i) for such agency.

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–51

(3) DEFINITION.—For purposes of this section, the term ‘‘impacted local educational agency’’ means, for fiscal year

2001— (A) a local educational agency that receives a basic

support payment under section 8003(b) of the Elementary

and Secondary Education Act of 1965 (20 U.S.C. 7703(b))

for such fiscal year; and

(B) with respect to which the number of children determined under section 8003(a)(1)(C) of such Act for the

preceding school year constitutes at least 50 percent of

the total student enrollment in the schools of the agency

during such school year.

(b) WITHIN-STATE ALLOCATIONS.— (1) ADMINISTRATIVE COSTS.— (A) STATE EDUCATIONAL AGENCY ADMINISTRATION.— Except as provided in subparagraph (B), each State educational agency may reserve not more than 1 percent of

its allocation under subsection (a)(1)(D) for the purpose

of administering the distribution of grants under this subsection.

(B) STATE ENTITY ADMINISTRATION.—If the State educational agency transfers funds to a State entity described

in paragraph (2)(A), the agency shall transfer to such entity

0.75 of the amount reserved under this paragraph for the

purpose of administering the distribution of grants under

this subsection.

(2) RESERVATION FOR COMPETITIVE SCHOOL REPAIR AND RENOVATION GRANTS TO LOCAL EDUCATIONAL AGENCIES.—

(A) IN GENERAL.—Subject to the reservation under

paragraph (1), of the funds allocated to a State educational

agency under subsection (a)(1)(D), the State educational

agency shall distribute 75 percent of such funds to local

educational agencies or, if such State educational agency

is not responsible for the financing of education facilities,

the agency shall transfer such funds to the State entity

responsible for the financing of education facilities (referred

to in this section as the ‘‘State entity’’) for distribution

by such entity to local educational agencies in accordance

with this paragraph, to be used, consistent with subsection

(c), for school repair and renovation.

(B) COMPETITIVE GRANTS TO LOCAL EDUCATIONAL AGENCIES.—

(i) IN GENERAL.—The State educational agency or

State entity shall carry out a program of competitive

grants to local educational agencies for the purpose

described in subparagraph (A). Of the total amount

available for distribution to such agencies under this

paragraph, the State educational agency or State

entity, shall, in carrying out the competition—

(I) award to high poverty local educational

agencies described in clause (ii), in the aggregate,

at least an amount which bears the same relationship to such total amount as the aggregate amount

such local educational agencies received under part

A of title I of the Elementary and Secondary Education Act of 1965 for fiscal year 2000 bears to

the aggregate amount received for such fiscal year

114 STAT. 2763A–52 PUBLIC LAW 106–554—APPENDIX A

under such part by all local educational agencies

in the State;

(II) award to rural local educational agencies

in the State, in the aggregate, at least an amount

which bears the same relationship to such total

amount as the aggregate amount such rural local

educational agencies received under part A of title

I of the Elementary and Secondary Education Act

of 1965 for fiscal year 2000 bears to the aggregate

amount received for such fiscal year under such

part by all local educational agencies in the State;

and

(III) award the remaining funds to local educational agencies not receiving an award under

subclause (I) or (II), including high poverty and

rural local educational agencies that did not

receive such an award.

(ii) HIGH POVERTY LOCAL EDUCATIONAL AGENCIES.—A local educational agency is described in this

clause if—

(I) the percentage described in subparagraph

(C)(i) with respect to the agency is 30 percent

or greater; or

(II) the number of children described in such

subparagraph with respect to the agency is at

least 10,000.

(C) CRITERIA FOR AWARDING GRANTS.—In awarding

competitive grants under this paragraph, a State educational agency or State entity shall take into account

the following criteria:

(i) The percentage of poor children 5 to 17 years

of age, inclusive, in a local educational agency.

(ii) The need of a local educational agency for

school repair and renovation, as demonstrated by the

condition of its public school facilities.

(iii) The fiscal capacity of a local educational

agency to meet its needs for repair and renovation

of public school facilities without assistance under this

section, including its ability to raise funds through

the use of local bonding capacity and otherwise.

(iv) In the case of a local educational agency that

proposes to fund a repair or renovation project for

a charter school or schools, the extent to which the

school or schools have access to funding for the project

through the financing methods available to other public

schools or local educational agencies in the State.

(v) The likelihood that the local educational agency

will maintain, in good condition, any facility whose

repair or renovation is assisted under this section.

(D) POSSIBLE MATCHING REQUIREMENT.—

(i) IN GENERAL.—A State educational agency or

State entity may require local educational agencies

to match funds awarded under this subsection.

(ii) MATCH AMOUNT.—The amount of a match

described in clause (i) may be established by using

a sliding scale that takes into account the relative

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–53

poverty of the population served by the local educational agency.

(3) RESERVATION FOR COMPETITIVE IDEA OR TECHNOLOGY

GRANTS TO LOCAL EDUCATIONAL AGENCIES.— (A) IN GENERAL.—Subject to the reservation under

paragraph (1), of the funds allocated to a State educational

agency under subsection (a)(1)(D), the State educational

agency shall distribute 25 percent of such funds to local

educational agencies through competitive grant processes,

to be used for the following:

(i) To carry out activities under part B of the

Individuals with Disabilities Education Act (20 U.S.C.

1411 et seq.).

(ii) For technology activities that are carried out

in connection with school repair and renovation,

including—

(I) wiring;

(II) acquiring hardware and software;

(III) acquiring connectivity linkages and

resources; and

(IV) acquiring microwave, fiber optics, cable,

and satellite transmission equipment.

(B) CRITERIA FOR AWARDING IDEA GRANTS.—In awarding competitive grants under subparagraph (A) to be used

to carry out activities under part B of the Individuals

with Disabilities Education Act (20 U.S.C. 1411 et seq.),

a State educational agency shall take into account the

following criteria:

(i) The need of a local educational agency for additional funds for a student whose individually allocable

cost for expenses related to the Individuals with

Disabilities Education Act substantially exceeds the

State’s average per-pupil expenditure (as defined in

section 14101(2) of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 8801(2))).

(ii) The need of a local educational agency for

additional funds for special education and related services under part B of the Individuals with Disabilities

Education Act (20 U.S.C. 1411 et seq.).

(iii) The need of a local educational agency for

additional funds for assistive technology devices (as

defined in section 602 of the Individuals with Disabilities Education Act (20 U.S.C. 1401)) or assistive technology services (as so defined) for children being served

under part B of the Individuals with Disabilities Education Act (20 U.S.C. 1411 et seq.).

(iv) The need of a local educational agency for

additional funds for activities under part B of the

Individuals with Disabilities Education Act (20 U.S.C.

1411 et seq.) in order for children with disabilities

to make progress toward meeting the performance

goals and indicators established by the State under

section 612(a)(16) of such Act (20 U.S.C. 1412).

(C) CRITERIA FOR AWARDING TECHNOLOGY GRANTS.—

In awarding competitive grants under subparagraph (A)

to be used for technology activities that are carried out

in connection with school repair and renovation, a State

114 STAT. 2763A–54 PUBLIC LAW 106–554—APPENDIX A

educational agency shall take into account the need of

a local educational agency for additional funds for such

activities, including the need for the activities described

in subclauses (I) through (IV) of subparagraph (A)(ii).

(c) RULES APPLICABLE TO SCHOOL REPAIR AND RENOVATION.— With respect to funds made available under this section that are

used for school repair and renovation, the following rules shall

apply:

(1) PERMISSIBLE USES OF FUNDS.—School repair and renovation shall be limited to one or more of the following:

(A) Emergency repairs or renovations to public school

facilities only to ensure the health and safety of students

and staff, including— (i) repairing, replacing, or installing roofs, electrical wiring, plumbing systems, or sewage systems;

(ii) repairing, replacing, or installing heating, ventilation, or air conditioning systems (including insulation); and

(iii) bringing public schools into compliance with

fire and safety codes.

(B) School facilities modifications necessary to render

public school facilities accessible in order to comply with

the Americans with Disabilities Act of 1990 (42 U.S.C.

12101 et seq.).

(C) School facilities modifications necessary to render

public school facilities accessible in order to comply with

section 504 of the Rehabilitation Act of 1973 (29 U.S.C.

794).

(D) Asbestos abatement or removal from public school

facilities.

(E) Renovation, repair, and acquisition needs related

to the building infrastructure of a charter school.

(2) IMPERMISSIBLE USES OF FUNDS.—No funds received

under this section may be used for—

(A) payment of maintenance costs in connection with

any projects constructed in whole or in part with Federal

funds provided under this section;

(B) the construction of new facilities, except for facilities for an impacted local educational agency (as defined

in subsection (a)(3)); or

(C) stadiums or other facilities primarily used for athletic contests or exhibitions or other events for which admission is charged to the general public.

(3) CHARTER SCHOOLS.—A public charter school that constitutes a local educational agency under State law shall be

eligible for assistance under the same terms and conditions

as any other local educational agency (as defined in section

14101(18) of the Elementary and Secondary Education Act of

1965 (20 U.S.C. 8801(18))).

(4) SUPPLEMENT, NOT SUPPLANT.—Excluding the uses

described in subparagraphs (B) and (C) of paragraph (1), a

local educational agency shall use Federal funds subject to

this subsection only to supplement the amount of funds that

would, in the absence of such Federal funds, be made available

from non-Federal sources for school repair and renovation.

(d) SPECIAL RULE.—Each local educational agency that receives

funds under this section shall ensure that, if it carries out repair

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–55

or renovation through a contract, any such contract process ensures

the maximum number of qualified bidders, including small, minority, and women-owned businesses, through full and open competition.

(e) PUBLIC COMMENT.—Each local educational agency receiving

funds under paragraph (2) or (3) of subsection (b)— (1) shall provide parents, educators, and all other interested

members of the community the opportunity to consult on the

use of funds received under such paragraph;

(2) shall provide the public with adequate and efficient

notice of the opportunity described in paragraph (1) in a widely

read and distributed medium; and

(3) shall provide the opportunity described in paragraph

(1) in accordance with any applicable State and local law specifying how the comments may be received and how the comments may be reviewed by any member of the public.

(f ) REPORTING.—

(1) LOCAL REPORTING.—Each local educational agency

receiving funds under subsection (a)(1)(D) shall submit a report

to the State educational agency, at such time as the State

educational agency may require, describing the use of such

funds for—

(A) school repair and renovation (and construction, in

the case of an impacted local educational agency (as defined

in subsection (a)(3)));

(B) activities under part B of the Individuals with

Disabilities Education Act (20 U.S.C. 1411 et seq.); and

(C) technology activities that are carried out in connection with school repair and renovation, including the activities described in subclauses (I) through (IV) of subsection

(b)(3)(A)(ii).

(2) STATE REPORTING.—Each State educational agency shall

submit to the Secretary of Education, not later than December

31, 2002, a report on the use of funds received under subsection

(a)(1)(D) by local educational agencies for— (A) school repair and renovation (and construction, in

the case of an impacted local educational agency (as defined

in subsection (a)(3)));

(B) activities under part B of the Individuals with

Disabilities Education Act (20 U.S.C. 1411 et seq.); and

(C) technology activities that are carried out in connection with school repair and renovation, including the activities described in subclauses (I) through (IV) of subsection

(b)(3)(A)(ii).

(3) ADDITIONAL REPORTS.—Each entity receiving funds allocated under subsection (a)(1)(A) or (B) shall submit to the

Secretary, not later than December 31, 2002, a report on its

uses of funds under this section, in such form and containing

such information as the Secretary may require.

(g) APPLICABILITY OF PART B OF IDEA.—If a local educational

agency uses funds received under this section to carry out activities

under part B of the Individuals with Disabilities Education Act

(20 U.S.C. 1411 et seq.), such part (including provisions respecting

the participation of private school children), and any other provision

of law that applies to such part, shall apply to such use.

(h) REALLOCATION.—If a State educational agency does not

apply for an allocation of funds under subsection (a)(1)(D) for fiscal

114 STAT. 2763A–56 PUBLIC LAW 106–554—APPENDIX A

year 2001, or does not use its entire allocation for such fiscal

year, the Secretary may reallocate the amount of the State educational agency’s allocation (or the remainder thereof, as the case

may be) to the remaining State educational agencies in accordance

with subsection (a)(1)(D).

(i) PARTICIPATION OF PRIVATE SCHOOLS.—

(1) IN GENERAL.—Section 6402 of the Elementary and

Secondary Education Act of 1965 (20 U.S.C. 7372) shall apply

to subsection (b)(2) in the same manner as it applies to activities

under title VI of such Act, except that—

(A) such section shall not apply with respect to the

title to any real property renovated or repaired with assistance provided under this section;

(B) the term ‘‘services’’ as used in section 6402 of

such Act with respect to funds under this section shall

be provided only to private, nonprofit elementary or secondary schools with a rate of child poverty of at least 40

percent and may include for purposes of subsection (b)(2)

only—

(i) modifications of school facilities necessary to

meet the standards applicable to public schools under

the Americans with Disabilities Act of 1990 (42 U.S.C.

12101 et seq.);

(ii) modifications of school facilities necessary to

meet the standards applicable to public schools under

section 504 of the Rehabilitation Act of 1973 (29 U.S.C.

794); and

(iii) asbestos abatement or removal from school

facilities; and

(C) notwithstanding the requirements of section

6402(b) of the Elementary and Secondary Education Act

of 1965 (20 U.S.C. 7372(b)), expenditures for services provided using funds made available under subsection (b)(2)

shall be considered equal for purposes of such section if

the per-pupil expenditures for services described in

subparagraph (B) for students enrolled in private nonprofit

elementary and secondary schools that have child poverty

rates of at least 40 percent are consistent with the perpupil expenditures under this section for children enrolled

in the public schools in the school district of the local

educational agency receiving funds under this section.

(2) REMAINING FUNDS.—If the expenditure for services

described in paragraph (1)(B) is less than the amount calculated

under paragraph (1)(C) because of insufficient need for such

services, the remainder shall be available to the local educational agency for renovation and repair of public school facilities.

(3) APPLICATION.—If any provision of this section, or the

application thereof, to any person or circumstances is judicially

determined to be invalid, the provisions of the remainder of

the section and the application to other persons or circumstances shall not be affected thereby.

( j) DEFINITIONS.—For purposes of this section:

(1) CHARTER SCHOOL.—The term ‘‘charter school’’ has the

meaning given such term in section 10310(1) of the Elementary

and Secondary Education Act of 1965 (20 U.S.C. 8066(1)).

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–57

(2) ELEMENTARY SCHOOL.—The term ‘‘elementary school’’ has the meaning given such term in section 14101(14) of the

Elementary and Secondary Education Act of 1965 (20 U.S.C.

8801(14)).

(3) LOCAL EDUCATIONAL AGENCY.—The term ‘‘local educational agency’’ has the meaning given such term in subparagraphs (A) and (B) of section 14101(18) of the Elementary

and Secondary Education Act of 1965 (20 U.S.C. 8801(18)).

(4) OUTLYING AREA.—The term ‘‘outlying area’’ has the

meaning given such term in section 14101(21) of the

Elementary and Secondary Education Act of 1965 (20 U.S.C.

8801(21)).

(5) POOR CHILDREN AND CHILD POVERTY.—The terms ‘‘poor

children’’ and ‘‘child poverty’’ refer to children 5 to 17 years

of age, inclusive, who are from families with incomes below

the poverty line (as defined by the Office of Management and

Budget and revised annually in accordance with section 673(2)

of the Community Services Block Grant (42 U.S.C. 9902(2))

applicable to a family of the size involved for the most recent

fiscal year for which data satisfactory to the Secretary are

available.

(6) RURAL LOCAL EDUCATIONAL AGENCY.—The term ‘‘rural

local educational agency’’ means a local educational agency

that the State determines is located in a rural area using

objective data and a commonly employed definition of the term

‘‘rural’’.

(7) SECONDARY SCHOOL.—The term ‘‘secondary school’’ has

the meaning given such term in section 14101(25) of the

Elementary and Secondary Education Act of 1965 (20 U.S.C.

8801(25)).

(8) STATE.—The term ‘‘State’’ means each of the 50 States,

the District of Columbia, and the Commonwealth of Puerto

Rico.

SEC. 322. (a) Part C of title X of the Elementary and Secondary

Education Act of 1965 (20 U.S.C. 8061 et seq.) is amended— (1) by inserting after the part heading the following:

‘‘Subpart 1—Basic Charter School Grant

Program’’;

and

(2) by adding at the end the following:

‘‘Subpart 2—Credit Enhancement Initiatives To

Assist Charter School Facility Acquisition, Construction, and Renovation

‘‘SEC. 10321. PURPOSE.

‘‘The purpose of this subpart is to provide one-time grants

to eligible entities to permit them to demonstrate innovative credit

enhancement initiatives that assist charter schools to address the

cost of acquiring, constructing, and renovating facilities.

‘‘SEC. 10322. GRANTS TO ELIGIBLE ENTITIES.

‘‘(a) IN GENERAL.—The Secretary shall use 100 percent of the

amount available to carry out this subpart to award not less than

114 STAT. 2763A–58 PUBLIC LAW 106–554—APPENDIX A

three grants to eligible entities having applications approved under

this subpart to demonstrate innovative methods of assisting charter

schools to address the cost of acquiring, constructing, and renovating

facilities by enhancing the availability of loans or bond financing.

‘‘(b) GRANTEE SELECTION.—The Secretary shall evaluate each

application submitted, and shall make a determination of which

are sufficient to merit approval and which are not. The Secretary

shall award at least one grant to an eligible entity described in

section 10330(2)(A), at least one grant to an eligible entity described

in section 10330(2)(B), and at least one grant to an eligible entity

described in section 10330(2)(C), if applications are submitted that

permit the Secretary to do so without approving an application

that is not of sufficient quality to merit approval.

‘‘(c) GRANT CHARACTERISTICS.—Grants under this subpart shall

be of a sufficient size, scope, and quality so as to ensure an effective

demonstration of an innovative means of enhancing credit for the

financing of charter school acquisition, construction, or renovation.

‘‘(d) SPECIAL RULE.—In the event the Secretary determines

that the funds available are insufficient to permit the Secretary

to award not less than three grants in accordance with subsections

(a) through (c), such three-grant minimum and the second sentence

of subsection (b) shall not apply, and the Secretary may determine

the appropriate number of grants to be awarded in accordance

with subsection (c).

‘‘SEC. 10323. APPLICATIONS.

‘‘(a) IN GENERAL.—To receive a grant under this subpart, an

eligible entity shall submit to the Secretary an application in such

form as the Secretary may reasonably require.

‘‘(b) CONTENTS.—An application under subsection (a) shall

contain—

‘‘(1) a statement identifying the activities proposed to be

undertaken with funds received under this subpart, including

how the applicant will determine which charter schools will

receive assistance, and how much and what types of assistance

charter schools will receive;

‘‘(2) a description of the involvement of charter schools

in the application’s development and the design of the proposed

activities;

‘‘(3) a description of the applicant’s expertise in capital

market financing;

‘‘(4) a description of how the proposed activities will leverage the maximum amount of private-sector financing capital

relative to the amount of government funding used and otherwise enhance credit available to charter schools;

‘‘(5) a description of how the applicant possesses sufficient

expertise in education to evaluate the likelihood of success

of a charter school program for which facilities financing is

sought;

‘‘(6) in the case of an application submitted by a State

governmental entity, a description of the actions that the entity

has taken, or will take, to ensure that charter schools within

the State receive the funding they need to have adequate facilities; and

‘‘(7) such other information as the Secretary may reasonably require.

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–59

‘‘SEC. 10324. CHARTER SCHOOL OBJECTIVES.

‘‘An eligible entity receiving a grant under this subpart shall

use the funds deposited in the reserve account established under

section 10325(a) to assist one or more charter schools to access

private sector capital to accomplish one or both of the following

objectives: ‘‘(1) The acquisition (by purchase, lease, donation, or otherwise) of an interest (including an interest held by a third

party for the benefit of a charter school) in improved or unimproved real property that is necessary to commence or continue

the operation of a charter school. ‘‘(2) The construction of new facilities, or the renovation,

repair, or alteration of existing facilities, necessary to commence

or continue the operation of a charter school.

‘‘SEC. 10325. RESERVE ACCOUNT.

‘‘(a) USE OF FUNDS.—To assist charter schools to accomplish

the objectives described in section 10324, an eligible entity receiving

a grant under this subpart shall, in accordance with State and

local law, directly or indirectly, alone or in collaboration with others,

deposit the funds received under this subpart (other than funds

used for administrative costs in accordance with section 10326)

in a reserve account established and maintained by the entity

for this purpose. Amounts deposited in such account shall be used

by the entity for one or more of the following purposes: ‘‘(1) Guaranteeing, insuring, and reinsuring bonds, notes,

evidences of debt, loans, and interests therein, the proceeds

of which are used for an objective described in section 10324. ‘‘(2) Guaranteeing and insuring leases of personal and real

property for an objective described in section 10324. ‘‘(3) Facilitating financing by identifying potential lending

sources, encouraging private lending, and other similar activities that directly promote lending to, or for the benefit of,

charter schools. ‘‘(4) Facilitating the issuance of bonds by charter schools,

or by other public entities for the benefit of charter schools,

by providing technical, administrative, and other appropriate

assistance (including the recruitment of bond counsel, underwriters, and potential investors and the consolidation of multiple charter school projects within a single bond issue).

‘‘(b) INVESTMENT.—Funds received under this subpart and

deposited in the reserve account shall be invested in obligations

issued or guaranteed by the United States or a State, or in other

similarly low-risk securities.

‘‘(c) REINVESTMENT OF EARNINGS.—Any earnings on funds

received under this subpart shall be deposited in the reserve account

established under subsection (a) and used in accordance with such

subsection.

‘‘SEC. 10326. LIMITATION ON ADMINISTRATIVE COSTS.

‘‘An eligible entity may use not more than 0.25 percent of

the funds received under this subpart for the administrative costs

of carrying out its responsibilities under this subpart.

‘‘SEC. 10327. AUDITS AND REPORTS.

‘‘(a) FINANCIAL RECORD MAINTENANCE AND AUDIT.—The financial records of each eligible entity receiving a grant under this

subpart shall be maintained in accordance with generally accepted

114 STAT. 2763A–60 PUBLIC LAW 106–554—APPENDIX A

accounting principles and shall be subject to an annual audit by

an independent public accountant. ‘‘(b) REPORTS.—

‘‘(1) GRANTEE ANNUAL REPORTS.—Each eligible entity

receiving a grant under this subpart annually shall submit

to the Secretary a report of its operations and activities under

this subpart. ‘‘(2) CONTENTS.—Each such annual report shall include— ‘‘(A) a copy of the most recent financial statements,

and any accompanying opinion on such statements, prepared by the independent public accountant reviewing the

financial records of the eligible entity; ‘‘(B) a copy of any report made on an audit of the

financial records of the eligible entity that was conducted

under subsection (a) during the reporting period; ‘‘(C) an evaluation by the eligible entity of the effectiveness of its use of the Federal funds provided under this

subpart in leveraging private funds; ‘‘(D) a listing and description of the charter schools

served during the reporting period; ‘‘(E) a description of the activities carried out by the

eligible entity to assist charter schools in meeting the objectives set forth in section 10324; and ‘‘(F) a description of the characteristics of lenders and

other financial institutions participating in the activities

undertaken by the eligible entity under this subpart during

the reporting period.

‘‘(3) SECRETARIAL REPORT.—The Secretary shall review the

reports submitted under paragraph (1) and shall provide a

comprehensive annual report to Congress on the activities conducted under this subpart.

‘‘SEC. 10328. NO FULL FAITH AND CREDIT FOR GRANTEE OBLIGATIONS.

‘‘No financial obligation of an eligible entity entered into pursuant to this subpart (such as an obligation under a guarantee,

bond, note, evidence of debt, or loan) shall be an obligation of,

or guaranteed in any respect by, the United States. The full faith

and credit of the United States is not pledged to the payment

of funds which may be required to be paid under any obligation

made by an eligible entity pursuant to any provision of this subpart.

‘‘SEC. 10329. RECOVERY OF FUNDS.

‘‘(a) IN GENERAL.—The Secretary, in accordance with chapter

37 of title 31, United States Code, shall collect—

‘‘(1) all of the funds in a reserve account established by

an eligible entity under section 10325(a) if the Secretary determines, not earlier than 2 years after the date on which the

entity first received funds under this subpart, that the entity

has failed to make substantial progress in carrying out the

purposes described in section 10325(a); or

‘‘(2) all or a portion of the funds in a reserve account

established by an eligible entity under section 10325(a) if the

Secretary determines that the eligible entity has permanently

ceased to use all or a portion of the funds in such account

to accomplish any purpose described in section 10325(a).

‘‘(b) EXERCISE OF AUTHORITY.—The Secretary shall not exercise

the authority provided in subsection (a) to collect from any eligible

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–61

entity any funds that are being properly used to achieve one or

more of the purposes described in section 10325(a). ‘‘(c) PROCEDURES.—The provisions of sections 451, 452, and

458 of the General Education Provisions Act (20 U.S.C. 1234 et

seq.) shall apply to the recovery of funds under subsection (a). ‘‘(d) CONSTRUCTION.—This section shall not be construed to

impair or affect the authority of the Secretary to recover funds

under part D of the General Education Provisions Act (20 U.S.C.

1234 et seq.).

‘‘SEC. 10330. DEFINITIONS.

‘‘In this subpart: ‘‘(1) The term ‘charter school’ has the meaning given such

term in section 10310. ‘‘(2) The term ‘eligible entity’ means— ‘‘(A) a public entity, such as a State or local governmental entity; ‘‘(B) a private nonprofit entity; or

‘‘(C) a consortium of entities described in subparagraphs (A) and (B).

‘‘SEC. 10331. AUTHORIZATION OF APPROPRIATIONS.

‘‘For the purpose of carrying out this subpart, there are authorized to be appropriated $100,000,000 for fiscal year 2001.’’.

(b) Part C of title X of the Elementary and Secondary Education

Act of 1965 (20 U.S.C. 8061 et seq.) is amended in each of the

following provisions by striking ‘‘part’’ each place such term appears

and inserting ‘‘subpart’’:

(1) Sections 10301 through 10305.

(2) Section 10307.

(3) Sections 10309 through 10311.

SEC. 323. (a) Section 8003(b)(2)(F) of the Elementary and

Secondary Education Act of 1965 (20 U.S.C. 7703(b)(2)(F)) is

amended—

(1) by striking ‘‘the Secretary shall use’’ and inserting ‘‘the

Secretary—

‘‘(i) shall use’’;

(2) by striking the period at the end and inserting ‘‘; and’’;

and

(3) by adding at the end the following:

‘‘(ii) except as provided in subparagraph (C)(i)(I),

shall include all of the children described in subparagraphs (F) and (G) of subsection (a)(1) enrolled in

schools of the local educational agency in determining

(I) the eligibility of the agency for assistance under

this paragraph, and (II) the amount of such assistance

if the number of such children meet the requirements

of subsection (a)(3).’’.

(b) Section 8003(b)(2) of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 7703(b)(2)) is amended by adding

at the end the following:

‘‘(G) DETERMINATION OF AVERAGE TAX RATES FOR GENERAL FUND PURPOSES.—For the purpose of determining

average tax rates for general fund purposes for local educational agencies in a State under this paragraph (except

under subparagraph (C)(i)(II)(bb)), the Secretary shall use

either—

114 STAT. 2763A–62 PUBLIC LAW 106–554—APPENDIX A

‘‘(i) the average tax rate for general fund purposes

for comparable local educational agencies, as determined by the Secretary in regulations; or ‘‘(ii) the average tax rate of all the local educational

agencies in the State.’’.

This title may be cited as the ‘‘Department of Education Appropriations Act, 2001’’.

TITLE IV—RELATED AGENCIES

ARMED FORCES RETIREMENT HOME

For expenses necessary for the Armed Forces Retirement Home

to operate and maintain the United States Soldiers’ and Airmen’s

Home and the United States Naval Home, to be paid from funds

available in the Armed Forces Retirement Home Trust Fund,

$69,832,000, of which $9,832,000 shall remain available until

expended for construction and renovation of the physical plants

at the United States Soldiers’ and Airmen’s Home and the United

States Naval Home: Provided, That, notwithstanding any other

provision of law, a single contract or related contracts for development and construction, to include construction of a long-term care

facility at the United States Naval Home, may be employed which

collectively include the full scope of the project: Provided further,

That the solicitation and contract shall contain the clause ‘‘availability of funds’’ found at 48 CFR 52.232–18 and 252.232–7007, Limitation of Government Obligations.

CORPORATION FOR NATIONAL AND COMMUNITY SERVICE

DOMESTIC VOLUNTEER SERVICE PROGRAMS, OPERATING EXPENSES

For expenses necessary for the Corporation for National and

Community Service to carry out the provisions of the Domestic

Volunteer Service Act of 1973, as amended, $303,850,000: Provided,

That none of the funds made available to the Corporation for

National and Community Service in this Act for activities authorized by part E of title II of the Domestic Volunteer Service Act

of 1973 shall be used to provide stipends or other monetary incentives to volunteers or volunteer leaders whose incomes exceed 125

percent of the national poverty level.

CORPORATION FOR PUBLIC BROADCASTING

For payment to the Corporation for Public Broadcasting, as

authorized by the Communications Act of 1934, an amount which

shall be available within limitations specified by that Act, for the

fiscal year 2003, $365,000,000: Provided, That no funds made available to the Corporation for Public Broadcasting by this Act shall

be used to pay for receptions, parties, or similar forms of entertainment for Government officials or employees: Provided further, That

none of the funds contained in this paragraph shall be available

or used to aid or support any program or activity from which

any person is excluded, or is denied benefits, or is discriminated

against, on the basis of race, color, national origin, religion, or

sex: Provided further, That in addition to the amounts provided

above, $20,000,000, to remain available until expended, shall be

for digitalization, pending enactment of authorizing legislation.

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–63

FEDERAL MEDIATION AND CONCILIATION SERVICE

SALARIES AND EXPENSES

For expenses necessary for the Federal Mediation and Conciliation Service to carry out the functions vested in it by the Labor

Management Relations Act, 1947 (29 U.S.C. 171–180, 182–183),

including hire of passenger motor vehicles; for expenses necessary

for the Labor-Management Cooperation Act of 1978 (29 U.S.C.

175a); and for expenses necessary for the Service to carry out

the functions vested in it by the Civil Service Reform Act, Public

Law 95–454 (5 U.S.C. ch. 71), $38,200,000, including $1,500,000,

to remain available through September 30, 2002, for activities

authorized by the Labor-Management Cooperation Act of 1978 (29

U.S.C. 175a): Provided, That notwithstanding 31 U.S.C. 3302, fees

charged, up to full-cost recovery, for special training activities and

other conflict resolution services and technical assistance, including

those provided to foreign governments and international organizations, and for arbitration services shall be credited to and merged

with this account, and shall remain available until expended: Provided further, That fees for arbitration services shall be available

only for education, training, and professional development of the

agency workforce: Provided further, That the Director of the Service

is authorized to accept and use on behalf of the United States

gifts of services and real, personal, or other property in the aid

of any projects or functions within the Director’s jurisdiction.

FEDERAL MINE SAFETY AND HEALTH REVIEW COMMISSION

SALARIES AND EXPENSES

For expenses necessary for the Federal Mine Safety and Health Review Commission (30 U.S.C. 801 et seq.), $6,320,000.

INSTITUTE OF MUSEUM AND LIBRARY SERVICES

OFFICE OF LIBRARY SERVICES: GRANTS AND ADMINISTRATION

For carrying out subtitle B of the Museum and Library Services Act, $207,219,000: Provided, That of the amount provided, $1,000,000 shall be awarded to the National Museum of Women

in the Arts in Washington, D.C., $700,000 shall be awarded to

the University of Idaho Institute for the Historic Study of Jazz,

$2,600,000 shall be awarded to Southeast Missouri State University

River Campus and Museum, $900,000 shall be awarded to the

Heritage Harbor Museum in Rhode Island, $500,000 shall be

awarded to the Alaska Native Heritage Center, $576,000 shall

be awarded to the Franklin Institute in Philadelphia, $925,000

shall be awarded to the Please Touch Museum, $250,000 shall

be awarded to the Pittsburgh Children’s Museum, $510,000 shall

be awarded to the Temple University Library, $1,800,000 shall

be awarded to Franklin Pierce College in New Hampshire, $500,000

shall be awarded to the Louisville Zoo in Kentucky, $150,000 shall

be awarded to the Oregon Historical Society, $1,200,000 shall be

awarded to the Mississippi River Museum and Discovery Center

in Dubuque, Iowa, $650,000 shall be awarded to the Salisbury

House Foundation in Des Moines, Iowa, $150,000 shall be awarded

to the History Center for the Linn County Historical Museum

in Iowa, $4,000,000 shall be awarded to the Newsline for the

114 STAT. 2763A–64 PUBLIC LAW 106–554—APPENDIX A

Blind, of which $100,000 shall be awarded to the Iowa Newsline

for the Blind and $100,000 shall be awarded to the West Virginia

Newsline for the Blind, $1,000,000 shall be awarded to the Clay

Center for the Arts and Sciences, $650,000 shall be awarded to

Bishops Museum in Hawaii, $500,000 shall be awarded to the

Wisconsin Maritime Museum, $250,000 shall be awarded to the

Natural History Museum of Los Angeles, $400,000 shall be awarded

to the Perkins Geology Museum at the University of Vermont,

$400,000 shall be awarded to the Walt Whitman Cultural Arts

Center in Camden, New Jersey, $400,000 shall be awarded to

the Plainfield Public Library in Plainfield, New Jersey, $150,000

shall be awarded to the Ducktown Arts District in Atlantic City,

New Jersey, $400,000 shall be awarded to the Lake Champlain

Science Center in Vermont, $250,000 shall be awarded to the

Foundation for the Arts, Music, and Entertainment of ShreveportBossier, Inc., $100,000 shall be awarded to Bryant College in Rhode

Island, $120,000 shall be awarded to the Fenton Historical Museum

of Jamestown, New York, $921,000 shall be awarded to the Mariners’ Museum in Newport News, Virginia, $461,000 shall be

awarded to DuPage County Children’s Museum in Naperville,

Illinois, $369,000 shall be awarded to the National Baseball Hall

of Fame Library in Cooperstown, New York, $92,000 shall be

awarded to the City of Corona, Riverside, California, $6,000 shall

be awarded to the City of Murrieta, California Public Library,

$1,382,000 shall be awarded to the Sierra Madre, California Public

Library, $23,000 shall be awarded to the Brooklyn Public Library

in Brooklyn, New York, $46,000 shall be awarded to the New

York Public Library Staten Island branch, $266,000 shall be

awarded to the Edward H. Nabb Research Center at Salisbury

State University in Salisbury, Maryland, $461,000 shall be awarded

to Texas Tech University, $230,000 shall be awarded to the City

of Ontario, California Public Library, $461,000 shall be awarded

to the Southern Oregon University in Ashland, Oregon, $1,106,000

shall be awarded to Christopher Newport University in Newport

News, Virginia, $128,000 shall be awarded to the Nassau County

Museum of Art in Roslyn Harbor, New York, $850,000 shall be

awarded to the Children’s Museum of Los Angeles, $43,000 shall

be awarded to Sumter County Library in Sumter, South Carolina,

$298,000 shall be awarded to Columbia College Center for Black

Music Research in Chicago, Illinois, $723,000 shall be awarded

to Old Sturbridge Village in Sturbridge, Massachusetts, $723,000

shall be awarded to New Bedford Whaling Museum in Massachusetts, $298,000 shall be awarded to Mystic Seaport Museum of

America and the Sea in Connecticut, $468,000 shall be awarded

to the City of Houston Public Library, $128,000 shall be awarded

to the Roberson Museum and Science Center in Binghampton,

New York, $850,000 shall be awarded to Berman Museum of Art

at Ursinus College in Collegeville, Pennsylvania, $680,000 shall

be awarded to AMISTAD Research Center at Tulane University,

$2,125,000 shall be awarded to Silas Bronson Library in Waterbury,

Connecticut, $213,000 shall be awarded to Fitchburg Art Museum

in Fitchburg, Massachusetts, $128,000 shall be awarded to North

Carolina Museum of Life and Science, $2,435,000 shall be awarded

to New York Public Library, $85,000 shall be awarded to the

New York Botanical Garden in Bronx, New York, $170,000 shall

be awarded to George Eastman House in Rochester, New York,

$425,000 shall be awarded to The National Aviary in Pittsburgh,

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–65

Pennsylvania, $723,000 shall be awarded to the George C. Page

Museum in Los Angeles, California, $461,000 shall be awarded

to the Abraham Lincoln Bicentennial Commission, and $410,000

shall be awarded to the AE Seaman Mineral Museum in Houghton,

Michigan.

MEDICARE PAYMENT ADVISORY COMMISSION

SALARIES AND EXPENSES

For expenses necessary to carry out section 1805 of the Social

Security Act, $8,000,000, to be transferred to this appropriation

from the Federal Hospital Insurance and the Federal Supplementary Medical Insurance Trust Funds.

NATIONAL COMMISSION ON LIBRARIES AND INFORMATION SCIENCE

SALARIES AND EXPENSES

For necessary expenses for the National Commission on Libraries and Information Science, established by the Act of July 20,

1970 (Public Law 91–345, as amended), $1,495,000.

NATIONAL COUNCIL ON DISABILITY

SALARIES AND EXPENSES

For expenses necessary for the National Council on Disability

as authorized by title IV of the Rehabilitation Act of 1973, as

amended, $2,615,000.

NATIONAL EDUCATION GOALS PANEL

For expenses necessary for the National Education Goals Panel,

as authorized by title II, part A of the Goals 2000: Educate America

Act, $1,500,000.

NATIONAL LABOR RELATIONS BOARD

SALARIES AND EXPENSES

For expenses necessary for the National Labor Relations Board

to carry out the functions vested in it by the Labor-Management

Relations Act, 1947, as amended (29 U.S.C. 141–167), and other

laws, $216,438,000: Provided, That no part of this appropriation

shall be available to organize or assist in organizing agricultural

laborers or used in connection with investigations, hearings, directives, or orders concerning bargaining units composed of agricultural

laborers as referred to in section 2(3) of the Act of July 5, 1935

(29 U.S.C. 152), and as amended by the Labor-Management Relations Act, 1947, as amended, and as defined in section 3(f ) of

the Act of June 25, 1938 (29 U.S.C. 203), and including in said

definition employees engaged in the maintenance and operation

of ditches, canals, reservoirs, and waterways when maintained or

operated on a mutual, nonprofit basis and at least 95 percent

of the water stored or supplied thereby is used for farming purposes.

114 STAT. 2763A–66 PUBLIC LAW 106–554—APPENDIX A

NATIONAL MEDIATION BOARD

SALARIES AND EXPENSES

For expenses necessary to carry out the provisions of the Railway Labor Act, as amended (45 U.S.C. 151–188), including emergency boards appointed by the President, $10,400,000.

OCCUPATIONAL SAFETY AND HEALTH REVIEW COMMISSION

SALARIES AND EXPENSES

For expenses necessary for the Occupational Safety and Health

Review Commission (29 U.S.C. 661), $8,720,000.

RAILROAD RETIREMENT BOARD

DUAL BENEFITS PAYMENTS ACCOUNT

For payment to the Dual Benefits Payments Account, authorized under section 15(d) of the Railroad Retirement Act of 1974,

$160,000,000, which shall include amounts becoming available in

fiscal year 2001 pursuant to section 224(c)(1)(B) of Public Law

98–76; and in addition, an amount, not to exceed 2 percent of

the amount provided herein, shall be available proportional to the

amount by which the product of recipients and the average benefit

received exceeds $160,000,000: Provided, That the total amount

provided herein shall be credited in 12 approximately equal amounts

on the first day of each month in the fiscal year.

FEDERAL PAYMENTS TO THE RAILROAD RETIREMENT ACCOUNTS

For payment to the accounts established in the Treasury for

the payment of benefits under the Railroad Retirement Act for

interest earned on unnegotiated checks, $150,000, to remain available through September 30, 2002, which shall be the maximum

amount available for payment pursuant to section 417 of Public

Law 98–76.

LIMITATION ON ADMINISTRATION

For necessary expenses for the Railroad Retirement Board for

administration of the Railroad Retirement Act and the Railroad

Unemployment Insurance Act, $95,000,000, to be derived in such

amounts as determined by the Board from the railroad retirement

accounts and from moneys credited to the railroad unemployment

insurance administration fund.

LIMITATION ON THE OFFICE OF INSPECTOR GENERAL

For expenses necessary for the Office of Inspector General

for audit, investigatory and review activities, as authorized by the

Inspector General Act of 1978, as amended, not more than

$5,700,000, to be derived from the railroad retirement accounts

and railroad unemployment insurance account: Provided, That none

of the funds made available in any other paragraph of this Act

may be transferred to the Office; used to carry out any such transfer;

used to provide any office space, equipment, office supplies, communications facilities or services, maintenance services, or administrative services for the Office; used to pay any salary, benefit, or

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–67

award for any personnel of the Office; used to pay any other

operating expense of the Office; or used to reimburse the Office

for any service provided, or expense incurred, by the Office.

SOCIAL SECURITY ADMINISTRATION

PAYMENTS TO SOCIAL SECURITY TRUST FUNDS

For payment to the Federal Old-Age and Survivors Insurance

and the Federal Disability Insurance trust funds, as provided under

sections 201(m), 228(g), and 1131(b)(2) of the Social Security Act,

$20,400,000.

SPECIAL BENEFITS FOR DISABLED COAL MINERS

For carrying out title IV of the Federal Mine Safety and Health Act of 1977, $365,748,000, to remain available until expended.

For making, after July 31 of the current fiscal year, benefit

payments to individuals under title IV of the Federal Mine Safety

and Health Act of 1977, for costs incurred in the current fiscal

year, such amounts as may be necessary.

For making benefit payments under title IV of the Federal

Mine Safety and Health Act of 1977 for the first quarter of fiscal

year 2002, $114,000,000, to remain available until expended.

SUPPLEMENTAL SECURITY INCOME PROGRAM

For carrying out titles XI and XVI of the Social Security Act,

section 401 of Public Law 92–603, section 212 of Public Law 93– 66, as amended, and section 405 of Public Law 95–216, including

payment to the Social Security trust funds for administrative

expenses incurred pursuant to section 201(g)(1) of the Social Security Act, $23,043,000,000, to remain available until expended: Provided, That any portion of the funds provided to a State in the

current fiscal year and not obligated by the State during that

year shall be returned to the Treasury. In addition, $210,000,000, to remain available until September

30, 2002, for payment to the Social Security trust funds for administrative expenses for continuing disability reviews as authorized

by section 103 of Public Law 104–121 and section 10203 of Public

Law 105–33. The term ‘‘continuing disability reviews’’ means

reviews and redeterminations as defined under section 201(g)(1)(A)

of the Social Security Act, as amended.

For making, after June 15 of the current fiscal year, benefit

payments to individuals under title XVI of the Social Security

Act, for unanticipated costs incurred for the current fiscal year,

such sums as may be necessary.

For making benefit payments under title XVI of the Social

Security Act for the first quarter of fiscal year 2002,

$10,470,000,000, to remain available until expended.

LIMITATION ON ADMINISTRATIVE EXPENSES

For necessary expenses, including the hire of two passenger

motor vehicles, and not to exceed $10,000 for official reception

and representation expenses, not more than $6,583,000,000 may

be expended, as authorized by section 201(g)(1) of the Social Security Act, from any one or all of the trust funds referred to therein:

Provided, That not less than $1,800,000 shall be for the Social

114 STAT. 2763A–68 PUBLIC LAW 106–554—APPENDIX A

Security Advisory Board: Provided further, That unobligated balances at the end of fiscal year 2001 not needed for fiscal year

2001 shall remain available until expended to invest in the Social

Security Administration information technology and telecommunications hardware and software infrastructure, including related

equipment and non-payroll administrative expenses associated

solely with this information technology and telecommunications

infrastructure: Provided further, That reimbursement to the trust

funds under this heading for expenditures for official time for

employees of the Social Security Administration pursuant to section

7131 of title 5, United States Code, and for facilities or support

services for labor organizations pursuant to policies, regulations,

or procedures referred to in section 7135(b) of such title shall

be made by the Secretary of the Treasury, with interest, from

amounts in the general fund not otherwise appropriated, as soon

as possible after such expenditures are made.

From funds provided under the previous paragraph, notwithstanding the provision under this heading in Public Law 106– 113 regarding unobligated balances at the end of fiscal year 2000

not needed for such fiscal year, an amount not to exceed $50,000,000

from such unobligated balances shall, in addition to funding already

available under this heading for fiscal year 2001, be available

for necessary expenses.

From funds provided under the first paragraph, not less than $200,000,000 shall be available for conducting continuing disability

reviews.

In addition to funding already available under this heading,

and subject to the same terms and conditions, $450,000,000, to

remain available until September 30, 2002, for continuing disability

reviews as authorized by section 103 of Public Law 104–121 and

section 10203 of Public Law 105–33. The term ‘‘continuing disability

reviews’’ means reviews and redeterminations as defined under

section 201(g)(1)(A) of the Social Security Act, as amended. In addition, $91,000,000 to be derived from administration fees

in excess of $5.00 per supplementary payment collected pursuant

to section 1616(d) of the Social Security Act or section 212(b)(3)

of Public Law 93–66, which shall remain available until expended.

To the extent that the amounts collected pursuant to such section

1616(d) or 212(b)(3) in fiscal year 2001 exceed $91,000,000, the

amounts shall be available in fiscal year 2002 only to the extent

provided in advance in appropriations Acts.

From funds previously appropriated for this purpose, any

unobligated balances at the end of fiscal year 2000 shall be available

to continue Federal-State partnerships which will evaluate means

to promote Medicare buy-in programs targeted to elderly and disabled individuals under titles XVIII and XIX of the Social Security

Act.

From funds provided under the first paragraph, up to $6,000,000 shall be available for implementation, development,

evaluation, and other costs associated with administration of section

302 of the Ticket to Work and Work Incentives Improvement Act.

OFFICE OF INSPECTOR GENERAL

(INCLUDING TRANSFER OF FUNDS)

For expenses necessary for the Office of Inspector General

in carrying out the provisions of the Inspector General Act of

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–69

1978, as amended, $16,944,000, together with not to exceed

$52,500,000, to be transferred and expended as authorized by section 201(g)(1) of the Social Security Act from the Federal OldAge and Survivors Insurance Trust Fund and the Federal Disability

Insurance Trust Fund.

In addition, an amount not to exceed 3 percent of the total

provided in this appropriation may be transferred from the ‘‘Limitation on Administrative Expenses’’, Social Security Administration,

to be merged with this account, to be available for the time and

purposes for which this account is available: Provided, That notice

of such transfers shall be transmitted promptly to the Committees

on Appropriations of the House and Senate.

UNITED STATES INSTITUTE OF PEACE

OPERATING EXPENSES

For necessary expenses of the United States Institute of Peace

as authorized in the United States Institute of Peace Act,

$15,000,000.

TITLE V—GENERAL PROVISIONS

SEC. 501. The Secretaries of Labor, Health and Human Services, and Education are authorized to transfer unexpended balances

of prior appropriations to accounts corresponding to current appropriations provided in this Act: Provided, That such transferred

balances are used for the same purpose, and for the same periods

of time, for which they were originally appropriated.

SEC. 502. No part of any appropriation contained in this Act

shall remain available for obligation beyond the current fiscal year

unless expressly so provided herein.

SEC. 503. (a) No part of any appropriation contained in this

Act shall be used, other than for normal and recognized executivelegislative relationships, for publicity or propaganda purposes, for

the preparation, distribution, or use of any kit, pamphlet, booklet,

publication, radio, television, or video presentation designed to support or defeat legislation pending before the Congress or any State

legislature, except in presentation to the Congress or any State

legislature itself.

(b) No part of any appropriation contained in this Act shall

be used to pay the salary or expenses of any grant or contract

recipient, or agent acting for such recipient, related to any activity

designed to influence legislation or appropriations pending before

the Congress or any State legislature.

SEC. 504. The Secretaries of Labor and Education are authorized to make available not to exceed $20,000 and $15,000, respectively, from funds available for salaries and expenses under titles

I and III, respectively, for official reception and representation

expenses; the Director of the Federal Mediation and Conciliation

Service is authorized to make available for official reception and

representation expenses not to exceed $2,500 from the funds available for ‘‘Salaries and expenses, Federal Mediation and Conciliation

Service’’; and the Chairman of the National Mediation Board is

authorized to make available for official reception and representation expenses not to exceed $2,500 from funds available for ‘‘Salaries

and expenses, National Mediation Board’’.

114 STAT. 2763A–70 PUBLIC LAW 106–554—APPENDIX A

SEC. 505. Notwithstanding any other provision of this Act,

no funds appropriated under this Act shall be used to carry out

any program of distributing sterile needles or syringes for the

hypodermic injection of any illegal drug.

SEC. 506. (a) It is the sense of the Congress that, to the

greatest extent practicable, all equipment and products purchased

with funds made available in this Act should be American-made.

(b) In providing financial assistance to, or entering into any

contract with, any entity using funds made available in this Act,

the head of each Federal agency, to the greatest extent practicable,

shall provide to such entity a notice describing the statement made

in subsection (a) by the Congress.

(c) If it has been finally determined by a court or Federal

agency that any person intentionally affixed a label bearing a

‘‘Made in America’’ inscription, or any inscription with the same

meaning, to any product sold in or shipped to the United States

that is not made in the United States, the person shall be ineligible

to receive any contract or subcontract made with funds made available in this Act, pursuant to the debarment, suspension, and ineligibility procedures described in sections 9.400 through 9.409 of

title 48, Code of Federal Regulations.

SEC. 507. When issuing statements, press releases, requests

for proposals, bid solicitations and other documents describing

projects or programs funded in whole or in part with Federal

money, all grantees receiving Federal funds included in this Act,

including but not limited to State and local governments and recipients of Federal research grants, shall clearly state: (1) the percentage of the total costs of the program or project which will be

financed with Federal money; (2) the dollar amount of Federal

funds for the project or program; and (3) percentage and dollar

amount of the total costs of the project or program that will be

financed by non-governmental sources.

SEC. 508. (a) None of the funds appropriated under this Act,

and none of the funds in any trust fund to which funds are appropriated under this Act, shall be expended for any abortion.

(b) None of the funds appropriated under this Act, and none

of the funds in any trust fund to which funds are appropriated

under this Act, shall be expended for health benefits coverage

that includes coverage of abortion.

(c) The term ‘‘health benefits coverage’’ means the package

of services covered by a managed care provider or organization

pursuant to a contract or other arrangement.

SEC. 509. (a) The limitations established in the preceding section shall not apply to an abortion—

(1) if the pregnancy is the result of an act of rape or

incest; or

(2) in the case where a woman suffers from a physical

disorder, physical injury, or physical illness, including a lifeendangering physical condition caused by or arising from the

pregnancy itself, that would, as certified by a physician, place

the woman in danger of death unless an abortion is performed.

(b) Nothing in the preceding section shall be construed as

prohibiting the expenditure by a State, locality, entity, or private

person of State, local, or private funds (other than a State’s or

locality’s contribution of Medicaid matching funds).

(c) Nothing in the preceding section shall be construed as

restricting the ability of any managed care provider from offering

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–71

abortion coverage or the ability of a State or locality to contract

separately with such a provider for such coverage with State funds

(other than a State’s or locality’s contribution of Medicaid matching

funds).

SEC. 510. (a) None of the funds made available in this Act

may be used for—

(1) the creation of a human embryo or embryos for research

purposes; or

(2) research in which a human embryo or embryos are

destroyed, discarded, or knowingly subjected to risk of injury

or death greater than that allowed for research on fetuses

in utero under 45 CFR 46.208(a)(2) and section 498(b) of the

Public Health Service Act (42 U.S.C. 289g(b)).

(b) For purposes of this section, the term ‘‘human embryo

or embryos’’ includes any organism, not protected as a human

subject under 45 CFR 46 as of the date of the enactment of this

Act, that is derived by fertilization, parthenogenesis, cloning, or

any other means from one or more human gametes or human

diploid cells.

SEC. 511. (a) None of the funds made available in this Act

may be used for any activity that promotes the legalization of

any drug or other substance included in schedule I of the schedules

of controlled substances established by section 202 of the Controlled

Substances Act (21 U.S.C. 812).

(b) The limitation in subsection (a) shall not apply when there

is significant medical evidence of a therapeutic advantage to the

use of such drug or other substance or that federally sponsored

clinical trials are being conducted to determine therapeutic advantage.

SEC. 512. None of the funds made available in this Act may

be obligated or expended to enter into or renew a contract with

an entity if—

(1) such entity is otherwise a contractor with the United

States and is subject to the requirement in section 4212(d)

of title 38, United States Code, regarding submission of an

annual report to the Secretary of Labor concerning employment

of certain veterans; and

(2) such entity has not submitted a report as required

by that section for the most recent year for which such requirement was applicable to such entity.

SEC. 513. (a) Section 403(a)(5)(H)(iii) of the Social Security

Act (42 U.S.C. 603(a)(5)(H)(iii)) is amended by striking ‘‘2001’’ and

inserting ‘‘2005’’.

(b) Section 403(a)(5)(H) of such Act (42 U.S.C. 603(a)(5)(G))

is amended by adding at the end the following:

‘‘(iv) INTERIM REPORT.—Not later than January 1,

2002, the Secretary shall submit to the Congress an

interim report on the evaluations referred to in clause

(i).’’.

SEC. 514. None of the funds made available in this Act may

be used to promulgate or adopt any final standard under section

1173(b) of the Social Security Act (42 U.S.C. 1320d–2(b)) providing

for, or providing for the assignment of, a unique health identifier

for an individual (except in an individual’s capacity as an employer

or a health care provider), until legislation is enacted specifically

approving the standard.

114 STAT. 2763A–72 PUBLIC LAW 106–554—APPENDIX A

SEC. 515. Section 410(b) of The Ticket to Work and Work

Incentives Improvement Act of 1999 (Public Law 106–170) is amended by striking ‘‘2009’’ both places it appears and inserting ‘‘2001’’.

SEC. 516. (a) HUMAN PAPILLOMAVIRUS.—Part B of title III of

the Public Health Services Act (42 U.S.C. 243 et seq.) is amended

by inserting before section 318 the following section:

‘‘HUMAN PAPILLOMAVIRUS

‘‘SEC. 317P. (a) SURVEILLANCE.—

‘‘(1) IN GENERAL.—The Secretary, acting through the Centers for Disease Control and Prevention, shall—

‘‘(A) enter into cooperative agreements with States and

other entities to conduct sentinel surveillance or other special studies that would determine the prevalence in various

age groups and populations of specific types of human

papillomavirus (referred to in this section as ‘HPV’) in

different sites in various regions of the United States,

through collection of special specimens for HPV using a

variety of laboratory-based testing and diagnostic tools;

and

‘‘(B) develop and analyze data from the HPV sentinel

surveillance system described in subparagraph (A).

‘‘(2) REPORT.—The Secretary shall make a progress report

to the Congress with respect to paragraph (1) no later than

1 year after the effective date of this section.

‘‘(b) PREVENTION ACTIVITIES; EDUCATION PROGRAM.—

‘‘(1) IN GENERAL.—The Secretary, acting through the Centers for Disease Control and Prevention, shall conduct prevention research on HPV, including—

‘‘(A) behavioral and other research on the impact of

HPV-related diagnosis on individuals;

‘‘(B) formative research to assist with the development

of educational messages and information for the public,

for patients, and for their partners about HPV;

‘‘(C) surveys of physician and public knowledge, attitudes, and practices about genital HPV infection; and

‘‘(D) upon the completion of and based on the findings

under subparagraphs (A) through (C), develop and disseminate educational materials for the public and health care

providers regarding HPV and its impact and prevention.

‘‘(2) REPORT; FINAL PROPOSAL.—The Secretary shall make

a progress report to the Congress with respect to paragraph

(1) not later than 1 year after the effective date of this section,

and shall develop a final report not later than 3 years after

such effective date, including a detailed summary of the significant findings and problems and the best strategies to prevent

future infections, based on available science.

‘‘(c) HPV EDUCATION AND PREVENTION.—

‘‘(1) IN GENERAL.—The Secretary shall prepare and distribute educational materials for health care providers and the

public that include information on HPV. Such materials shall

address—

‘‘(A) modes of transmission;

‘‘(B) consequences of infection, including the link

between HPV and cervical cancer;

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–73

‘‘(C) the available scientific evidence on the effectiveness or lack of effectiveness of condoms in preventing infection with HPV; and

‘‘(D) the importance of regular Pap smears, and other

diagnostics for early intervention and prevention of cervical

cancer purposes in preventing cervical cancer.

‘‘(2) MEDICALLY ACCURATE INFORMATION.—Educational

material under paragraph (1), and all other relevant educational and prevention materials prepared and printed from

this date forward for the public and health care providers

by the Secretary (including materials prepared through the

Food and Drug Administration, the Centers for Disease Control

and Prevention, and the Health Resources and Services

Administration), or by contractors, grantees, or subgrantees

thereof, that are specifically designed to address STDs including

HPV shall contain medically accurate information regarding

the effectiveness or lack of effectiveness of condoms in preventing the STD the materials are designed to address. Such

requirement only applies to materials mass produced for the

public and health care providers, and not to routine communications.’’.

(b) LABELING OF CONDOMS.—The Secretary of Health and

Human Services shall reexamine existing condom labels that are

authorized pursuant to the Federal Food, Drug, and Cosmetic Act

to determine whether the labels are medically accurate regarding

the overall effectiveness or lack of effectiveness of condoms in

preventing sexually transmitted diseases, including HPV.

SEC. 517. Section 403(o) of the Food, Drug, and Cosmetic Act

(21 U.S.C. 343(o)) is repealed. Subsections (c) and (d) of section

4 of the Saccharin Study and Labeling Act are repealed.

SEC. 518. (a) Title VIII of the Social Security Act is amended

by inserting after section 810 (42 U.S.C. 1010) the following new

section:

‘‘SEC. 810A. OPTIONAL FEDERAL ADMINISTRATION OF STATE RECOGNITION PAYMENTS.

‘‘(a) IN GENERAL.—The Commissioner of Social Security may

enter into an agreement with any State (or political subdivision

thereof ) that provides cash payments on a regular basis to individuals entitled to benefits under this title under which the Commissioner of Social Security shall make such payments on behalf of

such State (or subdivision).

‘‘(b) AGREEMENT TERMS.—

‘‘(1) IN GENERAL.—Such agreement shall include such terms

as the Commissioner of Social Security finds necessary to

achieve efficient and effective administration of both this title

and the State program.

‘‘(2) FINANCIAL TERMS.—Such agreement shall provide for

the State to pay the Commissioner of Social Security, at such

times and in such installments as the parties may specify—

‘‘(A) an amount equal to the expenditures made by

the Commissioner of Social Security pursuant to such

agreement as payments to individuals on behalf of such

State; and

114 STAT. 2763A–74 PUBLIC LAW 106–554—APPENDIX A

‘‘(B) an administration fee to reimburse the administrative expenses incurred by the Commissioner of Social Security in making payments to individuals on behalf of the

State.

‘‘(c) SPECIAL DISPOSITION OF ADMINISTRATION FEES.—Administration fees, upon collection, shall be credited to a special fund

established in the Treasury of the United States for State recognition payments for certain World War II veterans. The amounts

so credited, to the extent and in the amounts provided in advance

in appropriations Acts, shall be available to defray expenses

incurred in carrying out this title.’’. (b) CONFORMING AMENDMENTS.— (1) The table of contents of title VIII of the Social Security

Act is amended by inserting after

‘‘Sec. 810. Other administrative provisions.’’

the following:

‘‘Sec. 810A. Optional Federal administration of State recognition payments.’’.

(2) Section 1129A(e) of the Social Security Act (42 U.S.C.

1320a–8a(e)) is amended—

(A) by inserting ‘‘VIII or’’ after ‘‘benefits under’’;

(B) by inserting ‘‘810A or’’ after ‘‘agreement under section’’;

(C) by inserting ‘‘1010A or’’ before ‘‘1382(e)(a)’’; and

(D) by inserting ‘‘, as the case may be’’ immediately

before the period.

SEC. 519. Section 1612(a)(1) of the Social Security Act (42

U.S.C. 1382(a) is amended—

(1) in subparagraph (A), by inserting ‘‘but without the

application of section 210( j)(3)’’ immediately before the semicolon; and

(2) in subparagraph (B), by—

(A) striking ‘‘and the last’’ and inserting ‘‘the last’’;

and

(B) inserting ‘‘, and section 210( j)(3)’’ after ‘‘subsection

(a)’’.

SEC. 520. Amounts made available under this Act for the

administrative and related expenses for departmental management

for the Department of Labor, the Department of Health and Human

Services, and the Department of Education shall be reduced on

a pro rata basis by $25,000,000: Provided, That this provision

shall not apply to the Food and Drug Administration and the

Indian Health Service.

TITLE VI—ASSETS FOR INDEPENDENCE

SEC. 601. SHORT TITLE.

This title may be cited as the ‘‘Assets for Independence Act

Amendments of 2000’’.

SEC. 602. MATCHING CONTRIBUTIONS UNAVAILABLE FOR EMERGENCY

WITHDRAWALS.

Section 404(5)(A)(v) of the Assets for Independence Act (42

U.S.C. 604 note) is amended by striking ‘‘, or enabling the eligible

individual to make an emergency withdrawal’’.

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–75

SEC. 603. ADDITIONAL QUALIFIED ENTITIES.

Section 404(7)(A) of the Assets for Independence Act (42 U.S.C.

604 note) is amended— (1) in clause (i), by striking ‘‘or’’ at the end thereof;

(2) in clause (ii), by striking the period at the end and

inserting ‘‘; or’’; and

(3) by adding at the end the following new clause: ‘‘(iii) an entity that— ‘‘(I) is—

‘‘(aa) a credit union designated as a lowincome credit union by the National Credit

Union Administration (NCUA); or

‘‘(bb) an organization designated as a

community development financial institution

by the Secretary of the Treasury (or the

Community Development Financial Institutions Fund); and

‘‘(II) can demonstrate a collaborative relationship with a local community-based organization

whose activities are designed to address poverty

in the community and the needs of community

members for economic independence and stability.’’.

SEC. 604. HOME PURCHASE COSTS.

Section 404(8)(B)(i) of the Assets for Independence Act (42

U.S.C. 604 note) is amended by striking ‘‘100’’ and inserting ‘‘120’’.

SEC. 605. INCREASED SET-ASIDE FOR ECONOMIC LITERACY TRAINING

AND ADMINISTRATIVE COSTS.

Section 407(c)(3) of the Assets for Independence Act (42 U.S.C.

604 note) is amended—

(1) by striking ‘‘9.5’’ and inserting ‘‘15’’; and

(2) by inserting after the first sentence the following: ‘‘Of

the total amount specified in this paragraph, not more than

7.5 percent shall be used for administrative functions under

paragraph (1)(C), including program management, reporting

requirements, recruitment and enrollment of individuals, and

monitoring. The remainder of the total amount specified in

this paragraph (not including the amount specified for use

for the purposes described in paragraph (1)(D)) shall be used

for nonadministrative functions described in paragraph (1)(A),

including case management, budgeting, economic literacy, and

credit counseling. If the cost of nonadministrative functions

described in paragraph (1)(A) is less than 5.5 percent of the

total amount specified in this paragraph, such excess funds

may be used for administrative functions.’’.

SEC. 606. ALTERNATIVE ELIGIBILITY CRITERIA.

Section 408(a)(1) of the Assets for Independence Act (42 U.S.C.

604 note) is amended by striking ‘‘does not exceed’’ and inserting

‘‘is equal to or less than 200 percent of the poverty line (as determined by the Office of Management and Budget) or’’.

SEC. 607. REVISED ANNUAL PROGRESS REPORT DEADLINE.

(a) IN GENERAL.—Section 412(c) of the Assets for Independence

Act (42 U.S.C. 604 note) is amended by striking ‘‘calendar’’ and

inserting ‘‘project’’.

114 STAT. 2763A–76 PUBLIC LAW 106–554—APPENDIX A

(b) TRANSITIONAL DEADLINE.—Notwithstanding the amendment

made by subsection (a), the submission of the initial report of

a qualified entity under section 412(c) shall not be required prior

to the date that is 90 days after the date of enactment of this

title.

SEC. 608. REVISED INTERIM EVALUATION REPORT DEADLINE.

(a) IN GENERAL.—Section 414(d)(1) of the Assets for Independence Act (42 U.S.C. 604 note) is amended by striking ‘‘calendar’’ and inserting ‘‘project’’. (b) TRANSITIONAL DEADLINE.—Notwithstanding the amendment

made by subsection (a), the submission of the initial interim report

of the Secretary under section 412(c) shall not be required prior

to the date that is 90 days after the date of enactment of this

title.

SEC. 609. INCREASED APPROPRIATIONS FOR EVALUATION EXPENSES.

Subsection (e) of section 414 of the Assets for Independence

Act (42 U.S.C. 604 note) is amended to read as follows:

‘‘(e) EVALUATION EXPENSES.—Of the amount appropriated

under section 416 for a fiscal year, the Secretary may expend

not more than $500,000 for such fiscal year to carry out the objectives of this section.’’.

SEC. 610. NO REDUCTION IN BENEFITS.

Section 415 of the Assets for Independence Act (42 U.S.C.

604 note) is amended to read as follows:

‘‘SEC. 415. NO REDUCTION IN BENEFITS.

‘‘Notwithstanding any other provision of Federal law (other

than the Internal Revenue Code of 1986) that requires consideration

of one or more financial circumstances of an individual, for the

purpose of determining eligibility to receive, or the amount of,

any assistance or benefit authorized by such law to be provided

to or for the benefit of such individual, funds (including interest

accruing) in an individual development account under this Act

shall be disregarded for such purpose with respect to any period

during which such individual maintains or makes contributions

into such an account.’’.

TITLE VII—PHYSICAL EDUCATION FOR PROGRESS ACT

SEC. 701. PHYSICAL EDUCATION FOR PROGRESS. Title X of the

Elementary and Secondary Education Act of 1965 (20 U.S.C. 8001

et seq.) is amended by adding at the end the following:

‘‘PART L—PHYSICAL EDUCATION FOR

PROGRESS

‘‘SEC. 10999A. SHORT TITLE.

‘‘This part may be cited as the ‘Physical Education for Progress

Act’.

‘‘SEC. 10999B. PURPOSE.

‘‘The purpose of this part is to award grants and contracts

to local educational agencies to enable the local educational agencies

to initiate, expand and improve physical education programs for

all kindergarten through 12th grade students.

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–77

‘‘SEC. 10999C. FINDINGS.

‘‘Congress makes the following findings:

‘‘(1) Physical education is essential to the development

of growing children.

‘‘(2) Physical education helps improve the overall health

of children by improving their cardiovascular endurance, muscular strength and power, and flexibility, and by enhancing

weight regulation, bone development, posture, skillful moving,

active lifestyle habits, and constructive use of leisure time.

‘‘(3) Physical education helps improve the self esteem, interpersonal relationships, responsible behavior, and independence

of children.

‘‘(4) Children who participate in high quality daily physical

education programs tend to be more healthy and physically

fit.

‘‘(5) The percentage of young people who are overweight

has more than doubled in the 30 years preceding 1999.

‘‘(6) Low levels of activity contribute to the high prevalence

of obesity among children in the United States.

‘‘(7) Obesity related diseases cost the United States economy more than $100,000,000,000 every year.

‘‘(8) Inactivity and poor diet cause at least 300,000 deaths

a year in the United States.

‘‘(9) Physically fit adults have significantly reduced risk

factors for heart attacks and stroke.

‘‘(10) Children are not as active as they should be and

fewer than one in four children get 20 minutes of vigorous

activity every day of the week.

‘‘(11) The Surgeon General’s 1996 Report on Physical Activity and Health, and the Centers for Disease Control and Prevention, recommend daily physical education for all students in

kindergarten through grade 12.

‘‘(12) Twelve years after Congress passed House Concurrent

Resolution 97, 100th Congress, agreed to December 11, 1987,

encouraging State and local governments and local educational

agencies to provide high quality daily physical education programs for all children in kindergarten through grade 12, little

progress has been made.

‘‘(13) Every student in our Nation’s schools, from kindergarten through grade 12, should have the opportunity to participate in quality physical education. It is the unique role of

quality physical education programs to develop the healthrelated fitness, physical competence, and cognitive understanding about physical activity for all students so that the students

can adopt healthy and physically active lifestyles.

‘‘SEC. 10999D. PROGRAM AUTHORIZED.

‘‘The Secretary is authorized to award grants to, and enter

into contracts with, local educational agencies to pay the Federal

share of the costs of initiating, expanding, and improving physical

education programs for kindergarten through grade 12 students

by—

‘‘(1) providing equipment and support to enable students

to actively participate in physical education activities; and

‘‘(2) providing funds for staff and teacher training and

education.

114 STAT. 2763A–78 PUBLIC LAW 106–554—APPENDIX A

‘‘SEC. 10999E. APPLICATIONS; PROGRAM ELEMENTS.

‘‘(a) APPLICATIONS.—Each local educational agency desiring a

grant or contract under this part shall submit to the Secretary

an application that contains a plan to initiate, expand, or improve

physical education programs in the schools served by the agency

in order to make progress toward meeting State standards for

physical education. ‘‘(b) PROGRAM ELEMENTS.—A physical education program

described in any application submitted under subsection (a) may

provide—

‘‘(1) fitness education and assessment to help children

understand, improve, or maintain their physical well-being;

‘‘(2) instruction in a variety of motor skills and physical

activities designed to enhance the physical, mental, and social

or emotional development of every child;

‘‘(3) development of cognitive concepts about motor skill

and physical fitness that support a lifelong healthy lifestyle;

‘‘(4) opportunities to develop positive social and cooperative

skills through physical activity participation;

‘‘(5) instruction in healthy eating habits and good nutrition;

and

‘‘(6) teachers of physical education the opportunity for

professional development to stay abreast of the latest research,

issues, and trends in the field of physical education.

‘‘(c) SPECIAL RULE.—For the purpose of this part, extracurricular activities such as team sports and Reserve Officers’ Training Corps (ROTC) program activities shall not be considered as

part of the curriculum of a physical education program assisted

under this part.

‘‘SEC. 10999F. PROPORTIONALITY.

‘‘The Secretary shall ensure that grants awarded and contracts

entered into under this part shall be equitably distributed between

local educational agencies serving urban and rural areas, and

between local educational agencies serving large and small numbers

of students.

‘‘SEC. 10999G. PRIVATE SCHOOL STUDENTS AND HOME-SCHOOLED STUDENTS.

‘‘An application for funds under this part may provide for

the participation, in the activities funded under this part, of—

‘‘(1) home-schooled children, and their parents and teachers; or

‘‘(2) children enrolled in private nonprofit elementary

schools or secondary schools, and their parents and teachers.

‘‘SEC. 10999H. REPORT REQUIRED FOR CONTINUED FUNDING.

‘‘As a condition to continue to receive grant or contract funding

after the first year of a multiyear grant or contract under this

part, the administrator of the grant or contract for the local educational agency shall submit to the Secretary an annual report

that describes the activities conducted during the preceding year

and demonstrates that progress has been made toward meeting

State standards for physical education.

‘‘SEC. 10999I. REPORT TO CONGRESS.

‘‘The Secretary shall submit a report to Congress not later

than June 1, 2003, that describes the programs assisted under

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–79

this part, documents the success of such programs in improving

physical fitness, and makes such recommendations as the Secretary

determines appropriate for the continuation and improvement of

the programs assisted under this part.

‘‘SEC. 10999J. ADMINISTRATIVE COSTS.

‘‘Not more than 5 percent of the grant or contract funds made

available to a local educational agency under this part for any

fiscal year may be used for administrative costs.

‘‘SEC. 10999K. FEDERAL SHARE; SUPPLEMENT NOT SUPPLANT.

‘‘(a) FEDERAL SHARE.—The Federal share under this part may

not exceed—

‘‘(1) 90 percent of the total cost of a project for the first

year for which the project receives assistance under this part;

and ‘‘(2) 75 percent of such cost for the second and each subsequent such year.

‘‘(b) SUPPLEMENT NOT SUPPLANT.—Funds made available under

this part shall be used to supplement and not supplant other

Federal, State and local funds available for physical education

activities.

‘‘SEC. 10999L. AUTHORIZATION OF APPROPRIATIONS.

‘‘There are authorized to be appropriated $30,000,000 for fiscal year 2001, $70,000,000 for fiscal year 2002, and $100,000,000 for

each of the fiscal years 2003 through 2005, to carry out this part.

Such funds shall remain available until expended.’’.

TITLE VIII—EARLY LEARNING OPPORTUNITIES

SEC. 801. SHORT TITLE; FINDINGS.

(a) SHORT TITLE.—This title may be cited as the ‘‘Early Learning Opportunities Act’’.

(b) FINDINGS.—Congress finds that—

(1) medical research demonstrates that adequate stimulation of a young child’s brain between birth and age 5 is critical

to the physical development of the young child’s brain;

(2) parents are the most significant and effective teachers

of their children, and they alone are responsible for choosing

the best early learning opportunities for their child;

(3) parent education and parent involvement are critical

to the success of any early learning program or activity;

(4) the more intensively parents are involved in their child’s

early learning, the greater the cognitive and noncognitive benefits to their children;

(5) many parents have difficulty finding the information

and support the parents seek to help their children grow to

their full potential;

(6) each day approximately 13,000,000 young children,

including 6,000,000 infants or toddlers, spend some or all of

their day being cared for by someone other than their parents;

(7) quality early learning programs, including those

designed to promote effective parenting, can increase the literacy rate, the secondary school graduation rate, the employment rate, and the college enrollment rate for children who

have participated in voluntary early learning programs and

activities;

114 STAT. 2763A–80 PUBLIC LAW 106–554—APPENDIX A

(8) early childhood interventions can yield substantial

advantages to participants in terms of emotional and cognitive

development, education, economic well-being, and health, with

the latter two advantages applying to the children’s families

as well;

(9) participation in quality early learning programs, including those designed to promote effective parenting, can decrease

the future incidence of teenage pregnancy, welfare dependency,

at-risk behaviors, and juvenile delinquency for children;

(10) several cost-benefit analysis studies indicate that for

each $1 invested in quality early learning programs, the Federal

Government can save over $5 by reducing the number of children and families who participate in Federal Government programs like special education and welfare;

(11) for children placed in the care of others during the

workday, the low salaries paid to the child care staff, the

lack of career progression for the staff, and the lack of child

development specialists involved in early learning and child

care programs, make it difficult to attract and retain the quality

of staff necessary for a positive early learning experience;

(12) Federal Government support for early learning has

primarily focused on out-of-home care programs like those

established under the Head Start Act, the Child Care and

Development Block Grant of 1990, and part C of the Individuals

with Disabilities Education Act, and these programs—

(A) serve far fewer than half of all eligible children;

(B) are not primarily designed to provide support for

parents who care for their young children in the home;

and

(C) lack a means of coordinating early learning

opportunities in each community; and

(13) by helping communities increase, expand, and better

coordinate early learning opportunities for children and their

families, the productivity and creativity of future generations

will be improved, and the Nation will be prepared for continued

leadership in the 21st century.

SEC. 802. PURPOSES.

The purposes of this title are—

(1) to increase the availability of voluntary programs, services, and activities that support early childhood development,

increase parent effectiveness, and promote the learning readiness of young children so that young children enter school

ready to learn;

(2) to support parents, child care providers, and caregivers

who want to incorporate early learning activities into the daily

lives of young children;

(3) to remove barriers to the provision of an accessible

system of early childhood learning programs in communities

throughout the United States;

(4) to increase the availability and affordability of professional development activities and compensation for caregivers

and child care providers; and

(5) to facilitate the development of community-based systems of collaborative service delivery models characterized by

resource sharing, linkages between appropriate supports, and

local planning for services.

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–81

SEC. 803. DEFINITIONS.

In this title:

(1) CAREGIVER.—The term ‘‘caregiver’’ means an individual,

including a relative, neighbor, or family friend, who regularly

or frequently provides care, with or without compensation, for

a child for whom the individual is not the parent.

(2) CHILD CARE PROVIDER.—The term ‘‘child care provider’’

means a provider of non-residential child care services (including center-based, family-based, and in-home child care services)

for compensation who or that is legally operating under State

law, and complies with applicable State and local requirements

for the provision of child care services.

(3) EARLY LEARNING.—The term ‘‘early learning’’, used with

respect to a program or activity, means learning designed to

facilitate the development of cognitive, language, motor, and

social-emotional skills for, and to promote learning readiness

in, young children.

(4) EARLY LEARNING PROGRAM.—The term ‘‘early learning

program’’ means—

(A) a program of services or activities that helps parents, caregivers, and child care providers incorporate early

learning into the daily lives of young children; or

(B) a program that directly provides early learning

to young children.

(5) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has the meaning

given the term in section 4 of the Indian Self-Determination

and Education Assistance Act (25 U.S.C. 450b).

(6) LOCAL COUNCIL.—The term ‘‘Local Council’’ means a

Local Council established or designated under section 814(a)

that serves one or more localities.

(7) LOCALITY.—The term ‘‘locality’’ means a city, county,

borough, township, or area served by another general purpose

unit of local government, an Indian tribe, a Regional Corporation, or a Native Hawaiian entity.

(8) PARENT.—The term ‘‘parent’’ means a biological parent,

an adoptive parent, a stepparent, a foster parent, or a legal

guardian of, or a person standing in loco parentis to, a child.

(9) POVERTY LINE.—The term ‘‘poverty line’’ means the

poverty line (as defined by the Office of Management and

Budget, and revised annually in accordance with section 673(2)

of the Community Services Block Grant Act (42 U.S.C. 9902(2)))

applicable to a family of the size involved.

(10) REGIONAL CORPORATION.—The term ‘‘Regional Corporation’’ means an entity listed in section 419(4)(B) of the

Social Security Act (42 U.S.C. 619(4)(B)).

(11) SECRETARY.—The term ‘‘Secretary’’ means the Secretary of Health and Human Services.

(12) STATE.—The term ‘‘State’’ means each of the several

States of the United States, the District of Columbia, and

the Commonwealth of Puerto Rico.

(13) TRAINING.—The term ‘‘training’’ means instruction in

early learning that—

(A) is required for certification under State and local

laws, regulations, and policies;

(B) is required to receive a nationally or State recognized credential or its equivalent;

114 STAT. 2763A–82 PUBLIC LAW 106–554—APPENDIX A

(C) is received in a postsecondary education program

focused on early learning or early childhood development

in which the individual is enrolled; or

(D) is provided, certified, or sponsored by an organization that is recognized for its expertise in promoting early

learning or early childhood development.

(14) YOUNG CHILD.—The term ‘‘young child’’ means any

child from birth to the age of mandatory school attendance

in the State where the child resides.

SEC. 804. PROHIBITIONS.

(a) PARTICIPATION NOT REQUIRED.—No person, including a parent, shall be required to participate in any program of early childhood education, early learning, parent education, or developmental

screening pursuant to the provisions of this title.

(b) RIGHTS OF PARENTS.—Nothing in this title shall be construed to affect the rights of parents otherwise established in Federal, State, or local law.

(c) PARTICULAR METHODS OR SETTINGS.—No entity that receives

funds under this title shall be required to provide services under

this title through a particular instructional method or in a particular instructional setting to comply with this title.

(d) NONDUPLICATION.—No funds provided under this title shall

be used to carry out an activity funded under another provision

of law providing for Federal child care or early learning programs,

unless an expansion of such activity is identified in the local needs

assessment and performance goals under this title.

SEC. 805. AUTHORIZATION AND APPROPRIATION OF FUNDS.

There are authorized to be appropriated to the Department

of Health and Human Services to carry out this title—

(1) $750,000,000 for fiscal year 2001;

(2) $1,000,000,000 for fiscal year 2002;

(3) $1,500,000,000 for fiscal year 2003; and

(4) such sums as may be necessary for each of the fiscal

years 2004 and 2005.

SEC. 806. COORDINATION OF FEDERAL PROGRAMS.

(a) COORDINATION.—The Secretary and the Secretary of Education shall develop mechanisms to resolve administrative and programmatic conflicts between Federal programs that would be a

barrier to parents, caregivers, service providers, or children related

to the coordination of services and funding for early learning programs.

(b) USE OF EQUIPMENT AND SUPPLIES.—In the case of a collaborative activity funded under this title and another provision of

law providing for Federal child care or early learning programs,

the use of equipment and nonconsumable supplies purchased with

funds made available under this title or such provision shall not

be restricted to children enrolled or otherwise participating in the

program carried out under this title or such provision, during a

period in which the activity is predominately funded under this

title or such provision.

SEC. 807. PROGRAM AUTHORIZED.

(a) GRANTS.—From amounts appropriated under section 805

the Secretary shall award grants to States to enable the States

to award grants to Local Councils to pay the Federal share of

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–83

the cost of carrying out early learning programs in the locality

served by the Local Council.

(b) FEDERAL SHARE.—

(1) IN GENERAL.—The Federal share of the cost described

in subsections (a) and (e) shall be 85 percent for the first

and second years of the grant, 80 percent for the third and

fourth years of the grant, and 75 percent for the fifth and

subsequent years of the grant.

(2) NON-FEDERAL SHARE.—The non-Federal share of the

cost described in subsections (a) and (e) may be contributed

in cash or in kind, fairly evaluated, including facilities, equipment, or services, which may be provided from State or local

public sources, or through donations from private entities. For

the purposes of this paragraph the term ‘‘facilities’’ includes

the use of facilities, but the term ‘‘equipment’’ means donated

equipment and not the use of equipment.

(c) MAINTENANCE OF EFFORT.—The Secretary shall not award

a grant under this title to any State unless the Secretary first

determines that the total expenditures by the State and its political

subdivisions to support early learning programs (other than funds

used to pay the non-Federal share under subsection (b)(2)) for

the fiscal year for which the determination is made is equal to

or greater than such expenditures for the preceding fiscal year.

(d) SUPPLEMENT NOT SUPPLANT.—Amounts received under this

title shall be used to supplement and not supplant other Federal,

State, and local public funds expended to promote early learning.

(e) SPECIAL RULE.—If funds appropriated to carry out this

title are less than $150,000,000 for any fiscal year, the Secretary

shall award grants for the fiscal year directly to Local Councils,

on a competitive basis, to pay the Federal share of the cost of

carrying out early learning programs in the locality served by

the Local Council. In carrying out the preceding sentence—

(1) subsection (c), subsections (b) and (c) of section 810,

and paragraphs (1), (2), and (3) of section 811(a) shall not

apply;

(2) State responsibilities described in section 811(d) shall

be carried out by the Local Council with regard to the locality;

(3) the Secretary shall provide such technical assistance

and monitoring as necessary to ensure that the use of the

funds by Local Councils and the distribution of the funds to

Local Councils are consistent with this title; and

(4) subject to paragraph (1), the Secretary shall assume

the responsibilities of the Lead State Agency under this title,

as appropriate.

SEC. 808. USES OF FUNDS.

(a) IN GENERAL.—Subject to section 810, grant funds under

this title shall be used to pay for developing, operating, or enhancing

voluntary early learning programs that are likely to produce sustained gains in early learning.

(b) LIMITED USES.—Subject to section 810, Lead State Agencies

and Local Councils shall ensure that funds made available under

this title to the agencies and Local Councils are used for three

or more of the following activities:

(1) Helping parents, caregivers, child care providers, and

educators increase their capacity to facilitate the development

of cognitive, language comprehension, expressive language,

114 STAT. 2763A–84 PUBLIC LAW 106–554—APPENDIX A

social-emotional, and motor skills, and promote learning readiness.

(2) Promoting effective parenting.

(3) Enhancing early childhood literacy.

(4) Developing linkages among early learning programs

within a community and between early learning programs and

health care services for young children.

(5) Increasing access to early learning opportunities for

young children with special needs, including developmental

delays, by facilitating coordination with other programs serving

such young children.

(6) Increasing access to existing early learning programs

by expanding the days or times that the young children are

served, by expanding the number of young children served,

or by improving the affordability of the programs for lowincome families.

(7) Improving the quality of early learning programs

through professional development and training activities,

increased compensation, and recruitment and retention incentives, for early learning providers.

(8) Removing ancillary barriers to early learning, including

transportation difficulties and absence of programs during nontraditional work times.

(c) REQUIREMENTS.—Each Lead State Agency designated under

section 810(c) and Local Councils receiving a grant under this

title shall ensure—

(1) that Local Councils described in section 814 work with

local educational agencies to identify cognitive, social, emotional, and motor developmental abilities which are necessary

to support children’s readiness for school;

(2) that the programs, services, and activities assisted

under this title will represent developmentally appropriate

steps toward the acquisition of those abilities; and

(3) that the programs, services, and activities assisted

under this title collectively provide benefits for children cared

for in their own homes as well as children placed in the care

of others.

(d) SLIDING SCALE PAYMENTS.—States and Local Councils

receiving assistance under this title shall ensure that programs,

services, and activities assisted under this title which customarily

require a payment for such programs, services, or activities, adjust

the cost of such programs, services, and activities provided to the

individual or the individual’s child based on the individual’s ability

to pay.

SEC. 809. RESERVATIONS AND ALLOTMENTS.

(a) RESERVATION FOR INDIAN TRIBES, ALASKA NATIVES, AND

NATIVE HAWAIIANS.—The Secretary shall reserve 1 percent of the

total amount appropriated under section 805 for each fiscal year,

to be allotted to Indian tribes, Regional Corporations, and Native

Hawaiian entities, of which— (1) 0.5 percent shall be available to Indian tribes; and

(2) 0.5 percent shall be available to Regional Corporations

and Native Hawaiian entities.

(b) ALLOTMENTS.—From the funds appropriated under this title

for each fiscal year that are not reserved under subsection (a),

the Secretary shall allot to each State the sum of—

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–85

(1) an amount that bears the same ratio to 50 percent

of such funds as the number of children 4 years of age and

younger in the State bears to the number of such children

in all States; and

(2) an amount that bears the same ratio to 50 percent

of such funds as the number of children 4 years of age and

younger living in families with incomes below the poverty line

in the State bears to the number of such children in all States.

(c) MINIMUM ALLOTMENT.—No State shall receive an allotment

under subsection (b) for a fiscal year in an amount that is less

than .40 percent of the total amount appropriated for the fiscal

year under this title.

(d) AVAILABILITY OF FUNDS.—Any portion of the allotment to

a State that is not expended for activities under this title in the

fiscal year for which the allotment is made shall remain available

to the State for two additional years, after which any unexpended

funds shall be returned to the Secretary. The Secretary shall use

the returned funds to carry out a discretionary grant program

for research-based early learning demonstration projects.

(e) DATA.—The Secretary shall make allotments under this

title on the basis of the most recent data available to the Secretary.

SEC. 810. GRANT ADMINISTRATION.

(a) FEDERAL ADMINISTRATIVE COSTS.—The Secretary may use

not more than 3 percent of the amount appropriated under section

805 for a fiscal year to pay for the administrative costs of carrying

out this title, including the monitoring and evaluation of State

and local efforts.

(b) STATE ADMINISTRATIVE COSTS.—A State that receives a

grant under this title may use—

(1) not more than 2 percent of the funds made available

through the grant to carry out activities designed to coordinate

early learning programs on the State level, including programs

funded or operated by the State educational agency, health,

children and family, and human service agencies, and any

State-level collaboration or coordination council involving early

learning and education, such as the entities funded under section 640(a)(5) of the Head Start Act (42 U.S.C. 9835(a)(5));

(2) not more than 2 percent of the funds made available

through the grant for the administrative costs of carrying out

the grant program and the costs of reporting State and local

efforts to the Secretary; and

(3) not more than 3 percent of the funds made available

through the grant for training, technical assistance, and wage

incentives provided by the State to Local Councils.

(c) LEAD STATE AGENCY.—

(1) IN GENERAL.—To be eligible to receive an allotment

under this title, the Governor of a State shall appoint, after

consultation with the leadership of the State legislature, a

Lead State Agency to carry out the functions described in

paragraph (2).

(2) LEAD STATE AGENCY.—

(A) ALLOCATION OF FUNDS.—The Lead State Agency

described in paragraph (1) shall allocate funds to Local

Councils as described in section 812.

114 STAT. 2763A–86 PUBLIC LAW 106–554—APPENDIX A

(B) FUNCTIONS OF AGENCY.—In addition to allocating

funds pursuant to subparagraph (A), the Lead State Agency

shall—

(i) advise and assist Local Councils in the performance of their duties under this title;

(ii) develop and submit the State application;

(iii) evaluate and approve applications submitted

by Local Councils under section 813;

(iv) ensure collaboration with respect to assistance

provided under this title between the State agency

responsible for education and the State agency responsible for children and family services;

(v) prepare and submit to the Secretary, an annual

report on the activities carried out in the State under

this title, which shall include a statement describing

how all funds received under this title are expended

and documentation of the effects that resources under

this title have had on—

(I) parental capacity to improve learning readiness in their young children;

(II) early childhood literacy;

(III) linkages among early learning programs;

(IV) linkages between early learning programs

and health care services for young children;

(V) access to early learning activities for young

children with special needs;

(VI) access to existing early learning programs

through expansion of the days or times that children are served;

(VII) access to existing early learning programs through expansion of the number of young

children served;

(VIII) access to and affordability of existing

early learning programs for low-income families;

(IX) the quality of early learning programs

resulting from professional development, and

recruitment and retention incentives for caregivers; and

(X) removal of ancillary barriers to early learning, including transportation difficulties and

absence of programs during nontraditional work

times; and

(vi) ensure that training and research is made

available to Local Councils and that such training and

research reflects the latest available brain development

and early childhood development research related to

early learning.

SEC. 811. STATE REQUIREMENTS.

(a) ELIGIBILITY.—To be eligible for a grant under this title,

a State shall—

(1) ensure that funds received by the State under this

title shall be subject to appropriation by the State legislature,

consistent with the terms and conditions required under State

law;

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–87

(2) designate a Lead State Agency under section 810(c)

to administer and monitor the grant and ensure State-level

coordination of early learning programs;

(3) submit to the Secretary an application at such time,

in such manner, and accompanied by such information as the

Secretary may require;

(4) ensure that funds made available under this title are

distributed on a competitive basis throughout the State to

Local Councils serving rural, urban, and suburban areas of

the State; and

(5) assist the Secretary in developing mechanisms to ensure

that Local Councils receiving funds under this title comply

with the requirements of this title.

(b) STATE PREFERENCE.—In awarding grants to Local Councils

under this title, the State, to the maximum extent possible, shall

ensure that a broad variety of early learning programs that provide

a continuity of services across the age spectrum assisted under

this title are funded under this title, and shall give preference

to supporting— (1) a Local Council that meets criteria, that are specified

by the State and approved by the Secretary, for qualifying

as serving an area of greatest need for early learning programs;

and

(2) a Local Council that demonstrates, in the application

submitted under section 813, the Local Council’s potential to

increase collaboration as a means of maximizing use of

resources provided under this title with other resources available for early learning programs.

(c) LOCAL PREFERENCE.—In awarding grants under this title,

Local Councils shall give preference to supporting—

(1) projects that demonstrate their potential to collaborate

as a means of maximizing use of resources provided under

this title with other resources available for early learning programs;

(2) programs that provide a continuity of services for young

children across the age spectrum, individually, or through

community-based networks or cooperative agreements; and

(3) programs that help parents and other caregivers promote early learning with their young children.

(d) PERFORMANCE GOALS.—

(1) ASSESSMENTS.—Based on information and data received

from Local Councils, and information and data available

through State resources, the State shall biennially assess the

needs and available resources related to the provision of early

learning programs within the State.

(2) PERFORMANCE GOALS.—Based on the analysis of

information described in paragraph (1), the State shall establish

measurable performance goals to be achieved through activities

assisted under this title.

(3) REQUIREMENT.—The State shall award grants to Local

Councils only for purposes that are consistent with the performance goals established under paragraph (2).

(4) REPORT.—The State shall report to the Secretary

annually regarding the State’s progress toward achieving the

performance goals established in paragraph (2) and any necessary modifications to those goals, including the rationale

for the modifications.

114 STAT. 2763A–88 PUBLIC LAW 106–554—APPENDIX A

(5) IMPROVEMENT PLANS.—If the Secretary determines,

based on the State report submitted under paragraph (4), that

the State is not making progress toward achieving the performance goals described in paragraph (2), then the State shall

submit a performance improvement plan to the Secretary, and

demonstrate reasonable progress in implementing such plan,

in order to remain eligible for funding under this title.

SEC. 812. LOCAL ALLOCATIONS.

(a) IN GENERAL.—The Lead State Agency shall allocate to Local

Councils in the State not less than 93 percent of the funds provided

to the State under this title for a fiscal year.

(b) LIMITATION.—The Lead State Agency shall allocate funds

provided under this title on the basis of the population of the

locality served by the Local Council.

SEC. 813. LOCAL APPLICATIONS.

(a) IN GENERAL.—To be eligible to receive assistance under

this title, the Local Council shall submit an application to the

Lead State Agency at such time, in such manner, and containing

such information as the Lead State Agency may require.

(b) CONTENTS.—Each application submitted pursuant to subsection (a) shall include a statement ensuring that the local government entity, Indian tribe, Regional Corporation, or Native Hawaiian

entity has established or designated a Local Council under section

814, and the Local Council has developed a local plan for carrying

out early learning programs under this title that includes—

(1) a needs and resources assessment concerning early

learning services and a statement describing how early learning

programs will be funded consistent with the assessment;

(2) a statement of how the Local Council will ensure that

early learning programs will meet the performance goals

reported by the Lead State Agency under this title; and

(3) a description of how the Local Council will form

collaboratives among local youth, social service, and educational

providers to maximize resources and concentrate efforts on

areas of greatest need.

SEC. 814. LOCAL ADMINISTRATION.

(a) LOCAL COUNCIL.—

(1) IN GENERAL.—To be eligible to receive funds under

this title, a local government entity, Indian tribe, Regional

Corporation, or Native Hawaiian entity, as appropriate, shall

establish or designate a Local Council, which shall be composed

of—

(A) representatives of local agencies directly affected

by early learning programs assisted under this title;

(B) parents;

(C) other individuals concerned with early learning

issues in the locality, such as representative entities providing elementary education, child care resource and referral

services, early learning opportunities, child care, and health

services; and

(D) other key community leaders.

(2) DESIGNATING EXISTING ENTITY.—If a local government

entity, Indian tribe, Regional Corporation, or Native Hawaiian

entity has, before the date of enactment of the Early Learning

Opportunities Act, a Local Council or a regional entity that

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–89

is comparable to the Local Council described in paragraph

(1), the entity, tribe, or corporation may designate the council

or entity as a Local Council under this title, and shall be

considered to have established a Local Council in compliance

with this subsection.

(3) FUNCTIONS.—The Local Council shall be responsible

for preparing and submitting the application described in section 813.

(b) ADMINISTRATION.— (1) ADMINISTRATIVE COSTS.—Not more than 3 percent of

the funds received by a Local Council under this title shall

be used to pay for the administrative costs of the Local Council

in carrying out this title.

(2) FISCAL AGENT.—A Local Council may designate any

entity, with a demonstrated capacity for administering grants,

that is affected by, or concerned with, early learning issues,

including the State, to serve as fiscal agent for the administration of grant funds received by the Local Council under this

title.

TITLE IX—RURAL EDUCATION ACHIEVEMENT PROGRAM

SEC. 901. RURAL EDUCATION INITIATIVE.

Subpart 2 of part J of title X of the Elementary and Secondary

Education Act of 1965 (20 U.S.C. 8291 et seq.) is amended to

read as follows:

‘‘Subpart 2—Rural Education Initiative

‘‘SEC. 10971. SHORT TITLE.

‘‘This subpart may be cited as the ‘Rural Education Achievement Program’.

‘‘SEC. 10972. PURPOSE.

‘‘It is the purpose of this subpart to address the unique needs

of rural school districts that frequently—

‘‘(1) lack the personnel and resources needed to compete

for Federal competitive grants; and

‘‘(2) receive formula allocations in amounts too small to

be effective in meeting their intended purposes.

‘‘SEC. 10973. AUTHORIZATION OF APPROPRIATIONS.

‘‘There are authorized to be appropriated to carry out this

subpart $62,500,000 for fiscal year 2001.

‘‘SEC. 10974. FORMULA GRANT PROGRAM AUTHORIZED.

‘‘(a) ALTERNATIVE USES.—

‘‘(1) IN GENERAL.—Notwithstanding any other provision of

law, an eligible local educational agency may use the applicable

funding, that the agency is eligible to receive from the State

educational agency for a fiscal year, to carry out local activities

authorized in part A of title I, section 2210(b), section 3134,

or section 4116.

‘‘(2) NOTIFICATION.—An eligible local educational agency

shall notify the State educational agency of the local educational

agency’s intention to use the applicable funding in accordance

with paragraph (1) not later than a date that is established

by the State educational agency for the notification.

114 STAT. 2763A–90 PUBLIC LAW 106–554—APPENDIX A

‘‘(b) ELIGIBILITY.—A local educational agency shall be eligible

to use the applicable funding in accordance with subsection (a)

if— ‘‘(1) the total number of students in average daily attendance at all of the schools served by the local educational agency

is less than 600; and

‘‘(2) all of the schools served by the local educational agency

are designated with a School Locale Code of 7 or 8, as determined by the Secretary of Education.

‘‘(c) APPLICABLE FUNDING.—In this section, the term ‘applicable

funding’ means funds provided under each of titles II, IV, and

VI, except for funds made available under section 321 of the Department of Education Appropriations Act, 2001. ‘‘(d) DISBURSAL.—Each State educational agency that receives

applicable funding for a fiscal year shall disburse the applicable

funding to local educational agencies for alternative uses under

this section for the fiscal year at the same time that the State

educational agency disburses the applicable funding to local educational agencies that do not intend to use the applicable funding

for such alternative uses for the fiscal year. ‘‘(e) SUPPLEMENT NOT SUPPLANT.—Funds made available under

this section shall be used to supplement and not supplant any

other State or local education funds.

‘‘(f ) SPECIAL RULE.—References in Federal law to funds for

the provisions of law set forth in subsection (c) may be considered

to be references to funds for this section.

‘‘(g) CONSTRUCTION.—Nothing in this subpart shall be construed

to prohibit a local educational agency that enters into cooperative

arrangements with other local educational agencies for the provision

of special, compensatory, or other education services pursuant to

State law or a written agreement from entering into similar

arrangements for the use or the coordination of the use of the

funds made available under this subpart.

‘‘SEC. 10975. COMPETITIVE GRANT PROGRAM AUTHORIZED.

‘‘(a) IN GENERAL.—The Secretary is authorized to award grants

to eligible local educational agencies to enable the local educational

agencies to carry out local activities authorized in part A of title

I, section 2210(b), section 3134, or section 4116.

‘‘(b) ELIGIBILITY.—A local educational agency shall be eligible

to receive a grant under this section if—

‘‘(1) the total number of students in average daily attendance at all of the schools served by the local educational agency

is less than 600; and

‘‘(2) all of the schools served by the local educational agency

are designated with a School Locale Code of 7 or 8, as determined by the Secretary of Education.

‘‘(c) AMOUNT.—

‘‘(1) IN GENERAL.—The Secretary shall award a grant to

a local educational agency under this section for a fiscal year

in an amount equal to the amount determined under paragraph

(2) for the fiscal year minus the total amount received under

the provisions of law described under section 10974(c) for the

fiscal year.

‘‘(2) DETERMINATION.—The amount referred to in paragraph (1) is equal to $100 multiplied by the total number of students

in excess of 50 students that are in average daily attendance

PUBLIC LAW 106–554—APPENDIX A 114 STAT. 2763A–91

at the schools served by the local educational agency, plus

$20,000, except that the amount may not exceed $60,000.

‘‘(3) CENSUS DETERMINATION.—

‘‘(A) IN GENERAL.—Each local educational agency desiring a grant under this section shall determine for each

year the number of kindergarten through grade 12 students

in average daily attendance at the schools served by the

local educational agency during the period beginning or

the first day of classes and ending on December 1.

‘‘(B) SUBMISSION.—Each local educational agency shall

submit the number described in subparagraph (A) to the

Secretary not later than March 1 of each year.

‘‘(4) PENALTY.—If the Secretary determines that a local

educational agency has knowingly submitted false information

under paragraph (3) for the purpose of gaining additional funds

under this section, then the local educational agency shall

be fined an amount equal to twice the difference between the

amount the local educational agency received under this section,

and the correct amount the local educational agency would

have received under this section if the agency had submitted

accurate information under paragraph (3).

‘‘(d) DISBURSAL.—The Secretary shall disburse the funds

awarded to a local educational agency under this section for a

fiscal year not later than July 1 of that year.

‘‘(e) SUPPLEMENT NOT SUPPLANT.—Funds made available under

this section shall be used to supplement and not supplant any

other State or local education funds.

‘‘SEC. 10976. ACCOUNTABILITY.

‘‘(a) ACADEMIC ACHIEVEMENT.—

‘‘(1) IN GENERAL.—Each local educational agency that uses

or receives funds under section 10974 or 10975 for a fiscal

year shall—

‘‘(A) administer an assessment that is used statewide

and is consistent with the assessment described in section

1111(b), to assess the academic achievement of students

in the schools served by the local educational agency; or

‘‘(B) in the case of a local educational agency for which

there is no statewide assessment described in subparagraph

(A), administer a test, that is selected by the local educational agency, to assess the academic achievement of

students in the schools served by the local educational

agency.

‘‘(2) SPECIAL RULE.—Each local educational agency that

uses or receives funds under section 10974 or 10975 shall

use the same assessment or test described in paragraph (1)

for each year of participation in the program carried out under

such section.

‘‘(b) STATE EDUCATIONAL AGENCY DETERMINATION REGARDING

CONTINUING PARTICIPATION.—Each State educational agency that

receives funding under the provisions of law described in section

10974(c) shall—

‘‘(1) after the third year that a local educational agency

in the State participates in a program authorized under section

10974 or 10975 and on the basis of the results of the assessments or tests described in subsection (a), determine whether

114 STAT. 2763A–92 PUBLIC LAW 106–554—APPENDIX A

the students served by the local educational agency participating in the program performed better on the assessments or

tests after the third year of the participation than the students

performed on the assessments or tests after the first year

of the participation;

‘‘(2) permit only the local educational agencies that participated in the program and served students that performed better

on the assessments or tests, as described in paragraph (1),

to continue to participate in the program for an additional

period of 3 years; and

‘‘(3) prohibit the local educational agencies that participated

in the program and served students that did not perform better

on the assessments or tests, as described in paragraph (1),

from participating in the program, for a period of 3 years

from the date of the determination.

‘‘SEC. 10977. RATABLE REDUCTIONS IN CASE OF INSUFFICIENT APPROPRIATIONS.

‘‘(a) IN GENERAL.—If the amount appropriated for any fiscal

year and made available for grants under this subpart is insufficient

to pay the full amount for which all agencies are eligible under

this subpart, the Secretary shall ratably reduce each such amount.

‘‘(b) ADDITIONAL AMOUNTS.—If additional funds become available for making payments under paragraph (1) for such fiscal

year, payments that were reduced under subsection (a) shall be

increased on the same basis as such payments were reduced.

‘‘SEC. 10978. APPLICABILITY.

‘‘Sections 10951 and 10952 shall not apply to this subpart.’’.

This Act may be cited as the ‘‘Departments of Labor, Health

and Human Services, and Education, and Related Agencies Appropriations Act, 2001’’.

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–93

APPENDIX B—H.R. 5657

That the following sums are appropriated, out of any money in

the Treasury not otherwise appropriated, for the Legislative Branch

for the fiscal year ending September 30, 2001, and for other purposes, namely:

TITLE I—CONGRESSIONAL OPERATIONS

SENATE

PAYMENT TO WIDOWS AND HEIRS OF DECEASED MEMBERS OF

CONGRESS

For a payment to Nancy Nally Coverdell, widow of Paul D.

Coverdell, late a Senator from Georgia, $141,300.

EXPENSE ALLOWANCES

For expense allowances of the Vice President, $10,000; the

President Pro Tempore of the Senate, $10,000; Majority Leader

of the Senate, $10,000; Minority Leader of the Senate, $10,000;

Majority Whip of the Senate, $5,000; Minority Whip of the Senate,

$5,000; and Chairmen of the Majority and Minority Conference

Committees, $3,000 for each Chairman; and Chairmen of the Majority and Minority Policy Committees, $3,000 for each Chairman;

in all, $62,000.

REPRESENTATION ALLOWANCES FOR THE MAJORITY AND MINORITY

LEADERS

For representation allowances of the Majority and Minority

Leaders of the Senate, $15,000 for each such Leader; in all, $30,000.

SALARIES, OFFICERS AND EMPLOYEES

For compensation of officers, employees, and others as authorized by law, including agency contributions, $92,321,000, which

shall be paid from this appropriation without regard to the below

limitations, as follows:

OFFICE OF THE VICE PRESIDENT

For the Office of the Vice President, $1,785,000.

OFFICE OF THE PRESIDENT PRO TEMPORE

For the Office of the President Pro Tempore, $453,000.

114 STAT. 2763A–94 PUBLIC LAW 106–554—APPENDIX B

OFFICES OF THE MAJORITY AND MINORITY LEADERS

For Offices of the Majority and Minority Leaders, $2,742,000.

OFFICES OF THE MAJORITY AND MINORITY WHIPS

For Offices of the Majority and Minority Whips, $1,722,000.

COMMITTEE ON APPROPRIATIONS

For salaries of the Committee on Appropriations, $6,917,000.

CONFERENCE COMMITTEES

For the Conference of the Majority and the Conference of the

Minority, at rates of compensation to be fixed by the Chairman

of each such committee, $1,152,000 for each such committee; in

all, $2,304,000.

OFFICES OF THE SECRETARIES OF THE CONFERENCE OF THE MAJORITY

AND THE CONFERENCE OF THE MINORITY

For Offices of the Secretaries of the Conference of the Majority

and the Conference of the Minority, $590,000.

POLICY COMMITTEES

For salaries of the Majority Policy Committee and the Minority

Policy Committee, $1,171,000 for each such committee; in all,

$2,342,000.

OFFICE OF THE CHAPLAIN

For Office of the Chaplain, $288,000.

OFFICE OF THE SECRETARY

For Office of the Secretary, $14,738,000.

OFFICE OF THE SERGEANT AT ARMS AND DOORKEEPER

For Office of the Sergeant at Arms and Doorkeeper, $34,811,000.

OFFICES OF THE SECRETARIES FOR THE MAJORITY AND MINORITY

For Offices of the Secretary for the Majority and the Secretary

for the Minority, $1,292,000.

AGENCY CONTRIBUTIONS AND RELATED EXPENSES

For agency contributions for employee benefits, as authorized

by law, and related expenses, $22,337,000.

OFFICE OF THE LEGISLATIVE COUNSEL OF THE SENATE

For salaries and expenses of the Office of the Legislative Counsel of the Senate, $4,046,000.

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–95

OFFICE OF SENATE LEGAL COUNSEL

For salaries and expenses of the Office of Senate Legal Counsel, $1,069,000.

EXPENSE ALLOWANCES OF THE SECRETARY OF THE SENATE, SERGEANT AT ARMS AND DOORKEEPER OF THE SENATE, AND SECRETARIES FOR THE MAJORITY AND MINORITY OF THE SENATE

For expense allowances of the Secretary of the Senate, $3,000;

Sergeant at Arms and Doorkeeper of the Senate, $3,000; Secretary

for the Majority of the Senate, $3,000; Secretary for the Minority

of the Senate, $3,000; in all, $12,000.

CONTINGENT EXPENSES OF THE SENATE

INQUIRIES AND INVESTIGATIONS

For expenses of inquiries and investigations ordered by the

Senate, or conducted pursuant to section 134(a) of Public Law

601, Seventy-ninth Congress, as amended, section 112 of Public

Law 96–304 and Senate Resolution 281, agreed to March 11, 1980,

$73,000,000.

EXPENSES OF THE UNITED STATES SENATE CAUCUS ON

INTERNATIONAL NARCOTICS CONTROL

For expenses of the United States Senate Caucus on International Narcotics Control, $370,000.

SECRETARY OF THE SENATE

For expenses of the Office of the Secretary of the Senate,

$2,077,000.

SERGEANT AT ARMS AND DOORKEEPER OF THE SENATE

For expenses of the Office of the Sergeant at Arms and Doorkeeper of the Senate, $71,511,000, of which $2,500,000 shall remain

available until September 30, 2003.

MISCELLANEOUS ITEMS

For miscellaneous items, $8,655,000.

SENATORS’ OFFICIAL PERSONNEL AND OFFICE EXPENSE ACCOUNT

For Senators’ Official Personnel and Office Expense Account,

$253,203,000.

OFFICIAL MAIL COSTS

For expenses necessary for official mail costs of the Senate $300,000.

ADMINISTRATIVE PROVISIONS

SECTION 1. SEMIANNUAL REPORT. (a) IN GENERAL.—Section

105(a) of the Legislative Branch Appropriations Act, 1965 (2 U.S.C.

104a) is amended by adding at the end the following:

114 STAT. 2763A–96 PUBLIC LAW 106–554—APPENDIX B

‘‘(5)(A) Notwithstanding the requirements of paragraph (1)

relating to the level of detail of statement and itemization, each

report by the Secretary of the Senate required under such paragraph shall be compiled at a summary level for each office of

the Senate authorized to obligate appropriated funds.

‘‘(B) Subparagraph (A) shall not apply to the reporting of

expenditures relating to personnel compensation, travel and

transportation of persons, other contractual services, and acquisition

of assets.

‘‘(C) In carrying out this paragraph the Secretary of the Senate

shall apply the Standard Federal Object Classification of Expenses

as the Secretary determines appropriate.’’.

(b) EFFECTIVE DATE AND APPLICATION.— (1) IN GENERAL.—Subject to paragraph (2), the amendment

made by this section shall take effect on the date of enactment

of this Act.

(2) FIRST REPORT AFTER ENACTMENT.—The Secretary of the

Senate may elect to compile and submit the report for the

semiannual period during which the date of enactment of this

section occurs, as if the amendment made by this section had

not been enacted.

SEC. 2. SENATE EMPLOYEE PAY ADJUSTMENTS. Section 4 of

the Federal Pay Comparability Act of 1970 (2 U.S.C. 60a–1) is

amended—

(1) in subsection (a)—

(A) by inserting ‘‘(or section 5304 or 5304a of such

title, as applied to employees employed in the pay locality

of the Washington, D.C.-Baltimore, Maryland consolidated

metropolitan statistical area)’’ after ‘‘employees under section 5303 of title 5, United States Code,’’; and

(B) by inserting ‘‘(and, as the case may be, section

5304 or 5304a of such title, as applied to employees

employed in the pay locality of the Washington, D.C.-Baltimore, Maryland consolidated metropolitan statistical area)’’

after ‘‘the President under such section 5303’’;

(2) by redesignating subsection (e) as subsection (f ); and

(3) by inserting after subsection (d) the following:

‘‘(e) Any percentage used in any statute specifically providing

for an adjustment in rates of pay in lieu of an adjustment made

under section 5303 of title 5, United States Code, and, as the

case may be, section 5304 or 5304a of such title for any calendar

year shall be treated as the percentage used in an adjustment

made under such section 5303, 5304, or 5304a, as applicable, for

purposes of subsection (a).’’.

SEC. 3. (a) Section 6(c) of the Legislative Branch Appropriations

Act, 1999 (2 U.S.C. 121b–1(c)) is amended—

(1) by striking ‘‘and agency contributions’’ in paragraph

(2)(A), and

(2) by adding at the end the following:

‘‘(3) Agency contributions for employees of Senate Hair

Care Services shall be paid from the appropriations account

for ‘SALARIES, OFFICERS AND EMPLOYEES’.’’.

(b) This section shall apply to pay periods beginning on or

after October 1, 2000.

SEC. 4. (a) There is established in the Treasury of the United

States a revolving fund to be known as the Senate Health and

Fitness Facility Revolving Fund (‘‘the revolving fund’’).

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–97

(b) The Architect of the Capitol shall deposit in the revolving

fund— (1) any amounts received as dues or other assessments

for use of the Senate Health and Fitness Facility, and

(2) any amounts received from the operation of the Senate

waste recycling program.

(c) Subject to the approval of the Committee on Appropriations

of the Senate, amounts in the revolving fund shall be available

to the Architect of the Capitol, without fiscal year limitation, for

payment of costs of the Senate Health and Fitness Facility.

(d) The Architect of the Capitol shall withdraw from the revolving fund and deposit in the Treasury of the United States as

miscellaneous receipts all moneys in the revolving fund that the

Architect determines are in excess of the current and reasonably

foreseeable needs of the Senate Health and Fitness Facility.

(e) Subject to the approval of the Committee on Rules and

Administration of the Senate, the Architect of the Capitol may

issue such regulations as may be necessary to carry out the provisions of this section.

SEC. 5. For each fiscal year (commencing with the fiscal year

ending September 30, 2001), there is authorized an expense allowance for the Chairmen of the Majority and Minority Policy Committees which shall not exceed $3,000 each fiscal year for each such

Chairman; and amounts from such allowance shall be paid to either

of such Chairmen only as reimbursement for actual expenses

incurred by him and upon certification and documentation of such

expenses, and amounts so paid shall not be reported as income

and shall not be allowed as a deduction under the Internal Revenue

Code of 1986.

SEC. 6. (a) The head of the employing office of an employee

of the Senate may, upon termination of employment of the employee,

authorize payment of a lump sum for the accrued annual leave

of that employee if—

(1) the head of the employing office—

(A) has approved a written leave policy authorizing

employees to accrue leave and establishing the conditions

upon which accrued leave may be paid; and

(B) submits written certification to the Financial Clerk

of the Senate of the number of days of annual leave accrued

by the employee for which payment is to be made under

the written leave policy of the employing office; and

(2) there are sufficient funds to cover the lump sum payment.

(b)(1) A lump sum payment under this section shall not exceed

the lesser of—

(A) twice the monthly rate of pay of the employee; or

(B) the product of the daily rate of pay of the employee

and the number of days of accrued annual leave of the

employee.

(2) The Secretary of the Senate shall determine the rates of

pay of an employee under paragraph (1)(A) and (B) on the basis

of the annual rate of pay of the employee in effect on the date

of termination of employment.

(c) Any payment under this section shall be paid from the

appropriation account or fund used to pay the employee.

(d) If an individual who received a lump sum payment under

this section is reemployed as an employee of the Senate before

114 STAT. 2763A–98 PUBLIC LAW 106–554—APPENDIX B

the end of the period covered by the lump sum payment, the

individual shall refund an amount equal to the applicable pay

covering the period between the date of reemployment and the

expiration of the lump sum period. Such amount shall be deposited

to the appropriation account or fund used to pay the lump sum

payment.

(e) The Committee on Rules and Administration of the Senate

may prescribe regulations to carry out this section.

(f ) In this section, the term— (1) ‘‘employee of the Senate’’ means any employee whose

pay is disbursed by the Secretary of the Senate, except that

the term does not include a member of the Capitol Police

or a civilian employee of the Capitol Police; and

(2) ‘‘head of the employing office’’ means any person with

the final authority to appoint, hire, discharge, and set the

terms, conditions, or privileges of the employment of an individual whose pay is disbursed by the Secretary of the Senate.

SEC. 7. (a) Agency contributions for employees whose salaries

are disbursed by the Secretary of the Senate from the appropriations

account ‘‘JOINT ECONOMIC COMMITTEE’’ under the heading ‘‘JOINT

ITEMS’’ shall be paid from the Senate appropriations account for ‘‘SALARIES, OFFICERS AND EMPLOYEES’’. (b) This section shall apply to pay periods beginning on or

after October 1, 2000.

SEC. 8. Section 316 of Public Law 101–302 (40 U.S.C. 188b– 6) is amended— (1) in the first sentence of subsection (a) by striking ‘‘items

of art, fine art, and historical items’’ and inserting ‘‘works

of art, historical objects, documents, or material relating to

historical matters for placement or exhibition’’;

(2) in the second sentence of subsection (a)— (A) by striking ‘‘such items’’ each place it appears and

inserting ‘‘such works, objects, documents, or material’’ in

each such place; and

(B) by striking ‘‘an item’’ and inserting ‘‘a work, object,

document, or material’’; and

(3) in subsection (b)— (A) by striking ‘‘such items of art’’ and inserting ‘‘such

works, objects, documents, or materials’’; and

(B) by striking ‘‘shall’’ and inserting ‘‘may’’.

HOUSE OF REPRESENTATIVES

SALARIES AND EXPENSES

For salaries and expenses of the House of Representatives,

$769,551,000, as follows:

HOUSE LEADERSHIP OFFICES

For salaries and expenses, as authorized by law, $14,378,000,

including: Office of the Speaker, $1,759,000, including $25,000 for

official expenses of the Speaker; Office of the Majority Floor Leader,

$1,726,000, including $10,000 for official expenses of the Majority

Leader; Office of the Minority Floor Leader, $2,096,000, including

$10,000 for official expenses of the Minority Leader; Office of the

Majority Whip, including the Chief Deputy Majority Whip,

$1,466,000, including $5,000 for official expenses of the Majority

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–99

Whip; Office of the Minority Whip, including the Chief Deputy

Minority Whip, $1,096,000, including $5,000 for official expenses

of the Minority Whip; Speaker’s Office for Legislative Floor Activi- ties, $410,000; Republican Steering Committee, $765,000; Republican Conference, $1,255,000; Democratic Steering and Policy

Committee, $1,352,000; Democratic Caucus, $668,000; nine minority

employees, $1,229,000; training and program development—majority, $278,000; and training and program development—minority,

$278,000.

MEMBERS’ REPRESENTATIONAL ALLOWANCES

INCLUDING MEMBERS’ CLERK HIRE, OFFICIAL EXPENSES OF

MEMBERS, AND OFFICIAL MAIL

For Members’ representational allowances, including Members’

clerk hire, official expenses, and official mail, $410,182,000.

COMMITTEE EMPLOYEES

STANDING COMMITTEES, SPECIAL AND SELECT

For salaries and expenses of standing committees, special and

select, authorized by House resolutions, $92,196,000: Provided, That

such amount shall remain available for such salaries and expenses

until December 31, 2002.

COMMITTEE ON APPROPRIATIONS

For salaries and expenses of the Committee on Appropriations, $20,628,000, including studies and examinations of executive agencies and temporary personal services for such committee, to be

expended in accordance with section 202(b) of the Legislative

Reorganization Act of 1946 and to be available for reimbursement

to agencies for services performed: Provided, That such amount

shall remain available for such salaries and expenses until December 31, 2002.

SALARIES, OFFICERS AND EMPLOYEES

For compensation and expenses of officers and employees, as

authorized by law, $90,403,000, including: for salaries and expenses

of the Office of the Clerk, including not more than $3,500, of

which not more than $2,500 is for the Family Room, for official

representation and reception expenses, $14,590,000; for salaries

and expenses of the Office of the Sergeant at Arms, including

the position of Superintendent of Garages, and including not more

than $750 for official representation and reception expenses,

$3,692,000; for salaries and expenses of the Office of the Chief

Administrative Officer, $58,550,000, of which $1,054,000 shall

remain available until expended, including $26,605,000 for salaries,

expenses and temporary personal services of House Information

Resources, of which $26,020,000 is provided herein: Provided, That

of the amount provided for House Information Resources, $6,497,000

shall be for net expenses of telecommunications: Provided further,

That House Information Resources is authorized to receive

reimbursement from Members of the House of Representatives and

other governmental entities for services provided and such

114 STAT. 2763A–100 PUBLIC LAW 106–554—APPENDIX B

reimbursement shall be deposited in the Treasury for credit to

this account; for salaries and expenses of the Office of the Inspector

General, $3,249,000; for salaries and expenses of the Office of

General Counsel, $806,000; for the Office of the Chaplain, $140,000;

for salaries and expenses of the Office of the Parliamentarian,

including the Parliamentarian and $2,000 for preparing the Digest

of Rules, $1,201,000; for salaries and expenses of the Office of

the Law Revision Counsel of the House, $2,045,000; for salaries

and expenses of the Office of the Legislative Counsel of the House,

$5,085,000; for salaries and expenses of the Corrections Calendar

Office, $832,000; and for other authorized employees, $213,000.

ALLOWANCES AND EXPENSES

For allowances and expenses as authorized by House resolution or law, $141,764,000, including: supplies, materials, administrative

costs and Federal tort claims, $2,235,000; official mail for committees, leadership offices, and administrative offices of the House,

$410,000; Government contributions for health, retirement, Social

Security, and other applicable employee benefits, $138,726,000; and

miscellaneous items including purchase, exchange, maintenance,

repair, and operation of House motor vehicles, interparliamentary

receptions, and gratuities to heirs of deceased employees of the

House, $393,000.

CHILD CARE CENTER

For salaries and expenses of the House of Representatives

Child Care Center, such amounts as are deposited in the account

established by section 312(d)(1) of the Legislative Branch Appropriations Act, 1992 (40 U.S.C. 184g(d)(1)), subject to the level specified

in the budget of the Center, as submitted to the Committee on

Appropriations of the House of Representatives.

ADMINISTRATIVE PROVISIONS

SEC. 101. During fiscal year 2001 and any succeeding fiscal

year, the Chief Administrative Officer of the House of Representatives may—

(1) enter into contracts for the acquisition of severable

services for a period that begins in 1 fiscal year and ends

in the next fiscal year to the same extent as the head of

an executive agency under the authority of section 303L of

the Federal Property and Administrative Services Act of 1949

(41 U.S.C. 253l); and

(2) enter into multiyear contracts for the acquisitions of

property and nonaudit-related services to the same extent as

executive agencies under the authority of section 304B of the

Federal Property and Administrative Services Act of 1949 (41

U.S.C. 254c).

SEC. 102. (a) PERMITTING NEW HOUSE EMPLOYEES TO BE

PLACED ABOVE MINIMUM STEP OF COMPENSATION LEVEL.—The

House Employees Position Classification Act (2 U.S.C. 291 et seq.)

is amended by striking section 10 (2 U.S.C. 299).

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply with respect to employees appointed on or after October

1, 2000.

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–101

SEC. 103. (a) REQUIRING AMOUNTS REMAINING IN MEMBERS’ REPRESENTATIONAL ALLOWANCES TO BE USED FOR DEFICIT REDUC- TION OR TO REDUCE THE FEDERAL DEBT.—Notwithstanding any

other provision of law, any amounts appropriated under this Act

for ‘‘HOUSE OF REPRESENTATIVES—SALARIES AND EXPENSES— MEMBERS’ REPRESENTATIONAL ALLOWANCES’’ shall be available only

for fiscal year 2001. Any amount remaining after all payments

are made under such allowances for fiscal year 2001 shall be

deposited in the Treasury and used for deficit reduction (or, if

there is no Federal budget deficit after all such payments have

been made, for reducing the Federal debt, in such manner as

the Secretary of the Treasury considers appropriate).

(b) REGULATIONS.—The Committee on House Administration

of the House of Representatives shall have authority to prescribe

regulations to carry out this section.

(c) DEFINITION.—As used in this section, the term ‘‘Member

of the House of Representatives’’ means a Representative in, or

a Delegate or Resident Commissioner to, Congress.

SEC. 104. (a) There is hereby appropriated for payment to

the Prince William County Public Schools $215,000, to be used

to pay for educational services for the son of Mrs. Evelyn Gibson,

the widow of Detective John Michael Gibson of the United States

Capitol Police.

(b) The payment under subsection (a) shall be made in accordance with terms and conditions established by the Committee on

House Administration of the House of Representatives.

(c) The funds used for the payment made under subsection

(a) shall be derived from the applicable accounts of the House

of Representatives.

JOINT ITEMS

For Joint Committees, as follows:

JOINT CONGRESSIONAL COMMITTEE ON INAUGURAL CEREMONIES OF

2001

For all construction expenses, salaries, and other expenses associated with conducting the inaugural ceremonies of the President

and Vice President of the United States, January 20, 2001, in

accordance with such program as may be adopted by the joint

committee authorized by Senate Concurrent Resolution 89, agreed

to March 14, 2000 (One Hundred Sixth Congress), and Senate

Concurrent Resolution 90, agreed to March 14, 2000 (One Hundred

Sixth Congress), $1,000,000 to be disbursed by the Secretary of

the Senate and to remain available until September 30, 2001.

Funds made available under this heading shall be available for

payment, on a direct or reimbursable basis, whether incurred on,

before, or after, October 1, 2000: Provided, That the compensation

of any employee of the Committee on Rules and Administration

of the Senate who has been designated to perform service for

the Joint Congressional Committee on Inaugural Ceremonies shall

continue to be paid by the Committee on Rules and Administration,

but the account from which such staff member is paid may be

reimbursed for the services of the staff member (including agency

contributions when appropriate) out of funds made available under

this heading.

114 STAT. 2763A–102 PUBLIC LAW 106–554—APPENDIX B

ADMINISTRATIVE PROVISION

SEC. 105. During fiscal year 2001 the Secretary of Defense

shall provide protective services on a nonreimbursable basis to

the United States Capitol Police with respect to the following events:

(1) Upon request of the Chair of the Joint Congressional

Committee on Inaugural Ceremonies established under Senate

Concurrent Resolution 89, One Hundred Sixth Congress, agreed

to March 14, 2000, the proceedings and ceremonies conducted

for the inauguration of the President-elect and Vice Presidentelect of the United States.

(2) Upon request of the Speaker of the House of Representatives and the President Pro Tempore of the Senate, the joint

session of Congress held to receive a message from the President of the United States on the State of the Union.

JOINT ECONOMIC COMMITTEE

For salaries and expenses of the Joint Economic Committee, $3,315,000, to be disbursed by the Secretary of the Senate.

JOINT COMMITTEE ON TAXATION

For salaries and expenses of the Joint Committee on Taxation,

$6,430,000, to be disbursed by the Chief Administrative Officer

of the House.

For other joint items, as follows:

OFFICE OF THE ATTENDING PHYSICIAN

For medical supplies, equipment, and contingent expenses of

the emergency rooms, and for the Attending Physician and his

assistants, including: (1) an allowance of $1,500 per month to the

Attending Physician; (2) an allowance of $500 per month each

to three medical officers while on duty in the Office of the Attending

Physician; (3) an allowance of $500 per month to one assistant

and $400 per month each not to exceed 11 assistants on the basis

heretofore provided for such assistants; and (4) $1,159,904 for

reimbursement to the Department of the Navy for expenses incurred

for staff and equipment assigned to the Office of the Attending

Physician, which shall be advanced and credited to the applicable

appropriation or appropriations from which such salaries, allowances, and other expenses are payable and shall be available for

all the purposes thereof, $1,835,000, to be disbursed by the Chief

Administrative Officer of the House.

CAPITOL POLICE BOARD

CAPITOL POLICE

SALARIES

For the Capitol Police Board for salaries of officers, members,

and employees of the Capitol Police, including overtime, hazardous

duty pay differential, clothing allowance of not more than $600

each for members required to wear civilian attire, and Government

contributions for health, retirement, Social Security, and other

applicable employee benefits, $97,142,000, of which $47,053,000

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–103

is provided to the Sergeant at Arms of the House of Representatives,

to be disbursed by the Chief Administrative Officer of the House,

and $50,089,000 is provided to the Sergeant at Arms and Doorkeeper of the Senate, to be disbursed by the Secretary of the

Senate: Provided, That, of the amounts appropriated under this

heading, such amounts as may be necessary may be transferred

between the Sergeant at Arms of the House of Representatives

and the Sergeant at Arms and Doorkeeper of the Senate, upon

approval of the Committee on Appropriations of the House of Representatives and the Committee on Appropriations of the Senate.

GENERAL EXPENSES

For the Capitol Police Board for necessary expenses of the

Capitol Police, including motor vehicles, communications and other

equipment, security equipment and installation, uniforms, weapons,

supplies, materials, training, medical services, forensic services,

stenographic services, personal and professional services, the

employee assistance program, not more than $2,000 for the awards

program, postage, telephone service, travel advances, relocation of

instructor and liaison personnel for the Federal Law Enforcement

Training Center, and $85 per month for extra services performed

for the Capitol Police Board by an employee of the Sergeant at

Arms of the Senate or the House of Representatives designated

by the Chairman of the Board, $6,772,000, to be disbursed by

the Capitol Police Board or their delegee: Provided, That, notwithstanding any other provision of law, the cost of basic training

for the Capitol Police at the Federal Law Enforcement Training

Center for fiscal year 2001 shall be paid by the Secretary of the

Treasury from funds available to the Department of the Treasury.

ADMINISTRATIVE PROVISIONS

SEC. 106. Amounts appropriated for fiscal year 2001 for the

Capitol Police Board for the Capitol Police may be transferred

between the headings ‘‘SALARIES’’ and ‘‘GENERAL EXPENSES’’ upon

the approval of— (1) the Committee on Appropriations of the House of Representatives, in the case of amounts transferred from the appropriation provided to the Sergeant at Arms of the House of

Representatives under the heading ‘‘SALARIES’’;

(2) the Committee on Appropriations of the Senate, in

the case of amounts transferred from the appropriation provided

to the Sergeant at Arms and Doorkeeper of the Senate under

the heading ‘‘SALARIES’’; and

(3) the Committees on Appropriations of the Senate and

the House of Representatives, in the case of other transfers.

SEC. 107. (a) APPOINTMENT OF CERTIFYING OFFICERS OF THE

CAPITOL POLICE.—The Chief Administrative Officer of the United

States Capitol Police, or when there is not a Chief Administrative

Officer, the Capitol Police Board, shall appoint certifying officers

to certify all vouchers for payment from funds made available

to the United States Capitol Police.

(b) RESPONSIBILITY AND ACCOUNTABILITY OF CERTIFYING OFFI- CERS.—

(1) IN GENERAL.—Each officer or employee of the Capitol

Police who has been duly authorized in writing by the Chief

Administrative Officer, or the Capitol Police Board if there

114 STAT. 2763A–104 PUBLIC LAW 106–554—APPENDIX B

is not a Chief Administrative Officer, to certify vouchers pursuant to subsection (a) shall—

(A) be held responsible for the existence and correctness of the facts recited in the certificate or otherwise

stated on the voucher or its supporting papers and for

the legality of the proposed payment under the appropriation or fund involved;

(B) be held responsible and accountable for the correctness of the computations of certified vouchers; and

(C) be held accountable for and required to make good

to the United States the amount of any illegal, improper,

or incorrect payment resulting from any false, inaccurate,

or misleading certificate made by such officer or employee,

as well as for any payment prohibited by law or which

did not represent a legal obligation under the appropriation

or fund involved.

(2) RELIEF BY COMPTROLLER GENERAL.—The Comptroller

General may, at the Comptroller General’s discretion, relieve

such certifying officer or employee of liability for any payment

otherwise proper if the Comptroller General finds—

(A) that the certification was based on official records

and that the certifying officer or employee did not know,

and by reasonable diligence and inquiry could not have

ascertained, the actual facts; or

(B) that the obligation was incurred in good faith,

that the payment was not contrary to any statutory provision specifically prohibiting payments of the character

involved, and the United States has received value for

such payment.

(c) ENFORCEMENT OF LIABILITY.—The liability of the certifying

officers of the United States Capitol Police shall be enforced in

the same manner and to the same extent as currently provided

with respect to the enforcement of the liability of disbursing and

other accountable officers, and such officers shall have the right

to apply for and obtain a decision by the Comptroller General

on any question of law involved in a payment on any vouchers

presented to them for certification.

SEC. 108. CHIEF ADMINISTRATIVE OFFICER.—(a) There shall be

within the Capitol Police an Office of Administration to be headed

by a Chief Administrative Officer:

(1) The Chief Administrative Officer shall be appointed

by the Comptroller General after consultation with the Capitol

Police Board, and shall report to and serve at the pleasure

of the Comptroller General.

(2) The Comptroller General shall appoint as Chief

Administrative Officer an individual with the knowledge and

skills necessary to carry out the responsibilities for budgeting,

financial management, information technology, and human

resource management described in this section.

(3) The Chief Administrative Officer shall receive basic

pay at a rate determined by the Comptroller General, but

not to exceed the annual rate of basic pay payable for ES–

2 of the Senior Executive Service Basic Rates Schedule established for members of the Senior Executive Service of the

General Accounting Office under section 733 of title 31.

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–105

(4) The Capitol Police shall reimburse from available appropriations any costs incurred by the General Accounting Office

under this section.

(b) The Chief Administrative Officer shall have the following

areas of responsibility:

(1) BUDGETING.—The Chief Administrative Officer shall—

(A) after consulting with the Chief of Police on the

portion of the budget covering uniformed police force

personnel, prepare and submit to the Capitol Police Board

an annual budget for the Capitol Police; and

(B) execute the budget and monitor through periodic

examinations the execution of the Capitol Police budget

in relation to actual obligations and expenditures.

(2) FINANCIAL MANAGEMENT.—The Chief Administrative

Officer shall—

(A) oversee all financial management activities relating

to the programs and operations of the Capitol Police;

(B) develop and maintain an integrated accounting

and financial system for the Capitol Police, including financial reporting and internal controls, which—

(i) complies with applicable accounting principles,

standards, and requirements, and internal control

standards;

(ii) complies with any other requirements

applicable to such systems;

(iii) provides for—

(I) complete, reliable, consistent, and timely

information which is prepared on a uniform basis

and which is responsive to financial information

needs of the Capitol Police;

(II) the development and reporting of cost

information;

(III) the integration of accounting and budgeting information; and

(IV) the systematic measurement of performance;

(C) direct, manage, and provide policy guidance and

oversight of Capitol Police financial management personnel,

activities, and operations, including—

(i) the recruitment, selection, and training of

personnel to carry out Capitol Police financial management functions; and

(ii) the implementation of Capitol Police asset

management systems, including systems for cash

management, debt collection, and property and inventory management and control; and

(D) the Chief Administrative Officer shall prepare

annual financial statements for the Capitol Police and provide for an annual audit of the financial statements by

an independent public accountant in accordance with generally accepted government auditing standards.

(3) INFORMATION TECHNOLOGY.—The Chief Administrative

Officer shall—

(A) direct, coordinate, and oversee the acquisition, use,

and management of information technology by the Capitol

Police;

114 STAT. 2763A–106 PUBLIC LAW 106–554—APPENDIX B

(B) promote and oversee the use of information technology to improve the efficiency and effectiveness of programs of the Capitol Police; and

(C) establish and enforce information technology principles, guidelines, and objectives, including developing and

maintaining an information technology architecture for the

Capitol Police.

(4) HUMAN RESOURCES.—The Chief Administrative Officer

shall—

(A) direct, coordinate, and oversee human resource

management activities of the Capitol Police, except that

with respect to uniformed police force personnel, the Chief

Administrative Officer shall perform these activities in

cooperation with the Chief of the Capitol Police;

(B) develop and monitor payroll and time and attendance systems and employee services; and

(C) develop and monitor processes for recruiting, selecting, appraising, and promoting employees.

(c) Administrative provisions with respect to the Office of

Administration:

(1) The Chief Administrative Officer is authorized to select,

appoint, employ, and discharge such officers and employees

as may be necessary to carry out the functions, powers, and

duties of the Office of Administration but he shall not have

the authority to hire or discharge uniformed police force personnel.

(2) The Chief Administrative Officer may utilize resources

of another agency on a reimbursable basis to be paid from

available appropriations of the Capitol Police.

(d) No later than 180 days after appointment, the Chief

Administrative Officer shall prepare, after consultation with the

Capitol Police Board and the Chief of the Capitol Police, a plan—

(1) describing the policies, procedures, and actions the Chief

Administrative Officer will take in carrying out the responsibilities assigned under this section;

(2) identifying and defining responsibilities and roles of

all offices, bureaus, and divisions of the Capitol Police for

budgeting, financial management, information technology, and

human resources management; and

(3) detailing mechanisms for ensuring that the offices,

bureaus, and divisions perform their responsibilities and roles

in a coordinated and integrated manner.

(e) No later than September 30, 2001, the Chief Administrative

Officer shall prepare, after consultation with the Capitol Police

Board and the Chief of the Capitol Police, a report on the Chief

Administrative Officer’s progress in implementing the plan

described in subsection (d) and recommendations to improve the

budgeting, financial, information technology, and human resources

management of the Capitol Police, including organizational,

accounting and administrative control, and personnel changes.

(f ) The Chief Administrative Officer shall submit the plan

required in subsection (d) and the report required in subsection

(e) to the Committees on Appropriations of the House of Representatives and of the Senate, the Committee on House Administration

of the House of Representatives, and the Committee on Rules

and Administration of the Senate.

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–107

(g) As of October 1, 2002, unless otherwise determined by

the Comptroller General, the Chief Administrative Officer established by section (a) will cease to be an employee of the General

Accounting Office and will become an employee of the Capitol

Police, and the Capitol Police Board shall assume all responsibilities

of the Comptroller General under this section.

SEC. 109. (a) Section 1(c) of Public Law 96–152 (40 U.S.C.

206–1) is amended by striking ‘‘the annual rate’’ and all that follows

and inserting the following: ‘‘the rate of basic pay payable for

level ES–4 of the Senior Executive Service, as established under

subchapter VIII of chapter 53 of title 5, United States Code (taking

into account any comparability payments made under section

5304(h) of such title).’’. (b) The amendment made by subsection (a) shall apply with

respect to pay periods beginning on or after the date of the enactment of this Act.

CAPITOL GUIDE SERVICE AND SPECIAL SERVICES OFFICE

For salaries and expenses of the Capitol Guide Service and

Special Services Office, $2,371,000, to be disbursed by the Secretary

of the Senate: Provided, That no part of such amount may be

used to employ more than 43 individuals: Provided further, That

the Capitol Guide Board is authorized, during emergencies, to

employ not more than two additional individuals for not more

than 120 days each, and not more than 10 additional individuals

for not more than 6 months each, for the Capitol Guide Service.

STATEMENTS OF APPROPRIATIONS

For the preparation, under the direction of the Committees

on Appropriations of the Senate and the House of Representatives,

of the statements for the second session of the One Hundred Sixth

Congress, showing appropriations made, indefinite appropriations,

and contracts authorized, together with a chronological history of

the regular appropriations bills as required by law, $30,000, to

be paid to the persons designated by the chairmen of such committees to supervise the work.

OFFICE OF COMPLIANCE

SALARIES AND EXPENSES

For salaries and expenses of the Office of Compliance, as

authorized by section 305 of the Congressional Accountability Act

of 1995 (2 U.S.C. 1385), $1,820,000.

CONGRESSIONAL BUDGET OFFICE

SALARIES AND EXPENSES

For salaries and expenses necessary to carry out the provisions

of the Congressional Budget Act of 1974 (Public Law 93–344),

including not more than $3,000 to be expended on the certification

of the Director of the Congressional Budget Office in connection

with official representation and reception expenses, $28,493,000:

Provided, That no part of such amount may be used for the purchase

or hire of a passenger motor vehicle.

114 STAT. 2763A–108 PUBLIC LAW 106–554—APPENDIX B

ADMINISTRATIVE PROVISION

SEC. 110. Beginning on the date of enactment of this Act

and hereafter, the Congressional Budget Office may use available

funds to enter into contracts for the procurement of severable

services for a period that begins in one fiscal year and ends in

the next fiscal year and may enter into multi-year contracts for

the acquisition of property and services, to the same extent as

executive agencies under the authority of section 303L and 304B,

respectively, of the Federal Property and Administrative Services

Act (41 U.S.C. 253l and 254c).

ARCHITECT OF THE CAPITOL

CAPITOL BUILDINGS AND GROUNDS

CAPITOL BUILDINGS

SALARIES AND EXPENSES

For salaries for the Architect of the Capitol, the Assistant

Architect of the Capitol, and other personal services, at rates of

pay provided by law; for surveys and studies in connection with

activities under the care of the Architect of the Capitol; for all

necessary expenses for the maintenance, care and operation of

the Capitol and electrical substations of the Senate and House

office buildings under the jurisdiction of the Architect of the Capitol,

including furnishings and office equipment, including not more

than $1,000 for official reception and representation expenses, to

be expended as the Architect of the Capitol may approve; for purchase or exchange, maintenance and operation of a passenger motor

vehicle; and not to exceed $20,000 for attendance, when specifically

authorized by the Architect of the Capitol, at meetings or conventions in connection with subjects related to work under the Architect

of the Capitol, $43,689,000, of which $3,843,000 shall remain available until expended: Provided, That notwithstanding any other

provision of law, such amount shall be available for the position

of Project Manager for the Capitol Visitor Center, at a rate of

compensation which does not exceed the rate of basic pay payable

for level ES–2 of the Senior Executive Service, as established under

subchapter VIII of chapter 53 of title 5, United States Code (taking

into account any comparability payments made under section

5304(h) of such title): Provided further, That effective on the date

of the enactment of this Act, any amount made available under

this heading under the Legislative Branch Appropriations Act, 2000,

shall be available for such position at such rate of compensation.

CAPITOL GROUNDS

For all necessary expenses for care and improvement of grounds

surrounding the Capitol, the Senate and House office buildings,

and the Capitol Power Plant, $5,362,000, of which $125,000 shall

remain available until expended.

SENATE OFFICE BUILDINGS

For all necessary expenses for the maintenance, care and operation of Senate office buildings; and furniture and furnishings to

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–109

be expended under the control and supervision of the Architect

of the Capitol, $63,974,000, of which $21,669,000 shall remain

available until expended.

HOUSE OFFICE BUILDINGS

For all necessary expenses for the maintenance, care and oper- ation of the House office buildings, $32,750,000, of which $123,000

shall remain available until expended.

CAPITOL POWER PLANT

For all necessary expenses for the maintenance, care and operation of the Capitol Power Plant; lighting, heating, power (including

the purchase of electrical energy) and water and sewer services

for the Capitol, Senate and House office buildings, Library of Congress buildings, and the grounds about the same, Botanic Garden,

Senate garage, and air conditioning refrigeration not supplied from

plants in any of such buildings; heating the Government Printing

Office and Washington City Post Office, and heating and chilled

water for air conditioning for the Supreme Court Building, the

Union Station complex, the Thurgood Marshall Federal Judiciary

Building and the Folger Shakespeare Library, expenses for which

shall be advanced or reimbursed upon request of the Architect

of the Capitol and amounts so received shall be deposited into

the Treasury to the credit of this appropriation, $39,415,000, of

which $523,000 shall remain available until expended: Provided, That not more than $4,400,000 of the funds credited or to be

reimbursed to this appropriation as herein provided shall be available for obligation during fiscal year 2001.

LIBRARY OF CONGRESS

CONGRESSIONAL RESEARCH SERVICE

SALARIES AND EXPENSES

For necessary expenses to carry out the provisions of section

203 of the Legislative Reorganization Act of 1946 (2 U.S.C. 166)

and to revise and extend the Annotated Constitution of the United

States of America, $73,592,000: Provided, That no part of such

amount may be used to pay any salary or expense in connection

with any publication, or preparation of material therefor (except

the Digest of Public General Bills), to be issued by the Library

of Congress unless such publication has obtained prior approval

of either the Committee on House Administration of the House

of Representatives or the Committee on Rules and Administration

of the Senate.

GOVERNMENT PRINTING OFFICE

CONGRESSIONAL PRINTING AND BINDING

(INCLUDING TRANSFER OF FUNDS)

For authorized printing and binding for the Congress and the

distribution of Congressional information in any format; printing

and binding for the Architect of the Capitol; expenses necessary

114 STAT. 2763A–110 PUBLIC LAW 106–554—APPENDIX B

for preparing the semimonthly and session index to the Congressional Record, as authorized by law (44 U.S.C. 902); printing and

binding of Government publications authorized by law to be distributed to Members of Congress; and printing, binding, and distribution of Government publications authorized by law to be distributed

without charge to the recipient, $71,462,000: Provided, That this

appropriation shall not be available for paper copies of the permanent edition of the Congressional Record for individual Representatives, Resident Commissioners or Delegates authorized under 44

U.S.C. 906: Provided further, That this appropriation shall be available for the payment of obligations incurred under the appropriations for similar purposes for preceding fiscal years: Provided further, That notwithstanding the 2-year limitation under section 718

of title 44, United States Code, none of the funds appropriated

or made available under this Act or any other Act for printing

and binding and related services provided to Congress under chapter 7 of title 44, United States Code, may be expended to print

a document, report, or publication after the 27-month period beginning on the date that such document, report, or publication is

authorized by Congress to be printed, unless Congress reauthorizes

such printing in accordance with section 718 of title 44, United

States Code: Provided further, That any unobligated or unexpended

balances in this account or accounts for similar purposes for preceding fiscal years may be transferred to the Government Printing

Office revolving fund for carrying out the purposes of this heading,

subject to the approval of the Committees on Appropriations of

the House of Representatives and Senate.

ADMINISTRATIVE PROVISION

SEC. 111. (a) CONGRESSIONAL PRINTING AND BINDING FOR THE

HOUSE THROUGH CLERK OF HOUSE.—

(1) IN GENERAL.—Notwithstanding any provision of title

44, United States Code, or any other law, there are authorized

to be appropriated to the Clerk of the House of Representatives

such sums as may be necessary for congressional printing and

binding services for the House of Representatives.

(2) PREPARATION OF ESTIMATES.—Estimated expenditures

and proposed appropriations for congressional printing and

binding services shall be prepared and submitted by the Clerk

of the House of Representatives in accordance with title 31,

United States Code, in the same manner as estimates and

requests are prepared for other legislative branch services

under such title, except that such requests shall be based

upon the results of the study conducted under subsection (b)

(with respect to any fiscal year covered by such study).

(3) EFFECTIVE DATE.—This subsection shall apply with

respect to fiscal year 2003 and each succeeding fiscal year.

(b) STUDY.—

(1) IN GENERAL.—During fiscal year 2001, the Clerk of

the House of Representatives shall conduct a comprehensive

study of the needs of the House for congressional printing

and binding services during fiscal year 2003 and succeeding

fiscal years (including transitional issues during fiscal year

2002), and shall include in the study an analysis of the most

cost-effective program or programs for providing printed or

other media-based publications for House uses.

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–111

(2) SUBMISSION TO COMMITTEES.—The Clerk shall submit

the study conducted under paragraph (1) to the Committee

on House Administration of the House of Representatives, who

shall review the study and prepare such regulations or other

materials (including proposals for legislation) as it considers

appropriate to enable the Clerk to carry out congressional printing and binding services for the House in accordance with

this section.

(c) DEFINITION.—In this section, the term ‘‘congressional printing and binding services’’ means the following services:

(1) Authorized printing and binding for the Congress and

the distribution of congressional information in any format.

(2) Preparing the semimonthly and session index to the

Congressional Record.

(3) Printing and binding of Government publications

authorized by law to be distributed to Members of Congress.

(4) Printing, binding, and distribution of Government

publications authorized by law to be distributed without charge

to the recipient.

This title may be cited as the ‘‘Congressional Operations Appropriations Act, 2001’’.

TITLE II—OTHER AGENCIES

BOTANIC GARDEN

SALARIES AND EXPENSES

For all necessary expenses for the maintenance, care and operation of the Botanic Garden and the nurseries, buildings, grounds,

and collections; and purchase and exchange, maintenance, repair,

and operation of a passenger motor vehicle; all under the direction

of the Joint Committee on the Library, $3,328,000, of which $25,000

shall remain available until expended.

LIBRARY OF CONGRESS

SALARIES AND EXPENSES

For necessary expenses of the Library of Congress not otherwise

provided for, including development and maintenance of the Union

Catalogs; custody and custodial care of the Library buildings; special

clothing; cleaning, laundering and repair of uniforms; preservation

of motion pictures in the custody of the Library; operation and

maintenance of the American Folklife Center in the Library;

preparation and distribution of catalog records and other publications of the Library; hire or purchase of one passenger motor

vehicle; and expenses of the Library of Congress Trust Fund Board

not properly chargeable to the income of any trust fund held by

the Board, $282,838,000, of which not more than $6,500,000 shall

be derived from collections credited to this appropriation during

fiscal year 2001, and shall remain available until expended, under

the Act of June 28, 1902 (chapter 1301; 32 Stat. 480; 2 U.S.C.

150) and not more than $350,000 shall be derived from collections

during fiscal year 2001 and shall remain available until expended

for the development and maintenance of an international legal

information database and activities related thereto: Provided, That

the Library of Congress may not obligate or expend any funds

114 STAT. 2763A–112 PUBLIC LAW 106–554—APPENDIX B

derived from collections under the Act of June 28, 1902, in excess

of the amount authorized for obligation or expenditure in appropriations Acts: Provided further, That the total amount available for

obligation shall be reduced by the amount by which collections

are less than the $6,850,000: Provided further, That of the total

amount appropriated, $10,459,575 is to remain available until

expended for acquisition of books, periodicals, newspapers, and

all other materials including subscriptions for bibliographic services

for the Library, including $40,000 to be available solely for the

purchase, when specifically approved by the Librarian, of special

and unique materials for additions to the collections: Provided

further, That of the total amount appropriated, $2,506,000 is to

remain available until expended for the acquisition and partial

support for implementation of an Integrated Library System (ILS):

Provided further, That of the total amount appropriated,

$10,000,000 is to remain available until expended for salaries and

expenses to carry out the Russian Leadership Program enacted

on May 21, 1999 (113 Stat. 93 et seq.): Provided further, That

of the total amount appropriated, $5,957,800 is to remain available

until expended for the purpose of teaching educators how to incorporate the Library’s digital collections into school curricula, which

amount shall be transferred to the educational consortium formed

to conduct the ‘‘Joining Hands Across America: Local Community

Initiative’’ project as approved by the Library: Provided further,

That of the total amount appropriated, $404,000 is to remain available until expended for a collaborative digitization and telecommunications project with the United States Military Academy

and any remaining balance is available for other Library purposes:

Provided further, That of the total amount appropriated, $4,300,000

is to remain available until expended for the purpose of developing

a high speed data transmission between the Library of Congress

and educational facilities, libraries, or networks serving western

North Carolina, and any remaining balance is available for support

of the Library’s Digital Futures initiative.

COPYRIGHT OFFICE

SALARIES AND EXPENSES

For necessary expenses of the Copyright Office, $38,523,000,

of which not more than $23,500,000, to remain available until

expended, shall be derived from collections credited to this appropriation during fiscal year 2001 under 17 U.S.C. 708(d): Provided,

That the Copyright Office may not obligate or expend any funds

derived from collections under 17 U.S.C. 708(d), in excess of the

amount authorized for obligation or expenditure in appropriations

Acts: Provided further, That not more than $5,783,000 shall be

derived from collections during fiscal year 2001 under 17 U.S.C.

111(d)(2), 119(b)(2), 802(h), and 1005: Provided further, That the

total amount available for obligation shall be reduced by the amount

by which collections are less than $29,283,000: Provided further,

That not more than $100,000 of the amount appropriated is available for the maintenance of an ‘‘International Copyright Institute’’

in the Copyright Office of the Library of Congress for the purpose

of training nationals of developing countries in intellectual property

laws and policies: Provided further, That not more than $4,250

may be expended, on the certification of the Librarian of Congress,

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–113

in connection with official representation and reception expenses

for activities of the International Copyright Institute and for copyright delegations, visitors, and seminars.

BOOKS FOR THE BLIND AND PHYSICALLY HANDICAPPED

SALARIES AND EXPENSES

For salaries and expenses to carry out the Act of March 3, 1931 (chapter 400; 46 Stat. 1487; 2 U.S.C. 135a), $48,609,000,

of which $14,154,000 shall remain available until expended.

FURNITURE AND FURNISHINGS

For necessary expenses for the purchase, installation, maintenance, and repair of furniture, furnishings, office and library equipment, $4,892,000.

ADMINISTRATIVE PROVISIONS

SEC. 201. Appropriations in this Act available to the Library

of Congress shall be available, in an amount of not more than

$199,630, of which $59,300 is for the Congressional Research Service, when specifically authorized by the Librarian of Congress,

for attendance at meetings concerned with the function or activity

for which the appropriation is made.

SEC. 202. (a) No part of the funds appropriated in this Act

shall be used by the Library of Congress to administer any flexible

or compressed work schedule which—

(1) applies to any manager or supervisor in a position

the grade or level of which is equal to or higher than GS–

15; and

(2) grants such manager or supervisor the right to not

be at work for all or a portion of a workday because of time

worked by the manager or supervisor on another workday.

(b) For purposes of this section, the term ‘‘manager or supervisor’’ means any management official or supervisor, as such terms

are defined in section 7103(a)(10) and (11) of title 5, United States

Code.

SEC. 203. Appropriated funds received by the Library of Congress from other Federal agencies to cover general and administrative overhead costs generated by performing reimbursable work

for other agencies under the authority of sections 1535 and 1536

of title 31, United States Code, shall not be used to employ more

than 65 employees and may be expended or obligated—

(1) in the case of a reimbursement, only to such extent

or in such amounts as are provided in appropriations Acts;

or

(2) in the case of an advance payment, only—

(A) to pay for such general or administrative overhead

costs as are attributable to the work performed for such

agency; or

(B) to such extent or in such amounts as are provided

in appropriations Acts, with respect to any purpose not

allowable under subparagraph (A).

SEC. 204. Of the amounts appropriated to the Library of Con- gress in this Act, not more than $5,000 may be expended, on

the certification of the Librarian of Congress, in connection with

114 STAT. 2763A–114 PUBLIC LAW 106–554—APPENDIX B

official representation and reception expenses for the incentive

awards program.

SEC. 205. Of the amount appropriated to the Library of Congress in this Act, not more than $12,000 may be expended, on

the certification of the Librarian of Congress, in connection with

official representation and reception expenses for the Overseas Field

Offices.

SEC. 206. (a) For fiscal year 2001, the obligational authority

of the Library of Congress for the activities described in subsection

(b) may not exceed $92,845,000.

(b) The activities referred to in subsection (a) are reimbursable

and revolving fund activities that are funded from sources other

than appropriations to the Library in appropriations Acts for the

legislative branch.

SEC. 207. Section 1 of the Act entitled ‘‘An Act to authorize

acquisition of certain real property for the Library of Congress,

and for other purposes’’, approved December 15, 1997 (2 U.S.C.

141 note) is amended by adding at the end the following new

subsection: ‘‘(c) TRANSFER PAYMENT BY ARCHITECT.—Notwithstanding the

limitation on reimbursement or transfer of funds under subsection

(a) of this section, the Architect of the Capitol may, not later

than 90 days after acquisition of the property under this section,

transfer funds to the entity from which the property was acquired

by the Architect of the Capitol. Such transfers may not exceed

a total of $16,500,000.’’.

SEC. 208. The Librarian of Congress may convert to permanent

positions 84 indefinite, time-limited positions in the National Digital

Library Program authorized in the Legislative Branch Appropriations Act, 1996 for the Library of Congress under the heading,

‘‘Salaries and Expenses’’ (Public Law 104–53). Notwithstanding any

other provision of law regarding qualifications and methods of

appointment of employees of the Library of Congress, the Librarian

may fill these permanent positions through the non-competitive

conversion of the incumbents in the ‘‘indefinite-not-to-exceed’’ positions to ‘‘permanent’’ positions.

SEC. 209. (a) In addition to any other transfer authority provided by law, during fiscal year 2001 and fiscal years thereafter,

the Librarian of Congress may transfer to and among available

accounts of the Library of Congress amounts appropriated to the

Librarian from funds for the purchase, installation, maintenance,

and repair of furniture, furnishings, and office and library equipment.

(b) Any amounts transferred pursuant to subsection (a) shall

be merged with and be available for the same purpose and for

the same period as the appropriation or account to which such

amounts are transferred.

(c) The Librarian may transfer amounts pursuant to subsection

(a) only with the approval of the Committees on Appropriations

of the House of Representatives and Senate.

SEC. 210. (a)(1) This subsection shall apply to any individual

who—

(A) is employed by the Library of Congress Child Development Center (known as the ‘‘Little Scholars Child Development

Center’’, in this section referred to as the ‘‘Center’’) established

under section 205(g)(1) of the Legislative Branch Appropriations

Act, 1991; and

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–115

(B) makes an election to be covered by this subsection

with the Librarian of Congress, not later than the later of—

(i) 60 days after the date of enactment of this Act;

or

(ii) 60 days after the date the individual begins such

employment.

(2)(A) Any individual described under paragraph (1) may be

credited, under section 8411 of title 5, United States Code, for

service as an employee of the Center before the date of enactment

of this Act, if such employee makes a payment of the deposit

under section 8411(f )(2) of such title without application of section

8411(b)(3) of such title.

(B) An individual described under paragraph (1) shall be credited under section 8411 of title 5, United States Code, for any

service as an employee of the Center on or after the date of enactment of this Act, if such employee has such amounts deducted

and withheld from his pay as determined by the Office of Personnel

Management which would be deducted and withheld from the basic

pay of an employee under section 8422 of title 5, United States

Code.

(3) Notwithstanding any other provision of this subsection,

any service performed by an individual described under paragraph

(1) as an employee of the Center is deemed to be civilian service

creditable under section 8411 of title 5, United States Code, for

purposes of qualifying for survivor annuities and disability benefits

under subchapters IV and V of chapter 84 of such title, if such

individual makes payment of an amount, determined by the Office

of Personnel Management, which would have been deducted and

withheld from the basic pay of such individual if such individual

had been an employee subject to section 8422 of title 5, United

States Code, for such period so credited, together with interest

thereon.

(4) An individual described under paragraph (1) shall be deemed

an employee for purposes of chapter 84 of title 5, United States

Code, including subchapter III of such title, and may make contributions under section 8432 of such title effective for the first applicable

pay period beginning on or after the date such individual elects

coverage under this section.

(5) The Office of Personnel Management shall accept the certification of the Librarian of Congress concerning creditable service

for purposes of this subsection.

(b) Any individual who is employed by the Center on or after

the date of enactment of this Act shall be deemed an employee

under section 8901(1) of title 5, United States Code, for purposes

of health insurance coverage under chapter 89 of such title. An

individual who is an employee of the Center on the date of enactment of this Act may elect coverage under this subsection before

the 60th day after the date of enactment of this Act, and during

such periods as determined by the Office of Personnel Management

for employees of the Center employed after such date.

(c) An individual who is employed by the Center shall be

deemed an employee under section 8701(a) of title 5, United States

Code, for purposes of life insurance coverage under chapter 87

of such title.

(d) Government contributions for individuals receiving benefits

under this section, as computed under sections 8423, 8432, 8708,

114 STAT. 2763A–116 PUBLIC LAW 106–554—APPENDIX B

and 8906 shall be made by the Librarian of Congress from any

appropriations available to the Library of Congress.

(e) The Library of Congress, directly or by agreement with

its designated representative, shall—

(1) process payroll for Center employees, including making

deductions and withholdings from the pay of employees in

the amounts determined under sections 8422, 8432, 8707, and

8905 of title 5, United States Code;

(2) maintain appropriate personnel and payroll records for

Center employees, and transmit appropriate information and

records to the Office of Personnel Management; and

(3) transmit funds for Government and employee contributions under this section to the Office of Personnel Management.

(f ) The Center shall—

(1) pay to the Library of Congress funds sufficient to cover

the gross salary and the employer’s share of taxes under section

3111 of the Internal Revenue Code of 1986 for Center employees, in amounts computed by the Library of Congress;

(2) as required by the Library of Congress, reimburse the

Library of Congress for reasonable administrative costs

incurred under subsection (e)(1);

(3) comply with regulations and procedures prescribed by

the Librarian of Congress for administration of this section;

(4) maintain appropriate records on all Center employees,

as required by the Librarian of Congress; and

(5) consult with the Librarian of Congress on the administration and implementation of this section.

(g) The Librarian of Congress may prescribe regulations to

carry out this section.

ARCHITECT OF THE CAPITOL

LIBRARY BUILDINGS AND GROUNDS

STRUCTURAL AND MECHANICAL CARE

For all necessary expenses for the mechanical and structural

maintenance, care and operation of the Library buildings and

grounds, $15,970,000, of which $5,000,000 shall remain available

until expended.

GOVERNMENT PRINTING OFFICE

OFFICE OF SUPERINTENDENT OF DOCUMENTS

SALARIES AND EXPENSES

(INCLUDING TRANSFER OF FUNDS)

For expenses of the Office of Superintendent of Documents

necessary to provide for the cataloging and indexing of Government

publications and their distribution to the public, Members of Congress, other Government agencies, and designated depository and

international exchange libraries as authorized by law, $27,954,000:

Provided, That travel expenses, including travel expenses of the

Depository Library Council to the Public Printer, shall not exceed

$175,000: Provided further, That amounts of not more than

$2,000,000 from current year appropriations are authorized for

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–117

producing and disseminating Congressional serial sets and other

related publications for 1999 and 2000 to depository and other

designated libraries: Provided further, That any unobligated or

unexpended balances in this account or accounts for similar purposes for preceding fiscal years may be transferred to the Government Printing Office revolving fund for carrying out the purposes

of this heading, subject to the approval of the Committees on

Appropriations of the House of Representatives and Senate.

GOVERNMENT PRINTING OFFICE REVOLVING FUND

The Government Printing Office is hereby authorized to make

such expenditures, within the limits of funds available and in

accord with the law, and to make such contracts and commitments

without regard to fiscal year limitations as provided by section

9104 of title 31, United States Code, as may be necessary in

carrying out the programs and purposes set forth in the budget

for the current fiscal year for the Government Printing Office revolving fund: Provided, That not more than $2,500 may be expended

on the certification of the Public Printer in connection with official

representation and reception expenses: Provided further, That the

revolving fund shall be available for the hire or purchase of not

more than 12 passenger motor vehicles: Provided further, That

expenditures in connection with travel expenses of the advisory

councils to the Public Printer shall be deemed necessary to carry

out the provisions of title 44, United States Code: Provided further, That the revolving fund shall be available for temporary or intermittent services under section 3109(b) of title 5, United States Code,

but at rates for individuals not more than the daily equivalent

of the annual rate of basic pay for level V of the Executive Schedule

under section 5316 of such title: Provided further, That the revolving

fund and the funds provided under the headings ‘‘OFFICE OF SUPER- INTENDENT OF DOCUMENTS’’ and ‘‘SALARIES AND EXPENSES’’ together

may not be available for the full-time equivalent employment of

more than 3,285 workyears (or such other number of workyears

as the Public Printer may request, subject to the approval of the

Committees on Appropriations of the Senate and the House of

Representatives): Provided further, That activities financed through

the revolving fund may provide information in any format: Provided

further, That the revolving fund shall not be used to administer

any flexible or compressed work schedule which applies to any

manager or supervisor in a position the grade or level of which

is equal to or higher than GS–15: Provided further, That expenses

for attendance at meetings shall not exceed $75,000.

GENERAL ACCOUNTING OFFICE

SALARIES AND EXPENSES

For necessary expenses of the General Accounting Office,

including not more than $10,000 to be expended on the certification

of the Comptroller General of the United States in connection

with official representation and reception expenses; temporary or

intermittent services under section 3109(b) of title 5, United States

Code, but at rates for individuals not more than the daily equivalent

of the annual rate of basic pay for level IV of the Executive Schedule

under section 5315 of such title; hire of one passenger motor vehicle;

advance payments in foreign countries in accordance with section

114 STAT. 2763A–118 PUBLIC LAW 106–554—APPENDIX B

3324 of title 31, United States Code; benefits comparable to those

payable under sections 901(5), 901(6), and 901(8) of the Foreign

Service Act of 1980 (22 U.S.C. 4081(5), 4081(6), and 4081(8)); and

under regulations prescribed by the Comptroller General of the

United States, rental of living quarters in foreign countries,

$384,867,000: Provided, That not more than $1,900,000 of payments

received under 31 U.S.C. 782 shall be available for use in fiscal

year 2001: Provided further, That not more than $1,100,000 of

reimbursements received under 31 U.S.C. 9105 shall be available

for use in fiscal year 2001: Provided further, That this appropriation

and appropriations for administrative expenses of any other department or agency which is a member of the National Intergovernmental Audit Forum or a Regional Intergovernmental Audit Forum

shall be available to finance an appropriate share of either Forum’s

costs as determined by the respective Forum, including necessary

travel expenses of non-Federal participants. Payments hereunder

to the Forum may be credited as reimbursements to any appropriation from which costs involved are initially financed: Provided further, That this appropriation and appropriations for administrative

expenses of any other department or agency which is a member

of the American Consortium on International Public Administration

(ACIPA) shall be available to finance an appropriate share of ACIPA

costs as determined by the ACIPA, including any expenses attributable to membership of ACIPA in the International Institute of

Administrative Sciences.

TITLE III—GENERAL PROVISIONS

SEC. 301. No part of the funds appropriated in this Act shall

be used for the maintenance or care of private vehicles, except

for emergency assistance and cleaning as may be provided under

regulations relating to parking facilities for the House of Representatives issued by the Committee on House Administration and for

the Senate issued by the Committee on Rules and Administration.

SEC. 302. No part of the funds appropriated in this Act shall

remain available for obligation beyond fiscal year 2001 unless

expressly so provided in this Act.

SEC. 303. Whenever in this Act any office or position not specifically established by the Legislative Pay Act of 1929 is appropriated

for or the rate of compensation or designation of any office or

position appropriated for is different from that specifically established by such Act, the rate of compensation and the designation

in this Act shall be the permanent law with respect thereto: Provided, That the provisions in this Act for the various items of

official expenses of Members, officers, and committees of the Senate

and House of Representatives, and clerk hire for Senators and

Members of the House of Representatives shall be the permanent

law with respect thereto.

SEC. 304. The expenditure of any appropriation under this

Act for any consulting service through procurement contract, pursuant to section 3109 of title 5, United States Code, shall be limited

to those contracts where such expenditures are a matter of public

record and available for public inspection, except where otherwise

provided under existing law, or under existing Executive order

issued pursuant to existing law.

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–119

SEC. 305. (a) It is the sense of the Congress that, to the

greatest extent practicable, all equipment and products purchased

with funds made available in this Act should be American-made.

(b) In providing financial assistance to, or entering into any

contract with, any entity using funds made available in this Act,

the head of each Federal agency, to the greatest extent practicable,

shall provide to such entity a notice describing the statement made

in subsection (a) by the Congress.

(c) If it has been finally determined by a court or Federal

agency that any person intentionally affixed a label bearing a

‘‘Made in America’’ inscription, or any inscription with the same

meaning, to any product sold in or shipped to the United States

that is not made in the United States, such person shall be ineligible

to receive any contract or subcontract made with funds provided

pursuant to this Act, pursuant to the debarment, suspension, and

ineligibility procedures described in section 9.400 through 9.409

of title 48, Code of Federal Regulations.

SEC. 306. Such sums as may be necessary are appropriated

to the account described in subsection (a) of section 415 of Public

Law 104–1 to pay awards and settlements as authorized under

such subsection.

SEC. 307. Amounts available for administrative expenses of

any legislative branch entity which participates in the Legislative

Branch Financial Managers Council (LBFMC) established by charter on March 26, 1996, shall be available to finance an appropriate

share of LBFMC costs as determined by the LBFMC, except that

the total LBFMC costs to be shared among all participating legislative branch entities (in such allocations among the entities as

the entities may determine) may not exceed $252,000.

SEC. 308. No part of any appropriation contained in this Act

under the heading ‘‘Architect of the Capitol’’ or ‘‘Botanic Garden’’

shall be obligated or expended for a construction contract in excess

of $100,000, unless such contract includes a provision that requires

liquidated damages for contractor caused delay in an amount

commensurate with the daily net usable square foot cost of leasing

similar space in a first class office building within two miles of

the United States Capitol multiplied by the square footage to be

constructed under the contract.

SEC. 309. Section 316 of Public Law 101–302 is amended in

the first sentence of subsection (a) by striking ‘‘2000’’ and inserting

‘‘2001’’.

SEC. 310. RUSSIAN LEADERSHIP PROGRAM. Section 3011 of the

1999 Emergency Supplemental Appropriations Act (Public Law 106–

31; 113 Stat. 93) is amended—

(1) by striking ‘‘fiscal years 1999 and 2000’’ in subsections

(a)(1), (b)(4)(B), (d)(3), and (h)(1)(A) and inserting ‘‘fiscal years

2000 and 2001’’; and

(2) by striking ‘‘2001’’ in subsection (a)(2), (e)(1), and

(h)(1)(B) and inserting ‘‘2002’’.

SEC. 311. (a)(1) Any State may request the Joint Committee

on the Library of Congress to approve the replacement of a statue

the State has provided for display in Statuary Hall in the Capitol

of the United States under section 1814 of the Revised Statutes

(40 U.S.C. 187).

(2) A request shall be considered under paragraph (1) only

if—

114 STAT. 2763A–120 PUBLIC LAW 106–554—APPENDIX B

(A) the request has been approved by a resolution adopted

by the legislature of the State and the request has been

approved by the Governor of the State, and

(B) the statue to be replaced has been displayed in the

Capitol of the United States for at least 10 years as of the

time the request is made, except that the Joint Committee

may waive this requirement for cause at the request of a

State.

(b) If the Joint Committee on the Library of Congress approves

a request under subsection (a), the Architect of the Capitol shall

enter into an agreement with the State to carry out the replacement

in accordance with the request and any conditions the Joint

Committee may require for its approval. Such agreement shall

provide that—

(1) the new statue shall be subject to the same conditions

and restrictions as apply to any statue provided by a State

under section 1814 of the Revised Statutes (40 U.S.C. 187),

and

(2) the State shall pay any costs related to the replacement,

including costs in connection with the design, construction,

transportation, and placement of the new statue, the removal

and transportation of the statue being replaced, and any unveiling ceremony.

(c) Nothing in this section shall be interpreted to permit a

State to have more than two statues on display in the Capitol

of the United States.

(d)(1) Subject to the approval of the Joint Committee on the

Library, ownership of any statue replaced under this section shall

be transferred to the State.

(2) If any statue is removed from the Capitol of the United

States as part of a transfer of ownership under paragraph (1),

then it may not be returned to the Capitol for display unless

such display is specifically authorized by Federal law.

(e) The Architect of the Capitol, upon the approval of the

Joint Committee on the Library and with the advice of the Commission of Fine Arts as requested, is authorized and directed to relocate

within the United States Capitol any of the statues received from

the States under section 1814 of the Revised Statutes (40 U.S.C.

187) prior to the date of the enactment of this Act, and to provide

for the reception, location, and relocation of the statues received

hereafter from the States under such section.

SEC. 312. (a) Section 201 of the Legislative Branch Appropriations Act, 1993 (40 U.S.C. 216c note) is amended by striking

‘‘$10,000,000’’ each place it appears and inserting ‘‘$14,500,000’’.

(b) Section 201 of such Act is amended—

(1) by inserting ‘‘(a)’’ before ‘‘Pursuant’’, and

(2) by adding at the end the following:

‘‘(b) The Architect of the Capitol is authorized to solicit, receive,

accept, and hold amounts under section 307E(a)(2) of the Legislative

Branch Appropriations Act, 1989 (40 U.S.C. 216c(a)(2)) in excess

of the $14,500,000 authorized under subsection (a), but such

amounts (and any interest thereon) shall not be expended by the

Architect without approval in appropriation Acts as required under

section 307E(b)(3) of such Act (40 U.S.C. 216c(b)(3)).’’.

SEC. 313. CENTER FOR RUSSIAN LEADERSHIP DEVELOPMENT.

(a) ESTABLISHMENT.—

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–121

(1) IN GENERAL.—There is established in the legislative

branch of the Government a center to be known as the ‘‘Center

for Russian Leadership Development’’ (the ‘‘Center’’).

(2) BOARD OF TRUSTEES.—The Center shall be subject to

the supervision and direction of a Board of Trustees which

shall be composed of nine members as follows:

(A) Two members appointed by the Speaker of the

House of Representatives, one of whom shall be designated

by the Majority Leader of the House of Representatives

and one of whom shall be designated by the Minority

Leader of the House of Representatives.

(B) Two members appointed by the President pro tempore of the Senate, one of whom shall be designated by

the Majority Leader of the Senate and one of whom shall

be designated by the Minority Leader of the Senate.

(C) The Librarian of Congress.

(D) Four private individuals with interests in improving United States and Russian relations, designated by

the Librarian of Congress.

Each member appointed under this paragraph shall serve for

a term of 3 years. Any vacancy shall be filled in the same

manner as the original appointment and the individual so

appointed shall serve for the remainder of the term. Members

of the Board shall serve without pay, but shall be entitled

to reimbursement for travel, subsistence, and other necessary

expenses incurred in the performance of their duties.

(b) PURPOSE AND AUTHORITY OF THE CENTER.—

(1) PURPOSE.—The purpose of the Center is to establish,

in accordance with the provisions of paragraph (2), a program

to enable emerging political leaders of Russia at all levels

of government to gain significant, firsthand exposure to the

American free market economic system and the operation of

American democratic institutions through visits to governments

and communities at comparable levels in the United States.

(2) GRANT PROGRAM.—Subject to the provisions of paragraphs (3) and (4), the Center shall establish a program under

which the Center annually awards grants to government or

community organizations in the United States that seek to

establish programs under which those organizations will host

Russian nationals who are emerging political leaders at any

level of government.

(3) RESTRICTIONS.—

(A) DURATION.—The period of stay in the United States

for any individual supported with grant funds under the

program shall not exceed 30 days.

(B) LIMITATION.—The number of individuals supported

with grant funds under the program shall not exceed 3,000

in any fiscal year.

(C) USE OF FUNDS.—Grant funds under the program

shall be used to pay—

(i) the costs and expenses incurred by each program participant in traveling between Russia and the

United States and in traveling within the United

States;

(ii) the costs of providing lodging in the United

States to each program participant, whether in public

accommodations or in private homes; and

114 STAT. 2763A–122 PUBLIC LAW 106–554—APPENDIX B

(iii) such additional administrative expenses

incurred by organizations in carrying out the program

as the Center may prescribe.

(4) APPLICATION.— (A) IN GENERAL.—Each organization in the United

States desiring a grant under this section shall submit

an application to the Center at such time, in such manner,

and accompanied by such information as the Center may

reasonably require.

(B) CONTENTS.—Each application submitted pursuant

to subparagraph (A) shall— (i) describe the activities for which assistance

under this section is sought;

(ii) include the number of program participants

to be supported;

(iii) describe the qualifications of the individuals

who will be participating in the program; and

(iv) provide such additional assurances as the Center determines to be essential to ensure compliance

with the requirements of this section.

(c) ESTABLISHMENT OF FUND.—

(1) IN GENERAL.—There is established in the Treasury of

the United States a trust fund to be known as the ‘‘Russian

Leadership Development Center Trust Fund’’ (the ‘‘Fund’’)

which shall consist of amounts which may be appropriated,

credited, or transferred to it under this section.

(2) DONATIONS.—Any money or other property donated,

bequeathed, or devised to the Center under the authority of

this section shall be credited to the Fund.

(3) FUND MANAGEMENT.—

(A) IN GENERAL.—The provisions of subsections (b),

(c), and (d) of section 116 of the Legislative Branch Appropriations Act, 1989 (2 U.S.C. 1105 (b), (c), and (d)), and

the provisions of section 117(b) of such Act (2 U.S.C.

1106(b)), shall apply to the Fund.

(B) EXPENDITURES.—The Secretary of the Treasury is

authorized to pay to the Center from amounts in the Fund

such sums as the Board of Trustees of the Center determines are necessary and appropriate to enable the Center

to carry out the provisions of this section.

(d) EXECUTIVE DIRECTOR.—The Board shall appoint an Executive Director who shall be the chief executive officer of the Center

and who shall carry out the functions of the Center subject to

the supervision and direction of the Board of Trustees. The Executive Director of the Center shall be compensated at the annual

rate specified by the Board, but in no event shall such rate exceed

level III of the Executive Schedule under section 5314 of title

5, United States Code.

(e) ADMINISTRATIVE PROVISIONS.—

(1) IN GENERAL.—The provisions of section 119 of the Legislative Branch Appropriations Act, 1989 (2 U.S.C. 1108) shall

apply to the Center.

(2) SUPPORT PROVIDED BY LIBRARY OF CONGRESS.—The

Library of Congress may disburse funds appropriated to the

Center, compute and disburse the basic pay for all personnel

of the Center, provide administrative, legal, financial management, and other appropriate services to the Center, and collect

PUBLIC LAW 106–554—APPENDIX B 114 STAT. 2763A–123

from the Fund the full costs of providing services under this

paragraph, as provided under an agreement for services ordered

under sections 1535 and 1536 of title 31, United States Code.

(f ) AUTHORIZATION OF APPROPRIATIONS.—There are authorized

to be appropriated such sums as may be necessary to carry out

this section.

(g) TRANSFER OF FUNDS.—Any amounts appropriated for use

in the program established under section 3011 of the 1999 Emergency Supplemental Appropriations Act (Public Law 106–31; 113

Stat. 93) shall be transferred to the Fund and shall remain available

without fiscal year limitation.

(h) EFFECTIVE DATES.— (1) IN GENERAL.—This section shall take effect on the date

of enactment of this Act.

(2) TRANSFER.—Subsection (g) shall only apply to amounts

which remain unexpended on and after the date the Board

of Trustees of the Center certifies to the Librarian of Congress

that grants are ready to be made under the program established

under this section.

SEC. 314. REVIEW OF PROPOSED CHANGES TO EXPORT THRESH- OLDS FOR COMPUTERS. Not more than 50 days after the date of

the submission of the report referred to in subsection (d) of section

1211 of the National Defense Authorization Act for Fiscal Year

1998 (50 U.S.C. App. 2404 note), the Comptroller General of the

United States shall submit an assessment to Congress which contains an analysis of the new computer performance levels being

proposed by the President under such section.

TITLE IV—EMERGENCY FISCAL YEAR 2000 SUPPLEMENTAL

APPROPRIATIONS

The following sums are appropriated out of any money in

the Treasury not otherwise appropriated, to provide additional

emergency supplemental appropriations for the Legislative Branch

for the fiscal year ending September 30, 2000, and for other purposes, namely:

CAPITOL POLICE BOARD

SECURITY ENHANCEMENTS

For an additional amount for the Capitol Police Board for

costs associated with security enhancements, under the terms and

conditions of chapter 5 of title II of division B of the Omnibus

Consolidated and Emergency Supplemental Appropriations Act,

1999 (Public Law 105–277), $2,102,000, to remain available until

expended, of which—

(1) $228,000 shall be for the acquisition and installation

of card readers for four additional access points which are

not currently funded under the implementation of the security

enhancement plan; and

(2) $1,874,000 shall be for security enhancements to the

buildings and grounds of the Library of Congress:

Provided, That the entire amount is designated by Congress as

an emergency requirement pursuant to section 251(b)(2)(A) of the

Balanced Budget and Emergency Deficit Control Act of 1985, as

amended: Provided further, That the entire amount shall be available only to the extent an official budget request for a specific

114 STAT. 2763A–124 PUBLIC LAW 106–554—APPENDIX B

dollar amount that includes designation of the entire amount of

the request as an emergency requirement as defined in the Balanced

Budget and Emergency Deficit Control Act of 1985, as amended,

is transmitted by the President to the Congress.

ARCHITECT OF THE CAPITOL

CAPITOL BUILDINGS AND GROUNDS

HOUSE OFFICE BUILDINGS

For an additional amount for necessary expenses for urgent

repairs to the underground garage in the Cannon House Office

Building, $9,000,000, to remain available until expended: Provided,

That the entire amount is designated by the Congress as an emergency requirement pursuant to section 251(b)(2)(A) of the Balanced

Budget and Emergency Deficit Control Act of 1985, as amended:

Provided further, That the entire amount shall be available only

to the extent an official budget request for a specific dollar amount

that includes designation of the entire amount of the request as

an emergency requirement as defined in the Balanced Budget and

Emergency Deficit Control Act of 1985, as amended, is transmitted

by the President to the Congress.

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

FEDERAL HOUSING ADMINISTRATION

FHA—GENERAL AND SPECIAL RISK PROGRAM ACCOUNT

For an additional amount for FHA—General and special risk

program account for the cost of guaranteed loans, as authorized

by sections 238 and 519 of the National Housing Act (12 U.S.C.

1715z–3 and 1735c), including the cost of loan modifications (as

that term is defined in section 502 of the Congressional Budget

Act of 1974, as amended), $40,000,000, to remain available until

expended: Provided, That the entire amount shall be available

only to the extent an official budget request, that includes designation of the entire amount of the request as an emergency requirement as defined in the Balanced Budget and Emergency Deficit

Control Act of 1985, as amended, is transmitted by the President

to the Congress: Provided further, That the entire amount is designated by the Congress as an emergency requirement pursuant

to section 251(b)(2)(A) of the Balanced Budget and Emergency Deficit Control Act: Provided further, That the funding under this

heading shall only be made available upon the submission of a

certification by the Secretary of Housing and Urban Development

to the Committees on Appropriations that all funds committed,

expended, or obligated under this heading in the Departments

of Veterans Affairs and Housing and Urban Development, Independent Agencies Appropriations Act, 2000 were committed, expended

or obligated in compliance with the Antideficiency Act (31 U.S.C.

1341).

SEC. 401. Appropriations made by this title are available immediately upon enactment of this Act.

This Act may be cited as the ‘‘Legislative Branch Appropriations

Act, 2001’’.

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–125

APPENDIX C—H.R. 5658

That the following sums are appropriated, out of any money in

the Treasury not otherwise appropriated, for the Treasury Department, the United States Postal Service, the Executive Office of

the President, and certain Independent Agencies for the fiscal year

ending September 30, 2001, and for other purposes, namely:

TITLE I—DEPARTMENT OF THE TREASURY

DEPARTMENTAL OFFICES

SALARIES AND EXPENSES

For necessary expenses of the Departmental Offices including

operation and maintenance of the Treasury Building and Annex;

hire of passenger motor vehicles; maintenance, repairs, and

improvements of, and purchase of commercial insurance policies

for, real properties leased or owned overseas, when necessary for

the performance of official business; not to exceed $2,900,000 for

official travel expenses; not to exceed $3,813,000, to remain available until expended for information technology modernization

requirements; not to exceed $150,000 for official reception and representation expenses; not to exceed $258,000 for unforeseen emergencies of a confidential nature, to be allocated and expended under

the direction of the Secretary of the Treasury and to be accounted

for solely on his certificate, $156,315,000: Provided, That the Office

of Foreign Assets Control shall be funded at no less than

$11,439,000: Provided further, That of these amounts $2,900,000

is available for grants to State and local law enforcement groups

to help fight money laundering.

DEPARTMENT-WIDE SYSTEMS AND CAPITAL INVESTMENTS PROGRAMS

(INCLUDING TRANSFER OF FUNDS)

For development and acquisition of automatic data processing

equipment, software, and services for the Department of the Treasury, $47,287,000, to remain available until expended: Provided,

That these funds shall be transferred to accounts and in amounts

as necessary to satisfy the requirements of the Department’s offices,

bureaus, and other organizations: Provided further, That this transfer authority shall be in addition to any other transfer authority

provided in this Act: Provided further, That none of the funds

appropriated shall be used to support or supplement the Internal

Revenue Service appropriations for Information Systems.

114 STAT. 2763A–126 PUBLIC LAW 106–554—APPENDIX C

OFFICE OF INSPECTOR GENERAL

SALARIES AND EXPENSES

For necessary expenses of the Office of Inspector General in

carrying out the provisions of the Inspector General Act of 1978,

as amended, not to exceed $2,000,000 for official travel expenses,

including hire of passenger motor vehicles; and not to exceed

$100,000 for unforeseen emergencies of a confidential nature, to

be allocated and expended under the direction of the Inspector

General of the Treasury, $32,899,000.

TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRATION

SALARIES AND EXPENSES

For necessary expenses of the Treasury Inspector General for

Tax Administration in carrying out the Inspector General Act of

1978, as amended, including purchase (not to exceed 150 for replacement only for police-type use) and hire of passenger motor vehicles

(31 U.S.C. 1343(b)); services authorized by 5 U.S.C. 3109, at such

rates as may be determined by the Inspector General for Tax

Administration; not to exceed $6,000,000 for official travel expenses;

and not to exceed $500,000 for unforeseen emergencies of a confidential nature, to be allocated and expended under the direction of

the Inspector General for Tax Administration, $118,427,000.

TREASURY BUILDING AND ANNEX REPAIR AND RESTORATION

For the repair, alteration, and improvement of the Treasury

Building and Annex, $31,000,000, to remain available until

expended.

EXPANDED ACCESS TO FINANCIAL SERVICES

(INCLUDING TRANSFER OF FUNDS)

To develop and implement programs to expand access to financial services for low- and moderate-income individuals, $2,000,000,

to remain available until expended: Provided, That of these funds,

such sums as may be necessary may be transferred to accounts

of the Department’s offices, bureaus, and other organizations: Provided further, That this transfer authority shall be in addition

to any other transfer authority provided in this Act.

FINANCIAL CRIMES ENFORCEMENT NETWORK

SALARIES AND EXPENSES

For necessary expenses of the Financial Crimes Enforcement

Network, including hire of passenger motor vehicles; travel expenses

of non-Federal law enforcement personnel to attend meetings concerned with financial intelligence activities, law enforcement, and

financial regulation; not to exceed $14,000 for official reception

and representation expenses; and for assistance to Federal law

enforcement agencies, with or without reimbursement, $37,576,000,

of which not to exceed $2,800,000 shall remain available until

September 30, 2003; and of which $2,275,000 shall remain available

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–127

until September 30, 2002: Provided, That funds appropriated in

this account may be used to procure personal services contracts.

COUNTERTERRORISM FUND

For necessary expenses, as determined by the Secretary, $55,000,000, to remain available until expended, to reimburse any

Department of the Treasury organization for the costs of providing

support to counter, investigate, or prosecute terrorism, including

payment of rewards in connection with these activities: Provided, That the entire amount is designated by the Congress as an emergency requirement pursuant to section 251(b)(2)(A) of the Balanced

Budget and Emergency Deficit Control Act of 1985, as amended:

Provided further, That the entire amount shall be available only

to the extent that an official budget request for a specific dollar

amount that includes designation of the entire amount of the

request as an emergency requirement as defined in such Act is

transmitted by the President to the Congress.

FEDERAL LAW ENFORCEMENT TRAINING CENTER

SALARIES AND EXPENSES

For necessary expenses of the Federal Law Enforcement Training Center, as a bureau of the Department of the Treasury, including materials and support costs of Federal law enforcement basic

training; purchase (not to exceed 52 for police-type use, without

regard to the general purchase price limitation) and hire of passenger motor vehicles; for expenses for student athletic and related

activities; uniforms without regard to the general purchase price

limitation for the current fiscal year; the conducting of and participating in firearms matches and presentation of awards; for public

awareness and enhancing community support of law enforcement

training; not to exceed $11,500 for official reception and representation expenses; room and board for student interns; and services

as authorized by 5 U.S.C. 3109, $94,483,000, of which up to

$17,043,000 for materials and support costs of Federal law enforcement basic training shall remain available until September 30,

2003: Provided, That the Center is authorized to accept and use

gifts of property, both real and personal, and to accept services,

for authorized purposes, including funding of a gift of intrinsic

value which shall be awarded annually by the Director of the

Center to the outstanding student who graduated from a basic

training program at the Center during the previous fiscal year,

which shall be funded only by gifts received through the Center’s

gift authority: Provided further, That notwithstanding any other

provision of law, students attending training at any Federal Law

Enforcement Training Center site shall reside in on-Center or Center-provided housing, insofar as available and in accordance with

Center policy: Provided further, That funds appropriated in this

account shall be available, at the discretion of the Director, for

the following: training United States Postal Service law enforcement

personnel and Postal police officers; State and local government

law enforcement training on a space-available basis; training of

foreign law enforcement officials on a space-available basis with

reimbursement of actual costs to this appropriation, except that

reimbursement may be waived by the Secretary for law enforcement

114 STAT. 2763A–128 PUBLIC LAW 106–554—APPENDIX C

training activities in foreign countries undertaken pursuant to section 801 of the Antiterrorism and Effective Death Penalty Act

of 1996, Public Law 104–32; training of private sector security

officials on a space-available basis with reimbursement of actual

costs to this appropriation; and travel expenses of non-Federal

personnel to attend course development meetings and training sponsored by the Center: Provided further, That the Center is authorized

to obligate funds in anticipation of reimbursements from agencies

receiving training sponsored by the Federal Law Enforcement

Training Center, except that total obligations at the end of the

fiscal year shall not exceed total budgetary resources available

at the end of the fiscal year: Provided further, That the Federal

Law Enforcement Training Center is authorized to provide training

for the Gang Resistance Education and Training program to Federal

and non-Federal personnel at any facility in partnership with the

Bureau of Alcohol, Tobacco and Firearms: Provided further, That

the Federal Law Enforcement Training Center is authorized to

provide short-term medical services for students undergoing training at the Center.

ACQUISITION, CONSTRUCTION, IMPROVEMENTS, AND RELATED

EXPENSES

For expansion of the Federal Law Enforcement Training Center,

for acquisition of necessary additional real property and facilities,

and for ongoing maintenance, facility improvements, and related

expenses, $29,205,000, to remain available until expended.

INTERAGENCY LAW ENFORCEMENT

INTERAGENCY CRIME AND DRUG ENFORCEMENT

For expenses necessary to conduct investigations and convict

offenders involved in organized crime drug trafficking, including

cooperative efforts with State and local law enforcement, as it

relates to the Treasury Department law enforcement violations

such as money laundering, violent crime, and smuggling,

$103,476,000, of which $7,827,000 shall remain available until

expended.

FINANCIAL MANAGEMENT SERVICE

SALARIES AND EXPENSES

For necessary expenses of the Financial Management Service,

$206,851,000, of which not to exceed $10,635,000 shall remain

available until September 30, 2003, for information systems modernization initiatives; and of which not to exceed $2,500 shall be

available for official reception and representation expenses.

BUREAU OF ALCOHOL, TOBACCO AND FIREARMS

SALARIES AND EXPENSES

For necessary expenses of the Bureau of Alcohol, Tobacco and

Firearms, including purchase of not to exceed 812 vehicles for

police-type use, of which 650 shall be for replacement only, and

hire of passenger motor vehicles; hire of aircraft; services of expert

witnesses at such rates as may be determined by the Director;

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–129

for payment of per diem and/or subsistence allowances to employees

where a major investigative assignment requires an employee to

work 16 hours or more per day or to remain overnight at his

or her post of duty; not to exceed $20,000 for official reception

and representation expenses; for training of State and local law

enforcement agencies with or without reimbursement, including

training in connection with the training and acquisition of canines

for explosives and fire accelerants detection; not to exceed $50,000

for cooperative research and development programs for Laboratory

Services and Fire Research Center activities; and provision of laboratory assistance to State and local agencies, with or without

reimbursement, $768,695,000, of which not to exceed $1,000,000

shall be available for the payment of attorneys’ fees as provided by 18 U.S.C. 924(d)(2); of which up to $2,000,000 shall be available

for the equipping of any vessel, vehicle, equipment, or aircraft

available for official use by a State or local law enforcement agency

if the conveyance will be used in joint law enforcement operations

with the Bureau of Alcohol, Tobacco and Firearms and for the

payment of overtime salaries including Social Security and Medicare, travel, fuel, training, equipment, supplies, and other similar

costs of State and local law enforcement personnel, including sworn

officers and support personnel, that are incurred in joint operations

with the Bureau of Alcohol, Tobacco and Firearms: Provided, That

no funds made available by this or any other Act may be used

to transfer the functions, missions, or activities of the Bureau

of Alcohol, Tobacco and Firearms to other agencies or Departments

in fiscal year 2001: Provided further, That no funds appropriated

herein shall be available for salaries or administrative expenses

in connection with consolidating or centralizing, within the Department of the Treasury, the records, or any portion thereof, of acquisition and disposition of firearms maintained by Federal firearms

licensees: Provided further, That no funds appropriated herein shall

be used to pay administrative expenses or the compensation of

any officer or employee of the United States to implement an

amendment or amendments to 27 CFR 178.118 or to change the

definition of ‘‘Curios or relics’’ in 27 CFR 178.11 or remove any

item from ATF Publication 5300.11 as it existed on January 1,

1994: Provided further, That none of the funds appropriated herein

shall be available to investigate or act upon applications for relief

from Federal firearms disabilities under 18 U.S.C. 925(c): Provided

further, That such funds shall be available to investigate and act

upon applications filed by corporations for relief from Federal firearms disabilities under 18 U.S.C. 925(c): Provided further, That

no funds under this Act may be used to electronically retrieve

information gathered pursuant to 18 U.S.C. 923(g)(4) by name

or any personal identification code.

UNITED STATES CUSTOMS SERVICE

SALARIES AND EXPENSES

For necessary expenses of the United States Customs Service,

including purchase and lease of up to 1,050 motor vehicles of

which 550 are for replacement only and of which 1,030 are for

police-type use and commercial operations; hire of motor vehicles;

contracting with individuals for personal services abroad; not to

exceed $40,000 for official reception and representation expenses;

and awards of compensation to informers, as authorized by any

114 STAT. 2763A–130 PUBLIC LAW 106–554—APPENDIX C

Act enforced by the United States Customs Service, $1,863,765,000,

of which such sums as become available in the Customs User

Fee Account, except sums subject to section 13031(f )(3) of the

Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (19 U.S.C. 58c(f )(3)), shall be derived from that Account; of

the total, not to exceed $150,000 shall be available for payment

for rental space in connection with preclearance operations; not

to exceed $4,000,000 shall be available until expended for research;

of which not less than $100,000 shall be available to promote

public awareness of the child pornography tipline; of which not

less than $200,000 shall be available for Project Alert; not to exceed

$5,000,000 shall be available until expended for conducting special

operations pursuant to 19 U.S.C. 2081; not to exceed $8,000,000

shall be available until expended for the procurement of automation

infrastructure items, including hardware, software, and installation;

and not to exceed $5,000,000 shall be available until expended

for repairs to Customs facilities: Provided, That uniforms may be

purchased without regard to the general purchase price limitation

for the current fiscal year: Provided further, That notwithstanding

any other provision of law, the fiscal year aggregate overtime limitation prescribed in subsection 5(c)(1) of the Act of February 13,

1911 (19 U.S.C. 261 and 267) shall be $30,000.

HARBOR MAINTENANCE FEE COLLECTION

(INCLUDING TRANSFER OF FUNDS)

For administrative expenses related to the collection of the

Harbor Maintenance Fee, pursuant to Public Law 103–182,

$3,000,000, to be derived from the Harbor Maintenance Trust Fund

and to be transferred to and merged with the Customs ‘‘Salaries

and Expenses’’ account for such purposes.

OPERATION, MAINTENANCE AND PROCUREMENT, AIR AND MARINE

INTERDICTION PROGRAMS

For expenses, not otherwise provided for, necessary for the

operation and maintenance of marine vessels, aircraft, and other

related equipment of the Air and Marine Programs, including operational training and mission-related travel, and rental payments

for facilities occupied by the air or marine interdiction and demand

reduction programs, the operations of which include the following:

the interdiction of narcotics and other goods; the provision of support to Customs and other Federal, State, and local agencies in

the enforcement or administration of laws enforced by the Customs

Service; and, at the discretion of the Commissioner of Customs,

the provision of assistance to Federal, State, and local agencies

in other law enforcement and emergency humanitarian efforts,

$133,228,000, which shall remain available until expended: Provided, That no aircraft or other related equipment, with the exception of aircraft which is one of a kind and has been identified

as excess to Customs requirements and aircraft which has been

damaged beyond repair, shall be transferred to any other Federal

agency, department, or office outside of the Department of the

Treasury, during fiscal year 2001 without the prior approval of

the Committees on Appropriations.

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–131

AUTOMATION MODERNIZATION

For expenses not otherwise provided for Customs automated systems, $258,400,000, to remain available until expended, of which

$5,400,000 shall be for the International Trade Data System, and

not less than $130,000,000 shall be for the development of the

Automated Commercial Environment: Provided, That none of the

funds appropriated under this heading may be obligated for the

Automated Commercial Environment until the United States Customs Service prepares and submits to the Committees on Appropriations a final plan for expenditure that: (1) meets the capital planning and investment control review requirements established by

the Office of Management and Budget, including OMB Circular

A–11, part 3; (2) complies with the United States Customs Service’s

Enterprise Information Systems Architecture; (3) complies with the

acquisition rules, requirements, guidelines, and systems acquisition

management practices of the Federal Government; (4) is reviewed

and approved by the Customs Investment Review Board, the

Department of the Treasury, and the Office of Management and

Budget; and (5) is reviewed by the General Accounting Office:

Provided further, That none of the funds appropriated under this

heading may be obligated for the Automated Commercial Environment until that final expenditure plan has been approved by the

Committees on Appropriations.

BUREAU OF THE PUBLIC DEBT

ADMINISTERING THE PUBLIC DEBT

For necessary expenses connected with any public-debt issues

of the United States, $187,301,000, of which not to exceed $2,500

shall be available for official reception and representation expenses,

and of which not to exceed $2,000,000 shall remain available until

expended for systems modernization: Provided, That the sum appropriated herein from the General Fund for fiscal year 2001 shall

be reduced by not more than $4,400,000 as definitive security

issue fees and Treasury Direct Investor Account Maintenance fees

are collected, so as to result in a final fiscal year 2001 appropriation

from the General Fund estimated at $182,901,000. In addition,

$23,600, to be derived from the Oil Spill Liability Trust Fund

to reimburse the Bureau for administrative and personnel expenses

for financial management of the Fund, as authorized by section

1012 of Public Law 101–380; and in addition, to be appropriated

from the General Fund, such sums as may be necessary for administrative expenses in association with the South Dakota Trust Fund

and the Cheyenne River Sioux Tribe Terrestrial Wildlife Restoration

and Lower Brule Sioux Tribe Terrestrial Restoration Trust Fund,

as authorized by sections 603(f ) and 604(f ) of Public Law 106– 53.

INTERNAL REVENUE SERVICE

PROCESSING, ASSISTANCE, AND MANAGEMENT

For necessary expenses of the Internal Revenue Service for

tax returns processing; revenue accounting; tax law and account

assistance to taxpayers by telephone and correspondence; providing

an independent taxpayer advocate within the Service; programs

114 STAT. 2763A–132 PUBLIC LAW 106–554—APPENDIX C

to match information returns and tax returns; management services; rent and utilities; and services as authorized by 5 U.S.C.

3109, at such rates as may be determined by the Commissioner,

$3,567,001,000, of which up to $3,950,000 shall be for the Tax

Counseling for the Elderly Program, and of which not to exceed

$25,000 shall be for official reception and representation expenses.

TAX LAW ENFORCEMENT

For necessary expenses of the Internal Revenue Service for

determining and establishing tax liabilities; providing litigation support; issuing technical rulings; providing service to tax exempt

customers, including employee plans, tax exempt organizations,

and government entities; examining employee plans and exempt

organizations; conducting criminal investigation and enforcement

activities; securing unfiled tax returns; collecting unpaid accounts;

compiling statistics of income and conducting compliance research;

purchase (for police-type use, not to exceed 850) and hire of passenger motor vehicles (31 U.S.C. 1343(b)); and services as authorized by 5 U.S.C. 3109, at such rates as may be determined by

the Commissioner, $3,382,402,000, of which not to exceed

$1,000,000 shall remain available until September 30, 2003, for

research.

EARNED INCOME TAX CREDIT COMPLIANCE INITIATIVE

For funding essential earned income tax credit compliance and

error reduction initiatives pursuant to section 5702 of the Balanced

Budget Act of 1997 (Public Law 105–33), $145,000,000, of which

not to exceed $10,000,000 may be used to reimburse the Social

Security Administration for the costs of implementing section 1090

of the Taxpayer Relief Act of 1997.

INFORMATION SYSTEMS

For necessary expenses of the Internal Revenue Service for

information systems and telecommunications support, including

developmental information systems and operational information

systems; the hire of passenger motor vehicles (31 U.S.C. 1343(b));

and services as authorized by 5 U.S.C. 3109, at such rates as

may be determined by the Commissioner, $1,545,090,000 which

shall remain available until September 30, 2002.

ADMINISTRATIVE PROVISIONS—INTERNAL REVENUE SERVICE

SEC. 101. Not to exceed 5 percent of any appropriation made

available in this Act to the Internal Revenue Service may be transferred to any other Internal Revenue Service appropriation upon

the advance approval of the Committees on Appropriations.

SEC. 102. The Internal Revenue Service shall maintain a training program to ensure that Internal Revenue Service employees

are trained in taxpayers’ rights, in dealing courteously with the

taxpayers, and in cross-cultural relations.

SEC. 103. The Internal Revenue Service shall institute and

enforce policies and procedures that will safeguard the confidentiality of taxpayer information.

SEC. 104. Funds made available by this or any other Act to

the Internal Revenue Service shall be available for improved facilities and increased manpower to provide sufficient and effective

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–133

1–800 help line service for taxpayers. The Commissioner shall continue to make the improvement of the Internal Revenue Service

1–800 help line service a priority and allocate resources necessary

to increase phone lines and staff to improve the Internal Revenue

Service 1–800 help line service.

UNITED STATES SECRET SERVICE

SALARIES AND EXPENSES

For necessary expenses of the United States Secret Service,

including purchase of not to exceed 844 vehicles for police-type

use, of which 541 shall be for replacement only, and hire of passenger motor vehicles; purchase of American-made side-car compatible motorcycles; hire of aircraft; training and assistance requested

by State and local governments, which may be provided without

reimbursement; services of expert witnesses at such rates as may

be determined by the Director; rental of buildings in the District

of Columbia, and fencing, lighting, guard booths, and other facilities

on private or other property not in Government ownership or control, as may be necessary to perform protective functions; for payment of per diem and/or subsistence allowances to employees where

a protective assignment during the actual day or days of the visit

of a protectee require an employee to work 16 hours per day

or to remain overnight at his or her post of duty; the conducting

of and participating in firearms matches; presentation of awards;

for travel of Secret Service employees on protective missions without

regard to the limitations on such expenditures in this or any other

Act if approval is obtained in advance from the Committees on

Appropriations; for research and development; for making grants

to conduct behavioral research in support of protective research

and operations; not to exceed $25,000 for official reception and

representation expenses; not to exceed $100,000 to provide technical

assistance and equipment to foreign law enforcement organizations

in counterfeit investigations; for payment in advance for commercial

accommodations as may be necessary to perform protective functions; and for uniforms without regard to the general purchase

price limitation for the current fiscal year, $823,800,000, of which

$3,633,000 shall be available as a grant for activities related to

the investigations of exploited children and shall remain available

until expended: Provided, That up to $18,000,000 provided for

protective travel shall remain available until September 30, 2002.

ACQUISITION, CONSTRUCTION, IMPROVEMENTS, AND RELATED

EXPENSES

For necessary expenses of construction, repair, alteration, and improvement of facilities, $8,941,000, to remain available until

expended.

GENERAL PROVISIONS—DEPARTMENT OF THE TREASURY

SEC. 110. Any obligation or expenditure by the Secretary of

the Treasury in connection with law enforcement activities of a

Federal agency or a Department of the Treasury law enforcement

organization in accordance with 31 U.S.C. 9703(g)(4)(B) from unobligated balances remaining in the Fund on September 30, 2001,

shall be made in compliance with reprogramming guidelines.

114 STAT. 2763A–134 PUBLIC LAW 106–554—APPENDIX C

SEC. 111. Appropriations to the Department of the Treasury

in this Act shall be available for uniforms or allowances therefor,

as authorized by law (5 U.S.C. 5901), including maintenance,

repairs, and cleaning; purchase of insurance for official motor

vehicles operated in foreign countries; purchase of motor vehicles

without regard to the general purchase price limitations for vehicles

purchased and used overseas for the current fiscal year; entering

into contracts with the Department of State for the furnishing

of health and medical services to employees and their dependents

serving in foreign countries; and services authorized by 5 U.S.C.

3109.

SEC. 112. The funds provided to the Bureau of Alcohol, Tobacco

and Firearms for fiscal year 2001 in this Act for the enforcement

of the Federal Alcohol Administration Act shall be expended in

a manner so as not to diminish enforcement efforts with respect

to section 105 of the Federal Alcohol Administration Act.

SEC. 113. Not to exceed 2 percent of any appropriations in

this Act made available to the Federal Law Enforcement Training

Center, Financial Crimes Enforcement Network, Bureau of Alcohol,

Tobacco and Firearms, United States Customs Service, and United

States Secret Service may be transferred between such appropriations upon the advance approval of the Committees on Appropriations. No transfer may increase or decrease any such appropriation

by more than 2 percent.

SEC. 114. Not to exceed 2 percent of any appropriations in

this Act made available to the Departmental Offices, Office of

Inspector General, Treasury Inspector General for Tax Administration, Financial Management Service, and Bureau of the Public

Debt, may be transferred between such appropriations upon the

advance approval of the Committees on Appropriations. No transfer

may increase or decrease any such appropriation by more than

2 percent.

SEC. 115. Not to exceed 2 percent of any appropriation made

available in this Act to the Internal Revenue Service may be transferred to the Treasury Inspector General for Tax Administration’s

appropriation upon the advance approval of the Committees on

Appropriations. No transfer may increase or decrease any such

appropriation by more than 2 percent.

SEC. 116. Of the funds available for the purchase of law enforcement vehicles, no funds may be obligated until the Secretary of

the Treasury certifies that the purchase by the respective Treasury

bureau is consistent with Departmental vehicle management principles: Provided, That the Secretary may delegate this authority

to the Assistant Secretary for Management.

SEC. 117. None of the funds appropriated in this Act or otherwise available to the Department of the Treasury or the Bureau

of Engraving and Printing may be used to redesign the $1 Federal

Reserve note.

SEC. 118. Hereafter, funds made available by this or any other

Act may be used to pay premium pay for protective services authorized by section 3056(a) of title 18, United States Code, without

regard to the limitation on the rate of pay payable during a pay

period contained in section 5547(c)(2) of title 5, United States Code,

except that such premium pay shall not be payable to an employee

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–135

to the extent that the aggregate of the employee’s basic and premium pay for the year would otherwise exceed the annual equivalent of that limitation. The term premium pay refers to the provisions of law cited in the first sentence of section 5547(a) of title

5, United States Code. Payment of additional premium pay payable

under this section may be made in a lump sum on the last payday

of the calendar year.

SEC. 119. The Secretary of the Treasury may transfer funds

from ‘‘Salaries and Expenses’’, Financial Management Service, to

the Debt Services Account as necessary to cover the costs of debt

collection: Provided, That such amounts shall be reimbursed to

such Salaries and Expenses account from debt collections received

in the Debt Services Account.

SEC. 120. Under the heading of Treasury Franchise Fund in

Public Law 104–208, delete the following: the phrases ‘‘pilot, as

authorized by section 403 of Public Law 103–356,’’; and ‘‘as provided

in such section’’; and the final proviso. After the phrase ‘‘to be

available’’, insert ‘‘without fiscal year limitation,’’. After the phrase,

‘‘established in the Treasury a franchise fund’’, insert, ‘‘until October

1, 2002’’.

SEC. 121. Notwithstanding any other provision of law, no

reorganization of the field operations of the United States Customs

Service Office of Field Operations shall result in a reduction in

service to the area served by the Port of Racine, Wisconsin, below

the level of service provided in fiscal year 2000.

SEC. 122. Notwithstanding any other provision of law, the

Bureau of Alcohol, Tobacco and Firearms shall reimburse the subcontractor that provided services in 1993 and 1994 pursuant to

Bureau of Alcohol, Tobacco and Firearms contract number TATF

93–3 from amounts appropriated for fiscal year 2001 or unobligated

balances from prior fiscal years, and such reimbursement shall

cover the cost of all professional services rendered, plus interest

calculated in accordance with the Contract Dispute Act of 1978

(41 U.S.C. 601 et seq.).

This title may be cited as the ‘‘Treasury Department Appropriations Act, 2001’’.

TITLE II—POSTAL SERVICE

PAYMENT TO THE POSTAL SERVICE FUND

For payment to the Postal Service Fund for revenue forgone

on free and reduced rate mail, pursuant to subsections (c) and

(d) of section 2401 of title 39, United States Code, $96,093,000,

of which $67,093,000 shall not be available for obligation until

October 1, 2001: Provided, That mail for overseas voting and mail

for the blind shall continue to be free: Provided further, That

6-day delivery and rural delivery of mail shall continue at not

less than the 1983 level: Provided further, That none of the funds

made available to the Postal Service by this Act shall be used

to implement any rule, regulation, or policy of charging any officer

or employee of any State or local child support enforcement agency,

or any individual participating in a State or local program of child

support enforcement, a fee for information requested or provided

concerning an address of a postal customer: Provided further, That

none of the funds provided in this Act shall be used to consolidate

114 STAT. 2763A–136 PUBLIC LAW 106–554—APPENDIX C

or close small rural and other small post offices in fiscal year

2001.

This title may be cited as the ‘‘Postal Service Appropriations

Act, 2001’’.

TITLE III—EXECUTIVE OFFICE OF THE PRESIDENT AND

FUNDS APPROPRIATED TO THE PRESIDENT

COMPENSATION OF THE PRESIDENT AND THE WHITE HOUSE OFFICE

COMPENSATION OF THE PRESIDENT

For compensation of the President, including an expense allowance at the rate of $50,000 per annum as authorized by 3 U.S.C.

102, $390,000: Provided, That none of the funds made available

for official expenses shall be expended for any other purpose and

any unused amount shall revert to the Treasury pursuant to section

1552 of title 31, United States Code: Provided further, That none

of the funds made available for official expenses shall be considered

as taxable to the President.

SALARIES AND EXPENSES

For necessary expenses for the White House as authorized

by law, including not to exceed $3,850,000 for services as authorized

by 5 U.S.C. 3109 and 3 U.S.C. 105; subsistence expenses as authorized by 3 U.S.C. 105, which shall be expended and accounted

for as provided in that section; hire of passenger motor vehicles,

newspapers, periodicals, teletype news service, and travel (not to

exceed $100,000 to be expended and accounted for as provided

by 3 U.S.C. 103); and not to exceed $19,000 for official entertainment expenses, to be available for allocation within the Executive

Office of the President, $53,288,000: Provided, That $9,072,000

of the funds appropriated shall be available for reimbursements

to the White House Communications Agency.

EXECUTIVE RESIDENCE AT THE WHITE HOUSE

OPERATING EXPENSES

For the care, maintenance, repair and alteration, refurnishing,

improvement, heating, and lighting, including electric power and

fixtures, of the Executive Residence at the White House and official

entertainment expenses of the President, $10,900,000, to be

expended and accounted for as provided by 3 U.S.C. 105, 109,

110, and 112–114.

REIMBURSABLE EXPENSES

For the reimbursable expenses of the Executive Residence at

the White House, such sums as may be necessary: Provided, That

all reimbursable operating expenses of the Executive Residence

shall be made in accordance with the provisions of this paragraph:

Provided further, That, notwithstanding any other provision of law,

such amount for reimbursable operating expenses shall be the exclusive authority of the Executive Residence to incur obligations and

to receive offsetting collections, for such expenses: Provided further,

That the Executive Residence shall require each person sponsoring

a reimbursable political event to pay in advance an amount equal

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–137

to the estimated cost of the event, and all such advance payments

shall be credited to this account and remain available until

expended: Provided further, That the Executive Residence shall

require the national committee of the political party of the President

to maintain on deposit $25,000, to be separately accounted for

and available for expenses relating to reimbursable political events

sponsored by such committee during such fiscal year: Provided

further, That the Executive Residence shall ensure that a written

notice of any amount owed for a reimbursable operating expense

under this paragraph is submitted to the person owing such amount

within 60 days after such expense is incurred, and that such amount

is collected within 30 days after the submission of such notice:

Provided further, That the Executive Residence shall charge interest

and assess penalties and other charges on any such amount that

is not reimbursed within such 30 days, in accordance with the

interest and penalty provisions applicable to an outstanding debt

on a United States Government claim under section 3717 of title

31, United States Code: Provided further, That each such amount

that is reimbursed, and any accompanying interest and charges,

shall be deposited in the Treasury as miscellaneous receipts: Provided further, That the Executive Residence shall prepare and

submit to the Committees on Appropriations, by not later than

90 days after the end of the fiscal year covered by this Act, a

report setting forth the reimbursable operating expenses of the

Executive Residence during the preceding fiscal year, including

the total amount of such expenses, the amount of such total that

consists of reimbursable official and ceremonial events, the amount

of such total that consists of reimbursable political events, and

the portion of each such amount that has been reimbursed as

of the date of the report: Provided further, That the Executive

Residence shall maintain a system for the tracking of expenses

related to reimbursable events within the Executive Residence that

includes a standard for the classification of any such expense as

political or nonpolitical: Provided further, That no provision of this

paragraph may be construed to exempt the Executive Residence

from any other applicable requirement of subchapter I or II of

chapter 37 of title 31, United States Code.

WHITE HOUSE REPAIR AND RESTORATION

For the repair, alteration, and improvement of the Executive

Residence at the White House, $968,000, to remain available until

expended, for projects for required maintenance, safety and health

issues, Presidential transition, telecommunications infrastructure

repair, and continued preventive maintenance.

SPECIAL ASSISTANCE TO THE PRESIDENT AND THE OFFICIAL

RESIDENCE OF THE VICE PRESIDENT

SALARIES AND EXPENSES

For necessary expenses to enable the Vice President to provide

assistance to the President in connection with specially assigned

functions; services as authorized by 5 U.S.C. 3109 and 3 U.S.C.

106, including subsistence expenses as authorized by 3 U.S.C. 106,

which shall be expended and accounted for as provided in that

section; and hire of passenger motor vehicles, $3,673,000.

114 STAT. 2763A–138 PUBLIC LAW 106–554—APPENDIX C

OPERATING EXPENSES

(INCLUDING TRANSFER OF FUNDS)

For the care, operation, refurnishing, improvement, heating

and lighting, including electric power and fixtures, of the official

residence of the Vice President; the hire of passenger motor vehicles;

and not to exceed $90,000 for official entertainment expenses of

the Vice President, to be accounted for solely on his certificate,

$354,000: Provided, That advances or repayments or transfers from

this appropriation may be made to any department or agency for

expenses of carrying out such activities.

COUNCIL OF ECONOMIC ADVISERS

SALARIES AND EXPENSES

For necessary expenses of the Council of Economic Advisers

in carrying out its functions under the Employment Act of 1946

(15 U.S.C. 1021), $4,110,000.

OFFICE OF POLICY DEVELOPMENT

SALARIES AND EXPENSES

For necessary expenses of the Office of Policy Development,

including services as authorized by 5 U.S.C. 3109 and 3 U.S.C.

107, $4,032,000.

NATIONAL SECURITY COUNCIL

SALARIES AND EXPENSES

For necessary expenses of the National Security Council, including services as authorized by 5 U.S.C. 3109, $7,165,000.

OFFICE OF ADMINISTRATION

SALARIES AND EXPENSES

For necessary expenses of the Office of Administration, including services as authorized by 5 U.S.C. 3109 and 3 U.S.C. 107,

and hire of passenger motor vehicles, $43,737,000, of which

$9,905,000 shall be available until September 30, 2002 for a capital

investment plan which provides for the continued modernization

of the information technology infrastructure.

OFFICE OF MANAGEMENT AND BUDGET

SALARIES AND EXPENSES

For necessary expenses of the Office of Management and

Budget, including hire of passenger motor vehicles and services

as authorized by 5 U.S.C. 3109, $68,786,000, of which not to exceed

$5,000,000 shall be available to carry out the provisions of chapter

35 of title 44, United States Code: Provided, That, as provided

in 31 U.S.C. 1301(a), appropriations shall be applied only to the

objects for which appropriations were made except as otherwise

provided by law: Provided further, That none of the funds appropriated in this Act for the Office of Management and Budget may

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–139

be used for the purpose of reviewing any agricultural marketing

orders or any activities or regulations under the provisions of the

Agricultural Marketing Agreement Act of 1937 (7 U.S.C. 601 et

seq.): Provided further, That none of the funds made available

for the Office of Management and Budget by this Act may be

expended for the altering of the transcript of actual testimony

of witnesses, except for testimony of officials of the Office of Management and Budget, before the Committees on Appropriations or

the Committees on Veterans’ Affairs or their subcommittees: Provided further, That the preceding shall not apply to printed hearings

released by the Committees on Appropriations or the Committees

on Veterans’ Affairs.

OFFICE OF NATIONAL DRUG CONTROL POLICY

SALARIES AND EXPENSES

(INCLUDING TRANSFER OF FUNDS)

For necessary expenses of the Office of National Drug Control

Policy; for research activities pursuant to the Office of National

Drug Control Policy Reauthorization Act of 1998 (title VII of division

C of Public Law 105–277); not to exceed $8,000 for official reception

and representation expenses; and for participation in joint projects

or in the provision of services on matters of mutual interest with

nonprofit, research, or public organizations or agencies, with or

without reimbursement, $24,759,000, of which $2,100,000 shall

remain available until expended, consisting of $1,100,000 for policy

research and evaluation, and $1,000,000 for the National Alliance

for Model State Drug Laws, and up to $600,000 for the evaluation

of the Drug-Free Communities Act: Provided, That the Office is

authorized to accept, hold, administer, and utilize gifts, both real

and personal, public and private, without fiscal year limitation,

for the purpose of aiding or facilitating the work of the Office.

COUNTERDRUG TECHNOLOGY ASSESSMENT CENTER

(INCLUDING TRANSFER OF FUNDS)

For necessary expenses for the Counterdrug Technology Assessment Center for research activities pursuant to the Office of

National Drug Control Policy Reauthorization Act of 1998 (title

VII of division C of Public Law 105–277), $29,053,000, which shall

remain available until expended, consisting of $15,803,000 for

counternarcotics research and development projects, and

$13,250,000 for the continued operation of the technology transfer

program: Provided, That the $15,803,000 for counter-narcotics

research and development projects shall be available for transfer

to other Federal departments or agencies.

FEDERAL DRUG CONTROL PROGRAMS

HIGH INTENSITY DRUG TRAFFICKING AREAS PROGRAM

(INCLUDING TRANSFER OF FUNDS)

For necessary expenses of the Office of National Drug Control

Policy’s High Intensity Drug Trafficking Areas Program,

$206,500,000 for drug control activities consistent with the approved

114 STAT. 2763A–140 PUBLIC LAW 106–554—APPENDIX C

strategy for each of the designated High Intensity Drug Trafficking

Areas, of which no less than 51 percent shall be transferred to

State and local entities for drug control activities, which shall

be obligated within 120 days of the date of the enactment of this

Act: Provided, That up to 49 percent, to remain available until

September 30, 2002, may be transferred to Federal agencies and

departments at a rate to be determined by the Director: Provided

further, That, of this latter amount, $1,800,000 shall be used for

auditing services: Provided further, That HIDTAs designated as

of September 30, 2000, shall be funded at fiscal year 2000 levels

unless the Director submits to the Committees, and the Committees

approve, justification for changes in those levels based on clearly

articulated priorities for the HIDTA program, as well as published

ONDCP performance measures of effectiveness.

SPECIAL FORFEITURE FUND

(INCLUDING TRANSFER OF FUNDS)

For activities to support a national anti-drug campaign for

youth, and other purposes, authorized by Public Law 105–277,

$233,600,000, to remain available until expended: Provided, That

such funds may be transferred to other Federal departments and

agencies to carry out such activities: Provided further, That of

the funds provided, $185,000,000 shall be to support a national

media campaign, as authorized in the Drug-Free Media Campaign

Act of 1998: Provided further, That of the funds provided, $3,300,000

shall be made available to the United States Olympic Committee’s

anti-doping program no later than 30 days after the enactment

of this Act: Provided further, That of the funds provided,

$40,000,000 shall be to continue a program of matching grants

to drug-free communities, as authorized in the Drug-Free Communities Act of 1997: Provided further, That of the funds provided,

$1,000,000 shall be available to the National Drug Court Institute.

This title may be cited as the ‘‘Executive Office Appropriations

Act, 2001’’.

TITLE IV—INDEPENDENT AGENCIES

COMMITTEE FOR PURCHASE FROM PEOPLE WHO ARE BLIND OR

SEVERELY DISABLED

SALARIES AND EXPENSES

For necessary expenses of the Committee for Purchase From

People Who Are Blind or Severely Disabled established by the

Act of June 23, 1971, Public Law 92–28, $4,158,000.

FEDERAL ELECTION COMMISSION

SALARIES AND EXPENSES

For necessary expenses to carry out the provisions of the Federal Election Campaign Act of 1971, as amended, $40,500,000,

of which no less than $4,689,500 shall be available for internal

automated data processing systems, and of which not to exceed

$5,000 shall be available for reception and representation expenses.

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–141

FEDERAL LABOR RELATIONS AUTHORITY

SALARIES AND EXPENSES

For necessary expenses to carry out functions of the Federal

Labor Relations Authority, pursuant to Reorganization Plan Numbered 2 of 1978, and the Civil Service Reform Act of 1978, including

services authorized by 5 U.S.C. 3109, including hire of experts

and consultants, hire of passenger motor vehicles, and rental of

conference rooms in the District of Columbia and elsewhere,

$25,058,000: Provided, That public members of the Federal Service

Impasses Panel may be paid travel expenses and per diem in

lieu of subsistence as authorized by law (5 U.S.C. 5703) for persons

employed intermittently in the Government service, and compensation as authorized by 5 U.S.C. 3109: Provided further, That notwithstanding 31 U.S.C. 3302, funds received from fees charged to nonFederal participants at labor-management relations conferences

shall be credited to and merged with this account, to be available

without further appropriation for the costs of carrying out these

conferences.

GENERAL SERVICES ADMINISTRATION

REAL PROPERTY ACTIVITIES

FEDERAL BUILDINGS FUND

LIMITATIONS ON AVAILABILITY OF REVENUE

(INCLUDING TRANSFER OF FUNDS)

For an additional amount to be deposited in, and to be used

for the purposes of, the Fund established pursuant to section 210(f )

of the Federal Property and Administration Act of 1949, as amended

(40 U.S.C. 490(f )), $464,154,000. The revenues and collections

deposited into the Fund shall be available for necessary expenses

of real property management and related activities not otherwise

provided for, including operation, maintenance, and protection of

federally-owned and leased buildings; rental of buildings in the

District of Columbia; restoration of leased premises; moving governmental agencies (including space adjustments and telecommunications relocation expenses) in connection with the assignment,

allocation and transfer of space; contractual services incident to

cleaning or servicing buildings, and moving; repair and alteration

of federally-owned buildings including grounds, approaches and

appurtenances; care and safeguarding of sites; maintenance,

preservation, demolition, and equipment; acquisition of buildings

and sites by purchase, condemnation, or as otherwise authorized

by law; acquisition of options to purchase buildings and sites;

conversion and extension of federally-owned buildings; preliminary

planning and design of projects by contract or otherwise; construction of new buildings (including equipment for such buildings);

and payment of principal, interest, and any other obligations for

public buildings acquired by installment purchase and purchase

contract; in the aggregate amount of $5,971,509,000 of which: (1)

$472,176,000 shall remain available until expended for construction

(including funds for sites and expenses and associated design and

construction services) of additional projects at the following locations: California, Los Angeles, United States Courthouse; District

114 STAT. 2763A–142 PUBLIC LAW 106–554—APPENDIX C

of Columbia, Bureau of Alcohol, Tobacco and Firearms Headquarters; Florida, Saint Petersburg, Combined Law Enforcement

Facility; Maryland, Montgomery County, Food and Drug Administration Consolidation; Michigan, Sault St. Marie, Border Station;

Mississippi, Biloxi-Gulfport, United States Courthouse; Montana,

Eureka/Roosville, Border Station; Virginia, Richmond, United

States Courthouse; Washington, Seattle, United States Courthouse:

Provided, That funding for any project identified above may be

exceeded to the extent that savings are effected in other such

projects, but not to exceed 10 percent of the amounts included

in an approved prospectus, if required, unless advance approval

is obtained from the Committees on Appropriations of a greater

amount: Provided further, That all funds for direct construction

projects shall expire on September 30, 2002, and remain in the

Federal Buildings Fund except for funds for projects as to which

funds for design or other funds have been obligated in whole or

in part prior to such date; (2) $671,193,000 shall remain available

until expended for repairs and alterations which includes associated

design and construction services: Provided further, That funds in

the Federal Buildings Fund for Repairs and Alterations shall, for

prospectus projects, be limited to the amount by project, as follows,

except each project may be increased by an amount not to exceed

10 percent unless advance approval is obtained from the Committees on Appropriations of a greater amount:

Repairs and alterations:

Arizona:

Phoenix, Federal Building Courthouse, $26,962,000

California:

Santa Ana, Federal Building, $27,864,000

District of Columbia:

Internal Revenue Service Headquarters (Phase 1),

$31,780,000

Main State Building, (Phase 3), $28,775,000

Maryland:

Woodlawn, SSA National Computer Center, $4,285,000

Michigan:

Detroit, McNamara Federal Building, $26,999,000

Missouri:

Kansas City, Richard Bolling Federal Building,

$25,882,000

Kansas City, Federal Building, 8930 Ward Parkway,

$8,964,000

Nebraska:

Omaha, Zorinsky Federal Building, $45,960,000

New York:

New York City, 40 Foley Square, $5,037,000

Ohio:

Cincinnati, Potter Stewart United States Courthouse,

$18,434,000

Pennsylvania:

Pittsburgh, United States Post Office-Courthouse,

$54,144,000

Utah:

Salt Lake City, Bennett Federal Building, $21,199,000

Virginia:

Reston, J.W. Powell Federal Building (Phase 2),

$22,993,000

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–143

Nationwide:

Design Program, $21,915,000

Energy Program, $5,000,000

Glass Fragment Retention Program, $5,000,000

Basic Repairs and Alterations, $290,000,000:

Provided further, That additional projects for which prospectuses

have been fully approved may be funded under this category only

if advance notice is transmitted to the Committees on Appropriations: Provided further, That the amounts provided in this or any

prior Act for ‘‘Repairs and Alterations’’ may be used to fund costs

associated with implementing security improvements to buildings

necessary to meet the minimum standards for security in accordance

with current law and in compliance with the reprogramming guidelines of the appropriate Committees of the House and Senate:

Provided further, That the difference between the funds appropriated and expended on any projects in this or any prior Act,

under the heading ‘‘Repairs and Alterations’’, may be transferred

to Basic Repairs and Alterations or used to fund authorized

increases in prospectus projects: Provided further, That all funds

for repairs and alterations prospectus projects shall expire on

September 30, 2002, and remain in the Federal Buildings Fund

except funds for projects as to which funds for design or other

funds have been obligated in whole or in part prior to such date:

Provided further, That the amount provided in this or any prior

Act for Basic Repairs and Alterations may be used to pay claims

against the Government arising from any projects under the heading ‘‘Repairs and Alterations’’ or used to fund authorized increases

in prospectus projects; (3) $185,369,000 for installment acquisition

payments including payments on purchase contracts which shall

remain available until expended; (4) $2,944,905,000 for rental of

space which shall remain available until expended; and (5)

$1,624,771,000 for building operations which shall remain available

until expended: Provided further, That in addition to amounts made

available herein, $276,400,000 shall be deposited to the Fund, to

become available on October 1, 2001, and remain available until

expended for the following construction projects (including funds

for sites and expenses and associated design and construction services): District of Columbia, United States Courthouse Annex; Florida, Miami, United States Courthouse; Massachusetts, Springfield,

United States Courthouse; New York, Buffalo, United States Courthouse: Provided further, That funding for any project identified

above may be exceeded to the extent that savings are effected

in other such projects, but not to exceed 10 percent of the amounts

included in an approved prospectus, if required, unless advance

approval is obtained from the Committees on Appropriations of

a greater amount: Provided further, That funds available to the

General Services Administration shall not be available for expenses

of any construction, repair, alteration and acquisition project for

which a prospectus, if required by the Public Buildings Act of

1959, as amended, has not been approved, except that necessary

funds may be expended for each project for required expenses

for the development of a proposed prospectus: Provided further,

That funds available in the Federal Buildings Fund may be

expended for emergency repairs when advance approval is obtained

from the Committees on Appropriations: Provided further, That

amounts necessary to provide reimbursable special services to other

agencies under section 210(f )(6) of the Federal Property and

114 STAT. 2763A–144 PUBLIC LAW 106–554—APPENDIX C

Administrative Services Act of 1949, as amended (40 U.S.C.

490(f )(6)) and amounts to provide such reimbursable fencing, lighting, guard booths, and other facilities on private or other property

not in Government ownership or control as may be appropriate

to enable the United States Secret Service to perform its protective

functions pursuant to 18 U.S.C. 3056, shall be available from such

revenues and collections: Provided further, That revenues and collections and any other sums accruing to this Fund during fiscal

year 2001, excluding reimbursements under section 210(f )(6) of

the Federal Property and Administrative Services Act of 1949 (40

U.S.C. 490(f )(6)) in excess of $5,971,509,000 shall remain in the

Fund and shall not be available for expenditure except as authorized

in appropriations Acts.

POLICY AND OPERATIONS

For expenses authorized by law, not otherwise provided for,

for Government-wide policy and oversight activities associated with

asset management activities; utilization and donation of surplus

personal property; transportation; procurement and supply; Government-wide responsibilities relating to automated data management,

telecommunications, information resources management, and

related technology activities; utilization survey, deed compliance

inspection, appraisal, environmental and cultural analysis, and land

use planning functions pertaining to excess and surplus real property; agency-wide policy direction; Board of Contract Appeals;

accounting, records management, and other support services

incident to adjudication of Indian Tribal Claims by the United

States Court of Federal Claims; services as authorized by 5 U.S.C.

3109; and not to exceed $5,000 for official reception and representation expenses, $123,920,000, of which $27,301,000 shall remain

available until expended: Provided, That none of the funds appropriated from this Act shall be available to convert the Old Post

Office at 1100 Pennsylvania Avenue in Northwest Washington,

D.C., from office use to any other use until a comprehensive plan,

which shall include street-level retail use, has been approved by

the Senate Committee on Appropriations, the House Committee

on Transportation and Infrastructure, and the Senate Committee

on Environment and Public Works: Provided further, That no funds

from this Act shall be available to acquire by purchase, condemnation, or otherwise the leasehold rights of the existing lease with

private parties at the Old Post Office prior to the approval of

the comprehensive plan by the Senate Committee on Appropriations, the House Committee on Transportation and Infrastructure,

and the Senate Committee on Environment and Public Works.

OFFICE OF INSPECTOR GENERAL

For necessary expenses of the Office of Inspector General and

services authorized by 5 U.S.C. 3109, $34,520,000: Provided, That

not to exceed $15,000 shall be available for payment for information

and detection of fraud against the Government, including payment

for recovery of stolen Government property: Provided further, That

not to exceed $2,500 shall be available for awards to employees

of other Federal agencies and private citizens in recognition of

efforts and initiatives resulting in enhanced Office of Inspector

General effectiveness.

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–145

ALLOWANCES AND OFFICE STAFF FOR FORMER PRESIDENTS

(INCLUDING TRANSFER OF FUNDS)

For carrying out the provisions of the Act of August 25, 1958,

as amended (3 U.S.C. 102 note), and Public Law 95–138, $2,517,000:

Provided, That the Administrator of General Services shall transfer

to the Secretary of the Treasury such sums as may be necessary

to carry out the provisions of such Acts.

EXPENSES, PRESIDENTIAL TRANSITION

For expenses necessary to carry out the Presidential Transition

Act of 1963, as amended, $7,100,000.

GENERAL SERVICES ADMINISTRATION—GENERAL PROVISIONS

SEC. 401. The appropriate appropriation or fund available to

the General Services Administration shall be credited with the

cost of operation, protection, maintenance, upkeep, repair, and

improvement, included as part of rentals received from Government

corporations pursuant to law (40 U.S.C. 129).

SEC. 402. Funds available to the General Services Administration shall be available for the hire of passenger motor vehicles.

SEC. 403. Funds in the Federal Buildings Fund made available

for fiscal year 2001 for Federal Buildings Fund activities may

be transferred between such activities only to the extent necessary

to meet program requirements: Provided, That any proposed transfers shall be approved in advance by the Committees on Appropriations.

SEC. 404. No funds made available by this Act shall be used

to transmit a fiscal year 2002 request for United States Courthouse

construction that: (1) does not meet the design guide standards

for construction as established and approved by the General Services Administration, the Judicial Conference of the United States,

and the Office of Management and Budget; and (2) does not reflect

the priorities of the Judicial Conference of the United States as

set out in its approved 5-year construction plan: Provided, That

the fiscal year 2002 request must be accompanied by a standardized

courtroom utilization study of each facility to be constructed,

replaced, or expanded.

SEC. 405. None of the funds provided in this Act may be

used to increase the amount of occupiable square feet, provide

cleaning services, security enhancements, or any other service usually provided through the Federal Buildings Fund, to any agency

that does not pay the rate per square foot assessment for space

and services as determined by the General Services Administration

in compliance with the Public Buildings Amendments Act of 1972

(Public Law 92–313).

SEC. 406. Funds provided to other Government agencies by

the Information Technology Fund, General Services Administration,

under 40 U.S.C. 757 and sections 5124(b) and 5128 of Public Law

104–106, Information Technology Management Reform Act of 1996,

for performance of pilot information technology projects which have

potential for Governmentwide benefits and savings, may be repaid

to this Fund from any savings actually incurred by these projects

or other funding, to the extent feasible.

114 STAT. 2763A–146 PUBLIC LAW 106–554—APPENDIX C

SEC. 407. From funds made available under the heading ‘‘Federal Buildings Fund, Limitations on Availability of Revenue’’, claims

against the Government of less than $250,000 arising from direct

construction projects and acquisition of buildings may be liquidated

from savings effected in other construction projects with prior

notification to the Committees on Appropriations.

SEC. 408. Section 411 of Public Law 106–58 is amended by

striking ‘‘April 30, 2001’’ each place it appears and inserting ‘‘April

30, 2002’’. SEC. 409. DESIGNATION OF RONALD N. DAVIES FEDERAL BUILD- ING AND UNITED STATES COURTHOUSE. (a) The Federal building

and courthouse located at 102 North 4th Street, Grand Forks,

North Dakota, shall be known and designated as the ‘‘Ronald N.

Davies Federal Building and United States Courthouse’’. (b) Any reference in a law, map, regulation, document, paper,

or other record of the United States to the Federal building and

courthouse referred to in section 1 shall be deemed to be a reference

to the Ronald N. Davies Federal Building and United States Courthouse.

SEC. 410. From the funds made available under the heading

‘‘Federal Buildings Fund Limitations on Revenue’’, in addition to

amounts provided in budget activities above, up to $2,500,000 shall

be available for the construction of a road and acquisition of the

property necessary for construction of said road and associated

port of entry facilities: Provided, That said property shall include

a 125 foot wide right-of-way beginning approximately 700 feet east

of Highway 11 at the northeast corner of the existing port facilities

and going north approximately 4,750 feet and approximately 10.22

acres adjacent to the port of entry in Township 29 S. Range 8W.,

Section 14: Provided further, That construction of the road shall

occur only after this property is deeded and conveyed to the United

States by and through the General Services Administration without

reimbursement or cost to the United States at the election of

its current landholder: Provided further, That notwithstanding any

other provision of law, and subject to the foregoing conditions,

the Administrator of General Services shall construct a road to

the Columbus, New Mexico Port of Entry Station on the property,

connecting the port with a road to be built by the County of

Luna, New Mexico to connect to State Highway 11: Provided further,

That notwithstanding any other provision of law, Luna County

shall construct the roadway from State Highway 11 to the terminus

of the northbound road to be constructed by the General Services

Administration in time for completion of the road to be constructed

by the General Services Administration in time for completion

of the road to be constructed by the General Services Administration: Provided further, That upon completion of the construction

of the road by the General Services Administration, and notwithstanding any other provision of law, the Administrator of General

Services shall convey to the municipality of Luna County, New

Mexico, without reimbursement, all right, title, and interest of

the United States to that portion of the property constituting the

improved road and standard county road right-of-way which is

not required for the operation of the port of entry: Provided further,

That the General Services Administration on behalf of the United

States upon conveyance of the property to the municipality of Luna,

New Mexico, shall retain the balance of the property located adjacent to the port, consisting of approximately 12 acres, to be owned

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–147

or otherwise managed by the Administrator pursuant to the Federal

Property and Administrative Services Act of 1949, as amended:

Provided further, That the General Services Administration is

authorized to acquire such additional real property and rights in

real property as may be necessary to construct said road and

provide a contiguous site for the port of entry: Provided further,

That the United States shall incur no liability for any environmental

laws or conditions existing at the property at the time of conveyance

to the United States or in connection with the construction of

the road: Provided further, That Luna County and the Village

of Columbus shall be responsible for providing adequate access

and egress to existing properties east of the port of entry: Provided

further, That the Bureau of Land Management, the International

Boundary and Water Commission, the Federal Inspection Agencies

and the Department of State shall take all actions necessary to

facilitate the construction of the road and expansion of the port

facilities.

SEC. 411. DESIGNATION OF J. BRATTON DAVIS UNITED STATES

BANKRUPTCY COURTHOUSE. (a) The United States bankruptcy courthouse at 1100 Laurel Street in Columbia, South Carolina, shall

be known and designated as the ‘‘J. Bratton Davis United States

Bankruptcy Courthouse’’.

(b) Any reference in a law, map, regulation, document, paper,

or other record of the United States to the United States bankruptcy

courthouse referred to in subsection (a) shall be deemed to be

a reference to the ‘‘J. Bratton Davis United States Bankruptcy

Courthouse’’.

SEC. 412. (a) The United States Courthouse Annex located

at 901 19th Street in Denver, Colorado is hereby designated as

the ‘‘Alfred A. Arraj United States Courthouse Annex’’.

(b) Any reference in a law, map, regulation, document, or

paper or other record of the United States to the Courthouse Annex

herein referred to in subsection (a) shall be deemed to be a reference

to the ‘‘Alfred A. Arraj United States Courthouse Annex’’.

SEC. 413. DESIGNATION OF THE PAUL COVERDELL DORMITORY.

The dormitory building currently being constructed on the Core

Campus of the Federal Law Enforcement Training Center in Glynco,

Georgia, shall be known and designated as the ‘‘Paul Coverdell

Dormitory’’.

MERIT SYSTEMS PROTECTION BOARD

SALARIES AND EXPENSES

(INCLUDING TRANSFER OF FUNDS)

For necessary expenses to carry out functions of the Merit

Systems Protection Board pursuant to Reorganization Plan Numbered 2 of 1978 and the Civil Service Reform Act of 1978, including

services as authorized by 5 U.S.C. 3109, rental of conference rooms

in the District of Columbia and elsewhere, hire of passenger motor

vehicles, and direct procurement of survey printing, $29,437,000

together with not to exceed $2,430,000 for administrative expenses

to adjudicate retirement appeals to be transferred from the Civil

Service Retirement and Disability Fund in amounts determined

by the Merit Systems Protection Board.

114 STAT. 2763A–148 PUBLIC LAW 106–554—APPENDIX C

FEDERAL PAYMENT TO MORRIS K. UDALL SCHOLARSHIP AND

EXCELLENCE IN NATIONAL ENVIRONMENTAL POLICY FOUNDATION

For payment to the Morris K. Udall Scholarship and Excellence

in National Environmental Trust Fund, to be available for the

purposes of Public Law 102–252, $2,000,000, to remain available

until expended.

ENVIRONMENTAL DISPUTE RESOLUTION FUND

For payment to the Environmental Dispute Resolution Fund

to carry out activities authorized in the Environmental Policy and

Conflict Resolution Act of 1998, $1,250,000, to remain available

until expended.

NATIONAL ARCHIVES AND RECORDS ADMINISTRATION

OPERATING EXPENSES

For necessary expenses in connection with the administration

of the National Archives (including the Information Security Oversight Office) and archived Federal records and related activities,

as provided by law, and for expenses necessary for the review

and declassification of documents, and for the hire of passenger

motor vehicles, $209,393,000: Provided, That the Archivist of the

United States is authorized to use any excess funds available from

the amount borrowed for construction of the National Archives

facility, for expenses necessary to provide adequate storage for

holdings.

REPAIRS AND RESTORATION

For the repair, alteration, and improvement of archives facilities, and to provide adequate storage for holdings, $95,150,000,

to remain available until expended of which $88,000,000 is to complete renovation of the National Archives Building.

NATIONAL HISTORICAL PUBLICATIONS AND RECORDS COMMISSION

GRANTS PROGRAM

(INCLUDING RESCISSION OF FUNDS)

For necessary expenses for allocations and grants for historical

publications and records as authorized by 44 U.S.C. 2504, as amended, $6,450,000, to remain available until expended.

OFFICE OF GOVERNMENT ETHICS

SALARIES AND EXPENSES

For necessary expenses to carry out functions of the Office

of Government Ethics pursuant to the Ethics in Government Act

of 1978, as amended and the Ethics Reform Act of 1989, including

services as authorized by 5 U.S.C. 3109, rental of conference rooms

in the District of Columbia and elsewhere, hire of passenger motor

vehicles, and not to exceed $1,500 for official reception and representation expenses, $9,684,000.

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–149

OFFICE OF PERSONNEL MANAGEMENT

SALARIES AND EXPENSES

(INCLUDING TRANSFER OF TRUST FUNDS)

For necessary expenses to carry out functions of the Office

of Personnel Management pursuant to Reorganization Plan Numbered 2 of 1978 and the Civil Service Reform Act of 1978, including

services as authorized by 5 U.S.C. 3109; medical examinations

performed for veterans by private physicians on a fee basis; rental

of conference rooms in the District of Columbia and elsewhere;

hire of passenger motor vehicles; not to exceed $2,500 for official

reception and representation expenses; advances for reimbursements to applicable funds of the Office of Personnel Management

and the Federal Bureau of Investigation for expenses incurred

under Executive Order No. 10422 of January 9, 1953, as amended;

and payment of per diem and/or subsistence allowances to employees where Voting Rights Act activities require an employee to

remain overnight at his or her post of duty, $94,095,000; and

in addition $101,986,000 for administrative expenses, to be transferred from the appropriate trust funds of the Office of Personnel

Management without regard to other statutes, including direct

procurement of printed materials, for the retirement and insurance

programs, of which $10,500,000 shall remain available until

expended for the cost of automating the retirement recordkeeping

systems: Provided, That the provisions of this appropriation shall

not affect the authority to use applicable trust funds as provided

by sections 8348(a)(1)(B) and 8909(g) of title 5, United States Code:

Provided further, That no part of this appropriation shall be available for salaries and expenses of the Legal Examining Unit of

the Office of Personnel Management established pursuant to Executive Order No. 9358 of July 1, 1943, or any successor unit of

like purpose: Provided further, That the President’s Commission

on White House Fellows, established by Executive Order No. 11183

of October 3, 1964, may, during fiscal year 2001, accept donations

of money, property, and personal services in connection with the

development of a publicity brochure to provide information about

the White House Fellows, except that no such donations shall

be accepted for travel or reimbursement of travel expenses, or

for the salaries of employees of such Commission.

OFFICE OF INSPECTOR GENERAL

SALARIES AND EXPENSES

(INCLUDING TRANSFER OF TRUST FUNDS)

For necessary expenses of the Office of Inspector General in

carrying out the provisions of the Inspector General Act, as amended, including services as authorized by 5 U.S.C. 3109, hire of

passenger motor vehicles, $1,360,000; and in addition, not to exceed

$9,745,000 for administrative expenses to audit, investigate, and

provide other oversight of the Office of Personnel Management’s

retirement and insurance programs, to be transferred from the

appropriate trust funds of the Office of Personnel Management,

as determined by the Inspector General: Provided, That the Inspector General is authorized to rent conference rooms in the District

of Columbia and elsewhere.

114 STAT. 2763A–150 PUBLIC LAW 106–554—APPENDIX C

GOVERNMENT PAYMENT FOR ANNUITANTS, EMPLOYEES HEALTH

BENEFITS

For payment of Government contributions with respect to

retired employees, as authorized by chapter 89 of title 5, United

States Code, and the Retired Federal Employees Health Benefits

Act (74 Stat. 849), as amended, such sums as may be necessary.

GOVERNMENT PAYMENT FOR ANNUITANTS, EMPLOYEE LIFE

INSURANCE

For payment of Government contributions with respect to

employees retiring after December 31, 1989, as required by chapter

87 of title 5, United States Code, such sums as may be necessary.

PAYMENT TO CIVIL SERVICE RETIREMENT AND DISABILITY FUND

For financing the unfunded liability of new and increased annuity benefits becoming effective on or after October 20, 1969, as

authorized by 5 U.S.C. 8348, and annuities under special Acts

to be credited to the Civil Service Retirement and Disability Fund,

such sums as may be necessary: Provided, That annuities authorized by the Act of May 29, 1944, as amended, and the Act of

August 19, 1950, as amended (33 U.S.C. 771–775), may hereafter

be paid out of the Civil Service Retirement and Disability Fund.

OFFICE OF SPECIAL COUNSEL

SALARIES AND EXPENSES

For necessary expenses to carry out functions of the Office

of Special Counsel pursuant to Reorganization Plan Numbered 2

of 1978, the Civil Service Reform Act of 1978 (Public Law 95–

454), the Whistleblower Protection Act of 1989 (Public Law 101–

12), Public Law 103–424, and the Uniformed Services Employment

and Reemployment Act of 1994 (Public Law 103–353), including

services as authorized by 5 U.S.C. 3109, payment of fees and

expenses for witnesses, rental of conference rooms in the District

of Columbia and elsewhere, and hire of passenger motor vehicles,

$11,147,000.

UNITED STATES TAX COURT

SALARIES AND EXPENSES

For necessary expenses, including contract reporting and other services as authorized by 5 U.S.C. 3109, $37,305,000: Provided, That travel expenses of the judges shall be paid upon the written

certificate of the judge.

This title may be cited as the ‘‘Independent Agencies Appropriations Act, 2001’’.

TITLE V—GENERAL PROVISIONS

THIS ACT

SEC. 501. No part of any appropriation contained in this Act

shall remain available for obligation beyond the current fiscal year

unless expressly so provided herein.

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–151

SEC. 502. The expenditure of any appropriation under this

Act for any consulting service through procurement contract, pursuant to 5 U.S.C. 3109, shall be limited to those contracts where

such expenditures are a matter of public record and available

for public inspection, except where otherwise provided under existing law, or under existing Executive order issued pursuant to existing law.

SEC. 503. None of the funds made available by this Act shall

be available for any activity or for paying the salary of any Government employee where funding an activity or paying a salary to

a Government employee would result in a decision, determination,

rule, regulation, or policy that would prohibit the enforcement of

section 307 of the Tariff Act of 1930.

SEC. 504. None of the funds made available by this Act shall

be available in fiscal year 2001 for the purpose of transferring

control over the Federal Law Enforcement Training Center located

at Glynco, Georgia, and Artesia, New Mexico, out of the Department

of the Treasury.

SEC. 505. No part of any appropriation contained in this Act

shall be available to pay the salary for any person filling a position,

other than a temporary position, formerly held by an employee

who has left to enter the Armed Forces of the United States and

has satisfactorily completed his period of active military or naval

service, and has within 90 days after his release from such service

or from hospitalization continuing after discharge for a period of

not more than 1 year, made application for restoration to his former

position and has been certified by the Office of Personnel Management as still qualified to perform the duties of his former position

and has not been restored thereto.

SEC. 506. No funds appropriated pursuant to this Act may

be expended by an entity unless the entity agrees that in expending

the assistance the entity will comply with sections 2 through 4

of the Act of March 3, 1933 (41 U.S.C. 10a–10c, popularly known

as the ‘‘Buy American Act’’).

SEC. 507. (a) PURCHASE OF AMERICAN-MADE EQUIPMENT AND

PRODUCTS.—In the case of any equipment or products that may

be authorized to be purchased with financial assistance provided

under this Act, it is the sense of the Congress that entities receiving

such assistance should, in expending the assistance, purchase only

American-made equipment and products.

(b) NOTICE TO RECIPIENTS OF ASSISTANCE.—In providing financial assistance under this Act, the Secretary of the Treasury shall

provide to each recipient of the assistance a notice describing the

statement made in subsection (a) by the Congress.

SEC. 508. If it has been finally determined by a court or Federal

agency that any person intentionally affixed a label bearing a

‘‘Made in America’’ inscription, or any inscription with the same

meaning, to any product sold in or shipped to the United States

that is not made in the United States, such person shall be ineligible

to receive any contract or subcontract made with funds provided

pursuant to this Act, pursuant to the debarment, suspension, and

ineligibility procedures described in sections 9.400 through 9.409

of title 48, Code of Federal Regulations.

SEC. 509. No funds appropriated by this Act shall be available

to pay for an abortion, or the administrative expenses in connection

with any health plan under the Federal employees health benefit

program which provides any benefits or coverage for abortions.

114 STAT. 2763A–152 PUBLIC LAW 106–554—APPENDIX C

SEC. 510. The provision of section 509 shall not apply where

the life of the mother would be endangered if the fetus were carried

to term, or the pregnancy is the result of an act of rape or incest.

SEC. 511. Except as otherwise specifically provided by law,

not to exceed 50 percent of unobligated balances remaining available

at the end of fiscal year 2001 from appropriations made available

for salaries and expenses for fiscal year 2001 in this Act, shall

remain available through September 30, 2002, for each such account

for the purposes authorized: Provided, That a request shall be

submitted to the Committees on Appropriations for approval prior

to the expenditure of such funds: Provided further, That these

requests shall be made in compliance with reprogramming guidelines.

SEC. 512. None of the funds made available in this Act may

be used by the Executive Office of the President to request from

the Federal Bureau of Investigation any official background investigation report on any individual, except when— (1) such individual has given his or her express written

consent for such request not more than 6 months prior to

the date of such request and during the same presidential

administration; or

(2) such request is required due to extraordinary circumstances involving national security.

SEC. 513. The cost accounting standards promulgated under

section 26 of the Office of Federal Procurement Policy Act (Public

Law 93–400; 41 U.S.C. 422) shall not apply with respect to a

contract under the Federal Employees Health Benefits Program

established under chapter 89 of title 5, United States Code.

SEC. 514. (a) IN GENERAL.—As soon as practicable after the

date of the enactment of this Act, the Archivist of the United

States shall transfer to the Gerald R. Ford Foundation, as trustee,

all right, title, and interest of the United States in and to the

approximately 2.3 acres of land located within Grand Rapids, Michigan, and further described in subsection (b), such grant to be

in trust, with the beneficiary being the National Archives and

Records Administration, for the purpose of supporting the facilities

and programs of the Gerald R. Ford Museum in Grand Rapids,

Michigan, and the Gerald R. Ford Library in Ann Arbor, Michigan,

in accordance with a trust agreement to be agreed upon by the

Archivist and the Gerald R. Ford Foundation.

(b) LAND DESCRIPTION.—The land to be transferred pursuant

to subsection (a) is described as follows:

The following premises in the City of Grand Rapids, County

of Kent, State of Michigan, described as:

That part of Block 2, Converse Plat, and that part of Block

2 of J.W. Converse Replatted Addition, and that part of Government

Lot 1 of Section 25, T7N, R12W, City of Grand Rapids, Kent

County, Michigan, described as: BEGINNING at the NE corner

of Lot 1 of Block 2 of Converse Plat; thence East 245.0 feet along

the South line of Bridge Street; thence South 230.0 feet along

a line which is parallel with and 170 feet East from the East

line of Front Avenue as originally platted; thence West 207.5 feet

parallel with the South line of Bridge Street; thence South along

the centerline of vacated Front Avenue 109 feet more or less to

the extended centerline of vacated Douglas Street; thence West

along the centerline of vacated Douglas Street 237.5 feet more

or less to the East line of Scribner Avenue; thence North along

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–153

the East line of Scribner Avenue 327 feet more or less to a point

which is 7.0 feet South from the NW corner of Lot 8 of Block

2 of Converse Plat; thence Easterly 200 feet more or less to the

place of beginning, also described as:

Parcel A—Lots 9 & 10, Block 2 of Converse Plat, being the

subdivision of Government Lots 1 & 2, Section 25, T7N, R12W;

also Lots 11–24, Block 2 of J.W. Converse Replatted Addition;

also part of N 1⁄2 of Section 25, T7N, R12W, commencing at SE

corner Lot 24, Block 2 of J.W. Converse Replatted Addition, thence

N to NE corner of Lot 9 of Converse Plat, thence E 16 feet,

thence S to SW corner of Lot 23 of J.W. Converse Replatted Addition, thence W 16 feet to beginning.

Parcel B—Part of Section 25, T7N, R12W, commencing on

S line of Bridge Street 50 feet E of E line of Front Avenue, thence

S 107.85 feet, thence 77 feet, thence N to a point on S line of

said street which is 80 feet E of beginning, thence W to beginning.

Parcel C—Part of Section 25, T7N, R12W, commencing at SE

corner Bridge Street & Front Avenue, thence E 50 feet, thence

S 107.85 feet to alley, thence W 50 feet to E line Front Avenue,

thence N 106.81 feet to beginning.

Parcel D—Part of Government Lot 1, Section 25, T7N, R12W,

commencing at a point on S line of Bridge Street (66′ wide) 170

feet E of E line of Front Avenue (75′ wide), thence S 230 feet

parallel with Front Avenue, thence W 170 feet parallel with Bridge

Street to E line of Front Avenue, thence N along said line to

a point 106.81 feet S of intersection of said line with extension

of N & S line of Bridge Street, thence E 127 feet, thence northerly

to a point on S line of Bridge Street 130 feet E of E line of

Front Avenue, thence E along S line of Bridge Street to beginning.

Parcel E—Lots 1 through 8 of Block 2 of Converse Plat, being

the subdivision of Government Lots 1 and 2, Section 25, T7N,

R12W.

Also part of N 1⁄2 of Section 25, T7N, R12W, commencing

at NW corner of Lot 9, Block 2 of J.W. Converse Replatted Addition;

thence N 15 feet to SW corner of Lot 8; thence E 200 feet to

SE corner Lot 1; thence S 15 feet to NE corner of Lot 10; thence

W 200 feet to beginning.

Together with any portion of vacated streets and alleys that

have become part of the above property.

(c) TERMS AND CONDITIONS.—

(1) COMPENSATION.—The land transferred pursuant to subsection (a) shall be transferred without compensation to the

United States.

(2) APPOINTMENT OF SUCCESSOR TRUSTEE.—In the event

that the Gerald R. Ford Foundation for any reason is unable

or unwilling to continue to serve as trustee, the Archivist

of the United States is authorized to appoint a successor

trustee.

(3) REVERSIONARY INTEREST.—If the Archivist of the United

States determines that the Gerald R. Ford Foundation (or a

successor trustee appointed under paragraph (2)) has breached

its fiduciary duty under the trust agreement entered into pursuant to this section, the land transferred pursuant to subsection

(a) shall revert to the United States under the administrative

jurisdiction of the Archivist.

SEC. 515. (a) IN GENERAL.—The Director of the Office of

Management and Budget shall, by not later than September 30,

114 STAT. 2763A–154 PUBLIC LAW 106–554—APPENDIX C

2001, and with public and Federal agency involvement, issue guidelines under sections 3504(d)(1) and 3516 of title 44, United States

Code, that provide policy and procedural guidance to Federal agencies for ensuring and maximizing the quality, objectivity, utility,

and integrity of information (including statistical information)

disseminated by Federal agencies in fulfillment of the purposes

and provisions of chapter 35 of title 44, United States Code, commonly referred to as the Paperwork Reduction Act.

(b) CONTENT OF GUIDELINES.—The guidelines under subsection

(a) shall—

(1) apply to the sharing by Federal agencies of, and access

to, information disseminated by Federal agencies; and

(2) require that each Federal agency to which the guidelines

apply— (A) issue guidelines ensuring and maximizing the quality, objectivity, utility, and integrity of information (including statistical information) disseminated by the agency,

by not later than 1 year after the date of issuance of

the guidelines under subsection (a);

(B) establish administrative mechanisms allowing

affected persons to seek and obtain correction of information maintained and disseminated by the agency that does

not comply with the guidelines issued under subsection

(a); and

(C) report periodically to the Director— (i) the number and nature of complaints received

by the agency regarding the accuracy of information

disseminated by the agency; and

(ii) how such complaints were handled by the

agency.

SEC. 516. For the purpose of resolving litigation and implementing any settlement agreements regarding the nonforeign area costof-living allowance program, the Office of Personnel Management

may accept and utilize (without regard to any restriction on

unanticipated travel expenses imposed in an Appropriations Act)

funds made available to the Office pursuant to court approval.

SEC. 517. None of the funds appropriated by this Act shall

be used to propose or issue rules, regulations, decrees, or orders

for the purpose of implementation, or in preparation for

implementation, of the Kyoto Protocol, which was adopted on

December 11, 1997, in Kyoto, Japan, at the Third Conference of

the Parties to the United Nations Framework Convention on Climate Change, which has not been submitted to the Senate for

advice and consent to ratification pursuant to article II, section

2, clause 2, of the United States Constitution, and which has

not entered into force pursuant to article 25 of the Protocol.

SEC. 518. Not later than July 1, 2001, the Director of the

Office of Management and Budget shall submit a report to the

Committee on Appropriations and the Committee on Governmental

Affairs of the Senate and the Committee on Appropriations and

the Committee on Government Reform of the House of Representatives that: (1) evaluates, for each agency, the extent to which

implementation of chapter 35 of title 31, United States Code, as

amended by the Paperwork Reduction Act of 1995 (Public Law

104–13), has reduced burden imposed by rules issued by the agency,

including the burden imposed by each major rule issued by the

agency; (2) includes a determination, based on such evaluation,

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–155

of the need for additional procedures to ensure achievement of

the purposes of that chapter, as set forth in section 3501 of title

31, United States Code, and evaluates the burden imposed by

each major rule that imposes more than 10,000,000 hours of burden,

and identifies specific reductions expected to be achieved in each

of fiscal years 2001 and 2002 in the burden imposed by all rules

issued by each agency that issued such a major rule.

TITLE VI—GENERAL PROVISIONS

DEPARTMENTS, AGENCIES, AND CORPORATIONS

SEC. 601. Funds appropriated in this or any other Act may

be used to pay travel to the United States for the immediate

family of employees serving abroad in cases of death or life threatening illness of said employee.

SEC. 602. No department, agency, or instrumentality of the

United States receiving appropriated funds under this or any other

Act for fiscal year 2001 shall obligate or expend any such funds,

unless such department, agency, or instrumentality has in place,

and will continue to administer in good faith, a written policy

designed to ensure that all of its workplaces are free from the

illegal use, possession, or distribution of controlled substances (as

defined in the Controlled Substances Act) by the officers and

employees of such department, agency, or instrumentality.

SEC. 603. Unless otherwise specifically provided, the maximum

amount allowable during the current fiscal year in accordance with

section 16 of the Act of August 2, 1946 (60 Stat. 810), for the

purchase of any passenger motor vehicle (exclusive of buses, ambulances, law enforcement, and undercover surveillance vehicles), is

hereby fixed at $8,100 except station wagons for which the maximum shall be $9,100: Provided, That these limits may be exceeded

by not to exceed $3,700 for police-type vehicles, and by not to

exceed $4,000 for special heavy-duty vehicles: Provided further,

That the limits set forth in this section may not be exceeded

by more than 5 percent for electric or hybrid vehicles purchased

for demonstration under the provisions of the Electric and Hybrid

Vehicle Research, Development, and Demonstration Act of 1976:

Provided further, That the limits set forth in this section may

be exceeded by the incremental cost of clean alternative fuels

vehicles acquired pursuant to Public Law 101–549 over the cost

of comparable conventionally fueled vehicles.

SEC. 604. Appropriations of the executive departments and

independent establishments for the current fiscal year available

for expenses of travel, or for the expenses of the activity concerned,

are hereby made available for quarters allowances and cost-ofliving allowances, in accordance with 5 U.S.C. 5922–5924.

SEC. 605. Unless otherwise specified during the current fiscal

year, no part of any appropriation contained in this or any other

Act shall be used to pay the compensation of any officer or employee

of the Government of the United States (including any agency

the majority of the stock of which is owned by the Government

of the United States) whose post of duty is in the continental

United States unless such person: (1) is a citizen of the United

States; (2) is a person in the service of the United States on

the date of the enactment of this Act who, being eligible for citizenship, has filed a declaration of intention to become a citizen of

114 STAT. 2763A–156 PUBLIC LAW 106–554—APPENDIX C

the United States prior to such date and is actually residing in

the United States; (3) is a person who owes allegiance to the

United States; (4) is an alien from Cuba, Poland, South Vietnam,

the countries of the former Soviet Union, or the Baltic countries

lawfully admitted to the United States for permanent residence;

(5) is a South Vietnamese, Cambodian, or Laotian refugee paroled

in the United States after January 1, 1975; or (6) is a national

of the People’s Republic of China who qualifies for adjustment

of status pursuant to the Chinese Student Protection Act of 1992:

Provided, That for the purpose of this section, an affidavit signed

by any such person shall be considered prima facie evidence that

the requirements of this section with respect to his or her status

have been complied with: Provided further, That any person making

a false affidavit shall be guilty of a felony, and, upon conviction,

shall be fined no more than $4,000 or imprisoned for not more

than 1 year, or both: Provided further, That the above penal clause

shall be in addition to, and not in substitution for, any other

provisions of existing law: Provided further, That any payment

made to any officer or employee contrary to the provisions of this

section shall be recoverable in action by the Federal Government.

This section shall not apply to citizens of Ireland, Israel, or the

Republic of the Philippines, or to nationals of those countries allied

with the United States in a current defense effort, or to international broadcasters employed by the United States Information

Agency, or to temporary employment of translators, or to temporary

employment in the field service (not to exceed 60 days) as a result

of emergencies.

SEC. 606. Appropriations available to any department or agency

during the current fiscal year for necessary expenses, including

maintenance or operating expenses, shall also be available for payment to the General Services Administration for charges for space

and services and those expenses of renovation and alteration of

buildings and facilities which constitute public improvements performed in accordance with the Public Buildings Act of 1959 (73

Stat. 749), the Public Buildings Amendments of 1972 (87 Stat.

216), or other applicable law.

SEC. 607. In addition to funds provided in this or any other

Act, all Federal agencies are authorized to receive and use funds

resulting from the sale of materials, including Federal records disposed of pursuant to a records schedule recovered through recycling

or waste prevention programs. Such funds shall be available until

expended for the following purposes:

(1) Acquisition, waste reduction and prevention, and

recycling programs as described in Executive Order No. 13101

(September 14, 1998), including any such programs adopted

prior to the effective date of the Executive order.

(2) Other Federal agency environmental management programs, including, but not limited to, the development and

implementation of hazardous waste management and pollution

prevention programs.

(3) Other employee programs as authorized by law or as

deemed appropriate by the head of the Federal agency.

SEC. 608. Funds made available by this or any other Act for

administrative expenses in the current fiscal year of the corporations and agencies subject to chapter 91 of title 31, United States

Code, shall be available, in addition to objects for which such

funds are otherwise available, for rent in the District of Columbia;

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–157

services in accordance with 5 U.S.C. 3109; and the objects specified

under this head, all the provisions of which shall be applicable

to the expenditure of such funds unless otherwise specified in

the Act by which they are made available: Provided, That in the

event any functions budgeted as administrative expenses are subsequently transferred to or paid from other funds, the limitations

on administrative expenses shall be correspondingly reduced.

SEC. 609. No part of any appropriation for the current fiscal

year contained in this or any other Act shall be paid to any person

for the filling of any position for which he or she has been nominated

after the Senate has voted not to approve the nomination of said

person.

SEC. 610. No part of any appropriation contained in this or

any other Act shall be available for interagency financing of boards

(except Federal Executive Boards), commissions, councils, committees, or similar groups (whether or not they are interagency entities)

which do not have a prior and specific statutory approval to receive

financial support from more than one agency or instrumentality.

SEC. 611. Funds made available by this or any other Act to

the Postal Service Fund (39 U.S.C. 2003) shall be available for

employment of guards for all buildings and areas owned or occupied

by the Postal Service and under the charge and control of the

Postal Service, and such guards shall have, with respect to such

property, the powers of special policemen provided by the first

section of the Act of June 1, 1948, as amended (62 Stat. 281;

40 U.S.C. 318), and, as to property owned or occupied by the

Postal Service, the Postmaster General may take the same actions

as the Administrator of General Services may take under the provisions of sections 2 and 3 of the Act of June 1, 1948, as amended

(62 Stat. 281; 40 U.S.C. 318a and 318b), attaching thereto penal

consequences under the authority and within the limits provided

in section 4 of the Act of June 1, 1948, as amended (62 Stat.

281; 40 U.S.C. 318c).

SEC. 612. None of the funds made available pursuant to the

provisions of this Act shall be used to implement, administer, or

enforce any regulation which has been disapproved pursuant to

a resolution of disapproval duly adopted in accordance with the

applicable law of the United States.

SEC. 613. (a) Notwithstanding any other provision of law, and

except as otherwise provided in this section, no part of any of

the funds appropriated for fiscal year 2001, by this or any other

Act, may be used to pay any prevailing rate employee described

in section 5342(a)(2)(A) of title 5, United States Code—

(1) during the period from the date of expiration of the

limitation imposed by section 613 of the Treasury and General

Government Appropriations Act, 2000, until the normal effective date of the applicable wage survey adjustment that is

to take effect in fiscal year 2001, in an amount that exceeds

the rate payable for the applicable grade and step of the

applicable wage schedule in accordance with such section 613;

and

(2) during the period consisting of the remainder of fiscal

year 2001, in an amount that exceeds, as a result of a wage

survey adjustment, the rate payable under paragraph (1) by

more than the sum of—

(A) the percentage adjustment taking effect in fiscal

year 2001 under section 5303 of title 5, United States

114 STAT. 2763A–158 PUBLIC LAW 106–554—APPENDIX C

Code, in the rates of pay under the General Schedule;

and

(B) the difference between the overall average percentage of the locality-based comparability payments taking

effect in fiscal year 2001 under section 5304 of such title

(whether by adjustment or otherwise), and the overall average percentage of such payments which was effective in

fiscal year 2000 under such section.

(b) Notwithstanding any other provision of law, no prevailing

rate employee described in subparagraph (B) or (C) of section

5342(a)(2) of title 5, United States Code, and no employee covered

by section 5348 of such title, may be paid during the periods

for which subsection (a) is in effect at a rate that exceeds the

rates that would be payable under subsection (a) were subsection

(a) applicable to such employee.

(c) For the purposes of this section, the rates payable to an

employee who is covered by this section and who is paid from

a schedule not in existence on September 30, 2000, shall be determined under regulations prescribed by the Office of Personnel

Management.

(d) Notwithstanding any other provision of law, rates of premium pay for employees subject to this section may not be changed

from the rates in effect on September 30, 2000, except to the

extent determined by the Office of Personnel Management to be

consistent with the purpose of this section.

(e) This section shall apply with respect to pay for service

performed after September 30, 2000.

(f ) For the purpose of administering any provision of law

(including any rule or regulation that provides premium pay, retirement, life insurance, or any other employee benefit) that requires

any deduction or contribution, or that imposes any requirement

or limitation on the basis of a rate of salary or basic pay, the

rate of salary or basic pay payable after the application of this

section shall be treated as the rate of salary or basic pay.

(g) Nothing in this section shall be considered to permit or

require the payment to any employee covered by this section at

a rate in excess of the rate that would be payable were this section

not in effect.

(h) The Office of Personnel Management may provide for exceptions to the limitations imposed by this section if the Office determines that such exceptions are necessary to ensure the recruitment

or retention of qualified employees.

SEC. 614. During the period in which the head of any department or agency, or any other officer or civilian employee of the

Government appointed by the President of the United States, holds

office, no funds may be obligated or expended in excess of $5,000

to furnish or redecorate the office of such department head, agency

head, officer, or employee, or to purchase furniture or make

improvements for any such office, unless advance notice of such

furnishing or redecoration is expressly approved by the Committees

on Appropriations. For the purposes of this section, the word ‘‘office’’ shall include the entire suite of offices assigned to the individual,

as well as any other space used primarily by the individual or

the use of which is directly controlled by the individual.

SEC. 615. Notwithstanding any other provision of law, no executive branch agency shall purchase, construct, and/or lease any additional facilities, except within or contiguous to existing locations,

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–159

to be used for the purpose of conducting Federal law enforcement

training without the advance approval of the Committees on Appropriations, except that the Federal Law Enforcement Training Center

is authorized to obtain the temporary use of additional facilities

by lease, contract, or other agreement for training which cannot

be accommodated in existing Center facilities.

SEC. 616. Notwithstanding section 1346 of title 31, United

States Code, or section 610 of this Act, funds made available for

fiscal year 2001 by this or any other Act shall be available for

the interagency funding of national security and emergency

preparedness telecommunications initiatives which benefit multiple

Federal departments, agencies, or entities, as provided by Executive

Order No. 12472 (April 3, 1984).

SEC. 617. (a) None of the funds appropriated by this or any

other Act may be obligated or expended by any Federal department,

agency, or other instrumentality for the salaries or expenses of

any employee appointed to a position of a confidential or policydetermining character excepted from the competitive service pursuant to section 3302 of title 5, United States Code, without a certification to the Office of Personnel Management from the head of

the Federal department, agency, or other instrumentality employing

the Schedule C appointee that the Schedule C position was not

created solely or primarily in order to detail the employee to the

White House.

(b) The provisions of this section shall not apply to Federal

employees or members of the armed services detailed to or from— (1) the Central Intelligence Agency;

(2) the National Security Agency;

(3) the Defense Intelligence Agency;

(4) the offices within the Department of Defense for the

collection of specialized national foreign intelligence through

reconnaissance programs;

(5) the Bureau of Intelligence and Research of the Department of State;

(6) any agency, office, or unit of the Army, Navy, Air

Force, and Marine Corps, the Federal Bureau of Investigation

and the Drug Enforcement Administration of the Department

of Justice, the Department of Transportation, the Department

of the Treasury, and the Department of Energy performing

intelligence functions; and

(7) the Director of Central Intelligence.

SEC. 618. No department, agency, or instrumentality of the

United States receiving appropriated funds under this or any other

Act for fiscal year 2001 shall obligate or expend any such funds,

unless such department, agency, or instrumentality has in place,

and will continue to administer in good faith, a written policy

designed to ensure that all of its workplaces are free from discrimination and sexual harassment and that all of its workplaces are

not in violation of title VII of the Civil Rights Act of 1964, as

amended, the Age Discrimination in Employment Act of 1967, and

the Rehabilitation Act of 1973.

SEC. 619. None of the funds made available in this Act for

the United States Customs Service may be used to allow the

importation into the United States of any good, ware, article, or

merchandise mined, produced, or manufactured by forced or indentured child labor, as determined pursuant to section 307 of the

Tariff Act of 1930 (19 U.S.C. 1307).

114 STAT. 2763A–160 PUBLIC LAW 106–554—APPENDIX C

SEC. 620. No part of any appropriation contained in this or

any other Act shall be available for the payment of the salary

of any officer or employee of the Federal Government, who—

(1) prohibits or prevents, or attempts or threatens to prohibit or prevent, any other officer or employee of the Federal

Government from having any direct oral or written communication or contact with any Member, committee, or subcommittee

of the Congress in connection with any matter pertaining to

the employment of such other officer or employee or pertaining

to the department or agency of such other officer or employee

in any way, irrespective of whether such communication or

contact is at the initiative of such other officer or employee

or in response to the request or inquiry of such Member,

committee, or subcommittee; or

(2) removes, suspends from duty without pay, demotes,

reduces in rank, seniority, status, pay, or performance of efficiency rating, denies promotion to, relocates, reassigns, transfers, disciplines, or discriminates in regard to any employment

right, entitlement, or benefit, or any term or condition of

employment of, any other officer or employee of the Federal

Government, or attempts or threatens to commit any of the

foregoing actions with respect to such other officer or employee,

by reason of any communication or contact of such other officer

or employee with any Member, committee, or subcommittee

of the Congress as described in paragraph (1).

SEC. 621. (a) None of the funds made available in this or

any other Act may be obligated or expended for any employee

training that—

(1) does not meet identified needs for knowledge, skills,

and abilities bearing directly upon the performance of official

duties;

(2) contains elements likely to induce high levels of emotional response or psychological stress in some participants;

(3) does not require prior employee notification of the content and methods to be used in the training and written end

of course evaluation;

(4) contains any methods or content associated with religious or quasi-religious belief systems or ‘‘new age’’ belief systems as defined in Equal Employment Opportunity Commission

Notice N–915.022, dated September 2, 1988; or

(5) is offensive to, or designed to change, participants’

personal values or lifestyle outside the workplace.

(b) Nothing in this section shall prohibit, restrict, or otherwise

preclude an agency from conducting training bearing directly upon

the performance of official duties.

SEC. 622. No funds appropriated in this or any other Act

may be used to implement or enforce the agreements in Standard

Forms 312 and 4414 of the Government or any other nondisclosure

policy, form, or agreement if such policy, form, or agreement does

not contain the following provisions: ‘‘These restrictions are consistent with and do not supersede, conflict with, or otherwise alter

the employee obligations, rights, or liabilities created by Executive

Order No. 12958; section 7211 of title 5, U.S.C. (governing disclosures to Congress); section 1034 of title 10, United States Code,

as amended by the Military Whistleblower Protection Act (governing

disclosure to Congress by members of the military); section

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–161

2302(b)(8) of title 5, United States Code, as amended by the Whistleblower Protection Act (governing disclosures of illegality, waste,

fraud, abuse or public health or safety threats); the Intelligence

Identities Protection Act of 1982 (50 U.S.C. 421 et seq.) (governing

disclosures that could expose confidential Government agents); and

the statutes which protect against disclosure that may compromise

the national security, including sections 641, 793, 794, 798, and

952 of title 18, United States Code, and section 4(b) of the Subversive Activities Act of 1950 (50 U.S.C. 783(b)). The definitions,

requirements, obligations, rights, sanctions, and liabilities created

by said Executive order and listed statutes are incorporated into

this agreement and are controlling.’’: Provided, That notwithstanding the preceding paragraph, a nondisclosure policy form or agreement that is to be executed by a person connected with the conduct

of an intelligence or intelligence-related activity, other than an

employee or officer of the United States Government, may contain

provisions appropriate to the particular activity for which such

document is to be used. Such form or agreement shall, at a minimum, require that the person will not disclose any classified

information received in the course of such activity unless specifically

authorized to do so by the United States Government. Such nondisclosure forms shall also make it clear that they do not bar

disclosures to Congress or to an authorized official of an executive

agency or the Department of Justice that are essential to reporting

a substantial violation of law.

SEC. 623. No part of any funds appropriated in this or any

other Act shall be used by an agency of the executive branch,

other than for normal and recognized executive-legislative relationships, for publicity or propaganda purposes, and for the preparation,

distribution or use of any kit, pamphlet, booklet, publication, radio,

television or film presentation designed to support or defeat legislation pending before the Congress, except in presentation to the

Congress itself.

SEC. 624. (a) IN GENERAL.—For calendar year 2002 and each

year thereafter, the Director of the Office of Management and

Budget shall prepare and submit to Congress, with the budget

submitted under section 1105 of title 31, United States Code, an

accounting statement and associated report containing—

(1) an estimate of the total annual costs and benefits

(including quantifiable and nonquantifiable effects) of Federal

rules and paperwork, to the extent feasible—

(A) in the aggregate;

(B) by agency and agency program; and

(C) by major rule;

(2) an analysis of impacts of Federal regulation on State,

local, and tribal government, small business, wages, and economic growth; and

(3) recommendations for reform.

(b) NOTICE.—The Director of the Office of Management and

Budget shall provide public notice and an opportunity to comment

on the statement and report under subsection (a) before the statement and report are submitted to Congress.

(c) GUIDELINES.—To implement this section, the Director of

the Office of Management and Budget shall issue guidelines to

agencies to standardize—

(1) measures of costs and benefits; and

(2) the format of accounting statements.

114 STAT. 2763A–162 PUBLIC LAW 106–554—APPENDIX C

(d) PEER REVIEW.—The Director of the Office of Management

and Budget shall provide for independent and external peer review

of the guidelines and each accounting statement and associated

report under this section. Such peer review shall not be subject

to the Federal Advisory Committee Act (5 U.S.C. App.).

SEC. 625. None of the funds appropriated by this or any other

Act may be used by an agency to provide a Federal employee’s

home address to any labor organization except when the employee

has authorized such disclosure or when such disclosure has been

ordered by a court of competent jurisdiction.

SEC. 626. Hereafter, the Secretary of the Treasury is authorized

to establish scientific certification standards for explosives detection

canines, and shall provide, on a reimbursable basis, for the certification of explosives detection canines employed by Federal agencies,

or other agencies providing explosives detection services at airports

in the United States.

SEC. 627. None of the funds made available in this Act or

any other Act may be used to provide any non-public information

such as mailing or telephone lists to any person or any organization

outside of the Federal Government without the approval of the

Committees on Appropriations.

SEC. 628. No part of any appropriation contained in this or

any other Act shall be used for publicity or propaganda purposes

within the United States not heretofore authorized by the Congress.

SEC. 629. (a) In this section the term ‘‘agency’’—

(1) means an Executive agency as defined under section

105 of title 5, United States Code;

(2) includes a military department as defined under section

102 of such title, the Postal Service, and the Postal Rate

Commission; and

(3) shall not include the General Accounting Office.

(b) Unless authorized in accordance with law or regulations

to use such time for other purposes, an employee of an agency

shall use official time in an honest effort to perform official duties.

An employee not under a leave system, including a Presidential

appointee exempted under section 6301(2) of title 5, United States

Code, has an obligation to expend an honest effort and a reasonable

proportion of such employee’s time in the performance of official

duties.

SEC. 630. (a) None of the funds appropriated by this Act may

be used to enter into or renew a contract which includes a provision

providing prescription drug coverage, except where the contract

also includes a provision for contraceptive coverage.

(b) Nothing in this section shall apply to a contract with—

(1) any of the following religious plans:

(A) Personal Care’s HMO;

(B) Care Choices;

(C) OSF Health Plans, Inc.; and

(2) any existing or future plan, if the carrier for the plan

objects to such coverage on the basis of religious beliefs.

(c) In implementing this section, any plan that enters into

or renews a contract under this section may not subject any individual to discrimination on the basis that the individual refuses to

prescribe or otherwise provide for contraceptives because such

activities would be contrary to the individual’s religious beliefs

or moral convictions.

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–163

(d) Nothing in this section shall be construed to require coverage of abortion or abortion-related services.

SEC. 631. Notwithstanding 31 U.S.C. 1346 and section 610

of this Act, funds made available for fiscal year 2001 by this

or any other Act to any department or agency, which is a member

of the Joint Financial Management Improvement Program (JFMIP),

shall be available to finance an appropriate share of JFMIP

administrative costs, as determined by the JFMIP, but not to exceed

a total of $800,000 including the salary of the Executive Director

and staff support.

SEC. 632. Notwithstanding 31 U.S.C. 1346 and section 610

of this Act, the head of each Executive department and agency

is hereby authorized to transfer to the ‘‘Policy and Operations’’ account, General Services Administration, with the approval of

the Director of the Office of Management and Budget, funds made

available for fiscal year 2001 by this or any other Act, including

rebates from charge card and other contracts. These funds shall

be administered by the Administrator of General Services to support

Government-wide financial, information technology, procurement,

and other management innovations, initiatives, and activities, as

approved by the Director of the Office of Management and Budget,

in consultation with the appropriate interagency groups designated

by the Director (including the Chief Financial Officers Council

and the Joint Financial Management Improvement Program for

financial management initiatives, the Chief Information Officers

Council for information technology initiatives, and the Procurement

Executives Council for procurement initiatives). The total funds

transferred shall not exceed $17,000,000. Such transfers may only

be made 15 days following notification of the Committees on Appropriations by the Director of the Office of Management and Budget.

SEC. 633. (a) IN GENERAL.—In accordance with regulations

promulgated by the Office of Personnel Management, an Executive

agency which provides or proposes to provide child care services

for Federal employees may use appropriated funds (otherwise available to such agency for salaries and expenses) to provide child

care, in a Federal or leased facility, or through contract, for civilian

employees of such agency.

(b) AFFORDABILITY.—Amounts so provided with respect to any

such facility or contractor shall be applied to improve the affordability of child care for lower income Federal employees using

or seeking to use the child care services offered by such facility

or contractor.

(c) DEFINITION.—For purposes of this section, the term ‘‘Executive agency’’ has the meaning given such term by section 105

of title 5, United States Code, but does not include the General

Accounting Office.

(d) NOTIFICATION.—None of the funds made available in this

or any other Act may be used to implement the provisions of

this section absent advance notification to the Committees on Appropriations.

SEC. 634. Notwithstanding any other provision of law, a woman

may breastfeed her child at any location in a Federal building

or on Federal property, if the woman and her child are otherwise

authorized to be present at the location.

SEC. 635. Nothwithstanding section 1346 of title 31, United

States Code, or section 610 of this Act, funds made available for

fiscal year 2001 by this or any other Act shall be available for

114 STAT. 2763A–164 PUBLIC LAW 106–554—APPENDIX C

the interagency funding of specific projects, workshops, studies,

and similar efforts to carry out the purposes of the National Science

and Technology Council (authorized by Executive Order No. 12881),

which benefit multiple Federal departments, agencies, or entities:

Provided, That the Office of Management and Budget shall provide

a report describing the budget of and resources connected with

the National Science and Technology Council to the Committees

on Appropriations, the House Committee on Science; and the Senate

Committee on Commerce, Science, and Transportation 90 days after

enactment of this Act.

SEC. 636. RETIREMENT PROVISIONS RELATING TO CERTAIN MEMBERS OF THE POLICE FORCE OF THE METROPOLITAN WASHINGTON

AIRPORTS AUTHORITY.—(a) QUALIFIED MWAA POLICE OFFICER

DEFINED.—For purposes of this section, the term ‘‘qualified MWAA

police officer’’ means any individual who, as of the date of the

enactment of this Act—

(1) is employed as a member of the police force of the

Metropolitan Washington Airports Authority (hereafter in this

section referred to as an ‘‘MWAA police officer’’); and

(2) is subject to the Civil Service Retirement System or

the Federal Employees’ Retirement System by virtue of section

49107(b) of title 49, United States Code.

(b) ELIGIBILITY TO BE TREATED AS A LAW ENFORCEMENT OFFICER FOR RETIREMENT PURPOSES.—

(1) IN GENERAL.—Any qualified MWAA police officer may,

by written election submitted in accordance with applicable

requirements under subsection (c), elect to be treated as a

law enforcement officer (within the meaning of section 8331

or 8401 of title 5, United States Code, as applicable), and

to have all prior service described in paragraph (2) similarly

treated.

(2) PRIOR SERVICE DESCRIBED.—The service described in

this paragraph is all service which an individual performed,

prior to the effective date of such individual’s election under

this section, as—

(A) an MWAA police officer; or

(B) a member of the police force of the Federal Aviation

Administration (hereafter in this section referred to as

an ‘‘FAA police officer’’).

(c) REGULATIONS.—The Office of Personnel Management shall

prescribe any regulations necessary to carry out this section, including provisions relating to the time, form, and manner in which

any election under this section shall be made. Such an election

shall not be effective unless—

(1) it is made before the employee separates from service

with the Metropolitan Washington Airports Authority, but in

no event later than 1 year after the regulations under this

subsection take effect; and

(2) it is accompanied by payment of an amount equal

to, with respect to all prior service of such employee which

is described in subsection (b)(2)—

(A) the employee deductions that would have been

required for such service under chapter 83 or 84 of title

5, U.S.C. (as the case may be) if such election had then

been in effect, minus

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–165

(B) the total employee deductions and contributions

under such chapter 83 and 84 (as applicable) that were

actually made for such service,

taking into account only amounts required to be credited to

the Civil Service Retirement and Disability Fund. Any amount

under paragraph (2) shall be computed with interest, in accordance with section 8334(e) of such title 5.

(d) GOVERNMENT CONTRIBUTIONS.—Whenever a payment under

subsection (c)(2) is made by an individual with respect to such

individual’s prior service (as described in subsection (b)(2)), the

Metropolitan Washington Airports Authority shall pay into the

Civil Service Retirement and Disability Fund any additional contributions for which it would have been liable, with respect to

such service, if such individual’s election under this section had

then been in effect (and, to the extent of any prior FAA police

officer service, as if it had then been the employing agency). Any

amount under this subsection shall be computed with interest,

in accordance with section 8334(e) of title 5, United States Code.

(e) CERTIFICATIONS.—The Office of Personnel Management shall

accept, for the purpose of this section, the certification of—

(1) the Metropolitan Washington Airports Authority (or

its designee) concerning any service performed by an individual

as an MWAA police officer; and

(2) the Federal Aviation Administration (or its designee)

concerning any service performed by an individual as an FAA

police officer.

(f ) REIMBURSEMENT TO COMPENSATE FOR UNFUNDED LIABILITY.—

(1) IN GENERAL.—The Metropolitan Washington Airports

Authority shall pay into the Civil Service Retirement and

Disability Fund an amount (as determined by the Director

of the Office of Personnel Management) equal to the amount

necessary to reimburse the Fund for any estimated increase

in the unfunded liability of the Fund (to the extent the Civil

Service Retirement System is involved), and for any estimated

increase in the supplemental liability of the Fund (to the extent

the Federal Employees’ Retirement System is involved), resulting from the enactment of this section.

(2) PAYMENT METHOD.—The Metropolitan Washington Airports Authority shall pay the amount so determined in five

equal annual installments, with interest (which shall be computed at the rate used in the most recent valuation of the

Federal Employees’ Retirement System).

SEC. 637. (a) For purposes of this section—

(1) the term ‘‘comparability payment’’ refers to a localitybased comparability payment under section 5304 of title 5,

United States Code;

(2) the term ‘‘President’s pay agent’’ refers to the pay

agent described in section 5302(4) of such title; and

(3) the term ‘‘pay locality’’ has the meaning given such

term by section 5302(5) of such title.

(b) Notwithstanding any provision of section 5304 of title 5,

United States Code, for purposes of determining appropriate pay

localities and making comparability payment recommendations, the

President’s pay agent may, in accordance with succeeding provisions

of this section, make comparisons of General Schedule pay and

114 STAT. 2763A–166 PUBLIC LAW 106–554—APPENDIX C

non-Federal pay within any of the metropolitan statistical areas

described in subsection (d)(3), using— (1) data from surveys of the Bureau of Labor Statistics;

(2) salary data sets obtained under subsection (c); or

(3) any combination thereof.

(c) To the extent necessary in order to carry out this section,

the President’s pay agent may obtain any salary data sets (referred

to in subsection (b)) from any organization or entity that regularly

compiles similar data for businesses in the private sector.

(d)(1)(A) This paragraph applies with respect to the five metropolitan statistical areas described in paragraph (3) which—

(i) have the highest levels of nonfarm employment (as

determined based on data made available by the Bureau of

Labor Statistics); and

(ii) as of the date of the enactment of this Act, have not

previously been surveyed by the Bureau of Labor Statistics

(as discrete pay localities) for purposes of section 5304 of title

5, United States Code.

(B) The President’s pay agent, based on such comparisons under

subsection (b) as the pay agent considers appropriate, shall: (i)

determine whether any of the five areas under subparagraph (A)

warrants designation as a discrete pay locality; and (ii) if so, make

recommendations as to what level of comparability payments would

be appropriate during 2002 for each area so determined.

(C)(i) Any recommendations under subparagraph (B)(ii) shall

be included—

(I) in the pay agent’s report under section 5304(d)(1) of

title 5, United States Code, submitted for purposes of comparability payments scheduled to become payable in 2002; or

(II) if compliance with subclause (I) is impracticable, in

a supplementary report which the pay agent shall submit to

the President and the Congress no later than March 1, 2001.

(ii) In the event that the recommendations are completed in

time to be included in the report described in clause (i)(I), a copy

of those recommendations shall be transmitted by the pay agent

to the Congress contemporaneous with their submission to the

President.

(D) Each of the five areas under subparagraph (A) that so

warrants, as determined by the President’s pay agent, shall be

designated as a discrete pay locality under section 5304 of title

5, United States Code, in time for it to be treated as such for

purposes of comparability payments becoming payable in 2002.

(2) The President’s pay agent may, at any time after the 180th

day following the submission of the report under subsection (f ),

make any initial or further determinations or recommendations

under this section, based on any pay comparisons under subsection

(b), with respect to any area described in paragraph (3).

(3) An area described in this paragraph is any metropolitan

statistical area within the continental United States that (as determined based on data made available by the Bureau of Labor Statistics and the Office of Personnel Management, respectively) has

a high level of nonfarm employment and at least 2,500 General

Schedule employees whose post of duty is within such area.

(e)(1) The authority under this section to make pay comparisons

and to make any determinations or recommendations based on

such comparisons shall be available to the President’s pay agent

only for purposes of comparability payments becoming payable on

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–167

or after January 1, 2002, and before January 1, 2007, and only

with respect to areas described in subsection (d)(3).

(2) Any comparisons and recommendations so made shall, if

included in the pay agent’s report under section 5304(d)(1) of title

5, United States Code, for any year (or the pay agent’s supplementary report, in accordance with subsection (d)(1)(C)(i)(II)), be

considered and acted on as the pay agent’s comparisons and recommendations under such section 5304(d)(1) for the area and the

year involved.

(f )(1) No later than March 1, 2001, the President’s pay agent

shall submit to the Committee on Government Reform of the House

of Representatives, the Committee on Governmental Affairs of the

Senate, and the Committees on Appropriations of the House of

Representatives and of the Senate, a report on the use of pay

comparison data, as described in subsection (b)(2) or (3) (as appropriate), for purposes of comparability payments.

(2) The report shall include the cost of obtaining such data,

the rationale underlying the decisions reached based on such data,

and the relative advantages and disadvantages of using such data

(including whether the effort involved in analyzing and integrating

such data is commensurate with the benefits derived from their

use). The report may include specific recommendations regarding

the continued use of such data.

(g)(1) No later than May 1, 2001, the President’s pay agent

shall prepare and submit to the committees specified in subsection

(f )(1) a report relating to the ongoing efforts of the Office of Personnel Management, the Office of Management and Budget, and the

Bureau of Labor Statistics to revise the methodology currently

being used by the Bureau of Labor Statistics in performing its

surveys under section 5304 of title 5, United States Code.

(2) The report shall include a detailed accounting of any concerns the pay agent may have regarding the current methodology,

the specific projects the pay agent has directed any of those agencies

to undertake in order to address those concerns, and a time line

for the anticipated completion of those projects and for implementation of the revised methodology.

(3) The report shall also include recommendations as to how

those ongoing efforts might be expedited, including any additional

resources which, in the opinion of the pay agent, are needed in

order to expedite completion of the activities described in the preceding provisions of this subsection, and the reasons why those additional resources are needed.

SEC. 638. FEDERAL FUNDS IDENTIFIED. Any request for proposals, solicitation, grant application, form, notification, press release,

or other publications involving the distribution of Federal funds

shall indicate the agency providing the funds and the amount

provided. This provision shall apply to direct payments, formula

funds, and grants received by a State receiving Federal funds.

SEC. 639. MANDATORY REMOVAL FROM EMPLOYMENT OF FEDERAL

LAW ENFORCEMENT OFFICERS CONVICTED OF FELONIES.

(a) IN GENERAL.—Chapter 73 of title 5, United States Code,

is amended by adding after subchapter VI the following:

114 STAT. 2763A–168 PUBLIC LAW 106–554—APPENDIX C

‘‘SUBCHAPTER VII—MANDATORY REMOVAL FROM EMPLOYMENT OF CONVICTED LAW ENFORCEMENT OFFICERS

‘‘§ 7371. Mandatory removal from employment of law enforcement officers convicted of felonies

‘‘(a) In this section, the term— ‘‘(1) ‘conviction notice date’ means the date on which an

agency that employs a law enforcement officer has notice that

the officer has been convicted of a felony that is entered by

a Federal or State court, regardless of whether that conviction

is appealed or is subject to appeal; and ‘‘(2) ‘law enforcement officer’ has the meaning given that

term under section 8331(20) or 8401(17).

‘‘(b) Any law enforcement officer who is convicted of a felony

shall be removed from employment as a law enforcement officer

on the last day of the first applicable pay period following the

conviction notice date.

‘‘(c)(1) This section does not prohibit the removal of an individual from employment as a law enforcement officer before a conviction notice date if the removal is properly effected other than

under this section.

‘‘(2) This section does not prohibit the employment of any

individual in any position other than that of a law enforcement

officer.

‘‘(d) If the conviction is overturned on appeal, the removal

shall be set aside retroactively to the date on which the removal

occurred, with back pay under section 5596 for the period during

which the removal was in effect, unless the removal was properly

effected other than under this section. ‘‘(e)(1) If removal is required under this section, the agency

shall deliver written notice to the employee as soon as practicable,

and not later than 5 calendar days after the conviction notice

date. The notice shall include a description of the specific reasons

for the removal, the date of removal, and the procedures made

applicable under paragraph (2). ‘‘(2) The procedures under section 7513(b)(2), (3), and (4), (c),

(d), and (e) shall apply to any removal under this section. The

employee may use the procedures to contest or appeal a removal,

but only with respect to whether—

‘‘(A) the employee is a law enforcement officer;

‘‘(B) the employee was convicted of a felony; or

‘‘(C) the conviction was overturned on appeal.

‘‘(3) A removal required under this section shall occur on the

date specified in subsection (b) regardless of whether the notice

required under paragraph (1) of this subsection and the procedures

made applicable under paragraph (2) of this subsection have been

provided or completed by that date.’’.

(b) TECHNICAL AND CONFORMING AMENDMENT.—The table of

sections for chapter 73 of title 5, United States Code, is amended

by adding after the item relating to section 7363 the following:

‘‘SUBCHAPTER VII—MANDATORY REMOVAL FROM EMPLOYMENT OF

CONVICTED LAW ENFORCEMENT OFFICERS

‘‘7371. Mandatory removal from employment of law enforcement officers convicted

of felonies.’’.

(c) EFFECTIVE DATE.—The amendments made by this section

shall take effect 30 days after the date of enactment of this Act

PUBLIC LAW 106–554—APPENDIX C 114 STAT. 2763A–169

and shall apply to any conviction of a felony entered by a Federal

or State court on or after that date.

SEC. 640. Section 504 of the Department of Transportation

and Related Agencies Appropriations Act, 2001 (as enacted into

law by Public Law 106–346) is repealed.

SEC. 641. (a) Section 5545b(d) of title 5, United States Code,

is amended by inserting at the end the following new paragraph: ‘‘(4) Notwithstanding section 8114(e)(1), overtime pay for

a firefighter subject to this section for hours in a regular

tour of duty shall be included in any computation of pay under

section 8114.’’. (b) The amendment in subsection (a) shall be effective as if

it had been enacted as part of the Federal Firefighters Overtime

Pay Reform Act of 1998 (112 Stat. 2681–519).

SEC. 642. Section 6323(a) of title 5, United States Code, is

amended by adding at the end the following: ‘‘(3) The minimum charge for leave under this subsection

is one hour, and additional charges are in multiples thereof.’’. SEC. 643. Section 616 of the Treasury, Postal Service and

General Government Appropriations Act, 1988, as contained in

the Act of December 22, 1987 (40 U.S.C. 490b), is amended by

adding at the end the following:

‘‘(e)(1) All existing and newly hired workers in any child care

center located in an executive facility shall undergo a criminal

history background check as defined in section 231 of the Crime

Control Act of 1990 (42 U.S.C. 13041).

‘‘(2) For purposes of this subsection, the term ‘executive facility’

means a facility that is owned or leased by an office or entity

within the executive branch of the Government (including one that

is owned or leased by the General Services Administration on

behalf of an office or entity within the judicial branch of the Government).

‘‘(3) Nothing in this subsection shall be considered to apply

with respect to a facility owned by or leased on behalf of an

office or entity within the legislative branch of the Government.’’. SEC. 644. Section 501 of the Department of Transportation

and Related Agencies Appropriations Act, 2001 (as enacted into

law by Public Law 106–346) is amended by striking subsection

(c) and by redesignating subsection (d) as subsection (c).

SEC. 645. (a)(1) Title 5, United States Code, is amended by

inserting after section 5372a the following:

‘‘§ 5372b. Administrative appeals judges

‘‘(a) For the purpose of this section—

‘‘(1) the term ‘administrative appeals judge position’ means

a position the duties of which primarily involve reviewing

decisions of administrative law judges appointed under section

3105; and

‘‘(2) the term ‘agency’ means an Executive agency, as

defined by section 105, but does not include the General

Accounting Office.

‘‘(b) Subject to such regulations as the Office of Personnel

Management may prescribe, the head of the agency concerned shall

fix the rate of basic pay for each administrative appeals judge

position within such agency which is not classified above GS–

15 pursuant to section 5108.

‘‘(c) A rate of basic pay fixed under this section shall be—

114 STAT. 2763A–170 PUBLIC LAW 106–554—APPENDIX C

‘‘(1) not less than the minimum rate of basic pay for level

AL–3 under section 5372; and

‘‘(2) not greater than the maximum rate of basic pay for

level AL–3 under section 5372.’’.

(2) Section 7323(b)(2)(B)(ii) of title 5, United States Code, is

amended by striking ‘‘or 5372a’’ and inserting ‘‘5372a, or 5372b’’.

(3) The table of sections for chapter 53 of title 5, United States

Code, is amended by inserting after the item relating to section

5372a the following:

‘‘5372b. Administrative appeals judges.’’.

(b) The amendment made by subsection (a)(1) shall apply with

respect to pay for service performed on or after the first day of

the first applicable pay period beginning on or after— (1) the 120th day after the date of the enactment of this

Act; or

(2) if earlier, the effective date of regulations prescribed

by the Office of Personnel Management to carry out such

amendment.

SEC. 646. Not later than 60 days after the date of enactment

of this Act, the Inspector General of each department or agency

shall submit to Congress a report that discloses any activity of

the applicable department or agency relating to—

(1) the collection or review of singular data, or the creation

of aggregate lists that include personally identifiable information, about individuals who access any Internet site of the

department or agency; and

(2) entering into agreements with third parties, including

other government agencies, to collect, review, or obtain aggregate lists or singular data containing personally identifiable

information relating to any individual’s access or viewing habits

for governmental and nongovernmental Internet sites.

This Act may be cited as the ‘‘Treasury and General Government Appropriations Act, 2001’’.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–171

APPENDIX D—H.R. 5666

That the following sums are appropriated, out of any money in

the Treasury not otherwise appropriated, for the fiscal year ending

September 30, 2001, and for other purposes, namely:

DIVISION A

CHAPTER 1

GENERAL PROVISIONS—THIS CHAPTER

SEC. 101. The Agriculture, Rural Development, Food and Drug

Administration, and Related Agencies Appropriations Act, 2001,

is amended—

(1) In title III, under the heading ‘‘Rural Utilities Service,

Rural Electrification and Telecommunications Loans Program

Account’’, after ‘‘per year’’ insert ‘‘: Provided further, That not

more than $100,000 shall be available for guarantees of private

sector loans’’.

(2) In title III, at the end of the first proviso under the

‘‘Rural Housing Assistance Grants’’ account, insert ‘‘in Mississippi and Alaska’’.

(3) In section 724, by striking ‘‘to Hispanic-serving institutions’’ and all that follows through ‘‘maintained by such institutions’’ and inserting ‘‘to eligible grantees specified in subsection

(d)(3) of that section’’;

(4) In title VIII, under the heading ‘‘Rural Community

Advancement Program’’, by striking ‘‘January 1, 2001’’ and

inserting ‘‘January 1, 2000’’;

(5) In section 806, by inserting ‘‘: Provided further, That

of the funds made available by this section, the Secretary

shall transfer $5,000,000 to the State of Alabama to be used

in conjunction with the program administered by the Alabama

Department of Agriculture and Industries: Provided further,

That of the funds made available by this section, the Secretary

shall transfer not more than $300,000 to the State of Montana

for transportation needs associated with emergency haying and

feeding: Provided further, That of the funds made available

by this section, the Secretary shall use not more than

$2,000,000 to carry out a program for income losses sustained

before April 30, 2001, by individuals who raise poultry owned

by other individuals as a result of Poult Enteritis Mortality

Syndrome control programs, as determined by the Secretary’’

after ‘‘American Indian Livestock Feed Program’’;

(6) In section 815(d)(3), by inserting ‘‘affected’’ after ‘‘all’’;

114 STAT. 2763A–172 PUBLIC LAW 106–554—APPENDIX D

(7) In section 830, by striking ‘‘section 401’’ and inserting ‘‘title IV’’. (8) In section 843, by striking ‘‘were unable to market

the crops’’ and all that follows through ‘‘in this section:’’ and

inserting ‘‘suffered a loss because of the insolvency of an agriculture cooperative in the State of California: Provided, That

the amount of a payment made to a producer under this section

shall not exceed 50 percent of the loss referred to in this

section:’’;

(9) In section 844—

(A) in the section heading, by inserting ‘‘, FLUECURED, AND CIGAR BINDER TYPE 54–55’’ after ‘‘BURLEY’’; and

(B) in subsection (a)—

(i) in paragraph (1)—

(I) by inserting ‘‘, without further cost to the

association,’’ after ‘‘settle’’; and

(II) by inserting ‘‘, Flue-cured, or Cigar Binder

Type 54–55’’ after ‘‘Burley’’ each place it appears;

(ii) in paragraph (2)(B), by inserting ‘‘, Flue-cured,

Cigar Binder Type 54–55,’’ after ‘‘Burley’’; and

(iii) in paragraph (3), by striking subparagraph

(A) and inserting the following:

‘‘(A) counted for the purpose of determining the Burley,

Flue-cured, or Cigar Binder Type 54–55 tobacco quota or

allotment for any year under part I of subtitle B of title

III of the Agricultural Adjustment Act of 1938 (7 U.S.C.

1311 et seq.); or’’;

(10) Notwithstanding any other provision of law, section

204(b)(10)(B) of Public Law 106–224 shall not be effective until

July 1, 2001; and

(11) The effective date of this section is the date of enactment of the Agriculture, Rural Development, Food and Drug

Administration, and Related Agencies Appropriations Act, 2001.

SEC. 102. The second sentence of section 520 of the Housing

Act of 1949 (42 U.S.C. 1490) is amended by striking ‘‘1990 decennial

census’’ and inserting ‘‘1990 or 2000 decennial census’’, and by

striking ‘‘year 2000’’ and inserting ‘‘year 2010’’.

SEC. 103. The Secretary of Agriculture, in collaboration with

the Secretaries of Energy and Interior, shall undertake a study

of the feasibility of including ethanol, biodiesel, and other biobased fuels as part of the Strategic Petroleum Reserve. This study

shall include a review of legislative and regulatory changes needed

to allow this inclusion, and those elements necessary to design

and implement such a program, including cost. The Secretary shall

provide this study to the House and Senate Appropriations Committees by February 15, 2001.

SEC. 104. Notwithstanding section 730 of the Agriculture, Rural

Development, Food and Drug Administration, and Related Agencies

Appropriations Act, 2000 (Public Law 106–78), the City of Wilson,

North Carolina, shall be eligible in fiscal year 2001 for the community facility loan guarantee program under section 306(a)(1) of

the Consolidated Farm and Rural Development Act.

SEC. 105. Title VIII of the Agriculture, Rural Development,

Food and Drug Administration, and Related Agencies Appropriations Act, 2001, is amended by inserting at the end the following

new section:

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–173

‘‘SEC. 778. Notwithstanding section 723 of this Act or any other provision of law, there are hereby appropriated $26,000,000,

to remain available until expended, for the program authorized

under section 334 of the Federal Agriculture Improvement and

Reform Act of 1996: Provided, That the entire amount shall be

available only to the extent an official budget request for

$26,000,000, that includes designation of the entire amount of the

request as an emergency requirement as defined in the Balanced

Budget and Emergency Deficit Control Act of 1985, as amended,

is transmitted by the President to the Congress: Provided further,

That the entire amount is designated by the Congress as an emergency requirement pursuant to section 251(b)(2)(A) of such Act.’’.

SEC. 106. In carrying out the bovine tuberculosis eradication

program covered by the Secretary of Agriculture’s emergency declaration effective as of October 11, 2000, the Secretary of Agriculture

shall pay 100 percent of the amounts of approved claims for materials affected by or exposed to bovine tuberculosis, and of approved

claims growing out of the destruction of animals: Provided, That

in calculating the net present value of the future income portion

of any claim, the Secretary shall use a discount rate of 7 percent:

Provided further, That the entire amount necessary to carry out

this section shall be available only to the extent that an official

budget request for the entire amount, that includes designation

of the entire amount of the request as an emergency requirement

as defined in the Balanced Budget and Emergency Deficit Control

Act of 1985, as amended, is transmitted by the President to the

Congress: Provided further, That the entire amount is designated

by the Congress as an emergency requirement pursuant to section

251(b)(2)(A) of such Act.

SEC. 107. Section 820(b) of the Agriculture, Rural Development,

Food and Drug Administration, and Related Agencies Appropriations Act, 2001, is amended by striking ‘‘of 1996’’ and inserting

the following: ‘‘of 1996, and for the Farmland Protection Program

established under section 388 of the Federal Agriculture Improvement and Reform Act of 1996’’. SEC. 108. For an additional amount for the United States

Department of Agriculture, Office of the General Counsel, $500,000:

Provided, That the entire amount shall be available only to the

extent an official budget request for $500,000, that includes designation of the entire amount of the request as an emergency requirement as defined in the Balanced Budget and Emergency Deficit

Control Act of 1985, as amended, is transmitted by the President

to the Congress: Provided further, That the entire amount is designated by the Congress as an emergency requirement pursuant

to section 251(b)(2)(A) of such Act.

SEC. 109. For an additional amount for Grain Inspection, Packers and Stockyards Administration, Salaries and Expenses,

$200,000: Provided, That the entire amount shall be available only

to the extent an official budget request for $200,000, that includes

designation of the entire amount of the request as an emergency

requirement as defined in the Balanced Budget and Emergency

Deficit Control Act of 1985, as amended, is transmitted by the

President to the Congress: Provided further, That the entire amount

is designated by the Congress as an emergency requirement pursuant to section 251(b)(2)(A) of such Act.

SEC. 110. Notwithstanding any other provision of law, the

Natural Resources Conservation Service may provide financial and

114 STAT. 2763A–174 PUBLIC LAW 106–554—APPENDIX D

technical assistance to the Hamakua Ditch project in Hawaii from

funds available for the Emergency Watershed Program, not to

exceed $3,000,000.

CHAPTER 2

DEPARTMENT OF JUSTICE

FEDERAL PRISON SYSTEM

SALARIES AND EXPENSES

For an additional amount for ‘‘Salaries and Expenses’’, $500,000, to remain available until expended: Provided, That these

funds are to be expended by the National Institute of Corrections

(NIC) for a comprehensive assessment of medical care and incidents

of inmate mortality in the Wisconsin State Prison System.

OFFICE OF JUSTICE PROGRAMS

JUSTICE ASSISTANCE

For an additional amount for ‘‘Justice Assistance’’, $300,000,

to remain available until expended: Provided, That these funds

are to be expended to expand the collection of data on prisoner

deaths while in law enforcement custody.

COMMUNITY ORIENTED POLICING SERVICES

For an additional amount for ‘‘Community Oriented Policing

Services’’, $3,080,000, to remain available until expended, of which

$1,880,000 shall be for a grant to the Pasadena, California, Police

Department for equipment; of which $200,000 shall be for a grant

to the City of Signal Hill, California, for equipment and technology

for an emergency operations center; and of which $1,000,000 shall

be for a grant to the State of Alabama Department of Forensic

Sciences for equipment.

JUVENILE JUSTICE PROGRAMS

For an additional amount for ‘‘Juvenile Justice Programs’’, $1,000,000, to remain available until expended, for a grant to Mobile

County, Alabama, for a juvenile court network program.

GENERAL PROVISIONS

SEC. 201. Chapter 2 of title II of division B of Public Law

106–246 (114 Stat. 542) is amended in the matter immediately

under the first heading—

(1) by inserting, ‘‘(or the State, in the case of New Mexico)’’

before ‘‘only’’; and

(2) by inserting, ‘‘detention costs,’’ after ‘‘court costs,’’.

SEC. 202. For an additional amount under the heading ‘‘United

States Attorneys, Salaries and Expenses’’ in the Departments of

Commerce, Justice, and State, the Judiciary, and Related Agencies

Appropriations Act, 2001, $10,000,000 for the State of Texas and

$2,000,000 for the State of Arizona, to reimburse county and municipal governments only for Federal costs associated with the handling

and processing of illegal immigration and drug and alien smuggling

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–175

cases, such reimbursements being limited to court costs, detention

costs, courtroom technology, the building of holding spaces, administrative staff, and indigent defense costs.

SEC. 203. In addition to amounts appropriated under the heading ‘‘State and Local Law Enforcement Assistance, Office of Justice

Programs’’ in the Departments of Commerce, Justice, and State,

the Judiciary, and Related Agencies Appropriations Act, 2001,

$9,000,000 is for an award to the Alliance of Boys & Girls of

South Carolina for the establishment of the Strom Thurmond Boys

& Girls Club National Training Center.

SEC. 204. In addition to any amounts made available for ‘‘State

and Local Law Enforcement Assistance’’ within the Department of Justice, $500,000 shall be made available only for the New

Hampshire Department of Safety to investigate and support the

prosecution of violations of Federal trucking laws.

SEC. 205. In addition to other amounts made available for

the COPS technology program of the Department of Justice,

$4,000,000 shall be available to the State of South Dakota to

establish a regional radio system to facilitate communications

between Federal, State, and local law enforcement agencies, firefighting agencies, and other emergency services agencies.

DEPARTMENT OF COMMERCE

ECONOMIC AND STATISTICAL ANALYSIS

SALARIES AND EXPENSES

For an additional amount for ‘‘Salaries and Expenses’’,

$200,000, to remain available until expended, for the establishment

of satellite accounts for the travel and tourism industry.

NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION

OPERATIONS, RESEARCH, AND FACILITIES

For an additional amount for ‘‘Operations, Research, and Facilities’’, $750,000, to remain available until expended, for a study

by the National Academy of Sciences pursuant to H.R. 2090, as

passed by the House of Representatives on September 12, 2000.

GENERAL PROVISIONS

SEC. 206. The Departments of Commerce, Justice, and State,

the Judiciary, and Related Agencies Appropriations Act, 2001, as

enacted by section 1(a)(2) of the Act entitled ‘‘An Act making appropriations for the government of the District of Columbia and other

activities chargeable in whole or in part against revenues of said

District for the fiscal year ending September 30, 2001, and for

other purposes’’ is amended by inserting before the period at the

end of the paragraph under the heading ‘‘National Oceanic and

Atmospheric Administration, Operations, Research, and Facilities’’ the following new proviso: ‘‘: Provided further, That, of the amounts

made available for the National Marine Fisheries Service under

this heading, $10,000,000 shall be available only for research

regarding litigation concerning the Alaska Steller sea lion and

Bering Sea/Aleutian Islands and Gulf of Alaska groundfish fisheries,

of which $6,000,000 shall be available only for the Office of Oceanic

114 STAT. 2763A–176 PUBLIC LAW 106–554—APPENDIX D

and Atmospheric Research to study the impact of ocean climate

shifts on the North Pacific and Bering Sea fish and marine mammal

species composition, of which $2,000,000 shall be available only

for the National Ocean Service to study predator/prey relationships

as they relate to the decline of the western population of Steller

sea lions, and of which $2,000,000 shall be available only for the

North Pacific Fishery Management Council for an independent

analysis of Steller sea lion science and other work related to such

litigation’’.

SEC. 207. (a) In addition to amounts appropriated or otherwise

made available under the heading ‘‘Operations, Research, and

Facilities, National Oceanic and Atmospheric Administration’’ in

the Departments of Commerce, Justice, and State, the Judiciary,

and Related Agencies Appropriations Act, 2001, $7,500,000 is appropriated for disaster assistance for communities affected by the 2000

western Alaska salmon disaster for which the Secretary of Commerce declared a fishery failure under section 312(a) of the Magnuson Stevens Fisheries Conservation and Management Act.

(b) Funds appropriated by this section shall be made available

as direct lump sum payments no later than 30 days after the

date of enactment of this Act, as follows: $3,500,000 to the Tanana

Chiefs Conference, $3,500,000 to the Association of Village Council

Presidents, and $500,000 to Kawerak.

(c) Such funds shall be used to provide personal assistance

with priority given to: (1) food; (2) energy needs; (3) housing assistance; (4) transportation fuel including for subsistence activities;

and (5) other urgent community needs.

(d) Not more than 5 percent of such funds may be used for

administrative expenses.

(e) The President of the Tanana Chiefs Conference, the President of the Association of Village Council Presidents, and the President of Kawerak shall disburse all funds no later than May 1,

2000 and shall submit a report to the Secretary of Commerce

detailing the expenditure of funds, including the number of persons

and households served and the amount of administrative costs,

by the end of the fiscal year.

SEC. 208. In addition to amounts appropriated or otherwise

made available by this or any other Act, $3,000,000 is appropriated

to enable the Secretary of Commerce to provide economic assistance

to fishermen and fishing communities affected by Federal closures

and fishing restrictions in the Hawaii long line fishery, to remain

available until expended.

SEC. 209. IMPLEMENTATION OF STELLER SEA LION PROTECTIVE

MEASURES.—

(a) FINDINGS.—The Congress finds that—

(1) the western population of Steller sea lions has substantially declined over the last 25 years.

(2) scientists should closely research and analyze all possible factors relating to such decline, including the possible

interactions between commercial fishing and Steller sea lions

and the localized depletion hypothesis;

(3) the authority to manage commercial fisheries in Federal

waters lies with the regional councils and the Secretary of

Commerce (hereafter in this section ‘‘Secretary’’) pursuant to

the Magnuson-Stevens Fishery Conservation and Management

Act (hereafter in this section ‘‘Magnuson-Stevens Act’’); and

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–177

(4) the Secretary of Commerce shall comply with the

Magnuson-Stevens Act when using fishery management plans

and regulations to implement the decisions made pursuant

to findings under the Endangered Species Act, and shall utilize

the processes and procedures of the regional fishery management councils as required by the Magnuson-Stevens Act.

(b) INDEPENDENT SCIENTIFIC REVIEW.—The North Pacific Fishery Management Council (hereafter in this section ‘‘North Pacific

Council) shall utilize the expertise of the National Academy of

Sciences to conduct an independent scientific review of the November 30, 2000 Biological Opinion for the Bering Sea/Aleutian Islands

and Gulf of Alaska groundfish fisheries (hereafter in this section

‘‘Biological Opinion’’), its underlying hypothesis, and the Reasonable

and Prudent Alternatives (hereafter in this section ‘‘Alternatives’’)

contained therein. The Secretary shall cooperate with the independent scientific review, and the National Academy of Sciences is

requested to give its highest priority to this review.

(c) PREPARATION OF FISHERY MANAGEMENT PLANS AND REGULATIONS TO IMPLEMENT PROTECTIVE MEASURES IN THE NOVEMBER

30, 2000 BIOLOGICAL OPINION.—

(1) The Secretary of Commerce shall submit to the North

Pacific Council proposed conservation and management measures to implement the Alternatives contained in the November

30, 2000 Biological Opinion for the Bering Sea/Aleutian Islands

and Gulf of Alaska groundfish fisheries. The North Pacific

Council shall prepare and transmit to the Secretary a fishery

management plan amendment or amendments to implement

such Alternatives that are consistent with the Magnuson-Stevens Act (including requirements in such Act relating to best

available science, bycatch reduction, impacting on fishing

communities, the safety of life at sea, and public comment

and hearings.)

(2) The Bering Sea/Aleutian Islands and Gulf of Alaska

groundfish fisheries shall be managed in a manner consistent

with the Alternatives contained in the Biological Opinion,

except as otherwise provided in this section. The Alternatives

shall become fully effective no later than January 1, 2002,

as revised if necessary and appropriate based on the independent scientific review referred to in subsection (b) and other

new information, and shall be phased in in 2001 as described

in paragraph (3).

(3) The 2001 Bering Sea/Aleutian Islands and Gulf of

Alaska groundfish fisheries shall be managed in accordance

with the fishery management plan and Federal regulations

in effect for such fisheries prior to July 15, 2000, including—

(A) conservative total allowable catch levels;

(B) no entry zones within three miles of rookeries;

(C) restricted harvest levels near rookeries and haulouts;

(D) federally-trained observers;

(E) spatial and temporal harvest restrictions;

(F) federally-mandated bycatch reduction programs;

and

(G) additional conservation benefits provided through

cooperative fishing arrangements,

and said regulations are hereby restored to full force and effect.

114 STAT. 2763A–178 PUBLIC LAW 106–554—APPENDIX D

(4) The Secretary shall amend these regulations by January

20, 2001, after consultation with the North Pacific Council

and in a manner consistent with all law, including the Magnuson-Stevens Act, and consistent with the Alternatives to the

maximum extent practicable, subject to the other provisions

of this subsection.

(5) The harvest reduction requirement (‘‘Global Control

Rule’’) shall take effect immediately in any 2001 groundfish

fishery in which it applies, but shall not cause a reduction

in the total allowable catch of any fishery of more than 10

percent.

(6) In enforcing regulations for the 2001 fisheries, the Secretary, upon recommendation of the North Pacific Council, may

open critical habitat where needed, adjust seasonal catch levels,

and take other measures as needed to ensure that harvest

levels are sufficient to provide income from these fisheries

for small boats and Alaskan on-shore processors that is no

less than in 1999.

(7) The regulations that are promulgated pursuant to paragraph (4) shall not be modified in any way other than upon

recommendation of the North Pacific Council, before March

15, 2001.

(d) SEA LION PROTECTION MEASURES.—$20,000,000 is hereby

appropriated to the Secretary of Commerce to remain available

until expended to develop and implement a coordinated, comprehensive research and recovery program for the Steller sea lion, which

shall be designed to study—

(1) available prey species;

(2) predator/prey relationships;

(3) predation by other marine mammals;

(4) interactions between fisheries and Steller sea lions,

including the localized depletion theory;

(5) regime shift, climate change, and other impacts associated with changing environmental conditions in the North

Pacific and Bering Sea;

(6) disease;

(7) juvenile and pup survival rates;

(8) population counts;

(9) nutritional stress;

(10) foreign commercial harvest of sealions outside the

exclusive economic zone;

(11) the residual impacts of former government-authorized

Steller sea lion eradication bounty programs; and

(12) the residual impacts of intentional lethal takes of

Steller sea lions.

Within available funds the Secretary shall implement on a pilot

basis innovative non-lethal measures to protect Steller sea lions

from marine mammal predators including killer whales.

(e) ECONOMIC DISASTER RELIEF.—$30,000,000 is hereby appropriated to the Secretary of Commerce to make available as a direct

payment to the Southwest Alaska Municipal Conference to distribute to fishing communities, businesses, community development

quota groups, individuals, and other entities to mitigate the economic losses caused by Steller sea lion protection measures heretofore incurred; provided that the President of such organization

shall provide a written report to the Secretary and the House

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–179

and Senate Appropriations Committee within 6 months of receipt

of these funds.

DEPARTMENT OF STATE AND RELATED AGENCY

GENERAL PROVISIONS

SEC. 210. In addition to any amounts made available for ‘‘Educational and Cultural Exchange Programs within the Department

of State’’, $500,000 shall be made available only for the Irish

Institute.

SEC. 211. In addition to amounts appropriated under the heading ‘‘International Broadcasting Operations, Broadcasting Board of

Governors’’ in the Departments of Commerce, Justice, and State,

the Judiciary, and Related Agencies Appropriations Act, 2001,

$10,000,000 to remain available until expended, for increased broadcasting to Russia and surrounding areas, and to China, by Radio

Free Europe/Radio Liberty, Radio Free Asia, and the Voice of America: Provided, That any amount of such funds may be transferred

to the ‘‘Broadcasting Capital Improvements’’ account to carry out

such purposes.

RELATED AGENCIES

COMMISSION ON ONLINE CHILD PROTECTION

For necessary expenses of the Commission on Online Child

Protection, $750,000, to remain available until expended.

SMALL BUSINESS ADMINISTRATION

SALARIES AND EXPENSES

For an additional amount for ‘‘Salaries and Expenses’’,

$1,000,000 shall be available for a grant to the Electronic Commerce

Resource Center in Scranton, Pennsylvania, to establish an electronic commerce technology distribution center.

GENERAL PROVISION

SEC. 212. For an additional amount for ‘‘Small Business

Administration, Salaries and Expenses’’, $1,000,000 shall be made

available only for a grant to the National Museum of Jazz in

New York, New York.

GENERAL PROVISION—THIS CHAPTER

SEC. 213. (a) The provisions of H.R. 5548 (as enacted into

law by H.R. 4942 of the 106th Congress) are amended as follows:

(1) In title I, under the heading ‘‘Salaries and Expenses,

United States Marshals Service’’, by striking ‘‘3,947’’ and inserting ‘‘4,034’’.

(2) In title I, by redesignating sections 114 through 119

as sections 113 through 118, respectively.

(3) In title II, under the heading ‘‘National Oceanic and

Atmospheric Administration—Operations, Research, and Facilities’’, by striking ‘‘$31,439,000’’ and inserting ‘‘$32,054,000’’.

(4) In title II, under the heading ‘‘National Oceanic and

Atmospheric Administration—Coastal and Ocean Activities’’—

114 STAT. 2763A–180 PUBLIC LAW 106–554—APPENDIX D

(A) by striking ‘‘non-contiguous States except Hawaii’’ and inserting ‘‘Alaska’’;

(B) by striking ‘‘Inc,’’ and inserting ‘‘Inc.,’’;

(C) by striking ‘‘scrup;’’ and inserting ‘‘scrub;’’; and

(D) by striking ‘‘watershed for lower Rouge River restoration:’’ and inserting ‘‘watershed:’’.

(5) In title IV, by striking section 406 and by redesignating

sections 407 and 408 as sections 406 and 407, respectively.

(6) In title VI, by striking sections 635 and 636.

(7) In title IX, in the first proviso of section 901, by striking

‘‘, territory or an Indian Tribe’’ and inserting ‘‘or territory’’.

(b) The amendments made by this section shall take effect

as if included in H.R. 4942 of the 106th Congress on the date

of its enactment.

CHAPTER 3

DEPARTMENT OF DEFENSE

GENERAL PROVISIONS—THIS CHAPTER

SEC. 301. In the event that award of the full funding contract

for low-rate initial production of the F–22 aircraft is delayed beyond

December 31, 2000 because of inability to complete the requirements

specified in section 8124 of the Department of Defense Appropriations Act, 2001 (Public Law 106–259), the Secretary of the Air

Force may obligate up to $353,000,000 of the funds appropriated

in title III of Public Law 106–259 to continue F–22 Lot 1 (10

aircraft) advance procurement to protect the supplier base and

preserve program costs and schedule.

SEC. 302. (a) Consistent with Executive Order Number 1733,

dated March 3, 1913, and notwithstanding section 303 of the Alaska

National Interest Lands Conservation Act, Public Law 96–487, or

any other law, the Department of the Air Force shall have primary

jurisdiction, custody, and control over Shemya Island and its appurtenant waters (including submerged lands). In exercising such primary jurisdiction, custody, and control, the Secretary of the Air

Force may utilize and apply such authorities as are generally

applicable to a military installation, base, camp, post, or station.

Shemya Island and its appurtenant waters (including submerged

lands) shall continue to be included within the Alaska Maritime

National Wildlife Refuge and the National Wildlife Refuge System

and the Secretary of the Interior shall have jurisdiction secondary

to that of the Department of the Air Force. Nothing in this section

shall prohibit the transfer of jurisdiction, custody, and control over

Shemya Island by the Department of the Air Force to another

military department. In the event the military department exercising such primary jurisdiction, custody, and control no longer has

a need to exercise such primary jurisdiction, custody, and control

of Shemya Island and its appurtenant waters (including submerged

lands), such jurisdiction, custody, and control shall terminate and

the Secretary of the Interior shall then exercise sole jurisdiction,

custody, and control over Shemya Island and its appurtenant waters

(including submerged lands) as part of the Alaska Maritime

National Wildlife Refuge.

(b) Any environmental contamination of Shemya Island caused

by a military department shall be the responsibility of that military

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–181

department and not the responsibility of the Department of the

Interior. Any money rentals received by a military department

from outgrants on Shemya Island will be applied to the environmental restoration of the island in accordance with 10 U.S.C. 2667.

(c) This section shall not be construed as altering any existing

property rights of the State of Alaska or any private person.

(d) The military department exercising primary jurisdiction,

custody, and control over Shemya Island shall, consistent with

the accomplishment of the military mission and subject to section

21 of the Internal Security Act of 1950, Public Law 81–831 (50

U.S.C. 797) (also known as the Subversive Activities Control Act

of 1950)—

(1) work with the United States Fish and Wildlife Service

to protect and conserve the wildlife and habitat on the island;

and

(2) grant access to Shemya Island and its appurtenant

waters to the United States Fish and Wildlife Service for the

purpose of management of the Alaska Maritime National Wildlife Refuge.

SEC. 303. Within the funds appropriated for the Patriot PAC–

3 program under title III of the Department of Defense Appropriations Act, 2001 (Public Law 106–259), the Ballistic Missile Defense

Organization shall procure no less than 40 PAC–3 missiles.

SEC. 304. Section 8133 of Public Law 106–259 (114 Stat. 703)

is amended by striking ‘‘$300,000,000’’ in the first proviso and

inserting ‘‘$550,000,000’’.

(TRANSFER OF FUNDS)

SEC. 305. Of the total amount appropriated by title II of the

Department of Defense Appropriations Act, 2001 (Public Law 106– 259) for operation and maintenance for the Armed Force or Armed

Forces under the jurisdiction of the Secretary of a military department, the Secretary of that military department may transfer up

to $2,000,000 to the central fund established by the Secretary

under section 2493(d) of title 10, United States Code, for funding

Fisher Houses and Fisher Suites. Amounts so transferred shall

be merged with other amounts in the central fund to which transferred and shall be available without fiscal year limitation for

the purposes for which amounts in that fund are available.

SEC. 306. FUNDING FOR CERTAIN COSTS OF VESSEL TRANSFERS. There is hereby appropriated into the Defense Vessels Transfer

Program Account such sums as may be necessary for the costs

(as defined in section 502 of the Congressional Budget Act of 1974

(2 U.S.C. 661a)) of the lease-sale transfers authorized by the

National Defense Authorization Act, 2001. Funds in that account

are available only for the purpose of covering those costs.

SEC. 307. Of the total amount appropriated by title IV of

the Department of Defense Appropriations Act, 2001 (Public Law

106–259) under the heading ‘‘Research, Development, Test and

Evaluation, Defense-Wide’’, not less than $5,000,000 shall be made

available only for support of a Gulf War illness research program

at the University of Texas Southwestern Medical Center.

(INCLUDING TRANSFER OF FUNDS)

SEC. 308. In addition to amounts appropriated for the Department of Defense in the Department of Defense Appropriations Act,

114 STAT. 2763A–182 PUBLIC LAW 106–554—APPENDIX D

2001 (Public Law 106–259), $150,000,000 is hereby appropriated

for ‘‘Operation and Maintenance, Navy’’ and shall remain available

until expended, only for costs associated with the repair of the

U.S.S. COLE: Provided, That the Secretary of Defense may transfer

these funds to appropriations accounts for procurement: Provided

further, That the funds transferred shall be merged with and shall

be available for the same purposes and for the same time period,

as the appropriation to which transferred: Provided further, That

the transfer authority provided in this section is in addition to

any other transfer authority available to the Department of Defense:

Provided further, That the welfare of the crew, and of the families

of the crew, of the U.S.S. COLE shall be considered in the Navy’s

selection of the process and location for the repair of the U.S.S.

COLE: Provided further, That the entire amount made available

in this section is designated by the Congress as an emergency

requirement pursuant to section 251(b)(2)(A) of the Balanced Budget

and Emergency Deficit Control Act of 1985, as amended.

SEC. 309. Notwithstanding any other provision of law, the

Administrator of the General Services Administration may utilize

funds available to the National Science and Technology Council

(authorized by Executive Order No. 12881), or any successor entity

to the council, under section 635 of the Treasury and General

Government Appropriations Act, 2001, for payment of any expenses

of, and shall ensure that administrative services, facilities, staff

and other support are provided for, the Commission on the Future

of the United States Aerospace Industry pursuant to section

1092(e)(1) of the Floyd D. Spence National Defense Authorization

Act for Fiscal Year 2001 (as enacted by section 1 of the Act to

authorize appropriations for fiscal year 2001 for military activities

of the Department of Defense, for military construction, and for

defense activities of the Department of Energy, to prescribe personnel strengths for such fiscal year for the Armed Forces, and for

other purposes).

SEC. 310. In addition to funds provided elsewhere in this Act,

or in the Department of Defense Appropriations Act, 2001 (Public

Law 106–259), $2,000,000 is hereby appropriated to ‘‘Operation

and Maintenance, Marine Corps’’, only for planning and National

Environmental Protection Act documentation for the proposed airfield and heliport at the Marine Corps Air Ground Task Force

Training Command.

(TRANSFER OF FUNDS)

SEC. 311. Of the funds made available in the Department

of Defense Appropriations Act, 2001 (Public Law 106–259), the

Secretary of the Air Force shall transfer $5,000,000 of the funds

provided for ‘‘Operation and Maintenance, Air Force’’ to the Secretary of the Interior for maintenance, protection, or preservation

of the land and interests in land described in section 3 of the

Minuteman Missile National Historic Site Establishment Act of

1999 (Public Law 106–115; 113 Stat. 1540): Provided, That the

transfer authority provided in this section is in addition to any

other transfer authority available to the Department of Defense

for fiscal year 2001.

SEC. 312. (a) The Secretary of the Air Force is authorized

to convey to the Roosevelt General Hospital, Portales, New Mexico,

without consideration, and without regard to title II of the Federal

Property and Administrative Services Act of 1949, all right, title,

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–183

and interest of the United States in any personal property of the

Air Force that the Secretary determines— (1) is appropriate for use by the Roosevelt General Hospital

in the operation of that hospital; and

(2) is excess to the needs of the Air Force.

(b) The Secretary may require any additional terms and conditions in connection with any conveyance under subsection (a) that

the Secretary considers appropriate to protect the interests of the

United States.

(INCLUDING TRANSFER OF FUNDS)

SEC. 313. In addition to amounts appropriated for the Department of Defense in the Department of Defense Appropriations Act,

2001 (Public Law 106–259), $100,000,000 is hereby appropriated

for ‘‘Overseas Contingency Operations Transfer Fund’’ and shall

remain available until expended: Provided, That the Secretary of

Defense may transfer the funds provided herein only to appropriations for military personnel; operation and maintenance; procurement; research, development, test and evaluation; and working

capital funds: Provided further, That the funds transferred shall

be merged with and shall be available for the same purposes and

for the same time period, as the appropriation to which transferred:

Provided further, That upon a determination that all or part of

the funds transferred from this appropriation are not necessary

for the purposes provided herein, such amounts may be transferred

back to this appropriation: Provided further, That the transfer

authority provided in this section is in addition to any other transfer

authority contained elsewhere in this Act: Provided further, That

funds appropriated by this section, or made available by the transfer

of funds in this section, for intelligence activities are deemed to

be specifically authorized by the Congress for the purposes of section

504 of the National Security Act of 1947 (50 U.S.C. 414) during

fiscal year 2001: Provided further, That the entire amount made

available in this section is designated by the Congress as an emergency requirement pursuant to section 251(b)(2)(A) of the Balanced

Budget and Emergency Deficit Control Act of 1985, as amended.

SEC. 314. Of the total amount appropriated by title IV of

the Department of Defense Appropriations Act, 2001 (Public Law

106–259) under the heading ‘‘Research, Development, Test and

Evaluation, Navy’’, up to $3,000,000 shall be made available to

the Marine Corps to pursue research in Nanotechnology for Consequence Management.

SEC. 315. Of the total amount appropriated by title IV of

the Department of Defense Appropriations Act, 2001 (Public Law

106–259) under the heading ‘‘Research, Development, Test and

Evaluation, Army’’, not less than $1,500,000 shall be made available

only for installation of the Medical Area Network for Virtual Technologies at Fort Detrick and Walter Reed Army Hospital, and

not less than $1,000,000 shall be made available only to conduct

a pilot study to determine the feasibility of establishing a Department of Defense Information Analysis Center for telemedicine.

SEC. 316. The Secretary of the Navy shall acquire 50 acres

of real property located on Reed Island, along the south shore

of the St. John’s River across from Blount Island Command,

Jacksonville, Florida. The Secretary of the Navy shall pay not

more than the fair market value of the property, to be determined

pursuant to an appraisal acceptable to the Secretary of the Navy;

114 STAT. 2763A–184 PUBLIC LAW 106–554—APPENDIX D

but in no case shall the price exceed $4,200,000: Provided, That

the exact acreage and legal description of the real property to

be acquired pursuant to this section shall be determined by a

survey satisfactory to the Secretary of the Navy: Provided further,

That the Secretary of the Navy may require such additional terms

and conditions in connection with the land acquisition pursuant

to this section as the Secretary considers appropriate to protect

the interests of the United States.

SEC. 317. Of the total amount appropriated by title IV of

the Department of Defense Appropriations Act, 2001 (Public Law

106–259) under the heading ‘‘Research, Development, Test, and

Evaluation, Navy’’ the Secretary of the Navy may establish Marine

Fire Training Centers at the Marine and Environmental Research

and Training Station and Barbers Point by grants or contracts.

SEC. 318. Notwithstanding any other provision of law, and

notwithstanding the provisions in section 7306 of title 10, United

States Code, of the funds provided in the Department of Defense

Appropriations Act, 2001 (Public Law 106–259) for ‘‘Operation and

Maintenance, Navy’’, $750,000 shall be available only for repair

of ex-Turner Joy.

SEC. 319. In addition to amounts appropriated or otherwise

made available for the Department of Defense elsewhere in this

Act or in the Department of Defense Appropriations Act, 2001

(Public Law 106–259), $2,000,000 is hereby appropriated under

the heading ‘‘Operation and Maintenance, Defense-Wide’’, to remain

available for obligation until September 30, 2001, only for the

Defense Imagery and Mapping Agency Program.

SEC. 320. None of the funds available in the Department of

Defense Appropriations Act, 2001 (Public Law 106–259) shall be

used to consolidate or incorporate Air Force radar operations

maintenance and support programs or contracts into an Air Force

SENSOR or a similar acquisition program.

SEC. 321. In addition to amounts appropriated elsewhere in

this Act, or in the Department of Defense Appropriations Act,

2001 (Public Law 106–259), $1,000,000 is hereby appropriated to ‘‘Research, Development, Test and Evaluation, Air Force’’, only to

develop rapid diagnostic and fingerprinting techniques along with

molecular monitoring systems for the detection of nosocomial infections.

SEC. 322. Of the total amount appropriated by title IV of

the Department of Defense Appropriations Act, 2001 (Public Law

106–259) under the heading ‘‘Research, Development, Test and

Evaluation, Navy’’, $1,500,000 shall be made available by grant

or contract only to the California Central Coast Research Partnership (C3RP).

SEC. 323. FORT IRWIN NATIONAL TRAINING CENTER EXPANSION.

(a) FINDINGS.—Congress makes the following findings:

(1) The National Training Center at Fort Irwin, California,

is the only instrumented training area in the world suitable

for live fire training of heavy brigade-sized military forces and

thus provides the Army with essential training opportunities

necessary to maintain and improve military readiness and promote national security.

(2) The National Training Center must be expanded to

meet the critical need of the Army for additional training

lands suitable for the maneuver of large numbers of military

personnel and equipment, which is necessitated by advances

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–185

in equipment, by doctrinal changes, and by Force XXI doctrinal

experimentation requirements.

(3) The lands being considered for expansion of the National

Training Center are home to the desert tortoise and other

species that are protected under the Endangered Species Act

of 1973, and the Secretary of Defense and the Secretary of

the Interior, in developing a plan for expansion of the National

Training Center, must provide for such expansion in a manner

that complies with the Endangered Species Act of 1973, the

National Environmental Policy Act of 1969, and other

applicable laws.

(4) In order for the expansion of the National Training

Center to be implemented on an expedited basis, the Secretaries

should proceed without delay to define with specificity the

key elements of the expansion plan, including obtaining early

input regarding national security requirements, Endangered

Species Act of 1973 compliance and mitigation, and National

Environmental Policy Act of 1969 compliance.

(b) PURPOSE.—The purpose of this section is to expedite the

expansion of the National Training Center at Fort Irwin, California,

in a manner that is fully compliant with environmental laws.

(c) PREPARATION OF PROPOSED EXPANSION PLAN.—

(1) PREPARATION REQUIRED.—The Secretary of the Army

and the Secretary of the Interior (in this section referred to

as the ‘‘Secretaries’’) shall jointly prepare a proposed plan for

the expansion of the National Training Center at Fort Irwin,

California.

(2) SUBMISSION AND AVAILABILITY.—The plan required by

paragraph (1) (in this section referred to as the ‘‘proposed

expansion plan’’) shall be completed not later than 120 days

after the date of the enactment of this Act. When completed,

the Secretaries shall make the proposed expansion plan available to the public and shall publish in the Federal Register

a ‘‘notice of availability’’ concerning the proposed expansion

plan.

(d) KEY ELEMENTS OF PROPOSED EXPANSION PLAN.—

(1) JOINT REPORT.—Not later than 45 days after the date

of the enactment of this Act, the Secretaries shall submit to

Congress a joint report that identifies the key elements of

the proposed expansion plan.

(2) LANDS WITHDRAWAL AND RESERVATION.—The proposed

expansion plan shall include the withdrawal and reservation

of an appropriate amount of public lands for—

(A) the conduct of combined arms military training

at the National Training Center;

(B) the development and testing of military equipment

at the National Training Center;

(C) other defense-related purposes; and

(D) conservation and research purposes.

(3) CONSERVATION MEASURES.—The proposed expansion

plan shall also include a general description of conservation

measures, anticipated to cost approximately $75,000,000, that

may be necessary and appropriate to protect and promote the

conservation of the desert tortoise and other endangered or

threatened species and their critical habitats in designated

wildlife management areas in the West Mojave Desert. The

conservation measures may include—

114 STAT. 2763A–186 PUBLIC LAW 106–554—APPENDIX D

(A) the establishment of one or more research natural

areas, which may include lands both within and outside

the National Training Center;

(B) the acquisition of private and State lands within

the wildlife management areas in the West Mojave Desert;

(C) the construction of barriers, fences, and other structures that would promote the conservation of endangered

or threatened species and their critical habitats;

(D) the funding of research studies; and

(E) other conservation measures.

(d) PRELIMINARY REVIEW OF EXPANSION PLAN.— (1) REVIEW REQUIRED.—Not later than 90 days after the

date of the enactment of this Act, the Director of the United

States Fish and Wildlife Service shall submit to the Secretaries

a preliminary review of the proposed expansion plan (as developed as of that date). In the preliminary review, the Director

shall identify, with as much specificity as possible, an approach

for implementing the proposed expansion plan consistent with

the Endangered Species Act of 1973 (16 U.S.C. 1531 et seq.).

(2) RELATION TO FORMAL REVIEW.—The preliminary review

under paragraph (1) shall not constitute a formal consultation

under section 7 of the Endangered Species Act of 1973 (16

U.S.C. 1536), but shall be used to assist the Secretaries in

more precisely defining the nature and scope of an expansion

plan for the National Training Center that is likely to satisfy

requirements of the Endangered Species Act of 1973 and to

expedite the formal consultation process under section 7 of

such Act.

(3) CONSIDERATION OF PRELIMINARY REVIEW.—In preparing

the proposed expansion plan, the Secretaries shall take into

account the content of the preliminary review by the Director

of the United States Fish and Wildlife Service under paragraph

(1).

(e) DRAFT LEGISLATION.—The Secretaries shall submit to Congress with the proposed expansion plan a draft of proposed legislation providing for the withdrawal and reservation of public lands

for the expansion of the National Training Center. It is the sense

of the Congress that the proposed legislation should contain a

provision that, if enacted, would prohibit ground-disturbing military

use of the land to be withdrawn and reserved by the legislation

until the Secretaries have certified that there has been full compliance with the appropriate provisions of the legislation, the Endangered Species Act of 1973, the National Environmental Policy Act

of 1969, and other applicable laws.

(f ) CONSULTATION UNDER ENDANGERED SPECIES ACT OF 1973.—

The Secretaries shall initiate the formal consultation required under

section 7 of the Endangered Species Act of 1973 (16 U.S.C. 1536)

with respect to expansion of the National Training Center as soon

as practicable and shall complete such consultation not later than

2 years after the date of the enactment of this Act.

(g) ENVIRONMENTAL REVIEW.—Not later than 6 months following completion of the formal consultation required under section

7 of the Endangered Species Act of 1973 with respect to expansion

of the National Training Center, the Secretaries shall complete

any analysis required under the National Environmental Policy

Act of 1969 with respect to the proposed expansion of the National

Training Center. The analysis shall be coordinated, to the extent

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–187

practicable and appropriate, with the review of the West Mojave

Coordinated Management Plan that, as of the date of the enactment

of this Act, is being undertaken by the Bureau of Land Management.

(h) FUNDING.— (1) IMPLEMENTATION OF CONSERVATION MEASURES.—There

are authorized to be appropriated $75,000,000 to the Secretary

of the Army for the implementation of conservation measures

necessary for the final expansion plan for the National Training

Center to comply with the Endangered Species Act of 1973.

(2) IMPLEMENTATION OF SECTION.—The amounts of

$2,500,000 for ‘‘Operation and Maintenance, Army’’ and

$2,500,000 for ‘‘Management of Lands and Resources, Bureau

of Land Management’’ are hereby appropriated to the Secretary

of the Army and the Secretary of the Interior, respectively,

only to undertake and complete on an expedited basis the

activities specified in this section.

CHAPTER 4

DISTRICT OF COLUMBIA FEDERAL FUNDS

FEDERAL PAYMENT TO THE DISTRICT OF COLUMBIA COURTS

For an additional amount for the District of Columbia courts

for capital repairs necessitated by the recent fire damage to the

courthouse facilities, $350,000, to remain available until September

30, 2002, and for an additional amount for such repairs for the

Superior Court of the District of Columbia, $50,000: Provided, That

after providing notice to the Committees on Appropriations of the

Senate and House of Representatives, the District of Columbia

courts may reallocate not more than $1,000,000 of the funds provided under this heading under the District of Columbia Appropriations Act, 2001, among the items and entities funded under such

heading for the costs of such repairs.

GENERAL PROVISIONS—THIS CHAPTER

SEC. 401. (a) Section 106(b) of the District of Columbia Public

Works Act of 1954 (sec. 43–1552(b), D.C. Code), as amended by

section 133 of the District of Columbia Appropriations Act, 1990,

is amended—

(1) in the third sentence of paragraph (1), by striking

‘‘United States Treasury and’’ and all that follows through

‘‘by the’’; and

(2) by adding at the end the following new paragraph:

‘‘(5) Not later than the 15th day of the month following each

quarter (beginning with the first quarter of fiscal year 2001), the

inspector general of each Federal department, establishment, or

agency receiving water services from the District of Columbia shall

submit a report to the Committees on Appropriations of the House

of Representatives and Senate analyzing the promptness of payment

with respect to the services furnished to such department, establishment, or agency.’’.

(b) Section 212(b) of the District of Columbia Public Works

Act of 1954 (sec. 43–1612(b), D.C. Code), as amended by section

133 of the District of Columbia Appropriations Act, 1990, is

amended—

114 STAT. 2763A–188 PUBLIC LAW 106–554—APPENDIX D

(1) in the third sentence of paragraph (1), by striking ‘‘United States Treasury and’’ and all that follows through ‘‘by the’’; and

(2) by adding at the end the following new paragraph:

‘‘(5) Not later than the 15th day of the month following each

quarter (beginning with the first quarter of fiscal year 2001), the

inspector general of each Federal department, establishment, or

agency receiving sanitary sewer services from the District of Columbia shall submit a report to the Committees on Appropriations

of the House of Representatives and Senate analyzing the promptness of payment with respect to the services furnished to such

department, establishment, or agency.’’.

(c) The amendments made by this section shall take effect

as if included in the enactment of section 133 of the District of

Columbia Appropriations Act, 1990.

SEC. 402. (a) The Act entitled ‘‘An Act donating certain Lots

in the City of Washington for Schools for Colored Children in

the District of Columbia’’, approved July 28, 1866 (14 Stat. 343),

is amended by striking the second sentence.

(b) Section 319 of the Revised Statutes of the United States

relating to the District of Columbia and Post Roads (sec. 31–206,

D.C. Code) is repealed.

SEC. 403. RESTRICTIONS ON USE OF ANNUAL UNOBLIGATED BALANCE IN D.C. CRIME VICTIMS COMPENSATION FUND. (a) IN GENERAL.—Section 16(d) of the Victims of Violent Crime Compensation

Act of 1996 (sec. 3–435(d), D.C. Code), as added by section 160(d)

of the District of Columbia Appropriations Act, 2000, is amended

to read as follows:

‘‘(d) Any unobligated balance existing in the Fund in excess

of $250,000 as of the end of each fiscal year (beginning with fiscal

year 2000) may be used only in accordance with a plan developed

by the District of Columbia and approved by the Committees on

Appropriations of the Senate and House of Representatives, the

Committee on Government Reform of the House of Representatives,

and the Committee on Governmental Affairs of the Senate, and

not less than 80 percent of such balance shall be used for direct

compensation payments to crime victims through the Fund under

this section and in accordance with this Act.’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall take effect September 30, 2000.

SEC. 404. (a) Notwithstanding any provision of the District

of Columbia Appropriations Act, 2001, the District of Columbia

may fund the programs identified under the heading ‘‘Reserve’’

in H.R. 4942, One Hundred Sixth Congress, as introduced, subject

to the conditions described under such heading and upon certification by the District of Columbia Financial Responsibility and

Management Assistance Authority to the Committees on Appropriations of the Senate and House of Representatives that the Chief

Financial Officer of the District of Columbia, the Mayor of the

District of Columbia, and the Council of the District of Columbia

have identified and implemented such spending reductions as may

be necessary to ensure that the District of Columbia will not have

a budget deficit for fiscal year 2001.

(b)(1) Notwithstanding any provision of the District of Columbia

Appropriations Act, 2001, the use by the District of the funds

described in paragraph (2) for Pay-As-You-Go Capital Funds shall

be optional.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–189

(2) The funds described in this paragraph are funds set aside

for the reserve established by section 202( j) of the District of

Columbia Financial Responsibility and Management Assistance Act

of 1995 (as amended by section 148 of the District of Columbia

Appropriations Act, 2000) which are not used for purposes of any

reserve funds established under the District of Columbia Appropriations Act, 2001, or any amendments made by such Act.

(c)(1) The Mayor of the District of Columbia shall deposit the

annual interest savings resulting from debt reductions using the

proceeds of the tobacco securitization program into the emergency

reserve fund established under section 450A of the District of

Columbia Home Rule Act (as added by section 159 of the District

of Columbia Appropriations Act, 2001).

(2) This subsection shall apply with respect to fiscal year 2001

and each succeeding fiscal year until the requirements of section

450A of the District of Columbia Home Rule Act have been met.

SEC. 405. (a) Notwithstanding any provision of the District

of Columbia Appropriations Act, 2001, quarterly disbursements

shall be calculated and paid to District of Columbia public charter

schools during fiscal year 2001 in accordance with section 107a(b)

of the Uniform Per Student Funding Formula for Public Schools

and Public Charter Schools and Tax Conformity Clarification

Amendment Act of 1998 (sec. 31–2906.1(b), D.C. Code), as amended

by the Enrollment Integrity Act.

SEC. 406. (a) The provisions of H.R. 5547 (as enacted into

law by H.R. 4942 of the 106th Congress) are repealed and shall

be deemed for all purposes (including section 1(b) of H.R. 4942)

to have never been enacted.

(b) The repeal made by this section shall take effect as if

included in H.R. 4942 of the 106th Congress on the date of its

enactment.

CHAPTER 5

ENERGY AND WATER DEVELOPMENT

DEPARTMENT OF DEFENSE—CIVIL

DEPARTMENT OF THE ARMY

CORPS OF ENGINEERS—CIVIL

GENERAL INVESTIGATIONS

For an additional amount for ‘‘General Investigations’’,

$900,000, to remain available until expended: Provided, That

$100,000 shall be available for a reconnaissance study of shore

protection needs at North Topsail Beach, North Carolina; $100,000

shall be available for a reconnaissance study for the Passiac County,

New Jersey, water infrastructure project; $100,000 shall be available for a reconnaissance study of flooding, drainage and other

related problems in the Cayuga Creek Watershed, New York; and

$600,000 shall be available for a cost-shared feasibility study of

the restoration of the lower St. Anthony’s Falls natural rapids

in Minnesota.

114 STAT. 2763A–190 PUBLIC LAW 106–554—APPENDIX D

CONSTRUCTION, GENERAL

For an additional amount for ‘‘Construction, General’’, $2,750,000, to remain available until expended: Provided, That

$75,000 shall be available for planning and design of a project

to provide for floodplain evacuation in the watershed of Pond Creek,

Kentucky; $100,000 shall be available for design of recreation and

access features at the Louisville Waterfront Park in Kentucky;

$500,000 shall be available for a Limited Reevaluation Report for

the Central Boca Raton segment of the Palm Beach County, Florida,

shore protection project; and $75,000 shall be available to conduct

research on the eradication of Eurasian water milfoil at Houghton

Lake, Michigan: Provided further, That the Secretary of the Army,

acting through the Chief of Engineers, is authorized and directed

to use $2,000,000 of the funds appropriated herein to initiate design

and construction of the Hawaii Water Management Project, including Waiahole Ditch on Oahu, Kau Ditch on Maui, Pioneer Mill

Ditch on Hawaii, and the complex system on the west side of

Kauai: Provided further, That the Secretary of the Army may use up to $5,000,000 of previously appropriated funds to carry out

the Abandoned and Inactive Noncoal Mine Restoration program

authorized by section 560 of Public Law 106–53.

FLOOD CONTROL, MISSISSIPPI RIVER AND TRIBUTARIES, ARKANSAS, IL- LINOIS, KENTUCKY, LOUISIANA, MISSISSIPPI, MISSOURI, AND TEN- NESSEE

For an additional amount for ‘‘Flood Control, Mississippi River

and Tributaries, Arkansas, Illinois, Kentucky, Louisiana, Mississippi, Missouri, and Tennessee’’, $3,500,000, to remain available

until expended, for prosecuting work of repair, restoration or

maintenance of the Mississippi River levees, and for the correction

of deficiencies in the mainline Mississippi River levees.

DEPARTMENT OF THE INTERIOR

BUREAU OF RECLAMATION

WATER AND RELATED RESOURCES

For an additional amount for ‘‘Water and Related Resources’’,

$2,000,000, to remain available until expended, for construction

of the Mid-Dakota Rural Water System, in addition to amounts

made available under the Energy and Water Appropriations

Development Act, 2001.

DEPARTMENT OF ENERGY

ENERGY PROGRAMS

ENERGY SUPPLY

For an additional amount for ‘‘Energy Supply’’, $800,000, to

remain available until expended, for the Prime, LLC, of central

South Dakota, for final engineering and project development of

the integrated ethanol complex, including an ethanol unit, waste

treatment system, and enclosed cattle feed lot.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–191

SCIENCE

For an additional amount for ‘‘Science’’, $1,000,000, to remain

available until expended, for high temperature superconducting

research and development at Boston College.

CHAPTER 6

GENERAL PROVISIONS—THIS CHAPTER

SEC. 601. Of the funds appropriated under the heading Department of State, International Narcotics Control and Law Enforcement, in the Foreign Operations, Export Financing, and Related

Programs Appropriations Act, 2001, not less than $1,350,000 shall

be available only for the Protection Project to continue its study

of international trafficking, prostitution, slavery, debt bondage, and

other abuses of women and children.

SEC. 602. EMBASSY COMPENSATION AUTHORITY. Funds made

available under the heading ‘‘Other Bilateral Economic Assistance,

Economic Support Fund’’ included in the Foreign Operations, Export

Financing, and Related Programs Appropriations Act, 2001 (Public

Law 106–429) may be made available, notwithstanding any other

provision of law, to provide payment to the Government of the

People’s Republic of China for property loss and damage arising

out of the May 7, 1999 incident in Belgrade, Federal Republic

of Yugoslavia.

CHAPTER 7

DEPARTMENT OF THE INTERIOR

BUREAU OF LAND MANAGEMENT

LAND ACQUISITION

For an additional amount for ‘‘Land Acquisition’’, $5,000,000,

to be derived from the Land and Water Conservation Fund and

to remain available until expended, to carry out the provisions

of title VI of the Steens Mountain Cooperative Management and

Protection Act (Public Law 106–399): Provided, That sums necessary to complete the individual land exchanges identified under

title VI shall be provided within 30 days of each land exchange.

UNITED STATES FISH AND WILDLIFE SERVICE

RESOURCE MANAGEMENT

For an additional amount for ‘‘Resource Management’’, $500,000

for a grant to the Center for Reproductive Biology at Washington

State University.

MULTINATIONAL SPECIES CONSERVATION FUND

For an additional amount for the ‘‘Multinational Species Conservation Fund’’, $750,000, to remain available until expended,

for Great Ape conservation activities authorized by law.

114 STAT. 2763A–192 PUBLIC LAW 106–554—APPENDIX D

NATIONAL PARK SERVICE

OPERATION OF THE NATIONAL PARK SYSTEM

For an additional amount for ‘‘Operation of the National Park

System’’, $100,000 for completion of studies related to the Arlington

Boathouse in Virginia.

NATIONAL RECREATION AND PRESERVATION

For an additional amount for ‘‘National Recreation and

Preservation’’, $1,600,000, to remain available until expended, of

which $500,000 is for the National Constitution Center in Philadelphia, Pennsylvania and $1,100,000 is for a grant to the Historic

New Bridge Landing Park Commission.

HISTORIC PRESERVATION FUND

For an additional amount for the ‘‘Historic Preservation Fund’’,

$100,000 for a grant to the Massillon Heritage Foundation, Inc.

in Massillon, Ohio.

CONSTRUCTION

For an additional amount for ‘‘Construction’’, $3,500,000, to

remain available until expended, of which $1,500,000 is for the

Stones River National Battlefield and $2,000,000 is for the Millennium Cultural Cooperative Park.

DEPARTMENT OF ENERGY

ENERGY CONSERVATION

For an additional amount for ‘‘Energy Conservation’’, $300,000,

to remain available until expended, for a grant to the Oak Ridge

National Laboratory/Nevada Test Site Development Corporation

for the development of: (1) cooling, refrigeration, and thermal energy

management equipment capable of using natural gas or hydrogen

fuels; and (2) improvement of the reliability of heat-activated cooling, refrigeration, and thermal energy management equipment used

in combined heating, cooling, and power applications.

RELATED AGENCY

WOODROW WILSON INTERNATIONAL CENTER FOR SCHOLARS

PAYMENT TO ENDOWMENT FUND

For payment to the endowment fund of the Woodrow Wilson

International Center for Scholars $5,000,000: Provided, That such

funds may be invested in investments approved by the Board of

Trustees of the Woodrow Wilson International Center for Scholars

and the income from such investments may be used to support

the programs of the Center that the Board of Trustees and the

Director of the Center determine appropriate.

GENERAL PROVISION—THIS CHAPTER

SEC. 701. In addition to amounts appropriated in Public Law

106–291 to the Indian Health Service under the heading ‘‘Indian

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–193

Health Services’’, $30,000,000, to remain available until expended,

is appropriated as follows:

(1) $15,000,000 shall be provided to the Alaska Federation

of Natives as a direct lump sum payment within 30 days

of enactment of this Act for its Alaska Native Sobriety and

Alcohol Control Program: Provided, That the President of the

Alaska Federation of Natives shall make grants to each Alaska

Native regional non-profit corporation (as listed in section

103(a)(2) of Public Law 104–193 (110 Stat. 2159)) in which

there are villages, including established villages and organized

cities under State law, that have voted to ban the sale, importation, or possession of alcohol pursuant to local option State

law: Provided further, That such grants shall be used to: (1)

employ Village Public Safety Officers (hereinafter referred to

as ‘‘VPSO’s’’) under such terms and conditions that encourage

retention of such VPSO’s and that are consistent with agreements with the State of Alaska for the provision of such VPSO

services; (2) acquisition of law enforcement equipment or services; or (3) develop and implement restorative justice programs

recognized under State sentencing law as a community-based

complement or alternative to incarceration or other penalty:

Provided further, That funds may also be used for activities

and programs to further the sobriety movement including education and treatment. The President of the Alaska Federation

of Natives shall submit a report on its activities and those

of its grantees including administrative costs and persons

served by December 31, 2001; and

(2) $15,000,000 shall be provided to the Indian Health

Service for drug and alcohol prevention and treatment services

for non-Alaska tribes.

CHAPTER 8

GENERAL PROVISIONS—THIS CHAPTER

SEC. 801. There are appropriated to the Health Resources and

Services Administration in the Department of Health and Human

Services, for the construction of the Biotechnology Science Center

at the Marshall University in Huntington, West Virginia,

$25,000,000, to remain available until expended.

SEC. 802. There are appropriated to the Health Resources and

Services Administration in the Department of Health and Human

Services, for the construction of the Christian Nurses Hospice in

Brentwood, New York, $400,000.

SEC. 803. There are appropriated to the Institute of Museum

and Library Services, for expansion of the marine biology program

at the Long Island Maritime Museum, $250,000.

114 STAT. 2763A–194 PUBLIC LAW 106–554—APPENDIX D

CHAPTER 9

LEGISLATIVE BRANCH

CONGRESSIONAL OPERATIONS

HOUSE OF REPRESENTATIVES

PAYMENTS TO WIDOWS AND HEIRS OF DECREASED MEMBERS OF

CONGRESS

For payment to Laura Y. Bateman, widow of Herbert H.

Bateman, late a Representative from the State of Virginia, $141,300.

For payment to Susan L. Vento, widow of Bruce F. Vento,

late a Representative from the State of Minnesota, $141,300.

For payment to Betty Lee Dixon, widow of Julian C. Dixon,

late a Representative from the State of California, $141,300.

ARCHITECT OF THE CAPITOL

CAPITOL BUILDINGS AND GROUNDS

CAPITOL BUILDINGS

SALARIES AND EXPENSES

For an additional amount for ‘‘CAPITOL BUILDINGS AND

GROUNDS—CAPITOL BUILDINGS—SALARIES AND EXPENSES’’ for necessary expenses for construction of emergency egress from the

fourth floor of the Capitol Building, $1,033,000, to remain available

until expended: Provided, That the entire amount is designated

by the Congress as an emergency requirement pursuant to section

251(b)(2)(A) of the Balanced Budget and Emergency Deficit Control

Act of 1985, as amended.

LIBRARY OF CONGRESS

SALARIES AND EXPENSES

For the Library of Congress, $25,000,000, to remain available

until expended, for necessary salaries and expenses of the National

Digital Information Infrastructure and Preservation Program; and

an additional $75,000,000, to remain available until expended, for

such purposes: Provided, That the portion of such additional

$75,000,000, which may be expended shall not exceed an amount

equal to the matching contributions (including contributions other

than money) for such purposes that: (1) are received by the Librarian of Congress for the program from non-Federal sources; and

(2) are received before March 31, 2003: Provided further, That

such program shall be carried out in accordance with a plan or

plans approved by the Committee on House Administration of the

House of Representatives, the Committee on Rules and Administration of the Senate, the Committee on Appropriations of the House

of Representatives, and the Committee on Appropriations of the

Senate: Provided further, That of the total amount appropriated,

$5,000,000 may be expended before the approval of a plan to develop

such a plan, and to collect or preserve essential digital information

which otherwise would be uncollectible: Provided further, That the

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–195

balance in excess of such $5,000,000 shall not be expended without

approval in advance by the Committee on Appropriations of the

House of Representatives and the Committee on Appropriations

of the Senate: Provided further, That the plan under this heading

shall be developed by the Librarian of Congress jointly with entities

of the Federal Government with expertise in telecommunications

technology and electronic commerce policy (including the Secretary

of Commerce and the Director of the White House Office of Science

and Technology Policy) and the National Archives and Records

Administration, and with the participation of representatives of

other Federal, research, and private libraries and institutions with

expertise in the collection and maintenance of archives of digital

materials (including the National Library of Medicine, the National

Agricultural Library, the National Institute of Standards and Technology, the Research Libraries Group, the Online Computer Library

Center, and the Council on Library and Information Resources)

and representatives of private business organizations which are

involved in efforts to preserve, collect, and disseminate information

in digital formats (including the Open e-Book Forum): Provided

further, That notwithstanding any other provision of law, effective

with the One Hundred Seventh Congress and each succeeding Congress the chair of the Subcommittee on the Legislative Branch

of the Committee on Appropriations of the House of Representatives

shall serve as a member of the Joint Committee on the Library

with respect to the Library’s financial management, organization,

budget development and implementation, and program development

and administration, as well as any other element of the mission

of the Library of Congress which is subject to the requirements

of Federal law.

GENERAL PROVISIONS—THIS CHAPTER

SEC. 901. RETIREMENT CREDIT FOR CERTAIN LEGISLATIVE

BRANCH EMPLOYEES. (a) FORMER EMPLOYEES OF CONGRESSIONAL

CAMPAIGN COMMITTEES.— (1) CSRS.—Section 8332(m) of title 5, United States Code,

as amended by section 312 of the Legislative Branch Appropriations Act, 2000, is amended—

(A) by redesignating paragraphs (2) and (3) as paragraphs (3) and (4), respectively; and

(B) by inserting after paragraph (1) the following new

paragraph:

‘‘(2) Upon application to the Office of Personnel Management,

any individual who was an employee on the date of enactment

of this paragraph, and who has on such date or thereafter acquires

5 years or more of creditable civilian service under this section

(exclusive of service for which credit is allowed under this subsection) shall be allowed credit (as service as a congressional

employee) for service before December 31, 1990, while employed

by the Democratic Senatorial Campaign Committee, the Republican

Senatorial Campaign Committee, the Democratic National Congressional Committee, or the Republican National Congressional

Committee, if—

‘‘(A) such employee has at least 4 years and 6 months

of service on such committees as of December 31, 1990; and

‘‘(B) such employee makes a deposit to the Fund in an

amount equal to the amount which would be required under

114 STAT. 2763A–196 PUBLIC LAW 106–554—APPENDIX D

section 8334(c) if such service were service as a congressional

employee.’’.

(2) FERS.—Section 8411 of title 5, United States Code,

is amended by adding at the end the following new subsection:

‘‘(i)(1) Upon application to the Office of Personnel Management,

any individual who was an employee on the date of enactment

of this paragraph, and who has on such date or thereafter acquired

5 years or more of creditable civilian service under this section

(exclusive of service for which credit is allowed under this subsection) shall be allowed credit (as service as a congressional

employee) for service before December 31, 1990, while employed

by the Democratic Senatorial Campaign Committee, the Republican

Senatorial Campaign Committee, the Democratic National Congressional Committee, or the Republican National Congressional

Committee, if—

‘‘(A) such employee has at least 4 years and 6 months

of service on such committees as of December 31, 1990; and

‘‘(B) such employee deposits to the Fund an amount equal

to 1.3 percent of the base pay for such service, with interest.

‘‘(2) The Office shall accept the certification of the President

of the Senate (or the President’s designee) or the Speaker of the

House of Representatives (or the Speaker’s designee), as the case

may be, concerning the service of, and the amount of compensation

received by, an employee with respect to whom credit is to be

sought under this subsection.

‘‘(3) An individual shall not be granted credit for such service

under this subsection if eligible for credit under section 8332(m)

for such service.’’.

(b) FORMER EMPLOYEES OF LEGISLATIVE SERVICE ORGANIZATIONS.—

(1) SERVICE OF EMPLOYEES OF LEGISLATIVE SERVICE

ORGANIZATIONS.—

(A) IN GENERAL.—Subject to succeeding provisions of

this paragraph, upon application to the Office of Personnel

Management in such form and manner as the Office shall

prescribe, any individual who performed service as an

employee of a legislative service organization of the House

of Representatives (as defined and authorized in the One

Hundred Third Congress) and whose pay was paid in whole

or in part by a source other than the Clerk Hire account

of a Member of the House of Representatives (other than

an individual described in paragraph (6)) shall be entitled—

(i) to receive credit under the provisions of subchapter III of chapter 83 or chapter 84 of title 5,

United States Code (whichever would be appropriate),

as congressional employee service, for all such service;

and

(ii) to have all pay for such service which was

so paid by a source other than the Clerk Hire account

of a Member included (in addition to any amounts

otherwise included in basic pay) for purposes of

computing an annuity payable out of the Civil Service

Retirement and Disability Fund.

(B) DEPOSIT REQUIREMENT.—In order to be eligible for

the benefits described in subparagraph (A), an individual

shall be required to pay into the Civil Service Retirement

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–197

and Disability Fund an amount equal to the difference

between—

(i) the employee contributions that were actually

made to such Fund under applicable provisions of law

with respect to the service described in subparagraph

(A); and

(ii) the employee contributions that would have

been required with respect to such service if the

amounts described in subparagraph (A)(ii) had also

been treated as basic pay.

The amount required under this subparagraph shall

include interest, which shall be computed under section

8334(e) of title 5, United States Code.

(C) CERTAIN OFFSETS REQUIRED IN ORDER TO PREVENT

DOUBLE CONTRIBUTIONS AND BENEFITS.—In the case of any

period of service as an employee of a legislative service

organization which constituted employment for purposes

of title II of the Social Security Act— (i) any pay for such service (as described in

subparagraph (A)(ii)) with respect to which the deposit

under subparagraph (B) would otherwise be computed

by applying the first sentence of section 8334(a)(1)

of title 5, United States Code, shall instead be computed in a manner based on section 8334(k) of such

title; and

(ii) any retirement benefits under subchapter III

of chapter 83 of title 5, United States Code, shall

be subject to offset (to reflect that portion of benefits

under title II of the Social Security Act attributable

to pay referred to in subparagraph (A)) similar to that

provided for under section 8349 of such title.

(2) SURVIVOR ANNUITANTS.—For purposes of survivor annuities, an application authorized by this section may, in the

case of an individual under paragraph (1) who has died, be

made by a survivor of such individual.

(3) RECOMPUTATION OF ANNUITIES.—Any annuity or survivor annuity payable as of when an individual makes the

deposit required under paragraph (1) shall be recomputed to

take into account the crediting of service under such paragraph

for purposes of amounts accruing for any period beginning

on or after the date on which the individual makes the deposit.

(4) CERTIFICATION OF SPEAKER.—The Office of Personnel

Management shall accept the certification of the Speaker of

the House of Representatives (or the Speaker’s designee)

concerning the service of, and the amount of compensation

received by, an employee with respect to whom credit is to

be sought under this subsection.

(5) NOTIFICATION AND OTHER DUTIES OF THE OFFICE OF

PERSONNEL MANAGEMENT.—

(A) NOTICE.—The Office of Personnel Management

shall take such action as may be necessary and appropriate

to inform individuals of any rights they might have as

a result of enactment of this subsection.

(B) ASSISTANCE.—The Office shall, on request, assist

any individual in obtaining from any department, agency,

or other instrumentality of the United States any information in the possession of such instrumentality which may

114 STAT. 2763A–198 PUBLIC LAW 106–554—APPENDIX D

be necessary to verify the entitlement of such individual

to have any service credited under this subsection or to

have an annuity recomputed under paragraph (3).

(C) INFORMATION.—Any department, agency, or other

instrumentality of the United States which possesses any

information with respect to an individual’s performance

of any service described in paragraph (1) shall, at the

request of the office, furnish such information to the Office.

(6) EXCLUSION OF CERTAIN EMPLOYEES.—An individual is

not eligible for credit under this subsection if the individual

served as an employee of the House of Representatives for

an aggregate period of 5 years or longer after the individual’s

final period of service as an employee of a legislative service

organization of the House of Representatives.

(7) MEMBER DEFINED.—In this subsection, the term ‘‘Member of the House of Representatives’’ includes a Delegate or

Resident Commissioner to Congress.

SEC. 902. (a) The Legislative Branch Appropriations Act, 2001

is amended under the subheading ‘‘MISCELLANEOUS ITEMS’’ under

the heading ‘‘SENATE’’ under title I by striking ‘‘$8,655,000’’ and

inserting ‘‘$25,155,000’’.

(b) The amendment made by subsection (a) shall take effect

as if included in the enactment of the Legislative Branch Appropriations Act, 2001.

SEC. 903. Beginning on the first day of the 107th Congress,

the Presiding Officer of the Senate shall apply all of the precedents

of the Senate under Rule XXVIII in effect at the conclusion of

the 103d Congress. Further that there is now in effect a Standing

order of the Senate that the reading of conference reports is no

longer required, if the said conference report is available in the

Senate.

CHAPTER 10

GENERAL PROVISIONS—THIS CHAPTER

SEC. 1001. In addition to amounts appropriated or otherwise

made available in the Military Construction Appropriations Act,

2001, $43,500,000 is hereby appropriated to the Department of

Defense, to remain available until September 30, 2005, as follows:

‘‘Military Construction, Army’’, $27,000,000;

‘‘Military Construction, Air Force’’, $12,000,000;

‘‘Military Construction, Army National Guard’’, $4,500,000:

Provided, That notwithstanding any other provision of law, such

funds may be obligated or expended to carry out planning and

design, military construction, and family housing projects not otherwise authorized by law.

SEC. 1002. TRANSFER OF JURISDICTION, MELROSE AIR FORCE

RANGE, NEW MEXICO. (a) TRANSFER REQUIRED.—(1) The Secretary

of the Interior shall transfer, without reimbursement, to the

administrative jurisdiction of the Secretary of the Air Force the

surface estate in the real property described in paragraph (2),

which consists of 6,713.90 acres of public domain lands in Roosevelt

County, New Mexico.

(2) The transfer of administrative jurisdiction under paragraph

(1) encompasses the following sections (or portions thereof):

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–199

(A) In Township 1 North, Range 30 East, New Mexico

Prime Meridian:

(i) Sec. 2 (S1⁄2).

(ii) Sec. 11. All.

(iii) Sec. 20 (S1⁄2SE1⁄4).

(iv) Sec. 28. All.

(B) In Township 1 South, Range 30 East, New Mexico

Prime Meridian:

(i) Sec. 2 (Lots 1–12, S1⁄2).

(ii) Sec. 3 (Lots 1–12, S1⁄2).

(iii) Sec. 4 (Lots 1–12, S1⁄2).

(iv) Sec. 6 (Lots 1 and 2).

(v) Sec. 9 (N1⁄2, N1⁄2S1⁄2).

(vi) Sec. 10 (N1⁄2, N1⁄2S1⁄2).

(vii) Sec. 11 (N1⁄2, N1⁄2S1⁄2).

(C) In Township 2 North, Range 30 East, New Mexico

Prime Meridian:

(i) Sec. 20 (E1⁄2S1⁄4).

(ii) Sec. 21 (SW1⁄4, W1⁄2SE1⁄4).

(iii) Sec. 28 (W1⁄2E1⁄2, W1⁄2).

(iv) Sec. 29 (E1⁄2E1⁄2).

(v) Sec. 32 (E1⁄2E1⁄2).

(vi) Sec. 33 (W1⁄2E1⁄2, NW1⁄4, S1⁄2SW1⁄4).

(b) STATUS OF SURFACE ESTATE.—Upon transfer under subsection (a), the surface estate is deemed to be real property subject

to the Federal Property and Administrative Services Act of 1949

(40 U.S.C. 471 et seq.).

(c) WITHDRAWAL OF MINERAL ESTATE.—Subject to valid existing

rights, the mineral estate of the lands described in subsection

(a) are withdrawn from all forms of appropriation under the public

land laws, including the mining laws and the mineral and geothermal leasing laws, but not the Act of July 31, 1947 (commonly

known as the Materials Act of 1947; 30 U.S.C. 601 et seq.).

(d) USE OF MINERAL MATERIALS.—Notwithstanding subsection

(c) or the Act of July 31, 1947, the Secretary of the Air Force

may use, without application to the Secretary of the Interior, the

sand, gravel, or similar mineral material resources on the lands

described in subsection (a), of the type subject to disposition under

the Act of July 31, 1947, when the use of such resources is required

for construction needs on the Melrose Air Force Range, New Mexico.

SEC. 1003. TRANSFER OF JURISDICTION, YAKIMA TRAINING CENTER, WASHINGTON. (a) TRANSFER REQUIRED.—(1) The Secretary of

the Interior shall transfer, without reimbursement, to the administrative jurisdiction of the Secretary of the Army the surface estate

in the real property described in paragraph (2), which consists

of 6,640.02 acres of public domain lands in Kittitas County,

Washington.

(2) The transfer of administrative jurisdiction under paragraph

(1) encompasses the following sections (or portions thereof):

(A) In Township 17 North, Range 20 East, Willamette

Meridian:

(i) Sec. 22 (S1⁄2).

(ii) Sec. 24 (S1⁄2SW1⁄4 and that portion of the E1⁄2

lying south of the Interstate Highway 90 right-of-way).

(iii) Sec. 26. All.

(B) In Township 16 North, Range 21 East, Willamette

Meridian:

114 STAT. 2763A–200 PUBLIC LAW 106–554—APPENDIX D

(i) Sec. 4 (SW1⁄4SW1⁄4).

(ii) Sec. 12 (SE1⁄4).

(iii) Sec. 18 (Lots 1, 2, 3, and 4, E1⁄2 and E1⁄2W1⁄2).

(C) In Township 17 North, Range 21 East, Willamette

Meridian:

(i) Sec. 30 (Lots 3 and 4).

(ii) Sec. 32 (NE1⁄4SE1⁄4).

(D) In Township 16 North, Range 22 East, Willamette

Meridian:

(i) Sec. 2 (Lots 1, 2, 3, and 4, S1⁄2N1⁄2 and S1⁄2).

(ii) Sec. 4 (Lots 1, 2, 3, and 4, S1⁄2N1⁄2 and S1⁄2).

(iii) Sec. 10. All.

(iv) Sec. 14. All.

(v) Sec. 20 (SE1⁄4SW1⁄4).

(vi) Sec. 22. All.

(vii) Sec. 26 (N1⁄2).

(viii) Sec. 28 (N1⁄2).

(E) In Township 16 North, Range 23 East, Willamette

Meridian:

(i) Sec. 18 (Lots 3 and 4, E1⁄2SW1⁄4, W1⁄2SE1⁄4, and

that portion of the E1⁄2SE1⁄4 lying westerly of the westerly

right-of-way line of Huntzinger Road).

(ii) Sec. 20 (That portion of the SW1⁄4 lying westerly

of the easterly right-of-way line of the railroad).

(iii) Sec. 30 (Lots 1 and 2, NE1⁄4 and E1⁄2NW1⁄4).

(b) STATUS OF SURFACE ESTATE.—Upon transfer under subsection (a), the surface estate is deemed to be real property subject

to the Federal Property and Administrative Services Act of 1949

(40 U.S.C. 471 et seq.).

(c) WITHDRAWAL OF MINERAL ESTATE.—(1) Subject to valid

existing rights, the mineral estate of the lands described in subsection (a), as well as the additional lands described in paragraph

(2), are withdrawn from all forms of appropriation under the public

land laws, including the mining laws and the geothermal leasing

laws, but not the Act of July 31, 1947 (commonly known as the

Materials Act of 1947; 30 U.S.C. 601, et seq.) and the Mineral

Leasing Act (30 U.S.C. 181 et seq.).

(2) The additional lands referred to in paragraph (1) consist

of 3,090.80 acres in the following sections (or portions thereof):

(A) In Township 16 North, Range 20 East, Willamette

Meridian:

(i) Sec. 12. All.

(ii) Sec. 18 (Lot 4 and SE1⁄4).

(iii) Sec. 20 (S1⁄2).

(B) In Township 16 North, Range 21 East, Willamette

Meridian:

(i) Sec. 4 (Lots 1, 2, 3, and 4, S1⁄2NE1⁄4).

(ii) Sec. 8. All.

(C) In Township 16 North, Range 22 East, Willamette

Meridian:

(i) Sec. 12. All.

(D) In Township 17 North, Range 21 East, Willamette

Meridian:

(i) Sec. 32 (S1⁄2SE1⁄4).

(ii) Sec. 34 (W1⁄2).

(d) USE OF MINERAL MATERIALS.—Notwithstanding subsection

(c) or the Act of July 31, 1947, the Secretary of the Army may

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–201

use, without application to the Secretary of the Interior, the sand,

gravel, or similar mineral material resources on the lands described

in subsections (a) and (c), of the type subject to disposition under

the Act of July 31, 1947, when the use of such resources is required

for construction needs on the Yakima Training Center, Washington.

CHAPTER 11

DEPARTMENT OF TRANSPORTATION

GENERAL PROVISIONS—THIS CHAPTER

SEC. 1101. Section 5309(g)(4)(D)(2) of title 49, United States

Code, is amended by striking ‘‘light’’. SEC. 1102. Item number 630 of the table contained in section

1602 of the Transportation Act for the 21st Century (112 Stat.

280), relating to Buffalo, New York, is amended by striking ‘‘Design

and construct Outer Harbor Bridge in Buffalo’’ and inserting ‘‘Transportation infrastructure improvements, Inner Harbor/

Redevelopment project, Buffalo’’. SEC. 1103. If the State of Arkansas incorporates into the relocation of U.S. Route 71 through Fort Chaffee, Arkansas, land obtained

by the State from the Federal Government as a result of the

closure of a military installation, the Secretary of Transportation

shall credit to the State share of the cost of the relocation the

fair market value of such land .

SEC. 1104. For an additional amount to enable the Secretary

of Transportation to make a grant to the Huntsville International

Airport, $2,500,000, to be derived from the airport and airway

trust fund, to remain available until expended.

SEC. 1105. Notwithstanding any other provision of law, for

necessary expenses for the Southeast Light Rail Extension Project

in Dallas, Texas, $1,000,000, to be derived from the Mass Transit

Account of the Highway Trust Fund and to remain available until

expended.

SEC. 1106. Section 1105(c) of the Intermodal Surface Transportation Efficiency Act of 1991 (105 Stat. 2032–2033) is amended

by striking paragraph (38) and replacing it with the following—

‘‘(38) The Ports-to-Plains Corridor from Laredo, Texas, via

I–27 to Denver, Colorado, shall include:

‘‘(A) In the State of Texas the Ports-to-Plains Corridor

shall generally follow—

‘‘(i) I–35 from Laredo to United States Route 83

at Exit 18;

‘‘(ii) United States Route 83 from Exit 18 to Carrizo

Springs;

‘‘(iii) United States Route 277 from Carrizo Springs

to San Angelo;

‘‘(iv) United States Route 87 from San Angelo to

Sterling City;

‘‘(v) From Sterling City to Lamesa, the Corridor

shall follow United States Route 87 and, the Corridor

shall also follow Texas Route 158 from Sterling City

to I–20, then via I–20 West to Texas Route 349 and,

Texas Route 349 from Midland to Lamesa;

‘‘(vi) United States Route 87 from Lamesa to Lubbock;

114 STAT. 2763A–202 PUBLIC LAW 106–554—APPENDIX D

‘‘(vii) I–27 from Lubbock to Amarillo; and

‘‘(viii) United States Route 287 from Amarillo to

Dumas.

‘‘(B) The corridor designation contained in paragraph

(A) shall take effect only if the Texas Transportation

Commission has not designated the Ports-to-Plains Corridor in Texas by June 30, 2001.’’.

SEC. 1107. For an additional amount to enable the Secretary

of Transportation to make a grant for the Newark-Elizabeth rail

link project, New Jersey, $3,000,000, to be derived from the Mass

Transit Account of the Highway Trust Fund and to remain available

until expended.

SEC. 1108. Section 5309(m)(3)(C) of title 49 United States Code,

shall not apply to the funds made available in the Department

of Transportation and Related Agencies Appropriations Act, 2001:

Provided, That notwithstanding any other provision of law, the

14th Street Bridge, Virginia; Chouteau Bridge, Jackson County,

Missouri; Clement C. Clay Bridge replacement, Morgan/Madison

counties, Alabama; Fairfield-Benton-Kennebec River Bridge, Maine;

Florida Memorial Bridge, Florida; Historic Woodrow Wilson Bridge,

Mississippi; Missisquoi Bay Bridge, Vermont; Oaklawn Bridge,

South Pasadena, California; Pearl Harbor Memorial Bridge replacement, Connecticut; Powell County Bridge, Montana; Santa Clara

Bridge, Oxnard, California; Star City Bridge, West Virginia; US

231 Bridge over Tennessee River, Alabama; US 54/US 69 Bridge,

Kansas; Waimalu Bridge replacement on I–1, Hawaii; Washington

Bridge, Rhode Island are eligible in fiscal year 2001 under section

144(g)(2) of title 23, United States Code: Provided further, That

section 378 of Public Law 106–346 is amended by inserting after

‘‘US 101’’ the following: ‘‘and Interstate 5 Trade Corridor’’.

SEC. 1109. Notwithstanding any other provision of law, in addition to funds otherwise appropriated in this or any other Act for

fiscal year 2001, $4,000,000 is hereby appropriated from the Highway Trust Fund for Commercial Remote Sensing Products and

Spatial Information Technologies under section 5113 of Public Law

105–178, as amended: Provided, That such funds are used to study

the creation of a new highway right-of-way south of I–10 along

the Mississippi Gulf Coast by relocating the existing railroad rightof-way out of downtown areas.

SEC. 1110. Amtrak is authorized to obtain services from the

Administrator of General Services, and the Administrator is authorized to provide services to Amtrak, under sections 201(b) and 211(b)

of the Federal Property and Administrative Services Act of 1949

(40 U.S.C. 481(b) and 491(b)) for fiscal year 2001 and each fiscal

year thereafter until the fiscal year that Amtrak operates without

Federal operating grant funds appropriated for its benefit, as

required by sections 24101(d) and 24104(a) of title 49, United States

Code.

SEC. 1111. Of the funds made available in the ‘‘Alteration

of bridges’’ account of the Department of Transportation and Related

Agencies Appropriations Act, 2001 for the Fox River Bridge,

$575,000 shall be transferred by the Secretary of Transportation

to the City of Oshkosh for removal of the bridge located at mile

point 56.9 of the Fox River in Oshkosh, Wisconsin. The United

States shall assume no responsibility for project management relating to removal of the bridge.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–203

SEC. 1112. Notwithstanding section 27 of the Merchant Marine

Act, 1920 (46 App. U.S.C. 883), section 8 of the Act of June 19,

1886 (46 App. U.S.C. 289), and section 12106 of title 46, United

States Code, the Secretary of Transportation may issue a certificate

of documentation with appropriate endorsement for employment

in the coastwise trade for the following vessels:

(1) M/V WELLS GRAY (State of Alaska registration number AK 9452 N; former Canadian registration number 154661);

and

(2) ANNANDALE (United States official number 519434).

SEC. 1113. CONVEYANCE OF COAST GUARD PROPERTY IN MIDDLETOWN, CALIFORNIA. (a) AUTHORITY TO CONVEY.—

(1) IN GENERAL.—The Administrator of General Services

(in this section referred to as the ‘‘Administrator’’) may

promptly convey to Lake County, California (in this section

referred to as the ‘‘County’’), without consideration, all right,

title, and interest of the United States (subject to subsection

(c)) in and to the property described in subsection (b).

(2) IDENTIFICATION OF PROPERTY.—The Administrator, in

consultation with the Commandant of the Coast Guard, may

identify, describe, and determine the property to be conveyed

under this section.

(b) PROPERTY DESCRIBED.—

(1) IN GENERAL.—The property referred to in subsection

(a) is such portion of the Coast Guard LORAN Station Middletown as has been reported to the General Services Administration to be excess property, consisting of approximately 733.43

acres, and is comprised of all or part of tracts A–101, A–

102, A–104, A–105, A–106, A–107, A–108, and A–111.

(2) SURVEY.—The exact acreage and legal description of

the property conveyed under subsection (a), and any easements

or rights-of-way reserved by the United States under subsection

(c)(1), shall be determined by a survey satisfactory to the

Administrator. The cost of the survey shall be borne by the

County.

(c) CONDITIONS.—

(1) IN GENERAL.—In making the conveyance under subsection (a), the Administrator shall—

(A) reserve for the United States such existing rightsof-way for access and such easements as are necessary

for continued operation of the LORAN station;

(B) preserve other existing easements for public roads

and highways, public utilities, irrigation ditches, railroads,

and pipelines; and

(C) impose such other restrictions on use of the property conveyed as are necessary to protect the safety, security, and continued operation of the LORAN station.

(2) FIREBREAKS AND FENCE.—(A) The Administrator may

not convey any property under this section unless the County

and the Commandant of the Coast Guard enter into an agreement with the Administrator under which the County is

required, in accordance with design specifications and maintenance standards established by the Commandant—

(i) to establish and construct within 6 months after

the date of the conveyance, and thereafter to maintain,

firebreaks on the property to be conveyed; and

114 STAT. 2763A–204 PUBLIC LAW 106–554—APPENDIX D

(ii) construct within 6 months after the date of conveyance, and thereafter maintain, a fence approved by the

Commandant along the property line between the property

conveyed and adjoining Coast Guard property.

(B) The agreement shall require that—

(i) the County shall pay all costs of establishment,

construction, and maintenance of firebreaks under subparagraph (A)(i); and

(ii) the Commandant shall provide all materials needed

to construct a fence under subparagraph (A)(ii), and the

County shall pay all other costs of construction and maintenance of the fence.

(3) COVENANTS APPURTENANT.—The Administrator shall

take actions necessary to render the requirement to establish,

construct, and maintain firebreaks and a fence under paragraph

(2) and other requirements and conditions under paragraph

(1), under the deed conveying the property to the County,

covenants that run with the land for the benefit of land retained

by the United States.

(d) REVERSIONARY INTEREST.—During the 5-year period beginning on the date the Administrator makes the conveyance authorized by subsection (a), the real property conveyed pursuant to

this section, at the option of the Administrator, shall revert to

the United States and be placed under the administrative control

of the Administrator, if—

(1) the County sells, conveys, assigns, exchanges, or encumbers the property conveyed or any part thereof;

(2) the County fails to maintain the property conveyed

in a manner consistent with the terms and conditions in subsection (c);

(3) the County conducts any commercial activities at the

property conveyed, or any part thereof, without approval of

the Secretary; or

(4) at least 30 days before the reversion, the Administrator

provides written notice to the owner that the property or any

part thereof is needed for national security purposes.

SEC. 1114. CONVEYANCE OF COAST GUARD PROPERTY TO TOWN

OF NANTUCKET, MASSACHUSETTS. (a) AUTHORITY TO CONVEY.—

(1) IN GENERAL.—Notwithstanding any other law, the

Administrator of the General Services Administration (Administrator) or the Commandant of the Coast Guard (Commandant),

as appropriate, shall convey to the Town of Nantucket,

Massachusetts (Town), without monetary consideration, all

right, title, and interest of the United States of America (United

States) in and to a certain parcel of land located in Nantucket,

Massachusetts, and part of the United States Coast Guard

LORAN Station Nantucket, together with any improvements

thereon in their then current condition.

(2) IDENTIFICATION OF PROPERTY.—The Administrator or

the Commandant, as appropriate, shall identify, describe, and

determine the property to be conveyed under this section. The

Town shall bear all monetary costs associated with any survey

required to describe the property to be conveyed under this

section and any easements reserved by the United States under

subsection (b)(1).

(b) TERMS AND CONDITIONS OF CONVEYANCE.—

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–205

(1) The conveyance of property under this section shall

be made subject to any terms and conditions the Administrator

or the Commandant, as appropriate, considers necessary,

including the reservation of easements and other rights on

behalf of the United States, to ensure that—

(A) there is reserved to the United States the right

to remove, relocate, or replace any aid to navigation located

upon, or install or construct any aid to navigation upon,

property conveyed under this section as may be necessary

for navigational purposes;

(B) the United States shall have the right to enter

property conveyed under this section at any time, without

notice, for purposes of operating, maintaining, and inspecting any aid to navigation and for the purposes of exercising

any of the rights set forth in paragraph (1)(A) of this

subsection; and

(C) the Town shall not interfere or allow interference,

in any manner, with any aid to navigation, whether located

upon the property conveyed under this section or upon

any portion of LORAN Station Nantucket retained by the

United States, nor hinder activities required for the inspection, operation, and maintenance of any such aid to navigation without the Commandant’s express written permission.

(2) The Town shall not convey, assign, exchange, or in

any way encumber the property conveyed under this section,

unless approved by the Administrator.

(3) The Town shall not conduct any commercial activities

at or upon the property conveyed under this section, unless

approved by the Administrator.

(4) The Town shall not be required to maintain any active

aid to navigation associated with the property conveyed under

this section except for private aids to navigation permitted

under 14 U.S.C. 83.

(5) The United States shall not convey any property under

this section, nor grant any real property license under subsection (d), until the Town enters into an agreement with

the United States to relocate the Coast Guard receiving antenna

and associated equipment, as identified by the Commandant,

at the Town’s sole cost and expense, and subject to the Commandant’s design specifications, project schedule, and final

project approval.

(6) The United States shall not convey any property under

this section, nor grant any real property license under subsection (d), until the Town enters into an agreement with

the United States that provides that the Town will immediately

cease construction or operation of the waste water treatment

facility upon notification by the Commandant that the Town’s

construction or operation of the facility interferes with any

Coast Guard aid to navigation. The agreement shall provide

that construction or operation shall not be resumed until the

conditions causing the interference are corrected, and the Commandant authorizes the construction or operation to resume.

(7) All conditions placed with the deed of title shall be

construed as covenants running with the land.

(c) REVERSIONARY INTEREST.—In addition to any term or condition established pursuant to this section, the conveyance of property

114 STAT. 2763A–206 PUBLIC LAW 106–554—APPENDIX D

under this section shall include a condition that the property conveyed, at the option of the Administrator, shall revert to the United

States and be placed under the administrative control of the

Administrator, if—

(1) the Town conveys, assigns, exchanges, or in any manner

encumbers the property conveyed for consideration, unless

otherwise approved by the Administrator;

(2) the Town conducts any commercial activities at or upon

the property conveyed, unless otherwise approved by the

Administrator;

(3) the Town interferes or allows interference, in any manner, with any aid to navigation, whether located upon the

property conveyed under this section or upon any portion of

LORAN Station Nantucket retained by the United States, nor

hinder activities required for the inspection, operation, and

maintenance of any such aid to navigation without the Commandant’s express written permission; or

(4) at least 30 days before the reversion, the Administrator

provides written notice to the grantee that property conveyed

under this section, or any portion thereof, is needed for national

security purposes.

(d) REAL PROPERTY LICENSE.—Prior to the conveyance of any

property under this section, the Commandant may grant a real

property license to the Town for the purpose of allowing the Town

to enter upon LORAN Station Nantucket and commence construction of a waste water treatment facility and for other site preparation activities.

(e) DEFINITIONS.—For purposes of this section:

(1) AID TO NAVIGATION.—The term ‘‘aid to navigation’’

means equipment used for navigation purposes, including but

not limited to, a light, antenna, sound signal, electronic and

radio navigation equipment and signals, cameras, sensors, or

other equipment operated or maintained by the United States.

(2) TOWN.—The term ‘‘Town’’ includes the successors and

assigns of the Town of Nantucket, Massachusetts.

SEC. 1115. CONVEYANCE OF PLUM ISLAND LIGHTHOUSE,

NEWBURYPORT, MASSACHUSETTS. (a) AUTHORITY TO CONVEY.—

(1) IN GENERAL.—Notwithstanding any other law, the

Administrator of the General Services Administration (Administrator) or the Commandant of the Coast Guard (Commandant),

as appropriate, shall convey to the City of Newburyport,

Massachusetts (City), without monetary consideration, all right,

title, and interest of the United States of America (United

States) in and to two certain parcels of land upon which the

Plum Island Boat House and the Plum Island Lighthouse (also

known as the Newburyport Harbor Light), are situated, respectively, located in Essex County, Massachusetts, together with

any improvements thereon in their then current condition.

(2) IDENTIFICATION OF PROPERTY.—The Administrator or

the Commandant, as appropriate, shall identify, describe, and

determine the property to be conveyed under this section,

including the right to retain all right, title, and interest of

the United States to any portion of either parcel described

in paragraph (a)(1) of this section. The Administrator or Commandant, as appropriate, may retain all right, title, and interest

of the United States in and to any historical artifact, including

any lens or lantern, that is associated with and located at

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–207

the property conveyed under this section at the time of conveyance. Artifacts associated with, but not located at, the property

conveyed under this section at the time of conveyance, shall

remain the personal property of the United States under the

administrative control of the Commandant. No submerged lands

shall be conveyed under this section.

(b) TERMS AND CONDITIONS OF CONVEYANCE.—

(1) The conveyance of property under this section shall

be made subject to any terms and conditions the Administrator

or the Commandant, as appropriate, considers necessary,

including but not limited to, the reservation of easements and

other rights on behalf of the United States, to ensure that—

(A) the aids to navigation located at property conveyed

under this section shall remain the personal property of

the United States and continue to be operated and maintained by the United States for as long as needed for

navigational purposes;

(B) there is reserved to the United States the right

to remove, relocate, or replace any aid to navigation located

upon, or install or construct any aid to navigation upon,

property conveyed under this section as may be necessary

for navigational purposes;

(C) the United States shall have the right to enter

property conveyed under this section at any time, without

notice, for purposes of operating, maintaining, and inspecting any aid to navigation, for the purposes of exercising

any of the rights set forth in paragraph (1)(B) of this

subsection, and for the purposes of ingress and egress

to any land retained by the United States; and

(D) the City shall not, without the Commandant’s

express written permission, interfere or allow interference,

in any manner, with any aid to navigation, nor hinder

activities required

(i) for the inspection, operation, and maintenance

of any aid to navigation; or

(ii) for the exercise of any of the rights set forth

in paragraph (1)(B) of this subsection.

(2) The City shall, at its own cost and expense, maintain

the property conveyed under this section in a proper, substantial, and workmanlike manner.

(3) The City shall ensure that the property conveyed is

available and accessible to the public, on a reasonable basis

for educational, park, recreational, cultural, historic preservation or similar purposes.

(4) The City shall not be required to maintain any active

aid to navigation associated with the property conveyed under

this section except for private aids to navigation permitted

under 14 U.S.C. 83.

(5) All conditions placed with the deed of title for property

conveyed under this section shall be construed as covenants

running with the land.

(6) The Administrator or the Commandant, as appropriate,

may require such additional terms and conditions with respect

to the conveyance of property under this section, as the

Administrator or the Commandant considers appropriate to

protect the interests of the United States.

114 STAT. 2763A–208 PUBLIC LAW 106–554—APPENDIX D

(c) REVERSIONARY INTEREST.—In addition to any term or condition established pursuant to this section, any property conveyed

under this section, at the option of the Administrator, shall revert

to the United States and be placed under the administrative control

of the Administrator, if—

(1) the property conveyed under this section, or any part

thereof, ceases to be maintained in a manner that ensures

its present or future use as a site for an aid to navigation

as determined by the Commandant;

(2) the property conveyed under this section, or any part

thereof, ceases to be available and accessible to the public,

on a reasonable basis, for educational, park, recreational, cultural, historic preservation or similar purposes; or

(3) at least 30 days before the reversion, the Administrator

provides written notice to the grantee that property conveyed

under this section, or any portion thereof, is needed for national

security purposes.

(d) DEFINITIONS.—For purposes of this section:

(1) AID TO NAVIGATION.—The term ‘‘aid to navigation’’

means equipment used for navigation purposes, including but

not limited to, a light, antenna, sound signal, electronic and

radio navigation equipment and signals, cameras, sensors, or

other equipment operated or maintained by the United States.

(2) CITY.—The term ‘‘City’’ includes the successors and

assigns of the City of Newburyport, Massachusetts.

SEC. 1116. TRANSFER OF COAST GUARD STATION SCITUATE TO

THE NATIONAL OCEANIC AND ATMOSPHERIC ADMINISTRATION. (a)

AUTHORITY TO TRANSFER.—

(1) IN GENERAL.—The Administrator of the General Services Administration, in consultation with the Commandant,

United States Coast Guard, may transfer without consideration

administrative jurisdiction, custody, and control over the Federal property known as Coast Guard Station Scituate to the

National Oceanic and Atmospheric Administration (hereinafter

referred to as ‘‘NOAA’’).

(2) IDENTIFICATION OF PROPERTY.—The Administrator, in

consultation with the Commandant, may identify, describe, and

determine the property to be transferred under this section.

(b) TERMS OF TRANSFER.—

(1) The transfer of the property shall be made subject

to any conditions and reservations the Commandant considers

necessary to ensure that—

(A) the transfer of the property to NOAA is contingent

upon the relocation of Coast Guard Station Scituate to

a suitable site;

(B) there is reserved to the Coast Guard the right

to remove, relocate, or replace any aid to navigation located

upon, or install any aid to navigation upon, the property

transferred under this section as may be necessary for

navigational purposes; and

(C) the Coast Guard shall have the right to enter

the property transferred under this section at any time,

without notice, for purposes of operating, maintaining, and

inspecting any aid to navigation.

(2) The transfer of the property shall be made subject

to the review and acceptance of the property by NOAA.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–209

(c) RELOCATION OF STATION SCITUATE.—The Coast Guard

may— (1) lease land, including unimproved or vacant land, for

a term not to exceed 20 years, for the purpose of relocating

Coast Guard Station Scituate; and

(2) improve the land leased under this subsection.

SEC. 1117. EXTENSION OF INTERIM AUTHORITY FOR DRY BULK

CARGO RESIDUE DISPOSAL. (a) Section 415(b)(2) of the Coast Guard

Authorization Act of 1998 is amended by striking ‘‘2002’’ and inserting ‘‘2004’’. (b) The Secretary shall conduct a study of the effectiveness

of the United States 1997 Enforcement Policy for Cargo Residues

on the Great Lakes (‘‘Policy’’) by September 30, 2002.

(c) The Secretary is authorized to promulgate regulations to

implement and enforce a program to regulate incidental discharges

from vessels of residues of non-hazardous and non-toxic dry bulk

cargo into the waters of the Great Lakes, which takes into account

the finding in the study required under subsection (b). This program

shall be consistent with the Policy.

SEC. 1118. GREAT LAKES PILOTAGE ADVISORY COMMITTEE. Section 9307 of title 46, United States Code, is amended—

(1) by amending subparagraph (A) of subsection (b)(2) to

read as follows:

‘‘(A) The President of each of the 3 Great Lakes pilotage

districts, or the President’s representative;’’;

(2) by amending subparagraph (E) of subsection (b)(2) to

read as follows:

‘‘(E) a member with a background in finance or accounting, who—

‘‘(i) must have been recommended to the Secretary

by a unanimous vote of the other members of the

Committee, and

‘‘(ii) may be appointed without regard to requirement in paragraph (1) that each member have 5 years

of practical experience in maritime operations.’’;

(3) in subsection (C)(2) by striking the second sentence;

(4) by adding at the end of subsection (d) the following

new paragraph:

‘‘(3) Any recommendations to the Secretary under subsection (a)(2) must have been approved by at least all but

one of the members then serving on the committee.’’; and

(5) in subsection (f )(1) by striking ‘‘September 30, 2003’’

and inserting ‘‘September 30, 2005’’.

SEC. 1119. VESSEL ESCORT OPERATIONS AND TOWING ASSISTANCE. (a) IN GENERAL.—Except in the case of a vessel in distress,

only a vessel of the United States (as that term is defined in

section 2101 of title 46, United States Code) may perform the

following vessel escort operations and vessel towing assistance

within the navigable waters of the United States:

(1) Operations or assistance that commences or terminates

at a port or place in the United States.

(2) Operations or assistance required by United States

law or regulation.

(3) Operations provided in whole or in part for the purpose

of escorting or assisting a vessel within or through navigation

facilities owned, maintained, or operated by the United States

Government or the approaches to such facilities, other than

114 STAT. 2763A–210 PUBLIC LAW 106–554—APPENDIX D

facilities operated by the St. Lawrence Seaway Development

Corporation on the St. Lawrence River portion of the Seaway.

(b) DEFINITIONS.—Unless otherwise defined by a provision of

law or regulation requiring that towing assistance or escort be

rendered to vessels transiting United States waters or navigation

facilities, for purposes of this section—

(1) the term ‘‘towing assistance’’ means operations by an

assisting vessel in direct contact with an assisted vessel (including hull-to-hull, by towline, including if only pre-tethered, or

made fast to that vessel by one or more lines) for purposes

of exerting force on the assisted vessel to control or to assist

in controlling the movement of the assisted vessel; and

(2) the term ‘‘escort operations’’ means accompanying a

vessel for the purpose of providing towing or towing assistance

to the vessel.

SEC. 1120. Notwithstanding any other provision of law, the

Commandant of the United States Coast Guard is hereby authorized

to utilize $100,000 of the amounts made available for fiscal year

2001 for environmental compliance and restoration of Coast Guard

facilities to reimburse the owner of the former Coast Guard lighthouse facility at Cape May, New Jersey, for costs incurred for

clean-up of lead contaminated soil at that facility.

SEC. 1121. Notwithstanding any other provision of law,

$2,400,000, to be derived from the Highway Trust Fund, shall

be available for planning, development and construction of rural

farm-to-market roads in Tulare County, California: Provided, That

the non-Federal share of such improvements shall be 20 percent.

SEC. 1122. Notwithstanding any other provision of law, and

subject to the availability of funds appropriated specifically for

the project, the Coast Guard is authorized to transfer funds in

an amount not to exceed $200,000 and project management authority to the Traverse City Area Public School District for the purposes

of demolition and removal of the structure commonly known as

‘‘Building 402’’ at former Coast Guard property located in Traverse

City, Michigan, and associated site work. No such funds shall

be transferred until the Coast Guard receives a detailed, fixed

price estimate from the School District describing the nature and

cost of the work to be performed, and the Coast Guard shall transfer

only that amount of funds it and the School District consider

necessary to complete the project.

SEC. 1123. Notwithstanding any other provision of law, for

necessary expenses for Alabama A&M University buses and bus

facilities, $500,000, to be derived from the Mass Transit Account

of the Highway Trust Fund and to remain available until expended.

SEC. 1124. Notwithstanding any other provision of law, prior

to the fiscal year 2002 apportionment of ‘‘Fixed Guideway Modernization’’ funds authorized under section 5309(a)(1)(E) of title

49, United States Code, $7,047,502 of funds made available in

fiscal year 2002 by section 5338(b) of title 49, United States Code,

for the ‘‘Fixed Guideway Modernization’’ program shall be distributed by the Federal Transit Administration to an urbanized area

over 200,000 that did not receive amounts of fixed guideway modernization formula grants to which such area was lawfully entitled

for fiscal years 1999–2001 in view of eligibility determinations

made under chapter 53 of title 49, United States Code, during

the 6 months prior to the effective date of this Act: Provided,

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–211

That such sums shall not reduce a grantee’s fiscal year 2002 apportionment level of ‘‘Fixed Guideway Modernization’’ funds: Provided

further, That such sum remain available until expended.

SEC. 1125. Notwithstanding any other provision of law, Airport

Improvement Program Formula Changes provided in Public Law

106–181 and defined in section 104 of that Act shall be applied

regardless of funding levels made available under section 48103

of title 49, United States Code.

SEC. 1126. Item number 473 contained in section 1602 of the

Transportation Equity Act for the 21st Century (112 Stat. 274),

relating to Minnesota, is amended by striking ‘‘between I–35W

and 24th Avenue to four lanes in Richfield’’ and inserting

‘‘reconstruction project from Penn Avenue to 24th Avenue, including

the Penn Avenue Bridge over I–494’’. SEC. 1127. The Secretary of Transportation shall not issue

final regulations under section 20153 of title 49, United States

Code, before July 1, 2001.

SEC. 1128. Notwithstanding any other provision of law, in addition to amounts made available in this Act or any other Act,

the following sums shall be made available from the Highway

Trust Fund (other than the Mass Transit Account):

$1,700,000 for transportation and community preservation

projects along the Main Street Corridor in Houston, Texas;

$5,000,000 for rehabilitation, repair, and restoration of the

historic Stillwater Lift Bridge between Stillwater, Minnesota

and Houlton, Wisconsin;

$1,000,000 for improvements to McClung Road, Boston

Street, Larson Street and Whirlpool Drive in the City of

LaPorte, Indiana; and

$1,000,000 for design, environmental mitigation, engineering, and construction of, and improvements to, the US 36/

Wadsworth interchange (Broomfield interchange) in Broomfield

County, Colorado:

Provided, That the amounts appropriated in this section shall

remain available until expended and shall not be subject to, or

computed against, any obligation limitation or contract authority

set forth in this or any other Act.

CHAPTER 12

GENERAL SERVICES ADMINISTRATION

REAL PROPERTY ACTIVITIES

FEDERAL BUILDINGS FUND

For an additional amount to be deposited in, and to be used

for the purposes of, the Federal Buildings Fund of the General

Services Administration, $2,070,000: Provided, That this amount

shall be available for the purpose of renovating and redeveloping

portions of the historic Federal building located at 30 North Seventh

Street in Terre Haute, Indiana, to accommodate the needs of Federal tenants: Provided further, That use of these funds is subject

to authorization including the preparation and approval of a

prospectus as required by the Public Buildings Act of 1959, as

amended.

114 STAT. 2763A–212 PUBLIC LAW 106–554—APPENDIX D

DEPARTMENT OF THE TREASURY

UNITED STATES CUSTOMS SERVICE

OPERATIONS, MAINTENANCE AND PROCUREMENT, AIR AND MARINE

INTERDICTION PROGRAMS

For an additional amount of $7,000,000, to remain available

until expended, for necessary expenses associated with procurement

of two aircraft and related equipment expenses associated with

aviation standardization and training at the Customs National

Aviation Center in Oklahoma City, Oklahoma: Provided, That none

of the funds provided shall be available for obligation until an

expenditure plan is submitted for approval to the Committees on

Appropriations.

CHAPTER 13

DEPARTMENT OF VETERANS AFFAIRS

DEPARTMENTAL ADMINISTRATION

CONSTRUCTION, MINOR PROJECTS

For an additional amount for ‘‘Construction, minor projects’’,

$8,840,000, to remain available until expended.

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

COMMUNITY PLANNING AND DEVELOPMENT

EMPOWERMENT ZONES/ENTERPRISE COMMUNITIES

For an additional amount for ‘‘Empowerment zones and enterprise communities’’, $110,000,000, to remain available until

expended: Provided, That $185,000,000 shall be available for urban

empowerment zones, as authorized by the Taxpayer Relief Act

of 1997, including $12,333,333 for each empowerment zone.

COMMUNITY DEVELOPMENT FUND

For an additional amount for ‘‘Community development fund’’,

$66,128,000 to remain available until September 30, 2003.

The referenced statement of the managers in the seventh

undesignated paragraph under this heading in title II of the Departments of Veterans Affairs and Housing and Urban Development,

and Independent Agencies Appropriations Act, 2001 (Public Law

106–377) is deemed to be amended by striking ‘‘West Dallas

neighborhoods’’ in reference to improvement efforts by the Pleasant

Wood/Pleasant Grove Community Development Corporation, and

inserting ‘‘the Pleasant Grove area’’ in lieu thereof.

The unobligated amount appropriated in the third paragraph

under the heading ‘‘Community development block grants’’ in chapter 8 of title II of the Emergency Supplemental Act, 2000 (Public

Law 106–246) for a grant to the City of Hamlet, North Carolina,

for demolition and removal of buildings and equipment destroyed

by fire shall remain available until September 30, 2002, for a

grant for such purpose to the County of Richmond, North Carolina.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–213

The seventh paragraph under this heading in title II of Public

Law 106–377 is amended by striking ‘‘$292,000,000’’ and inserting

in lieu thereof ‘‘$358,128,000’’: Provided, That such funds shall

be available for grants for the Economic Development Initiative

(EDI) to finance a variety of targeted economic investments in

accordance with the terms and conditions specified in the statement

of managers accompanying this conference report.

DEPARTMENT OF THE TREASURY

COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS

COMMUNITY DEVELOPMENT FINANCIAL INSTITUTIONS

FUND PROGRAM ACCOUNT

Under this heading in Public Law 106–377, strike ‘‘$8,750,000

may be used for administrative expenses,’’ and insert ‘‘$9,750,000

may be used for administrative expenses, including administration

of the New Markets Tax Credit and Individual Development

Accounts,’’.

ENVIRONMENTAL PROTECTION AGENCY

SCIENCE AND TECHNOLOGY

For an additional amount for ‘‘Science and technology’’,

$1,000,000 for continuation of the South Bronx Air Pollution Study

being conducted by New York University.

ENVIRONMENTAL PROGRAMS AND MANAGEMENT

The statement of the managers under this heading in title

III of the Departments of Veterans Affairs and Housing and Urban

Development, and Independent Agencies Appropriations Act, 2001

(Public Law 106–377) is deemed to be amended by inserting the

word ‘‘Valley’’ after the words ‘‘San Bernardino’’ in reference to

a project identified as number 104 in such statement of the managers.

STATE AND TRIBAL ASSISTANCE GRANTS

Grants appropriated under this heading in Public Law 106–

74 and Public Law 106–377 for drinking water infrastructure needs

in the New York City watershed shall be awarded under section

1443(d) of the Safe Drinking Water Act, as amended.

The referenced statement of the managers under this heading

in Public Law 106–377 is deemed to be amended by striking all

after the words ‘‘City of Liberty’’ in reference to item number

78, and inserting the words ‘‘Town of Versailles, Indiana for wastewater infrastructure improvements’’.

Under this heading in title III of Public Law 106–377, strike

‘‘$335,740,000’’ and insert ‘‘$356,370,000’’: Provided, That such

funds shall be for making grants for the construction of wastewater

and water treatment facilities and groundwater protection infrastructure in accordance with the terms and conditions specified

for such grants in the statement of managers accompanying Public

Law 106–377 and this conference report.

114 STAT. 2763A–214 PUBLIC LAW 106–554—APPENDIX D

FEDERAL EMERGENCY MANAGEMENT AGENCY

EMERGENCY MANAGEMENT PLANNING AND ASSISTANCE

For an additional amount for ‘‘Emergency management planning and assistance’’, $100,000,000, to remain available through

September 30, 2001, for programs as authorized by section 33

of the Federal Fire Prevention and Control Act of 1974 (15 U.S.C.

2201 et seq.), as amended.

CHAPTER 14

GENERAL PROVISIONS—THIS DIVISION

SEC. 1401. H. Con. Res. 234 of the 106th Congress, as adopted

by the House of Representatives on November 18, 1999, shall be

considered to have been adopted by the Senate.

SEC. 1402. Section 3003(a)(1) of the Federal Reports Elimination and Sunset Act of 1995 (31 U.S.C. 1113 note) does not

apply to any report required to be submitted under any of the

following provisions of law:

(1) Sections 1105(a), 1106(a) and (b), and 1109(a) of title

31, United States Code, and any other law relating to the

budget of the United States Government.

(2) The Balanced Budget and Emergency Deficit Control

Act of 1985 (2 U.S.C. 900 et seq.).

(3) Sections 202(e)(1) and (3) of the Congressional Budget

Act of 1974 (2 U.S.C. 602(e)(1) and (3)).

(4) Section 1014(e) of the Congressional Budget and

Impoundment Control Act of 1974 (2 U.S.C. 685(e)).

SEC. 1403. (a) GOVERNMENT-WIDE RESCISSIONS.—There is

hereby rescinded an amount equal to 0.22 percent of the discretionary budget authority provided (or obligation limit imposed) for

fiscal year 2001 in this or any other Act for each department,

agency, instrumentality, or entity of the Federal Government,

except for those programs, projects, and activities which are specifically exempted elsewhere in this provision: Provided, That this

exact reduction percentage shall be applied on a pro rata basis

only to each program, project, and activity subject to the rescission.

(b) RESTRICTIONS.—This reduction shall not be applied to the

amounts appropriated in title I of Public Law 106–259: Provided, That this reduction shall not be applied to the amounts appropriated

in division B of Public Law 106–246: Provided further, That this

reduction shall not be applied to the amounts appropriated under

the Departments of Labor, Health and Human Services, and Education, and Related Agencies Appropriations Act, 2001, as contained

in this Act, or in prior Acts.

(c) REPORT.—The Director of the Office of Management and

Budget shall include in the President’s budget submitted for fiscal

year 2002 a report specifying the reductions made to each account

pursuant to this section.

DIVISION B

TITLE I

SEC. 101. ELIGIBILITY OF PRIVATE ORGANIZATIONS UNDER CHILD

AND ADULT CARE FOOD PROGRAM. (a) Section 17(a)(2)(B) of the

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–215

Richard B. Russell National School Lunch Act (42 U.S.C.

1766(a)(2)(B)) is amended by striking ‘‘children for which the’’ and

inserting ‘‘children, if—

‘‘(i) during the period beginning on the date of

enactment of this clause and ending on September

30, 2001, at least 25 percent of the children served

by the organization meet the income eligibility criteria

established under section 9(b) for free or reduced price

meals; or

‘‘(ii) the’’.

(b) EMERGENCY REQUIREMENT.—

(1) IN GENERAL.—The entire amount necessary to carry

out this section shall be available only to the extent that

an official budget request for the entire amount, that includes

designation of the entire amount of the request as an emergency

requirement as defined in the Balanced Budget and Emergency

Deficit Control Act of 1985, as amended, is transmitted by

the President to the Congress.

(2) DESIGNATION.—The entire amount necessary to carry

out this section is designated by the Congress as an emergency

requirement pursuant to section 251(b)(2)(A) of such Act.

SEC. 102. SUMMER FOOD PILOT PROJECTS. (a) Section 18 of

the Richard B. Russell National School Lunch Act (42 U.S.C. 1769)

is amended by adding at the end the following:

‘‘(f ) SUMMER FOOD PILOT PROJECTS.—

‘‘(1) DEFINITION OF ELIGIBLE STATE.—In this subsection,

the term ‘eligible State’ means a State in which (based on

data available in July 2000)—

‘‘(A) the percentage obtained by dividing—

‘‘(i) the sum of—

‘‘(I) the average daily number of children

attending the summer food service program in the

State in July 1999; and

‘‘(II) the average daily number of children

receiving free or reduced price meals under the

school lunch program in the State in July 1999;

by

‘‘(ii) the average daily number of children receiving

free or reduced price meals under the school lunch

program in the State in March 1999; is less than

50 percent of

‘‘(B) the percentage obtained by dividing—

‘‘(i) the sum of—

‘‘(I) the average daily number of children

attending the summer food service program in all

States in July 1999; and

‘‘(II) the average daily number of children

receiving free or reduced price meals under the

school lunch program in all States in July 1999;

by

‘‘(ii) the average daily number of children receiving

free or reduced price meals under the school lunch

program in all States in March 1999.

‘‘(2) PILOT PROJECTS.—During the period of fiscal years

2001 through 2003, the Secretary shall carry out a summer

food pilot project in each eligible State to increase the number

114 STAT. 2763A–216 PUBLIC LAW 106–554—APPENDIX D

of children participating in the summer food service program

in the State. ‘‘(3) SUPPORT LEVELS FOR SERVICE INSTITUTIONS.—

‘‘(A) FOOD SERVICE.—Under the pilot project, a service

institution (other than a service institution described in

section 13(a)(7)) in an eligible State shall receive the maximum amounts for food service under section 13(b)(1) without regard to the requirement under section 13(b)(1)(A)

that payments shall equal the full cost of food service

operations. ‘‘(B) ADMINISTRATIVE COSTS.—Under the pilot project,

a service institution (other than a service institution

described in section 13(a)(7)) in an eligible State shall

receive the maximum amounts for administrative costs

determined by the Secretary under section 13(b)(4) without

regard to the requirement under section 13(b)(3) that payments to service institutions shall equal the full amount

of State-approved administrative costs incurred. ‘‘(C) COMPLIANCE.—A service institution that receives

assistance under this subsection shall comply with all

provisions of section 13 other than subsections (b)(1)(A)

and (b)(3) of section 13.

‘‘(4) MAINTENANCE OF EFFORT.—Expenditures of funds from

State and local sources for maintenance of a summer food

service program shall not be diminished as a result of assistance

from the Secretary received under this subsection.

‘‘(5) EVALUATION OF PILOT PROJECTS.—

‘‘(A) IN GENERAL.—The Secretary, acting through the

Administrator of the Food and Nutrition Service, shall

conduct an evaluation of the pilot project.

‘‘(B) CONTENT.—An evaluation under this paragraph

shall describe—

‘‘(i) any effect on participation by children and

service institutions in the summer food service program

in the eligible State in which the pilot project is carried

out;

‘‘(ii) any effect of the pilot project on the quality

of the meals and supplements served in the eligible

State in which the pilot project is carried out; and

‘‘(iii) any effect of the pilot project on program

integrity.

‘‘(6) REPORTS.—

‘‘(A) INTERIM REPORT.—Not later than December 1,

2002, the Secretary shall submit to the Committee on Education and the Workforce of the House of Representatives

and the Committee on Agriculture, Nutrition, and Forestry

of the Senate an interim report that describes the status

of, and any progress made by, each pilot project being

carried out under this subsection as of the date of submission of the report.

‘‘(B) FINAL REPORT.—Not later than April 30, 2004,

the Secretary shall submit to the Committee on Education

and the Workforce of the House of Representatives and

the Committee on Agriculture, Nutrition, and Forestry of

the Senate a final report that includes—

‘‘(i) the evaluations completed by the Secretary

under paragraph (5); and

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–217

‘‘(ii) any recommendations of the Secretary

concerning the pilot projects.’’. (b) EMERGENCY REQUIREMENT.—

(1) IN GENERAL.—The entire amount necessary to carry

out this section shall be available only to the extent that

an official budget request for the entire amount, that includes

designation of the entire amount of the request as an emergency

requirement as defined in the Balanced Budget and Emergency

Deficit Control Act of 1985, as amended, is transmitted by

the President to the Congress.

(2) DESIGNATION.—The entire amount necessary to carry

out this section is designated by the Congress as an emergency

requirement pursuant to section 251(b)(2)(A) of such Act.

SEC. 103. (a) IN GENERAL.—The Secretary of the Interior shall

conduct a feasibility study for a Sacramento River, California, diversion project that is consistent with the Water Forum Agreement

among the members of the Sacramento, California, Water Forum

dated April 24, 2000, and that considers— (1) consolidation of several of the Natomas Central Mutual

Water Company’s diversions;

(2) upgrading fish screens at the consolidated diversion;

(3) the diversion of 35,000 acre feet of water by the Placer

County Water Agency;

(4) the diversion of 29,000 acre feet of water for delivery

to the Northridge Water District;

(5) the potential to accommodate other diversions of water

from the Sacramento River, subject to additional negotiations

and agreement among Water Forum signatories and potentially

affected parties upstream on the Sacramento River; and

(6) an inter-tie between the diversions referred to in paragraphs (3), (4), and (5) with the Northridge Water District’s

pipeline that delivers water from the American River.

(b) REQUIRED COMPONENTS.—The feasibility study shall

include—

(1) the development of a range of reasonable options;

(2) an environmental evaluation; and

(3) consultation with Federal and State resource management agencies regarding potential impacts and mitigation

measures.

(c) WATER SUPPLY IMPACT ALTERNATIVES.—The study authorized by this section shall include a range of alternatives, all of

which would investigate options that could reduce to insignificance

any water supply impact on water users in the Sacramento River

watershed, including Central Valley Project contractors, from any

delivery of water out of the Sacramento River as referenced in

subsection (a). In evaluating the alternatives, the study shall consider water supply alternatives that would increase water supply

for, or in, the Sacramento River watershed. The study should be

coordinated with the CALFED program and take advantage of

information already developed within that program to investigate

water supply increase alternatives. Where the alternatives evaluated are in addition to or different from the existing CALFED

alternatives, such information should be clearly identified.

(d) HABITAT MANAGEMENT PLANNING GRANTS.—The Secretary

of the Interior, subject to the availability of appropriations, is

authorized and directed to provide grants to support local habitat

management planning efforts undertaken as part of the consultation

114 STAT. 2763A–218 PUBLIC LAW 106–554—APPENDIX D

described in subsection (b)(3) in the form of matching funds up

to $5,000,000.

(e) REPORT.—The Secretary of the Interior shall provide a report

to the Committee on Resources of the United States House of

Representatives and to the Committee on Energy and Natural

Resources of the United States Senate within 24 months from

the date of enactment of this Act on the results of the study

identified in subsection (a).

(f ) AUTHORIZATION OF APPROPRIATIONS.—There is authorized

to be appropriated to the Secretary of the Interior to carry out

this section $10,000,000, which may remain available until

expended, of which—

(1) $5,000,000 shall be for the feasibility study under subsection (a); and

(2) $5,000,000 shall be for the habitat management planning grants under subsection (d).

(g) LIMITATION ON CONSTRUCTION.—This section does not and

shall not be interpreted to authorize construction of any facilities.

SEC. 104. TEN- AND FIFTEEN-MILE BAYOUS, ARKANSAS. The

project for flood control, Saint Francis River Basin, Missouri and

Arkansas, authorized by section 204 of the Flood Control Act of

1950 (64 Stat. 172), is modified to expand the boundaries of the

project to include Ten- and Fifteen-Mile Bayous near West Memphis, Arkansas. Notwithstanding section 103(f ) of the Water

Resources Development Act of 1986 (100 Stat. 4086), the flood

control work at Ten- and Fifteen-Mile Bayous shall not be considered separable elements of the project.

SEC. 105. In accordance with section 102(l) of the Water

Resources Development Act of 1990 (104 Stat. 4613), the Secretary

of the Army, acting through the Chief of Engineers, is authorized

and directed to enter into an agreement to permit the City of

Alton, Illinois to construct the authorized recreational facilities

and to reimburse the City of Alton, Illinois for the Federal share

of these cost-shared recreation facilities as usable segments are

completed.

SEC. 106. TRUCKEE WATERSHED RECLAMATION PROJECT. (a)

AUTHORIZATION.—The Secretary of the Interior, in cooperation with

Washoe County, Nevada, may participate in the design, planning,

and construction of the Truckee watershed reclamation project,

consisting of the North Valley reuse project and the Spanish Springs

Valley septic conversion project, to reclaim and reuse wastewater

(including degraded groundwater) within and without the service

area of Washoe County, Nevada.

(b) COST SHARE.—The Federal share of the cost of the project

described in subsection (a) shall not exceed 25 percent of the total

cost of the project.

(c) LIMITATION.—Funds provided by the Secretary shall not

be used for the operation or maintenance of the project described

in subsection (a).

(d) RECLAMATION WASTEWATER AND GROUNDWATER STUDY AND

FACILITIES ACT.—

(1) DESIGN, PLANNING, AND CONSTRUCTION.—Design, planning, and construction of the project described in subsection

(a) shall be in accordance with, and subject to the limitations

contained in, the Reclamation Wastewater and Groundwater

Study and Facilities Act (43 U.S.C. 390h et seq.).

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–219

(2) FUNDING.—Funds made available under section 1631

of the Reclamation Wastewater and Groundwater Study and

Facilities Act (43 U.S.C. 390h–13) may be used to pay the

Federal share of the cost of the project.

SEC. 107. The project for navigation, Tampa Harbor, Florida,

authorized by section 4 of the Rivers and Harbors Act of September

22, 1922 (42 Stat. 1042), is modified to authorize the Secretary

of the Army to deepen and widen the Alafia Channel in accordance

with the plans described in the Draft Feasibility Report, Alafia

River, Tampa Harbor, Florida, dated May 2000, at a total cost

of $61,592,000, with an estimated Federal cost of $39,621,000 and

an estimated non-Federal cost of $21,971,000.

SEC. 108. ENVIRONMENTAL INFRASTRUCTURE. (a) TECHNICAL, PLANNING, AND DESIGN ASSISTANCE.—Section 219(c) of the Water

Resources Development Act of 1992 (106 Stat. 4835) is amended

by adding at the end the following: ‘‘(19) MARANA, ARIZONA.—Wastewater treatment and distribution infrastructure, Marana, Arizona.

‘‘(20) EASTERN ARKANSAS ENTERPRISE COMMUNITY,

ARKANSAS.—Water-related infrastructure, Eastern Arkansas

Enterprise Community, Cross, Lee, Monroe, and St. Francis

Counties, Arkansas.

‘‘(21) CHINO HILLS, CALIFORNIA.—Storm water and sewage

collection infrastructure, Chino Hills, California.

‘‘(22) CLEAR LAKE BASIN, CALIFORNIA.—Water-related infrastructure and resource protection, Clear Lake Basin, California.

‘‘(23) DESERT HOT SPRINGS, CALIFORNIA.—Resource protection and wastewater infrastructure, Desert Hot Springs,

California.

‘‘(24) EASTERN MUNICIPAL WATER DISTRICT, CALIFORNIA.—

Regional water-related infrastructure, Eastern Municipal Water

District, California.

‘‘(25) HUNTINGTON BEACH, CALIFORNIA.—Water supply and

wastewater infrastructure, Huntington Beach, California.

‘‘(26) INGLEWOOD, CALIFORNIA.—Water infrastructure,

Inglewood, California.

‘‘(27) LOS OSOS COMMUNITY SERVICE DISTRICT, CALIFORNIA.—Wastewater infrastructure, Los Osos Community Service

District, California.

‘‘(28) NORWALK, CALIFORNIA.—Water-related infrastructure,

Norwalk, California.

‘‘(29) KEY BISCAYNE, FLORIDA.—Sanitary sewer infrastructure, Key Biscayne, Florida.

‘‘(30) SOUTH TAMPA, FLORIDA.—Water supply and aquifer

storage and recovery infrastructure, South Tampa, Florida.

‘‘(31) FORT WAYNE, INDIANA.—Combined sewer overflow

infrastructure and wetlands protection, Fort Wayne, Indiana.

‘‘(32) INDIANAPOLIS, INDIANA.—Combined sewer overflow

infrastructure, Indianapolis, Indiana.

‘‘(33) ST. CHARLES, ST. BERNARD, AND PLAQUEMINES PARISHES, LOUISIANA.—Water and wastewater infrastructure, St.

Charles, St. Bernard, and Plaquemines Parishes, Louisiana.

‘‘(34) ST. JOHN THE BAPTIST AND ST. JAMES PARISHES, LOUISIANA.—Water and sewer improvements, St. John the Baptist

and St. James Parishes, Louisiana.

‘‘(35) UNION COUNTY, NORTH CAROLINA.—Water infrastructure, Union County, North Carolina.

114 STAT. 2763A–220 PUBLIC LAW 106–554—APPENDIX D

‘‘(36) HOOD RIVER, OREGON.—Water transmission infrastructure, Hood River, Oregon. ‘‘(37) MEDFORD, OREGON.—Sewer collection infrastructure,

Medford, Oregon. ‘‘(38) PORTLAND, OREGON.—Water infrastructure and

resource protection, Portland, Oregon. ‘‘(39) COUDERSPORT, PENNSYLVANIA.—Sewer system extensions and improvements, Coudersport, Pennsylvania. ‘‘(40) PARK CITY, UTAH.—Water supply infrastructure, Park

City, Utah.’’. (b) AUTHORIZATION OF APPROPRIATIONS FOR TECHNICAL, PLAN- NING, AND DESIGN ASSISTANCE.—Section 219(d) of the Water

Resources Development Act of 1992 (106 Stat. 4836) is amended

by striking ‘‘$5,000,000’’ and inserting ‘‘$30,000,000’’. (c) MODIFICATION OF AUTHORIZATIONS FOR ENVIRONMENTAL

PROJECTS.—Section 219 of the Water Resources Development Act

of 1992 (106 Stat. 4835; 106 Stat. 3757; 113 Stat. 334) is amended— (1) in subsection (e)(6) by striking ‘‘$20,000,000’’ and inserting ‘‘$30,000,000’’;

(2) in subsection (f )(4) by striking ‘‘$15,000,000’’ and inserting ‘‘$35,000,000’’;

(3) in subsection (f )(21) by striking ‘‘$10,000,000’’ and

inserting ‘‘$20,000,000’’;

(4) in subsection (f )(25) by striking ‘‘$5,000,000’’ and inserting ‘‘$15,000,000’’;

(5) in subsection (f )(30) by striking ‘‘$10,000,000’’ and

inserting ‘‘$20,000,000’’;

(6) in subsection (f )(43) by striking ‘‘$15,000,000’’ and

inserting ‘‘$35,000,000’’.

(d) ADDITIONAL ASSISTANCE FOR CRITICAL RESOURCE

PROJECTS.—Section 219(f ) of the Water Resources Development

Act of 1992 (106 Stat. 4835; 113 Stat. 335) is amended by adding

at the end the following:

‘‘(45) WASHINGTON, D.C., AND MARYLAND.—$15,000,000 for

the project described in subsection (c)(1), modified to include

measures to eliminate or control combined sewer overflows

in the Anacostia River watershed.

‘‘(46) DUCK RIVER, CULLMAN, ALABAMA.—$5,000,000 for

water supply infrastructure, Duck River, Cullman, Alabama.

‘‘(47) UNION COUNTY, ARKANSAS.—$52,000,000 for water

supply infrastructure, including facilities for withdrawal, treatment, and distribution, Union County, Arkansas.

‘‘(48) CAMBRIA, CALIFORNIA.—$10,300,000 for desalination

infrastructure, Cambria, California.

‘‘(49) LOS ANGELES HARBOR/TERMINAL ISLAND, CALIFORNIA.—$6,500,000 for wastewater recycling infrastructure, Los

Angeles Harbor/Terminal Island, California.

‘‘(50) NORTH VALLEY REGION, LANCASTER, CALIFORNIA.—

$14,500,000 for water infrastructure, North Valley Region, Lancaster, California.

‘‘(51) SAN DIEGO COUNTY, CALIFORNIA.—$10,000,000 for

water-related infrastructure, San Diego County, California.

‘‘(52) SOUTH PERRIS, CALIFORNIA.—$25,000,000 for water

supply desalination infrastructure, South Perris, California.

‘‘(53) AURORA, ILLINOIS.—$8,000,000 for wastewater infrastructure to reduce or eliminate combined sewer overflows,

Aurora, Illinois.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–221

‘‘(54) COOK COUNTY, ILLINOIS.—$35,000,000 for waterrelated infrastructure and resource protection and development,

Cook County, Illinois. ‘‘(55) MADISON AND ST. CLAIR COUNTIES, ILLINOIS.— $10,000,000 for water and wastewater assistance, Madison and

St. Clair Counties, Illinois. ‘‘(56) IBERIA PARISH, LOUISIANA.—$5,000,000 for water and

wastewater infrastructure, Iberia Parish, Louisiana. ‘‘(57) KENNER, LOUISIANA.—$5,000,000 for wastewater

infrastructure, Kenner, Louisiana. ‘‘(58) BENTON HARBOR, MICHIGAN.—$1,500,000 for waterrelated infrastructure, City of Benton Harbor, Michigan. ‘‘(59) GENESEE COUNTY, MICHIGAN.—$6,700,000 for wastewater infrastructure assistance to reduce or eliminate sewer

overflows, Genesee County, Michigan. ‘‘(60) NEGAUNEE, MICHIGAN.—$10,000,000 for wastewater

infrastructure assistance, City of Negaunee, Michigan. ‘‘(61) GARRISON AND KATHIO TOWNSHIP, MINNESOTA.—

$11,000,000 for a wastewater infrastructure project for the

city of Garrison and Kathio Township, Minnesota.

‘‘(62) NEWTON, NEW JERSEY.—$7,000,000 for water filtration

infrastructure, Newton, New Jersey.

‘‘(63) LIVERPOOL, NEW YORK.—$2,000,000 for water infrastructure, including a pump station, Liverpool, New York.

‘‘(64) STANLY COUNTY, NORTH CAROLINA.—$8,900,000 for

wastewater infrastructure, Stanly County, North Carolina.

‘‘(65) YUKON, OKLAHOMA.—$5,500,000 for water-related

infrastructure, including wells, booster stations, storage tanks,

and transmission lines, Yukon, Oklahoma.

‘‘(66) ALLEGHENY COUNTY, PENNSYLVANIA.—$20,000,000 for

water-related environmental infrastructure, Allegheny County,

Pennsylvania.

‘‘(67) MOUNT JOY TOWNSHIP AND CONEWAGO TOWNSHIP,

PENNSYLVANIA.—$8,300,000 for water and wastewater infrastructure, Mount Joy Township and Conewago Township,

Pennsylvania.

‘‘(68) PHOENIXVILLE BOROUGH, CHESTER COUNTY, PENNSYLVANIA.—$2,400,000 for water and sewer infrastructure,

Phoenixville Borough, Chester County, Pennsylvania.

‘‘(69) TITUSVILLE, PENNSYLVANIA.—$7,300,000 for storm

water separation and treatment plant upgrades, Titusville,

Pennsylvania.

‘‘(70) WASHINGTON, GREENE, WESTMORELAND, AND FAYETTE

COUNTIES, PENNSYLVANIA.—$8,000,000 for water and wastewater infrastructure, Washington, Greene, Westmoreland, and

Fayette Counties, Pennsylvania.’’.

SEC. 109. FLORIDA KEYS WATER QUALITY IMPROVEMENTS. (a)

IN GENERAL.—In coordination with the Florida Keys Aqueduct

Authority, appropriate agencies of municipalities of Monroe County,

Florida, and other appropriate public agencies of the State of Florida

or Monroe County, the Secretary of the Army may provide technical

and financial assistance to carry out projects for the planning,

design, and construction of treatment works to improve water quality in the Florida Keys National Marine Sanctuary.

(b) CRITERIA FOR PROJECTS.—Before entering into a cooperation

agreement to provide assistance with respect to a project under

this section, the Secretary shall ensure that—

114 STAT. 2763A–222 PUBLIC LAW 106–554—APPENDIX D

(1) the non-Federal sponsor has completed adequate planning and design activities, as applicable;

(2) the non-Federal sponsor has completed a financial plan

identifying sources of non-Federal funding for the project;

(3) the project complies with—

(A) applicable growth management ordinances of Monroe County, Florida;

(B) applicable agreements between Monroe County,

Florida, and the State of Florida to manage growth in

Monroe County, Florida; and

(C) applicable water quality standards; and

(4) the project is consistent with the master wastewater

and storm water plans for Monroe County, Florida.

(c) CONSIDERATION.—In selecting projects under subsection (a),

the Secretary shall consider whether a project will have substantial

water quality benefits relative to other projects under consideration.

(d) CONSULTATION.—In carrying out this section, the Secretary

shall consult with—

(1) the Water Quality Steering Committee established

under section 8(d)(2)(A) of the Florida Keys National Marine

Sanctuary and Protection Act (106 Stat. 5054);

(2) the South Florida Ecosystem Restoration Task Force

established by section 528(f ) of the Water Resources Development Act of 1996 (110 Stat. 3771–3773);

(3) the Commission on the Everglades established by executive order of the Governor of the State of Florida; and

(4) other appropriate State and local government officials.

(e) NON-FEDERAL SHARE.—

(1) IN GENERAL.—The non-Federal share of the cost of

a project carried out under this section shall be 35 percent.

(2) CREDIT.—

(A) IN GENERAL.—The Secretary may provide the nonFederal interest credit toward cash contributions

required—

(i) before and during the construction of the

project, for the costs of planning, engineering, and

design, and for the construction management work

that is performed by the non-Federal interest and that

the Secretary determines is necessary to implement

the project; and

(ii) during the construction of the project, for the

construction that the non-Federal interest carries out

on behalf of the Secretary and that the Secretary determines is necessary to carry out the project.

(B) TREATMENT OF CREDIT BETWEEN PROJECTS.—Any

credit provided under this paragraph may be carried over

between authorized projects.

(f ) AUTHORIZATION OF APPROPRIATIONS.—There is authorized

to be appropriated to carry out this section $100,000,000. Such

sums shall remain available until expended.

SEC. 110. SAN GABRIEL BASIN, CALIFORNIA. (a) SAN GABRIEL

BASIN RESTORATION.—

(1) ESTABLISHMENT OF FUND.—There shall be established

within the Treasury of the United States an interest bearing

account to be known as the San Gabriel Basin Restoration

Fund (in this section referred to as the ‘‘Restoration Fund’’).

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–223

(2) ADMINISTRATION OF FUND.—The Restoration Fund shall

be administered by the Secretary of the Army, in cooperation

with the San Gabriel Basin Water Quality Authority or its

successor agency.

(3) PURPOSES OF FUND.— (A) IN GENERAL.—Subject to subparagraph (B), the

amounts in the Restoration Fund, including interest

accrued, shall be utilized by the Secretary— (i) to design and construct water quality projects

to be administered by the San Gabriel Basin Water

Quality Authority and the Central Basin Water Quality

Project to be administered by the Central Basin

Municipal Water District; and

(ii) to operate and maintain any project constructed

under this section for such period as the Secretary

determines, but not to exceed 10 years, following the

initial date of operation of the project.

(B) COST-SHARING LIMITATION.—

(i) IN GENERAL.—The Secretary may not obligate

any funds appropriated to the Restoration Fund in

a fiscal year until the Secretary has deposited in the

Fund an amount provided by non-Federal interests

sufficient to ensure that at least 35 percent of any

funds obligated by the Secretary are from funds provided to the Secretary by the non-Federal interests.

(ii) NON-FEDERAL RESPONSIBILITY.—The San

Gabriel Basin Water Quality Authority shall be responsible for providing the non-Federal amount required

by clause (i). The State of California, local government

agencies, and private entities may provide all or any

portion of such amount.

(b) COMPLIANCE WITH APPLICABLE LAW.—In carrying out the

activities described in this section, the Secretary shall comply with

any applicable Federal and State laws.

(c) RELATIONSHIP TO OTHER ACTIVITIES.—Nothing in this section shall be construed to affect other Federal or State authorities

that are being used or may be used to facilitate the cleanup and

protection of the San Gabriel and Central groundwater basins.

In carrying out the activities described in this section, the Secretary

shall integrate such activities with ongoing Federal and State

projects and activities. None of the funds made available for such

activities pursuant to this section shall be counted against any

Federal authorization ceiling established for any previously authorized Federal projects or activities.

(d) AUTHORIZATION OF APPROPRIATIONS.—

(1) IN GENERAL.—There is authorized to be appropriated

to the Restoration Fund established under subsection (a)

$85,000,000. Such funds shall remain available until expended.

(2) SET-ASIDE.—Of the amounts appropriated under paragraph (1), no more than $10,000,000 shall be available to carry

out the Central Basin Water Quality Project.

(e) ADJUSTMENT.—Of the $25,000,000 made available for San

Gabriel Basin Groundwater Restoration, California, under the heading ‘‘Construction, General’’ in title I of the Energy and Water

Development Appropriations Act, 2001—

(1) $2,000,000 shall be available only for studies and other

investigative activities and planning and design of projects

114 STAT. 2763A–224 PUBLIC LAW 106–554—APPENDIX D

determined by the Secretary to offer a long-term solution to

the problem of groundwater contamination caused by perchlorates at sites located in the city of Santa Clarita, California;

and

(2) $23,000,000 shall be deposited in the Restoration Fund,

of which $4,000,000 shall be used for remediation in the Central

Basin, California.

SEC. 111. PERCHLORATE. (a) IN GENERAL.—The Secretary of

the Army, in cooperation with Federal, State, and local government

agencies, may participate in studies and other investigative activities and in the planning and design of projects determined by

the Secretary to offer a long-term solution to the problem of groundwater contamination caused by perchlorates.

(b) INVESTIGATIONS AND PROJECTS.— (1) BOSQUE AND LEON RIVERS.—The Secretary, in coordination with other Federal agencies and the Brazos River Authority, shall participate under subsection (a) in investigations and

projects in the Bosque and Leon Rivers watersheds in Texas

to assess the impact of the perchlorate associated with the

former Naval ‘‘Weapons Industrial Reserve Plant’’ at McGregor,

Texas.

(2) CADDO LAKE.—The Secretary, in coordination with other

Federal agencies and the Northeast Texas Municipal Water

District, shall participate under subsection (a) in investigations

and projects relating to perchlorate contamination in Caddo

Lake, Texas.

(3) EASTERN SANTA CLARA BASIN.—The Secretary, in

coordination with other Federal, State, and local government

agencies, shall participate under subsection (a) in investigations

and projects related to sites that are sources of perchlorates

and that are located in the city of Santa Clarita, California.

(c) AUTHORIZATION OF APPROPRIATIONS.—For the purposes of

carrying out this section, there is authorized to be appropriated

to the Secretary $25,000,000, of which not to exceed $8,000,000

shall be available to carry out subsection (b)(1), not to exceed

$3,000,000 shall be available to carry out subsection (b)(2), and

not to exceed $7,000,000 shall be available to carry out subsection

(b)(3).

SEC. 112. WET WEATHER WATER QUALITY. (a) COMBINED SEWER

OVERFLOWS.—Section 402 of the Federal Water Pollution Control

Act (33 U.S.C. 1342) is amended by adding at the end the following:

‘‘(q) COMBINED SEWER OVERFLOWS.—

‘‘(1) REQUIREMENT FOR PERMITS, ORDERS, AND DECREES.—

Each permit, order, or decree issued pursuant to this Act after

the date of enactment of this subsection for a discharge from

a municipal combined storm and sanitary sewer shall conform

to the Combined Sewer Overflow Control Policy signed by the

Administrator on April 11, 1994 (in this subsection referred

to as the ‘CSO control policy’).

‘‘(2) WATER QUALITY AND DESIGNATED USE REVIEW GUIDANCE.—Not later than July 31, 2001, and after providing notice

and opportunity for public comment, the Administrator shall

issue guidance to facilitate the conduct of water quality and

designated use reviews for municipal combined sewer overflow

receiving waters.

‘‘(3) REPORT.—Not later than September 1, 2001, the

Administrator shall transmit to Congress a report on the

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–225

progress made by the Environmental Protection Agency, States,

and municipalities in implementing and enforcing the CSO

control policy.’’. (b) WET WEATHER PILOT PROGRAM.—Title I of the Federal

Water Pollution Control Act (33 U.S.C. 1251 et seq.) is amended

by adding at the end the following:

‘‘SEC. 121. WET WEATHER WATERSHED PILOT PROJECTS.

‘‘(a) IN GENERAL.—The Administrator, in coordination with the

States, may provide technical assistance and grants for treatment

works to carry out pilot projects relating to the following areas

of wet weather discharge control: ‘‘(1) WATERSHED MANAGEMENT OF WET WEATHER DIS- CHARGES.—The management of municipal combined sewer overflows, sanitary sewer overflows, and stormwater discharges,

on an integrated watershed or subwatershed basis for the purpose of demonstrating the effectiveness of a unified wet weather

approach. ‘‘(2) STORMWATER BEST MANAGEMENT PRACTICES.—The control of pollutants from municipal separate storm sewer systems

for the purpose of demonstrating and determining controls that

are cost-effective and that use innovative technologies in reducing such pollutants from stormwater discharges.

‘‘(b) ADMINISTRATION.—The Administrator, in coordination with

the States, shall provide municipalities participating in a pilot

project under this section the ability to engage in innovative practices, including the ability to unify separate wet weather control

efforts under a single permit. ‘‘(c) FUNDING.— ‘‘(1) IN GENERAL.—There is authorized to be appropriated to carry out this section $10,000,000 for fiscal year 2002,

$15,000,000 for fiscal year 2003, and $20,000,000 for fiscal

year 2004. Such funds shall remain available until expended. ‘‘(2) STORMWATER.—The Administrator shall make available not less than 20 percent of amounts appropriated for

a fiscal year pursuant to this subsection to carry out the purposes of subsection (a)(2). ‘‘(3) ADMINISTRATIVE EXPENSES.—The Administrator may

retain not to exceed 4 percent of any amounts appropriated

for a fiscal year pursuant to this subsection for the reasonable

and necessary costs of administering this section.

‘‘(d) REPORT TO CONGRESS.—Not later than 5 years after the

date of enactment of this section, the Administrator shall transmit

to Congress a report on the results of the pilot projects conducted

under this section and their possible application nationwide.’’. (c) SEWER OVERFLOW CONTROL GRANTS.—Title II of the Federal

Water Pollution Control Act (33 U.S.C. 1342 et seq.) is amended

by adding at the end the following:

‘‘SEC. 221. SEWER OVERFLOW CONTROL GRANTS.

‘‘(a) IN GENERAL.—In any fiscal year in which the Administrator

has available for obligation at least $1,350,000,000 for the purposes

of section 601—

‘‘(1) the Administrator may make grants to States for the

purpose of providing grants to a municipality or municipal

entity for planning, design, and construction of treatment works

to intercept, transport, control, or treat municipal combined

sewer overflows and sanitary sewer overflows; and

114 STAT. 2763A–226 PUBLIC LAW 106–554—APPENDIX D

‘‘(2) subject to subsection (g), the Administrator may make

a direct grant to a municipality or municipal entity for the

purposes described in paragraph (1).

‘‘(b) PRIORITIZATION.—In selecting from among municipalities

applying for grants under subsection (a), a State or the Administrator shall give priority to an applicant that—

‘‘(1) is a municipality that is a financially distressed

community under subsection (c);

‘‘(2) has implemented or is complying with an implementation schedule for the nine minimum controls specified in the

CSO control policy referred to in section 402(q)(1) and has

begun implementing a long-term municipal combined sewer

overflow control plan or a separate sanitary sewer overflow

control plan;

‘‘(3) is requesting a grant for a project that is on a State’s

intended use plan pursuant to section 606(c); or

‘‘(4) is an Alaska Native Village.

‘‘(c) FINANCIALLY DISTRESSED COMMUNITY.—

‘‘(1) DEFINITION.—In subsection (b), the term ‘financially

distressed community’ means a community that meets affordability criteria established by the State in which the community

is located, if such criteria are developed after public review

and comment.

‘‘(2) CONSIDERATION OF IMPACT ON WATER AND SEWER

RATES.—In determining if a community is a distressed community for the purposes of subsection (b), the State shall consider,

among other factors, the extent to which the rate of growth

of a community’s tax base has been historically slow such

that implementing a plan described in subsection (b)(2) would

result in a significant increase in any water or sewer rate

charged by the community’s publicly owned wastewater treatment facility.

‘‘(3) INFORMATION TO ASSIST STATES.—The Administrator

may publish information to assist States in establishing affordability criteria under paragraph (1).

‘‘(d) COST-SHARING.—The Federal share of the cost of activities

carried out using amounts from a grant made under subsection

(a) shall be not less than 55 percent of the cost. The non-Federal

share of the cost may include, in any amount, public and private

funds and in-kind services, and may include, notwithstanding section 603(h), financial assistance, including loans, from a State water

pollution control revolving fund.

‘‘(e) ADMINISTRATIVE REPORTING REQUIREMENTS.—If a project

receives grant assistance under subsection (a) and loan assistance

from a State water pollution control revolving fund and the loan

assistance is for 15 percent or more of the cost of the project,

the project may be administered in accordance with State water

pollution control revolving fund administrative reporting requirements for the purposes of streamlining such requirements.

‘‘(f ) AUTHORIZATION OF APPROPRIATIONS.—There is authorized

to be appropriated to carry out this section $750,000,000 for each

of fiscal years 2002 and 2003. Such sums shall remain available

until expended.

‘‘(g) ALLOCATION OF FUNDS.—

‘‘(1) FISCAL YEAR 2002.—Subject to subsection (h), the

Administrator shall use the amounts appropriated to carry

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–227

out this section for fiscal year 2002 for making grants to municipalities and municipal entities under subsection (a)(2), in

accordance with the criteria set forth in subsection (b).

‘‘(2) FISCAL YEAR 2003.—Subject to subsection (h), the

Administrator shall use the amounts appropriated to carry

out this section for fiscal year 2003 as follows:

‘‘(A) Not to exceed $250,000,000 for making grants

to municipalities and municipal entities under subsection

(a)(2), in accordance with the criteria set forth in subsection

(b).

‘‘(B) All remaining amounts for making grants to States

under subsection (a)(1), in accordance with a formula to

be established by the Administrator, after providing notice

and an opportunity for public comment, that allocates to

each State a proportional share of such amounts based

on the total needs of the State for municipal combined

sewer overflow controls and sanitary sewer overflow controls identified in the most recent survey conducted pursuant to section 516(b)(1).

‘‘(h) ADMINISTRATIVE EXPENSES.—Of the amounts appropriated

to carry out this section for each fiscal year—

‘‘(1) the Administrator may retain an amount not to exceed

1 percent for the reasonable and necessary costs of administering this section; and

‘‘(2) the Administrator, or a State, may retain an amount

not to exceed 4 percent of any grant made to a municipality

or municipal entity under subsection (a), for the reasonable

and necessary costs of administering the grant.

‘‘(i) REPORTS.—Not later than December 31, 2003, and periodically thereafter, the Administrator shall transmit to Congress a

report containing recommended funding levels for grants under

this section. The recommended funding levels shall be sufficient

to ensure the continued expeditious implementation of municipal

combined sewer overflow and sanitary sewer overflow controls

nationwide.’’.

(d) INFORMATION ON CSOS AND SSOS.—

(1) REPORT TO CONGRESS.—Not later than 3 years after

the date of enactment of this Act, the Administrator of the

Environmental Protection Agency shall transmit to Congress

a report summarizing—

(A) the extent of the human health and environmental

impacts caused by municipal combined sewer overflows

and sanitary sewer overflows, including the location of

discharges causing such impacts, the volume of pollutants

discharged, and the constituents discharged;

(B) the resources spent by municipalities to address

these impacts; and

(C) an evaluation of the technologies used by municipalities to address these impacts.

(2) TECHNOLOGY CLEARINGHOUSE.—After transmitting a

report under paragraph (1), the Administrator shall maintain

a clearinghouse of cost-effective and efficient technologies for

addressing human health and environmental impacts due to

municipal combined sewer overflows and sanitary sewer overflows.

114 STAT. 2763A–228 PUBLIC LAW 106–554—APPENDIX D

SEC. 113. FISH PASSAGE DEVICES AT NEW SAVANNAH BLUFF

LOCK AND DAM, SOUTH CAROLINA. Section 348(l)(2) of the Water

Resources Development Act of 2000 is amended—

(1) in subparagraph (A), by striking ‘‘Dam, at Federal

expense of an estimated $5,300,000’’ and inserting ‘‘Dam and

construct appropriate fish passage devices at the Dam, at Federal expense’’; and

(2) in subparagraph (B), by striking ‘‘after repair and

rehabilitation,’’ and inserting ‘‘after carrying out subparagraph

(A),’’.

SEC. 114. (a) EXTINGUISHMENT OF REVERSIONARY INTERESTS

AND USE RESTRICTIONS.—With respect to the lands described in

the deed described in subsection (b)—

(1) the reversionary interests and the use restrictions relating to port or industrial purposes are extinguished;

(2) the human habitation or other building structure use

restriction is extinguished in each area where the elevation

is above the standard project flood elevation; and

(3) the use of fill material to raise areas above the standard

project flood elevation, without increasing the risk of flooding

in or outside of the floodplain, is authorized, except in any

area constituting wetland for which a permit under section

404 of the Federal Water Pollution Control Act (33 U.S.C.

1344) would be required.

(b) AFFECTED DEED.—The deed referred to is the deed recorded

October 17, 1967, in book 291, page 148, Deed of Records of Umatilla

County, Oregon, executed by the United States.

SEC. 115. MURRIETA CREEK, CALIFORNIA. Section 101(b)(6) of

the Water Resources Development Act of 2000 is repealed.

SEC. 116. PENN MINE, CALAVERAS COUNTY, CALIFORNIA. (a)

IN GENERAL.—The Secretary of the Army shall reimburse East

Bay Municipal Water District for the project for aquatic ecosystem

restoration, Penn Mine, Calaveras County, California, carried out

under section 206 of the Water Resources Development Act of

1996 (33 U.S.C. 2330), $4,100,000 for the Federal share of costs

incurred by East Bay Municipal Utility District for work carried

out by East Bay Municipal Utility District for the project. Such

amounts shall be made available within 90 days of enactment

of this provision.

(b) SOURCE OF FUNDING.—Reimbursement under subsection (a)

shall be from amounts appropriated before the date of enactment

of this Act for the project described in subsection (a).

SEC. 117. The project for flood control, Greers Ferry Lake,

Arkansas, authorized by the Rivers and Harbors Act of June 28,

1938 (52 Stat. 1218), is modified to authorize the Secretary of

the Army to construct intake facilities for the benefit of Lonoke

and White Counties, Arkansas.

SEC. 118. The project for flood control, Chehalis River and

Tributaries, Washington, authorized by section 401(a) of the Water

Resources Development Act of 1986 (100 Stat. 4126), is modified

to authorize the Secretary of the Army to provide the non-Federal

interest credit toward the non-Federal share of the cost of the

project the cost of planning, design, and construction work carried

out by the non-Federal interest before the date of execution of

a cooperation agreement for the project if the Secretary determines

that the work is integral to the project.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–229

SEC. 119. Within the funds appropriated to the National Park

Service under the heading ‘‘Operation of the National Park System’’ in Public Law 106–291, the Secretary of the Interior shall provide a grant of $75,000 to the City of Ocean Beach, New York, for

repair of facilities at the Ocean Beach Pavilion at Fire Island

National Seashore.

SEC. 120. The National Park Service is directed to work with

Fort Sumter Tours, Inc., the concessionaire currently providing

services at Fort Sumter National Monument in South Carolina,

on an amicable solution of the current legal dispute between the

two parties. The Director of the Service is directed to extend immediately the current contract through March 15, 2001, to facilitate

further negotiations and for 180 days if final settlement of all

disputes is agreed to by both parties.

SEC. 121. Title VIII—Land Conservation, Preservation, and

Infrastructure Improvement of Public Law 106–291 is amended

as follows: after the first dollar amount insert: ‘‘, to be derived

from the Land and Water Conservation Fund’’. SEC. 122. GAS TO LIQUIDS. Section 301(2) of the Energy Policy

Act of 1992 (Public Law 102–486; 42 U.S.C. 13211(2)) is amended

by inserting ‘‘, including liquid fuels domestically produced from

natural gas’’ after ‘‘natural gas’’.

SEC. 124. APPALACHIAN NATIONAL SCENIC TRAIL. (a) ACQUISITIONS.—

(1) IN GENERAL.—The Secretary of the Interior shall—

(A) negotiate agreements with landowners setting

terms and conditions for the acquisition of parcels of land

and interests in land totaling approximately 580 acres at

Saddleback Mountain near Rangeley, Maine, for the benefit

of the Appalachian National Scenic Trail;

(B) complete the pending environmental compliance

process for the acquisitions; and

(C) acquire the parcels of land and interests in land

for consideration in the amount of $4,000,000 plus closing

costs customarily paid by the United States.

(2) ACCEPTANCE OF DONATIONS.—The Secretary may accept

as donations parcels of land and interests in land at Saddleback

Mountain, in addition to those acquired by purchase under

paragraph (1), for the benefit of the Appalachian National

Scenic Trail.

(b) CONVEYANCE TO THE STATE.—The Secretary shall convey

to the State of Maine a portion of the land and interests in land

acquired under subsection (a) without consideration, subject to such

terms and conditions as the Secretary and the State of Maine

agree are necessary to ensure the protection of the Appalachian

National Scenic Trail.

SEC. 125. The provisions of S. 2273, as passed in the United

States Senate on October 5, 2000 and engrossed, are hereby enacted

into law.

SEC. 126. Section 116(a)(1)(A) of the Illinois and Michigan

Canal National Heritage Corridor Act of 1984 (98 Stat. 1467) is

amended by striking ‘‘$250,000’’ and inserting ‘‘$1,000,000’’.

SEC. 127. The provisions of S. 2885, as passed in the United

States Senate on October 5, 2000 and engrossed, are hereby enacted

into law.

SEC. 128. None of the funds provided in this or any other

Act may be used prior to July 31, 2001, to promulgate or enforce

114 STAT. 2763A–230 PUBLIC LAW 106–554—APPENDIX D

a final rule to reduce during the 2000–2001 or 2001–2002 winter

seasons the use of snowmobiles below current use patterns at

a unit in the National Park System: Provided, That nothing in

this section shall be interpreted as amending any requirement

of the Clean Air Act: Provided further, That nothing in this section

shall preclude the Secretary from taking emergency actions related

to snowmobile use in any National Park based on authorities which

existed to permit such emergency actions as of the date of enactment

of this Act.

SEC. 129. The Secretary of the Interior shall extend until March

31, 2001, the ‘‘Extension of Standstill Agreement,’’ entered into

on November 22, 1999, by the United States of America and the

holders of interests in seven campsite leases in Biscayne Bay,

Miami-Dade County, Florida collectively known as ‘‘Stiltsville’’.

SEC. 130. The Secretary of the Interior is authorized to make

a grant of $1,300,000 to the State of Minnesota or its political

subdivision from funds available to the National Park Service under

the heading ‘‘Land Acquisition and State Assistance’’ in Public

Law 106–291 to cover the cost of acquisition of land in Lower

Phalen Creek near St. Paul, Minnesota in the Mississippi National

River and Recreation Area.

SEC. 131. Notwithstanding any provision of law or regulation,

funds appropriated in Public Law 106–291 for a cooperative agreement for management of George Washington’s Boyhood Home, Ferry

Farm, shall be transferred to the George Washington’s Fredericksburg Foundation, Inc. (formerly known as Kenmore Association,

Inc.) immediately upon signing of the cooperative agreement.

SEC. 132. During the period beginning on the date of the

enactment of this Act and ending on June 1, 2001, funds made

available to the Secretary of the Interior may not be used to

pay salaries or expenses related to the issuance of a request for

proposal related to a light rail system to service Grand Canyon

National Park.

SEC. 133. None of the funds in this or any other Act may

be used by the Secretary of the Interior to remove the five-foottall white cross located within the boundary of the Mojave National

Preserve in southern California first erected in 1934 by the Veterans

of Foreign Wars along Cima Road approximately 11 miles south

of Interstate 15.

SEC. 134. Section 6(g) of the Chesapeake and Ohio Canal

Development Act (16 U.S.C. 410y–4(g)) is amended by striking

‘‘thirty’’ and inserting ‘‘40’’.

SEC. 135. Funds provided in Public Law 106–291 for Federal

land acquisition by the National Park Service in Fiscal Year 2001

for Brandywine Battlefield, Ice Age National Scenic Trail, Mississippi National River and Recreation Area, Shenandoah National

Heritage Area, Fallen Timbers Battlefield and Fort Miamis National

Historic Site may be used for a grant to a State, local government,

or to a land management entity for the acquisition of lands without

regard to any restriction on the use of Federal land acquisition

funds provided through the Land and Water Conservation Act

of 1965.

SEC. 136. Notwithstanding any other provision of law, in accordance with title IV—Wildland Fire Emergency Appropriations, Public

Law 106–291, from the $35,000,000 provided for community and

private land fire assistance, the Secretary of Agriculture, may use

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–231

up to $9,000,000 for advance, direct lump sum payments for assistance to eligible individuals, businesses, or other entities, to accomplish the purposes of providing assistance to non-Federal entities

most affected by fire. To expedite such financial assistance being

provided to eligible recipients, the lump sum payments shall not

be subject to 7 CFR 3015, 3019, and 3052 related to the administration of Federal financial assistance.

SEC. 137. (a) IN GENERAL.—The first section of Public Law

91–660 (16 U.S.C. 459h) is amended— (1) in the first sentence, by striking ‘‘That, in’’ and inserting

the following:

‘‘SECTION 1. GULF ISLANDS NATIONAL SEASHORE.

‘‘(a) ESTABLISHMENT.—In’’; and

(2) in the second sentence— (A) by redesignating paragraphs (1) through (6) as

subparagraphs (A) through (F), respectively, and indenting

appropriately;

(B) by striking ‘‘The seashore shall comprise’’ and

inserting the following: ‘‘(b) COMPOSITION.—

‘‘(1) IN GENERAL.—The seashore shall comprise the areas

described in paragraphs (2) and (3).

‘‘(2) AREAS INCLUDED IN BOUNDARY PLAN NUMBERED NS–

GI–7100J.—The areas described in this paragraph are’’: and

(C) by adding at the end the following:

‘‘(3) CAT ISLAND.—Upon its acquisition by the Secretary,

the area described in this paragraph is the parcel consisting

of approximately 2,000 acres of land on Cat Island, Mississippi,

as generally depicted on the map entitled ‘Boundary Map,

Gulf Islands National Seashore, Cat Island, Mississippi’, numbered 635/80085, and dated November 9, 1999 (referred to

in this title as the ‘Cat Island Map’).

‘‘(4) AVAILABILITY OF MAP.—The Cat Island Map shall be

on file and available for public inspection in the appropriate

offices of the National Park Service.’’.

(b) ACQUISITION AUTHORITY.—Section 2 of Public Law 91–660

(16 U.S.C. 459h–1) is amended—

(1) in the first sentence of subsection (a), by striking

‘‘lands,’’ and inserting ‘‘submerged land, land,’’; and

(2) by adding at the end the following:

‘‘(e) ACQUISITION AUTHORITY.—

‘‘(1) IN GENERAL.—The Secretary may acquire, from a willing seller only—

‘‘(A) all land comprising the parcel described in subsection (b)(3) that is above the mean line of ordinary high

tide, lying and being situated in Harrison County, Mississippi;

‘‘(B) an easement over the approximately 150-acre parcel depicted as the ‘Boddie Family Tract’ on the Cat Island

Map for the purpose of implementing an agreement with

the owners of the parcel concerning the development and

use of the parcel; and

‘‘(C)(i) land and interests in land on Cat Island outside

the 2,000-acre area depicted on the Cat Island Map; and

‘‘(ii) submerged land that lies within 1 mile seaward

of Cat Island (referred to in this title as the ‘buffer zone’),

114 STAT. 2763A–232 PUBLIC LAW 106–554—APPENDIX D

except that submerged land owned by the State of Mississippi (or a subdivision of the State) may be acquired

only by donation.

‘‘(2) ADMINISTRATION.— ‘‘(A) IN GENERAL.—Land and interests in land acquired

under this subsection shall be administered by the Secretary, acting through the Director of the National Park

Service. ‘‘(B) BUFFER ZONE.—Nothing in this title or any other

provision of law shall require the State of Mississippi to

convey to the Secretary any right, title, or interest in

or to the buffer zone as a condition for the establishment

of the buffer zone.

‘‘(3) MODIFICATION OF BOUNDARY.—The boundary of the

seashore shall be modified to reflect the acquisition of land

under this subsection only after completion of the acquisition.’’. (c) REGULATION OF FISHING.—Section 3 of Public Law 91–660

(16 U.S.C. 459h–2) is amended—

(1) by inserting ‘‘(a) IN GENERAL.—’’ before ‘‘The Secretary’’;

and

(2) by adding at the end the following:

‘‘(b) NO AUTHORITY TO REGULATE MARITIME ACTIVITIES.—Nothing in this title or any other provision of law shall affect any

right of the State of Mississippi, or give the Secretary any authority,

to regulate maritime activities, including nonseashore fishing activities (including shrimping), in any area that, on the date of enactment of this subsection, is outside the designated boundary of

the seashore (including the buffer zone).’’.

(d) AUTHORIZATION OF MANAGEMENT AGREEMENTS.—Section 5

of Public Law 91–660 (16 U.S.C. 459h–4) is amended—

(1) by inserting ‘‘(a) IN GENERAL.—’’ before ‘‘Except’’; and

(2) by adding at the end the following:

‘‘(b) AGREEMENTS.—

‘‘(1) IN GENERAL.—The Secretary may enter into

agreements— ‘‘(A) with the State of Mississippi for the purposes

of managing resources and providing law enforcement

assistance, subject to authorization by State law, and emergency services on or within any land on Cat Island and

any water and submerged land within the buffer zone;

and

‘‘(B) with the owners of the approximately 150-acre

parcel depicted as the ‘Boddie Family Tract’ on the Cat

Island Map concerning the development and use of the

land.

‘‘(2) NO AUTHORITY TO ENFORCE CERTAIN REGULATIONS.—

Nothing in this subsection authorizes the Secretary to enforce

Federal regulations outside the land area within the designated

boundary of the seashore.’’.

(e) AUTHORIZATION OF APPROPRIATIONS.—Section 11 of Public

Law 91–660 (16 U.S.C. 459h–10) is amended— (1) by inserting ‘‘(a) IN GENERAL.—’’ before ‘‘There’’; and

(2) by adding at the end the following:

‘‘(b) AUTHORIZATION FOR ACQUISITION OF LAND.—In addition

to the funds authorized by subsection (a), there are authorized

to be appropriated such sums as are necessary to acquire land

and submerged land on and adjacent to Cat Island, Mississippi.’’.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–233

SEC. 138. PERCENTAGE LIMITATIONS ON FEDERAL THRIFT SAVINGS PLAN CONTRIBUTIONS. (a) AMENDMENTS RELATING TO FERS.—

(1) IN GENERAL.—Subsection (a) of section 8432 of title

5, United States Code, is amended—

(A) by striking ‘‘(a)’’ and inserting ‘‘(a)(1)’’;

(B) by striking ‘‘10 percent’’ and all that follows through

‘‘period.’’ and inserting ‘‘the maximum percentage of such

employee’s or Member’s basic pay for such pay period allowable under paragraph (2).’’; and

(C) by adding at the end the following:

‘‘(2) The maximum percentage allowable under this paragraph

shall be determined in accordance with the following table:

‘‘In the case of a pay period beginning in fiscal year: The maximum

percentage

allowable is:

2001 .................................................................................................................. 11

2002 .................................................................................................................. 12

2003 .................................................................................................................. 13

2004 .................................................................................................................. 14

2005 .................................................................................................................. 15

2006 or thereafter ........................................................................................... 100.’’.

(2) JUSTICES AND JUDGES.—Paragraph (2) of section

8440a(b) of title 5, United States Code, is amended to read

as follows:

‘‘(2) The amount contributed by a justice or judge for any

pay period shall not exceed the maximum percentage of such justice’s or judge’s basic pay for such pay period allowable under

section 8440f.’’.

(3) BANKRUPTCY JUDGES AND MAGISTRATES.—Paragraph (2)

of section 8440b(b) of title 5, United States Code, is amended

by striking ‘‘5 percent’’ and all that follows through ‘‘period.’’

and inserting ‘‘the maximum percentage of such bankruptcy

judge’s or magistrate’s basic pay for such pay period allowable

under section 8440f.’’.

(4) COURT OF FEDERAL CLAIMS JUDGES.—Paragraph (2) of

section 8440c(b) of title 5, United States Code, is amended

by striking ‘‘5 percent’’ and all that follows through ‘‘period.’’

and inserting ‘‘the maximum percentage of such judge’s basic

pay for such pay period allowable under section 8440f.’’.

(5) JUDGES OF THE UNITED STATES COURT OF APPEALS FOR

VETERANS CLAIMS.—The first sentence of section 8440d(b)(2)

of title 5, United States Code, is amended to read as follows:

‘‘The amount contributed by a judge of the United States Court

of Appeals for Veterans Claims for any pay period may not

exceed the maximum percentage of such judge’s basic pay for

such pay period allowable under section 8440f.’’.

(6) MEMBERS OF THE UNIFORMED SERVICES.—

(A) BASIC PAY.—Subparagraph (A) of section

8440e(d)(1) of title 5, United States Code, is amended by

striking ‘‘5 percent’’ and all that follows through ‘‘period.’’

and inserting ‘‘the maximum percentage of such member’s

basic pay for such pay period allowable under section

8440f.’’.

(B) COMPENSATION.—Subparagraph (B) of section

8440e(d)(1) of title 5, United States Code, is amended by

striking ‘‘5 percent’’ and all that follows through ‘‘period.’’

and inserting ‘‘the maximum percentage of such member’s

114 STAT. 2763A–234 PUBLIC LAW 106–554—APPENDIX D

compensation for such pay period (received under such

section 206) allowable under section 8440f.’’.

(7) MAXIMUM PERCENTAGE ALLOWABLE.—

(A) IN GENERAL.—Title 5, United States Code, is

amended by inserting after section 8440e the following:

‘‘§ 8440f. Maximum percentage allowable for certain participants

‘‘The maximum percentage allowable under this section shall

be determined in accordance with the following table:

‘‘In the case of a pay period beginning in fiscal year: The maximum

percentage

allowable is:

2001 .................................................................................................................. 6

2002 .................................................................................................................. 7

2003 .................................................................................................................. 8

2004 .................................................................................................................. 9

2005 .................................................................................................................. 10

2006 or thereafter ........................................................................................... 100.’’.

(B) CONFORMING AMENDMENT.—The table of sections

for chapter 84 of title 5, United States Code, is amended

by inserting after the item relating to section 8440e the

following:

‘‘8440f. Maximum percentage allowable for certain participants.’’.

(b) AMENDMENTS RELATING TO CSRS.—Paragraph (2) of section

8351(b) of title 5, United States Code, is amended—

(1) by striking ‘‘(2)’’ and inserting ‘‘(2)(A)’’;

(2) by striking ‘‘5 percent’’ and all that follows through

‘‘period.’’ and inserting ‘‘the maximum percentage of such

employee’s or Member’s basic pay for such pay period allowable

under subparagraph (B).’’; and

(3) by adding at the end the following:

‘‘(B) The maximum percentage allowable under this subparagraph shall be determined in accordance with the following table:

‘‘In the case of a pay period beginning in fiscal year: The maximum

percentage

allowable is:

2001 .................................................................................................................. 6

2002 .................................................................................................................. 7

2003 .................................................................................................................. 8

2004 .................................................................................................................. 9

2005 .................................................................................................................. 10

2006 or thereafter ........................................................................................... 100.’’.

(c) EFFECTIVE DATE.—

(1) IN GENERAL.—The amendments made by this section

shall take effect on the date of enactment of this Act.

(2) COORDINATION WITH ELECTION PERIODS.—The Executive

Director shall by regulation determine the first election period

in which elections may be made consistent with the amendments made by this section.

(3) DEFINITIONS.—For purposes of this section—

(A) the term ‘‘election period’’ means a period afforded

under section 8432(b) of title 5, United States Code; and

(B) the term ‘‘Executive Director’’ has the meaning

given such term by section 8401(13) of title 5, United

States Code.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–235

SEC. 139. EXCLUSION OF ELEMENTS OF UNITED STATES SECRET

SERVICE FROM CERTAIN ACTIVITIES. Section 7103(a)(3) of title 5,

United States Code, is amended—

(1) in subparagraph (F), by striking ‘‘or’’ at the end;

(2) in subparagraph (G), by striking the period and inserting ‘‘; or’’; and

(3) by adding at the end the following new subparagraph:

‘‘(H) the United States Secret Service and the United

States Secret Service Uniformed Division.’’.

SEC. 140. (a) The adjustment in rates of basic pay for the

statutory pay systems that takes effect in fiscal year 2001 under

sections 5303 and 5304 of title 5, United States Code, shall be

an increase of 3.7 percent.

(b) Funds used to carry out this section shall be paid from

appropriations which are made to each applicable department or

agency for salaries and expenses for fiscal year 2001.

SEC. 141. REPEAL OF MANDATORY SEPARATION REQUIREMENT.

(a) IN GENERAL.—Section 8335 of title 5, United States Code, is

amended—

(1) by striking subsection (c); and

(2) by redesignating subsections (d) and (e) as subsections

(c) and (d), respectively.

(b) TECHNICAL AND CONFORMING AMENDMENT.—Section 8339(q)

of title 5, United States Code, is amended by striking ‘‘8335(d)’’

and inserting ‘‘8335(c)’’.

SEC. 142. Section 223(a)(14) of the Juvenile Justice and Delinquency Prevention Act of 1974 (42 U.S.C. 5633(a)(14) as amended,

is hereby amended by inserting after the phrase ‘‘twenty-four hours’’

the following new phrase: ‘‘(except in the case of Alaska where

such time limit may be forty-eight hours in fiscal years 2000 through

2002)’’.

SEC. 143. (a) Section 336 of the Communications Act of 1934

(47 U.S.C. 336) is amended—

(1) by redesignating subsection (h) as subsection (i); and

(2) by inserting after subsection (g) the following:

‘‘(h)(1) Within 60 days after receiving a request (made in such

form and manner and containing such information as the Commission may require) under this subsection from a low-power television

station to which this subsection applies, the Commission shall

authorize the licensee or permittee of that station to provide digital

data service subject to the requirements of this subsection as a

pilot project to demonstrate the feasibility of using low-power television stations to provide high-speed wireless digital data service,

including Internet access to unserved areas.

‘‘(2) The low-power television stations to which this subsection applies are as follows:

‘‘(A) KHLM–LP, Houston, Texas.

‘‘(B) WTAM–LP, Tampa, Florida.

‘‘(C) WWRJ–LP, Jacksonville, Florida.

‘‘(D) WVBG–LP, Albany, New York.

‘‘(E) KHHI–LP, Honolulu, Hawaii.

‘‘(F) KPHE–LP (K19DD), Phoenix, Arizona.

‘‘(G) K34FI, Bozeman, Montana.

‘‘(H) K65GZ, Bozeman, Montana.

‘‘(I) WXOB–LP, Richmond, Virginia.

‘‘(J) WIIW–LP, Nashville, Tennessee.

114 STAT. 2763A–236 PUBLIC LAW 106–554—APPENDIX D

‘‘(K) A station and repeaters to be determined by the

Federal Communications Commission for the sole purpose

of providing service to communities in the Kenai Peninsula

Borough and Matanuska Susitna Borough.

‘‘(L) WSPY–LP, Plano, Illinois.

‘‘(M) W24AJ, Aurora, Illinois.

‘‘(3) Notwithstanding any requirement of section 553 of

title 5, United States Code, the Commission shall promulgate

regulations establishing the procedures, consistent with the

requirements of paragraphs (4) and (5), governing the pilot

projects for the provision of digital data services by certain

low power television licensees within 120 days after the date

of enactment of LPTV Digital Data Services Act. The regulations shall set forth—

‘‘(A) requirements as to the form, manner, and information required for submitting requests to the Commission

to provide digital data service as a pilot project;

‘‘(B) procedures for testing interference to digital television receivers caused by any pilot project station or

remote transmitter;

‘‘(C) procedures for terminating any pilot project station

or remote transmitter or both that causes interference to

any analog or digital full-power television stations, class

A television station, television translators or any other

users of the core television band;

‘‘(D) specifications for reports to be filed quarterly by

each low power television licensee participating in a pilot

project;

‘‘(E) procedures by which a low power television

licensee participating in a pilot project shall notify television broadcast stations in the same market upon

commencement of digital data services and for ongoing

coordination with local broadcasters during the test period;

and

‘‘(F) procedures for the receipt and review of interference complaints on an expedited basis consistent with

paragraph (5)(D).

‘‘(4) A low-power television station to which this subsection

applies may not provide digital data service unless—

‘‘(A) the provision of that service, including any remote

return-path transmission in the case of 2-way digital data

service, does not cause any interference in violation of

the Commission’s existing rules, regarding interference

caused by low power television stations to full-service analog or digital television stations, class A television stations,

or television translator stations; and

‘‘(B) the station complies with the Commission’s regulations governing safety, environmental, and sound engineering practices, and any other Commission regulation under

paragraph (3) governing pilot program operations.

‘‘(5)(A) The Commission may limit the provision of digital

data service by a low-power television station to which this

subsection applies if the Commission finds that—

‘‘(i) the provision of 2-way digital data service by that

station causes any interference that cannot otherwise be

remedied; or

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–237

‘‘(ii) the provision of 1-way digital data service by that

station causes any interference.

‘‘(B) The Commission shall grant any such station, upon

application (made in such form and manner and containing

such information as the Commission may require) by the

licensee or permittee of that station, authority to move the

station to another location, to modify its facilities to operate

on a different channel, or to use booster or auxiliary transmitting locations, if the grant of authority will not cause interference to the allowable or protected service areas of full service

digital television stations, National Television Standards

Committee assignments, or television translator stations, and

provided, however, no such authority shall be granted unless

it is consistent with existing Commission regulations relating

to the movement, modification, and use of non-class A low

power television transmission facilities in order—

‘‘(i) to operate within television channels 2 through

51, inclusive; or

‘‘(ii) to demonstrate the utility of low-power television

stations to provide high-speed 2-way wireless digital data

service.

‘‘(C) The Commission shall require quarterly reports from

each station authorized to provide digital data services under

this subsection that include—

‘‘(i) information on the station’s experience with interference complaints and the resolution thereof;

‘‘(ii) information on the station’s market success in

providing digital data service; and

‘‘(iii) such other information as the Commission may

require in order to administer this subsection.

‘‘(D) The Commission shall resolve any complaints of interference with television reception caused by any station providing digital data service authorized under this subsection within

60 days after the complaint is received by the Commission.

‘‘(6) The Commission shall assess and collect from any

low-power television station authorized to provide digital data

service under this subsection an annual fee or other schedule

or method of payment comparable to any fee imposed under

the authority of this Act on providers of similar services.

Amounts received by the Commission under this paragraph

may be retained by the Commission as an offsetting collection

to the extent necessary to cover the costs of developing and

implementing the pilot program authorized by this subsection,

and regulating and supervising the provision of digital data

service by low-power television stations under this subsection.

Amounts received by the Commission under this paragraph

in excess of any amount retained under the preceding sentence

shall be deposited in the Treasury in accordance with chapter

33 of title 31, United States Code.

‘‘(7) In this subsection, the term ‘digital data service’

includes—

‘‘(A) digitally-based interactive broadcast service; and

‘‘(B) wireless Internet access, without regard to—

‘‘(i) whether such access is—

‘‘(I) provided on a one-way or a two-way basis;

‘‘(II) portable or fixed; or

114 STAT. 2763A–238 PUBLIC LAW 106–554—APPENDIX D

‘‘(III) connected to the Internet via a band

allocated to Interactive Video and Data Service;

and

‘‘(ii) the technology employed in delivering such

service, including the delivery of such service via multiple transmitters at multiple locations.

‘‘(8) Nothing in this subsection limits the authority of the

Commission under any other provision of law.’’.

(b) The Federal Communications Commission shall submit a

report to the Congress on June 30, 2001, and June 30, 2002,

evaluating the utility of using low-power television stations to provide high-speed digital data service. The reports shall be based

on the pilot projects authorized by section 336(h) of the Communications Act of 1934 (47 U.S.C. 336(h)).

SEC. 144. (a) The Magnuson-Stevens Fishery Conservation and

Management Act (16 U.S.C. 1801 et. seq.) is amended—

(1) in section 303(d)(1)(A) by striking ‘‘October 1, 2000,’’

and inserting ‘‘October 1, 2002,’’;

(2) in section 303(d)(5) by striking ‘‘October 1, 2000,’’ and

inserting ‘‘October 1, 2002,’’;

(3) in section 407(b) by striking ‘‘October 1, 2000,’’ and

inserting ‘‘October 1, 2002,’’; and

(4) in section 407(c)(1) by striking ‘‘October 1, 2000,’’ and

inserting ‘‘October 1, 2002,’’.

(b) Notwithstanding sections 303(d)(1)(A) and 303(d)(1)(B) of

the Magnuson-Stevens Fishery Conservation and Management Act,

as amended by this section, the Pacific Fishery Management Council

may recommend and the Secretary of Commerce may approve and

implement any fishery management plan, plan amendment, or regulation, for fixed gear sablefish subject to the jurisdiction of such

Council, that—

(1) allows the use of more than one groundfish fishing

permit by each fishing vessel; and/or

(2) sets cumulative trip limit periods, up to 12 months

in any calendar year, that allow fishing vessels a reasonable

opportunity to harvest the full amount of the associated trip

limits.

Notwithstanding subsection (a), the Gulf of Mexico Fishery Management Council may develop a biological, economic, and social profile

of any fishery under its jurisdiction that may be considered for

management under a quota management system, including the

benefits and consequences of the quota management systems considered. The North Pacific Fishery Management Council shall examine

the fisheries under its jurisdiction, particularly the Gulf of Alaska

groundfish and Bering Sea crab fisheries, to determine whether

rationalization is needed. In particular, the North Pacific Council

shall analyze individual fishing quotas, processor quotas, cooperatives, and quotas held by communities. The analysis should include

an economic analysis of the impact of all options on communities

and processors as well as the fishing fleets. The North Pacific

Council shall present its analysis to the appropriations and

authorizing committees of the Senate and House of Representatives

in a timely manner.

(c)(1) Public Law 101–380, as amended by section 2204 of

chapter 2 of title II of Public Law 106–246, is amended further—

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–239

(A) by striking the second sentence of section 5008(c) and

inserting in lieu thereof ‘‘The Federal Advisory Committee Act

(5 U.S.C. App. 2) shall not apply to the Institute.’’;

(B) by inserting the following sentence at the end of section

5008(e): ‘‘The administrative funds of the Institute and the

administrative funds of the North Pacific Research Board created under Public Law 105–83 may be used to jointly administer such programs at the discretion of the North Pacific

Research Board.’’; and

(C) in section 5006(c), as amended by this Act or any

other Act making appropriations for fiscal year 2001, by striking

the colon immediately before the first proviso and inserting

in lieu thereof, ‘‘of which up to $3,000,000 may be used for

the lease payment to the Alaska SeaLife Center under section

5008(b)(2):’’.

(2) Section 401(e) of Public Law 105–83 is amended—

(A) in paragraph (2) by striking ‘‘and recommended for

Secretarial approval’’;

(B) in paragraph (3)(A) by striking ‘‘, who shall be a cochair of the Board’’;

(C) in paragraph (3)(F) by striking ‘‘, who shall be a cochair of the Board’’;

(D) in paragraph (4)(A) by striking ‘‘and administer’’;

(E) in paragraph (4)(B) by striking the first sentence;

(F) by adding at the end the following new paragraph:

‘‘(5) All decisions of the Board, including grant recommendations, shall be by majority vote of the members listed

in paragraphs (3)(A), (3)(F), (3)(G), (3)(J), and (3)(N), in consultation with the other members. The five voting members

may act on behalf of the Board in all matters of administration,

including the disposition of research funds not made available

by this section, at any time on or after October 1, 2000.’’;

and

(G) in paragraph (3) by adding at the end the following:

‘‘(N) one member who shall represent fishing interests

and shall be nominated by the Board and appointed by

the Secretary.’’.

(3) Funds made available for the construction of the NOAA

laboratory at Lena Point shall be considered incremental funding

for the initial phase of construction at Lena Point for site work

and related infrastructure and systems installation.

(4) Notwithstanding any other provision of law, funds made

available by this Act or any other Act for the Alaska SeaLife

Center shall be considered direct payments for all purposes of

applicable law.

(5) Public Law 99–5 is amended—

(A) by inserting after section 3(e) the following:

‘‘(f) The United States shall be represented on the

Transboundary Panel by seven panel members, of whom—

‘‘(1) one shall be an official of the United States Government, with salmon fishery management responsibility and

expertise;

‘‘(2) one shall be an official of the State of Alaska, with

salmon fishery management responsibility and expertise; and

‘‘(3) five shall be individuals knowledgeable and experienced in the salmon fisheries for which the Transboundary

Panel is responsible.’’;

114 STAT. 2763A–240 PUBLIC LAW 106–554—APPENDIX D

(B) by renumbering the remaining subsections;

(C) in section 3(g), as redesignated by this subsection,

by striking ‘‘The appointing authorities’’ and inserting in lieu

thereof ‘‘For the northern, southern, and Fraser River panels,

the appointing authorities’’; and

(D) in section 3(h)(3), as redesignated by this subsection,

by striking ‘‘northern and southern’’ and inserting in lieu

thereof ‘‘northern, southern, and transboundary’’.

(6) The fishery research vessel for which funds were appropriated in Public Law 106–113 shall be homeported in Kodiak,

Alaska, and is hereby named ‘‘OSCAR DYSON’’.

(d)(1) The Secretary of Commerce (hereinafter ‘‘the Secretary’’)

shall, after notice and opportunity for public comment, adopt final

regulations not later than May 1, 2001 to implement a fishing

capacity reduction program for crab fisheries included in the Fishery

Management Plan for Commercial King and Tanner Crab Fisheries

in the Bering Sea and Aleutian Islands (hereinafter ‘‘BSAI crab

fisheries’’). In implementing the program the Secretary shall—

(A) reduce the fishing capacity in the BSAI crab fisheries

by permanently reducing the number of license limitation program crab licenses;

(B) permanently revoke all fishery licenses, fishery permits,

area and species endorsements, and any other fishery privileges, for all fisheries subject to the jurisdiction of the United

States, issued to a vessel or vessels (or to persons on the

basis of their operation or ownership of that vessel or vessels)

for which a BSAI crab fisheries reduction permit is surrendered

and revoked under section 6011(b) of title 50, Code of Federal

Regulations;

(C) ensure that the Secretary of Transportation is notified

of each vessel for which a reduction permit is surrendered

and revoked under the program, with a request that such

Secretary permanently revoke the fishery endorsement of each

such vessel and refuse permission to transfer any such vessel

to a foreign flag under paragraph (5);

(D) ensure that vessels removed from the BSAI crab fisheries under the program are made permanently ineligible to

participate in any fishery worldwide, and that the owners of

such vessels contractually agree that such vessels will operate

only under the United States flag or be scrapped as a reduction

vessel pursuant to section 600.1011(c) of title 50, Code of Federal Regulations;

(E) ensure that vessels removed from the BSAI crab fisheries, the owners of such vessels, and the holders of fishery

permits for such vessels forever relinquish any claim associated

with such vessel, permits, and any catch history associated

with such vessel or permits that could qualify such vessel,

vessel owner, or permit holder for any present or future limited

access system fishing permits in the United States fisheries

based on such vessel, permits, or catch history;

(F) not include the purchase of Norton Sound red king

crab or Norton Sound blue king crab endorsements in the

program, though any such endorsements associated with a

reduction permit or vessel made ineligible or scrapped under

the program shall also be surrendered and revoked as if surrendered and revoked pursuant to section 600.1011(b) of title 50,

Code of Federal Regulations;

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–241

(G) seek to obtain the maximum sustained reduction in

fishing capacity at the least cost by establishing bidding procedures that—

(i) assign a bid score to each bid by dividing the price

bid for each reduction permit by the total value of the

crab landed in the most recent 5-year period in each crab

fishery from 1990 through 1999 under that permit, with

the value for each year determined by multiplying the

average price per pound published by the State of Alaska

in each year for each crab fishery included in such reduction

permit by the total pounds landed in each crab fishery

under that permit in that year; and

(ii) use a reverse auction in which the lowest bid score

ranks first, followed by each bid with the next lowest

bid score, until the total bid amount of all bids equals

a reduction cost that the next lowest bid would cause

to exceed $100,000,000;

(H) not waive or otherwise make inapplicable any requirements of the License Limitation Program applicable to such

crab fisheries, in particular any requirements in sections

679.4(k) and (l) of title 50, Code of Federal Regulations;

(I) not waive or otherwise make inapplicable any catcher

vessel sideboards implemented under the American Fisheries

Act (AFA), except that the North Pacific Fishery Management

Council shall recommend to the Secretary and to the State

of Alaska, not later than February 16, 2001, and the Secretary

and the State of Alaska shall implement as appropriate, modifications to such sideboards to the extent necessary to permit

AFA catcher vessels that remain in the crab fisheries to share

proportionately in any increase in crab harvest opportunities

that accrue to all remaining AFA and non-AFA catcher vessels

if the fishing capacity reduction program required by this section is implemented;

(J) establish sub-amounts and repayment fees for each

BSAI crab fishery prosecuted under a separate endorsement

for repayment of the reduction loan, such that—

(i) a reduction loan sub-amount is established for each

separate BSAI crab fishery (other than Norton Sound red

king crab or Norton Sound blue king crab) by dividing

the total value of the crab landed in that fishery under

all reduction permits by the total value of all crab landed

under such permits in the BSAI crab fisheries (determined

using the same average prices and years used under

subparagraph (G)(i) of this paragraph), and multiplying

the reduction loan amount by the percentage expressed

by such ratio; and

(ii) fish sellers who participate in the crab fishery

under each endorsement repay the reduction loan subamount attributable to that fishery; and

(K) notwithstanding section 1111(b) of the Merchant

Marine Act, 1936 (46 U.S.C. App. 1279f(b)(4)), establish a repayment period for the reduction loan of not less than 30 years.

(2)(A) Only persons to whom a non-interim BSAI crab

license and an area/species endorsement have been issued

(other than persons to whom only a license and an area/species

endorsement for Norton Sound red king crab or Norton Sound

blue king crab have been issued) for vessels that—

114 STAT. 2763A–242 PUBLIC LAW 106–554—APPENDIX D

(i) qualify under the License Limitation Program criteria set forth in section 679.4 of title 50, Code of Federal

Regulations, and

(ii) have made at least one landing of BSAI crab in

either 1996, 1997, or prior to February 7 in 1998, may

submit a bid in the fishing capacity reduction program

established by this section.

(B) After the date of enactment of this section—

(i) no vessel 60 feet or greater in length overall may

participate in any BSAI crab fishery (other than for Norton

Sound red king crab or Norton Sound blue king crab)

unless such vessel meets the requirements set forth in

subparagraphs (A)(i) and (A)(ii) of this paragraph; and

(ii) no vessel between 33 and 60 feet in length overall

may participate in any BSAI crab fishery (other than for

Norton Sound red king crab or Norton Sound blue king

crab) unless such vessel meets the requirements set forth

in subparagraph (A)(i) of this paragraph. Nothing in this

paragraph shall be construed to affect the requirements

for participation in the fisheries for Norton Sound red

king crab or Norton Sound blue king crab. The Secretary

may, on a case by case basis and after notice and opportunity for public comment, waive the application of

subparagraph (A)(ii) of this paragraph if the Secretary

determines such waiver is necessary to implement one

of the specific exemptions to the recent participation

requirement that were recommended by the North Pacific

Fishery Management Council in the record of its October,

1998 meeting.

(3) The fishing capacity reduction program required under

this subsection shall be implemented under this subsection

and sections 312(b)–(e) of the Magnuson-Stevens Fishery Conservation and Management Act (16 U.S.C. 1861a(b)–(e)). Section

312 and the regulations found in Subpart L of Part 600 of

title 50, Code of Federal Regulations, shall apply only to the

extent such section or regulations are not inconsistent with

or made inapplicable by the specific provisions of this subsection. Sections 600.1001, 600.1002, 600.1003, 600.1005,

600.1010(b), 600.1010(d)(1), 600.1011(d), the last sentence of

600.1011(a), and the last sentence of 600.1014(f ) of such Subpart shall not apply to the program implemented under this

subsection. The program shall be deemed accepted under section 600.1004, and any time period specified in Subpart L

that would prevent the Secretary from complying with the

May 1, 2001 date required by this subsection shall be modified

as appropriate to permit compliance with that date. The referendum required for the program under this subsection shall

be a post-bidding referendum under section 600.1010 of title

50, Code of Federal Regulations.

(4)(A) The fishing capacity reduction program required

under this subsection is authorized to be financed in equal

parts through a reduction loan of $50,000,000 under sections

1111 and 1112 of title XI of the Merchant Marine Act, 1936

(46 U.S.C. App. 1279f and 1279g) and $50,000,000 which is

authorized to be appropriated for the purposes of such program.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–243

(B) Of the $1,000,000 appropriated in section 120 of division

A of Public Law 105–277 for the cost of a direct loan in

the Bering Sea and Aleutian Islands crab fisheries—

(i) $500,000 shall be for the cost of guaranteeing the

reduction loan required under subparagraph (A) of this

paragraph in accordance with the requirements of the Federal Credit Reform Act; and

(ii) $500,000 shall be available to the Secretary to

pay for the cost of implementing the fishing capacity reduction program required by this subsection.

(C) The funds described in this subsection shall remain

available, without fiscal year limitation, until expended. Any

funds not used for the fishing capacity reduction program

required by this subsection, whether due to a rejection by

referendum or otherwise, shall be available on or after October

15, 2002, without fiscal year limitation, for assistance to fishermen or fishing communities.

(5)(A) The Secretary of Transportation shall, upon notification and request by the Secretary, for each vessel identified

in such notification and request—

(i) permanently revoke any fishery endorsement issued

to such vessel under section 12108 of title 46, United

States Code; and

(ii) refuse to grant the approval required under section

9(c)(2) of the Shipping Act, 1916 (46 U.S.C. App. 808(c)(2))

for the placement of such vessel under foreign registry

or the operation of such vessel under the authority of

a foreign country.

(B) The Secretary shall, after notice and opportunity for

public comment, adopt final regulations not later than May

1, 2001, to prohibit any vessel for which a reduction permit

is surrendered and revoked under the fishing capacity reduction

program required by this section from engaging in fishing

activities on the high seas or under the jurisdiction of any

foreign country while operating under the United States flag.

(6) The purpose of this subsection is to implement a fishing

capacity reduction program for the BSAI crab fisheries that

results in final action to permanently remove harvesting capacity from such fisheries prior to December 31, 2001. In

implementing this subsection the Secretary is directed to use,

to the extent practicable, information collected and maintained

by the State of Alaska. Any requirements of the Paperwork

Reduction Act, the Regulatory Flexibility Act, or any Executive

order that would, in the opinion of the Secretary, prevent

the Secretary from meeting the deadlines set forth in this

subsection shall not apply to the fishing capacity reduction

program or the promulgation of regulations to implement such

program required by this subsection. Nothing in this subsection

shall be construed to prohibit the North Pacific Fishery

Management Council from recommending, or the Secretary

from approving, changes to any Fishery Management Plan,

License Limitation Program, or American Fisheries Act provisions affecting catcher vessel sideboards in accordance with

applicable law: Provided, That except as specifically provided

in this subsection, such Council may not recommend, and the

Secretary may not approve, any action that would have the

114 STAT. 2763A–244 PUBLIC LAW 106–554—APPENDIX D

effect of increasing the number of vessels eligible to participate

in the BSAI crab fisheries after March 1, 2001.

(e)(1) This subsection may be referred to as the ‘‘Pribilof Islands

Transition Act’’.

(2) The purpose of this subsection is to complete the orderly

withdrawal of the National Oceanic and Atmospheric Administration from the civil administration of the Pribilof Islands, Alaska.

(3) Public Law 89–702 (16 U.S.C. 1151 et seq.), popularly known

and referred to in this subsection as the Fur Seal Act of 1966,

is amended by amending section 206 (16 U.S.C. 1166) to read

as follows:

‘‘SEC. 206. (a)(1) Subject to the availability of appropriations,

the Secretary shall provide financial assistance to any city government, village corporation, or tribal council of St. George, Alaska,

or St. Paul, Alaska. ‘‘(2) Notwithstanding any other provision of law relating to

matching funds, funds provided by the Secretary as assistance

under this subsection may be used by the entity as non-Federal

matching funds under any Federal program that requires such

matching funds. ‘‘(3) The Secretary may not use financial assistance authorized

by this Act—

‘‘(A) to settle any debt owed to the United States;

‘‘(B) for administrative or overhead expenses; or

‘‘(C) for contributions sought or required from any person

for costs or fees to clean up any matter that was caused or

contributed to by such person on or after March 15, 2000.

‘‘(4) In providing assistance under this subsection the Secretary

shall transfer any funds appropriated to carry out this section

to the Secretary of the Interior, who shall obligate such funds

through instruments and procedures that are equivalent to the

instruments and procedures required to be used by the Bureau

of Indian Affairs pursuant to title IV of the Indian Self-Determination and Education Assistance Act (25 U.S.C. 450 et seq.).

‘‘(5) In any fiscal year for which less than all of the funds

authorized under subsection (c)(1) are appropriated, such funds

shall be distributed under this subsection on a pro rata basis

among the entities referred to in subsection (c)(1) in the same

proportions in which amounts are authorized by that subsection

for grants to those entities.

‘‘(b)(1) Subject to the availability of appropriations, the Secretary shall provide assistance to the State of Alaska for designing,

locating, constructing, redeveloping, permitting, or certifying solid

waste management facilities on the Pribilof Islands to be operated

under permits issued to the City of St. George and the City of

St. Paul, Alaska, by the State of Alaska under section 46.03.100

of the Alaska Statutes.

‘‘(2) The Secretary shall transfer any appropriations received

under paragraph (1) to the State of Alaska for the benefit of rural

and Native villages in Alaska for obligation under section 303

of Public Law 104–182, except that subsection (b) of that section

shall not apply to those funds.

‘‘(3) In order to be eligible to receive financial assistance under

this subsection, not later than 180 days after the date of enactment

of this paragraph, each of the Cities of St. Paul and St. George

shall enter into a written agreement with the State of Alaska

under which such City shall identify by its legal boundaries the

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–245

tract or tracts of land that such City has selected as the site

for its solid waste management facility and any supporting infrastructure.

‘‘(c) There are authorized to be appropriated to the Secretary

for fiscal years 2001, 2002, 2003, 2004, and 2005—

‘‘(1) for assistance under subsection (a) a total not to

exceed—

‘‘(A) $9,000,000, for grants to the City of St. Paul;

‘‘(B) $6,300,000, for grants to the Tanadgusix Corporation;

‘‘(C) $1,500,000, for grants to the St. Paul Tribal Council;

‘‘(D) $6,000,000, for grants to the City of St. George;

‘‘(E) $4,200,000, for grants to the St. George Tanaq

Corporation; and

‘‘(F) $1,000,000, for grants to the St. George Tribal

Council; and

‘‘(2) for assistance under subsection (b), for fiscal years

2001, 2002, 2003, 2004, and 2005 a total not to exceed—

‘‘(A) $6,500,000 for the City of St. Paul; and

‘‘(B) $3,500,000 for the City of St. George.

‘‘(d) None of the funds authorized by this section may be available for any activity a purpose of which is to influence legislation

pending before the Congress, except that this subsection shall not

prevent officers or employees of the United States or of its departments, agencies, or commissions from communicating to Members

of Congress, through proper channels, requests for legislation or

appropriations that they consider necessary for the efficient conduct

of public business.

‘‘(e) Neither the United States nor any of its agencies, officers,

or employees shall have any liability under this Act or any other

law associated with or resulting from the designing, locating,

contracting for, redeveloping, permitting, certifying, operating, or

maintaining any solid waste management facility on the Pribilof

Islands as a consequence of—

‘‘(1) having provided assistance to the State of Alaska under

subsection (b); or

‘‘(2) providing funds for, or planning, constructing, or

operating, any interim solid waste management facilities that

may be required by the State of Alaska before permanent

solid waste management facilities constructed with assistance

provided under subsection (b) are complete and operational.

‘‘(f ) Each entity which receives assistance authorized under

subsection (c) shall submit an audited statement listing the expenditure of that assistance to the Committee on Appropriations and

the Committee on Resources of the House of Representatives and

the Committee on Appropriations and the Committee on Commerce,

Science, and Transportation of the Senate, on the last day of fiscal

years 2002, 2004, and 2006.

‘‘(g) Amounts authorized under subsection (c) are intended by

Congress to be provided in addition to the base funding appropriated

to the National Oceanic and Atmospheric Administration in fiscal

year 2000.’’.

(4) Section 205 of the Fur Seal Act of 1966 (16 U.S.C. 1165)

is amended—

(A) by amending subsection (c) to read as follows:

114 STAT. 2763A–246 PUBLIC LAW 106–554—APPENDIX D

‘‘(c) Not later than 3 months after the date of the enactment

of the Pribilof Islands Transition Act, the Secretary shall submit

to the Committee on Commerce, Science, and Transportation of

the Senate and the Committee on Resources of the House of Representatives a report that includes—

‘‘(1) a description of all property specified in the document

referred to in subsection (a) that has been conveyed under

that subsection;

‘‘(2) a description of all Federal property specified in the

document referred to in subsection (a) that is going to be

conveyed under that subsection; and

‘‘(3) an identification of all Federal property on the Pribilof

Islands that will be retained by the Federal Government to

meet its responsibilities under this Act, the Convention, and

any other applicable law.’’; and

(B) by striking subsection (g).

(5)(A)(i) The Secretary of Commerce shall not be considered

to have any obligation to promote or otherwise provide for the

development of any form of an economy not dependent on sealing

on the Pribilof Islands, Alaska, including any obligation under

section 206 of the Fur Seal Act of 1966 (16 U.S.C. 1166) or section

3(c)(1)(A) of Public Law 104–91 (16 U.S.C. 1165 note).

(ii) This subparagraph shall not affect any cause of action

under section 206 of the Fur Seal Act of 1966 (16 U.S.C. 1166)

or section 3(c)(1)(A) of Public Law 104–91 (16 U.S.C. 1165 note)—

(I) that arose before the date of the enactment of this

title; and

(II) for which a judicial action is filed before the expiration

of the 5-year period beginning on the date of the enactment

of this title.

(iii) Nothing in this subsection shall be construed to imply

that—

(I) any obligation to promote or otherwise provide for the

development in the Pribilof Islands of any form of an economy

not dependent on sealing was or was not established by section

206 of the Fur Seal Act of 1966 (16 U.S.C. 1166), section

3(c)(1)(A) of Public Law 104–91 (16 U.S.C. 1165 note), or any

other provision of law; or

(II) any cause of action could or could not arise with respect

to such an obligation.

(iv) Section 3(c)(1) of Public Law 104–91 (16 U.S.C. 1165 note)

is amended by striking subparagraph (A) and redesignating subparagraphs (B) through (D) in order as subparagraphs (A) through

(C).

(B)(i) Subject to paragraph (5)(B)(ii), there are terminated all

obligations of the Secretary of Commerce and the United States

to—

(I) convey property under section 205 of the Fur Seal Act

of 1966 (16 U.S.C. 1165); and

(II) carry out cleanup activities, including assessment,

response, remediation, and monitoring, except for postremedial

measures such as monitoring and operation and maintenance

activities related to National Oceanic and Atmospheric

Administration administration of the Pribilof Islands, Alaska,

under section 3 of Public Law 104–91 (16 U.S.C. 1165 note)

and the Pribilof Islands Environmental Restoration Agreement

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–247

between the National Oceanic and Atmospheric Administration

and the State of Alaska, signed January 26, 1996.

(ii) Paragraph (5)(B)(i) shall apply on and after the date on

which the Secretary of Commerce certifies that—

(I) the State of Alaska has provided written confirmation

that no further corrective action is required at the sites and

operable units covered by the Pribilof Islands Environmental

Restoration Agreement between the National Oceanic and

Atmospheric Administration and the State of Alaska, signed

January 26, 1996, with the exception of postremedial measures,

such as monitoring and operation and maintenance activities;

(II) the cleanup required under section 3(a) of Public Law

104–91 (16 U.S.C. 1165 note) is complete;

(III) the properties specified in the document referred to

in subsection (a) of section 205 of the Fur Seal Act of 1966

(16 U.S.C. 1165(a)) can be unconditionally offered for conveyance under that section; and

(IV) all amounts appropriated under section 206(c)(1) of

the Fur Seal Act of 1966, as amended by this title, have

been obligated.

(iii)(I) On and after the date on which section 3(b)(5) of Public

Law 104–91 (16 U.S.C. 1165 note) is repealed pursuant to subparagraph (C), the Secretary of Commerce may not seek or require

financial contribution by or from any local governmental entity

of the Pribilof Islands, any official of such an entity, or the owner

of land on the Pribilof Islands, for cleanup costs incurred pursuant

to section 3(a) of Public Law 104–91 (as in effect before such

repeal), except as provided in subparagraph (B)(iii)(II).

(II) Subparagraph (B)(iii)(I) shall not limit the authority

of the Secretary of Commerce to seek or require financial contribution from any person for costs or fees to clean up any

matter that was caused or contributed to by such person on

or after March 15, 2000.

(iv) For purposes of paragraph (2)(C), the following requirements shall not be considered to be conditions on conveyance of

property:

(I) Any requirement that a potential transferee must allow

the National Oceanic and Atmospheric Administration continued access to the property to conduct environmental monitoring

following remediation activities.

(II) Any requirement that a potential transferee must allow

the National Oceanic and Atmospheric Administration access

to the property to continue the operation, and eventual closure,

of treatment facilities.

(III) Any requirement that a potential transferee must

comply with institutional controls to ensure that an environmental cleanup remains protective of human health or the

environment that do not unreasonably affect the use of the

property.

(IV) Valid existing rights in the property, including rights

granted by contract, permit, right-of-way, or easement.

(V) The terms of the documents described in subparagraph

(D)(ii).

(C) Effective on the date on which the Secretary of Commerce

makes the certification described in subparagraph (b)(2), the following provisions are repealed:

114 STAT. 2763A–248 PUBLIC LAW 106–554—APPENDIX D

(i) Section 205 of the Fur Seal Act of 1966 (16 U.S.C.

1165).

(ii) Section 3 of Public Law 104–91 (16 U.S.C. 1165 note).

(D)(i) Nothing in this subsection shall affect any obligation

of the Secretary of Commerce, or of any Federal department or

agency, under or with respect to any document described in subparagraph (D)(ii) or with respect to any lands subject to such a document.

(ii) The documents referred to in subparagraph (D)(i) are the

following:

(I) The Transfer of Property on the Pribilof Islands: Description, Terms, and Conditions, dated February 10, 1984, between

the Secretary of Commerce and various Pribilof Island entities.

(II) The Settlement Agreement between Tanadgusix Corporation and the City of St. Paul, dated January 11, 1988,

and approved by the Secretary of Commerce on February 23,

1988.

(III) The Memorandum of Understanding between

Tanadgusix Corporation, Tanaq Corporation, and the Secretary

of Commerce, dated December 22, 1976.

(E)(i) Except as provided in subparagraph (E)(ii), the definitions

set forth in section 101 of the Fur Seal Act of 1966 (16 U.S.C.

1151) shall apply to this paragraph.

(ii) For purposes of this paragraph, the term ‘‘Natives of the

Pribilof Islands’’ includes the Tanadgusix Corporation, the St.

George Tanaq Corporation, and the city governments and tribal

councils of St. Paul and St. George, Alaska.

(6)(A) Section 3 of Public Law 104–91 (16 U.S.C. 1165 note)

and the Fur Seal Act of 1966 (16 U.S.C. 1151 et seq.) are amended

by—

(i) striking ‘‘(d)’’ and all that follows through the heading

for subsection (d) of section 3 of Public Law 104–91 and inserting ‘‘SEC. 212.’’; and

(ii) moving and redesignating such subsection so as to

appear as section 212 of the Fur Seal Act of 1966.

(B) Section 201 of the Fur Seal Act of 1966 (16 U.S.C. 1161)

is amended by striking ‘‘on such Islands’’ and insert ‘‘on such

property’’.

(C) The Fur Seal Act of 1966 (16 U.S.C. 1151 et seq.) is

amended by inserting before title I the following:

‘‘SECTION 1. This Act may be cited as the ‘Fur Seal Act of

1966’.’’.

(7) Section 3 of Public Law 104–91 (16 U.S.C. 1165 note)

is amended—

(A) by striking subsection (f ) and inserting the following:

‘‘(f )(1) There are authorized to be appropriated $10,000,000

for each of fiscal years 2001, 2002, 2003, 2004, and 2005 for the

purposes of carrying out this section.

‘‘(2) None of the funds authorized by this subsection may be

expended for the purpose of cleaning up or remediating any landfills, wastes, dumps, debris, storage tanks, property, hazardous

or unsafe conditions, or contaminants, including petroleum products

and their derivatives, left by the Department of Defense or any

of its components on lands on the Pribilof Islands, Alaska.’’; and

(B) by adding at the end the following:

‘‘(g)(1) Of amounts authorized under subsection (f ) for each

of fiscal years 2001, 2002, 2003, 2004, and 2005, the Secretary

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–249

may provide to the State of Alaska up to $2,000,000 per fiscal

year to capitalize a revolving fund to be used by the State for

loans under this subsection. ‘‘(2) The Secretary shall require that any revolving fund established with amounts provided under this subsection shall be used

only to provide low-interest loans to Natives of the Pribilof Islands

to assess, respond to, remediate, and monitor contamination from

lead paint, asbestos, and petroleum from underground storage

tanks.

‘‘(3) The definitions set forth in section 101 of the Fur Seal

Act of 1966 (16 U.S.C. 1151) shall apply to this section, except

that the term ‘Natives of the Pribilof Islands’ includes the

Tanadgusix and Tanaq Corporations.

‘‘(4) Before the Secretary may provide any funds to the State

of Alaska under this section, the State of Alaska and the Secretary

must agree in writing that, on the last day of fiscal year 2011,

and of each fiscal year thereafter until the full amount provided

to the State of Alaska by the Secretary under this section has

been repaid to the United States, the State of Alaska shall transfer

to the Treasury of the United States monies remaining in the

revolving fund, including principal and interest paid into the revolving fund as repayment of loans.’’.

(f )(1) The President, after consultation with the Governor of

the State of Hawaii, may designate any Northwestern Hawaiian

Islands coral reef or coral reef ecosystem as a coral reef reserve

to be managed by the Secretary of Commerce.

(2) Upon the designation of a reserve under paragraph (1)

by the President, the Secretary shall—

(A) take action to initiate the designation of the reserve

as a National Marine Sanctuary under sections 303 and 304

of the National Marine Sanctuaries Act (16 U.S.C. 1433);

(B) establish a Northwestern Hawaiian Islands Reserve

Advisory Council under section 315 of that Act (16 U.S.C.

1445a), the membership of which shall include at least one

representative from Native Hawaiian groups; and

(C) until the reserve is designated as a National Marine

Sanctuary, manage the reserve in a manner consistent with

the purposes and policies of that Act.

(3) Notwithstanding any other provision of law, no closure

areas around the Northwestern Hawaiian Islands shall become

permanent without adequate review and comment.

(4) The Secretary shall work with other Federal agencies and

the Director of the National Science Foundation, to develop a coordinated plan to make vessels and other resources available for conservation or research activities for the reserve.

(5) If the Secretary has not designated a national marine sanctuary in the Northwestern Hawaiian Islands under sections 303

and 304 of the National Marine Sanctuaries Act (16 U.S.C. 1433,

1434) before October 1, 2005, the Secretary shall conduct a review

of the management of the reserve under section 304(e) of that

Act (16 U.S.C. 1434(e)).

(6) No later than 6 months after the date of enactment of

this Act, the Secretary shall submit a report to the Senate Committee on Commerce, Science, and Transportation and the House of

Representatives Committee on Resources, describing actions taken

to implement this subsection, including costs of monitoring, enforcing, and addressing marine debris, and the extent to which the

114 STAT. 2763A–250 PUBLIC LAW 106–554—APPENDIX D

fiscal or other resources necessary to carry out this subsection

are reflected in the Budget of the United States Government submitted by the President under section 1104 of title 31, United States

Code.

(7) There are authorized to be appropriated to the Secretary

of Commerce to carry out the provisions of this subsection such

sums, not exceeding $4,000,000 for each of fiscal years 2001, 2002,

2003, 2004, and 2005, as are reported under paragraph (5) to

be reflected in the Budget of the United States Government.

(g) Section 111(b)(1) of the Sustainable Fisheries Act (16 U.S.C.

1855 nt) is amended by striking the last sentence and inserting,

‘‘There are authorized to be appropriated to carry out this subsection

$500,000 for each fiscal year.’’.

SEC. 145. (a) Section 4(b)(1) of the Department of State Special

Agents Retirement Act of 1998 (22 U.S.C. 4044 note; Public Law

105–382; 112 Stat. 3409) is amended by inserting ‘‘or participant

who was serving as of January 1, 1997’’ after ‘‘employed participant’’.

(b) The amendment made by this section shall take effect

on January 1, 2001.

SEC. 146. (a) Congress makes the following findings:

(1) Total steel imports in 2000 will be over 21⁄2 times

higher than in 1991, continuing the alarming trend of sharply

increasing steel imports over the past decade.

(2) Unprecedented levels of steel imports flooded the United

States market in 1998 and 1999, causing a crisis in which

thousands of steelworkers were laid off and six steel companies

went bankrupt.

(3) The domestic steel industry still has not had an opportunity to recover from the 1998–1999 steel import crisis, and

steel imports are again causing serious injury to United States

steel producers and workers.

(4) Total steel imports through August 2000 are 17 percent

higher than over the same period in 1999 and greater even

than imports over the same period in 1998, a record year.

(5) Steel prices continue to be depressed, with hot-rolled

steel prices 12 percent lower in August 2000 than in the first

quarter of 1998, and average import customs values for all

steel products more than 15 percent lower over the same period.

(6) The United States Government must maintain and

fully enforce all existing relief against foreign unfair trade.

(7) The United States steel industry is a clean, highly

efficient industry having modernized itself at great human

and financial cost, shedding over 330,000 jobs and investing

more than $50,000,000,000 over the last 20 years.

(8) Capacity utilization in the United States steel industry

has fallen sharply since the beginning of the year and the

market capitalization and debt ratings of the major United

States steel firms are at precarious levels.

(9) The Department of Commerce recently documented the

underlying market-distorting practices and longstanding structural problems that plague the global steel trade with excess

capacity and cause diversion of unfairly traded foreign steel

to the United States.

(10) The President recognized that unfair trade played

a significant role in the devastating import surge of steel and

recognized the need to vigorously enforce the trade laws.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–251

(b) Congress calls upon the President— (1) to take all appropriate action within his power to provide relief from injury caused by steel imports; and

(2) to immediately request the United States International

Trade Commission to commence an expedited investigation for

positive adjustment under section 201 of the Trade Act of

1974 of such steel imports.

SEC. 147. Section 5(b)(1) of the Act of January 2, 1951 (15

U.S.C. 1175(b)(1); popularly known as the ‘‘Johnson Act’’) is amended by inserting ‘‘for a voyage or a segment of a voyage that begins

and ends in the State of Hawaii, or’’ after ‘‘Except’’. SEC. 148. (a) Section 312(a)(7) of the Communications Act of

1934 (47 U.S.C. 312(a)(7)) is amended by inserting ‘‘, other than

a non-commercial educational broadcast station,’’ after ‘‘use of a

broadcasting station’’. (b) The Federal Communications Commission shall take no

action against any non-commercial educational broadcast station

which declines to carry a political advertisement.

SEC. 149. The Small Business Innovation Research program,

otherwise expiring at the end of fiscal year 2000, is authorized

to continue in effect during fiscal year 2001.

SEC. 150. There is hereby appropriated for payment to the

Ricky Ray Hemophilia Relief Fund, as provided by Public Law

105–369, $105,000,000, of which notwithstanding any other provision of law $10,000,000 shall be for program management of the

Health Resources and Services Administration, to remain available

until expended.

SEC. 151. (a) There is hereby appropriated to a separate account

to be established in the Department of Labor for expenses of administering the Energy Employees Occupational Illness Compensation

Act, $60,400,000, to remain available until expended: Provided,

That the Secretary of Labor is authorized to transfer to any Executive agency with authority under the Energy Employees Occupational Illness Compensation Act, such sums as may be necessary

in FY 2001 to carry out those authorities.

(b) For purposes of the Balanced Budget and Emergency Deficit

Control Act of 1985, amounts appropriated under subsection (a)

shall be direct spending: Provided, That amounts appropriated

annually thereafter for such administrative expenses shall be direct

spending.

SEC. 152. TREATMENT OF CERTAIN CANCER HOSPITALS. (a) IN

GENERAL.—Section 1886(d)(1)(B)(v) of the Social Security Act (42

U.S.C. 1395ww(d)(1)(B)(v)) is amended—

(1) in subclause (I) by striking ‘‘or’’ at the end;

(2) in subclause (II) by striking the semicolon at the end

and inserting ‘‘, or’’; and

(3) by adding at the end the following:

‘‘(III) a hospital that was recognized as a clinical cancer

research center by the National Cancer Institute of the National

Institutes of Health as of February 18, 1998, that has never

been reimbursed for inpatient hospital services pursuant to

a reimbursement system under a demonstration project under

section 1814(b), that is a freestanding facility organized primarily for treatment of and research on cancer and is not

a unit of another hospital, that as of the date of the enactment

of this subclause, is licensed for 162 acute care beds, and

that demonstrates for the 4-year period ending on June 30,

114 STAT. 2763A–252 PUBLIC LAW 106–554—APPENDIX D

1999, that at least 50 percent of its total discharges have

a principal finding of neoplastic disease, as defined in subparagraph (E);’’ and

(b) CONFORMING AMENDMENT.—Section 1886(d)(1)(E) of the

Social Security Act (42 U.S.C. 1395ww(d)(1)(E)) is amended by

striking ‘‘For purposes of subparagraph (B)(v)(II)’’ and inserting ‘‘For purposes of subclauses (II) and (III) of subparagraph (B)(v)’’. (c) PAYMENT.— (1) APPLICATION TO COST REPORTING PERIODS.—Any classification by reason of section 1886(d)(1)(B)(v)(III) of the Social

Security Act (as added by subsection (a)) shall apply to 12-

month cost reporting periods beginning on or after July 1,

1999.

(2) BASE YEAR.—Notwithstanding the provisions of section

1886(b)(3)(E) of such Act (42 U.S.C. 1395ww(b)(3)(E)) or other

provisions to the contrary, the base cost reporting period for

purposes of determining the target amount for any hospital

classified by reason of section 1886(d)(1)(B)(v)(III) of such Act

(as added by subsection (a)) shall be the 12-month cost reporting

period beginning on July 1, 1995.

(3) DEADLINE FOR PAYMENTS.—Any payments owed to a

hospital by reason of this subsection shall be made expeditiously, but in no event later than 1 year after the date of

the enactment of this Act.

SEC. 153. (a) Section 4(2) of the Delta Development Act (42

U.S.C. 3121 note; Public Law 100–460) is amended—

(1) by inserting ‘‘Alabama,’’ before ‘‘Arkansas’’;

(2) in paragraph (G), by striking ‘‘and’’ at the end;

(3) in paragraph (H)—

(A) by striking ‘‘and’’ before ‘‘such’’; and

(B) by inserting ‘‘and’’ after the semicolon at the end;

and

(4) by adding at the end the following:

‘‘(I) the Alabama counties of Pickens, Greene, Sumter,

Choctaw, Clarke, Washington, Marengo, Hale, Perry,

Wilcox, Lowndes, Bullock, Macon, Barbour, Russell, and

Dallas;’’;

(b) At the end of section 382A of ‘‘The Delta Regional Authority

Act of 2000’’ as incorporated in this Act, insert the following:

‘‘(4) Notwithstanding any other provision of law, the State

of Alabama shall be a full member of the Delta Regional Authority and shall be entitled to all rights and privileges that said

membership affords to all other participating States in the

Delta Regional Authority.’’.

SEC. 154. NORTHERN WISCONSIN.

(a) DEFINITION OF NORTHERN WISCONSIN.—In this section, the

term ‘‘northern Wisconsin’’ means the counties of Douglas, Ashland,

Bayfield, and Iron, Wisconsin.

(b) ESTABLISHMENT OF PROGRAM.—The Secretary of the Army

may establish a pilot program to provide environmental assistance

to non-Federal interests in northern Wisconsin.

(c) FORM OF ASSISTANCE.—Assistance under this section may

be in the form of design and reconstruction assistance or waterrelated environmental infrastructure and resource protection and

development projects in northern Wisconsin, including projects for

wastewater treatment and related facilities, water supply and

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–253

related facilities, environmental restoration, and surface water

resource protection and development.

(d) PUBLIC OWNERSHIP REQUIREMENT.—The Secretary may provide assistance for a project under this section only if the project

is publicly owned.

(e) LOCAL COOPERATION AGREEMENT.— (1) IN GENERAL.—Before providing assistance under this

section, the Secretary shall enter into a local cooperation agreement with a non-Federal interest to provide for design and

construction of the project to be carried out with the assistance.

(2) REQUIREMENTS.—Each local cooperation agreement

entered into under this subsection shall provide for the following:

(A) PLAN.—Development by the Secretary, in consultation with appropriate Federal and State officials, of a facilities or restructure protection and development plan, including appropriate engineering plans and specifications.

(B) LEGAL AND INSTITUTIONAL STRUCTURES.—

Establishment of such legal and institutional structures

as are necessary to ensure the effective long-term operation

of the project by the non-Federal interest.

(3) COST SHARING.—

(A) IN GENERAL.—The Federal share of project costs

under each local cooperation agreement entered into under

this subsection shall be 75 percent. The Federal share

may be in the form of grants or reimbursements of project

costs.

(B) CREDIT FOR DESIGN WORK.—The non-Federal

interest shall receive credit for the reasonable costs of

design work completed by the non-Federal interest before

entering into a local cooperation agreement with the Secretary for a project. The credit for the design work shall

not exceed 6 percent of the local construction costs of the

project.

(C) CREDIT FOR INTEREST.—In case of a delay in the

funding of the non-Federal share of the costs of a project

that is the subject of an agreement under this subsection,

the non-Federal interest shall receive credit for reasonable

interest incurred in providing the non-Federal share of

the project’s costs.

(D) LAND, EASEMENTS, AND RIGHTS-OF-WAY CREDIT.—

The non-Federal interest shall receive credit for land, easements, rights-of-way, and reductions toward the non-Federal share of project costs (including all reasonable costs

associated with obtaining permits necessary for the

construction, operation, and maintenance of the project

on publicly owned or controlled land), but not to exceed

25 percent of the total project costs.

(E) OPERATION AND MAINTENANCE.—The non-Federal

share of operation and maintenance costs for projects constructed with assistance provided under this section shall

be 100 percent.

(f ) APPLICABILITY OF OTHER FEDERAL AND STATE LAWS.—Nothing in this section waives, limits, or otherwise affects the applicability of any provision of Federal or State law that would otherwise

apply to a project to be carried out with assistance provided under

this section.

114 STAT. 2763A–254 PUBLIC LAW 106–554—APPENDIX D

(g) REPORT.—Not later than December 31, 2001, the Secretary

shall transmit to Congress a report on the results of the pilot

program carried out under this section, including recommendations

concerning whether the program should be implemented on a

national basis.

(h) AUTHORIZATION OF APPROPRIATIONS.—There is authorized

to be appropriated to carry out this section $40,000,000. Such

sums shall remain available until expended.

TITLE II—VIETNAM EDUCATION FOUNDATION ACT OF 2000

SEC. 201. SHORT TITLE.

This title may be cited as the ‘‘Vietnam Education Foundation

Act of 2000’’.

SEC. 202. PURPOSES.

The purposes of this title are the following:

(1) To establish an international fellowship program under

which—

(A) Vietnamese nationals can undertake graduate and

post-graduate level studies in the sciences (natural, physical, and environmental), mathematics, medicine, and technology (including information technology); and

(B) United States citizens can teach in the fields specified in subparagraph (A) in appropriate Vietnamese institutions.

(2) To further the process of reconciliation between the

United States and Vietnam and the building of a bilateral

relationship serving the interests of both countries.

SEC. 203. DEFINITIONS.

In this title:

(1) BOARD.—The term ‘‘Board’’ means the Board of Directors of the Foundation.

(2) FOUNDATION.—The term ‘‘Foundation’’ means the Vietnam Education Foundation established in section 204.

(3) INSTITUTION OF HIGHER EDUCATION.—The term ‘‘institution of higher education’’ has the meaning given the term

in section 101(a) of the Higher Education Act of 1965 (20

U.S.C. 1001(a)).

(4) UNITED STATES-VIETNAM DEBT AGREEMENT.—The term

‘‘United States-Vietnam debt agreement’’ means the Agreement

Between the Government of the United States of America and

the Government of the Socialist Republic of Vietnam Regarding

the Consolidation and Rescheduling of Certain Debts Owed

to, Guaranteed by, or Insured by the United States Government

and the Agency for International Development, dated April

7, 1997.

SEC. 204. ESTABLISHMENT.

There is established the Vietnam Education Foundation as

an independent establishment of the executive branch under section

104 of title 5, United States Code.

SEC. 205. BOARD OF DIRECTORS.

(a) IN GENERAL.—The Foundation shall be subject to the supervision and direction of the Board of Directors, which shall consist

of 13 members, as follows:

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–255

(1) Two members of the House of Representatives appointed

by the Speaker of the House of Representatives, one of whom

shall be appointed upon the recommendation of the Majority

Leader and one of whom shall be appointed upon the recommendation of the Minority Leader, and who shall serve

as ex officio, nonvoting members.

(2) Two members of the Senate, appointed by the President

pro tempore, one of whom shall be appointed upon the recommendation of the Majority Leader and one of whom shall

be appointed upon the recommendation of the Minority Leader,

and who shall serve as ex officio, nonvoting members.

(3) Secretary of State.

(4) Secretary of Education.

(5) Secretary of Treasury.

(6) Six members to be appointed by the President from

among individuals in the nongovernmental sector who have

academic excellence or experience in the fields of concentration

specified in section 202(1)(A) or a general knowledge of Vietnam, not less than three of whom shall be drawn from academic

life.

(b) ROTATION OF MEMBERSHIP.—(1) The term of office of each

member appointed under subsection (a)(6) shall be 3 years, except

that of the members initially appointed under that subsection,

two shall serve for terms of 1 year, two shall serve for terms

of 2 years, and two shall serve for terms of 3 years.

(2) A member of Congress appointed under subsection (a)(1)

or (2) shall not serve as a member of the Board for more than

a total of 6 years.

(c) CHAIR.—The Board shall elect one of the members appointed

under subsection (a)(6) to serve as Chair.

(d) MEETINGS.—The Board shall meet upon the call of the

Chair but not less frequently than twice each year. A majority

of the voting members of the Board shall constitute a quorum.

(e) DUTIES.—The Board shall—

(1) select the individuals who will be eligible to serve

as Fellows; and

(2) provide overall supervision and direction of the Foundation.

(f ) COMPENSATION.—

(1) IN GENERAL.—Except as provided in paragraph (2), each

member of the Board shall serve without compensation, and

members who are officers or employees of the United States

shall serve without compensation in addition to that received

for their services as officers or employees of the United States.

(2) TRAVEL EXPENSES.—The members of the Board shall

be allowed travel expenses, including per diem in lieu of subsistence, at rates authorized for employees of agencies under subchapter I of chapter 57 of title 5, United States Code, while

away from their homes or regular places of business in the

performance of service for the Board.

SEC. 206. FELLOWSHIP PROGRAM.

(a) AWARD OF FELLOWSHIPS.—

(1) IN GENERAL.—To carry out the purposes of this title,

the Foundation shall award fellowships to—

(A) Vietnamese nationals to study at institutions of

higher education in the United States at graduate and

114 STAT. 2763A–256 PUBLIC LAW 106–554—APPENDIX D

post-graduate levels in the following fields: physical

sciences, natural sciences, mathematics, environmental

sciences, medicine, technology, and computer sciences; and

(B) United States citizens to teach in Vietnam in appropriate Vietnamese institutions in the fields of study

described in subparagraph (A).

(2) SPECIAL EMPHASIS ON SCIENTIFIC AND TECHNICAL

VOCABULARY IN ENGLISH.—Fellowships awarded under paragraph (1) may include funding for the study of scientific and

technical vocabulary in English.

(b) CRITERIA FOR SELECTION.—Fellowships under this title shall

be awarded to persons who meet the minimum criteria established

by the Foundation, including the following:

(1) VIETNAMESE NATIONALS.—Vietnamese candidates for

fellowships shall have basic English proficiency and must have

the ability to meet the criteria for admission into graduate

or post-graduate programs in United States institutions of

higher learning.

(2) UNITED STATES CITIZEN TEACHERS.—American teaching

candidates shall be highly competent in their fields and be

experienced and proficient teachers.

(c) IMPLEMENTATION.—The Foundation may provide, directly

or by contract, for the conduct of nationwide competition for the

purpose of selecting recipients of fellowships awarded under this

section.

(d) AUTHORITY TO AWARD FELLOWSHIPS ON A MATCHING

BASIS.—The Foundation may require, as a condition of the availability of funds for the award of a fellowship under this title, that

an institution of higher education make available funds for such

fellowship on a matching basis.

(e) FELLOWSHIP CONDITIONS.—A person awarded a fellowship

under this title may receive payments authorized under this title

only during such periods as the Foundation finds that the person

is maintaining satisfactory proficiency and devoting full time to

study or teaching, as appropriate, and is not engaging in gainful

employment other than employment approved by the Foundation

pursuant to regulations of the Board.

(f ) FUNDING.—

(1) FISCAL YEAR 2001.—

(A) AUTHORIZATION OF APPROPRIATIONS.—There are

authorized to be appropriated to the Foundation $5,000,000

for fiscal year 2001 to carry out the activities of the Foundation.

(B) AVAILABILITY OF FUNDS.—Amounts appropriated

pursuant to subparagraph (A) are authorized to remain

available until expended.

(2) FISCAL YEAR 2002 AND SUBSEQUENT FISCAL YEARS.—

Effective October 1, 2001, the Foundation shall utilize funds

transferred to the Foundation under section 207.

SEC. 207. VIETNAM DEBT REPAYMENT FUND.

(a) ESTABLISHMENT.—Notwithstanding any other provision of

law, there is established in the Treasury a separate account which

shall be known as the Vietnam Debt Repayment Fund (in this

subsection referred to as the ‘‘Fund’’).

(b) DEPOSITS.—There shall be deposited as offsetting receipts

into the Fund all payments (including interest payments) made

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–257

by the Socialist Republic of Vietnam under the United StatesVietnam debt agreement.

(c) AVAILABILITY OF THE FUNDS.—

(1) FISCAL YEAR LIMITATION.—Beginning with fiscal year

2002, and each subsequent fiscal year through fiscal year 2018,

$5,000,000 of the amounts deposited into the Fund (or accrued

interest) each fiscal year shall be available to the Foundation,

without fiscal year limitation, under paragraph (2).

(2) DISBURSEMENT OF FUNDS.—The Secretary of the Treasury, at least on a quarterly basis, shall transfer to the Foundation amounts allotted to the Foundation under paragraph (1)

for the purpose of carrying out its activities.

(3) TRANSFER OF EXCESS FUNDS TO MISCELLANEOUS

RECEIPTS.—Beginning with fiscal year 2002, and each subsequent fiscal year through fiscal year 2018, the Secretary of

the Treasury shall withdraw from the Fund and deposit in

the Treasury of the United States as miscellaneous receipts

all moneys in the Fund in excess of amounts made available

to the Foundation under paragraph (1).

(d) ANNUAL REPORT.—The Board shall prepare and submit

annually to Congress statements of financial condition of the Fund,

including the beginning balance, receipts, refunds to appropriations,

transfers to the general fund, and the ending balance.

SEC. 208. FOUNDATION PERSONNEL MATTERS.

(a) APPOINTMENT BY BOARD.—There shall be an Executive Secretary of the Foundation who shall be appointed by the Board

without regard to the provisions of title 5, United States Code,

or any regulation thereunder, governing appointment in the

competitive service. The Executive Director shall be the Chief

Executive Officer of the Foundation and shall carry out the functions of the Foundation subject to the supervision and direction

of the Board. The Executive Director shall carry out such other

functions consistent with the provisions of this title as the Board

shall prescribe. The decision to employ or terminate an Executive

Director shall be made by an affirmative vote of at least six of

the nine voting members of the Board.

(b) PROFESSIONAL STAFF.—The Executive Director shall hire

Foundation staff on the basis of professional and nonpartisan qualifications.

(c) EXPERTS AND CONSULTANTS.—The Executive Director may

procure temporary and intermittent services of experts and consultants as are necessary to the extent authorized by section 3109

of title 5, United States Code to carry out the purposes of the

Foundation.

(d) COMPENSATION.—The Board may fix the compensation of

the Executive Director and other personnel without regard to the

provisions of chapter 51 and subchapter III of chapter 53 of title

V, United States Code, relating to classification of positions and

General Schedule pay rates, except that the rate of pay for the

Executive Director and other personnel may not exceed the rate

payable for level V of the Executive Schedule under section 5316

of such title.

SEC. 209. ADMINISTRATIVE PROVISIONS.

(a) IN GENERAL.—In order to carry out this title, the Foundation

may—

114 STAT. 2763A–258 PUBLIC LAW 106–554—APPENDIX D

(1) prescribe such regulations as it considers necessary

governing the manner in which its functions shall be carried

out;

(2) receive money and other property donated, bequeathed,

or devised, without condition or restriction other than it be

used for the purposes of the Foundation, and to use, sell,

or otherwise dispose of such property for the purpose of carrying

out its functions;

(3) accept and use the services of voluntary and noncompensated personnel;

(4) enter into contracts or other arrangements, or make

grants, to carry out the provisions of this title, and enter

into such contracts or other arrangements, or make such grants,

with the concurrence of a majority of the members of the

Board, without performance or other bonds and without regard

to section 3709 of the Revised Statutes (41 U.S.C. 5);

(5) rent office space in the District of Columbia; and

(6) make other necessary expenditures.

(b) ANNUAL REPORT.—The Foundation shall submit to the President and to the Committee on Foreign Relations of the Senate

and the Committee on International Relations of the House of

Representatives an annual report of its operations under this title.

SEC. 210. TERMINATION.

(a) IN GENERAL.—The Foundation may not award any new

fellowship, or extend any existing fellowship, after September 30,

2016.

(b) ABOLISHMENT.—Effective 120 days after the expiration of

the last fellowship in effect under this title, the Foundation is

abolished.

TITLE III—COLORADO UTE SETTLEMENT ACT

AMENDMENTS OF 2000

SEC. 301. SHORT TITLE; FINDINGS; DEFINITIONS.

(a) SHORT TITLE.—This title may be cited as the ‘‘Colorado

Ute Settlement Act Amendments of 2000’’.

(b) FINDINGS.—Congress makes the following findings:

(1) In order to provide for a full and final settlement

of the claims of the Colorado Ute Indian Tribes on the Animas

and La Plata Rivers, the Tribes, the State of Colorado, and

certain of the non-Indian parties to the Agreement have proposed certain modifications to the Colorado Ute Indian Water

Rights Settlement Act of 1988 (Public Law 100–585; 102 Stat.

2973).

(2) The claims of the Colorado Ute Indian Tribes on all

rivers in Colorado other than the Animas and La Plata Rivers

have been settled in accordance with the provisions of the

Colorado Ute Indian Water Rights Settlement Act of 1988 (Public Law 100–585; 102 Stat. 2973).

(3) The Indian and non-Indian communities of southwest

Colorado and northwest New Mexico will be benefited by a

settlement of the tribal claims on the Animas and La Plata

Rivers that provides the Tribes with a firm water supply without taking water away from existing uses.

(4) The Agreement contemplated a specific timetable for

the delivery of irrigation and municipal and industrial water

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–259

and other benefits to the Tribes from the Animas-La Plata

Project, which timetable has not been met. The provision of

irrigation water can not presently be satisfied under the current

implementation of the Federal Water Pollution Control Act

(33 U.S.C. 1251 et seq.) and the Endangered Species Act of

1973 (16 U.S.C. 1531 et seq.).

(5) In order to meet the requirements of the Endangered

Species Act of 1973 (16 U.S.C. 1531 et seq.), and in particular

the various biological opinions issued by the Fish and Wildlife

Service, the amendments made by this title are needed to

provide for a significant reduction in the facilities and water

supply contemplated under the Agreement.

(6) The substitute benefits provided to the Tribes under

the amendments made by this title, including the waiver of

capital costs and the provisions of funds for natural resource

enhancement, result in a settlement that provides the Tribes

with benefits that are equivalent to those that the Tribes would

have received under the Colorado Ute Indian Water Rights

Settlement Act of 1988 (Public Law 100–585; 102 Stat. 2973).

(7) The requirement that the Secretary of the Interior

comply with the National Environmental Policy Act of 1969

(42 U.S.C. 4321 et seq.) and other national environmental laws

before implementing the proposed settlement will ensure that

the satisfaction of the tribal water rights is accomplished in

an environmentally responsible fashion.

(8) In considering the full range of alternatives for satisfying the water rights claims of the Southern Ute Indian Tribe

and Ute Mountain Ute Indian Tribe, Congress has held numerous legislative hearings and deliberations, and reviewed the

considerable record including the following documents:

(A) The Final EIS No. INT–FES–80–18, dated July

1, 1980.

(B) The Draft Supplement to the FES No. INT–DES–

92–41, dated October 13, 1992.

(C) The Final Supplemental to the FES No. 96–23,

dated April 26, 1996;

(D) The Draft Supplemental EIS, dated January 14,

2000.

(E) The Final Supplemental EIS, dated July 2000.

(F) The Record of Decision for the Settlement of the

Colorado Ute Indian Waters, September 25, 2000.

(9) In the Record of Decision referred to in paragraph

(8)(F), the Secretary determined that the preferred alternative

could only proceed if Congress amended the Colorado Ute

Indian Water Rights Settlement Act of 1988 (Public Law 100–

585; 102 Stat. 2973) so as to satisfy the Tribal water rights

claim through the construction of the features authorized by

this title. The amendments to the Colorado Ute Indian Water

Rights Settlement Act of 1988 set forth in this title will provide

the Ute Tribes with substitute benefits equivalent to those

that the Tribes would have received under the Colorado Ute

Indian Water Rights Settlement Act of 1988, in a manner

consistent with paragraph (8) and the Federal Government’s

trust obligation.

(10) Based upon paragraph (8), it is the intent of Congress

to enact legislation that implements the Record of Decision

referred to in paragraph (8)(F).

114 STAT. 2763A–260 PUBLIC LAW 106–554—APPENDIX D

(c) DEFINITIONS.—In this title:

(1) AGREEMENT.—The term ‘‘Agreement’’ has the meaning

given that term in section 3(1) of the Colorado Ute Indian

Water Rights Settlement Act of 1988 (Public Law 100–585;

102 Stat. 2973).

(2) ANIMAS-LA PLATA PROJECT.—The term ‘‘Animas-La Plata

Project’’ has the meaning given that term in section 3(2) of

the Colorado Ute Indian Water Rights Settlement Act of 1988

(Public Law 100–585; 102 Stat. 2973).

(3) DOLORES PROJECT.—The term ‘‘Dolores Project’’ has the

meaning given that term in section 3(3) of the Colorado Ute

Indian Water Rights Settlement Act of 1988 (Public Law 100– 585; 102 Stat. 2974).

(4) TRIBE; TRIBES.—The term ‘‘Tribe’’ or ‘‘Tribes’’ has the

meaning given that term in section 3(6) of the Colorado Ute

Indian Water Rights Settlement Act of 1988 (Public Law 100– 585; 102 Stat. 2974).

SEC. 302. AMENDMENTS TO SECTION 6 OF THE COLORADO UTE INDIAN

WATER RIGHTS SETTLEMENT ACT OF 1988.

Subsection (a) of section 6 of the Colorado Ute Indian Water

Rights Settlement Act of 1988 (Public Law 100–585; 102 Stat.

2975) is amended to read as follows:

‘‘(a) RESERVOIR; MUNICIPAL AND INDUSTRIAL WATER.—

‘‘(1) FACILITIES.—

‘‘(A) IN GENERAL.—After the date of enactment of this

subsection, but prior to January 1, 2005, or the date established in the Amended Final Decree described in section

18(c), the Secretary, in order to settle the outstanding

claims of the Tribes on the Animas and La Plata Rivers,

acting through the Bureau of Reclamation, is specifically

authorized to—

‘‘(i) complete construction of, and operate and

maintain, a reservoir, a pumping plant, a reservoir

inlet conduit, and appurtenant facilities with sufficient

capacity to divert and store water from the Animas

River to provide for an average annual depletion of

57,100 acre-feet of water to be used for a municipal

and industrial water supply, which facilities shall—

‘‘(I) be designed and operated in accordance

with the hydrologic regime necessary for the recovery of the endangered fish of the San Juan River

as determined by the San Juan River Recovery

Implementation Program;

‘‘(II) be operated in accordance with the

Animas-La Plata Project Compact as approved by

Congress in Public Law 90–537;

‘‘(III) include an inactive pool of an appropriate

size to be determined by the Secretary following

the completion of required environmental compliance activities; and

‘‘(IV) include those recreation facilities determined to be appropriate by agreement between

the State of Colorado and the Secretary that shall

address the payment of any of the costs of such

facilities by the State of Colorado in addition to

the costs described in paragraph (3); and

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–261

‘‘(ii) deliver, through the use of the project components referred to in clause (i), municipal and industrial

water allocations— ‘‘(I) with an average annual depletion not to

exceed 16,525 acre-feet of water, to the Southern

Ute Indian Tribe for its present and future needs;

‘‘(II) with an average annual depletion not to

exceed 16,525 acre-feet of water, to the Ute Mountain Ute Indian Tribe for its present and future

needs;

‘‘(III) with an average annual depletion not

to exceed 2,340 acre-feet of water, to the Navajo

Nation for its present and future needs;

‘‘(IV) with an average annual depletion not

to exceed 10,400 acre-feet of water, to the San

Juan Water Commission for its present and future

needs;

‘‘(V) with an average annual depletion of an

amount not to exceed 2,600 acre-feet of water,

to the Animas-La Plata Conservancy District for

its present and future needs;

‘‘(VI) with an average annual depletion of an

amount not to exceed 5,230 acre-feet of water,

to the State of Colorado for its present and future

needs; and

‘‘(VII) with an average annual depletion of

an amount not to exceed 780 acre-feet of water,

to the La Plata Conservancy District of New Mexico for its present and future needs.

‘‘(B) APPLICABILITY OF OTHER FEDERAL LAW.—The

responsibilities of the Secretary described in subparagraph

(A) are subject to the requirements of Federal laws related

to the protection of the environment and otherwise

applicable to the construction of the proposed facilities,

including the National Environmental Policy Act of 1969

(42 U.S.C. 4321 et seq.), the Clean Water Act (42 U.S.C.

7401 et seq.), and the Endangered Species Act of 1973

(16 U.S.C. 1531 et seq.). Nothing in this Act shall be

construed to predetermine or otherwise affect the outcome

of any analysis conducted by the Secretary or any other

Federal official under applicable laws.

‘‘(C) LIMITATION.—

‘‘(i) IN GENERAL.—If constructed, the facilities

described in subparagraph (A) shall constitute the

Animas-La Plata Project. Construction of any other

project features authorized by Public Law 90–537 shall

not be commenced without further express authorization from Congress.

‘‘(ii) CONTINGENCY IN APPLICATION.—If the facilities described in subparagraph (A) are not constructed

and operated, clause (i) shall not take effect. ‘‘(2) TRIBAL CONSTRUCTION COSTS.—Construction costs

allocable to the facilities that are required to deliver the municipal and industrial water allocations described in subclauses

(I), (II) and (III) of paragraph (1)(A)(ii) shall be nonreimbursable

to the United States.

‘‘(3) NONTRIBAL WATER CAPITAL OBLIGATIONS.—

114 STAT. 2763A–262 PUBLIC LAW 106–554—APPENDIX D

‘‘(A) IN GENERAL.—Under the provisions of section 9

of the Act of August 4, 1939 (43 U.S.C. 485h), the nontribal

municipal and industrial water capital repayment obligations for the facilities described in paragraph (1)(A)(i) may

be satisfied upon the payment in full of the nontribal

water capital obligations prior to the initiation of construction. The amount of the obligations described in the preceding sentence shall be determined by agreement between

the Secretary of the Interior and the entity responsible

for such repayment as to the appropriate reimbursable

share of the construction costs allocated to that entity’s

municipal water storage. Such repayment shall be consistent with Federal reclamation law, including the Colorado

River Storage Project Act of 1956 (43 U.S.C. 620 et seq.).

Such agreement shall take into account the fact that the

construction of certain project facilities, including those

facilities required to provide irrigation water supplies from

the Animas-La Plata Project, is not authorized under paragraph (1)(A)(i) and no costs associated with the design

or development of such facilities, including costs associated

with environmental compliance, shall be allocable to the

municipal and industrial users of the facilities authorized

under such paragraph.

‘‘(B) NONTRIBAL REPAYMENT OBLIGATION SUBJECT TO

FINAL COST ALLOCATION.—The nontribal repayment obligation set forth in subparagraph (A) shall be subject to a

final cost allocation by the Secretary upon project completion. In the event that the final cost allocation indicates

that additional repayment is warranted based on the

applicable entity’s share of project water storage and determination of overall reimbursable cost, that entity may elect

to enter into a new agreement to make the additional

payment necessary to secure the full water supply identified in paragraph (1)(A)(ii). If the repayment entity elects

not to enter into a new agreement, the portion of project

storage relinquished by such election shall be available

to the Secretary for allocation to other project purposes.

Additional repayment shall only be warranted for reasonable and unforeseen costs associated with project construction as determined by the Secretary in consultation with

the relevant repayment entities.

‘‘(C) REPORT.—Not later than April 1, 2001, the Secretary shall report to Congress on the status of the costshare agreements contemplated in subparagraph (A). In

the event that no agreement is reached with either the

Animas-La Plata Conservancy District or the State of Colorado for the water allocations set forth in subclauses (V)

and (VI) of paragraph (1)(A)(ii), those allocations shall be

reallocated equally to the Colorado Ute Tribes.

‘‘(4) TRIBAL WATER ALLOCATIONS.—

‘‘(A) IN GENERAL.—With respect to municipal and

industrial water allocated to a Tribe from the AnimasLa Plata Project or the Dolores Project, until that water

is first used by a Tribe or used pursuant to a water use

contract with the Tribe, the Secretary shall pay the annual

operation, maintenance, and replacement costs allocable

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–263

to that municipal and industrial water allocation of the

Tribe. ‘‘(B) TREATMENT OF COSTS.—A Tribe shall not be

required to reimburse the Secretary for the payment of

any cost referred to in subparagraph (A).

‘‘(5) REPAYMENT OF PRO RATA SHARE.—Upon a Tribe’s first

use of an increment of a municipal and industrial water allocation described in paragraph (4), or the Tribe’s first use of

such water pursuant to the terms of a water use contract— ‘‘(A) repayment of that increment’s pro rata share of

those allocable construction costs for the Dolores Project

shall be made by the Tribe; and ‘‘(B) the Tribe shall bear a pro rata share of the allocable annual operation, maintenance, and replacement costs

of the increment as referred to in paragraph (4).’’.

SEC. 303. MISCELLANEOUS.

The Colorado Ute Indian Water Rights Settlement Act of 1988

(Public Law 100–585; 102 Stat. 2973) is amended by adding at

the end the following:

‘‘SEC. 15. NEW MEXICO AND NAVAJO NATION WATER MATTERS.

‘‘(a) ASSIGNMENT OF WATER PERMIT.—Upon the request of the

State Engineer of the State of New Mexico, the Secretary shall,

as soon as practicable, in a manner consistent with applicable

law, assign, without consideration, to the New Mexico AnimasLa Plata Project beneficiaries or to the New Mexico Interstate

Stream Commission in accordance with the request of the State

Engineer, the Department of the Interior’s interest in New Mexico

State Engineer Permit Number 2883, dated May 1, 1956, in order

to fulfill the New Mexico non-Navajo purposes of the AnimasLa Plata Project, so long as the permit assignment does not affect

the application of the Endangered Species Act of 1973 (16 U.S.C.

1531 et seq.) to the use of the water involved.

‘‘(b) NAVAJO NATION MUNICIPAL PIPELINE.—The Secretary is

specifically authorized to construct a water line to augment the

existing system that conveys the municipal water supplies, in an

amount not less than 4,680 acre-feet per year, to the Navajo Indian

Reservation at or near Shiprock, New Mexico. The Secretary shall

comply with all applicable environmental laws with respect to such

water line. Construction costs allocated to the Navajo Nation for

such water line shall be nonreimbursable to the United States. ‘‘(c) PROTECTION OF NAVAJO WATER CLAIMS.—Nothing in this

Act, including the permit assignment authorized by subsection (a),

shall be construed to quantify or otherwise adversely affect the

water rights and the claims of entitlement to water of the Navajo

Nation.

‘‘SEC. 16. RESOURCE FUNDS.

‘‘(a) AUTHORIZATION OF APPROPRIATIONS.—There is authorized

to be appropriated to carry out this section, $8,000,000 for each

of fiscal years 2002 through 2006. Not later than 60 days after

amounts are appropriated and available to the Secretary for a

fiscal year under this paragraph, the Secretary shall make a payment to each of the Tribal Resource Funds established under subsection (b). Each such payment shall be equal to 50 percent of

the amount appropriated for the fiscal year involved.

‘‘(b) FUNDS.—The Secretary shall establish a—

114 STAT. 2763A–264 PUBLIC LAW 106–554—APPENDIX D

‘‘(1) Southern Ute Tribal Resource Fund; and

‘‘(2) Ute Mountain Ute Tribal Resource Fund. ‘‘(c) TRIBAL DEVELOPMENT.—

‘‘(1) INVESTMENT.—The Secretary shall, in the absence of

an approved tribal investment plan provided for under paragraph (2), invest the amount in each Tribal Resource Fund

established under subsection (b) in accordance with the Act

entitled, ‘An Act to authorize the deposit and investment of

Indian funds’ approved June 24, 1938 (25 U.S.C. 162a). With

the exception of the funds referred to in paragraph (3)(B)(i),

the Secretary shall disburse, at the request of a Tribe, the

principal and income in its Resource Fund, or any part thereof,

in accordance with a resource acquisition and enhancement

plan approved under paragraph (3). ‘‘(2) INVESTMENT PLAN.— ‘‘(A) IN GENERAL.—In lieu of the investment provided

for in paragraph (1), a Tribe may submit a tribal investment plan applicable to all or part of the Tribe’s Tribal

Resource Fund, except with respect to the funds referred

to in paragraph (3)(B)(i). ‘‘(B) APPROVAL.—Not later than 60 days after the date

on which an investment plan is submitted under subparagraph (A), the Secretary shall approve such investment

plan if the Secretary finds that the plan is reasonable

and sound. If the Secretary does not approve such investment plan, the Secretary shall set forth in writing and

with particularity the reasons for such disapproval. If such

investment plan is approved by the Secretary, the Tribal

Resource Fund involved shall be disbursed to the Tribe

to be invested by the Tribe in accordance with the approved

investment plan, subject to subsection (d).

‘‘(C) COMPLIANCE.—The Secretary may take such steps

as the Secretary determines to be necessary to monitor

the compliance of a Tribe with an investment plan approved

under subparagraph (B). The United States shall not be

responsible for the review, approval, or audit of any individual investment under the plan. The United States shall

not be directly or indirectly liable with respect to any

such investment, including any act or omission of the Tribe

in managing or investing such funds.

‘‘(D) ECONOMIC DEVELOPMENT PLAN.—The principal

and income derived from tribal investments under an

investment plan approved under subparagraph (B) shall

be subject to the provisions of this section and shall be

expended only in accordance with an economic development

plan approved under paragraph (3)(B).

‘‘(3) ECONOMIC DEVELOPMENT PLAN.—

‘‘(A) IN GENERAL.—Each Tribe shall submit to the Secretary a resource acquisition and enhancement plan for

all or any portion of its Tribal Resource Fund.

‘‘(B) APPROVAL.—Not later than 60 days after the date

on which a plan is submitted under subparagraph (A),

the Secretary shall approve such plan if it is consistent

with the following requirements:

‘‘(i) With respect to at least three-fourths of the

funds appropriated pursuant to this section and

consistent with the long-standing practice of the Tribes

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–265

and other local entities and communities to work

together to use their respective water rights and

resources for mutual benefit, at least three-fourths of

the funds appropriated pursuant to this section shall

be utilized to enhance, restore, and utilize the Tribes’

natural resources in partnership with adjacent nonIndian communities or entities in the area.

‘‘(ii) The plan must be reasonably related to the

protection, acquisition, enhancement, or development

of natural resources for the benefit of the Tribe and

its members.

‘‘(iii) Notwithstanding any other provision of law

and in order to ensure that the Federal Government

fulfills the objectives of the Record of Decision referred

to in section 301(b)(8)(F) of the Colorado Ute Settlement Act Amendments of 2000 by requiring that the

funds referred to in clause (i) are expended directly

by employees of the Federal Government, the Secretary

acting through the Bureau of Reclamation shall expend

not less than one-third of the funds referred to in

clause (i) for municipal or rural water development

and not less than two-thirds of the funds referred

to such clause for resource acquisition and enhancement.

‘‘(C) MODIFICATION.—Subject to the provisions of this

Act and the approval of the Secretary, each Tribe may

modify a plan approved under subparagraph (B).

‘‘(D) LIABILITY.—The United States shall not be directly

or indirectly liable for any claim or cause of action arising

from the approval of a plan under this paragraph, or from

the use and expenditure by the Tribe of the principal

or interest of the Funds.

‘‘(d) LIMITATION ON PER CAPITA DISTRIBUTIONS.—No part of

the principal contained in the Tribal Resource Fund, or of the

income accruing to such funds, or the revenue from any water

use contract, shall be distributed to any member of either Tribe

on a per capita basis.

‘‘(e) LIMITATION ON SETTING ASIDE FINAL CONSENT DECREE.—

Neither the Tribes nor the United States shall have the right

to set aside the final consent decree solely because the requirements

of subsection (c) are not complied with or implemented.

‘‘(f ) LIMITATION ON DISBURSEMENT OF TRIBAL RESOURCE

FUNDS.—Any funds appropriated under this section shall be placed

into the Southern Ute Tribal Resource Fund and the Ute Mountain

Ute Tribal Resource Fund in the Treasury of the United States

but shall not be available for disbursement under this section

until the final settlement of the tribal claims as provided in section

18. The Secretary of the Interior may, in the Secretary’s sole discretion, authorize the disbursement of funds prior to the final settlement in the event that the Secretary determines that substantial

portions of the settlement have been completed. In the event that

the funds are not disbursed under the terms of this section by

December 31, 2012, such funds shall be deposited in the general

fund of the Treasury.

114 STAT. 2763A–266 PUBLIC LAW 106–554—APPENDIX D

‘‘SEC. 17. COLORADO UTE SETTLEMENT FUND.

‘‘(a) ESTABLISHMENT OF FUND.—There is hereby established

within the Treasury of the United States a fund to be known

as the ‘Colorado Ute Settlement Fund’.

‘‘(b) AUTHORIZATION OF APPROPRIATIONS.—There is authorized

to be appropriated to the Colorado Ute Settlement Fund such funds

as are necessary to complete the construction of the facilities

described in sections 6(a)(1)(A) and 15(b) within 7 years of the

date of enactment of this section. Such funds are authorized to

be appropriated for each of the first 5 fiscal years beginning with

the first full fiscal year following the date of enactment of this

section.

‘‘SEC. 18. FINAL SETTLEMENT.

‘‘(a) IN GENERAL.—The construction of the facilities described

in section 6(a)(1)(A), the allocation of the water supply from those

facilities to the Tribes as described in that section, and the provision

of funds to the Tribes in accordance with section 16 and the issuance

of an amended final consent decree as contemplated in subsection

(c) shall constitute final settlement of the tribal claims to water

rights on the Animas and La Plata Rivers in the State of Colorado.

‘‘(b) STATUTORY CONSTRUCTION.—Nothing in this section shall

be construed to affect the right of the Tribes to water rights on

the streams and rivers described in the Agreement, other than

the Animas and La Plata Rivers, to receive the amounts of water

dedicated to tribal use under the Agreement, or to acquire water

rights under the laws of the State of Colorado.

‘‘(c) ACTION BY THE ATTORNEY GENERAL.—The Attorney General

shall file with the District Court, Water Division Number 7, of

the State of Colorado, such instruments as may be necessary to

request the court to amend the final consent decree to provide

for the amendments made to this Act under the Colorado Ute

Indian Water Rights Settlement Act Amendments of 2000. The

amended final consent decree shall specify terms and conditions

to provide for an extension of the current January 1, 2005, deadline

for the Tribes to commence litigation of their reserved rights claims

on the Animas and La Plata Rivers.

‘‘SEC. 19. STATUTORY CONSTRUCTION; TREATMENT OF CERTAIN

FUNDS.

‘‘(a) IN GENERAL.—Nothing in the amendments made by the

Colorado Ute Settlement Act Amendments of 2000 shall be construed to affect the applicability of any provision of this Act.

‘‘(b) TREATMENT OF UNCOMMITTED PORTION OF COST-SHARING

OBLIGATION.—The uncommitted portion of the cost-sharing obligation of the State of Colorado referred to in section 6(a)(3) shall

be made available, upon the request of the State of Colorado,

to the State of Colorado after the date on which payment is made

of the amount specified in that section.’’.

TITLE IV

SEC. 401. DESIGNATION OF AMERICAN MUSEUM OF SCIENCE AND

ENERGY.

(a) IN GENERAL.—The Museum—

(1) is designated as the ‘‘American Museum of Science

and Energy’’; and

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–267

(2) shall be the official museum of science and energy

of the United States.

(b) REFERENCES.—Any reference in a law, map, regulation,

document, paper, or other record of the United States to the

Museum is deemed to be a reference to the ‘‘American Museum

of Science and Energy’’.

(c) PROPERTY OF THE UNITED STATES.—

(1) IN GENERAL.—The name ‘‘American Museum of Science

and Energy’’ is declared the property of the United States.

(2) USE.—The Museum shall have the sole right throughout

the United States and its possessions to have and use the

name ‘‘American Museum of Science and Energy’’.

(3) EFFECT ON OTHER RIGHTS.—This subsection shall not

be construed to conflict or interfere with established or vested

rights.

SEC. 402. AUTHORITY.

To carry out the activities of the Museum, the Secretary may—

(1) accept and dispose of any gift, devise, or bequest of

services or property, real or personal, that is—

(A) designated in a written document by the person

making the gift, devise, or bequest as intended for the

Museum; and

(B) determined by the Secretary to be suitable and

beneficial for use by the Museum;

(2) operate a retail outlet on the premises of the Museum

for the purpose of selling or distributing items (including

mementos, food, educational materials, replicas, and literature)

that are—

(A) relevant to the contents of the Museum; and

(B) informative, educational, and tasteful;

(3) collect reasonable fees where feasible and appropriate;

(4) exhibit, perform, display, and publish materials and

information of or relating to the Museum in any media or

place;

(5) consistent with guidelines approved by the Secretary,

lease space on the premises of the Museum at reasonable

rates and for uses consistent with such guidelines; and

(6) use the proceeds of activities authorized under this

section to pay the costs of the Museum.

SEC. 403. MUSEUM VOLUNTEERS.

(a) AUTHORITY TO USE VOLUNTEERS.—The Secretary may

recruit, train, and accept the services of individuals or entities

as volunteers for services or activities related to the Museum.

(b) STATUS OF VOLUNTEERS.—

(1) IN GENERAL.—Except as provided in paragraph (2), service by a volunteer under subsection (a) shall not be considered

Federal employment.

(2) EXCEPTIONS.—

(A) FEDERAL TORT CLAIMS ACT.—For purposes of chapter 171 of title 28, United States Code, a volunteer under

subsection (a) shall be treated as an employee of the

Government (as defined in section 2671 of that title).

(B) COMPENSATION FOR WORK INJURIES.—For purposes

of subchapter I of chapter 81 of title 5, United States

114 STAT. 2763A–268 PUBLIC LAW 106–554—APPENDIX D

Code, a volunteer described in subsection (a) shall be treated as an employee (as defined in section 8101 of title

5, United States Code).

(c) COMPENSATION.—A volunteer under subsection (a) shall

serve without pay, but may receive nominal awards and reimbursement for incidental expenses, including expenses for a uniform

or transportation in furtherance of Museum activities.

SEC. 404. DEFINITIONS.

For purposes of this Act:

(1) MUSEUM.—The term ‘‘Museum’’ means the museum

operated by the Secretary of Energy and located at 300 South

Tulane Avenue in Oak Ridge, Tennessee.

(2) SECRETARY.—The term ‘‘Secretary’’ means the Secretary

of Energy or a designated representative of the Secretary.

TITLE V—LOWER MISSISSIPPI RIVER

REGION

SEC. 501. SHORT TITLE.

This title may be cited as the ‘‘Delta Regional Authority Act

of 2000’’.

SEC. 502. FINDINGS AND PURPOSES.

(a) FINDINGS.—Congress finds that—

(1) the lower Mississippi River region (referred to in this

title as the ‘‘region’’), though rich in natural and human

resources, lags behind the rest of the United States in economic

growth and prosperity;

(2) the region suffers from a greater proportion of measurable poverty and unemployment than any other region of the

United States;

(3) the greatest hope for economic growth and revitalization

in the region lies in the development of transportation infrastructure, creation of jobs, expansion of businesses, and development of entrepreneurial local economies;

(4) the economic progress of the region requires an adequate

transportation and physical infrastructure, a skilled and

trained workforce, and greater opportunities for enterprise

development and entrepreneurship;

(5) a concerted and coordinated effort among Federal, State,

and local agencies, the private sector, and nonprofit groups

is needed if the region is to achieve its full potential for economic development;

(6) economic development planning on a regional or multicounty basis offers the best prospect for achieving the maximum

benefit from public and private investments; and

(7) improving the economy of the region requires a special

emphasis on areas of the region that are most economically

distressed.

(b) PURPOSES.—The purposes of this title are—

(1) to promote and encourage the economic development

of the region—

(A) to ensure that the communities and people in the

region have the opportunity for economic development; and

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–269

(B) to ensure that the economy of the region reaches

economic parity with that of the rest of the United States;

(2) to establish a formal framework for joint Federal-State

collaboration in meeting and focusing national attention on

the economic development needs of the region;

(3) to assist the region in obtaining the transportation

and basic infrastructure, skills training, and opportunities for

economic development that are essential for strong local economies;

(4) to foster coordination among all levels of government,

the private sector, and nonprofit groups in crafting common

regional strategies that will lead to broader economic growth;

(5) to strengthen efforts that emphasize regional

approaches to economic development and planning;

(6) to encourage the participation of interested citizens,

public officials, agencies, and others in developing and

implementing local and regional plans for broad-based economic

and community development; and

(7) to focus special attention on areas of the region that

suffer from the greatest economic distress.

SEC. 503. DELTA REGIONAL AUTHORITY.

The Consolidated Farm and Rural Development Act (7 U.S.C.

1921 et seq.) is amended by adding at the end the following:

‘‘Subtitle F—Delta Regional Authority

‘‘SEC. 382A. DEFINITIONS.

‘‘In this subtitle: ‘‘(1) AUTHORITY.—The term ‘Authority’ means the Delta

Regional Authority established by section 382B. ‘‘(2) REGION.—The term ‘region’ means the Lower Mississippi (as defined in section 4 of the Delta Development

Act (42 U.S.C. 3121 note; Public Law 100–460)). ‘‘(3) FEDERAL GRANT PROGRAM.—The term ‘Federal grant

program’ means a Federal grant program to provide assistance

in— ‘‘(A) acquiring or developing land;

‘‘(B) constructing or equipping a highway, road, bridge,

or facility; or ‘‘(C) carrying out other economic development activities.

‘‘SEC. 382B. DELTA REGIONAL AUTHORITY.

‘‘(a) ESTABLISHMENT.— ‘‘(1) IN GENERAL.—There is established the Delta Regional

Authority. ‘‘(2) COMPOSITION.—The Authority shall be composed of— ‘‘(A) a Federal member, to be appointed by the President, with the advice and consent of the Senate; and ‘‘(B) the Governor (or a designee of the Governor) of

each State in the region that elects to participate in the

Authority.

‘‘(3) COCHAIRPERSONS.—The Authority shall be headed by— ‘‘(A) the Federal member, who shall serve— ‘‘(i) as the Federal cochairperson; and

‘‘(ii) as a liaison between the Federal Government

and the Authority; and

114 STAT. 2763A–270 PUBLIC LAW 106–554—APPENDIX D

‘‘(B) a State cochairperson, who— ‘‘(i) shall be a Governor of a participating State

in the region; and ‘‘(ii) shall be elected by the State members for

a term of not less than 1 year.

‘‘(b) ALTERNATE MEMBERS.— ‘‘(1) STATE ALTERNATES.—The State member of a participating State may have a single alternate, who shall be— ‘‘(A) a resident of that State; and

‘‘(B) appointed by the Governor of the State. ‘‘(2) ALTERNATE FEDERAL COCHAIRPERSON.—The President

shall appoint an alternate Federal cochairperson. ‘‘(3) QUORUM.—A State alternate shall not be counted

toward the establishment of a quorum of the Authority in

any instance in which a quorum of the State members is

required to be present. ‘‘(4) DELEGATION OF POWER.—No power or responsibility

of the Authority specified in paragraphs (2) and (3) of subsection

(c), and no voting right of any Authority member, shall be

delegated to any person—

‘‘(A) who is not an Authority member; or

‘‘(B) who is not entitled to vote in Authority meetings.

‘‘(c) VOTING.—

‘‘(1) IN GENERAL.—A decision by the Authority shall require

a majority vote of the Authority (not including any member

representing a State that is delinquent under subsection

(g)(2)(C)) to be effective.

‘‘(2) QUORUM.—A quorum of State members shall be

required to be present for the Authority to make any policy

decision, including—

‘‘(A) a modification or revision of an Authority policy

decision;

‘‘(B) approval of a State or regional development plan;

and

‘‘(C) any allocation of funds among the States. ‘‘(3) PROJECT AND GRANT PROPOSALS.—The approval of

project and grant proposals shall be—

‘‘(A) a responsibility of the Authority; and

‘‘(B) conducted in accordance with section 382I.

‘‘(4) VOTING BY ALTERNATE MEMBERS.—An alternate member shall vote in the case of the absence, death, disability,

removal, or resignation of the Federal or State representative

for which the alternate member is an alternate.

‘‘(d) DUTIES.—The Authority shall—

‘‘(1) develop, on a continuing basis, comprehensive and

coordinated plans and programs to establish priorities and

approve grants for the economic development of the region,

giving due consideration to other Federal, State, and local

planning and development activities in the region;

‘‘(2) not later than 220 days after the date of enactment

of this subtitle, establish priorities in a development plan for

the region (including 5-year regional outcome targets);

‘‘(3) assess the needs and assets of the region based on

available research, demonstrations, investigations, assessments, and evaluations of the region prepared by Federal,

State, and local agencies, universities, local development districts, and other nonprofit groups;

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–271

‘‘(4) formulate and recommend to the Governors and legislatures of States that participate in the Authority forms of interstate cooperation; ‘‘(5) work with State and local agencies in developing appropriate model legislation;

‘‘(6)(A) enhance the capacity of, and provide support for,

local development districts in the region; or

‘‘(B) if no local development district exists in an area in

a participating State in the region, foster the creation of a

local development district;

‘‘(7) encourage private investment in industrial, commercial, and other economic development projects in the region;

and

‘‘(8) cooperate with and assist State governments with economic development programs of participating States.

‘‘(e) ADMINISTRATION.—In carrying out subsection (d), the

Authority may— ‘‘(1) hold such hearings, sit and act at such times and

places, take such testimony, receive such evidence, and print

or otherwise reproduce and distribute a description of the

proceedings and reports on actions by the Authority as the

Authority considers appropriate; ‘‘(2) authorize, through the Federal or State cochairperson

or any other member of the Authority designated by the Authority, the administration of oaths if the Authority determines

that testimony should be taken or evidence received under

oath;

‘‘(3) request from any Federal, State, or local department

or agency such information as may be available to or procurable

by the department or agency that may be of use to the Authority

in carrying out duties of the Authority;

‘‘(4) adopt, amend, and repeal bylaws and rules governing

the conduct of Authority business and the performance of

Authority duties;

‘‘(5) request the head of any Federal department or agency

to detail to the Authority such personnel as the Authority

requires to carry out duties of the Authority, each such detail

to be without loss of seniority, pay, or other employee status;

‘‘(6) request the head of any State department or agency

or local government to detail to the Authority such personnel

as the Authority requires to carry out duties of the Authority,

each such detail to be without loss of seniority, pay, or other

employee status;

‘‘(7) provide for coverage of Authority employees in a suitable retirement and employee benefit system by—

‘‘(A) making arrangements or entering into contracts

with any participating State government; or

‘‘(B) otherwise providing retirement and other

employee benefit coverage;

‘‘(8) accept, use, and dispose of gifts or donations of services

or real, personal, tangible, or intangible property;

‘‘(9) enter into and perform such contracts, leases, cooperative agreements, or other transactions as are necessary to carry

out Authority duties, including any contracts, leases, or cooperative agreements with—

‘‘(A) any department, agency, or instrumentality of the

United States;

114 STAT. 2763A–272 PUBLIC LAW 106–554—APPENDIX D

‘‘(B) any State (including a political subdivision,

agency, or instrumentality of the State); or

‘‘(C) any person, firm, association, or corporation; and

‘‘(10) establish and maintain a central office and field offices

at such locations as the Authority may select.

‘‘(f ) FEDERAL AGENCY COOPERATION.—A Federal agency shall—

‘‘(1) cooperate with the Authority; and

‘‘(2) provide, on request of the Federal cochairperson, appropriate assistance in carrying out this subtitle, in accordance

with applicable Federal laws (including regulations).

‘‘(g) ADMINISTRATIVE EXPENSES.—

‘‘(1) IN GENERAL.—Administrative expenses of the Authority

(except for the expenses of the Federal cochairperson, including

expenses of the alternate and staff of the Federal cochairperson,

which shall be paid solely by the Federal Government) shall

be paid—

‘‘(A) by the Federal Government, in an amount equal

to 50 percent of the administrative expenses; and

‘‘(B) by the States in the region participating in the

Authority, in an amount equal to 50 percent of the administrative expenses.

‘‘(2) STATE SHARE.—

‘‘(A) IN GENERAL.—The share of administrative

expenses of the Authority to be paid by each State shall

be determined by the Authority.

‘‘(B) NO FEDERAL PARTICIPATION.—The Federal cochairperson shall not participate or vote in any decision under

subparagraph (A).

‘‘(C) DELINQUENT STATES.—If a State is delinquent in

payment of the State’s share of administrative expenses

of the Authority under this subsection—

‘‘(i) no assistance under this subtitle shall be furnished to the State (including assistance to a political

subdivision or a resident of the State); and

‘‘(ii) no member of the Authority from the State

shall participate or vote in any action by the Authority.

‘‘(h) COMPENSATION.—

‘‘(1) FEDERAL COCHAIRPERSON.—The Federal cochairperson

shall be compensated by the Federal Government at level III

of the Executive Schedule in subchapter II of chapter 53 of

title 5, United States Code.

‘‘(2) ALTERNATE FEDERAL COCHAIRPERSON.—The alternate

Federal cochairperson—

‘‘(A) shall be compensated by the Federal Government

at level V of the Executive Schedule described in paragraph

(1); and

‘‘(B) when not actively serving as an alternate for the

Federal cochairperson, shall perform such functions and

duties as are delegated by the Federal cochairperson.

‘‘(3) STATE MEMBERS AND ALTERNATES.—

‘‘(A) IN GENERAL.—A State shall compensate each member and alternate representing the State on the Authority

at the rate established by law of the State.

‘‘(B) NO ADDITIONAL COMPENSATION.—No State member

or alternate member shall receive any salary, or any contribution to or supplementation of salary from any source

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–273

other than the State for services provided by the member

or alternate to the Authority.

‘‘(4) DETAILED EMPLOYEES.—

‘‘(A) IN GENERAL.—No person detailed to serve the

Authority under subsection (e)(6) shall receive any salary

or any contribution to or supplementation of salary for

services provided to the Authority from— ‘‘(i) any source other than the State, local, or intergovernmental department or agency from which the

person was detailed; or ‘‘(ii) the Authority. ‘‘(B) VIOLATION.—Any person that violates this para- graph shall be fined not more than $5,000, imprisoned

not more than 1 year, or both. ‘‘(C) APPLICABLE LAW.—The Federal cochairperson, the

alternate Federal cochairperson, and any Federal officer

or employee detailed to duty on the Authority under subsection (e)(5) shall not be subject to subparagraph (A),

but shall remain subject to sections 202 through 209 of

title 18, United States Code.

‘‘(5) ADDITIONAL PERSONNEL.—

‘‘(A) COMPENSATION.—

‘‘(i) IN GENERAL.—The Authority may appoint and

fix the compensation of an executive director and such

other personnel as are necessary to enable the Authority to carry out the duties of the Authority.

‘‘(ii) EXCEPTION.—Compensation under clause (i)

shall not exceed the maximum rate for the Senior

Executive Service under section 5382 of title 5, United

States Code, including any applicable locality-based

comparability payment that may be authorized under

section 5304(h)(2)(C) of that title.

‘‘(B) EXECUTIVE DIRECTOR.—The executive director

shall be responsible for—

‘‘(i) the carrying out of the administrative duties

of the Authority;

‘‘(ii) direction of the Authority staff; and

‘‘(iii) such other duties as the Authority may

assign.

‘‘(C) NO FEDERAL EMPLOYEE STATUS.—No member,

alternate, officer, or employee of the Authority (except the

Federal cochairperson of the Authority, the alternate and

staff for the Federal cochairperson, and any Federal

employee detailed to the Authority under subsection (e)(5))

shall be considered to be a Federal employee for any purpose.

‘‘(i) CONFLICTS OF INTEREST.—

‘‘(1) IN GENERAL.—Except as provided under paragraph

(2), no State member, alternate, officer, or employee of the

Authority shall participate personally and substantially as a

member, alternate, officer, or employee of the Authority,

through decision, approval, disapproval, recommendation, the

rendering of advice, investigation, or otherwise, in any proceeding, application, request for a ruling or other determination,

contract, claim, controversy, or other matter in which, to knowledge of the member, alternate, officer, or employee—

‘‘(A) the member, alternate, officer, or employee;

114 STAT. 2763A–274 PUBLIC LAW 106–554—APPENDIX D

‘‘(B) the spouse, minor child, partner, or organization

(other than a State or political subdivision of the State)

of the member, alternate, officer, or employee, in which

the member, alternate, officer, or employee is serving as

officer, director, trustee, partner, or employee; or

‘‘(C) any person or organization with whom the member, alternate, officer, or employee is negotiating or has

any arrangement concerning prospective employment;

has a financial interest.

‘‘(2) DISCLOSURE.—Paragraph (1) shall not apply if the

State member, alternate, officer, or employee—

‘‘(A) immediately advises the Authority of the nature

and circumstances of the proceeding, application, request

for a ruling or other determination, contract, claim, controversy, or other particular matter presenting a potential

conflict of interest;

‘‘(B) makes full disclosure of the financial interest;

and

‘‘(C) before the proceeding concerning the matter

presenting the conflict of interest, receives a written determination by the Authority that the interest is not so

substantial as to be likely to affect the integrity of the

services that the Authority may expect from the State

member, alternate, officer, or employee.

‘‘(3) VIOLATION.—Any person that violates this subsection

shall be fined not more than $10,000, imprisoned not more

than 2 years, or both.

‘‘( j) VALIDITY OF CONTRACTS, LOANS, AND GRANTS.—The

Authority may declare void any contract, loan, or grant of or by

the Authority in relation to which the Authority determines that

there has been a violation of any provision under subsection (h)(4),

subsection (i), or sections 202 through 209 of title 18, United States

Code.

‘‘SEC. 382C. ECONOMIC AND COMMUNITY DEVELOPMENT GRANTS.

‘‘(a) IN GENERAL.—The Authority may approve grants to States

and public and nonprofit entities for projects, approved in accordance with section 382I—

‘‘(1) to develop the transportation infrastructure of the

region for the purpose of facilitating economic development

in the region (except that grants for this purpose may only

be made to a State or local government);

‘‘(2) to assist the region in obtaining the job training,

employment-related education, and business development (with

an emphasis on entrepreneurship) that are needed to build

and maintain strong local economies;

‘‘(3) to provide assistance to severely distressed and underdeveloped areas that lack financial resources for improving

basic public services;

‘‘(4) to provide assistance to severely distressed and underdeveloped areas that lack financial resources for equipping

industrial parks and related facilities; and

‘‘(5) to otherwise achieve the purposes of this subtitle.

‘‘(b) FUNDING.—

‘‘(1) IN GENERAL.—Funds for grants under subsection (a)

may be provided—

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–275

‘‘(A) entirely from appropriations to carry out this section;

‘‘(B) in combination with funds available under another

Federal or Federal grant program; or

‘‘(C) from any other source.

‘‘(2) PRIORITY OF FUNDING.—To best build the foundations

for long-term economic development and to complement other

Federal and State resources in the region, Federal funds available under this subtitle shall be focused on the activities in

the following order or priority:

‘‘(A) Basic public infrastructure in distressed counties

and isolated areas of distress.

‘‘(B) Transportation infrastructure for the purpose of

facilitating economic development in the region.

‘‘(C) Business development, with emphasis on

entrepreneurship.

‘‘(D) Job training or employment-related education,

with emphasis on use of existing public educational institutions located in the region.

‘‘(3) FEDERAL SHARE IN GRANT PROGRAMS.—Notwithstanding any provision of law limiting the Federal share in any

grant program, funds appropriated to carry out this section

may be used to increase a Federal share in a grant program,

as the Authority determines appropriate.

‘‘SEC. 382D. SUPPLEMENTS TO FEDERAL GRANT PROGRAMS.

‘‘(a) FINDING.—Congress finds that certain States and local

communities of the region, including local development districts,

may be unable to take maximum advantage of Federal grant programs for which the States and communities are eligible because—

‘‘(1) they lack the economic resources to meet the required

matching share; or

‘‘(2) there are insufficient funds available under the

applicable Federal grant law authorizing the program to meet

pressing needs of the region.

‘‘(b) FEDERAL GRANT PROGRAM FUNDING.—In accordance with

subsection (c), the Federal cochairperson may use amounts made

available to carry out this subtitle, without regard to any limitations

on areas eligible for assistance or authorizations for appropriation

under any other Act, to fund all or any portion of the basic Federal

contribution to a project or activity under a Federal grant program

in the region in an amount that is above the fixed maximum

portion of the cost of the project otherwise authorized by applicable

law, but not to exceed 90 percent of the costs of the project (except

as provided in section 382F(b)).

‘‘(c) CERTIFICATION.—

‘‘(1) IN GENERAL.—In the case of any program or project

for which all or any portion of the basic Federal contribution

to the project under a Federal grant program is proposed to

be made under this section, no Federal contribution shall be

made until the Federal official administering the Federal law

authorizing the contribution certifies that the program or

project—

‘‘(A) meets the applicable requirements of the

applicable Federal grant law; and

114 STAT. 2763A–276 PUBLIC LAW 106–554—APPENDIX D

‘‘(B) could be approved for Federal contribution under

the law if funds were available under the law for the

program or project.

‘‘(2) CERTIFICATION BY AUTHORITY.— ‘‘(A) IN GENERAL.—The certifications and determinations required to be made by the Authority for approval

of projects under this subtitle in accordance with section

382I— ‘‘(i) shall be controlling; and

‘‘(ii) shall be accepted by the Federal agencies. ‘‘(B) ACCEPTANCE BY FEDERAL COCHAIRPERSON.—Any

finding, report, certification, or documentation required to

be submitted to the head of the department, agency, or

instrumentality of the Federal Government responsible for

the administration of any Federal grant program shall

be accepted by the Federal cochairperson with respect to

a supplemental grant for any project under the program.

‘‘SEC. 382E. LOCAL DEVELOPMENT DISTRICTS; CERTIFICATION AND

ADMINISTRATIVE EXPENSES.

‘‘(a) DEFINITION OF LOCAL DEVELOPMENT DISTRICT.—In this

section, the term ‘local development district’ means an entity that—

‘‘(1) is—

‘‘(A) a planning district in existence on the date of

enactment of this subtitle that is recognized by the Economic Development Administration of the Department of

Commerce; or

‘‘(B) where an entity described in subparagraph (A)

does not exist—

‘‘(i) organized and operated in a manner that

ensures broad-based community participation and an

effective opportunity for other nonprofit groups to

contribute to the development and implementation of

programs in the region;

‘‘(ii) governed by a policy board with at least a

simple majority of members consisting of elected officials or employees of a general purpose unit of local

government who have been appointed to represent the

government;

‘‘(iii) certified to the Authority as having a charter

or authority that includes the economic development

of counties or parts of counties or other political subdivisions within the region—

‘‘(I) by the Governor of each State in which

the entity is located; or

‘‘(II) by the State officer designated by the

appropriate State law to make the certification;

and

‘‘(iv)(I) a nonprofit incorporated body organized or chartered under the law of the State in which the entity is

located;

‘‘(II) a nonprofit agency or instrumentality of a State

or local government;

‘‘(III) a public organization established before the date

of enactment of this subtitle under State law for creation

of multi-jurisdictional, area-wide planning organizations;

or

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–277

‘‘(IV) a nonprofit association or combination of bodies,

agencies, and instrumentalities described in subclauses (I)

through (III); and

‘‘(2) has not, as certified by the Federal cochairperson—

‘‘(A) inappropriately used Federal grant funds from

any Federal source; or

‘‘(B) appointed an officer who, during the period in

which another entity inappropriately used Federal grant

funds from any Federal source, was an officer of the other

entity.

‘‘(b) GRANTS TO LOCAL DEVELOPMENT DISTRICTS.—

‘‘(1) IN GENERAL.—The Authority may make grants for

administrative expenses under this section.

‘‘(2) CONDITIONS FOR GRANTS.—

‘‘(A) MAXIMUM AMOUNT.—The amount of any grant

awarded under paragraph (1) shall not exceed 80 percent

of the administrative expenses of the local development

district receiving the grant.

‘‘(B) MAXIMUM PERIOD.—No grant described in paragraph (1) shall be awarded to a State agency certified

as a local development district for a period greater than

3 years.

‘‘(C) LOCAL SHARE.—The contributions of a local

development district for administrative expenses may be

in cash or in kind, fairly evaluated, including space, equipment, and services.

‘‘(c) DUTIES OF LOCAL DEVELOPMENT DISTRICTS.—A local

development district shall—

‘‘(1) operate as a lead organization serving multicounty

areas in the region at the local level; and

‘‘(2) serve as a liaison between State and local governments,

nonprofit organizations (including community-based groups and

educational institutions), the business community, and citizens

that—

‘‘(A) are involved in multijurisdictional planning;

‘‘(B) provide technical assistance to local jurisdictions

and potential grantees; and

‘‘(C) provide leadership and civic development assistance.

‘‘SEC. 382F. DISTRESSED COUNTIES AND AREAS AND NONDISTRESSED

COUNTIES.

‘‘(a) DESIGNATIONS.—Not later than 90 days after the date

of enactment of this subtitle, and annually thereafter, the Authority,

in accordance with such criteria as the Authority may establish,

shall designate—

‘‘(1) as distressed counties, counties in the region that

are the most severely and persistently distressed and underdeveloped and have high rates of poverty or unemployment;

‘‘(2) as nondistressed counties, counties in the region that

are not designated as distressed counties under paragraph (1);

and

‘‘(3) as isolated areas of distress, areas located in nondistressed counties (as designated under paragraph (2)) that have

high rates of poverty or unemployment.

‘‘(b) DISTRESSED COUNTIES.—

114 STAT. 2763A–278 PUBLIC LAW 106–554—APPENDIX D

‘‘(1) IN GENERAL.—The Authority shall allocate at least

75 percent of the appropriations made available under section

382M for programs and projects designed to serve the needs

of distressed counties and isolated areas of distress in the

region.

‘‘(2) FUNDING LIMITATIONS.—The funding limitations under

section 382D(b) shall not apply to a project providing transportation or basic public services to residents of one or more

distressed counties or isolated areas of distress in the region.

‘‘(c) NONDISTRESSED COUNTIES.— ‘‘(1) IN GENERAL.—Except as provided in this subsection,

no funds shall be provided under this subtitle for a project

located in a county designated as a nondistressed county under

subsection (a)(2). ‘‘(2) EXCEPTIONS.— ‘‘(A) IN GENERAL.—The funding prohibition under paragraph (1) shall not apply to grants to fund the administrative expenses of local development districts under section

382E(b). ‘‘(B) MULTICOUNTY PROJECTS.—The Authority may

waive the application of the funding prohibition under paragraph (1) to—

‘‘(i) a multicounty project that includes participation by a nondistressed county; or

‘‘(ii) any other type of project;

if the Authority determines that the project could bring

significant benefits to areas of the region outside a nondistressed county.

‘‘(C) ISOLATED AREAS OF DISTRESS.—For a designation

of an isolated area of distress for assistance to be effective,

the designation shall be supported—

‘‘(i) by the most recent Federal data available;

or

‘‘(ii) if no recent Federal data are available, by

the most recent data available through the government

of the State in which the isolated area of distress

is located.

‘‘(d) TRANSPORTATION AND BASIC PUBLIC INFRASTRUCTURE.—

The Authority shall allocate at least 50 percent of any funds made

available under section 382M for transportation and basic public

infrastructure projects authorized under paragraphs (1) and (3)

of section 382C(a).

‘‘SEC. 382G. DEVELOPMENT PLANNING PROCESS.

‘‘(a) STATE DEVELOPMENT PLAN.—In accordance with policies

established by the Authority, each State member shall submit a

development plan for the area of the region represented by the

State member.

‘‘(b) CONTENT OF PLAN.—A State development plan submitted

under subsection (a) shall reflect the goals, objectives, and priorities

identified in the regional development plan developed under section

382B(d)(2).

‘‘(c) CONSULTATION WITH INTERESTED LOCAL PARTIES.—In

carrying out the development planning process (including the selection of programs and projects for assistance), a State may—

‘‘(1) consult with—

‘‘(A) local development districts; and

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–279

‘‘(B) local units of government; and ‘‘(2) take into consideration the goals, objectives, priorities,

and recommendations of the entities described in paragraph

(1).

‘‘(d) PUBLIC PARTICIPATION.— ‘‘(1) IN GENERAL.—The Authority and applicable State and

local development districts shall encourage and assist, to the

maximum extent practicable, public participation in the

development, revision, and implementation of all plans and

programs under this subtitle. ‘‘(2) REGULATIONS.—The Authority shall develop guidelines

for providing public participation described in paragraph (1),

including public hearings.

‘‘SEC. 382H. PROGRAM DEVELOPMENT CRITERIA.

‘‘(a) IN GENERAL.—In considering programs and projects to

be provided assistance under this subtitle, and in establishing a

priority ranking of the requests for assistance provided by the

Authority, the Authority shall follow procedures that ensure, to

the maximum extent practicable, consideration of— ‘‘(1) the relationship of the project or class of projects to

overall regional development; ‘‘(2) the per capita income and poverty and unemployment

rates in an area; ‘‘(3) the financial resources available to the applicants for

assistance seeking to carry out the project, with emphasis on

ensuring that projects are adequately financed to maximize

the probability of successful economic development; ‘‘(4) the importance of the project or class of projects in

relation to other projects or classes of projects that may be

in competition for the same funds; ‘‘(5) the prospects that the project for which assistance

is sought will improve, on a continuing rather than a temporary

basis, the opportunities for employment, the average level of

income, or the economic development of the area served by

the project; and ‘‘(6) the extent to which the project design provides for

detailed outcome measurements by which grant expenditures

and the results of the expenditures may be evaluated.

‘‘(b) NO RELOCATION ASSISTANCE.—No financial assistance

authorized by this subtitle shall be used to assist a person or

entity in relocating from one area to another, except that financial

assistance may be used as otherwise authorized by this title to

attract businesses from outside the region to the region. ‘‘(c) REDUCTION OF FUNDS.—Funds may be provided for a program or project in a State under this subtitle only if the Authority

determines that the level of Federal or State financial assistance

provided under a law other than this subtitle, for the same type

of program or project in the same area of the State within the

region, will not be reduced as a result of funds made available

by this subtitle.

‘‘SEC. 382I. APPROVAL OF DEVELOPMENT PLANS AND PROJECTS.

‘‘(a) IN GENERAL.—A State or regional development plan or

any multistate subregional plan that is proposed for development

under this subtitle shall be reviewed by the Authority.

‘‘(b) EVALUATION BY STATE MEMBER.—An application for a grant

or any other assistance for a project under this subtitle shall be

114 STAT. 2763A–280 PUBLIC LAW 106–554—APPENDIX D

made through and evaluated for approval by the State member

of the Authority representing the applicant. ‘‘(c) CERTIFICATION.—An application for a grant or other assistance for a project shall be approved only on certification by the

State member that the application for the project— ‘‘(1) describes ways in which the project complies with

any applicable State development plan; ‘‘(2) meets applicable criteria under section 382H;

‘‘(3) provides adequate assurance that the proposed project

will be properly administered, operated, and maintained; and ‘‘(4) otherwise meets the requirements of this subtitle. ‘‘(d) VOTES FOR DECISIONS.—On certification by a State member

of the Authority of an application for a grant or other assistance

for a specific project under this section, an affirmative vote of

the Authority under section 382B(c) shall be required for approval

of the application.

‘‘SEC. 382J. CONSENT OF STATES.

‘‘Nothing in this subtitle requires any State to engage in or

accept any program under this subtitle without the consent of

the State.

‘‘SEC. 382K. RECORDS.

‘‘(a) RECORDS OF THE AUTHORITY.—

‘‘(1) IN GENERAL.—The Authority shall maintain accurate

and complete records of all transactions and activities of the

Authority.

‘‘(2) AVAILABILITY.—All records of the Authority shall be

available for audit and examination by the Comptroller General

of the United States and the Inspector General of the Department of Agriculture (including authorized representatives of

the Comptroller General and the Inspector General of the

Department of Agriculture).

‘‘(b) RECORDS OF RECIPIENTS OF FEDERAL ASSISTANCE.—

‘‘(1) IN GENERAL.—A recipient of Federal funds under this

subtitle shall, as required by the Authority, maintain accurate

and complete records of transactions and activities financed

with Federal funds and report on the transactions and activities

to the Authority.

‘‘(2) AVAILABILITY.—All records required under paragraph

(1) shall be available for audit by the Comptroller General

of the United States, the Inspector General of the Department

of Agriculture, and the Authority (including authorized representatives of the Comptroller General, the Inspector General

of the Department of Agriculture, and the Authority).

‘‘(c) ANNUAL AUDIT.—The Inspector General of the Department

of Agriculture shall audit the activities, transactions, and records

of the Authority on an annual basis.

‘‘SEC. 382L. ANNUAL REPORT.

‘‘Not later than 180 days after the end of each fiscal year,

the Authority shall submit to the President and to Congress a

report describing the activities carried out under this subtitle.

‘‘SEC. 382M. AUTHORIZATION OF APPROPRIATIONS.

‘‘(a) IN GENERAL.—There is authorized to be appropriated to the Authority to carry out this subtitle $30,000,000 for each of

fiscal years 2001 through 2002, to remain available until expended.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–281

‘‘(b) ADMINISTRATIVE EXPENSES.—Not more than 5 percent of

the amount appropriated under subsection (a) for a fiscal year

shall be used for administrative expenses of the Authority.

‘‘SEC. 382N. TERMINATION OF AUTHORITY.

‘‘This subtitle and the authority provided under this subtitle

expire on October 1, 2002.’’.

SEC. 504. AREA COVERED BY LOWER MISSISSIPPI DELTA DEVELOPMENT COMMISSION.

(a) IN GENERAL.—Section 4(2)(D) of the Delta Development

Act (42 U.S.C. 3121 note; 102 Stat. 2246) is amended by inserting

‘‘Natchitoches,’’ after ‘‘Winn,’’.

(b) CONFORMING AMENDMENT.—The matter under the heading

‘‘SALARIES AND EXPENSES’’ under the heading ‘‘FARMERS HOME

ADMINISTRATION’’ in title II of Public Law 100–460 (102 Stat. 2246)

is amended in the fourth proviso by striking ‘‘carry out’’ and all

that follows through ‘‘bills are hereby’’ and inserting ‘‘carry out

S. 2836, the Delta Development Act, as introduced in the Senate

on September 27, 1988, and that bill is’’.

TITLE VI—DAKOTA WATER RESOURCES ACT OF 2000

SEC. 601. SHORT TITLE.

This title may be cited as the ‘‘Dakota Water Resources Act

of 2000’’.

SEC. 602. PURPOSES AND AUTHORIZATION.

Section 1 of Public Law 89–108 (79 Stat. 433; 100 Stat. 418)

is amended—

(1) in subsection (a)—

(A) in paragraph (2), by striking ‘‘of’’ and inserting

‘‘within’’;

(B) in paragraph (5), by striking ‘‘more timely’’ and

inserting ‘‘appropriate’’; and

(C) in paragraph (7), by striking ‘‘federally-assisted

water resource development project providing irrigation for

130,940 acres of land’’ and inserting ‘‘multipurpose federally assisted water resource project providing irrigation,

municipal, rural, and industrial water systems, fish, wildlife, and other natural resource conservation and development, recreation, flood control, ground water recharge, and

augmented stream flows’’;

(2) in subsection (b)—

(A) by inserting ‘‘, jointly with the State of North

Dakota,’’ after ‘‘construct’’;

(B) by striking ‘‘the irrigation of 130,940 acres’’ and

inserting ‘‘irrigation’’;

(C) by striking ‘‘fish and wildlife conservation’’ and

inserting ‘‘fish, wildlife, and other natural resource conservation’’;

(D) by inserting ‘‘augmented stream flows, ground

water recharge,’’ after ‘‘flood control,’’; and

(E) by inserting ‘‘(as modified by the Dakota Water

Resources Act of 2000)’’ before the period at the end;

(3) in subsection (e), by striking ‘‘terminated’’ and all that

follows and inserting ‘‘terminated.’’; and

114 STAT. 2763A–282 PUBLIC LAW 106–554—APPENDIX D

(4) by striking subsections (f ) and (g) and inserting the

following:

‘‘(f ) COSTS.—

‘‘(1) ESTIMATE.—The Secretary shall estimate—

‘‘(A) the actual construction costs of the facilities

(including mitigation facilities) in existence as of the date

of enactment of the Dakota Water Resources Act of 2000;

and

‘‘(B) the annual operation, maintenance, and replacement costs associated with the used and unused capacity

of the features in existence as of that date.

‘‘(2) REPAYMENT CONTRACT.—An appropriate repayment

contract shall be negotiated that provides for the making of

a payment for each payment period in an amount that is

commensurate with the percentage of the total capacity of

the project that is in actual use during the payment period.

‘‘(3) OPERATION AND MAINTENANCE COSTS.—Except as otherwise provided in this Act or Reclamation Law—

‘‘(A) The Secretary shall be responsible for the costs

of operation and maintenance of the proportionate share

of unit facilities in existence on the date of enactment

of the Dakota Water Resources Act of 2000 attributable

to the capacity of the facilities (including mitigation facilities) that remain unused;

‘‘(B) The State of North Dakota shall be responsible

for costs of operation and maintenance of the proportionate

share of existing unit facilities that are used and shall

be responsible for the full costs of operation and maintenance of any facility constructed after the date of enactment

of the Dakota Water Resources Act of 2000; and

‘‘(C) The State of North Dakota shall be responsible

for the costs of providing energy to authorized unit facilities.

‘‘(g) AGREEMENT BETWEEN THE SECRETARY AND THE STATE.—

The Secretary shall enter into one or more agreements with the

State of North Dakota to carry out this Act, including operation

and maintenance of the completed unit facilities and the design

and construction of authorized new unit facilities by the State.

‘‘(h) BOUNDARY WATERS TREATY OF 1909.—

‘‘(1) DELIVERY OF WATER INTO THE HUDSON BAY BASIN.—

Prior to construction of any water systems authorized under

this Act to deliver Missouri River water into the Hudson Bay

basin, the Secretary, in consultation with the Secretary of State

and the Administrator of the Environmental Protection Agency,

must determine that adequate treatment can be provided to

meet the requirements of the Treaty between the United States

and Great Britain relating to Boundary Waters Between the

United States and Canada, signed at Washington, January

11, 1909 (26 Stat. 2448; TS 548) (commonly known as the

Boundary Waters Treaty of 1909).

‘‘(2) COSTS.—All costs of construction, operation, maintenance, and replacement of water treatment and related facilities

authorized by this Act and attributable to meeting the requirements of the treaty referred to in paragraph (1) shall be nonreimbursable.’’.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–283

SEC. 603. FISH AND WILDLIFE.

Section 2 of Public Law 89–108 (79 Stat. 433; 100 Stat. 419)

is amended— (1) by striking subsections (b), (c), and (d) and inserting

the following:

‘‘(b) FISH AND WILDLIFE COSTS.—All fish and wildlife enhancement costs incurred in connection with waterfowl refuges, waterfowl

production areas, and wildlife conservation areas proposed for Federal or State administration shall be nonreimbursable. ‘‘(c) RECREATION AREAS.— ‘‘(1) COSTS.—If non-Federal public bodies continue to agree

to administer land and water areas approved for recreation

and agree to bear not less than 50 percent of the separable

costs of the unit allocated to recreation and attributable to

those areas and all the costs of operation, maintenance, and

replacement incurred in connection therewith, the remainder

of the separable capital costs so allocated and attributed shall

be nonreimbursable. ‘‘(2) APPROVAL.—The recreation areas shall be approved

by the Secretary in consultation and coordination with the

State of North Dakota.

‘‘(d) NON-FEDERAL SHARE.—The non-Federal share of the separable capital costs of the unit allocated to recreation shall be borne

by non-Federal interests, using the following methods, as the Secretary may determine to be appropriate:

‘‘(1) Services in kind.

‘‘(2) Payment, or provision of lands, interests therein, or

facilities for the unit.

‘‘(3) Repayment, with interest, within 50 years of first

use of unit recreation facilities.’’;

(2) in subsection (e)—

(A) by redesignating paragraphs (1) and (2) as paragraphs (2) and (3), respectively;

(B) by inserting ‘‘(1)’’ after ‘‘(e)’’;

(C) in paragraph (2) (as redesignated by subparagraph

(A))—

(i) in the first sentence—

(I) by striking ‘‘within ten years after initial

unit operation to administer for recreation and

fish and wildlife enhancement’’ and inserting ‘‘to

administer for recreation’’; and

(II) by striking ‘‘which are not included within

Federal waterfowl refuges and waterfowl production areas’’; and

(ii) in the second sentence, by striking ‘‘or fish

and wildlife enhancement’’; and

(D) in the first sentence of paragraph (3) (as redesignated by subparagraph (A))—

(i) by striking ‘‘, within ten years after initial operation of the unit,’’; and

(ii) by striking ‘‘paragraph (1) of this subsection’’

and inserting ‘‘paragraph (2)’’;

(3) in subsection (f ), by striking ‘‘and fish and wildlife

enhancement’’; and

(4) in subsection ( j)—

(A) in paragraph (1), by striking ‘‘prior to the completion of construction of Lonetree Dam and Reservoir’’; and

114 STAT. 2763A–284 PUBLIC LAW 106–554—APPENDIX D

(B) by adding at the end the following: ‘‘(4) TAAYER RESERVOIR.—Taayer Reservoir is deauthorized

as a project feature. The Secretary, acting through the Commissioner of Reclamation, shall acquire (including acquisition

through donation or exchange) up to 5,000 acres in the Kraft

and Pickell Slough areas and to manage the area as a component of the National Wildlife Refuge System giving consideration to the unique wildlife values of the area. In acquiring

the lands which comprise the Kraft and Pickell Slough complex,

the Secretary shall acquire wetlands in the immediate vicinity

which may be hydrologically related and nearby uplands as

may be necessary to provide for proper management of the

complex. The Secretary shall provide for appropriate visitor

access and control at the refuge.

‘‘(5) DEAUTHORIZATION OF LONETREE DAM AND RESERVOIR.— The Lonetree Dam and Reservoir is deauthorized, and the

Secretary shall designate the lands acquired for the former

reservoir site as a wildlife conservation area. The Secretary

shall enter into an agreement with the State of North Dakota

providing for the operation and maintenance of the wildlife

conservation area as an enhancement feature, the costs of

which shall be paid by the Secretary.’’.

SEC. 604. INTEREST CALCULATION.

Section 4 of Public Law 89–108 (100 Stat. 435) is amended

by adding at the end the following: ‘‘Interest during construction

shall be calculated only until such date as the Secretary declares

any particular feature to be substantially complete, regardless of

whether the feature is placed into service.’’.

SEC. 605. IRRIGATION FACILITIES.

Section 5 of Public Law 89–108 (100 Stat. 419) is amended—

(1) by striking ‘‘SEC. 5. (a)(1)’’ and all that follows through

subsection (c) and inserting the following:

‘‘SEC. 5. IRRIGATION FACILITIES.

‘‘(a) IN GENERAL.—

‘‘(1) AUTHORIZED DEVELOPMENT.—In addition to the 5,000-

acre Oakes Test Area in existence on the date of enactment

of the Dakota Water Resources Act of 2000, the Secretary

may develop irrigation in—

‘‘(A) the Turtle Lake service area (13,700 acres);

‘‘(B) the McClusky Canal service area (10,000 acres);

and

‘‘(C) if the investment costs are fully reimbursed without aid to irrigation from the Pick-Sloan Missouri Basin

Program, the New Rockford Canal service area (1,200

acres).

‘‘(2) DEVELOPMENT NOT AUTHORIZED.—None of the irrigation authorized by this section may be developed in the Hudson

Bay/Devils Lake Basin. ‘‘(3) NO EXCESS DEVELOPMENT.—The Secretary shall not

develop irrigation in the service areas described in paragraph

(1) in excess of the acreage specified in that paragraph, except

that the Secretary shall develop up to 28,000 acres of irrigation

in other areas of North Dakota (such as the Elk/Charbonneau,

Mon-Dak, Nesson Valley, Horsehead Flats, and Oliver-Mercer

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–285

areas) that are not located in the Hudson Bay/Devils Lake

drainage basin or James River drainage basin. ‘‘(4) PUMPING POWER.—Irrigation development authorized

by this section shall be considered authorized units of the

Pick-Sloan Missouri Basin Program and eligible to receive

project pumping power. ‘‘(5) PRINCIPAL SUPPLY WORKS.—The Secretary shall maintain the Snake Creek Pumping Plant, New Rockford Canal,

and McClusky Canal features of the principal supply works.

Subject to the provisions of section (8) of this Act, the Secretary

shall select a preferred alternative to implement the Dakota

Water Resources Act of 2000. In making this selection, one

of the alternatives the Secretary shall consider is whether

to connect the principal supply works in existence on the date

of enactment.’’;

(2) by redesignating subsections (d), (e), and (f ) as subsections (b), (c), and (d), respectively;

(3) in the first sentence of subsection (b) (as redesignated

by paragraph (2)), by striking ‘‘(a)(1)’’ and inserting ‘‘(a)’’;

(4) in the first sentence of subsection (c) (as redesignated

by paragraph (2)), by striking ‘‘Lucky Mound (7,700 acres),

Upper Six Mile Creek (7,500 acres)’’ and inserting ‘‘Lucky

Mound (7,700 acres) and Upper Six Mile Creek (7,500 acres),

or such other lands at Fort Berthold of equal acreage as may

be selected by the tribe and approved by the Secretary,’’; and

(5) by adding at the end the following: ‘‘(e) IRRIGATION REPORT TO CONGRESS.—

‘‘(1) IN GENERAL.—The Secretary shall investigate and prepare a detailed report on the undesignated 28,000 acres in

subsection (a)(3) as to costs and benefits for any irrigation

units to be developed under Reclamation law.

‘‘(2) FINDING.—The report shall include a finding on the

economic, financial and engineering feasibility of the proposed

irrigation unit, but shall be limited to the undesignated 28,000

acres.‘‘(3) AUTHORIZATION.—If the Secretary finds that the proposed construction is feasible, such irrigation units are authorized without further Act of Congress.

‘‘(4) DOCUMENTATION.—No expenditure for the construction

of facilities authorized under this section shall be made until

after the Secretary, in cooperation with the State of North

Dakota, has prepared the appropriate documentation in accordance with section 1 and pursuant to the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et seq.) analyzing

the direct and indirect impacts of implementing the report.’’.

SEC. 606. POWER.

Section 6 of Public Law 89–108 (79 Stat. 435; 100 Stat. 421)

is amended—

(1) in subsection (b)—

(A) by striking ‘‘Notwithstanding the provisions of’’ and inserting ‘‘Pursuant to the provisions of’’; and

(B) by striking ‘‘revenues,’’ and all that follows and

inserting ‘‘revenues.’’; and

(2) by striking subsection (c) and inserting the following:

‘‘(c) NO INCREASE IN RATES OR EFFECT ON REPAYMENT METH- ODOLOGY.—In accordance with the last sentence of section 302(a)(3)

114 STAT. 2763A–286 PUBLIC LAW 106–554—APPENDIX D

of the Department of Energy Organization Act (42 U.S.C.

7152(a)(3)), section 1(e) shall not result in any reallocation of project

costs and shall not result in increased rates to Pick-Sloan Missouri

Basin Program customers. Nothing in the Dakota Water Resources

Act of 2000 alters or affects in any way the repayment methodology

in effect as of the date of enactment of that Act for other features

of the Pick-Sloan Missouri Basin Program.’’.

SEC. 607. MUNICIPAL, RURAL, AND INDUSTRIAL WATER SERVICE.

Section 7 of Public Law 89–108 (100 Stat. 422) is amended— (1) in subsection (a)(3)— (A) in the second sentence— (i) by striking ‘‘The non-Federal share’’ and inserting ‘‘Unless otherwise provided in this Act, the nonFederal share’’;

(ii) by striking ‘‘each water system’’ and inserting ‘‘water systems’’;

(iii) by inserting after the second sentence the

following: ‘‘The State may use the Federal and nonFederal funds to provide grants or loans for municipal,

rural, and industrial water systems. The State shall

use the proceeds of repaid loans for municipal, rural,

and industrial water systems. Proceeds from loan

repayments and any interest thereon shall be treated

as Federal funds.’’; and

(iv) by striking the last sentence and inserting

the following: ‘‘The Southwest Pipeline Project, the

Northwest Area Water Supply Project, the Red River

Valley Water Supply Project, and other municipal,

industrial, and rural water systems in the State of

North Dakota shall be eligible for funding under the

terms of this section. Funding provided under this

section for the Red River Valley Water Supply Project

shall be in addition to funding for that project under

section 10(a)(1)(B). The amount of non-Federal contributions made after May 12, 1986, that exceeds the

25 percent requirement shall be credited to the State

for future use in municipal, rural, and industrial

projects under this section.’’; and

(2) by striking subsections (b), (c), and (d) and inserting

the following:

‘‘(b) WATER CONSERVATION PROGRAM.—The State of North

Dakota may use funds provided under subsections (a) and (b)(1)(A)

of section 10 to develop and implement a water conservation program. The Secretary and the State shall jointly establish water

conservation goals to meet the purposes of the State program and

to improve the availability of water supplies to meet the purposes

of this Act. If the State achieves the established water conservation

goals, the non-Federal cost share for future projects under subsection (a)(3) shall be reduced to 24.5 percent.

‘‘(c) NONREIMBURSABILITY OF COSTS.—With respect to the

Southwest Pipeline Project, the Northwest Area Water Supply

Project, the Red River Valley Water Supply Project, and other

municipal, industrial, and rural water systems in North Dakota,

the costs of the features constructed on the Missouri River by

the Secretary of the Army before the date of enactment of the

Dakota Water Resources Act of 2000 shall be nonreimbursable.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–287

‘‘(d) INDIAN MUNICIPAL RURAL AND INDUSTRIAL WATER SUPPLY.—The Secretary shall construct, operate, and maintain such

municipal, rural, and industrial water systems as the Secretary

determines to be necessary to meet the economic, public health,

and environmental needs of the Fort Berthold, Standing Rock,

Turtle Mountain (including the Trenton Indian Service Area), and

Fort Totten Indian Reservations and adjacent areas.’’.

SEC. 608. SPECIFIC FEATURES.

(a) SYKESTON CANAL.—Sykeston Canal is hereby deauthorized.

(b) IN GENERAL.—Public Law 89–108 (100 Stat. 423) is amended

by striking section 8 and inserting the following:

‘‘SEC. 8. SPECIFIC FEATURES.

‘‘(a) RED RIVER VALLEY WATER SUPPLY PROJECT.—

‘‘(1) IN GENERAL.—Subject to the requirements of this section, the Secretary shall construct a feature or features to

provide water to the Sheyenne River water supply and release

facility or such other feature or features as are selected under

subsection (d).

‘‘(2) DESIGN AND CONSTRUCTION.—The feature or features

shall be designed and constructed to meet only the following

water supply requirements as identified in the report prepared

pursuant to subsection (b) of this section: Municipal, rural,

and industrial water supply needs; ground water recharge;

and streamflow augmentation.

‘‘(3) COMMENCEMENT OF CONSTRUCTION.—(A) If the Secretary selects a project feature under this section that would

provide water from the Missouri River or its tributaries to

the Sheyenne River water supply and release facility or from

the Missouri River or its tributaries to such other conveyance

facility as the Secretary selects under this section, no later

than 90 days after the completion of the final environmental

impact statement, the Secretary shall transmit to Congress

a comprehensive report which provides—

‘‘(i) a detailed description of the proposed project feature;

‘‘(ii) a summary of major issues addressed in the

environmental impact statement;

‘‘(iii) likely effects, if any, on other States bordering

the Missouri River and on the State of Minnesota; and

‘‘(iv) a description of how the project feature complies

with the requirements of section 1(h)(1) of this Act (relating

to the Boundary Waters Treaty of 1909).

‘‘(B) No project feature or features that would provide water

from the Missouri River or its tributaries to the Sheyenne

River water supply and release facility or from the Missouri

River or its tributaries to such other conveyance facility as

the Secretary selects under this section shall be constructed

unless such feature is specifically authorized by an Act of

Congress approved subsequent to the Secretary’s transmittal

of the report required in subparagraph (A). If, after complying

with subsections (b) through (d) of this section, the Secretary

selects a feature or features using only in-basin sources of

water to meet the water needs of the Red River Valley identified

in subsection (b), such features are authorized without further

114 STAT. 2763A–288 PUBLIC LAW 106–554—APPENDIX D

Act of Congress. The Act of Congress referred to in this subparagraph must be an authorization bill, and shall not be a bill

making appropriations.

‘‘(C) The Secretary may not commence construction on the

feature until a master repayment contract or water service

agreement consistent with this Act between the Secretary and

the appropriate non-Federal entity has been executed.

‘‘(b) REPORT ON RED RIVER VALLEY WATER NEEDS AND

OPTIONS.—

‘‘(1) IN GENERAL.—The Secretary of the Interior shall conduct a comprehensive study of the water quality and quantity

needs of the Red River Valley in North Dakota and possible

options for meeting those needs.

‘‘(2) NEEDS.—The needs addressed in the report shall

include such needs as—

‘‘(A) municipal, rural, and industrial water supplies;

‘‘(B) water quality;

‘‘(C) aquatic environment;

‘‘(D) recreation; and

‘‘(E) water conservation measures.

‘‘(3) PROCESS.—In conducting the study, the Secretary

through an open and public process shall solicit input from

gubernatorial designees from States that may be affected by

possible options to meet such needs as well as designees from

other Federal agencies with relevant expertise. For any option

that includes an out-of-basin solution, the Secretary shall consider the effect of the option on other States that may be

affected by such option, as well as other appropriate considerations. Upon completion, a draft of the study shall be provided

by the Secretary to such States and Federal agencies. Such

States and agencies shall be given not less than 120 days

to review and comment on the study method, findings and

conclusions leading to any alternative that may have an impact

on such States or on resources subject to such Federal agencies’

jurisdiction. The Secretary shall receive and take into consideration any such comments and produce a final report and transmit the final report to Congress.

‘‘(4) LIMITATION.—No design or construction of any feature

or features that facilitate an out-of-basin transfer from the

Missouri River drainage basin shall be authorized under the

provisions of this subsection.

‘‘(c) ENVIRONMENTAL IMPACT STATEMENT.—

‘‘(1) IN GENERAL.—Nothing in this section shall be construed to supersede any requirements under the National

Environmental Policy Act or the Administrative Procedures

Act.

‘‘(2) DRAFT.—

‘‘(A) DEADLINE.—Pursuant to an agreement between

the Secretary and State of North Dakota as authorized

under section 1(g), not later than 1 year after the date

of enactment of the Dakota Water Resources Act of 2000,

the Secretary and the State of North Dakota shall jointly

prepare and complete a draft environmental impact statement concerning all feasible options to meet the comprehensive water quality and quantity needs of the Red River

Valley and the options for meeting those needs, including

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–289

the delivery of Missouri River water to the Red River

Valley. ‘‘(B) REPORT ON STATUS.—If the Secretary and State

of North Dakota cannot prepare and complete the draft

environmental impact statement within 1 year after the

date of enactment of the Dakota Water Resources Act of

2000, the Secretary, in consultation and coordination with

the State of North Dakota, shall report to Congress on

the status of this activity, including an estimate of the

date of completion.

‘‘(3) FINAL.— ‘‘(A) DEADLINE.—Not later than 1 year after filing the

draft environmental impact statement, a final environmental impact statement shall be prepared and published. ‘‘(B) REPORT ON STATUS.—If the Secretary and State

of North Dakota cannot prepare and complete a final

environmental impact statement within 1 year of the

completion of the draft environmental impact statement,

the Secretary, in consultation and coordination with the

State of North Dakota, shall report to Congress on the

status of this activity, including an estimate of the date

of completion. ‘‘(d) PROCESS FOR SELECTION.—

‘‘(1) IN GENERAL.—After reviewing the final report required

by subsection (b)(1) and complying with subsection (c), the

Secretary, in consultation and coordination with the State of

North Dakota in coordination with affected local communities,

shall select one or more project features described in subsection

(a) that will meet the comprehensive water quality and quantity

needs of the Red River Valley. The Secretary’s selection of

an alternative shall be subject to judicial review.

‘‘(2) AGREEMENTS.—If the Secretary selects an option under

paragraph (1) that uses only in-basin sources of water, not

later than 180 days after the record of decision has been

executed, the Secretary shall enter into a cooperative agreement

with the State of North Dakota to construct the feature or

features selected. If the Secretary selects an option under paragraph (1) that would require a further act of Congress under

the provisions of subsection (a), not later than 180 days after

the date of enactment of legislation required under subsection

(a) the Secretary shall enter into a cooperative agreement with

the State of North Dakota to construct the feature or features

authorized by that legislation.

‘‘(e) SHEYENNE RIVER WATER SUPPLY AND RELEASE OR ALTERNATE FEATURES.—The Secretary shall construct, operate, and maintain a Sheyenne River water supply and release feature (including

a water treatment plant) capable of delivering 100 cubic feet per

second of water or any other amount determined in the reports

under this section, for the cities of Fargo and Grand Forks and

surrounding communities, or such other feature or features as

may be selected under subsection (d). ‘‘(f ) DEVILS LAKE.—No funds authorized under this Act may

be used to carry out the portion of the feasibility study of the

Devils Lake basin, North Dakota, authorized under the Energy

and Water Development Appropriations Act of 1993 (Public Law

102–377), that addresses the needs of the area for stabilized lake

levels through inlet controls, or to otherwise study any facility

114 STAT. 2763A–290 PUBLIC LAW 106–554—APPENDIX D

or carry out any activity that would permit the transfer of water

from the Missouri River drainage basin into Devils Lake, North

Dakota.’’.

SEC. 609. OAKES TEST AREA TITLE TRANSFER.

Public Law 89–108 (100 Stat. 423) is amended by striking

section 9 and inserting the following:

‘‘SEC. 9. OAKES TEST AREA TITLE TRANSFER.

‘‘(a) IN GENERAL.—Not later than 2 years after execution of

a record of decision under section 8(d) on whether to use the

New Rockford Canal as a means of delivering water to the Red

River Basin as described in section 8, the Secretary shall enter

into an agreement with the State of North Dakota, or its designee,

to convey title and all or any rights, interests, and obligations

of the United States in and to the Oakes Test Area as constructed

and operated under Public Law 99–294 (100 Stat. 418) under such

terms and conditions as the Secretary believes would fully protect

the public interest. ‘‘(b) TERMS AND CONDITIONS.—The agreement shall define the

terms and conditions of the transfer of the facilities, lands, mineral

estate, easements, rights-of-way and water rights including the

avoidance of costs that the Federal Government would otherwise

incur in the case of a failure to agree under subsection (d).

‘‘(c) COMPLIANCE.—The action of the Secretary under this section shall comply with all applicable requirements of Federal, State,

and local law.

‘‘(d) FAILURE TO AGREE.—If an agreement is not reached within

the time limit specified in subsection (a), the Secretary shall dispose

of the Oakes Test Area facilities under the Federal Property and

Administrative Services Act of 1949 (40 U.S.C. 471 et seq.).’’.

SEC. 610. AUTHORIZATION OF APPROPRIATIONS.

Section 10 of Public Law 89–108 (100 Stat. 424; 106 Stat.

4669, 4739) is amended—

(1) in subsection (a)— (A) by striking ‘‘(a)(1) There are authorized’’ and inserting the following:

‘‘(a) WATER DISTRIBUTION FEATURES.—

‘‘(1) IN GENERAL.—

‘‘(A) MAIN STEM SUPPLY WORKS.—There is authorized’’;

(B) in paragraph (1)—

(i) in the first sentence, by striking ‘‘$270,395,000

for carrying out the provisions of section 5(a) through

5(c) and section 8(a)(1) of this Act’’ and inserting

‘‘$164,000,000 to carry out section 5(a)’’;

(ii) by inserting after subparagraph (A) (as designated by clause (i)) the following:

‘‘(B) RED RIVER VALLEY WATER SUPPLY PROJECT.—There

is authorized to be appropriated to carry out section 8(a)(1)

$200,000,000.’’; and

(iii) by striking ‘‘Such sums’’ and inserting the

following:

‘‘(C) AVAILABILITY.—Such sums’’; and

(C) in paragraph (2)—

(i) by striking ‘‘(2) There is’’ and inserting the

following:

‘‘(2) INDIAN IRRIGATION.—

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–291

‘‘(A) IN GENERAL.—There is’’;

(ii) by striking ‘‘for carrying out section 5(e) of

this Act’’ and inserting ‘‘to carry out section 5(c)’’; and

(iii) by striking ‘‘Such sums’’ and inserting the

following:

‘‘(B) AVAILABILITY.—Such sums’’;

(2) in subsection (b)— (A) by striking ‘‘(b)(1) There is’’ and inserting the following: ‘‘(b) MUNICIPAL, RURAL, AND INDUSTRIAL WATER SUPPLY.— ‘‘(1) STATEWIDE.— ‘‘(A) INITIAL AMOUNT.—There is’’;

(B) in paragraph (1)— (i) by inserting before ‘‘Such sums’’ the following: ‘‘(B) ADDITIONAL AMOUNT.—In addition to the amount

under subparagraph (A), there is authorized to be appropriated to carry out section 7(a) $200,000,000.’’; and

(ii) by striking ‘‘Such sums’’ and inserting the following:

‘‘(C) AVAILABILITY.—Such sums’’; and

(C) in paragraph (2)—

(i) by striking ‘‘(2) There are authorized to be

appropriated $61,000,000’’ and all that follows through

‘‘Act.’’ and inserting the following:

‘‘(2) INDIAN MUNICIPAL, RURAL, AND INDUSTRIAL AND OTHER

DELIVERY FEATURES.—

‘‘(A) INITIAL AMOUNT.—There is authorized to be

appropriated—

‘‘(i) to carry out section 8(a)(1), $40,500,000; and

‘‘(ii) to carry out section 7(d), $20,500,000.’’;

(ii) by inserting before ‘‘Such sums’’ the following:

‘‘(B) ADDITIONAL AMOUNT.—

‘‘(i) IN GENERAL.—In addition to the amount under

subparagraph (A), there is authorized to be appropriated to carry out section 7(d) $200,000,000. ‘‘(ii) ALLOCATION.—The amount under clause (i)

shall be allocated as follows:

‘‘(I) $30,000,000 to the Fort Totten Indian Reservation.

‘‘(II) $70,000,000 to the Fort Berthold Indian

Reservation.

‘‘(IV) $80,000,000 to the Standing Rock Indian

Reservation.

‘‘(V) $20,000,000 to the Turtle Mountain

Indian Reservation.’’; and

(iii) by striking ‘‘Such sums’’ and inserting the

following:

‘‘(C) AVAILABILITY.—Such sums’’;

(3) in subsection (c)—

(A) by striking ‘‘(c) There is’’ and inserting the following: ‘‘(c) RESOURCES TRUST AND OTHER PROVISIONS.—

‘‘(1) INITIAL AMOUNT.—There is’’; and

(B) by striking the second and third sentences and

inserting the following:

‘‘(2) ADDITIONAL AMOUNT.—In addition to amount under

paragraph (1), there are authorized to be appropriated—

114 STAT. 2763A–292 PUBLIC LAW 106–554—APPENDIX D

‘‘(A) $6,500,000 to carry out recreational projects; and

‘‘(B) an additional $25,000,000 to carry out section

11;

to remain available until expended.

‘‘(3) RECREATIONAL PROJECTS.—Of the funds authorized

under paragraph (2) for recreational projects, up to $1,500,000

may be used to fund a wetland interpretive center in the

State of North Dakota. ‘‘(4) OPERATION AND MAINTENANCE.— ‘‘(A) IN GENERAL.—There are authorized to be appropriated such sums as are necessary for operation and

maintenance of the unit (including the mitigation and

enhancement features). ‘‘(B) AUTHORIZATION LIMITS.—Expenditures for operation and maintenance of features substantially completed

and features constructed before the date of enactment of

the Dakota Water Resources Act of 2000, including funds

expended for such purposes since the date of enactment

of Public Law 99–294, shall not be counted against the

authorization limits in this section.

‘‘(5) MITIGATION AND ENHANCEMENT LAND.—On or about

the date on which the features authorized by section 8(a) are

operational, a separate account in the Natural Resources Trust

authorized by section 11 shall be established for operation

and maintenance of the mitigation and enhancement land associated with the unit.’’; and

(4) by striking subsection (e) and inserting the following:

‘‘(e) INDEXING.—The $200,000,000 amount under subsection

(b)(1)(B), the $200,000,000 amount under subsection (a)(1)(B), and

the funds authorized under subsection (b)(2) shall be indexed as

necessary to allow for ordinary fluctuations of construction costs

incurred after the date of enactment of the Dakota Water Resources

Act of 2000 as indicated by engineering cost indices applicable

for the type of construction involved. All other authorized cost

ceilings shall remain unchanged.’’.

SEC. 611. NATURAL RESOURCES TRUST.

Section 11 of Public Law 89–108 (100 Stat. 424) is amended—

(1) by striking subsection (a) and inserting the following:

‘‘(a) CONTRIBUTION.—

‘‘(1) INITIAL AUTHORIZATION.—

‘‘(A) IN GENERAL.—From the sums appropriated under

section 10 for the Garrison Diversion Unit, the Secretary

shall make an annual Federal contribution to a Natural

Resources Trust established by non-Federal interests in

accordance with subsection (b) and operated in accordance

with subsection (c).

‘‘(B) AMOUNT.—The total amount of Federal contributions under subparagraph (A) shall not exceed $12,000,000.

‘‘(2) ADDITIONAL AUTHORIZATION.—

‘‘(A) IN GENERAL.—In addition to the amount authorized in paragraph (1), the Secretary shall make annual

Federal contributions to the Natural Resources Trust until

the amount authorized by section 10(c)(2)(B) is reached,

in the manner stated in subparagraph (B).

‘‘(B) ANNUAL AMOUNT.—The amount of the contribution

under subparagraph (A) for each fiscal year shall be the

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–293

amount that is equal to 5 percent of the total amount

that is appropriated for the fiscal year under subsections

(a)(1)(B) and (b)(1)(B) of section 10.’’. (2) in subsection (b), by striking ‘‘Wetlands Trust’’ and

inserting ‘‘Natural Resources Trust’’; and

(3) in subsection (c)—

(A) by striking ‘‘Wetland Trust’’ and inserting ‘‘Natural

Resources Trust’’;

(B) by striking ‘‘are met’’ and inserting ‘‘is met’’;

(C) in paragraph (1), by inserting ‘‘, grassland conservation and riparian areas’’ after ‘‘habitat’’; and

(D) in paragraph (2), by adding at the end the following:

‘‘(C) The power to fund incentives for conservation

practices by landowners.’’.

TITLE VII

SEC. 701. FINDINGS.

Congress finds that—

(1) there is a continuing need for reconciliation between

Indians and non-Indians;

(2) the need may be met partially through the promotion

of the understanding of the history and culture of Sioux Indian

tribes;

(3) the establishment of a Sioux Nation Tribal Supreme

Court will promote economic development on reservations of

the Sioux Nation and provide investors that contribute to that

development a greater degree of certainty and confidence by—

(A) reconciling conflicting tribal laws; and

(B) strengthening tribal court systems;

(4) the reservations of the Sioux Nation—

(A) contain the poorest counties in the United States;

and

(B) lack adequate tools to promote economic development and the creation of jobs;

(5) the establishment of a Native American Economic

Development Council will assist in promoting economic growth

and reducing poverty on reservations of the Sioux Nation by—

(A) coordinating economic development efforts;

(B) centralizing expertise concerning Federal assistance; and

(C) facilitating the raising of funds from private donations to meet matching requirements under certain Federal

assistance programs;

(6) there is a need to enhance and strengthen the capacity

of Indian tribal governments and tribal justice systems to

address conflicts which impair relationships within Indian

communities and between Indian and non-Indian communities

and individuals; and

(7) the establishment of the National Native American

Mediation Training Center, with the technical assistance of

tribal and Federal agencies, including the Community Relations

Service of the Department of Justice, would enhance and

strengthen the mediation skills that are useful in reducing

tensions and resolving conflicts in Indian communities and

between Indian and non-Indian communities and individuals.

114 STAT. 2763A–294 PUBLIC LAW 106–554—APPENDIX D

SEC. 702. DEFINITIONS.

In this title:

(1) INDIAN TRIBE.—The term ‘‘Indian tribe’’ has the meaning

given that term in section 4(e) of the Indian Self-Determination

and Education Assistance Act (25 U.S.C. 450b(e)).

(2) SECRETARY.—The term ‘‘Secretary’’ means the Secretary

of the Interior.

(3) SIOUX NATION.—The term ‘‘Sioux Nation’’ means the

Indian tribes comprising the Sioux Nation.

SEC. 703. RECONCILIATION CENTER.

(a) ESTABLISHMENT.—The Secretary of Housing and Urban

Development, in cooperation with the Secretary, shall establish,

in accordance with this section, a reconciliation center, to be known

as ‘‘Reconciliation Place’’.

(b) LOCATION.—Notwithstanding any other provision of law,

the Secretary shall take into trust for the benefit of the Sioux

Nation the parcel of land in Stanley County, South Dakota, that

is described as ‘‘The Reconciliation Place Addition’’ that is owned

on the date of enactment of this Act by the Wakpa Sica Historical

Society, Inc., for the purpose of establishing and operating The

Reconciliation Place.

(c) PURPOSES.—The purposes of Reconciliation Place shall be

as follows:

(1) To enhance the knowledge and understanding of the

history of Native Americans by—

(A) displaying and interpreting the history, art, and

culture of Indian tribes for Indians and non-Indians; and

(B) providing an accessible repository for—

(i) the history of Indian tribes; and

(ii) the family history of members of Indian tribes.

(2) To provide for the interpretation of the encounters

between Lewis and Clark and the Sioux Nation.

(3) To house the Sioux Nation Tribal Supreme Court.

(4) To house the Native American Economic Development

Council.

(5) To house the National Native American Mediation

Training Center to train tribal personnel in conflict resolution

and alternative dispute resolution.

(d) GRANT.—

(1) IN GENERAL.—The Secretary of Housing and Urban

Development shall offer to award a grant to the Wakpa Sica

Historical Society of Fort Pierre, South Dakota, for the construction of Reconciliation Place.

(2) GRANT AGREEMENT.—

(A) IN GENERAL.—As a condition to receiving the grant

under this subsection, the appropriate official of the Wakpa

Sica Historical Society shall enter into a grant agreement

with the Secretary of Housing and Urban Development.

(B) CONSULTATION.—Before entering into a grant

agreement under this paragraph, the Secretary of Housing

and Urban Development shall consult with the Secretary

concerning the contents of the agreement.

(C) DUTIES OF THE WAKPA SICA HISTORICAL SOCIETY.—

The grant agreement under this paragraph shall specify

the duties of the Wakpa Sica Historical Society under this

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–295

section and arrangements for the maintenance of Reconciliation Place.

(3) AUTHORIZATION OF APPROPRIATIONS.—There are authorized to be appropriated to the Department of Housing and

Urban Development $18,258,441, to be used for the grant under

this section.

SEC. 704. SIOUX NATION SUPREME COURT AND NATIONAL NATIVE

AMERICAN MEDIATION TRAINING CENTER.

(a) IN GENERAL.—To ensure the development and operation

of the Sioux Nation Tribal Supreme Court and the National Native

American Mediation Training Center, the Attorney General of the

United States shall use available funds to provide technical and

financial assistance to the Sioux Nation.

(b) AUTHORIZATION OF APPROPRIATIONS.—To carry out this section, there are authorized to be appropriated to the Department

of Justice such sums as are necessary.

TITLE VIII—ERIE CANALWAY NATIONAL HERITAGE

CORRIDOR

SEC. 801. SHORT TITLE; DEFINITIONS.

(a) SHORT TITLE.—This title may be cited as the ‘‘Erie Canalway

National Heritage Corridor Act’’.

(b) DEFINITIONS.—For the purposes of this title, the following

definitions shall apply:

(1) ERIE CANALWAY.—The term ‘‘Erie Canalway’’ means

the 524 miles of navigable canal that comprise the New York

State Canal System, including the Erie, Cayuga and Seneca,

Oswego, and Champlain Canals and the historic alignments

of these canals, including the cities of Albany and Buffalo.

(2) CANALWAY PLAN.—The term ‘‘Canalway Plan’’ means

the comprehensive preservation and management plan for the

Corridor required under section 806.

(3) COMMISSION.—The term ‘‘Commission’’ means the Erie

Canalway National Heritage Corridor Commission established

under section 804.

(4) CORRIDOR.—The term ‘‘Corridor’’ means the Erie

Canalway National Heritage Corridor established under section

803.

(5) GOVERNOR.—The term ‘‘Governor’’ means the Governor

of the State of New York.

(6) SECRETARY.—The term ‘‘Secretary’’ means the Secretary

of the Interior.

SEC. 802. FINDINGS AND PURPOSES.

(a) FINDINGS.—Congress finds that—

(1) the year 2000 marks the 175th Anniversary of New

York State’s creation and stewardship of the Erie Canalway

for commerce, transportation, and recreational purposes,

establishing the network which made New York the ‘‘Empire

State’’ and the Nation’s premier commercial and financial center;

(2) the canals and adjacent areas that comprise the Erie

Canalway are a nationally significant resource of historic and

recreational value, which merit Federal recognition and assistance;

114 STAT. 2763A–296 PUBLIC LAW 106–554—APPENDIX D

(3) the Erie Canalway was instrumental in the establishment of strong political and cultural ties between New England,

upstate New York, and the old Northwest and facilitated the

movement of ideas and people ensuring that social reforms

like the abolition of slavery and the women’s rights movement

spread across upstate New York to the rest of the country;

(4) the construction of the Erie Canalway was considered

a supreme engineering feat, and most American canals were

modeled after New York State’s canal;

(5) at the time of construction, the Erie Canalway was

the largest public works project ever undertaken by a State,

resulting in the creation of critical transportation and commercial routes to transport passengers and goods;

(6) the Erie Canalway played a key role in turning New

York City into a major port and New York State into the

preeminent center for commerce, industry, and finance in North

America and provided a permanent commercial link between

the Port of New York and the cities of eastern Canada, a

cornerstone of the peaceful relationship between the two countries;

(7) the Erie Canalway proved the depth and force of American ingenuity, solidified a national identity, and found an

enduring place in American legend, song, and art;

(8) there is national interest in the preservation and

interpretation of the Erie Canalway’s important historical,

natural, cultural, and scenic resources; and

(9) partnerships among Federal, State, and local governments and their regional entities, nonprofit organizations, and

the private sector offer the most effective opportunities for

the preservation and interpretation of the Erie Canalway.

(b) PURPOSES.—The purposes of this title are—

(1) to designate the Erie Canalway National Heritage Corridor;

(2) to provide for and assist in the identification, preservation, promotion, maintenance, and interpretation of the historical, natural, cultural, scenic, and recreational resources of the

Erie Canalway in ways that reflect its national significance

for the benefit of current and future generations;

(3) to promote and provide access to the Erie Canalway’s

historical, natural, cultural, scenic, and recreational resources;

(4) to provide a framework to assist the State of New

York, its units of local government, and the communities within

the Erie Canalway in the development of integrated cultural,

historical, recreational, economic, and community development

programs in order to enhance and interpret the unique and

nationally significant resources of the Erie Canalway; and

(5) to authorize Federal financial and technical assistance

to the Commission to serve these purposes for the benefit

of the people of the State of New York and the Nation.

SEC. 803. THE ERIE CANALWAY NATIONAL HERITAGE CORRIDOR.

(a) ESTABLISHMENT.—To carry out the purposes of this title

there is established the Erie Canalway National Heritage Corridor

in the State of New York.

(b) BOUNDARIES.—The boundaries of the Corridor shall include

those lands generally depicted on a map entitled ‘‘Erie Canalway

National Heritage Area’’ numbered ERIE/80,000 and dated October

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–297

2000. This map shall be on file and available for public inspection

in the appropriate office of the National Park Service, the office

of the Commission, and the office of the New York State Canal

Corporation in Albany, New York.

(c) OWNERSHIP AND OPERATION OF THE NEW YORK STATE CANAL

SYSTEM.—The New York State Canal System shall continue to

be owned, operated, and managed by the State of New York.

SEC. 804. THE ERIE CANALWAY NATIONAL HERITAGE CORRIDOR

COMMISSION.

(a) ESTABLISHMENT.—There is established the Erie Canalway

National Heritage Corridor Commission. The purpose of the

Commission shall be— (1) to work with Federal, State, and local authorities to

develop and implement the Canalway Plan; and

(2) to foster the integration of canal-related historical, cultural, recreational, scenic, economic, and community development initiatives within the Corridor.

(b) MEMBERSHIP.—The Commission shall be composed of 27

members as follows:

(1) The Secretary of the Interior, ex officio or the Secretary’s

designee.

(2) Seven members, appointed by the Secretary after consideration of recommendations submitted by the Governor and

other appropriate officials, with knowledge and experience of

the following agencies or those agencies’ successors: The New

York State Secretary of State, the New York State Department

of Environment Conservation, the New York State Office of

Parks, Recreation and Historic Preservation, the New York

State Department of Agriculture and Markets, the New York

State Department of Transportation, and the New York State

Canal Corporation, and the Empire State Development Corporation.

(3) The remaining 19 members who reside within the Corridor and are geographically dispersed throughout the Corridor

shall be from local governments and the private sector with

knowledge of tourism, economic and community development,

regional planning, historic preservation, cultural or natural

resource management, conservation, recreation, and education

or museum services. These members will be appointed by the

Secretary as follows:

(A) Eleven members based on a recommendation from

each member of the United States House of Representatives

whose district shall encompass the Corridor. Each shall

be a resident of the district from which they shall be

recommended.

(B) Two members based on a recommendation from

each United States Senator from New York State.

(C) Six members who shall be residents of any county

constituting the Corridor. One such member shall have

knowledge and experience of the Canal Recreationway

Commission.

(c) APPOINTMENTS AND VACANCIES.—Members of the Commission other than ex officio members shall be appointed for terms

of 3 years. Of the original appointments, six shall be for a term

of 1 year, six shall be for a term of 2 years, and seven shall

be for a term of 3 years. Any member of the Commission appointed

114 STAT. 2763A–298 PUBLIC LAW 106–554—APPENDIX D

for a definite term may serve after expiration of the term until

the successor of the member is appointed. Any member appointed

to fill a vacancy shall serve for the remainder of the term for

which the predecessor was appointed. Any vacancy on the Commission shall be filled in the same manner in which the original

appointment was made.

(d) COMPENSATION.—Members of the Commission shall receive

no compensation for their service on the Commission. Members

of the Commission, other than employees of the State and Canal

Corporation, while away from their homes or regular places of

business to perform services for the Commission, shall be allowed

travel expenses, including per diem in lieu of subsistence, in the

same manner as persons employed intermittently in Government

service are allowed under section 5703 of title 5, United States

Code.

(e) ELECTION OF OFFICES.—The Commission shall elect the

chairperson and the vice chairperson on an annual basis. The

vice chairperson shall serve as the chairperson in the absence

of the chairperson.

(f ) QUORUM AND VOTING.—Fourteen members of the Commission shall constitute a quorum but a lesser number may hold

hearings. Any member of the Commission may vote by means

of a signed proxy exercised by another member of the Commission,

however, any member voting by proxy shall not be considered

present for purposes of establishing a quorum. For the transaction

of any business or the exercise of any power of the Commission,

the Commission shall have the power to act by a majority vote

of the members present at any meeting at which a quorum is

in attendance.

(g) MEETINGS.—The Commission shall meet at least quarterly

at the call of the chairperson or 14 of its members. Notice of

Commission meetings and agendas for the meeting shall be published in local newspapers throughout the Corridor. Meetings of

the Commission shall be subject to section 552b of title 5, United

States Code (relating to open meetings).

(h) POWERS OF THE COMMISSION.—To the extent that Federal

funds are appropriated, the Commission is authorized—

(1) to procure temporary and intermittent services and

administrative facilities at rates determined to be reasonable

by the Commission to carry out the responsibilities of the

Commission;

(2) to request and accept the services of personnel detailed

from the State of New York or any political subdivision, and

to reimburse the State or political subdivision for such services;

(3) to request and accept the services of any Federal agency

personnel, and to reimburse the Federal agency for such services;

(4) to appoint and fix the compensation of staff to carry

out its duties;

(5) to enter into cooperative agreements with the State

of New York, with any political subdivision of the State, or

any person for the purposes of carrying out the duties of the

Commission;

(6) to make grants to assist in the preparation and

implementation of the Canalway Plan;

(7) to seek, accept, and dispose of gifts, bequests, grants,

or donations of money, personal property, or services, received

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–299

from any source. For purposes of section 170(c) of the Internal

Revenue Code of 1986, any gift to the Commission shall be

deemed to be a gift to the United States;

(8) to assist others in developing educational, informational,

and interpretive programs and facilities, and other such activities that may promote the implementation of the Canalway

Plan;

(9) to hold hearings, sit and act at such times and places,

take such testimony, and receive such evidence, as the Commission may consider appropriate; the Commission may not issue

subpoenas or exercise any subpoena authority;

(10) to use the United States mails in the same manner

as other departments or agencies of the United States;

(11) to request and receive from the Administrator of General Services, on a reimbursable basis, such administrative

support services as the Commission may request; and

(12) to establish such advisory groups as the Commission

deems necessary.

(i) ACQUISITION OF PROPERTY.—Except as provided for leasing

administrative facilities under section 804(h)(1), the Commission

may not acquire any real property or interest in real property.

( j) TERMINATION.—The Commission shall terminate on the day

occurring 10 years after the date of enactment of this title.

SEC. 805. DUTIES OF THE COMMISSION.

(a) PREPARATION OF CANALWAY PLAN.—Not later than 3 years

after the Commission receives Federal funding for this purpose,

the Commission shall prepare and submit a comprehensive

preservation and management Canalway Plan for the Corridor to

the Secretary and the Governor for review and approval. In addition

to the requirements outlined for the Canalway Plan in section

806, the Canalway Plan shall incorporate and integrate existing

Federal, State, and local plans to the extent appropriate regarding

historic preservation, conservation, education and interpretation,

community development, and tourism-related economic development

for the Corridor that are consistent with the purpose of this title.

The Commission shall solicit public comment on the development

of the Canalway Plan.

(b) IMPLEMENTATION OF CANALWAY PLAN.—After the Commission receives Federal funding for this purpose, and after review

and upon approval of the Canalway Plan by the Secretary and

the Governor, the Commission shall—

(1) undertake action to implement the Canalway Plan so

as to assist the people of the State of New York in enhancing

and interpreting the historical, cultural, educational, natural,

scenic, and recreational potential of the Corridor identified

in the Canalway Plan; and

(2) support public and private efforts in conservation and

preservation of the Canalway’s cultural and natural resources

and economic revitalization consistent with the goals of the

Canalway Plan.

(c) PRIORITY ACTIONS.—Priority actions which may be carried

out by the Commission under section 805(b), include—

(1) assisting in the appropriate preservation treatment of

the remaining elements of the original Erie Canal;

114 STAT. 2763A–300 PUBLIC LAW 106–554—APPENDIX D

(2) assisting State, local governments, and nonprofit

organizations in designing, establishing, and maintaining visitor centers, museums, and other interpretive exhibits in the

Corridor;

(3) assisting in the public awareness and appreciation for

the historic, cultural, natural, scenic, and recreational resources

and sites in the Corridor;

(4) assisting the State of New York, local governments,

and nonprofit organizations in the preservation and restoration

of any historic building, site, or district in the Corridor;

(5) encouraging, by appropriate means, enhanced economic

development in the Corridor consistent with the goals of the

Canalway Plan and the purposes of this title; and

(6) ensuring that clear, consistent signs identifying access

points and sites of interest are put in place in the Corridor.

(d) ANNUAL REPORTS AND AUDITS.—For any year in which

Federal funds have been received under this title, the Commission

shall submit an annual report and shall make available an audit

of all relevant records to the Governor and the Secretary identifying

its expenses and any income, the entities to which any grants

or technical assistance were made during the year for which the

report was made, and contributions by other parties toward achieving Corridor purposes.

SEC. 806. CANALWAY PLAN.

(a) CANALWAY PLAN REQUIREMENTS.—The Canalway Plan

shall—

(1) include a review of existing plans for the Corridor,

including the Canal Recreationway Plan and Canal Revitalization Program, and incorporate them to the extent feasible to

ensure consistence with local, regional, and State planning

efforts;

(2) provide a thematic inventory, survey, and evaluation

of historic properties that should be conserved, restored, developed, or maintained because of their natural, cultural, or historic significance within the Corridor in accordance with the

regulations for the National Register of Historic Places;

(3) identify public and private-sector preservation goals

and strategies for the Corridor;

(4) include a comprehensive interpretive plan that identifies, develops, supports, and enhances interpretation and education programs within the Corridor that may include—

(A) research related to the construction and history

of the canals and the cultural heritage of the canal workers,

their families, those that traveled along the canals, the

associated farming activities, the landscape, and the

communities;

(B) documentation of and methods to support the

perpetuation of music, art, poetry, literature and folkways

associated with the canals; and

(C) educational and interpretative programs related

to the Erie Canalway developed in cooperation with State

and local governments, educational institutions, and nonprofit institutions;

(5) include a strategy to further the recreational development of the Corridor that will enable users to uniquely experience the canal system;

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–301

(6) propose programs to protect, interpret, and promote

the Corridor’s historical, cultural, recreational, educational, scenic, and natural resources;

(7) include an inventory of canal-related natural, cultural

and historic sites and resources located in the Area;

(8) recommend Federal, State, and local strategies and

policies to support economic development, especially tourismrelated development and recreation, consistent with the purposes of the Corridor;

(9) develop criteria and priorities for financial preservation

assistance;

(10) identify and foster strong cooperative relationships

between the National Park Service, the New York State Canal

Corporation, other Federal and State agencies, and nongovernmental organizations;

(11) recommend specific areas for development of interpretive, educational, and technical assistance centers associated

with the Corridor; and

(12) contain a program for implementation of the Canalway

Plan by all necessary parties.

(b) APPROVAL OF THE CANALWAY PLAN.—The Secretary and

the Governor shall approve or disapprove the Canalway Plan not

later than 90 days after receiving the Canalway Plan.

(c) CRITERIA.—The Secretary may not approve the plan unless

the Secretary finds that the plan, if implemented, would adequately

protect the significant historical, cultural, natural, and recreational

resources of the Corridor and consistent with such protection provide adequate and appropriate outdoor recreational opportunities

and economic activities within the Corridor. In determining whether

or not to approve the Canalway Plan, the Secretary shall consider

whether—

(1) the Commission has afforded adequate opportunity,

including public hearings, for public and governmental involvement in the preparation of the Canalway Plan; and

(2) the Secretary has received adequate assurances from

the Governor and appropriate State officials that the recommended implementation program identified in the plan will

be initiated within a reasonable time after the date of approval

of the Canalway Plan and such program will ensure effective

implementation of State and local aspects of the Canalway

Plan.

(d) DISAPPROVAL OF CANALWAY PLAN.—If the Secretary or the

Governor do not approve the Canalway Plan, the Secretary or

the Governor shall advise the Commission in writing within 90

days the reasons therefore and shall indicate any recommendations

for revisions. Following completion of any necessary revisions of

the Canalway Plan, the Secretary and the Governor shall have

90 days to either approve or disapprove of the revised Canalway

Plan.

(e) AMENDMENTS TO CANALWAY PLAN.—The Secretary and the

Governor shall review substantial amendments to the Canalway

Plan. Funds appropriated pursuant to this title may not be

expended to implement the changes made by such amendments

until the Secretary and the Governor approve the amendments.

114 STAT. 2763A–302 PUBLIC LAW 106–554—APPENDIX D

SEC. 807. DUTIES OF THE SECRETARY.

(a) IN GENERAL.—The Secretary is authorized to assist the

Commission in the preparation of the Canalway Plan.

(b) TECHNICAL ASSISTANCE.—Pursuant to an approved

Canalway Plan, the Secretary is authorized to enter into cooperative

agreements with, provide technical assistance to and award grants

to the Commission to provide for the preservation and interpretation

of the natural, cultural, historical, recreational, and scenic resources

of the Corridor, if requested by the Commission.

(c) EARLY ACTIONS.—Prior to approval of the Canalway Plan,

with the approval of the Commission, the Secretary may provide

technical and planning assistance for early actions that are important to the purposes of this title and that protect and preserve

resources.

(d) CANALWAY PLAN IMPLEMENTATION.—Upon approval of the

Canalway Plan, the Secretary is authorized to implement those

activities that the Canalway Plan has identified that are the responsibility of the Secretary or agent of the Secretary to undertake

in the implementation of the Canalway Plan.

(e) DETAIL.—Each fiscal year during the existence of the

Commission and upon the request of the Commission, the Secretary

shall detail to the Commission, on a nonreimbursable basis, two

employees of the Department of the Interior to enable the Commission to carry out the Commission’s duties with regard to the

preparation and approval of the Canalway Plan. Such detail shall

be without interruption or loss of civil service status, benefits,

or privileges.

SEC. 808. DUTIES OF OTHER FEDERAL ENTITIES.

Any Federal entity conducting or supporting any activity

directly affecting the Corridor, and any unit of Government acting

pursuant to a grant of Federal funds or a Federal permit or agreement conducting or supporting such activities may—

(1) consult with the Secretary and the Commission with

respect to such activities;

(2) cooperate with the Secretary and the Commission in

carrying out their duties under this title and coordinate such

activities with the carrying out of such duties; and

(3) conduct or support such activities in a manner consistent with the Canalway Plan unless the Federal entity, after

consultation with the Secretary and the Commission, determines there is no practicable alternative.

SEC. 809. SAVINGS PROVISIONS.

(a) AUTHORITY OF GOVERNMENTS.—Nothing in this title shall

be construed to modify, enlarge, or diminish any authority of the

Federal, State, or local governments to regulate any use of land

as provided for by law or regulation.

(b) ZONING OR LAND.—Nothing in this title shall be construed

to grant powers of zoning or land use to the Commission.

(c) LOCAL AUTHORITY AND PRIVATE PROPERTY.—Nothing in this

title shall be construed to affect or to authorize the Commission

to interfere with—

(1) the rights of any person with respect to private property;

(2) any local zoning ordinance or land use plan of the

State of New York or political subdivision thereof; or

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–303

(3) any State or local canal-related development plans

including but not limited to the Canal Recreationway Plan

and the Canal Revitalization Program.

(d) FISH AND WILDLIFE.—The designation of the Corridor shall

not be diminish the authority of the State of New York to manage

fish and wildlife, including the regulation of fishing and hunting

within the Corridor.

SEC. 810. AUTHORIZATION OF APPROPRIATIONS.

(a) IN GENERAL.— (1) CORRIDOR.—There is authorized to be appropriated for the Corridor not more than $1,000,000 for any fiscal year.

Not more than a total of $10,000,000 may be appropriated

for the Corridor under this title.

(2) MATCHING REQUIREMENT.—Federal funding provided

under this paragraph may not exceed 50 percent of the total

cost of any activity carried out with such funds. The nonFederal share of such support may be in the form of cash,

services, or in-kind contributions, fairly valued.

(b) OTHER FUNDING.—In addition to the sums authorized in

subsection (a), there are authorized to be appropriated to the Secretary of the Interior such sums as are necessary for the Secretary

for planning and technical assistance.

TITLE IX—LAW ENFORCEMENT PAY EQUITY

SEC. 901. SHORT TITLE.

This title may be cited as the ‘‘Law Enforcement Pay Equity

Act of 2000’’.

SEC. 902. ESTABLISHMENT OF UNIFORM SALARY SCHEDULE FOR

UNITED STATES SECRET SERVICE UNIFORMED DIVISION

AND UNITED STATES PARK POLICE.

(a) IN GENERAL.—Section 501(c)(1) of the District of Columbia

Police and Firemen’s Salary Act of 1958 (sec. 4–416(c)(1), D.C.

Code) is amended to read as follows:

‘‘(c)(1) The annual rates of basic compensation of officers and

members of the United States Secret Service Uniformed Division

and the United States Park Police, serving in classes corresponding

or similar to those in the salary schedule in section 101, shall

be fixed in accordance with the following schedule of rates:

‘‘Salary

class and

title

Step 1 Step 2 Step 3 Step 4 Step 5 Step 6 Step 7

Time between

steps

52 weeks 104 weeks

Years in

service

123579

1: Private ... 32,623 34,587 36,626 38,306 41,001 43,728 45,407

3: Detective 42,378 44,502 46,620 48,746 50,837

4: Sergeant 46,151 48,446 50,746 53,056

5: Lieutenant 1 ........ 50,910 53,462 56,545

7: Captain 1 59,802 62,799

8: Inspector/

Major 1 .... 69,163 72,760

9: Deputy

Chief 1 ..... 79,768 85,158

114 STAT. 2763A–304 PUBLIC LAW 106–554—APPENDIX D

‘‘Salary

class and

title

Step 1 Step 2 Step 3 Step 4 Step 5 Step 6 Step 7

10: Assistant

Chief 2

11: Chief,

United

States Secret Service Uniformed

Division,

United

States

Park Police 3

1The rate of basic pay for positions in Salary Class 5, 7, 8, and 9 is limited to 95 percent of the

rate of pay for level V of the Executive Schedule. 2The rate of basic pay for positions in Salary Class 10 will be equal to 95 percent of the rate of

pay for level V of the Executive Schedule. 3The rate of basic pay for positions in Salary Class 11 will be equal to the rate of pay for level V

of the Executive Schedule.

‘‘Salary

class and

title

Step 8 Step 9 Step 10 Step 11 Step 12 Step 13 Step 14

Time between

steps

104 weeks 156 weeks 208 weeks

Years in

service

11 13 15 18 22 26 30

1: Private ... 47,107 48,801 50,498 53,448 55,394 57,036 58,746

3: Detective 52,972 55,086 57,204 61,212 63,337 65,462 67,426

4: Sergeant 55,372 57,691 59,999 63,558 65,867 68,176 70,221

5: Lieutenant 1 ........ 59,120 61,688 64,258 68,197 70,744 73,290 75,489

7: Captain 1 65,797 68,757 71,747 76,292 79,309 82,325 84,796

8: Inspector/

Major 1 .... 76,542 80,524 83,983 87,645 91,827 95,464 99,075

9: Deputy

Chief 1 ..... 90,578 95,980 99,968 103,957 107,945 111,933 115,291

10: Assistant

Chief 2

11: Chief,

United

States Secret Service Uniformed

Division,

United

States

Park Police 3

1The rate of basic pay for positions in Salary Class 5, 7, 8, and 9 is limited to 95 percent of the

rate of pay for level V of the Executive Schedule. 2The rate of basic pay for positions in Salary Class 10 will be equal to 95 percent of the rate of

pay for level V of the Executive Schedule. 3The rate of basic pay for positions in Salary Class 11 will be equal to the rate of pay for level V

of the Executive Schedule.

(b) FREEZE OF CURRENT RATE FOR LOCALITY-BASED COM- PARABILITY ADJUSTMENTS.—Notwithstanding any other provision

of law, including this title or any provision of law amended by

this title, no officer or member of the United States Secret Service

Uniformed Division or the United States Park Police may be paid

locality pay under section 5304 or section 5304a of title 5, United

States Code, at a percentage rate for the applicable locality in

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–305

excess of the rate in effect for pay periods during calendar year

2000.

(c) CONFORMING AMENDMENTS.— (1) APPLICATION OF PROVISIONS TO PARK POLICE.—Section

501(c) of such Act (sec. 4–416(c), D.C. Code) is amended— (A) in paragraph (2), by striking ‘‘Treasury’’ and inserting the following: ‘‘Treasury, and the annual rates of basic

compensation of officers and members of the United States

Park Police shall be adjusted by the Secretary of the

Interior,’’;

(B) in paragraph (5), by inserting after ‘‘Uniformed

Division’’ the following: ‘‘or officers and members of the

United States Park Police’’;

(C) in paragraph (6)(A), by inserting after ‘‘Uniformed

Division’’ the following: ‘‘or the United States Park Police’’;

and

(D) in paragraph (7)(A), by inserting after ‘‘Uniformed

Division’’ the following: ‘‘or the United States Park Police’’. (2) TERMINATION OF CURRENT ADJUSTMENT AUTHORITY.— Section 501(b) of such Act (sec. 4–416(b), D.C. Code) is amended

by adding at the end the following new paragraph:

‘‘(4) This subsection shall not apply with respect to any pay

period for which the salary schedule under subsection (c) applies

to the United States Park Police.’’.

SEC. 903. REVISION OF CAPS ON MAXIMUM COMPENSATION.

(a) ANNUAL SALARY UNDER SCHEDULE.—Section 501(c)(2) of

the District of Columbia Police and Firemen’s Salary Act of 1958

(sec. 4–416(c)(2), D.C. Code) is amended by striking the period

at the end and inserting the following: ‘‘, except that in no case

may the annual rate of basic compensation for any such officer

or member exceed the rate of basic pay payable for level IV of

the Executive Schedule contained in subchapter II of chapter 53

of title 5, United States Code.’’. (b) REPEAL OF CAP ON COMBINED BASIC PAY AND LONGEVITY

PAY.—Section 501(c) of such Act (sec. 4–416(c), D.C. Code) is amended by striking paragraph (4).

(c) LIMITATION ON PAY PERIOD EARNINGS FOR COMP TIME.— Section 1(h) of the Act entitled ‘‘An Act to provide a 5-day week

for officers and members of the Metropolitan Police force, the United

States Park Police force, and the White House Police force, and

for other purposes’’, approved August 15, 1950 (sec. 4–1104(h),

D.C. Code), is amended— (1) in paragraphs (1) and (2), by striking ‘‘Metropolitan

Police force; or of the Fire Department of the District of Columbia; or of the United States Park Police’’ each place it appears

and inserting ‘‘Metropolitan Police force or of the Fire Department of the District of Columbia’’; and

(2) in paragraph (3), by inserting after ‘‘United States

Secret Service Uniformed Division’’ each place it appears the

following: ‘‘or of the United States Park Police’’.

SEC. 904. DETERMINATION OF SERVICE STEP ADJUSTMENTS.

(a) METHOD FOR DETERMINATION OF ADJUSTMENTS.—Section

303(a) of the District of Columbia Police and Firemen’s Salary

Act of 1958 (sec. 4–412(a), D.C. Code) is amended—

(1) in the matter preceding paragraph (1), by ‘‘Each’’ and

inserting ‘‘Except as provided in paragraph (5), each’’; and

114 STAT. 2763A–306 PUBLIC LAW 106–554—APPENDIX D

(2) by adding at the end the following new paragraph:

‘‘(5) Each officer and member of the United States Secret

Service Uniformed Division and the United States Park Police

with a current performance rating of ‘satisfactory’ or better,

shall have a service step adjustment in the following manner:

‘‘(A) Each officer and member in service step 1, 2,

or 3 shall be advanced in compensation successively to

the next higher service step at the beginning of the 1st

pay period immediately subsequent to the completion of

52 calendar weeks of active service in the officer’s or member’s service step.

‘‘(B) Each officer and member in service step 4, 5,

6, 7, 8, or 9 shall be advanced in compensation successively

to the next higher service step at the beginning of the

1st pay period immediately subsequent to the completion

of 104 calendar weeks of active service in the officer’s

or member’s service step.

‘‘(C) Each officer and member in service step 10 shall

be advanced in compensation successively to the next

higher service step at the beginning of the 1st pay period

immediately subsequent to the completion of 156 calendar

weeks of active service in the officer’s or member’s service

step.

‘‘(D) Each officer and member in service steps 11, 12,

or 13 shall be advanced in compensation successively to

the next higher service step at the beginning of the 1st

pay period immediately subsequent to the completion of

208 calendar weeks of active service in the officer’s or

member’s service step.’’.

(b) USE OF TOTAL CREDITABLE SERVICE TO DETERMINE STEP

PLACEMENT.—Section 304 of such Act (sec. 4–413, D.C. Code) is

amended—

(1) in subsection (a), by striking ‘‘(b)’’ and inserting ‘‘(b)

or (c)’’; and

(2) by adding at the end the following new subsection: ‘‘(c)(1) Each officer and member of the United States Secret

Service Uniformed Division or the United States Park Police who

is promoted or transferred to a higher salary shall receive basic

compensation in accordance with the officer’s or member’s total

creditable service.

‘‘(2) For purposes of this subsection, an officer’s or member’s

creditable service is any police service in pay status with the United

States Secret Service Uniformed Division, United States Park

Police, or Metropolitan Police Department.’’.

(c) CONFORMING AMENDMENT.—Section 401(a) of such Act (sec.

4–415(a), D.C. Code) is amended by adding at the end the following

new paragraph:

‘‘(4) This subsection shall not apply to officers and members

of the United States Secret Service Uniformed Division or the

United States Park Police.’’.

SEC. 905. CONVERSION TO NEW SALARY SCHEDULE.

(a) IN GENERAL.—

(1) DETERMINATION OF RATES OF BASIC PAY.—Effective on

the first day of the 1st pay period beginning 6 months after

the date of enactment of this Act, the Secretary of the Treasury

shall fix the rates of basic pay for officers and members of

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–307

the United States Secret Service Uniformed Division, and the

Secretary of the Interior shall fix the rates of basic pay for

officers and members of the United States Park Police, in

accordance with this subsection.

(2) PLACEMENT ON REVISED SALARY SCHEDULE.— (A) IN GENERAL.—Each officer and member shall be

placed in and receive basic compensation at the corresponding scheduled service step of the salary schedule under

section 501(c) of the District of Columbia Police and Firemen’s Salary Act of 1958 (as amended by section 902(a))

in accordance with the member’s total years of creditable

service, receiving credit for all service step adjustments.

If the scheduled rate of pay for the step to which the

officer or member would be assigned in accordance with

this paragraph is lower than the officer’s or member’s

salary immediately prior to the enactment of this paragraph, the officer or member will be placed in and receive

compensation at the next higher service step.

(B) CREDIT FOR INCREASES DURING TRANSITION.—Each

member whose position is to be converted to the salary

schedule under section 501(b) of the District of Columbia

Police and Firemen’s Salary Act of 1958 (as amended by

subsection (a)) and who, prior to the effective date of this

section has earned, but has not been credited with, an

increase in his or her rate of pay shall be afforded that

increase before such member is placed in the corresponding

service step in the salary schedule under section 501(b).

(C) CREDITABLE SERVICE DESCRIBED.—For purposes of

this paragraph, an officer’s or member’s creditable service

is any police service in pay status with the United States

Secret Service Uniformed Division, United States Park

Police, or Metropolitan Police Department.

(b) HOLD HARMLESS FOR CURRENT TOTAL COMPENSATION.—

Notwithstanding any other provision of law, if the total rate of

compensation for an officer or employee for any pay period occurring

after conversion to the salary schedule pursuant to subsection (a)

(determined by taking into account any locality-based comparability

adjustments, longevity pay, and other adjustments paid in addition

to the rate of basic compensation) is less than the officer’s or

employee’s total rate of compensation (as so determined) on the

date of enactment, the rate of compensation for the officer or

employee for the pay period shall be equal to—

(1) the rate of compensation on the date of enactment

(as so determined); increased by

(2) a percentage equal to 50 percent of sum of the percentage adjustments made in the rate of basic compensation under

section 501(c) of the District of Columbia Police and Firemen’s

Salary Act of 1958 (as amended by subsection (a)) for pay

periods occurring after the date of enactment and prior to

the pay period involved.

(c) CONVERSION NOT TREATED AS TRANSFER OR PROMOTION.— The conversion of positions and individuals to appropriate classes

of the salary schedule under section 501(c) of the District of Columbia Police and Firemen’s Salary Act of 1958 (as amended by section

902(a)) and the initial adjustments of rates of basic pay of those

positions and individuals in accordance with subsection (a) shall

not be considered to be transfers or promotions within the meaning

114 STAT. 2763A–308 PUBLIC LAW 106–554—APPENDIX D

of section 304 of the District of Columbia Police and Firemen’s

Salary Act of 1958 (sec. 4–413, D.C. Code).

(d) TRANSFER OF CREDIT FOR SATISFACTORY SERVICE.—Each

individual whose position is converted to the salary schedule under

section 501(c) of the District of Columbia Police and Firemen’s

Salary Act of 1958 (as amended by section 902(a)) in accordance

with subsection (a) shall be granted credit for purposes of such

individual’s first service step adjustment under the salary schedule

in such section 501(c) for all satisfactory service performed by

the individual since the individual’s last increase in basic pay

prior to the adjustment under that section.

(e) ADJUSTMENT TO TAKE INTO ACCOUNT GENERAL SCHEDULE

ADJUSTMENTS DURING TRANSITION.—The rates provided under the

salary schedule under section 501(c) of the District of Columbia

Police and Firemen’s Salary Act of 1958 (as amended by section

902(a)) shall be increased by the percentage of any annual adjustment applicable to the General Schedule authorized under section

5303 of title 5, United States Code, which takes effect during

the period which begins on the date of the enactment of this

Act and ends on the first day of the first pay period beginning

6 months after the date of enactment of this Act.

(f ) CONVERSION NOT TREATED AS SALARY INCREASE FOR PURPOSES OF CERTAIN PENSIONS AND ALLOWANCES.—The conversion

of positions and individuals to appropriate classes of the salary

schedule under section 501(c) of the District of Columbia Police

and Firemen’s Salary Act of 1958 (as amended by section 2(a))

and the initial adjustments of rates of basic pay of those positions

and individuals in accordance with subsection (a) shall not be

treated as an increase in salary for purposes of section 3 of the

Act entitled ‘‘An Act to provide increased pensions for widows

and children of deceased members of the Police Department and

the Fire Department of the District of Columbia’’, approved August

4, 1949 (sec. 4–604, D.C. Code), or section 301 of the District

of Columbia Police and Firemen’s Salary Act of 1953 (sec. 4–605,

D.C. Code).

SEC. 906. PAY ADJUSTMENTS FOR CERTAIN POSITIONS.

(a) TECHNICIAN DUTY.—Section 302 of the District of Columbia

Police and Firemen’s Salary Act of 1958 (sec. 4–411, D.C. Code)

is amended—

(1) in subsection (b), by striking ‘‘$810 per annum’’ and

inserting the following: ‘‘$810 per annum, except in the case

of an officer or member of the United States Secret Service

Uniformed Division or the United States Park Police, who

shall receive a per annum amount equal to 6 percent of the

sum of such officer’s or member’s rate of basic compensation

plus locality pay adjustments’’;

(2) in subsection (c), by striking ‘‘$595 per annum’’ each

place it appears and inserting the following: ‘‘$595 per annum,

except in the case of an officer or member of the United States

Park Police, who shall receive a per annum amount equal

to 6 percent of the sum of such officer’s or member’s rate

of basic compensation plus locality pay adjustments’’; and

(3) in subsection (e), by inserting after ‘‘Whenever any

officer or member’’ the following: ‘‘(other than an officer or

member of the United States Secret Service Uniformed Division

or the United States Park Police)’’.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–309

(b) HELICOPTER PILOT, BOMB DISPOSAL, OR SCUBA DIVING

DUTY.—Section 202 of such Act (sec. 4–408, D.C. Code) is amended

by striking ‘‘$2,270 per annum’’ and inserting the following: ‘‘$2,270

per annum, except in the case of an officer or member of the

United States Park Police, who shall receive a per annum amount

equal to 7 percent of the sum of such officer’s or member’s rate

of basic compensation plus locality pay adjustments’’.

SEC. 907. CONFORMING PROVISIONS RELATING TO FEDERAL LAW

ENFORCEMENT PAY REFORM ACT.

(a) TERMINATION OF EXISTING SPECIAL SALARY RATES AND

ADJUSTMENTS.—Beginning on the effective date of this Act— (1) no existing special salary rates shall be authorized

for members of the United States Park Police under section

5305 of title 5, United States Code (or any previous similar

provision of law); and

(2) no special rates of pay or special pay adjustments

shall be applicable to members of the United States Park

Police pursuant to section 405 of the Federal Law Enforcement

Pay Reform Act of 1990.

(b) CONFORMING AMENDMENTS.—(1) Section 405(b) of the Federal Law Enforcement Pay Reform Act of 1990 (5 U.S.C. 5303

note) is amended to read as follows:

‘‘(b) This subsection applies with respect to any—

‘‘(1) special agent within the Diplomatic Security Service;

‘‘(2) probation officer (referred to in section 3672 of title

18, United States Code); or

‘‘(3) pretrial services officer (referred to in section 3153

of title 18, United States Code).’’.

(2) Section 405(c) of such Act (5 U.S.C. 5303 note) is amended

to read as follows:

‘‘(c) For purposes of this section, the term ‘appropriate agency

head’ means—

‘‘(1) with respect to any individual under subsection (b)(1),

the Secretary of State; or ‘‘(2) with respect to any individual under subsection (b)(2)

or (b)(3), the Director of the Administrative Office of the United

States Courts.’’.

SEC. 908. SERVICE LONGEVITY PAYMENTS FOR METROPOLITAN

POLICE DEPARTMENT.

(a) INCLUSION OF SERVICE LONGEVITY PAYMENTS IN AMOUNT

OF FEDERAL BENEFIT PAYMENTS MADE TO METROPOLITAN POLICE

DEPARTMENT OFFICERS AND MEMBERS.—Section 11012 of the District of Columbia Retirement Protection Act of 1997 (Public Law

105–33; 111 Stat. 718; D.C. Code, sec. 1–762.2) is amended by

adding at the end the following new subsection:

‘‘(e) TREATMENT OF INCREASES IN CERTAIN POLICE SERVICE

LONGEVITY PAYMENTS.—For purposes of subsection (a), in determining the amount of a Federal benefit payment made to an officer

or member of the Metropolitan Police Department, the benefit payment to which the officer or member is entitled under the District

Retirement Program shall include any amounts which would have

been included in the benefit payment under such Program if the

amendments made by the Police Recruiting and Retention Enhancement Amendment Act of 1999 had taken effect prior to the freeze

date.’’.

114 STAT. 2763A–310 PUBLIC LAW 106–554—APPENDIX D

(b) CONFORMING AMENDMENT.—Section 11003(5) of such Act

(Public Law 105–33; 111 Stat. 717; D.C. Code, sec. 1–761.2(5))

is amended by inserting after ‘‘except as’’ the following: ‘‘provided

under section 11012(e) and as’’.

(c) EFFECTIVE DATE.—The amendments made by this section

shall apply with respect to Federal benefit payments made after

the date of the enactment of this Act.

SEC. 909. EFFECTIVE DATE.

Except as provided in section 908(c), this title and the amendments made by this title shall become effective on the first day

of the first pay period beginning 6 months after the date of enactment.

TITLE X

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT

ADMINISTRATIVE PROVISIONS

SEC. 1001. Section 206(d) of the Departments of Veterans

Affairs and Housing and Urban Development, and Independent

Agencies Appropriations Act, 2000 (42 U.S.C. 12701 note) is

amended—

(1) in paragraph (1), by striking ‘‘V’’ and inserting ‘‘III’’;

and

(2) in paragraph (4), by striking ‘‘reimbursable’’ and inserting ‘‘non-reimbursable’’.

SEC. 1002. For purposes of part 2, subpart B of the Federal

Housing Enterprises Financial Safety and Soundness Act of 1992

(Public Law 102–550), notwithstanding any other provision of law

or regulation, for purposes of measuring the extent of compliance

with the housing goals for the years 2001, 2002, and 2003, the

Secretary of Housing and Urban Development shall assign, in the

case of the Federal Home Loan Mortgage Corporation, 1.35 units

of credit toward achievement of each housing goal for each unit

of multifamily housing (excepting units located in properties having

between 5 and 50 units) qualifying as affordable under such housing

goal.

SEC. 1003. Notwithstanding any other provision of law, neither

the City of Toledo, Ohio, nor the Secretary of Housing and Urban

Development (HUD) is required to enforce any requirements associated with Housing Development Grant number 00H006H6402 provided to the City of Toledo, Ohio, that prohibit or restrict the

conversion of the rental units in the Beacon Place project to condominium ownership: Provided, That the City of Toledo and the

Secretary of HUD are authorized to take any actions necessary

to cause any such prohibition or restriction to be removed from

the appropriate land records and otherwise terminated: Provided

further, That converted units shall remain available as rental housing to those persons, including low- and very-low-income persons

who presently reside in the units: Provided further, That the conversion proposal for Beacon Place apartments shall not reduce the

number of affordable housing units in Toledo: Provided further,

That any and all proceeds from such conversion are used to retire

debt associated with the Beacon Place project or to rehabilitate

the properties known as the Cubbon Properties.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–311

SEC. 1004. The Comptroller General of the United States shall

conduct a study on the following topics— (a)(1) The adequacy of the capital structure of the Federal

Home Loan Bank (FHLB) System as it relates to the risks

posed by: (A) the traditional advances business of the FHLB

System; (B) the expanded collateral provisions and permissible

uses of advances under the Gramm-Leach-Bliley Act of 1999;

and (C) the MPF, and other programs providing for the direct

acquisition of mortgages. The analysis should examine the

credit risk, interest rate risk, and operations risk associated

with each structure;

(2) The risks associated with further growth in the direct

acquisition of mortgages by the Federal Home Loan Bank System; and

(3) A comparison of the risk-based capital standard proposed by the Federal Housing Finance Board for the Federal

Home Loan Bank System to the standard proposed by the

Office of Federal Housing Enterprise Oversight for the Federal

National Mortgage Association and the Federal Home Loan

Mortgage Corporation.

(b) Not later than 6 months after the date of the enactment

of this Act, the Comptroller General shall submit to the

Committee on Banking, Housing, and Urban Affairs of the

Senate and the Committee on Banking and Financial Services

of the House of Representatives a report on the study required

under subsection (a).

TITLE XI

DEPARTMENT OF THE TREASURY

ADMINISTRATIVE PROVISION

SEC. 1101. HONORING THE NAVAJO CODE TALKERS.

(a) Congress finds that— (1) on December 7, 1941, the Japanese Empire attacked

Pearl Harbor and war was declared by Congress the following

day;

(2) the military code, developed by the United States for

transmitting messages, had been deciphered by the Japanese,

and a search by United States intelligence was made to develop

new means to counter the enemy;

(3) the United States Government called upon the Navajo

Nation to support the military effort by recruiting and enlisting

29 Navajo men to serve as Marine Corps Radio Operators;

(4) the number of Navajo enlistees later increased to more

than 350;

(5) at the time, the Navajos were often treated as secondclass citizens, and they were a people who were discouraged

from using their own native language;

(6) the Navajo Marine Corps Radio Operators, who became

known as the ‘‘Navajo Code Talkers’’, were used to develop

a code using their native language to communicate military

messages in the Pacific;

(7) to the enemy’s frustration, the code developed by these

Native Americans proved to be unbreakable, and was used

extensively throughout the Pacific theater;

114 STAT. 2763A–312 PUBLIC LAW 106–554—APPENDIX D

(8) the Navajo language, discouraged in the past, was

instrumental in developing the most significant and successful

military code of the time;

(9) at Iwo Jima alone, the Navajo Code Talkers passed

over 800 error-free messages in a 48-hour period;

(10) use of the Navajo Code was so successful, that—

(A) military commanders credited it in saving the lives

of countless American soldiers and in the success of the

engagements of the United States in the battles of Guadalcanal, Tarawa, Saipan, Iwo Jima, and Okinawa;

(B) some Code Talkers were guarded by fellow marines,

whose role was to kill them in case of imminent capture

by the enemy; and

(C) the Navajo Code was kept secret for 23 years

after the end of World War II;

(11) following the conclusion of World War II, the Department of Defense maintained the secrecy of the Navajo code

until it was declassified in 1968; and

(12) only then did a realization of the sacrifice and valor

of these brave Native Americans emerge from history.

(b)(1) To express recognition by the United States and its

citizens in honoring the Navajo Code Talkers, who distinguished

themselves in performing a unique, highly successful communications operation that greatly assisted in saving countless lives and

hastening the end of World War II in the Pacific, the President

is authorized—

(A) to award to each of the original 29 Navajo Code Talkers,

or a surviving family member, on behalf of the Congress, a

gold medal of appropriate design, honoring the Navajo Code

Talkers; and

(B) to award to each person who qualified as a Navajo

Code Talker (MOS 642), or a surviving family member, on

behalf of the Congress, a silver medal of appropriate design,

honoring the Navajo Code Talkers.

(2) For purposes of the awards authorized by paragraph (1),

the Secretary of the Treasury (in this section referred to as the

‘‘Secretary’’) shall strike gold and silver medals with suitable

emblems, devices, and inscriptions, to be determined by the Secretary.

(c) The Secretary may strike and sell duplicates in bronze

of the medals struck pursuant to this section, under such regulations as the Secretary may prescribe, and a price sufficient to

cover the costs thereof, including labor, materials, dies, use of

machinery, and overhead expenses, and the cost of the medals.

(d) The medals struck pursuant to this section are national

medals for purposes of chapter 51, of title 31, United States Code.

(e)(1) There is authorized to be charged against the United

States Mint Public Enterprise Fund, such sums as may be necessary

to pay for the costs of the medals authorized by this section.

(2) Amounts received from the sale of duplicate medals under

this section shall be deposited in the United States Mint Public

Enterprise Fund.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–313

TITLE XII

ENVIRONMENTAL PROTECTION AGENCY

ADMINISTRATIVE PROVISION

SEC. 1201. ABOVEGROUND STORAGE TANK GRANT PROGRAM.

(a) DEFINITIONS.—In this provision:

(1) ABOVEGROUND STORAGE TANK.—The term ‘‘aboveground

storage tank’’ means any tank or combination of tanks (including any connected pipe)— (A) that is used to contain an accumulation of regulated

substances; and

(B) the volume of which (including the volume of any

connected pipe) is located wholly above the surface of the

ground.

(2) ADMINISTRATOR.—The term ‘‘Administrator’’ means the

Administrator of the Environmental Protection Agency.

(3) DENALI COMMISSION.—The term ‘‘Denali Commission’’

means the commission established by section 303(a) of the

Denali Commission Act of 1998 (42 U.S.C. 3121 note).

(4) FEDERAL ENVIRONMENTAL LAW.—The term ‘‘Federal

environmental law’’ means—

(A) the Oil Pollution Control Act of 1990 (33 U.S.C.

2701 et seq.);

(B) the Comprehensive Environmental Response, Compensation, and Liability Act of 1980 (42 U.S.C. 9601 et

seq.);

(C) the Solid Waste Disposal Act (42 U.S.C. 6901 et

seq.);

(D) the Federal Water Pollution Control Act (33 U.S.C.

1251 et seq.); or

(E) any other Federal law that is applicable to the

release into the environment of a regulated substance,

as determined by the Administrator.

(5) NATIVE VILLAGE.—The term ‘‘Native village’’ has the

meaning given the term in section 11(b) in Public Law 92–

203 (85 Stat. 688).

(6) PROGRAM.—The term ‘‘program’’ means the Aboveground Storage Tank Grant Program established by subsection

(b)(1).

(7) REGULATED SUBSTANCE.—The term ‘‘regulated substance’’ has the meaning given the term in section 9001 of

the Solid Waste Disposal Act (42 U.S.C. 6991).

(8) STATE.—The term ‘‘State’’ means the State of Alaska.

(b) ESTABLISHMENT.—

(1) IN GENERAL.—There is established a grant program

to be known as the ‘‘Aboveground Storage Tank Grant Program’’.

(2) GRANTS.—Under the program, the Administrator shall

award a grant to—

(A) the State, on behalf of a Native village; or

(B) the Denali Commission.

(c) USE OF GRANTS.—The State or the Denali Commission

shall use the funds of a grant under subsection (b) to repair,

upgrade, or replace one or more aboveground storage tanks that—

114 STAT. 2763A–314 PUBLIC LAW 106–554—APPENDIX D

(1) leaks or poses an imminent threat of leaking, as certified

by the Administrator, the Commandant of the Coast Guard,

or any other appropriate Federal or State agency (as determined

by the Administrator); and

(2) is located in a Native village—

(A) the median household income of which is less than

80 percent of the median household income in the State;

(B) that is located—

(i) within the boundaries of—

(I) a unit of the National Park System;

(II) a unit of the National Wildlife Refuge

System; or

(III) a National Forest; or

(ii) on public land under the administrative jurisdiction of the Bureau of Land Management; or

(C) that receives payments from the Federal Government under chapter 69 of title 31, United States Code

(commonly known as ‘‘payments in lieu of taxes’’).

(d) REPORTS.—Not later than 1 year after the date on which

the State or the Denali Commission receives a grant under subsection (c), and annually thereafter, the State or the Denali Commission, as the case may be, shall submit a report describing each

project completed with grant funds and any projects planned for

the following year, to—

(1) the Administrator;

(2) the Committee on Resources of the House of Representatives;

(3) the Committee on Environment and Public Works of

the Senate;

(4) the Committee on Appropriations of the House of Representatives; and

(5) the Committee on Appropriations of the Senate.

(e) AUTHORIZATION OF APPROPRIATIONS.—There are authorized

to be appropriated to carry out this Act, to remain available until

expended—

(1) $20,000,000 for fiscal year 2001; and

(2) such sums as are necessary for each fiscal year thereafter.

TITLE XIII

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

ADMINISTRATIVE PROVISION

SEC. 1301. Of the proceeds in any fiscal year from the sale

of timber on Federal property at the John C. Stennis Space Center,

or on additional real property within the restricted easement area

adjacent to the Center, any funds that are in excess of the amount

necessary for the expenses of commonly accepted forest management

practices on such properties may be retained and used by the

National Aeronautics and Space Administration for the acquisition

from willing sellers of up to a total of 500 acres of real property

to establish education and visitor programs and facilities that promote and preserve the regional and national history of the area,

including the contributions of Stennis Space Center, and, as necessary, for wetlands mitigation.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–315

TITLE XIV—CERTAIN ALASKAN CRUISE SHIP OPERATIONS

SEC. 1401. PURPOSE.

The purpose of this title is to:

(1) Ensure that cruise vessels operating in the waters of

the Alexander Archipelago and the navigable waters of the

United States within the State of Alaska and within the

Kachemak Bay National Estuarine Research Reserve comply

with all applicable environmental laws, including, but not limited to, the Federal Water Pollution Control Act, as amended

(33 U.S.C. 1251 et seq.), the Act to Prevent Pollution from

Ships, as amended (33 U.S.C. 1901 et seq.), and the protections

contained within this title.

(2) Ensure that cruise vessels do not discharge untreated

sewage within the waters of the Alexander Archipelago, the

navigable waters of the United States in the State of Alaska,

or within the Kachemak Bay National Estuarine Research

Reserve.

(3) Prevent the unregulated discharge of treated sewage

and graywater while in ports in the State of Alaska or traveling

near the shore in the Alexander Archipelago and the navigable

waters of the United States in the State of Alaska or within

the Kachemak Bay National Estuarine Research Reserve.

(4) Ensure that discharges of sewage and graywater from

cruise vessels operating in the Alexander Archipelago and the

navigable waters of the United States in the State of Alaska

or within the Kachemak Bay National Estuarine Research

Reserve can be monitored for compliance with the requirements

contained in this title.

SEC. 1402. APPLICABILITY.

This title applies to all cruise vessels authorized to carry 500

or more passengers for hire.

SEC. 1403. PROHIBITION ON DISCHARGE OF UNTREATED SEWAGE.

No person shall discharge any untreated sewage from a cruise

vessel into the waters of the Alexander Archipelago or the navigable

waters of the United States within the State of Alaska or within

the Kachemak Bay National Estuarine Research Reserve.

SEC. 1404. LIMITATIONS ON DISCHARGE OF TREATED SEWAGE OR

GRAYWATER.

(a) No person shall discharge any treated sewage or graywater

from a cruise vessel into the waters of the Alexander Archipelago

or the navigable waters of the United States within the State

of Alaska or within the Kachemak Bay National Estuarine Research

Reserve unless—

(1) the cruise vessel is underway and proceeding at a

speed of not less than six knots;

(2) the cruise vessel is not less than one nautical mile

from the nearest shore, except in areas designated by the

Secretary, in consultation with the State of Alaska;

(3) the discharge complies with all applicable cruise vessel

effluent standards established pursuant to this title and any

other applicable law; and

(4) the cruise vessel is not in an area where the discharge

of treated sewage or graywater is prohibited.

114 STAT. 2763A–316 PUBLIC LAW 106–554—APPENDIX D

(b) The Administrator, in consultation with the Secretary, may

promulgate regulations allowing the discharge of treated sewage

or graywater, otherwise prohibited under paragraphs (a)(1) and

(a)(2) of this section, where the discharge meets effluent standards

determined by the Administrator as appropriate for discharges into

the marine environment. In promulgating such regulations, the

Administrator shall take into account the best available scientific

information on the environmental effects of the regulated discharges. The effluent discharge standards promulgated under this

section shall, at a minimum, be consistent with all relevant State

of Alaska water quality standards in force at the time of the

enactment of this title.

(c) Until such time as the Administrator promulgates regulations under paragraph (b) of this section, treated sewage and

graywater may be discharged from vessels subject to this title

in circumstances otherwise prohibited under paragraphs (a)(1) and

(a)(2) of this section, provided that— (1) the discharge satisfies the minimum level of effluent

quality specified in 40 CFR 133.102, as in effect on the date

of enactment of this section;

(2) the geometric mean of the samples from the discharge

during any 30-day period does not exceed 20 fecal coliform/

100 ml and not more than 10 percent of the samples exceed

40 fecal coliform/100 ml;

(3) concentrations of total residual chlorine may not exceed

10.0 μg/l; and

(4) prior to any such discharge occurring, the owner, operator or master, or other person in charge of a cruise vessel,

can demonstrate test results from at least five samples taken

from the vessel representative of the effluent to be discharged,

on different days over a 30-day period, conducted in accordance

with the guidelines promulgated by the Administrator in 40

CFR Part 136, which confirm that the water quality of the

effluents proposed for discharge is in compliance with paragraphs (1), (2), and (3) of this subsection. To the extent not

otherwise being done by the owner, operator, master or other

person in charge of a cruise vessel pursuant to section 1406,

the owner, operator, master or other person in charge of a

cruise vessel shall demonstrate continued compliance through

periodic sampling. Such sampling and test results shall be

considered environmental compliance records that must be

made available for inspection pursuant to section 1406(d) of

this title.

SEC. 1405. SAFETY EXCEPTION.

Sections 1403 and 1404 of this title shall not apply to discharges

made for the purpose of securing the safety of the cruise vessel

or saving life at sea, provided that all reasonable precautions have

been taken for the purpose of preventing or minimizing the discharge.

SEC. 1406. INSPECTION AND SAMPLING REGIME.

(a) The Secretary shall incorporate into the commercial vessel

examination program an inspection regime sufficient to verify that

cruise vessels visiting ports in the State of Alaska or operating

in the waters of the Alexander Archipelago or the navigable waters

of the United States within the State of Alaska or within the

Kachemak Bay National Estuarine Research Reserve are in full

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–317

compliance with this title, the Federal Water Pollution Control

Act, as amended, and any regulations issued thereunder, other

applicable Federal laws and regulations, and all applicable international treaty requirements.

(b) The inspection regime shall, at a minimum, include—

(1) examination of environmental compliance records and

procedures; and

(2) inspection of the functionality and proper operation

of installed equipment for abatement and control of any discharge.

(c) The inspection regime may—

(1) include unannounced inspections of any aspect of cruise

vessel operations, equipment or discharges pertinent to the

verification under subsection (a) of this section; and

(2) require the owner, operator or master, or other person

in charge of a cruise vessel subject to this title to maintain

and produce a logbook detailing the times, types, volumes or

flow rates and locations of any discharges of sewage or

graywater under this title.

(d) The inspection regime shall incorporate a plan for sampling

and testing cruise vessel discharges to ensure that any discharges

of sewage or graywater are in compliance with this title, the Federal

Water Pollution Control Act, as amended, and any other applicable

laws and regulations, and may require the owner, operator or

master, or other person in charge of a cruise vessel subject to

this title to conduct such samples or tests, and to produce any

records of such sampling or testing at the request of the Secretary

or Administrator.

SEC. 1407. CRUISE VESSEL EFFLUENT STANDARDS.

Pursuant to this title and the authority of the Federal Water

Pollution Control Act, as amended, the Administrator may promulgate effluent standards for treated sewage and graywater from

cruise vessels operating in the waters of the Alexander Archipelago

or the navigable waters of the United States within the State

of Alaska or within the Kachemak Bay National Estuarine Research

Reserve. Regulations implementing such standards shall take into

account the best available scientific information on the environmental effects of the regulated discharges and the availability of

new technologies for wastewater treatment. Until such time as

the Administrator promulgates such effluent standards, treated

sewage effluent discharges shall not have a fecal coliform bacterial

count of greater than 200 per 100 milliliters nor suspended solids

greater than 150 milligrams per liter.

SEC. 1408. REPORTS.

(a) Any owner, operator or master, or other person in charge

of a cruise vessel who has knowledge of a discharge from the

cruise vessel in violation of section 1403 or 1404 or pursuant to

section 1405 of this title, or any regulations promulgated thereunder, shall immediately report that discharge to the Secretary,

who shall provide a copy to the Administrator upon request.

(b) The Secretary may prescribe the form of reports required

under this section.

SEC. 1409. ENFORCEMENT.

(a) ADMINISTRATIVE PENALTIES.—

114 STAT. 2763A–318 PUBLIC LAW 106–554—APPENDIX D

(1) VIOLATIONS.—Any person who violates section 1403,

1404, 1408, or 1413 of this title, or any regulations promulgated

pursuant to this title may be assessed a class I or class II

civil penalty by the Secretary or Administrator.

(2) CLASSES OF PENALTIES.— (A) CLASS I.—The amount of a class I civil penalty under this section may not exceed $10,000 per violation,

except that the maximum amount of any class I civil penalty under this section shall not exceed $25,000. Before

assessing a civil penalty under this clause, the Secretary

or Administrator, as the case may be, shall give to the

person to be assessed such penalty written notice of the

Secretary’s or Administrator’s proposal to assess the penalty and the opportunity to request, within 30 days of

the date the notice is received by such person, a hearing

on the proposed penalty. Such hearing shall not be subject

to section 554 or 556 of title 5, but shall provide a reasonable opportunity to be heard and to present evidence.

(B) CLASS II.—The amount of a class II civil penalty

under this section may not exceed $10,000 per day for

each day during which the violation continues, except that

the maximum amount of any class II civil penalty under

this section shall not exceed $125,000. Except as otherwise

provided in this subsection, a class II civil penalty shall

be assessed and collected in the same manner, and subject

to the same provisions as in the case of civil penalties

assessed and collected after notice and an opportunity for

a hearing on the record in accordance with section 554

of title 5, United States Code. The Secretary and Administrator may issue rules for discovery procedures for hearings

under this paragraph.

(3) RIGHTS OF INTERESTED PERSONS.—

(A) PUBLIC NOTICE.—Before issuing an order assessing

a class II civil penalty under this section, the Secretary

or Administrator, as the case may be, shall provide public

notice of and reasonable opportunity to comment on the

proposed issuance of each order.

(B) PRESENTATION OF EVIDENCE.—Any person who comments on a proposed assessment of a class II civil penalty

under this section shall be given notice of any hearing

held under this paragraph and of the order assessing such

penalty. In any hearing held under this paragraph, such

person shall have a reasonable opportunity to be heard

and present evidence.

(C) RIGHTS OF INTERESTED PERSONS TO A HEARING.—

If no hearing is held under subsection (2) before issuance

of an order assessing a class II civil penalty under this

section, any person who commented on the proposed assessment may petition, within 30 days after the issuance of

such order, the Administrator or Secretary, as the case

may be, to set aside such order and to provide a hearing

on the penalty. If the evidence presented by the petitioner

in support of the petition is material and was not considered in the issuance of the order, the Administrator or

Secretary shall immediately set aside such order and provide a hearing in accordance with subsection (2)(B). If

the Administrator or Secretary denies a hearing under

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–319

this clause, the Administrator or Secretary shall provide

to the petitioner, and publish in the Federal Register, notice

of and the reasons for such denial.

(4) FINALITY OF ORDER.—An order assessing a class II

civil penalty under this paragraph shall become final 30 days

after its issuance unless a petition for judicial review is filed

under subparagraph (6) or a hearing is requested under subsection (3)(C). If such a hearing is denied, such order shall

become final 30 days after such denial.

(5) EFFECT OF ACTION ON COMPLIANCE.—No action by the

Administrator or Secretary under this paragraph shall affect

any person’s obligation to comply with any section of this title.

(6) JUDICIAL REVIEW.—Any person against whom a civil

penalty is assessed under this paragraph or who commented

on the proposed assessment of such penalty in accordance with

subsection (3) may obtain review of such assessment— (A) in the case of assessment of a class I civil penalty,

in the United States District Court for the District of

Columbia or in the District of Alaska; or

(B) in the case of assessment of a class II civil penalty,

in the United States Court of Appeals for the District

of Columbia Circuit or for any other circuit in which such

person resides or transacts business, by filing a notice

of appeal in such court within the 30-day period beginning

on the date the civil penalty order is issued and by simultaneously sending a copy of such notice by certified mail

to the Administrator or Secretary, as the case may be,

and the Attorney General. The Administrator or Secretary

shall promptly file in such court a certified copy of the

record on which the order was issued. Such court shall

not set aside or remand such order unless there is not

substantial evidence in the record, taken as a whole, to

support the finding of a violation or unless the Administrator’s or Secretary’s assessment of the penalty constitutes

an abuse of discretion and shall not impose additional

civil penalties for the same violation unless the Administrator’s or Secretary’s assessment of the penalty constitutes

an abuse of discretion.

(7) COLLECTION.—If any person fails to pay an assessment

of a civil penalty—

(A) after the assessment has become final, or

(B) after a court in an action brought under subsection

(6) has entered a final judgment in favor of the Administrator or Secretary, as the case may be, the Administrator

or Secretary shall request the Attorney General to bring

a civil action in an appropriate district court to recover

the amount assessed (plus interest at currently prevailing

rates from the date of the final order or the date of the

final judgment, as the case may be). In such an action,

the validity, amount, and appropriateness of such penalty

shall not be subject to review. Any person who fails to

pay on a timely basis the amount of an assessment of

a civil penalty as described in the first sentence of this

subparagraph shall be required to pay, in addition to such

amount and interest, attorneys fees and costs for collection

proceedings and a quarterly nonpayment penalty for each

quarter during which such failure to pay persists. Such

114 STAT. 2763A–320 PUBLIC LAW 106–554—APPENDIX D

nonpayment penalty shall be in an amount equal to 20

percent of the aggregate amount of such person’s penalties

and nonpayment penalties which are unpaid as of the

beginning of such quarter.

(8) SUBPOENAS.—The Administrator or Secretary, as the

case may be, may issue subpoenas for the attendance and

testimony of witnesses and the production of relevant papers,

books, or documents in connection with hearings under this

section. In case of contumacy or refusal to obey a subpoena

issued pursuant to this subsection and served upon any person,

the district court of the United States for any district in which

such person is found, resides, or transacts business, upon

application by the United States and after notice to such person,

shall have jurisdiction to issue an order requiring such person

to appear and give testimony before the Administrator or Secretary or to appear and produce documents before the Administrator or Secretary, or both, and any failure to obey such

order of the court may be punished by such court as a contempt

thereof.

(b) CIVIL PENALTIES.—

(1) IN GENERAL.—Any person who violates section 1403,

1404, 1408, or 1413 of this title, or any regulations promulgated

pursuant to this title shall be subject to a civil penalty not

to exceed $25,000 per day for each violation. Each day a violation continues constitutes a separate violation.

(2) JURISDICTION.—An action to impose a civil penalty

under this section may be brought in the district court of

the United States for the district in which the defendant is

located, resides, or transacts business, and such court shall

have jurisdiction to assess such penalty.

(3) LIMITATION.—A person is not liable for a civil judicial

penalty under this paragraph for a violation if the person

has been assessed a civil administrative penalty under paragraph (a) for the violation.

(c) DETERMINATION OF AMOUNT.—In determining the amount

of a civil penalty under paragraphs (a) or (b) of this section, the

court, the Secretary or the Administrator, as the case may be,

shall consider the seriousness of the violation or violations, the

economic benefit (if any) resulting from the violation, any history

of such violations, any good-faith efforts to comply with the

applicable requirements, the economic impact of the penalty on

the violator, and other such matters as justice may require.

(d) CRIMINAL PENALTIES.—

(1) NEGLIGENT VIOLATIONS.—Any person who negligently

violates section 1403, 1404, 1408, or 1413 of this title, or

any regulations promulgated pursuant to this title commits

a Class A misdemeanor.

(2) KNOWING VIOLATIONS.—Any person who knowingly violates section 1403, 1404, 1408, or 1413 of this title, or any

regulations promulgated pursuant to this title commits a Class

D felony.

(3) FALSE STATEMENTS.—Any person who knowingly makes

any false statement, representation, or certification in any

record, report or other document filed or required to be maintained under this title or the regulations issued thereunder,

or who falsifies, tampers with, or knowingly renders inaccurate

any testing or monitoring device or method required to be

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–321

maintained under this title, or the regulations issued thereunder, commits a Class D felony.

(e) AWARDS.—

(1) The Secretary, the Administrator, or the court, when

assessing any fines or civil penalties, as the case may be,

may pay from any fines or civil penalties collected under this

section an amount not to exceed one-half of the penalty or

fine collected, to any individual who furnishes information

which leads to the payment of the penalty or fine. If several

individuals provide such information, the amount shall be

divided equitably among such individuals. No officer or

employee of the United States, the State of Alaska or any

federally recognized Tribe who furnishes information or renders

service in the performance of his or her official duties shall

be eligible for payment under this subsection.

(2) The Secretary, Administrator or the court, when assessing any fines or civil penalties, as the case may be, may pay,

from any fines or civil penalties collected under this section,

to the State of Alaska or to any federally recognized Tribe

providing information or investigative assistance which leads

to payment of the penalty or fine, an amount which reflects

the level of information or investigative assistance provided.

Should the State of Alaska or a federally recognized Tribe

and an individual under paragraph (1) of this section be eligible

for an award, the Secretary, the Administrator, or the court,

as the case may be, shall divide the amount equitably.

(f ) LIABILITY IN REM.—A cruise vessel operated in violation

of this title or the regulations issued thereunder is liable in rem

for any fine imposed under subsection (d) of this section or for

any civil penalty imposed under subsections (a) or (b) of this section,

and may be proceeded against in the United States district court

of any district in which the cruise vessel may be found.

(g) COMPLIANCE ORDERS.—

(1) IN GENERAL.—Whenever on the basis of any information

available to him the Administrator finds that any person is

in violation of section 1403, 1404, 1408, or 1413 of this title,

or any regulations promulgated pursuant to this title, the

Administrator shall issue an order requiring such person to

comply with such section or requirement, or shall bring a

civil action in accordance with subsection (b).

(2) COPIES OF ORDERS, SERVICE.—A copy of any order issued

under this subsection shall be sent immediately by the Administrator to the State of Alaska. In any case in which an order

under this subsection is issued to a corporation, a copy of

such order shall be served on any appropriate corporate officer.

Any order issued under this subsection shall be by personal

service, shall state with reasonable specificity the nature of

the violation, and shall specify a time for compliance not to

exceed 30 days in the case of a violation of an interim compliance schedule or operation and maintenance requirement and

not to exceed a time the Administrator determines to be reasonable in the case of a violation of a final deadline, taking into

account the seriousness of the violation and any good faith

efforts to comply with applicable requirements.

(h) CIVIL ACTIONS.—The Administrator is authorized to commence a civil action for appropriate relief, including a permanent

or temporary injunction, for any violation for which he is authorized

114 STAT. 2763A–322 PUBLIC LAW 106–554—APPENDIX D

to issue a compliance order under this subsection. Any action under

subsection (h) may be brought in the district court of the United

States for the district in which the defendant is located or resides

or is doing business, and such court shall have jurisdiction to

restrain such violation and to require compliance. Notice of the

commencement of such action shall be given immediately to the

State of Alaska.

SEC. 1410. DESIGNATION OF CRUISE VESSEL NO-DISCHARGE ZONES.

If the State of Alaska determines that the protection and

enhancement of the quality of some or all of the waters of the

Alexander Archipelago or the navigable waters of the United States

within the State of Alaska or within the Kachemak Bay National

Estuarine Research Reserve require greater environmental protection, the State of Alaska may petition the Administrator to prohibit

the discharge of graywater and sewage from cruise vessels operating

in such waters. The establishment of such a prohibition shall be

achieved in the same manner as the petitioning process and prohibition of the discharge of sewage pursuant to section 312(f ) of the

Federal Water Pollution Control Act, as amended, and the regulations promulgated thereunder.

SEC. 1411. SAVINGS CLAUSE.

(a) Nothing in this title shall be construed as restricting, affecting, or amending any other law or the authority of any department,

instrumentality, or agency of the United States.

(b) Nothing in this title shall in any way affect or restrict,

or be construed to affect or restrict, the authority of the State

of Alaska or any political subdivision thereof—

(1) to impose additional liability or additional requirements;

or

(2) to impose, or determine the amount of a fine or penalty

(whether criminal or civil in nature) for any violation of law;

relating to the discharge of sewage (whether treated or

untreated) or graywater in the waters of the Alexander

Archipelago and the navigable waters of the United States

within the State of Alaska or within the Kachemak Bay

National Estuarine Research Reserve.

SEC. 1412. REGULATIONS.

The Secretary and the Administrator each may prescribe any

regulations necessary to carry out the provisions of this title.

SEC. 1413. INFORMATION GATHERING AUTHORITY.

The authority of sections 308(a) and (b) of the Federal Water

Pollution Control Act, as amended, shall be available to the

Administrator to carry out the provisions of this title. The Administrator and the Secretary shall minimize, to the extent practicable,

duplication of or inconsistency with the inspection, sampling, testing, recordkeeping, and reporting requirements established by the

Secretary under section 1406 of this title.

SEC. 1414. DEFINITIONS.

In this title:

(1) ADMINISTRATOR.—The term ‘‘Administrator’’ means the

Administrator of the United States Environmental Protection

Agency.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–323

(2) CRUISE VESSEL.—The term ‘‘cruise vessel’’ means a passenger vessel as defined in section 2101(22) of title 46, United

States Code. The term ‘‘cruise vessel’’ does not include a vessel

of the United States operated by the Federal Government or

a vessel owned and operated by the government of a State.

(3) DISCHARGE.—The term ‘‘discharge’’ means any release

however caused from a cruise vessel, and includes any escape,

disposal, spilling, leaking, pumping, emitting, or emptying.

(4) GRAYWATER.—The term ‘‘graywater’’ means only galley,

dishwasher, bath, and laundry waste water. The term does

not include other wastes or waste streams.

(5) NAVIGABLE WATERS.—The term ‘‘navigable waters’’ has

the same meaning as in section 502 of the Federal Water

Pollution Control Act, as amended.

(6) PERSON.—The term ‘‘person’’ means an individual, corporation, partnership, limited liability company, association,

State, municipality, commission, or political subdivision of a

State, or any federally recognized tribe.

(7) SECRETARY.—The term ‘‘Secretary’’ means the Secretary

of the department in which the United States Coast Guard

is operating.

(8) SEWAGE.—The term ‘‘sewage’’ means human body

wastes and the wastes from toilets and other receptacles

intended to receive or retain body waste.

(9) TREATED SEWAGE.—The term ‘‘treated sewage’’ means

sewage meeting all applicable effluent limitation standards and

processing requirements of the Federal Water Pollution Control

Act, as amended and of this title, and regulations promulgated

under either.

(10) UNTREATED SEWAGE.—The term ‘‘untreated sewage’’

means sewage that is not treated sewage.

(11) WATERS OF THE ALEXANDER ARCHIPELAGO.—The term

‘‘waters of the Alexander Archipelago’’ means all waters under

the sovereignty of the United States within or near Southeast

Alaska, beginning at a point 58°11′41′′N, 136°39′25′′W [near

Cape Spencer Light], thence southeasterly along a line three

nautical miles seaward of the baseline from which the breadth

of the territorial sea is measured in the Pacific Ocean and

the Dixon Entrance, except where this line intersects geodesics

connecting the following five pairs of points:

(1) 58°05′17′′N, 136°33′49′′W and 58°11′41′′N,

136°39′25′′W [Cross Sound].

(2) 56°09′40′′N, 134°40′00′′W and 55°49′15′′N,

134°17′40′′W [Chatham Strait].

(3) 55°49′15′′N, 134°17′40′′W and 55°50′30′′N,

133°54′15′′W [Sumner Strait].

(4) 54°41′30′′N, 132°01′00′′W and 54°51′′30′′N,

131°20′45′′W [Clarence Strait].

(5) 54°51′30′′N, 131°20′45′′W and 54°46′15′′N,

130°52′00′′W [Revillagigedo Channel].

The portion of each such geodesic situated beyond three nautical

miles from the baseline from which the breadth of the territorial

sea is measured forms the outer limit of the waters of the Alexander

Archipelago in those five locations.

114 STAT. 2763A–324 PUBLIC LAW 106–554—APPENDIX D

TITLE XV—LIFE ACT AMENDMENTS

SEC. 1501. SHORT TITLE.

This title may be cited as the ‘‘LIFE Act Amendments of 2000’’.

SEC. 1502. SUBSTITUTION OF ALTERNATIVE ADJUSTMENT PROVISION.

(a) EXTENDED APPLICATION OF SECTION 245(i).— (1) IN GENERAL.—Paragraph (1) of section 245(i) of the

Immigration and Nationality Act (8 U.S.C. 1255(i)) is

amended—

(A) in subparagraph (A), by striking ‘‘and’’ at the end;

(B) in subparagraph (B)(i), by striking ‘‘January 14,

1998’’ and inserting ‘‘April 30, 2001’’;

(C) in subparagraph (B), by adding ‘‘and’’ at the end;

and

(D) by inserting after subparagraph (B) the following

new subparagraph:

‘‘(C) who, in the case of a beneficiary of a petition for

classification, or an application for labor certification, described

in subparagraph (B) that was filed after January 14, 1998,

is physically present in the United States on the date of the

enactment of the LIFE Act Amendments of 2000;’’. (2) MODIFICATION IN USE OF FUNDS.—Paragraph (3)(B) of

such section is amended by inserting before the period the

following: ‘‘, except that in the case of fees attributable to

applications for a beneficiary with respect to whom a petition

for classification, or an application for labor certification,

described in paragraph (1)(B) was filed after January 14, 1998,

one-half of such remaining portion shall be deposited by the

Attorney General into the Immigration Examinations Fee

Account established under section 286(m)’’. (b) CONFORMING AMENDMENTS.— (1) Subsection (m) of section 245 of the Immigration and

Nationality Act, as added by section 1102(c) of the Legal

Immigration Family Equity Act, is repealed.

(2) Section 245 of the Immigration and Nationality Act,

as amended by section 1102(d)(2) of the Legal Immigration

Family Equity Act, is amended by striking ‘‘or (m)’’ each place

it appears.

SEC. 1503. MODIFICATION OF SECTION 1104 ADJUSTMENT PROVISIONS.

(a) INCLUSION OF ADDITIONAL CLASS.—Section 1104(b) of the

Legal Immigration Family Equity Act is amended—

(1) in paragraph (1), by striking ‘‘or’’ at the end;

(2) in paragraph (2), by striking the period at the end

and inserting ‘‘; or’’; and

(3) by adding at the end the following new paragraph:

‘‘(3) Zambrano v. INS, vacated sub nom. Immigration and

Naturalization Service v. Zambrano, 509 U.S. 918 (1993).’’.

(b) CONFORMING APPLICATION OF CONSENT PROVISION.—Section

1104(c) of the Legal Immigration Family Equity Act is amended

by adding at the end the following new paragraph:

‘‘(10) CONFORMING APPLICATION OF CONSENT PROVISION.—

In addition to the waivers provided in subsection (d)(2) of

such section 245A of the Immigration and Nationality Act,

the Attorney General may grant the alien a waiver of the

grounds of inadmissibility under subparagraphs (A) and (C)

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–325

of section 212(a)(9) of such Act (8 U.S.C. 1182(a)(9)). In granting

such waivers, the Attorney General shall use standards used

in granting consent under subparagraphs (A)(iii) and (C)(ii)

of such section.’’.

(c) INAPPLICABILITY OF REMOVAL ORDER REINSTATEMENT.—Section 1104 of such Act is further amended— (1) by redesignating subsection (g) as subsection (h); and

(2) by inserting after subsection (f ) the following new subsection:

‘‘(g) INAPPLICABILITY OF REMOVAL ORDER REINSTATEMENT.— Section 241(a)(5) of the Immigration and Nationality Act shall

not apply with respect to an alien who is applying for adjustment

of status under this section.’’.

SEC. 1504. APPLICATION OF FAMILY UNITY PROVISIONS TO SPOUSES

AND UNMARRIED CHILDREN OF CERTAIN LIFE ACT

BENEFICIARIES.

(a) IMMIGRATION BENEFITS.—Except as provided in subsection

(d), in the case of an eligible spouse or child (as described in

subsection (b)), the Attorney General—

(1) shall not remove the alien on a ground specified in

paragraph (1)(A), (1)(B), (1)(C), or (3)(A) of section 237(a) of

the Immigration and Nationality Act (8 U.S.C. 1227(a)), other

than so much of paragraph (1)(A) of such section as relates

to a ground of inadmissibility described in paragraph (2) or

(3) of section 212(a) of such Act (8 U.S.C. 1182(a)); and

(2) shall authorize the alien to engage in employment in

the United States during the period of time in which protection

is provided under paragraph (1) and shall provide the alien

with an ‘‘employment authorized’’ endorsement or other appropriate document signifying authorization of employment.

(b) ELIGIBLE SPOUSES AND CHILDREN.—For purposes of this

section, the term ‘‘eligible spouse or child’’ means an alien who

is the spouse or unmarried child of an alien described in section

1104(b) of the Legal Immigration Family Equity Act if the spouse

or child—

(1) entered the United States before December 1, 1988;

and

(2) resided in the United States on such date.

(c) PROCESS FOR RELIEF FOR ELIGIBLE SPOUSES AND CHILDREN

OUTSIDE THE UNITED STATES.—If an alien has obtained lawful

permanent resident status under section 1104 of the Legal Immigration Family Equity Act and the alien has an eligible spouse or

child who is no longer physically present in the United States,

the Attorney General shall establish a process under which the

eligible spouse or child may be paroled into the United States

in order to obtain the benefits of subsection (a) unless the Attorney

General finds that the spouse or child would be inadmissible or

deportable on any ground, other than a ground for which the

alien would not be subject to removal under subsection (a)(1). An

alien so paroled shall not be treated as paroled into the United

States for purposes of section 201(c)(4) of the Immigration and

Nationality Act (8 U.S.C. 1151(c)(4)).

(d) EXCEPTION.—An alien is not eligible for the benefits of

this section if the Attorney General finds that—

(1) the alien has been convicted of a felony or three or

more misdemeanors in the United States; or

114 STAT. 2763A–326 PUBLIC LAW 106–554—APPENDIX D

(2) the alien is described in section 241(b)(3)(B) of the

Immigration and Nationality Act (8 U.S.C. 1231(b)(3)(B)).

(e) APPLICATION OF DEFINITIONS.—Except as otherwise specifically provided in this section, the definitions contained in the

Immigration and Nationality Act shall apply in the administration

of this section.

SEC. 1505. MISCELLANEOUS AMENDMENTS TO VARIOUS ADJUSTMENT

AND RELIEF ACTS.

(a) NICARAGUAN ADJUSTMENT AND CENTRAL AMERICAN RELIEF

ACT.—

(1) IN GENERAL.—Section 202(a) of the Nicaraguan Adjustment and Central American Relief Act is amended—

(A) by redesignating paragraph (2) as paragraph (3);

and

(B) by inserting after paragraph (1) the following new

paragraph:

‘‘(2) RULES IN APPLYING CERTAIN PROVISIONS.—In the case

of an alien described in subsection (b) or (d) who is applying

for adjustment of status under this section—

‘‘(A) the provisions of section 241(a)(5) of the Immigration and Nationality Act shall not apply; and

‘‘(B) the Attorney General may grant the alien a waiver

on the grounds of inadmissibility under subparagraphs (A)

and (C) of section 212(a)(9) of such Act.

In granting waivers under subparagraph (B), the Attorney General shall use standards used in granting consent under subparagraphs (A)(iii) and (C)(ii) of such section 212(a)(9).’’.

(2) PERMITTING MOTION TO REOPEN.—Notwithstanding any

time and number limitations imposed by law on motions to

reopen exclusion, removal, or deportation proceedings (except

limitations premised on an alien’s conviction of an aggravated

felony (as defined by section 101(a) of the Immigration and

Nationality Act)), a national of Cuba or Nicaragua who has

become eligible for adjustment of status under the Nicaraguan

Adjustment and Central American Relief Act as a result of

the amendments made by paragraph (1), may file one motion

to reopen exclusion, deportation, or removal proceedings to

apply for such adjustment under that Act. The scope of any

proceeding reopened on this basis shall be limited to a determination of the alien’s eligibility for adjustment of status under

that Act. All such motions shall be filed within 180 days of

the date of the enactment of this Act.

(b) HAITIAN REFUGEE IMMIGRATION FAIRNESS ACT OF 1998.—

(1) INAPPLICABILITY OF CERTAIN PROVISIONS.—Section

902(a) of the Haitian Refugee Immigration Fairness Act of

1998 is amended—

(A) by redesignating paragraph (2) as paragraph (3);

and

(B) by inserting after paragraph (1) the following new

paragraph:

‘‘(2) INAPPLICABILITY OF CERTAIN PROVISIONS.—In the case

of an alien described in subsection (b) or (d) who is applying

for adjustment of status under this section—

‘‘(A) the provisions of section 241(a)(5) of the Immigration and Nationality Act shall not apply; and

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–327

‘‘(B) the Attorney General may grant the alien a waiver

on the grounds of inadmissibility under subparagraphs (A)

and (C) of section 212(a)(9) of such Act.

In granting waivers under subparagraph (B), the Attorney General shall use standards used in granting consent under subparagraphs (A)(iii) and (C)(ii) of such section 212(a)(9).’’.

(2) PERMITTING MOTION TO REOPEN.—Notwithstanding any

time and number limitations imposed by law on motions to

reopen exclusion, removal, or deportation proceedings (except

limitations premised on an alien’s conviction of an aggravated

felony (as defined by section 101(a) of the Immigration and

Nationality Act)), a national of Haiti who has become eligible

for adjustment of status under the Haitian Refugee Immigration Fairness Act of 1998 as a result of the amendments made

by paragraph (1), may file one motion to reopen exclusion,

deportation, or removal proceedings to apply for such adjustment under that Act. The scope of any proceeding reopened

on this basis shall be limited to a determination of the alien’s

eligibility for adjustment of status under that Act. All such

motions shall be filed within 180 days of the date of the enactment of this Act.

(c) SECTION 309 OF IIRIRA.—Section 309 of the Illegal Immigration Reform and Immigrant Responsibility Act of 1996 is amended

by adding at the end the following new subsection:

‘‘(h) RELIEF AND MOTIONS TO REOPEN.—

‘‘(1) RELIEF.—An alien described in subsection (c)(5)(C)(i)

who is otherwise eligible for—

‘‘(A) suspension of deportation pursuant to section

244(a) of the Immigration and Nationality Act, as in effect

before the title III–A effective date; or

‘‘(B) cancellation of removal, pursuant to section

240A(b) of the Immigration and Nationality Act and subsection (f ) of this section;

shall not be barred from applying for such relief by operation

of section 241(a)(5) of the Immigration and Nationality Act,

as in effect after the title III–A effective date.

‘‘(2) ADDITIONAL MOTION TO REOPEN PERMITTED.—Notwithstanding any limitation imposed by law on motions to reopen

removal or deportation proceedings (except limitations premised

on an alien’s conviction of an aggravated felony (as defined

by section 101(a) of the Immigration and Nationality Act)),

any alien who is described in subsection (c)(5)(C)(i) and who

has become eligible for cancellation of removal or suspension

of deportation as a result of the enactment of paragraph (1)

may file one motion to reopen removal or deportation proceedings in order to apply for cancellation of removal or suspension

of deportation. The scope of any proceeding reopened on this

basis shall be limited to a determination of the alien’s eligibility

for cancellation of removal or suspension of deportation. The

Attorney General shall designate a specific time period in which

all such motions to reopen are required to be filed. The period

shall begin not later than 60 days after the date of the enactment of this subsection and shall extend for a period not to

exceed 240 days.

‘‘(3) CONSTRUCTION.—Nothing in this subsection shall preclude an alien from filing a motion to reopen pursuant to

section 240(b)(5)(C)(ii) of the Immigration and Nationality Act,

114 STAT. 2763A–328 PUBLIC LAW 106–554—APPENDIX D

or section 242B(c)(3)(B) of such Act (as in effect before the

title III–A effective date).’’.

SEC. 1506. EFFECTIVE DATE.

This title shall take effect as if included in the enactment

of the Legal Immigration Family Equity Act.

TITLE XVI—IMPROVING LITERACY THROUGH FAMILY

LITERACY PROJECTS

SEC. 1601. SHORT TITLE.

This title may be cited as the ‘‘Literacy Involves Families

Together Act’’.

SEC. 1602. AUTHORIZATION OF APPROPRIATIONS.

Section 1002(b) of the Elementary and Secondary Education

Act of 1965 (20 U.S.C. 6302(b)) is amended by striking

‘‘$118,000,000 for fiscal year 1995’’ and inserting ‘‘$250,000,000

for fiscal year 2001’’.

SEC. 1603. IMPROVING BASIC PROGRAMS OPERATED BY LOCAL EDUCATIONAL AGENCIES.

Section 1111(c) of the Elementary and Secondary Education

Act of 1965 (20 U.S.C. 6311(c)) is amended—

(1) in paragraph (5), by striking ‘‘and’’ at the end;

(2) in paragraph (6), by striking the period at the end

and inserting ‘‘; and’’; and

(3) by adding at the end the following:

‘‘(7) the State educational agency will encourage local educational agencies and individual schools participating in a program assisted under this part to offer family literacy services

(using funds under this part), if the agency or school determines

that a substantial number of students served under this part

by the agency or school have parents who do not have a high

school diploma or its recognized equivalent or who have low

levels of literacy.’’.

SEC. 1604. EVEN START FAMILY LITERACY PROGRAMS.

(a) PART HEADING.—The part heading for part B of title I

of the Elementary and Secondary Education Act of 1965 (20 U.S.C.

6361 et seq.) is amended to read as follows:

‘‘PART B—WILLIAM F. GOODLING EVEN START

FAMILY LITERACY PROGRAMS’’.

(b) STATEMENT OF PURPOSE.—Section 1201 of the Elementary

and Secondary Education Act of 1965 (20 U.S.C. 6361) is amended—

(1) in paragraph (1), by inserting ‘‘high quality’’ after ‘‘build

on’’; and

(2) by amending paragraph (2) to read as follows:

‘‘(2) promote the academic achievement of children and

adults;’’;

(3) by striking the period at the end of paragraph (3)

and inserting ‘‘; and’’; and

(4) by adding at the end the following:

‘‘(4) use instructional programs based on scientifically based

reading research (as defined in section 2252) and the prevention

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–329

of reading difficulties for children and adults, to the extent

such research is available.’’. (c) PROGRAM AUTHORIZED.—

(1) RESERVATION FOR MIGRANT PROGRAMS, OUTLYING AREAS, AND INDIAN TRIBES.—Section 1202(a) of the Elementary and

Secondary Education Act of 1965 (20 U.S.C. 6362(a)) is

amended—

(A) in paragraph (1), in the matter preceding subparagraph (A), by inserting ‘‘(or, if such appropriated amount exceeds $200,000,000, 6 percent of such amount)’’ after ‘‘1002(b)’’;

(B) in paragraph (2), by striking ‘‘If the amount of

funds made available under this subsection exceeds

$4,600,000,’’ and inserting ‘‘After the date of the enactment

of the Literacy Involves Families Together Act,’’; and

(C) by adding at the end the following: ‘‘(3) COORDINATION OF PROGRAMS FOR AMERICAN INDIANS.—

The Secretary shall ensure that programs under paragraph

(1)(C) are coordinated with family literacy programs operated

by the Bureau of Indian Affairs in order to avoid duplication

and to encourage the dissemination of information on high

quality family literacy programs serving American Indians.’’.

(2) RESERVATION FOR FEDERAL ACTIVITIES.—Section 1202(b)

of the Elementary and Secondary Education Act of 1965 (20

U.S.C. 6362(b)) is amended to read as follows:

‘‘(b) RESERVATION FOR FEDERAL ACTIVITIES.—

‘‘(1) EVALUATION, TECHNICAL ASSISTANCE, PROGRAM

IMPROVEMENT, AND REPLICATION ACTIVITIES.—From amounts

appropriated under section 1002(b), the Secretary may reserve

not more than 3 percent of such amounts for purposes of—

‘‘(A) carrying out the evaluation required by section

1209; and

‘‘(B) providing, through grants or contracts with eligible

organizations, technical assistance, program improvement,

and replication activities.

‘‘(2) RESEARCH.—In the case of fiscal years 2001 through

2004, if the amount appropriated under section 1002(b) for

any of such years—

‘‘(A) is equal to or less than the amounts appropriated

for the preceding fiscal year, the Secretary may reserve

from such amount only the amount necessary to continue

multiyear activities carried out pursuant to section 1211(b)

that began during or prior to the preceding fiscal year;

or

‘‘(B) exceeds the amount appropriated for the preceding

fiscal year, the Secretary shall reserve from such excess

amount $2,000,000 or 50 percent, whichever is less, to

carry out section 1211(b).’’.

(d) RESERVATION FOR GRANTS.—Section 1202(c)(1) of the

Elementary and Secondary Education Act of 1965 (20 U.S.C.

6362(c)(1)) is amended— (1) by striking ‘‘From funds reserved under section

2260(b)(3), the Secretary shall award grants,’’ and inserting

‘‘For any fiscal year for which at least one State applies and

submits an application that meets the requirements and goals

of this subsection and for which the amount appropriated under

section 1002(b) exceeds the amount appropriated under such

114 STAT. 2763A–330 PUBLIC LAW 106–554—APPENDIX D

section for the preceding fiscal year, the Secretary shall reserve,

from the amount of such excess remaining after the application

of subsection (b)(2), the amount of such remainder or

$1,000,000, whichever is less, to award grants,’’; and

(2) by adding at the end ‘‘No State may receive more

than one grant under this subsection.’’.

(e) ALLOCATIONS.—Section 1202(d)(2) of the Elementary and

Secondary Education Act of 1965 (20 U.S.C. 6362(d)(2)) is amended

by striking ‘‘that section’’ and inserting ‘‘that part’’. (f ) STATE LEVEL ACTIVITIES.—Section 1203(a) of the Elementary

and Secondary Education Act of 1965 (20 U.S.C. 6363(a)) is

amended—

(1) by striking ‘‘5 percent’’ and inserting ‘‘a total of 6

percent’’; and

(2) in paragraph (1), by inserting before the semicolon

the following: ‘‘, not to exceed half of such total’’. (g) SUBGRANTS FOR LOCAL PROGRAMS.—Section 1203(b)(2) of

the Elementary and Secondary Education Act of 1965 (20 U.S.C.

6363(b)(2)) is amended to read as follows:

‘‘(2) MINIMUM SUBGRANT AMOUNTS.—

‘‘(A) IN GENERAL.—Except as provided in subparagraphs (B) and (C), no State shall award a subgrant under

paragraph (1) in an amount less than $75,000.

‘‘(B) SUBGRANTEES IN NINTH AND SUCCEEDING YEARS.—

No State shall award a subgrant under paragraph (1) in

an amount less than $52,500 to an eligible entity for a

fiscal year to carry out an Even Start program that is

receiving assistance under this part or its predecessor

authority for the ninth (or any subsequent) fiscal year.

‘‘(C) EXCEPTION FOR SINGLE SUBGRANT.—A State may

award one subgrant in each fiscal year of sufficient size,

scope, and quality to be effective in an amount less than

$75,000 if, after awarding subgrants under paragraph (1)

for such fiscal year in accordance with subparagraphs (A)

and (B), less than $75,000 is available to the State to

award such subgrants.’’.

(h) USES OF FUNDS.—Section 1204 of the Elementary and

Secondary Education Act of 1965 (20 U.S.C. 6364) is amended—

(1) in subsection (a), by striking ‘‘family-centered education

programs’’ and inserting ‘‘family literacy services’’; and

(2) by adding at the end the following:

‘‘(c) USE OF FUNDS FOR FAMILY LITERACY SERVICES.—

‘‘(1) IN GENERAL.—From funds reserved under section

1203(a), a State may use a portion of such funds to assist

eligible entities receiving a subgrant under section 1203(b) in

improving the quality of family literacy services provided under

Even Start programs under this part, except that in no case

may a State’s use of funds for this purpose for a fiscal year

result in a decrease from the level of activities and services

provided to program participants in the preceding year.

‘‘(2) PRIORITY.—In carrying out paragraph (1), a State shall

give priority to programs that were of low quality, as evaluated

based on the indicators of program quality developed by the

State under section 1210.

‘‘(3) TECHNICAL ASSISTANCE TO HELP LOCAL PROGRAMS RAISE

ADDITIONAL FUNDS.—In carrying out paragraph (1), a State

may use the funds referred to in such paragraph to provide

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–331

technical assistance to help local programs of demonstrated

effectiveness to access and leverage additional funds for the

purpose of expanding services and reducing waiting lists,

including requesting and applying for non-Federal resources.

‘‘(4) TECHNICAL ASSISTANCE AND TRAINING.—Assistance

under paragraph (1) shall be in the form of technical assistance

and training, provided by a State through a grant, contract,

or cooperative agreement with an entity that has experience

in offering high quality training and technical assistance to

family literacy providers.’’.

(i) PROGRAM ELEMENTS.—Section 1205 of the Elementary and

Secondary Education Act of 1965 (20 U.S.C. 6365) is amended—

(1) by redesignating paragraphs (9) and (10) as paragraphs

(14) and (15), respectively;

(2) by redesignating paragraphs (5) through (8) as paragraphs (6) through (9), respectively;

(3) by inserting after paragraph (4) the following:

‘‘(5) with respect to the qualifications of staff the cost

of whose salaries are paid, in whole or in part, with Federal

funds provided under this part, ensure that—

‘‘(A) not later than 4 years after the date of the enactment of the Literacy Involves Families Together Act—

‘‘(i) a majority of the individuals providing academic instruction—

‘‘(I) shall have obtained an associate’s, bachelor’s, or graduate degree in a field related to

early childhood education, elementary or secondary

school education, or adult education; and

‘‘(II) if applicable, shall meet qualifications

established by the State for early childhood education, elementary or secondary school education,

or adult education provided as part of an Even

Start program or another family literacy program;

‘‘(ii) the individual responsible for administration

of family literacy services under this part has received

training in the operation of a family literacy program;

and

‘‘(iii) paraprofessionals who provide support for

academic instruction have a high school diploma or

its recognized equivalent; and

‘‘(B) beginning on the date of the enactment of the

Literacy Involves Families Together Act, all new personnel

hired to provide academic instruction—

‘‘(i) have obtained an associate’s, bachelor’s, or

graduate degree in a field related to early childhood

education, elementary or secondary school education,

or adult education; and

‘‘(ii) if applicable, meet qualifications established

by the State for early childhood education, elementary

or secondary school education, or adult education provided as part of an Even Start program or another

family literacy program;’’;

(4) in paragraph (8) (as so redesignated by paragraph (2),

by striking ‘‘or enrichment’’ and inserting ‘‘and enrichment’’.

(5) by inserting after paragraph (9) (as so redesignated

by paragraph (2)) the following:

114 STAT. 2763A–332 PUBLIC LAW 106–554—APPENDIX D

‘‘(10) use instructional programs based on scientifically

based reading research (as defined in section 2252) for children

and adults, to the extent such research is available; ‘‘(11) encourage participating families to attend regularly

and to remain in the program a sufficient time to meet their

program goals;

‘‘(12) include reading readiness activities for preschool children based on scientifically based reading research (as defined

in section 2252), to the extent available, to ensure children

enter school ready to learn to read;

‘‘(13) if applicable, promote the continuity of family literacy

to ensure that individuals retain and improve their educational

outcomes’’; and

(5) in paragraph (14) (as so redesignated), by striking ‘‘program.’’ and inserting ‘‘program to be used for program improvement.’’.

( j) ELIGIBLE PARTICIPANTS.—Section 1206 of the Elementary

and Secondary Education Act of 1965 (20 U.S.C. 6366) is amended—

(1) in subsection (a)(1)(B) by striking ‘‘part;’’ and inserting

‘‘part, or who are attending secondary school;’’; and

(2) in subsection (b), by adding at the end the following:

‘‘(3) CHILDREN 8 YEARS OF AGE OR OLDER.—If an Even

Start program assisted under this part collaborates with a

program under part A, and funds received under such part

A program contribute to paying the cost of providing programs

under this part to children 8 years of age or older, the Even

Start program, notwithstanding subsection (a)(2), may permit

the participation of children 8 years of age or older if the

focus of the program continues to remain on families with

young children.’’.

(k) PLAN.—Section 1207(c) of the Elementary and Secondary

Education Act of 1965 (20 U.S.C. 6367(c)) is amended—

(1) in paragraph (1)—

(A) in the matter preceding subparagraph (A), by

inserting ‘‘and continuous improvement’’ after ‘‘plan of operation’’;

(B) in subparagraph (A), by striking ‘‘goals;’’ and inserting ‘‘objectives, strategies to meet such objectives, and how

they are consistent with the program indicators established

by the State;’’;

(C) in subparagraph (E), by striking ‘‘and’’ at the end;

(D) in subparagraph (F)—

(i) by striking ‘‘Act, the Goals 2000: Educate America Act,’’ and inserting ‘‘Act’’; and

(ii) by striking the period at the end and inserting

‘‘; and’’; and

(E) by adding at the end the following:

‘‘(G) a description of how the plan provides for rigorous

and objective evaluation of progress toward the program

objectives described in subparagraph (A) and for continuing

use of evaluation data for program improvement.’’; and

(2) in paragraph (2), in the matter preceding subparagraph

(A), by striking ‘‘(1)(A)’’ and inserting ‘‘(1)’’.

(l) AWARD OF SUBGRANTS.—Section 1208 of the Elementary

and Secondary Education Act of 1965 (20 U.S.C. 6368) is amended—

(1) in subsection (a)—

(A) in paragraph (1)(B)—

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–333

(i) by striking ‘‘including a high’’ and inserting

‘‘such as a high’’; and

(ii) by striking ‘‘part A;’’ and inserting ‘‘part A,

a high number or percentage of parents who have

been victims of domestic violence, or a high number

or percentage of parents who are receiving assistance

under a State program funded under part A of title

IV of the Social Security Act (42 U.S.C. 601 et seq.);’’;

(B) in paragraph (1)(F), by striking ‘‘Federal’’ and

inserting ‘‘non-Federal’’;

(C) in paragraph (1)(H), by inserting ‘‘family literacy

projects and other’’ before ‘‘local educational agencies’’; and

(D) in paragraph (3), in the matter preceding subparagraph (A), by striking ‘‘one or more of the following individuals:’’ and inserting ‘‘one individual with expertise in family

literacy programs, and may include other individuals, such

as one or more of the following:’’; and

(2) in subsection (b)—

(A) by striking paragraph (3) and inserting the following:

‘‘(3) CONTINUING ELIGIBILITY.—In awarding subgrant funds

to continue a program under this part after the first year,

the State educational agency shall review the progress of each

eligible entity in meeting the objectives of the program referred

to in section 1207(c)(1)(A) and shall evaluate the program based

on the indicators of program quality developed by the State

under section 1210.’’; and

(B) by amending paragraph (5)(B) to read as follows:

‘‘(B) The Federal share of any subgrant renewed under

subparagraph (A) shall be limited in accordance with section

1204(b).’’.

(m) RESEARCH.—Section 1211 of the Elementary and Secondary

Education Act of 1965 (20 U.S.C. 6369b) is amended—

(1) in subsection (b), by striking ‘‘subsection (a)’’ and inserting ‘‘subsections (a) and (b)’’;

(2) by redesignating subsection (b) as subsection (c); and

(3) by inserting after subsection (a) the following:

‘‘(b) SCIENTIFICALLY BASED RESEARCH ON FAMILY LITERACY.—

‘‘(1) IN GENERAL.—From amounts reserved under section

1202(b)(2), the National Institute for Literacy, in consultation

with the Secretary, shall carry out research that—

‘‘(A) is scientifically based reading research (as defined

in section 2252); and

‘‘(B) determines—

‘‘(i) the most effective ways of improving the literacy skills of adults with reading difficulties; and

‘‘(ii) how family literacy services can best provide

parents with the knowledge and skills they need to

support their children’s literacy development.

‘‘(2) USE OF EXPERT ENTITY.—The National Institute for

Literacy, in consultation with the Secretary, shall carry out

the research under paragraph (1) through an entity, including

a Federal agency, that has expertise in carrying out longitudinal

studies of the development of literacy skills in children and

has developed effective interventions to help children with reading difficulties.’’.

114 STAT. 2763A–334 PUBLIC LAW 106–554—APPENDIX D

(n) INDICATORS OF PROGRAM QUALITY.—Not later than 30 days

after the date of the enactment of this Act, the Secretary shall

notify each State that receives funds under part B of title I of

the Elementary and Secondary Education Act of 1965 that to be

eligible to receive fiscal year 2001 funds under part B, such State

shall submit to the Secretary, not later than June 30, 2001, its

indicators of program quality as described in section 1210 of the

Elementary and Secondary Education Act of 1965. A State that

fails to comply with this subsection shall be ineligible to receive

funds under such part in subsequent years unless such State submits to the Secretary, not later than June 30 of the year in which

funds are requested, its indicators of program quality as described

in section 1210 of the Elementary and Secondary Education Act

of 1965.

SEC. 1605. EDUCATION OF MIGRATORY CHILDREN.

Section 1304(b) of the Elementary and Secondary Education

Act of 1965 (20 U.S.C. 6394(b)) is amended—

(1) in paragraph (5), by striking ‘‘and’’ at the end;

(2) in paragraph (6), by striking the period at the end

and inserting ‘‘; and’’; and

(3) by adding at the end the following:

‘‘(7) a description of how the State will encourage programs

and projects assisted under this part to offer family literacy

services if the program or project serves a substantial number

of migratory children who have parents who do not have a

high school diploma or its recognized equivalent or who have

low levels of literacy.’’.

SEC. 1606. DEFINITIONS.

(a) IN GENERAL.—Section 14101 of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 8801) is amended—

(1) by redesignating paragraphs (15) through (29) as paragraphs (16) through (30), respectively; and

(2) by inserting after paragraph (14) the following:

‘‘(15) FAMILY LITERACY SERVICES.—The term ‘family literacy

services’ means services provided to participants on a voluntary

basis that are of sufficient intensity in terms of hours, and

of sufficient duration, to make sustainable changes in a family,

and that integrate all of the following activities:

‘‘(A) Interactive literacy activities between parents and

their children.

‘‘(B) Training for parents regarding how to be the primary teacher for their children and full partners in the

education of their children.

‘‘(C) Parent literacy training that leads to economic

self-sufficiency.

‘‘(D) An age-appropriate education to prepare children

for success in school and life experiences.’’.

(b) CONFORMING AMENDMENTS.—

(1) EVEN START FAMILY LITERACY PROGRAMS.—Section

1202(e) of the Elementary and Secondary Education Act of

1965 (20 U.S.C. 6362(e)) is amended—

(A) by striking paragraph (3); and

(B) by redesignating paragraphs (4) and (5) as paragraphs (3) and (4), respectively.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–335

(2) READING AND LITERACY GRANTS.—(A) Section 2252 of

the Elementary and Secondary Education Act of 1965 (20 U.S.C.

6661a) is amended— (i) by striking paragraph (2); and

(ii) by redesignating paragraphs (3) through (5) as

paragraphs (2) through (4), respectively.

(B) Section 2260 of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 6661i) is amendmed— (i) in subsection (a), by striking ‘‘and section 1202(c)’’ each place it appears, and

(ii) in subsection (b)— (I) in paragraph (1), by inserting ‘‘and’’ after the

semicolon;

(II) in paragraph (2), by striking ‘‘; and ’’ and

inserting a period; and

(III) by striking paragraph (3).

SEC. 1607. INDIAN EDUCATION.

(a) EARLY CHILDHOOD DEVELOPMENT PROGRAM.—Section 1143

of the Education Amendments of 1978 (25 U.S.C. 2023) is

amended—

(1) in subsection (b)(1), in the matter preceding subparagraph (A)—

(A) by striking ‘‘(f )’’ and inserting ‘‘(g)’’; and

(B) by striking ‘‘(e))’’ and inserting ‘‘(f ))’’;

(2) in subsection (d)(1)—

(A) by redesignating subparagraphs (D) and (E) as

subparagraphs (E) and (F), respectively; and

(B) by inserting after subparagraph (C) the following:

‘‘(D) family literacy services,’’;

(3) in subsection (e), by striking ‘‘(f ),’’ and inserting ‘‘(g),’’;

(4) by redesignating subsections (e) and (f ) as subsections

(f ) and (g), respectively; and

(5) by inserting after subsection (d) the following:

‘‘(e) Family literacy programs operated under this section, and

other family literacy programs operated by the Bureau of Indian

Affairs, shall be coordinated with family literacy programs for American Indian children under part B of title I of the Elementary

and Secondary Education Act of 1965 in order to avoid duplication

and to encourage the dissemination of information on quality family

literacy programs serving American Indians.’’.

(b) DEFINITIONS.—Section 1146 of the Education Amendments

of 1978 (25 U.S.C. 2026) is amended—

(1) by redesignating paragraphs (7) through (14) as paragraphs (8) through (15), respectively; and

(2) by inserting after paragraph (6) the following:

‘‘(7) the term ‘family literacy services’ has the meaning

given such term in section 14101 of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 8801);’’.

TITLE XVII—CHILDREN’S INTERNET

PROTECTION

SEC. 1701. SHORT TITLE.

This title may be cited as the ‘‘Children’s Internet Protection

Act’’.

114 STAT. 2763A–336 PUBLIC LAW 106–554—APPENDIX D

SEC. 1702. DISCLAIMERS.

(a) DISCLAIMER REGARDING CONTENT.—Nothing in this title

or the amendments made by this title shall be construed to prohibit

a local educational agency, elementary or secondary school, or

library from blocking access on the Internet on computers owned

or operated by that agency, school, or library to any content other

than content covered by this title or the amendments made by

this title.

(b) DISCLAIMER REGARDING PRIVACY.—Nothing in this title or

the amendments made by this title shall be construed to require

the tracking of Internet use by any identifiable minor or adult

user.

SEC. 1703. STUDY OF TECHNOLOGY PROTECTION MEASURES.

(a) IN GENERAL.—Not later than 18 months after the date

of the enactment of this Act, the National Telecommunications

and Information Administration shall initiate a notice and comment

proceeding for purposes of—

(1) evaluating whether or not currently available technology

protection measures, including commercial Internet blocking

and filtering software, adequately addresses the needs of educational institutions;

(2) making recommendations on how to foster the development of measures that meet such needs; and

(3) evaluating the development and effectiveness of local

Internet safety policies that are currently in operation after

community input.

(b) DEFINITIONS.—In this section:

(1) TECHNOLOGY PROTECTION MEASURE.—The term ‘‘technology protection measure’’ means a specific technology that

blocks or filters Internet access to visual depictions that are—

(A) obscene, as that term is defined in section 1460

of title 18, United States Code;

(B) child pornography, as that term is defined in section

2256 of title 18, United States Code; or

(C) harmful to minors.

(2) HARMFUL TO MINORS.—The term ‘‘harmful to minors’’

means any picture, image, graphic image file, or other visual

depiction that—

(A) taken as a whole and with respect to minors,

appeals to a prurient interest in nudity, sex, or excretion;

(B) depicts, describes, or represents, in a patently offensive way with respect to what is suitable for minors, an

actual or simulated sexual act or sexual contact, actual

or simulated normal or perverted sexual acts, or a lewd

exhibition of the genitals; and

(C) taken as a whole, lacks serious literary, artistic,

political, or scientific value as to minors.

(3) SEXUAL ACT; SEXUAL CONTACT.—The terms ‘‘sexual act’’

and ‘‘sexual contact’’ have the meanings given such terms in

section 2246 of title 18, United States Code.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–337

Subtitle A—Federal Funding for

Educational Institution Computers

SEC. 1711. LIMITATION ON AVAILABILITY OF CERTAIN FUNDS FOR

SCHOOLS.

Title III of the Elementary and Secondary Education Act of

1965 (20 U.S.C. 6801 et seq.) is amended by adding at the end

the following:

‘‘PART F—LIMITATION ON AVAILABILITY OF

CERTAIN FUNDS FOR SCHOOLS

‘‘SEC. 3601. LIMITATION ON AVAILABILITY OF CERTAIN FUNDS FOR

SCHOOLS.

‘‘(a) INTERNET SAFETY.—

‘‘(1) IN GENERAL.—No funds made available under this

title to a local educational agency for an elementary or secondary school that does not receive services at discount rates

under section 254(h)(5) of the Communications Act of 1934,

as added by section 1721 of Children’s Internet Protection

Act, may be used to purchase computers used to access the

Internet, or to pay for direct costs associated with accessing

the Internet, for such school unless the school, school board,

local educational agency, or other authority with responsibility

for administration of such school both—

‘‘(A)(i) has in place a policy of Internet safety for minors

that includes the operation of a technology protection measure with respect to any of its computers with Internet

access that protects against access through such computers

to visual depictions that are—

‘‘(I) obscene;

‘‘(II) child pornography; or

‘‘(III) harmful to minors; and

‘‘(ii) is enforcing the operation of such technology

protection measure during any use of such computers by

minors; and

‘‘(B)(i) has in place a policy of Internet safety that

includes the operation of a technology protection measure

with respect to any of its computers with Internet access

that protects against access through such computers to

visual depictions that are—

‘‘(I) obscene; or

‘‘(II) child pornography; and

‘‘(ii) is enforcing the operation of such technology

protection measure during any use of such computers.

‘‘(2) TIMING AND APPLICABILITY OF IMPLEMENTATION.—

‘‘(A) IN GENERAL.—The local educational agency with

responsibility for a school covered by paragraph (1) shall

certify the compliance of such school with the requirements

of paragraph (1) as part of the application process for

the next program funding year under this Act following

the effective date of this section, and for each subsequent

program funding year thereafter.

‘‘(B) PROCESS.—

114 STAT. 2763A–338 PUBLIC LAW 106–554—APPENDIX D

‘‘(i) SCHOOLS WITH INTERNET SAFETY POLICIES AND

TECHNOLOGY PROTECTION MEASURES IN PLACE.—A local

educational agency with responsibility for a school covered by paragraph (1) that has in place an Internet

safety policy meeting the requirements of paragraph

(1) shall certify its compliance with paragraph (1) during each annual program application cycle under this

Act.

‘‘(ii) SCHOOLS WITHOUT INTERNET SAFETY POLICIES

AND TECHNOLOGY PROTECTION MEASURES IN PLACE.— A local educational agency with responsibility for a

school covered by paragraph (1) that does not have

in place an Internet safety policy meeting the requirements of paragraph (1)— ‘‘(I) for the first program year after the effective date of this section in which the local educational agency is applying for funds for such

school under this Act, shall certify that it is undertaking such actions, including any necessary

procurement procedures, to put in place an Internet safety policy that meets such requirements;

and ‘‘(II) for the second program year after the

effective date of this section in which the local

educational agency is applying for funds for such

school under this Act, shall certify that such school

is in compliance with such requirements.

Any school covered by paragraph (1) for which the

local educational agency concerned is unable to certify

compliance with such requirements in such second program year shall be ineligible for all funding under

this title for such second program year and all subsequent program years until such time as such school

comes into compliance with such requirements.

‘‘(iii) WAIVERS.—Any school subject to a certification under clause (ii)(II) for which the local educational agency concerned cannot make the certification otherwise required by that clause may seek

a waiver of that clause if State or local procurement

rules or regulations or competitive bidding requirements prevent the making of the certification otherwise

required by that clause. The local educational agency

concerned shall notify the Secretary of the applicability

of that clause to the school. Such notice shall certify

that the school will be brought into compliance with

the requirements in paragraph (1) before the start

of the third program year after the effective date of

this section in which the school is applying for funds

under this title.

‘‘(3) DISABLING DURING CERTAIN USE.—An administrator,

supervisor, or person authorized by the responsible authority

under paragraph (1) may disable the technology protection

measure concerned to enable access for bona fide research

or other lawful purposes.

‘‘(4) NONCOMPLIANCE.— ‘‘(A) USE OF GENERAL EDUCATION PROVISIONS ACT REM- EDIES.—Whenever the Secretary has reason to believe that

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–339

any recipient of funds under this title is failing to comply

substantially with the requirements of this subsection, the

Secretary may— ‘‘(i) withhold further payments to the recipient

under this title,

‘‘(ii) issue a complaint to compel compliance of

the recipient through a cease and desist order, or

‘‘(iii) enter into a compliance agreement with a

recipient to bring it into compliance with such requirements,

in same manner as the Secretary is authorized to take

such actions under sections 455, 456, and 457, respectively,

of the General Education Provisions Act (20 U.S.C. 1234d).

‘‘(B) RECOVERY OF FUNDS PROHIBITED.—The actions

authorized by subparagraph (A) are the exclusive remedies

available with respect to the failure of a school to comply

substantially with a provision of this subsection, and the

Secretary shall not seek a recovery of funds from the recipient for such failure. ‘‘(C) RECOMMENCEMENT OF PAYMENTS.—Whenever the

Secretary determines (whether by certification or other

appropriate evidence) that a recipient of funds who is subject to the withholding of payments under subparagraph

(A)(i) has cured the failure providing the basis for the

withholding of payments, the Secretary shall cease the

withholding of payments to the recipient under that

subparagraph.

‘‘(5) DEFINITIONS.—In this section:

‘‘(A) COMPUTER.—The term ‘computer’ includes any

hardware, software, or other technology attached or connected to, installed in, or otherwise used in connection

with a computer.

‘‘(B) ACCESS TO INTERNET.—A computer shall be considered to have access to the Internet if such computer is

equipped with a modem or is connected to a computer

network which has access to the Internet.

‘‘(C) ACQUISITION OR OPERATION.—A elementary or

secondary school shall be considered to have received funds

under this title for the acquisition or operation of any

computer if such funds are used in any manner, directly

or indirectly—

‘‘(i) to purchase, lease, or otherwise acquire or

obtain the use of such computer; or

‘‘(ii) to obtain services, supplies, software, or other

actions or materials to support, or in connection with,

the operation of such computer.

‘‘(D) MINOR.—The term ‘minor’ means an individual

who has not attained the age of 17.

‘‘(E) CHILD PORNOGRAPHY.—The term ‘child pornography’ has the meaning given such term in section 2256

of title 18, United States Code. ‘‘(F) HARMFUL TO MINORS.—The term ‘harmful to

minors’ means any picture, image, graphic image file, or

other visual depiction that—

‘‘(i) taken as a whole and with respect to minors,

appeals to a prurient interest in nudity, sex, or excretion;

114 STAT. 2763A–340 PUBLIC LAW 106–554—APPENDIX D

‘‘(ii) depicts, describes, or represents, in a patently

offensive way with respect to what is suitable for

minors, an actual or simulated sexual act or sexual

contact, actual or simulated normal or perverted sexual

acts, or a lewd exhibition of the genitals; and

‘‘(iii) taken as a whole, lacks serious literary, artistic, political, or scientific value as to minors.

‘‘(G) OBSCENE.—The term ‘obscene’ has the meaning

given such term in section 1460 of title 18, United States

Code.

‘‘(H) SEXUAL ACT; SEXUAL CONTACT.—The terms ‘sexual

act’ and ‘sexual contact’ have the meanings given such

terms in section 2246 of title 18, United States Code.

‘‘(b) EFFECTIVE DATE.—This section shall take effect 120 days

after the date of the enactment of the Children’s Internet Protection

Act.

‘‘(c) SEPARABILITY.—If any provision of this section is held

invalid, the remainder of this section shall not be affected thereby.’’.

SEC. 1712. LIMITATION ON AVAILABILITY OF CERTAIN FUNDS FOR

LIBRARIES.

(a) AMENDMENT.—Section 224 of the Museum and Library Services Act (20 U.S.C. 9134(b)) is amended—

(1) in subsection (b)—

(A) by redesignating paragraph (6) as paragraph (7);

and

(B) by inserting after paragraph (5) the following new

paragraph:

‘‘(6) provide assurances that the State will comply with

subsection (f ); and’’; and

(2) by adding at the end the following new subsection:

‘‘(f ) INTERNET SAFETY.—

‘‘(1) IN GENERAL.—No funds made available under this

Act for a library described in section 213(2)(A) or (B) that

does not receive services at discount rates under section

254(h)(6) of the Communications Act of 1934, as added by

section 1721 of this Children’s Internet Protection Act, may

be used to purchase computers used to access the Internet,

or to pay for direct costs associated with accessing the Internet,

for such library unless—

‘‘(A) such library—

‘‘(i) has in place a policy of Internet safety for

minors that includes the operation of a technology

protection measure with respect to any of its computers

with Internet access that protects against access

through such computers to visual depictions that are—

‘‘(I) obscene;

‘‘(II) child pornography; or

‘‘(III) harmful to minors; and

‘‘(ii) is enforcing the operation of such technology

protection measure during any use of such computers

by minors; and

‘‘(B) such library—

‘‘(i) has in place a policy of Internet safety that

includes the operation of a technology protection measure with respect to any of its computers with Internet

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–341

access that protects against access through such

computers to visual depictions that are— ‘‘(I) obscene; or

‘‘(II) child pornography; and ‘‘(ii) is enforcing the operation of such technology

protection measure during any use of such computers. ‘‘(2) ACCESS TO OTHER MATERIALS.—Nothing in this subsection shall be construed to prohibit a library from limiting

Internet access to or otherwise protecting against materials

other than those referred to in subclauses (I), (II), and (III)

of paragraph (1)(A)(i). ‘‘(3) DISABLING DURING CERTAIN USE.—An administrator,

supervisor, or other authority may disable a technology protection measure under paragraph (1) to enable access for bona

fide research or other lawful purposes. ‘‘(4) TIMING AND APPLICABILITY OF IMPLEMENTATION.— ‘‘(A) IN GENERAL.—A library covered by paragraph (1)

shall certify the compliance of such library with the requirements of paragraph (1) as part of the application process

for the next program funding year under this Act following

the effective date of this subsection, and for each subsequent program funding year thereafter.

‘‘(B) PROCESS.—

‘‘(i) LIBRARIES WITH INTERNET SAFETY POLICIES AND

TECHNOLOGY PROTECTION MEASURES IN PLACE.—A

library covered by paragraph (1) that has in place

an Internet safety policy meeting the requirements

of paragraph (1) shall certify its compliance with paragraph (1) during each annual program application cycle

under this Act.

‘‘(ii) LIBRARIES WITHOUT INTERNET SAFETY POLICIES

AND TECHNOLOGY PROTECTION MEASURES IN PLACE.—

A library covered by paragraph (1) that does not have

in place an Internet safety policy meeting the requirements of paragraph (1)—

‘‘(I) for the first program year after the effective date of this subsection in which the library

applies for funds under this Act, shall certify that

it is undertaking such actions, including any necessary procurement procedures, to put in place

an Internet safety policy that meets such requirements; and

‘‘(II) for the second program year after the

effective date of this subsection in which the

library applies for funds under this Act, shall certify that such library is in compliance with such

requirements.

Any library covered by paragraph (1) that is unable

to certify compliance with such requirements in such

second program year shall be ineligible for all funding

under this Act for such second program year and all

subsequent program years until such time as such

library comes into compliance with such requirements.

‘‘(iii) WAIVERS.—Any library subject to a certification under clause (ii)(II) that cannot make the certification otherwise required by that clause may seek

a waiver of that clause if State or local procurement

114 STAT. 2763A–342 PUBLIC LAW 106–554—APPENDIX D

rules or regulations or competitive bidding requirements prevent the making of the certification otherwise

required by that clause. The library shall notify the

Director of the Institute of Museum and Library Services of the applicability of that clause to the library.

Such notice shall certify that the library will comply

with the requirements in paragraph (1) before the start

of the third program year after the effective date of

this subsection for which the library is applying for

funds under this Act.

‘‘(5) NONCOMPLIANCE.—

‘‘(A) USE OF GENERAL EDUCATION PROVISIONS ACT REMEDIES.—Whenever the Director of the Institute of Museum

and Library Services has reason to believe that any recipient of funds this Act is failing to comply substantially

with the requirements of this subsection, the Director

may—

‘‘(i) withhold further payments to the recipient

under this Act,

‘‘(ii) issue a complaint to compel compliance of

the recipient through a cease and desist order, or

‘‘(iii) enter into a compliance agreement with a

recipient to bring it into compliance with such requirements.

‘‘(B) RECOVERY OF FUNDS PROHIBITED.—The actions

authorized by subparagraph (A) are the exclusive remedies

available with respect to the failure of a library to comply

substantially with a provision of this subsection, and the

Director shall not seek a recovery of funds from the recipient for such failure.

‘‘(C) RECOMMENCEMENT OF PAYMENTS.—Whenever the

Director determines (whether by certification or other

appropriate evidence) that a recipient of funds who is subject to the withholding of payments under subparagraph

(A)(i) has cured the failure providing the basis for the

withholding of payments, the Director shall cease the

withholding of payments to the recipient under that

subparagraph.

‘‘(6) SEPARABILITY.—If any provision of this subsection is

held invalid, the remainder of this subsection shall not be

affected thereby.

‘‘(7) DEFINITIONS.—In this section:

‘‘(A) CHILD PORNOGRAPHY.—The term ‘child pornography’ has the meaning given such term in section 2256

of title 18, United States Code.

‘‘(B) HARMFUL TO MINORS.—The term ‘harmful to

minors’ means any picture, image, graphic image file, or

other visual depiction that—

‘‘(i) taken as a whole and with respect to minors,

appeals to a prurient interest in nudity, sex, or excretion;

‘‘(ii) depicts, describes, or represents, in a patently

offensive way with respect to what is suitable for

minors, an actual or simulated sexual act or sexual

contact, actual or simulated normal or perverted sexual

acts, or a lewd exhibition of the genitals; and

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–343

‘‘(iii) taken as a whole, lacks serious literary, artistic, political, or scientific value as to minors.

‘‘(C) MINOR.—The term ‘minor’ means an individual

who has not attained the age of 17. ‘‘(D) OBSCENE.—The term ‘obscene’ has the meaning

given such term in section 1460 of title 18, United States

Code.‘‘(E) SEXUAL ACT; SEXUAL CONTACT.—The terms ‘sexual

act’ and ‘sexual contact’ have the meanings given such

terms in section 2246 of title 18, United States Code.’’. (b) EFFECTIVE DATE.—The amendment made by this section

shall take effect 120 days after the date of the enactment of this

Act.

Subtitle B—Universal Service Discounts

SEC. 1721. REQUIREMENT FOR SCHOOLS AND LIBRARIES TO ENFORCE

INTERNET SAFETY POLICIES WITH TECHNOLOGY

PROTECTION MEASURES FOR COMPUTERS WITH INTERNET ACCESS AS CONDITION OF UNIVERSAL SERVICE DISCOUNTS.

(a) SCHOOLS.—Section 254(h) of the Communications Act of

1934 (47 U.S.C. 254(h)) is amended—

(1) by redesignating paragraph (5) as paragraph (7); and

(2) by inserting after paragraph (4) the following new paragraph (5):

‘‘(5) REQUIREMENTS FOR CERTAIN SCHOOLS WITH COMPUTERS

HAVING INTERNET ACCESS.—

‘‘(A) INTERNET SAFETY.—

‘‘(i) IN GENERAL.—Except as provided in clause

(ii), an elementary or secondary school having computers with Internet access may not receive services at

discount rates under paragraph (1)(B) unless the

school, school board, local educational agency, or other

authority with responsibility for administration of the

school—

‘‘(I) submits to the Commission the certifications described in subparagraphs (B) and (C);

‘‘(II) submits to the Commission a certification

that an Internet safety policy has been adopted

and implemented for the school under subsection

(l); and

‘‘(III) ensures the use of such computers in

accordance with the certifications.

‘‘(ii) APPLICABILITY.—The prohibition in clause (i)

shall not apply with respect to a school that receives

services at discount rates under paragraph (1)(B) only

for purposes other than the provision of Internet access,

Internet service, or internal connections.

‘‘(iii) PUBLIC NOTICE; HEARING.—An elementary or

secondary school described in clause (i), or the school

board, local educational agency, or other authority with

responsibility for administration of the school, shall

provide reasonable public notice and hold at least one

public hearing or meeting to address the proposed

Internet safety policy. In the case of an elementary

114 STAT. 2763A–344 PUBLIC LAW 106–554—APPENDIX D

or secondary school other than an elementary or

secondary school as defined in section 14101 of the

Elementary and Secondary Education Act of 1965 (20

U.S.C. 8801), the notice and hearing required by this

clause may be limited to those members of the public

with a relationship to the school.

‘‘(B) CERTIFICATION WITH RESPECT TO MINORS.—A certification under this subparagraph is a certification that

the school, school board, local educational agency, or other

authority with responsibility for administration of the

school— ‘‘(i) is enforcing a policy of Internet safety for

minors that includes monitoring the online activities

of minors and the operation of a technology protection

measure with respect to any of its computers with

Internet access that protects against access through

such computers to visual depictions that are— ‘‘(I) obscene;

‘‘(II) child pornography; or

‘‘(III) harmful to minors; and ‘‘(ii) is enforcing the operation of such technology

protection measure during any use of such computers

by minors.

‘‘(C) CERTIFICATION WITH RESPECT TO ADULTS.—A certification under this paragraph is a certification that the

school, school board, local educational agency, or other

authority with responsibility for administration of the

school—

‘‘(i) is enforcing a policy of Internet safety that

includes the operation of a technology protection measure with respect to any of its computers with Internet

access that protects against access through such

computers to visual depictions that are—

‘‘(I) obscene; or

‘‘(II) child pornography; and ‘‘(ii) is enforcing the operation of such technology

protection measure during any use of such computers.

‘‘(D) DISABLING DURING ADULT USE.—An administrator,

supervisor, or other person authorized by the certifying

authority under subparagraph (A)(i) may disable the technology protection measure concerned, during use by an

adult, to enable access for bona fide research or other

lawful purpose.

‘‘(E) TIMING OF IMPLEMENTATION.—

‘‘(i) IN GENERAL.—Subject to clause (ii) in the case

of any school covered by this paragraph as of the

effective date of this paragraph under section 1721(h)

of the Children’s Internet Protection Act, the certification under subparagraphs (B) and (C) shall be

made—

‘‘(I) with respect to the first program funding

year under this subsection following such effective

date, not later than 120 days after the beginning

of such program funding year; and

‘‘(II) with respect to any subsequent program

funding year, as part of the application process

for such program funding year.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–345

‘‘(ii) PROCESS.— ‘‘(I) SCHOOLS WITH INTERNET SAFETY POLICY

AND TECHNOLOGY PROTECTION MEASURES IN

PLACE.—A school covered by clause (i) that has

in place an Internet safety policy and technology

protection measures meeting the requirements

necessary for certification under subparagraphs (B)

and (C) shall certify its compliance with subparagraphs (B) and (C) during each annual program

application cycle under this subsection, except that

with respect to the first program funding year

after the effective date of this paragraph under

section 1721(h) of the Children’s Internet Protection Act, the certifications shall be made not later

than 120 days after the beginning of such first

program funding year. ‘‘(II) SCHOOLS WITHOUT INTERNET SAFETY POLICY AND TECHNOLOGY PROTECTION MEASURES IN

PLACE.—A school covered by clause (i) that does

not have in place an Internet safety policy and

technology protection measures meeting the

requirements necessary for certification under subparagraphs (B) and (C)—

‘‘(aa) for the first program year after the

effective date of this subsection in which it

is applying for funds under this subsection,

shall certify that it is undertaking such

actions, including any necessary procurement

procedures, to put in place an Internet safety

policy and technology protection measures

meeting the requirements necessary for certification under subparagraphs (B) and (C); and

‘‘(bb) for the second program year after

the effective date of this subsection in which

it is applying for funds under this subsection,

shall certify that it is in compliance with subparagraphs (B) and (C).

Any school that is unable to certify compliance

with such requirements in such second program

year shall be ineligible for services at discount

rates or funding in lieu of services at such rates

under this subsection for such second year and

all subsequent program years under this subsection, until such time as such school comes into

compliance with this paragraph.

‘‘(III) WAIVERS.—Any school subject to subclause (II) that cannot come into compliance with

subparagraphs (B) and (C) in such second year

program may seek a waiver of subclause (II)(bb)

if State or local procurement rules or regulations

or competitive bidding requirements prevent the

making of the certification otherwise required by

such subclause. A school, school board, local educational agency, or other authority with responsibility for administration of the school shall notify

the Commission of the applicability of such subclause to the school. Such notice shall certify that

114 STAT. 2763A–346 PUBLIC LAW 106–554—APPENDIX D

the school in question will be brought into compliance before the start of the third program year

after the effective date of this subsection in which

the school is applying for funds under this subsection.

‘‘(F) NONCOMPLIANCE.— ‘‘(i) FAILURE TO SUBMIT CERTIFICATION.—Any

school that knowingly fails to comply with the application guidelines regarding the annual submission of

certification required by this paragraph shall not be

eligible for services at discount rates or funding in

lieu of services at such rates under this subsection. ‘‘(ii) FAILURE TO COMPLY WITH CERTIFICATION.— Any school that knowingly fails to ensure the use of

its computers in accordance with a certification under

subparagraphs (B) and (C) shall reimburse any funds

and discounts received under this subsection for the

period covered by such certification. ‘‘(iii) REMEDY OF NONCOMPLIANCE.—

‘‘(I) FAILURE TO SUBMIT.—A school that has

failed to submit a certification under clause (i)

may remedy the failure by submitting the certification to which the failure relates. Upon submittal

of such certification, the school shall be eligible

for services at discount rates under this subsection.

‘‘(II) FAILURE TO COMPLY.—A school that has

failed to comply with a certification as described

in clause (ii) may remedy the failure by ensuring

the use of its computers in accordance with such

certification. Upon submittal to the Commission

of a certification or other appropriate evidence of

such remedy, the school shall be eligible for services at discount rates under this subsection.’’.

(b) LIBRARIES.—Such section 254(h) is further amended by

inserting after paragraph (5), as amended by subsection (a) of

this section, the following new paragraph:

‘‘(6) REQUIREMENTS FOR CERTAIN LIBRARIES WITH COMPUTERS HAVING INTERNET ACCESS.—

‘‘(A) INTERNET SAFETY.—

‘‘(i) IN GENERAL.—Except as provided in clause

(ii), a library having one or more computers with Internet access may not receive services at discount rates

under paragraph (1)(B) unless the library—

‘‘(I) submits to the Commission the certifications described in subparagraphs (B) and (C);

and

‘‘(II) submits to the Commission a certification

that an Internet safety policy has been adopted

and implemented for the library under subsection

(l); and

‘‘(III) ensures the use of such computers in

accordance with the certifications.

‘‘(ii) APPLICABILITY.—The prohibition in clause (i)

shall not apply with respect to a library that receives

services at discount rates under paragraph (1)(B) only

for purposes other than the provision of Internet access,

Internet service, or internal connections.

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–347

‘‘(iii) PUBLIC NOTICE; HEARING.—A library

described in clause (i) shall provide reasonable public

notice and hold at least one public hearing or meeting

to address the proposed Internet safety policy.

‘‘(B) CERTIFICATION WITH RESPECT TO MINORS.—A certification under this subparagraph is a certification that

the library—

‘‘(i) is enforcing a policy of Internet safety that

includes the operation of a technology protection measure with respect to any of its computers with Internet

access that protects against access through such

computers to visual depictions that are— ‘‘(I) obscene;

‘‘(II) child pornography; or

‘‘(III) harmful to minors; and ‘‘(ii) is enforcing the operation of such technology

protection measure during any use of such computers

by minors.

‘‘(C) CERTIFICATION WITH RESPECT TO ADULTS.—A certification under this paragraph is a certification that the

library—

‘‘(i) is enforcing a policy of Internet safety that

includes the operation of a technology protection measure with respect to any of its computers with Internet

access that protects against access through such computers to visual depictions that are—

‘‘(I) obscene; or

‘‘(II) child pornography; and

‘‘(ii) is enforcing the operation of such technology

protection measure during any use of such computers.

‘‘(D) DISABLING DURING ADULT USE.—An administrator,

supervisor, or other person authorized by the certifying

authority under subparagraph (A)(i) may disable the technology protection measure concerned, during use by an

adult, to enable access for bona fide research or other

lawful purpose.

‘‘(E) TIMING OF IMPLEMENTATION.—

‘‘(i) IN GENERAL.—Subject to clause (ii) in the case

of any library covered by this paragraph as of the

effective date of this paragraph under section 1721(h)

of the Children’s Internet Protection Act, the certification under subparagraphs (B) and (C) shall be

made—

‘‘(I) with respect to the first program funding

year under this subsection following such effective

date, not later than 120 days after the beginning

of such program funding year; and

‘‘(II) with respect to any subsequent program

funding year, as part of the application process

for such program funding year.

‘‘(ii) PROCESS.— ‘‘(I) LIBRARIES WITH INTERNET SAFETY POLICY

AND TECHNOLOGY PROTECTION MEASURES IN

PLACE.—A library covered by clause (i) that has

in place an Internet safety policy and technology

protection measures meeting the requirements

necessary for certification under subparagraphs (B)

114 STAT. 2763A–348 PUBLIC LAW 106–554—APPENDIX D

and (C) shall certify its compliance with subparagraphs (B) and (C) during each annual program

application cycle under this subsection, except that

with respect to the first program funding year

after the effective date of this paragraph under

section 1721(h) of the Children’s Internet Protection Act, the certifications shall be made not later

than 120 days after the beginning of such first

program funding year.

‘‘(II) LIBRARIES WITHOUT INTERNET SAFETY

POLICY AND TECHNOLOGY PROTECTION MEASURES

IN PLACE.—A library covered by clause (i) that

does not have in place an Internet safety policy

and technology protection measures meeting the

requirements necessary for certification under subparagraphs (B) and (C)—

‘‘(aa) for the first program year after the

effective date of this subsection in which it

is applying for funds under this subsection,

shall certify that it is undertaking such

actions, including any necessary procurement

procedures, to put in place an Internet safety

policy and technology protection measures

meeting the requirements necessary for certification under subparagraphs (B) and (C); and

‘‘(bb) for the second program year after

the effective date of this subsection in which

it is applying for funds under this subsection,

shall certify that it is in compliance with subparagraphs (B) and (C).

Any library that is unable to certify compliance

with such requirements in such second program

year shall be ineligible for services at discount

rates or funding in lieu of services at such rates

under this subsection for such second year and

all subsequent program years under this subsection, until such time as such library comes into

compliance with this paragraph.

‘‘(III) WAIVERS.—Any library subject to subclause (II) that cannot come into compliance with

subparagraphs (B) and (C) in such second year

may seek a waiver of subclause (II)(bb) if State

or local procurement rules or regulations or

competitive bidding requirements prevent the

making of the certification otherwise required by

such subclause. A library, library board, or other

authority with responsibility for administration of

the library shall notify the Commission of the applicability of such subclause to the library. Such

notice shall certify that the library in question

will be brought into compliance before the start

of the third program year after the effective date

of this subsection in which the library is applying

for funds under this subsection.

‘‘(F) NONCOMPLIANCE.—

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–349

‘‘(i) FAILURE TO SUBMIT CERTIFICATION.—Any

library that knowingly fails to comply with the application guidelines regarding the annual submission of

certification required by this paragraph shall not be

eligible for services at discount rates or funding in

lieu of services at such rates under this subsection.

‘‘(ii) FAILURE TO COMPLY WITH CERTIFICATION.— Any library that knowingly fails to ensure the use

of its computers in accordance with a certification

under subparagraphs (B) and (C) shall reimburse all

funds and discounts received under this subsection

for the period covered by such certification. ‘‘(iii) REMEDY OF NONCOMPLIANCE.— ‘‘(I) FAILURE TO SUBMIT.—A library that has

failed to submit a certification under clause (i)

may remedy the failure by submitting the certification to which the failure relates. Upon submittal

of such certification, the library shall be eligible

for services at discount rates under this subsection. ‘‘(II) FAILURE TO COMPLY.—A library that has

failed to comply with a certification as described

in clause (ii) may remedy the failure by ensuring

the use of its computers in accordance with such

certification. Upon submittal to the Commission

of a certification or other appropriate evidence of

such remedy, the library shall be eligible for services at discount rates under this subsection.’’.

(c) DEFINITIONS.—Paragraph (7) of such section, as redesignated

by subsection (a)(1) of this section, is amended by adding at the

end the following:

‘‘(D) MINOR.—The term ‘minor’ means any individual

who has not attained the age of 17 years.

‘‘(E) OBSCENE.—The term ‘obscene’ has the meaning

given such term in section 1460 of title 18, United States

Code.‘‘(F) CHILD PORNOGRAPHY.—The term ‘child pornography’ has the meaning given such term in section 2256

of title 18, United States Code.

‘‘(G) HARMFUL TO MINORS.—The term ‘harmful to

minors’ means any picture, image, graphic image file, or

other visual depiction that—

‘‘(i) taken as a whole and with respect to minors,

appeals to a prurient interest in nudity, sex, or excretion;

‘‘(ii) depicts, describes, or represents, in a patently

offensive way with respect to what is suitable for

minors, an actual or simulated sexual act or sexual

contact, actual or simulated normal or perverted sexual

acts, or a lewd exhibition of the genitals; and

‘‘(iii) taken as a whole, lacks serious literary, artistic, political, or scientific value as to minors.

‘‘(H) SEXUAL ACT; SEXUAL CONTACT.—The terms ‘sexual

act’ and ‘sexual contact’ have the meanings given such

terms in section 2246 of title 18, United States Code.

‘‘(I) TECHNOLOGY PROTECTION MEASURE.—The term ‘technology protection measure’ means a specific technology

that blocks or filters Internet access to the material covered

114 STAT. 2763A–350 PUBLIC LAW 106–554—APPENDIX D

by a certification under paragraph (5) or (6) to which such

certification relates.’’. (d) CONFORMING AMENDMENT.—Paragraph (4) of such section

is amended by striking ‘‘paragraph (5)(A)’’ and inserting ‘‘paragraph

(7)(A)’’. (e) SEPARABILITY.—If any provision of paragraph (5) or (6)

of section 254(h) of the Communications Act of 1934, as amended

by this section, or the application thereof to any person or circumstance is held invalid, the remainder of such paragraph and

the application of such paragraph to other persons or circumstances

shall not be affected thereby.

(f ) REGULATIONS.— (1) REQUIREMENT.—The Federal Communications Commission shall prescribe regulations for purposes of administering

the provisions of paragraphs (5) and (6) of section 254(h) of

the Communications Act of 1934, as amended by this section.

(2) DEADLINE.—Notwithstanding any other provision of

law, the Commission shall prescribe regulations under paragraph (1) so as to ensure that such regulations take effect

120 days after the date of the enactment of this Act.

(g) AVAILABILITY OF CERTAIN FUNDS FOR ACQUISITION OF TECH- NOLOGY PROTECTION MEASURES.— (1) IN GENERAL.—Notwithstanding any other provision of

law, funds available under section 3134 or part A of title

VI of the Elementary and Secondary Education Act of 1965,

or under section 231 of the Library Services and Technology

Act, may be used for the purchase or acquisition of technology

protection measures that are necessary to meet the requirements of this title and the amendments made by this title.

No other sources of funds for the purchase or acquisition of

such measures are authorized by this title, or the amendments

made by this title.

(2) TECHNOLOGY PROTECTION MEASURE DEFINED.—In this

section, the term ‘‘technology protection measure’’ has the

meaning given that term in section 1703.

(h) EFFECTIVE DATE.—The amendments made by this section

shall take effect 120 days after the date of the enactment of this

Act.

Subtitle C—Neighborhood Children’s

Internet Protection

SEC. 1731. SHORT TITLE.

This subtitle may be cited as the ‘‘Neighborhood Children’s

Internet Protection Act’’.

SEC. 1732. INTERNET SAFETY POLICY REQUIRED.

Section 254 of the Communications Act of 1934 (47 U.S.C.

254) is amended by adding at the end the following:

‘‘(l) INTERNET SAFETY POLICY REQUIREMENT FOR SCHOOLS AND

LIBRARIES.—

‘‘(1) IN GENERAL.—In carrying out its responsibilities under

subsection (h), each school or library to which subsection (h)

applies shall—

‘‘(A) adopt and implement an Internet safety policy

that addresses—

PUBLIC LAW 106–554—APPENDIX D 114 STAT. 2763A–351

‘‘(i) access by minors to inappropriate matter on

the Internet and World Wide Web;

‘‘(ii) the safety and security of minors when using

electronic mail, chat rooms, and other forms of direct

electronic communications;

‘‘(iii) unauthorized access, including so-called

‘hacking’, and other unlawful activities by minors

online;

‘‘(iv) unauthorized disclosure, use, and dissemination of personal identification information regarding

minors; and

‘‘(v) measures designed to restrict minors’ access

to materials harmful to minors; and

‘‘(B) provide reasonable public notice and hold at least

one public hearing or meeting to address the proposed

Internet safety policy.

‘‘(2) LOCAL DETERMINATION OF CONTENT.—A determination

regarding what matter is inappropriate for minors shall be

made by the school board, local educational agency, library,

or other authority responsible for making the determination.

No agency or instrumentality of the United States Government

may—

‘‘(A) establish criteria for making such determination;

‘‘(B) review the determination made by the certifying

school, school board, local educational agency, library, or

other authority; or

‘‘(C) consider the criteria employed by the certifying

school, school board, local educational agency, library, or

other authority in the administration of subsection

(h)(1)(B).

‘‘(3) AVAILABILITY FOR REVIEW.—Each Internet safety policy

adopted under this subsection shall be made available to the

Commission, upon request of the Commission, by the school,

school board, local educational agency, library, or other authority responsible for adopting such Internet safety policy for

purposes of the review of such Internet safety policy by the

Commission.

‘‘(4) EFFECTIVE DATE.—This subsection shall apply with

respect to schools and libraries on or after the date that is

120 days after the date of the enactment of the Children’s

Internet Protection Act.’’.

SEC. 1733. IMPLEMENTING REGULATIONS.

Not later than 120 days after the date of enactment of this

Act, the Federal Communications Commission shall prescribe regulations for purposes of section 254(l) of the Communications Act

of 1934, as added by section 1732 of this Act.

Subtitle D—Expedited Review

SEC. 1741. EXPEDITED REVIEW.

(a) THREE-JUDGE DISTRICT COURT HEARING.—Notwithstanding

any other provision of law, any civil action challenging the constitutionality, on its face, of this title or any amendment made by

this title, or any provision thereof, shall be heard by a district

114 STAT. 2763A–352 PUBLIC LAW 106–554—APPENDIX D

court of three judges convened pursuant to the provisions of section

2284 of title 28, United States Code.

(b) APPELLATE REVIEW.—Notwithstanding any other provision

of law, an interlocutory or final judgment, decree, or order of the

court of three judges in an action under subsection (a) holding

this title or an amendment made by this title, or any provision

thereof, unconstitutional shall be reviewable as a matter of right

by direct appeal to the Supreme Court. Any such appeal shall

be filed not more than 20 days after entry of such judgment,

decree, or order.

This Act may be cited as the ‘‘Miscellaneous Appropriations

Act, 2001’’.

ENDNOTE: Appendixes D–1 and D–2 were added pursuant to the provisions of sections 125

and 127 of this Appendix (114 Stat. 2763A–229).

PUBLIC LAW 106–554—APPENDIX D–1 114 STAT. 2763A–353

APPENDIX D–1—S. 2273

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Black Rock Desert-High Rock

Canyon Emigrant Trails National Conservation Area Act of 2000’’.

SEC. 2. FINDINGS.

The Congress finds the following:

(1) The areas of northwestern Nevada known as the Black

Rock Desert and High Rock Canyon contain and surround

the last nationally significant, untouched segments of the historic California emigrant Trails, including wagon ruts, historic

inscriptions, and a wilderness landscape largely unchanged

since the days of the pioneers.

(2) The relative absence of development in the Black Rock

Desert and high Rock Canyon areas from emigrant times to

the present day offers a unique opportunity to capture the

terrain, sights, and conditions of the overland trails as they

were experienced by the emigrants and to make available to

both present and future generations of Americans the opportunity of experiencing emigrant conditions in an unaltered setting.

(3) The Black Rock Desert and High Rock Canyon areas

are unique segments of the Northern Great Basin and contain

broad representation of the Great Basin’s land forms and plant

and animal species, including golden eagles and other birds

of prey, sage grouse, mule deer, pronghorn antelope, bighorn

sheep, free roaming horses and burros, threatened fish and

sensitive plants.

(4) The Black Rock-High Rock region contains a number

of cultural and natural resources that have been declared

eligible for National Historic Landmark and Natural Landmark

status, including a portion of the 1843–44 John Charles Fremont exploration route, the site of the death of Peter Lassen,

early military facilities, and examples of early homesteading

and mining.

(5) The archeological, paleontological, and geographical

resources of the Black Rock-High Rock region include numerous

prehistoric and historic Native American sites, wooly mammoth

sites, some of the largest natural potholes of North America,

and a remnant dry Pleistocene lakebed (playa) where the curvature of the Earth may be observed.

(6) The two large wilderness mosaics that frame the conservation area offer exceptional opportunities for solitude and

serve to protect the integrity of the viewshed of the historic

emigrant trails.

114 STAT. 2763A–354 PUBLIC LAW 106–554—APPENDIX D–1

(7) Public lands in the conservation area have been used

for domestic livestock grazing for over a century, with resultant

benefits to community stability and contributions to the local

and State economies. It has not been demonstrated that

continuation of this use would be incompatible with appropriate

protection and sound management of the resource values of

these lands; therefore, it is expected that such grazing will

continue in accordance with the management plan for the conservation area and other applicable laws and regulations.

(8) The Black Rock Desert playa is a unique natural

resource that serves as the primary destination for the majority

of visitors to the conservation area, including visitors associated

with large-scale permitted events. It is expected that such

permitted events will continue to be administered in accordance

with the management plan for the conservation area and other

applicable laws and regulations.

SEC. 3. DEFINITIONS.

As used in this Act:

(1) The term ‘‘Secretary’’ means the Secretary of the

Interior.

(2) The term ‘‘public lands’’ has the meaning stated in

section 103(e) of the Federal Land Policy and Management

Act of 1976 (43 U.S.C. 1702(e)).

(3) The term ‘‘conservation area’’ means the Black Rock

Desert-High Rock Canyon Emigrant Trails National Conservation Area established pursuant to section 4 of this Act.

SEC. 4. ESTABLISHMENT OF THE CONSERVATION AREA.

(a) ESTABLISHMENT AND PURPOSES.—In order to conserve, protect, and enhance for the benefit and enjoyment of present and

future generations the unique and nationally important historical,

cultural, paleontological, scenic, scientific, biological, educational,

wildlife, riparian, wilderness, endangered species, and recreational

values and resources associated with the Applegate-Lassen and

Nobles Trails corridors and surrounding areas, there is hereby

established the Black Rock Desert-High Rock Canyon Emigrant

Trails National Conservation Area in the State of Nevada.

(b) AREAS INCLUDED.—The conservation area shall consist of

approximately 797,100 acres of public lands as generally depicted

on the map entitled ‘‘Black Rock Desert Emigrant Trail National

Conservation Area’’ and dated July 19, 2000.

(c) MAPS AND LEGAL DESCRIPTION.—As soon as practicable after

the date of the enactment of this Act, the Secretary shall submit

to Congress a map and legal description of the conservation area.

The map and legal description shall have the same force and

effect as if included in this Act, except the Secretary may correct

clerical and typographical errors in such map and legal description.

Copies of the map and legal description shall be on file and available

for public inspection in the appropriate offices of the Bureau of

Land Management.

SEC. 5. MANAGEMENT.

(a) MANAGEMENT.—The Secretary, acting through the Bureau

of Land Management, shall manage the conservation area in a

manner that conserves, protects, and enhances its resources and

values, including those resources and values specified in subsection

4(a), in accordance with this Act, the Federal Land Policy and

PUBLIC LAW 106–554—APPENDIX D–1 114 STAT. 2763A–355

Management Act of 1976 (43 U.S.C. 1701 et seq.), and other

applicable provisions of law.

(b) ACCESS.—

(1) IN GENERAL.—The Secretary shall maintain adequate

access for the reasonable use and enjoyment of the conservation

area.

(2) PRIVATE LAND.—The Secretary shall provide reasonable

access to privately owned land or interests in land within

the boundaries of the conservation area.

(3) EXISTING PUBLIC ROADS.—The Secretary is authorized

to maintain existing public access within the boundaries of

the conservation area in a manner consistent with the purposes

for which the conservation area was established.

(c) USES.— (1) IN GENERAL.—The Secretary shall only allow such uses

of the conservation area as the Secretary finds will further

the purposes for which the conservation area is established.

(2) OFF-HIGHWAY VEHICLE USE.—Except where needed for

administrative purposes or to respond to an emergency, use

of motorized vehicles in the conservation area shall be permitted only on roads and trails and in other areas designated

for use of motorized vehicles as part of the management plan

prepared pursuant to subsection (e).

(3) PERMITTED EVENTS.—The Secretary may continue to

permit large-scale events in defined, low impact areas of the

Black Rock Desert playa in the conservation area in accordance

with the management plan prepared pursuant to subsection

(e).

(d) HUNTING, TRAPPING, AND FISHING.—Nothing in this Act

shall be deemed to diminish the jurisdiction of the State of Nevada

with respect to fish and wildlife management, including regulation

of hunting and fishing, on public lands within the conservation

area.

(e) MANAGEMENT PLAN.—Within three years following the date

of enactment of this Act, the Secretary shall develop a comprehensive resource management plan for the long-term protection and

management of the conservation area. The plan shall be developed

with full public participation and shall describe the appropriate

uses and management of the conservation area consistent with

the provisions of this Act. The plan may incorporate appropriate

decisions contained in any current management or activity plan

for the area and may use information developed in previous studies

of the lands within or adjacent to the conservation area.

(f) GRAZING.—Where the Secretary of the Interior currently

permits livestock grazing in the conservation area, such grazing

shall be allowed to continue subject to all applicable laws, regulations, and executive orders.

(g) VISITOR SERVICE FACILITIES.—The Secretary is authorized

to establish, in cooperation with other public or private entities

as the Secretary may deem appropriate, visitor service facilities

for the purpose of providing information about the historical, cultural, ecological, recreational, and other resources of the conservation area.

SEC. 6. WITHDRAWAL.

Subject to valid existing rights, all Federal lands within the

conservation area and all lands and interests therein which are

114 STAT. 2763A–356 PUBLIC LAW 106–554—APPENDIX D–1

hereafter acquired by the United States are hereby withdrawn

from all forms of entry, appropriation, or disposal under the public

land laws, from location, entry, and patent under the mining laws,

from operation of the mineral leasing and geothermal leasing laws

and from the minerals materials laws and all amendments thereto.

SEC. 7. NO BUFFER ZONES.

The Congress does not intend for the establishment of the

conservation area to lead to the creation of protective perimeters

or buffer zones around the conservation area. The fact that there

may be activities or uses on lands outside the conservation area

that would not be permitted in the conservation area shall not

preclude such activities or uses on such lands up to the boundary

of the conservation area consistent with other applicable laws.

SEC. 8. WILDERNESS.

(a) DESIGNATION.—In furtherance of the purposes of the Wilderness Act of 1964 (16 U.S.C. 1131 et seq.), the following lands

in the State of Nevada are designated as wilderness, and, therefore,

as components of the National Wilderness Preservation System:

(1) Certain lands in the Black Rock Desert Wilderness

Study Area comprised of approximately 315,700 acres, as generally depicted on a map entitled ‘‘Black Rock Desert Wilderness—Proposed’’ and dated July 19, 2000, and which shall

be known as the Black Rock Desert Wilderness.

(2) Certain lands in the Pahute Peak Wilderness Study

Area comprised of approximately 57,400 acres, as generally

depicted on a map entitled ‘‘Pahute Peak Wilderness—Proposed’’ and dated July 19, 2000, and which shall be known

as the Pahute Peak Wilderness.

(3) Certain lands in the North Black Rock Range Wilderness Study Area comprised of approximately 30,800 acres, as

generally depicted on a map entitled ‘‘North Black Rock Range

Wilderness—Proposed’’ and dated July 19, 2000, and which

shall be known as the North Black Rock Range Wilderness.

(4) Certain lands in the East Fork High Rock Canyon

Wilderness Study Area comprised of approximately 52,800

acres, as generally depicted on a map entitled ‘‘East Fork

High Rock Canyon Wilderness—Proposed’’ and dated July 19,

2000, and which shall be known as the East Fork High Rock

Canyon Wilderness.

(5) Certain lands in the High Rock Lake Wilderness Study

Area comprised of approximately 59,300 acres, as generally

depicted on a map entitled ‘‘High Rock Lake Wilderness—

Proposed’’ and dated July 19, 2000, and which shall be known

as the High Rock Lake Wilderness.

(6) Certain lands in the Little High Rock Canyon Wilderness Study Area comprised of approximately 48,700 acres, as

generally depicted on a map entitled ‘‘Little High Rock Canyon

Wilderness—Proposed’’ and dated July 19, 2000, and which

shall be known as the Little High Rock Canyon Wilderness.

(7) Certain lands in the High Rock Canyon Wilderness

Study Area and Yellow Rock Canyon Wilderness Study Area

comprised of approximately 46,600 acres, as generally depicted

on a map entitled ‘‘High Rock Canyon Wilderness—Proposed’’

and dated July 19, 2000, and which shall be known as the

High Rock Canyon Wilderness.

PUBLIC LAW 106–554—APPENDIX D–1 114 STAT. 2763A–357

(8) Certain lands in the Calico Mountains Wilderness Study

Area comprised of approximately 65,400 acres, as generally

depicted on a map entitled ‘‘Calico Mountains Wilderness— Proposed’’ and dated July 19, 2000, and which shall be known

as the Calico Mountains Wilderness.

(9) Certain lands in the South Jackson Mountains Wilderness Study Area comprised of approximately 56,800 acres, as

generally depicted on a map entitled ‘‘South Jackson Mountains

Wilderness—Proposed’’ and dated July 19, 2000, and which

shall be known as the South Jackson Mountains Wilderness.

(10) Certain lands in the North Jackson Mountains Wilderness Study Area comprised of approximately 24,000 acres, as

generally depicted on a map entitled ‘‘North Jackson Mountains

Wilderness—Proposed’’ and dated July 19, 2000, and which

shall be known as the North Jackson Mountains Wilderness.

(b) ADMINISTRATION OF WILDERNESS AREAS.—Subject to valid

existing rights, each wilderness area designated by this Act shall

be administered by the Secretary in accordance with the provisions

of the Wilderness Act, except that any reference in such provisions

to the effective date of the Wilderness Act shall be deemed to

be a reference to the date of enactment of this Act and any reference

to the Secretary of Agriculture shall be deemed to be a reference

to the Secretary of the Interior.

(c) MAPS AND LEGAL DESCRIPTION.—As soon as practicable after

the date of the enactment of this Act, the Secretary shall submit

to Congress a map and legal description of the wilderness areas

designated under this Act. The map and legal description shall

have the same force and effect as if included in this Act, except

the Secretary may correct clerical and typographical errors in such

map and legal description. Copies of the map and legal description

shall be on file and available for public inspection in the appropriate

offices of the Bureau of Land Management.

(d) GRAZING.—Within the wilderness areas designated under

subsection (a), the grazing of livestock, where established prior

to the date of enactment of this Act, shall be permitted to continue

subject to such reasonable regulations, policies, and practices as

the Secretary deems necessary, as long as such regulations, policies,

and practices fully conform with and implement the intent of Congress regarding grazing in such areas as such intent is expressed

in the Wilderness Act and section 101(f) of Public Law 101–628.

SEC. 9. AUTHORIZATION OF APPROPRIATIONS.

There is hereby authorized to be appropriated such sums as

may be necessary to carry out the provisions of this Act.

PUBLIC LAW 106–554—APPENDIX D–2 114 STAT. 2763A–359

APPENDIX D–2—S. 2885

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Jamestown 400th Commemoration Commission Act of 2000’’.

SEC. 2. FINDINGS AND PURPOSE.

(a) FINDINGS.—Congress finds that—

(1) the founding of the colony at Jamestown, Virginia in

1607, the first permanent English colony in the New World,

and the capital of Virginia for 92 years, has major significance

in the history of the United States;

(2) the settlement brought people from throughout the

Atlantic Basin together to form a multicultural society, including English, other Europeans, Native Americans, and Africans;

(3) the economic, political, religious, and social institutions

that developed during the first 9 decades of the existence of

Jamestown continue to have profound effects on the United

States, particularly in English common law and language, cross

cultural relationships, and economic structure and status;

(4) the National Park Service, the Association for the

Preservation of Virginia Antiquities, and the Jamestown-Yorktown Foundation of the Commonwealth of Virginia collectively

own and operate significant resources related to the early history of Jamestown; and

(5) in 1996—

(A) the Commonwealth of Virginia designated the

Jamestown-Yorktown Foundation as the State agency

responsible for planning and implementing the Commonwealth’s portion of the commemoration of the 400th

anniversary of the founding of the Jamestown settlement;

(B) the Foundation created the Celebration 2007 Steering Committee, known as the Jamestown 2007 Steering

Committee; and

(C) planning for the commemoration began.

(b) PURPOSE.—The purpose of this Act is to establish the Jamestown 400th Commemoration Commission to—

(1) ensure a suitable national observance of the Jamestown

2007 anniversary by complementing the programs and activities

of the Commonwealth of Virginia;

(2) cooperate with and assist the programs and activities

of the State in observance of the Jamestown 2007 anniversary;

(3) assist in ensuring that Jamestown 2007 observances

provide an excellent visitor experience and beneficial interaction

between visitors and the natural and cultural resources of

the Jamestown sites;

114 STAT. 2763A–360 PUBLIC LAW 106–554—APPENDIX D–2

(4) assist in ensuring that the Jamestown 2007 observances

are inclusive and appropriately recognize the experiences of

all people present in 17th century Jamestown;

(5) provide assistance to the development of Jamestownrelated programs and activities;

(6) facilitate international involvement in the Jamestown

2007 observances;

(7) support and facilitate marketing efforts for a commemorative coin, stamp, and related activities for the Jamestown

2007 observances; and

(8) assist in the appropriate development of heritage tourism and economic benefits to the United States.

SEC. 3. DEFINITIONS.

In this Act:

(1) COMMEMORATION.—The term ‘‘commemoration’’ means

the commemoration of the 400th anniversary of the founding

of the Jamestown settlement.

(2) COMMISSION.—The term ‘‘Commission’’ means the

Jamestown 400th Commemoration Commission established by

section 4(a).

(3) GOVERNOR.—The term ‘‘Governor’’ means the Governor

of Virginia.

(4) SECRETARY.—The term ‘‘Secretary’’ means the Secretary

of the Interior.

(5) STATE.—The term ‘‘State’’ means the Commonwealth

of Virginia, including agencies and entities of the Commonwealth.

SEC. 4. JAMESTOWN 400TH COMMEMORATION COMMISSION.

(a) IN GENERAL.—There is established a commission to be

known as the ‘‘Jamestown 400th Commemoration Commission’’. (b) MEMBERSHIP.— (1) IN GENERAL.—The Commission shall be composed of

15 members, of whom— (A) 4 members shall be appointed by the Secretary,

taking into consideration the recommendations of the

Chairperson of the Jamestown 2007 Steering Committee;

(B) 4 members shall be appointed by the Secretary,

taking into consideration the recommendations of the Governor;

(C) 2 members shall be employees of the National

Park Service, of which— (i) 1 shall be the Director of the National Park

Service (or a designee); and

(ii) 1 shall be an employee of the National Park

Service having experience relevant to the commemoration, to be appointed by the Secretary; and

(D) 5 members shall be individuals that have an

interest in, support for, and expertise appropriate to, the

commemoration, to be appointed by the Secretary.

(2) TERM; VACANCIES.— (A) TERM.—A member of the Commission shall be

appointed for the life of the Commission.

(B) VACANCIES.—

(i) IN GENERAL.—A vacancy on the Commission

shall be filled in the same manner in which the original

appointment was made.

PUBLIC LAW 106–554—APPENDIX D–2 114 STAT. 2763A–361

(ii) PARTIAL TERM.—A member appointed to fill

a vacancy on the Commission shall serve for the

remainder of the term for which the predecessor of

the member was appointed.

(3) MEETINGS.— (A) IN GENERAL.—The Commission shall meet— (i) at least twice each year; or

(ii) at the call of the Chairperson or the majority

of the members of the Commission.

(B) INITIAL MEETING.—Not later than 30 days after

the date on which all members of the Commission have

been appointed, the Commission shall hold the initial meeting of the Commission.

(4) VOTING.— (A) IN GENERAL.—The Commission shall act only on

an affirmative vote of a majority of the members of the

Commission.

(B) QUORUM.—A majority of the Commission shall constitute a quorum.

(5) CHAIRPERSON.—The Secretary shall appoint a Chairperson of the Commission, taking into consideration any recommendations of the Governor.

(c) DUTIES.—

(1) IN GENERAL.—The Commission shall—

(A) plan, develop, and execute programs and activities

appropriate to commemorate the 400th anniversary of the

founding of Jamestown;

(B) generally facilitate Jamestown-related activities

throughout the United States;

(C) encourage civic, patriotic, historical, educational,

religious, economic, and other organizations throughout the

United States to organize and participate in anniversary

activities to expand the understanding and appreciation

of the significance of the founding and early history of

Jamestown;

(D) coordinate and facilitate for the public scholarly

research on, publication about, and interpretation of,

Jamestown; and

(E) ensure that the 400th anniversary of Jamestown

provides a lasting legacy and long-term public benefit by

assisting in the development of appropriate programs and

facilities.

(2) PLANS; REPORTS.—

(A) STRATEGIC PLAN; ANNUAL PERFORMANCE PLANS.—

In accordance with the Government Performance and

Results Act of 1993 (Public Law 103–62; 107 Stat. 285),

the Commission shall prepare a strategic plan and annual

performance plans for the activities of the Commission

carried out under this Act.

(B) FINAL REPORT.—Not later than September 30, 2008,

the Commission shall complete a final report that

contains—

(i) a summary of the activities of the Commission;

(ii) a final accounting of funds received and

expended by the Commission; and

(iii) the findings and recommendations of the

Commission.

114 STAT. 2763A–362 PUBLIC LAW 106–554—APPENDIX D–2

(d) POWERS OF THE COMMISSION.—The Commission may— (1) accept donations and make dispersions of money, personal services, and real and personal property related to Jamestown and of the significance of Jamestown in the history of

the United States;

(2) appoint such advisory committees as the Commission

determines to be necessary to carry out this Act;

(3) authorize any member or employee of the Commission

to take any action that the Commission is authorized to take

by this Act;

(4) procure supplies, services, and property, and make or

enter into contracts, leases or other legal agreements, to carry

out this Act (except that any contracts, leases or other legal

agreements made or entered into by the Commission shall

not extend beyond the date of termination of the Commission);

(5) use the United States mails in the same manner and

under the same conditions as other Federal agencies;

(6) subject to approval by the Commission, make grants

in amounts not to exceed $10,000 to communities and nonprofit

organizations to develop programs to assist in the commemoration;

(7) make grants to research and scholarly organizations

to research, publish, or distribute information relating to the

early history of Jamestown; and

(8) provide technical assistance to States, localities, and

nonprofit organizations to further the commemoration.

(e) COMMISSION PERSONNEL MATTERS.—

(1) COMPENSATION OF MEMBERS OF THE COMMISSION.—

(A) IN GENERAL.—Except as provided in subparagraph

(B), a member of the Commission shall serve without compensation.

(B) FEDERAL EMPLOYEES.—A member of the Commission who is an officer or employee of the Federal Government shall serve without compensation in addition to the

compensation received for the services of the member as

an officer or employee of the Federal Government.

(C) TRAVEL EXPENSES.—A member of the Commission

shall be allowed travel expenses, including per diem in

lieu of subsistence, at rates authorized for an employee

of an agency under subchapter I of chapter 57 of title

5, United States Code, while away from the home or regular

place of business of the member in the performance of

the duties of the Commission.

(2) STAFF.—

(A) IN GENERAL.—The Chairperson of the Commission

may, without regard to the civil service laws (including

regulations), appoint and terminate an executive director

and such other additional personnel as are necessary to

enable the Commission to perform the duties of the

Commission.

(B) CONFIRMATION OF EXECUTIVE DIRECTOR.—The

employment of an executive director shall be subject to

confirmation by the Commission.

(3) COMPENSATION.—

(A) IN GENERAL.—Except as provided in subparagraph

(B), the Chairperson of the Commission may fix the compensation of the executive director and other personnel

PUBLIC LAW 106–554—APPENDIX D–2 114 STAT. 2763A–363

without regard to the provisions of chapter 51 and subchapter III of chapter 53 of title 5, United States Code,

relating to classification of positions and General Schedule

pay rates.

(B) MAXIMUM RATE OF PAY.—The rate of pay for the

executive director and other personnel shall not exceed

the rate payable for level V of the Executive Schedule

under section 5316 of title 5, United States Code.

(4) DETAIL OF GOVERNMENT EMPLOYEES.— (A) FEDERAL EMPLOYEES.— (i) IN GENERAL.—On the request of the Commission, the head of any Federal agency may detail, on

a reimbursable or nonreimbursable basis, any of the

personnel of the agency to the Commission to assist

the Commission in carrying out the duties of the

Commission under this Act.

(ii) CIVIL SERVICE STATUS.—The detail of an

employee under clause (i) shall be without interruption

or loss of civil service status or privilege.

(B) STATE EMPLOYEES.—The Commission may—

(i) accept the services of personnel detailed from

States (including subdivisions of States); and

(ii) reimburse States for services of detailed personnel.

(5) VOLUNTEER AND UNCOMPENSATED SERVICES.—Notwithstanding section 1342 of title 31, United States Code, the

Commission may accept and use voluntary and uncompensated

services as the Commission determines necessary.

(6) SUPPORT SERVICES.—The Director of the National Park

Service shall provide to the Commission, on a reimbursable

basis, such administrative support services as the Commission

may request.

(f) PROCUREMENT OF TEMPORARY AND INTERMITTENT SERVICES.—The Chairperson of the Commission may procure temporary

and intermittent services in accordance with section 3109(b) of

title 5, United States Code, at rates for individuals that do not

exceed the daily equivalent of the annual rate of basic pay prescribed for level V of the Executive Schedule under section 5316

of that title.

(g) FACA NONAPPLICABILITY.—Section 14(b) of the Federal

Advisory Committee Act (5 U.S.C. App.) shall not apply to the

Commission.

(h) NO EFFECT ON AUTHORITY.—Nothing in this section supersedes the authority of the State, the National Park Service, or

the Association for the Preservation of Virginia Antiquities, concerning the commemoration.

(i) TERMINATION.—The Commission shall terminate on December 31, 2008.

SEC. 5. AUTHORIZATION OF APPROPRIATIONS.

There are authorized to be appropriated such sums as are

necessary to carry out this Act.

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–365

APPENDIX E—H.R. 5660

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) SHORT TITLE.—This Act may be cited as the ‘‘Commodity

Futures Modernization Act of 2000’’.

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

is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Purposes.

TITLE I—COMMODITY FUTURES MODERNIZATION

Sec. 101. Definitions.

Sec. 102. Agreements, contracts, and transactions in foreign currency, government

securities, and certain other commodities.

Sec. 103. Legal certainty for excluded derivative transactions.

Sec. 104. Excluded electronic trading facilities.

Sec. 105. Hybrid instruments; swap transactions.

Sec. 106. Transactions in exempt commodities.

Sec. 107. Application of commodity futures laws.

Sec. 108. Protection of the public interest.

Sec. 109. Prohibited transactions.

Sec. 110. Designation of boards of trade as contract markets.

Sec. 111. Derivatives transaction execution facilities.

Sec. 112. Derivatives clearing.

Sec. 113. Common provisions applicable to registered entities.

Sec. 114. Exempt boards of trade.

Sec. 115. Suspension or revocation of designation as contract market.

Sec. 116. Authorization of appropriations.

Sec. 117. Preemption.

Sec. 118. Predispute resolution agreements for institutional customers.

Sec. 119. Consideration of costs and benefits and antitrust laws.

Sec. 120. Contract enforcement between eligible counterparties.

Sec. 121. Special procedures to encourage and facilitate bona fide hedging by agricultural producers. Sec. 122. Rule of construction.

Sec. 123. Technical and conforming amendments.

Sec. 124. Privacy.

Sec. 125. Report to Congress.

Sec. 126. International activities of the Commodity Futures Trading Commission.

TITLE II—COORDINATED REGULATION OF SECURITY FUTURES PRODUCTS

Subtitle A—Securities Law Amendments

Sec. 201. Definitions under the Securities Exchange Act of 1934.

Sec. 202. Regulatory relief for markets trading security futures products.

Sec. 203. Regulatory relief for intermediaries trading security futures products.

Sec. 204. Special provisions for interagency cooperation.

Sec. 205. Maintenance of market integrity for security futures products.

Sec. 206. Special provisions for the trading of security futures products.

Sec. 207. Clearance and settlement.

Sec. 208. Amendments relating to registration and disclosure issues under the Securities Act of 1933 and the Securities Exchange Act of 1934. Sec. 209. Amendments to the Investment Company Act of 1940 and the Investment

Advisers Act of 1940.

Sec. 210. Preemption of State laws.

Subtitle B—Amendments to the Commodity Exchange Act

Sec. 251. Jurisdiction of Securities and Exchange Commission; other provisions.

114 STAT. 2763A–366 PUBLIC LAW 106–554—APPENDIX E

Sec. 252. Application of the Commodity Exchange Act to national securities exchanges and national securities associations that trade security futures.

Sec. 253. Notification of investigations and enforcement actions.

TITLE III—LEGAL CERTAINTY FOR SWAP AGREEMENTS

Sec. 301. Swap agreement.

Sec. 302. Amendments to the Securities Act of 1933.

Sec. 303. Amendments to the Securities Exchange Act of 1934.

Sec. 304. Savings provision.

TITLE IV—REGULATORY RESPONSIBILITY FOR BANK PRODUCTS

Sec. 401. Short title.

Sec. 402. Definitions.

Sec. 403. Exclusion of identified banking products commonly offered on or before

December 5, 2000.

Sec. 404. Exclusion of certain identified banking products offered by banks after

December 5, 2000.

Sec. 405. Exclusion of certain other identified banking products.

Sec. 406. Administration of the predominance test.

Sec. 407. Exclusion of covered swap agreements.

Sec. 408. Contract enforcement.

SEC. 2. PURPOSES.

The purposes of this Act are—

(1) to reauthorize the appropriation for the Commodity

Futures Trading Commission;

(2) to streamline and eliminate unnecessary regulation for

the commodity futures exchanges and other entities regulated

under the Commodity Exchange Act;

(3) to transform the role of the Commodity Futures Trading

Commission to oversight of the futures markets;

(4) to provide a statutory and regulatory framework for

allowing the trading of futures on securities;

(5) to clarify the jurisdiction of the Commodity Futures

Trading Commission over certain retail foreign exchange transactions and bucket shops that may not be otherwise regulated;

(6) to promote innovation for futures and derivatives and

to reduce systemic risk by enhancing legal certainty in the

markets for certain futures and derivatives transactions;

(7) to reduce systemic risk and provide greater stability

to markets during times of market disorder by allowing the

clearing of transactions in over-the-counter derivatives through

appropriately regulated clearing organizations; and

(8) to enhance the competitive position of United States

financial institutions and financial markets.

TITLE I—COMMODITY FUTURES

MODERNIZATION

SEC. 101. DEFINITIONS.

Section 1a of the Commodity Exchange Act (7 U.S.C. 1a) is

amended—

(1) by redesignating paragraphs (1) through (7), (8) through

(12), (13) through (15), and (16) as paragraphs (2) through

(8), (16) through (20), (22) through (24), and (28), respectively;

(2) by inserting before paragraph (2) (as redesignated by

paragraph (1)) the following:

‘‘(1) ALTERNATIVE TRADING SYSTEM.—The term ‘alternative

trading system’ means an organization, association, or group

of persons that—

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–367

‘‘(A) is registered as a broker or dealer pursuant to

section 15(b) of the Securities Exchange Act of 1934 (except

paragraph (11) thereof );

‘‘(B) performs the functions commonly performed by

an exchange (as defined in section 3(a)(1) of the Securities

Exchange Act of 1934);

‘‘(C) does not—

‘‘(i) set rules governing the conduct of subscribers

other than the conduct of such subscribers’ trading

on the alternative trading system; or

‘‘(ii) discipline subscribers other than by exclusion

from trading; and

‘‘(D) is exempt from the definition of the term

‘exchange’ under such section 3(a)(1) by rule or regulation

of the Securities and Exchange Commission on terms that

require compliance with regulations of its trading functions.’’;

(3) by striking paragraph (2) (as redesignated by paragraph

(1)) and inserting the following:

‘‘(2) BOARD OF TRADE.—The term ‘board of trade’ means

any organized exchange or other trading facility.’’;

(4) by inserting after paragraph (8) (as redesignated by

paragraph (1)) the following:

‘‘(9) DERIVATIVES CLEARING ORGANIZATION.—

‘‘(A) IN GENERAL.—The term ‘derivatives clearing

organization’ means a clearinghouse, clearing association,

clearing corporation, or similar entity, facility, system, or

organization that, with respect to an agreement, contract,

or transaction—

‘‘(i) enables each party to the agreement, contract,

or transaction to substitute, through novation or otherwise, the credit of the derivatives clearing organization

for the credit of the parties;

‘‘(ii) arranges or provides, on a multilateral basis,

for the settlement or netting of obligations resulting

from such agreements, contracts, or transactions

executed by participants in the derivatives clearing

organization; or

‘‘(iii) otherwise provides clearing services or

arrangements that mutualize or transfer among

participants in the derivatives clearing organization

the credit risk arising from such agreements, contracts,

or transactions executed by the participants.

‘‘(B) EXCLUSIONS.—The term ‘derivatives clearing

organization’ does not include an entity, facility, system,

or organization solely because it arranges or provides for—

‘‘(i) settlement, netting, or novation of obligations

resulting from agreements, contracts, or transactions,

on a bilateral basis and without a central counterparty;

‘‘(ii) settlement or netting of cash payments

through an interbank payment system; or

‘‘(iii) settlement, netting, or novation of obligations

resulting from a sale of a commodity in a transaction

in the spot market for the commodity.

‘‘(10) ELECTRONIC TRADING FACILITY.—The term ‘electronic

trading facility’ means a trading facility that—

114 STAT. 2763A–368 PUBLIC LAW 106–554—APPENDIX E

‘‘(A) operates by means of an electronic or telecommunications network; and ‘‘(B) maintains an automated audit trail of bids, offers,

and the matching of orders or the execution of transactions

on the facility.

‘‘(11) ELIGIBLE COMMERCIAL ENTITY.—The term ‘eligible

commercial entity’ means, with respect to an agreement, contract or transaction in a commodity— ‘‘(A) an eligible contract participant described in clause

(i), (ii), (v), (vii), (viii), or (ix) of paragraph (12)(A) that,

in connection with its business— ‘‘(i) has a demonstrable ability, directly or through

separate contractual arrangements, to make or take

delivery of the underlying commodity; ‘‘(ii) incurs risks, in addition to price risk, related

to the commodity; or ‘‘(iii) is a dealer that regularly provides risk

management or hedging services to, or engages in market-making activities with, the foregoing entities

involving transactions to purchase or sell the commodity or derivative agreements, contracts, or transactions

in the commodity;

‘‘(B) an eligible contract participant, other than a natural person or an instrumentality, department, or agency

of a State or local governmental entity, that— ‘‘(i) regularly enters into transactions to purchase

or sell the commodity or derivative agreements, contracts, or transactions in the commodity; and

‘‘(ii) either—

‘‘(I) in the case of a collective investment

vehicle whose participants include persons other

than—

‘‘(aa) qualified eligible persons, as defined

in Commission rule 4.7(a) (17 CFR 4.7(a));

‘‘(bb) accredited investors, as defined in

Regulation D of the Securities and Exchange

Commission under the Securities Act of 1933

(17 CFR 230.501(a)), with total assets of

$2,000,000; or

‘‘(cc) qualified purchasers, as defined in

section 2(a)(51)(A) of the Investment Company

Act of 1940;

in each case as in effect on the date of the enactment of the Commodity Futures Modernization Act

of 2000, has, or is one of a group of vehicles under

common control or management having in the

aggregate, $1,000,000,000 in total assets; or

‘‘(II) in the case of other persons, has, or is

one of a group of persons under common control

or management having in the aggregate,

$100,000,000 in total assets; or

‘‘(C) such other persons as the Commission shall determine appropriate and shall designate by rule, regulation,

or order.

‘‘(12) ELIGIBLE CONTRACT PARTICIPANT.—The term ‘eligible

contract participant’ means— ‘‘(A) acting for its own account—

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–369

‘‘(i) a financial institution;

‘‘(ii) an insurance company that is regulated by

a State, or that is regulated by a foreign government

and is subject to comparable regulation as determined

by the Commission, including a regulated subsidiary

or affiliate of such an insurance company;

‘‘(iii) an investment company subject to regulation

under the Investment Company Act of 1940 (15 U.S.C.

80a–1 et seq.) or a foreign person performing a similar

role or function subject as such to foreign regulation

(regardless of whether each investor in the investment

company or the foreign person is itself an eligible contract participant);

‘‘(iv) a commodity pool that—

‘‘(I) has total assets exceeding $5,000,000; and

‘‘(II) is formed and operated by a person subject to regulation under this Act or a foreign person

performing a similar role or function subject as

such to foreign regulation (regardless of whether

each investor in the commodity pool or the foreign

person is itself an eligible contract participant);

‘‘(v) a corporation, partnership, proprietorship,

organization, trust, or other entity—

‘‘(I) that has total assets exceeding

$10,000,000;

‘‘(II) the obligations of which under an agreement, contract, or transaction are guaranteed or

otherwise supported by a letter of credit or

keepwell, support, or other agreement by an entity

described in subclause (I), in clause (i), (ii), (iii),

(iv), or (vii), or in subparagraph (C); or

‘‘(III) that—

‘‘(aa) has a net worth exceeding

$1,000,000; and

‘‘(bb) enters into an agreement, contract,

or transaction in connection with the conduct

of the entity’s business or to manage the risk

associated with an asset or liability owned

or incurred or reasonably likely to be owned

or incurred by the entity in the conduct of

the entity’s business;

‘‘(vi) an employee benefit plan subject to the

Employee Retirement Income Security Act of 1974 (29

U.S.C. 1001 et seq.), a governmental employee benefit

plan, or a foreign person performing a similar role

or function subject as such to foreign regulation—

‘‘(I) that has total assets exceeding $5,000,000;

or

‘‘(II) the investment decisions of which are

made by—

‘‘(aa) an investment adviser or commodity

trading advisor subject to regulation under the

Investment Advisers Act of 1940 (15 U.S.C.

80b–1 et seq.) or this Act;

‘‘(bb) a foreign person performing a similar

role or function subject as such to foreign regulation;

114 STAT. 2763A–370 PUBLIC LAW 106–554—APPENDIX E

‘‘(cc) a financial institution; or

‘‘(dd) an insurance company described in

clause (ii), or a regulated subsidiary or affiliate

of such an insurance company;

‘‘(vii)(I) a governmental entity (including the

United States, a State, or a foreign government) or

political subdivision of a governmental entity;

‘‘(II) a multinational or supranational government

entity; or

‘‘(III) an instrumentality, agency, or department

of an entity described in subclause (I) or (II);

except that such term does not include an entity,

instrumentality, agency, or department referred to in

subclause (I) or (III) of this clause unless (aa) the

entity, instrumentality, agency, or department is a person described in clause (i), (ii), or (iii) of section

1a(11)(A); (bb) the entity, instrumentality, agency, or

department owns and invests on a discretionary basis

$25,000,000 or more in investments; or (cc) the agreement, contract, or transaction is offered by, and entered

into with, an entity that is listed in any of subclauses

(I) through (VI) of section 2(c)(2)(B)(ii);

‘‘(viii)(I) a broker or dealer subject to regulation

under the Securities Exchange Act of 1934 (15 U.S.C.

78a et seq.) or a foreign person performing a similar

role or function subject as such to foreign regulation,

except that, if the broker or dealer or foreign person

is a natural person or proprietorship, the broker or

dealer or foreign person shall not be considered to

be an eligible contract participant unless the broker

or dealer or foreign person also meets the requirements

of clause (v) or (xi);

‘‘(II) an associated person of a registered broker

or dealer concerning the financial or securities activities of which the registered person makes and keeps

records under section 15C(b) or 17(h) of the Securities

Exchange Act of 1934 (15 U.S.C. 78o–5(b), 78q(h));

‘‘(III) an investment bank holding company (as

defined in section 17(i) of the Securities Exchange Act

of 1934 (15 U.S.C. 78q(i));

‘‘(ix) a futures commission merchant subject to

regulation under this Act or a foreign person performing a similar role or function subject as such to foreign

regulation, except that, if the futures commission merchant or foreign person is a natural person or

proprietorship, the futures commission merchant or

foreign person shall not be considered to be an eligible

contract participant unless the futures commission

merchant or foreign person also meets the requirements of clause (v) or (xi);

‘‘(x) a floor broker or floor trader subject to regulation under this Act in connection with any transaction

that takes place on or through the facilities of a registered entity or an exempt board of trade, or any

affiliate thereof, on which such person regularly trades;

or

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–371

‘‘(xi) an individual who has total assets in an

amount in excess of— ‘‘(I) $10,000,000; or

‘‘(II) $5,000,000 and who enters into the agreement, contract, or transaction in order to manage

the risk associated with an asset owned or liability

incurred, or reasonably likely to be owned or

incurred, by the individual;

‘‘(B)(i) a person described in clause (i), (ii), (iv), (v),

(viii), (ix), or (x) of subparagraph (A) or in subparagraph

(C), acting as broker or performing an equivalent agency

function on behalf of another person described in subparagraph (A) or (C); or

‘‘(ii) an investment adviser subject to regulation under

the Investment Advisers Act of 1940, a commodity trading

advisor subject to regulation under this Act, a foreign person performing a similar role or function subject as such

to foreign regulation, or a person described in clause (i),

(ii), (iv), (v), (viii), (ix), or (x) of subparagraph (A) or in

subparagraph (C), in any such case acting as investment

manager or fiduciary (but excluding a person acting as

broker or performing an equivalent agency function) for

another person described in subparagraph (A) or (C) and

who is authorized by such person to commit such person

to the transaction; or

‘‘(C) any other person that the Commission determines

to be eligible in light of the financial or other qualifications

of the person.

‘‘(13) EXCLUDED COMMODITY.—The term ‘excluded commodity’ means—

‘‘(i) an interest rate, exchange rate, currency, security, security index, credit risk or measure, debt or

equity instrument, index or measure of inflation, or

other macroeconomic index or measure;

‘‘(ii) any other rate, differential, index, or measure

of economic or commercial risk, return, or value that

is—

‘‘(I) not based in substantial part on the value

of a narrow group of commodities not described

in clause (i); or

‘‘(II) based solely on one or more commodities

that have no cash market;

‘‘(iii) any economic or commercial index based on

prices, rates, values, or levels that are not within the

control of any party to the relevant contract, agreement, or transaction; or

‘‘(iv) an occurrence, extent of an occurrence, or

contingency (other than a change in the price, rate,

value, or level of a commodity not described in clause

(i)) that is—

‘‘(I) beyond the control of the parties to the

relevant contract, agreement, or transaction; and

‘‘(II) associated with a financial, commercial,

or economic consequence.

‘‘(14) EXEMPT COMMODITY.—The term ‘exempt commodity’ means a commodity that is not an excluded commodity or

an agricultural commodity.

114 STAT. 2763A–372 PUBLIC LAW 106–554—APPENDIX E

‘‘(15) FINANCIAL INSTITUTION.—The term ‘financial institution’ means— ‘‘(A) a corporation operating under the fifth undesignated paragraph of section 25 of the Federal Reserve Act

(12 U.S.C. 603), commonly known as ‘an agreement corporation’;

‘‘(B) a corporation organized under section 25A of the

Federal Reserve Act (12 U.S.C. 611 et seq.), commonly

known as an ‘Edge Act corporation’;

‘‘(C) an institution that is regulated by the Farm Credit

Administration;

‘‘(D) a Federal credit union or State credit union (as

defined in section 101 of the Federal Credit Union Act

(12 U.S.C. 1752));

‘‘(E) a depository institution (as defined in section 3

of the Federal Deposit Insurance Act (12 U.S.C. 1813));

‘‘(F) a foreign bank or a branch or agency of a foreign

bank (each as defined in section 1(b) of the International

Banking Act of 1978 (12 U.S.C. 3101(b)));

‘‘(G) any financial holding company (as defined in section 2 of the Bank Holding Company Act of 1956);

‘‘(H) a trust company; or

‘‘(I) a similarly regulated subsidiary or affiliate of an

entity described in any of subparagraphs (A) through (H).’’;

(5) by inserting after paragraph (20) (as redesignated by

paragraph (1)) the following:

‘‘(21) HYBRID INSTRUMENT.—The term ‘hybrid instrument’

means a security having one or more payments indexed to

the value, level, or rate of, or providing for the delivery of,

one or more commodities.’’;

(6) by striking paragraph (24) (as redesignated by paragraph (1)) and inserting the following:

‘‘(24) MEMBER OF A CONTRACT MARKET; MEMBER OF A

DERIVATIVES TRANSACTION EXECUTION FACILITY.—The term

‘member’ means, with respect to a contract market or derivatives transaction execution facility, an individual, association,

partnership, corporation, or trust—

‘‘(A) owning or holding membership in, or admitted

to membership representation on, the contract market or

derivatives transaction execution facility; or

‘‘(B) having trading privileges on the contract market

or derivatives transaction execution facility.

‘‘(25) NARROW-BASED SECURITY INDEX.—

‘‘(A) The term ‘narrow-based security index’ means an

index—

‘‘(i) that has 9 or fewer component securities;

‘‘(ii) in which a component security comprises more

than 30 percent of the index’s weighting;

‘‘(iii) in which the five highest weighted component

securities in the aggregate comprise more than 60 percent of the index’s weighting; or ‘‘(iv) in which the lowest weighted component securities comprising, in the aggregate, 25 percent of the

index’s weighting have an aggregate dollar value of

average daily trading volume of less than $50,000,000

(or in the case of an index with 15 or more component

securities, $30,000,000), except that if there are two

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–373

or more securities with equal weighting that could

be included in the calculation of the lowest weighted

component securities comprising, in the aggregate, 25

percent of the index’s weighting, such securities shall

be ranked from lowest to highest dollar value of average daily trading volume and shall be included in

the calculation based on their ranking starting with

the lowest ranked security.

‘‘(B) Notwithstanding subparagraph (A), an index is

not a narrow-based security index if—

‘‘(i)(I) it has at least 9 component securities;

‘‘(II) no component security comprises more than

30 percent of the index’s weighting; and

‘‘(III) each component security is—

‘‘(aa) registered pursuant to section 12 of the

Securities Exchange Act of 1934;

‘‘(bb) one of 750 securities with the largest

market capitalization; and

‘‘(cc) one of 675 securities with the largest

dollar value of average daily trading volume;

‘‘(ii) a board of trade was designated as a contract

market by the Commodity Futures Trading Commission with respect to a contract of sale for future delivery on the index, before the date of the enactment

of the Commodity Futures Modernization Act of 2000;

‘‘(iii)(I) a contract of sale for future delivery on

the index traded on a designated contract market or

registered derivatives transaction execution facility for

at least 30 days as a contract of sale for future delivery

on an index that was not a narrow-based security

index; and

‘‘(II) it has been a narrow-based security index

for no more than 45 business days over 3 consecutive

calendar months;

‘‘(iv) a contract of sale for future delivery on the

index is traded on or subject to the rules of a foreign

board of trade and meets such requirements as are

jointly established by rule or regulation by the Commission and the Securities and Exchange Commission;

‘‘(v) no more than 18 months have passed since

the date of the enactment of the Commodity Futures

Modernization Act of 2000 and—

‘‘(I) it is traded on or subject to the rules

of a foreign board of trade;

‘‘(II) the offer and sale in the United States

of a contract of sale for future delivery on the

index was authorized before the date of the enactment of the Commodity Futures Modernization Act

of 2000; and

‘‘(III) the conditions of such authorization continue to be met; or

‘‘(vi) a contract of sale for future delivery on the

index is traded on or subject to the rules of a board

of trade and meets such requirements as are jointly

established by rule, regulation, or order by the

Commission and the Securities and Exchange Commission.

114 STAT. 2763A–374 PUBLIC LAW 106–554—APPENDIX E

‘‘(C) Within 1 year after the date of the enactment

of the Commodity Futures Modernization Act of 2000, the

Commission and the Securities and Exchange Commission

jointly shall adopt rules or regulations that set forth the

requirements under subparagraph (B)(iv).

‘‘(D) An index that is a narrow-based security index

solely because it was a narrow-based security index for

more than 45 business days over 3 consecutive calendar

months pursuant to clause (iii) of subparagraph (B) shall

not be a narrow-based security index for the 3 following

calendar months.

‘‘(E) For purposes of subparagraphs (A) and (B)—

‘‘(i) the dollar value of average daily trading volume and the market capitalization shall be calculated

as of the preceding 6 full calendar months; and

‘‘(ii) the Commission and the Securities and

Exchange Commission shall, by rule or regulation,

jointly specify the method to be used to determine

market capitalization and dollar value of average daily

trading volume.

‘‘(26) OPTION.—The term ‘option’ means an agreement, contract, or transaction that is of the character of, or is commonly

known to the trade as, an ‘option’, ‘privilege’, ‘indemnity’, ‘bid’,

‘offer’, ‘put’, ‘call’, ‘advance guaranty’, or ‘decline guaranty’.

‘‘(27) ORGANIZED EXCHANGE.—The term ‘organized

exchange’ means a trading facility that—

‘‘(A) permits trading—

‘‘(i) by or on behalf of a person that is not an

eligible contract participant; or

‘‘(ii) by persons other than on a principal-to-principal basis; or

‘‘(B) has adopted (directly or through another nongovernmental entity) rules that—

‘‘(i) govern the conduct of participants, other than

rules that govern the submission of orders or execution

of transactions on the trading facility; and

‘‘(ii) include disciplinary sanctions other than the

exclusion of participants from trading.’’; and

(7) by adding at the end the following:

‘‘(29) REGISTERED ENTITY.—The term ‘registered entity’

means—

‘‘(A) a board of trade designated as a contract market

under section 5;

‘‘(B) a derivatives transaction execution facility registered under section 5a;

‘‘(C) a derivatives clearing organization registered

under section 5b; and

‘‘(D) a board of trade designated as a contract market

under section 5f.

‘‘(30) SECURITY.—The term ‘security’ means a security as

defined in section 2(a)(1) of the Securities Act of 1933 (15

U.S.C. 77b(a)(1)) or section 3(a)(10) of the Securities Exchange

Act of 1934 (15 U.S.C. 78c(a)(10)).

‘‘(31) SECURITY FUTURE.—The term ‘security future’ means

a contract of sale for future delivery of a single security or

of a narrow-based security index, including any interest therein

or based on the value thereof, except an exempted security

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–375

under section 3(a)(12) of the Securities Exchange Act of 1934

as in effect on the date of the enactment of the Futures Trading

Act of 1982 (other than any municipal security as defined

in section 3(a)(29) of the Securities Exchange Act of 1934 as

in effect on the date of the enactment of the Futures Trading

Act of 1982). The term ‘security future’ does not include any

agreement, contract, or transaction excluded from this Act

under section 2(c), 2(d), 2(f ), or 2(g) of this Act (as in effect

on the date of the enactment of the Commodity Futures Modernization Act of 2000) or title IV of the Commodity Futures

Modernization Act of 2000.

‘‘(32) SECURITY FUTURES PRODUCT.—The term ‘security

futures product’ means a security future or any put, call, straddle, option, or privilege on any security future.

‘‘(33) TRADING FACILITY.—

‘‘(A) IN GENERAL.—The term ‘trading facility’ means

a person or group of persons that constitutes, maintains,

or provides a physical or electronic facility or system in

which multiple participants have the ability to execute

or trade agreements, contracts, or transactions by accepting

bids and offers made by other participants that are open

to multiple participants in the facility or system.

‘‘(B) EXCLUSIONS.—The term ‘trading facility’ does not

include—

‘‘(i) a person or group of persons solely because

the person or group of persons constitutes, maintains,

or provides an electronic facility or system that enables

participants to negotiate the terms of and enter into

bilateral transactions as a result of communications

exchanged by the parties and not from interaction

of multiple bids and multiple offers within a predetermined, nondiscretionary automated trade matching

and execution algorithm;

‘‘(ii) a government securities dealer or government

securities broker, to the extent that the dealer or

broker executes or trades agreements, contracts, or

transactions in government securities, or assists persons in communicating about, negotiating, entering

into, executing, or trading an agreement, contract, or

transaction in government securities (as the terms

‘government securities dealer’, ‘government securities

broker’, and ‘government securities’ are defined in section 3(a) of the Securities Exchange Act of 1934 (15

U.S.C. 78c(a))); or

‘‘(iii) facilities on which bids and offers, and acceptances of bids and offers effected on the facility, are

not binding.

Any person, group of persons, dealer, broker, or facility

described in clause (i) or (ii) is excluded from the meaning

of the term ‘trading facility’ for the purposes of this Act

without any prior specific approval, certification, or other

action by the Commission.

‘‘(C) SPECIAL RULE.—A person or group of persons that

would not otherwise constitute a trading facility shall not

be considered to be a trading facility solely as a result

of the submission to a derivatives clearing organization

114 STAT. 2763A–376 PUBLIC LAW 106–554—APPENDIX E

of transactions executed on or through the person or group

of persons.’’.

SEC. 102. AGREEMENTS, CONTRACTS, AND TRANSACTIONS IN FOREIGN

CURRENCY, GOVERNMENT SECURITIES, AND CERTAIN

OTHER COMMODITIES.

Section 2 of the Commodity Exchange Act (7 U.S.C. 2, 2a,

3, 4, 4a) is amended by adding at the end the following:

‘‘(c) AGREEMENTS, CONTRACTS, AND TRANSACTIONS IN FOREIGN

CURRENCY, GOVERNMENT SECURITIES, AND CERTAIN OTHER

COMMODITIES.—

‘‘(1) IN GENERAL.—Except as provided in paragraph (2),

nothing in this Act (other than section 5a (to the extent provided

in section 5a(g)), 5b, 5d, or 12(e)(2)(B)) governs or applies

to an agreement, contract, or transaction in—

‘‘(A) foreign currency;

‘‘(B) government securities;

‘‘(C) security warrants;

‘‘(D) security rights;

‘‘(E) resales of installment loan contracts;

‘‘(F) repurchase transactions in an excluded commodity;

or

‘‘(G) mortgages or mortgage purchase commitments.

‘‘(2) COMMISSION JURISDICTION.—

‘‘(A) AGREEMENTS, CONTRACTS, AND TRANSACTIONS

TRADED ON AN ORGANIZED EXCHANGE.—This Act applies

to, and the Commission shall have jurisdiction over, an

agreement, contract, or transaction described in paragraph

(1) that is—

‘‘(i) a contract of sale of a commodity for future

delivery (or an option on such a contract), or an option

on a commodity (other than foreign currency or a security or a group or index of securities), that is executed

or traded on an organized exchange; or

‘‘(ii) an option on foreign currency executed or

traded on an organized exchange that is not a national

securities exchange registered pursuant to section 6(a)

of the Securities Exchange Act of 1934.

‘‘(B) AGREEMENTS, CONTRACTS, AND TRANSACTIONS IN

RETAIL FOREIGN CURRENCY.—This Act applies to, and the

Commission shall have jurisdiction over, an agreement,

contract, or transaction in foreign currency that—

‘‘(i) is a contract of sale of a commodity for future

delivery (or an option on such a contract) or an option

(other than an option executed or traded on a national

securities exchange registered pursuant to section 6(a)

of the Securities Exchange Act of 1934); and

‘‘(ii) is offered to, or entered into with, a person

that is not an eligible contract participant, unless the

counterparty, or the person offering to be the

counterparty, of the person is—

‘‘(I) a financial institution;

‘‘(II) a broker or dealer registered under section 15(b) or 15C of the Securities Exchange Act

of 1934 (15 U.S.C. 78o(b), 78o–5) or a futures

commission merchant registered under this Act;

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–377

‘‘(III) an associated person of a broker or dealer

registered under section 15(b) or 15C of the Securities Exchange Act of 1934 (15 U.S.C. 78o(b), 78o–

5), or an affiliated person of a futures commission

merchant registered under this Act, concerning the

financial or securities activities of which the registered person makes and keeps records under section 15C(b) or 17(h) of the Securities Exchange

Act of 1934 (15 U.S.C. 78o–5(b), 78q(h)) or section

4f(c)(2)(B) of this Act;

‘‘(IV) an insurance company described in section 1a(12)(A)(ii) of this Act, or a regulated subsidiary or affiliate of such an insurance company;

‘‘(V) a financial holding company (as defined

in section 2 of the Bank Holding Company Act

of 1956); or

‘‘(VI) an investment bank holding company (as

defined in section 17(i) of the Securities Exchange

Act of 1934).

‘‘(C) Notwithstanding subclauses (II) and (III) of

subparagraph (B)(ii), agreements, contracts, or transactions

described in subparagraph (B) shall be subject to sections

4b, 4c(b), 6(c) and 6(d) (to the extent that sections 6(c)

and 6(d) prohibit manipulation of the market price of any

commodity, in interstate commerce, or for future delivery

on or subject to the rules of any market), 6c, 6d, and

8(a) if they are entered into by a futures commission merchant or an affiliate of a futures commission merchant

that is not also an entity described in subparagraph (B)(ii)

of this paragraph.’’.

SEC. 103. LEGAL CERTAINTY FOR EXCLUDED DERIVATIVE TRANSACTIONS.

Section 2 of the Commodity Exchange Act (7 U.S.C. 2, 2a,

3, 4, 4a) is further amended by adding at the end the following:

‘‘(d) EXCLUDED DERIVATIVE TRANSACTIONS.—

‘‘(1) IN GENERAL.—Nothing in this Act (other than section

5b or 12(e)(2)(B) governs or applies to an agreement, contract,

or transaction in an excluded commodity if—

‘‘(A) the agreement, contract, or transaction is entered

into only between persons that are eligible contract participants at the time at which the persons enter into the

agreement, contract, or transaction; and

‘‘(B) the agreement, contract, or transaction is not

executed or traded on a trading facility.

‘‘(2) ELECTRONIC TRADING FACILITY EXCLUSION.—Nothing

in this Act (other than section 5a (to the extent provided

in section 5a(g)), 5b, 5d, or 12(e)(2)(B)) governs or applies

to an agreement, contract, or transaction in an excluded

commodity if—

‘‘(A) the agreement, contract, or transaction is entered

into on a principal-to-principal basis between parties trading for their own accounts or as described in section

1a(12)(B)(ii);

114 STAT. 2763A–378 PUBLIC LAW 106–554—APPENDIX E

‘‘(B) the agreement, contract, or transaction is entered

into only between persons that are eligible contract participants described in subparagraph (A), (B)(ii), or (C) of section 1a(12)) at the time at which the persons enter into

the agreement, contract, or transaction; and ‘‘(C) the agreement, contract, or transaction is executed

or traded on an electronic trading facility.’’.

SEC. 104. EXCLUDED ELECTRONIC TRADING FACILITIES.

Section 2 of the Commodity Exchange Act (7 U.S.C. 2, 2a,

3, 4, 4a) is further amended by adding at the end the following: ‘‘(e) EXCLUDED ELECTRONIC TRADING FACILITIES.— ‘‘(1) IN GENERAL.—Nothing in this Act (other than section

12(e)(2)(B)) governs or is applicable to an electronic trading

facility that limits transactions authorized to be conducted on

its facilities to those satisfying the requirements of section

2(d)(2), 2(g), or 2(h)(3). ‘‘(2) EFFECT ON AUTHORITY TO ESTABLISH AND OPERATE.— Nothing in this Act shall prohibit a board of trade designated

by the Commission as a contract market or derivatives transaction execution facility, or operating as an exempt board of

trade from establishing and operating an electronic trading

facility excluded under this Act pursuant to paragraph (1). ‘‘(3) EFFECT ON TRANSACTIONS.—No failure by an electronic

trading facility to limit transactions as required by paragraph

(1) of this subsection or to comply with section 2(h)(5) shall

in itself affect the legality, validity, or enforceability of an

agreement, contract, or transaction entered into or traded on

the electronic trading facility or cause a participant on the

system to be in violation of this Act. ‘‘(4) SPECIAL RULE.—A person or group of persons that

would not otherwise constitute a trading facility shall not be

considered to be a trading facility solely as a result of the

submission to a derivatives clearing organization of transactions

executed on or through the person or group of persons.’’.

SEC. 105. HYBRID INSTRUMENTS; SWAP TRANSACTIONS.

(a) HYBRID INSTRUMENTS.—Section 2 of the Commodity

Exchange Act (7 U.S.C. 2, 2a, 3, 4, 4a) is further amended by

adding at the end the following: ‘‘(f ) EXCLUSION FOR QUALIFYING HYBRID INSTRUMENTS.— ‘‘(1) IN GENERAL.—Nothing in this Act (other than section

12(e)(2)(B)) governs or is applicable to a hybrid instrument

that is predominantly a security. ‘‘(2) PREDOMINANCE.—A hybrid instrument shall be considered to be predominantly a security if— ‘‘(A) the issuer of the hybrid instrument receives payment in full of the purchase price of the hybrid instrument,

substantially contemporaneously with delivery of the

hybrid instrument;

‘‘(B) the purchaser or holder of the hybrid instrument

is not required to make any payment to the issuer in

addition to the purchase price paid under subparagraph

(A), whether as margin, settlement payment, or otherwise,

during the life of the hybrid instrument or at maturity;

‘‘(C) the issuer of the hybrid instrument is not subject

by the terms of the instrument to mark-to-market margining requirements; and

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–379

‘‘(D) the hybrid instrument is not marketed as a contract of sale of a commodity for future delivery (or option

on such a contract) subject to this Act.

‘‘(3) MARK-TO-MARKET MARGINING REQUIREMENTS.—For the

purposes of paragraph (2)(C), mark-to-market margining

requirements do not include the obligation of an issuer of

a secured debt instrument to increase the amount of collateral

held in pledge for the benefit of the purchaser of the secured

debt instrument to secure the repayment obligations of the

issuer under the secured debt instrument.’’.

(b) SWAP TRANSACTIONS.—Section 2 of the Commodity

Exchange Act (7 U.S.C. 2, 2a, 3, 4, 4a) is further amended by

adding at the end the following:

‘‘(g) EXCLUDED SWAP TRANSACTIONS.—No provision of this Act

(other than section 5a (to the extent provided in section 5a(g)),

5b, 5d, or 12(e)(2)) shall apply to or govern any agreement, contract,

or transaction in a commodity other than an agricultural commodity

if the agreement, contract, or transaction is—

‘‘(1) entered into only between persons that are eligible

contract participants at the time they enter into the agreement,

contract, or transaction;

‘‘(2) subject to individual negotiation by the parties; and

‘‘(3) not executed or traded on a trading facility.’’.

(c) STUDY REGARDING RETAIL SWAPS.—

(1) IN GENERAL.—The Board of Governors of the Federal

Reserve System, the Secretary of the Treasury, the Commodity

Futures Trading Commission, and the Securities and Exchange

Commission shall conduct a study of issues involving the offering of swap agreements to persons other than eligible contract

participants (as defined in section 1a of the Commodity

Exchange Act).

(2) MATTERS TO BE ADDRESSED.—The study shall address—

(A) the potential uses of swap agreements by persons

other than eligible contract participants;

(B) the extent to which financial institutions are willing

to offer swap agreements to persons other than eligible

contract participants;

(C) the appropriate regulatory structure to address

customer protection issues that may arise in connection

with the offer of swap agreements to persons other than

eligible contract participants; and

(D) such other relevant matters deemed necessary or

appropriate to address.

(3) REPORT.—Before the end of the 1-year period beginning

on the date of the enactment of this Act, a report on the

findings and conclusions of the study required by paragraph

(1) shall be submitted to Congress, together with such recommendations for legislative action as are deemed necessary

and appropriate.

SEC. 106. TRANSACTIONS IN EXEMPT COMMODITIES.

Section 2 of the Commodity Exchange Act (7 U.S.C. 2, 2a,

3, 4, 4a) is further amended by adding at the end the following:

‘‘(h) LEGAL CERTAINTY FOR CERTAIN TRANSACTIONS IN EXEMPT

COMMODITIES.—

114 STAT. 2763A–380 PUBLIC LAW 106–554—APPENDIX E

‘‘(1) Except as provided in paragraph (2), nothing in this

Act shall apply to a contract, agreement, or transaction in

an exempt commodity which— ‘‘(A) is entered into solely between persons that are

eligible contract participants at the time the persons enter

into the agreement, contract, or transaction; and

‘‘(B) is not entered into on a trading facility.

‘‘(2) An agreement, contract, or transaction described in

paragraph (1) of this subsection shall be subject to—

‘‘(A) sections 5b and 12(e)(2)(B);

‘‘(B) sections 4b, 4o, 6(c), 6(d), 6c, 6d, and 8a, and

the regulations of the Commission pursuant to section 4c(b)

proscribing fraud in connection with commodity option

transactions, to the extent the agreement, contract, or

transaction is not between eligible commercial entities

(unless one of the entities is an instrumentality, department, or agency of a State or local governmental entity)

and would otherwise be subject to such sections and regulations; and

‘‘(C) sections 6(c), 6(d), 6c, 6d, 8a, and 9(a)(2), to the

extent such sections prohibit manipulation of the market

price of any commodity in interstate commerce and the

agreement, contract, or transaction would otherwise be subject to such sections.

‘‘(3) Except as provided in paragraph (4), nothing in this

Act shall apply to an agreement, contract, or transaction in

an exempt commodity which is—

‘‘(A) entered into on a principal-to-principal basis solely

between persons that are eligible commercial entities at

the time the persons enter into the agreement, contract,

or transaction; and

‘‘(B) executed or traded on an electronic trading facility.

‘‘(4) An agreement, contract, or transaction described in

paragraph (3) of this subsection shall be subject to—

‘‘(A) sections 5a (to the extent provided in section 5a(g)),

5b, 5d, and 12(e)(2)(B);

‘‘(B) sections 4b and 4o and the regulations of the

Commission pursuant to section 4c(b) proscribing fraud

in connection with commodity option transactions to the

extent the agreement, contract, or transaction would otherwise be subject to such sections and regulations;

‘‘(C) sections 6(c) and 9(a)(2), to the extent such sections

prohibit manipulation of the market price of any commodity

in interstate commerce and to the extent the agreement,

contract, or transaction would otherwise be subject to such

sections; and

‘‘(D) such rules and regulations as the Commission

may prescribe if necessary to ensure timely dissemination

by the electronic trading facility of price, trading volume,

and other trading data to the extent appropriate, if the

Commission determines that the electronic trading facility

performs a significant price discovery function for transactions in the cash market for the commodity underlying

any agreement, contract, or transaction executed or traded

on the electronic trading facility.

‘‘(5) An electronic trading facility relying on the exemption

provided in paragraph (3) shall—

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–381

‘‘(A) notify the Commission of its intention to operate

an electronic trading facility in reliance on the exemption

set forth in paragraph (3), which notice shall include— ‘‘(i) the name and address of the facility and a

person designated to receive communications from the

Commission;

‘‘(ii) the commodity categories that the facility

intends to list or otherwise make available for trading

on the facility in reliance on the exemption set forth

in paragraph (3);

‘‘(iii) certifications that—

‘‘(I) no executive officer or member of the

governing board of, or any holder of a 10 percent

or greater equity interest in, the facility is a person

described in any of subparagraphs (A) through

(H) of section 8a(2);

‘‘(II) the facility will comply with the conditions for exemption under this paragraph; and

‘‘(III) the facility will notify the Commission

of any material change in the information previously provided by the facility to the Commission

pursuant to this paragraph; and

‘‘(iv) the identity of any derivatives clearing

organization to which the facility transmits or intends

to transmit transaction data for the purpose of facilitating the clearance and settlement of transactions conducted on the facility in reliance on the exemption

set forth in paragraph (3);

‘‘(B)(i)(I) provide the Commission with access to the

facility’s trading protocols and electronic access to the facility with respect to transactions conducted in reliance on

the exemption set forth in paragraph (3); or

‘‘(II) provide such reports to the Commission regarding

transactions executed on the facility in reliance on the

exemption set forth in paragraph (3) as the Commission

may from time to time request to enable the Commission

to satisfy its obligations under this Act;

‘‘(ii) maintain for 5 years, and make available for

inspection by the Commission upon request, records of

activities related to its business as an electronic trading

facility exempt under paragraph (3), including—

‘‘(I) information relating to data entry and transaction details sufficient to enable the Commission to

reconstruct trading activity on the facility conducted

in reliance on the exemption set forth in paragraph

(3); and

‘‘(II) the name and address of each participant

on the facility authorized to enter into transactions

in reliance on the exemption set forth in paragraph

(3); and

‘‘(iii) upon special call by the Commission, provide to

the Commission, in a form and manner and within the

period specified in the special call, such information related

to its business as an electronic trading facility exempt

under paragraph (3), including information relating to data

entry and transaction details in respect of transactions

entered into in reliance on the exemption set forth in

114 STAT. 2763A–382 PUBLIC LAW 106–554—APPENDIX E

paragraph (3), as the Commission may determine

appropriate— ‘‘(I) to enforce the provisions specified in subparagraphs (B) and (C) of paragraph (4);

‘‘(II) to evaluate a systemic market event; or

‘‘(III) to obtain information requested by a Federal

financial regulatory authority in order to enable the

regulator to fulfill its regulatory or supervisory responsibilities;

‘‘(C)(i) upon receipt of any subpoena issued by or on

behalf of the Commission to any foreign person who the

Commission believes is conducting or has conducted transactions in reliance on the exemption set forth in paragraph

(3) on or through the electronic trading facility relating

to the transactions, promptly notify the foreign person of,

and transmit to the foreign person, the subpoena in a

manner reasonable under the circumstances, or as specified

by the Commission; and

‘‘(ii) if the Commission has reason to believe that a

person has not timely complied with a subpoena issued

by or on behalf of the Commission pursuant to clause

(i), and the Commission in writing has directed that a

facility relying on the exemption set forth in paragraph

(3) deny or limit further transactions by the person, the

facility shall deny that person further trading access to

the facility or, as applicable, limit that person’s access

to the facility for liquidation trading only;

‘‘(D) comply with the requirements of this paragraph

applicable to the facility and require that each participant,

as a condition of trading on the facility in reliance on

the exemption set forth in paragraph (3), agree to comply

with all applicable law;

‘‘(E) have a reasonable basis for believing that participants authorized to conduct transactions on the facility

in reliance on the exemption set forth in paragraph (3)

are eligible commercial entities; and

‘‘(F) not represent to any person that the facility is

registered with, or designated, recognized, licensed, or

approved by the Commission.

‘‘(6) A person named in a subpoena referred to in paragraph

(5)(C) that believes the person is or may be adversely affected

or aggrieved by action taken by the Commission under this

section, shall have the opportunity for a prompt hearing after

the Commission acts under procedures that the Commission

shall establish by rule, regulation, or order.’’.

SEC. 107. APPLICATION OF COMMODITY FUTURES LAWS.

Section 2 of the Commodity Exchange Act (7 U.S.C. 2, 2a,

3, 4, 4a) is further amended by adding at the end the following:

‘‘(i) APPLICATION OF COMMODITY FUTURES LAWS.—

‘‘(1) No provision of this Act shall be construed as implying

or creating any presumption that—

‘‘(A) any agreement, contract, or transaction that is

excluded from this Act under section 2(c), 2(d), 2(e), 2(f ),

or 2(g) of this Act or title IV of the Commodity Futures

Modernization Act of 2000, or exempted under section 2(h)

or 4(c) of this Act; or

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–383

‘‘(B) any agreement, contract, or transaction, not otherwise subject to this Act, that is not so excluded or exempted,

is or would otherwise be subject to this Act. ‘‘(2) No provision of, or amendment made by, the Commodity Futures Modernization Act of 2000 shall be construed as

conferring jurisdiction on the Commission with respect to any

such agreement, contract, or transaction, except as expressly

provided in section 5a of this Act (to the extent provided in

section 5a(g) of this Act), 5b of this Act, or 5d of this Act.’’.

SEC. 108. PROTECTION OF THE PUBLIC INTEREST.

The Commodity Exchange Act is amended by striking section

3 (7 U.S.C. 5) and inserting the following:

‘‘SEC. 3. FINDINGS AND PURPOSE.

‘‘(a) FINDINGS.—The transactions subject to this Act are entered

into regularly in interstate and international commerce and are

affected with a national public interest by providing a means for

managing and assuming price risks, discovering prices, or disseminating pricing information through trading in liquid, fair and financially secure trading facilities. ‘‘(b) PURPOSE.—It is the purpose of this Act to serve the public

interests described in subsection (a) through a system of effective

self-regulation of trading facilities, clearing systems, market participants and market professionals under the oversight of the Commission. To foster these public interests, it is further the purpose

of this Act to deter and prevent price manipulation or any other

disruptions to market integrity; to ensure the financial integrity

of all transactions subject to this Act and the avoidance of systemic

risk; to protect all market participants from fraudulent or other

abusive sales practices and misuses of customer assets; and to

promote responsible innovation and fair competition among boards

of trade, other markets and market participants.’’.

SEC. 109. PROHIBITED TRANSACTIONS.

Section 4c of the Commodity Exchange Act (7 U.S.C. 6c) is

amended by striking ‘‘SEC. 4c.’’ and all that follows through subsection (a) and inserting the following:

‘‘SEC. 4c. PROHIBITED TRANSACTIONS.

‘‘(a) IN GENERAL.—

‘‘(1) PROHIBITION.—It shall be unlawful for any person to

offer to enter into, enter into, or confirm the execution of

a transaction described in paragraph (2) involving the purchase

or sale of any commodity for future delivery (or any option

on such a transaction or option on a commodity) if the transaction is used or may be used to—

‘‘(A) hedge any transaction in interstate commerce in

the commodity or the product or byproduct of the commodity;

‘‘(B) determine the price basis of any such transaction

in interstate commerce in the commodity; or

‘‘(C) deliver any such commodity sold, shipped, or

received in interstate commerce for the execution of the

transaction.

‘‘(2) TRANSACTION.—A transaction referred to in paragraph

(1) is a transaction that—

114 STAT. 2763A–384 PUBLIC LAW 106–554—APPENDIX E

‘‘(A)(i) is, of the character of, or is commonly known

to the trade as, a ‘wash sale’ or ‘accommodation trade’;

or ‘‘(ii) is a fictitious sale; or

‘‘(B) is used to cause any price to be reported, registered, or recorded that is not a true and bona fide price.’’.

SEC. 110. DESIGNATION OF BOARDS OF TRADE AS CONTRACT MARKETS.

The Commodity Exchange Act is amended— (1) by redesignating section 5b (7 U.S.C. 7b) as section

5e; and

(2) by striking sections 5 and 5a (7 U.S.C. 7, 7a) and

inserting the following:

‘‘SEC. 5. DESIGNATION OF BOARDS OF TRADE AS CONTRACT MARKETS.

‘‘(a) APPLICATIONS.—A board of trade applying to the Commission for designation as a contract market shall submit an application

to the Commission that includes any relevant materials and records

the Commission may require consistent with this Act. ‘‘(b) CRITERIA FOR DESIGNATION.— ‘‘(1) IN GENERAL.—To be designated as a contract market,

the board of trade shall demonstrate to the Commission that

the board of trade meets the criteria specified in this subsection. ‘‘(2) PREVENTION OF MARKET MANIPULATION.—The board

of trade shall have the capacity to prevent market manipulation

through market surveillance, compliance, and enforcement

practices and procedures, including methods for conducting

real-time monitoring of trading and comprehensive and

accurate trade reconstructions. ‘‘(3) FAIR AND EQUITABLE TRADING.—The board of trade

shall establish and enforce trading rules to ensure fair and

equitable trading through the facilities of the contract market,

and the capacity to detect, investigate, and discipline any person that violates the rules. The rules may authorize— ‘‘(A) transfer trades or office trades;

‘‘(B) an exchange of— ‘‘(i) futures in connection with a cash commodity

transaction; ‘‘(ii) futures for cash commodities; or

‘‘(iii) futures for swaps; or ‘‘(C) a futures commission merchant, acting as principal

or agent, to enter into or confirm the execution of a contract

for the purchase or sale of a commodity for future delivery

if the contract is reported, recorded, or cleared in accordance with the rules of the contract market or a derivatives

clearing organization.

‘‘(4) TRADE EXECUTION FACILITY.—The board of trade

shall—

‘‘(A) establish and enforce rules defining, or specifications detailing, the manner of operation of the trade execution facility maintained by the board of trade, including

rules or specifications describing the operation of any electronic matching platform; and

‘‘(B) demonstrate that the trade execution facility operates in accordance with the rules or specifications.

‘‘(5) FINANCIAL INTEGRITY OF TRANSACTIONS.—The board

of trade shall establish and enforce rules and procedures for

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–385

ensuring the financial integrity of transactions entered into

by or through the facilities of the contract market, including

the clearance and settlement of the transactions with a derivatives clearing organization.

‘‘(6) DISCIPLINARY PROCEDURES.—The board of trade shall

establish and enforce disciplinary procedures that authorize

the board of trade to discipline, suspend, or expel members

or market participants that violate the rules of the board of

trade, or similar methods for performing the same functions,

including delegation of the functions to third parties.

‘‘(7) PUBLIC ACCESS.—The board of trade shall provide the

public with access to the rules, regulations, and contract specifications of the board of trade.

‘‘(8) ABILITY TO OBTAIN INFORMATION.—The board of trade

shall establish and enforce rules that will allow the board

of trade to obtain any necessary information to perform any

of the functions described in this subsection, including the

capacity to carry out such international information-sharing

agreements as the Commission may require.

‘‘(c) EXISTING CONTRACT MARKETS.—A board of trade that is

designated as a contract market on the date of the enactment

of the Commodity Futures Modernization Act of 2000 shall be

considered to be a designated contract market under this section.

‘‘(d) CORE PRINCIPLES FOR CONTRACT MARKETS.—

‘‘(1) IN GENERAL.—To maintain the designation of a board

of trade as a contract market, the board of trade shall comply

with the core principles specified in this subsection. The board

of trade shall have reasonable discretion in establishing the

manner in which it complies with the core principles.

‘‘(2) COMPLIANCE WITH RULES.—The board of trade shall

monitor and enforce compliance with the rules of the contract

market, including the terms and conditions of any contracts

to be traded and any limitations on access to the contract

market.

‘‘(3) CONTRACTS NOT READILY SUBJECT TO MANIPULATION.—

The board of trade shall list on the contract market only contracts that are not readily susceptible to manipulation.

‘‘(4) MONITORING OF TRADING.—The board of trade shall

monitor trading to prevent manipulation, price distortion, and

disruptions of the delivery or cash-settlement process.

‘‘(5) POSITION LIMITATIONS OR ACCOUNTABILITY.—To reduce

the potential threat of market manipulation or congestion, especially during trading in the delivery month, the board of trade

shall adopt position limitations or position accountability for

speculators, where necessary and appropriate.

‘‘(6) EMERGENCY AUTHORITY.—The board of trade shall

adopt rules to provide for the exercise of emergency authority,

in consultation or cooperation with the Commission, where

necessary and appropriate, including the authority to—

‘‘(A) liquidate or transfer open positions in any contract;

‘‘(B) suspend or curtail trading in any contract; and

‘‘(C) require market participants in any contract to

meet special margin requirements.

‘‘(7) AVAILABILITY OF GENERAL INFORMATION.—The board

of trade shall make available to market authorities, market

participants, and the public information concerning—

114 STAT. 2763A–386 PUBLIC LAW 106–554—APPENDIX E

‘‘(A) the terms and conditions of the contracts of the

contract market; and

‘‘(B) the mechanisms for executing transactions on or

through the facilities of the contract market.

‘‘(8) DAILY PUBLICATION OF TRADING INFORMATION.—The

board of trade shall make public daily information on settlement prices, volume, open interest, and opening and closing

ranges for actively traded contracts on the contract market.

‘‘(9) EXECUTION OF TRANSACTIONS.—The board of trade

shall provide a competitive, open, and efficient market and

mechanism for executing transactions.

‘‘(10) TRADE INFORMATION.—The board of trade shall maintain rules and procedures to provide for the recording and

safe storage of all identifying trade information in a manner

that enables the contract market to use the information for

purposes of assisting in the prevention of customer and market

abuses and providing evidence of any violations of the rules

of the contract market.

‘‘(11) FINANCIAL INTEGRITY OF CONTRACTS.—The board of

trade shall establish and enforce rules providing for the financial integrity of any contracts traded on the contract market

(including the clearance and settlement of the transactions

with a derivatives clearing organization), and rules to ensure

the financial integrity of any futures commission merchants

and introducing brokers and the protection of customer funds.

‘‘(12) PROTECTION OF MARKET PARTICIPANTS.—The board

of trade shall establish and enforce rules to protect market

participants from abusive practices committed by any party

acting as an agent for the participants.

‘‘(13) DISPUTE RESOLUTION.—The board of trade shall establish and enforce rules regarding and provide facilities for alternative dispute resolution as appropriate for market participants

and any market intermediaries.

‘‘(14) GOVERNANCE FITNESS STANDARDS.—The board of trade

shall establish and enforce appropriate fitness standards for

directors, members of any disciplinary committee, members

of the contract market, and any other persons with direct

access to the facility (including any parties affiliated with any

of the persons described in this paragraph).

‘‘(15) CONFLICTS OF INTEREST.—The board of trade shall

establish and enforce rules to minimize conflicts of interest

in the decisionmaking process of the contract market and establish a process for resolving such conflicts of interest.

‘‘(16) COMPOSITION OF BOARDS OF MUTUALLY OWNED CONTRACT MARKETS.—In the case of a mutually owned contract

market, the board of trade shall ensure that the composition

of the governing board reflects market participants.

‘‘(17) RECORDKEEPING.—The board of trade shall maintain

records of all activities related to the business of the contract

market in a form and manner acceptable to the Commission

for a period of 5 years.

‘‘(18) ANTITRUST CONSIDERATIONS.—Unless necessary or

appropriate to achieve the purposes of this Act, the board

of trade shall endeavor to avoid—

‘‘(A) adopting any rules or taking any actions that

result in any unreasonable restraints of trade; or

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–387

‘‘(B) imposing any material anticompetitive burden on

trading on the contract market. ‘‘(e) CURRENT AGRICULTURAL COMMODITIES.— ‘‘(1) Subject to paragraph (2) of this subsection, a contract

for purchase or sale for future delivery of an agricultural

commodity enumerated in section 1a(4) that is available for

trade on a contract market, as of the date of the enactment

of this subsection, may be traded only on a contract market

designated under this section. ‘‘(2) In order to promote responsible economic or financial

innovation and fair competition, the Commission, on application

by any person, after notice and public comment and opportunity

for hearing, may prescribe rules and regulations to provide

for the offer and sale of contracts for future delivery or options

on such contracts to be conducted on a derivatives transaction

execution facility.’’.

SEC. 111. DERIVATIVES TRANSACTION EXECUTION FACILITIES.

The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended

by inserting after section 5 (as amended by section 110(2)) the

following:

‘‘SEC. 5a. DERIVATIVES TRANSACTION EXECUTION FACILITIES.

‘‘(a) IN GENERAL.—In lieu of compliance with the contract market designation requirements of sections 4(a) and 5, a board of

trade may elect to operate as a registered derivatives transaction

execution facility if the facility is— ‘‘(1) designated as a contract market and meets the requirements of this section; or ‘‘(2) registered as a derivatives transaction execution facility under subsection (c) of this section.

‘‘(b) REQUIREMENTS FOR TRADING.— ‘‘(1) IN GENERAL.—A registered derivatives transaction

execution facility under subsection (a) may trade any contract

of sale of a commodity for future delivery (or option on such

a contract) on or through the facility only by satisfying the

requirements of this section. ‘‘(2) REQUIREMENTS FOR UNDERLYING COMMODITIES.—A registered derivatives transaction execution facility may trade any

contract of sale of a commodity for future delivery (or option

on such a contract) only if— ‘‘(A) the underlying commodity has a nearly inexhaustible deliverable supply; ‘‘(B) the underlying commodity has a deliverable supply

that is sufficiently large that the contract is highly unlikely

to be susceptible to the threat of manipulation; ‘‘(C) the underlying commodity has no cash market;

‘‘(D)(i) the contract is a security futures product, and

(ii) the registered derivatives transaction execution facility

is a national securities exchange registered under the Securities Exchange Act of 1934;

‘‘(E) the Commission determines, based on the market

characteristics, surveillance history, self-regulatory record,

and capacity of the facility that trading in the contract

(or option) is highly unlikely to be susceptible to the threat

of manipulation; or

‘‘(F) except as provided in section 5(e)(2), the underlying commodity is a commodity other than an agricultural

114 STAT. 2763A–388 PUBLIC LAW 106–554—APPENDIX E

commodity enumerated in section 1a(4), and trading access

to the facility is limited to eligible commercial entities

trading for their own account.

‘‘(3) ELIGIBLE TRADERS.—To trade on a registered derivatives transaction execution facility, a person shall— ‘‘(A) be an eligible contract participant; or

‘‘(B) be a person trading through a futures commission

merchant that— ‘‘(i) is registered with the Commission;

‘‘(ii) is a member of a futures self-regulatory

organization or, if the person trades only security

futures products on the facility, a national securities

association registered under section 15A(a) of the Securities Exchange Act of 1934; ‘‘(iii) is a clearing member of a derivatives clearing

organization; and ‘‘(iv) has net capital of at least $20,000,000. ‘‘(4) TRADING BY CONTRACT MARKETS.—A board of trade

that is designated as a contract market shall, to the extent

that the contract market also operates a registered derivatives

transaction execution facility—

‘‘(A) provide a physical location for the contract market

trading of the board of trade that is separate from trading

on the derivatives transaction execution facility of the board

of trade; or

‘‘(B) if the board of trade uses the same electronic

trading system for trading on the contract market and

derivatives transaction execution facility of the board of

trade, identify whether the electronic trading is taking

place on the contract market or the derivatives transaction

execution facility.

‘‘(c) CRITERIA FOR REGISTRATION.—

‘‘(1) IN GENERAL.—To be registered as a registered derivatives transaction execution facility, the board of trade shall

be required to demonstrate to the Commission only that the

board of trade meets the criteria specified in subsection (b)

and this subsection.

‘‘(2) DETERRENCE OF ABUSES.—The board of trade shall

establish and enforce trading and participation rules that will

deter abuses and has the capacity to detect, investigate, and

enforce those rules, including means to—

‘‘(A) obtain information necessary to perform the functions required under this section; or

‘‘(B) use technological means to—

‘‘(i) provide market participants with impartial

access to the market; and

‘‘(ii) capture information that may be used in

establishing whether rule violations have occurred.

‘‘(3) TRADING PROCEDURES.—The board of trade shall establish and enforce rules or terms and conditions defining, or

specifications detailing, trading procedures to be used in entering and executing orders traded on the facilities of the board

of trade. The rules may authorize—

‘‘(A) transfer trades or office trades;

‘‘(B) an exchange of—

‘‘(i) futures in connection with a cash commodity

transaction;

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–389

‘‘(ii) futures for cash commodities; or

‘‘(iii) futures for swaps; or ‘‘(C) a futures commission merchant, acting as principal

or agent, to enter into or confirm the execution of a contract

for the purchase or sale of a commodity for future delivery

if the contract is reported, recorded, or cleared in accordance with the rules of the registered derivatives transaction

execution facility or a derivatives clearing organization.

‘‘(4) FINANCIAL INTEGRITY OF TRANSACTIONS.—The board

of trade shall establish and enforce rules or terms and conditions providing for the financial integrity of transactions

entered on or through the facilities of the board of trade,

and rules or terms and conditions to ensure the financial integrity of any futures commission merchants and introducing brokers and the protection of customer funds.

‘‘(d) CORE PRINCIPLES FOR REGISTERED DERIVATIVES TRANSACTION EXECUTION FACILITIES.—

‘‘(1) IN GENERAL.—To maintain the registration of a board

of trade as a derivatives transaction execution facility, a board

of trade shall comply with the core principles specified in this

subsection. The board of trade shall have reasonable discretion

in establishing the manner in which the board of trade complies

with the core principles.

‘‘(2) COMPLIANCE WITH RULES.—The board of trade shall

monitor and enforce the rules of the facility, including any

terms and conditions of any contracts traded on or through

the facility and any limitations on access to the facility.

‘‘(3) MONITORING OF TRADING.—The board of trade shall

monitor trading in the contracts of the facility to ensure orderly

trading in the contract and to maintain an orderly market

while providing any necessary trading information to the

Commission to allow the Commission to discharge the responsibilities of the Commission under the Act.

‘‘(4) DISCLOSURE OF GENERAL INFORMATION.—The board of

trade shall disclose publicly and to the Commission information

concerning—

‘‘(A) contract terms and conditions;

‘‘(B) trading conventions, mechanisms, and practices;

‘‘(C) financial integrity protections; and

‘‘(D) other information relevant to participation in trading on the facility.

‘‘(5) DAILY PUBLICATION OF TRADING INFORMATION.—The

board of trade shall make public daily information on settlement prices, volume, open interest, and opening and closing

ranges for contracts traded on the facility if the Commission

determines that the contracts perform a significant price discovery function for transactions in the cash market for the

commodity underlying the contracts.

‘‘(6) FITNESS STANDARDS.—The board of trade shall establish and enforce appropriate fitness standards for directors,

members of any disciplinary committee, members, and any

other persons with direct access to the facility, including any

parties affiliated with any of the persons described in this

paragraph.

‘‘(7) CONFLICTS OF INTEREST.—The board of trade shall

establish and enforce rules to minimize conflicts of interest

in the decision making process of the derivatives transaction

114 STAT. 2763A–390 PUBLIC LAW 106–554—APPENDIX E

execution facility and establish a process for resolving such

conflicts of interest.

‘‘(8) RECORDKEEPING.—The board of trade shall maintain

records of all activities related to the business of the derivatives

transaction execution facility in a form and manner acceptable

to the Commission for a period of 5 years.

‘‘(9) ANTITRUST CONSIDERATIONS.—Unless necessary or

appropriate to achieve the purposes of this Act, the board

of trade shall endeavor to avoid—

‘‘(A) adopting any rules or taking any actions that

result in any unreasonable restraint of trade; or

‘‘(B) imposing any material anticompetitive burden on

trading on the derivatives transaction execution facility.

‘‘(e) USE OF BROKER-DEALERS, DEPOSITORY INSTITUTIONS, AND

FARM CREDIT SYSTEM INSTITUTIONS AS INTERMEDIARIES.—

‘‘(1) IN GENERAL.—With respect to transactions other than

transactions in security futures products, a registered derivatives transaction execution facility may by rule allow a brokerdealer, depository institution, or institution of the Farm Credit

System that meets the requirements of paragraph (2) to—

‘‘(A) act as an intermediary in transactions executed

on the facility on behalf of customers of the broker-dealer,

depository institution, or institution of the Farm Credit

System; and

‘‘(B) receive funds of customers to serve as margin

or security for the transactions.

‘‘(2) REQUIREMENTS.—The requirements referred to in paragraph (1) are that—

‘‘(A) the broker-dealer be in good standing with the

Securities and Exchange Commission, or the depository

institution or institution of the Farm Credit System be

in good standing with Federal bank regulatory agencies

(including the Farm Credit Administration), as applicable;

and

‘‘(B) if the broker-dealer, depository institution, or

institution of the Farm Credit System carries or holds

customer accounts or funds for transactions on the derivatives transaction execution facility for more than 1 business

day, the broker-dealer, depository institution, or institution

of the Farm Credit System is registered as a futures

commission merchant and is a member of a registered

futures association.

‘‘(3) IMPLEMENTATION.—The Commission shall cooperate

and coordinate with the Securities and Exchange Commission,

the Secretary of the Treasury, and Federal banking regulatory

agencies (including the Farm Credit Administration) in adopting rules and taking any other appropriate action to facilitate

the implementation of this subsection.

‘‘(f ) SEGREGATION OF CUSTOMER FUNDS.—Not later than 180

days after the date of the enactment of the Commodity Futures

Modernization Act of 2000, consistent with regulations adopted

by the Commission, a registered derivatives transaction execution

facility may authorize a futures commission merchant to offer any

customer of the futures commission merchant that is an eligible

contract participant the right to not segregate the customer funds

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–391

of the customer that are carried with the futures commission merchant for purposes of trading on or through the facilities of the

registered derivatives transaction execution facility. ‘‘(g) ELECTION TO TRADE EXCLUDED AND EXEMPT COMMOD- ITIES.— ‘‘(1) IN GENERAL.—Notwithstanding subsection (b)(2) of this

section, a board of trade that is or elects to become a registered

derivatives transaction execution facility may trade on the facility any agreements, contracts, or transactions involving

excluded or exempt commodities other than securities, except

contracts of sale for future delivery of exempt securities under

section 3(a)(12) of the Securities Exchange Act of 1934 as

in effect on the date of the enactment of the Futures Trading

Act of 1982, that are otherwise excluded from this Act under

section 2(c), 2(d), or 2(g) of this Act, or exempt under section

2(h) of this Act. ‘‘(2) EXCLUSIVE JURISDICTION OF THE COMMISSION.—The

Commission shall have exclusive jurisdiction over agreements,

contracts, or transactions described in paragraph (1) to the

extent that the agreements, contracts, or transactions are

traded on a derivatives transaction execution facility.’’.

SEC. 112. DERIVATIVES CLEARING.

(a) IN GENERAL.—Subtitle A of title IV of the Federal Deposit

Insurance Corporation Improvement Act of 1991 is amended— (1) by inserting before the section heading for section 401,

the following new heading:

‘‘CHAPTER 1—BILATERAL AND CLEARING

ORGANIZATION NETTING’’;

(2) in section 402, by striking ‘‘this subtitle’’ and inserting ‘‘this chapter’’; and

(3) by inserting after section 407, the following new chapter:

‘‘CHAPTER 2—MULTILATERAL CLEARING

ORGANIZATIONS

‘‘SEC. 408. DEFINITIONS.

For purposes of this chapter, the following definitions shall

apply: ‘‘(1) MULTILATERAL CLEARING ORGANIZATION.—The term ‘multilateral clearing organization’ means a system utilized

by more than two participants in which the bilateral credit

exposures of participants arising from the transactions cleared

are effectively eliminated and replaced by a system of guarantees, insurance, or mutualized risk of loss. ‘‘(2) OVER-THE-COUNTER DERIVATIVE INSTRUMENT.—The

term ‘over-the-counter derivative instrument’ includes— ‘‘(A) any agreement, contract, or transaction, including

the terms and conditions incorporated by reference in any

such agreement, contract, or transaction, which is an

interest rate swap, option, or forward agreement, including

a rate floor, rate cap, rate collar, cross-currency rate swap,

basis swap, and forward rate agreement; a same day-tomorrow, tomorrow-next, forward, or other foreign exchange

or precious metals agreement; a currency swap, option,

or forward agreement; an equity index or equity swap,

114 STAT. 2763A–392 PUBLIC LAW 106–554—APPENDIX E

option, or forward agreement; a debt index or debt swap,

option, or forward agreement; a credit spread or credit

swap, option, or forward agreement; a commodity index

or commodity swap, option, or forward agreement; and

a weather swap, weather derivative, or weather option; ‘‘(B) any agreement, contract or transaction similar

to any other agreement, contract, or transaction referred

to in this clause that is presently, or in the future becomes,

regularly entered into by parties that participate in swap

transactions (including terms and conditions incorporated

by reference in the agreement) and that is a forward,

swap, or option on one or more occurrences of any event,

rates, currencies, commodities, equity securities or other

equity instruments, debt securities or other debt

instruments, economic or other indices or measures of economic or other risk or value; ‘‘(C) any agreement, contract, or transaction excluded

from the Commodity Exchange Act under section 2(c), 2(d),

2(f ), or 2(g) of such Act, or exempted under section 2(h)

or 4(c) of such Act; and ‘‘(D) any option to enter into any, or any combination

of, agreements, contracts or transactions referred to in

this subparagraph.

‘‘(3) OTHER DEFINITIONS.—The terms ‘insured State nonmember bank’, ‘State member bank’, and ‘affiliate’ have the

same meanings as in section 3 of the Federal Deposit Insurance

Act.

‘‘SEC. 409. MULTILATERAL CLEARING ORGANIZATIONS.

‘‘(a) IN GENERAL.—Except with respect to clearing organizations

described in subsection (b), no person may operate a multilateral

clearing organization for over-the-counter derivative instruments,

or otherwise engage in activities that constitute such a multilateral

clearing organization unless the person is a national bank, a State

member bank, an insured State nonmember bank, an affiliate of

a national bank, a State member bank, or an insured State nonmember bank, or a corporation chartered under section 25A of

the Federal Reserve Act. ‘‘(b) CLEARING ORGANIZATIONS.—Subsection (a) shall not apply

to any clearing organization that— ‘‘(1) is registered as a clearing agency under the Securities

Exchange Act of 1934; ‘‘(2) is registered as a derivatives clearing organization

under the Commodity Exchange Act; or ‘‘(3) is supervised by a foreign financial regulator that

the Comptroller of the Currency, the Board of Governors of

the Federal Reserve System, the Federal Deposit Insurance

Corporation, the Securities and Exchange Commission, or the

Commodity Futures Trading Commission, as applicable, has

determined satisfies appropriate standards.’’.

(b) RESOLUTION OF CLEARING BANKS.—The Federal Reserve

Act (12 U.S.C. 221 et seq.) is amended by inserting after section

9A the following new section:

‘‘SEC. 9B. RESOLUTION OF CLEARING BANKS.

‘‘(a) CONSERVATORSHIP OR RECEIVERSHIP.—

‘‘(1) APPOINTMENT.—The Board may appoint a conservator

or receiver to take possession and control of any uninsured

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–393

State member bank which operates, or operates as, a multilateral clearing organization pursuant to section 409 of the Federal

Deposit Insurance Corporation Improvement Act of 1991 to

the same extent and in the same manner as the Comptroller

of the Currency may appoint a conservator or receiver for

a national bank.

‘‘(2) POWERS.—The conservator or receiver for an uninsured

State member bank referred to in paragraph (1) shall exercise

the same powers, functions, and duties, subject to the same

limitations, as a conservator or receiver for a national bank.

‘‘(b) BOARD AUTHORITY.—The Board shall have the same

authority with respect to any conservator or receiver appointed

under subsection (a), and the uninsured State member bank for

which the conservator or receiver has been appointed, as the

Comptroller of the Currency has with respect to a conservator

or receiver for a national bank and the national bank for which

the conservator or receiver has been appointed.

‘‘(c) BANKRUPTCY PROCEEDINGS.—The Board (in the case of

an uninsured State member bank which operates, or operates as,

such a multilateral clearing organization) may direct a conservator

or receiver appointed for the bank to file a petition pursuant to

title 11, United States Code, in which case, title 11, United States

Code, shall apply to the bank in lieu of otherwise applicable Federal

or State insolvency law.’’.

(c) TECHNICAL AND CONFORMING AMENDMENTS TO TITLE 11,

UNITED STATES CODE.—

(1) BANKRUPTCY CODE DEBTORS.—Section 109(b)(2) of title

11, United States Code, is amended by striking ‘‘; or’’ and

inserting the following: ‘‘, except that an uninsured State member bank, or a corporation organized under section 25A of

the Federal Reserve Act, which operates, or operates as, a

multilateral clearing organization pursuant to section 409 of

the Federal Deposit Insurance Corporation Improvement Act

of 1991 may be a debtor if a petition is filed at the direction

of the Board of Governors of the Federal Reserve System;

or’’.

(2) CHAPTER 7 DEBTORS.—Section 109(d) of title 11, United

States Code, is amended to read as follows:

‘‘(d) Only a railroad, a person that may be a debtor under

chapter 7 of this title (except a stockbroker or a commodity broker),

and an uninsured State member bank, or a corporation organized

under section 25A of the Federal Reserve Act, which operates,

or operates as, a multilateral clearing organization pursuant to

section 409 of the Federal Deposit Insurance Corporation Improvement Act of 1991 may be a debtor under chapter 11 of this title.’’.

(3) DEFINITION OF FINANCIAL INSTITUTION.—Section 101(22)

of title 11, United States Code, is amended to read as follows:

‘‘(22) the term ‘financial institution’—

‘‘(A) means—

‘‘(i) a Federal reserve bank or an entity (domestic

or foreign) that is a commercial or savings bank, industrial savings bank, savings and loan association, trust

company, or receiver or conservator for such entity

and, when any such Federal reserve bank, receiver,

conservator, or entity is acting as agent or custodian

for a customer in connection with a securities contract,

114 STAT. 2763A–394 PUBLIC LAW 106–554—APPENDIX E

as defined in section 741 of this title, the customer;

or ‘‘(ii) in connection with a securities contract, as

defined in section 741 of this title, an investment company registered under the Investment Company Act

of 1940; and

‘‘(B) includes any person described in subparagraph

(A) which operates, or operates as, a multilateral clearing

organization pursuant to section 409 of the Federal Deposit

Insurance Corporation Improvement Act of 1991;’’.

(4) DEFINITION OF UNINSURED STATE MEMBER BANK.—Section 101 of title 11, United States Code, is amended by inserting

after paragraph (54) the following new paragraph— ‘‘(54A) the term ‘uninsured State member bank’ means a State

member bank (as defined in section 3 of the Federal Deposit Insurance Act) the deposits of which are not insured by the Federal

Deposit Insurance Corporation; and’’. (5) SUBCHAPTER V OF CHAPTER 7.—

(A) IN GENERAL.—Section 103 of title 11, United States

Code, is amended—

(i) by redesignating subsections (e) through (i) as

subsections (f ) through ( j), respectively; and

(ii) by inserting after subsection (d) the following

new subsection:

‘‘(e) SCOPE OF APPLICATION.—Subchapter V of chapter 7 of

this title shall apply only in a case under such chapter concerning

the liquidation of an uninsured State member bank, or a corporation

organized under section 25A of the Federal Reserve Act, which

operates, or operates as, a multilateral clearing organization pursuant to section 409 of the Federal Deposit Insurance Corporation

Improvement Act of 1991.’’.

(B) CLEARING BANK LIQUIDATION.—Chapter 7 of title

11, United States Code, is amended by adding at the end

the following new subchapter:

‘‘SUBCHAPTER V—CLEARING BANK LIQUIDATION

‘‘§ 781. Definitions

‘‘For purposes of this subchapter, the following definitions shall

apply:

‘‘(1) BOARD.—The term ‘Board’ means the Board of Governors of the Federal Reserve System.

‘‘(2) DEPOSITORY INSTITUTION.—The term ‘depository

institution’ has the same meaning as in section 3 of the Federal

Deposit Insurance Act.

‘‘(3) CLEARING BANK.—The term ‘clearing bank’ means an

uninsured State member bank, or a corporation organized

under section 25A of the Federal Reserve Act, which operates,

or operates as, a multilateral clearing organization pursuant

to section 409 of the Federal Deposit Insurance Corporation

Improvement Act of 1991.

‘‘§ 782. Selection of trustee

‘‘(a) IN GENERAL.— ‘‘(1) APPOINTMENT.—Notwithstanding any other provision

of this title, the conservator or receiver who files the petition

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–395

shall be the trustee under this chapter, unless the Board designates an alternative trustee.

‘‘(2) SUCCESSOR.—The Board may designate a successor

trustee if required.

‘‘(b) AUTHORITY OF TRUSTEE.—Whenever the Board appoints

or designates a trustee, chapter 3 and sections 704 and 705 of

this title shall apply to the Board in the same way and to the

same extent that they apply to a United States trustee.

‘‘§ 783. Additional powers of trustee

‘‘(a) DISTRIBUTION OF PROPERTY NOT OF THE ESTATE.—The

trustee under this subchapter has power to distribute property

not of the estate, including distributions to customers that are

mandated by subchapters III and IV of this chapter.

‘‘(b) DISPOSITION OF INSTITUTION.—The trustee under this subchapter may, after notice and a hearing—

‘‘(1) sell the clearing bank to a depository institution or

consortium of depository institutions (which consortium may

agree on the allocation of the clearing bank among the consortium);

‘‘(2) merge the clearing bank with a depository institution;

‘‘(3) transfer contracts to the same extent as could a receiver

for a depository institution under paragraphs (9) and (10) of

section 11(e) of the Federal Deposit Insurance Act;

‘‘(4) transfer assets or liabilities to a depository institution;

and

‘‘(5) transfer assets and liabilities to a bridge bank as

provided in paragraphs (1), (3)(A), (5), and (6) of section 11(n)

of the Federal Deposit Insurance Act, paragraphs (9) through

(13) of such section, and subparagraphs (A) through (H) and

subparagraph (K) of paragraph (4) of such section 11(n), except

that—

‘‘(A) the bridge bank to which such assets or liabilities

are transferred shall be treated as a clearing bank for

the purpose of this subsection; and

‘‘(B) any references in any such provision of law to

the Federal Deposit Insurance Corporation shall be construed to be references to the appointing agency and that

references to deposit insurance shall be omitted.

‘‘(c) CERTAIN TRANSFERS INCLUDED.—Any reference in this section to transfers of liabilities includes a ratable transfer of liabilities

within a priority class.

‘‘§ 784. Right to be heard

‘‘The Board or a Federal reserve bank (in the case of a clearing

bank that is a member of that bank) may raise and may appear

and be heard on any issue in a case under this subchapter.’’.

(6) DEFINITIONS OF CLEARING ORGANIZATION, CONTRACT

MARKET, AND RELATED DEFINITIONS.—

(A) Section 761(2) of title 11, United States Code, is

amended to read as follows:

‘‘(2) ‘clearing organization’ means a derivatives clearing

organization registered under the Act;’’.

(B) Section 761(7) of title 11, United States Code, is

amended to read as follows:

‘‘(7) ‘contract market’ means a registered entity;’’.

114 STAT. 2763A–396 PUBLIC LAW 106–554—APPENDIX E

(C) Section 761(8) of title 11, United States Code, is

amended to read as follows:

‘‘(8) ‘contract of sale’, ‘commodity’, ‘derivatives clearing

organization’, ‘future delivery’, ‘board of trade’, ‘registered

entity’, and ‘futures commission merchant’ have the meanings

assigned to those terms in the Act;’’.

(d) CLERICAL AMENDMENT.—The table of sections for chapter

7 of title 11, United States Code, is amended by adding at the

end the following new items:

‘‘SUBCHAPTER V—CLEARING BANK LIQUIDATION

‘‘Sec.

‘‘781. Definitions.

‘‘782. Selection of trustee.

‘‘783. Additional powers of trustee.

‘‘784. Right to be heard.’’.

(e) RESOLUTION OF EDGE ACT CORPORATIONS.—The 16th

undesignated paragraph of section 25A of the Federal Reserve

Act (12 U.S.C. 624) is amended to read as follows:

‘‘(16) APPOINTMENT OF RECEIVER OR CONSERVATOR.—

‘‘(A) IN GENERAL.—The Board may appoint a conservator or receiver for a corporation organized under the provisions of this section to the same extent and in the same

manner as the Comptroller of the Currency may appoint

a conservator or receiver for a national bank, and the

conservator or receiver for such corporation shall exercise

the same powers, functions, and duties, subject to the same

limitations, as a conservator or receiver for a national

bank.

‘‘(B) EQUIVALENT AUTHORITY.—The Board shall have

the same authority with respect to any conservator or

receiver appointed for a corporation organized under the

provisions of this section under this paragraph and any

such corporation as the Comptroller of the Currency has

with respect to a conservator or receiver of a national

bank and the national bank for which a conservator or

receiver has been appointed.

‘‘(C) TITLE 11 PETITIONS.—The Board may direct the

conservator or receiver of a corporation organized under

the provisions of this section to file a petition pursuant

to title 11, United States Code, in which case, title 11,

United States Code, shall apply to the corporation in lieu

of otherwise applicable Federal or State insolvency law.’’.

(f ) DERIVATIVES CLEARING ORGANIZATIONS.—The Commodity

Exchange Act (7 U.S.C. 1 et seq.) is amended by inserting after

section 5a, as added by section 111 of this Act, the following:

‘‘SEC. 5b. DERIVATIVES CLEARING ORGANIZATIONS.

‘‘(a) REGISTRATION REQUIREMENT.—It shall be unlawful for a

derivatives clearing organization, unless registered with the

Commission, directly or indirectly to make use of the mails or

any means or instrumentality of interstate commerce to perform

the functions of a derivatives clearing organization described in

section 1a(9) of this Act with respect to a contract of sale of a

commodity for future delivery (or option on such a contract) or

option on a commodity, in each case unless the contract or option—

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–397

‘‘(1) is excluded from this Act by section 2(a)(1)(C)(i), 2(c),

2(d), 2(f ), or 2(g) of this Act or title IV of the Commodity

Futures Modernization Act of 2000, or exempted under section

2(h) or 4(c) of this Act; or

‘‘(2) is a security futures product cleared by a clearing

agency registered under the Securities Exchange Act of 1934.

‘‘(b) VOLUNTARY REGISTRATION.—A derivatives clearing

organization that clears agreements, contracts, or transactions

excluded from this Act by section 2(c), 2(d), 2(f ), or 2(g) of this

Act or title IV of the Commodity Futures Modernization Act of

2000, or exempted under section 2(h) or 4(c) of this Act, or other

over-the-counter derivative instruments (as defined in the Federal

Deposit Insurance Corporation Improvement Act of 1991) may register with the Commission as a derivatives clearing organization.

‘‘(c) REGISTRATION OF DERIVATIVES CLEARING ORGANIZATIONS.—

‘‘(1) APPLICATION.—A person desiring to register as a

derivatives clearing organization shall submit to the Commission an application in such form and containing such information as the Commission may require for the purpose of making

the determinations required for approval under paragraph (2).

‘‘(2) CORE PRINCIPLES.—

‘‘(A) IN GENERAL.—To be registered and to maintain

registration as a derivatives clearing organization, an

applicant shall demonstrate to the Commission that the

applicant complies with the core principles specified in

this paragraph. The applicant shall have reasonable discretion in establishing the manner in which it complies with

the core principles.

‘‘(B) FINANCIAL RESOURCES.—The applicant shall demonstrate that the applicant has adequate financial, operational, and managerial resources to discharge the responsibilities of a derivatives clearing organization.

‘‘(C) PARTICIPANT AND PRODUCT ELIGIBILITY.—The

applicant shall establish—

‘‘(i) appropriate admission and continuing eligibility standards (including appropriate minimum financial requirements) for members of and participants

in the organization; and

‘‘(ii) appropriate standards for determining eligibility of agreements, contracts, or transactions submitted to the applicant.

‘‘(D) RISK MANAGEMENT.—The applicant shall have the

ability to manage the risks associated with discharging

the responsibilities of a derivatives clearing organization

through the use of appropriate tools and procedures.

‘‘(E) SETTLEMENT PROCEDURES.—The applicant shall

have the ability to—

‘‘(i) complete settlements on a timely basis under

varying circumstances;

‘‘(ii) maintain an adequate record of the flow of

funds associated with each transaction that the

applicant clears; and

‘‘(iii) comply with the terms and conditions of any

permitted netting or offset arrangements with other

clearing organizations.

114 STAT. 2763A–398 PUBLIC LAW 106–554—APPENDIX E

‘‘(F) TREATMENT OF FUNDS.—The applicant shall have

standards and procedures designed to protect and ensure

the safety of member and participant funds. ‘‘(G) DEFAULT RULES AND PROCEDURES.—The applicant

shall have rules and procedures designed to allow for efficient, fair, and safe management of events when members

or participants become insolvent or otherwise default on

their obligations to the derivatives clearing organization. ‘‘(H) RULE ENFORCEMENT.—The applicant shall— ‘‘(i) maintain adequate arrangements and

resources for the effective monitoring and enforcement

of compliance with rules of the applicant and for resolution of disputes; and ‘‘(ii) have the authority and ability to discipline,

limit, suspend, or terminate a member’s or participant’s activities for violations of rules of the applicant. ‘‘(I) SYSTEM SAFEGUARDS.—The applicant shall demonstrate that the applicant—

‘‘(i) has established and will maintain a program

of oversight and risk analysis to ensure that the automated systems of the applicant function properly and

have adequate capacity and security; and

‘‘(ii) has established and will maintain emergency

procedures and a plan for disaster recovery, and will

periodically test backup facilities sufficient to ensure

daily processing, clearing, and settlement of transactions.

‘‘(J) REPORTING.—The applicant shall provide to the

Commission all information necessary for the Commission

to conduct the oversight function of the applicant with

respect to the activities of the derivatives clearing organization.

‘‘(K) RECORDKEEPING.—The applicant shall maintain

records of all activities related to the business of the

applicant as a derivatives clearing organization in a form

and manner acceptable to the Commission for a period

of 5 years.

‘‘(L) PUBLIC INFORMATION.—The applicant shall make

information concerning the rules and operating procedures

governing the clearing and settlement systems (including

default procedures) available to market participants.

‘‘(M) INFORMATION-SHARING.—The applicant shall—

‘‘(i) enter into and abide by the terms of all appropriate and applicable domestic and international

information-sharing agreements; and

‘‘(ii) use relevant information obtained from the

agreements in carrying out the clearing organization’s

risk management program.

‘‘(N) ANTITRUST CONSIDERATIONS.—Unless appropriate

to achieve the purposes of this Act, the derivatives clearing

organization shall avoid— ‘‘(i) adopting any rule or taking any action that

results in any unreasonable restraint of trade; or

‘‘(ii) imposing any material anticompetitive burden

on trading on the contract market.

‘‘(3) ORDERS CONCERNING COMPETITION.—A derivatives

clearing organization may request the Commission to issue

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–399

an order concerning whether a rule or practice of the applicant

is the least anticompetitive means of achieving the objectives,

purposes, and policies of this Act.

‘‘(d) EXISTING DERIVATIVES CLEARING ORGANIZATIONS.—A

derivatives clearing organization shall be deemed to be registered

under this section to the extent that the derivatives clearing

organization clears agreements, contracts, or transactions for a

board of trade that has been designated by the Commission as

a contract market for such agreements, contracts, or transactions

before the date of the enactment of this section. ‘‘(e) APPOINTMENT OF TRUSTEE.— ‘‘(1) IN GENERAL.—If a proceeding under section 5e results

in the suspension or revocation of the registration of a derivatives clearing organization, or if a derivatives clearing organization withdraws from registration, the Commission, on notice

to the derivatives clearing organization, may apply to the appropriate United States district court where the derivatives clearing organization is located for the appointment of a trustee. ‘‘(2) ASSUMPTION OF JURISDICTION.—If the Commission

applies for appointment of a trustee under paragraph (1)— ‘‘(A) the court may take exclusive jurisdiction over

the derivatives clearing organization and the records and

assets of the derivatives clearing organization, wherever

located; and ‘‘(B) if the court takes jurisdiction under subparagraph

(A), the court shall appoint the Commission, or a person

designated by the Commission, as trustee with power to

take possession and continue to operate or terminate the

operations of the derivatives clearing organization in an

orderly manner for the protection of participants, subject

to such terms and conditions as the court may prescribe. ‘‘(f ) LINKING OF REGULATED CLEARING FACILITIES.— ‘‘(1) IN GENERAL.—The Commission shall facilitate the linking or coordination of derivatives clearing organizations registered under this Act with other regulated clearance facilities

for the coordinated settlement of cleared transactions. ‘‘(2) COORDINATION.—In carrying out paragraph (1), the

Commission shall coordinate with the Federal banking agencies

and the Securities and Exchange Commission.’’.

SEC. 113. COMMON PROVISIONS APPLICABLE TO REGISTERED ENTITIES.

The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended

by inserting after section 5b (as added by section 112(f )) the following:

‘‘SEC. 5c. COMMON PROVISIONS APPLICABLE TO REGISTERED ENTITIES.

‘‘(a) ACCEPTABLE BUSINESS PRACTICES UNDER CORE PRINCIPLES.—

‘‘(1) IN GENERAL.—Consistent with the purposes of this

Act, the Commission may issue interpretations, or approve

interpretations submitted to the Commission, of sections 5(d),

5a(d), and 5b(d)(2) to describe what would constitute an acceptable business practice under such sections.

‘‘(2) EFFECT OF INTERPRETATION.—An interpretation issued

under paragraph (1) shall not provide the exclusive means

for complying with such sections.

114 STAT. 2763A–400 PUBLIC LAW 106–554—APPENDIX E

‘‘(b) DELEGATION OF FUNCTIONS UNDER CORE PRINCIPLES.— ‘‘(1) IN GENERAL.—A contract market or derivatives transaction execution facility may comply with any applicable core

principle through delegation of any relevant function to a registered futures association or another registered entity.

‘‘(2) RESPONSIBILITY.—A contract market or derivatives

transaction execution facility that delegates a function under

paragraph (1) shall remain responsible for carrying out the

function. ‘‘(3) NONCOMPLIANCE.—If a contract market or derivatives

transaction execution facility that delegates a function under

paragraph (1) becomes aware that a delegated function is not

being performed as required under this Act, the contract market

or derivatives transaction execution facility shall promptly take

steps to address the noncompliance.

‘‘(c) NEW CONTRACTS, NEW RULES, AND RULE AMENDMENTS.— ‘‘(1) IN GENERAL.—Subject to paragraph (2), a registered

entity may elect to list for trading or accept for clearing any

new contract or other instrument, or may elect to approve

and implement any new rule or rule amendment, by providing

to the Commission (and the Secretary of the Treasury, in the

case of a contract of sale of a government security for future

delivery (or option on such a contract) or a rule or rule amendment specifically related to such a contract) a written certification that the new contract or instrument or clearing of the

new contract or instrument, new rule, or rule amendment complies with this Act (including regulations under this Act).

‘‘(2) PRIOR APPROVAL.—

‘‘(A) IN GENERAL.—A registered entity may request that

the Commission grant prior approval to any new contract

or other instrument, new rule, or rule amendment.

‘‘(B) PRIOR APPROVAL REQUIRED.—Notwithstanding any

other provision of this section, a designated contract market

shall submit to the Commission for prior approval each

rule amendment that materially changes the terms and

conditions, as determined by the Commission, in any contract of sale for future delivery of a commodity specifically

enumerated in section 1a(4) (or any option thereon) traded

through its facilities if the rule amendment applies to

contracts and delivery months which have already been

listed for trading and have open interest.

‘‘(C) DEADLINE.—If prior approval is requested under

subparagraph (A), the Commission shall take final action

on the request not later than 90 days after submission

of the request, unless the person submitting the request

agrees to an extension of the time limitation established

under this subparagraph.

‘‘(3) APPROVAL.—The Commission shall approve any such

new contract or instrument, new rule, or rule amendment

unless the Commission finds that the new contract or

instrument, new rule, or rule amendment would violate this

Act.

‘‘(d) VIOLATION OF CORE PRINCIPLES.—

‘‘(1) IN GENERAL.—If the Commission determines, on the

basis of substantial evidence, that a registered entity is violating any applicable core principle specified in section 5(d), 5a(d),

or 5b(d)(2), the Commission shall—

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–401

‘‘(A) notify the registered entity in writing of the determination; and ‘‘(B) afford the registered entity an opportunity to make

appropriate changes to bring the registered entity into

compliance with the core principles.

‘‘(2) FAILURE TO MAKE CHANGES.—If, not later than 30

days after receiving a notification under paragraph (1), a registered entity fails to make changes that, in the opinion of

the Commission, are necessary to comply with the core principles, the Commission may take further action in accordance

with this Act.

‘‘(e) RESERVATION OF EMERGENCY AUTHORITY.—Nothing in this

section shall limit or in any way affect the emergency powers

of the Commission provided in section 8a(9).’’.

SEC. 114. EXEMPT BOARDS OF TRADE.

The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended

by inserting after section 5c (as added by section 113) the following:

‘‘SEC. 5d. EXEMPT BOARDS OF TRADE.

‘‘(a) ELECTION TO REGISTER WITH THE COMMISSION.—A board

of trade that meets the requirements of subsection (b) of this

section may operate as an exempt board of trade on receipt from

the board of trade of a notice, provided in such manner as the

Commission may by rule or regulation prescribe, that the board

of trade elects to operate as an exempt board of trade. Except

as otherwise provided in this section, no provision of this Act

(other than subparagraphs (C) and (D) of sections 2(a)(1) and

12(e)(2)(B)) shall apply with respect to a contract of sale of a

commodity for future delivery (or option on such a contract) traded

on or through the facilities of an exempt board of trade.

‘‘(b) CRITERIA FOR EXEMPTION.—To qualify for an exemption

under subsection (a), a board of trade shall limit trading on or

through the facilities of the board of trade to contracts of sale

of a commodity for future delivery (or options on such contracts

or on a commodity)—

‘‘(1) for which the underlying commodity has—

‘‘(A) a nearly inexhaustible deliverable supply;

‘‘(B) a deliverable supply that is sufficiently large, and

a cash market sufficiently liquid, to render any contract

traded on the commodity highly unlikely to be susceptible

to the threat of manipulation; or

‘‘(C) no cash market;

‘‘(2) that are entered into only between persons that are

eligible contract participants at the time at which the persons

enter into the contract; and

‘‘(3) that are not contracts of sale (or options on such

a contract or on a commodity) for future delivery of any security,

including any group or index of securities or any interest in,

or based on the value of, any security or any group or index

of securities.

‘‘(c) ANTIMANIPULATION REQUIREMENTS.—A party to a contract

of sale of a commodity for future delivery (or option on such a

contract or on a commodity) that is traded on an exempt board

of trade shall be subject to sections 4b, 4c(b), 4o, 6(c), and 9(a)(2),

and the Commission shall enforce those provisions with respect

to any such trading.

114 STAT. 2763A–402 PUBLIC LAW 106–554—APPENDIX E

‘‘(d) PRICE DISCOVERY.—If the Commission finds that an exempt

board of trade is a significant source of price discovery for transactions in the cash market for the commodity underlying any contract, agreement, or transaction traded on or through the facilities

of the board of trade, the board of trade shall disseminate publicly

on a daily basis trading volume, opening and closing price ranges,

open interest, and other trading data as appropriate to the market.

‘‘(e) JURISDICTION.—The Commission shall have exclusive jurisdiction over any account, agreement, contract, or transaction involving a contract of sale of a commodity for future delivery, or option

on such a contract or on a commodity, to the extent that the

account, agreement, contract, or transaction is traded on an exempt

board of trade. ‘‘(f ) SUBSIDIARIES.—A board of trade that is designated as a

contract market or registered as a derivatives transaction execution

facility may operate an exempt board of trade by establishing a

separate subsidiary or other legal entity and otherwise satisfying

the requirements of this section. ‘‘(g) An exempt board of trade that meets the requirements

of subsection (b) shall not represent to any person that the board

of trade is registered with, or designated, recognized, licensed,

or approved by the Commission.’’.

SEC. 115. SUSPENSION OR REVOCATION OF DESIGNATION AS CONTRACT MARKET.

Section 5e of the Commodity Exchange Act (7 U.S.C. 7b) (as

redesignated by section 20(1)) is amended to read as follows:

‘‘SEC. 5e. SUSPENSION OR REVOCATION OF DESIGNATION AS REGISTERED ENTITY.

‘‘The failure of a registered entity to comply with any provision

of this Act, or any regulation or order of the Commission under

this Act, shall be cause for the suspension of the registered entity

for a period not to exceed 180 days, or revocation of designation

as a registered entity in accordance with the procedures and subject

to the judicial review provided in section 6(b).’’.

SEC. 116. AUTHORIZATION OF APPROPRIATIONS.

Section 12(d) of the Commodity Exchange Act (7 U.S.C. 16(d))

is amended by striking ‘‘2000’’ and inserting ‘‘2005’’.

SEC. 117. PREEMPTION.

Section 12 of the Commodity Exchange Act (7 U.S.C. 16(e))

is amended by striking subsection (e) and inserting the following:

‘‘(e) RELATION TO OTHER LAW, DEPARTMENTS, OR AGENCIES.—

‘‘(1) Nothing in this Act shall supersede or preempt—

‘‘(A) criminal prosecution under any Federal criminal

statute;

‘‘(B) the application of any Federal or State statute

(except as provided in paragraph (2)), including any rule

or regulation thereunder, to any transaction in or involving

any commodity, product, right, service, or interest—

‘‘(i) that is not conducted on or subject to the

rules of a registered entity or exempt board of trade;

‘‘(ii) (except as otherwise specified by the Commission by rule or regulation) that is not conducted on

or subject to the rules of any board of trade, exchange,

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–403

or market located outside the United States, its territories or possessions; or ‘‘(iii) that is not subject to regulation by the

Commission under section 4c or 19; or

‘‘(C) the application of any Federal or State statute,

including any rule or regulation thereunder, to any person

required to be registered or designated under this Act

who shall fail or refuse to obtain such registration or designation.

‘‘(2) This Act shall supersede and preempt the application

of any State or local law that prohibits or regulates gaming

or the operation of bucket shops (other than antifraud provisions of general applicability) in the case of—

‘‘(A) an electronic trading facility excluded under section 2(e) of this Act; and

‘‘(B) an agreement, contract, or transaction that is

excluded from this Act under section 2(c), 2(d), 2(f ), or

2(g) of this Act or title IV of the Commodity Futures

Modernization Act of 2000, or exempted under section 2(h)

or 4(c) of this Act (regardless of whether any such agreement, contract, or transaction is otherwise subject to this

Act).’’.

SEC. 118. PREDISPUTE RESOLUTION AGREEMENTS FOR INSTITUTIONAL CUSTOMERS.

Section 14 of the Commodity Exchange Act (7 U.S.C. 18) is

amended by striking subsection (g) and inserting the following:

‘‘(g) PREDISPUTE RESOLUTION AGREEMENTS FOR INSTITUTIONAL

CUSTOMERS.—Nothing in this section prohibits a registered futures

commission merchant from requiring a customer that is an eligible

contract participant, as a condition to the commission merchant’s

conducting a transaction for the customer, to enter into an agreement waiving the right to file a claim under this section.’’.

SEC. 119. CONSIDERATION OF COSTS AND BENEFITS AND ANTITRUST

LAWS.

Section 15 of the Commodity Exchange Act (7 U.S.C. 19) is

amended by striking ‘‘SEC. 15. The Commission’’ and inserting

the following:

‘‘SEC. 15. CONSIDERATION OF COSTS AND BENEFITS AND ANTITRUST

LAWS.

‘‘(a) COSTS AND BENEFITS.—

‘‘(1) IN GENERAL.—Before promulgating a regulation under

this Act or issuing an order (except as provided in paragraph

(3)), the Commission shall consider the costs and benefits of

the action of the Commission.

‘‘(2) CONSIDERATIONS.—The costs and benefits of the proposed Commission action shall be evaluated in light of—

‘‘(A) considerations of protection of market participants

and the public; ‘‘(B) considerations of the efficiency, competitiveness,

and financial integrity of futures markets;

‘‘(C) considerations of price discovery;

‘‘(D) considerations of sound risk management practices; and

‘‘(E) other public interest considerations.

114 STAT. 2763A–404 PUBLIC LAW 106–554—APPENDIX E

‘‘(3) APPLICABILITY.—This subsection does not apply to the

following actions of the Commission: ‘‘(A) An order that initiates, is part of, or is the result

of an adjudicatory or investigative process of the Commission.‘‘(B) An emergency action.

‘‘(C) A finding of fact regarding compliance with a

requirement of the Commission. ‘‘(b) ANTITRUST LAWS.—The Commission’’.

SEC. 120. CONTRACT ENFORCEMENT BETWEEN ELIGIBLE

COUNTERPARTIES.

Section 22(a) of the Commodity Exchange Act (7 U.S.C. 25(a))

is amended by adding at the end the following: ‘‘(4) CONTRACT ENFORCEMENT BETWEEN ELIGIBLE

COUNTERPARTIES.—No agreement, contract, or transaction

between eligible contract participants or persons reasonably

believed to be eligible contract participants, and no hybrid

instrument sold to any investor, shall be void, voidable, or

unenforceable, and no such party shall be entitled to rescind,

or recover any payment made with respect to, such an agreement, contract, transaction, or instrument under this section

or any other provision of Federal or State law, based solely

on the failure of the agreement, contract, transaction, or

instrument to comply with the terms or conditions of an exemption or exclusion from any provision of this Act or regulations

of the Commission.’’.

SEC. 121. SPECIAL PROCEDURES TO ENCOURAGE AND FACILITATE

BONA FIDE HEDGING BY AGRICULTURAL PRODUCERS.

The Commodity Exchange Act, as otherwise amended by this

Act, is amended by inserting after section 4o the following:

‘‘SEC. 4p. SPECIAL PROCEDURES TO ENCOURAGE AND FACILITATE

BONA FIDE HEDGING BY AGRICULTURAL PRODUCERS.

‘‘(a) AUTHORITY.—The Commission shall consider issuing rules

or orders which—

‘‘(1) prescribe procedures under which each contract market

is to provide for orderly delivery, including temporary storage

costs, of any agricultural commodity enumerated in section

1a(4) which is the subject of a contract for purchase or sale

for future delivery;

‘‘(2) increase the ease with which domestic agricultural

producers may participate in contract markets, including by

addressing cost and margin requirements, so as to better enable

the producers to hedge price risk associated with their production;

‘‘(3) provide flexibility in the minimum quantities of such

agricultural commodities that may be the subject of a contract

for purchase or sale for future delivery that is traded on a

contract market, to better allow domestic agricultural producers

to hedge such price risk; and

‘‘(4) encourage contract markets to provide information and

otherwise facilitate the participation of domestic agricultural

producers in contract markets.

‘‘(b) REPORT.—Within 1 year after the date of the enactment

of this section, the Commission shall submit to the Committee

on Agriculture of the House of Representatives and the Committee

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–405

on Agriculture, Nutrition, and Forestry of the Senate a report

on the steps it has taken to implement this section and on the

activities of contract markets pursuant to this section.’’.

SEC. 122. RULE OF CONSTRUCTION.

Except as expressly provided in this Act or an amendment

made by this Act, nothing in this Act or an amendment made

by this Act supersedes, affects, or otherwise limits or expands

the scope and applicability of laws governing the Securities and

Exchange Commission.

SEC. 123. TECHNICAL AND CONFORMING AMENDMENTS.

(a) COMMODITY EXCHANGE ACT.— (1) Section 1a of the Commodity Exchange Act (7 U.S.C.

1a) (as amended by section 101) is amended— (A) in paragraphs (5), (6), (16), (17), (20), and (23),

by inserting ‘‘or derivatives transaction execution facility’’ after ‘‘contract market’’ each place it appears; and

(B) in paragraph (24)— (i) in the paragraph heading, by striking ‘‘CON- TRACT MARKET’’ and inserting ‘‘REGISTERED ENTITY’’;

(ii) by striking ‘‘contract market’’ each place it

appears and inserting ‘‘registered entity’’; and

(iii) by adding at the end the following:

‘‘A participant in an alternative trading system that is designated as a contract market pursuant to section 5f is deemed

a member of the contract market for purposes of transactions

in security futures products through the contract market.’’.

(2) Section 2 of the Commodity Exchange Act (7 U.S.C.

2, 2a, 4, 4a, 3) is amended—

(A) by striking ‘‘SEC. 2. (a)(1)(A)(i) The’’ and inserting

the following:

‘‘SEC. 2. JURISDICTION OF COMMISSION; LIABILITY OF PRINCIPAL FOR

ACT OF AGENT; COMMODITY FUTURES TRADING COMMISSION; TRANSACTION IN INTERSTATE COMMERCE.

‘‘(a) JURISDICTION OF COMMISSION; COMMODITY FUTURES TRADING COMMISSION.—

‘‘(1) JURISDICTION OF COMMISSION.—

‘‘(A) IN GENERAL.—The’’; and

(B) in subsection (a)(1)—

(i) in subparagraph (A) (as amended by subparagraph (A) of this paragraph)—

(I) by striking ‘‘subparagraph (B) of this

subparagraph’’ and inserting ‘‘subparagraphs (C)

and (D) of this paragraph and subsections (c)

through (i) of this section’’;

(II) by striking ‘‘contract market designated

pursuant to section 5 of this Act’’ and inserting

‘‘contract market designated or derivatives transaction execution facility registered pursuant to section 5 or 5a’’;

(III) by striking clause (ii); and

(IV) in clause (iii), by striking ‘‘(iii) The’’ and

inserting the following:

‘‘(B) LIABILITY OF PRINCIPAL FOR ACT OF AGENT.—The’’;

and

(ii) in subparagraph (B)—

114 STAT. 2763A–406 PUBLIC LAW 106–554—APPENDIX E

(I) by striking ‘‘(B)’’ and inserting ‘‘(C)’’;

(II) in clause (v)— (aa) by striking ‘‘section 3 of the Securities

Act of 1933’’; and

(bb) by inserting ‘‘or subparagraph (D)’’

after ‘‘subparagraph’’; and

(III) by moving clauses (i) through (v) 4 ems

to the right;

(C) in subsection (a)(7), by striking ‘‘contract market’’

and inserting ‘‘registered entity’’;

(D) in subsection (a)(8)(B)(ii)—

(i) in the first sentence, by striking ‘‘designation

as a contract market’’ and inserting ‘‘designation or

registration as a contract market or derivatives transaction execution facility’’;

(ii) in the second sentence, by striking ‘‘designate

a board of trade as a contract market’’ and inserting

‘‘designate or register a board of trade as a contract

market or derivatives transaction execution facility’’;

and

(iii) in the fourth sentence, by striking ‘‘designating, or refusing, suspending, or revoking the designation of, a board of trade as a contract market involving

transactions for future delivery referred to in this

clause or in considering possible emergency action

under section 8a(9) of this Act’’ and inserting ‘‘designating, registering, or refusing, suspending, or revoking

the designation or registration of, a board of trade

as a contract market or derivatives transaction execution facility involving transactions for future delivery

referred to in this clause or in considering any possible

action under this Act (including without limitation

emergency action under section 8a(9))’’, and by striking

‘‘designation, suspension, revocation, or emergency

action’’ and inserting ‘‘designation, registration,

suspension, revocation, or action’’; and

(E) in subsection (a), by moving paragraphs (2) through

(9) 2 ems to the right.

(3) Section 4 of the Commodity Exchange Act (7 U.S.C.

6) is amended—

(A) in subsection (a)—

(i) in paragraph (1), by striking ‘‘designated by

the Commission as a ‘contract market’ for’’ and inserting ‘‘designated or registered by the Commission as

a contract market or derivatives transaction execution

facility for’’;

(ii) in paragraph (2), by striking ‘‘member of such’’;

and

(iii) in paragraph (3), by inserting ‘‘or derivatives

transaction execution facility’’ after ‘‘contract market’’;

and

(B) in subsection (c)—

(i) in paragraph (1)—

(I) by striking ‘‘designated as a contract market’’ and inserting ‘‘designated or registered as

a contract market or derivatives transaction execution facility’’; and

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–407

(II) by striking ‘‘section 2(a)(1)(B)’’ and inserting ‘‘subparagraphs (C)(ii) and (D) of section

2(a)(1), except that the Commission and the Securities and Exchange Commission may by rule, regulation, or order jointly exclude any agreement, contract, or transaction from section 2(a)(1)(D)’’; and

(ii) in paragraph (2)(B)(ii), by inserting ‘‘or derivatives transaction execution facility’’ after ‘‘contract market’’.

(4) Section 4a of the Commodity Exchange Act (7 U.S.C.

6a) is amended—

(A) in subsection (a)—

(i) in the first sentence, by inserting ‘‘or derivatives

transaction execution facilities’’ after ‘‘contract markets’’; and

(ii) in the second sentence, by inserting ‘‘or derivatives transaction execution facility’’ after ‘‘contract market’’;

(B) in subsection (b)—

(i) in paragraph (1), by inserting ‘‘, or derivatives

transaction execution facility or facilities,’’ after ‘‘markets’’; and

(ii) in paragraph (2), by inserting ‘‘or derivatives

transaction execution facility’’ after ‘‘contract market’’;

and

(C) in subsection (e)—

(i) by striking ‘‘contract market or’’ each place it

appears and inserting ‘‘contract market, derivatives

transaction execution facility, or’’;

(ii) by striking ‘‘licensed or designated’’ each place

it appears and inserting ‘‘licensed, designated, or registered’’; and

(iii) by striking ‘‘contract market, or’’ and inserting

‘‘contract market or derivatives transaction execution

facility, or’’.

(5) Section 4b(a) of the Commodity Exchange Act (7 U.S.C.

6b(a)) is amended by striking ‘‘contract market’’ each place

it appears and inserting ‘‘registered entity’’.

(6) Sections 4c(g), 4d, 4e, and 4f of the Commodity

Exchange Act (7 U.S.C. 6c(g), 6d, 6e, 6f ) are amended by

inserting ‘‘or derivatives transaction execution facility’’ after

‘‘contract market’’ each place it appears.

(7) Section 4g of the Commodity Exchange Act (7 U.S.C.

6g) is amended—

(A) in subsection (b), by striking ‘‘clearinghouse and

contract market’’ and inserting ‘‘registered entity’’; and

(B) in subsection (f ), by striking ‘‘clearinghouses, contract markets, and exchanges’’ and inserting ‘‘registered

entities’’.

(8) Section 4h of the Commodity Exchange Act (7 U.S.C.

6h) is amended by striking ‘‘contract market’’ each place it

appears and inserting ‘‘registered entity’’.

(9) Section 4i of the Commodity Exchange Act (7 U.S.C.

6i) is amended in the first sentence by inserting ‘‘or derivatives

transaction execution facility’’ after ‘‘contract market’’.

114 STAT. 2763A–408 PUBLIC LAW 106–554—APPENDIX E

(10) Section 4l of the Commodity Exchange Act (7 U.S.C.

6l) is amended by inserting ‘‘or derivatives transaction execution facilities’’ after ‘‘contract markets’’ each place it appears.

(11) Section 4p of the Commodity Exchange Act (7 U.S.C.

6p) is amended—

(A) in the third sentence of subsection (a), by striking

‘‘Act or contract markets’’ and inserting ‘‘Act, contract markets, or derivatives transaction execution facilities’’; and

(B) in subsection (b), by inserting ‘‘derivatives transaction execution facility,’’ after ‘‘contract market,’’.

(12) Section 6 of the Commodity Exchange Act (7 U.S.C.

8, 9, 9a, 9b, 13b, 15) is amended—

(A) in subsection (a)—

(i) in the first sentence—

(I) by striking ‘‘board of trade desiring to be

designated a ‘contract market’ shall make application to the Commission for such designation’’ and

inserting ‘‘person desiring to be designated or registered as a contract market or derivatives transaction execution facility shall make application to

the Commission for the designation or registration’’;

(II) by striking ‘‘above conditions’’ and inserting ‘‘conditions set forth in this Act’’; and

(III) by striking ‘‘above requirements’’ and

inserting ‘‘the requirements of this Act’’;

(ii) in the second sentence, by striking ‘‘designation

as a contract market within one year’’ and inserting

‘‘designation or registration as a contract market or

derivatives transaction execution facility within 180

days’’;

(iii) in the third sentence—

(I) by striking ‘‘board of trade’’ and inserting

‘‘person’’; and

(II) by striking ‘‘one-year period’’ and inserting

‘‘180-day period’’; and

(iv) in the last sentence, by striking ‘‘designate

as a ‘contract market’ any board of trade that has

made application therefor, such board of trade’’ and

inserting ‘‘designate or register as a contract market

or derivatives transaction execution facility any person

that has made application therefor, the person’’;

(B) in subsection (b)—

(i) in the first sentence—

(I) by striking ‘‘designation of any board of

trade as a ‘contract market’ upon’’ and inserting

‘‘designation or registration of any contract market

or derivatives transaction execution facility on’’;

(II) by striking ‘‘board of trade’’ each place

it appears and inserting ‘‘contract market or

derivatives transaction execution facility’’; and

(III) by striking ‘‘designation as set forth in

section 5 of this Act’’ and inserting ‘‘designation

or registration as set forth in sections 5 through

5b or section 5f’’;

(ii) in the second sentence—

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–409

(I) by striking ‘‘board of trade’’ the first place

it appears and inserting ‘‘contract market or

derivatives transaction execution facility’’; and

(II) by striking ‘‘board of trade’’ the second

and third places it appears and inserting ‘‘person’’;

and

(iii) in the last sentence, by striking ‘‘board of

trade’’ each place it appears and inserting ‘‘person’’;

(C) in subsection (c)—

(i) by striking ‘‘contract market’’ each place it

appears and inserting ‘‘registered entity’’;

(ii) by striking ‘‘contract markets’’ each place it

appears and inserting ‘‘registered entities’’; and

(iii) by striking ‘‘trading privileges’’ each place it

appears and inserting ‘‘privileges’’;

(D) in subsection (d), by striking ‘‘contract market’’

each place it appears and inserting ‘‘registered entity’’;

and

(E) in subsection (e), by striking ‘‘trading on all contract

markets’’ each place it appears and inserting ‘‘the privileges

of all registered entities’’.

(13) Section 6a of the Commodity Exchange Act (7 U.S.C.

10a) is amended—

(A) in the first sentence of subsection (a), by striking

‘‘designated as a ‘contract market’ shall’’ and inserting ‘‘designated or registered as a contract market or a derivatives

transaction execution facility’’; and

(B) in subsection (b), by striking ‘‘designated as a contract market’’ and inserting ‘‘designated or registered as

a contract market or a derivatives transaction execution

facility’’.

(14) Section 6b of the Commodity Exchange Act (7 U.S.C.

13a) is amended—

(A) by striking ‘‘contract market’’ each place it appears

and inserting ‘‘registered entity’’;

(B) in the first sentence, by striking ‘‘designation as

set forth in section 5 of this Act’’ and inserting ‘‘designation

or registration as set forth in sections 5 through 5c’’; and

(C) in the last sentence, by striking ‘‘the contract market’s ability’’ and inserting ‘‘the ability of the registered

entity’’.

(15) Section 6c(a) of the Commodity Exchange Act (7 U.S.C.

13a–1(a)) by striking ‘‘contract market’’ and inserting ‘‘registered entity’’.

(16) Section 6d(1) of the Commodity Exchange Act (7 U.S.C.

13a–2(1)) is amended by inserting ‘‘derivatives transaction

execution facility,’’ after ‘‘contract market,’’.

(17) Section 7 of the Commodity Exchange Act (7 U.S.C.

11) is amended—

(A) in the first sentence—

(i) by striking ‘‘board of trade’’ and inserting ‘‘person’’;

(ii) by inserting ‘‘or registered’’ after ‘‘designated’’;

(iii) by inserting ‘‘or registration’’ after ‘‘designation’’ each place it appears; and

(iv) by striking ‘‘contract market’’ each place it

appears and inserting ‘‘registered entity’’;

114 STAT. 2763A–410 PUBLIC LAW 106–554—APPENDIX E

(B) in the second sentence—

(i) by striking ‘‘designation of such board of trade

as a contract market’’ and inserting ‘‘designation or

registration of the registered entity’’; and

(ii) by striking ‘‘contract markets’’ and inserting

‘‘registered entities’’; and

(C) in the last sentence—

(i) by striking ‘‘board of trade’’ and inserting ‘‘person’’; and

(ii) by striking ‘‘designated again a contract market’’ and inserting ‘‘designated or registered again a

registered entity’’.

(18) Section 8(c) of the Commodity Exchange Act (7 U.S.C.

12(c)) is amended in the first sentence by striking ‘‘board of

trade’’ and inserting ‘‘registered entity’’.

(19) Section 8a of the Commodity Exchange Act (7 U.S.C.

12a) is amended—

(A) by striking ‘‘contract market’’ each place it appears

and inserting ‘‘registered entity’’; and

(B) in paragraph (2)(F), by striking ‘‘trading privileges’’

and inserting ‘‘privileges’’.

(20) Sections 8b and 8c(e) of the Commodity Exchange

Act (7 U.S.C. 12b, 12c(e)) are amended by striking ‘‘contract

market’’ each place it appears and inserting ‘‘registered entity’’.

(21) Section 8e of the Commodity Exchange Act (7 U.S.C.

12e) is repealed.

(22) Section 9 of the Commodity Exchange Act (7 U.S.C.

13) is amended by striking ‘‘contract market’’ each place it

appears and inserting ‘‘registered entity’’.

(23) Section 14 of the Commodity Exchange Act (7 U.S.C.

18) is amended—

(A) in subsection (a)(1)(B), by striking ‘‘contract market’’ and inserting ‘‘registered entity’’; and

(B) in subsection (f ), by striking ‘‘contract markets’’

and inserting ‘‘registered entities’’.

(24) Section 17 of the Commodity Exchange Act (7 U.S.C.

21) is amended by striking ‘‘contract market’’ each place it

appears and inserting ‘‘registered entity’’.

(25) Section 22 of the Commodity Exchange Act (7 U.S.C.

25) is amended—

(A) in subsection (a)—

(i) in paragraph (1)—

(I) by striking ‘‘contract market, clearing

organization of a contract market, licensed board

of trade,’’ and inserting ‘‘registered entity’’; and

(II) in subparagraph (C)(i), by striking ‘‘contract market’’ and inserting ‘‘registered entity’’;

(ii) in paragraph (2), by striking ‘‘sections 5a(11),’’

and inserting ‘‘sections 5(d)(13), 5b(b)(1)(E),’’; and

(iii) in paragraph (3), by striking ‘‘contract market’’

and inserting ‘‘registered entity’’; and

(B) in subsection (b)—

(i) in paragraph (1)—

(I) by striking ‘‘contract market or clearing

organization of a contract market’’ and inserting

‘‘registered entity’’;

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–411

(II) by striking ‘‘section 5a(8) and section 5a(9)

of this Act’’ and inserting ‘‘sections 5 through 5c’’;

(III) by striking ‘‘contract market, clearing

organization of a contract market, or licensed

board of trade’’ and inserting ‘‘registered entity’’;

and

(IV) by striking ‘‘contract market or licensed

board of trade’’ and inserting ‘‘registered entity’’;

(ii) in paragraph (3)—

(I) by striking ‘‘a contract market, clearing

organization, licensed board of trade,’’ and inserting ‘‘registered entity’’; and

(II) by striking ‘‘contract market, licensed

board of trade’’ and inserting ‘‘registered entity’’;

(iii) in paragraph (4), by striking ‘‘contract market,

licensed board of trade, clearing organization,’’ and

inserting ‘‘registered entity’’; and

(iv) in paragraph (5), by striking ‘‘contract market,

licensed board of trade, clearing organization,’’ and

inserting ‘‘registered entity’’.

(b) FEDERAL DEPOSIT INSURANCE CORPORATION IMPROVEMENT

ACT OF 1991.—Section 402(2) of the Federal Deposit Insurance

Corporation Improvement Act of 1991 (12 U.S.C. 4402(2)) is amended by striking subparagraph (B) and inserting the following:

‘‘(B) that is registered as a derivatives clearing

organization under section 5b of the Commodity Exchange

Act.’’.

SEC. 124. PRIVACY.

The Commodity Exchange Act (7 U.S.C. 1 et seq.) is amended

by inserting after section 5f (as added by section 252) the following:

‘‘SEC. 5g. PRIVACY.

‘‘(a) TREATMENT AS FINANCIAL INSTITUTIONS.—Notwithstanding

section 509(3)(B) of the Gramm-Leach-Bliley Act, any futures

commission merchant, commodity trading advisor, commodity pool

operator, or introducing broker that is subject to the jurisdiction

of the Commission under this Act with respect to any financial

activity shall be treated as a financial institution for purposes

of title V of such Act with respect to such financial activity.

‘‘(b) TREATMENT OF CFTC AS FEDERAL FUNCTIONAL REGULATOR.—For purposes of title V of such Act, the Commission shall

be treated as a Federal functional regulator within the meaning

of section 509(2) of such Act and shall prescribe regulations under

such title within 6 months after the date of the enactment of

this section.’’.

SEC. 125. REPORT TO CONGRESS.

(a) The Commodity Futures Trading Commission (in this section referred to as the ‘‘Commission’’) shall undertake and complete

a study of the Commodity Exchange Act (in this section referred

to as ‘‘the Act’’) and the Commission’s rules, regulations and orders

governing the conduct of persons required to be registered under

the Act, not later than 1 year after the date of the enactment

of this Act. The study shall identify—

(1) the core principles and interpretations of acceptable

business practices that the Commission has adopted or intends

114 STAT. 2763A–412 PUBLIC LAW 106–554—APPENDIX E

to adopt to replace the provisions of the Act and the Commission’s rules and regulations thereunder;

(2) the rules and regulations that the Commission has

determined must be retained and the reasons therefor;

(3) the extent to which the Commission believes it can

effect the changes identified in paragraph (1) of this subsection

through its exemptive authority under section 4(c) of the Act;

and

(4) the regulatory functions the Commission currently performs that can be delegated to a registered futures association

(within the meaning of the Act) and the regulatory functions

that the Commission has determined must be retained and

the reasons therefor.

(b) In conducting the study, the Commission shall solicit the

views of the public as well as Commission registrants, registered

entities, and registered futures associations (all within the meaning

of the Act).

(c) The Commission shall transmit to the Committee on Agriculture of the House of Representatives and the Committee on

Agriculture, Nutrition, and Forestry of the Senate a report of the

results of its study, which shall include an analysis of comments

received.

SEC. 126. INTERNATIONAL ACTIVITIES OF THE COMMODITY FUTURES

TRADING COMMISSION.

(a) FINDINGS.—The Congress finds that—

(1) derivatives markets serving United States industry are

increasingly global in scope;

(2) developments in data processing and communications

technologies enable users of risk management services to analyze and compare those services on a worldwide basis;

(3) financial services regulatory policy must be flexible

to account for rapidly changing derivatives industry business

practices;

(4) regulatory impediments to the operation of global business interests can compromise the competitiveness of United

States businesses;

(5) events that disrupt financial markets and economies

are often global in scope, require rapid regulatory response,

and coordinated regulatory effort across international jurisdictions;

(6) through its membership in the International

Organisation of Securities Commissions, the Commodity

Futures Trading Commission has promoted beneficial communication among market regulators and international regulatory

cooperation; and

(7) the Commodity Futures Trading Commission and other

United States financial regulators and self-regulatory organizations should continue to foster productive and cooperative working relationships with their counterparts in foreign jurisdictions.

(b) SENSE OF THE CONGRESS.—It is the sense of the Congress

that, consistent with its responsibilities under the Commodity

Exchange Act, the Commodity Futures Trading Commission should,

as part of its international activities, continue to coordinate with

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–413

foreign regulatory authorities, to participate in international regulatory organizations and forums, and to provide technical assistance

to foreign government authorities, in order to encourage— (1) the facilitation of cross-border transactions through the

removal or lessening of any unnecessary legal or practical

obstacles;

(2) the development of internationally accepted regulatory

standards of best practice;

(3) the enhancement of international supervisory cooperation and emergency procedures;

(4) the strengthening of international cooperation for customer and market protection; and

(5) improvements in the quality and timeliness of international information sharing.

TITLE II—COORDINATED REGULATION

OF SECURITY FUTURES PRODUCTS

Subtitle A—Securities Law Amendments

SEC. 201. DEFINITIONS UNDER THE SECURITIES EXCHANGE ACT OF

1934.

Section 3(a) of the Securities Exchange Act of 1934 (15 U.S.C.

78c(a)) is amended—

(1) in paragraph (10), by inserting ‘‘security future,’’ after

‘‘treasury stock,’’;

(2) by striking paragraph (11) and inserting the following:

‘‘(11) The term ‘equity security’ means any stock or similar

security; or any security future on any such security; or any

security convertible, with or without consideration, into such

a security, or carrying any warrant or right to subscribe to

or purchase such a security; or any such warrant or right;

or any other security which the Commission shall deem to

be of similar nature and consider necessary or appropriate,

by such rules and regulations as it may prescribe in the public

interest or for the protection of investors, to treat as an equity

security.’’;

(3) in paragraph (13), by adding at the end the following:

‘‘For security futures products, such term includes any contract,

agreement, or transaction for future delivery.’’;

(4) in paragraph (14), by adding at the end the following:

‘‘For security futures products, such term includes any contract,

agreement, or transaction for future delivery.’’; and

(5) by adding at the end the following:

‘‘(55)(A) The term ‘security future’ means a contract of

sale for future delivery of a single security or of a narrowbased security index, including any interest therein or based

on the value thereof, except an exempted security under section

3(a)(12) of the Securities Exchange Act of 1934 as in effect

on the date of the enactment of the Futures Trading Act of

1982 (other than any municipal security as defined in section

3(a)(29) as in effect on the date of the enactment of the Futures

Trading Act of 1982). The term ‘security future’ does not include

any agreement, contract, or transaction excluded from the

Commodity Exchange Act under section 2(c), 2(d), 2(f ), or 2(g)

114 STAT. 2763A–414 PUBLIC LAW 106–554—APPENDIX E

of the Commodity Exchange Act (as in effect on the date of

the enactment of the Commodity Futures Modernization Act

of 2000) or title IV of the Commodity Futures Modernization

Act of 2000.

‘‘(B) The term ‘narrow-based security index’ means an

index—

‘‘(i) that has 9 or fewer component securities;

‘‘(ii) in which a component security comprises more

than 30 percent of the index’s weighting;

‘‘(iii) in which the five highest weighted component

securities in the aggregate comprise more than 60 percent

of the index’s weighting; or

‘‘(iv) in which the lowest weighted component securities

comprising, in the aggregate, 25 percent of the index’s

weighting have an aggregate dollar value of average daily

trading volume of less than $50,000,000 (or in the case

of an index with 15 or more component securities,

$30,000,000), except that if there are two or more securities

with equal weighting that could be included in the calculation of the lowest weighted component securities comprising, in the aggregate, 25 percent of the index’s weighting,

such securities shall be ranked from lowest to highest

dollar value of average daily trading volume and shall

be included in the calculation based on their ranking starting with the lowest ranked security.

‘‘(C) Notwithstanding subparagraph (B), an index is not

a narrow-based security index if—

‘‘(i)(I) it has at least nine component securities;

‘‘(II) no component security comprises more than 30

percent of the index’s weighting; and

‘‘(III) each component security is—

‘‘(aa) registered pursuant to section 12 of the Securities Exchange Act of 1934;

‘‘(bb) one of 750 securities with the largest market

capitalization; and

‘‘(cc) one of 675 securities with the largest dollar

value of average daily trading volume;

‘‘(ii) a board of trade was designated as a contract

market by the Commodity Futures Trading Commission

with respect to a contract of sale for future delivery on

the index, before the date of the enactment of the Commodity Futures Modernization Act of 2000;

‘‘(iii)(I) a contract of sale for future delivery on the

index traded on a designated contract market or registered

derivatives transaction execution facility for at least 30

days as a contract of sale for future delivery on an index

that was not a narrow-based security index; and

‘‘(II) it has been a narrow-based security index for

no more than 45 business days over 3 consecutive calendar

months;

‘‘(iv) a contract of sale for future delivery on the index

is traded on or subject to the rules of a foreign board

of trade and meets such requirements as are jointly established by rule or regulation by the Commission and the

Commodity Futures Trading Commission;

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–415

‘‘(v) no more than 18 months have passed since the

date of the enactment of the Commodity Futures Modernization Act of 2000 and— ‘‘(I) it is traded on or subject to the rules of a

foreign board of trade;

‘‘(II) the offer and sale in the United States of

a contract of sale for future delivery on the index

was authorized before the date of the enactment of

the Commodity Futures Modernization Act of 2000;

and

‘‘(III) the conditions of such authorization continue

to be met; or

‘‘(vi) a contract of sale for future delivery on the index

is traded on or subject to the rules of a board of trade

and meets such requirements as are jointly established

by rule, regulation, or order by the Commission and the

Commodity Futures Trading Commission.

‘‘(D) Within 1 year after the enactment of the Commodity

Futures Modernization Act of 2000, the Commission and the

Commodity Futures Trading Commission jointly shall adopt

rules or regulations that set forth the requirements under

clause (iv) of subparagraph (C).

‘‘(E) An index that is a narrow-based security index solely

because it was a narrow-based security index for more than

45 business days over 3 consecutive calendar months pursuant

to clause (iii) of subparagraph (C) shall not be a narrow-based

security index for the 3 following calendar months.

‘‘(F) For purposes of subparagraphs (B) and (C) of this

paragraph—

‘‘(i) the dollar value of average daily trading volume

and the market capitalization shall be calculated as of

the preceding 6 full calendar months; and

‘‘(ii) the Commission and the Commodity Futures Trading Commission shall, by rule or regulation, jointly specify

the method to be used to determine market capitalization

and dollar value of average daily trading volume.

‘‘(56) The term ‘security futures product’ means a security

future or any put, call, straddle, option, or privilege on any

security future.

‘‘(57)(A) The term ‘margin’, when used with respect to

a security futures product, means the amount, type, and form

of collateral required to secure any extension or maintenance

of credit, or the amount, type, and form of collateral required

as a performance bond related to the purchase, sale, or carrying

of a security futures product.

‘‘(B) The terms ‘margin level’ and ‘level of margin’, when

used with respect to a security futures product, mean the

amount of margin required to secure any extension or maintenance of credit, or the amount of margin required as a performance bond related to the purchase, sale, or carrying of a security

futures product.

‘‘(C) The terms ‘higher margin level’ and ‘higher level of

margin’, when used with respect to a security futures product,

mean a margin level established by a national securities

exchange registered pursuant to section 6(g) that is higher

than the minimum amount established and in effect pursuant

to section 7(c)(2)(B).’’.

114 STAT. 2763A–416 PUBLIC LAW 106–554—APPENDIX E

SEC. 202. REGULATORY RELIEF FOR MARKETS TRADING SECURITY

FUTURES PRODUCTS.

(a) EXPEDITED REGISTRATION AND EXEMPTION.—Section 6 of

the Securities Exchange Act of 1934 (15 U.S.C. 78f ) is amended

by adding at the end the following:

‘‘(g) NOTICE REGISTRATION OF SECURITY FUTURES PRODUCT

EXCHANGES.—

‘‘(1) REGISTRATION REQUIRED.—An exchange that lists or

trades security futures products may register as a national

securities exchange solely for the purposes of trading security

futures products if—

‘‘(A) the exchange is a board of trade, as that term

is defined by the Commodity Exchange Act (7 U.S.C. 1a(2)),

that—

‘‘(i) has been designated a contract market by the

Commodity Futures Trading Commission and such designation is not suspended by order of the Commodity

Futures Trading Commission; or

‘‘(ii) is registered as a derivative transaction execution facility under section 5a of the Commodity

Exchange Act and such registration is not suspended

by the Commodity Futures Trading Commission; and

‘‘(B) such exchange does not serve as a market place

for transactions in securities other than—

‘‘(i) security futures products; or

‘‘(ii) futures on exempted securities or groups or

indexes of securities or options thereon that have been

authorized under section 2(a)(1)(C) of the Commodity

Exchange Act.

‘‘(2) REGISTRATION BY NOTICE FILING.—

‘‘(A) FORM AND CONTENT.—An exchange required to

register only because such exchange lists or trades security

futures products may register for purposes of this section

by filing with the Commission a written notice in such

form as the Commission, by rule, may prescribe containing

the rules of the exchange and such other information and

documents concerning such exchange, comparable to the

information and documents required for national securities

exchanges under section 6(a), as the Commission, by rule,

may prescribe as necessary or appropriate in the public

interest or for the protection of investors. If such exchange

has filed documents with the Commodity Futures Trading

Commission, to the extent that such documents contain

information satisfying the Commission’s informational

requirements, copies of such documents may be filed with

the Commission in lieu of the required written notice.

‘‘(B) IMMEDIATE EFFECTIVENESS.—Such registration

shall be effective contemporaneously with the submission

of notice, in written or electronic form, to the Commission,

except that such registration shall not be effective if such

registration would be subject to suspension or revocation.

‘‘(C) TERMINATION.—Such registration shall be terminated immediately if any of the conditions for registration

set forth in this subsection are no longer satisfied.

‘‘(3) PUBLIC AVAILABILITY.—The Commission shall promptly

publish in the Federal Register an acknowledgment of receipt

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–417

of all notices the Commission receives under this subsection

and shall make all such notices available to the public.

‘‘(4) EXEMPTION OF EXCHANGES FROM SPECIFIED PROVISIONS.—

‘‘(A) TRANSACTION EXEMPTIONS.—An exchange that is

registered under paragraph (1) of this subsection shall

be exempt from, and shall not be required to enforce compliance by its members with, and its members shall not,

solely with respect to those transactions effected on such

exchange in security futures products, be required to comply with, the following provisions of this title and the

rules thereunder:

‘‘(i) Subsections (b)(2), (b)(3), (b)(4), (b)(7), (b)(9),

(c), (d), and (e) of this section.

‘‘(ii) Section 8.

‘‘(iii) Section 11.

‘‘(iv) Subsections (d), (f ), and (k) of section 17.

‘‘(v) Subsections (a), (f ), and (h) of section 19.

‘‘(B) RULE CHANGE EXEMPTIONS.—An exchange that

registered under paragraph (1) of this subsection shall

also be exempt from submitting proposed rule changes

pursuant to section 19(b) of this title, except that—

‘‘(i) such exchange shall file proposed rule changes

related to higher margin levels, fraud or manipulation,

recordkeeping, reporting, listing standards, or decimal

pricing for security futures products, sales practices

for security futures products for persons who effect

transactions in security futures products, or rules effectuating such exchange’s obligation to enforce the securities laws pursuant to section 19(b)(7);

‘‘(ii) such exchange shall file pursuant to sections

19(b)(1) and 19(b)(2) proposed rule changes related

to margin, except for changes resulting in higher margin levels; and

‘‘(iii) such exchange shall file pursuant to section

19(b)(1) proposed rule changes that have been abrogated by the Commission pursuant to section

19(b)(7)(C).

‘‘(5) TRADING IN SECURITY FUTURES PRODUCTS.—

‘‘(A) IN GENERAL.—Subject to subparagraph (B), it shall

be unlawful for any person to execute or trade a security

futures product until the later of—

‘‘(i) 1 year after the date of the enactment of the

Commodity Futures Modernization Act of 2000; or

‘‘(ii) such date that a futures association registered

under section 17 of the Commodity Exchange Act has

met the requirements set forth in section 15A(k)(2)

of this title.

‘‘(B) PRINCIPAL-TO-PRINCIPAL TRANSACTIONS.—Notwithstanding subparagraph (A), a person may execute or trade

a security futures product transaction if—

‘‘(i) the transaction is entered into—

‘‘(I) on a principal-to-principal basis between

parties trading for their own accounts or as

described in section 1a(12)(B)(ii) of the Commodity

Exchange Act; and

114 STAT. 2763A–418 PUBLIC LAW 106–554—APPENDIX E

‘‘(II) only between eligible contract participants (as defined in subparagraphs (A), (B)(ii),

and (C) of such section 1a(12)) at the time at

which the persons enter into the agreement, contract, or transaction; and

‘‘(ii) the transaction is entered into on or after

the later of—

‘‘(I) 8 months after the date of the enactment

of the Commodity Futures Modernization Act of

2000; or

‘‘(II) such date that a futures association registered under section 17 of the Commodity

Exchange Act has met the requirements set forth

in section 15A(k)(2) of this title.’’.

(b) COMMISSION REVIEW OF PROPOSED RULE CHANGES.— (1) EXPEDITED REVIEW.—Section 19(b) of the Securities

Exchange Act of 1934 (15 U.S.C. 78s(b)) is amended by adding

at the end the following: ‘‘(7) SECURITY FUTURES PRODUCT RULE CHANGES.—

‘‘(A) FILING REQUIRED.—A self-regulatory organization

that is an exchange registered with the Commission pursuant to section 6(g) of this title or that is a national securities

association registered pursuant to section 15A(k) of this

title shall file with the Commission, in accordance with

such rules as the Commission may prescribe, copies of

any proposed rule change or any proposed change in, addition to, or deletion from the rules of such self-regulatory

organization (hereinafter in this paragraph collectively

referred to as a ‘proposed rule change’) that relates to

higher margin levels, fraud or manipulation, recordkeeping,

reporting, listing standards, or decimal pricing for security

futures products, sales practices for security futures products for persons who effect transactions in security futures

products, or rules effectuating such self-regulatory

organization’s obligation to enforce the securities laws.

Such proposed rule change shall be accompanied by a concise general statement of the basis and purpose of such

proposed rule change. The Commission shall, upon the

filing of any proposed rule change, promptly publish notice

thereof together with the terms of substance of the proposed

rule change or a description of the subjects and issues

involved. The Commission shall give interested persons

an opportunity to submit data, views, and arguments

concerning such proposed rule change.

‘‘(B) FILING WITH CFTC.—A proposed rule change filed

with the Commission pursuant to subparagraph (A) shall

be filed concurrently with the Commodity Futures Trading

Commission. Such proposed rule change may take effect

upon filing of a written certification with the Commodity

Futures Trading Commission under section 5c(c) of the

Commodity Exchange Act, upon a determination by the

Commodity Futures Trading Commission that review of

the proposed rule change is not necessary, or upon approval

of the proposed rule change by the Commodity Futures

Trading Commission.

‘‘(C) ABROGATION OF RULE CHANGES.—Any proposed

rule change of a self-regulatory organization that has taken

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–419

effect pursuant to subparagraph (B) may be enforced by

such self-regulatory organization to the extent such rule

is not inconsistent with the provisions of this title, the

rules and regulations thereunder, and applicable Federal

law. At any time within 60 days of the date of the filing

of a written certification with the Commodity Futures Trading Commission under section 5c(c) of the Commodity

Exchange Act, the date the Commodity Futures Trading

Commission determines that review of such proposed rule

change is not necessary, or the date the Commodity Futures

Trading Commission approves such proposed rule change,

the Commission, after consultation with the Commodity

Futures Trading Commission, may summarily abrogate the

proposed rule change and require that the proposed rule

change be refiled in accordance with the provisions of paragraph (1), if it appears to the Commission that such proposed rule change unduly burdens competition or efficiency,

conflicts with the securities laws, or is inconsistent with

the public interest and the protection of investors. Commission action pursuant to the preceding sentence shall not

affect the validity or force of the rule change during the

period it was in effect and shall not be reviewable under

section 25 of this title nor deemed to be a final agency

action for purposes of section 704 of title 5, United States

Code.

‘‘(D) REVIEW OF RESUBMITTED ABROGATED RULES.—

‘‘(i) PROCEEDINGS.—Within 35 days of the date of

publication of notice of the filing of a proposed rule

change that is abrogated in accordance with subparagraph (C) and refiled in accordance with paragraph

(1), or within such longer period as the Commission

may designate up to 90 days after such date if the

Commission finds such longer period to be appropriate

and publishes its reasons for so finding or as to which

the self-regulatory organization consents, the Commission shall—

‘‘(I) by order approve such proposed rule

change; or

‘‘(II) after consultation with the Commodity

Futures Trading Commission, institute proceedings to determine whether the proposed rule

change should be disapproved. Proceedings under

subclause (II) shall include notice of the grounds

for disapproval under consideration and opportunity for hearing and be concluded within 180

days after the date of publication of notice of the

filing of the proposed rule change. At the conclusion of such proceedings, the Commission, by order,

shall approve or disapprove such proposed rule

change. The Commission may extend the time for

conclusion of such proceedings for up to 60 days

if the Commission finds good cause for such extension and publishes its reasons for so finding or

for such longer period as to which the self-regulatory organization consents.

114 STAT. 2763A–420 PUBLIC LAW 106–554—APPENDIX E

‘‘(ii) GROUNDS FOR APPROVAL.—The Commission

shall approve a proposed rule change of a self-regulatory organization under this subparagraph if the

Commission finds that such proposed rule change does

not unduly burden competition or efficiency, does not

conflict with the securities laws, and is not inconsistent

with the public interest or the protection of investors.

The Commission shall disapprove such a proposed rule

change of a self-regulatory organization if it does not

make such finding. The Commission shall not approve

any proposed rule change prior to the 30th day after

the date of publication of notice of the filing thereof,

unless the Commission finds good cause for so doing

and publishes its reasons for so finding.’’.

(2) DECIMAL PRICING PROVISIONS.—Section 19(b) of the

Securities Exchange Act of 1934 (15 U.S.C. 78s(b)) is amended

by inserting after paragraph (7), as added by paragraph (1),

the following: ‘‘(8) DECIMAL PRICING.—Not later than 9 months after the

date on which trading in any security futures product commences under this title, all self-regulatory organizations listing

or trading security futures products shall file proposed rule

changes necessary to implement decimal pricing of security

futures products. The Commission may not require such rules

to contain equal minimum increments in such decimal pricing.’’.

(3) CONSULTATION PROVISIONS.—Section 19(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78s(b)) is amended by

inserting after paragraph (8), as added by paragraph (2), the

following:

‘‘(9) CONSULTATION WITH CFTC.—

‘‘(A) CONSULTATION REQUIRED.—The Commission shall

consult with and consider the views of the Commodity

Futures Trading Commission prior to approving or disapproving a proposed rule change filed by a national securities association registered pursuant to section 15A(a) or

a national securities exchange subject to the provisions

of subsection (a) that primarily concerns conduct related

to transactions in security futures products, except where

the Commission determines that an emergency exists

requiring expeditious or summary action and publishes

its reasons therefor.

‘‘(B) RESPONSES TO CFTC COMMENTS AND FINDINGS.—

If the Commodity Futures Trading Commission comments

in writing to the Commission on a proposed rule that

has been published for comment, the Commission shall

respond in writing to such written comment before approving or disapproving the proposed rule. If the Commodity

Futures Trading Commission determines, and notifies the

Commission, that such rule, if implemented or as applied,

would—

‘‘(i) adversely affect the liquidity or efficiency of

the market for security futures products; or

‘‘(ii) impose any burden on competition not necessary or appropriate in furtherance of the purposes

of this section,

the Commission shall, prior to approving or disapproving

the proposed rule, find that such rule is necessary and

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–421

appropriate in furtherance of the purposes of this section

notwithstanding the Commodity Futures Trading Commission’s determination.’’.

(c) REVIEW OF DISCIPLINARY PROCEEDINGS.—Section 19(d) of

the Securities Exchange Act of 1934 (15 U.S.C. 78s(d)) is amended

by adding at the end the following:

‘‘(3) The provisions of this subsection shall apply to an exchange

registered pursuant to section 6(g) of this title or a national securities association registered pursuant to section 15A(k) of this title

only to the extent that such exchange or association imposes any

final disciplinary sanction for—

‘‘(A) a violation of the Federal securities laws or the rules

and regulations thereunder; or

‘‘(B) a violation of a rule of such exchange or association,

as to which a proposed change would be required to be filed

under section 19 of this title, except that, to the extent that

the exchange or association rule violation relates to any

account, agreement, contract, or transaction, this subsection

shall apply only to the extent such violation involves a security

futures product.’’.

SEC. 203. REGULATORY RELIEF FOR INTERMEDIARIES TRADING SECURITY FUTURES PRODUCTS.

(a) EXPEDITED REGISTRATION AND EXEMPTIONS.—

(1) AMENDMENT.—Section 15(b) of the Securities Exchange

Act of 1934 (15 U.S.C. 78o(b)) is amended by adding at the

end the following:

‘‘(11) BROKER/DEALER REGISTRATION WITH RESPECT TO

TRANSACTIONS IN SECURITY FUTURES PRODUCTS.—

‘‘(A) NOTICE REGISTRATION.—

‘‘(i) CONTENTS OF NOTICE.—Notwithstanding paragraphs (1) and (2), a broker or dealer required to

register only because it effects transactions in security

futures products on an exchange registered pursuant

to section 6(g) may register for purposes of this section

by filing with the Commission a written notice in such

form and containing such information concerning such

broker or dealer and any persons associated with such

broker or dealer as the Commission, by rule, may

prescribe as necessary or appropriate in the public

interest or for the protection of investors. A broker

or dealer may not register under this paragraph unless

that broker or dealer is a member of a national securities association registered under section 15A(k).

‘‘(ii) IMMEDIATE EFFECTIVENESS.—Such registration

shall be effective contemporaneously with the submission of notice, in written or electronic form, to the

Commission, except that such registration shall not

be effective if the registration would be subject to

suspension or revocation under paragraph (4).

‘‘(iii) SUSPENSION.—Such registration shall be suspended immediately if a national securities association

registered pursuant to section 15A(k) of this title suspends the membership of that broker or dealer.

‘‘(iv) TERMINATION.—Such registration shall be

terminated immediately if any of the above stated

114 STAT. 2763A–422 PUBLIC LAW 106–554—APPENDIX E

conditions for registration set forth in this paragraph

are no longer satisfied.

‘‘(B) EXEMPTIONS FOR REGISTERED BROKERS AND

DEALERS.—A broker or dealer registered pursuant to the

requirements of subparagraph (A) shall be exempt from

the following provisions of this title and the rules thereunder with respect to transactions in security futures products: ‘‘(i) Section 8.

‘‘(ii) Section 11.

‘‘(iii) Subsections (c)(3) and (c)(5) of this section.

‘‘(iv) Section 15B.

‘‘(v) Section 15C.

‘‘(vi) Subsections (d), (e), (f ), (g), (h), and (i) of

section 17.’’. (2) CONFORMING AMENDMENT.—Section 28(e) of the Securities Exchange Act of 1934 (15 U.S.C. 78bb(e)) is amended

by adding at the end the following:

‘‘(4) The provisions of this subsection shall not apply with

regard to securities that are security futures products.’’. (b) FLOOR BROKERS AND FLOOR TRADERS.—Section 15(b) of

the Securities Exchange Act of 1934 (15 U.S.C. 78o(b)) is amended

by inserting after paragraph (11), as added by subsection (a), the

following:

‘‘(12) EXEMPTION FOR SECURITY FUTURES PRODUCT

EXCHANGE MEMBERS.—

‘‘(A) REGISTRATION EXEMPTION.—A natural person shall

be exempt from the registration requirements of this section if such person—

‘‘(i) is a member of a designated contract market

registered with the Commission as an exchange pursuant to section 6(g);

‘‘(ii) effects transactions only in securities on the

exchange of which such person is a member; and

‘‘(iii) does not directly accept or solicit orders from

public customers or provide advice to public customers

in connection with the trading of security futures products.

‘‘(B) OTHER EXEMPTIONS.—A natural person exempt

from registration pursuant to subparagraph (A) shall also

be exempt from the following provisions of this title and

the rules thereunder:

‘‘(i) Section 8.

‘‘(ii) Section 11.

‘‘(iii) Subsections (c)(3), (c)(5), and (e) of this section.

‘‘(iv) Section 15B.

‘‘(v) Section 15C.

‘‘(vi) Subsections (d), (e), (f ), (g), (h), and (i) of

section 17.’’.

(c) LIMITED PURPOSE NATIONAL SECURITIES ASSOCIATION.—Section 15A of the Securities Exchange Act of 1934 (15 U.S.C. 78o–

3) is amended by adding at the end the following:

‘‘(k) LIMITED PURPOSE NATIONAL SECURITIES ASSOCIATION.—

‘‘(1) REGULATION OF MEMBERS WITH RESPECT TO SECURITY

FUTURES PRODUCTS.—A futures association registered under

section 17 of the Commodity Exchange Act shall be a registered

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–423

national securities association for the limited purpose of regulating the activities of members who are registered as brokers

or dealers in security futures products pursuant to section

15(b)(11).

‘‘(2) REQUIREMENTS FOR REGISTRATION.—Such a securities

association shall— ‘‘(A) be so organized and have the capacity to carry

out the purposes of the securities laws applicable to security

futures products and to comply, and (subject to any rule

or order of the Commission pursuant to section 19(g)(2))

to enforce compliance by its members and persons associated with its members, with the provisions of the securities

laws applicable to security futures products, the rules and

regulations thereunder, and its rules; ‘‘(B) have rules that— ‘‘(i) are designed to prevent fraudulent and

manipulative acts and practices, to promote just and

equitable principles of trade, and, in general, to protect

investors and the public interest, including rules

governing sales practices and the advertising of security futures products reasonably comparable to those

of other national securities associations registered

pursuant to subsection (a) that are applicable to security futures products; and ‘‘(ii) are not designed to regulate by virtue of any

authority conferred by this title matters not related

to the purposes of this title or the administration of

the association;

‘‘(C) have rules that provide that (subject to any rule

or order of the Commission pursuant to section 19(g)(2))

its members and persons associated with its members shall

be appropriately disciplined for violation of any provision

of the securities laws applicable to security futures products, the rules or regulations thereunder, or the rules of

the association, by expulsion, suspension, limitation of

activities, functions, and operations, fine, censure, being

suspended or barred from being associated with a member,

or any other fitting sanction; and

‘‘(D) have rules that ensure that members and natural

persons associated with members meet such standards of

training, experience, and competence necessary to effect

transactions in security futures products and are tested

for their knowledge of securities and security futures products.

‘‘(3) EXEMPTION FROM RULE CHANGE SUBMISSION.—Such a

securities association shall be exempt from submitting proposed

rule changes pursuant to section 19(b) of this title, except

that—

‘‘(A) the association shall file proposed rule changes

related to higher margin levels, fraud or manipulation,

recordkeeping, reporting, listing standards, or decimal pricing for security futures products, sales practices for,

advertising of, or standards of training, experience, competence, or other qualifications for security futures products

for persons who effect transactions in security futures products, or rules effectuating the association’s obligation to

enforce the securities laws pursuant to section 19(b)(7);

114 STAT. 2763A–424 PUBLIC LAW 106–554—APPENDIX E

‘‘(B) the association shall file pursuant to sections

19(b)(1) and 19(b)(2) proposed rule changes related to margin, except for changes resulting in higher margin levels;

and

‘‘(C) the association shall file pursuant to section

19(b)(1) proposed rule changes that have been abrogated

by the Commission pursuant to section 19(b)(7)(C).

‘‘(4) OTHER EXEMPTIONS.—Such a securities association

shall be exempt from and shall not be required to enforce

compliance by its members, and its members shall not, solely

with respect to their transactions effected in security futures

products, be required to comply, with the following provisions

of this title and the rules thereunder: ‘‘(A) Section 8.

‘‘(B) Subsections (b)(1), (b)(3), (b)(4), (b)(5), (b)(8),

(b)(10), (b)(11), (b)(12), (b)(13), (c), (d), (e), (f ), (g), (h),

and (i) of this section. ‘‘(C) Subsections (d), (f ), and (k) of section 17.

‘‘(D) Subsections (a), (f ), and (h) of section 19.’’. (d) EXEMPTION UNDER THE SECURITIES INVESTOR PROTECTION

ACT OF 1970.—

(1) Section 16(14) of the Securities Investor Protection Act

of 1970 (15 U.S.C. 78lll(14)) is amended by inserting ‘‘or any

security future as that term is defined in section 3(a)(55)(A)

of the Securities Exchange Act of 1934,’’ after ‘‘certificate of

deposit for a security,’’.

(2) Section 3(a)(2)(A) of the Securities Investor Protection

Act of 1970 (15 U.S.C. 78ccc(a)(2)(A)) is amended—

(A) in clause (i), by striking ‘‘and’’ after the semicolon;

(B) in clause (ii), by striking the period and inserting

‘‘; and’’; and

(C) by adding at the end the following:

‘‘(iii) persons who are registered as a broker or

dealer pursuant to section 15(b)(11)(A) of the Securities

Exchange Act of 1934.’’.

SEC. 204. SPECIAL PROVISIONS FOR INTERAGENCY COOPERATION.

Section 17(b) of the Securities Exchange Act of 1934 (15 U.S.C.

78q(b)) is amended—

(1) by striking ‘‘(b) All’’ and inserting the following:

‘‘(b) RECORDS SUBJECT TO EXAMINATION.—

‘‘(1) PROCEDURES FOR COOPERATION WITH OTHER AGENCIES.—All’’;

(2) by striking ‘‘prior to conducting any such examination

of a registered clearing’’ and inserting the following: ‘‘prior

to conducting any such examination of a—

‘‘(A) registered clearing’’;

(3) by redesignating the last sentence as paragraph (4)(C);

(4) by striking the period at the end of the first sentence

and inserting the following: ‘‘; or

‘‘(B) broker or dealer registered pursuant to section

15(b)(11), exchange registered pursuant to section 6(g), or

national securities association registered pursuant to section 15A(k) gives notice to the Commodity Futures Trading

Commission of such proposed examination and consults

with the Commodity Futures Trading Commission concerning the feasibility and desirability of coordinating such

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–425

examination with examinations conducted by the Commodity Futures Trading Commission in order to avoid unnecessary regulatory duplication or undue regulatory burdens

for such broker or dealer or exchange.’’;

(5) by adding at the end the following new paragraphs:

‘‘(2) FURNISHING DATA AND REPORTS TO CFTC.—The

Commission shall notify the Commodity Futures Trading

Commission of any examination conducted of any broker or

dealer registered pursuant to section 15(b)(11), exchange registered pursuant to section 6(g), or national securities association registered pursuant to section 15A(k) and, upon request,

furnish to the Commodity Futures Trading Commission any

examination report and data supplied to, or prepared by, the

Commission in connection with such examination. ‘‘(3) USE OF CFTC REPORTS.—Prior to conducting an examination under paragraph (1), the Commission shall use the

reports of examinations, if the information available therein

is sufficient for the purposes of the examination, of— ‘‘(A) any broker or dealer registered pursuant to section

15(b)(11); ‘‘(B) exchange registered pursuant to section 6(g); or

‘‘(C) national securities association registered pursuant

to section 15A(k);

that is made by the Commodity Futures Trading Commission,

a national securities association registered pursuant to section

15A(k), or an exchange registered pursuant to section 6(g). ‘‘(4) RULES OF CONSTRUCTION.—

‘‘(A) Notwithstanding any other provision of this subsection, the records of a broker or dealer registered pursuant to section 15(b)(11), an exchange registered pursuant

to section 6(g), or a national securities association registered pursuant to section 15A(k) described in this

subparagraph shall not be subject to routine periodic

examinations by the Commission.

‘‘(B) Any recordkeeping rules adopted under this subsection for a broker or dealer registered pursuant to section

15(b)(11), an exchange registered pursuant to section 6(g),

or a national securities association registered pursuant to

section 15A(k) shall be limited to records with respect

to persons, accounts, agreements, contracts, and transactions involving security futures products.’’; and

(6) in paragraph (4)(C) (as redesignated by paragraph (3)

of this section), by striking ‘‘Nothing in the proviso to the

preceding sentence’’ and inserting ‘‘Nothing in the proviso in

paragraph (1)’’.

SEC. 205. MAINTENANCE OF MARKET INTEGRITY FOR SECURITY

FUTURES PRODUCTS.

(a) ADDITION OF SECURITY FUTURES PRODUCTS TO OPTION-SPECIFIC ENFORCEMENT PROVISIONS.—

(1) PROHIBITION AGAINST MANIPULATION.—Section 9(b) of

the Securities Exchange Act of 1934 (15 U.S.C. 78i(b)) is

amended—

(A) in paragraph (1)—

(i) by inserting ‘‘(A)’’ after ‘‘acquires’’; and

(ii) by striking ‘‘; or’’ and inserting ‘‘; or (B) any

security futures product on the security; or’’;

114 STAT. 2763A–426 PUBLIC LAW 106–554—APPENDIX E

(B) in paragraph (2)—

(i) by inserting ‘‘(A)’’ after ‘‘interest in any’’; and

(ii) by striking ‘‘; or’’ and inserting ‘‘; or (B) such

security futures product; or’’; and

(C) in paragraph (3)—

(i) by inserting ‘‘(A)’’ after ‘‘interest in any’’; and

(ii) by inserting ‘‘; or (B) such security futures

product’’ after ‘‘privilege’’.

(2) MANIPULATION IN OPTIONS AND OTHER DERIVATIVE PRODUCTS.—Section 9(g) of the Securities Exchange Act of 1934

(15 U.S.C. 78i(g)) is amended—

(A) by inserting ‘‘(1)’’ after ‘‘(g)’’;

(B) by inserting ‘‘other than a security futures product’’

after ‘‘future delivery’’; and

(C) by adding at the end the following:

‘‘(2) Notwithstanding the Commodity Exchange Act, the

Commission shall have the authority to regulate the trading of

any security futures product to the extent provided in the securities

laws.’’.

(3) LIABILITY OF CONTROLLING PERSONS AND PERSONS WHO

AID AND ABET VIOLATIONS.—Section 20(d) of the Securities

Exchange Act of 1934 (15 U.S.C. 78t(d)) is amended by striking

‘‘or privilege’’ and inserting ‘‘, privilege, or security futures

product’’.

(4) LIABILITY TO CONTEMPORANEOUS TRADERS FOR INSIDER

TRADING.—Section 21A(a)(1) of the Securities Exchange Act

of 1934 (15 U.S.C. 78u–1(a)(1)) is amended by striking

‘‘standardized options, the Commission—’’ and inserting

‘‘standardized options or security futures products, the Commission—’’.

(5) ENFORCEMENT CONSULTATION.—Section 21 of the Securities Exchange Act of 1934 (15 U.S.C. 78u) is amended by

adding at the end the following:

‘‘(i) INFORMATION TO CFTC.—The Commission shall provide

the Commodity Futures Trading Commission with notice of the

commencement of any proceeding and a copy of any order entered

by the Commission against any broker or dealer registered pursuant

to section 15(b)(11), any exchange registered pursuant to section

6(g), or any national securities association registered pursuant to

section 15A(k).’’.

SEC. 206. SPECIAL PROVISIONS FOR THE TRADING OF SECURITY

FUTURES PRODUCTS.

(a) LISTING STANDARDS AND CONDITIONS FOR TRADING.—Section

6 of the Securities Exchange Act of 1934 (15 U.S.C. 78f ) is amended

by inserting after subsection (g), as added by section 202, the

following:

‘‘(h) TRADING IN SECURITY FUTURES PRODUCTS.—

‘‘(1) TRADING ON EXCHANGE OR ASSOCIATION REQUIRED.—

It shall be unlawful for any person to effect transactions in

security futures products that are not listed on a national

securities exchange or a national securities association registered pursuant to section 15A(a).

‘‘(2) LISTING STANDARDS REQUIRED.—Except as otherwise

provided in paragraph (7), a national securities exchange or

a national securities association registered pursuant to section

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–427

15A(a) may trade only security futures products that (A) conform with listing standards that such exchange or association

files with the Commission under section 19(b) and (B) meet

the criteria specified in section 2(a)(1)(D)(i) of the Commodity

Exchange Act.

‘‘(3) REQUIREMENTS FOR LISTING STANDARDS AND CONDITIONS FOR TRADING.—Such listing standards shall—

‘‘(A) except as otherwise provided in a rule, regulation,

or order issued pursuant to paragraph (4), require that

any security underlying the security future, including each

component security of a narrow-based security index, be

registered pursuant to section 12 of this title;

‘‘(B) require that if the security futures product is

not cash settled, the market on which the security futures

product is traded have arrangements in place with a registered clearing agency for the payment and delivery of

the securities underlying the security futures product;

‘‘(C) be no less restrictive than comparable listing

standards for options traded on a national securities

exchange or national securities association registered

pursuant to section 15A(a) of this title;

‘‘(D) except as otherwise provided in a rule, regulation,

or order issued pursuant to paragraph (4), require that

the security future be based upon common stock and such

other equity securities as the Commission and the

Commodity Futures Trading Commission jointly determine

appropriate;

‘‘(E) require that the security futures product is cleared

by a clearing agency that has in place provisions for linked

and coordinated clearing with other clearing agencies that

clear security futures products, which permits the security

futures product to be purchased on one market and offset

on another market that trades such product;

‘‘(F) require that only a broker or dealer subject to

suitability rules comparable to those of a national securities

association registered pursuant to section 15A(a) effect

transactions in the security futures product;

‘‘(G) require that the security futures product be subject

to the prohibition against dual trading in section 4j of

the Commodity Exchange Act (7 U.S.C. 6j) and the rules

and regulations thereunder or the provisions of section

11(a) of this title and the rules and regulations thereunder,

except to the extent otherwise permitted under this title

and the rules and regulations thereunder;

‘‘(H) require that trading in the security futures product not be readily susceptible to manipulation of the price

of such security futures product, nor to causing or being

used in the manipulation of the price of any underlying

security, option on such security, or option on a group

or index including such securities;

‘‘(I) require that procedures be in place for coordinated

surveillance among the market on which the security

futures product is traded, any market on which any security

underlying the security futures product is traded, and other

markets on which any related security is traded to detect

manipulation and insider trading;

114 STAT. 2763A–428 PUBLIC LAW 106–554—APPENDIX E

‘‘(J) require that the market on which the security

futures product is traded has in place audit trails necessary

or appropriate to facilitate the coordinated surveillance

required in subparagraph (I);

‘‘(K) require that the market on which the security

futures product is traded has in place procedures to coordinate trading halts between such market and any market

on which any security underlying the security futures product is traded and other markets on which any related

security is traded; and

‘‘(L) require that the margin requirements for a security futures product comply with the regulations prescribed

pursuant to section 7(c)(2)(B), except that nothing in this

subparagraph shall be construed to prevent a national

securities exchange or national securities association from

requiring higher margin levels for a security futures product when it deems such action to be necessary or appropriate.

‘‘(4) AUTHORITY TO MODIFY CERTAIN LISTING STANDARD

REQUIREMENTS.—

‘‘(A) AUTHORITY TO MODIFY.—The Commission and the

Commodity Futures Trading Commission, by rule, regulation, or order, may jointly modify the listing standard

requirements specified in subparagraph (A) or (D) of paragraph (3) to the extent such modification fosters the

development of fair and orderly markets in security futures

products, is necessary or appropriate in the public interest,

and is consistent with the protection of investors.

‘‘(B) AUTHORITY TO GRANT EXEMPTIONS.—The Commission and the Commodity Futures Trading Commission, by

order, may jointly exempt any person from compliance

with the listing standard requirement specified in subparagraph (E) of paragraph (3) to the extent such exemption

fosters the development of fair and orderly markets in

security futures products, is necessary or appropriate in

the public interest, and is consistent with the protection

of investors.

‘‘(5) REQUIREMENTS FOR OTHER PERSONS TRADING SECURITY

FUTURE PRODUCTS.—It shall be unlawful for any person (other

than a national securities exchange or a national securities

association registered pursuant to section 15A(a)) to constitute,

maintain, or provide a marketplace or facilities for bringing

together purchasers and sellers of security future products or

to otherwise perform with respect to security future products

the functions commonly performed by a stock exchange as

that term is generally understood, unless a national securities

association registered pursuant to section 15A(a) or a national

securities exchange of which such person is a member—

‘‘(A) has in place procedures for coordinated surveillance among such person, the market trading the securities

underlying the security future products, and other markets

trading related securities to detect manipulation and

insider trading;

‘‘(B) has rules to require audit trails necessary or

appropriate to facilitate the coordinated surveillance

required in subparagraph (A); and

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–429

‘‘(C) has rules to require such person to coordinate

trading halts with markets trading the securities underlying the security future products and other markets trading

related securities.

‘‘(6) DEFERRAL OF OPTIONS ON SECURITY FUTURES TRAD- ING.—No person shall offer to enter into, enter into, or confirm

the execution of any put, call, straddle, option, or privilege

on a security future, except that, after 3 years after the date

of the enactment of this subsection, the Commission and the

Commodity Futures Trading Commission may by order jointly

determine to permit trading of puts, calls, straddles, options,

or privileges on any security future authorized to be traded

under the provisions of this Act and the Commodity Exchange

Act. ‘‘(7) DEFERRAL OF LINKED AND COORDINATED CLEARING.— ‘‘(A) Notwithstanding paragraph (2), until the compliance date, a national securities exchange or national securities association registered pursuant to section 15A(a) may

trade a security futures product that does not— ‘‘(i) conform with any listing standard promulgated

to meet the requirement specified in subparagraph

(E) of paragraph (3); or ‘‘(ii) meet the criterion specified in section

2(a)(1)(D)(i)(IV) of the Commodity Exchange Act.

‘‘(B) The Commission and the Commodity Futures

Trading Commission shall jointly publish in the Federal

Register a notice of the compliance date no later than

165 days before the compliance date.

‘‘(C) For purposes of this paragraph, the term ‘compliance date’ means the later of—

‘‘(i) 180 days after the end of the first full calendar

month period in which the average aggregate comparable share volume for all security futures products

based on single equity securities traded on all national

securities exchanges, any national securities associations registered pursuant to section 15A(a), and all

other persons equals or exceeds 10 percent of the average aggregate comparable share volume of options on

single equity securities traded on all national securities

exchanges and any national securities associations registered pursuant to section 15A(a); or

‘‘(ii) 2 years after the date on which trading in

any security futures product commences under this

title.’’.

(b) MARGIN.—Section 7 of the Securities Exchange Act of 1934

(15 U.S.C. 78g) is amended—

(1) in subsection (a), by inserting ‘‘or a security futures

product’’ after ‘‘exempted security’’;

(2) in subsection (c)(1)(A), by inserting ‘‘except as provided

in paragraph (2),’’ after ‘‘security),’’;

(3) by redesignating paragraph (2) of subsection (c) as

paragraph (3) of such subsection; and

(4) by inserting after paragraph (1) of such subsection

the following:

‘‘(2) MARGIN REGULATIONS.— ‘‘(A) COMPLIANCE WITH MARGIN RULES REQUIRED.—It

shall be unlawful for any broker, dealer, or member of

114 STAT. 2763A–430 PUBLIC LAW 106–554—APPENDIX E

a national securities exchange to, directly or indirectly,

extend or maintain credit to or for, or collect margin from

any customer on, any security futures product unless such

activities comply with the regulations—

‘‘(i) which the Board shall prescribe pursuant to

subparagraph (B); or

‘‘(ii) if the Board determines to delegate the authority to prescribe such regulations, which the Commission and the Commodity Futures Trading Commission

shall jointly prescribe pursuant to subparagraph (B).

If the Board delegates the authority to prescribe such regulations under clause (ii) and the Commission and the

Commodity Futures Trading Commission have not jointly

prescribed such regulations within a reasonable period of

time after the date of such delegation, the Board shall

prescribe such regulations pursuant to subparagraph (B).

‘‘(B) CRITERIA FOR ISSUANCE OF RULES.—The Board

shall prescribe, or, if the authority is delegated pursuant

to subparagraph (A)(ii), the Commission and the Commodity Futures Trading Commission shall jointly prescribe,

such regulations to establish margin requirements, including the establishment of levels of margin (initial and

maintenance) for security futures products under such

terms, and at such levels, as the Board deems appropriate,

or as the Commission and the Commodity Futures Trading

Commission jointly deem appropriate—

‘‘(i) to preserve the financial integrity of markets

trading security futures products;

‘‘(ii) to prevent systemic risk;

‘‘(iii) to require that—

‘‘(I) the margin requirements for a security

future product be consistent with the margin

requirements for comparable option contracts

traded on any exchange registered pursuant to

section 6(a) of this title; and ‘‘(II) initial and maintenance margin levels for

a security future product not be lower than the

lowest level of margin, exclusive of premium,

required for any comparable option contract traded

on any exchange registered pursuant to section

6(a) of this title, other than an option on a security

future;

except that nothing in this subparagraph shall be construed to prevent a national securities exchange or

national securities association from requiring higher

margin levels for a security future product when it

deems such action to be necessary or appropriate; and

‘‘(iv) to ensure that the margin requirements (other

than levels of margin), including the type, form, and

use of collateral for security futures products, are and

remain consistent with the requirements established

by the Board, pursuant to subparagraphs (A) and (B)

of paragraph (1).’’.

(c) INCORPORATION OF SECURITY FUTURES PRODUCTS INTO THE

NATIONAL MARKET SYSTEM.—Section 11A of the Securities

Exchange Act of 1934 (15 U.S.C. 78k–1) is amended by adding

at the end the following:

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–431

‘‘(e) NATIONAL MARKETS SYSTEM FOR SECURITY FUTURES PRODUCTS.—

‘‘(1) CONSULTATION AND COOPERATION REQUIRED.—With

respect to security futures products, the Commission and the

Commodity Futures Trading Commission shall consult and

cooperate so that, to the maximum extent practicable, their

respective regulatory responsibilities may be fulfilled and the

rules and regulations applicable to security futures products

may foster a national market system for security futures products if the Commission and the Commodity Futures Trading

Commission jointly determine that such a system would be

consistent with the congressional findings in subsection (a)(1).

In accordance with this objective, the Commission shall, at

least 15 days prior to the issuance for public comment of

any proposed rule or regulation under this section concerning

security futures products, consult and request the views of

the Commodity Futures Trading Commission.

‘‘(2) APPLICATION OF RULES BY ORDER OF CFTC.—No rule

adopted pursuant to this section shall be applied to any person

with respect to the trading of security futures products on

an exchange that is registered under section 6(g) unless the

Commodity Futures Trading Commission has issued an order

directing that such rule is applicable to such persons.’’.

(d) INCORPORATION OF SECURITY FUTURES PRODUCTS INTO THE

NATIONAL SYSTEM FOR CLEARANCE AND SETTLEMENT.—Section

17A(b) of the Securities Exchange Act of 1934 (15 U.S.C. 78q–

1(b)) is amended by adding at the end the following:

‘‘(7)(A) A clearing agency that is regulated directly or indirectly

by the Commodity Futures Trading Commission through its association with a designated contract market for security futures products

that is a national securities exchange registered pursuant to section

6(g), and that would be required to register pursuant to paragraph

(1) of this subsection only because it performs the functions of

a clearing agency with respect to security futures products effected

pursuant to the rules of the designated contract market with which

such agency is associated, is exempted from the provisions of this

section and the rules and regulations thereunder, except that if

such a clearing agency performs the functions of a clearing agency

with respect to a security futures product that is not cash settled,

it must have arrangements in place with a registered clearing

agency to effect the payment and delivery of the securities underlying the security futures product.

‘‘(B) Any clearing agency that performs the functions of a clearing agency with respect to security futures products must coordinate

with and develop fair and reasonable links with any and all other

clearing agencies that perform the functions of a clearing agency

with respect to security futures products, in order to permit, as

of the compliance date (as defined in section 6(h)(6)(C)), security

futures products to be purchased on one market and offset on

another market that trades such products.’’.

(e) MARKET EMERGENCY POWERS AND CIRCUIT BREAKERS.—

Section 12(k) of the Securities Exchange Act of 1934 (15 U.S.C.

78l(k)) is amended—

(1) in paragraph (1), by adding at the end the following:

‘‘If the actions described in subparagraph (A) or (B) involve

a security futures product, the Commission shall consult with

114 STAT. 2763A–432 PUBLIC LAW 106–554—APPENDIX E

and consider the views of the Commodity Futures Trading

Commission.’’; and

(2) in paragraph (2)(B), by inserting after the first sentence

the following: ‘‘If the actions described in subparagraph (A)

involve a security futures product, the Commission shall consult

with and consider the views of the Commodity Futures Trading

Commission.’’.

(f ) TRANSACTION FEES.—Section 31 of the Securities Exchange

Act of 1934 (15 U.S.C. 78ee) is amended— (1) in subsection (a), by inserting ‘‘and assessments’’ after ‘‘fees’’;

(2) in subsections (b), (c), and (d)(1), by striking ‘‘and other

evidences of indebtedness’’ and inserting ‘‘other evidences of

indebtedness, and security futures products’’;

(3) in subsection (f ), by inserting ‘‘or assessment’’ after ‘‘fee’’;

(4) in subsection (g), by inserting ‘‘and assessment’’ after ‘‘fee’’;

(5) by redesignating subsections (e), (f ), and (g) as subsections (f ), (g), and (h), respectively; and

(6) by inserting after subsection (d) the following new subsection:

‘‘(e) ASSESSMENTS ON SECURITY FUTURES TRANSACTIONS.—Each

national securities exchange and national securities association

shall pay to the Commission an assessment equal to $0.02 for

each round turn transaction (treated as including one purchase

and one sale of a contract of sale for future delivery) on a security

future traded on such national securities exchange or by or through

any member of such association otherwise than on a national securities exchange, except that for fiscal year 2007 or any succeeding

fiscal year such assessment shall be equal to $0.0075 for each

such transaction. Assessments collected pursuant to this subsection

shall be deposited and collected as general revenue of the Treasury.’’.

(g) EXEMPTION FROM SHORT SALE PROVISIONS.—Section 10(a)

of the Securities Exchange Act of 1934 (15 U.S.C 78j(a)) is

amended—

(1) by inserting ‘‘(1)’’ after ‘‘(a)’’; and

(2) by adding at the end the following:

‘‘(2) Paragraph (1) of this subsection shall not apply to security

futures products.’’.

(h) RULEMAKING AUTHORITY TO ADDRESS DUPLICATIVE REGULATION OF DUAL REGISTRANTS.—Section 15(c)(3) of the Securities

Exchange Act of 1934 (15 U.S.C. 78o(c)(3)) is amended—

(1) by inserting ‘‘(A)’’ after ‘‘(3)’’; and

(2) by adding at the end the following:

‘‘(B) Consistent with this title, the Commission, in consultation

with the Commodity Futures Trading Commission, shall issue such

rules, regulations, or orders as are necessary to avoid duplicative

or conflicting regulations applicable to any broker or dealer registered with the Commission pursuant to section 15(b) (except paragraph (11) thereof ), that is also registered with the Commodity

Futures Trading Commission pursuant to section 4f(a) of the

Commodity Exchange Act (except paragraph (2) thereof ), with

respect to the application of: (i) the provisions of section 8, section

15(c)(3), and section 17 of this title and the rules and regulations

thereunder related to the treatment of customer funds, securities,

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–433

or property, maintenance of books and records, financial reporting,

or other financial responsibility rules, involving security futures

products; and (ii) similar provisions of the Commodity Exchange

Act and rules and regulations thereunder involving security futures

products.’’.

(i) OBLIGATION TO ADDRESS DUPLICATIVE REGULATION OF DUAL

REGISTRANTS.—Section 6 of the Securities Exchange Act of 1934

(15 U.S.C. 78f ) is amended by inserting after subsection (h), as

added by subsection (a) of this section, the following:

‘‘(i) Consistent with this title, each national securities exchange

registered pursuant to subsection (a) of this section shall issue

such rules as are necessary to avoid duplicative or conflicting rules

applicable to any broker or dealer registered with the Commission

pursuant to section 15(b) (except paragraph (11) thereof ), that

is also registered with the Commodity Futures Trading Commission

pursuant to section 4f(a) of the Commodity Exchange Act (except

paragraph (2) thereof ), with respect to the application of—

(1) rules of such national securities exchange of the type

specified in section 15(c)(3)(B) involving security futures products; and

(2) similar rules of national securities exchanges registered

pursuant to section 6(g) and national securities associations

registered pursuant to section 15A(k) involving security futures

products.’’.

( j) OBLIGATION TO ADDRESS DUPLICATIVE REGULATION OF DUAL

REGISTRANTS.—Section 15A of the Securities Exchange Act of 1934

(15 U.S.C. 78o–3) is amended by inserting after subsection (k),

as added by section 203, the following:

‘‘(l) Consistent with this title, each national securities association registered pursuant to subsection (a) of this section shall issue

such rules as are necessary to avoid duplicative or conflicting rules

applicable to any broker or dealer registered with the Commission

pursuant to section 15(b) (except paragraph (11) thereof ), that

is also registered with the Commodity Futures Trading Commission

pursuant to section 4f(a) of the Commodity Exchange Act (except

paragraph (2) thereof ), with respect to the application of—

‘‘(1) rules of such national securities association of the

type specified in section 15(c)(3)(B) involving security futures

products; and

‘‘(2) similar rules of national securities associations registered pursuant to subsection (k) of this section and national

securities exchanges registered pursuant to section 6(g) involving security futures products.’’.

(k) OBLIGATION TO PUT IN PLACE PROCEDURES AND ADOPT

RULES.—

(1) NATIONAL SECURITIES ASSOCIATIONS.—Section 15A of

the Securities Exchange Act of 1934 (15 U.S.C. 78o–3) is amended by inserting after subsection (l), as added by subsection

( j) of this section, the following new subsection:

‘‘(m) PROCEDURES AND RULES FOR SECURITY FUTURE PRODUCTS.—A national securities association registered pursuant to subsection (a) shall, not later than 8 months after the date of the

enactment of the Commodity Futures Modernization Act of 2000,

implement the procedures specified in section 6(h)(5)(A) of this

title and adopt the rules specified in subparagraphs (B) and (C)

of section 6(h)(5) of this title.’’.

114 STAT. 2763A–434 PUBLIC LAW 106–554—APPENDIX E

(2) NATIONAL SECURITIES EXCHANGES.—Section 6 of the

Securities Exchange Act of 1934 (15 U.S.C. 78f ) is amended

by inserting after subsection (i), as added by subsection (i)

of this section, the following new subsection:

‘‘( j) PROCEDURES AND RULES FOR SECURITY FUTURE PROD- UCTS.—A national securities exchange registered pursuant to subsection (a) shall implement the procedures specified in section

6(h)(5)(A) of this title and adopt the rules specified in subparagraphs

(B) and (C) of section 6(h)(5) of this title not later than 8 months

after the date of receipt of a request from an alternative trading

system for such implementation and rules.’’. (l) OBLIGATION TO ADDRESS SECURITY FUTURES PRODUCTS

TRADED ON FOREIGN EXCHANGES.—Section 6 of the Securities

Exchange Act of 1934 (15 U.S.C. 78f ) is amended by adding after

subsection ( j), as added by subsection (k) of this section, the following: ‘‘(k)(1) To the extent necessary or appropriate in the public

interest, to promote fair competition, and consistent with the promotion of market efficiency, innovation, and expansion of investment opportunities, the protection of investors, and the maintenance

of fair and orderly markets, the Commission and the Commodity

Futures Trading Commission shall jointly issue such rules, regulations, or orders as are necessary and appropriate to permit the

offer and sale of a security futures product traded on or subject

to the rules of a foreign board of trade to United States persons. ‘‘(2) The rules, regulations, or orders adopted under paragraph

(1) shall take into account, as appropriate, the nature and size

of the markets that the securities underlying the security futures

product reflect.’’.

SEC. 207. CLEARANCE AND SETTLEMENT.

Section 17A(b) of the Securities Exchange Act of 1934 (15

U.S.C. 78q–1(b)) is amended— (1) in paragraph (3)(A), by inserting ‘‘and derivative agreements, contracts, and transactions’’ after ‘‘prompt and accurate

clearance and settlement of securities transactions’’;

(2) in paragraph (3)(F), by inserting ‘‘and, to the extent

applicable, derivative agreements, contracts, and transactions’’ after ‘‘designed to promote the prompt and accurate clearance

and settlement of securities transactions’’; and

(3) by inserting after paragraph (7), as added by section

206(d), the following:

‘‘(8) A registered clearing agency shall be permitted to provide

facilities for the clearance and settlement of any derivative agreements, contracts, or transactions that are excluded from the

Commodity Exchange Act, subject to the requirements of this section and to such rules and regulations as the Commission may

prescribe as necessary or appropriate in the public interest, for

the protection of investors, or otherwise in furtherance of the purposes of this title.’’.

SEC. 208. AMENDMENTS RELATING TO REGISTRATION AND DISCLOSURE ISSUES UNDER THE SECURITIES ACT OF 1933 AND

THE SECURITIES EXCHANGE ACT OF 1934.

(a) AMENDMENTS TO THE SECURITIES ACT OF 1933.—

(1) TREATMENT OF SECURITY FUTURES PRODUCTS.—Section

2(a) of the Securities Act of 1933 (15 U.S.C. 77b(a)) is

amended—

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–435

(A) in paragraph (1), by inserting ‘‘security future,’’

after ‘‘treasury stock,’’;

(B) in paragraph (3), by adding at the end the following:

‘‘Any offer or sale of a security futures product by or on

behalf of the issuer of the securities underlying the security

futures product, an affiliate of the issuer, or an underwriter, shall constitute a contract for sale of, sale of, offer

for sale, or offer to sell the underlying securities.’’; and

(C) by adding at the end the following:

‘‘(16) The terms ‘security future’, ‘narrow-based security

index’, and ‘security futures product’ have the same meanings

as provided in section 3(a)(55) of the Securities Exchange Act

of 1934.’’.

(2) EXEMPTION FROM REGISTRATION.—Section 3(a) of the

Securities Act of 1933 (15 U.S.C. 77c(a)) is amended by adding

at the end the following:

‘‘(14) Any security futures product that is—

‘‘(A) cleared by a clearing agency registered under section 17A of the Securities Exchange Act of 1934 or exempt

from registration under subsection (b)(7) of such section

17A; and

‘‘(B) traded on a national securities exchange or a

national securities association registered pursuant to section 15A(a) of the Securities Exchange Act of 1934.’’.

(3) CONFORMING AMENDMENT.—Section 12(a)(2) of the Securities Act of 1933 (15 U.S.C. 77l(a)(2)) is amended by striking

‘‘paragraph (2)’’ and inserting ‘‘paragraphs (2) and (14)’’.

(b) AMENDMENTS TO THE SECURITIES EXCHANGE ACT OF 1934.—

(1) EXEMPTION FROM REGISTRATION.—Section 12(a) of the

Securities Exchange Act of 1934 (15 U.S.C. 78l(a)) is amended

by adding at the end the following: ‘‘The provisions of this

subsection shall not apply in respect of a security futures product traded on a national securities exchange.’’.

(2) EXEMPTIONS FROM REPORTING REQUIREMENT.—Section

12(g)(5) of the Securities Exchange Act of 1934 (15 U.S.C.

78l(g)(5)) is amended by adding at the end the following: ‘‘For

purposes of this subsection, a security futures product shall

not be considered a class of equity security of the issuer of

the securities underlying the security futures product.’’.

(3) TRANSACTIONS BY CORPORATE INSIDERS.—Section 16 of

the Securities Exchange Act of 1934 (15 U.S.C. 78p) is amended

by adding at the end the following:

‘‘(f ) TREATMENT OF TRANSACTIONS IN SECURITY FUTURES PRODUCTS.—The provisions of this section shall apply to ownership of

and transactions in security futures products.’’.

SEC. 209. AMENDMENTS TO THE INVESTMENT COMPANY ACT OF 1940

AND THE INVESTMENT ADVISERS ACT OF 1940.

(a) DEFINITIONS UNDER THE INVESTMENT COMPANY ACT OF

1940 AND THE INVESTMENT ADVISERS ACT OF 1940.—

(1) Section 2(a)(36) of the Investment Company Act of

1940 (15 U.S.C. 80a–2(a)(36)) is amended by inserting ‘‘security

future,’’ after ‘‘treasury stock,’’.

(2) Section 202(a)(18) of the Investment Advisers Act of

1940 (15 U.S.C. 80b–2(a)(18)) is amended by inserting ‘‘security

future,’’ after ‘‘treasury stock,’’.

114 STAT. 2763A–436 PUBLIC LAW 106–554—APPENDIX E

(3) Section 2(a) of the Investment Company Act of 1940

(15 U.S.C. 80a–2(a)) is amended by adding at the end the

following: ‘‘(52) The terms ‘security future’ and ‘narrow-based security

index’ have the same meanings as provided in section 3(a)(55)

of the Securities Exchange Act of 1934.’’. (4) Section 202(a) of the Investment Advisers Act of 1940

(15 U.S.C. 80b–2(a)) is amended by adding at the end the

following: ‘‘(27) The terms ‘security future’ and ‘narrow-based security

index’ have the same meanings as provided in section 3(a)(55)

of the Securities Exchange Act of 1934.’’. (b) OTHER PROVISION.—Section 203(b) of the Investment Advisers Act of 1940 (15 U.S.C. 80b–3(b)) is amended— (1) by striking ‘‘or’’ at the end of paragraph (4);

(2) by striking the period at the end of paragraph (5)

and inserting ‘‘; or’’; and

(3) by adding at the end the following:

‘‘(6) any investment adviser that is registered with the

Commodity Futures Trading Commission as a commodity trading advisor whose business does not consist primarily of acting

as an investment adviser, as defined in section 202(a)(11) of

this title, and that does not act as an investment adviser

to—

‘‘(A) an investment company registered under title I

of this Act; or

‘‘(B) a company which has elected to be a business

development company pursuant to section 54 of title I

of this Act and has not withdrawn its election.’’.

SEC. 210. PREEMPTION OF STATE LAWS.

Section 28(a) of the Securities Exchange Act of 1934 (15 U.S.C.

78bb(a)) is amended—

(1) in the last sentence—

(A) by inserting ‘‘subject to this title’’ after ‘‘privilege,

or other security’’; and

(B) by striking ‘‘any such instrument, if such

instrument is traded pursuant to rules and regulations

of a self-regulatory organization that are filed with the

Commission pursuant to section 19(b) of this Act’’ and

inserting ‘‘any such security’’; and

(2) by adding at the end the following new sentence: ‘‘No

provision of State law regarding the offer, sale, or distribution

of securities shall apply to any transaction in a security futures

product, except that this sentence shall not be construed as

limiting any State antifraud law of general applicability.’’.

Subtitle B—Amendments to the

Commodity Exchange Act

SEC. 251. JURISDICTION OF SECURITIES AND EXCHANGE COMMISSION;

OTHER PROVISIONS.

(a) JURISDICTION OF SECURITIES AND EXCHANGE COMMISSION.—

(1) Section 2(a)(1)(C) of the Commodity Exchange Act (7

U.S.C. 2a) (as redesignated by section 34(a)(2)(C)) is amended—

(A) in clause (ii)—

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–437

(i) by inserting ‘‘or register a derivatives transaction execution facility that trades or executes,’’ after ‘‘contract market in,’’;

(ii) by inserting after ‘‘contracts) for future delivery’’ the following: ‘‘, and no derivatives transaction

execution facility shall trade or execute such contracts

of sale (or options on such contracts) for future delivery,’’;

(iii) by striking ‘‘making such application demonstrates and the Commission expressly finds that the

specific contract (or option on such contract) with

respect to which the application has been made meets’’

and inserting ‘‘or the derivatives transaction execution

facility, and the applicable contract, meet’’; and

(iv) by striking subclause (III) of clause (ii) and

inserting the following:

‘‘(III) Such group or index of securities shall not constitute a narrow-based security index.’’;

(B) by striking clause (iii);

(C) by striking clause (iv) and inserting the following:

‘‘(iii) If, in its discretion, the Commission determines that

a stock index futures contract, notwithstanding its conformance

with the requirements in clause (ii) of this subparagraph, can

reasonably be used as a surrogate for trading a security (including a security futures product), it may, by order, require such

contract and any option thereon be traded and regulated as

security futures products as defined in section 3(a)(56) of the

Securities Exchange Act of 1934 and section 1a of this Act

subject to all rules and regulations applicable to security futures

products under this Act and the securities laws as defined

in section 3(a)(47) of the Securities Exchange Act of 1934.’’;

and

(D) by redesignating clause (v) as clause (iv).

(2) Section 2(a)(1) of the Commodity Exchange Act (7 U.S.C.

2, 2a, 4) is amended by adding at the end the following:

‘‘(D)(i) Notwithstanding any other provision of this Act, the

Securities and Exchange Commission shall have jurisdiction and

authority over security futures as defined in section 3(a)(55) of

the Securities Exchange Act of 1934, section 2(a)(16) of the Securities Act of 1933, section 2(a)(52) of the Investment Company Act

of 1940, and section 202(a)(27) of the Investment Advisers Act

of 1940, options on security futures, and persons effecting transactions in security futures and options thereon, and this Act shall

apply to and the Commission shall have jurisdiction with respect

to accounts, agreements (including any transaction which is of

the character of, or is commonly known to the trade as, an ‘option’,

‘privilege’, ‘indemnity’, ‘bid’, ‘offer’, ‘put’, ‘call’, ‘advance guaranty’,

or ‘decline guaranty’), contracts, and transactions involving, and

may designate a board of trade as a contract market in, or register

a derivatives transaction execution facility that trades or executes,

a security futures product as defined in section 1a of this Act:

Provided, however, That, except as provided in clause (vi) of this

subparagraph, no board of trade shall be designated as a contract

market with respect to, or registered as a derivatives transaction

execution facility for, any such contracts of sale for future delivery

unless the board of trade and the applicable contract meet the

following criteria:

114 STAT. 2763A–438 PUBLIC LAW 106–554—APPENDIX E

‘‘(I) Except as otherwise provided in a rule, regulation,

or order issued pursuant to clause (v) of this subparagraph,

any security underlying the security future, including each

component security of a narrow-based security index, is registered pursuant to section 12 of the Securities Exchange Act

of 1934.

‘‘(II) If the security futures product is not cash settled,

the board of trade on which the security futures product is

traded has arrangements in place with a clearing agency registered pursuant to section 17A of the Securities Exchange

Act of 1934 for the payment and delivery of the securities

underlying the security futures product.

‘‘(III) Except as otherwise provided in a rule, regulation,

or order issued pursuant to clause (v) of this subparagraph,

the security future is based upon common stock and such

other equity securities as the Commission and the Securities

and Exchange Commission jointly determine appropriate.

‘‘(IV) The security futures product is cleared by a clearing

agency that has in place provisions for linked and coordinated

clearing with other clearing agencies that clear security futures

products, which permits the security futures product to be

purchased on a designated contract market, registered derivatives transaction execution facility, national securities exchange

registered under section 6(a) of the Securities Exchange Act

of 1934, or national securities association registered pursuant

to section 15A(a) of the Securities Exchange Act of 1934 and

offset on another designated contract market, registered derivatives transaction execution facility, national securities exchange

registered under section 6(a) of the Securities Exchange Act

of 1934, or national securities association registered pursuant

to section 15A(a) of the Securities Exchange Act of 1934.

‘‘(V) Only futures commission merchants, introducing brokers, commodity trading advisors, commodity pool operators

or associated persons subject to suitability rules comparable

to those of a national securities association registered pursuant

to section 15A(a) of the Securities Exchange Act of 1934 solicit,

accept any order for, or otherwise deal in any transaction

in or in connection with the security futures product.

‘‘(VI) The security futures product is subject to a prohibition

against dual trading in section 4j of this Act and the rules

and regulations thereunder or the provisions of section 11(a)

of the Securities Exchange Act of 1934 and the rules and

regulations thereunder, except to the extent otherwise permitted under the Securities Exchange Act of 1934 and the

rules and regulations thereunder.

‘‘(VII) Trading in the security futures product is not readily

susceptible to manipulation of the price of such security futures

product, nor to causing or being used in the manipulation

of the price of any underlying security, option on such security,

or option on a group or index including such securities;

‘‘(VIII) The board of trade on which the security futures

product is traded has procedures in place for coordinated

surveillance among such board of trade, any market on which

any security underlying the security futures product is traded,

and other markets on which any related security is traded

to detect manipulation and insider trading, except that, if the

board of trade is an alternative trading system, a national

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–439

securities association registered pursuant to section 15A(a) of

the Securities Exchange Act of 1934 or national securities

exchange registered pursuant to section 6(a) of the Securities

Exchange Act of 1934 of which such alternative trading system

is a member has in place such procedures.

‘‘(IX) The board of trade on which the security futures

product is traded has in place audit trails necessary or appropriate to facilitate the coordinated surveillance required in subclause (VIII), except that, if the board of trade is an alternative

trading system, a national securities association registered

pursuant to section 15A(a) of the Securities Exchange Act of

1934 or national securities exchange registered pursuant to

section 6(a) of the Securities Exchange Act of 1934 of which

such alternative trading system is a member has rules to

require such audit trails.

‘‘(X) The board of trade on which the security futures

product is traded has in place procedures to coordinate trading

halts between such board of trade and markets on which any

security underlying the security futures product is traded and

other markets on which any related security is traded, except

that, if the board of trade is an alternative trading system,

a national securities association registered pursuant to section

15A(a) of the Securities Exchange Act of 1934 or national

securities exchange registered pursuant to section 6(a) of the

Securities Exchange Act of 1934 of which such alternative

trading system is a member has rules to require such coordinated trading halts.

‘‘(XI) The margin requirements for a security futures product comply with the regulations prescribed pursuant to section

7(c)(2)(B) of the Securities Exchange Act of 1934, except that

nothing in this subclause shall be construed to prevent a board

of trade from requiring higher margin levels for a security

futures product when it deems such action to be necessary

or appropriate.

‘‘(ii) It shall be unlawful for any person to offer, to enter

into, to execute, to confirm the execution of, or to conduct any

office or business anywhere in the United States, its territories

or possessions, for the purpose of soliciting, or accepting any order

for, or otherwise dealing in, any transaction in, or in connection

with, a security futures product unless—

‘‘(I) the transaction is conducted on or subject to the rules

of a board of trade that—

‘‘(aa) has been designated by the Commission as a

contract market in such security futures product; or

‘‘(bb) is a registered derivatives transaction execution

facility for the security futures product that has provided

a certification with respect to the security futures product

pursuant to clause (vii);

‘‘(II) the contract is executed or consummated by, through,

or with a member of the contract market or registered derivatives transaction execution facility; and

‘‘(III) the security futures product is evidenced by a record

in writing which shows the date, the parties to such security

futures product and their addresses, the property covered, and

its price, and each contract market member or registered

derivatives transaction execution facility member shall keep

114 STAT. 2763A–440 PUBLIC LAW 106–554—APPENDIX E

the record for a period of 3 years from the date of the transaction, or for a longer period if the Commission so directs,

which record shall at all times be open to the inspection of

any duly authorized representative of the Commission.

‘‘(iii)(I) Except as provided in subclause (II) but notwithstanding

any other provision of this Act, no person shall offer to enter

into, enter into, or confirm the execution of any option on a security

future.

‘‘(II) After 3 years after the date of the enactment of the

Commodity Futures Modernization Act of 2000, the Commission

and the Securities and Exchange Commission may by order jointly

determine to permit trading of options on any security future

authorized to be traded under the provisions of this Act and the

Securities Exchange Act of 1934.

‘‘(iv)(I) All relevant records of a futures commission merchant

or introducing broker registered pursuant to section 4f(a)(2), floor

broker or floor trader exempt from registration pursuant to section

4f(a)(3), associated person exempt from registration pursuant to

section 4k(6), or board of trade designated as a contract market

in a security futures product pursuant to section 5f shall be subject

to such reasonable periodic or special examinations by representatives of the Commission as the Commission deems necessary or

appropriate in the public interest, for the protection of investors,

or otherwise in furtherance of the purposes of this Act, and the

Commission, before conducting any such examination, shall give

notice to the Securities and Exchange Commission of the proposed

examination and consult with the Securities and Exchange Commission concerning the feasibility and desirability of coordinating the

examination with examinations conducted by the Securities and

Exchange Commission in order to avoid unnecessary regulatory

duplication or undue regulatory burdens for the registrant or board

of trade.

‘‘(II) The Commission shall notify the Securities and Exchange

Commission of any examination conducted of any futures commission merchant or introducing broker registered pursuant to section

4f(a)(2), floor broker or floor trader exempt from registration pursuant to section 4f(a)(3), associated person exempt from registration

pursuant to section 4k(6), or board of trade designated as a contract

market in a security futures product pursuant to section 5f, and,

upon request, furnish to the Securities and Exchange Commission

any examination report and data supplied to or prepared by the

Commission in connection with the examination.

‘‘(III) Before conducting an examination under subclause (I),

the Commission shall use the reports of examinations, unless the

information sought is unavailable in the reports, of any futures

commission merchant or introducing broker registered pursuant

to section 4f(a)(2), floor broker or floor trader exempt from registration pursuant to section 4f(a)(3), associated person exempt from

registration pursuant to section 4k(6), or board of trade designated

as a contract market in a security futures product pursuant to

section 5f that is made by the Securities and Exchange Commission,

a national securities association registered pursuant to section

15A(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78o–

3(a)), or a national securities exchange registered pursuant to section 6(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78f(a)).

‘‘(IV) Any records required under this subsection for a futures

commission merchant or introducing broker registered pursuant

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–441

to section 4f(a)(2), floor broker or floor trader exempt from registration pursuant to section 4f(a)(3), associated person exempt from

registration pursuant to section 4k(6), or board of trade designated

as a contract market in a security futures product pursuant to

section 5f, shall be limited to records with respect to accounts,

agreements, contracts, and transactions involving security futures

products.

‘‘(v)(I) The Commission and the Securities and Exchange

Commission, by rule, regulation, or order, may jointly modify the

criteria specified in subclause (I) or (III) of clause (i), including

the trading of security futures based on securities other than equity

securities, to the extent such modification fosters the development

of fair and orderly markets in security futures products, is necessary

or appropriate in the public interest, and is consistent with the

protection of investors.

‘‘(II) The Commission and the Securities and Exchange Commission, by order, may jointly exempt any person from compliance

with the criterion specified in clause (i)(IV) to the extent such

exemption fosters the development of fair and orderly markets

in security futures products, is necessary or appropriate in the

public interest, and is consistent with the protection of investors.

‘‘(vi)(I) Notwithstanding clauses (i) and (vii), until the compliance date, a board of trade shall not be required to meet the

criterion specified in clause (i)(IV).

‘‘(II) The Commission and the Securities and Exchange Commission shall jointly publish in the Federal Register a notice of the

compliance date no later than 165 days before the compliance

date.

‘‘(III) For purposes of this clause, the term ‘compliance date’

means the later of—

‘‘(aa) 180 days after the end of the first full calendar

month period in which the average aggregate comparable share

volume for all security futures products based on single equity

securities traded on all designated contract markets and registered derivatives transaction execution facilities equals or

exceeds 10 percent of the average aggregate comparable share

volume of options on single equity securities traded on all

national securities exchanges registered pursuant to section

6(a) of the Securities Exchange Act of 1934 and any national

securities associations registered pursuant to section 15A(a)

of such Act; or

‘‘(bb) 2 years after the date on which trading in any security

futures product commences under this Act.

‘‘(vii) It shall be unlawful for a board of trade to trade or

execute a security futures product unless the board of trade has

provided the Commission with a certification that the specific security futures product and the board of trade, as applicable, meet

the criteria specified in subclauses (I) through (XI) of clause (i),

except as otherwise provided in clause (vi).’’.

(b) MARGIN ON SECURITY FUTURES.—Section 2(a)(1)(C)(vi) of

the Commodity Exchange Act (7 U.S.C. 2a(vi)) (as redesignated

by section 34) is amended—

(1) by redesignating subclause (V) as subclause (VI); and

(2) by striking ‘‘(vi)(I)’’ and all that follows through subclause (IV) and inserting the following:

‘‘(v)(I) Notwithstanding any other provision of this Act,

any contract market in a stock index futures contract (or option

114 STAT. 2763A–442 PUBLIC LAW 106–554—APPENDIX E

thereon) other than a security futures product, or any derivatives transaction execution facility on which such contract or

option is traded, shall file with the Board of Governors of

the Federal Reserve System any rule establishing or changing

the levels of margin (initial and maintenance) for such stock

index futures contract (or option thereon) other than security

futures products.

‘‘(II) The Board may at any time request any contract

market or derivatives transaction execution facility to set the

margin for any stock index futures contract (or option thereon),

other than for any security futures product, at such levels

as the Board in its judgment determines are appropriate to

preserve the financial integrity of the contract market or derivatives transaction execution facility, or its clearing system, or

to prevent systemic risk. If the contract market or derivatives

transaction execution facility fails to do so within the time

specified by the Board in its request, the Board may direct

the contract market or derivatives transaction execution facility

to alter or supplement the rules of the contract market or

derivatives transaction execution facility as specified in the

request.

‘‘(III) Subject to such conditions as the Board may determine, the Board may delegate any or all of its authority,

relating to margin for any stock index futures contract (or

option thereon), other than security futures products, under

this clause to the Commission.

‘‘(IV) It shall be unlawful for any futures commission merchant to, directly or indirectly, extend or maintain credit to

or for, or collect margin from any customer on any security

futures product unless such activities comply with the regulations prescribed pursuant to section 7(c)(2)(B) of the Securities

Exchange Act of 1934.

‘‘(V) Nothing in this clause shall supersede or limit the

authority granted to the Commission in section 8a(9) to direct

a contract market or registered derivatives transaction execution facility, on finding an emergency to exist, to raise temporary margin levels on any futures contract, or option on

the contract covered by this clause, or on any security futures

product.’’.

(c) DUAL TRADING.—Section 4j of the Commodity Exchange

Act (7 U.S.C. 6j) is amended to read as follows:

‘‘SEC. 4j. RESTRICTIONS ON DUAL TRADING IN SECURITY FUTURES

PRODUCTS ON DESIGNATED CONTRACT MARKETS AND

REGISTERED DERIVATIVES TRANSACTION EXECUTION

FACILITIES.

‘‘(a) The Commission shall issue regulations to prohibit the

privilege of dual trading in security futures products on each contract market and registered derivatives transaction execution facility. The regulations issued by the Commission under this section—

‘‘(1) shall provide that the prohibition of dual trading thereunder shall take effect upon issuance of the regulations; and

‘‘(2) shall provide exceptions, as the Commission determines

appropriate, to ensure fairness and orderly trading in security

futures product markets, including—

‘‘(A) exceptions for spread transactions and the correction of trading errors;

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–443

‘‘(B) allowance for a customer to designate in writing

not less than once annually a named floor broker to execute

orders for such customer, notwithstanding the regulations

to prohibit the privilege of dual trading required under

this section; and

‘‘(C) other measures reasonably designed to accommodate unique or special characteristics of individual boards

of trade or contract markets, to address emergency or

unusual market conditions, or otherwise to further the

public interest consistent with the promotion of market

efficiency, innovation, and expansion of investment

opportunities, the protection of investors, and with the

purposes of this section.

‘‘(b) As used in this section, the term ‘dual trading’ means

the execution of customer orders by a floor broker during the

same trading session in which the floor broker executes any trade

in the same contract market or registered derivatives transaction

execution facility for—

‘‘(1) the account of such floor broker;

‘‘(2) an account for which such floor broker has trading

discretion; or

‘‘(3) an account controlled by a person with whom such

floor broker has a relationship through membership in a broker

association.

‘‘(c) As used in this section, the term ‘broker association’ shall

include two or more contract market members or registered derivatives transaction execution facility members with floor trading privileges of whom at least one is acting as a floor broker, who—

‘‘(1) engage in floor brokerage activity on behalf of the

same employer,

‘‘(2) have an employer and employee relationship which

relates to floor brokerage activity,

‘‘(3) share profits and losses associated with their brokerage

or trading activity, or

‘‘(4) regularly share a deck of orders.’’.

(d) EXEMPTION FROM REGISTRATION FOR INVESTMENT ADVISERS.—Section 4m of the Commodity Exchange Act (7 U.S.C. 6m)

is amended by adding at the end the following:

‘‘(3) Subsection (1) of this section shall not apply to any commodity trading advisor that is registered with the Securities and

Exchange Commission as an investment adviser whose business

does not consist primarily of acting as a commodity trading advisor,

as defined in section 1a(6), and that does not act as a commodity

trading advisor to any investment trust, syndicate, or similar form

of enterprise that is engaged primarily in trading in any commodity

for future delivery on or subject to the rules of any contract market

or registered derivatives transaction execution facility.’’.

(e) EXEMPTION FROM INVESTIGATIONS OF MARKETS IN UNDERLYING SECURITIES.—Section 16 of the Commodity Exchange Act (7

U.S.C. 20) is amended by adding at the end the following:

‘‘(e) This section shall not apply to investigations involving

any security underlying a security futures product.’’.

(f ) RULEMAKING AUTHORITY TO ADDRESS DUPLICATIVE REGULATION OF DUAL REGISTRANTS.—Section 4d of the Commodity

Exchange Act (7 U.S.C. 6d) is amended—

(1) by inserting ‘‘(a)’’ before the first undesignated paragraph;

114 STAT. 2763A–444 PUBLIC LAW 106–554—APPENDIX E

(2) by inserting ‘‘(b)’’ before the second undesignated paragraph; and

(3) by adding at the end the following:

‘‘(c) Consistent with this Act, the Commission, in consultation

with the Securities and Exchange Commission, shall issue such

rules, regulations, or orders as are necessary to avoid duplicative

or conflicting regulations applicable to any futures commission merchant registered with the Commission pursuant to section 4f(a)

(except paragraph (2) thereof ), that is also registered with the

Securities and Exchange Commission pursuant to section 15(b)

of the Securities Exchange Act (except paragraph (11) thereof ),

involving the application of—

‘‘(1) section 8, section 15(c)(3), and section 17 of the Securities Exchange Act of 1934 and the rules and regulations thereunder related to the treatment of customer funds, securities,

or property, maintenance of books and records, financial reporting or other financial responsibility rules (as defined in section

3(a)(40) of the Securities Exchange Act of 1934), involving security futures products; and

‘‘(2) similar provisions of this Act and the rules and regulations thereunder involving security futures products.’’.

(g) OBLIGATION TO ADDRESS DUPLICATIVE REGULATION OF DUAL

REGISTRANTS.—Section 17 of the Commodity Exchange Act (7 U.S.C.

21) is amended by adding at the end the following:

‘‘(r) Consistent with this Act, each futures association registered

under this section shall issue such rules as are necessary to avoid

duplicative or conflicting rules applicable to any futures commission

merchant registered with the Commission pursuant to section 4f(a)

of this Act (except paragraph (2) thereof ), that is also registered

with the Securities and Exchange Commission pursuant to section

15(b) of the Securities and Exchange Act of 1934 (except paragraph

(11) thereof ), with respect to the application of—

‘‘(1) rules of such futures association of the type specified

in section 4d(3) of this Act involving security futures products;

and

‘‘(2) similar rules of national securities associations registered pursuant to section 15A(a) of the Securities and

Exchange Act of 1934 involving security futures products.’’.

(h) OBLIGATION TO ADDRESS DUPLICATIVE REGULATION OF DUAL

REGISTRANTS.—Section 5c of the Commodity Exchange Act (as

added by section 114) is amended by adding at the end the following:

‘‘(f ) Consistent with this Act, each designated contract market

and registered derivatives transaction execution facility shall issue

such rules as are necessary to avoid duplicative or conflicting rules

applicable to any futures commission merchant registered with

the Commission pursuant to section 4f(a) of this Act (except paragraph (2) thereof ), that is also registered with the Securities and

Exchange Commission pursuant to section 15(b) of the Securities

Exchange Act of 1934 (except paragraph (11) thereof ) with respect

to the application of—

‘‘(1) rules of such designated contract market or registered

derivatives transaction execution facility of the type specified

in section 4d(3) of this Act involving security futures products;

and

‘‘(2) similar rules of national securities associations registered pursuant to section 15A(a) of the Securities Exchange

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–445

Act of 1934 and national securities exchanges registered pursuant to section 6(g) of such Act involving security futures products.’’. (i) OBLIGATION TO ADDRESS SECURITY FUTURES PRODUCTS

TRADED ON FOREIGN EXCHANGES.—Section 2(a)(1) of the Commodity

Exchange Act (7 U.S.C. 2, 2a, and 4) is amended by adding at

the end the following: ‘‘(E)(i) To the extent necessary or appropriate in the public

interest, to promote fair competition, and consistent with promotion

of market efficiency, innovation, and expansion of investment

opportunities, the protection of investors, and the maintenance

of fair and orderly markets, the Commission and the Securities

and Exchange Commission shall jointly issue such rules, regulations, or orders as are necessary and appropriate to permit the

offer and sale of a security futures product traded on or subject

to the rules of a foreign board of trade to United States persons. ‘‘(ii) The rules, regulations, or orders adopted under clause

(i) shall take into account, as appropriate, the nature and size

of the markets that the securities underlying the security futures

product reflects.’’. ( j) SECURITY FUTURES PRODUCTS TRADED ON FOREIGN BOARDS

OF TRADE.—Section 2(a)(1) of the Commodity Exchange Act (7

U.S.C. 2, 2a, and 4) is amended by adding at the end the following: ‘‘(F)(i) Nothing in this Act is intended to prohibit a futures

commission merchant from carrying security futures products

traded on or subject to the rules of a foreign board of trade in

the accounts of persons located outside of the United States. ‘‘(ii) Nothing in this Act is intended to prohibit any eligible

contract participant located in the United States from purchasing

or carrying securities futures products traded on or subject to

the rules of a foreign board of trade, exchange, or market to the

same extent such person may be authorized to purchase or carry

other securities traded on a foreign board of trade, exchange, or

market so long as any underlying security for such security futures

products is traded principally on, by, or through any exchange

or market located outside the United States.’’.

SEC. 252. APPLICATION OF THE COMMODITY EXCHANGE ACT TO

NATIONAL SECURITIES EXCHANGES AND NATIONAL

SECURITIES ASSOCIATIONS THAT TRADE SECURITY

FUTURES.

(a) NOTICE DESIGNATION OF NATIONAL SECURITIES EXCHANGES

AND NATIONAL SECURITIES ASSOCIATIONS.—The Commodity

Exchange Act is amended by inserting after section 5e (7 U.S.C.

7b), as redesignated by section 21(1), the following:

‘‘SEC. 5f. DESIGNATION OF SECURITIES EXCHANGES AND ASSOCIATIONS AS CONTRACT MARKETS.

‘‘(a) Any board of trade that is registered with the Securities

and Exchange Commission as a national securities exchange, is

a national securities association registered pursuant to section

15A(a) of the Securities Exchange Act of 1934, or is an alternative

trading system shall be a designated contract market in security

futures products if—

‘‘(1) such national securities exchange, national securities

association, or alternative trading system lists or trades no

other contracts of sale for future delivery, except for security

futures products;

114 STAT. 2763A–446 PUBLIC LAW 106–554—APPENDIX E

‘‘(2) such national securities exchange, national securities

association, or alternative trading system files written notice

with the Commission in such form as the Commission, by

rule, may prescribe containing such information as the Commission, by rule, may prescribe as necessary or appropriate in

the public interest or for the protection of customers; and

‘‘(3) the registration of such national securities exchange,

national securities association, or alternative trading system

is not suspended pursuant to an order by the Securities and

Exchange Commission.

Such designation shall be effective contemporaneously with the

submission of notice, in written or electronic form, to the Commission.

‘‘(b)(1) A national securities exchange, national securities

association, or alternative trading system that is designated as

a contract market pursuant to section 5f shall be exempt from

the following provisions of this Act and the rules thereunder:

‘‘(A) Subsections (c), (e), and (g) of section 4c.

‘‘(B) Section 4j.

‘‘(C) Section 5.

‘‘(D) Section 5c.

‘‘(E) Section 6a.

‘‘(F) Section 8(d).

‘‘(G) Section 9(f ).

‘‘(H) Section 16.

‘‘(2) An alternative trading system that is a designated contract

market under this section shall be required to be a member of

a futures association registered under section 17 and shall be

exempt from any provision of this Act that would require such

alternative trading system to—

‘‘(A) set rules governing the conduct of subscribers other

than the conduct of such subscribers’ trading on such alternative trading system; or

‘‘(B) discipline subscribers other than by exclusion from

trading.

‘‘(3) To the extent that an alternative trading system is exempt

from any provision of this Act pursuant to paragraph (2) of this

subsection, the futures association registered under section 17 of

which the alternative trading system is a member shall set rules

governing the conduct of subscribers to the alternative trading

system and discipline the subscribers.

‘‘(4)(A) Except as provided in subparagraph (B), but notwithstanding any other provision of this Act, the Commission, by rule,

regulation, or order, may conditionally or unconditionally exempt

any designated contract market in security futures subject to the

designation requirement of this section from any provision of this

Act or of any rule or regulation thereunder, to the extent such

exemption is necessary or appropriate in the public interest and

is consistent with the protection of investors.

‘‘(B) The Commission shall, by rule or regulation, determine

the procedures under which an exemptive order under this section

is granted and may, in its sole discretion, decline to entertain

any application for an order of exemption under this section.

‘‘(C) An alternative trading system shall not be deemed to

be an exchange for any purpose as a result of the designation

of such alternative trading system as a contract market under

this section.’’.

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–447

(b) NOTICE REGISTRATION OF CERTAIN SECURITIES BROKER- DEALERS; EXEMPTION FROM REGISTRATION FOR CERTAIN SECURITIES

BROKER-DEALERS.—Section 4f(a) of the Commodity Exchange Act

(7 U.S.C. 6f(a)) is amended— (1) by inserting ‘‘(1)’’ after ‘‘(a)’’; and

(2) by adding at the end the following: ‘‘(2) Notwithstanding paragraph (1), and except as provided

in paragraph (3), any broker or dealer that is registered with

the Securities and Exchange Commission shall be registered as

a futures commission merchant or introducing broker, as applicable,

if— ‘‘(A) the broker or dealer limits its solicitation of orders,

acceptance of orders, or execution of orders, or placing of orders

on behalf of others involving any contracts of sale of any

commodity for future delivery, on or subject to the rules of

any contract market or registered derivatives transaction execution facility to security futures products; ‘‘(B) the broker or dealer files written notice with the

Commission in such form as the Commission, by rule, may

prescribe containing such information as the Commission, by

rule, may prescribe as necessary or appropriate in the public

interest or for the protection of investors; ‘‘(C) the registration of the broker or dealer is not suspended pursuant to an order of the Securities and Exchange

Commission; and ‘‘(D) the broker or dealer is a member of a national securities association registered pursuant to section 15A(a) of the

Securities Exchange Act of 1934.

The registration shall be effective contemporaneously with the

submission of notice, in written or electronic form, to the Commission.

‘‘(3) A floor broker or floor trader shall be exempt from the

registration requirements of section 4e and paragraph (1) of this

subsection if—

‘‘(A) the floor broker or floor trader is a broker or dealer

registered with the Securities and Exchange Commission;

‘‘(B) the floor broker or floor trader limits its solicitation

of orders, acceptance of orders, or execution of orders, or placing

of orders on behalf of others involving any contracts of sale

of any commodity for future delivery, on or subject to the

rules of any contract market to security futures products; and

‘‘(C) the registration of the floor broker or floor trader

is not suspended pursuant to an order of the Securities and

Exchange Commission.’’.

(c) EXEMPTION FOR SECURITIES BROKER-DEALERS FROM CERTAIN PROVISIONS OF THE COMMODITY EXCHANGE ACT.—Section 4f(a)

of the Commodity Exchange Act (7 U.S.C. 6f(a)) is amended by

inserting after paragraph (3), as added by subsection (b) of this

section, the following:

‘‘(4)(A) A broker or dealer that is registered as a futures commission merchant or introducing broker pursuant to paragraph (2),

or that is a floor broker or floor trader exempt from registration

pursuant to paragraph (3), shall be exempt from the following

provisions of this Act and the rules thereunder:

‘‘(i) Subsections (b), (d), (e), and (g) of section 4c.

‘‘(ii) Sections 4d, 4e, and 4h.

‘‘(iii) Subsections (b) and (c) of this section.

114 STAT. 2763A–448 PUBLIC LAW 106–554—APPENDIX E

‘‘(iv) Section 4j.

‘‘(v) Section 4k(1).

‘‘(vi) Section 4p.

‘‘(vii) Section 6d.

‘‘(viii) Subsections (d) and (g) of section 8.

‘‘(ix) Section 16.

‘‘(B)(i) Except as provided in clause (ii) of this subparagraph,

but notwithstanding any other provision of this Act, the Commission, by rule, regulation, or order, may conditionally or unconditionally exempt any broker or dealer subject to the registration requirement of paragraph (2), or any broker or dealer exempt from registration pursuant to paragraph (3), from any provision of this Act

or of any rule or regulation thereunder, to the extent the exemption

is necessary or appropriate in the public interest and is consistent

with the protection of investors.

‘‘(ii) The Commission shall, by rule or regulation, determine

the procedures under which an exemptive order under this section

shall be granted and may, in its sole discretion, decline to entertain

any application for an order of exemption under this section.

‘‘(C)(i) A broker or dealer that is registered as a futures commission merchant or introducing broker pursuant to paragraph (2)

or an associated person thereof, or that is a floor broker or floor

trader exempt from registration pursuant to paragraph (3), shall

not be required to become a member of any futures association

registered under section 17.

‘‘(ii) No futures association registered under section 17 shall

limit its members from carrying an account, accepting an order,

or transacting business with a broker or dealer that is registered

as a futures commission merchant or introducing broker pursuant

to paragraph (2) or an associated person thereof, or that is a

floor broker or floor trader exempt from registration pursuant to

paragraph (3).’’.

(d) EXEMPTIONS FOR ASSOCIATED PERSONS OF SECURITIES

BROKER-DEALERS.—Section 4k of the Commodity Exchange Act (7

U.S.C. 6k), is amended by inserting after paragraph (4), as added

by subsection (c) of this section, the following:

‘‘(5) Any associated person of a broker or dealer that is registered with the Securities and Exchange Commission, and who

limits its solicitation of orders, acceptance of orders, or execution

of orders, or placing of orders on behalf of others involving any

contracts of sale of any commodity for future delivery or any option

on such a contract, on or subject to the rules of any contract

market or registered derivatives transaction execution facility to

security futures products, shall be exempt from the following provisions of this Act and the rules thereunder:

‘‘(A) Subsections (b), (d), (e), and (g) of section 4c.

‘‘(B) Sections 4d, 4e, and 4h.

‘‘(C) Subsections (b) and (c) of section 4f.

‘‘(D) Section 4j.

‘‘(E) Paragraph (1) of this section.

‘‘(F) Section 4p.

‘‘(G) Section 6d.

‘‘(H) Subsections (d) and (g) of section 8.

‘‘(I) Section 16.’’.

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–449

SEC. 253. NOTIFICATION OF INVESTIGATIONS AND ENFORCEMENT

ACTIONS.

(a) Section 8(a) of the Commodity Exchange Act (7 U.S.C.

12(a)) is amended by adding at the end the following:

‘‘(3) The Commission shall provide the Securities and Exchange

Commission with notice of the commencement of any proceeding

and a copy of any order entered by the Commission against any

futures commission merchant or introducing broker registered

pursuant to section 4f(a)(2), any floor broker or floor trader exempt

from registration pursuant to section 4f(a)(3), any associated person

exempt from registration pursuant to section 4k(6), or any board

of trade designated as a contract market pursuant to section 5f.’’.

(b) Section 6 of the Commodity Exchange Act (7 U.S.C. 8,

9, 9a, 9b, 13b, 15) is amended by adding at the end the following:

‘‘(g) The Commission shall provide the Securities and Exchange

Commission with notice of the commencement of any proceeding

and a copy of any order entered by the Commission pursuant

to subsections (c) and (d) of this section against any futures commission merchant or introducing broker registered pursuant to section

4f(a)(2), any floor broker or floor trader exempt from registration

pursuant to section 4f(a)(3), any associated person exempt from

registration pursuant to section 4k(6), or any board of trade designated as a contract market pursuant to section 5f.’’.

(c) Section 6c of the Commodity Exchange Act (7 U.S.C. 13a–

1) is amended by adding at the end the following:

‘‘(h) The Commission shall provide the Securities and Exchange

Commission with notice of the commencement of any proceeding

and a copy of any order entered by the Commission against any

futures commission merchant or introducing broker registered

pursuant to section 4f(a)(2), any floor broker or floor trader exempt

from registration pursuant to section 4f(a)(3), any associated person

exempt from registration pursuant to section 4k(6), or any board

of trade designated as a contract market pursuant to section 5f.’’.

TITLE III—LEGAL CERTAINTY FOR

SWAP AGREEMENTS

SEC. 301. SWAP AGREEMENT.

(a) AMENDMENT.—Title II of the Gramm-Leach-Bliley Act (Public Law 106–102) is amended by inserting after section 206 the

following new sections:

‘‘SEC. 206A. SWAP AGREEMENT.

‘‘(a) IN GENERAL.—Except as provided in subsection (b), as

used in this section, the term ‘swap agreement’ means any agreement, contract, or transaction between eligible contract participants

(as defined in section 1a(12) of the Commodity Exchange Act as

in effect on the date of the enactment of this section), other than

a person that is an eligible contract participant under section

1a(12)(C) of the Commodity Exchange Act, the material terms of

which (other than price and quantity) are subject to individual

negotiation, and that—

‘‘(1) is a put, call, cap, floor, collar, or similar option of

any kind for the purchase or sale of, or based on the value

of, one or more interest or other rates, currencies, commodities,

114 STAT. 2763A–450 PUBLIC LAW 106–554—APPENDIX E

indices, quantitative measures, or other financial or economic

interests or property of any kind;

‘‘(2) provides for any purchase, sale, payment or delivery

(other than a dividend on an equity security) that is dependent

on the occurrence, non-occurrence, or the extent of the occurrence of an event or contingency associated with a potential

financial, economic, or commercial consequence;

‘‘(3) provides on an executory basis for the exchange, on

a fixed or contingent basis, of one or more payments based

on the value or level of one or more interest or other rates,

currencies, commodities, securities, instruments of indebtedness, indices, quantitative measures, or other financial or economic interests or property of any kind, or any interest therein

or based on the value thereof, and that transfers, as between

the parties to the transaction, in whole or in part, the financial

risk associated with a future change in any such value or

level without also conveying a current or future direct or

indirect ownership interest in an asset (including any enterprise

or investment pool) or liability that incorporates the financial

risk so transferred, including any such agreement, contract,

or transaction commonly known as an interest rate swap,

including a rate floor, rate cap, rate collar, cross-currency rate

swap, basis swap, currency swap, equity index swap, equity

swap, debt index swap, debt swap, credit spread, credit default

swap, credit swap, weather swap, or commodity swap;

‘‘(4) provides for the purchase or sale, on a fixed or contingent basis, of any commodity, currency, instrument, interest,

right, service, good, article, or property of any kind; or

‘‘(5) is any combination or permutation of, or option on,

any agreement, contract, or transaction described in any of

paragraphs (1) through (4).

‘‘(b) EXCLUSIONS.—The term ‘swap agreement’ does not

include—

‘‘(1) any put, call, straddle, option, or privilege on any

security, certificate of deposit, or group or index of securities,

including any interest therein or based on the value thereof;

‘‘(2) any put, call, straddle, option, or privilege entered

into on a national securities exchange registered pursuant to

section 6(a) of the Securities Exchange Act of 1934 relating

to foreign currency;

‘‘(3) any agreement, contract, or transaction providing for

the purchase or sale of one or more securities on a fixed

basis;

‘‘(4) any agreement, contract, or transaction providing for

the purchase or sale of one or more securities on a contingent

basis, unless such agreement, contract, or transaction predicates such purchase or sale on the occurrence of a bona fide

contingency that might reasonably be expected to affect or

be affected by the creditworthiness of a party other than a

party to the agreement, contract, or transaction;

‘‘(5) any note, bond, or evidence of indebtedness that is

a security as defined in section 2(a)(1) of the Securities Act

of 1933 or section 3(a)(10) of the Securities Exchange Act of

1934; or

‘‘(6) any agreement, contract, or transaction that is—

‘‘(A) based on a security; and

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–451

‘‘(B) entered into directly or through an underwriter

(as defined in section 2(a) of the Securities Act of 1933)

by the issuer of such security for the purposes of raising

capital, unless such agreement, contract, or transaction

is entered into to manage a risk associated with capital

raising.

‘‘(c) RULE OF CONSTRUCTION REGARDING MASTER AGREEMENTS.—As used in this section, the term ‘swap agreement’ shall

be construed to include a master agreement that provides for an

agreement, contract, or transaction that is a swap agreement pursuant to subsections (a) and (b), together with all supplements to

any such master agreement, without regard to whether the master

agreement contains an agreement, contract, or transaction that

is not a swap agreement pursuant to subsections (a) and (b), except

that the master agreement shall be considered to be a swap agreement only with respect to each agreement, contract, or transaction

under the master agreement that is a swap agreement pursuant

to subsections (a) and (b).

‘‘SEC. 206B. SECURITY-BASED SWAP AGREEMENT.

‘‘As used in this section, the term ‘security-based swap agreement’ means a swap agreement (as defined in section 206A) of

which a material term is based on the price, yield, value, or volatility of any security or any group or index of securities, or any

interest therein.

‘‘SEC. 206C. NON-SECURITY-BASED SWAP AGREEMENT.

‘‘As used in this section, the term ‘non-security-based swap

agreement’ means any swap agreement (as defined in section 206A)

that is not a security-based swap agreement (as defined in section

206B).’’.

(b) SECURITY DEFINITION.—As used in the amendment made

by subsection (a), the term ‘‘security’’ has the same meaning as

in section 2(a)(1) of the Securities Act of 1933 or section 3(a)(10)

of the Securities Exchange Act of 1934.

SEC. 302. AMENDMENTS TO THE SECURITIES ACT OF 1933.

(a) ENFORCEMENT FOCUS.—The Securities Act of 1933 is amended by inserting after section 2 (15 U.S.C. 77b) the following new

section:

‘‘SEC. 2A. SWAP AGREEMENTS.

‘‘(a) NON-SECURITY-BASED SWAP AGREEMENTS.—The definition

of ‘security’ in section 2(a)(1) of this title does not include any

non-security-based swap agreement (as defined in section 206C

of the Gramm-Leach-Bliley Act).

‘‘(b) SECURITY-BASED SWAP AGREEMENTS.—

‘‘(1) The definition of ‘security’ in section 2(a)(1) of this

title does not include any security-based swap agreement (as

defined in section 206B of the Gramm-Leach-Bliley Act).

‘‘(2) The Commission is prohibited from registering, or

requiring, recommending, or suggesting, the registration under

this title of any security-based swap agreement (as defined

in section 206B of the Gramm-Leach-Bliley Act). If the Commission becomes aware that a registrant has filed a registration

114 STAT. 2763A–452 PUBLIC LAW 106–554—APPENDIX E

statement with respect to such a swap agreement, the Commission shall promptly so notify the registrant. Any such registration statement with respect to such a swap agreement shall

be void and of no force or effect. ‘‘(3) The Commission is prohibited from— ‘‘(A) promulgating, interpreting, or enforcing rules; or

‘‘(B) issuing orders of general applicability;

under this title in a manner that imposes or specifies reporting

or recordkeeping requirements, procedures, or standards as

prophylactic measures against fraud, manipulation, or insider

trading with respect to any security-based swap agreement

(as defined in section 206B of the Gramm-Leach-Bliley Act). ‘‘(4) References in this title to the ‘purchase’ or ‘sale’ of

a security-based swap agreement shall be deemed to mean

the execution, termination (prior to its scheduled maturity

date), assignment, exchange, or similar transfer or conveyance

of, or extinguishing of rights or obligations under, a securitybased swap agreement (as defined in section 206B of the

Gramm-Leach-Bliley Act), as the context may require.’’. (b) ANTI-FRAUD AND ANTI-MANIPULATION ENFORCEMENT

AUTHORITY.—Section 17(a) of the Securities Act of 1933 (15 U.S.C.

77q(a)) is amended to read as follows: ‘‘(a) It shall be unlawful for any person in the offer or sale

of any securities or any security-based swap agreement (as defined

in section 206B of the Gramm-Leach-Bliley Act) by the use of

any means or instruments of transportation or communication in

interstate commerce or by use of the mails, directly or indirectly— ‘‘(1) to employ any device, scheme, or artifice to defraud,

or ‘‘(2) to obtain money or property by means of any untrue

statement of a material fact or any omission to state a material

fact necessary in order to make the statements made, in light

of the circumstances under which they were made, not misleading; or‘‘(3) to engage in any transaction, practice, or course of

business which operates or would operate as a fraud or deceit

upon the purchaser.’’. (c) LIMITATION.—Section 17 of the Securities Act of 1933 is

amended by adding at the end the following new subsection: ‘‘(d) The authority of the Commission under this section with

respect to security-based swap agreements (as defined in section

206B of the Gramm-Leach-Bliley Act) shall be subject to the restrictions and limitations of section 2A(b) of this title.’’.

SEC. 303. AMENDMENTS TO THE SECURITIES EXCHANGE ACT OF 1934.

(a) ENFORCEMENT FOCUS.—The Securities Exchange Act of 1934

is amended by inserting after section 3 (15 U.S.C. 78c) the following

new section:

‘‘SEC. 3A. SWAP AGREEMENTS.

‘‘(a) NON-SECURITY-BASED SWAP AGREEMENTS.—The definition

of ‘security’ in section 3(a)(10) of this title does not include any

non-security-based swap agreement (as defined in section 206C

of the Gramm-Leach-Bliley Act).

‘‘(b) SECURITY-BASED SWAP AGREEMENTS.—

‘‘(1) The definition of ‘security’ in section 3(a)(10) of this

title does not include any security-based swap agreement (as

defined in section 206B of the Gramm-Leach-Bliley Act).

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–453

‘‘(2) The Commission is prohibited from registering, or

requiring, recommending, or suggesting, the registration under

this title of any security-based swap agreement (as defined

in section 206B of the Gramm-Leach-Bliley Act). If the Commission becomes aware that a registrant has filed a registration

application with respect to such a swap agreement, the Commission shall promptly so notify the registrant. Any such registration with respect to such a swap agreement shall be void

and of no force or effect.

‘‘(3) Except as provided in section 16(a) with respect to

reporting requirements, the Commission is prohibited from—

‘‘(A) promulgating, interpreting, or enforcing rules; or

‘‘(B) issuing orders of general applicability;

under this title in a manner that imposes or specifies reporting

or recordkeeping requirements, procedures, or standards as

prophylactic measures against fraud, manipulation, or insider

trading with respect to any security-based swap agreement

(as defined in section 206B of the Gramm-Leach-Bliley Act).

‘‘(4) References in this title to the ‘purchase’ or ‘sale’ of

a security-based swap agreement (as defined in section 206B

of the Gramm-Leach-Bliley Act) shall be deemed to mean the

execution, termination (prior to its scheduled maturity date),

assignment, exchange, or similar transfer or conveyance of,

or extinguishing of rights or obligations under, a security-based

swap agreement, as the context may require.’’.

(b) ANTI-FRAUD, ANTI-MANIPULATION ENFORCEMENT AUTHORITY.—Paragraphs (2) through (5) of section 9(a) of the Securities

Exchange Act of 1934 (15 U.S.C. 78i(a)(2)–(5)) are amended to

read as follows:

‘‘(2) To effect, alone or with one or more other persons, a

series of transactions in any security registered on a national securities exchange or in connection with any security-based swap agreement (as defined in section 206B of the Gramm-Leach-Bliley Act)

with respect to such security creating actual or apparent active

trading in such security, or raising or depressing the price of such

security, for the purpose of inducing the purchase or sale of such

security by others.

‘‘(3) If a dealer or broker, or other person selling or offering

for sale or purchasing or offering to purchase the security or a

security-based swap agreement (as defined in section 206B of the

Gramm-Leach-Bliley Act) with respect to such security, to induce

the purchase or sale of any security registered on a national securities exchange or any security-based swap agreement (as defined

in section 206B of the Gramm-Leach-Bliley Act) with respect to

such security by the circulation or dissemination in the ordinary

course of business of information to the effect that the price of

any such security will or is likely to rise or fall because of market

operations of any one or more persons conducted for the purpose

of raising or depressing the price of such security.

‘‘(4) If a dealer or broker, or the person selling or offering

for sale or purchasing or offering to purchase the security or a

security-based swap agreement (as defined in section 206B of the

Gramm-Leach-Bliley Act) with respect to such security, to make,

regarding any security registered on a national securities exchange

or any security-based swap agreement (as defined in section 206B

of the Gramm-Leach-Bliley Act) with respect to such security, for

the purpose of inducing the purchase or sale of such security or

114 STAT. 2763A–454 PUBLIC LAW 106–554—APPENDIX E

such security-based swap agreement, any statement which was

at the time and in the light of the circumstances under which

it was made, false or misleading with respect to any material

fact, and which he knew or had reasonable ground to believe was

so false or misleading.

‘‘(5) For a consideration, received directly or indirectly from

a dealer or broker, or other person selling or offering for sale

or purchasing or offering to purchase the security or a securitybased swap agreement (as defined in section 206B of the GrammLeach-Bliley Act) with respect to such security, to induce the purchase of any security registered on a national securities exchange

or any security-based swap agreement (as defined in section 206B

of the Gramm-Leach-Bliley Act) with respect to such security by

the circulation or dissemination of information to the effect that

the price of any such security will or is likely to rise or fall

because of the market operations of any one or more persons conducted for the purpose of raising or depressing the price of such

security.’’.

(c) LIMITATION.—Section 9 of the Securities Exchange Act of

1934 is amended by adding at the end the following new subsection:

‘‘(i) The authority of the Commission under this section with

respect to security-based swap agreements (as defined in section

206B of the Gramm-Leach-Bliley Act) shall be subject to the restrictions and limitations of section 3A(b) of this title.’’.

(d) REGULATIONS ON THE USE OF MANIPULATIVE AND DECEPTIVE

DEVICES.—Section 10 of the Securities Exchange Act of 1934 (15

U.S.C. 78j) is amended—

(1) in subsection (b), by inserting ‘‘or any securities-based

swap agreement (as defined in section 206B of the GrammLeach-Bliley Act),’’ before ‘‘any manipulative or deceptive

device’’; and

(2) by adding at the end the following:

‘‘Rules promulgated under subsection (b) that prohibit fraud,

manipulation, or insider trading (but not rules imposing or specifying reporting or recordkeeping requirements, procedures, or standards as prophylactic measures against fraud, manipulation, or

insider trading), and judicial precedents decided under subsection

(b) and rules promulgated thereunder that prohibit fraud, manipulation, or insider trading, shall apply to security-based swap agreements (as defined in section 206B of the Gramm-Leach-Bliley Act)

to the same extent as they apply to securities. Judicial precedents

decided under section 17(a) of the Securities Act of 1933 and sections

9, 15, 16, 20, and 21A of this title, and judicial precedents decided

under applicable rules promulgated under such sections, shall apply

to security-based swap agreements (as defined in section 206B

of the Gramm-Leach-Bliley Act) to the same extent as they apply

to securities.’’.

(e) BROKER, DEALER ANTI-FRAUD, ANTI-MANIPULATION

ENFORCEMENT AUTHORITY.—Section 15(c)(1) of the Securities

Exchange Act of 1934 (15 U.S.C. 78o(c)(1)) is amended to read

as follows: ‘‘(c)(1)(A) No broker or dealer shall make use of the mails

or any means or instrumentality of interstate commerce to effect

any transaction in, or to induce or attempt to induce the purchase

or sale of, any security (other than commercial paper, bankers’

acceptances, or commercial bills) otherwise than on a national securities exchange of which it is a member, or any security-based

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–455

swap agreement (as defined in section 206B of the Gramm-LeachBliley Act), by means of any manipulative, deceptive, or other

fraudulent device or contrivance. ‘‘(B) No municipal securities dealer shall make use of the mails

or any means or instrumentality of interstate commerce to effect

any transaction in, or to induce or attempt to induce the purchase

or sale of, any municipal security or any security-based swap agreement (as defined in section 206B of the Gramm-Leach-Bliley Act)

involving a municipal security by means of any manipulative, deceptive, or other fraudulent device or contrivance.

‘‘(C) No government securities broker or government securities

dealer shall make use of the mails or any means or instrumentality

of interstate commerce to effect any transaction in, or to induce

or to attempt to induce the purchase or sale of, any government

security or any security-based swap agreement (as defined in section

206B of the Gramm-Leach-Bliley Act) involving a government security by means of any manipulative, deceptive, or other fraudulent

device or contrivance.’’.

(f ) LIMITATION.—Section 15 of the Securities Exchange Act

of 1934 (15 U.S.C. 78o) is amended by adding at the end the

following new subsection:

‘‘(i) The authority of the Commission under this section with

respect to security-based swap agreements (as defined in section

206B of the Gramm-Leach-Bliley Act) shall be subject to the restrictions and limitations of section 3A(b) of this title.’’.

(g) ANTI-INSIDER TRADING ENFORCEMENT AUTHORITY.—Subsections (a) and (b) of section 16 (15 U.S.C. 78p(a), (b)) of the

Securities Exchange of 1934 are amended to read as follows:

‘‘(a) Every person who is directly or indirectly the beneficial

owner of more than 10 per centum of any class of any equity

security (other than an exempted security) which is registered

pursuant to section 12 of this title, or who is a director or an

officer of the issuer of such security, shall file, at the time of

the registration of such security on a national securities exchange

or by the effective date of a registration statement filed pursuant

to section 12(g) of this title, or within ten days after he becomes

such beneficial owner, director, or officer, a statement with the

Commission (and, if such security is registered on a national securities exchange, also with the exchange) of the amount of all equity

securities of such issuer of which he is the beneficial owner, and

within ten days after the close of each calendar month thereafter,

if there has been a change in such ownership or if such person

shall have purchased or sold a security-based swap agreement

(as defined in section 206B of the Gramm-Leach-Bliley Act) involving such equity security during such month, shall file with the

Commission (and if such security is registered on a national securities exchange, shall also file with the exchange), a statement

indicating his ownership at the close of the calendar month and

such changes in his ownership and such purchases and sales of

such security-based swap agreements as have occurred during such

calendar month.

‘‘(b) For the purpose of preventing the unfair use of information

which may have been obtained by such beneficial owner, director,

or officer by reason of his relationship to the issuer, any profit

realized by him from any purchase and sale, or any sale and

purchase, of any equity security of such issuer (other than an

exempted security) or a security-based swap agreement (as defined

114 STAT. 2763A–456 PUBLIC LAW 106–554—APPENDIX E

in section 206B of the Gramm-Leach-Bliley Act) involving any such

equity security within any period of less than six months, unless

such security or security-based swap agreement was acquired in

good faith in connection with a debt previously contracted, shall

inure to and be recoverable by the issuer, irrespective of any

intention on the part of such beneficial owner, director, or officer

in entering into such transaction of holding the security or securitybased swap agreement purchased or of not repurchasing the security

or security-based swap agreement sold for a period exceeding six

months. Suit to recover such profit may be instituted at law or

in equity in any court of competent jurisdiction by the issuer,

or by the owner of any security of the issuer in the name and

in behalf of the issuer if the issuer shall fail or refuse to bring

such suit within sixty days after request or shall fail diligently

to prosecute the same thereafter; but no such suit shall be brought

more than two years after the date such profit was realized. This

subsection shall not be construed to cover any transaction where

such beneficial owner was not such both at the time of the purchase

and sale, or the sale and purchase, of the security or securitybased swap agreement (as defined in section 206B of the GrammLeach-Bliley Act) involved, or any transaction or transactions which

the Commission by rules and regulations may exempt as not comprehended within the purpose of this subsection.’’.

(h) LIMITATION.—Section 16 of the Securities Exchange Act

of 1934 (15 U.S.C. 78p) is amended by adding at the end the

following new subsection:

‘‘(g) The authority of the Commission under this section with

respect to security-based swap agreements (as defined in section

206B of the Gramm-Leach-Bliley Act) shall be subject to the restrictions and limitations of section 3A(b) of this title.’’.

(i) MATERIAL NONPUBLIC INFORMATION.—Section 20(d) of the

Securities Exchange Act of 1934 (15 U.S.C. 78t(d)) is amended

to read as follows:

‘‘(d) Wherever communicating, or purchasing or selling a security while in possession of, material nonpublic information would

violate, or result in liability to any purchaser or seller of the

security under any provisions of this title, or any rule or regulation

thereunder, such conduct in connection with a purchase or sale

of a put, call, straddle, option, privilege or security-based swap

agreement (as defined in section 206B of the Gramm-Leach-Bliley

Act) with respect to such security or with respect to a group or

index of securities including such security, shall also violate and

result in comparable liability to any purchaser or seller of that

security under such provision, rule, or regulation.’’.

( j) LIMITATION.—Section 20 of the Securities Exchange Act

of 1934 (15 U.S.C. 78t) is amended by adding at the end the

following new subsection:

‘‘(f ) The authority of the Commission under this section with

respect to security-based swap agreements (as defined in section

206B of the Gramm-Leach-Bliley Act) shall be subject to the restrictions and limitations of section 3A(b) of this title.’’.

(k) CIVIL PENALTIES.—Section 21A(a)(1) of the Securities

Exchange Act of 1934 (15 U.S.C. 78u–1(a)(1)) is amended by inserting after ‘‘purchasing or selling a security’’ the following: ‘‘or security-based swap agreement (as defined in section 206B of the

Gramm-Leach-Bliley Act)’’.

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–457

(l) LIMITATION.—Section 21A of the Securities Exchange Act

of 1934 (15 U.S.C. 78u–1) is amended by adding at the end the

following new subsection: ‘‘(g) The authority of the Commission under this section with

respect to security-based swap agreements (as defined in section

206B of the Gramm-Leach-Bliley Act) shall be subject to the restrictions and limitations of section 3A(b) of this title.’’.

SEC. 304. SAVINGS PROVISIONS.

Nothing in this Act or the amendments made by this Act

shall be construed as finding or implying that any swap agreement

is or is not a security for any purpose under the securities laws.

Nothing in this Act or the amendments made by this Act shall

be construed as finding or implying that any swap agreement

is or is not a futures contract or commodity option for any purpose

under the Commodity Exchange Act.

TITLE IV—REGULATORY

RESPONSIBILITY FOR BANK PRODUCTS

SEC. 401. SHORT TITLE.

This title may be cited as the ‘‘Legal Certainty for Bank Products Act of 2000’’.

SEC. 402. DEFINITIONS.

(a) BANK.—In this title, the term ‘‘bank’’ means—

(1) any depository institution (as defined in section 3(c)

of the Federal Deposit Insurance Act);

(2) any foreign bank or branch or agency of a foreign

bank (each as defined in section 1(b) of the International Banking Act of 1978);

(3) any Federal or State credit union (as defined in section

101 of the Federal Credit Union Act);

(4) any corporation organized under section 25A of the

Federal Reserve Act;

(5) any corporation operating under section 25 of the Federal Reserve Act;

(6) any trust company; or

(7) any subsidiary of any entity described in paragraph

(1) through (6) of this subsection, if the subsidiary is regulated

as if the subsidiary were part of the entity and is not a broker

or dealer (as such terms are defined in section 3 of the Securities Exchange Act of 1934) or a futures commission merchant

(as defined in section 1a(20) of the Commodity Exchange Act).

(b) IDENTIFIED BANKING PRODUCT.—In this title, the term

‘‘identified banking product’’ shall have the same meaning as in

paragraphs (1) through (5) of section 206(a) of the Gramm-LeachBliley Act, except that in applying such section for purposes of

this title—

(1) the term ‘‘bank’’ shall have the meaning given in subsection (a) of this section; and

(2) the term ‘‘qualified investor’’ means eligible contract

participant (as defined in section 1a(12) of the Commodity

Exchange Act, as in effect on the date of the enactment of

the Commodity Futures Modernization Act of 2000).

114 STAT. 2763A–458 PUBLIC LAW 106–554—APPENDIX E

(c) HYBRID INSTRUMENT.—In this title, the term ‘‘hybrid

instrument’’ means an identified banking product not excluded by

section 403 of this Act, offered by a bank, having one or more

payments indexed to the value, level, or rate of, or providing for

the delivery of, one or more commodities (as defined in section

1a(4) of the Commodity Exchange Act).

(d) COVERED SWAP AGREEMENT.—In this title, the term ‘‘covered

swap agreement’’ means a swap agreement (as defined in section

206(b) of the Gramm-Leach-Bliley Act), including a credit or equity

swap, based on a commodity other than an agricultural commodity

enumerated in section 1a(4) of the Commodity Exchange Act if—

(1) the swap agreement—

(A) is entered into only between persons that are

eligible contract participants (as defined in section 1a(12)

of the Commodity Exchange Act, as in effect on the date

of the enactment of the Commodity Futures Modernization

Act of 2000) at the time the persons enter into the swap

agreement; and

(B) is not entered into or executed on a trading facility

(as defined in section 1a(33) of the Commodity Exchange

Act); or

(2) the swap agreement—

(A) is entered into or executed on an electronic trading

facility (as defined in section 1a(10) of the Commodity

Exchange Act);

(B) is entered into on a principal-to-principal basis

between parties trading for their own accounts or as

described in section 1a(12)(B)(ii) of the Commodity

Exchange Act;

(C) is entered into only between persons that are

eligible contract participants as described in subparagraph

(A), (B)(ii), or (C) of section 1a(12) of the Commodity

Exchange Act, as in effect on the date of the enactment

of the Commodity Futures Modernization Act of 2000, at

the time the persons enter into the swap agreement; and

(D) is an agreement, contract or transaction in an

excluded commodity (as defined in section 1a(13) of the

Commodity Exchange Act).

SEC. 403. EXCLUSION OF IDENTIFIED BANKING PRODUCTS COMMONLY

OFFERED ON OR BEFORE DECEMBER 5, 2000.

No provision of the Commodity Exchange Act shall apply to,

and the Commodity Futures Trading Commission shall not exercise

regulatory authority with respect to, an identified banking product

if—

(1) an appropriate banking agency certifies that the product

has been commonly offered, entered into, or provided in the

United States by any bank on or before December 5, 2000,

under applicable banking law; and

(2) the product was not prohibited by the Commodity

Exchange Act and not regulated by the Commodity Futures

Trading Commission as a contract of sale of a commodity for

future delivery (or an option on such a contract) or an option

on a commodity, on or before December 5, 2000.

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–459

SEC. 404. EXCLUSION OF CERTAIN IDENTIFIED BANKING PRODUCTS

OFFERED BY BANKS AFTER DECEMBER 5, 2000.

No provision of the Commodity Exchange Act shall apply to,

and the Commodity Futures Trading Commission shall not exercise

regulatory authority with respect to, an identified banking product

which had not been commonly offered, entered into, or provided

in the United States by any bank on or before December 5, 2000,

under applicable banking law if—

(1) the product has no payment indexed to the value, level,

or rate of, and does not provide for the delivery of, any commodity (as defined in section 1a(4) of the Commodity Exchange

Act); or

(2) the product or commodity is otherwise excluded from

the Commodity Exchange Act.

SEC. 405. EXCLUSION OF CERTAIN OTHER IDENTIFIED BANKING PRODUCTS.

(a) IN GENERAL.—No provision of the Commodity Exchange

Act shall apply to, and the Commodity Futures Trading Commission

shall not exercise regulatory authority with respect to, a banking

product if the product is a hybrid instrument that is predominantly

a banking product under the predominance test set forth in subsection (b).

(b) PREDOMINANCE TEST.—A hybrid instrument shall be considered to be predominantly a banking product for purposes of this

section if—

(1) the issuer of the hybrid instrument receives payment

in full of the purchase price of the hybrid instrument substantially contemporaneously with delivery of the hybrid

instrument;

(2) the purchaser or holder of the hybrid instrument is

not required to make under the terms of the instrument, or

any arrangement referred to in the instrument, any payment

to the issuer in addition to the purchase price referred to

in paragraph (1), whether as margin, settlement payment, or

otherwise during the life of the hybrid instrument or at maturity;

(3) the issuer of the hybrid instrument is not subject by

the terms of the instrument to mark-to-market margining

requirements; and

(4) the hybrid instrument is not marketed as a contract

of sale of a commodity for future delivery (or option on such

a contract) subject to the Commodity Exchange Act.

(c) MARK-TO-MARKET MARGINING REQUIREMENT.—For purposes

of subsection (b)(3), mark-to-market margining requirements shall

not include the obligation of an issuer of a secured debt instrument

to increase the amount of collateral held in pledge for the benefit

of the purchaser of the secured debt instrument to secure the

repayment obligations of the issuer under the secured debt

instrument.

SEC. 406. ADMINISTRATION OF THE PREDOMINANCE TEST.

(a) IN GENERAL.—No provision of the Commodity Exchange

Act shall apply to, and the Commodity Futures Trading Commission

shall not regulate, a hybrid instrument, unless the Commission

determines, by or under a rule issued in accordance with this

section, that—

114 STAT. 2763A–460 PUBLIC LAW 106–554—APPENDIX E

(1) the action is necessary and appropriate in the public

interest;

(2) the action is consistent with the Commodity Exchange

Act and the purposes of the Commodity Exchange Act; and

(3) the hybrid instrument is not predominantly a banking

product under the predominance test set forth in section 405(b)

of this Act.

(b) CONSULTATION.—Before commencing a rulemaking or making a determination pursuant to a rule issued under this title,

the Commodity Futures Trading Commission shall consult with

and seek the concurrence of the Board of Governors of the Federal

Reserve System concerning— (1) the nature of the hybrid instrument; and

(2) the history, purpose, extent, and appropriateness of

the regulation of the hybrid instrument under the Commodity

Exchange Act and under appropriate banking laws.

(c) OBJECTION TO COMMISSION REGULATION.—

(1) FILING OF PETITION FOR REVIEW.—The Board of Governors of the Federal Reserve System may obtain review of

any rule or determination referred to in subsection (a) in the

United States Court of Appeals for the District of Columbia

Circuit by filing in the court, not later than 60 days after

the date of publication of the rule or determination, a written

petition requesting that the rule or determination be set aside.

Any proceeding to challenge any such rule or determination

shall be expedited by the court.

(2) TRANSMITTAL OF PETITION AND RECORD.—A copy of a

petition described in paragraph (1) shall be transmitted as

soon as possible by the Clerk of the court to an officer or

employee of the Commodity Futures Trading Commission designated for that purpose. Upon receipt of the petition, the

Commission shall file with the court the rule or determination

under review and any documents referred to therein, and any

other relevant materials prescribed by the court.

(3) EXCLUSIVE JURISDICTION.—On the date of the filing

of a petition under paragraph (1), the court shall have jurisdiction, which shall become exclusive on the filing of the materials

set forth in paragraph (2), to affirm and enforce or to set

aside the rule or determination at issue.

(4) STANDARD OF REVIEW.—The court shall determine to

affirm and enforce or set aside a rule or determination of

the Commodity Futures Trading Commission under this section, based on the determination of the court as to whether—

(A) the subject product is predominantly a banking

product; and

(B) making the provision or provisions of the Commodity Exchange Act at issue applicable to the subject

instrument is appropriate in light of the history, purpose,

and extent of regulation under such Act, this title, and

under the appropriate banking laws, giving deference neither to the views of the Commodity Futures Trading

Commission nor the Board of Governors of the Federal

Reserve System.

(5) JUDICIAL STAY.—The filing of a petition by the Board

pursuant to paragraph (1) shall operate as a judicial stay,

until the date on which the determination of the court is

final (including any appeal of the determination).

PUBLIC LAW 106–554—APPENDIX E 114 STAT. 2763A–461

(6) OTHER AUTHORITY TO CHALLENGE.—Any aggrieved party

may seek judicial review pursuant to section 6(c) of the

Commodity Exchange Act of a determination or rulemaking

by the Commodity Futures Trading Commission under this

section.

SEC. 407. EXCLUSION OF COVERED SWAP AGREEMENTS.

No provision of the Commodity Exchange Act (other than section 5b of such Act with respect to the clearing of covered swap

agreements) shall apply to, and the Commodity Futures Trading

Commission shall not exercise regulatory authority with respect

to, a covered swap agreement offered, entered into, or provided

by a bank.

SEC. 408. CONTRACT ENFORCEMENT.

(a) HYBRID INSTRUMENTS.—No hybrid instrument shall be void,

voidable, or unenforceable, and no party to a hybrid instrument

shall be entitled to rescind, or recover any payment made with

respect to, a hybrid instrument under any provision of Federal

or State law, based solely on the failure of the hybrid instrument

to satisfy the predominance test set forth in section 405(b) of

this Act or to comply with the terms or conditions of an exemption

or exclusion from any provision of the Commodity Exchange Act

or any regulation of the Commodity Futures Trading Commission.

(b) COVERED SWAP AGREEMENTS.—No covered swap agreement

shall be void, voidable, or unenforceable, and no party to a covered

swap agreement shall be entitled to rescind, or recover any payment

made with respect to, a covered swap agreement under any provision of Federal or State law, based solely on the failure of the

covered swap agreement to comply with the terms or conditions

of an exemption or exclusion from any provision of the Commodity

Exchange Act or any regulation of the Commodity Futures Trading

Commission.

(c) PREEMPTION.—This title shall supersede and preempt the

application of any State or local law that prohibits or regulates

gaming or the operation of bucket shops (other than antifraud

provisions of general applicability) in the case of—

(1) a hybrid instrument that is predominantly a banking

product; or

(2) a covered swap agreement.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–463

APPENDIX F—H.R. 5661

SECTION 1. SHORT TITLE; AMENDMENTS TO SOCIAL SECURITY ACT;

REFERENCES TO OTHER ACTS; TABLE OF CONTENTS.

(a) SHORT TITLE.—This Act may be cited as the ‘‘Medicare,

Medicaid, and SCHIP Benefits Improvement and Protection Act

of 2000’’. (b) AMENDMENTS TO SOCIAL SECURITY ACT.—Except as otherwise specifically provided, whenever in this Act an amendment

is expressed in terms of an amendment to or repeal of a section

or other provision, the reference shall be considered to be made

to that section or other provision of the Social Security Act.

(c) REFERENCES TO OTHER ACTS.—In this Act:

(1) BALANCED BUDGET ACT OF 1997.—The term ‘‘BBA’’ means

the Balanced Budget Act of 1997 (Public Law 105–33; 111

Stat. 251).

(2) MEDICARE, MEDICAID, AND SCHIP BALANCED BUDGET

REFINEMENT ACT OF 1999.—The term ‘‘BBRA’’ means the Medicare, Medicaid, and SCHIP Balanced Budget Refinement Act

of 1999 (Appendix F, 113 Stat. 1501A–321), as enacted into

law by section 1000(a)(6) of Public Law 106–113.

(d) TABLE OF CONTENTS.—The table of contents of this Act

is as follows:

Sec. 1. Short title; amendments to Social Security Act; references to other Acts;

table of contents.

TITLE I—MEDICARE BENEFICIARY IMPROVEMENTS

Subtitle A—Improved Preventive Benefits

Sec. 101. Coverage of biennial screening pap smear and pelvic exams.

Sec. 102. Coverage of screening for glaucoma.

Sec. 103. Coverage of screening colonoscopy for average risk individuals.

Sec. 104. Modernization of screening mammography benefit.

Sec. 105. Coverage of medical nutrition therapy services for beneficiaries with diabetes or a renal disease.

Subtitle B—Other Beneficiary Improvements

Sec. 111. Acceleration of reduction of beneficiary copayment for hospital outpatient

department services.

Sec. 112. Preservation of coverage of drugs and biologicals under part B of the

medicare program.

Sec. 113. Elimination of time limitation on medicare benefits for immunosuppressive drugs.

Sec. 114. Imposition of billing limits on drugs.

Sec. 115. Waiver of 24-month waiting period for medicare coverage of individuals

disabled with amyotrophic lateral sclerosis (ALS).

Subtitle C—Demonstration Projects and Studies

Sec. 121. Demonstration project for disease management for severely chronically ill

medicare beneficiaries.

Sec. 122. Cancer prevention and treatment demonstration for ethnic and racial minorities.

114 STAT. 2763A–464 PUBLIC LAW 106–554—APPENDIX F

Sec. 123. Study on medicare coverage of routine thyroid screening.

Sec. 124. MedPAC study on consumer coalitions.

Sec. 125. Study on limitation on State payment for medicare cost-sharing affecting

access to services for qualified medicare beneficiaries.

Sec. 126. Studies on preventive interventions in primary care for older Americans.

Sec. 127. MedPAC study and report on medicare coverage of cardiac and pulmonary rehabilitation therapy services.

Sec. 128. Lifestyle modification program demonstration.

TITLE II—RURAL HEALTH CARE IMPROVEMENTS

Subtitle A—Critical Access Hospital Provisions

Sec. 201. Clarification of no beneficiary cost-sharing for clinical diagnostic laboratory tests furnished by critical access hospitals.

Sec. 202. Assistance with fee schedule payment for professional services under allinclusive rate.

Sec. 203. Exemption of critical access hospital swing beds from SNF PPS.

Sec. 204. Payment in critical access hospitals for emergency room on-call physicians.

Sec. 205. Treatment of ambulance services furnished by certain critical access hospitals.

Sec. 206. GAO study on certain eligibility requirements for critical access hospitals.

Subtitle B—Other Rural Hospitals Provisions

Sec. 211. Treatment of rural disproportionate share hospitals.

Sec. 212. Option to base eligibility for medicare dependent, small rural hospital

program on discharges during two of the three most recently audited

cost reporting periods.

Sec. 213. Extension of option to use rebased target amounts to all sole community

hospitals.

Sec. 214. MedPAC analysis of impact of volume on per unit cost of rural hospitals

with psychiatric units.

Subtitle C—Other Rural Provisions

Sec. 221. Assistance for providers of ambulance services in rural areas.

Sec. 222. Payment for certain physician assistant services.

Sec. 223. Revision of medicare reimbursement for telehealth services.

Sec. 224. Expanding access to rural health clinics.

Sec. 225. MedPAC study on low-volume, isolated rural health care providers.

TITLE III—PROVISIONS RELATING TO PART A

Subtitle A—Inpatient Hospital Services

Sec. 301. Revision of acute care hospital payment update for 2001.

Sec. 302. Additional modification in transition for indirect medical education (IME)

percentage adjustment.

Sec. 303. Decrease in reductions for disproportionate share hospital (DSH) payments.

Sec. 304. Wage index improvements.

Sec. 305. Payment for inpatient services of rehabilitation hospitals.

Sec. 306. Payment for inpatient services of psychiatric hospitals.

Sec. 307. Payment for inpatient services of long-term care hospitals.

Subtitle B—Adjustments to PPS Payments for Skilled Nursing Facilities

Sec. 311. Elimination of reduction in skilled nursing facility (SNF) market basket

update in 2001.

Sec. 312. Increase in nursing component of PPS Federal rate.

Sec. 313. Application of SNF consolidated billing requirement limited to part A covered stays.

Sec. 314. Adjustment of rehabilitation RUGs to correct anomaly in payment rates.

Sec. 315. Establishment of process for geographic reclassification.

Subtitle C—Hospice Care

Sec. 321. Five percent increase in payment base.

Sec. 322. Clarification of physician certification.

Sec. 323. MedPAC report on access to, and use of, hospice benefit.

Subtitle D—Other Provisions

Sec. 331. Relief from medicare part A late enrollment penalty for group buy-in for

State and local retirees.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–465

TITLE IV—PROVISIONS RELATING TO PART B

Subtitle A—Hospital Outpatient Services

Sec. 401. Revision of hospital outpatient PPS payment update.

Sec. 402. Clarifying process and standards for determining eligibility of devices for

pass-through payments under hospital outpatient PPS. Sec. 403. Application of OPD PPS transitional corridor payments to certain hospitals that did not submit a 1996 cost report. Sec. 404. Application of rules for determining provider-based status for certain entities.

Sec. 405. Treatment of children’s hospitals under prospective payment system. Sec. 406. Inclusion of temperature monitored cryoablation in transitional passthrough for certain medical devices, drugs, and biologicals under OPD

PPS.

Subtitle B—Provisions Relating to Physicians’ Services

Sec. 411. GAO studies relating to physicians’ services.

Sec. 412. Physician group practice demonstration.

Sec. 413. Study on enrollment procedures for groups that retain independent contractor physicians.

Subtitle C—Other Services

Sec. 421. One-year extension of moratorium on therapy caps; report on standards

for supervision of physical therapy assistants. Sec. 422. Update in renal dialysis composite rate.

Sec. 423. Payment for ambulance services.

Sec. 424. Ambulatory surgical centers.

Sec. 425. Full update for durable medical equipment.

Sec. 426. Full update for orthotics and prosthetics.

Sec. 427. Establishment of special payment provisions and requirements for prosthetics and certain custom-fabricated orthotic items.

Sec. 428. Replacement of prosthetic devices and parts.

Sec. 429. Revised part B payment for drugs and biologicals and related services.

Sec. 430. Contrast enhanced diagnostic procedures under hospital prospective payment system. Sec. 431. Qualifications for community mental health centers.

Sec. 432. Payment of physician and nonphysician services in certain Indian providers. Sec. 433. GAO study on coverage of surgical first assisting services of certified registered nurse first assistants.

Sec. 434. MedPAC study and report on medicare reimbursement for services provided by certain providers. Sec. 435. MedPAC study and report on medicare coverage of services provided by

certain nonphysician providers. Sec. 436. GAO study and report on the costs of emergency and medical transportation services.

Sec. 437. GAO studies and reports on medicare payments.

Sec. 438. MedPAC study on access to outpatient pain management services.

TITLE V—PROVISIONS RELATING TO PARTS A AND B

Subtitle A—Home Health Services

Sec. 501. One-year additional delay in application of 15 percent reduction on payment limits for home health services.

Sec. 502. Restoration of full home health market basket update for home health

services for fiscal year 2001. Sec. 503. Temporary two-month periodic interim payment.

Sec. 504. Use of telehealth in delivery of home health services.

Sec. 505. Study on costs to home health agencies of purchasing nonroutine medical

supplies. Sec. 506. Treatment of branch offices; GAO study on supervision of home health

care provided in isolated rural areas. Sec. 507. Clarification of the homebound definition under the medicare home

health benefit.

Sec. 508. Temporary increase for home health services furnished in a rural area.

Subtitle B—Direct Graduate Medical Education

Sec. 511. Increase in floor for direct graduate medical education payments.

Sec. 512. Change in distribution formula for Medicare+Choice-related nursing and

allied health education costs.

Subtitle C—Changes in Medicare Coverage and Appeals Process

Sec. 521. Revisions to medicare appeals process.

114 STAT. 2763A–466 PUBLIC LAW 106–554—APPENDIX F

Sec. 522. Revisions to medicare coverage process.

Subtitle D—Improving Access to New Technologies

Sec. 531. Reimbursement improvements for new clinical laboratory tests and durable medical equipment.

Sec. 532. Retention of HCPCS level III codes.

Sec. 533. Recognition of new medical technologies under inpatient hospital PPS.

Subtitle E—Other Provisions

Sec. 541. Increase in reimbursement for bad debt.

Sec. 542. Treatment of certain physician pathology services under medicare.

Sec. 543. Extension of advisory opinion authority.

Sec. 544. Change in annual MedPAC reporting.

Sec. 545. Development of patient assessment instruments.

Sec. 546. GAO report on impact of the Emergency Medical Treatment and Active

Labor Act (EMTALA) on hospital emergency departments.

Sec. 547. Clarification of application of temporary payment increases for 2001.

TITLE VI—PROVISIONS RELATING TO PART C (MEDICARE+CHOICE

PROGRAM) AND OTHER MEDICARE MANAGED CARE PROVISIONS

Subtitle A—Medicare+Choice Payment Reforms

Sec. 601. Increase in minimum payment amount.

Sec. 602. Increase in minimum percentage increase.

Sec. 603. Phase-in of risk adjustment.

Sec. 604. Transition to revised Medicare+Choice payment rates.

Sec. 605. Revision of payment rates for ESRD patients enrolled in Medicare+Choice

plans.

Sec. 606. Permitting premium reductions as additional benefits under

Medicare+Choice plans.

Sec. 607. Full implementation of risk adjustment for congestive heart failure enrollees for 2001.

Sec. 608. Expansion of application of Medicare+Choice new entry bonus.

Sec. 609. Report on inclusion of certain costs of the Department of Veterans Affairs

and military facility services in calculating Medicare+Choice payment

rates.

Subtitle B—Other Medicare+Choice Reforms

Sec. 611. Payment of additional amounts for new benefits covered during a contract

term.

Sec. 612. Restriction on implementation of significant new regulatory requirements

midyear.

Sec. 613. Timely approval of marketing material that follows model marketing language.

Sec. 614. Avoiding duplicative regulation.

Sec. 615. Election of uniform local coverage policy for Medicare+Choice plan covering multiple localities.

Sec. 616. Eliminating health disparities in Medicare+Choice program.

Sec. 617. Medicare+Choice program compatibility with employer or union group

health plans.

Sec. 618. Special medigap enrollment antidiscrimination provision for certain beneficiaries.

Sec. 619. Restoring effective date of elections and changes of elections of

Medicare+Choice plans.

Sec. 620. Permitting ESRD beneficiaries to enroll in another Medicare+Choice plan

if the plan in which they are enrolled is terminated.

Sec. 621. Providing choice for skilled nursing facility services under the

Medicare+Choice program.

Sec. 622. Providing for accountability of Medicare+Choice plans.

Sec. 623. Increased civil money penalty for Medicare+Choice organizations that terminate contracts mid-year.

Subtitle C—Other Managed Care Reforms

Sec. 631. One-year extension of social health maintenance organization (SHMO)

demonstration project.

Sec. 632. Revised terms and conditions for extension of medicare community nursing organization (CNO) demonstration project.

Sec. 633. Extension of medicare municipal health services demonstration projects.

Sec. 634. Service area expansion for medicare cost contracts during transition period.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–467

TITLE VII—MEDICAID

Sec. 701. DSH payments.

Sec. 702. New prospective payment system for Federally-qualified health centers

and rural health clinics.

Sec. 703. Streamlined approval of continued State-wide section 1115 medicaid

waivers.

Sec. 704. Medicaid county-organized health systems.

Sec. 705. Deadline for issuance of final regulation relating to medicaid upper payment limits.

Sec. 706. Alaska FMAP.

Sec. 707. One-year extension of welfare-to-work transition.

Sec. 708. Additional entities qualified to determine medicaid presumptive eligibility

for low-income children.

Sec. 709. Development of uniform QMB/SLMB application form.

Sec. 710. Technical corrections.

TITLE VIII—STATE CHILDREN’S HEALTH INSURANCE PROGRAM

Sec. 801. Special rule for redistribution and availability of unused fiscal year 1998

and 1999 SCHIP allotments.

Sec. 802. Authority to pay medicaid expansion SCHIP costs from title XXI appropriation.

Sec. 803. Application of medicaid child presumptive eligibility provisions.

TITLE IX—OTHER PROVISIONS

Subtitle A—PACE Program

Sec. 901. Extension of transition for current waivers.

Sec. 902. Continuing of certain operating arrangements permitted.

Sec. 903. Flexibility in exercising waiver authority.

Subtitle B—Outreach to Eligible Low-Income Medicare Beneficiaries

Sec. 911. Outreach on availability of medicare cost-sharing assistance to eligible

low-income medicare beneficiaries.

Subtitle C—Maternal and Child Health Block Grant

Sec. 921. Increase in authorization of appropriations for the maternal and child

health services block grant.

Subtitle D—Diabetes

Sec. 931. Increase in appropriations for special diabetes programs for type I diabetes and Indians.

Sec. 932. Appropriations for Ricky Ray Hemophilia Relief Fund.

Subtitle E—Information on Nursing Facility Staffing

Sec. 941. Posting of information on nursing facility staffing.

Subtitle F—Adjustment of Multiemployer Plan Benefits Guaranteed

Sec. 951. Multiemployer plan benefits guaranteed.

TITLE I—MEDICARE BENEFICIARY

IMPROVEMENTS

Subtitle A—Improved Preventive Benefits

SEC. 101. COVERAGE OF BIENNIAL SCREENING PAP SMEAR AND PELVIC EXAMS.

(a) IN GENERAL.—

(1) BIENNIAL SCREENING PAP SMEAR.—Section 1861(nn)(1)

(42 U.S.C. 1395x(nn)(1)) is amended by striking ‘‘3 years’’ and

inserting ‘‘2 years’’.

(2) BIENNIAL SCREENING PELVIC EXAM.—Section 1861(nn)(2)

(42 U.S.C. 1395x(nn)(2)) is amended by striking ‘‘3 years’’ and

inserting ‘‘2 years’’.

114 STAT. 2763A–468 PUBLIC LAW 106–554—APPENDIX F

(b) EFFECTIVE DATE.—The amendments made by subsection

(a) shall apply to items and services furnished on or after July

1, 2001.

SEC. 102. COVERAGE OF SCREENING FOR GLAUCOMA.

(a) COVERAGE.—Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)) is

amended—

(1) by striking ‘‘and’’ at the end of subparagraph (S);

(2) by inserting ‘‘and’’ at the end of subparagraph (T);

and

(3) by adding at the end the following:

‘‘(U) screening for glaucoma (as defined in subsection (uu))

for individuals determined to be at high risk for glaucoma,

individuals with a family history of glaucoma and individuals

with diabetes;’’. (b) SERVICES DESCRIBED.—Section 1861 (42 U.S.C. 1395x) is

amended by adding at the end the following new subsection:

‘‘Screening for Glaucoma

‘‘(uu) The term ‘screening for glaucoma’ means a dilated eye

examination with an intraocular pressure measurement, and a

direct ophthalmoscopy or a slit-lamp biomicroscopic examination

for the early detection of glaucoma which is furnished by or under

the direct supervision of an optometrist or ophthalmologist who

is legally authorized to furnish such services under State law (or

the State regulatory mechanism provided by State law) of the

State in which the services are furnished, as would otherwise be

covered if furnished by a physician or as an incident to a physician’s

professional service, if the individual involved has not had such

an examination in the preceding year.’’.

(c) CONFORMING AMENDMENT.—Section 1862(a)(1)(F) (42 U.S.C.

1395y(a)(1)(F)) is amended—

(1) by striking ‘‘and,’’; and

(2) by adding at the end the following: ‘‘and, in the case

of screening for glaucoma, which is performed more frequently

than is provided under section 1861(uu),’’.

(d) EFFECTIVE DATE.—The amendments made by this section

shall apply to services furnished on or after January 1, 2002.

SEC. 103. COVERAGE OF SCREENING COLONOSCOPY FOR AVERAGE

RISK INDIVIDUALS.

(a) IN GENERAL.—Section 1861(pp) (42 U.S.C. 1395x(pp)) is

amended—

(1) in paragraph (1)(C), by striking ‘‘In the case of an

individual at high risk for colorectal cancer, screening

colonoscopy’’ and inserting ‘‘Screening colonoscopy’’; and

(2) in paragraph (2), by striking ‘‘In paragraph (1)(C), an’’

and inserting ‘‘An’’.

(b) FREQUENCY LIMITS FOR SCREENING COLONOSCOPY.—Section

1834(d) (42 U.S.C. 1395m(d)) is amended— (1) in paragraph (2)(E)(ii), by inserting before the period

at the end the following: ‘‘or, in the case of an individual

who is not at high risk for colorectal cancer, if the procedure

is performed within the 119 months after a previous screening

colonoscopy’’; and

(2) in paragraph (3)—

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–469

(A) in the heading by striking ‘‘FOR INDIVIDUALS AT

HIGH RISK FOR COLORECTAL CANCER’’;

(B) in subparagraph (A), by striking ‘‘for individuals

at high risk for colorectal cancer (as defined in section

1861(pp)(2))’’; and

(C) in subparagraph (E), by inserting before the period

at the end the following: ‘‘or for other individuals if the

procedure is performed within the 119 months after a

previous screening colonoscopy or within 47 months after

a previous screening flexible sigmoidoscopy’’.

(c) EFFECTIVE DATE.—The amendments made by this section

shall apply to colorectal cancer screening services provided on or

after July 1, 2001.

SEC. 104. MODERNIZATION OF SCREENING MAMMOGRAPHY BENEFIT.

(a) INCLUSION IN PHYSICIAN FEE SCHEDULE.—Section 1848( j)(3)

(42 U.S.C. 1395w–4( j)(3)) is amended by inserting ‘‘(13),’’ after ‘‘(4),’’.

(b) CONFORMING AMENDMENT.—Section 1834(c) (42 U.S.C.

1395m(c)) is amended to read as follows:

‘‘(c) PAYMENT AND STANDARDS FOR SCREENING MAMMOGRAPHY.—

‘‘(1) IN GENERAL.—With respect to expenses incurred for

screening mammography (as defined in section 1861(jj)), payment may be made only—

‘‘(A) for screening mammography conducted consistent

with the frequency permitted under paragraph (2); and

‘‘(B) if the screening mammography is conducted by

a facility that has a certificate (or provisional certificate)

issued under section 354 of the Public Health Service Act.

‘‘(2) FREQUENCY COVERED.—

‘‘(A) IN GENERAL.—Subject to revision by the Secretary

under subparagraph (B)—

‘‘(i) no payment may be made under this part

for screening mammography performed on a woman

under 35 years of age;

‘‘(ii) payment may be made under this part for

only one screening mammography performed on a

woman over 34 years of age, but under 40 years of

age; and

‘‘(iii) in the case of a woman over 39 years of

age, payment may not be made under this part for

screening mammography performed within 11 months

following the month in which a previous screening

mammography was performed.

‘‘(B) REVISION OF FREQUENCY.—

‘‘(i) REVIEW.—The Secretary, in consultation with

the Director of the National Cancer Institute, shall

review periodically the appropriate frequency for

performing screening mammography, based on age and

such other factors as the Secretary believes to be pertinent.

‘‘(ii) REVISION OF FREQUENCY.—The Secretary, taking into consideration the review made under clause

(i), may revise from time to time the frequency with

which screening mammography may be paid for under

this subsection.’’.

114 STAT. 2763A–470 PUBLIC LAW 106–554—APPENDIX F

(c) EFFECTIVE DATE.—The amendments made by subsections

(a) and (b) shall apply with respect to screening mammographies

furnished on or after January 1, 2002.

(d) PAYMENT FOR NEW TECHNOLOGIES.—

(1) TESTS FURNISHED IN 2001.—

(A) SCREENING.—For a screening mammography (as

defined in section 1861(jj) of the Social Security Act (42

U.S.C. 1395x(jj))) furnished during the period beginning

on April 1, 2001, and ending on December 31, 2001, that

uses a new technology, payment for such screening

mammography shall be made as follows:

(i) In the case of a technology which directly takes

a digital image (without involving film), in an amount

equal to 150 percent of the amount of payment under

section 1848 of such Act (42 U.S.C. 1395w–4) for a

bilateral diagnostic mammography (under HCPCS code

76091) for such year.

(ii) In the case of a technology which allows conversion of a standard film mammogram into a digital

image and subsequently analyzes such resulting image

with software to identify possible problem areas, in

an amount equal to the limit that would otherwise

be applied under section 1834(c)(3) of such Act (42

U.S.C. 1395m(c)(3)) for 2001, increased by $15.

(B) BILATERAL DIAGNOSTIC MAMMOGRAPHY.—For a

bilateral diagnostic mammography furnished during the

period beginning on April 1, 2001, and ending on December

31, 2001, that uses a new technology described in subparagraph (A), payment for such mammography shall be the

amount of payment provided for under such subparagraph.

(C) ALLOCATION OF AMOUNTS.—The Secretary shall provide for an appropriate allocation of the amounts under

subparagraphs (A) and (B) between the professional and

technical components.

(D) IMPLEMENTATION OF PROVISION.—The Secretary of

Health and Human Services may implement the provisions

of this paragraph by program memorandum or otherwise.

(2) CONSIDERATION OF NEW HCPCS CODE FOR NEW TECHNOLOGIES AFTER 2001.—The Secretary shall determine, for such

mammographies performed after 2001, whether the assignment

of a new HCPCS code is appropriate for mammography that

uses a new technology. If the Secretary determines that a

new code is appropriate for such mammography, the Secretary

shall provide for such new code for such tests furnished after

2001.

(3) NEW TECHNOLOGY DESCRIBED.—For purposes of this

subsection, a new technology with respect to a mammography

is an advance in technology with respect to the test or equipment that results in the following:

(A) A significant increase or decrease in the resources

used in the test or in the manufacture of the equipment.

(B) A significant improvement in the performance of

the test or equipment.

(C) A significant advance in medical technology that

is expected to significantly improve the treatment of medicare beneficiaries.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–471

(4) HCPCS CODE DEFINED.—The term ‘‘HCPCS code’’ means

a code under the Health Care Financing Administration Common Procedure Coding System (HCPCS).

SEC. 105. COVERAGE OF MEDICAL NUTRITION THERAPY SERVICES

FOR BENEFICIARIES WITH DIABETES OR A RENAL DISEASE.

(a) COVERAGE.—Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)), as

amended by section 102(a), is amended— (1) in subparagraph (T), by striking ‘‘and’’ at the end;

(2) in subparagraph (U), by inserting ‘‘and’’ at the end;

and

(3) by adding at the end the following new subparagraph:

‘‘(V) medical nutrition therapy services (as defined in subsection (vv)(1)) in the case of a beneficiary with diabetes or

a renal disease who— ‘‘(i) has not received diabetes outpatient self-management training services within a time period determined

by the Secretary; ‘‘(ii) is not receiving maintenance dialysis for which

payment is made under section 1881; and ‘‘(iii) meets such other criteria determined by the Secretary after consideration of protocols established by dietitian or nutrition professional organizations;’’. (b) SERVICES DESCRIBED.—Section 1861 (42 U.S.C. 1395x), as

amended by section 102(b), is amended by adding at the end the

following:

‘‘Medical Nutrition Therapy Services; Registered Dietitian or

Nutrition Professional

‘‘(vv)(1) The term ‘medical nutrition therapy services’ means

nutritional diagnostic, therapy, and counseling services for the purpose of disease management which are furnished by a registered

dietitian or nutrition professional (as defined in paragraph (2))

pursuant to a referral by a physician (as defined in subsection

(r)(1)).

‘‘(2) Subject to paragraph (3), the term ‘registered dietitian

or nutrition professional’ means an individual who—

‘‘(A) holds a baccalaureate or higher degree granted by

a regionally accredited college or university in the United States

(or an equivalent foreign degree) with completion of the academic requirements of a program in nutrition or dietetics, as

accredited by an appropriate national accreditation organization

recognized by the Secretary for this purpose;

‘‘(B) has completed at least 900 hours of supervised dietetics

practice under the supervision of a registered dietitian or nutrition professional; and

‘‘(C)(i) is licensed or certified as a dietitian or nutrition

professional by the State in which the services are performed;

or

‘‘(ii) in the case of an individual in a State that does

not provide for such licensure or certification, meets such other

criteria as the Secretary establishes.

‘‘(3) Subparagraphs (A) and (B) of paragraph (2) shall not

apply in the case of an individual who, as of the date of the

enactment of this subsection, is licensed or certified as a dietitian

114 STAT. 2763A–472 PUBLIC LAW 106–554—APPENDIX F

or nutrition professional by the State in which medical nutrition

therapy services are performed.’’. (c) PAYMENT.—Section 1833(a)(1) (42 U.S.C. 1395l(a)(1)) is

amended—

(1) by striking ‘‘and’’ before ‘‘(S)’’; and

(2) by inserting before the semicolon at the end the following: ‘‘, and (T) with respect to medical nutrition therapy services

(as defined in section 1861(vv)), the amount paid shall be

80 percent of the lesser of the actual charge for the services

or 85 percent of the amount determined under the fee schedule

established under section 1848(b) for the same services if furnished by a physician’’. (d) APPLICATION OF LIMITS ON BILLING.—Section 1842(b)(18)(C)

(42 U.S.C. 1395u(b)(18)(C)) is amended by adding at the end the

following new clause: ‘‘(vi) A registered dietitian or nutrition professional.’’. (e) EFFECTIVE DATE.—The amendments made by this section

shall apply to services furnished on or after January 1, 2002.

(f ) STUDY.—Not later than July 1, 2003, the Secretary of Health

and Human Services shall submit to Congress a report that contains

recommendations with respect to the expansion to other medicare

beneficiary populations of the medical nutrition therapy services

benefit (furnished under the amendments made by this section).

Subtitle B—Other Beneficiary

Improvements

SEC. 111. ACCELERATION OF REDUCTION OF BENEFICIARY

COPAYMENT FOR HOSPITAL OUTPATIENT DEPARTMENT

SERVICES.

(a) REDUCING THE UPPER LIMIT ON BENEFICIARY COPAYMENT.— (1) IN GENERAL.—Section 1833(t)(8)(C) (42 U.S.C.

1395l(t)(8)(C)) is amended to read as follows: ‘‘(C) LIMITATION ON COPAYMENT AMOUNT.— ‘‘(i) TO INPATIENT HOSPITAL DEDUCTIBLE AMOUNT.— In no case shall the copayment amount for a procedure

performed in a year exceed the amount of the inpatient

hospital deductible established under section 1813(b)

for that year. ‘‘(ii) TO SPECIFIED PERCENTAGE.—The Secretary

shall reduce the national unadjusted copayment

amount for a covered OPD service (or group of such

services) furnished in a year in a manner so that

the effective copayment rate (determined on a national

unadjusted basis) for that service in the year does

not exceed the following percentage: ‘‘(I) For procedures performed in 2001, on or

after April 1, 2001, 57 percent. ‘‘(II) For procedures performed in 2002 or

2003, 55 percent. ‘‘(III) For procedures performed in 2004, 50

percent. ‘‘(IV) For procedures performed in 2005, 45

percent. ‘‘(V) For procedures performed in 2006 and

thereafter, 40 percent.’’.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–473

(2) EFFECTIVE DATE.—The amendment made by paragraph

(1) shall apply with respect to services furnished on or after

April 1, 2001.

(b) CONSTRUCTION REGARDING LIMITING INCREASES IN COST- SHARING.—Nothing in this Act or the Social Security Act shall

be construed as preventing a hospital from waiving the amount

of any coinsurance for outpatient hospital services under the medicare program under title XVIII of the Social Security Act that

may have been increased as a result of the implementation of

the prospective payment system under section 1833(t) of the Social

Security Act (42 U.S.C. 1395l(t)).

(c) GAO STUDY OF REDUCTION IN MEDIGAP PREMIUM LEVELS

RESULTING FROM REDUCTIONS IN COINSURANCE.—The Comptroller

General of the United States shall work, in concert with the

National Association of Insurance Commissioners, to evaluate the

extent to which the premium levels for medicare supplemental

policies reflect the reductions in coinsurance resulting from the

amendment made by subsection (a). Not later than April 1, 2004,

the Comptroller General shall submit to Congress a report on

such evaluation and the extent to which the reductions in beneficiary coinsurance effected by such amendment have resulted in

actual savings to medicare beneficiaries.

SEC. 112. PRESERVATION OF COVERAGE OF DRUGS AND BIOLOGICALS

UNDER PART B OF THE MEDICARE PROGRAM.

(a) IN GENERAL.—Section 1861(s)(2) (42 U.S.C. 1395x(s)(2)) is

amended, in each of subparagraphs (A) and (B), by striking ‘‘(including drugs and biologicals which cannot, as determined in accordance

with regulations, be self-administered)’’ and inserting ‘‘(including

drugs and biologicals which are not usually self-administered by

the patient)’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to drugs and biologicals administered on or after the

date of the enactment of this Act.

SEC. 113. ELIMINATION OF TIME LIMITATION ON MEDICARE BENEFITS

FOR IMMUNOSUPPRESSIVE DRUGS.

(a) IN GENERAL.—Section 1861(s)(2)(J) (42 U.S.C. 1395x(s)(2)(J))

is amended by striking ‘‘, but only’’ and all that follows up to

the semicolon at the end.

(b) CONFORMING AMENDMENTS.—

(1) EXTENDED COVERAGE.—Section 1832 (42 U.S.C. 1395k)

is amended—

(A) by striking subsection (b); and

(B) by redesignating subsection (c) as subsection (b).

(2) PASS-THROUGH; REPORT.—Section 227 of BBRA is

amended by striking subsection (d).

(c) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to drugs furnished on or after the date of the enactment

of this Act.

SEC. 114. IMPOSITION OF BILLING LIMITS ON DRUGS.

(a) IN GENERAL.—Section 1842(o) (42 U.S.C. 1395u(o)) is

amended by adding at the end the following new paragraph:

‘‘(3)(A) Payment for a charge for any drug or biological for

which payment may be made under this part may be made only

on an assignment-related basis.

114 STAT. 2763A–474 PUBLIC LAW 106–554—APPENDIX F

‘‘(B) The provisions of subsection (b)(18)(B) shall apply to

charges for such drugs or biologicals in the same manner as they

apply to services furnished by a practitioner described in subsection

(b)(18)(C).’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to items furnished on or after January 1, 2001.

SEC. 115. WAIVER OF 24-MONTH WAITING PERIOD FOR MEDICARE COVERAGE OF INDIVIDUALS DISABLED WITH AMYOTROPHIC

LATERAL SCLEROSIS (ALS).

(a) IN GENERAL.—Section 226 (42 U.S.C. 426) is amended— (1) by redesignating subsection (h) as subsection ( j) and

by moving such subsection to the end of the section; and

(2) by inserting after subsection (g) the following new subsection:

‘‘(h) For purposes of applying this section in the case of an

individual medically determined to have amyotrophic lateral sclerosis (ALS), the following special rules apply: ‘‘(1) Subsection (b) shall be applied as if there were no

requirement for any entitlement to benefits, or status, for a

period longer than 1 month. ‘‘(2) The entitlement under such subsection shall begin

with the first month (rather than twenty-fifth month) of entitlement or status. ‘‘(3) Subsection (f ) shall not be applied.’’. (b) CONFORMING AMENDMENT.—Section 1837 (42 U.S.C. 1395p)

is amended by adding at the end the following new subsection:

‘‘( j) In applying this section in the case of an individual who

is entitled to benefits under part A pursuant to the operation

of section 226(h), the following special rules apply:

‘‘(1) The initial enrollment period under subsection (d) shall

begin on the first day of the first month in which the individual

satisfies the requirement of section 1836(1).

‘‘(2) In applying subsection (g)(1), the initial enrollment

period shall begin on the first day of the first month of entitlement to disability insurance benefits referred to in such subsection.’’.

(c) EFFECTIVE DATE.—The amendments made by this section

shall apply to benefits for months beginning July 1, 2001.

Subtitle C—Demonstration Projects and

Studies

SEC. 121. DEMONSTRATION PROJECT FOR DISEASE MANAGEMENT FOR

SEVERELY CHRONICALLY ILL MEDICARE BENEFICIARIES.

(a) IN GENERAL.—The Secretary of Health and Human Services

shall conduct a demonstration project under this section (in this

section referred to as the ‘‘project’’) to demonstrate the impact

on costs and health outcomes of applying disease management

to medicare beneficiaries with diagnosed, advanced-stage congestive

heart failure, diabetes, or coronary heart disease. In no case may

the number of participants in the project exceed 30,000 at any

time.

(b) VOLUNTARY PARTICIPATION.—

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–475

(1) ELIGIBILITY.—Medicare beneficiaries are eligible to

participate in the project only if—

(A) they meet specific medical criteria demonstrating

the appropriate diagnosis and the advanced nature of their

disease;

(B) their physicians approve of participation in the

project; and

(C) they are not enrolled in a Medicare+Choice plan.

(2) BENEFITS.—A beneficiary who is enrolled in the project

shall be eligible—

(A) for disease management services related to their

chronic health condition; and

(B) for payment for all costs for prescription drugs

without regard to whether or not they relate to the chronic

health condition, except that the project may provide for

modest cost-sharing with respect to prescription drug coverage.

(c) CONTRACTS WITH DISEASE MANAGEMENT ORGANIZATIONS.—

(1) IN GENERAL.—The Secretary of Health and Human

Services shall carry out the project through contracts with

up to three disease management organizations. The Secretary

shall not enter into such a contract with an organization unless

the organization demonstrates that it can produce improved

health outcomes and reduce aggregate medicare expenditures

consistent with paragraph (2).

(2) CONTRACT PROVISIONS.—Under such contracts—

(A) such an organization shall be required to provide

for prescription drug coverage described in subsection

(b)(2)(B);

(B) such an organization shall be paid a fee negotiated

and established by the Secretary in a manner so that

(taking into account savings in expenditures under parts

A and B of the medicare program under title XVIII of

the Social Security Act) there will be a net reduction in

expenditures under the medicare program as a result of

the project; and

(C) such an organization shall guarantee, through an

appropriate arrangement with a reinsurance company or

otherwise, the net reduction in expenditures described in

subparagraph (B).

(3) PAYMENTS.—Payments to such organizations shall be

made in appropriate proportion from the Trust Funds established under title XVIII of the Social Security Act.

(d) APPLICATION OF MEDIGAP PROTECTIONS TO DEMONSTRATION

PROJECT ENROLLEES.—(1) Subject to paragraph (2), the provisions

of section 1882(s)(3) (other than clauses (i) through (iv) of subparagraph (B)) and 1882(s)(4) of the Social Security Act shall apply

to enrollment (and termination of enrollment) in the demonstration

project under this section, in the same manner as they apply

to enrollment (and termination of enrollment) with a

Medicare+Choice organization in a Medicare+Choice plan.

(2) In applying paragraph (1)—

(A) any reference in clause (v) or (vi) of section 1882(s)(3)(B)

of such Act to 12 months is deemed a reference to the period

of the demonstration project; and

114 STAT. 2763A–476 PUBLIC LAW 106–554—APPENDIX F

(B) the notification required under section 1882(s)(3)(D)

of such Act shall be provided in a manner specified by the

Secretary of Health and Human Services.

(e) DURATION.—The project shall last for not longer than 3

years.

(f ) WAIVER.—The Secretary of Health and Human Services

shall waive such provisions of title XVIII of the Social Security

Act as may be necessary to provide for payment for services under

the project in accordance with subsection (c)(3).

(g) REPORT.—The Secretary of Health and Human Services

shall submit to Congress an interim report on the project not

later than 2 years after the date it is first implemented and a

final report on the project not later than 6 months after the date

of its completion. Such reports shall include information on the

impact of the project on costs and health outcomes and recommendations on the cost-effectiveness of extending or expanding the project.

SEC. 122. CANCER PREVENTION AND TREATMENT DEMONSTRATION

FOR ETHNIC AND RACIAL MINORITIES.

(a) DEMONSTRATION.—

(1) IN GENERAL.—The Secretary of Health and Human

Services (in this section referred to as the ‘‘Secretary’’) shall

conduct demonstration projects (in this section referred to as

‘‘demonstration projects’’) for the purpose of developing models

and evaluating methods that—

(A) improve the quality of items and services provided

to target individuals in order to facilitate reduced disparities in early detection and treatment of cancer;

(B) improve clinical outcomes, satisfaction, quality of

life, and appropriate use of medicare-covered services and

referral patterns among those target individuals with cancer;

(C) eliminate disparities in the rate of preventive cancer screening measures, such as pap smears and prostate

cancer screenings, among target individuals; and

(D) promote collaboration with community-based

organizations to ensure cultural competency of health care

professionals and linguistic access for persons with limited

English proficiency.

(2) TARGET INDIVIDUAL DEFINED.—In this section, the term

‘‘target individual’’ means an individual of a racial and ethnic

minority group, as defined by section 1707 of the Public Health

Service Act, who is entitled to benefits under part A, and

enrolled under part B, of title XVIII of the Social Security

Act.

(b) PROGRAM DESIGN.—

(1) INITIAL DESIGN.—Not later than 1 year after the date

of the enactment of this Act, the Secretary shall evaluate best

practices in the private sector, community programs, and academic research of methods that reduce disparities among

individuals of racial and ethnic minority groups in the prevention and treatment of cancer and shall design the demonstration

projects based on such evaluation.

(2) NUMBER AND PROJECT AREAS.—Not later than 2 years

after the date of the enactment of this Act, the Secretary

shall implement at least nine demonstration projects, including

the following:

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–477

(A) Two projects for each of the four following major

racial and ethnic minority groups:

(i) American Indians, including Alaska Natives,

Eskimos, and Aleuts.

(ii) Asian Americans and Pacific Islanders.

(iii) Blacks.

(iv) Hispanics.

The two projects must target different ethnic subpopulations.

(B) One project within the Pacific Islands.

(C) At least one project each in a rural area and

inner-city area.

(3) EXPANSION OF PROJECTS; IMPLEMENTATION OF DEMONSTRATION PROJECT RESULTS.—If the initial report under subsection (c) contains an evaluation that demonstration projects—

(A) reduce expenditures under the medicare program

under title XVIII of the Social Security Act; or

(B) do not increase expenditures under the medicare

program and reduce racial and ethnic health disparities

in the quality of health care services provided to target

individuals and increase satisfaction of beneficiaries and

health care providers;

the Secretary shall continue the existing demonstration projects

and may expand the number of demonstration projects.

(c) REPORT TO CONGRESS.—

(1) IN GENERAL.—Not later than 2 years after the date

the Secretary implements the initial demonstration projects,

and biannually thereafter, the Secretary shall submit to Congress a report regarding the demonstration projects.

(2) CONTENTS OF REPORT.—Each report under paragraph

(1) shall include the following:

(A) A description of the demonstration projects.

(B) An evaluation of—

(i) the cost-effectiveness of the demonstration

projects;

(ii) the quality of the health care services provided

to target individuals under the demonstration projects;

and

(iii) beneficiary and health care provider satisfaction under the demonstration projects.

(C) Any other information regarding the demonstration

projects that the Secretary determines to be appropriate.

(d) WAIVER AUTHORITY.—The Secretary shall waive compliance

with the requirements of title XVIII of the Social Security Act

to such extent and for such period as the Secretary determines

is necessary to conduct demonstration projects.

(e) FUNDING.—

(1) DEMONSTRATION PROJECTS.—

(A) STATE PROJECTS.—Except as provided in subparagraph (B), the Secretary shall provide for the transfer

from the Federal Hospital Insurance Trust Fund and the

Federal Supplementary Insurance Trust Fund under title

XVIII of the Social Security Act, in such proportions as

the Secretary determines to be appropriate, of such funds

as are necessary for the costs of carrying out the demonstration projects.

114 STAT. 2763A–478 PUBLIC LAW 106–554—APPENDIX F

(B) TERRITORY PROJECTS.—In the case of a demonstration project described in subsection (b)(2)(B), amounts shall

be available only as provided in any Federal law making

appropriations for the territories.

(2) LIMITATION.—In conducting demonstration projects, the

Secretary shall ensure that the aggregate payments made by

the Secretary do not exceed the sum of the amount which

the Secretary would have paid under the program for the

prevention and treatment of cancer if the demonstration

projects were not implemented, plus $25,000,000.

SEC. 123. STUDY ON MEDICARE COVERAGE OF ROUTINE THYROID

SCREENING.

(a) STUDY.—The Secretary of Health and Human Services shall

request the National Academy of Sciences, and as appropriate in

conjunction with the United States Preventive Services Task Force,

to conduct a study on the addition of coverage of routine thyroid

screening using a thyroid stimulating hormone test as a preventive

benefit provided to medicare beneficiaries under title XVIII of the

Social Security Act for some or all medicare beneficiaries. In

conducting the study, the Academy shall consider the short-term

and long-term benefits, and costs to the medicare program, of

such addition.

(b) REPORT.—Not later than 2 years after the date of the

enactment of this Act, the Secretary of Health and Human Services

shall submit a report on the findings of the study conducted under

subsection (a) to the Committee on Ways and Means and the

Committee on Commerce of the House of Representatives and the

Committee on Finance of the Senate.

SEC. 124. MEDPAC STUDY ON CONSUMER COALITIONS.

(a) STUDY.—The Medicare Payment Advisory Commission shall

conduct a study that examines the use of consumer coalitions in

the marketing of Medicare+Choice plans under the medicare program under title XVIII of the Social Security Act. The study shall

examine—

(1) the potential for increased efficiency in the medicare

program through greater beneficiary knowledge of their health

care options, decreased marketing costs of Medicare+Choice

organizations, and creation of a group market;

(2) the implications of Medicare+Choice plans and medicare

supplemental policies (under section 1882 of the Social Security

Act (42 U.S.C. 1395ss)) offering medicare beneficiaries in the

same geographic location different benefits and premiums based

on their affiliation with a consumer coalition;

(3) how coalitions should be governed, how they should

be accountable to the Secretary of Health and Human Services,

and how potential conflicts of interest in the activities of consumer coalitions should be avoided; and

(4) how such coalitions should be funded.

(b) REPORT.—Not later than 1 year after the date of the enactment of this Act, the Commission shall submit to Congress a report

on the study conducted under subsection (a). The report shall

include a recommendation on whether and how a demonstration

project might be conducted for the operation of consumer coalitions

under the medicare program.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–479

(c) CONSUMER COALITION DEFINED.—For purposes of this section, the term ‘‘consumer coalition’’ means a nonprofit, communitybased group of organizations that— (1) provides information to medicare beneficiaries about

their health care options under the medicare program; and

(2) negotiates benefits and premiums for medicare beneficiaries who are members or otherwise affiliated with the

group of organizations with Medicare+Choice organizations

offering Medicare+Choice plans, issuers of medicare supplemental policies, issuers of long-term care coverage, and pharmacy benefit managers.

SEC. 125. STUDY ON LIMITATION ON STATE PAYMENT FOR MEDICARE

COST-SHARING AFFECTING ACCESS TO SERVICES FOR

QUALIFIED MEDICARE BENEFICIARIES.

(a) IN GENERAL.—The Secretary of Health and Human Services

shall conduct a study to determine if access to certain services

(including mental health services) for qualified medicare beneficiaries has been affected by limitations on a State’s payment

for medicare cost-sharing for such beneficiaries under section

1902(n) of the Social Security Act (42 U.S.C. 1396a(n)). As part

of such study, the Secretary shall analyze the effect of such payment

limitation on providers who serve a disproportionate share of such

beneficiaries.

(b) REPORT.—Not later than 1 year after the date of the enactment of this Act, the Secretary shall submit to Congress a report

on the study under subsection (a). The report shall include recommendations regarding any changes that should be made to the

State payment limits under section 1902(n) for qualified medicare

beneficiaries to ensure appropriate access to services.

SEC. 126. STUDIES ON PREVENTIVE INTERVENTIONS IN PRIMARY CARE

FOR OLDER AMERICANS.

(a) STUDIES.—The Secretary of Health and Human Services,

acting through the United States Preventive Services Task Force,

shall conduct a series of studies designed to identify preventive

interventions that can be delivered in the primary care setting

and that are most valuable to older Americans.

(b) MISSION STATEMENT.—The mission statement of the United

States Preventive Services Task Force is amended to include the

evaluation of services that are of particular relevance to older

Americans.

(c) REPORT.—Not later than 1 year after the date of the enactment of this Act, and annually thereafter, the Secretary of Health

and Human Services shall submit to Congress a report on the

conclusions of the studies conducted under subsection (a), together

with recommendations for such legislation and administrative

actions as the Secretary considers appropriate.

SEC. 127. MEDPAC STUDY AND REPORT ON MEDICARE COVERAGE OF

CARDIAC AND PULMONARY REHABILITATION THERAPY

SERVICES.

(a) STUDY.—

(1) IN GENERAL.—The Medicare Payment Advisory Commission shall conduct a study on coverage of cardiac and pulmonary

rehabilitation therapy services under the medicare program

under title XVIII of the Social Security Act.

114 STAT. 2763A–480 PUBLIC LAW 106–554—APPENDIX F

(2) FOCUS.—In conducting the study under paragraph (1),

the Commission shall focus on the appropriate—

(A) qualifying diagnoses required for coverage of cardiac and pulmonary rehabilitation therapy services;

(B) level of physician direct involvement and supervision in furnishing such services; and

(C) level of reimbursement for such services.

(b) REPORT.—Not later than 18 months after the date of the

enactment of this Act, the Commission shall submit to Congress

a report on the study conducted under subsection (a) together

with such recommendations for legislation and administrative

action as the Commission determines appropriate.

SEC. 128. LIFESTYLE MODIFICATION PROGRAM DEMONSTRATION.

(a) IN GENERAL.—The Secretary of Health and Human Services

shall carry out the demonstration project known as the Lifestyle

Modification Program Demonstration, as described in the Health

Care Financing Administration Memorandum of Understanding

entered into on November 13, 2000, and as subsequently modified,

(in this section referred to as the ‘‘project’’) in accordance with

the following requirements:

(1) The project shall include no fewer than 1,800 medicare

beneficiaries who complete under the project the entire course

of treatment under the Lifestyle Modification Program.

(2) The project shall be conducted over a course of 4 years.

(b) STUDY ON COST-EFFECTIVENESS.—

(1) STUDY.—The Secretary shall conduct a study on the

cost-effectiveness of the Lifestyle Modification Program as conducted under the project. In determining whether such Program

is cost-effective, the Secretary shall determine (using a control

group under a matched paired experimental design) whether

expenditures incurred for medicare beneficiaries enrolled under

the project exceed expenditures for the control group of medicare beneficiaries with similar health conditions who are not

enrolled under the project.

(2) REPORTS.—

(A) INITIAL REPORT.—Not later that 1 year after the

date on which 900 medicare beneficiaries have completed

the entire course of treatment under the Lifestyle Modification Program under the project, the Secretary shall submit

to Congress an initial report on the study conducted under

paragraph (1).

(B) FINAL REPORT.—Not later that 1 year after the

date on which 1,800 medicare beneficiaries have completed

the entire course of treatment under such Program under

the project, the Secretary shall submit to Congress a final

report on the study conducted under paragraph (1).

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–481

TITLE II—RURAL HEALTH CARE

IMPROVEMENTS

Subtitle A—Critical Access Hospital

Provisions

SEC. 201. CLARIFICATION OF NO BENEFICIARY COST-SHARING FOR

CLINICAL DIAGNOSTIC LABORATORY TESTS FURNISHED

BY CRITICAL ACCESS HOSPITALS.

(a) PAYMENT CLARIFICATION.—Section 1834(g) (42 U.S.C.

1395m(g)) is amended by adding at the end the following new

paragraph:

‘‘(4) NO BENEFICIARY COST-SHARING FOR CLINICAL DIAGNOSTIC LABORATORY SERVICES.—No coinsurance, deductible,

copayment, or other cost-sharing otherwise applicable under

this part shall apply with respect to clinical diagnostic laboratory services furnished as an outpatient critical access hospital

service. Nothing in this title shall be construed as providing

for payment for clinical diagnostic laboratory services furnished

as part of outpatient critical access hospital services, other

than on the basis described in this subsection.’’.

(b) TECHNICAL AND CONFORMING AMENDMENTS.—

(1) Paragraphs (1)(D)(i) and (2)(D)(i) of section 1833(a) (42

U.S.C. 1395l(a)) are each amended by striking ‘‘or which are

furnished on an outpatient basis by a critical access hospital’’.

(2) Section 403(d)(2) of BBRA (113 Stat. 1501A–371) is

amended by striking ‘‘The amendment made by subsection (a)

shall apply’’ and inserting ‘‘Paragraphs (1) through (3) of section

1834(g) of the Social Security Act (as amended by paragraph

(1)) apply’’.

(c) EFFECTIVE DATES.—The amendment made—

(1) by subsection (a) shall apply to services furnished on

or after the date of the enactment of BBRA;

(2) by subsection (b)(1) shall apply as if included in the

enactment of section 403(e)(1) of BBRA (113 Stat. 1501A–371);

and

(3) by subsection (b)(2) shall apply as if included in the

enactment of section 403(d)(2) of BBRA (113 Stat. 1501A–

371).

SEC. 202. ASSISTANCE WITH FEE SCHEDULE PAYMENT FOR PROFESSIONAL SERVICES UNDER ALL-INCLUSIVE RATE.

(a) IN GENERAL.—Section 1834(g)(2)(B) (42 U.S.C.

1395m(g)(2)(B)) is amended by inserting ‘‘115 percent of’’ before

‘‘such amounts’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply with respect to items and services furnished on or

after July 1, 2001.

SEC. 203. EXEMPTION OF CRITICAL ACCESS HOSPITAL SWING BEDS

FROM SNF PPS.

(a) IN GENERAL.—Section 1888(e)(7) (42 U.S.C. 1395yy(e)(7))

is amended—

(1) in the heading, by striking ‘‘TRANSITION FOR’’ and inserting ‘‘TREATMENT OF’’;

114 STAT. 2763A–482 PUBLIC LAW 106–554—APPENDIX F

(2) in subparagraph (A), by striking ‘‘IN GENERAL.—The’’ and inserting ‘‘TRANSITION.—Subject to subparagraph (C), the’’;

(3) in subparagraph (A), by inserting ‘‘(other than critical

access hospitals)’’ after ‘‘facilities described in subparagraph

(B)’’;

(4) in subparagraph (B), by striking ‘‘, for which payment’’

and all that follows before the period; and

(5) by adding at the end the following new subparagraph:

‘‘(C) EXEMPTION FROM PPS OF SWING-BED SERVICES FUR- NISHED IN CRITICAL ACCESS HOSPITALS.—The prospective

payment system established under this subsection shall

not apply to services furnished by a critical access hospital

pursuant to an agreement under section 1883.’’. (b) PAYMENT ON A REASONABLE COST BASIS FOR SWING BED

SERVICES FURNISHED BY CRITICAL ACCESS HOSPITALS.—Section

1883(a) (42 U.S.C. 1395tt(a)) is amended— (1) in paragraph (2)(A), by inserting ‘‘(other than a critical

access hospital)’’ after ‘‘any hospital’’; and

(2) by adding at the end the following new paragraph: ‘‘(3) Notwithstanding any other provision of this title, a critical

access hospital shall be paid for covered skilled nursing facility

services furnished under an agreement entered into under this

section on the basis of the reasonable costs of such services (as

determined under section 1861(v)).’’. (c) EFFECTIVE DATE.—The amendments made by this section

shall apply to cost reporting periods beginning on or after the

date of the enactment of this Act.

SEC. 204. PAYMENT IN CRITICAL ACCESS HOSPITALS FOR EMERGENCY

ROOM ON-CALL PHYSICIANS.

(a) IN GENERAL.—Section 1834(g) (42 U.S.C. 1395m(g)), as

amended by section 201(a), is further amended by adding at the

end the following new paragraph:

‘‘(5) COVERAGE OF COSTS FOR EMERGENCY ROOM ON-CALL

PHYSICIANS.—In determining the reasonable costs of outpatient

critical access hospital services under paragraphs (1) and (2)(A),

the Secretary shall recognize as allowable costs, amounts (as

defined by the Secretary) for reasonable compensation and

related costs for emergency room physicians who are on-call

(as defined by the Secretary) but who are not present on the

premises of the critical access hospital involved, and are not

otherwise furnishing physicians’ services and are not on-call

at any other provider or facility.’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to cost reporting periods beginning on or after October

1, 2001.

SEC. 205. TREATMENT OF AMBULANCE SERVICES FURNISHED BY CERTAIN CRITICAL ACCESS HOSPITALS.

(a) IN GENERAL.—Section 1834(l) (42 U.S.C. 1395m(l)) is amended by adding at the end the following new paragraph: ‘‘(8) SERVICES FURNISHED BY CRITICAL ACCESS HOSPITALS.—

Notwithstanding any other provision of this subsection, the

Secretary shall pay the reasonable costs incurred in furnishing

ambulance services if such services are furnished—

‘‘(A) by a critical access hospital (as defined in section

1861(mm)(1)), or

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–483

‘‘(B) by an entity that is owned and operated by a

critical access hospital,

but only if the critical access hospital or entity is the only

provider or supplier of ambulance services that is located within

a 35-mile drive of such critical access hospital.’’.

(b) CONFORMING AMENDMENT.—Section 1833(a)(1)(R) (42 U.S.C.

1395l(a)(1)(R)) is amended— (1) by striking ‘‘ambulance service,’’ and inserting ‘‘ambulance services, (i)’’; and

(2) by inserting before the comma at the end the following: ‘‘and (ii) with respect to ambulance services described in section

1834(l)(8), the amounts paid shall be the amounts determined

under section 1834(g) for outpatient critical access hospital

services’’. (c) EFFECTIVE DATE.—The amendments made by this section

shall apply to services furnished on or after the date of the enactment of this Act.

SEC. 206. GAO STUDY ON CERTAIN ELIGIBILITY REQUIREMENTS FOR

CRITICAL ACCESS HOSPITALS.

(a) STUDY.—The Comptroller General of the United States shall

conduct a study on the eligibility requirements for critical access

hospitals under section 1820(c) of the Social Security Act (42 U.S.C.

1395i–4(c)) with respect to limitations on average length of stay

and number of beds in such a hospital, including an analysis of—

(1) the feasibility of having a distinct part unit as part

of a critical access hospital for purposes of the medicare program under title XVIII of such Act; and

(2) the effect of seasonal variations in patient admissions

on critical access hospital eligibility requirements with respect

to limitations on average annual length of stay and number

of beds.

(b) REPORT.—Not later than 1 year after the date of the enactment of this Act, the Comptroller General shall submit to Congress

a report on the study conducted under subsection (a) together

with recommendations regarding—

(1) whether distinct part units should be permitted as

part of a critical access hospital under the medicare program;

(2) if so permitted, the payment methodologies that should

apply with respect to services provided by such units;

(3) whether, and to what extent, such units should be

included in or excluded from the bed limits applicable to critical

access hospitals under the medicare program; and

(4) any adjustments to such eligibility requirements to

account for seasonal variations in patient admissions.

Subtitle B—Other Rural Hospitals

Provisions

SEC. 211. TREATMENT OF RURAL DISPROPORTIONATE SHARE HOSPITALS.

(a) APPLICATION OF UNIFORM THRESHOLD.—Section

1886(d)(5)(F)(v) (42 U.S.C. 1395ww(d)(5)(F)(v)) is amended—

(1) in subclause (II), by inserting ‘‘(or 15 percent, for discharges occurring on or after April 1, 2001)’’ after ‘‘30 percent’’;

114 STAT. 2763A–484 PUBLIC LAW 106–554—APPENDIX F

(2) in subclause (III), by inserting ‘‘(or 15 percent, for

discharges occurring on or after April 1, 2001)’’ after ‘‘40 percent’’; and

(3) in subclause (IV), by inserting ‘‘(or 15 percent, for discharges occurring on or after April 1, 2001)’’ after ‘‘45 percent’’.

(b) ADJUSTMENT OF PAYMENT FORMULAS.—

(1) SOLE COMMUNITY HOSPITALS.—Section 1886(d)(5)(F) (42

U.S.C. 1395ww(d)(5)(F)) is amended—

(A) in clause (iv)(VI), by inserting after ‘‘10 percent’’

the following: ‘‘or, for discharges occurring on or after April

1, 2001, is equal to the percent determined in accordance

with clause (x)’’; and

(B) by adding at the end the following new clause:

‘‘(x) For purposes of clause (iv)(VI) (relating to sole community

hospitals), in the case of a hospital for a cost reporting period

with a disproportionate patient percentage (as defined in clause

(vi)) that—

‘‘(I) is less than 19.3, the disproportionate share adjustment

percentage is determined in accordance with the following formula: (P–15)(.65) + 2.5;

‘‘(II) is equal to or exceeds 19.3, but is less than 30.0,

such adjustment percentage is equal to 5.25 percent; or

‘‘(III) is equal to or exceeds 30, such adjustment percentage

is equal to 10 percent,

where ‘P’ is the hospital’s disproportionate patient percentage (as

defined in clause (vi)).’’.

(2) RURAL REFERRAL CENTERS.—Such section is further

amended—

(A) in clause (iv)(V), by inserting after ‘‘clause (viii)’’

the following: ‘‘or, for discharges occurring on or after April

1, 2001, is equal to the percent determined in accordance

with clause (xi)’’; and

(B) by adding at the end the following new clause:

‘‘(xi) For purposes of clause (iv)(V) (relating to rural referral

centers), in the case of a hospital for a cost reporting period with

a disproportionate patient percentage (as defined in clause (vi))

that—

‘‘(I) is less than 19.3, the disproportionate share adjustment

percentage is determined in accordance with the following formula: (P–15)(.65) + 2.5;

‘‘(II) is equal to or exceeds 19.3, but is less than 30.0,

such adjustment percentage is equal to 5.25 percent; or

‘‘(III) is equal to or exceeds 30, such adjustment percentage

is determined in accordance with the following formula: (P–

30)(.6) + 5.25,

where ‘P’ is the hospital’s disproportionate patient percentage (as

defined in clause (vi)).’’.

(3) SMALL RURAL HOSPITALS GENERALLY.—Such section is

further amended—

(A) in clause (iv)(III), by inserting after ‘‘4 percent’’

the following: ‘‘or, for discharges occurring on or after April

1, 2001, is equal to the percent determined in accordance

with clause (xii)’’; and

(B) by adding at the end the following new clause:

‘‘(xii) For purposes of clause (iv)(III) (relating to small rural

hospitals generally), in the case of a hospital for a cost reporting

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–485

period with a disproportionate patient percentage (as defined in

clause (vi)) that— ‘‘(I) is less than 19.3, the disproportionate share adjustment

percentage is determined in accordance with the following formula: (P–15)(.65) + 2.5; or

‘‘(II) is equal to or exceeds 19.3, such adjustment percentage

is equal to 5.25 percent,

where ‘P’ is the hospital’s disproportionate patient percentage (as

defined in clause (vi)).’’.

(4) HOSPITALS THAT ARE BOTH SOLE COMMUNITY HOSPITALS

AND RURAL REFERRAL CENTERS.—Such section is further amended, in clause (iv)(IV), by inserting after ‘‘clause (viii)’’ the following: ‘‘or, for discharges occurring on or after April 1, 2001,

the greater of the percentages determined under clause (x)

or (xi)’’. (5) URBAN HOSPITALS WITH LESS THAN 100 BEDS.—Such

section is further amended— (A) in clause (iv)(II), by inserting after ‘‘5 percent’’ the following: ‘‘or, for discharges occurring on or after April

1, 2001, is equal to the percent determined in accordance

with clause (xiii)’’; and

(B) by adding at the end the following new clause: ‘‘(xiii) For purposes of clause (iv)(II) (relating to urban hospitals

with less than 100 beds), in the case of a hospital for a cost

reporting period with a disproportionate patient percentage (as

defined in clause (vi)) that— ‘‘(I) is less than 19.3, the disproportionate share adjustment

percentage is determined in accordance with the following formula: (P–15)(.65) + 2.5; or

‘‘(II) is equal to or exceeds 19.3, such adjustment percentage

is equal to 5.25 percent,

where ‘P’ is the hospital’s disproportionate patient percentage (as

defined in clause (vi)).’’.

SEC. 212. OPTION TO BASE ELIGIBILITY FOR MEDICARE DEPENDENT,

SMALL RURAL HOSPITAL PROGRAM ON DISCHARGES

DURING TWO OF THE THREE MOST RECENTLY AUDITED

COST REPORTING PERIODS.

(a) IN GENERAL.—Section 1886(d)(5)(G)(iv)(IV) (42 U.S.C.

1395ww(d)(5)(G)(iv)(IV)) is amended by inserting ‘‘, or two of the

three most recently audited cost reporting periods for which the

Secretary has a settled cost report,’’ after ‘‘1987’’.

(b) EFFECTIVE DATE.—The amendment made by this section

shall apply with respect to cost reporting periods beginning on

or after April 1, 2001.

SEC. 213. EXTENSION OF OPTION TO USE REBASED TARGET AMOUNTS

TO ALL SOLE COMMUNITY HOSPITALS.

(a) IN GENERAL.—Section 1886(b)(3)(I)(i) (42 U.S.C.

1395ww(b)(3)(I)(i)) is amended—

(1) in the matter preceding subclause (I), by striking ‘‘that

for its cost reporting period beginning during 1999’’ and all

that follows through ‘‘for such target amount’’ and inserting

‘‘there shall be substituted for the amount otherwise determined

under subsection (d)(5)(D)(i), if such substitution results in

a greater amount of payment under this section for the hospital’’;

114 STAT. 2763A–486 PUBLIC LAW 106–554—APPENDIX F

(2) in subclause (I), by striking ‘‘target amount otherwise

applicable’’ and all that follows through ‘‘target amount’)’’ and

inserting ‘‘the amount otherwise applicable to the hospital

under subsection (d)(5)(D)(i) (referred to in this clause as the

‘subsection (d)(5)(D)(i) amount’)’’; and

(3) in each of subclauses (II) and (III), by striking ‘‘subparagraph (C) target amount’’ and inserting ‘‘subsection (d)(5)(D)(i)

amount’’.

(b) EFFECTIVE DATE.—The amendments made by this section

shall take effect as if included in the enactment of section 405

of BBRA (113 Stat. 1501A–372).

SEC. 214. MEDPAC ANALYSIS OF IMPACT OF VOLUME ON PER UNIT

COST OF RURAL HOSPITALS WITH PSYCHIATRIC UNITS.

The Medicare Payment Advisory Commission, in its study conducted pursuant to subsection (a) of section 411 of BBRA (113

Stat. 1501A–377), shall include—

(1) in such study an analysis of the impact of volume

on the per unit cost of rural hospitals with psychiatric units;

and

(2) in its report under subsection (b) of such section a

recommendation on whether special treatment for such hospitals may be warranted.

Subtitle C—Other Rural Provisions

SEC. 221. ASSISTANCE FOR PROVIDERS OF AMBULANCE SERVICES IN

RURAL AREAS.

(a) TRANSITIONAL ASSISTANCE IN CERTAIN MILEAGE RATES.—

Section 1834(l) (42 U.S.C. 1395m(l)) is amended by adding at the

end the following new paragraph:

‘‘(8) TRANSITIONAL ASSISTANCE FOR RURAL PROVIDERS.—In

the case of ground ambulance services furnished on or after

July 1, 2001, and before January 1, 2004, for which the

transportation originates in a rural area (as defined in section

1886(d)(2)(D)) or in a rural census tract of a metropolitan

statistical area (as determined under the most recent modification of the Goldsmith Modification, originally published in the

Federal Register on February 27, 1992 (57 Fed. Reg. 6725)),

the fee schedule established under this subsection shall provide

that, with respect to the payment rate for mileage for a trip

above 17 miles, and up to 50 miles, the rate otherwise established shall be increased by not less than 1⁄2 of the additional

payment per mile established for the first 17 miles of such

a trip originating in a rural area.’’.

(b) GAO STUDIES ON THE COSTS OF AMBULANCE SERVICES FURNISHED IN RURAL AREAS.—

(1) STUDY.—The Comptroller General of the United States

shall conduct a study on each of the matters described in

paragraph (2).

(2) MATTERS DESCRIBED.—The matters referred to in paragraph (1) are the following:

(A) The cost of efficiently providing ambulance services

for trips originating in rural areas, with special emphasis

on collection of cost data from rural providers.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–487

(B) The means by which rural areas with low population densities can be identified for the purpose of designating areas in which the cost of providing ambulance

services would be expected to be higher than similar services provided in more heavily populated areas because of

low usage. Such study shall also include an analysis of

the additional costs of providing ambulance services in

areas designated under the previous sentence.

(3) REPORT.—Not later than June 30, 2002, the Comptroller

General shall submit to Congress a report on the results of

the studies conducted under paragraph (1) and shall include

recommendations on steps that should be taken to assure access

to ambulance services in rural areas.

(c) ADJUSTMENT IN RURAL RATES.—In providing for adjustments

under subparagraph (D) of section 1834(l)(2) of the Social Security

Act (42 U.S.C. 1395m(l)(2)) for years beginning with 2004, the

Secretary of Health and Human Services shall take into consideration the recommendations contained in the report under subsection

(b)(2) and shall adjust the fee schedule payment rates under such

section for ambulance services provided in low density rural areas

based on the increased cost (if any) of providing such services

in such areas.

(d) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to services furnished on or after July 1, 2001. In applying

such amendment to services furnished on or after such date and

before January 1, 2002, the amount of the rate increase provided

under such amendment shall be equal to $1.25 per mile.

SEC. 222. PAYMENT FOR CERTAIN PHYSICIAN ASSISTANT SERVICES.

(a) PAYMENT FOR CERTAIN PHYSICIAN ASSISTANT SERVICES.— Section 1842(b)(6)(C) (42 U.S.C. 1395u(b)(6)(C)) is amended— (1) by striking ‘‘for such services provided before January

1, 2003,’’; and

(2) by striking the semicolon at the end and inserting

a comma.

(b) EFFECTIVE DATE.—The amendments made by subsection

(a) shall take effect on the date of the enactment of this Act.

SEC. 223. REVISION OF MEDICARE REIMBURSEMENT FOR TELEHEALTH SERVICES.

(a) TIME LIMIT FOR BBA PROVISION.—Section 4206(a) of BBA

(42 U.S.C. 1395l note) is amended by striking ‘‘Not later than

January 1, 1999’’ and inserting ‘‘For services furnished on and

after January 1, 1999, and before October 1, 2001’’. (b) EXPANSION OF MEDICARE PAYMENT FOR TELEHEALTH SERV- ICES.—Section 1834 (42 U.S.C. 1395m) is amended by adding at

the end the following new subsection: ‘‘(m) PAYMENT FOR TELEHEALTH SERVICES.— ‘‘(1) IN GENERAL.—The Secretary shall pay for telehealth

services that are furnished via a telecommunications system

by a physician (as defined in section 1861(r)) or a practitioner

(described in section 1842(b)(18)(C)) to an eligible telehealth

individual enrolled under this part notwithstanding that the

individual physician or practitioner providing the telehealth

service is not at the same location as the beneficiary. For

purposes of the preceding sentence, in the case of any Federal

telemedicine demonstration program conducted in Alaska or

Hawaii, the term ‘telecommunications system’ includes storeVerDate 27-APR-2000 07:52 Feb 16, 2001 Jkt 089139 PO 00000 Frm 00489 Fmt 6580 Sfmt 6581 W:\PUBLAW\PUBL554.106 ofrpc45 PsN: ofrpc45
114 STAT. 2763A–488 PUBLIC LAW 106–554—APPENDIX F

and-forward technologies that provide for the asynchronous

transmission of health care information in single or multimedia

formats. ‘‘(2) PAYMENT AMOUNT.— ‘‘(A) DISTANT SITE.—The Secretary shall pay to a physician or practitioner located at a distant site that furnishes

a telehealth service to an eligible telehealth individual

an amount equal to the amount that such physician or

practitioner would have been paid under this title had

such service been furnished without the use of a telecommunications system. ‘‘(B) FACILITY FEE FOR ORIGINATING SITE.—With respect

to a telehealth service, subject to section 1833(a)(1)(U),

there shall be paid to the originating site a facility fee

equal to—

‘‘(i) for the period beginning on October 1, 2001, and ending on December 31, 2001, and for 2002, $20;

and ‘‘(ii) for a subsequent year, the facility fee specified

in clause (i) or this clause for the preceding year

increased by the percentage increase in the MEI (as

defined in section 1842(i)(3)) for such subsequent year.

‘‘(C) TELEPRESENTER NOT REQUIRED.—Nothing in this

subsection shall be construed as requiring an eligible telehealth individual to be presented by a physician or practitioner at the originating site for the furnishing of a service

via a telecommunications system, unless it is medically

necessary (as determined by the physician or practitioner

at the distant site).

‘‘(3) LIMITATION ON BENEFICIARY CHARGES.—

‘‘(A) PHYSICIAN AND PRACTITIONER.—The provisions of

section 1848(g) and subparagraphs (A) and (B) of section

1842(b)(18) shall apply to a physician or practitioner receiving payment under this subsection in the same manner

as they apply to physicians or practitioners under such

sections.

‘‘(B) ORIGINATING SITE.—The provisions of section

1842(b)(18) shall apply to originating sites receiving a facility fee in the same manner as they apply to practitioners

under such section.

‘‘(4) DEFINITIONS.—For purposes of this subsection:

‘‘(A) DISTANT SITE.—The term ‘distant site’ means the

site at which the physician or practitioner is located at

the time the service is provided via a telecommunications

system.

‘‘(B) ELIGIBLE TELEHEALTH INDIVIDUAL.—The term

‘eligible telehealth individual’ means an individual enrolled

under this part who receives a telehealth service furnished

at an originating site.

‘‘(C) ORIGINATING SITE.—

‘‘(i) IN GENERAL.—The term ‘originating site’ means

only those sites described in clause (ii) at which the

eligible telehealth individual is located at the time

the service is furnished via a telecommunications system and only if such site is located—

‘‘(I) in an area that is designated as a rural

health professional shortage area under section

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–489

332(a)(1)(A) of the Public Health Service Act (42

U.S.C. 254e(a)(1)(A));

‘‘(II) in a county that is not included in a

Metropolitan Statistical Area; or

‘‘(III) from an entity that participates in a

Federal telemedicine demonstration project that

has been approved by (or receives funding from)

the Secretary of Health and Human Services as

of December 31, 2000.

‘‘(ii) SITES DESCRIBED.—The sites referred to in

clause (i) are the following sites:

‘‘(I) The office of a physician or practitioner.

‘‘(II) A critical access hospital (as defined in

section 1861(mm)(1)).

‘‘(III) A rural health clinic (as defined in section 1861(aa)(s)).

‘‘(IV) A Federally qualified health center (as

defined in section 1861(aa)(4)).

‘‘(V) A hospital (as defined in section 1861(e)).

‘‘(D) PHYSICIAN.—The term ‘physician’ has the meaning

given that term in section 1861(r).

‘‘(E) PRACTITIONER.—The term ‘practitioner’ has the

meaning given that term in section 1842(b)(18)(C).

‘‘(F) TELEHEALTH SERVICE.—

‘‘(i) IN GENERAL.—The term ‘telehealth service’

means professional consultations, office visits, and

office psychiatry services (identified as of July 1, 2000,

by HCPCS codes 99241–99275, 99201–99215, 90804–

90809, and 90862 (and as subsequently modified by

the Secretary)), and any additional service specified

by the Secretary.

‘‘(ii) YEARLY UPDATE.—The Secretary shall establish a process that provides, on an annual basis, for

the addition or deletion of services (and HCPCS codes),

as appropriate, to those specified in clause (i) for

authorized payment under paragraph (1).’’.

(c) CONFORMING AMENDMENT.—Section 1833(a)(1) (42 U.S.C.

1395l(1)), as amended by section 105(c), is further amended—

(1) by striking ‘‘and (T)’’ and inserting ‘‘(T)’’; and

(2) by inserting before the semicolon at the end the following: ‘‘, and (U) with respect to facility fees described in section

1834(m)(2)(B), the amounts paid shall be 80 percent of the

lesser of the actual charge or the amounts specified in such

section’’.

(d) STUDY AND REPORT ON ADDITIONAL COVERAGE.—

(1) STUDY.—The Secretary of Health and Human Services

shall conduct a study to identify—

(A) settings and sites for the provision of telehealth

services that are in addition to those permitted under

section 1834(m) of the Social Security Act, as added by

subsection (b);

(B) practitioners that may be reimbursed under such

section for furnishing telehealth services that are in addition to the practitioners that may be reimbursed for such

services under such section; and

114 STAT. 2763A–490 PUBLIC LAW 106–554—APPENDIX F

(C) geographic areas in which telehealth services may

be reimbursed that are in addition to the geographic areas

where such services may be reimbursed under such section.

(2) REPORT.—Not later than 2 years after the date of the

enactment of this Act, the Secretary shall submit to Congress

a report on the study conducted under paragraph (1) together

with such recommendations for legislation that the Secretary

determines are appropriate.

(e) EFFECTIVE DATE.—The amendments made by subsections

(b) and (c) shall be effective for services furnished on or after

October 1, 2001.

SEC. 224. EXPANDING ACCESS TO RURAL HEALTH CLINICS.

(a) IN GENERAL.—The matter in section 1833(f ) (42 U.S.C.

1395l(f )) preceding paragraph (1) is amended by striking ‘‘rural

hospitals’’ and inserting ‘‘hospitals’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to services furnished on or after July 1, 2001.

SEC. 225. MEDPAC STUDY ON LOW-VOLUME, ISOLATED RURAL HEALTH

CARE PROVIDERS.

(a) STUDY.—The Medicare Payment Advisory Commission shall

conduct a study on the effect of low patient and procedure volume

on the financial status of low-volume, isolated rural health care

providers participating in the medicare program under title XVIII

of the Social Security Act.

(b) REPORT.—Not later than 18 months after the date of the

enactment of this Act, the Commission shall submit to Congress

a report on the study conducted under subsection (a) indicating—

(1) whether low-volume, isolated rural health care providers

are having, or may have, significantly decreased medicare margins or other financial difficulties resulting from any of the

payment methodologies described in subsection (c);

(2) whether the status as a low-volume, isolated rural

health care provider should be designated under the medicare

program and any criteria that should be used to qualify for

such a status; and

(3) any changes in the payment methodologies described

in subsection (c) that are necessary to provide appropriate

reimbursement under the medicare program to low-volume,

isolated rural health care providers (as designated pursuant

to paragraph (2)).

(c) PAYMENT METHODOLOGIES DESCRIBED.—The payment methodologies described in this subsection are the following:

(1) The prospective payment system for hospital outpatient

department services under section 1833(t) of the Social Security

Act (42 U.S.C. 1395l(t)).

(2) The fee schedule for ambulance services under section

1834(l) of such Act (42 U.S.C. 1395m(l)).

(3) The prospective payment system for inpatient hospital

services under section 1886 of such Act (42 U.S.C. 1395ww).

(4) The prospective payment system for routine service

costs of skilled nursing facilities under section 1888(e) of such

Act (42 U.S.C. 1395yy(e)).

(5) The prospective payment system for home health services under section 1895 of such Act (42 U.S.C. 1395fff ).

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–491

TITLE III—PROVISIONS RELATING TO

PART A

Subtitle A—Inpatient Hospital Services

SEC. 301. REVISION OF ACUTE CARE HOSPITAL PAYMENT UPDATE

FOR 2001.

(a) IN GENERAL.—Section 1886(b)(3)(B)(i) (42 U.S.C.

1395ww(b)(3)(B)(i)) is amended—

(1) in subclause (XVI), by striking ‘‘minus 1.1 percentage

points for hospitals (other than sole community hospitals) in

all areas, and the market basket percentage increase for sole

community hospitals,’’ and inserting ‘‘for hospitals in all areas,’’;

(2) in subclause (XVII)—

(A) by striking ‘‘minus 1.1 percentage points’’ and

inserting ‘‘minus 0.55 percentage points; and

(B) by striking ‘‘and’’ at the end;

(3) by redesignating subclause (XVIII) as subclause (XIX);

(4) in subclause (XIX), as so redesignated, by striking ‘‘fiscal

year 2003’’ and inserting ‘‘fiscal year 2004’’; and

(5) by inserting after subclause (XVII) the following new

subclause:

‘‘(XVIII) for fiscal year 2003, the market basket percentage

increase minus 0.55 percentage points for hospitals in all areas,

and’’.

(b) SPECIAL RULE FOR PAYMENT FOR FISCAL YEAR 2001.—Notwithstanding the amendment made by subsection (a), for purposes

of making payments for fiscal year 2001 for inpatient hospital

services furnished by subsection (d) hospitals (as defined in section

1886(d)(1)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(1)(B)),

the ‘‘applicable percentage increase’’ referred to in section

1886(b)(3)(B)(i) of such Act (42 U.S.C. 1395ww(b)(3)(B)(i))—

(1) for discharges occurring on or after October 1, 2000,

and before April 1, 2001, shall be determined in accordance

with subclause (XVI) of such section as in effect on the day

before the date of the enactment of this Act; and

(2) for discharges occurring on or after April 1, 2001, and

before October 1, 2001, shall be equal to—

(A) the market basket percentage increase plus 1.1

percentage points for hospitals (other than sole community

hospitals) in all areas; and

(B) the market basket percentage increase for sole

community hospitals.

(c) CONSIDERATION OF PRICE OF BLOOD AND BLOOD PRODUCTS

IN MARKET BASKET INDEX.—The Secretary of Health and Human

Services shall, when next (after the date of the enactment of this

Act) rebasing and revising the hospital market basket index (as

defined in section 1886(b)(3)(B)(iii) of the Social Security Act (42

U.S.C. 1395ww(b)(3)(B)(iii))), consider the prices of blood and blood

products purchased by hospitals and determine whether those prices

are adequately reflected in such index.

(d) MEDPAC STUDY AND REPORT REGARDING CERTAIN HOSPITAL

COSTS.—

(1) STUDY.—The Medicare Payment Advisory Commission

shall conduct a study on—

114 STAT. 2763A–492 PUBLIC LAW 106–554—APPENDIX F

(A) any increased costs incurred by subsection (d) hospitals (as defined in paragraph (1)(B) of section 1886(d)

of the Social Security Act (42 U.S.C. 1395ww(d))) in providing inpatient hospital services to medicare beneficiaries

under title XVIII of such Act during the period beginning

on October 1, 1983, and ending on September 30, 1999,

that were attributable to—

(i) complying with new blood safety measure

requirements; and

(ii) providing such services using new technologies;

(B) the extent to which the prospective payment system

for such services under such section provides adequate

and timely recognition of such increased costs;

(C) the prospects for (and to the extent practicable,

the magnitude of ) cost increases that hospitals will incur

in providing such services that are attributable to complying with new blood safety measure requirements and

providing such services using new technologies during the

10 years after the date of the enactment of this Act; and

(D) the feasibility and advisability of establishing

mechanisms under such payment system to provide for

more timely and accurate recognition of such cost increases

in the future.

(2) CONSULTATION.—In conducting the study under this

subsection, the Commission shall consult with representatives

of the blood community, including—

(A) hospitals;

(B) organizations involved in the collection, processing,

and delivery of blood; and

(C) organizations involved in the development of new

blood safety technologies.

(3) REPORT.—Not later than 1 year after the date of the

enactment of this Act, the Commission shall submit to Congress

a report on the study conducted under paragraph (1) together

with such recommendations for legislation and administrative

action as the Commission determines appropriate.

(e) ADJUSTMENT FOR INPATIENT CASE MIX CHANGES.—

(1) IN GENERAL.—Section 1886(d)(3)(A) (42 U.S.C.

1395ww(d)(3)(A)) is amended by adding at the end the following

new clause:

‘‘(vi) Insofar as the Secretary determines that the adjustments under paragraph (4)(C)(i) for a previous fiscal year (or

estimates that such adjustments for a future fiscal year) did

(or are likely to) result in a change in aggregate payments

under this subsection during the fiscal year that are a result

of changes in the coding or classification of discharges that

do not reflect real changes in case mix, the Secretary may

adjust the average standardized amounts computed under this

paragraph for subsequent fiscal years so as to eliminate the

effect of such coding or classification changes.’’.

(2) EFFECTIVE DATE.—The amendment made by paragraph

(1) shall apply to discharges occurring on or after October

1, 2001.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–493

SEC. 302. ADDITIONAL MODIFICATION IN TRANSITION FOR INDIRECT

MEDICAL EDUCATION (IME) PERCENTAGE ADJUSTMENT.

(a) IN GENERAL.—Section 1886(d)(5)(B)(ii) (42 U.S.C.

1395ww(d)(5)(B)(ii)) is amended—

(1) in subclause (V) by striking ‘‘and’’ at the end;

(2) by redesignating subclause (VI) as subclause (VII);

(3) in subclause (VII) as so redesignated, by striking ‘‘2001’’

and inserting ‘‘2002’’; and

(4) by inserting after subclause (V) the following new subclause:

‘‘(VI) during fiscal year 2002, ‘c’ is equal to 1.6; and’’.

(b) SPECIAL RULE FOR PAYMENT FOR FISCAL YEAR 2001.—Notwithstanding paragraph (5)(B)(ii)(V) of section 1886(d) of the Social

Security Act (42 U.S.C. 1395ww(d)(5)(B)(ii)(V)), for purposes of making payments for subsection (d) hospitals (as defined in paragraph

(1)(B) of such section) with indirect costs of medical education,

the indirect teaching adjustment factor referred to in paragraph

(5)(B)(ii) of such section shall be determined, for discharges occurring on or after April 1, 2001, and before October 1, 2001, as

if ‘‘c’’ in paragraph (5)(B)(ii)(V) of such section equalled 1.66 rather

than 1.54.

(c) CONFORMING AMENDMENT RELATING TO DETERMINATION OF

STANDARDIZED AMOUNT.—Section 1886(d)(2)(C)(i) (42 U.S.C.

1395ww(d)(2)(C)(i)) is amended by inserting ‘‘or of section 302 of

the Medicare, Medicaid, and SCHIP Benefits Improvement and

Protection Act of 2000’’ after ‘‘Balanced Budget Refinement Act

of 1999’’.

(d) CLERICAL AMENDMENTS.—Section 1886(d)(5)(B) (42 U.S.C.

1395ww(d)(5)(B)), as amended by subsection (a), is further amended

by moving the indentation of each of the following 2 ems to the

left:

(1) Clauses (ii), (v), and (vi).

(2) Subclauses (I) (II), (III), (IV), (V), and (VII) of clause

(ii).

(3) Subclauses (I) and (II) of clause (vi) and the flush

sentence at the end of such clause.

SEC. 303. DECREASE IN REDUCTIONS FOR DISPROPORTIONATE SHARE

HOSPITAL (DSH) PAYMENTS.

(a) IN GENERAL.—Section 1886(d)(5)(F)(ix) (42 U.S.C.

1395ww(d)(5)(F)(ix)) is amended—

(1) in subclause (III), by striking ‘‘each of’’ and by inserting

‘‘and 2 percent, respectively’’ after ‘‘3 percent’’; and

(2) in subclause (IV), by striking ‘‘4 percent’’ and inserting

‘‘3 percent’’.

(b) SPECIAL RULE FOR PAYMENT FOR FISCAL YEAR 2001.—Notwithstanding the amendment made by subsection (a)(1), for purposes of making disproportionate share payments for subsection

(d) hospitals (as defined in section 1886(d)(1)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(1)(B)) for fiscal year 2001, the additional payment amount otherwise determined under clause (ii) of

section 1886(d)(5)(F) of the Social Security Act (42 U.S.C.

1395ww(d)(5)(F))—

(1) for discharges occurring on or after October 1, 2000,

and before April 1, 2001, shall be adjusted as provided by

clause (ix)(III) of such section as in effect on the day before

the date of the enactment of this Act; and

114 STAT. 2763A–494 PUBLIC LAW 106–554—APPENDIX F

(2) for discharges occurring on or after April 1, 2001, and

before October 1, 2001, shall, instead of being reduced by 3

percent as provided by clause (ix)(III) of such section as in

effect after the date of the enactment of this Act, be reduced

by 1 percent.

(c) CONFORMING AMENDMENTS RELATING TO DETERMINATION

OF STANDARDIZED AMOUNT.—Section 1886(d)(2)(C)(iv) (42 U.S.C.

1395ww(d)(2)(C)(iv)), is amended— (1) by striking ‘‘1989 or’’ and inserting ‘‘1989,’’; and

(2) by inserting ‘‘, or the enactment of section 303 of the

Medicare, Medicaid, and SCHIP Benefits Improvement and

Protection Act of 2000’’ after ‘‘Omnibus Budget Reconciliation

Act of 1990’’. (d) TECHNICAL AMENDMENT.— (1) IN GENERAL.—Section 1886(d)(5)(F)(i) (42 U.S.C.

1395ww(d)(5)(F)(i)) is amended by striking ‘‘and before October

1, 1997,’’. (2) EFFECTIVE DATE.—The amendment made by paragraph

(1) is effective as if included in the enactment of BBA.

(e) REFERENCE TO CHANGES IN DSH FOR RURAL HOSPITALS.—

For additional changes in the DSH program for rural hospitals,

see section 211.

SEC. 304. WAGE INDEX IMPROVEMENTS.

(a) DURATION OF WAGE INDEX RECLASSIFICATION; USE OF 3-

YEAR WAGE DATA.—Section 1886(d)(10)(D) (42 U.S.C.

1395ww(d)(10)(D)) is amended by adding at the end the following

new clauses:

‘‘(v) Any decision of the Board to reclassify a subsection (d)

hospital for purposes of the adjustment factor described in subparagraph (C)(i)(II) for fiscal year 2001 or any fiscal year thereafter

shall be effective for a period of 3 fiscal years, except that the

Secretary shall establish procedures under which a subsection (d)

hospital may elect to terminate such reclassification before the

end of such period. ‘‘(vi) Such guidelines shall provide that, in making decisions

on applications for reclassification for the purposes described in

clause (v) for fiscal year 2003 and any succeeding fiscal year,

the Board shall base any comparison of the average hourly wage

for the hospital with the average hourly wage for hospitals in

an area on—

‘‘(I) an average of the average hourly wage amount for

the hospital from the most recently published hospital wage

survey data of the Secretary (as of the date on which the

hospital applies for reclassification) and such amount from

each of the two immediately preceding surveys; and

‘‘(II) an average of the average hourly wage amount for

hospitals in such area from the most recently published hospital

wage survey data of the Secretary (as of the date on which

the hospital applies for reclassification) and such amount from

each of the two immediately preceding surveys.’’.

(b) PROCESS TO PERMIT STATEWIDE WAGE INDEX CALCULATION

AND APPLICATION.—

(1) IN GENERAL.—The Secretary of Health and Human

Services shall establish a process (based on the voluntary process utilized by the Secretary of Health and Human Services

under section 1848 of the Social Security Act (42 U.S.C. 1395w–

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–495

4) for purposes of computing and applying a statewide

geographic adjustment factor) under which an appropriate

statewide entity may apply to have all the geographic areas

in a State treated as a single geographic area for purposes

of computing and applying the area wage index under section

1886(d)(3)(E) of such Act (42 U.S.C. 1395ww(d)(3)(E)). Such

process shall be established by October 1, 2001, for reclassifications beginning in fiscal year 2003.

(2) PROHIBITION ON INDIVIDUAL HOSPITAL RECLASSIFICA- TION.—Notwithstanding any other provision of law, if the Secretary applies a statewide geographic wage index under paragraph (1) with respect to a State, any application submitted

by a hospital in that State under section 1886(d)(10) of the

Social Security Act (42 U.S.C. 1395ww(d)(10)) for geographic

reclassification shall not be considered.

(c) COLLECTION OF INFORMATION ON OCCUPATIONAL MIX.— (1) IN GENERAL.—The Secretary of Health and Human

Services shall provide for the collection of data every 3 years

on occupational mix for employees of each subsection (d) hospital (as defined in section 1886(d)(1)(D) of the Social Security

Act (42 U.S.C. 1395ww(d)(1)(D))) in the provision of inpatient

hospital services, in order to construct an occupational mix

adjustment in the hospital area wage index applied under

section 1886(d)(3)(E) of such Act (42 U.S.C. 1395ww(d)(3)(E)).

(2) APPLICATION.—The third sentence of section

1886(d)(3)(E) (42 U.S.C. 1395ww(d)(3)(E)) is amended by striking ‘‘To the extent determined feasible by the Secretary, such

survey shall measure’’ and inserting ‘‘Not less often than once

every 3 years the Secretary (through such survey or otherwise)

shall measure’’.

(3) EFFECTIVE DATE.—By not later than September 30,

2003, for application beginning October 1, 2004, the Secretary

shall first complete—

(A) the collection of data under paragraph (1); and

(B) the measurement under the third sentence of section 1886(d)(3)(E), as amended by paragraph (2).

SEC. 305. PAYMENT FOR INPATIENT SERVICES OF REHABILITATION

HOSPITALS.

(a) ASSISTANCE WITH ADMINISTRATIVE COSTS ASSOCIATED WITH

COMPLETION OF PATIENT ASSESSMENT.—Section 1886( j)(3)(B) (42

U.S.C. 1395ww( j)(3)(B)) is amended by striking ‘‘98 percent’’ and

inserting ‘‘98 percent for fiscal year 2001 and 100 percent for

fiscal year 2002’’.

(b) ELECTION TO APPLY FULL PROSPECTIVE PAYMENT RATE

WITHOUT PHASE-IN.—

(1) IN GENERAL.—Paragraph (1) of section 1886( j) (42

U.S.C. 1395ww( j)) is amended—

(A) in subparagraph (A), by inserting ‘‘other than a

facility making an election under subparagraph (F)’’ before

‘‘in a cost reporting period’’;

(B) in subparagraph (B), by inserting ‘‘or, in the case

of a facility making an election under subparagraph (F),

for any cost reporting period described in such subparagraph,’’ after ‘‘2002,’’; and

(C) by adding at the end the following new subparagraph:

114 STAT. 2763A–496 PUBLIC LAW 106–554—APPENDIX F

‘‘(F) ELECTION TO APPLY FULL PROSPECTIVE PAYMENT

SYSTEM.—A rehabilitation facility may elect, not later than

30 days before its first cost reporting period for which

the payment methodology under this subsection applies

to the facility, to have payment made to the facility under

this subsection under the provisions of subparagraph (B)

(rather than subparagraph (A)) for each cost reporting

period to which such payment methodology applies.’’. (2) CLARIFICATION.—Paragraph (3)(B) of such section is

amended by inserting ‘‘but not taking into account any payment

adjustment resulting from an election permitted under paragraph (1)(F)’’ after ‘‘paragraphs (4) and (6)’’. (c) EFFECTIVE DATE.—The amendments made by this section

take effect as if included in the enactment of BBA.

SEC. 306. PAYMENT FOR INPATIENT SERVICES OF PSYCHIATRIC HOSPITALS.

With respect to hospitals described in clause (i) of section

1886(d)(1)(B) of the Social Security Act (42 U.S.C. 1395ww(d)(1)(B))

and psychiatric units described in the matter following clause (v)

of such section, in making incentive payments to such hospitals

under section 1886(b)(1)(A) of such Act (42 U.S.C. 1395ww(b)(1)(A))

for cost reporting periods beginning on or after October 1, 2000,

and before October 1, 2001, the Secretary of Health and Human

Services, in clause (ii) of such section, shall substitute ‘‘3 percent’’ for ‘‘2 percent’’.

SEC. 307. PAYMENT FOR INPATIENT SERVICES OF LONG-TERM CARE

HOSPITALS.

(a) INCREASED TARGET AMOUNTS AND CAPS FOR LONG-TERM

CARE HOSPITALS BEFORE IMPLEMENTATION OF THE PROSPECTIVE

PAYMENT SYSTEM.— (1) IN GENERAL.—Section 1886(b)(3) (42 U.S.C.

1395ww(b)(3)) is amended— (A) in subparagraph (H)(ii)(III), by inserting ‘‘subject

to subparagraph (J),’’ after ‘‘2002,’’; and

(B) by adding at the end the following new subparagraph: ‘‘(J) For cost reporting periods beginning during fiscal year

2001, for a hospital described in subsection (d)(1)(B)(iv)— ‘‘(i) the limiting or cap amount otherwise determined under

subparagraph (H) shall be increased by 2 percent; and ‘‘(ii) the target amount otherwise determined under

subparagraph (A) shall be increased by 25 percent (subject

to the limiting or cap amount determined under subparagraph

(H), as increased by clause (i)).’’. (2) APPLICATION.—The amendments made by subsection

(a) and by section 122 of BBRA (113 Stat. 1501A–331) shall

not be taken into account in the development and implementation of the prospective payment system under section 123 of

BBRA (113 Stat. 1501A–331).

(b) IMPLEMENTATION OF PROSPECTIVE PAYMENT SYSTEM FOR

LONG-TERM CARE HOSPITALS.—

(1) MODIFICATION OF REQUIREMENT.—In developing the

prospective payment system for payment for inpatient hospital

services provided in long-term care hospitals described in section 1886(d)(1)(B)(iv) of the Social Security Act (42 U.S.C.

1395ww(d)(1)(B)(iv)) under the medicare program under title

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–497

XVIII of such Act required under section 123 of BBRA, the

Secretary of Health and Human Services shall examine the

feasibility and the impact of basing payment under such a

system on the use of existing (or refined) hospital diagnosisrelated groups (DRGs) that have been modified to account

for different resource use of long-term care hospital patients

as well as the use of the most recently available hospital

discharge data. The Secretary shall examine and may provide

for appropriate adjustments to the long-term hospital payment

system, including adjustments to DRG weights, area wage

adjustments, geographic reclassification, outliers, updates, and

a disproportionate share adjustment consistent with section

1886(d)(5)(F) of the Social Security Act (42 U.S.C.

1395ww(d)(5)(F)).

(2) DEFAULT IMPLEMENTATION OF SYSTEM BASED ON EXIST- ING DRG METHODOLOGY.—If the Secretary is unable to implement the prospective payment system under section 123 of

the BBRA by October 1, 2002, the Secretary shall implement

a prospective payment system for such hospitals that bases

payment under such a system using existing hospital diagnosisrelated groups (DRGs), modified where feasible to account for

resource use of long-term care hospital patients using the most

recently available hospital discharge data for such services

furnished on or after that date.

Subtitle B—Adjustments to PPS Payments

for Skilled Nursing Facilities

SEC. 311. ELIMINATION OF REDUCTION IN SKILLED NURSING FACILITY

(SNF) MARKET BASKET UPDATE IN 2001.

(a) IN GENERAL.—Section 1888(e)(4)(E)(ii) (42 U.S.C.

1395yy(e)(4)(E)(ii)) is amended—

(1) by redesignating subclauses (II) and (III) as subclauses

(III) and (IV), respectively;

(2) in subclause (III), as so redesignated—

(A) by striking ‘‘each of fiscal years 2001 and 2002’’

and inserting ‘‘each of fiscal years 2002 and 2003’’; and

(B) by striking ‘‘minus 1 percentage point’’ and inserting ‘‘minus 0.5 percentage points’’; and

(3) by inserting after subclause (I) the following new subclause:

‘‘(II) for fiscal year 2001, the rate computed

for the previous fiscal year increased by the skilled

nursing facility market basket percentage change

for the fiscal year;’’.

(b) SPECIAL RULE FOR PAYMENT FOR FISCAL YEAR 2001.—Notwithstanding the amendments made by subsection (a), for purposes

of making payments for covered skilled nursing facility services

under section 1888(e) of the Social Security Act (42 U.S.C.

1395yy(e)) for fiscal year 2001, the Federal per diem rate referred

to in paragraph (4)(E)(ii) of such section—

(1) for the period beginning on October 1, 2000, and ending

on March 31, 2001, shall be the rate determined in accordance

with the law as in effect on the day before the date of the

enactment of this Act; and

114 STAT. 2763A–498 PUBLIC LAW 106–554—APPENDIX F

(2) for the period beginning on April 1, 2001, and ending

on September 30, 2001, shall be the rate that would have

been determined under such section if ‘‘plus 1 percentage point’’

had been substituted for ‘‘minus 1 percentage point’’ under

subclause (II) of such paragraph (as in effect on the day before

the date of the enactment of this Act).

(c) RELATION TO TEMPORARY INCREASE IN BBRA.—The

increases provided under section 101 of BBRA (113 Stat. 1501A–

325) shall be in addition to any increase resulting from the amendments made by subsection (a).

(d) GAO REPORT ON ADEQUACY OF SNF PAYMENT RATES.—

Not later than July 1, 2002, the Comptroller General of the United

States shall submit to Congress a report on the adequacy of medicare payment rates to skilled nursing facilities and the extent

to which medicare contributes to the financial viability of such

facilities. Such report shall take into account the role of private

payors, medicaid, and case mix on the financial performance of

these facilities, and shall include an analysis (by specific RUG

classification) of the number and characteristics of such facilities.

(e) HCFA STUDY OF CLASSIFICATION SYSTEMS FOR SNF RESIDENTS.—

(1) STUDY.—The Secretary of Health and Human Services

shall conduct a study of the different systems for categorizing

patients in medicare skilled nursing facilities in a manner

that accounts for the relative resource utilization of different

patient types.

(2) REPORT.—Not later than January 1, 2005, the Secretary

shall submit to Congress a report on the study conducted under

subsection (a). Such report shall include such recommendations

regarding changes in law as may be appropriate.

SEC. 312. INCREASE IN NURSING COMPONENT OF PPS FEDERAL RATE.

(a) IN GENERAL.—The Secretary of Health and Human Services

shall increase by 16.66 percent the nursing component of the casemix adjusted Federal prospective payment rate specified in Tables

3 and 4 of the final rule published in the Federal Register by

the Health Care Financing Administration on July 31, 2000 (65

Fed. Reg. 46770) and as subsequently updated, effective for services

furnished on or after April 1, 2001, and before October 1, 2002.

(b) GAO AUDIT OF NURSING STAFF RATIOS.—

(1) AUDIT.—The Comptroller General of the United States

shall conduct an audit of nursing staffing ratios in a representative sample of medicare skilled nursing facilities. Such sample

shall cover selected States and shall include broad representation with respect to size, ownership, location, and medicare

volume. Such audit shall include an examination of payroll

records and medicaid cost reports of individual facilities.

(2) REPORT.—Not later than August 1, 2002, the Comptroller General shall submit to Congress a report on the audits

conducted under paragraph (1). Such report shall include an

assessment of the impact of the increased payments under

this subtitle on increased nursing staff ratios and shall make

recommendations as to whether increased payments under subsection (a) should be continued.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–499

SEC. 313. APPLICATION OF SNF CONSOLIDATED BILLING REQUIREMENT LIMITED TO PART A COVERED STAYS.

(a) IN GENERAL.—Section 1862(a)(18) (42 U.S.C. 1395y(a)(18))

is amended by striking ‘‘or of a part of a facility that includes

a skilled nursing facility (as determined under regulations),’’ and

inserting ‘‘during a period in which the resident is provided covered

post-hospital extended care services (or, for services described in

section 1861(s)(2)(D), which are furnished to such an individual

without regard to such period),’’.

(b) CONFORMING AMENDMENTS.—(1) Section 1842(b)(6)(E) (42

U.S.C. 1395u(b)(6)(E)) is amended—

(A) by inserting ‘‘by, or under arrangements made by, a

skilled nursing facility’’ after ‘‘furnished’’;

(B) by striking ‘‘or of a part of a facility that includes

a skilled nursing facility (as determined under regulations)’’;

and

(C) by striking ‘‘(without regard to whether or not the

item or service was furnished by the facility, by others under

arrangement with them made by the facility, under any other

contracting or consulting arrangement, or otherwise)’’.

(2) Section 1842(t) (42 U.S.C. 1395u(t)) is amended by striking

‘‘by a physician’’ and ‘‘or of a part of a facility that includes a

skilled nursing facility (as determined under regulations),’’.

(3) Section 1866(a)(1)(H)(ii)(I) (42 U.S.C. 1395cc(a)(1)(H)(ii)(I))

is amended by inserting after ‘‘who is a resident of the skilled

nursing facility’’ the following: ‘‘during a period in which the resident is provided covered post-hospital extended care services (or,

for services described in section 1861(s)(2)(D), that are furnished

to such an individual without regard to such period)’’.

(c) EFFECTIVE DATE.—The amendments made by subsections

(a) and (b) shall apply to services furnished on or after January

1, 2001.

(d) OVERSIGHT.—The Secretary of Health and Human Services,

through the Office of the Inspector General in the Department

of Health and Human Services or otherwise, shall monitor payments

made under part B of the title XVIII of the Social Security Act

for items and services furnished to residents of skilled nursing

facilities during a time in which the residents are not being provided

medicare covered post-hospital extended care services to ensure

that there is not duplicate billing for services or excessive services

provided.

SEC. 314. ADJUSTMENT OF REHABILITATION RUGS TO CORRECT

ANOMALY IN PAYMENT RATES.

(a) ADJUSTMENT FOR REHABILITATION RUGS.—

(1) IN GENERAL.—For purposes of computing payments for

covered skilled nursing facility services under paragraph (1)

of section 1888(e) of the Social Security Act (42 U.S.C.

1395yy(e)) for such services furnished on or after April 1, 2001,

and before the date described in section 101(c)(2) of BBRA

(113 Stat. 1501A–324), the Secretary of Health and Human

Services shall increase by 6.7 percent the adjusted Federal

per diem rate otherwise determined under paragraph (4) of

such section (but for this section) for covered skilled nursing

facility services for RUG–III rehabilitation groups described

in paragraph (2) furnished to an individual during the period

114 STAT. 2763A–500 PUBLIC LAW 106–554—APPENDIX F

in which such individual is classified in such a RUG–III category.

(2) REHABILITATION GROUPS DESCRIBED.—The RUG–III

rehabilitation groups for which the adjustment described in

paragraph (1) applies are RUC, RUB, RUA, RVC, RVB, RVA,

RHC, RHB, RHA, RMC, RMB, RMA, RLB, and RLA, as specified in Tables 3 and 4 of the final rule published in the Federal

Register by the Health Care Financing Administration on July

31, 2000 (65 Fed. Reg. 46770).

(b) CORRECTION WITH RESPECT TO REHABILITATION RUGS.—

(1) IN GENERAL.—Section 101(b) of BBRA (113 Stat. 1501A–

324) is amended by striking ‘‘CA1, RHC, RMC, and RMB’’

and inserting ‘‘and CA1’’.

(2) EFFECTIVE DATE.—The amendment made by paragraph

(1) shall apply to services furnished on or after April 1, 2001.

(c) REVIEW BY OFFICE OF INSPECTOR GENERAL.—The Inspector

General of the Department of Health and Human Services shall

review the medicare payment structure for services classified within

rehabilitation resource utilization groups (RUGs) (as in effect after

the date of the enactment of the BBRA) to assess whether payment

incentives exist for the delivery of inadequate care. Not later than

October 1, 2001, the Inspector General shall submit to Congress

a report on such review.

SEC. 315. ESTABLISHMENT OF PROCESS FOR GEOGRAPHIC RECLASSIFICATION.

(a) IN GENERAL.—The Secretary of Health and Human Services

may establish a procedure for the geographic reclassification of

a skilled nursing facility for purposes of payment for covered skilled

nursing facility services under the prospective payment system

established under section 1888(e) of the Social Security Act (42

U.S.C. 1395yy(e)). Such procedure may be based upon the method

for geographic reclassifications for inpatient hospitals established

under section 1886(d)(10) of the Social Security Act (42 U.S.C.

1395ww(d)(10)).

(b) REQUIREMENT FOR SKILLED NURSING FACILITY WAGE

DATA.—In no case may the Secretary implement the procedure

under subsection (a) before such time as the Secretary has collected

data necessary to establish an area wage index for skilled nursing

facilities based on wage data from such facilities.

Subtitle C—Hospice Care

SEC. 321. FIVE PERCENT INCREASE IN PAYMENT BASE.

(a) IN GENERAL.—Section 1814(i)(1)(C)(ii)(VI) (42 U.S.C.

1395f(i)(1)(C)(ii)(VI)) is amended by inserting ‘‘, plus, in the case

of fiscal year 2001, 5.0 percentage points’’ before the semicolon

at the end.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to hospice care furnished on or after April 1, 2001.

In applying clause (ii) of section 1814(i)(1)(C) of the Social Security

Act (42 U.S.C. 1395f(i)(1)(C)) beginning with fiscal year 2002, the

payment rates in effect under such section during the period beginning on April 1, 2001, and ending on September 30, shall be

treated as the payment rates in effect during fiscal year 2001.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–501

(c) NO EFFECT ON BBRA TEMPORARY INCREASE.—The provisions

of this section shall have no effect on the application of section

131 of BBRA.

(d) APPLICATION OF WAGE INDEX.—Notwithstanding section

1814(i) of the Social Security Act (42 U.S.C. 1395f(i)), the Secretary

of Health and Human Services shall use 1.0043 as the hospice

wage index value for the Wichita, Kansas Metropolitan Statistical

Area in calculating payments under such section for a hospice

program providing hospice care in such area during fiscal year

2000. The Secretary may provide for an appropriate timely lump

sum payment to reflect the application of the previous sentence.

(e) TECHNICAL AMENDMENT.—Section 1814(a)(7)(A)(ii) (42

U.S.C. 1395f(a)(7)(A)(ii)) is amended by striking the period at the

end and inserting a semicolon.

SEC. 322. CLARIFICATION OF PHYSICIAN CERTIFICATION.

(a) CERTIFICATION BASED ON NORMAL COURSE OF ILLNESS.—

(1) IN GENERAL.—Section 1814(a) (42 U.S.C. 1395f(a)) is

amended by adding at the end the following new sentence:

‘‘The certification regarding terminal illness of an individual

under paragraph (7) shall be based on the physician’s or medical

director’s clinical judgment regarding the normal course of the

individual’s illness.’’.

(2) EFFECTIVE DATE.—The amendment made by paragraph

(1) shall apply to certifications made on or after the date

of the enactment of this Act.

(b) STUDY AND REPORT ON PHYSICIAN CERTIFICATION REQUIREMENT FOR HOSPICE BENEFITS.—

(1) STUDY.—The Secretary of Health and Human Services

shall conduct a study to examine the appropriateness of the

certification regarding terminal illness of an individual under

section 1814(a)(7) of the Social Security Act (42 U.S.C.

1395f(a)(7)) that is required in order for such individual to

receive hospice benefits under the medicare program under

title XVIII of such Act. In conducting such study, the Secretary

shall take into account the effect of the amendment made

by subsection (a).

(2) REPORT.—Not later than 2 years after the date of the

enactment of this Act, the Secretary of Health and Human

Services shall submit to Congress a report on the study conducted under paragraph (1), together with any recommendations for legislation that the Secretary deems appropriate.

SEC. 323. MEDPAC REPORT ON ACCESS TO, AND USE OF, HOSPICE

BENEFIT.

(a) IN GENERAL.—The Medicare Payment Advisory Commission

shall conduct a study to examine the factors affecting the use

of hospice benefits under the medicare program under title XVIII

of the Social Security Act, including a delay in the time (relative

to death) of entry into a hospice program, and differences in such

use between urban and rural hospice programs and based upon

the presenting condition of the patient.

(b) REPORT.—Not later than 18 months after the date of the

enactment of this Act, the Commission shall submit to Congress

a report on the study conducted under subsection (a), together

with any recommendations for legislation that the Commission

deems appropriate.

114 STAT. 2763A–502 PUBLIC LAW 106–554—APPENDIX F

Subtitle D—Other Provisions

SEC. 331. RELIEF FROM MEDICARE PART A LATE ENROLLMENT PENALTY FOR GROUP BUY-IN FOR STATE AND LOCAL RETIREES.

(a) IN GENERAL.—Section 1818 (42 U.S.C. 1395i–2) is

amended—

(1) in subsection (c)(6), by inserting before the semicolon

at the end the following: ‘‘and shall be subject to reduction

in accordance with subsection (d)(6)’’; and

(2) by adding at the end of subsection (d) the following

new paragraph:

‘‘(6)(A) In the case where a State, a political subdivision of

a State, or an agency or instrumentality of a State or political

subdivision thereof determines to pay, for the life of each individual,

the monthly premiums due under paragraph (1) on behalf of each

of the individuals in a qualified State or local government retiree

group who meets the conditions of subsection (a), the amount of

any increase otherwise applicable under section 1839(b) (as applied

and modified by subsection (c)(6) of this section) with respect to

the monthly premium for benefits under this part for an individual

who is a member of such group shall be reduced by the total

amount of taxes paid under section 3101(b) of the Internal Revenue

Code of 1986 by such individual and under section 3111(b) by

the employers of such individual on behalf of such individual with

respect to employment (as defined in section 3121(b) of such Code).

‘‘(B) For purposes of this paragraph, the term ‘qualified State

or local government retiree group’ means all of the individuals

who retire prior to a specified date that is before January 1, 2002,

from employment in one or more occupations or other broad classes

of employees of—

‘‘(i) the State;

‘‘(ii) a political subdivision of the State; or

‘‘(iii) an agency or instrumentality of the State or political

subdivision of the State.’’.

(b) EFFECTIVE DATE.—The amendments made by subsection

(a) shall apply to premiums for months beginning with January

1, 2002.

TITLE IV—PROVISIONS RELATING TO

PART B

Subtitle A—Hospital Outpatient Services

SEC. 401. REVISION OF HOSPITAL OUTPATIENT PPS PAYMENT UPDATE.

(a) IN GENERAL.—Section 1833(t)(3)(C)(iii) (42 U.S.C.

1395l(t)(3)(C)(iii)) is amended by striking ‘‘in each of 2000, 2001,

and 2002’’ and inserting ‘‘in each of 2000 and 2002’’.

(b) ADJUSTMENT FOR CASE MIX CHANGES.—

(1) IN GENERAL.—Section 1833(t)(3)(C) (42 U.S.C.

1395l(t)(3)(C)) is amended—

(A) by redesignating clause (iii) as clause (iv); and

(B) by inserting after clause (ii) the following new

clause:

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–503

‘‘(iii) ADJUSTMENT FOR SERVICE MIX CHANGES.— Insofar as the Secretary determines that the adjustments for service mix under paragraph (2) for a previous year (or estimates that such adjustments for

a future year) did (or are likely to) result in a change

in aggregate payments under this subsection during

the year that are a result of changes in the coding

or classification of covered OPD services that do not

reflect real changes in service mix, the Secretary may

adjust the conversion factor computed under this

subparagraph for subsequent years so as to eliminate

the effect of such coding or classification changes.’’.

(2) EFFECTIVE DATE.—The amendments made by paragraph

(1) shall take effect as if included in the enactment of BBA.

(c) SPECIAL RULE FOR PAYMENT FOR 2001.—Notwithstanding

the amendment made by subsection (a), for purposes of making

payments under section 1833(t) of the Social Security Act (42 U.S.C.

1395l(t)) for covered OPD services furnished during 2001, the medicare OPD fee schedule amount under such section— (1) for services furnished on or after January 1, 2001,

and before April 1, 2001, shall be the medicare OPD fee schedule amount for 2001 as determined under the provisions of

law in effect on the day before the date of the enactment

of this Act; and

(2) for services furnished on or after April 1, 2001, and

before January 1, 2002, shall be the fee schedule amount (as

determined taking into account the amendment made by subsection (a)), increased by a transitional percentage allowance

equal to 0.32 percent (to account for the timing of implementation of the full market basket update).

SEC. 402. CLARIFYING PROCESS AND STANDARDS FOR DETERMINING

ELIGIBILITY OF DEVICES FOR PASS-THROUGH PAYMENTS UNDER HOSPITAL OUTPATIENT PPS.

(a) IN GENERAL.—Section 1833(t)(6) (42 U.S.C. 1395l(t)(6)) is

amended—

(1) by redesignating subparagraphs (C) and (D) as subparagraphs (D) and (E), respectively; and

(2) by striking subparagraph (B) and inserting the following

new subparagraphs:

‘‘(B) USE OF CATEGORIES IN DETERMINING ELIGIBILITY

OF A DEVICE FOR PASS-THROUGH PAYMENTS.—The following

provisions apply for purposes of determining whether a

medical device qualifies for additional payments under

clause (ii) or (iv) of subparagraph (A):

‘‘(i) ESTABLISHMENT OF INITIAL CATEGORIES.—

‘‘(I) IN GENERAL.—The Secretary shall initially

establish under this clause categories of medical

devices based on type of device by April 1, 2001.

Such categories shall be established in a manner

such that each medical device that meets the

requirements of clause (ii) or (iv) of subparagraph

(A) as of January 1, 2001, is included in such

a category and no such device is included in more

than one category. For purposes of the preceding

sentence, whether a medical device meets such

requirements as of such date shall be determined

114 STAT. 2763A–504 PUBLIC LAW 106–554—APPENDIX F

on the basis of the program memoranda issued

before such date. ‘‘(II) AUTHORIZATION OF IMPLEMENTATION

OTHER THAN THROUGH REGULATIONS.—The categories may be established under this clause by

program memorandum or otherwise, after consultation with groups representing hospitals,

manufacturers of medical devices, and other

affected parties.

‘‘(ii) ESTABLISHING CRITERIA FOR ADDITIONAL CAT- EGORIES.—

‘‘(I) IN GENERAL.—The Secretary shall establish criteria that will be used for creation of additional categories (other than those established

under clause (i)) through rulemaking (which may

include use of an interim final rule with comment

period). ‘‘(II) STANDARD.—Such categories shall be

established under this clause in a manner such

that no medical device is described by more than

one category. Such criteria shall include a test

of whether the average cost of devices that would

be included in a category and are in use at the

time the category is established is not insignificant, as described in subparagraph (A)(iv)(II).

‘‘(III) DEADLINE.—Criteria shall first be established under this clause by July 1, 2001. The Secretary may establish in compelling circumstances

categories under this clause before the date such

criteria are established.

‘‘(IV) ADDING CATEGORIES.—The Secretary

shall promptly establish a new category of medical

devices under this clause for any medical device

that meets the requirements of subparagraph

(A)(iv) and for which none of the categories in

effect (or that were previously in effect) is appropriate.

‘‘(iii) PERIOD FOR WHICH CATEGORY IS IN EFFECT.—

A category of medical devices established under clause

(i) or (ii) shall be in effect for a period of at least

2 years, but not more than 3 years, that begins—

‘‘(I) in the case of a category established under

clause (i), on the first date on which payment

was made under this paragraph for any device

described by such category (including payments

made during the period before April 1, 2001); and

‘‘(II) in the case of any other category, on

the first date on which payment is made under

this paragraph for any medical device that is

described by such category.

‘‘(iv) REQUIREMENTS TREATED AS MET.—A medical

device shall be treated as meeting the requirements

of subparagraph (A)(iv), regardless of whether the

device meets the requirement of subclause (I) of such

subparagraph, if—

‘‘(I) the device is described by a category established and in effect under clause (i); or

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–505

‘‘(II) the device is described by a category

established and in effect under clause (ii) and an

application under section 515 of the Federal Food,

Drug, and Cosmetic Act has been approved with

respect to the device, or the device has been cleared

for market under section 510(k) of such Act, or

the device is exempt from the requirements of

section 510(k) of such Act pursuant to subsection

(l) or (m) of section 510 of such Act or section

520(g) of such Act.

Nothing in this clause shall be construed as requiring

an application or prior approval (other than that

described in subclause (II)) in order for a covered device

described by a category to qualify for payment under

this paragraph.

‘‘(C) LIMITED PERIOD OF PAYMENT.— ‘‘(i) DRUGS AND BIOLOGICALS.—The payment under

this paragraph with respect to a drug or biological

shall only apply during a period of at least 2 years,

but not more than 3 years, that begins—

‘‘(I) on the first date this subsection is implemented in the case of a drug or biological described

in clause (i), (ii), or (iii) of subparagraph (A) and

in the case of a drug or biological described in

subparagraph (A)(iv) and for which payment under

this part is made as an outpatient hospital service

before such first date; or

‘‘(II) in the case of a drug or biological

described in subparagraph (A)(iv) not described

in subclause (I), on the first date on which payment

is made under this part for the drug or biological

as an outpatient hospital service.

‘‘(ii) MEDICAL DEVICES.—Payment shall be made

under this paragraph with respect to a medical device

only if such device— ‘‘(I) is described by a category of medical

devices established and in effect under subparagraph (B); and

‘‘(II) is provided as part of a service (or group

of services) paid for under this subsection and

provided during the period for which such category

is in effect under such subparagraph.’’.

(b) CONFORMING AMENDMENTS.—Section 1833(t) (42 U.S.C.

1395l(t)) is further amended—

(1) in paragraph (6)(A)(iv)(II), by striking ‘‘the cost of the

device, drug, or biological’’ and inserting ‘‘the cost of the drug

or biological or the average cost of the category of devices’’;

(2) in paragraph (6)(D) (as redesignated by subsection

(a)(1)), by striking ‘‘subparagraph (D)(iii)’’ in the matter preceding clause (i) and inserting ‘‘subparagraph (E)(iii)’’; and

(3) in paragraph (12)(E), by striking ‘‘additional payments

(consistent with paragraph (6)(B))’’ and inserting ‘‘additional

payments, the determination and deletion of initial and new

categories (consistent with subparagraphs (B) and (C) of paragraph (6))’’.

(c) EFFECTIVE DATE.—The amendments made by this section

take effect on the date of the enactment of this Act.

114 STAT. 2763A–506 PUBLIC LAW 106–554—APPENDIX F

(d) TRANSITION.— (1) IN GENERAL.—In the case of a medical device provided

as part of a service (or group of services) furnished during

the period before initial categories are implemented under

subparagraph (B)(i) of section 1833(t)(6) of the Social Security

Act (as amended by subsection (a)), payment shall be made

for such device under such section in accordance with the

provisions in effect before the date of the enactment of this

Act. In addition, beginning on the date that is 30 days after

the date of the enactment of this Act, payment shall be made

for such a device that is not included in a program memorandum described in such subparagraph if the Secretary of Health

and Human Services determines that the device (including

a device that would have been included in such program memoranda but for the requirement of subparagraph (A)(iv)(I) of

that section) is likely to be described by such an initial category.

(2) APPLICATION OF CURRENT PROCESS.—Notwithstanding

any other provision of law, the Secretary shall continue to

accept applications with respect to medical devices under the

process established pursuant to paragraph (6) of section 1833(t)

of the Social Security Act (as in effect on the day before the

date of the enactment of this Act) through December 1, 2000,

and any device— (A) with respect to which an application was submitted

(pursuant to such process) on or before such date; and

(B) that meets the requirements of clause (ii) or (iv)

of subparagraph (A) of such paragraph (as determined

pursuant to such process),

shall be treated as a device with respect to which an initial

category is required to be established under subparagraph (B)(i)

of such paragraph (as amended by subsection (a)(2)).

SEC. 403. APPLICATION OF OPD PPS TRANSITIONAL CORRIDOR PAYMENTS TO CERTAIN HOSPITALS THAT DID NOT SUBMIT

A 1996 COST REPORT.

(a) IN GENERAL.—Section 1833(t)(7)(F)(ii)(I) (42 U.S.C.

1395l(t)(7)(F)(ii)(I)) is amended by inserting ‘‘(or in the case of

a hospital that did not submit a cost report for such period, during

the first subsequent cost reporting period ending before 2001 for

which the hospital submitted a cost report)’’ after ‘‘1996’’. (b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall take effect as if included in the enactment of BBRA.

SEC. 404. APPLICATION OF RULES FOR DETERMINING PROVIDERBASED STATUS FOR CERTAIN ENTITIES.

(a) GRANDFATHER.—Notwithstanding any other provision of

law, effective October 1, 2000, for purposes of provider-based status

under title XVIII of the Social Security Act— (1) any facility or organization that is treated as providerbased in relation to a hospital or critical access hospital under

such title as of such date shall continue to be treated as

provider-based in relation to such hospital or critical access

hospital under such title until October 1, 2002; and

(2) the requirements, limitations, and exclusions specified

in subsections (d), (e), (f ), and (h) of section 413.65 of title

42, Code of Federal Regulations, shall not apply to such facility

or organization in relation to such hospital or critical access

hospital until October 1, 2002.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–507

(b) CONTINUING CRITERIA FOR MEETING GEOGRAPHIC LOCATION

REQUIREMENT.—Except as provided in subsection (a), in making

determinations of provider-based status on or after October 1, 2000,

the following rules shall apply:

(1) The facility or organization shall be treated as satisfying

any requirements and standards for geographic location in relation to a hospital or a critical access hospital if the facility

or organization—

(A) satisfies the requirements of section 413.65(d)(7)

of title 42, Code of Federal Regulations; or

(B) is located not more than 35 miles from the main

campus of the hospital or critical access hospital.

(2) The facility or organization shall be treated as satisfying

any of the requirements and standards for geographic location

in relation to a hospital or a critical access hospital if the

facility or organization is owned and operated by a hospital

or critical access hospital that—

(A) is owned or operated by a unit of State or local

government, is a public or private nonprofit corporation

that is formally granted governmental powers by a unit

of State or local government, or is a private hospital that

has a contract with a State or local government that

includes the operation of clinics located off the main campus

of the hospital to assure access in a well-defined service

area to health care services for low-income individuals

who are not entitled to benefits under title XVIII (or medical assistance under a State plan under title XIX) of the

Social Security Act; and

(B) has a disproportionate share adjustment percentage

(as determined under section 1886(d)(5)(F) of such Act (42

U.S.C. 1395ww(d)(5)(F))) greater than 11.75 percent or is

described in clause (i)(II) of such section.

(c) TEMPORARY CRITERIA.—For purposes of title XVIII of the

Social Security Act, a facility or organization for which a determination of provider-based status in relation to a hospital or critical

access hospital is requested on or after October 1, 2000, and before

October 1, 2002, shall be treated as having provider-based status

in relation to such a hospital or a critical access hospital for any

period before a determination is made with respect to such status

pursuant to such request.

(d) DEFINITIONS.—For purposes of this section, the terms ‘‘hospital’’ and ‘‘critical access hospital’’ have the meanings given such

terms in subsections (e) and (mm)(1), respectively, of section 1861

of the Social Security Act (42 U.S.C. 1395x).

SEC. 405. TREATMENT OF CHILDREN’S HOSPITALS UNDER PROSPECTIVE PAYMENT SYSTEM.

(a) IN GENERAL.—Section 1833(t) (42 U.S.C. 1395l(t)) is

amended—

(1) in the heading of paragraph (7)(D)(ii), by inserting

‘‘AND CHILDREN’S HOSPITALS’’ after ‘‘CANCER HOSPITALS’’; and

(2) in paragraphs (7)(D)(ii) and (11), by striking ‘‘section

1886(d)(1)(B)(v)’’ and inserting ‘‘clause (iii) or (v) of section

1886(d)(1)(B)’’.

(b) EFFECTIVE DATE.—The amendments made by subsection

(a) shall apply as if included in the enactment of section 202

of BBRA (113 Stat. 1501A–342).

114 STAT. 2763A–508 PUBLIC LAW 106–554—APPENDIX F

SEC. 406. INCLUSION OF TEMPERATURE MONITORED CRYOABLATION

IN TRANSITIONAL PASS-THROUGH FOR CERTAIN MEDICAL DEVICES, DRUGS, AND BIOLOGICALS UNDER OPD

PPS.

(a) IN GENERAL.—Section 1833(t)(6)(A)(ii) (42 U.S.C.

1395l(t)(6)(A)(ii)) is amended by inserting ‘‘or temperature monitored cryoablation’’ after ‘‘device of brachytherapy’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to devices furnished on or after April 1, 2001.

Subtitle B—Provisions Relating to

Physicians’ Services

SEC. 411. GAO STUDIES RELATING TO PHYSICIANS’ SERVICES.

(a) STUDY OF SPECIALIST PHYSICIANS’ SERVICES FURNISHED IN

PHYSICIANS’ OFFICES AND HOSPITAL OUTPATIENT DEPARTMENT

SERVICES.—

(1) STUDY.—The Comptroller General of the United States

shall conduct a study to examine the appropriateness of furnishing in physicians’ offices specialist physicians’ services (such

as gastrointestinal endoscopic physicians’ services) which are

ordinarily furnished in hospital outpatient departments. In

conducting this study, the Comptroller General shall—

(A) review available scientific and clinical evidence

about the safety of performing procedures in physicians’

offices and hospital outpatient departments;

(B) assess whether resource-based practice expense relative values established by the Secretary of Health and

Human Services under the medicare physician fee schedule

under section 1848 of the Social Security Act (42 U.S.C.

1395w–4) for such specialist physicians’ services furnished

in physicians’ offices and hospital outpatient departments

create an incentive to furnish such services in physicians’

offices instead of hospital outpatient departments; and

(C) assess the implications for access to care for medicare beneficiaries if the medicare program were not to

cover such services in physicians’ offices.

(2) REPORT.—Not later than July 1, 2001, the Comptroller

General shall submit to Congress a report on such study and

include such recommendations as the Comptroller General

determines to be appropriate.

(b) STUDY OF THE RESOURCE-BASED PRACTICE EXPENSE SYSTEM.—

(1) STUDY.—The Comptroller General of the United States

shall conduct a study on the refinements to the practice expense

relative value units during the transition to a resource-based

practice expense system for physician payments under the

medicare program under title XVIII of the Social Security Act.

Such study shall examine how the Secretary of Health and

Human Services has accepted and used the practice expense

data submitted under section 212 of BBRA (113 Stat. 1501A–

350).

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–509

(2) REPORT.—Not later than July 1, 2001, the Comptroller

General shall submit to Congress a report on the study conducted under paragraph (1) together with recommendations

regarding—

(A) improvements in the process for acceptance and

use of practice expense data under section 212 of BBRA;

(B) any change or adjustment that is appropriate to

ensure full access to a spectrum of care for beneficiaries

under the medicare program; and

(C) the appropriateness of payments to physicians.

SEC. 412. PHYSICIAN GROUP PRACTICE DEMONSTRATION.

(a) IN GENERAL.—Title XVIII is amended by inserting after

section 1866 the following new sections:

‘‘DEMONSTRATION OF APPLICATION OF PHYSICIAN VOLUME INCREASES

TO GROUP PRACTICES

‘‘SEC. 1866A. (a) DEMONSTRATION PROGRAM AUTHORIZED.—

‘‘(1) IN GENERAL.—The Secretary shall conduct demonstration projects to test and, if proven effective, expand the use

of incentives to health care groups participating in the program

under this title that—

‘‘(A) encourage coordination of the care furnished to

individuals under the programs under parts A and B by

institutional and other providers, practitioners, and suppliers of health care items and services;

‘‘(B) encourage investment in administrative structures

and processes to ensure efficient service delivery; and

‘‘(C) reward physicians for improving health outcomes.

Such projects shall focus on the efficiencies of furnishing health

care in a group-practice setting as compared to the efficiencies

of furnishing health care in other health care delivery systems.

‘‘(2) ADMINISTRATION BY CONTRACT.—Except as otherwise

specifically provided, the Secretary may administer the program

under this section in accordance with section 1866B.

‘‘(3) DEFINITIONS.—For purposes of this section, terms have

the following meanings:

‘‘(A) PHYSICIAN.—Except as the Secretary may otherwise provide, the term ‘physician’ means any individual

who furnishes services which may be paid for as physicians’

services under this title.

‘‘(B) HEALTH CARE GROUP.—The term ‘health care

group’ means a group of physicians (as defined in subparagraph (A)) organized at least in part for the purpose of

providing physicians’ services under this title. As the Secretary finds appropriate, a health care group may include

a hospital and any other individual or entity furnishing

items or services for which payment may be made under

this title that is affiliated with the health care group under

an arrangement structured so that such individual or entity

participates in a demonstration under this section and

will share in any bonus earned under subsection (d).

‘‘(b) ELIGIBILITY CRITERIA.—

114 STAT. 2763A–510 PUBLIC LAW 106–554—APPENDIX F

‘‘(1) IN GENERAL.—The Secretary is authorized to establish

criteria for health care groups eligible to participate in a demonstration under this section, including criteria relating to numbers of health care professionals in, and of patients served

by, the group, scope of services provided, and quality of care.

‘‘(2) PAYMENT METHOD.—A health care group participating

in the demonstration under this section shall agree with respect

to services furnished to beneficiaries within the scope of the

demonstration (as determined under subsection (c))— ‘‘(A) to be paid on a fee-for-service basis; and

‘‘(B) that payment with respect to all such services

furnished by members of the health care group to such

beneficiaries shall (where determined appropriate by the

Secretary) be made to a single entity.

‘‘(3) DATA REPORTING.—A health care group participating

in a demonstration under this section shall report to the Secretary such data, at such times and in such format as the

Secretary requires, for purposes of monitoring and evaluation

of the demonstration under this section.

‘‘(c) PATIENTS WITHIN SCOPE OF DEMONSTRATION.—

‘‘(1) IN GENERAL.—The Secretary shall specify, in accordance with this subsection, the criteria for identifying those

patients of a health care group who shall be considered within

the scope of the demonstration under this section for purposes

of application of subsection (d) and for assessment of the

effectiveness of the group in achieving the objectives of this

section.

‘‘(2) OTHER CRITERIA.—The Secretary may establish additional criteria for inclusion of beneficiaries within a demonstration under this section, which may include frequency of contact

with physicians in the group or other factors or criteria that

the Secretary finds to be appropriate.

‘‘(3) NOTICE REQUIREMENTS.—In the case of each beneficiary

determined to be within the scope of a demonstration under

this section with respect to a specific health care group, the

Secretary shall ensure that such beneficiary is notified of the

incentives, and of any waivers of coverage or payment rules,

applicable to such group under such demonstration.

‘‘(d) INCENTIVES.—

‘‘(1) PERFORMANCE TARGET.—The Secretary shall establish

for each health care group participating in a demonstration

under this section—

‘‘(A) a base expenditure amount, equal to the average

total payments under parts A and B for patients served

by the health care group on a fee-for-service basis in a

base period determined by the Secretary; and

‘‘(B) an annual per capita expenditure target for

patients determined to be within the scope of the demonstration, reflecting the base expenditure amount adjusted

for risk and expected growth rates.

‘‘(2) INCENTIVE BONUS.—The Secretary shall pay to each

participating health care group (subject to paragraph (4)) a

bonus for each year under the demonstration equal to a portion

of the medicare savings realized for such year relative to the

performance target.

‘‘(3) ADDITIONAL BONUS FOR PROCESS AND OUTCOME

IMPROVEMENTS.—At such time as the Secretary has established

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–511

appropriate criteria based on evidence the Secretary determines

to be sufficient, the Secretary shall also pay to a participating

health care group (subject to paragraph (4)) an additional bonus

for a year, equal to such portion as the Secretary may designate

of the saving to the program under this title resulting from

process improvements made by and patient outcome improvements attributable to activities of the group. ‘‘(4) LIMITATION.—The Secretary shall limit bonus payments under this section as necessary to ensure that the aggregate expenditures under this title (inclusive of bonus payments)

with respect to patients within the scope of the demonstration

do not exceed the amount which the Secretary estimates would

be expended if the demonstration projects under this section

were not implemented.

‘‘PROVISIONS FOR ADMINISTRATION OF DEMONSTRATION PROGRAM

‘‘SEC. 1866B. (a) GENERAL ADMINISTRATIVE AUTHORITY.— ‘‘(1) BENEFICIARY ELIGIBILITY.—Except as otherwise provided by the Secretary, an individual shall only be eligible

to receive benefits under the program under section 1866A

(in this section referred to as the ‘demonstration program’)

if such individual— ‘‘(A) is enrolled under the program under part B and

entitled to benefits under part A; and ‘‘(B) is not enrolled in a Medicare+Choice plan under

part C, an eligible organization under a contract under

section 1876 (or a similar organization operating under

a demonstration project authority), an organization with

an agreement under section 1833(a)(1)(A), or a PACE program under section 1894.

‘‘(2) SECRETARY’S DISCRETION AS TO SCOPE OF PROGRAM.— The Secretary may limit the implementation of the demonstration program to— ‘‘(A) a geographic area (or areas) that the Secretary

designates for purposes of the program, based upon such

criteria as the Secretary finds appropriate; ‘‘(B) a subgroup (or subgroups) of beneficiaries or

individuals and entities furnishing items or services (otherwise eligible to participate in the program), selected on

the basis of the number of such participants that the Secretary finds consistent with the effective and efficient

implementation of the program; ‘‘(C) an element (or elements) of the program that

the Secretary determines to be suitable for implementation;

or ‘‘(D) any combination of any of the limits described

in subparagraphs (A) through (C).

‘‘(3) VOLUNTARY RECEIPT OF ITEMS AND SERVICES.—Items

and services shall be furnished to an individual under the

demonstration program only at the individual’s election. ‘‘(4) AGREEMENTS.—The Secretary is authorized to enter

into agreements with individuals and entities to furnish health

care items and services to beneficiaries under the demonstration program. ‘‘(5) PROGRAM STANDARDS AND CRITERIA.—The Secretary

shall establish performance standards for the demonstration

program including, as applicable, standards for quality of health

114 STAT. 2763A–512 PUBLIC LAW 106–554—APPENDIX F

care items and services, cost-effectiveness, beneficiary satisfaction, and such other factors as the Secretary finds appropriate.

The eligibility of individuals or entities for the initial award,

continuation, and renewal of agreements to provide health care

items and services under the program shall be conditioned,

at a minimum, on performance that meets or exceeds such

standards.

‘‘(6) ADMINISTRATIVE REVIEW OF DECISIONS AFFECTING

INDIVIDUALS AND ENTITIES FURNISHING SERVICES.—An individual or entity furnishing services under the demonstration program shall be entitled to a review by the program administrator

(or, if the Secretary has not contracted with a program administrator, by the Secretary) of a decision not to enter into, or

to terminate, or not to renew, an agreement with the entity

to provide health care items or services under the program. ‘‘(7) SECRETARY’S REVIEW OF MARKETING MATERIALS.—An

agreement with an individual or entity furnishing services

under the demonstration program shall require the individual

or entity to guarantee that it will not distribute materials

that market items or services under the program without the

Secretary’s prior review and approval. ‘‘(8) PAYMENT IN FULL.—

‘‘(A) IN GENERAL.—Except as provided in subparagraph

(B), an individual or entity receiving payment from the

Secretary under a contract or agreement under the demonstration program shall agree to accept such payment

as payment in full, and such payment shall be in lieu

of any payments to which the individual or entity would

otherwise be entitled under this title.

‘‘(B) COLLECTION OF DEDUCTIBLES AND COINSURANCE.—

Such individual or entity may collect any applicable deductible or coinsurance amount from a beneficiary.

‘‘(b) CONTRACTS FOR PROGRAM ADMINISTRATION.—

‘‘(1) IN GENERAL.—The Secretary may administer the demonstration program through a contract with a program administrator in accordance with the provisions of this subsection.

‘‘(2) SCOPE OF PROGRAM ADMINISTRATOR CONTRACTS.—The

Secretary may enter into such contracts for a limited geographic

area, or on a regional or national basis.

‘‘(3) ELIGIBLE CONTRACTORS.—The Secretary may contract

for the administration of the program with—

‘‘(A) an entity that, under a contract under section

1816 or 1842, determines the amount of and makes payments for health care items and services furnished under

this title; or

‘‘(B) any other entity with substantial experience in

managing the type of program concerned.

‘‘(4) CONTRACT AWARD, DURATION, AND RENEWAL.—

‘‘(A) IN GENERAL.—A contract under this subsection

shall be for an initial term of up to three years, renewable

for additional terms of up to three years. ‘‘(B) NONCOMPETITIVE AWARD AND RENEWAL FOR ENTITIES ADMINISTERING PART A OR PART B PAYMENTS.—The

Secretary may enter or renew a contract under this subsection with an entity described in paragraph (3)(A) without

regard to the requirements of section 5 of title 41, United

States Code.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–513

‘‘(5) APPLICABILITY OF FEDERAL ACQUISITION REGULATION.— The Federal Acquisition Regulation shall apply to program

administration contracts under this subsection. ‘‘(6) PERFORMANCE STANDARDS.—The Secretary shall establish performance standards for the program administrator

including, as applicable, standards for the quality and costeffectiveness of the program administered, and such other factors as the Secretary finds appropriate. The eligibility of entities

for the initial award, continuation, and renewal of program

administration contracts shall be conditioned, at a minimum,

on performance that meets or exceeds such standards. ‘‘(7) FUNCTIONS OF PROGRAM ADMINISTRATOR.—A program

administrator shall perform any or all of the following functions,

as specified by the Secretary: ‘‘(A) AGREEMENTS WITH ENTITIES FURNISHING HEALTH

CARE ITEMS AND SERVICES.—Determine the qualifications

of entities seeking to enter or renew agreements to provide

services under the demonstration program, and as appropriate enter or renew (or refuse to enter or renew) such

agreements on behalf of the Secretary. ‘‘(B) ESTABLISHMENT OF PAYMENT RATES.—Negotiate

or otherwise establish, subject to the Secretary’s approval,

payment rates for covered health care items and services.

‘‘(C) PAYMENT OF CLAIMS OR FEES.—Administer payments for health care items or services furnished under

the program.

‘‘(D) PAYMENT OF BONUSES.—Using such guidelines as

the Secretary shall establish, and subject to the approval

of the Secretary, make bonus payments as described in

subsection (c)(2)(A)(ii) to entities furnishing items or services for which payment may be made under the program.

‘‘(E) OVERSIGHT.—Monitor the compliance of individuals and entities with agreements under the program with

the conditions of participation.

‘‘(F) ADMINISTRATIVE REVIEW.—Conduct reviews of

adverse determinations specified in subsection (a)(6).

‘‘(G) REVIEW OF MARKETING MATERIALS.—Conduct a

review of marketing materials proposed by an entity furnishing services under the program.

‘‘(H) ADDITIONAL FUNCTIONS.—Perform such other

functions as the Secretary may specify.

‘‘(8) LIMITATION OF LIABILITY.—The provisions of section

1157(b) shall apply with respect to activities of contractors

and their officers, employees, and agents under a contract

under this subsection.

‘‘(9) INFORMATION SHARING.—Notwithstanding section 1106

and section 552a of title 5, United States Code, the Secretary

is authorized to disclose to an entity with a program administration contract under this subsection such information (including

medical information) on individuals receiving health care items

and services under the program as the entity may require

to carry out its responsibilities under the contract.

‘‘(c) RULES APPLICABLE TO BOTH PROGRAM AGREEMENTS AND

PROGRAM ADMINISTRATION CONTRACTS.—

‘‘(1) RECORDS, REPORTS, AND AUDITS.—The Secretary is

authorized to require entities with agreements to provide health

care items or services under the demonstration program, and

114 STAT. 2763A–514 PUBLIC LAW 106–554—APPENDIX F

entities with program administration contracts under subsection (b), to maintain adequate records, to afford the Secretary

access to such records (including for audit purposes), and to

furnish such reports and other materials (including audited

financial statements and performance data) as the Secretary

may require for purposes of implementation, oversight, and

evaluation of the program and of individuals’ and entities’

effectiveness in performance of such agreements or contracts.

‘‘(2) BONUSES.—Notwithstanding any other provision of

law, but subject to subparagraph (B)(ii), the Secretary may

make bonus payments under the demonstration program from

the Federal Health Insurance Trust Fund and the Federal

Supplementary Medical Insurance Trust Fund in amounts that

do not exceed the amounts authorized under the program in

accordance with the following:

‘‘(A) PAYMENTS TO PROGRAM ADMINISTRATORS.—The

Secretary may make bonus payments under the program

to program administrators.

‘‘(B) PAYMENTS TO ENTITIES FURNISHING SERVICES.—

‘‘(i) IN GENERAL.—Subject to clause (ii), the Secretary may make bonus payments to individuals or

entities furnishing items or services for which payment

may be made under the demonstration program, or

may authorize the program administrator to make such

bonus payments in accordance with such guidelines

as the Secretary shall establish and subject to the

Secretary’s approval.

‘‘(ii) LIMITATIONS.—The Secretary may condition

such payments on the achievement of such standards

related to efficiency, improvement in processes or outcomes of care, or such other factors as the Secretary

determines to be appropriate.

‘‘(3) ANTIDISCRIMINATION LIMITATION.—The Secretary shall

not enter into an agreement with an entity to provide health

care items or services under the demonstration program, or

with an entity to administer the program, unless such entity

guarantees that it will not deny, limit, or condition the coverage

or provision of benefits under the program, for individuals

eligible to be enrolled under such program, based on any health

status-related factor described in section 2702(a)(1) of the Public

Health Service Act.

‘‘(d) LIMITATIONS ON JUDICIAL REVIEW.—The following actions

and determinations with respect to the demonstration program

shall not be subject to review by a judicial or administrative tribunal:

‘‘(1) Limiting the implementation of the program under

subsection (a)(2).

‘‘(2) Establishment of program participation standards

under subsection (a)(5) or the denial or termination of, or

refusal to renew, an agreement with an entity to provide health

care items and services under the program.

‘‘(3) Establishment of program administration contract

performance standards under subsection (b)(6), the refusal to

renew a program administration contract, or the noncompetitive

award or renewal of a program administration contract under

subsection (b)(4)(B).

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–515

‘‘(4) Establishment of payment rates, through negotiation

or otherwise, under a program agreement or a program

administration contract.

‘‘(5) A determination with respect to the program (where

specifically authorized by the program authority or by subsection (c)(2))—

‘‘(A) as to whether cost savings have been achieved,

and the amount of savings; or

‘‘(B) as to whether, to whom, and in what amounts

bonuses will be paid.

‘‘(e) APPLICATION LIMITED TO PARTS A AND B.—None of the

provisions of this section or of the demonstration program shall

apply to the programs under part C.

‘‘(f ) REPORTS TO CONGRESS.—Not later than two years after

the date of the enactment of this section, and biennially thereafter

for six years, the Secretary shall report to Congress on the use

of authorities under the demonstration program. Each report shall

address the impact of the use of those authorities on expenditures,

access, and quality under the programs under this title.’’.

(b) GAO REPORT.—Not later than 2 years after the date on

which the demonstration project under section 1866A of the Social

Security Act, as added by subsection (a), is implemented, the

Comptroller General of the United States shall submit to Congress

a report on such demonstration project. The report shall include

such recommendations with respect to changes to the demonstration

project that the Comptroller General determines appropriate.

SEC. 413. STUDY ON ENROLLMENT PROCEDURES FOR GROUPS THAT

RETAIN INDEPENDENT CONTRACTOR PHYSICIANS.

(a) IN GENERAL.—The Comptroller General of the United States

shall conduct a study of the current medicare enrollment process

for groups that retain independent contractor physicians with

particular emphasis on hospital-based physicians, such as emergency department staffing groups. In conducting the evaluation,

the Comptroller General shall consult with groups that retain

independent contractor physicians and shall—

(1) review the issuance of individual medicare provider

numbers and the possible medicare program integrity

vulnerabilities of the current process;

(2) review direct and indirect costs associated with the

current process incurred by the medicare program and groups

that retain independent contractor physicians;

(3) assess the effect on program integrity by the enrollment

of groups that retain independent contractor hospital-based

physicians; and

(4) develop suggested procedures for the enrollment of these

groups.

(b) REPORT.—Not later than 1 year after the date of the enactment of this Act, the Comptroller General shall submit to Congress

a report on the study conducted under subsection (a).

114 STAT. 2763A–516 PUBLIC LAW 106–554—APPENDIX F

Subtitle C—Other Services

SEC. 421. ONE-YEAR EXTENSION OF MORATORIUM ON THERAPY CAPS;

REPORT ON STANDARDS FOR SUPERVISION OF PHYSICAL

THERAPY ASSISTANTS.

(a) IN GENERAL.—Section 1833(g)(4) (42 U.S.C. 1395l(g)(4)) is

amended by striking ‘‘2000 and 2001.’’ and inserting ‘‘2000, 2001,

and 2002.’’. (b) CONFORMING AMENDMENT TO CONTINUE FOCUSED MEDICAL

REVIEWS OF CLAIMS DURING MORATORIUM PERIOD.—Section

221(a)(2) of BBRA (113 Stat. 1501A–351) is amended by striking ‘‘(under the amendment made by paragraph (1)(B))’’. (c) STUDY ON STANDARDS FOR SUPERVISION OF PHYSICAL THERA- PIST ASSISTANTS.— (1) STUDY.—The Secretary of Health and Human Services

shall conduct a study of the implications— (A) of eliminating the ‘‘in the room’’ supervision

requirement for medicare payment for services of physical

therapy assistants who are supervised by physical therapists; and

(B) of such requirement on the cap imposed under

section 1833(g) of the Social Security Act (42 U.S.C.

1395l(g)) on physical therapy services.

(2) REPORT.—Not later than 18 months after the date of

the enactment of this Act, the Secretary shall submit to Congress a report on the study conducted under paragraph (1).

SEC. 422. UPDATE IN RENAL DIALYSIS COMPOSITE RATE.

(a) UPDATE.—

(1) IN GENERAL.—The last sentence of section 1881(b)(7)

(42 U.S.C. 1395rr(b)(7)) is amended by striking ‘‘for such services furnished on or after January 1, 2001, by 1.2 percent’’

and inserting ‘‘for such services furnished on or after January

1, 2001, by 2.4 percent’’. (2) PROHIBITION ON EXCEPTIONS.—

(A) IN GENERAL.—Subject to subparagraphs (B) and

(C), the Secretary of Health and Human Services may

not provide for an exception under section 1881(b)(7) of

the Social Security Act (42 U.S.C. 1395rr(b)(7)) on or after

December 31, 2000.

(B) DEADLINE FOR NEW APPLICATIONS.—In the case

of a facility that during 2000 did not file for an exception

rate under such section, the facility may submit an application for an exception rate by not later than July 1, 2001.

(C) PROTECTION OF APPROVED EXCEPTION RATES.—Any

exception rate under such section in effect on December

31, 2000 (or, in the case of an application under subparagraph (B), as approved under such application) shall continue in effect so long as such rate is greater than the

composite rate as updated by the amendment made by

paragraph (1).

(b) DEVELOPMENT OF ESRD MARKET BASKET.—

(1) DEVELOPMENT.—The Secretary of Health and Human

Services shall collect data and develop an ESRD market basket

whereby the Secretary can estimate, before the beginning of

a year, the percentage by which the costs for the year of

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–517

the mix of labor and nonlabor goods and services included

in the ESRD composite rate under section 1881(b)(7) of the

Social Security Act (42 U.S.C. 1395rr(b)(7)) will exceed the

costs of such mix of goods and services for the preceding year.

In developing such index, the Secretary may take into account

measures of changes in—

(A) technology used in furnishing dialysis services;

(B) the manner or method of furnishing dialysis services; and

(C) the amounts by which the payments under such

section for all services billed by a facility for a year exceed

the aggregate allowable audited costs of such services for

such facility for such year.

(2) REPORT.—The Secretary of Health and Human Services

shall submit to Congress a report on the index developed under

paragraph (1) no later than July 1, 2002, and shall include

in the report recommendations on the appropriateness of an

annual or periodic update mechanism for renal dialysis services

under the medicare program under title XVIII of the Social

Security Act based on such index.

(c) INCLUSION OF ADDITIONAL SERVICES IN COMPOSITE RATE.—

(1) DEVELOPMENT.—The Secretary of Health and Human

Services shall develop a system which includes, to the maximum

extent feasible, in the composite rate used for payment under

section 1881(b)(7) of the Social Security Act (42 U.S.C.

1395rr(b)(7)), payment for clinical diagnostic laboratory tests

and drugs (including drugs paid under section 1881(b)(11)(B)

of such Act (42 U.S.C. 1395rr(b)(11)(B)) that are routinely used

in furnishing dialysis services to medicare beneficiaries but

which are currently separately billable by renal dialysis facilities.

(2) REPORT.—The Secretary shall include, as part of the

report submitted under subsection (b)(2), a report on the system

developed under paragraph (1) and recommendations on the

appropriateness of incorporating the system into medicare payment for renal dialysis services.

(d) GAO STUDY ON ACCESS TO SERVICES.—

(1) STUDY.—The Comptroller General of the United States

shall study access of medicare beneficiaries to renal dialysis

services. Such study shall include whether there is a sufficient

supply of facilities to furnish needed renal dialysis services,

whether medicare payment levels are appropriate, taking into

account audited costs of facilities for all services furnished,

to ensure continued access to such services, and improvements

in access (and quality of care) that may result in the increased

use of long nightly and short daily hemodialysis modalities.

(2) REPORT.—Not later than January 1, 2003, the Comptroller General shall submit to Congress a report on the study

conducted under paragraph (1).

(e) SPECIAL RULE FOR PAYMENT FOR 2001.—Notwithstanding

the amendment made by subsection (a)(1), for purposes of making

payments under section 1881(b) of the Social Security Act (42

U.S.C. 1395rr(b)) for dialysis services furnished during 2001, the

composite rate payment under paragraph (7) of such section—

(1) for services furnished on or after January 1, 2001,

and before April 1, 2001, shall be the composite rate payment

114 STAT. 2763A–518 PUBLIC LAW 106–554—APPENDIX F

determined under the provisions of law in effect on the day

before the date of the enactment of this Act; and

(2) for services furnished on or after April 1, 2001, and

before January 1, 2002, shall be the composite rate payment

(as determined taking into account the amendment made by

subsection (a)(1)) increased by a transitional percentage allowance equal to 0.39 percent (to account for the timing of

implementation of the CPI update).

SEC. 423. PAYMENT FOR AMBULANCE SERVICES.

(a) RESTORATION OF FULL CPI INCREASE FOR 2001.— (1) IN GENERAL.—Section 1834(l)(3) (42 U.S.C. 1395m(l)(3))

is amended by striking ‘‘reduced in the case of 2001 and 2002’’ each place it appears and inserting ‘‘reduced in the case of

2002’’.

(2) SPECIAL RULE FOR PAYMENT FOR 2001.—Notwithstanding

the amendment made by paragraph (1), for purposes of making

payments for ambulance services under part B of title XVIII

of the Social Security Act, for services furnished during 2001,

the ‘‘percentage increase in the consumer price index’’ specified

in section 1834(l)(3)(B) of such Act (42 U.S.C. 1395m(l)(3)(B))— (A) for services furnished on or after January 1, 2001,

and before July 1, 2001, shall be the percentage increase

for 2001 as determined under the provisions of law in

effect on the day before the date of the enactment of this

Act; and

(B) for services furnished on or after July 1, 2001,

and before January 1, 2002, shall be equal to 4.7 percent.

(b) MILEAGE PAYMENTS.— (1) IN GENERAL.—Section 1834(l)(2)(E) (42 U.S.C.

1395m(l)(2)(E)) is amended by inserting before the period at

the end the following: ‘‘, except that such phase-in shall provide

for full payment of any national mileage rate for ambulance

services provided by suppliers that are paid by carriers in

any of the 50 States where payment by a carrier for such

services for all such suppliers in such State did not, prior

to the implementation of the fee schedule, include a separate

amount for all mileage within the county from which the beneficiary is transported’’. (2) EFFECTIVE DATE.—The amendment made by paragraph

(1) shall apply to services furnished on or after July 1, 2001.

SEC. 424. AMBULATORY SURGICAL CENTERS.

(a) DELAY IN IMPLEMENTATION OF PROSPECTIVE PAYMENT SYS- TEM.—The Secretary of Health and Human Services may not implement a revised prospective payment system for services of ambulatory surgical facilities under section 1833(i) of the Social Security

Act (42 U.S.C. 1395l(i)) before January 1, 2002.

(b) EXTENDING PHASE-IN TO 4 YEARS.—Section 226 of the BBRA

(113 Stat. 1501A–354) is amended by striking paragraphs (1) and

(2) and inserting the following:

‘‘(1) in the first year of its implementation, only a proportion

(specified by the Secretary and not to exceed one-fourth) of

the payment for such services shall be made in accordance

with such system and the remainder shall be made in accordance with current regulations; and

‘‘(2) in each of the following 2 years a proportion (specified

by the Secretary and not to exceed one-half and three-fourths,

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–519

respectively) of the payment for such services shall be made

under such system and the remainder shall be made in accordance with current regulations.’’. (c) DEADLINE FOR USE OF 1999 OR LATER COST SURVEYS.— Section 226 of BBRA (113 Stat. 1501A–354) is amended by adding

at the end the following:

‘‘By not later than January 1, 2003, the Secretary shall incorporate

data from a 1999 medicare cost survey or a subsequent cost survey

for purposes of implementing or revising such system.’’.

SEC. 425. FULL UPDATE FOR DURABLE MEDICAL EQUIPMENT.

(a) IN GENERAL.—Section 1834(a)(14) (42 U.S.C. 1395m(a)(14))

is amended— (1) by redesignating subparagraph (D) as subparagraph

(F);

(2) in subparagraph (C)— (A) by striking ‘‘through 2002’’ and inserting ‘‘through

2000’’; and

(B) by striking ‘‘and’’ at the end; and

(3) by inserting after subparagraph (C) the following new

subparagraphs: ‘‘(D) for 2001, the percentage increase in the consumer

price index for all urban consumers (U.S. city average)

for the 12-month period ending with June 2000; ‘‘(E) for 2002, 0 percentage points; and’’. (b) SPECIAL RULE FOR PAYMENT FOR 2001.—Notwithstanding

the amendments made by subsection (a), for purposes of making

payments for durable medical equipment under section 1834(a)

of the Social Security Act (42 U.S.C. 1395m(a)), other than for

oxygen and oxygen equipment specified in paragraph (9) of such

section, the payment basis recognized for 2001 under such section— (1) for items furnished on or after January 1, 2001, and

before July 1, 2001, shall be the payment basis for 2001 as

determined under the provisions of law in effect on the day

before the date of the enactment of this Act (including the

application of section 228(a)(1) of BBRA); and

(2) for items furnished on or after July 1, 2001, and before

January 1, 2002, shall be the payment basis that is determined

under such section 1834(a) if such section 228(a)(1) did not

apply and taking into account the amendment made by subsection (a), increased by a transitional percentage allowance

equal to 3.28 percent (to account for the timing of implementation of the CPI update).

SEC. 426. FULL UPDATE FOR ORTHOTICS AND PROSTHETICS.

(a) IN GENERAL.—Section 1834(h)(4)(A) (42 U.S.C.

1395m(h)(4)(A)) is amended— (1) by redesignating clause (vi) as clause (viii);

(2) in clause (v)—

(A) by striking ‘‘through 2002’’ and inserting ‘‘through

2000’’; and

(B) by striking ‘‘and’’ at the end; and

(3) by inserting after clause (v) the following new clause:

‘‘(vi) for 2001, the percentage increase in the consumer price index for all urban consumers (U.S. city

average) for the 12-month period ending with June

2000;‘‘(vii) for 2002, 1 percent; and’’.

114 STAT. 2763A–520 PUBLIC LAW 106–554—APPENDIX F

(b) SPECIAL RULE FOR PAYMENT FOR 2001.—Notwithstanding

the amendments made by subsection (a), for purposes of making

payments for prosthetic devices and orthotics and prosthetics (as

defined in subparagraphs (B) and (C) of paragraph (4) of section

1834(h) of the Social Security Act (42 U.S.C. 1395m(h)) under

such section, the payment basis recognized for 2001 under paragraph (2) of such section—

(1) for items furnished on or after January 1, 2001, and

before July 1, 2001, shall be the payment basis for 2001 as

determined under the provisions of law in effect on the day

before the date of the enactment of this Act; and

(2) for items furnished on or after July 1, 2001, and before

January 1, 2002, shall be the payment basis that is determined

under such section taking into account the amendments made

by subsection (a), increased by a transitional percentage allowance equal to 2.6 percent (to account for the timing of

implementation of the CPI update).

SEC. 427. ESTABLISHMENT OF SPECIAL PAYMENT PROVISIONS AND

REQUIREMENTS FOR PROSTHETICS AND CERTAIN CUSTOM-FABRICATED ORTHOTIC ITEMS.

(a) IN GENERAL.—Section 1834(h)(1) (42 U.S.C. 1395m(h)(1))

is amended by adding at the end the following:

‘‘(F) SPECIAL PAYMENT RULES FOR CERTAIN PROSTHETICS

AND CUSTOM-FABRICATED ORTHOTICS.—

‘‘(i) IN GENERAL.—No payment shall be made under

this subsection for an item of custom-fabricated

orthotics described in clause (ii) or for an item of

prosthetics unless such item is—

‘‘(I) furnished by a qualified practitioner; and

‘‘(II) fabricated by a qualified practitioner or

a qualified supplier at a facility that meets such

criteria as the Secretary determines appropriate.

‘‘(ii) DESCRIPTION OF CUSTOM-FABRICATED ITEM.—

‘‘(I) IN GENERAL.—An item described in this

clause is an item of custom-fabricated orthotics

that requires education, training, and experience

to custom-fabricate and that is included in a list

established by the Secretary in subclause (II). Such

an item does not include shoes and shoe inserts.

‘‘(II) LIST OF ITEMS.—The Secretary, in consultation with appropriate experts in orthotics

(including national organizations representing

manufacturers of orthotics), shall establish and

update as appropriate a list of items to which

this subparagraph applies. No item may be

included in such list unless the item is individually

fabricated for the patient over a positive model

of the patient.

‘‘(iii) QUALIFIED PRACTITIONER DEFINED.—In this

subparagraph, the term ‘qualified practitioner’ means

a physician or other individual who—

‘‘(I) is a qualified physical therapist or a qualified occupational therapist;

‘‘(II) in the case of a State that provides for

the licensing of orthotics and prosthetics, is

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–521

licensed in orthotics or prosthetics by the State

in which the item is supplied; or

‘‘(III) in the case of a State that does not

provide for the licensing of orthotics and prosthetics, is specifically trained and educated to provide

or manage the provision of prosthetics and customdesigned or -fabricated orthotics, and is certified

by the American Board for Certification in

Orthotics and Prosthetics, Inc. or by the Board

for Orthotist/Prosthetist Certification, or is

credentialed and approved by a program that the

Secretary determines, in consultation with appropriate experts in orthotics and prosthetics, has

training and education standards that are necessary to provide such prosthetics and orthotics.

‘‘(iv) QUALIFIED SUPPLIER DEFINED.—In this

subparagraph, the term ‘qualified supplier’ means any

entity that is accredited by the American Board for

Certification in Orthotics and Prosthetics, Inc. or by

the Board for Orthotist/Prosthetist Certification, or

accredited and approved by a program that the Secretary determines has accreditation and approval

standards that are essentially equivalent to those of

such Board.’’.

(b) EFFECTIVE DATE.—Not later than 1 year after the date

of the enactment of this Act, the Secretary of Health and Human

Services shall promulgate revised regulations to carry out the

amendment made by subsection (a) using a negotiated rulemaking

process under subchapter III of chapter 5 of title 5, United States

Code.

(c) GAO STUDY AND REPORT.—

(1) STUDY.—The Comptroller General of the United States

shall conduct a study on HCFA Ruling 96–1, issued on September 1, 1996, with respect to distinguishing orthotics from durable medical equipment under the medicare program under title

XVIII of the Social Security Act. The study shall assess the

following matters:

(A) The compliance of the Secretary of Health and

Human Services with the Administrative Procedures Act

(under chapter 5 of title 5, United States Code) in making

such ruling.

(B) The potential impact of such ruling on the health

care furnished to medicare beneficiaries under the medicare

program, especially those beneficiaries with degenerative

musculoskeletal conditions.

(C) The potential for fraud and abuse under the medicare program if payment were provided for orthotics used

as a component of durable medical equipment only when

made under the special payment provision for certain

prosthetics and custom-fabricated orthotics under section

1834(h)(1)(F) of the Social Security Act, as added by subsection (a) and furnished by qualified practitioners under

that section.

(D) The impact on payments under titles XVIII and

XIX of the Social Security Act if such ruling were overturned.

114 STAT. 2763A–522 PUBLIC LAW 106–554—APPENDIX F

(2) REPORT.—Not later than 6 months after the date of

the enactment of this Act, the Comptroller General shall submit

to Congress a report on the study conducted under paragraph

(1).

SEC. 428. REPLACEMENT OF PROSTHETIC DEVICES AND PARTS.

(a) IN GENERAL.—Section 1834(h)(1) (42 U.S.C. 1395m(h)(1)),

as amended by section 427(a), is further amended by adding at

the end the following new subparagraph: ‘‘(G) REPLACEMENT OF PROSTHETIC DEVICES AND

PARTS.—‘‘(i) IN GENERAL.—Payment shall be made for the

replacement of prosthetic devices which are artificial

limbs, or for the replacement of any part of such

devices, without regard to continuous use or useful

lifetime restrictions if an ordering physician determines that the provision of a replacement device, or

a replacement part of such a device, is necessary

because of any of the following: ‘‘(I) A change in the physiological condition

of the patient. ‘‘(II) An irreparable change in the condition

of the device, or in a part of the device. ‘‘(III) The condition of the device, or the part

of the device, requires repairs and the cost of such

repairs would be more than 60 percent of the

cost of a replacement device, or, as the case may

be, of the part being replaced.

‘‘(ii) CONFIRMATION MAY BE REQUIRED IF DEVICE

OR PART BEING REPLACED IS LESS THAN 3 YEARS OLD.— If a physician determines that a replacement device,

or a replacement part, is necessary pursuant to clause

(i)— ‘‘(I) such determination shall be controlling;

and ‘‘(II) such replacement device or part shall be

deemed to be reasonable and necessary for purposes of section 1862(a)(1)(A);

except that if the device, or part, being replaced is

less than 3 years old (calculated from the date on

which the beneficiary began to use the device or part),

the Secretary may also require confirmation of necessity of the replacement device or replacement part,

as the case may be.’’. (b) PREEMPTION OF RULE.—The provisions of section

1834(h)(1)(G) as added by subsection (a) shall supersede any rule

that as of the date of the enactment of this Act may have applied

a 5-year replacement rule with regard to prosthetic devices.

(c) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to items replaced on or after April 1, 2001.

SEC. 429. REVISED PART B PAYMENT FOR DRUGS AND BIOLOGICALS

AND RELATED SERVICES.

(a) RECOMMENDATIONS FOR REVISED PAYMENT METHODOLOGY

FOR DRUGS AND BIOLOGICALS.—

(1) STUDY.—

(A) IN GENERAL.—The Comptroller General of the

United States shall conduct a study on the reimbursement

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–523

for drugs and biologicals under the current medicare payment methodology (provided under section 1842(o) of the

Social Security Act (42 U.S.C. 1395u(o))) and for related

services under part B of title XVIII of such Act. In the

study, the Comptroller General shall—

(i) identify the average prices at which such drugs

and biologicals are acquired by physicians and other

suppliers;

(ii) quantify the difference between such average

prices and the reimbursement amount under such section; and

(iii) determine the extent to which (if any) payment

under such part is adequate to compensate physicians,

providers of services, or other suppliers of such drugs

and biologicals for costs incurred in the administration,

handling, or storage of such drugs or biologicals.

(B) CONSULTATION.—In conducting the study under

subparagraph (A), the Comptroller General shall consult

with physicians, providers of services, and suppliers of

drugs and biologicals under the medicare program under

title XVIII of such Act, as well as other organizations

involved in the distribution of such drugs and biologicals

to such physicians, providers of services, and suppliers.

(2) REPORT.—Not later than 9 months after the date of

the enactment of this Act, the Comptroller General shall submit

to Congress and to the Secretary of Health and Human Services

a report on the study conducted under this subsection, and

shall include in such report recommendations for revised payment methodologies described in paragraph (3).

(3) RECOMMENDATIONS FOR REVISED PAYMENT METHODOLOGIES.—

(A) IN GENERAL.—The Comptroller General shall provide specific recommendations for revised payment methodologies for reimbursement for drugs and biologicals and

for related services under the medicare program. The

Comptroller General may include in the

recommendations—

(i) proposals to make adjustments under subsection

(c) of section 1848 of the Social Security Act (42 U.S.C.

1395w–4) for the practice expense component of the

physician fee schedule under such section for the costs

incurred in the administration, handling, or storage

of certain categories of such drugs and biologicals, if

appropriate; and

(ii) proposals for new payments to providers of

services or suppliers for such costs, if appropriate.

(B) ENSURING PATIENT ACCESS TO CARE.—In making

recommendations under this paragraph, the Comptroller

General shall ensure that any proposed revised payment

methodology is designed to ensure that medicare beneficiaries continue to have appropriate access to health care

services under the medicare program.

(C) MATTERS CONSIDERED.—In making recommendations under this paragraph, the Comptroller General shall

consider—

114 STAT. 2763A–524 PUBLIC LAW 106–554—APPENDIX F

(i) the method and amount of reimbursement for

similar drugs and biologicals made by large group

health plans;

(ii) as a result of any revised payment methodology, the potential for patients to receive inpatient or

outpatient hospital services in lieu of services in a

physician’s office; and

(iii) the effect of any revised payment methodology

on the delivery of drug therapies by hospital outpatient

departments.

(D) COORDINATION WITH BBRA STUDY.—In making recommendations under this paragraph, the Comptroller General shall conclude and take into account the results of

the study provided for under section 213(a) of BBRA (113

Stat. 1501A–350).

(b) IMPLEMENTATION OF NEW PAYMENT METHODOLOGY.—

(1) IN GENERAL.—Notwithstanding any other provision of

law, based on the recommendations contained in the report

under subsection (a), the Secretary of Health and Human Services, subject to paragraph (2), shall revise the payment methodology under section 1842(o) of the Social Security Act (42

U.S.C. 1395u(o)) for drugs and biologicals furnished under part

B of the medicare program. To the extent the Secretary determines appropriate, the Secretary may provide for the adjustments to payments amounts referred to in subsection (a)(3)(A)(i)

or additional payments referred to in subsection (a)(2)(A)(ii).

(2) LIMITATION.—In revising the payment methodology

under paragraph (1), in no case may the estimated aggregate

payments for drugs and biologicals under the revised system

(including additional payments referred to in subsection

(a)(3)(A)(ii)) exceed the aggregate amount of payment for such

drugs and biologicals, as projected by the Secretary, that would

have been made under the payment methodology in effect under

such section 1842(o).

(c) MORATORIUM ON DECREASES IN PAYMENT RATES.—Notwithstanding any other provision of law, effective for drugs and

biologicals furnished on or after January 1, 2001, the Secretary

may not directly or indirectly decrease the rates of reimbursement

(in effect as of such date) for drugs and biologicals under the

current medicare payment methodology (provided under section

1842(o) of the Social Security Act (42 U.S.C. 1395u(o))) until such

time as the Secretary has reviewed the report submitted under

subsection (a)(2).

SEC. 430. CONTRAST ENHANCED DIAGNOSTIC PROCEDURES UNDER

HOSPITAL PROSPECTIVE PAYMENT SYSTEM.

(a) SEPARATE CLASSIFICATION.—Section 1833(t)(2) (42 U.S.C.

1395l(t)(2)) is amended—

(1) by striking ‘‘and’’ at the end of subparagraph (E);

(2) by striking the period at the end of subparagraph (F)

and inserting ‘‘; and’’; and

(3) by inserting after subparagraph (F) the following new

subparagraph:

‘‘(G) the Secretary shall create additional groups of

covered OPD services that classify separately those procedures that utilize contrast agents from those that do not.’’.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–525

(b) CONFORMING AMENDMENT.—Section 1861(t)(1) (42 U.S.C.

1395x(t)(1)) is amended by inserting ‘‘(including contrast agents)’’ after ‘‘only such drugs’’. (c) EFFECTIVE DATE.—The amendments made by this section

apply to items and services furnished on or after July 1, 2001.

SEC. 431. QUALIFICATIONS FOR COMMUNITY MENTAL HEALTH CENTERS.

(a) MEDICARE PROGRAM.—Section 1861(ff )(3)(B) (42 U.S.C.

1395x(ff )(3)(B)) is amended by striking ‘‘entity’’ and all that follows

and inserting the following: ‘‘entity that— ‘‘(i)(I) provides the mental health services described in section 1913(c)(1) of the Public Health Service Act; or ‘‘(II) in the case of an entity operating in a State that

by law precludes the entity from providing itself the service

described in subparagraph (E) of such section, provides for

such service by contract with an approved organization or entity

(as determined by the Secretary); ‘‘(ii) meets applicable licensing or certification requirements

for community mental health centers in the State in which

it is located; and ‘‘(iii) meets such additional conditions as the Secretary

shall specify to ensure (I) the health and safety of individuals

being furnished such services, (II) the effective and efficient

furnishing of such services, and (III) the compliance of such

entity with the criteria described in section 1931(c)(1) of the

Public Health Service Act.’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply with respect to community mental health centers with

respect to services furnished on or after the first day of the third

month beginning after the date of the enactment of this Act.

SEC. 432. PAYMENT OF PHYSICIAN AND NONPHYSICIAN SERVICES IN

CERTAIN INDIAN PROVIDERS.

(a) IN GENERAL.—Section 1880 (42 U.S.C. 1395qq) is amended—

(1) by redesignating subsection (e), as added by section

3(b)(1) of the Alaska Native and American Indian Direct

Reimbursement Act of 2000 (Public Law 106–417), as subsection (f ); and

(2) by inserting after subsection (d) the following new subsection:

‘‘(e)(1)(A) Notwithstanding section 1835(d), subject to subparagraph (B), the Secretary shall make payment under part B to

a hospital or an ambulatory care clinic (whether provider-based

or freestanding) that is operated by the Indian Health Service

or by an Indian tribe or tribal organization (as defined for purposes

of subsection (a)) for services described in paragraph (2) furnished

in or at the direction of the hospital or clinic under the same

situations, terms, and conditions as would apply if the services

were furnished in or at the direction of such a hospital or clinic

that was not operated by such Service, tribe, or organization.

‘‘(B) Payment shall not be made for services under subparagraph (A) to the extent that payment is otherwise made for such

services under this title.

‘‘(2) The services described in this paragraph are the following:

‘‘(A) Services for which payment is made under section

1848.

114 STAT. 2763A–526 PUBLIC LAW 106–554—APPENDIX F

‘‘(B) Services furnished by a practitioner described in section 1842(b)(18)(C) for which payment under part B is made

under a fee schedule. ‘‘(C) Services furnished by a physical therapist or occupational therapist as described in section 1861(p) for which payment under part B is made under a fee schedule.

‘‘(3) Subsection (c) shall not apply to payments made under

this subsection.’’. (b) CONFORMING AMENDMENTS.— (1) COVERAGE AMENDMENT.—Section 1862(a)(3) (42 U.S.C.

1395y(a)(3)) is amended— (A) by striking the second comma after ‘‘1861(aa)(1)’’;

and

(B) by inserting ‘‘in the case of services for which

payment may be made under section 1880(e),’’ after ‘‘as

defined in section 1861(aa)(3),’’. (2) DIRECT PAYMENT AMENDMENT.—The first sentence of

section 1842(b)(6) (42 U.S.C. 1395u(b)(6)) is amended— (A) by striking ‘‘and (F)’’ and inserting ‘‘(F)’’; and

(B) by inserting before the period the following: ‘‘, and (G) in the case of services in a hospital or clinic

to which section 1880(e) applies, payment shall be made

to such hospital or clinic’’. (c) EFFECTIVE DATE.—The amendments made by this section

shall apply to services furnished on or after July 1, 2001.

SEC. 433. GAO STUDY ON COVERAGE OF SURGICAL FIRST ASSISTING

SERVICES OF CERTIFIED REGISTERED NURSE FIRST

ASSISTANTS.

(a) STUDY.—The Comptroller General of the United States shall

conduct a study on the effect on the medicare program under

title XVIII of the Social Security Act and on medicare beneficiaries

of coverage under the program of surgical first assisting services

of certified registered nurse first assistants. The Comptroller General shall consider the following when conducting the study:

(1) Any impact on the quality of care furnished to medicare

beneficiaries by reason of such coverage.

(2) Appropriate education and training requirements for

certified registered nurse first assistants who furnish such first

assisting services.

(3) Appropriate rates of payment under the program to

such certified registered nurse first assistants for furnishing

such services, taking into account the costs of compensation,

overhead, and supervision attributable to certified registered

nurse first assistants.

(b) REPORT.—Not later than 1 year after the date of the enactment of this Act, the Comptroller General shall submit to Congress

a report on the study conducted under subsection (a).

SEC. 434. MEDPAC STUDY AND REPORT ON MEDICARE REIMBURSEMENT FOR SERVICES PROVIDED BY CERTAIN PROVIDERS.

(a) STUDY.—The Medicare Payment Advisory Commission shall

conduct a study on the appropriateness of the current payment

rates under the medicare program under title XVIII of the Social

Security Act for services provided by a—

(1) certified nurse-midwife (as defined in subsection (gg)(2)

of section 1861 of such Act (42 U.S.C. 1395x));

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–527

(2) physician assistant (as defined in subsection (aa)(5)(A)

of such section);

(3) nurse practitioner (as defined in such subsection); and

(4) clinical nurse specialist (as defined in subsection

(aa)(5)(B) of such section).

The study shall separately examine the appropriateness of such

payment rates for orthopedic physician assistants, taking into

consideration the requirements for accreditation, training, and education.

(b) REPORT.—Not later than 18 months after the date of the

enactment of this Act, the Commission shall submit to Congress

a report on the study conducted under subsection (a), together

with any recommendations for legislation that the Commission

determines to be appropriate as a result of such study.

SEC. 435. MEDPAC STUDY AND REPORT ON MEDICARE COVERAGE OF

SERVICES PROVIDED BY CERTAIN NONPHYSICIAN

PROVIDERS.

(a) STUDY.—

(1) IN GENERAL.—The Medicare Payment Advisory Commission shall conduct a study to determine the appropriateness

of providing coverage under the medicare program under title

XVIII of the Social Security Act for services provided by a—

(A) surgical technologist;

(B) marriage counselor;

(C) marriage and family therapist;

(D) pastoral care counselor; and

(E) licensed professional counselor of mental health.

(2) COSTS TO PROGRAM.—The study shall consider the shortterm and long-term benefits, and costs to the medicare program,

of providing the coverage described in paragraph (1).

(b) REPORT.—Not later than 18 months after the date of the

enactment of this Act, the Commission shall submit to Congress

a report on the study conducted under subsection (a), together

with any recommendations for legislation that the Commission

determines to be appropriate as a result of such study.

SEC. 436. GAO STUDY AND REPORT ON THE COSTS OF EMERGENCY

AND MEDICAL TRANSPORTATION SERVICES.

(a) STUDY.—The Comptroller General of the United States shall

conduct a study on the costs of providing emergency and medical

transportation services across the range of acuity levels of conditions

for which such transportation services are provided.

(b) REPORT.—Not later than 18 months after the date of the

enactment of this Act, the Comptroller General shall submit to

Congress a report on the study conducted under subsection (a),

together with recommendations for any changes in methodology

or payment level necessary to fairly compensate suppliers of emergency and medical transportation services and to ensure the access

of beneficiaries under the medicare program under title XVIII of

the Social Security Act.

SEC. 437. GAO STUDIES AND REPORTS ON MEDICARE PAYMENTS.

(a) GAO STUDY ON HCFA POST-PAYMENT AUDIT PROCESS.—

(1) STUDY.—The Comptroller General of the United States

shall conduct a study on the post-payment audit process under

the medicare program under title XVIII of the Social Security

Act as such process applies to physicians, including the proper

114 STAT. 2763A–528 PUBLIC LAW 106–554—APPENDIX F

level of resources that the Health Care Financing Administration should devote to educating physicians regarding—

(A) coding and billing;

(B) documentation requirements; and

(C) the calculation of overpayments.

(2) REPORT.—Not later than 18 months after the date of

the enactment of this Act, the Comptroller General shall submit

to Congress a report on the study conducted under paragraph

(1) together with specific recommendations for changes or

improvements in the post-payment audit process described in

such paragraph.

(b) GAO STUDY ON ADMINISTRATION AND OVERSIGHT.—

(1) STUDY.—The Comptroller General of the United States

shall conduct a study on the aggregate effects of regulatory,

audit, oversight, and paperwork burdens on physicians and

other health care providers participating in the medicare program under title XVIII of the Social Security Act.

(2) REPORT.—Not later than 18 months after the date of

the enactment of this Act, the Comptroller General shall submit

to Congress a report on the study conducted under paragraph

(1) together with recommendations regarding any area in

which—

(A) a reduction in paperwork, an ease of administration, or an appropriate change in oversight and review

may be accomplished; or

(B) additional payments or education are needed to

assist physicians and other health care providers in understanding and complying with any legal or regulatory

requirements.

SEC. 438. MEDPAC STUDY ON ACCESS TO OUTPATIENT PAIN MANAGEMENT SERVICES.

(a) STUDY.—The Medicare Payment Advisory Commission shall

conduct a study on the barriers to coverage and payment for outpatient interventional pain medicine procedures under the medicare

program under title XVIII of the Social Security Act. Such study

shall examine—

(1) the specific barriers imposed under the medicare program on the provision of pain management procedures in hospital outpatient departments, ambulatory surgery centers, and

physicians’ offices; and

(2) the consistency of medicare payment policies for pain

management procedures in those different settings.

(b) REPORT.—Not later than 1 year after the date of the enactment of this Act, the Commission shall submit to Congress a report

on the study.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–529

TITLE V—PROVISIONS RELATING TO

PARTS A AND B

Subtitle A—Home Health Services

SEC. 501. ONE-YEAR ADDITIONAL DELAY IN APPLICATION OF 15 PERCENT REDUCTION ON PAYMENT LIMITS FOR HOME

HEALTH SERVICES.

(a) IN GENERAL.—Section 1895(b)(3)(A)(i) (42 U.S.C.

1395fff(b)(3)(A)(i)) is amended—

(1) by redesignating subclause (II) as subclause (III);

(2) in subclause (III), as redesignated, by striking

‘‘described in subclause (I)’’ and inserting ‘‘described in subclause (II)’’; and

(3) by inserting after subclause (I) the following new subclause:

‘‘(II) For the 12-month period beginning after

the period described in subclause (I), such amount

(or amounts) shall be equal to the amount (or

amounts) determined under subclause (I), updated

under subparagraph (B).’’.

(b) CHANGE IN REPORT.—Section 302(c) of BBRA (113 Stat.

1501A–360) is amended—

(1) by striking ‘‘Not later than’’ and all that follows through

‘‘(42 U.S.C. 1395fff )’’ and inserting ‘‘Not later than April 1,

2002’’; and

(2) by striking ‘‘Secretary’’ and inserting ‘‘Comptroller General of the United States’’.

(c) CASE MIX ADJUSTMENT CORRECTIONS.—

(1) IN GENERAL.—Section 1895(b)(3)(B) (42 U.S.C.

1395fff(b)(3)(B)) is amended by adding at the end the following

new clause:

‘‘(iv) ADJUSTMENT FOR CASE MIX CHANGES.—Insofar

as the Secretary determines that the adjustments

under paragraph (4)(A)(i) for a previous fiscal year

(or estimates that such adjustments for a future fiscal

year) did (or are likely to) result in a change in aggregate payments under this subsection during the fiscal

year that are a result of changes in the coding or

classification of different units of services that do not

reflect real changes in case mix, the Secretary may

adjust the standard prospective payment amount (or

amounts) under paragraph (3) for subsequent fiscal

years so as to eliminate the effect of such coding or

classification changes.’’. (2) EFFECTIVE DATE.—The amendment made by paragraph

(1) shall apply to episodes concluding on or after October 1,

2001.

SEC. 502. RESTORATION OF FULL HOME HEALTH MARKET BASKET

UPDATE FOR HOME HEALTH SERVICES FOR FISCAL YEAR

2001.

(a) IN GENERAL.—Section 1861(v)(1)(L)(x) (42 U.S.C.

1395x(v)(1)(L)(x)) is amended—

(1) by striking ‘‘2001,’’; and

114 STAT. 2763A–530 PUBLIC LAW 106–554—APPENDIX F

(2) by adding at the end the following: ‘‘With respect to

cost reporting periods beginning during fiscal year 2001, the

update to any limit under this subparagraph shall be the home

health market basket index.’’.

(b) SPECIAL RULE FOR PAYMENT FOR FISCAL YEAR 2001 BASED

ON ADJUSTED PROSPECTIVE PAYMENT AMOUNTS.— (1) IN GENERAL.—Notwithstanding the amendments made

by subsection (a), for purposes of making payments under section 1895(b) of the Social Security Act (42 U.S.C. 1395fff(b))

for home health services furnished during fiscal year 2001,

the Secretary of Health and Human Services shall— (A) with respect to episodes and visits ending on or

after October 1, 2000, and before April 1, 2001, use the

final standardized and budget neutral prospective payment

amounts for 60-day episodes and standardized average per

visit amounts for fiscal year 2001 as published by the

Secretary in the Federal Register on July 3, 2000 (65

Fed. Reg. 41128–41214); and

(B) with respect to episodes and visits ending on or

after April 1, 2001, and before October 1, 2001, use such

amounts increased by 2.2 percent.

(2) NO EFFECT ON OTHER PAYMENTS OR DETERMINATIONS.—

The Secretary shall not take the provisions of paragraph (1)

into account for purposes of payments, determinations, or

budget neutrality adjustments under section 1895 of the Social

Security Act.

SEC. 503. TEMPORARY TWO-MONTH PERIODIC INTERIM PAYMENT.

(a) IN GENERAL.—Notwithstanding the amendments made by

section 4603(b) of BBA (42 U.S.C. 1395fff note), in the case of

a home health agency that was receiving periodic interim payments

under section 1815(e)(2) of the Social Security Act (42 U.S.C.

1395g(e)(2)) as of September 30, 2000, and that is not described

in subsection (b), the Secretary of Health and Human Services

shall, as soon as practicable, make a single periodic interim payment

to such agency in an amount equal to four times the last full

fortnightly periodic interim payment made to such agency under

the payment system in effect prior to the implementation of the

prospective payment system under section 1895(b) of such Act (42

U.S.C. 1395fff(b)). Such amount of such periodic interim payment

shall be included in the tentative settlement of the last cost report

for the home health agency under the payment system in effect

prior to the implementation of such prospective payment system,

regardless of the ending date of such cost report.

(b) EXCEPTIONS.—The Secretary shall not make an additional

periodic interim payment under subsection (a) in the case of a

home health agency (determined as of the day that such payment

would otherwise be made) that—

(1) notifies the Secretary that such agency does not want

to receive such payment;

(2) is not receiving payments pursuant to section 405.371

of title 42, Code of Federal Regulations;

(3) is excluded from the medicare program under title

XI of the Social Security Act;

(4) no longer has a provider agreement under section 1866

of such Act (42 U.S.C. 1395cc);

(5) is no longer in business; or

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–531

(6) is subject to a court order providing for the withholding

of medicare payments under title XVIII of such Act.

SEC. 504. USE OF TELEHEALTH IN DELIVERY OF HOME HEALTH SERVICES.

Section 1895 (42 U.S.C. 1395fff ) is amended by adding at

the end the following new subsection: ‘‘(e) CONSTRUCTION RELATED TO HOME HEALTH SERVICES.— ‘‘(1) TELECOMMUNICATIONS.—Nothing in this section shall

be construed as preventing a home health agency furnishing

a home health unit of service for which payment is made

under the prospective payment system established by this section for such units of service from furnishing services via a

telecommunication system if such services— ‘‘(A) do not substitute for in-person home health services ordered as part of a plan of care certified by a physician

pursuant to section 1814(a)(2)(C) or 1835(a)(2)(A); and ‘‘(B) are not considered a home health visit for purposes

of eligibility or payment under this title.

‘‘(2) PHYSICIAN CERTIFICATION.—Nothing in this section

shall be construed as waiving the requirement for a physician

certification under section 1814(a)(2)(C) or 1835(a)(2)(A) of such

Act (42 U.S.C. 1395f(a)(2)(C), 1395n(a)(2)(A)) for the payment

for home health services, whether or not furnished via a telecommunications system.’’.

SEC. 505. STUDY ON COSTS TO HOME HEALTH AGENCIES OF PURCHASING NONROUTINE MEDICAL SUPPLIES.

(a) STUDY.—The Comptroller General of the United States shall

conduct a study on variations in prices paid by home health agencies

furnishing home health services under the medicare program under

title XVIII of the Social Security Act in purchasing nonroutine

medical supplies, including ostomy supplies, and volumes of such

supplies used, shall determine the effect (if any) of variations on

prices and volumes in the provision of such services.

(b) REPORT.—Not later than August 15, 2001, the Comptroller

General shall submit to Congress a report on the study conducted

under subsection (a), and shall include in the report recommendations respecting whether payment for nonroutine medical supplies

furnished in connection with home health services should be made

separately from the prospective payment system for such services.

SEC. 506. TREATMENT OF BRANCH OFFICES; GAO STUDY ON SUPERVISION OF HOME HEALTH CARE PROVIDED IN ISOLATED

RURAL AREAS.

(a) TREATMENT OF BRANCH OFFICES.—

(1) IN GENERAL.—Notwithstanding any other provision of

law, in determining for purposes of title XVIII of the Social

Security Act whether an office of a home health agency constitutes a branch office or a separate home health agency,

neither the time nor distance between a parent office of the

home health agency and a branch office shall be the sole

determinant of a home health agency’s branch office status.

(2) CONSIDERATION OF FORMS OF TECHNOLOGY IN DEFINITION OF SUPERVISION.—The Secretary of Health and Human

Services may include forms of technology in determining what

constitutes ‘‘supervision’’ for purposes of determining a home

heath agency’s branch office status under paragraph (1).

114 STAT. 2763A–532 PUBLIC LAW 106–554—APPENDIX F

(b) GAO STUDY.— (1) STUDY.—The Comptroller General of the United States

shall conduct a study of the provision of adequate supervision

to maintain quality of home health services delivered under

the medicare program under title XVIII of the Social Security

Act in isolated rural areas. The study shall evaluate the methods that home health agency branches and subunits use to

maintain adequate supervision in the delivery of services to

clients residing in those areas, how these methods of supervision compare to requirements that subunits independently

meet medicare conditions of participation, and the resources

utilized by subunits to meet such conditions.

(2) REPORT.—Not later than January 1, 2002, the Comptroller General shall submit to Congress a report on the study

conducted under paragraph (1). The report shall include recommendations on whether exceptions are needed for subunits

and branches of home health agencies under the medicare

program to maintain access to the home health benefit or

whether alternative policies should be developed to assure adequate supervision and access and recommendations on whether

a national standard for supervision is appropriate.

SEC. 507. CLARIFICATION OF THE HOMEBOUND DEFINITION UNDER

THE MEDICARE HOME HEALTH BENEFIT.

(a) CLARIFICATION.—

(1) IN GENERAL.—Sections 1814(a) and 1835(a) (42 U.S.C.

1395f(a) and 1395n(a)) are each amended—

(A) in the last sentence, by striking ‘‘, and that absences

of the individual from home are infrequent or of relatively

short duration, or are attributable to the need to receive

medical treatment’’; and

(B) by adding at the end the following new sentences:

‘‘Any absence of an individual from the home attributable

to the need to receive health care treatment, including

regular absences for the purpose of participating in therapeutic, psychosocial, or medical treatment in an adult daycare program that is licensed or certified by a State, or

accredited, to furnish adult day-care services in the State

shall not disqualify an individual from being considered

to be ‘confined to his home’. Any other absence of an

individual from the home shall not so disqualify an individual if the absence is of infrequent or of relatively short

duration. For purposes of the preceding sentence, any

absence for the purpose of attending a religious service

shall be deemed to be an absence of infrequent or short

duration.’’.

(2) EFFECTIVE DATE.—The amendments made by paragraph

(1) shall apply to home health services furnished on or after

the date of the enactment of this Act.

(b) STUDY.—

(1) IN GENERAL.—The Comptroller General of the United

States shall conduct an evaluation of the effect of the amendment on the cost of and access to home health services under

the medicare program under title XVIII of the Social Security

Act.

(2) REPORT.—Not later than 1 year after the date of the

enactment of this Act, the Comptroller General shall submit

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–533

to Congress a report on the study conducted under paragraph

(1).

SEC. 508. TEMPORARY INCREASE FOR HOME HEALTH SERVICES FURNISHED IN A RURAL AREA.

(a) 24-MONTH INCREASE BEGINNING APRIL 1, 2001.—In the

case of home health services furnished in a rural area (as defined

in section 1886(d)(2)(D) of the Social Security Act (42 U.S.C.

1395ww(d)(2)(D))) on or after April 1, 2001, and before April 1,

2003, the Secretary of Health and Human Services shall increase

the payment amount otherwise made under section 1895 of such

Act (42 U.S.C. 1395fff ) for such services by 10 percent.

(b) WAIVING BUDGET NEUTRALITY.—The Secretary shall not

reduce the standard prospective payment amount (or amounts)

under section 1895 of the Social Security Act (42 U.S.C. 1395fff )

applicable to home health services furnished during a period to

offset the increase in payments resulting from the application of

subsection (a).

Subtitle B—Direct Graduate Medical

Education

SEC. 511. INCREASE IN FLOOR FOR DIRECT GRADUATE MEDICAL EDUCATION PAYMENTS.

Section 1886(h)(2)(D)(iii) (42 U.S.C. 1395ww(h)(2)(D)(iii)) is

amended—

(1) in the heading, by striking ‘‘IN FISCAL YEAR 2001 AT

70 PERCENT OF’’ and inserting ‘‘FOR’’; and

(2) by inserting after ‘‘70 percent’’ the following: ‘‘, and

for the cost reporting period beginning during fiscal year 2002

shall not be less than 85 percent,’’.

SEC. 512. CHANGE IN DISTRIBUTION FORMULA FOR

MEDICARE+CHOICE-RELATED NURSING AND ALLIED

HEALTH EDUCATION COSTS.

(a) IN GENERAL.—Section 1886(l)(2)(C) (42 U.S.C.

1395ww(l)(2)(C)) is amended by striking all that follows ‘‘multiplied

by’’ and inserting the following: ‘‘the ratio of—

‘‘(i) the product of (I) the Secretary’s estimate of

the ratio of the amount of payments made under section 1861(v) to the hospital for nursing and allied

health education activities for the hospital’s cost reporting period ending in the second preceding fiscal year,

to the hospital’s total inpatient days for such period,

and (II) the total number of inpatient days (as established by the Secretary) for such period which are

attributable to services furnished to individuals who

are enrolled under a risk sharing contract with an

eligible organization under section 1876 and who are

entitled to benefits under part A or who are enrolled

with a Medicare+Choice organization under part C;

to

‘‘(ii) the sum of the products determined under

clause (i) for such cost reporting periods.’’.

114 STAT. 2763A–534 PUBLIC LAW 106–554—APPENDIX F

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to portions of cost reporting periods occurring on or

after January 1, 2001.

Subtitle C—Changes in Medicare Coverage

and Appeals Process

SEC. 521. REVISIONS TO MEDICARE APPEALS PROCESS.

(a) CONDUCT OF RECONSIDERATIONS OF DETERMINATIONS BY

INDEPENDENT CONTRACTORS.—Section 1869 (42 U.S.C. 1395ff ) is

amended to read as follows:

‘‘DETERMINATIONS; APPEALS

‘‘SEC. 1869. (a) INITIAL DETERMINATIONS.—

‘‘(1) PROMULGATIONS OF REGULATIONS.—The Secretary shall

promulgate regulations and make initial determinations with

respect to benefits under part A or part B in accordance with

those regulations for the following:

‘‘(A) The initial determination of whether an individual

is entitled to benefits under such parts.

‘‘(B) The initial determination of the amount of benefits

available to the individual under such parts.

‘‘(C) Any other initial determination with respect to

a claim for benefits under such parts, including an initial

determination by the Secretary that payment may not be

made, or may no longer be made, for an item or service

under such parts, an initial determination made by a utilization and quality control peer review organization under

section 1154(a)(2), and an initial determination made by

an entity pursuant to a contract (other than a contract

under section 1852) with the Secretary to administer provisions of this title or title XI.

‘‘(2) DEADLINES FOR MAKING INITIAL DETERMINATIONS.—

‘‘(A) IN GENERAL.—Subject to subparagraph (B), in

promulgating regulations under paragraph (1), initial

determinations shall be concluded by not later than the

45-day period beginning on the date the fiscal intermediary

or the carrier, as the case may be, receives a claim for

benefits from an individual as described in paragraph (1).

Notice of such determination shall be mailed to the individual filing the claim before the conclusion of such 45-day

period.

‘‘(B) CLEAN CLAIMS.—Subparagraph (A) shall not apply

with respect to any claim that is subject to the requirements of section 1816(c)(2) or 1842(c)(2).

‘‘(3) REDETERMINATIONS.—

‘‘(A) IN GENERAL.—In promulgating regulations under

paragraph (1) with respect to initial determinations, such

regulations shall provide for a fiscal intermediary or a

carrier to make a redetermination with respect to a claim

for benefits that is denied in whole or in part.

‘‘(B) LIMITATIONS.— ‘‘(i) APPEAL RIGHTS.—No initial determination may

be reconsidered or appealed under subsection (b) unless

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–535

the fiscal intermediary or carrier has made a redetermination of that initial determination under this paragraph. ‘‘(ii) DECISIONMAKER.—No redetermination may be

made by any individual involved in the initial determination.

‘‘(C) DEADLINES.— ‘‘(i) FILING FOR REDETERMINATION.—A redetermination under subparagraph (A) shall be available

only if notice is filed with the Secretary to request

the redetermination by not later than the end of the

120-day period beginning on the date the individual

receives notice of the initial determination under paragraph (2). ‘‘(ii) CONCLUDING REDETERMINATIONS.—Redeterminations shall be concluded by not later than the

30-day period beginning on the date the fiscal intermediary or the carrier, as the case may be, receives

a request for a redetermination. Notice of such determination shall be mailed to the individual filing the

claim before the conclusion of such 30-day period.

‘‘(D) CONSTRUCTION.—For purposes of the succeeding

provisions of this section a redetermination under this

paragraph shall be considered to be part of the initial

determination.

‘‘(b) APPEAL RIGHTS.—

‘‘(1) IN GENERAL.—

‘‘(A) RECONSIDERATION OF INITIAL DETERMINATION.—

Subject to subparagraph (D), any individual dissatisfied

with any initial determination under subsection (a)(1) shall

be entitled to reconsideration of the determination, and,

subject to subparagraphs (D) and (E), a hearing thereon

by the Secretary to the same extent as is provided in

section 205(b) and to judicial review of the Secretary’s

final decision after such hearing as is provided in section

205(g). For purposes of the preceding sentence, any reference to the ‘Commissioner of Social Security’ or the ‘Social

Security Administration’ in subsection (g) or (l) of section

205 shall be considered a reference to the ‘Secretary’ or

the ‘Department of Health and Human Services’, respectively.

‘‘(B) REPRESENTATION BY PROVIDER OR SUPPLIER.—

‘‘(i) IN GENERAL.—Sections 206(a), 1102, and 1871

shall not be construed as authorizing the Secretary

to prohibit an individual from being represented under

this section by a person that furnishes or supplies

the individual, directly or indirectly, with services or

items, solely on the basis that the person furnishes

or supplies the individual with such a service or item.

‘‘(ii) MANDATORY WAIVER OF RIGHT TO PAYMENT

FROM BENEFICIARY.—Any person that furnishes services or items to an individual may not represent an

individual under this section with respect to the issue

described in section 1879(a)(2) unless the person has

waived any rights for payment from the beneficiary

with respect to the services or items involved in the

appeal.

114 STAT. 2763A–536 PUBLIC LAW 106–554—APPENDIX F

‘‘(iii) PROHIBITION ON PAYMENT FOR REPRESENTA- TION.—If a person furnishes services or items to an

individual and represents the individual under this

section, the person may not impose any financial liability on such individual in connection with such representation.

‘‘(iv) REQUIREMENTS FOR REPRESENTATIVES OF A

BENEFICIARY.—The provisions of section 205( j) and of

section 206 (other than subsection (a)(4) of such section) regarding representation of claimants shall apply

to representation of an individual with respect to

appeals under this section in the same manner as

they apply to representation of an individual under

those sections.

‘‘(C) SUCCESSION OF RIGHTS IN CASES OF ASSIGNMENT.— The right of an individual to an appeal under this section

with respect to an item or service may be assigned to

the provider of services or supplier of the item or service

upon the written consent of such individual using a standard form established by the Secretary for such an assignment.‘‘(D) TIME LIMITS FOR FILING APPEALS.—

‘‘(i) RECONSIDERATIONS.—Reconsideration under

subparagraph (A) shall be available only if the individual described in subparagraph (A) files notice with

the Secretary to request reconsideration by not later

than the end of the 180-day period beginning on the

date the individual receives notice of the redetermination under subsection (a)(3), or within such additional

time as the Secretary may allow.

‘‘(ii) HEARINGS CONDUCTED BY THE SECRETARY.—

The Secretary shall establish in regulations time limits

for the filing of a request for a hearing by the Secretary

in accordance with provisions in sections 205 and 206.

‘‘(E) AMOUNTS IN CONTROVERSY.— ‘‘(i) IN GENERAL.—A hearing (by the Secretary)

shall not be available to an individual under this section if the amount in controversy is less than $100,

and judicial review shall not be available to the individual if the amount in controversy is less than $1,000.

‘‘(ii) AGGREGATION OF CLAIMS.—In determining the

amount in controversy, the Secretary, under regulations, shall allow two or more appeals to be aggregated

if the appeals involve—

‘‘(I) the delivery of similar or related services

to the same individual by one or more providers

of services or suppliers, or

‘‘(II) common issues of law and fact arising

from services furnished to two or more individuals

by one or more providers of services or suppliers.

‘‘(F) EXPEDITED PROCEEDINGS.— ‘‘(i) EXPEDITED DETERMINATION.—In the case of an

individual who has received notice from a provider

of services that such provider plans—

‘‘(I) to terminate services provided to an

individual and a physician certifies that failure

to continue the provision of such services is likely

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–537

to place the individual’s health at significant risk,

or ‘‘(II) to discharge the individual from the provider of services,

the individual may request, in writing or orally, an

expedited determination or an expedited reconsideration of an initial determination made under subsection (a)(1), as the case may be, and the Secretary

shall provide such expedited determination or expedited reconsideration.

‘‘(ii) EXPEDITED HEARING.—In a hearing by the Secretary under this section, in which the moving party

alleges that no material issues of fact are in dispute,

the Secretary shall make an expedited determination

as to whether any such facts are in dispute and, if

not, shall render a decision expeditiously.

‘‘(G) REOPENING AND REVISION OF DETERMINATIONS.—

The Secretary may reopen or revise any initial determination or reconsidered determination described in this subsection under guidelines established by the Secretary in

regulations.

‘‘(c) CONDUCT OF RECONSIDERATIONS BY INDEPENDENT CONTRACTORS.—

‘‘(1) IN GENERAL.—The Secretary shall enter into contracts

with qualified independent contractors to conduct reconsiderations of initial determinations made under subparagraphs (B)

and (C) of subsection (a)(1). Contracts shall be for an initial

term of three years and shall be renewable on a triennial

basis thereafter.

‘‘(2) QUALIFIED INDEPENDENT CONTRACTOR.—For purposes

of this subsection, the term ‘qualified independent contractor’

means an entity or organization that is independent of any

organization under contract with the Secretary that makes

initial determinations under subsection (a)(1), and that meets

the requirements established by the Secretary consistent with

paragraph (3).

‘‘(3) REQUIREMENTS.—Any qualified independent contractor

entering into a contract with the Secretary under this subsection shall meet all of the following requirements:

‘‘(A) IN GENERAL.—The qualified independent contractor shall perform such duties and functions and assume

such responsibilities as may be required by the Secretary

to carry out the provisions of this subsection, and shall

have sufficient training and expertise in medical science

and legal matters to make reconsiderations under this subsection.

‘‘(B) RECONSIDERATIONS.—

‘‘(i) IN GENERAL.—The qualified independent contractor shall review initial determinations. Where an

initial determination is made with respect to whether

an item or service is reasonable and necessary for

the diagnosis or treatment of illness or injury (under

section 1862(a)(1)(A)), such review shall include consideration of the facts and circumstances of the initial

determination by a panel of physicians or other appropriate health care professionals and any decisions with

respect to the reconsideration shall be based on

114 STAT. 2763A–538 PUBLIC LAW 106–554—APPENDIX F

applicable information, including clinical experience

and medical, technical, and scientific evidence. ‘‘(ii) EFFECT OF NATIONAL AND LOCAL COVERAGE

DETERMINATIONS.— ‘‘(I) NATIONAL COVERAGE DETERMINATIONS.— If the Secretary has made a national coverage

determination pursuant to the requirements established under the third sentence of section 1862(a),

such determination shall be binding on the qualified independent contractor in making a decision

with respect to a reconsideration under this section.‘‘(II) LOCAL COVERAGE DETERMINATIONS.—If

the Secretary has made a local coverage determination, such determination shall not be binding

on the qualified independent contractor in making

a decision with respect to a reconsideration under

this section. Notwithstanding the previous sentence, the qualified independent contractor shall

consider the local coverage determination in making such decision. ‘‘(III) ABSENCE OF NATIONAL OR LOCAL COVERAGE DETERMINATION.—In the absence of such

a national coverage determination or local coverage

determination, the qualified independent contractor shall make a decision with respect to the

reconsideration based on applicable information,

including clinical experience and medical, technical, and scientific evidence.

‘‘(C) DEADLINES FOR DECISIONS.—

‘‘(i) RECONSIDERATIONS.—Except as provided in

clauses (iii) and (iv), the qualified independent contractor shall conduct and conclude a reconsideration under

subparagraph (B), and mail the notice of the decision

with respect to the reconsideration by not later than

the end of the 30-day period beginning on the date

a request for reconsideration has been timely filed.

‘‘(ii) CONSEQUENCES OF FAILURE TO MEET DEADLINE.—In the case of a failure by the qualified

independent contractor to mail the notice of the decision by the end of the period described in clause (i)

or to provide notice by the end of the period described

in clause (iii), as the case may be, the party requesting

the reconsideration or appeal may request a hearing

before the Secretary, notwithstanding any requirements for a reconsidered determination for purposes

of the party’s right to such hearing.

‘‘(iii) EXPEDITED RECONSIDERATIONS.—The qualified independent contractor shall perform an expedited

reconsideration under subsection (b)(1)(F) as follows:

‘‘(I) DEADLINE FOR DECISION.—Notwithstanding section 216( j) and subject to clause (iv), not

later than the end of the 72-hour period beginning

on the date the qualified independent contractor

has received a request for such reconsideration

and has received such medical or other records

needed for such reconsideration, the qualified

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–539

independent contractor shall provide notice (by

telephone and in writing) to the individual and

the provider of services and attending physician

of the individual of the results of the reconsideration. Such reconsideration shall be conducted

regardless of whether the provider of services or

supplier will charge the individual for continued

services or whether the individual will be liable

for payment for such continued services.

‘‘(II) CONSULTATION WITH BENEFICIARY.—In

such reconsideration, the qualified independent

contractor shall solicit the views of the individual

involved. ‘‘(III) SPECIAL RULE FOR HOSPITAL DIS- CHARGES.—A reconsideration of a discharge from

a hospital shall be conducted under this clause

in accordance with the provisions of paragraphs

(2), (3), and (4) of section 1154(e) as in effect on

the date that precedes the date of the enactment

of this subparagraph.

‘‘(iv) EXTENSION.—An individual requesting a

reconsideration under this subparagraph may be

granted such additional time as the individual specifies

(not to exceed 14 days) for the qualified independent

contractor to conclude the reconsideration. The individual may request such additional time orally or in writing.

‘‘(D) LIMITATION ON INDIVIDUAL REVIEWING DETERMINATIONS.—

‘‘(i) PHYSICIANS AND HEALTH CARE PROFESSIONAL.—

No physician or health care professional under the

employ of a qualified independent contractor may

review—

‘‘(I) determinations regarding health care services furnished to a patient if the physician or

health care professional was directly responsible

for furnishing such services; or

‘‘(II) determinations regarding health care

services provided in or by an institution, organization, or agency, if the physician or any member

of the family of the physician or health care professional has, directly or indirectly, a significant

financial interest in such institution, organization,

or agency.

‘‘(ii) FAMILY DESCRIBED.—For purposes of this

paragraph, the family of a physician or health care

professional includes the spouse (other than a spouse

who is legally separated from the physician or health

care professional under a decree of divorce or separate

maintenance), children (including stepchildren and

legally adopted children), grandchildren, parents, and

grandparents of the physician or health care professional.

‘‘(E) EXPLANATION OF DECISION.—Any decision with

respect to a reconsideration of a qualified independent contractor shall be in writing, and shall include a detailed

explanation of the decision as well as a discussion of the

114 STAT. 2763A–540 PUBLIC LAW 106–554—APPENDIX F

pertinent facts and applicable regulations applied in making such decision, and in the case of a determination of

whether an item or service is reasonable and necessary

for the diagnosis or treatment of illness or injury (under

section 1862(a)(1)(A)) an explanation of the medical and

scientific rationale for the decision.

‘‘(F) NOTICE REQUIREMENTS.—Whenever a qualified

independent contractor makes a decision with respect to

a reconsideration under this subsection, the qualified

independent contractor shall promptly notify the entity

responsible for the payment of claims under part A or

part B of such decision.

‘‘(G) DISSEMINATION OF DECISIONS ON RECONSIDERATIONS.—Each qualified independent contractor shall make

available all decisions with respect to reconsiderations of

such qualified independent contractors to fiscal intermediaries (under section 1816), carriers (under section

1842), peer review organizations (under part B of title

XI), Medicare+Choice organizations offering

Medicare+Choice plans under part C, other entities under

contract with the Secretary to make initial determinations

under part A or part B or title XI, and to the public.

The Secretary shall establish a methodology under which

qualified independent contractors shall carry out this

subparagraph.

‘‘(H) ENSURING CONSISTENCY IN DECISIONS.—Each

qualified independent contractor shall monitor its decisions

with respect to reconsiderations to ensure the consistency

of such decisions with respect to requests for reconsideration of similar or related matters.

‘‘(I) DATA COLLECTION.—

‘‘(i) IN GENERAL.—Consistent with the requirements of clause (ii), a qualified independent contractor

shall collect such information relevant to its functions,

and keep and maintain such records in such form

and manner as the Secretary may require to carry

out the purposes of this section and shall permit access

to and use of any such information and records as

the Secretary may require for such purposes.

‘‘(ii) TYPE OF DATA COLLECTED.—Each qualified

independent contractor shall keep accurate records of

each decision made, consistent with standards established by the Secretary for such purpose. Such records

shall be maintained in an electronic database in a

manner that provides for identification of the following:

‘‘(I) Specific claims that give rise to appeals.

‘‘(II) Situations suggesting the need for

increased education for providers of services, physicians, or suppliers.

‘‘(III) Situations suggesting the need for

changes in national or local coverage policy.

‘‘(IV) Situations suggesting the need for

changes in local medical review policies.

‘‘(iii) ANNUAL REPORTING.—Each qualified

independent contractor shall submit annually to the

Secretary (or otherwise as the Secretary may request)

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–541

records maintained under this paragraph for the previous year.

‘‘(J) HEARINGS BY THE SECRETARY.—The qualified

independent contractor shall (i) prepare such information

as is required for an appeal of a decision of the contractor

with respect to a reconsideration to the Secretary for a

hearing, including as necessary, explanations of issues

involved in the decision and relevant policies, and (ii)

participate in such hearings as required by the Secretary.

‘‘(4) NUMBER OF QUALIFIED INDEPENDENT CONTRACTORS.—

The Secretary shall enter into contracts with not fewer than

12 qualified independent contractors under this subsection.

‘‘(5) LIMITATION ON QUALIFIED INDEPENDENT CONTRACTOR

LIABILITY.—No qualified independent contractor having a contract with the Secretary under this subsection and no person

who is employed by, or who has a fiduciary relationship with,

any such qualified independent contractor or who furnishes

professional services to such qualified independent contractor,

shall be held by reason of the performance of any duty, function,

or activity required or authorized pursuant to this subsection

or to a valid contract entered into under this subsection, to

have violated any criminal law, or to be civilly liable under

any law of the United States or of any State (or political

subdivision thereof ) provided due care was exercised in the

performance of such duty, function, or activity.

‘‘(d) DEADLINES FOR HEARINGS BY THE SECRETARY.—

‘‘(1) HEARING BY ADMINISTRATIVE LAW JUDGE.—

‘‘(A) IN GENERAL.—Except as provided in subparagraph

(B), an administrative law judge shall conduct and conclude

a hearing on a decision of a qualified independent contractor under subsection (c) and render a decision on such

hearing by not later than the end of the 90-day period

beginning on the date a request for hearing has been

timely filed.

‘‘(B) WAIVER OF DEADLINE BY PARTY SEEKING HEARING.—The 90-day period under subparagraph (A) shall not

apply in the case of a motion or stipulation by the party

requesting the hearing to waive such period.

‘‘(2) DEPARTMENTAL APPEALS BOARD REVIEW.—

‘‘(A) IN GENERAL.—The Departmental Appeals Board

of the Department of Health and Human Services shall

conduct and conclude a review of the decision on a hearing

described in paragraph (1) and make a decision or remand

the case to the administrative law judge for reconsideration

by not later than the end of the 90-day period beginning

on the date a request for review has been timely filed.

‘‘(B) DAB HEARING PROCEDURE.—In reviewing a decision on a hearing under this paragraph, the Departmental

Appeals Board shall review the case de novo.

‘‘(3) CONSEQUENCES OF FAILURE TO MEET DEADLINES.—

‘‘(A) HEARING BY ADMINISTRATIVE LAW JUDGE.—In the

case of a failure by an administrative law judge to render

a decision by the end of the period described in paragraph

(1), the party requesting the hearing may request a review

by the Departmental Appeals Board of the Department

of Health and Human Services, notwithstanding any

114 STAT. 2763A–542 PUBLIC LAW 106–554—APPENDIX F

requirements for a hearing for purposes of the party’s

right to such a review.

‘‘(B) DEPARTMENTAL APPEALS BOARD REVIEW.—In the

case of a failure by the Departmental Appeals Board to

render a decision by the end of the period described in

paragraph (2), the party requesting the hearing may seek

judicial review, notwithstanding any requirements for a

hearing for purposes of the party’s right to such judicial

review.

‘‘(e) ADMINISTRATIVE PROVISIONS.—

‘‘(1) LIMITATION ON REVIEW OF CERTAIN REGULATIONS.—

A regulation or instruction that relates to a method for determining the amount of payment under part B and that was

initially issued before January 1, 1981, shall not be subject

to judicial review.

‘‘(2) OUTREACH.—The Secretary shall perform such outreach activities as are necessary to inform individuals entitled

to benefits under this title and providers of services and suppliers with respect to their rights of, and the process for, appeals

made under this section. The Secretary shall use the tollfree telephone number maintained by the Secretary under section 1804(b) to provide information regarding appeal rights

and respond to inquiries regarding the status of appeals.

‘‘(3) CONTINUING EDUCATION REQUIREMENT FOR QUALIFIED

INDEPENDENT CONTRACTORS AND ADMINISTRATIVE LAW

JUDGES.—The Secretary shall provide to each qualified

independent contractor, and, in consultation with the Commissioner of Social Security, to administrative law judges that

decide appeals of reconsiderations of initial determinations or

other decisions or determinations under this section, such

continuing education with respect to coverage of items and

services under this title or policies of the Secretary with respect

to part B of title XI as is necessary for such qualified independent contractors and administrative law judges to make informed

decisions with respect to appeals.

‘‘(4) REPORTS.—

‘‘(A) ANNUAL REPORT TO CONGRESS.—The Secretary

shall submit to Congress an annual report describing the

number of appeals for the previous year, identifying issues

that require administrative or legislative actions, and

including any recommendations of the Secretary with

respect to such actions. The Secretary shall include in

such report an analysis of determinations by qualified

independent contractors with respect to inconsistent

decisions and an analysis of the causes of any such

inconsistencies.

‘‘(B) SURVEY.—Not less frequently than every 5 years,

the Secretary shall conduct a survey of a valid sample

of individuals entitled to benefits under this title who have

filed appeals of determinations under this section, providers

of services, and suppliers to determine the satisfaction

of such individuals or entities with the process for appeals

of determinations provided for under this section and education and training provided by the Secretary with respect

to that process. The Secretary shall submit to Congress

a report describing the results of the survey, and shall

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–543

include any recommendations for administrative or legislative actions that the Secretary determines appropriate.’’.

(b) APPLICABILITY OF REQUIREMENTS AND LIMITATIONS ON

LIABILITY OF QUALIFIED INDEPENDENT CONTRACTORS TO

MEDICARE+CHOICE INDEPENDENT APPEALS CONTRACTORS.—Section

1852(g)(4) (42 U.S.C. 1395w–22(g)(4)) is amended by adding at

the end the following: ‘‘The provisions of section 1869(c)(5) shall

apply to independent outside entities under contract with the Secretary under this paragraph.’’.

(c) CONFORMING AMENDMENT.—Section 1154(e) (42 U.S.C.

1320c–3(e)) is amended by striking paragraphs (2), (3), and (4).

(d) EFFECTIVE DATE.—The amendments made by this section

shall apply with respect to initial determinations made on or after

October 1, 2002.

SEC. 522. REVISIONS TO MEDICARE COVERAGE PROCESS.

(a) REVIEW OF DETERMINATIONS.—Section 1869 (42 U.S.C.

1395ff ), as amended by section 521, is further amended by adding

at the end the following new subsection:

‘‘(f ) REVIEW OF COVERAGE DETERMINATIONS.—

‘‘(1) NATIONAL COVERAGE DETERMINATIONS.—

‘‘(A) IN GENERAL.—Review of any national coverage

determination shall be subject to the following limitations:

‘‘(i) Such a determination shall not be reviewed

by any administrative law judge.

‘‘(ii) Such a determination shall not be held unlawful or set aside on the ground that a requirement

of section 553 of title 5, United States Code, or section

1871(b) of this title, relating to publication in the Federal Register or opportunity for public comment, was

not satisfied.

‘‘(iii) Upon the filing of a complaint by an aggrieved

party, such a determination shall be reviewed by the

Departmental Appeals Board of the Department of

Health and Human Services. In conducting such a

review, the Departmental Appeals Board—

‘‘(I) shall review the record and shall permit

discovery and the taking of evidence to evaluate

the reasonableness of the determination, if the

Board determines that the record is incomplete

or lacks adequate information to support the validity of the determination;

‘‘(II) may, as appropriate, consult with appropriate scientific and clinical experts; and

‘‘(III) shall defer only to the reasonable findings of fact, reasonable interpretations of law, and

reasonable applications of fact to law by the Secretary.

‘‘(iv) The Secretary shall implement a decision of

the Departmental Appeals Board within 30 days of

receipt of such decision.

‘‘(v) A decision of the Departmental Appeals Board

constitutes a final agency action and is subject to

judicial review.

114 STAT. 2763A–544 PUBLIC LAW 106–554—APPENDIX F

‘‘(B) DEFINITION OF NATIONAL COVERAGE DETERMINATION.—For purposes of this section, the term ‘national coverage determination’ means a determination by the Secretary with respect to whether or not a particular item

or service is covered nationally under this title, but does

not include a determination of what code, if any, is assigned

to a particular item or service covered under this title

or a determination with respect to the amount of payment

made for a particular item or service so covered.

‘‘(2) LOCAL COVERAGE DETERMINATION.—

‘‘(A) IN GENERAL.—Review of any local coverage determination shall be subject to the following limitations:

‘‘(i) Upon the filing of a complaint by an aggrieved

party, such a determination shall be reviewed by an

administrative law judge of the Social Security

Administration. The administrative law judge—

‘‘(I) shall review the record and shall permit

discovery and the taking of evidence to evaluate

the reasonableness of the determination, if the

administrative law judge determines that the

record is incomplete or lacks adequate information

to support the validity of the determination;

‘‘(II) may, as appropriate, consult with appropriate scientific and clinical experts; and

‘‘(III) shall defer only to the reasonable findings of fact, reasonable interpretations of law, and

reasonable applications of fact to law by the Secretary.

‘‘(ii) Upon the filing of a complaint by an aggrieved

party, a decision of an administrative law judge under

clause (i) shall be reviewed by the Departmental

Appeals Board of the Department of Health and

Human Services.

‘‘(iii) The Secretary shall implement a decision of

the administrative law judge or the Departmental

Appeals Board within 30 days of receipt of such decision.

‘‘(iv) A decision of the Departmental Appeals Board

constitutes a final agency action and is subject to

judicial review.

‘‘(B) DEFINITION OF LOCAL COVERAGE DETERMINATION.—For purposes of this section, the term ‘local coverage

determination’ means a determination by a fiscal intermediary or a carrier under part A or part B, as applicable,

respecting whether or not a particular item or service is

covered on an intermediary- or carrier-wide basis under

such parts, in accordance with section 1862(a)(1)(A).

‘‘(3) NO MATERIAL ISSUES OF FACT IN DISPUTE.—In the case

of a determination that may otherwise be subject to review

under paragraph (1)(A)(iii) or paragraph (2)(A)(i), where the

moving party alleges that—

‘‘(A) there are no material issues of fact in dispute,

and

‘‘(B) the only issue of law is the constitutionality of

a provision of this title, or that a regulation, determination,

or ruling by the Secretary is invalid,

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–545

the moving party may seek review by a court of competent

jurisdiction without filing a complaint under such paragraph

and without otherwise exhausting other administrative remedies.

‘‘(4) PENDING NATIONAL COVERAGE DETERMINATIONS.—

‘‘(A) IN GENERAL.—In the event the Secretary has not

issued a national coverage or noncoverage determination

with respect to a particular type or class of items or services, an aggrieved person (as described in paragraph (5))

may submit to the Secretary a request to make such a

determination with respect to such items or services. By

not later than the end of the 90-day period beginning

on the date the Secretary receives such a request (notwithstanding the receipt by the Secretary of new evidence (if

any) during such 90-day period), the Secretary shall take

one of the following actions:

‘‘(i) Issue a national coverage determination, with

or without limitations.

‘‘(ii) Issue a national noncoverage determination.

‘‘(iii) Issue a determination that no national coverage or noncoverage determination is appropriate as

of the end of such 90-day period with respect to

national coverage of such items or services.

‘‘(iv) Issue a notice that states that the Secretary

has not completed a review of the request for a national

coverage determination and that includes an identification of the remaining steps in the Secretary’s review

process and a deadline by which the Secretary will

complete the review and take an action described in

subclause (I), (II), or (III).

‘‘(B) DEEMED ACTION BY THE SECRETARY.—In the case

of an action described in clause (i)(IV), if the Secretary

fails to take an action referred to in such clause by the

deadline specified by the Secretary under such clause, then

the Secretary is deemed to have taken an action described

in clause (i)(III) as of the deadline.

‘‘(C) EXPLANATION OF DETERMINATION.—When issuing

a determination under clause (i), the Secretary shall include

an explanation of the basis for the determination. An action

taken under clause (i) (other than subclause (IV)) is deemed

to be a national coverage determination for purposes of

review under subparagraph (A).

‘‘(5) STANDING.—An action under this subsection seeking

review of a national coverage determination or local coverage

determination may be initiated only by individuals entitled

to benefits under part A, or enrolled under part B, or both,

who are in need of the items or services that are the subject

of the coverage determination.

‘‘(6) PUBLICATION ON THE INTERNET OF DECISIONS OF HEARINGS OF THE SECRETARY.—Each decision of a hearing by the

Secretary with respect to a national coverage determination

shall be made public, and the Secretary shall publish each

decision on the Medicare Internet site of the Department of

Health and Human Services. The Secretary shall remove from

such decision any information that would identify any individual, provider of services, or supplier.

114 STAT. 2763A–546 PUBLIC LAW 106–554—APPENDIX F

‘‘(7) ANNUAL REPORT ON NATIONAL COVERAGE DETERMINATIONS.—

‘‘(A) IN GENERAL.—Not later than December 1 of each

year, beginning in 2001, the Secretary shall submit to

Congress a report that sets forth a detailed compilation

of the actual time periods that were necessary to complete

and fully implement national coverage determinations that

were made in the previous fiscal year for items, services,

or medical devices not previously covered as a benefit under

this title, including, with respect to each new item, service,

or medical device, a statement of the time taken by the

Secretary to make and implement the necessary coverage,

coding, and payment determinations, including the time

taken to complete each significant step in the process of

making and implementing such determinations.

‘‘(B) PUBLICATION OF REPORTS ON THE INTERNET.—The

Secretary shall publish each report submitted under clause

(i) on the medicare Internet site of the Department of

Health and Human Services.

‘‘(8) CONSTRUCTION.—Nothing in this subsection shall be

construed as permitting administrative or judicial review pursuant to this section insofar as such review is explicitly prohibited

or restricted under another provision of law.’’.

(b) ESTABLISHMENT OF A PROCESS FOR COVERAGE DETERMINATIONS.—Section 1862(a) (42 U.S.C. 1395y(a)) is amended by adding

at the end the following new sentence: ‘‘In making a national

coverage determination (as defined in paragraph (1)(B) of section

1869(f )) the Secretary shall ensure that the public is afforded

notice and opportunity to comment prior to implementation by

the Secretary of the determination; meetings of advisory committees

established under section 1114(f ) with respect to the determination

are made on the record; in making the determination, the Secretary

has considered applicable information (including clinical experience

and medical, technical, and scientific evidence) with respect to

the subject matter of the determination; and in the determination,

provide a clear statement of the basis for the determination (including responses to comments received from the public), the assumptions underlying that basis, and make available to the public the

data (other than proprietary data) considered in making the determination.’’.

(c) IMPROVEMENTS TO THE MEDICARE ADVISORY COMMITTEE

PROCESS.—Section 1114 (42 U.S.C. 1314) is amended by adding

at the end the following new subsection:

‘‘(i)(1) Any advisory committee appointed under subsection (f )

to advise the Secretary on matters relating to the interpretation,

application, or implementation of section 1862(a)(1) shall assure

the full participation of a nonvoting member in the deliberations

of the advisory committee, and shall provide such nonvoting member

access to all information and data made available to voting members

of the advisory committee, other than information that—

‘‘(A) is exempt from disclosure pursuant to subsection (a)

of section 552 of title 5, United States Code, by reason of

subsection (b)(4) of such section (relating to trade secrets);

or

‘‘(B) the Secretary determines would present a conflict of

interest relating to such nonvoting member.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–547

‘‘(2) If an advisory committee described in paragraph (1)

organizes into panels of experts according to types of items or

services considered by the advisory committee, any such panel

of experts may report any recommendation with respect to such

items or services directly to the Secretary without the prior approval

of the advisory committee or an executive committee thereof.’’. (d) EFFECTIVE DATE.—The amendments made by this section

shall apply with respect to— (1) a review of any national or local coverage determination

filed,

(2) a request to make such a determination made, and

(3) a national coverage determination made,

on or after October 1, 2001.

Subtitle D—Improving Access to New

Technologies

SEC. 531. REIMBURSEMENT IMPROVEMENTS FOR NEW CLINICAL LABORATORY TESTS AND DURABLE MEDICAL EQUIPMENT.

(a) PAYMENT RULE FOR NEW LABORATORY TESTS.—Section

1833(h)(4)(B)(viii) (42 U.S.C. 1395l(h)(4)(B)(viii)) is amended by

inserting before the period at the end the following: ‘‘(or 100 percent

of such median in the case of a clinical diagnostic laboratory test

performed on or after January 1, 2001, that the Secretary determines is a new test for which no limitation amount has previously

been established under this subparagraph)’’.

(b) ESTABLISHMENT OF CODING AND PAYMENT PROCEDURES FOR

NEW CLINICAL DIAGNOSTIC LABORATORY TESTS AND OTHER ITEMS

ON A FEE SCHEDULE.—Not later than 1 year after the date of

the enactment of this Act, the Secretary of Health and Human

Services shall establish procedures for coding and payment determinations for the categories of new clinical diagnostic laboratory

tests and new durable medical equipment under part B of title

XVIII of the Social Security Act that permit public consultation

in a manner consistent with the procedures established for

implementing coding modifications for ICD–9–CM.

(c) REPORT ON PROCEDURES USED FOR ADVANCED, IMPROVED

TECHNOLOGIES.—Not later than 1 year after the date of the enactment of this Act, the Secretary of Health and Human Services

shall submit to Congress a report that identifies the specific procedures used by the Secretary under part B of title XVIII of the

Social Security Act to adjust payments for clinical diagnostic laboratory tests and durable medical equipment which are classified to

existing codes where, because of an advance in technology with

respect to the test or equipment, there has been a significant

increase or decrease in the resources used in the test or in the

manufacture of the equipment, and there has been a significant

improvement in the performance of the test or equipment. The

report shall include such recommendations for changes in law as

may be necessary to assure fair and appropriate payment levels

under such part for such improved tests and equipment as reflects

increased costs necessary to produce improved results.

SEC. 532. RETENTION OF HCPCS LEVEL III CODES.

(a) IN GENERAL.—The Secretary of Health and Human Services

shall maintain and continue the use of level III codes of the HCPCS

114 STAT. 2763A–548 PUBLIC LAW 106–554—APPENDIX F

coding system (as such system was in effect on August 16, 2000)

through December 31, 2003, and shall make such codes available

to the public.

(b) DEFINITION.—For purposes of this section, the term ‘‘HCPCS

Level III codes’’ means the alphanumeric codes for local use under

the Health Care Financing Administration Common Procedure Coding System (HCPCS).

SEC. 533. RECOGNITION OF NEW MEDICAL TECHNOLOGIES UNDER

INPATIENT HOSPITAL PPS.

(a) EXPEDITING RECOGNITION OF NEW TECHNOLOGIES INTO

INPATIENT PPS CODING SYSTEM.—

(1) REPORT.—Not later than April 1, 2001, the Secretary

of Health and Human Services shall submit to Congress a

report on methods of expeditiously incorporating new medical

services and technologies into the clinical coding system used

with respect to payment for inpatient hospital services furnished under the medicare program under title XVIII of the

Social Security Act, together with a detailed description of

the Secretary’s preferred methods to achieve this purpose.

(2) IMPLEMENTATION.—Not later than October 1, 2001, the

Secretary shall implement the preferred methods described in

the report transmitted pursuant to paragraph (1).

(b) ENSURING APPROPRIATE PAYMENTS FOR HOSPITALS INCORPORATING NEW MEDICAL SERVICES AND TECHNOLOGIES.—

(1) ESTABLISHMENT OF MECHANISM.—Section 1886(d)(5) (42

U.S.C. 1395ww(d)(5)) is amended by adding at the end the

following new subparagraphs:

‘‘(K)(i) Effective for discharges beginning on or after October

1, 2001, the Secretary shall establish a mechanism to recognize

the costs of new medical services and technologies under the payment system established under this subsection. Such mechanism

shall be established after notice and opportunity for public comment

(in the publications required by subsection (e)(5) for a fiscal year

or otherwise).

‘‘(ii) The mechanism established pursuant to clause (i) shall—

‘‘(I) apply to a new medical service or technology if, based

on the estimated costs incurred with respect to discharges

involving such service or technology, the DRG prospective payment rate otherwise applicable to such discharges under this

subsection is inadequate;

‘‘(II) provide for the collection of data with respect to the

costs of a new medical service or technology described in subclause (I) for a period of not less than two years and not

more than three years beginning on the date on which an

inpatient hospital code is issued with respect to the service

or technology;

‘‘(III) subject to paragraph (4)(C)(iii), provide for additional

payment to be made under this subsection with respect to

discharges involving a new medical service or technology

described in subclause (I) that occur during the period described

in subclause (II) in an amount that adequately reflects the

estimated average cost of such service or technology; and

‘‘(IV) provide that discharges involving such a service or

technology that occur after the close of the period described

in subclause (II) will be classified within a new or existing

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–549

diagnosis-related group with a weighting factor under paragraph (4)(B) that is derived from cost data collected with respect

to discharges occurring during such period.

‘‘(iii) For purposes of clause (ii)(II), the term ‘inpatient hospital

code’ means any code that is used with respect to inpatient hospital

services for which payment may be made under this subsection

and includes an alphanumeric code issued under the International

Classification of Diseases, 9th Revision, Clinical Modification (‘ICD–

9–CM’) and its subsequent revisions.

‘‘(iv) For purposes of clause (ii)(III), the term ‘additional payment’ means, with respect to a discharge for a new medical service

or technology described in clause (ii)(I), an amount that exceeds

the prospective payment rate otherwise applicable under this subsection to discharges involving such service or technology that would

be made but for this subparagraph.

‘‘(v) The requirement under clause (ii)(III) for an additional

payment may be satisfied by means of a new-technology group

(described in subparagraph (L)), an add-on payment, a payment

adjustment, or any other similar mechanism for increasing the

amount otherwise payable with respect to a discharge under this

subsection. The Secretary may not establish a separate fee schedule

for such additional payment for such services and technologies,

by utilizing a methodology established under subsection (a) or (h)

of section 1834 to determine the amount of such additional payment,

or by other similar mechanisms or methodologies.

‘‘(vi) For purposes of this subparagraph and subparagraph (L),

a medical service or technology will be considered a ‘new medical

service or technology’ if the service or technology meets criteria

established by the Secretary after notice and an opportunity for

public comment.

‘‘(L)(i) In establishing the mechanism under subparagraph (K),

the Secretary may establish new-technology groups into which a

new medical service or technology will be classified if, based on

the estimated average costs incurred with respect to discharges

involving such service or technology, the DRG prospective payment

rate otherwise applicable to such discharges under this subsection

is inadequate.

‘‘(ii) Such groups—

‘‘(I) shall not be based on the costs associated with a

specific new medical service or technology; but

‘‘(II) shall, in combination with the applicable standardized

amounts and the weighting factors assigned to such groups

under paragraph (4)(B), reflect such cost cohorts as the Secretary determines are appropriate for all new medical services

and technologies that are likely to be provided as inpatient

hospital services in a fiscal year.

‘‘(iii) The methodology for classifying specific hospital discharges

within a diagnosis-related group under paragraph (4)(A) or a newtechnology group shall provide that a specific hospital discharge

may not be classified within both a diagnosis-related group and

a new-technology group.’’.

(2) PRIOR CONSULTATION.—The Secretary of Health and

Human Services shall consult with groups representing hospitals, physicians, and manufacturers of new medical technologies before publishing the notice of proposed rulemaking

required by section 1886(d)(5)(K)(i) of the Social Security Act

(as added by paragraph (1)).

114 STAT. 2763A–550 PUBLIC LAW 106–554—APPENDIX F

(3) CONFORMING AMENDMENT.—Section 1886(d)(4)(C)(i) (42

U.S.C. 1395ww(d)(4)(C)(i)) is amended by striking ‘‘technology,’’

and inserting ‘‘technology (including a new medical service

or technology under paragraph (5)(K)),’’.

Subtitle E—Other Provisions

SEC. 541. INCREASE IN REIMBURSEMENT FOR BAD DEBT.

Section 1861(v)(1)(T) (42 U.S.C. 1395x(v)(1)(T)) is amended—

(1) in clause (ii), by striking ‘‘and’’ at the end;

(2) in clause (iii)—

(A) by striking ‘‘during a subsequent fiscal year’’ and

inserting ‘‘during fiscal year 2000’’; and

(B) by striking the period at the end and inserting

‘‘, and’’; and

(3) by adding at the end the following new clause:

‘‘(iv) for cost reporting periods beginning during a subsequent fiscal year, by 30 percent of such amount otherwise

allowable.’’.

SEC. 542. TREATMENT OF CERTAIN PHYSICIAN PATHOLOGY SERVICES

UNDER MEDICARE.

(a) IN GENERAL.—When an independent laboratory furnishes

the technical component of a physician pathology service to a feefor-service medicare beneficiary who is an inpatient or outpatient

of a covered hospital, the Secretary of Health and Human Services

shall treat such component as a service for which payment shall

be made to the laboratory under section 1848 of the Social Security

Act (42 U.S.C. 1395w–4) and not as an inpatient hospital service

for which payment is made to the hospital under section 1886(d)

of such Act (42 U.S.C. 1395ww(d)) or as an outpatient hospital

service for which payment is made to the hospital under section

1833(t) of such Act (42 U.S.C. 1395l(t)).

(b) DEFINITIONS.—For purposes of this section:

(1) COVERED HOSPITAL.—The term ‘‘covered hospital’’

means, with respect to an inpatient or an outpatient, a hospital

that had an arrangement with an independent laboratory that

was in effect as of July 22, 1999, under which a laboratory

furnished the technical component of physician pathology services to fee-for-service medicare beneficiaries who were hospital

inpatients or outpatients, respectively, and submitted claims

for payment for such component to a medicare carrier (that

has a contract with the Secretary under section 1842 of the

Social Security Act, 42 U.S.C. 1395u) and not to such hospital.

(2) FEE-FOR-SERVICE MEDICARE BENEFICIARY.—The term

‘‘fee-for-service medicare beneficiary’’ means an individual

who—

(A) is entitled to benefits under part A, or enrolled

under part B, or both, of such title; and

(B) is not enrolled in any of the following:

(i) A Medicare+Choice plan under part C of such

title.

(ii) A plan offered by an eligible organization under

section 1876 of such Act (42 U.S.C. 1395mm).

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–551

(iii) A program of all-inclusive care for the elderly

(PACE) under section 1894 of such Act (42 U.S.C.

1395eee).

(iv) A social health maintenance organization

(SHMO) demonstration project established under section 4018(b) of the Omnibus Budget Reconciliation Act

of 1987 (Public Law 100–203).

(c) EFFECTIVE DATE.—This section shall apply to services furnished during the 2-year period beginning on January 1, 2001.

(d) GAO REPORT.— (1) STUDY.—The Comptroller General of the United States

shall conduct a study of the effects of the previous provisions

of this section on hospitals and laboratories and access of feefor-service medicare beneficiaries to the technical component

of physician pathology services.

(2) REPORT.—Not later than April 1, 2002, the Comptroller

General shall submit to Congress a report on such study. The

report shall include recommendations about whether such

provisions should be extended after the end of the period specified in subsection (c) for either or both inpatient and outpatient

hospital services, and whether the provisions should be

extended to other hospitals.

SEC. 543. EXTENSION OF ADVISORY OPINION AUTHORITY.

Section 1128D(b)(6) (42 U.S.C. 1320a–7d(b)(6)) is amended by

striking ‘‘and before the date which is 4 years after such date

of enactment’’.

SEC. 544. CHANGE IN ANNUAL MEDPAC REPORTING.

(a) REVISION OF DEADLINES FOR SUBMISSION OF REPORTS.—

(1) IN GENERAL.—Section 1805(b)(1)(D) (42 U.S.C. 1395b–

6(b)(1)(D)) is amended by striking ‘‘June 1 of each year (beginning with 1998),’’ and inserting ‘‘June 15 of each year,’’.

(2) EFFECTIVE DATE.—The amendment made by paragraph

(1) shall apply beginning with 2001.

(b) REQUIREMENT FOR ON THE RECORD VOTES ON RECOMMENDATIONS.—Section 1805(b) (42 U.S.C. 1395b–6(b)) is amended by adding at the end the following new paragraph:

‘‘(7) VOTING AND REPORTING REQUIREMENTS.—With respect

to each recommendation contained in a report submitted under

paragraph (1), each member of the Commission shall vote on

the recommendation, and the Commission shall include, by

member, the results of that vote in the report containing the

recommendation.’’.

SEC. 545. DEVELOPMENT OF PATIENT ASSESSMENT INSTRUMENTS.

(a) DEVELOPMENT.—

(1) IN GENERAL.—Not later than January 1, 2005, the Secretary of Health and Human Services shall submit to the

Committee on Ways and Means and the Committee on Commerce of the House of Representatives and the Committee

on Finance of the Senate a report on the development of standard instruments for the assessment of the health and functional

status of patients, for whom items and services described in

subsection (b) are furnished, and include in the report a recommendation on the use of such standard instruments for

payment purposes.

114 STAT. 2763A–552 PUBLIC LAW 106–554—APPENDIX F

(2) DESIGN FOR COMPARISON OF COMMON ELEMENTS.—The

Secretary shall design such standard instruments in a manner

such that—

(A) elements that are common to the items and services

described in subsection (b) may be readily comparable and

are statistically compatible;

(B) only elements necessary to meet program objectives

are collected; and

(C) the standard instruments supersede any other

assessment instrument used before that date.

(3) CONSULTATION.—In developing an assessment

instrument under paragraph (1), the Secretary shall consult

with the Medicare Payment Advisory Commission, the Agency

for Healthcare Research and Quality, and qualified organizations representing providers of services and suppliers under

title XVIII.

(b) DESCRIPTION OF SERVICES.—For purposes of subsection (a),

items and services described in this subsection are those items

and services furnished to individuals entitled to benefits under

part A, or enrolled under part B, or both of title XVIII of the

Social Security Act for which payment is made under such title,

and include the following:

(1) Inpatient and outpatient hospital services.

(2) Inpatient and outpatient rehabilitation services.

(3) Covered skilled nursing facility services.

(4) Home health services.

(5) Physical or occupational therapy or speech-language

pathology services.

(6) Items and services furnished to such individuals determined to have end stage renal disease.

(7) Partial hospitalization services and other mental health

services.

(8) Any other service for which payment is made under

such title as the Secretary determines to be appropriate.

SEC. 546. GAO REPORT ON IMPACT OF THE EMERGENCY MEDICAL

TREATMENT AND ACTIVE LABOR ACT (EMTALA) ON HOSPITAL EMERGENCY DEPARTMENTS.

(a) REPORT.—The Comptroller General of the United States

shall submit a report to the Committee on Commerce and the

Committee on Ways and Means of the House of Representatives

and the Committee on Finance of the Senate by May 1, 2001,

on the effect of the Emergency Medical Treatment and Active

Labor Act on hospitals, emergency physicians, and physicians covering emergency department call throughout the United States.

(b) REPORT REQUIREMENTS.—The report should evaluate—

(1) the extent to which hospitals, emergency physicians,

and physicians covering emergency department call provide

uncompensated services in relation to the requirements of

EMTALA;

(2) the extent to which the regulatory requirements and

enforcement of EMTALA have expanded beyond the legislation’s original intent;

(3) estimates for the total dollar amount of EMTALArelated care uncompensated costs to emergency physicians,

physicians covering emergency department call, hospital emergency departments, and other hospital services;

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–553

(4) the extent to which different portions of the United

States may be experiencing different levels of uncompensated

EMTALA-related care;

(5) the extent to which EMTALA would be classified as

an unfunded mandate if it were enacted today;

(6) the extent to which States have programs to provide

financial support for such uncompensated care;

(7) possible sources of funds, including medicare hospital

bad debt accounts, that are available to hospitals to assist

with the cost of such uncompensated care; and

(8) the financial strain that illegal immigration populations,

the uninsured, and the underinsured place on hospital emergency departments, other hospital services, emergency physicians, and physicians covering emergency department call.

(c) DEFINITION.—In this section, the terms ‘‘Emergency Medical

Treatment and Active Labor Act’’ and ‘‘EMTALA’’ mean section

1867 of the Social Security Act (42 U.S.C. 1395dd).

SEC. 547. CLARIFICATION OF APPLICATION OF TEMPORARY PAYMENT

INCREASES FOR 2001.

(a) INPATIENT HOSPITAL SERVICES.—The payment increase provided under the following sections shall not apply to discharges

occurring after fiscal year 2001 and shall not be taken into account

in calculating the payment amounts applicable for discharges occurring after such fiscal year:

(1) Section 301(b)(2)(A) (relating to acute care hospital payment update).

(2) Section 302(b) (relating to IME percentage adjustment).

(3) Section 303(b)(2) (relating to DSH payments).

(b) SKILLED NURSING FACILITY SERVICES.—The payment

increase provided under section 311(b)(2) (relating to covered skilled

nursing facility services) shall not apply to services furnished after

fiscal year 2001 and shall not be taken into account in calculating

the payment amounts applicable for services furnished after such

fiscal year.

(c) HOME HEALTH SERVICES.—

(1) TRANSITIONAL ALLOWANCE FOR FULL MARKETBASKET

INCREASE.—The payment increase provided under section

502(b)(1)(B) shall not apply to episodes and visits ending after

fiscal year 2001 and shall not be taken into account in calculating the payment amounts applicable for subsequent episodes

and visits.

(2) TEMPORARY INCREASE FOR RURAL HOME HEALTH SERVICES.—The payment increase provided under section 508(a) for

the period beginning on April 1, 2001, and ending on September

30, 2002, shall not apply to episodes and visits ending after

such period, and shall not be taken into account in calculating

the payment amounts applicable for episodes and visits occurring after such period.

(d) CALENDAR YEAR 2001 PROVISIONS.—The payment increase

provided under the following sections shall not apply after calendar

year 2001 and shall not be taken into account in calculating the

payment amounts applicable for items and services furnished after

such year:

(1) Section 401(c)(2) (relating to covered OPD services).

(2) Section 422(e)(2) (relating to renal dialysis services

paid for on a composite rate basis).

114 STAT. 2763A–554 PUBLIC LAW 106–554—APPENDIX F

(3) Section 423(a)(2)(B) (relating to ambulance services).

(4) Section 425(b)(2) (relating to durable medical equipment).

(5) Section 426(b)(2) (relating to prosthetic devices and

orthotics and prosthetics).

TITLE VI—PROVISIONS RELATING TO

PART C (MEDICARE+CHOICE PROGRAM) AND OTHER MEDICARE MANAGED CARE PROVISIONS

Subtitle A—Medicare+Choice Payment

Reforms

SEC. 601. INCREASE IN MINIMUM PAYMENT AMOUNT.

(a) IN GENERAL.—Section 1853(c)(1)(B) (42 U.S.C. 1395w– 23(c)(1)(B)) is amended— (1) by redesignating clause (ii) as clause (iv);

(2) by inserting after clause (i) the following new clauses: ‘‘(ii) For 1999 and 2000, the minimum amount

determined under clause (i) or this clause, respectively,

for the preceding year, increased by the national per

capita Medicare+Choice growth percentage described

in paragraph (6)(A) applicable to 1999 or 2000, respectively. ‘‘(iii)(I) Subject to subclause (II), for 2001, for any

area in a Metropolitan Statistical Area with a population of more than 250,000, $525, and for any other

area $475. ‘‘(II) In the case of an area outside the 50 States

and the District of Columbia, the amount specified

in this clause shall not exceed 120 percent of the

amount determined under clause (ii) for such area

for 2000.’’; and

(3) in clause (iv), as so redesignated— (A) by striking ‘‘a succeeding year’’ and inserting ‘‘2002

and each succeeding year’’; and

(B) by striking ‘‘clause (i)’’ and inserting ‘‘clause (iii)’’. (b) SPECIAL RULE FOR JANUARY AND FEBRUARY OF 2001.—

(1) IN GENERAL.—Notwithstanding the amendments made

by subsection (a), for purposes of making payments under section 1853 of the Social Security Act (42 U.S.C. 1395w–23)

for January and February 2001, the annual Medicare+Choice

capitation rate for a Medicare+Choice payment area shall be

calculated, and the excess amount under section 1854(f )(1)(B)

of such Act (42 U.S.C. 1395w–24(f )(1)(B)) shall be determined,

as if such amendments had not been enacted.

(2) CONSTRUCTION.—Paragraph (1) shall not be taken into

account in computing such capitation rate for 2002 and subsequent years.

SEC. 602. INCREASE IN MINIMUM PERCENTAGE INCREASE.

(a) IN GENERAL.—Section 1853(c)(1)(C) (42 U.S.C. 1395w–

23(c)(1)(C)) is amended—

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–555

(1) by redesignating clause (ii) as clause (iv);

(2) by inserting after clause (i) the following new clauses: ‘‘(ii) For 1999 and 2000, 102 percent of the annual

Medicare+Choice capitation rate under this paragraph

for the area for the previous year. ‘‘(iii) For 2001, 103 percent of the annual

Medicare+Choice capitation rate under this paragraph

for the area for 2000.’’; and

(3) in clause (iv), as so redesignated, by striking ‘‘a subsequent year’’ and inserting ‘‘2002 and each succeeding year’’. (b) APPLICATION OF SPECIAL RULE FOR JANUARY AND FEBRUARY

OF 2001.—The provisions of section 601(b) shall apply with respect

to the amendments made by subsection (a) in the same manner

as they apply to the amendments made by section 601(a).

SEC. 603. PHASE-IN OF RISK ADJUSTMENT.

Section 1853(a)(3)(C) (42 U.S.C. 1395w–23(a)(3)(C)) is

amended—

(1) in clause (ii)— (A) in subclause (I), by striking ‘‘and 2001’’ and inserting ‘‘and each succeeding year through 2003’’ and by striking ‘‘and’’ at the end; and

(B) by striking subclause (II) and inserting the following new subclauses: ‘‘(II) 30 percent of such capitation rate in 2004;

‘‘(III) 50 percent of such capitation rate in

2005;‘‘(IV) 75 percent of such capitation rate in

2006; and ‘‘(V) 100 percent of such capitation rate in

2007 and succeeding years.’’; and

(2) by adding at the end the following new clause: ‘‘(iii) DATA FOR RISK ADJUSTMENT METHODOLOGY.— Such risk adjustment methodology for 2004 and each

succeeding year, shall be based on data from inpatient

hospital and ambulatory settings.’’.

SEC. 604. TRANSITION TO REVISED MEDICARE+CHOICE PAYMENT

RATES.

(a) ANNOUNCEMENT OF REVISED MEDICARE+CHOICE PAYMENT

RATES.—Within 2 weeks after the date of the enactment of this

Act, the Secretary of Health and Human Services shall determine,

and shall announce (in a manner intended to provide notice to

interested parties) Medicare+Choice capitation rates under section

1853 of the Social Security Act (42 U.S.C. 1395w–23) for 2001,

revised in accordance with the provisions of this Act.

(b) REENTRY INTO PROGRAM PERMITTED FOR MEDICARE+CHOICE

PROGRAMS.—A Medicare+Choice organization that provided notice

to the Secretary of Health and Human Services before the date

of the enactment of this Act that it was terminating its contract

under part C of title XVIII of the Social Security Act or was

reducing the service area of a Medicare+Choice plan offered under

such part shall be permitted to continue participation under such

part, or to maintain the service area of such plan, for 2001 if

it submits the Secretary with the information described in section

1854(a)(1) of the Social Security Act (42 U.S.C. 1395w–24(a)(1))

within 2 weeks after the date revised rates are announced by

the Secretary under subsection (a).

114 STAT. 2763A–556 PUBLIC LAW 106–554—APPENDIX F

(c) REVISED SUBMISSION OF PROPOSED PREMIUMS AND RELATED

INFORMATION.—If— (1) a Medicare+Choice organization provided notice to the

Secretary of Health and Human Services as of July 3, 2000,

that it was renewing its contract under part C of title XVIII

of the Social Security Act for all or part of the service area

or areas served under its current contract, and

(2) any part of the service area or areas addressed in

such notice includes a payment area for which the

Medicare+Choice capitation rate under section 1853(c) of such

Act (42 U.S.C. 1395w–23(c)) for 2001, as determined under

subsection (a), is higher than the rate previously determined

for such year,

such organization shall revise its submission of the information

described in section 1854(a)(1) of the Social Security Act (42 U.S.C.

1395w–24(a)(1)), and shall submit such revised information to the

Secretary, within 2 weeks after the date revised rates are

announced by the Secretary under subsection (a). In making such

submission, the organization may only reduce beneficiary premiums,

reduce beneficiary cost-sharing, enhance benefits, utilize the stabilization fund described in section 1854(f )(2) of such Act (42 U.S.C.

1395w–24(f )(2)), or stabilize or enhance beneficiary access to providers (so long as such stabilization or enhancement does not result

in increased beneficiary premiums, increased beneficiary cost-sharing, or reduced benefits).

(d) WAIVER OF LIMITS ON STABILIZATION FUND.—Any regulatory

provision that limits the proportion of the excess amount that

can be withheld in such stabilization fund for a contract period

shall not apply with respect to submissions described in subsections

(b) and (c).

(e) DISREGARD OF NEW RATE ANNOUNCEMENT IN APPLYING

PASS-THROUGH FOR NEW NATIONAL COVERAGE DETERMINATIONS.—

For purposes of applying section 1852(a)(5) of the Social Security

Act (42 U.S.C. 1395w–22(a)(5)), the announcement of revised rates

under subsection (a) shall not be treated as an announcement

under section 1853(b) of such Act (42 U.S.C. 1395w–23(b)).

SEC. 605. REVISION OF PAYMENT RATES FOR ESRD PATIENTS

ENROLLED IN MEDICARE+CHOICE PLANS.

(a) IN GENERAL.—Section 1853(a)(1)(B) (42 U.S.C. 1395w–

23(a)(1)(B)) is amended by adding at the end the following: ‘‘In

establishing such rates, the Secretary shall provide for appropriate

adjustments to increase each rate to reflect the demonstration rate

(including the risk adjustment methodology associated with such

rate) of the social health maintenance organization end-stage renal

disease capitation demonstrations (established by section 2355 of

the Deficit Reduction Act of 1984, as amended by section 13567(b)

of the Omnibus Budget Reconciliation Act of 1993), and shall compute such rates by taking into account such factors as renal treatment modality, age, and the underlying cause of the end-stage

renal disease.’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to payments for months beginning with January 2002.

(c) PUBLICATION.—Not later than 6 months after the date of

the enactment of this Act, the Secretary of Health and Human

Services shall publish for public comment a description of the

appropriate adjustments described in the last sentence of section

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–557

1853(a)(1)(B) of the Social Security Act (42 U.S.C. 1395w–

23(a)(1)(B)), as added by subsection (a). The Secretary shall publish

such adjustments in final form by not later than July 1, 2001,

so that the amendment made by subsection (a) is implemented

on a timely basis consistent with subsection (b).

SEC. 606. PERMITTING PREMIUM REDUCTIONS AS ADDITIONAL BENEFITS UNDER MEDICARE+CHOICE PLANS.

(a) IN GENERAL.—

(1) AUTHORIZATION OF PART B PREMIUM REDUCTIONS.—Section 1854(f )(1) (42 U.S.C. 1395w–24(f )(1)) is amended—

(A) by redesignating subparagraph (E) as subparagraph (F); and

(B) by inserting after subparagraph (D) the following

new subparagraph:

‘‘(E) PREMIUM REDUCTIONS.—

‘‘(i) IN GENERAL.—Subject to clause (ii), as part

of providing any additional benefits required under

subparagraph (A), a Medicare+Choice organization

may elect a reduction in its payments under section

1853(a)(1)(A) with respect to a Medicare+Choice plan

and the Secretary shall apply such reduction to reduce

the premium under section 1839 of each enrollee in

such plan as provided in section 1840(i).

‘‘(ii) AMOUNT OF REDUCTION.—The amount of the

reduction under clause (i) with respect to any enrollee

in a Medicare+Choice plan—

‘‘(I) may not exceed 125 percent of the premium described under section 1839(a)(3); and

‘‘(II) shall apply uniformly to each enrollee

of the Medicare+Choice plan to which such reduction applies.’’.

(2) CONFORMING AMENDMENTS.—

(A) ADJUSTMENT OF PAYMENTS TO MEDICARE+CHOICE

ORGANIZATIONS.—Section 1853(a)(1)(A) (42 U.S.C. 1395w–

23(a)(1)(A)) is amended by inserting ‘‘reduced by the

amount of any reduction elected under section 1854(f )(1)(E)

and’’ after ‘‘for that area,’’.

(B) ADJUSTMENT AND PAYMENT OF PART B PREMIUMS.—

(i) ADJUSTMENT OF PREMIUMS.—Section 1839(a)(2)

(42 U.S.C. 1395r(a)(2)) is amended by striking ‘‘shall’’

and all that follows and inserting the following: ‘‘shall

be the amount determined under paragraph (3),

adjusted as required in accordance with subsections

(b), (c), and (f ), and to reflect 80 percent of any reduction elected under section 1854(f )(1)(E).’’.

(ii) PAYMENT OF PREMIUMS.—Section 1840 (42

U.S.C. 1395s) is amended by adding at the end the

following new subsection:

‘‘(i) In the case of an individual enrolled in a Medicare+Choice

plan, the Secretary shall provide for necessary adjustments of the

monthly beneficiary premium to reflect 80 percent of any reduction

elected under section 1854(f )(1)(E). To the extent to which the

Secretary determines that such an adjustment is appropriate, with

the concurrence of any agency responsible for the administration

of such benefits, such premium adjustment may be provided

114 STAT. 2763A–558 PUBLIC LAW 106–554—APPENDIX F

directly, as an adjustment to any social security, railroad retirement, or civil service retirement benefits, or, in the case of an

individual who receives medical assistance under title XIX for medicare costs described in section 1905(p)(3)(A)(ii), as an adjustment

to the amount otherwise owed by the State for such medical assistance.’’.

(C) INFORMATION COMPARING PLAN PREMIUMS UNDER

PART C.—Section 1851(d)(4)(B) (42 U.S.C. 1395w–

21(d)(4)(B)) is amended—

(i) by striking ‘‘PREMIUMS.—The’’ and inserting

‘‘PREMIUMS.—

‘‘(i) IN GENERAL.—The’’; and

(ii) by adding at the end the following new clause:

‘‘(ii) REDUCTIONS.—The reduction in part B premiums, if any.’’.

(D) TREATMENT OF REDUCTION FOR PURPOSES OF DETERMINING GOVERNMENT CONTRIBUTION UNDER PART B.—Section 1844 (42 U.S.C. 1395w) is amended by adding at

the end the following new subsection:

‘‘(c) The Secretary shall determine the Government contribution

under subparagraphs (A) and (B) of subsection (a)(1) without regard

to any premium reduction resulting from an election under section

1854(f )(1)(E).’’.

(b) EFFECTIVE DATE.—The amendments made by subsection

(a) shall apply to years beginning with 2003.

SEC. 607. FULL IMPLEMENTATION OF RISK ADJUSTMENT FOR CONGESTIVE HEART FAILURE ENROLLEES FOR 2001.

(a) IN GENERAL.—Section 1853(a)(3)(C) (42 U.S.C. 1395w–

23(a)(3)(C)) is amended—

(1) in clause (ii), by striking ‘‘Such risk adjustment’’ and

inserting ‘‘Except as provided in clause (iii), such risk adjustment’’; and

(2) by adding at the end the following new clause:

‘‘(iii) FULL IMPLEMENTATION OF RISK ADJUSTMENT

FOR CONGESTIVE HEART FAILURE ENROLLEES FOR 2001.—

‘‘(I) EXEMPTION FROM PHASE-IN.—Subject to

subclause (II), the Secretary shall fully implement

the risk adjustment methodology described in

clause (i) with respect to each individual who has

had a qualifying congestive heart failure inpatient

diagnosis (as determined by the Secretary under

such risk adjustment methodology) during the

period beginning on July 1, 1999, and ending on

June 30, 2000, and who is enrolled in a coordinated

care plan that is the only coordinated care plan

offered on January 1, 2001, in the service area

of the individual.

‘‘(II) PERIOD OF APPLICATION.—Subclause (I)

shall only apply during the 1-year period beginning

on January 1, 2001.’’.

(b) EXCLUSION FROM DETERMINATION OF THE BUDGET NEUTRALITY FACTOR.—Section 1853(c)(5) (42 U.S.C. 1395w–23(c)(5)) is

amended by striking ‘‘subsection (i)’’ and inserting ‘‘subsections

(a)(3)(C)(iii) and (i)’’.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–559

SEC. 608. EXPANSION OF APPLICATION OF MEDICARE+CHOICE NEW

ENTRY BONUS.

(a) IN GENERAL.—Section 1853(i)(1) (42 U.S.C. 1395w–23(i)(1))

is amended in the matter preceding subparagraph (A) by inserting

‘‘, or filed notice with the Secretary as of October 3, 2000, that

they will not be offering such a plan as of January 1, 2001’’ after

‘‘January 1, 2000’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply as if included in the enactment of BBRA.

SEC. 609. REPORT ON INCLUSION OF CERTAIN COSTS OF THE DEPARTMENT OF VETERANS AFFAIRS AND MILITARY FACILITY

SERVICES IN CALCULATING MEDICARE+CHOICE PAYMENT RATES.

The Secretary of Health and Human Services shall report to

Congress by not later than January 1, 2003, on a method to phasein the costs of military facility services furnished by the Department

of Veterans Affairs, and the costs of military facility services furnished by the Department of Defense, to medicare-eligible beneficiaries in the calculation of an area’s Medicare+Choice capitation

payment. Such report shall include on a county-by-county basis—

(1) the actual or estimated cost of such services to medicareeligible beneficiaries;

(2) the change in Medicare+Choice capitation payment

rates if such costs are included in the calculation of payment

rates;

(3) one or more proposals for the implementation of payment adjustments to Medicare+Choice plans in counties where

the payment rate has been affected due to the failure to calculate the cost of such services to medicare-eligible beneficiaries; and

(4) a system to ensure that when a Medicare+Choice

enrollee receives covered services through a facility of the

Department of Veterans Affairs or the Department of Defense

there is an appropriate payment recovery to the medicare program under title XVIII of the Social Security Act.

Subtitle B—Other Medicare+Choice

Reforms

SEC. 611. PAYMENT OF ADDITIONAL AMOUNTS FOR NEW BENEFITS

COVERED DURING A CONTRACT TERM.

(a) IN GENERAL.—Section 1853(c)(7) (42 U.S.C. 1395w–23(c)(7))

is amended to read as follows:

‘‘(7) ADJUSTMENT FOR NATIONAL COVERAGE DETERMINATIONS

AND LEGISLATIVE CHANGES IN BENEFITS.—If the Secretary

makes a determination with respect to coverage under this

title or there is a change in benefits required to be provided

under this part that the Secretary projects will result in a

significant increase in the costs to Medicare+Choice of providing

benefits under contracts under this part (for periods after any

period described in section 1852(a)(5)), the Secretary shall

adjust appropriately the payments to such organizations under

this part. Such projection and adjustment shall be based on

an analysis by the Chief Actuary of the Health Care Financing

114 STAT. 2763A–560 PUBLIC LAW 106–554—APPENDIX F

Administration of the actuarial costs associated with the new

benefits.’’. (b) CONFORMING AMENDMENT.—Section 1852(a)(5) (42 U.S.C.

1395w–22(a)(5)) is amended— (1) in the heading, by inserting ‘‘AND LEGISLATIVE CHANGES

IN BENEFITS’’ after ‘‘NATIONAL COVERAGE DETERMINATIONS’’;

(2) by inserting ‘‘or legislative change in benefits required

to be provided under this part’’ after ‘‘national coverage determination’’;

(3) in subparagraph (A), by inserting ‘‘or legislative change

in benefits’’ after ‘‘such determination’’;

(4) in subparagraph (B), by inserting ‘‘or legislative change’’ after ‘‘if such coverage determination’’; and

(5) by adding at the end the following: ‘‘The projection under the previous sentence shall be based

on an analysis by the Chief Actuary of the Health Care Financing Administration of the actuarial costs associated with the

coverage determination or legislative change in benefits.’’.

(c) EFFECTIVE DATE.—The amendments made by this section

are effective on the date of the enactment of this Act and shall

apply to national coverage determinations and legislative changes

in benefits occurring on or after such date.

SEC. 612. RESTRICTION ON IMPLEMENTATION OF SIGNIFICANT NEW

REGULATORY REQUIREMENTS MIDYEAR.

(a) IN GENERAL.—Section 1856(b) (42 U.S.C. 1395w–26(b)) is

amended by adding at the end the following new paragraph:

‘‘(4) PROHIBITION OF MIDYEAR IMPLEMENTATION OF SIGNIFICANT NEW REGULATORY REQUIREMENTS.—The Secretary may

not implement, other than at the beginning of a calendar year,

regulations under this section that impose new, significant

regulatory requirements on a Medicare+Choice organization

or plan.’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

takes effect on the date of the enactment of this Act.

SEC. 613. TIMELY APPROVAL OF MARKETING MATERIAL THAT FOLLOWS MODEL MARKETING LANGUAGE.

(a) IN GENERAL.—Section 1851(h) (42 U.S.C. 1395w–21(h)) is

amended—

(1) in paragraph (1)(A), by inserting ‘‘(or 10 days in the

case described in paragraph (5))’’ after ‘‘45 days’’; and

(2) by adding at the end the following new paragraph:

‘‘(5) SPECIAL TREATMENT OF MARKETING MATERIAL FOLLOW- ING MODEL MARKETING LANGUAGE.—In the case of marketing

material of an organization that uses, without modification,

proposed model language specified by the Secretary, the period

specified in paragraph (1)(A) shall be reduced from 45 days

to 10 days.’’. (b) EFFECTIVE DATE.—The amendments made by subsection

(a) shall apply to marketing material submitted on or after January

1, 2001.

SEC. 614. AVOIDING DUPLICATIVE REGULATION.

(a) IN GENERAL.—Section 1856(b)(3)(B) (42 U.S.C. 1395w–

26(b)(3)(B)) is amended—

(1) in clause (i), by inserting ‘‘(including cost-sharing

requirements)’’ after ‘‘Benefit requirements’’; and

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–561

(2) by adding at the end the following new clause:

‘‘(iv) Requirements relating to marketing materials

and summaries and schedules of benefits regarding

a Medicare+Choice plan.’’.

(b) EFFECTIVE DATE.—The amendments made by subsection

(a) take effect on the date of the enactment of this Act.

SEC. 615. ELECTION OF UNIFORM LOCAL COVERAGE POLICY FOR

MEDICARE+CHOICE PLAN COVERING MULTIPLE LOCALITIES.

Section 1852(a)(2) (42 U.S.C. 1395w–22(a)(2)) is amended by

adding at the end the following new subparagraph:

‘‘(C) ELECTION OF UNIFORM COVERAGE POLICY.—In the

case of a Medicare+Choice organization that offers a

Medicare+Choice plan in an area in which more than one

local coverage policy is applied with respect to different

parts of the area, the organization may elect to have the

local coverage policy for the part of the area that is most

beneficial to Medicare+Choice enrollees (as identified by

the Secretary) apply with respect to all Medicare+Choice

enrollees enrolled in the plan.’’.

SEC. 616. ELIMINATING HEALTH DISPARITIES IN MEDICARE+CHOICE

PROGRAM.

(a) QUALITY ASSURANCE PROGRAM FOCUS ON RACIAL AND ETHNIC MINORITIES.—Subparagraphs (A) and (B) of section 1852(e)(2)

(42 U.S.C. 1395w–22(e)(2)) are each amended by adding at the

end the following:

‘‘Such program shall include a separate focus (with respect

to all the elements described in this subparagraph) on

racial and ethnic minorities.’’.

(b) REPORT.—Section 1852(e) (42 U.S.C. 1395w–22(e)) is amended by adding at the end the following new paragraph:

‘‘(5) REPORT TO CONGRESS.—

‘‘(A) IN GENERAL.—Not later than 2 years after the

date of the enactment of this paragraph, and biennially

thereafter, the Secretary shall submit to Congress a report

regarding how quality assurance programs conducted under

this subsection focus on racial and ethnic minorities.

‘‘(B) CONTENTS OF REPORT.—Each such report shall

include the following:

‘‘(i) A description of the means by which such

programs focus on such racial and ethnic minorities.

‘‘(ii) An evaluation of the impact of such programs

on eliminating health disparities and on improving

health outcomes, continuity and coordination of care,

management of chronic conditions, and consumer satisfaction.

‘‘(iii) Recommendations on ways to reduce clinical

outcome disparities among racial and ethnic minorities.’’.

SEC. 617. MEDICARE+CHOICE PROGRAM COMPATIBILITY WITH

EMPLOYER OR UNION GROUP HEALTH PLANS.

(a) IN GENERAL.—Section 1857 (42 U.S.C. 1395w–27) is amended by adding at the end the following new subsection:

114 STAT. 2763A–562 PUBLIC LAW 106–554—APPENDIX F

‘‘(i) MEDICARE+CHOICE PROGRAM COMPATIBILITY WITH

EMPLOYER OR UNION GROUP HEALTH PLANS.—To facilitate the offering of Medicare+Choice plans under contracts between

Medicare+Choice organizations and employers, labor organizations,

or the trustees of a fund established by one or more employers

or labor organizations (or combination thereof ) to furnish benefits

to the entity’s employees, former employees (or combination thereof )

or members or former members (or combination thereof ) of the

labor organizations, the Secretary may waive or modify requirements that hinder the design of, the offering of, or the enrollment

in such Medicare+Choice plans.’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply with respect to years beginning with 2001.

SEC. 618. SPECIAL MEDIGAP ENROLLMENT ANTIDISCRIMINATION

PROVISION FOR CERTAIN BENEFICIARIES.

(a) DISENROLLMENT WINDOW IN ACCORDANCE WITH BENEFICIARY’S CIRCUMSTANCE.—Section 1882(s)(3) (42 U.S.C.

1395ss(s)(3)) is amended—

(1) in subparagraph (A), in the matter following clause

(iii), by striking ‘‘, subject to subparagraph (E), seeks to enroll

under the policy not later than 63 days after the date of

the termination of enrollment described in such subparagraph’’

and inserting ‘‘seeks to enroll under the policy during the

period specified in subparagraph (E)’’; and

(2) by striking subparagraph (E) and inserting the following

new subparagraph:

‘‘(E) For purposes of subparagraph (A), the time period specified

in this subparagraph is—

‘‘(i) in the case of an individual described in subparagraph

(B)(i), the period beginning on the date the individual receives

a notice of termination or cessation of all supplemental health

benefits (or, if no such notice is received, notice that a claim

has been denied because of such a termination or cessation)

and ending on the date that is 63 days after the applicable

notice;

‘‘(ii) in the case of an individual described in clause (ii),

(iii), (v), or (vi) of subparagraph (B) whose enrollment is terminated involuntarily, the period beginning on the date that

the individual receives a notice of termination and ending on

the date that is 63 days after the date the applicable coverage

is terminated;

‘‘(iii) in the case of an individual described in subparagraph

(B)(iv)(I), the period beginning on the earlier of (I) the date

that the individual receives a notice of termination, a notice

of the issuer’s bankruptcy or insolvency, or other such similar

notice, if any, and (II) the date that the applicable coverage

is terminated, and ending on the date that is 63 days after

the date the coverage is terminated;

‘‘(iv) in the case of an individual described in clause (ii),

(iii), (iv)(II), (iv)(III), (v), or (vi) of subparagraph (B) who

disenrolls voluntarily, the period beginning on the date that

is 60 days before the effective date of the disenrollment and

ending on the date that is 63 days after such effective date;

and

‘‘(v) in the case of an individual described in subparagraph

(B) but not described in the preceding provisions of this

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–563

subparagraph, the period beginning on the effective date of

the disenrollment and ending on the date that is 63 days

after such effective date.’’. (b) EXTENDED MEDIGAP ACCESS FOR INTERRUPTED TRIAL PERI- ODS.—Section 1882(s)(3) (42 U.S.C. 1395ss(s)(3)), as amended by

subsection (a), is further amended by adding at the end the following

new subparagraph: ‘‘(F)(i) Subject to clause (ii), for purposes of this paragraph— ‘‘(I) in the case of an individual described in subparagraph

(B)(v) (or deemed to be so described, pursuant to this subparagraph) whose enrollment with an organization or provider

described in subclause (II) of such subparagraph is involuntarily

terminated within the first 12 months of such enrollment, and

who, without an intervening enrollment, enrolls with another

such organization or provider, such subsequent enrollment shall

be deemed to be an initial enrollment described in such

subparagraph; and ‘‘(II) in the case of an individual described in clause (vi)

of subparagraph (B) (or deemed to be so described, pursuant

to this subparagraph) whose enrollment with a plan or in

a program described in such clause is involuntarily terminated

within the first 12 months of such enrollment, and who, without

an intervening enrollment, enrolls in another such plan or

program, such subsequent enrollment shall be deemed to be

an initial enrollment described in such clause.

‘‘(ii) For purposes of clauses (v) and (vi) of subparagraph (B),

no enrollment of an individual with an organization or provider

described in clause (v)(II), or with a plan or in a program described

in clause (vi), may be deemed to be an initial enrollment under

this clause after the 2-year period beginning on the date on which

the individual first enrolled with such an organization, provider,

plan, or program.’’.

SEC. 619. RESTORING EFFECTIVE DATE OF ELECTIONS AND CHANGES

OF ELECTIONS OF MEDICARE+CHOICE PLANS.

(a) OPEN ENROLLMENT.—Section 1851(f )(2) (42 U.S.C. 1395w–

21(f )(2)) is amended by striking ‘‘, except that if such election

or change is made after the 10th day of any calendar month,

then the election or change shall not take effect until the first

day of the second calendar month following the date on which

the election or change is made’’.

(b) EFFECTIVE DATE.—The amendment made by this section

shall apply to elections and changes of coverage made on or after

June 1, 2001.

SEC. 620. PERMITTING ESRD BENEFICIARIES TO ENROLL IN ANOTHER

MEDICARE+CHOICE PLAN IF THE PLAN IN WHICH THEY

ARE ENROLLED IS TERMINATED.

(a) IN GENERAL.—Section 1851(a)(3)(B) (42 U.S.C. 1395w–

21(a)(3)(B)) is amended by striking ‘‘except that’’ and all that follows

and inserting the following: ‘‘except that— ‘‘(i) an individual who develops end-stage renal

disease while enrolled in a Medicare+Choice plan may

continue to be enrolled in that plan; and

‘‘(ii) in the case of such an individual who is

enrolled in a Medicare+Choice plan under clause (i)

(or subsequently under this clause), if the enrollment

114 STAT. 2763A–564 PUBLIC LAW 106–554—APPENDIX F

is discontinued under circumstances described in section 1851(e)(4)(A), then the individual will be treated

as a ‘Medicare+Choice eligible individual’ for purposes

of electing to continue enrollment in another

Medicare+Choice plan.’’.

(b) EFFECTIVE DATE.—

(1) IN GENERAL.—The amendment made by subsection (a)

shall apply to terminations and discontinuations occurring on

or after the date of the enactment of this Act.

(2) APPLICATION TO PRIOR PLAN TERMINATIONS.—Clause (ii)

of section 1851(a)(3)(B) of the Social Security Act (as inserted

by subsection (a)) shall also apply to individuals whose enrollment in a Medicare+Choice plan was terminated or discontinued after December 31, 1998, and before the date of the

enactment of this Act. In applying this paragraph, such an

individual shall be treated, for purposes of part C of title

XVIII of the Social Security Act, as having discontinued enrollment in such a plan as of the date of the enactment of this

Act.

SEC. 621. PROVIDING CHOICE FOR SKILLED NURSING FACILITY SERVICES UNDER THE MEDICARE+CHOICE PROGRAM.

(a) IN GENERAL.—Section 1852 (42 U.S.C. 1395w–22) is amended by adding at the end the following new subsection:

‘‘(l) RETURN TO HOME SKILLED NURSING FACILITIES FOR COVERED POST-HOSPITAL EXTENDED CARE SERVICES.—

‘‘(1) ENSURING RETURN TO HOME SNF.—

‘‘(A) IN GENERAL.—In providing coverage of post-hospital extended care services, a Medicare+Choice plan shall

provide for such coverage through a home skilled nursing

facility if the following conditions are met:

‘‘(i) ENROLLEE ELECTION.—The enrollee elects to

receive such coverage through such facility.

‘‘(ii) SNF AGREEMENT.—The facility has a contract

with the Medicare+Choice organization for the provision of such services, or the facility agrees to accept

substantially similar payment under the same terms

and conditions that apply to similarly situated skilled

nursing facilities that are under contract with the

Medicare+Choice organization for the provision of such

services and through which the enrollee would otherwise receive such services.

‘‘(B) MANNER OF PAYMENT TO HOME SNF.—The

organization shall provide payment to the home skilled

nursing facility consistent with the contract or the agreement described in subparagraph (A)(ii), as the case may

be.

‘‘(2) NO LESS FAVORABLE COVERAGE.—The coverage provided

under paragraph (1) (including scope of services, cost-sharing,

and other criteria of coverage) shall be no less favorable to

the enrollee than the coverage that would be provided to the

enrollee with respect to a skilled nursing facility the posthospital extended care services of which are otherwise covered

under the Medicare+Choice plan.

‘‘(3) RULE OF CONSTRUCTION.—Nothing in this subsection

shall be construed to do the following:

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–565

‘‘(A) To require coverage through a skilled nursing

facility that is not otherwise qualified to provide benefits

under part A for medicare beneficiaries not enrolled in

a Medicare+Choice plan.

‘‘(B) To prevent a skilled nursing facility from refusing

to accept, or imposing conditions upon the acceptance of,

an enrollee for the receipt of post-hospital extended care

services.

‘‘(4) DEFINITIONS.—In this subsection:

‘‘(A) HOME SKILLED NURSING FACILITY.—The term

‘home skilled nursing facility’ means, with respect to an

enrollee who is entitled to receive post-hospital extended

care services under a Medicare+Choice plan, any of the

following skilled nursing facilities:

‘‘(i) SNF RESIDENCE AT TIME OF ADMISSION.—The

skilled nursing facility in which the enrollee resided

at the time of admission to the hospital preceding

the receipt of such post-hospital extended care services.

‘‘(ii) SNF IN CONTINUING CARE RETIREMENT COMMUNITY.—A skilled nursing facility that is providing such

services through a continuing care retirement community (as defined in subparagraph (B)) which provided

residence to the enrollee at the time of such admission.

‘‘(iii) SNF RESIDENCE OF SPOUSE AT TIME OF DISCHARGE.—The skilled nursing facility in which the

spouse of the enrollee is residing at the time of discharge from such hospital.

‘‘(B) CONTINUING CARE RETIREMENT COMMUNITY.—The

term ‘continuing care retirement community’ means, with

respect to an enrollee in a Medicare+Choice plan, an

arrangement under which housing and health-related services are provided (or arranged) through an organization

for the enrollee under an agreement that is effective for

the life of the enrollee or for a specified period.’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply with respect to contracts entered into or renewed on

or after the date of the enactment of this Act.

(c) MEDPAC STUDY.—

(1) STUDY.—The Medicare Payment Advisory Commission

shall conduct a study analyzing the effects of the amendment

made by subsection (a) on Medicare+Choice organizations. In

conducting such study, the Commission shall examine the

effects (if any) such amendment has had—

(A) on the scope of additional benefits provided under

the Medicare+Choice program;

(B) on the administrative and other costs incurred

by Medicare+Choice organizations; and

(C) on the contractual relationships between such

organizations and skilled nursing facilities.

(2) REPORT.—Not later than 2 years after the date of the

enactment of this Act, the Commission shall submit to Congress

a report on the study conducted under paragraph (1).

114 STAT. 2763A–566 PUBLIC LAW 106–554—APPENDIX F

SEC. 622. PROVIDING FOR ACCOUNTABILITY OF MEDICARE+CHOICE

PLANS.

(a) MANDATORY REVIEW OF ACR SUBMISSIONS BY THE CHIEF

ACTUARY OF THE HEALTH CARE FINANCING ADMINISTRATION.—Section 1854(a)(5)(A) (42 U.S.C. 1395w–24(a)(5)(A)) is amended—

(1) by striking ‘‘value’’ and inserting ‘‘values’’; and

(2) by adding at the end the following: ‘‘The Chief Actuary

of the Health Care Financing Administration shall review the

actuarial assumptions and data used by the Medicare+Choice

organization with respect to such rates, amounts, and values

so submitted to determine the appropriateness of such assumptions and data.’’.

(b) EFFECTIVE DATE.—The amendments made by subsection

(a) shall apply to submissions made on or after May 1, 2001.

SEC. 623. INCREASED CIVIL MONEY PENALTY FOR MEDICARE+CHOICE

ORGANIZATIONS THAT TERMINATE CONTRACTS MIDYEAR.

(a) IN GENERAL.—Section 1857(g)(3) (42 U.S.C. 1395w–27(g)(3))

is amended by adding at the end the following new subparagraph:

‘‘(D) Civil monetary penalties of not more than

$100,000, or such higher amount as the Secretary may

establish by regulation, where the finding under subsection

(c)(2)(A) is based on the organization’s termination of its

contract under this section other than at a time and in

a manner provided for under subsection (a).’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to terminations occurring after the date of the enactment

of this Act.

Subtitle C—Other Managed Care Reforms

SEC. 631. ONE-YEAR EXTENSION OF SOCIAL HEALTH MAINTENANCE

ORGANIZATION (SHMO) DEMONSTRATION PROJECT.

Section 4018(b)(1) of the Omnibus Budget Reconciliation Act

of 1987, as amended by section 531(a)(1) of BBRA (113 Stat. 1501A–

388), is amended by striking ‘‘18 months’’ and inserting ‘‘30 months’’.

SEC. 632. REVISED TERMS AND CONDITIONS FOR EXTENSION OF MEDICARE COMMUNITY NURSING ORGANIZATION (CNO) DEMONSTRATION PROJECT.

(a) IN GENERAL.—Section 532 of BBRA (113 Stat. 1501A–388)

is amended—

(1) in subsection (a), by striking the second sentence; and

(2) by striking subsection (b) and inserting the following

new subsection:

‘‘(b) TERMS AND CONDITIONS.—

‘‘(1) JANUARY THROUGH SEPTEMBER 2000.—For the 9-month

period beginning with January 2000, any such demonstration

project shall be conducted under the same terms and conditions

as applied to such demonstration during 1999.

‘‘(2) OCTOBER 2000 THROUGH DECEMBER 2001.—For the 15-

month period beginning with October 2000, any such demonstration project shall be conducted under the same terms

and conditions as applied to such demonstration during 1999,

except that the following modifications shall apply:

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–567

‘‘(A) BASIC CAPITATION RATE.—The basic capitation rate

paid for services covered under the project (other than

case management services) per enrollee per month and

furnished during—

‘‘(i) the period beginning with October 1, 2000,

and ending with December 31, 2000, shall be determined by actuarially adjusting the actual capitation

rate paid for such services in 1999 for inflation, utilization, and other changes to the CNO service package,

and by reducing such adjusted capitation rate by 10

percent in the case of the demonstration sites located

in Arizona, Minnesota, and Illinois, and 15 percent

for the demonstration site located in New York; and

‘‘(ii) 2001 shall be determined by actuarially

adjusting the capitation rate determined under clause

(i) for inflation, utilization, and other changes to the

CNO service package.

‘‘(B) TARGETED CASE MANAGEMENT FEE.—Effective

October 1, 2000—

‘‘(i) the case management fee per enrollee per

month for—

‘‘(I) the period described in subparagraph (A)(i)

shall be determined by actuarially adjusting the

case management fee for 1999 for inflation; and

‘‘(II) 2001 shall be determined by actuarially

adjusting the amount determined under subclause

(I) for inflation; and

‘‘(ii) such case management fee shall be paid only

for enrollees who are classified as moderately frail

or frail pursuant to criteria established by the Secretary.

‘‘(C) GREATER UNIFORMITY IN CLINICAL FEATURES

AMONG SITES.—Each project shall implement for each site—

‘‘(i) protocols for periodic telephonic contact with

enrollees based on—

‘‘(I) the results of such standardized written

health assessment; and

‘‘(II) the application of appropriate care planning approaches;

‘‘(ii) disease management programs for targeted

diseases (such as congestive heart failure, arthritis,

diabetes, and hypertension) that are highly prevalent

in the enrolled populations;

‘‘(iii) systems and protocols to track enrollees

through hospitalizations, including pre-admission planning, concurrent management during inpatient hospital stays, and post-discharge assessment, planning,

and follow-up; and

‘‘(iv) standardized patient educational materials for

specified diseases and health conditions.

‘‘(D) QUALITY IMPROVEMENT.—Each project shall implement at each site once during the 15-month period—

‘‘(i) enrollee satisfaction surveys; and

‘‘(ii) reporting on specified quality indicators for

the enrolled population.

‘‘(c) EVALUATION.—

114 STAT. 2763A–568 PUBLIC LAW 106–554—APPENDIX F

‘‘(1) PRELIMINARY REPORT.—Not later than July 1, 2001,

the Secretary of Health and Human Services shall submit

to the Committees on Ways and Means and Commerce of

the House of Representatives and the Committee on Finance

of the Senate a preliminary report that— ‘‘(A) evaluates such demonstration projects for the

period beginning July 1, 1997, and ending December 31,

1999, on a site-specific basis with respect to the impact

on per beneficiary spending, specific health utilization

measures, and enrollee satisfaction; and ‘‘(B) includes a similar evaluation of such projects for

the portion of the extension period that occurs after

September 30, 2000.

‘‘(2) FINAL REPORT.—The Secretary shall submit a final

report to such Committees on such demonstration projects not

later than July 1, 2002. Such report shall include the same

elements as the preliminary report required by paragraph (1),

but for the period after December 31, 1999. ‘‘(3) METHODOLOGY FOR SPENDING COMPARISONS.—Any

evaluation of the impact of the demonstration projects on per

beneficiary spending included in such reports shall include

a comparison of— ‘‘(A) data for all individuals who— ‘‘(i) were enrolled in such demonstration projects

as of the first day of the period under evaluation;

and ‘‘(ii) were enrolled for a minimum of 6 months

thereafter; with

‘‘(B) data for a matched sample of individuals who

are enrolled under part B of title XVIII of the Social Security Act and are not enrolled in such a project, or in

a Medicare+Choice plan under part C of such title, a plan

offered by an eligible organization under section 1876 of

such Act, or a health care prepayment plan under section

1833(a)(1)(A) of such Act.’’. (b) EFFECTIVE DATE.—The amendments made by subsection

(a) shall be effective as if included in the enactment of section

532 of BBRA (113 Stat. 1501A–388).

SEC. 633. EXTENSION OF MEDICARE MUNICIPAL HEALTH SERVICES

DEMONSTRATION PROJECTS.

Section 9215(a) of the Consolidated Omnibus Budget Reconciliation Act of 1985 (42 U.S.C. 1395b–1 note), as amended by section

6135 of the Omnibus Budget Reconciliation Act of 1989, section

13557 of the Omnibus Budget Reconciliation Act of 1993, section

4017 of BBA, and section 534 of BBRA (113 Stat. 1501A–390),

is amended by striking ‘‘December 31, 2002’’ and inserting ‘‘December 31, 2004’’.

SEC. 634. SERVICE AREA EXPANSION FOR MEDICARE COST CONTRACTS DURING TRANSITION PERIOD.

Section 1876(h)(5) (42 U.S.C. 1395mm(h)(5)) is amended— (1) by redesignating subparagraph (B) as subparagraph

(C); and

(2) by inserting after subparagraph (A), the following new

subparagraph:

‘‘(B) Subject to subparagraph (C), the Secretary shall approve

an application for a modification to a reasonable cost contract

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–569

under this section in order to expand the service area of such

contract if—

‘‘(i) such application is submitted to the Secretary on or

before September 1, 2003; and

‘‘(ii) the Secretary determines that the organization with

the contract continues to meet the requirements applicable

to such organizations and contracts under this section.’’.

TITLE VII—MEDICAID

SEC. 701. DSH PAYMENTS.

(a) MODIFICATIONS TO DSH ALLOTMENTS.— (1) INCREASED ALLOTMENTS FOR FISCAL YEARS 2001 AND

2002.— (A) IN GENERAL.—Section 1923(f ) (42 U.S.C. 1396r– 4(f )) is amended— (i) in paragraph (2), by striking ‘‘The DSH allotment’’ and inserting ‘‘Subject to paragraph (4), the

DSH allotment’’;

(ii) by redesignating paragraph (4) as paragraph

(6); and

(iii) by inserting after paragraph (3) the following

new paragraph: ‘‘(4) SPECIAL RULE FOR FISCAL YEARS 2001 AND 2002.—

‘‘(A) IN GENERAL.—Notwithstanding paragraph (2), the

DSH allotment for any State for—

‘‘(i) fiscal year 2001, shall be the DSH allotment

determined under paragraph (2) for fiscal year 2000

increased, subject to subparagraph (B) and paragraph

(5), by the percentage change in the consumer price

index for all urban consumers (all items; U.S. city

average) for fiscal year 2000; and

‘‘(ii) fiscal year 2002, shall be the DSH allotment

determined under clause (i) increased, subject to

subparagraph (B) and paragraph (5), by the percentage

change in the consumer price index for all urban

consumers (all items; U.S. city average) for fiscal year

2001.

‘‘(B) LIMITATION.—Subparagraph (B) of paragraph (3)

shall apply to subparagraph (A) of this paragraph in the

same manner as that subparagraph (B) applies to paragraph (3)(A).

‘‘(C) NO APPLICATION TO ALLOTMENTS AFTER FISCAL

YEAR 2002.—The DSH allotment for any State for fiscal

year 2003 or any succeeding fiscal year shall be determined

under paragraph (3) without regard to the DSH allotments

determined under subparagraph (A) of this paragraph.’’.

(2) SPECIAL RULE FOR MEDICAID DSH ALLOTMENT FOR

EXTREMELY LOW DSH STATES.—

(A) IN GENERAL.—Section 1923(f ) (42 U.S.C. 1396r– 4(f )), as amended by paragraph (1), is amended by inserting

after paragraph (4) the following new paragraph:

‘‘(5) SPECIAL RULE FOR EXTREMELY LOW DSH STATES.—In

the case of a State in which the total expenditures under

the State plan (including Federal and State shares) for disproportionate share hospital adjustments under this section

114 STAT. 2763A–570 PUBLIC LAW 106–554—APPENDIX F

for fiscal year 1999, as reported to the Administrator of the

Health Care Financing Administration as of August 31, 2000,

is greater than 0 but less than 1 percent of the State’s total

amount of expenditures under the State plan for medical assistance during the fiscal year, the DSH allotment for fiscal year

2001 shall be increased to 1 percent of the State’s total amount

of expenditures under such plan for such assistance during

such fiscal year. In subsequent fiscal years, such increased

allotment is subject to an increase for inflation as provided

in paragraph (3)(A).’’.

(B) CONFORMING AMENDMENT.—Section 1923(f )(3)(A)

(42 U.S.C. 1396r–4(f )(3)(A)) is amended by inserting ‘‘and

paragraph (5)’’ after ‘‘subparagraph (B)’’.

(3) EFFECTIVE DATE.—The amendments made by paragraphs (1) and (2) take effect on the date the final regulation

required under section 705(a) (relating to the application of

an aggregate upper payment limit test for State medicaid

spending for inpatient hospital services, outpatient hospital

services, nursing facility services, intermediate care facility

services for the mentally retarded, and clinic services provided

by government facilities that are not State-owned or operated

facilities) is published in the Federal Register.

(b) ASSURING IDENTIFICATION OF MEDICAID MANAGED CARE

PATIENTS.—

(1) IN GENERAL.—Section 1932 (42 U.S.C. 1396u–2) is

amended by adding at the end the following new subsection:

‘‘(g) IDENTIFICATION OF PATIENTS FOR PURPOSES OF MAKING

DSH PAYMENTS.—Each contract with a managed care entity under

section 1903(m) or under section 1905(t)(3) shall require the entity

either—

‘‘(1) to report to the State information necessary to determine the hospital services provided under the contract (and

the identity of hospitals providing such services) for purposes

of applying sections 1886(d)(5)(F) and 1923; or

‘‘(2) to include a sponsorship code in the identification

card issued to individuals covered under this title in order

that a hospital may identify a patient as being entitled to

benefits under this title.’’.

(2) CLARIFICATION OF COUNTING MANAGED CARE MEDICAID

PATIENTS.—Section 1923 (42 U.S.C. 1396r–4) is amended—

(A) in subsection (a)(2)(D), by inserting after ‘‘the

proportion of low-income and medicaid patients’’ the following: ‘‘(including such patients who receive benefits through

a managed care entity)’’;

(B) in subsection (b)(2), by inserting after ‘‘a State

plan approved under this title in a period’’ the following:

‘‘(regardless of whether such patients receive medical

assistance on a fee-for-service basis or through a managed

care entity)’’; and

(C) in subsection (b)(3)(A)(i), by inserting after ‘‘under

a State plan under this title’’ the following: ‘‘(regardless

of whether the services were furnished on a fee-for-service

basis or through a managed care entity)’’.

(3) EFFECTIVE DATES.—

(A) The amendment made by paragraph (1) shall apply

to contracts as of January 1, 2001.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–571

(B) The amendments made by paragraph (2) shall

apply to payments made on or after January 1, 2001.

(c) APPLICATION OF MEDICAID DSH TRANSITION RULE TO PUBLIC

HOSPITALS IN ALL STATES.— (1) IN GENERAL.—During the period described in paragraph

(3), with respect to a State, section 4721(e) of the Balanced

Budget Act of 1997 (Public Law 105–33; 111 Stat. 514), as

amended by section 607 of BBRA (113 Stat. 1501A–396), shall

be applied as though— (A) ‘‘September 30, 2002’’ were substituted for ‘‘July

1, 1997’’ each place it appears;

(B) ‘‘hospitals owned or operated by a State (as defined

for purposes of title XIX of such Act), or by an instrumentality or a unit of government within a State (as so defined)’’ were substituted for ‘‘the State of California’’;

(C) paragraph (3) were redesignated as paragraph (4);

(D) ‘‘and’’ were omitted from the end of paragraph

(2); and

(E) the following new paragraph were inserted after

paragraph (2):

‘‘(3) ‘(as defined in subparagraph (B) but without regard

to clause (ii) of that subparagraph and subject to subsection

(d))’ were substituted for ‘(as defined in subparagraph (B))’ in subparagraph (A) of such section; and’’. (2) SPECIAL RULE.—With respect to California, section

4721(e) of the Balanced Budget Act of 1997 (Public Law 105–

33; 111 Stat. 514), as so amended, shall be applied without

regard to paragraph (1).

(3) PERIOD DESCRIBED.—The period described in this paragraph is the period that begins, with respect to a State, on

the first day of the first State fiscal year that begins after

September 30, 2002, and ends on the last day of the succeeding

State fiscal year.

(4) APPLICATION TO WAIVERS.—With respect to a State

operating under a waiver of the requirements of title XIX

of the Social Security Act (42 U.S.C. 1396 et seq.) under section

1115 of such Act (42 U.S.C. 1315), the amount by which any

payment adjustment made by the State under title XIX of

such Act (42 U.S.C. 1396 et seq.), after the application of

section 4721(e) of the Balanced Budget Act of 1997 under

paragraph (1) to such State, exceeds the costs of furnishing

hospital services provided by hospitals described in such section

shall be fully reflected as an increase in the baseline expenditure limit for such waiver.

(d) ASSISTANCE FOR CERTAIN PUBLIC HOSPITALS.—

(1) IN GENERAL.—Beginning with fiscal year 2002, notwithstanding section 1923(f ) of the Social Security Act (42 U.S.C.

1396r–4(f )) and subject to paragraph (3), with respect to a

State, payment adjustments made under title XIX of the Social

Security Act (42 U.S.C. 1396 et seq.) to a hospital described

in paragraph (2) shall be made without regard to the DSH

allotment limitation for the State determined under section

1923(f ) of that Act (42 U.S.C. 1396r–4(f )).

(2) HOSPITAL DESCRIBED.—A hospital is described in this

paragraph if the hospital—

(A) is owned or operated by a State (as defined for

purposes of title XIX of the Social Security Act), or by

114 STAT. 2763A–572 PUBLIC LAW 106–554—APPENDIX F

an instrumentality or a unit of government within a State

(as so defined);

(B) as of October 1, 2000— (i) is in existence and operating as a hospital

described in subparagraph (A); and

(ii) is not receiving disproportionate share hospital

payments from the State in which it is located under

title XIX of such Act; and

(C) has a low-income utilization rate (as defined in

section 1923(b)(3) of the Social Security Act (42 U.S.C.

1396r–4(b)(3))) in excess of 65 percent.

(3) LIMITATION ON EXPENDITURES.— (A) IN GENERAL.—With respect to any fiscal year, the

aggregate amount of Federal financial participation that

may be provided for payment adjustments described in

paragraph (1) for that fiscal year for all States may not

exceed the amount described in subparagraph (B) for the

fiscal year.

(B) AMOUNT DESCRIBED.—The amount described in this

subparagraph for a fiscal year is as follows:

(i) For fiscal year 2002, $15,000,000.

(ii) For fiscal year 2003, $176,000,000.

(iii) For fiscal year 2004, $269,000,000.

(iv) For fiscal year 2005, $330,000,000.

(v) For fiscal year 2006 and each fiscal year thereafter, $375,000,000.

(e) DSH PAYMENT ACCOUNTABILITY STANDARDS.—Not later

than September 30, 2002, the Secretary of Health and Human

Services shall implement accountability standards to ensure that

Federal funds provided with respect to disproportionate share hospital adjustments made under section 1923 of the Social Security

Act (42 U.S.C. 1396r–4) are used to reimburse States and hospitals

eligible for such payment adjustments for providing uncompensated

health care to low-income patients and are otherwise made in

accordance with the requirements of section 1923 of that Act.

SEC. 702. NEW PROSPECTIVE PAYMENT SYSTEM FOR FEDERALLYQUALIFIED HEALTH CENTERS AND RURAL HEALTH CLINICS.

(a) IN GENERAL.—Section 1902(a) (42 U.S.C. 1396a(a)) is

amended—

(1) in paragraph (13)—

(A) in subparagraph (A), by adding ‘‘and’’ at the end;

(B) in subparagraph (B), by striking ‘‘and’’ at the end;

and

(C) by striking subparagraph (C); and

(2) by inserting after paragraph (14) the following new

paragraph:

‘‘(15) provide for payment for services described in clause

(B) or (C) of section 1905(a)(2) under the plan in accordance

with subsection (aa);’’.

(b) NEW PROSPECTIVE PAYMENT SYSTEM.—Section 1902 (42

U.S.C. 1396a) is amended by adding at the end the following:

‘‘(aa) PAYMENT FOR SERVICES PROVIDED BY FEDERALLY-QUALIFIED HEALTH CENTERS AND RURAL HEALTH CLINICS.— ‘‘(1) IN GENERAL.—Beginning with fiscal year 2001 with

respect to services furnished on or after January 1, 2001, and

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–573

each succeeding fiscal year, the State plan shall provide for

payment for services described in section 1905(a)(2)(C) furnished by a Federally-qualified health center and services

described in section 1905(a)(2)(B) furnished by a rural health

clinic in accordance with the provisions of this subsection.

‘‘(2) FISCAL YEAR 2001.—Subject to paragraph (4), for services furnished on and after January 1, 2001, during fiscal

year 2001, the State plan shall provide for payment for such

services in an amount (calculated on a per visit basis) that

is equal to 100 percent of the average of the costs of the

center or clinic of furnishing such services during fiscal years

1999 and 2000 which are reasonable and related to the cost

of furnishing such services, or based on such other tests of

reasonableness as the Secretary prescribes in regulations under

section 1833(a)(3), or, in the case of services to which such

regulations do not apply, the same methodology used under

section 1833(a)(3), adjusted to take into account any increase

or decrease in the scope of such services furnished by the

center or clinic during fiscal year 2001. ‘‘(3) FISCAL YEAR 2002 AND SUCCEEDING FISCAL YEARS.—

Subject to paragraph (4), for services furnished during fiscal

year 2002 or a succeeding fiscal year, the State plan shall

provide for payment for such services in an amount (calculated

on a per visit basis) that is equal to the amount calculated

for such services under this subsection for the preceding fiscal

year—

‘‘(A) increased by the percentage increase in the MEI

(as defined in section 1842(i)(3)) applicable to primary care

services (as defined in section 1842(i)(4)) for that fiscal

year; and

‘‘(B) adjusted to take into account any increase or

decrease in the scope of such services furnished by the

center or clinic during that fiscal year.

‘‘(4) ESTABLISHMENT OF INITIAL YEAR PAYMENT AMOUNT FOR

NEW CENTERS OR CLINICS.—In any case in which an entity

first qualifies as a Federally-qualified health center or rural

health clinic after fiscal year 2000, the State plan shall provide

for payment for services described in section 1905(a)(2)(C) furnished by the center or services described in section

1905(a)(2)(B) furnished by the clinic in the first fiscal year

in which the center or clinic so qualifies in an amount (calculated on a per visit basis) that is equal to 100 percent

of the costs of furnishing such services during such fiscal year

based on the rates established under this subsection for the

fiscal year for other such centers or clinics located in the

same or adjacent area with a similar case load or, in the

absence of such a center or clinic, in accordance with the

regulations and methodology referred to in paragraph (2) or

based on such other tests of reasonableness as the Secretary

may specify. For each fiscal year following the fiscal year in

which the entity first qualifies as a Federally-qualified health

center or rural health clinic, the State plan shall provide for

the payment amount to be calculated in accordance with paragraph (3).

‘‘(5) ADMINISTRATION IN THE CASE OF MANAGED CARE.— ‘‘(A) IN GENERAL.—In the case of services furnished

by a Federally-qualified health center or rural health clinic

114 STAT. 2763A–574 PUBLIC LAW 106–554—APPENDIX F

pursuant to a contract between the center or clinic and

a managed care entity (as defined in section 1932(a)(1)(B)),

the State plan shall provide for payment to the center

or clinic by the State of a supplemental payment equal

to the amount (if any) by which the amount determined

under paragraphs (2), (3), and (4) of this subsection exceeds

the amount of the payments provided under the contract.

‘‘(B) PAYMENT SCHEDULE.—The supplemental payment

required under subparagraph (A) shall be made pursuant

to a payment schedule agreed to by the State and the

Federally-qualified health center or rural health clinic, but

in no case less frequently than every 4 months.

‘‘(6) ALTERNATIVE PAYMENT METHODOLOGIES.—Notwithstanding any other provision of this section, the State plan

may provide for payment in any fiscal year to a Federallyqualified health center for services described in section

1905(a)(2)(C) or to a rural health clinic for services described

in section 1905(a)(2)(B) in an amount which is determined

under an alternative payment methodology that— ‘‘(A) is agreed to by the State and the center or clinic;

and ‘‘(B) results in payment to the center or clinic of an

amount which is at least equal to the amount otherwise

required to be paid to the center or clinic under this section.’’. (c) CONFORMING AMENDMENTS.—

(1) Section 4712 of the BBA (Public Law 105–33; 111 Stat.

508) is amended by striking subsection (c).

(2) Section 1915(b) (42 U.S.C. 1396n(b)) is amended by

striking ‘‘1902(a)(13)(C)’’ and inserting ‘‘1902(a)(15), 1902(aa),’’.

(d) GAO STUDY OF FUTURE REBASING.—The Comptroller General of the United States shall provide for a study on the need

for, and how to, rebase or refine costs for making payment under

the medicaid program for services provided by Federally-qualified

health centers and rural health clinics (as provided under the

amendments made by this section). The Comptroller General shall

provide for submittal of a report on such study to Congress by

not later than 4 years after the date of the enactment of this

Act.

(e) EFFECTIVE DATE.—The amendments made by this section

take effect on January 1, 2001, and shall apply to services furnished

on or after such date.

SEC. 703. STREAMLINED APPROVAL OF CONTINUED STATE-WIDE SECTION 1115 MEDICAID WAIVERS.

(a) IN GENERAL.—Section 1115 (42 U.S.C. 1315) is amended

by adding at the end the following new subsection:

‘‘(f ) An application by the chief executive officer of a State

for an extension of a waiver project the State is operating under

an extension under subsection (e) (in this subsection referred to

as the ‘waiver project’) shall be submitted and approved or disapproved in accordance with the following:

‘‘(1) The application for an extension of the waiver project

shall be submitted to the Secretary at least 120 days prior

to the expiration of the current period of the waiver project.

‘‘(2) Not later than 45 days after the date such application

is received by the Secretary, the Secretary shall notify the

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–575

State if the Secretary intends to review the terms and conditions of the waiver project. A failure to provide such notification

shall be deemed to be an approval of the application. ‘‘(3) Not later than 45 days after the date a notification

is made in accordance with paragraph (2), the Secretary shall

inform the State of proposed changes in the terms and conditions of the waiver project. A failure to provide such information

shall be deemed to be an approval of the application. ‘‘(4) During the 30-day period that begins on the date

information described in paragraph (3) is provided to a State,

the Secretary shall negotiate revised terms and conditions of

the waiver project with the State. ‘‘(5)(A) Not later than 120 days after the date an application

for an extension of the waiver project is submitted to the

Secretary (or such later date agreed to by the chief executive

officer of the State), the Secretary shall— ‘‘(i) approve the application subject to such modifications in the terms and conditions— ‘‘(I) as have been agreed to by the Secretary and

the State; or ‘‘(II) in the absence of such agreement, as are

determined by the Secretary to be reasonable, consistent with the overall objectives of the waiver project,

and not in violation of applicable law; or

‘‘(ii) disapprove the application. ‘‘(B) A failure by the Secretary to approve or disapprove

an application submitted under this subsection in accordance

with the requirements of subparagraph (A) shall be deemed

to be an approval of the application subject to such modifications in the terms and conditions as have been agreed to

(if any) by the Secretary and the State. ‘‘(6) An approval of an application for an extension of

a waiver project under this subsection shall be for a period

not to exceed 3 years. ‘‘(7) An extension of a waiver project under this subsection

shall be subject to the final reporting and evaluation requirements of paragraphs (4) and (5) of subsection (e) (taking into

account the extension under this subsection with respect to

any timing requirements imposed under those paragraphs).’’. (b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall apply to requests for extensions of demonstration projects

pending or submitted on or after the date of the enactment of

this Act.

SEC. 704. MEDICAID COUNTY-ORGANIZED HEALTH SYSTEMS.

(a) IN GENERAL.—Section 9517(c)(3)(C) of the Comprehensive

Omnibus Budget Reconciliation Act of 1985 is amended by striking

‘‘10 percent’’ and inserting ‘‘14 percent’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

takes effect on the date of the enactment of this Act.

SEC. 705. DEADLINE FOR ISSUANCE OF FINAL REGULATION RELATING

TO MEDICAID UPPER PAYMENT LIMITS.

(a) IN GENERAL.—Not later than December 31, 2000, the Secretary of Health and Human Services (in this section referred

to as the ‘‘Secretary’’), notwithstanding any requirement of the

Administrative Procedures Act under chapter 5 of title 5, United

States Code, or any other provision of law, shall issue under sections

114 STAT. 2763A–576 PUBLIC LAW 106–554—APPENDIX F

447.272, 447.304, and 447.321 of title 42, Code of Federal Regulations (and any other section of part 447 of title 42, Code of Federal

Regulations that the Secretary determines is appropriate), a final

regulation based on the proposed rule announced on October 5,

2000, that—

(1) modifies the upper payment limit test applied to State

medicaid spending for inpatient hospital services, outpatient

hospital services, nursing facility services, intermediate care

facility services for the mentally retarded, and clinic services

by applying an aggregate upper payment limit to payments

made to government facilities that are not State-owned or operated facilities; and

(2) provides for a transition period in accordance with

subsection (b).

(b) TRANSITION PERIOD.—

(1) IN GENERAL.—The final regulation required under subsection (a) shall provide that, with respect to a State described

in paragraph (3), the State shall be considered to be in compliance with the final regulation required under subsection (a)

so long as, for each State fiscal year during the period described

in paragraph (4), the State reduces payments under a State

medicaid plan payment provision or methodology described in

paragraph (3) (including a payment provision or methodology

described in that paragraph that was approved under a waiver

of such plan), or reduces the actual dollar payment levels

described in paragraph (3)(B), so that the amount of the payments that would otherwise have been made under such provision, methodology, or payment levels by the State for any

State fiscal year during such period is reduced by 15 percent

in the first such State fiscal year, and by an additional 15

percent in each of the next 5 State fiscal years.

(2) REQUIREMENT.—Notwithstanding paragraph (1), the

final regulation required under subsection (a) shall provide

that, for any period (or portion of a period) that occurs on

or after October 1, 2008, medicaid payments made by a State

described in paragraph (3) shall comply with such final regulation.

(3) STATE DESCRIBED.—A State described in this paragraph

is a State with a State medicaid plan payment provision or

methodology (including a payment provision or methodology

approved under a waiver of such plan) which—

(A) was approved, deemed to have been approved, or

was in effect on or before October 1, 1992 (including any

subsequent amendments or successor provisions or methodologies and whether or not a State plan amendment

was made to carry out such provision or methodology after

such date) or under which claims for Federal financial

participation were filed and paid on or before such date;

and

(B) provides for payments that are in excess of the

upper payment limit test established under the final regulation required under subsection (a) (or which would be

noncompliant with such final regulation if the actual dollar

payment levels made under the payment provision or methodology in the State fiscal year which begins during 1999

were continued).

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–577

(4) PERIOD DESCRIBED.—The period described in this paragraph is the period that begins on the first State fiscal year

that begins after September 30, 2002, and ends on September

30, 2008.

SEC. 706. ALASKA FMAP.

Notwithstanding the first sentence of section 1905(b) of the

Social Security Act (42 U.S.C. 1396d(b)), only with respect to each

of fiscal years 2001 through 2005, for purposes of titles XIX and

XXI of the Social Security Act, the State percentage used to determine the Federal medical assistance percentage for Alaska shall

be that percentage which bears the same ratio to 45 percent as

the square of the adjusted per capita income of Alaska (determined

by dividing the State’s 3-year average per capita income by 1.05)

bears to the square of the per capita income of the 50 States.

SEC. 707. ONE-YEAR EXTENSION OF WELFARE-TO-WORK TRANSITION.

(a) IN GENERAL.—Section 1925(f ) (42 U.S.C. 1396r–6(f )) is

amended by striking ‘‘2001’’ and inserting ‘‘2002’’. (b) CONFORMING AMENDMENT.—Section 1902(e)(1)(B) (42 U.S.C.

1396a(e)(1)(B)) is amended by striking ‘‘2001’’ and inserting ‘‘2002’’.

SEC. 708. ADDITIONAL ENTITIES QUALIFIED TO DETERMINE MEDICAID

PRESUMPTIVE ELIGIBILITY FOR LOW-INCOME CHILDREN.

(a) IN GENERAL.—Section 1920A(b)(3)(A)(i) (42 U.S.C. 1396r–

1a(b)(3)(A)(i)) is amended—

(1) by striking ‘‘or (II)’’ and inserting ‘‘, (II)’’; and

(2) by inserting ‘‘eligibility of a child for medical assistance

under the State plan under this title, or eligibility of a child

for child health assistance under the program funded under

title XXI, (III) is an elementary school or secondary school,

as such terms are defined in section 14101 of the Elementary

and Secondary Education Act of 1965 (20 U.S.C. 8801), an

elementary or secondary school operated or supported by the

Bureau of Indian Affairs, a State or tribal child support enforcement agency, an organization that is providing emergency food

and shelter under a grant under the Stewart B. McKinney

Homeless Assistance Act, or a State or tribal office or entity

involved in enrollment in the program under this title, under

part A of title IV, under title XXI, or that determines eligibility

for any assistance or benefits provided under any program

of public or assisted housing that receives Federal funds, including the program under section 8 or any other section of the

United States Housing Act of 1937 (42 U.S.C. 1437 et seq.)

or under the Native American Housing Assistance and SelfDetermination Act of 1996 (25 U.S.C. 4101 et seq.), or (IV)

any other entity the State so deems, as approved by the Secretary’’ before the semicolon.

(b) TECHNICAL AMENDMENTS.—Section 1920A (42 U.S.C. 1396r–

1a) is amended—

(1) in subsection (b)(3)(A)(i), by striking ‘‘42 U.S.C. 9821’’ and inserting ‘‘42 U.S.C. 9831’’;

(2) in subsection (b)(3)(A)(ii), by striking ‘‘paragraph (1)(A)’’

and inserting ‘‘paragraph (2)’’; and

(3) in subsection (c)(2), in the matter preceding subparagraph (A), by striking ‘‘subsection (b)(1)(A)’’ and inserting ‘‘subsection (b)(2)’’.

114 STAT. 2763A–578 PUBLIC LAW 106–554—APPENDIX F

SEC. 709. DEVELOPMENT OF UNIFORM QMB/SLMB APPLICATION FORM.

(a) IN GENERAL.—Section 1905(p) (42 U.S.C. 1396d(p)) is

amended by adding at the end the following new paragraph:

‘‘(5)(A) The Secretary shall develop and distribute to States

a simplified application form for use by individuals (including both

qualified medicare beneficiaries and specified low-income medicare

beneficiaries) in applying for medical assistance for medicare costsharing under this title in the States which elect to use such

form. Such form shall be easily readable by applicants and uniform

nationally.

‘‘(B) In developing such form, the Secretary shall consult with

beneficiary groups and the States.’’.

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall take effect 1 year after the date of the enactment of this

Act, regardless of whether regulations have been promulgated to

carry out such amendment by such date. The Secretary of Health

and Human Services shall develop the uniform application form

under such amendment by not later than 9 months after the date

of the enactment of this Act.

SEC. 710. TECHNICAL CORRECTIONS.

(a) IN GENERAL.—Section 1903(f )(4) (42 U.S.C. 1396b(f )(4)) is

amended—

(1) by inserting ‘‘1902(a)(10)(A)(ii)(XVII),’’ after

‘‘1902(a)(10)(A)(ii)(XVI),’’; and

(2) by inserting ‘‘1902(a)(10)(A)(ii)(XVIII),’’ after

‘‘1902(a)(10)(A)(ii)(XVII),’’.

(b) EFFECTIVE DATES.—(1) The amendment made by subsection

(a)(1) shall be effective as if included in the enactment of section

121 of the Foster Care Independence Act of 1999 (Public Law

106–169).

(2) The amendment made by subsection (a)(2) shall be effective

as if included in the enactment of the Breast and Cervical Cancer

Prevention and Treatment Act of 2000 (Public Law 106–354).

TITLE VIII—STATE CHILDREN’S

HEALTH INSURANCE PROGRAM

SEC. 801. SPECIAL RULE FOR REDISTRIBUTION AND AVAILABILITY

OF UNUSED FISCAL YEAR 1998 AND 1999 SCHIP ALLOTMENTS.

(a) CHANGE IN RULES FOR REDISTRIBUTION AND RETENTION

OF UNUSED SCHIP ALLOTMENTS FOR FISCAL YEARS 1998 AND

1999.—Section 2104 (42 U.S.C. 1397dd) is amended by adding at

the end the following new subsection:

‘‘(g) RULE FOR REDISTRIBUTION AND EXTENDED AVAILABILITY

OF FISCAL YEARS 1998 AND 1999 ALLOTMENTS.—

‘‘(1) AMOUNT REDISTRIBUTED.—

‘‘(A) IN GENERAL.—In the case of a State that expends

all of its allotment under subsection (b) or (c) for fiscal

year 1998 by the end of fiscal year 2000, or for fiscal

year 1999 by the end of fiscal year 2001, the Secretary

shall redistribute to the State under subsection (f ) (from

the fiscal year 1998 or 1999 allotments of other States,

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–579

respectively, as determined by the application of paragraphs (2) and (3) with respect to the respective fiscal

year) the following amount: ‘‘(i) STATE.—In the case of one of the 50 States

or the District of Columbia, with respect to— ‘‘(I) the fiscal year 1998 allotment, the amount

by which the State’s expenditures under this title

in fiscal years 1998, 1999, and 2000 exceed the

State’s allotment for fiscal year 1998 under subsection (b); or ‘‘(II) the fiscal year 1999 allotment, the amount

by which the State’s expenditures under this title

in fiscal years 1999, 2000, and 2001 exceed the

State’s allotment for fiscal year 1999 under subsection (b).

‘‘(ii) TERRITORY.—In the case of a commonwealth

or territory described in subsection (c)(3), an amount

that bears the same ratio to 1.05 percent of the total

amount described in paragraph (2)(B)(i)(I) as the ratio

of the commonwealth’s or territory’s fiscal year 1998

or 1999 allotment under subsection (c) (as the case

may be) bears to the total of all such allotments for

such fiscal year under such subsection.

‘‘(B) EXPENDITURE RULES.—An amount redistributed

to a State under this paragraph with respect to fiscal

year 1998 or 1999—

‘‘(i) shall not be included in the determination of

the State’s allotment for any fiscal year under this

section;

‘‘(ii) notwithstanding subsection (e), shall remain

available for expenditure by the State through the

end of fiscal year 2002; and

‘‘(iii) shall be counted as being expended with

respect to a fiscal year allotment in accordance with

applicable regulations of the Secretary. ‘‘(2) EXTENSION OF AVAILABILITY OF PORTION OF UNEXPENDED FISCAL YEARS 1998 AND 1999 ALLOTMENTS.—

‘‘(A) IN GENERAL.—Notwithstanding subsection (e):

‘‘(i) FISCAL YEAR 1998 ALLOTMENT.—Of the amounts

allotted to a State pursuant to this section for fiscal

year 1998 that were not expended by the State by

the end of fiscal year 2000, the amount specified in

subparagraph (B) for fiscal year 1998 for such State

shall remain available for expenditure by the State

through the end of fiscal year 2002.

‘‘(ii) FISCAL YEAR 1999 ALLOTMENT.—Of the

amounts allotted to a State pursuant to this subsection

for fiscal year 1999 that were not expended by the

State by the end of fiscal year 2001, the amount specified in subparagraph (B) for fiscal year 1999 for such

State shall remain available for expenditure by the

State through the end of fiscal year 2002.

‘‘(B) AMOUNT REMAINING AVAILABLE FOR EXPENDITURE.—The amount specified in this subparagraph for a

State for a fiscal year is equal to—

‘‘(i) the amount by which (I) the total amount

available for redistribution under subsection (f ) from

114 STAT. 2763A–580 PUBLIC LAW 106–554—APPENDIX F

the allotments for that fiscal year, exceeds (II) the

total amounts redistributed under paragraph (1) for

that fiscal year; multiplied by

‘‘(ii) the ratio of the amount of such State’s unexpended allotment for that fiscal year to the total

amount described in clause (i)(I) for that fiscal year.

‘‘(C) USE OF UP TO 10 PERCENT OF RETAINED 1998 ALLOTMENTS FOR OUTREACH ACTIVITIES.—Notwithstanding section 2105(c)(2)(A), with respect to any State described in

subparagraph (A)(i), the State may use up to 10 percent

of the amount specified in subparagraph (B) for fiscal year

1998 for expenditures for outreach activities approved by

the Secretary.

‘‘(3) DETERMINATION OF AMOUNTS.—For purposes of calculating the amounts described in paragraphs (1) and (2) relating to the allotment for fiscal year 1998 or fiscal year 1999,

the Secretary shall use the amounts reported by the States

not later than December 15, 2000, or November 30, 2001,

respectively, on HCFA Form 64 or HCFA Form 21, as approved

by the Secretary.’’.

(b) EFFECTIVE DATE.—The amendments made by this section

shall take effect as if included in the enactment of section 4901

of BBA (111 Stat. 552).

SEC. 802. AUTHORITY TO PAY MEDICAID EXPANSION SCHIP COSTS

FROM TITLE XXI APPROPRIATION.

(a) AUTHORITY TO PAY MEDICAID EXPANSION SCHIP COSTS

FROM TITLE XXI APPROPRIATION.—Section 2105(a) (42 U.S.C.

1397ee(a)) is amended—

(1) by redesignating subparagraphs (A) through (D) of paragraph (2) as clauses (i) through (iv), respectively, and indenting

appropriately;

(2) by redesignating paragraph (1) as subparagraph (C),

and indenting appropriately;

(3) by redesignating paragraph (2) as subparagraph (D),

and indenting appropriately;

(4) by striking ‘‘(a) IN GENERAL.—’’ and the remainder

of the text that precedes subparagraph (C), as so redesignated,

and inserting the following:

‘‘(a) PAYMENTS.—

‘‘(1) IN GENERAL.—Subject to the succeeding provisions of

this section, the Secretary shall pay to each State with a

plan approved under this title, from its allotment under section

2104, an amount for each quarter equal to the enhanced FMAP

(or, in the case of expenditures described in subparagraph

(B), the Federal medical assistance percentage (as defined in

the first sentence of section 1905(b))) of expenditures in the

quarter—

‘‘(A) for child health assistance under the plan for

targeted low-income children in the form of providing medical assistance for which payment is made on the basis

of an enhanced FMAP under the fourth sentence of section

1905(b);

‘‘(B) for the provision of medical assistance on behalf

of a child during a presumptive eligibility period under

section 1920A;’’; and

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–581

(5) by adding after subparagraph (D), as so redesignated,

the following new paragraph:

‘‘(2) ORDER OF PAYMENTS.—Payments under paragraph (1)

from a State’s allotment shall be made in the following order:

‘‘(A) First, for expenditures for items described in paragraph (1)(A).

‘‘(B) Second, for expenditures for items described in

paragraph (1)(B).

‘‘(C) Third, for expenditures for items described in paragraph (1)(C).

‘‘(D) Fourth, for expenditures for items described in

paragraph (1)(D).’’.

(b) ELIMINATION OF REQUIREMENT TO REDUCE TITLE XXI

ALLOTMENT BY MEDICAID EXPANSION SCHIP COSTS.—Section 2104

(42 U.S.C. 1397dd) is amended by striking subsection (d).

(c) AUTHORITY TO TRANSFER TITLE XXI APPROPRIATIONS TO

TITLE XIX APPROPRIATION ACCOUNT AS REIMBURSEMENT FOR

MEDICAID EXPENDITURES FOR MEDICAID EXPANSION SCHIP SERVICES.—Notwithstanding any other provision of law, all amounts

appropriated under title XXI and allotted to a State pursuant

to subsection (b) or (c) of section 2104 of the Social Security Act

(42 U.S.C. 1397dd) for fiscal years 1998 through 2000 (including

any amounts that, but for this provision, would be considered to

have expired) and not expended in providing child health assistance

or related services for which payment may be made pursuant to

subparagraph (C) or (D) of section 2105(a)(1) of such Act (42 U.S.C.

1397ee(a)(1)) (as amended by subsection (a)), shall be available

to reimburse the Grants to States for Medicaid account in an

amount equal to the total payments made to such State under

section 1903(a) of such Act (42 U.S.C. 1396b(a)) for expenditures

in such years for medical assistance described in subparagraphs

(A) and (B) of section 2105(a)(1) of such Act (42 U.S.C. 1397ee(a)(1))

(as so amended).

(d) CONFORMING AMENDMENTS.—

(1) Section 1905(b) (42 U.S.C. 1396d(b)) is amended in

the fourth sentence by striking ‘‘the State’s allotment under

section 2104 (not taking into account reductions under section

2104(d)(2)) for the fiscal year reduced by the amount of any

payments made under section 2105 to the State from such

allotment for such fiscal year’’ and inserting ‘‘the State’s available allotment under section 2104’’.

(2) Section 1905(u)(1)(B) (42 U.S.C. 1396d(u)(1)(B)) is

amended by striking ‘‘and section 2104(d)’’.

(3) Section 2104 (42 U.S.C. 1397dd), as amended by subsection (b), is further amended—

(A) in subsection (b)(1), by striking ‘‘and subsection

(d)’’; and

(B) in subsection (c)(1), by striking ‘‘subject to subsection (d),’’.

(4) Section 2105(c) (42 U.S.C. 1397ee(c)) is amended—

(A) in paragraph (2)(A), by striking all that follows

‘‘Except as provided in this paragraph,’’ and inserting ‘‘the

amount of payment that may be made under subsection

(a) for a fiscal year for expenditures for items described

in paragraph (1)(D) of such subsection shall not exceed

10 percent of the total amount of expenditures for which

114 STAT. 2763A–582 PUBLIC LAW 106–554—APPENDIX F

payment is made under subparagraphs (A), (C), and (D)

of paragraph (1) of such subsection.’’;

(B) in paragraph (2)(B), by striking ‘‘described in subsection (a)(2)’’ and inserting ‘‘described in subsection

(a)(1)(D)’’; and

(C) in paragraph (6)(B), by striking ‘‘Except as otherwise provided by law,’’ and inserting ‘‘Except as provided

in subparagraph (A) or (B) of subsection (a)(1) or any

other provision of law,’’.

(5) Section 2110(a) (42 U.S.C. 1397jj(a)) is amended by

striking ‘‘section 2105(a)(2)(A)’’ and inserting ‘‘section

2105(a)(1)(D)(i)’’.

(e) TECHNICAL AMENDMENT.—Section 2105(d)(2)(B)(ii) (42

U.S.C. 1397ee(d)(2)(B)(ii)) is amended by striking ‘‘enhanced FMAP

under section 1905(u)’’ and inserting ‘‘enhanced FMAP under the

fourth sentence of section 1905(b)’’. (f ) EFFECTIVE DATE.—The amendments made by this section

shall be effective as if included in the enactment of section 4901

of the BBA (111 Stat. 552).

SEC. 803. APPLICATION OF MEDICAID CHILD PRESUMPTIVE ELIGIBILITY PROVISIONS.

Section 2107(e)(1) (42 U.S.C. 1397gg(e)(1)) is amended by adding at the end the following new subparagraph:

‘‘(D) Section 1920A (relating to presumptive eligibility

for children).’’.

TITLE IX—OTHER PROVISIONS

Subtitle A—PACE Program

SEC. 901. EXTENSION OF TRANSITION FOR CURRENT WAIVERS.

Section 4803(d)(2) of BBA is amended—

(1) in subparagraph (A), by striking ‘‘24 months’’ and inserting ‘‘36 months’’;

(2) in subparagraph (A), by striking ‘‘the initial effective

date of regulations described in subsection (a)’’ and inserting

‘‘July 1, 2000’’; and

(3) in subparagraph (B), by striking ‘‘3 years’’ and inserting

‘‘4 years’’.

SEC. 902. CONTINUING OF CERTAIN OPERATING ARRANGEMENTS PERMITTED.

(a) IN GENERAL.—Section 1894(f )(2) (42 U.S.C. 1395eee(f )(2))

is amended by adding at the end the following new subparagraph:

‘‘(C) CONTINUATION OF MODIFICATIONS OR WAIVERS OF

OPERATIONAL REQUIREMENTS UNDER DEMONSTRATION STATUS.—If a PACE program operating under demonstration

authority has contractual or other operating arrangements

which are not otherwise recognized in regulation and which

were in effect on July 1, 2000, the Secretary (in close

consultation with, and with the concurrence of, the State

administering agency) shall permit any such program to

continue such arrangements so long as such arrangements

are found by the Secretary and the State to be reasonably

consistent with the objectives of the PACE program.’’.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–583

(b) CONFORMING AMENDMENT.—Section 1934(f )(2) (42 U.S.C.

1396u–4(f )(2)) is amended by adding at the end the following new

subparagraph:

‘‘(C) CONTINUATION OF MODIFICATIONS OR WAIVERS OF

OPERATIONAL REQUIREMENTS UNDER DEMONSTRATION STATUS.—If a PACE program operating under demonstration

authority has contractual or other operating arrangements

which are not otherwise recognized in regulation and which

were in effect on July 1 2000, the Secretary (in close

consultation with, and with the concurrence of, the State

administering agency) shall permit any such program to

continue such arrangements so long as such arrangements

are found by the Secretary and the State to be reasonably

consistent with the objectives of the PACE program.’’.

(c) EFFECTIVE DATE.—The amendments made by this section

shall be effective as included in the enactment of BBA.

SEC. 903. FLEXIBILITY IN EXERCISING WAIVER AUTHORITY.

In applying sections 1894(f )(2)(B) and 1934(f )(2)(B) of the Social

Security Act (42 U.S.C. 1395eee(f )(2)(B), 1396u–4(f )(2)(B)), the Secretary of Health and Human Services—

(1) shall approve or deny a request for a modification

or a waiver of provisions of the PACE protocol not later than

90 days after the date the Secretary receives the request;

and

(2) may exercise authority to modify or waive such provisions in a manner that responds promptly to the needs of

PACE programs relating to areas of employment and the use

of community-based primary care physicians.

Subtitle B—Outreach to Eligible LowIncome Medicare Beneficiaries

SEC. 911. OUTREACH ON AVAILABILITY OF MEDICARE COST-SHARING

ASSISTANCE TO ELIGIBLE LOW-INCOME MEDICARE

BENEFICIARIES.

(a) OUTREACH.—

(1) IN GENERAL.—Title XI (42 U.S.C. 1301 et seq.) is amended by inserting after section 1143 the following new section:

‘‘OUTREACH EFFORTS TO INCREASE AWARENESS OF THE AVAILABILITY

OF MEDICARE COST-SHARING

‘‘SEC. 1144. (a) OUTREACH.—

‘‘(1) IN GENERAL.—The Commissioner of Social Security

(in this section referred to as the ‘Commissioner’) shall conduct

outreach efforts to—

‘‘(A) identify individuals entitled to benefits under the

medicare program under title XVIII who may be eligible

for medical assistance for payment of the cost of medicare

cost-sharing under the medicaid program pursuant to sections 1902(a)(10)(E) and 1933; and

‘‘(B) notify such individuals of the availability of such

medical assistance under such sections.

114 STAT. 2763A–584 PUBLIC LAW 106–554—APPENDIX F

‘‘(2) CONTENT OF NOTICE.—Any notice furnished under

paragraph (1) shall state that eligibility for medicare costsharing assistance under such sections is conditioned upon— ‘‘(A) the individual providing to the State information

about income and resources (in the case of an individual

residing in a State that imposes an assets test for such

eligibility); and ‘‘(B) meeting the applicable eligibility criteria. ‘‘(b) COORDINATION WITH STATES.— ‘‘(1) IN GENERAL.—In conducting the outreach efforts under

this section, the Commissioner shall— ‘‘(A) furnish the agency of each State responsible for

the administration of the medicaid program and any other

appropriate State agency with information consisting of

the name and address of individuals residing in the State

that the Commissioner determines may be eligible for medical assistance for payment of the cost of medicare costsharing under the medicaid program pursuant to sections

1902(a)(10)(E) and 1933; and ‘‘(B) update any such information not less frequently

than once per year.

‘‘(2) INFORMATION IN PERIODIC UPDATES.—The periodic

updates described in paragraph (1)(B) shall include information

on individuals who are or may be eligible for the medical

assistance described in paragraph (1)(A) because such individuals have experienced reductions in benefits under title II.’’. (2) AMENDMENT TO TITLE XIX.—Section 1905(p) (42 U.S.C.

1396d(p)), as amended by section 710(a), is amended by adding

at the end the following new paragraph:

‘‘(6) For provisions relating to outreach efforts to increase

awareness of the availability of medicare cost-sharing, see section

1144.’’.

(b) GAO REPORT.—The Comptroller General of the United

States shall conduct a study of the impact of section 1144 of the

Social Security Act (as added by subsection (a)(1)) on the enrollment

of individuals for medicare cost-sharing under the medicaid program. Not later than 18 months after the date that the Commissioner of Social Security first conducts outreach under section 1144

of such Act, the Comptroller General shall submit to Congress

a report on such study. The report shall include such recommendations for legislative changes as the Comptroller General deems

appropriate.

(c) EFFECTIVE DATE.—The amendments made by subsection

(a) shall take effect one year after the date of the enactment

of this Act.

Subtitle C—Maternal and Child Health

Block Grant

SEC. 921. INCREASE IN AUTHORIZATION OF APPROPRIATIONS FOR

THE MATERNAL AND CHILD HEALTH SERVICES BLOCK

GRANT.

(a) IN GENERAL.—Section 501(a) (42 U.S.C. 701(a)) is amended

in the matter preceding paragraph (1) by striking ‘‘$705,000,000

for fiscal year 1994’’ and inserting ‘‘$850,000,000 for fiscal year

2001’’.

PUBLIC LAW 106–554—APPENDIX F 114 STAT. 2763A–585

(b) EFFECTIVE DATE.—The amendment made by subsection (a)

takes effect on October 1, 2000.

Subtitle D—Diabetes

SEC. 931. INCREASE IN APPROPRIATIONS FOR SPECIAL DIABETES PROGRAMS FOR TYPE I DIABETES AND INDIANS.

(a) SPECIAL DIABETES PROGRAMS FOR TYPE I DIABETES.—Section 330B(b) of the Public Health Service Act (42 U.S.C. 254c– 2(b)) is amended— (1) by striking ‘‘Notwithstanding’’ and inserting the following: ‘‘(1) TRANSFERRED FUNDS.—Notwithstanding’’; and

(2) by adding at the end the following:

‘‘(2) APPROPRIATIONS.—For the purpose of making grants

under this section, there is appropriated, out of any funds

in the Treasury not otherwise appropriated— ‘‘(A) $70,000,000 for each of fiscal years 2001 and 2002

(which shall be combined with amounts transferred under

paragraph (1) for each such fiscal years); and ‘‘(B) $100,000,000 for fiscal year 2003.’’. (b) SPECIAL DIABETES PROGRAMS FOR INDIANS.—Section 330C(c)

of such Act (42 U.S.C. 254c–3(c)) is amended— (1) by striking ‘‘Notwithstanding’’ and inserting the following: ‘‘(1) TRANSFERRED FUNDS.—Notwithstanding’’; and

(2) by adding at the end the following:

‘‘(2) APPROPRIATIONS.—For the purpose of making grants

under this section, there is appropriated, out of any money

in the Treasury not otherwise appropriated— ‘‘(A) $70,000,000 for each of fiscal years 2001 and 2002

(which shall be combined with amounts transferred under

paragraph (1) for each such fiscal years); and ‘‘(B) $100,000,000 for fiscal year 2003.’’. (c) EXTENSION OF FINAL REPORT ON GRANT PROGRAMS.—Section

4923(b)(2) of BBA is amended by striking ‘‘2002’’ and inserting ‘‘2003’’.

SEC. 932. APPROPRIATIONS FOR RICKY RAY HEMOPHILIA RELIEF

FUND.

Section 101(e) of the Ricky Ray Hemophilia Relief Fund Act

of 1998 (42 U.S.C. 300c–22 note) is amended by adding at the

end the following: ‘‘There is appropriated to the Fund $475,000,000

for fiscal year 2001, to remain available until expended.’’.

Subtitle E—Information on Nurse Staffing

SEC. 941. POSTING OF INFORMATION ON NURSING FACILITY STAFFING.

(a) MEDICARE.—Section 1819(b) (42 U.S.C. 1395i–3(b)) is

amended by adding at the end the following new paragraph:

‘‘(8) INFORMATION ON NURSE STAFFING.—

‘‘(A) IN GENERAL.—A skilled nursing facility shall post

daily for each shift the current number of licensed and

unlicensed nursing staff directly responsible for resident

care in the facility. The information shall be displayed

114 STAT. 2763A–586 PUBLIC LAW 106–554—APPENDIX F

in a uniform manner (as specified by the Secretary) and

in a clearly visible place. ‘‘(B) PUBLICATION OF DATA.—A skilled nursing facility

shall, upon request, make available to the public the nursing staff data described in subparagraph (A).’’. (b) MEDICAID.—Section 1919(b) (42 U.S.C. 1395r(b)) is amended

by adding at the end the following new paragraph: ‘‘(8) INFORMATION ON NURSE STAFFING.— ‘‘(A) IN GENERAL.—A nursing facility shall post daily

for each shift the current number of licensed and unlicensed

nursing staff directly responsible for resident care in the

facility. The information shall be displayed in a uniform

manner (as specified by the Secretary) and in a clearly

visible place. ‘‘(B) PUBLICATION OF DATA.—A nursing facility shall,

upon request, make available to the public the nursing

staff data described in subparagraph (A).’’. (c) EFFECTIVE DATE.—The amendments made by this section

shall take effect on January 1, 2003.

Subtitle F—Adjustment of Multiemployer

Plan Benefits Guaranteed

SEC. 951. MULTIEMPLOYER PLAN BENEFITS GUARANTEED.

(a) IN GENERAL.—Section 4022A(c) of the Employee Retirement

Income Security Act of 1974 (29 U.S.C. 1322a(c)) is amended—

(1) by striking ‘‘$5’’ each place it appears in paragraph

(1) and inserting ‘‘$11’’;

(2) by striking ‘‘$15’’ in paragraph (1)(A)(i) and inserting

‘‘$33’’; and

(3) by striking paragraphs (2), (5), and (6) and by

redesignating paragraphs (3) and (4) as paragraphs (2) and

(3), respectively.

(b) EFFECTIVE DATE.—The amendments made by this section

shall apply to any multiemployer plan that has not received financial assistance (within the meaning of section 4261 of the Employee

Retirement Income Security Act of 1974) within the 1-year period

ending on the date of the enactment of this Act.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–587

APPENDIX G—H.R. 5662

SECTION 1. SHORT TITLE; AMENDMENT OF 1986 CODE.

(a) SHORT TITLE.—This Act may be cited as the ‘‘Community

Renewal Tax Relief Act of 2000’’.

(b) AMENDMENT OF 1986 CODE.—Except as otherwise expressly

provided, whenever in this Act an amendment or repeal is expressed

in terms of an amendment to, or repeal of, a section or other

provision, the reference shall be considered to be made to a section

or other provision of the Internal Revenue Code of 1986.

(c) TABLE OF CONTENTS.—The table of contents for this Act

is as follows:

Sec. 1. Short title; amendment of 1986 Code.

TITLE I—COMMUNITY RENEWAL AND NEW MARKETS

Subtitle A—Tax Incentives for Renewal Communities

Sec. 101. Designation of and tax incentives for renewal communities.

Sec. 102. Work opportunity credit for hiring youth residing in renewal communities.

Subtitle B—Extension and Expansion of Empowerment Zone Incentives

Sec. 111. Authority to designate nine additional empowerment zones.

Sec. 112. Extension of empowerment zone treatment through 2009.

Sec. 113. Twenty percent employment credit for all empowerment zones.

Sec. 114. Increased expensing under section 179.

Sec. 115. Higher limits on tax-exempt empowerment zone facility bonds.

Sec. 116. Nonrecognition of gain on rollover of empowerment zone investments.

Sec. 117. Increased exclusion of gain on sale of empowerment zone stock.

Subtitle C—New Markets Tax Credit

Sec. 121. New markets tax credit.

Subtitle D—Improvements in Low-Income Housing Credit

Sec. 131. Modification of State ceiling on low-income housing credit.

Sec. 132. Modification of criteria for allocating housing credits among projects.

Sec. 133. Additional responsibilities of housing credit agencies.

Sec. 134. Modifications to rules relating to basis of building which is eligible for

credit.

Sec. 135. Other modifications.

Sec. 136. Carryforward rules.

Sec. 137. Effective date.

Subtitle E—Other Community Renewal and New Markets Assistance

PART I—PROVISIONS RELATING TO HOUSING AND SUBSTANCE ABUSE PREVENTION AND

TREATMENT

Sec. 141. Transfer of unoccupied and substandard HUD-held housing to local

governments and community development corporations. Sec. 142. Transfer of HUD assets in revitalization areas.

Sec. 143. Risk-sharing demonstration.

Sec. 144. Prevention and treatment of substance abuse; services provided through

religious organizations.

PART II—ADVISORY COUNCIL ON COMMUNITY RENEWAL

Sec. 151. Short title.

114 STAT. 2763A–588 PUBLIC LAW 106–554—APPENDIX G

Sec. 152. Establishment.

Sec. 153. Duties of Advisory Council.

Sec. 154. Membership.

Sec. 155. Powers of Advisory Council.

Sec. 156. Reports.

Sec. 157. Termination.

Sec. 158. Applicability of Federal Advisory Committee Act.

Sec. 159. Resources.

Sec. 160. Effective date.

Subtitle F—Other Provisions

Sec. 161. Acceleration of phase-in of increase in volume cap on private activity

bonds.

Sec. 162. Modifications to expensing of environmental remediation costs.

Sec. 163. Extension of DC homebuyer tax credit.

Sec. 164. Extension of DC Zone through 2003.

Sec. 165. Extension of enhanced deduction for corporate donations of computer

technology.

Sec. 166. Treatment of Indian tribal governments under Federal Unemployment

Tax Act.

TITLE II—TWO-YEAR EXTENSION OF AVAILABILITY OF MEDICAL SAVINGS

ACCOUNTS

Sec. 201. Two-year extension of availability of medical savings accounts.

Sec. 202. Medical savings accounts renamed as Archer MSAs.

TITLE III—ADMINISTRATIVE AND TECHNICAL PROVISIONS

Subtitle A—Administrative Provisions

Sec. 301. Exemption of certain reporting requirements.

Sec. 302. Extension of deadlines for IRS compliance with certain notice requirements.

Sec. 303. Extension of authority for undercover operations.

Sec. 304. Confidentiality of certain documents relating to closing and similar agreements and to agreements with foreign governments.

Sec. 305. Increase in threshold for Joint Committee reports on refunds and credits.

Sec. 306. Treatment of missing children with respect to certain tax benefits.

Sec. 307. Amendments to statutes referencing yield on 52-week Treasury bills.

Sec. 308. Adjustments for Consumer Price Index error.

Sec. 309. Prevention of duplication of loss through assumption of liabilities giving

rise to a deduction.

Sec. 310. Disclosure of certain information to Congressional Budget Office.

Subtitle B—Technical Corrections

Sec. 311. Amendments related to Ticket to Work and Work Incentives Improvement Act of 1999.

Sec. 312. Amendments related to Tax and Trade Relief Extension Act of 1998.

Sec. 313. Amendments related to Internal Revenue Service Restructuring and

Reform Act of 1998.

Sec. 314. Amendments related to Taxpayer Relief Act of 1997.

Sec. 315. Amendments related to Balanced Budget Act of 1997.

Sec. 316. Amendments related to Small Business Job Protection Act of 1996.

Sec. 317. Amendment related to Revenue Reconciliation Act of 1990.

Sec. 318. Other technical corrections.

Sec. 319. Clerical changes.

TITLE IV—TAX TREATMENT OF SECURITIES FUTURES CONTRACTS

Sec. 401. Tax treatment of securities futures contracts.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–589

TITLE I—COMMUNITY RENEWAL AND

NEW MARKETS

Subtitle A—Tax Incentives for Renewal

Communities

SEC. 101. DESIGNATION OF AND TAX INCENTIVES FOR RENEWAL

COMMUNITIES.

(a) IN GENERAL.—Chapter 1 is amended by adding at the

end the following new subchapter:

‘‘Subchapter X—Renewal Communities

‘‘Part I. Designation.

‘‘Part II. Renewal community capital gain; renewal community business.

‘‘Part III. Additional incentives.

‘‘PART I—DESIGNATION

‘‘Sec. 1400E. Designation of renewal communities.

‘‘SEC. 1400E. DESIGNATION OF RENEWAL COMMUNITIES.

‘‘(a) DESIGNATION.—

‘‘(1) DEFINITIONS.—For purposes of this title, the term

‘renewal community’ means any area—

‘‘(A) which is nominated by 1 or more local governments

and the State or States in which it is located for designation

as a renewal community (hereafter in this section referred

to as a ‘nominated area’), and

‘‘(B) which the Secretary of Housing and Urban

Development designates as a renewal community, after

consultation with—

‘‘(i) the Secretaries of Agriculture, Commerce,

Labor, and the Treasury; the Director of the Office

of Management and Budget, and the Administrator

of the Small Business Administration, and

‘‘(ii) in the case of an area on an Indian reservation,

the Secretary of the Interior.

‘‘(2) NUMBER OF DESIGNATIONS.—

‘‘(A) IN GENERAL.—Not more than 40 nominated areas

may be designated as renewal communities.

‘‘(B) MINIMUM DESIGNATION IN RURAL AREAS.—Of the

areas designated under paragraph (1), at least 12 must

be areas—

‘‘(i) which are within a local government jurisdiction or jurisdictions with a population of less than

50,000,

‘‘(ii) which are outside of a metropolitan statistical

area (within the meaning of section 143(k)(2)(B)), or

‘‘(iii) which are determined by the Secretary of

Housing and Urban Development, after consultation

with the Secretary of Commerce, to be rural areas.

‘‘(3) AREAS DESIGNATED BASED ON DEGREE OF POVERTY,

ETC.—

‘‘(A) IN GENERAL.—Except as otherwise provided in

this section, the nominated areas designated as renewal

114 STAT. 2763A–590 PUBLIC LAW 106–554—APPENDIX G

communities under this subsection shall be those nominated areas with the highest average ranking with respect

to the criteria described in subparagraphs (B), (C), and

(D) of subsection (c)(3). For purposes of the preceding sentence, an area shall be ranked within each such criterion

on the basis of the amount by which the area exceeds

such criterion, with the area which exceeds such criterion

by the greatest amount given the highest ranking.

‘‘(B) EXCEPTION WHERE INADEQUATE COURSE OF ACTION,

ETC.—An area shall not be designated under subparagraph

(A) if the Secretary of Housing and Urban Development

determines that the course of action described in subsection

(d)(2) with respect to such area is inadequate.

‘‘(C) PREFERENCE FOR ENTERPRISE COMMUNITIES AND

EMPOWERMENT ZONES.—With respect to the first 20 designations made under this section, a preference shall be

provided to those nominated areas which are enterprise

communities or empowerment zones (and are otherwise

eligible for designation under this section).

‘‘(4) LIMITATION ON DESIGNATIONS.—

‘‘(A) PUBLICATION OF REGULATIONS.—The Secretary of

Housing and Urban Development shall prescribe by regulation no later than 4 months after the date of the enactment

of this section, after consultation with the officials described

in paragraph (1)(B)—

‘‘(i) the procedures for nominating an area under

paragraph (1)(A),

‘‘(ii) the parameters relating to the size and population characteristics of a renewal community, and

‘‘(iii) the manner in which nominated areas will

be evaluated based on the criteria specified in subsection (d).

‘‘(B) TIME LIMITATIONS.—The Secretary of Housing and

Urban Development may designate nominated areas as

renewal communities only during the period beginning on

the first day of the first month following the month in

which the regulations described in subparagraph (A) are

prescribed and ending on December 31, 2001.

‘‘(C) PROCEDURAL RULES.—The Secretary of Housing

and Urban Development shall not make any designation

of a nominated area as a renewal community under paragraph (2) unless—

‘‘(i) the local governments and the States in which

the nominated area is located have the authority—

‘‘(I) to nominate such area for designation as

a renewal community,

‘‘(II) to make the State and local commitments

described in subsection (d), and

‘‘(III) to provide assurances satisfactory to the

Secretary of Housing and Urban Development that

such commitments will be fulfilled,

‘‘(ii) a nomination regarding such area is submitted

in such a manner and in such form, and contains

such information, as the Secretary of Housing and

Urban Development shall by regulation prescribe, and

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–591

‘‘(iii) the Secretary of Housing and Urban Development determines that any information furnished is

reasonably accurate. ‘‘(5) NOMINATION PROCESS FOR INDIAN RESERVATIONS.—For

purposes of this subchapter, in the case of a nominated area

on an Indian reservation, the reservation governing body (as

determined by the Secretary of the Interior) shall be treated

as being both the State and local governments with respect

to such area.

‘‘(b) PERIOD FOR WHICH DESIGNATION IS IN EFFECT.— ‘‘(1) IN GENERAL.—Any designation of an area as a renewal

community shall remain in effect during the period beginning

on January 1, 2002, and ending on the earliest of— ‘‘(A) December 31, 2009,

‘‘(B) the termination date designated by the State and

local governments in their nomination, or ‘‘(C) the date the Secretary of Housing and Urban

Development revokes such designation.

‘‘(2) REVOCATION OF DESIGNATION.—The Secretary of Housing and Urban Development may revoke the designation under

this section of an area if such Secretary determines that the

local government or the State in which the area is located—

‘‘(A) has modified the boundaries of the area, or

‘‘(B) is not complying substantially with, or fails to

make progress in achieving, the State or local commitments, respectively, described in subsection (d).

‘‘(3) EARLIER TERMINATION OF CERTAIN BENEFITS IF EARLIER

TERMINATION OF DESIGNATION.—If the designation of an area

as a renewal community terminates before December 31, 2009,

the day after the date of such termination shall be substituted

for ‘January 1, 2010’ each place it appears in sections 1400F

and 1400J with respect to such area.

‘‘(c) AREA AND ELIGIBILITY REQUIREMENTS.—

‘‘(1) IN GENERAL.—The Secretary of Housing and Urban

Development may designate a nominated area as a renewal

community under subsection (a) only if the area meets the

requirements of paragraphs (2) and (3) of this subsection.

‘‘(2) AREA REQUIREMENTS.—A nominated area meets the

requirements of this paragraph if—

‘‘(A) the area is within the jurisdiction of one or more

local governments,

‘‘(B) the boundary of the area is continuous, and

‘‘(C) the area—

‘‘(i) has a population of not more than 200,000

and at least—

‘‘(I) 4,000 if any portion of such area (other

than a rural area described in subsection

(a)(2)(B)(i)) is located within a metropolitan statistical area (within the meaning of section

143(k)(2)(B)) which has a population of 50,000 or

greater, or

‘‘(II) 1,000 in any other case, or

‘‘(ii) is entirely within an Indian reservation (as

determined by the Secretary of the Interior).

‘‘(3) ELIGIBILITY REQUIREMENTS.—A nominated area meets

the requirements of this paragraph if the State and the local

governments in which it is located certify in writing (and the

114 STAT. 2763A–592 PUBLIC LAW 106–554—APPENDIX G

Secretary of Housing and Urban Development, after such

review of supporting data as he deems appropriate, accepts

such certification) that—

‘‘(A) the area is one of pervasive poverty, unemployment, and general distress,

‘‘(B) the unemployment rate in the area, as determined

by the most recent available data, was at least 11⁄2 times

the national unemployment rate for the period to which

such data relate,

‘‘(C) the poverty rate for each population census tract

within the nominated area is at least 20 percent, and

‘‘(D) in the case of an urban area, at least 70 percent

of the households living in the area have incomes below

80 percent of the median income of households within

the jurisdiction of the local government (determined in

the same manner as under section 119(b)(2) of the Housing

and Community Development Act of 1974).

‘‘(4) CONSIDERATION OF OTHER FACTORS.—The Secretary

of Housing and Urban Development, in selecting any nominated

area for designation as a renewal community under this

section—

‘‘(A) shall take into account—

‘‘(i) the extent to which such area has a high

incidence of crime, or

‘‘(ii) if such area has census tracts identified in

the May 12, 1998, report of the General Accounting

Office regarding the identification of economically distressed areas, and

‘‘(B) with respect to 1 of the areas to be designated

under subsection (a)(2)(B), may, in lieu of any criteria

described in paragraph (3), take into account the existence

of outmigration from the area.

‘‘(d) REQUIRED STATE AND LOCAL COMMITMENTS.—

‘‘(1) IN GENERAL.—The Secretary of Housing and Urban

Development may designate any nominated area as a renewal

community under subsection (a) only if—

‘‘(A) the local government and the State in which the

area is located agree in writing that, during any period

during which the area is a renewal community, such

governments will follow a specified course of action which

meets the requirements of paragraph (2) and is designed

to reduce the various burdens borne by employers or

employees in such area, and

‘‘(B) the economic growth promotion requirements of

paragraph (3) are met.

‘‘(2) COURSE OF ACTION.—

‘‘(A) IN GENERAL.—A course of action meets the requirements of this paragraph if such course of action is a written

document, signed by a State (or local government) and

neighborhood organizations, which evidences a partnership

between such State or government and community-based

organizations and which commits each signatory to specific

and measurable goals, actions, and timetables. Such course

of action shall include at least 4 of the following:

‘‘(i) A reduction of tax rates or fees applying within

the renewal community.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–593

‘‘(ii) An increase in the level of efficiency of local

services within the renewal community.

‘‘(iii) Crime reduction strategies, such as crime

prevention (including the provision of crime prevention

services by nongovernmental entities).

‘‘(iv) Actions to reduce, remove, simplify, or streamline governmental requirements applying within the

renewal community.

‘‘(v) Involvement in the program by private entities, organizations, neighborhood organizations, and

community groups, particularly those in the renewal

community, including a commitment from such private

entities to provide jobs and job training for, and technical, financial, or other assistance to, employers,

employees, and residents from the renewal community.

‘‘(vi) The gift (or sale at below fair market value)

of surplus real property (such as land, homes, and

commercial or industrial structures) in the renewal

community to neighborhood organizations, community

development corporations, or private companies.

‘‘(B) RECOGNITION OF PAST EFFORTS.—For purposes of

this section, in evaluating the course of action agreed to

by any State or local government, the Secretary of Housing

and Urban Development shall take into account the past

efforts of such State or local government in reducing the

various burdens borne by employers and employees in the

area involved.

‘‘(3) ECONOMIC GROWTH PROMOTION REQUIREMENTS.—The

economic growth promotion requirements of this paragraph

are met with respect to a nominated area if the local government and the State in which such area is located certify in

writing that such government and State (respectively) have

repealed or reduced, will not enforce, or will reduce within

the nominated area at least 4 of the following:

‘‘(A) Licensing requirements for occupations that do

not ordinarily require a professional degree.

‘‘(B) Zoning restrictions on home-based businesses

which do not create a public nuisance.

‘‘(C) Permit requirements for street vendors who do

not create a public nuisance.

‘‘(D) Zoning or other restrictions that impede the formation of schools or child care centers.

‘‘(E) Franchises or other restrictions on competition

for businesses providing public services, including taxicabs,

jitneys, cable television, or trash hauling.

This paragraph shall not apply to the extent that such regulation of businesses and occupations is necessary for and welltailored to the protection of health and safety.

‘‘(e) COORDINATION WITH TREATMENT OF EMPOWERMENT ZONES

AND ENTERPRISE COMMUNITIES.—For purposes of this title, the designation under section 1391 of any area as an empowerment zone

or enterprise community shall cease to be in effect as of the date

that the designation of any portion of such area as a renewal

community takes effect.

‘‘(f ) DEFINITIONS AND SPECIAL RULES.—For purposes of this

subchapter—

114 STAT. 2763A–594 PUBLIC LAW 106–554—APPENDIX G

‘‘(1) GOVERNMENTS.—If more than one government seeks

to nominate an area as a renewal community, any reference

to, or requirement of, this section shall apply to all such governments. ‘‘(2) LOCAL GOVERNMENT.—The term ‘local government’ means—

‘‘(A) any county, city, town, township, parish, village,

or other general purpose political subdivision of a State,

and ‘‘(B) any combination of political subdivisions described

in subparagraph (A) recognized by the Secretary of Housing

and Urban Development.

‘‘(3) APPLICATION OF RULES RELATING TO CENSUS TRACTS.— The rules of section 1392(b)(4) shall apply. ‘‘(4) CENSUS DATA.—Population and poverty rate shall be

determined by using 1990 census data.

‘‘PART II—RENEWAL COMMUNITY CAPITAL

GAIN; RENEWAL COMMUNITY BUSINESS

‘‘Sec. 1400F. Renewal community capital gain.

‘‘Sec. 1400G. Renewal community business defined.

‘‘SEC. 1400F. RENEWAL COMMUNITY CAPITAL GAIN.

‘‘(a) GENERAL RULE.—Gross income does not include any qualified capital gain from the sale or exchange of a qualified community

asset held for more than 5 years. ‘‘(b) QUALIFIED COMMUNITY ASSET.—For purposes of this

section—

‘‘(1) IN GENERAL.—The term ‘qualified community asset’ means—

‘‘(A) any qualified community stock,

‘‘(B) any qualified community partnership interest, and

‘‘(C) any qualified community business property. ‘‘(2) QUALIFIED COMMUNITY STOCK.— ‘‘(A) IN GENERAL.—Except as provided in subparagraph

(B), the term ‘qualified community stock’ means any stock

in a domestic corporation if— ‘‘(i) such stock is acquired by the taxpayer after

December 31, 2001, and before January 1, 2010, at

its original issue (directly or through an underwriter)

from the corporation solely in exchange for cash, ‘‘(ii) as of the time such stock was issued, such

corporation was a renewal community business (or,

in the case of a new corporation, such corporation

was being organized for purposes of being a renewal

community business), and ‘‘(iii) during substantially all of the taxpayer’s holding period for such stock, such corporation qualified

as a renewal community business.

‘‘(B) REDEMPTIONS.—A rule similar to the rule of section 1202(c)(3) shall apply for purposes of this paragraph.

‘‘(3) QUALIFIED COMMUNITY PARTNERSHIP INTEREST.—The

term ‘qualified community partnership interest’ means any capital or profits interest in a domestic partnership if— ‘‘(A) such interest is acquired by the taxpayer after

December 31, 2001, and before January 1, 2010, from the

partnership solely in exchange for cash,

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–595

‘‘(B) as of the time such interest was acquired, such

partnership was a renewal community business (or, in

the case of a new partnership, such partnership was being

organized for purposes of being a renewal community business), and

‘‘(C) during substantially all of the taxpayer’s holding

period for such interest, such partnership qualified as a

renewal community business.

A rule similar to the rule of paragraph (2)(B) shall apply

for purposes of this paragraph.

‘‘(4) QUALIFIED COMMUNITY BUSINESS PROPERTY.—

‘‘(A) IN GENERAL.—The term ‘qualified community business property’ means tangible property if—

‘‘(i) such property was acquired by the taxpayer

by purchase (as defined in section 179(d)(2)) after

December 31, 2001, and before January 1, 2010,

‘‘(ii) the original use of such property in the

renewal community commences with the taxpayer, and

‘‘(iii) during substantially all of the taxpayer’s holding period for such property, substantially all of the

use of such property was in a renewal community

business of the taxpayer.

‘‘(B) SPECIAL RULE FOR SUBSTANTIAL IMPROVEMENTS.—

The requirements of clauses (i) and (ii) of subparagraph

(A) shall be treated as satisfied with respect to—

‘‘(i) property which is substantially improved by

the taxpayer before January 1, 2010, and

‘‘(ii) any land on which such property is located.

The determination of whether a property is substantially

improved shall be made under clause (ii) of section

1400B(b)(4)(B), except that ‘December 31, 2001’ shall be

substituted for ‘December 31, 1997’ in such clause.

‘‘(c) QUALIFIED CAPITAL GAIN.—For purposes of this section—

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

subsection, the term ‘qualified capital gain’ means any gain

recognized on the sale or exchange of—

‘‘(A) a capital asset, or

‘‘(B) property used in the trade or business (as defined

in section 1231(b)).

‘‘(2) GAIN BEFORE 2002 OR AFTER 2014 NOT QUALIFIED.—

The term ‘qualified capital gain’ shall not include any gain

attributable to periods before January 1, 2002, or after December 31, 2014.

‘‘(3) CERTAIN RULES TO APPLY.—Rules similar to the rules

of paragraphs (3), (4), and (5) of section 1400B(e) shall apply

for purposes of this subsection.

‘‘(d) CERTAIN RULES TO APPLY.—For purposes of this section,

rules similar to the rules of paragraphs (5), (6), and (7) of subsection

(b), and subsections (f ) and (g), of section 1400B shall apply; except

that for such purposes section 1400B(g)(2) shall be applied by

substituting ‘January 1, 2002’ for ‘January 1, 1998’ and ‘December

31, 2014’ for ‘December 31, 2008’.

‘‘(e) REGULATIONS.—The Secretary shall prescribe such regulations as may be appropriate to carry out the purposes of this

section, including regulations to prevent the abuse of the purposes

of this section.

114 STAT. 2763A–596 PUBLIC LAW 106–554—APPENDIX G

‘‘SEC. 1400G. RENEWAL COMMUNITY BUSINESS DEFINED.

‘‘For purposes of this subchapter, the term ‘renewal community

business’ means any entity or proprietorship which would be a

qualified business entity or qualified proprietorship under section

1397C if references to renewal communities were substituted for

references to empowerment zones in such section.

‘‘PART III—ADDITIONAL INCENTIVES

‘‘Sec. 1400H. Renewal community employment credit.

‘‘Sec. 1400I. Commercial revitalization deduction.

‘‘Sec. 1400J. Increase in expensing under section 179.

‘‘SEC. 1400H. RENEWAL COMMUNITY EMPLOYMENT CREDIT.

‘‘(a) IN GENERAL.—Subject to the modification in subsection

(b), a renewal community shall be treated as an empowerment

zone for purposes of section 1396 with respect to wages paid or

incurred after December 31, 2001. ‘‘(b) MODIFICATION.—In applying section 1396 with respect to

renewal communities—

‘‘(1) the applicable percentage shall be 15 percent, and

‘‘(2) subsection (c) thereof shall be applied by substituting

‘$10,000’ for ‘$15,000’ each place it appears.

‘‘SEC. 1400I. COMMERCIAL REVITALIZATION DEDUCTION.

‘‘(a) GENERAL RULE.—At the election of the taxpayer, either—

‘‘(1) one-half of any qualified revitalization expenditures

chargeable to capital account with respect to any qualified

revitalization building shall be allowable as a deduction for

the taxable year in which the building is placed in service,

or

‘‘(2) a deduction for all such expenditures shall be allowable

ratably over the 120-month period beginning with the month

in which the building is placed in service.

‘‘(b) QUALIFIED REVITALIZATION BUILDINGS AND EXPENDITURES.—For purposes of this section—

‘‘(1) QUALIFIED REVITALIZATION BUILDING.—The term ‘qualified revitalization building’ means any building (and its structural components) if—

‘‘(A) the building is placed in service by the taxpayer

in a renewal community and the original use of the building

begins with the taxpayer, or

‘‘(B) in the case of such building not described in

subparagraph (A), such building—

‘‘(i) is substantially rehabilitated (within the meaning of section 47(c)(1)(C)) by the taxpayer, and

‘‘(ii) is placed in service by the taxpayer after the

rehabilitation in a renewal community.

‘‘(2) QUALIFIED REVITALIZATION EXPENDITURE.—

‘‘(A) IN GENERAL.—The term ‘qualified revitalization

expenditure’ means any amount properly chargeable to capital account for property for which depreciation is allowable

under section 168 (without regard to this section) and

which is—

‘‘(i) nonresidential real property (as defined in section 168(e)), or

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–597

‘‘(ii) section 1250 property (as defined in section

1250(c)) which is functionally related and subordinate

to property described in clause (i).

‘‘(B) CERTAIN EXPENDITURES NOT INCLUDED.—

‘‘(i) ACQUISITION COST.—In the case of a building

described in paragraph (1)(B), the cost of acquiring

the building or interest therein shall be treated as

a qualified revitalization expenditure only to the extent

that such cost does not exceed 30 percent of the aggregate qualified revitalization expenditures (determined

without regard to such cost) with respect to such building.

‘‘(ii) CREDITS.—The term ‘qualified revitalization

expenditure’ does not include any expenditure which

the taxpayer may take into account in computing any

credit allowable under this title unless the taxpayer

elects to take the expenditure into account only for

purposes of this section.

‘‘(c) DOLLAR LIMITATION.—The aggregate amount which may

be treated as qualified revitalization expenditures with respect to

any qualified revitalization building shall not exceed the lesser

of—

‘‘(1) $10,000,000, or

‘‘(2) the commercial revitalization expenditure amount allocated to such building under this section by the commercial

revitalization agency for the State in which the building is

located.

‘‘(d) COMMERCIAL REVITALIZATION EXPENDITURE AMOUNT.—

‘‘(1) IN GENERAL.—The aggregate commercial revitalization

expenditure amount which a commercial revitalization agency

may allocate for any calendar year is the amount of the State

commercial revitalization expenditure ceiling determined under

this paragraph for such calendar year for such agency.

‘‘(2) STATE COMMERCIAL REVITALIZATION EXPENDITURE CEILING.—The State commercial revitalization expenditure ceiling

applicable to any State—

‘‘(A) for each calendar year after 2001 and before 2010

is $12,000,000 for each renewal community in the State,

and

‘‘(B) for each calendar year thereafter is zero.

‘‘(3) COMMERCIAL REVITALIZATION AGENCY.—For purposes

of this section, the term ‘commercial revitalization agency’

means any agency authorized by a State to carry out this

section.

‘‘(4) TIME AND MANNER OF ALLOCATIONS.—Allocations under

this section shall be made at the same time and in the same

manner as under paragraphs (1) and (7) of section 42(h).

‘‘(e) RESPONSIBILITIES OF COMMERCIAL REVITALIZATION AGENCIES.—

‘‘(1) PLANS FOR ALLOCATION.—Notwithstanding any other

provision of this section, the commercial revitalization expenditure amount with respect to any building shall be zero unless—

‘‘(A) such amount was allocated pursuant to a qualified

allocation plan of the commercial revitalization agency

which is approved (in accordance with rules similar to

the rules of section 147(f )(2) (other than subparagraph

114 STAT. 2763A–598 PUBLIC LAW 106–554—APPENDIX G

(B)(ii) thereof )) by the governmental unit of which such

agency is a part, and

‘‘(B) such agency notifies the chief executive officer

(or its equivalent) of the local jurisdiction within which

the building is located of such allocation and provides such

individual a reasonable opportunity to comment on the

allocation.

‘‘(2) QUALIFIED ALLOCATION PLAN.—For purposes of this

subsection, the term ‘qualified allocation plan’ means any

plan—

‘‘(A) which sets forth selection criteria to be used to

determine priorities of the commercial revitalization agency

which are appropriate to local conditions,

‘‘(B) which considers—

‘‘(i) the degree to which a project contributes to

the implementation of a strategic plan that is devised

for a renewal community through a citizen participation process,

‘‘(ii) the amount of any increase in permanent,

full-time employment by reason of any project, and

‘‘(iii) the active involvement of residents and nonprofit groups within the renewal community, and

‘‘(C) which provides a procedure that the agency (or

its agent) will follow in monitoring compliance with this

section.

‘‘(f ) SPECIAL RULES.—

‘‘(1) DEDUCTION IN LIEU OF DEPRECIATION.—The deduction

provided by this section for qualified revitalization expenditures

shall—

‘‘(A) with respect to the deduction determined under

subsection (a)(1), be in lieu of any depreciation deduction

otherwise allowable on account of one-half of such expenditures, and

‘‘(B) with respect to the deduction determined under

subsection (a)(2), be in lieu of any depreciation deduction

otherwise allowable on account of all of such expenditures.

‘‘(2) BASIS ADJUSTMENT, ETC.—For purposes of sections 1016

and 1250, the deduction under this section shall be treated

in the same manner as a depreciation deduction. For purposes

of section 1250(b)(5), the straight line method of adjustment

shall be determined without regard to this section.

‘‘(3) SUBSTANTIAL REHABILITATIONS TREATED AS SEPARATE

BUILDINGS.—A substantial rehabilitation (within the meaning

of section 47(c)(1)(C)) of a building shall be treated as a separate

building for purposes of subsection (a).

‘‘(4) CLARIFICATION OF ALLOWANCE OF DEDUCTION UNDER

MINIMUM TAX.—Notwithstanding section 56(a)(1), the deduction

under this section shall be allowed in determining alternative

minimum taxable income under section 55.

‘‘(g) TERMINATION.—This section shall not apply to any building

placed in service after December 31, 2009.

‘‘SEC. 1400J. INCREASE IN EXPENSING UNDER SECTION 179.

‘‘(a) IN GENERAL.—For purposes of section 1397A—

‘‘(1) a renewal community shall be treated as an empowerment zone,

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–599

‘‘(2) a renewal community business shall be treated as

an enterprise zone business, and ‘‘(3) qualified renewal property shall be treated as qualified

zone property.

‘‘(b) QUALIFIED RENEWAL PROPERTY.—For purposes of this

section—

‘‘(1) IN GENERAL.—The term ‘qualified renewal property’ means any property to which section 168 applies (or would

apply but for section 179) if— ‘‘(A) such property was acquired by the taxpayer by

purchase (as defined in section 179(d)(2)) after December

31, 2001, and before January 1, 2010, and ‘‘(B) such property would be qualified zone property

(as defined in section 1397D) if references to renewal

communities were substituted for references to empowerment zones in section 1397D.

‘‘(2) CERTAIN RULES TO APPLY.—The rules of subsections

(a)(2) and (b) of section 1397D shall apply for purposes of

this section.’’.

(b) EXCEPTION FOR COMMERCIAL REVITALIZATION DEDUCTION

FROM PASSIVE LOSS RULES.—

(1) Paragraph (3) of section 469(i) is amended by

redesignating subparagraphs (C), (D), and (E) as subparagraphs

(D), (E), and (F), respectively, and by inserting after subparagraph (B) the following new subparagraph:

‘‘(C) EXCEPTION FOR COMMERCIAL REVITALIZATION

DEDUCTION.—Subparagraph (A) shall not apply to any portion of the passive activity loss for any taxable year which

is attributable to the commercial revitalization deduction

under section 1400I.’’.

(2) Subparagraph (E) of section 469(i)(3), as redesignated

by subparagraph (A), is amended to read as follows:

‘‘(E) ORDERING RULES TO REFLECT EXCEPTIONS AND

SEPARATE PHASE-OUTS.—If subparagraph (B), (C), or (D)

applies for a taxable year, paragraph (1) shall be applied— ‘‘(i) first to the portion of the passive activity loss

to which subparagraph (C) does not apply,

‘‘(ii) second to the portion of the passive activity

credit to which subparagraph (B) or (D) does not apply,

‘‘(iii) third to the portion of such credit to which

subparagraph (B) applies,

‘‘(iv) fourth to the portion of such loss to which

subparagraph (C) applies, and

‘‘(v) then to the portion of such credit to which

subparagraph (D) applies.’’.

(3)(A) Subparagraph (B) of section 469(i)(6) is amended

by striking ‘‘or’’ at the end of clause (i), by striking the period

at the end of clause (ii) and inserting ‘‘, or’’, and by adding

at the end the following new clause:

‘‘(iii) any deduction under section 1400I (relating

to commercial revitalization deduction).’’.

(B) The heading for such subparagraph (B) is amended

by striking ‘‘OR REHABILITATION CREDIT’’ and inserting ‘‘,

REHABILITATION CREDIT, OR COMMERCIAL REVITALIZATION

DEDUCTION’’. (c) AUDIT AND REPORT.—Not later than January 31 of 2004,

2007, and 2010, the Comptroller General of the United States

114 STAT. 2763A–600 PUBLIC LAW 106–554—APPENDIX G

shall, pursuant to an audit of the renewal community program

established under section 1400E of the Internal Revenue Code

of 1986 (as added by subsection (a)) and the empowerment zone

and enterprise community program under subchapter U of chapter

1 of such Code, report to Congress on such program and its effect

on poverty, unemployment, and economic growth within the designated renewal communities, empowerment zones, and enterprise

communities.

(d) CLERICAL AMENDMENT.—The table of subchapters for chapter 1 is amended by adding at the end the following new item:

‘‘Subchapter X. Renewal Communities.’’.

SEC. 102. WORK OPPORTUNITY CREDIT FOR HIRING YOUTH RESIDING

IN RENEWAL COMMUNITIES.

(a) HIGH-RISK YOUTH.—Subparagraphs (A)(ii) and (B) of section

51(d)(5) are each amended by striking ‘‘empowerment zone or enterprise community’’ and inserting ‘‘empowerment zone, enterprise

community, or renewal community’’.

(b) QUALIFIED SUMMER YOUTH EMPLOYEE.—Clause (iv) of section 51(d)(7)(A) is amended by striking ‘‘empowerment zone or

enterprise community’’ and inserting ‘‘empowerment zone, enterprise community, or renewal community’’.

(c) HEADINGS.—Paragraphs (5)(B) and (7)(C) of section 51(d)

are each amended by inserting ‘‘OR COMMUNITY’’ in the heading

after ‘‘ZONE’’.

(d) EFFECTIVE DATE.—The amendments made by this section

shall apply to individuals who begin work for the employer after

December 31, 2001.

Subtitle B—Extension and Expansion of

Empowerment Zone Incentives

SEC. 111. AUTHORITY TO DESIGNATE 9 ADDITIONAL EMPOWERMENT

ZONES.

Section 1391 is amended by adding at the end the following

new subsection:

‘‘(h) ADDITIONAL DESIGNATIONS PERMITTED.—

‘‘(1) IN GENERAL.—In addition to the areas designated under

subsections (a) and (g), the appropriate Secretaries may designate in the aggregate an additional 9 nominated areas as

empowerment zones under this section, subject to the availability of eligible nominated areas. Of that number, not more

than seven may be designated in urban areas and not more

than 2 may be designated in rural areas.

‘‘(2) PERIOD DESIGNATIONS MAY BE MADE AND TAKE

EFFECT.—A designation may be made under this subsection

after the date of the enactment of this subsection and before

January 1, 2002. Subject to subparagraphs (B) and (C) of subsection (d)(1), such designations shall remain in effect during

the period beginning on January 1, 2002, and ending on December 31, 2009.

‘‘(3) MODIFICATIONS TO ELIGIBILITY CRITERIA, ETC.—The

rules of subsection (g)(3) shall apply to designations under

this subsection.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–601

‘‘(4) EMPOWERMENT ZONES WHICH BECOME RENEWAL

COMMUNITIES.—The number of areas which may be designated

as empowerment zones under this subsection shall be increased

by 1 for each area which ceases to be an empowerment zone

by reason of section 1400E(e). Each additional area designated

by reason of the preceding sentence shall have the same urban

or rural character as the area it is replacing.’’.

SEC. 112. EXTENSION OF EMPOWERMENT ZONE TREATMENT THROUGH

2009.

Subparagraph (A) of section 1391(d)(1) (relating to period for

which designation is in effect) is amended to read as follows: ‘‘(A)(i) in the case of an empowerment zone, December

31, 2009, or ‘‘(ii) in the case of an enterprise community, the close

of the 10th calendar year beginning on or after such date

of designation,’’.

SEC. 113. 20 PERCENT EMPLOYMENT CREDIT FOR ALL EMPOWERMENT

ZONES.

(a) 20 PERCENT CREDIT.—Subsection (b) of section 1396 (relating to empowerment zone employment credit) is amended to read

as follows:

‘‘(b) APPLICABLE PERCENTAGE.—For purposes of this section,

the applicable percentage is 20 percent.’’.

(b) ALL EMPOWERMENT ZONES ELIGIBLE FOR CREDIT.—Section

1396 is amended by striking subsection (e).

(c) CONFORMING AMENDMENT.—Subsection (d) of section 1400

is amended to read as follows:

‘‘(d) SPECIAL RULE FOR APPLICATION OF EMPLOYMENT CREDIT.—

With respect to the DC Zone, section 1396(d)(1)(B) (relating to

empowerment zone employment credit) shall be applied by

substituting ‘the District of Columbia’ for ‘such empowerment

zone’.’’.

(d) EFFECTIVE DATE.—The amendments made by this section

shall apply to wages paid or incurred after December 31, 2001.

SEC. 114. INCREASED EXPENSING UNDER SECTION 179.

(a) IN GENERAL.—Subparagraph (A) of section 1397A(a)(1) is

amended by striking ‘‘$20,000’’ and inserting ‘‘$35,000’’.

(b) EXPENSING FOR PROPERTY USED IN DEVELOPABLE SITES.—

Section 1397A is amended by striking subsection (c).

(c) EFFECTIVE DATE.—The amendments made by this section

shall apply to taxable years beginning after December 31, 2001.

SEC. 115. HIGHER LIMITS ON TAX-EXEMPT EMPOWERMENT ZONE

FACILITY BONDS.

(a) IN GENERAL.—Paragraph (3) of section 1394(f ) (relating

to bonds for empowerment zones designated under section 1391(g))

is amended to read as follows:

‘‘(3) EMPOWERMENT ZONE FACILITY BOND.—For purposes

of this subsection, the term ‘empowerment zone facility bond’ means any bond which would be described in subsection (a)

if—

‘‘(A) in the case of obligations issued before January

1, 2002, only empowerment zones designated under section

1391(g) were taken into account under sections 1397C and

1397D, and

114 STAT. 2763A–602 PUBLIC LAW 106–554—APPENDIX G

‘‘(B) in the case of obligations issued after December

31, 2001, all empowerment zones (other than the District

of Columbia Enterprise Zone) were taken into account

under sections 1397C and 1397D.’’.

(b) EFFECTIVE DATE.—The amendments made by this section

shall apply to obligations issued after December 31, 2001.

SEC. 116. NONRECOGNITION OF GAIN ON ROLLOVER OF EMPOWERMENT ZONE INVESTMENTS.

(a) IN GENERAL.—Part III of subchapter U of chapter 1 is

amended—

(1) by redesignating subpart C as subpart D,

(2) by redesignating sections 1397B and 1397C as sections

1397C and 1397D, respectively, and

(3) by inserting after subpart B the following new subpart:

‘‘Subpart C—Nonrecognition of Gain on Rollover

of Empowerment Zone Investments

‘‘Sec. 1397B. Nonrecognition of gain on rollover of empowerment zone investments.

‘‘SEC. 1397B. NONRECOGNITION OF GAIN ON ROLLOVER OF EMPOWERMENT ZONE INVESTMENTS.

‘‘(a) NONRECOGNITION OF GAIN.—In the case of any sale of

a qualified empowerment zone asset held by the taxpayer for more

than 1 year and with respect to which such taxpayer elects the

application of this section, gain from such sale shall be recognized

only to the extent that the amount realized on such sale exceeds—

‘‘(1) the cost of any qualified empowerment zone asset

(with respect to the same zone as the asset sold) purchased

by the taxpayer during the 60-day period beginning on the

date of such sale, reduced by

‘‘(2) any portion of such cost previously taken into account

under this section.

‘‘(b) DEFINITIONS AND SPECIAL RULES.—For purposes of this

section—

‘‘(1) QUALIFIED EMPOWERMENT ZONE ASSET.—

‘‘(A) IN GENERAL.—The term ‘qualified empowerment

zone asset’ means any property which would be a qualified

community asset (as defined in section 1400F) if in section

1400F—

‘‘(i) references to empowerment zones were substituted for references to renewal communities,

‘‘(ii) references to enterprise zone businesses (as

defined in section 1397C) were substituted for references to renewal community businesses, and

‘‘(iii) the date of the enactment of this paragraph

were substituted for ‘December 31, 2001’ each place

it appears.

‘‘(B) TREATMENT OF DC ZONE.—The District of Columbia

Enterprise Zone shall not be treated as an empowerment

zone for purposes of this section.

‘‘(2) CERTAIN GAIN NOT ELIGIBLE FOR ROLLOVER.—This section shall not apply to—

‘‘(A) any gain which is treated as ordinary income

for purposes of this subtitle, and

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–603

‘‘(B) any gain which is attributable to real property,

or an intangible asset, which is not an integral part of

an enterprise zone business.

‘‘(3) PURCHASE.—A taxpayer shall be treated as having

purchased any property if, but for paragraph (4), the unadjusted

basis of such property in the hands of the taxpayer would

be its cost (within the meaning of section 1012).

‘‘(4) BASIS ADJUSTMENTS.—If gain from any sale is not

recognized by reason of subsection (a), such gain shall be

applied to reduce (in the order acquired) the basis for determining gain or loss of any qualified empowerment zone asset which

is purchased by the taxpayer during the 60-day period described

in subsection (a). This paragraph shall not apply for purposes

of section 1202.

‘‘(5) HOLDING PERIOD.—For purposes of determining

whether the nonrecognition of gain under subsection (a) applies

to any qualified empowerment zone asset which is sold—

‘‘(A) the taxpayer’s holding period for such asset and

the asset referred to in subsection (a)(1) shall be determined

without regard to section 1223, and

‘‘(B) only the first year of the taxpayer’s holding period

for the asset referred to in subsection (a)(1) shall be taken

into account for purposes of paragraphs (2)(A)(iii), (3)(C),

and (4)(A)(iii) of section 1400F(b).’’.

(b) CONFORMING AMENDMENTS.—

(1) Paragraph (23) of section 1016(a) is amended—

(A) by striking ‘‘or 1045’’ and inserting ‘‘1045, or

1397B’’, and

(B) by striking ‘‘or 1045(b)(4)’’ and inserting ‘‘1045(b)(4),

or 1397B(b)(4)’’.

(2) Paragraph (15) of section 1223 is amended to read

as follows:

‘‘(15) Except for purposes of sections 1202(a)(2),

1202(c)(2)(A), 1400B(b), and 1400F(b), in determining the period

for which the taxpayer has held property the acquisition of

which resulted under section 1045 or 1397B in the nonrecognition of any part of the gain realized on the sale of other

property, there shall be included the period for which such

other property has been held as of the date of such sale.’’.

(3) Paragraph (2) of section 1394(b) is amended—

(A) by striking ‘‘section 1397C’’ and inserting ‘‘section

1397D’’, and

(B) by striking ‘‘section 1397C(a)(2)’’ and inserting ‘‘section 1397D(a)(2)’’.

(4) Paragraph (3) of section 1394(b) is amended—

(A) by striking ‘‘section 1397B’’ each place it appears

and inserting ‘‘section 1397C’’, and

(B) by striking ‘‘section 1397B(d)’’ and inserting ‘‘section 1397C(d)’’.

(5) Sections 1400(e) and 1400B(c) are each amended by

striking ‘‘section 1397B’’ each place it appears and inserting

‘‘section 1397C’’.

114 STAT. 2763A–604 PUBLIC LAW 106–554—APPENDIX G

(6) The table of subparts for part III of subchapter U

of chapter 1 is amended by striking the last item and inserting

the following new items:

‘‘Subpart C. Nonrecognition of gain on rollover of empowerment zone investments.

‘‘Subpart D. General provisions.’’.

(7) The table of sections for subpart D of such part III

is amended to read as follows:

‘‘Sec. 1397C. Enterprise zone business defined.

‘‘Sec. 1397D. Qualified zone property defined.’’.

(c) EFFECTIVE DATE.—The amendments made by this section

shall apply to qualified empowerment zone assets acquired after

the date of the enactment of this Act.

SEC. 117. INCREASED EXCLUSION OF GAIN ON SALE OF EMPOWERMENT ZONE STOCK.

(a) IN GENERAL.—Subsection (a) of section 1202 is amended

to read as follows:

‘‘(a) EXCLUSION.—

‘‘(1) IN GENERAL.—In the case of a taxpayer other than

a corporation, gross income shall not include 50 percent of

any gain from the sale or exchange of qualified small business

stock held for more than 5 years.

‘‘(2) EMPOWERMENT ZONE BUSINESSES.—

‘‘(A) IN GENERAL.—In the case of qualified small business stock acquired after the date of the enactment of

this paragraph in a corporation which is a qualified business entity (as defined in section 1397C(b)) during substantially all of the taxpayer’s holding period for such stock,

paragraph (1) shall be applied by substituting ‘60 percent’

for ‘50 percent’.

‘‘(B) CERTAIN RULES TO APPLY.—Rules similar to the

rules of paragraphs (5) and (7) of section 1400B(b) shall

apply for purposes of this paragraph.

‘‘(C) GAIN AFTER 2014 NOT QUALIFIED.—Subparagraph

(A) shall not apply to gain attributable to periods after

December 31, 2014.

‘‘(D) TREATMENT OF DC ZONE.—The District of Columbia Enterprise Zone shall not be treated as an empowerment zone for purposes of this paragraph.’’.

(b) CONFORMING AMENDMENTS.—

(1) Paragraph (8) of section 1(h) is amended by striking

‘‘means’’ and all that follows and inserting ‘‘means the excess

of—

‘‘(A) the gain which would be excluded from gross

income under section 1202 but for the percentage limitation

in section 1202(a), over

‘‘(B) the gain excluded from gross income under section

1202.’’.

(2) The section heading for section 1202 is amended by

striking ‘‘50-PERCENT’’ and inserting ‘‘PARTIAL’’.

(3) The table of sections for part I of subchapter P of

chapter 1 is amended by striking ‘‘50-percent’’ and inserting

‘‘Partial’’.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–605

(c) EFFECTIVE DATE.—The amendments made by this section

shall apply to stock acquired after the date of the enactment of

this Act.

Subtitle C—New Markets Tax Credit

SEC. 121. NEW MARKETS TAX CREDIT.

(a) IN GENERAL.—Subpart D of part IV of subchapter A of

chapter 1 (relating to business-related credits) is amended by adding

at the end the following new section:

‘‘SEC. 45D. NEW MARKETS TAX CREDIT.

‘‘(a) ALLOWANCE OF CREDIT.—

‘‘(1) IN GENERAL.—For purposes of section 38, in the case

of a taxpayer who holds a qualified equity investment on a

credit allowance date of such investment which occurs during

the taxable year, the new markets tax credit determined under

this section for such taxable year is an amount equal to the

applicable percentage of the amount paid to the qualified

community development entity for such investment at its original issue.

‘‘(2) APPLICABLE PERCENTAGE.—For purposes of paragraph

(1), the applicable percentage is—

‘‘(A) 5 percent with respect to the first 3 credit allowance dates, and

‘‘(B) 6 percent with respect to the remainder of the

credit allowance dates.

‘‘(3) CREDIT ALLOWANCE DATE.—For purposes of paragraph

(1), the term ‘credit allowance date’ means, with respect to

any qualified equity investment—

‘‘(A) the date on which such investment is initially

made, and

‘‘(B) each of the 6 anniversary dates of such date thereafter.

‘‘(b) QUALIFIED EQUITY INVESTMENT.—For purposes of this

section—

‘‘(1) IN GENERAL.—The term ‘qualified equity investment’

means any equity investment in a qualified community development entity if—

‘‘(A) such investment is acquired by the taxpayer at

its original issue (directly or through an underwriter) solely

in exchange for cash,

‘‘(B) substantially all of such cash is used by the qualified community development entity to make qualified lowincome community investments, and

‘‘(C) such investment is designated for purposes of this

section by the qualified community development entity.

Such term shall not include any equity investment issued by

a qualified community development entity more than 5 years

after the date that such entity receives an allocation under

subsection (f ). Any allocation not used within such 5-year period

may be reallocated by the Secretary under subsection (f ).

‘‘(2) LIMITATION.—The maximum amount of equity investments issued by a qualified community development entity

which may be designated under paragraph (1)(C) by such entity

114 STAT. 2763A–606 PUBLIC LAW 106–554—APPENDIX G

shall not exceed the portion of the limitation amount allocated

under subsection (f ) to such entity. ‘‘(3) SAFE HARBOR FOR DETERMINING USE OF CASH.—The

requirement of paragraph (1)(B) shall be treated as met if

at least 85 percent of the aggregate gross assets of the qualified

community development entity are invested in qualified lowincome community investments. ‘‘(4) TREATMENT OF SUBSEQUENT PURCHASERS.—The term ‘qualified equity investment’ includes any equity investment

which would (but for paragraph (1)(A)) be a qualified equity

investment in the hands of the taxpayer if such investment

was a qualified equity investment in the hands of a prior

holder. ‘‘(5) REDEMPTIONS.—A rule similar to the rule of section

1202(c)(3) shall apply for purposes of this subsection. ‘‘(6) EQUITY INVESTMENT.—The term ‘equity investment’ means—

‘‘(A) any stock (other than nonqualified preferred stock

as defined in section 351(g)(2)) in an entity which is a

corporation, and ‘‘(B) any capital interest in an entity which is a partnership. ‘‘(c) QUALIFIED COMMUNITY DEVELOPMENT ENTITY.—For purposes of this section—

‘‘(1) IN GENERAL.—The term ‘qualified community development entity’ means any domestic corporation or partnership

if—

‘‘(A) the primary mission of the entity is serving, or

providing investment capital for, low-income communities

or low-income persons,

‘‘(B) the entity maintains accountability to residents

of low-income communities through their representation

on any governing board of the entity or on any advisory

board to the entity, and

‘‘(C) the entity is certified by the Secretary for purposes

of this section as being a qualified community development

entity.

‘‘(2) SPECIAL RULES FOR CERTAIN ORGANIZATIONS.—The

requirements of paragraph (1) shall be treated as met by—

‘‘(A) any specialized small business investment company (as defined in section 1044(c)(3)), and

‘‘(B) any community development financial institution

(as defined in section 103 of the Community Development

Banking and Financial Institutions Act of 1994 (12 U.S.C.

4702)).

‘‘(d) QUALIFIED LOW-INCOME COMMUNITY INVESTMENTS.—For

purposes of this section—

‘‘(1) IN GENERAL.—The term ‘qualified low-income community investment’ means—

‘‘(A) any capital or equity investment in, or loan to,

any qualified active low-income community business, ‘‘(B) the purchase from another qualified community

development entity of any loan made by such entity which

is a qualified low-income community investment,

‘‘(C) financial counseling and other services specified

in regulations prescribed by the Secretary to businesses

located in, and residents of, low-income communities, and

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–607

‘‘(D) any equity investment in, or loan to, any qualified

community development entity.

‘‘(2) QUALIFIED ACTIVE LOW-INCOME COMMUNITY BUSINESS.—

‘‘(A) IN GENERAL.—For purposes of paragraph (1), the

term ‘qualified active low-income community business’

means, with respect to any taxable year, any corporation

(including a nonprofit corporation) or partnership if for

such year—

‘‘(i) at least 50 percent of the total gross income

of such entity is derived from the active conduct of

a qualified business within any low-income community,

‘‘(ii) a substantial portion of the use of the tangible

property of such entity (whether owned or leased) is

within any low-income community,

‘‘(iii) a substantial portion of the services performed for such entity by its employees are performed

in any low-income community,

‘‘(iv) less than 5 percent of the average of the

aggregate unadjusted bases of the property of such

entity is attributable to collectibles (as defined in section 408(m)(2)) other than collectibles that are held

primarily for sale to customers in the ordinary course

of such business, and

‘‘(v) less than 5 percent of the average of the aggregate unadjusted bases of the property of such entity

is attributable to nonqualified financial property (as

defined in section 1397C(e)).

‘‘(B) PROPRIETORSHIP.—Such term shall include any

business carried on by an individual as a proprietor if

such business would meet the requirements of subparagraph (A) were it incorporated.

‘‘(C) PORTIONS OF BUSINESS MAY BE QUALIFIED ACTIVE

LOW-INCOME COMMUNITY BUSINESS.—The term ‘qualified

active low-income community business’ includes any trades

or businesses which would qualify as a qualified active

low-income community business if such trades or

businesses were separately incorporated.

‘‘(3) QUALIFIED BUSINESS.—For purposes of this subsection,

the term ‘qualified business’ has the meaning given to such

term by section 1397C(d); except that—

‘‘(A) in lieu of applying paragraph (2)(B) thereof, the

rental to others of real property located in any low-income

community shall be treated as a qualified business if there

are substantial improvements located on such property,

and

‘‘(B) paragraph (3) thereof shall not apply.

‘‘(e) LOW-INCOME COMMUNITY.—For purposes of this section—

‘‘(1) IN GENERAL.—The term ‘low-income community’ means

any population census tract if—

‘‘(A) the poverty rate for such tract is at least 20

percent, or

‘‘(B)(i) in the case of a tract not located within a metropolitan area, the median family income for such tract does

not exceed 80 percent of statewide median family income,

or

114 STAT. 2763A–608 PUBLIC LAW 106–554—APPENDIX G

‘‘(ii) in the case of a tract located within a metropolitan

area, the median family income for such tract does not

exceed 80 percent of the greater of statewide median family

income or the metropolitan area median family income.

Subparagraph (B) shall be applied using possessionwide median

family income in the case of census tracts located within a

possession of the United States.

‘‘(2) TARGETED AREAS.—The Secretary may designate any

area within any census tract as a low-income community if— ‘‘(A) the boundary of such area is continuous,

‘‘(B) the area would satisfy the requirements of paragraph (1) if it were a census tract, and ‘‘(C) an inadequate access to investment capital exists

in such area.

‘‘(3) AREAS NOT WITHIN CENSUS TRACTS.—In the case of

an area which is not tracted for population census tracts, the

equivalent county divisions (as defined by the Bureau of the

Census for purposes of defining poverty areas) shall be used

for purposes of determining poverty rates and median family

income.

‘‘(f ) NATIONAL LIMITATION ON AMOUNT OF INVESTMENTS DESIGNATED.—

‘‘(1) IN GENERAL.—There is a new markets tax credit limitation for each calendar year. Such limitation is—

‘‘(A) $1,000,000,000 for 2001,

‘‘(B) $1,500,000,000 for 2002 and 2003,

‘‘(C) $2,000,000,000 for 2004 and 2005, and

‘‘(D) $3,500,000,000 for 2006 and 2007.

‘‘(2) ALLOCATION OF LIMITATION.—The limitation under

paragraph (1) shall be allocated by the Secretary among qualified community development entities selected by the Secretary.

In making allocations under the preceding sentence, the Secretary shall give priority to any entity—

‘‘(A) with a record of having successfully provided capital or technical assistance to disadvantaged businesses

or communities, or

‘‘(B) which intends to satisfy the requirement under

subsection (b)(1)(B) by making qualified low-income

community investments in 1 or more businesses in which

persons unrelated to such entity (within the meaning of

section 267(b) or 707(b)(1)) hold the majority equity

interest.

‘‘(3) CARRYOVER OF UNUSED LIMITATION.—If the new markets tax credit limitation for any calendar year exceeds the

aggregate amount allocated under paragraph (2) for such year,

such limitation for the succeeding calendar year shall be

increased by the amount of such excess. No amount may be

carried under the preceding sentence to any calendar year

after 2014.

‘‘(g) RECAPTURE OF CREDIT IN CERTAIN CASES.—

‘‘(1) IN GENERAL.—If, at any time during the 7-year period

beginning on the date of the original issue of a qualified equity

investment in a qualified community development entity, there

is a recapture event with respect to such investment, then

the tax imposed by this chapter for the taxable year in which

such event occurs shall be increased by the credit recapture

amount.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–609

‘‘(2) CREDIT RECAPTURE AMOUNT.—For purposes of paragraph (1), the credit recapture amount is an amount equal

to the sum of— ‘‘(A) the aggregate decrease in the credits allowed to

the taxpayer under section 38 for all prior taxable years

which would have resulted if no credit had been determined

under this section with respect to such investment, plus

‘‘(B) interest at the underpayment rate established

under section 6621 on the amount determined under

subparagraph (A) for each prior taxable year for the period

beginning on the due date for filing the return for the

prior taxable year involved.

No deduction shall be allowed under this chapter for interest

described in subparagraph (B).

‘‘(3) RECAPTURE EVENT.—For purposes of paragraph (1),

there is a recapture event with respect to an equity investment

in a qualified community development entity if— ‘‘(A) such entity ceases to be a qualified community

development entity, ‘‘(B) the proceeds of the investment cease to be used

as required of subsection (b)(1)(B), or ‘‘(C) such investment is redeemed by such entity. ‘‘(4) SPECIAL RULES.—

‘‘(A) TAX BENEFIT RULE.—The tax for the taxable year

shall be increased under paragraph (1) only with respect

to credits allowed by reason of this section which were

used to reduce tax liability. In the case of credits not

so used to reduce tax liability, the carryforwards and

carrybacks under section 39 shall be appropriately

adjusted.

‘‘(B) NO CREDITS AGAINST TAX.—Any increase in tax

under this subsection shall not be treated as a tax imposed

by this chapter for purposes of determining the amount

of any credit under this chapter or for purposes of section

55. ‘‘(h) BASIS REDUCTION.—The basis of any qualified equity

investment shall be reduced by the amount of any credit determined

under this section with respect to such investment. This subsection

shall not apply for purposes of sections 1202, 1400B, and 1400F.

‘‘(i) REGULATIONS.—The Secretary shall prescribe such regulations as may be appropriate to carry out this section, including

regulations—

‘‘(1) which limit the credit for investments which are

directly or indirectly subsidized by other Federal tax benefits

(including the credit under section 42 and the exclusion from

gross income under section 103),

‘‘(2) which prevent the abuse of the purposes of this section,

‘‘(3) which provide rules for determining whether the

requirement of subsection (b)(1)(B) is treated as met,

‘‘(4) which impose appropriate reporting requirements, and

‘‘(5) which apply the provisions of this section to newly

formed entities.’’.

(b) CREDIT MADE PART OF GENERAL BUSINESS CREDIT.—

(1) IN GENERAL.—Subsection (b) of section 38 is amended

by striking ‘‘plus’’ at the end of paragraph (11), by striking

the period at the end of paragraph (12) and inserting ‘‘, plus’’,

and by adding at the end the following new paragraph:

114 STAT. 2763A–610 PUBLIC LAW 106–554—APPENDIX G

‘‘(13) the new markets tax credit determined under section

45D(a).’’. (2) LIMITATION ON CARRYBACK.—Subsection (d) of section

39 is amended by adding at the end the following new paragraph: ‘‘(9) NO CARRYBACK OF NEW MARKETS TAX CREDIT BEFORE

JANUARY 1, 2001.—No portion of the unused business credit

for any taxable year which is attributable to the credit under

section 45D may be carried back to a taxable year ending

before January 1, 2001.’’. (c) DEDUCTION FOR UNUSED CREDIT.—Subsection (c) of section

196 is amended by striking ‘‘and’’ at the end of paragraph (7),

by striking the period at the end of paragraph (8) and inserting

‘‘, and’’, and by adding at the end the following new paragraph:

‘‘(9) the new markets tax credit determined under section

45D(a).’’. (d) CLERICAL AMENDMENT.—The table of sections for subpart

D of part IV of subchapter A of chapter 1 is amended by adding

at the end the following new item:

‘‘Sec. 45D. New markets tax credit.’’.

(e) EFFECTIVE DATE.—The amendments made by this section

shall apply to investments made after December 31, 2000.

(f ) GUIDANCE ON ALLOCATION OF NATIONAL LIMITATION.—Not

later than 120 days after the date of the enactment of this Act,

the Secretary of the Treasury or the Secretary’s delegate shall

issue guidance which specifies—

(1) how entities shall apply for an allocation under section

45D(f )(2) of the Internal Revenue Code of 1986, as added by

this section;

(2) the competitive procedure through which such allocations are made; and

(3) the actions that such Secretary or delegate shall take

to ensure that such allocations are properly made to appropriate

entities.

(g) AUDIT AND REPORT.—Not later than January 31 of 2004,

2007, and 2010, the Comptroller General of the United States

shall, pursuant to an audit of the new markets tax credit program

established under section 45D of the Internal Revenue Code of

1986 (as added by subsection (a)), report to Congress on such

program, including all qualified community development entities

that receive an allocation under the new markets credit under

such section.

Subtitle D—Improvements in Low-Income

Housing Credit

SEC. 131. MODIFICATION OF STATE CEILING ON LOW-INCOME HOUSING CREDIT.

(a) IN GENERAL.—Clauses (i) and (ii) of section 42(h)(3)(C)

(relating to State housing credit ceiling) are amended to read as

follows:

‘‘(i) the unused State housing credit ceiling (if any)

of such State for the preceding calendar year,

‘‘(ii) the greater of—

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–611

‘‘(I) $1.75 ($1.50 for 2001) multiplied by the

State population, or

‘‘(II) $2,000,000,’’.

(b) ADJUSTMENT OF STATE CEILING FOR INCREASES IN COSTOF-LIVING.—Paragraph (3) of section 42(h) (relating to housing

credit dollar amount for agencies) is amended by adding at the

end the following new subparagraph:

‘‘(H) COST-OF-LIVING ADJUSTMENT.—

‘‘(i) IN GENERAL.—In the case of a calendar year

after 2002, the $2,000,000 and $1.75 amounts in

subparagraph (C) shall each be increased by an amount

equal to—

‘‘(I) such dollar amount, multiplied by

‘‘(II) the cost-of-living adjustment determined

under section 1(f )(3) for such calendar year by

substituting ‘calendar year 2001’ for ‘calendar year

1992’ in subparagraph (B) thereof.

‘‘(ii) ROUNDING.—

‘‘(I) In the case of the $2,000,000 amount, any

increase under clause (i) which is not a multiple

of $5,000 shall be rounded to the next lowest multiple of $5,000.

‘‘(II) In the case of the $1.75 amount, any

increase under clause (i) which is not a multiple

of 5 cents shall be rounded to the next lowest

multiple of 5 cents.’’.

(c) CONFORMING AMENDMENTS.—

(1) Section 42(h)(3)(C), as amended by subsection (a), is

amended—

(A) by striking ‘‘clause (ii)’’ in the matter following

clause (iv) and inserting ‘‘clause (i)’’; and

(B) by striking ‘‘clauses (i)’’ in the matter following

clause (iv) and inserting ‘‘clauses (ii)’’.

(2) Section 42(h)(3)(D)(ii) is amended—

(A) by striking ‘‘subparagraph (C)(ii)’’ and inserting

‘‘subparagraph (C)(i)’’; and

(B) by striking ‘‘clauses (i)’’ in subclause (II) and inserting ‘‘clauses (ii)’’.

(d) EFFECTIVE DATE.—The amendments made by this section

shall apply to calendar years after 2000.

SEC. 132. MODIFICATION OF CRITERIA FOR ALLOCATING HOUSING

CREDITS AMONG PROJECTS.

(a) SELECTION CRITERIA.—Subparagraph (C) of section 42(m)(1)

(relating to certain selection criteria must be used) is amended—

(1) by inserting ‘‘, including whether the project includes

the use of existing housing as part of a community revitalization

plan’’ before the comma at the end of clause (iii); and

(2) by striking clauses (v), (vi), and (vii) and inserting

the following new clauses:

‘‘(v) tenant populations with special housing needs,

‘‘(vi) public housing waiting lists,

‘‘(vii) tenant populations of individuals with children, and

‘‘(viii) projects intended for eventual tenant ownership.’’.

114 STAT. 2763A–612 PUBLIC LAW 106–554—APPENDIX G

(b) PREFERENCE FOR COMMUNITY REVITALIZATION PROJECTS

LOCATED IN QUALIFIED CENSUS TRACTS.—Clause (ii) of section

42(m)(1)(B) is amended by striking ‘‘and’’ at the end of subclause

(I), by adding ‘‘and’’ at the end of subclause (II), and by inserting

after subclause (II) the following new subclause: ‘‘(III) projects which are located in qualified

census tracts (as defined in subsection (d)(5)(C))

and the development of which contributes to a

concerted community revitalization plan,’’.

SEC. 133. ADDITIONAL RESPONSIBILITIES OF HOUSING CREDIT AGENCIES.

(a) MARKET STUDY; PUBLIC DISCLOSURE OF RATIONALE FOR

NOT FOLLOWING CREDIT ALLOCATION PRIORITIES.—Subparagraph

(A) of section 42(m)(1) (relating to responsibilities of housing credit

agencies) is amended by striking ‘‘and’’ at the end of clause (i),

by striking the period at the end of clause (ii) and inserting a

comma, and by adding at the end the following new clauses: ‘‘(iii) a comprehensive market study of the housing

needs of low-income individuals in the area to be served

by the project is conducted before the credit allocation

is made and at the developer’s expense by a disinterested party who is approved by such agency, and ‘‘(iv) a written explanation is available to the general public for any allocation of a housing credit dollar

amount which is not made in accordance with established priorities and selection criteria of the housing

credit agency.’’. (b) SITE VISITS.—Clause (iii) of section 42(m)(1)(B) (relating

to qualified allocation plan) is amended by inserting before the

period ‘‘and in monitoring for noncompliance with habitability

standards through regular site visits’’.

SEC. 134. MODIFICATIONS TO RULES RELATING TO BASIS OF BUILDING

WHICH IS ELIGIBLE FOR CREDIT.

(a) ADJUSTED BASIS TO INCLUDE PORTION OF CERTAIN BUILD- INGS USED BY LOW-INCOME INDIVIDUALS WHO ARE NOT TENANTS

AND BY PROJECT EMPLOYEES.—Paragraph (4) of section 42(d) (relating to special rules relating to determination of adjusted basis)

is amended— (1) by striking ‘‘subparagraph (B)’’ in subparagraph (A)

and inserting ‘‘subparagraphs (B) and (C)’’;

(2) by redesignating subparagraph (C) as subparagraph

(D); and

(3) by inserting after subparagraph (B) the following new

subparagraph: ‘‘(C) INCLUSION OF BASIS OF PROPERTY USED TO PROVIDE

SERVICES FOR CERTAIN NONTENANTS.— ‘‘(i) IN GENERAL.—The adjusted basis of any building located in a qualified census tract (as defined in

paragraph (5)(C)) shall be determined by taking into

account the adjusted basis of property (of a character

subject to the allowance for depreciation and not otherwise taken into account) used throughout the taxable

year in providing any community service facility.

‘‘(ii) LIMITATION.—The increase in the adjusted

basis of any building which is taken into account by

reason of clause (i) shall not exceed 10 percent of

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–613

the eligible basis of the qualified low-income housing

project of which it is a part. For purposes of the preceding sentence, all community service facilities which

are part of the same qualified low-income housing

project shall be treated as one facility. ‘‘(iii) COMMUNITY SERVICE FACILITY.—For purposes

of this subparagraph, the term ‘community service

facility’ means any facility designed to serve primarily

individuals whose income is 60 percent or less of area

median income (within the meaning of subsection

(g)(1)(B)).’’. (b) CERTAIN NATIVE AMERICAN HOUSING ASSISTANCE DIS- REGARDED IN DETERMINING WHETHER BUILDING IS FEDERALLY SUB- SIDIZED FOR PURPOSES OF THE LOW-INCOME HOUSING CREDIT.— Subparagraph (E) of section 42(i)(2) (relating to determination of

whether building is federally subsidized) is amended— (1) in clause (i), by inserting ‘‘or the Native American

Housing Assistance and Self-Determination Act of 1996 (25

U.S.C. 4101 et seq.) (as in effect on October 1, 1997)’’ after

‘‘this subparagraph)’’; and

(2) in the subparagraph heading, by inserting ‘‘OR NATIVE

AMERICAN HOUSING ASSISTANCE’’ after ‘‘HOME ASSISTANCE’’.

SEC. 135. OTHER MODIFICATIONS.

(a) ALLOCATION OF CREDIT LIMIT TO CERTAIN BUILDINGS.—

(1) The first sentence of section 42(h)(1)(E)(ii) is amended

by striking ‘‘(as of’’ the first place it appears and inserting

‘‘(as of the later of the date which is 6 months after the

date that the allocation was made or’’.

(2) The last sentence of section 42(h)(3)(C) is amended

by striking ‘‘project which’’ and inserting ‘‘project which fails

to meet the 10 percent test under paragraph (1)(E)(ii) on a

date after the close of the calendar year in which the allocation

was made or which’’.

(b) DETERMINATION OF WHETHER BUILDINGS ARE LOCATED IN

HIGH COST AREAS.—The first sentence of section 42(d)(5)(C)(ii)(I)

is amended—

(1) by inserting ‘‘either’’ before ‘‘in which 50 percent’’; and

(2) by inserting before the period ‘‘or which has a poverty

rate of at least 25 percent’’.

SEC. 136. CARRYFORWARD RULES.

(a) IN GENERAL.—Clause (ii) of section 42(h)(3)(D) (relating

to unused housing credit carryovers allocated among certain States)

is amended by striking ‘‘the excess’’ and all that follows and inserting ‘‘the excess (if any) of— ‘‘(I) the unused State housing credit ceiling

for the year preceding such year, over ‘‘(II) the aggregate housing credit dollar

amount allocated for such year.’’. (b) CONFORMING AMENDMENT.—The second sentence of section

42(h)(3)(C) (relating to State housing credit ceiling) is amended

by striking ‘‘clauses (i) and (iii)’’ and inserting ‘‘clauses (i) through

(iv)’’.

SEC. 137. EFFECTIVE DATE.

Except as otherwise provided in this subtitle, the amendments

made by this subtitle shall apply to—

114 STAT. 2763A–614 PUBLIC LAW 106–554—APPENDIX G

(1) housing credit dollar amounts allocated after December

31, 2000; and

(2) buildings placed in service after such date to the extent

paragraph (1) of section 42(h) of the Internal Revenue Code

of 1986 does not apply to any building by reason of paragraph

(4) thereof, but only with respect to bonds issued after such

date.

Subtitle E—Other Community Renewal

and New Markets Assistance

PART I—PROVISIONS RELATING TO HOUSING

AND SUBSTANCE ABUSE PREVENTION AND

TREATMENT

SEC. 141. TRANSFER OF UNOCCUPIED AND SUBSTANDARD HUD-HELD

HOUSING TO LOCAL GOVERNMENTS AND COMMUNITY

DEVELOPMENT CORPORATIONS.

Section 204 of the Departments of Veterans Affairs and Housing

and Urban Development, and Independent Agencies Appropriations

Act, 1997 (12 U.S.C. 1715z–11a) is amended—

(1) by striking ‘‘FLEXIBLE AUTHORITY.—’’ and inserting

‘‘DISPOSITION OF HUD-OWNED PROPERTIES. (a) FLEXIBLE

AUTHORITY FOR MULTIFAMILY PROJECTS.—’’; and

(2) by adding at the end the following new subsection:

‘‘(b) TRANSFER OF UNOCCUPIED AND SUBSTANDARD HOUSING

TO LOCAL GOVERNMENTS AND COMMUNITY DEVELOPMENT CORPORATIONS.—

‘‘(1) TRANSFER AUTHORITY.—Notwithstanding the authority

under subsection (a) and the last sentence of section 204(g)

of the National Housing Act (12 U.S.C. 1710(g)), the Secretary

of Housing and Urban Development shall transfer ownership

of any qualified HUD property, subject to the requirements

of this section, to a unit of general local government having

jurisdiction for the area in which the property is located or

to a community development corporation which operates within

such a unit of general local government in accordance with

this subsection, but only to the extent that units of general

local government and community development corporations consent to transfer and the Secretary determines that such transfer

is practicable.

‘‘(2) QUALIFIED HUD PROPERTIES.—For purposes of this subsection, the term ‘qualified HUD property’ means any property

for which, as of the date that notification of the property is

first made under paragraph (3)(B), not less than 6 months

have elapsed since the later of the date that the property

was acquired by the Secretary or the date that the property

was determined to be unoccupied or substandard, that is owned

by the Secretary and is— ‘‘(A) an unoccupied multifamily housing project;

‘‘(B) a substandard multifamily housing project; or

‘‘(C) an unoccupied single family property that—

‘‘(i) has been determined by the Secretary not to

be an eligible asset under section 204(h) of the National

Housing Act (12 U.S.C. 1710(h)); or

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–615

‘‘(ii) is an eligible asset under such section 204(h),

but— ‘‘(I) is not subject to a specific sale agreement

under such section; and

‘‘(II) has been determined by the Secretary

to be inappropriate for continued inclusion in the

program under such section 204(h) pursuant to

paragraph (10) of such section.

‘‘(3) TIMING.—The Secretary shall establish procedures that

provide for—

‘‘(A) time deadlines for transfers under this subsection;

‘‘(B) notification to units of general local government

and community development corporations of qualified HUD

properties in their jurisdictions; ‘‘(C) such units and corporations to express interest

in the transfer under this subsection of such properties; ‘‘(D) a right of first refusal for transfer of qualified

HUD properties to units of general local government and

community development corporations, under which— ‘‘(i) the Secretary shall establish a period during

which the Secretary may not transfer such properties

except to such units and corporations; ‘‘(ii) the Secretary shall offer qualified HUD properties that are single family properties for purchase

by units of general local government at a cost of $1

for each property, but only to the extent that the

costs to the Federal Government of disposal at such

price do not exceed the costs to the Federal Government of disposing of property subject to the procedures

for single family property established by the Secretary

pursuant to the authority under the last sentence of

section 204(g) of the National Housing Act (12 U.S.C.

1710(g));

‘‘(iii) the Secretary may accept an offer to purchase

a property made by a community development corporation only if the offer provides for purchase on a cost

recovery basis; and

‘‘(iv) the Secretary shall accept an offer to purchase

such a property that is made during such period by

such a unit or corporation and that complies with

the requirements of this paragraph; and

‘‘(E) a written explanation, to any unit of general local

government or community development corporation making

an offer to purchase a qualified HUD property under this

subsection that is not accepted, of the reason that such

offer was not acceptable.

‘‘(4) OTHER DISPOSITION.—With respect to any qualified

HUD property, if the Secretary does not receive an acceptable

offer to purchase the property pursuant to the procedure established under paragraph (3), the Secretary shall dispose of the

property to the unit of general local government in which

property is located or to community development corporations

located in such unit of general local government on a negotiated,

competitive bid, or other basis, on such terms as the Secretary

deems appropriate.

‘‘(5) SATISFACTION OF INDEBTEDNESS.—Before transferring

ownership of any qualified HUD property pursuant to this

114 STAT. 2763A–616 PUBLIC LAW 106–554—APPENDIX G

subsection, the Secretary shall satisfy any indebtedness

incurred in connection with the property to be transferred,

by canceling the indebtedness. ‘‘(6) DETERMINATION OF STATUS OF PROPERTIES.—To ensure

compliance with the requirements of this subsection, the Secretary shall take the following actions: ‘‘(A) UPON ENACTMENT.—Upon the enactment of this

subsection, the Secretary shall promptly assess each residential property owned by the Secretary to determine

whether such property is a qualified HUD property. ‘‘(B) UPON ACQUISITION.—Upon acquiring any residential property, the Secretary shall promptly determine

whether the property is a qualified HUD property. ‘‘(C) UPDATES.—The Secretary shall periodically

reassess the residential properties owned by the Secretary

to determine whether any such properties have become

qualified HUD properties.

‘‘(7) TENANT LEASES.—This subsection shall not affect the

terms or the enforceability of any contract or lease entered

into with respect to any residential property before the date

that such property becomes a qualified HUD property.

‘‘(8) USE OF PROPERTY.—Property transferred under this

subsection shall be used only for appropriate neighborhood

revitalization efforts, including homeownership, rental units,

commercial space, and parks, consistent with local zoning regulations, local building codes, and subdivision regulations and

restrictions of record.

‘‘(9) INAPPLICABILITY TO PROPERTIES MADE AVAILABLE FOR

HOMELESS.—Notwithstanding any other provision of this subsection, this subsection shall not apply to any properties that

the Secretary determines are to be made available for use

by the homeless pursuant to subpart E of part 291 of title

24, Code of Federal Regulations, during the period that the

properties are so available.

‘‘(10) PROTECTION OF EXISTING CONTRACTS.—This subsection may not be construed to alter, affect, or annul any

legally binding obligations entered into with respect to a qualified HUD property before the property becomes a qualified

HUD property.

‘‘(11) DEFINITIONS.—For purposes of this subsection, the

following definitions shall apply:

‘‘(A) COMMUNITY DEVELOPMENT CORPORATION.—The

term ‘community development corporation’ means a nonprofit organization whose primary purpose is to promote

community development by providing housing opportunities

for low-income families.

‘‘(B) COST RECOVERY BASIS.—The term ‘cost recovery

basis’ means, with respect to any sale of a residential

property by the Secretary, that the purchase price paid

by the purchaser is equal to or greater than the sum

of: (i) the appraised value of the property, as determined

in accordance with such requirements as the Secretary

shall establish; and (ii) the costs incurred by the Secretary

in connection with such property during the period beginning on the date on which the Secretary acquires title

to the property and ending on the date on which the

sale is consummated.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–617

‘‘(C) MULTIFAMILY HOUSING PROJECT.—The term ‘multifamily housing project’ has the meaning given the term

in section 203 of the Housing and Community Development

Amendments of 1978.

‘‘(D) RESIDENTIAL PROPERTY.—The term ‘residential

property’ means a property that is a multifamily housing

project or a single family property. ‘‘(E) SECRETARY.—The term ‘Secretary’ means the Secretary of Housing and Urban Development. ‘‘(F) SEVERE PHYSICAL PROBLEMS.—The term ‘severe

physical problems’ means, with respect to a dwelling unit,

that the unit— ‘‘(i) lacks hot or cold piped water, a flush toilet,

or both a bathtub and a shower in the unit, for the

exclusive use of that unit; ‘‘(ii) on not less than three separate occasions during the preceding winter months, was uncomfortably

cold for a period of more than 6 consecutive hours

due to a malfunction of the heating system for the

unit;‘‘(iii) has no functioning electrical service, exposed

wiring, any room in which there is not a functioning

electrical outlet, or has experienced three or more

blown fuses or tripped circuit breakers during the

preceding 90-day period; ‘‘(iv) is accessible through a public hallway in

which there are no working light fixtures, loose or

missing steps or railings, and no elevator; or

‘‘(v) has severe maintenance problems, including

water leaks involving the roof, windows, doors, basement, or pipes or plumbing fixtures, holes or open

cracks in walls or ceilings, severe paint peeling or

broken plaster, and signs of rodent infestation.

‘‘(G) SINGLE FAMILY PROPERTY.—The term ‘single family property’ means a 1- to 4-family residence. ‘‘(H) SUBSTANDARD.—The term ‘substandard’ means,

with respect to a multifamily housing project, that 25 percent or more of the dwelling units in the project have

severe physical problems.

‘‘(I) UNIT OF GENERAL LOCAL GOVERNMENT.—The term

‘unit of general local government’ has the meaning given

such term in section 102(a) of the Housing and Community

Development Act of 1974.

‘‘(J) UNOCCUPIED.—The term ‘unoccupied’ means, with

respect to a residential property, that the unit of general

local government having jurisdiction over the area in which

the project is located has certified in writing that the

property is not inhabited.

‘‘(12) REGULATIONS.—

‘‘(A) INTERIM.—Not later than 30 days after the date

of the enactment of this subsection, the Secretary shall

issue such interim regulations as are necessary to carry

out this subsection.

‘‘(B) FINAL.—Not later than 60 days after the date

of the enactment of this subsection, the Secretary shall

issue such final regulations as are necessary to carry out

this subsection.’’.

114 STAT. 2763A–618 PUBLIC LAW 106–554—APPENDIX G

SEC. 142. TRANSFER OF HUD ASSETS IN REVITALIZATION AREAS.

In carrying out the program under section 204(h) of the

National Housing Act (12 U.S.C. 1710(h)), upon the request of

the chief executive officer of a county or the government of appropriate jurisdiction and not later than 60 days after such request

is made, the Secretary of Housing and Urban Development shall

designate as a revitalization area all portions of such county that

meet the criteria for such designation under paragraph (3) of such

section.

SEC. 143. RISK-SHARING DEMONSTRATION.

Section 249 of the National Housing Act (12 U.S.C. 1715z– 14) is amended— (1) by striking the section heading and inserting the following:

‘‘RISK-SHARING DEMONSTRATION’’;

(2) by striking ‘‘reinsurance’’ each place such term appears

and insert ‘‘risk-sharing’’;

(3) in subsection (a)— (A) in the first sentence, by inserting ‘‘and with insured

community development financial institutions’’ after ‘‘private mortgage insurers’’;

(B) in the second sentence— (i) by striking ‘‘two’’ and inserting ‘‘four’’; and

(ii) by striking ‘‘March 15, 1988’’ and inserting ‘‘the expiration of the 5-year period beginning on the

date of the enactment of the Community Renewal Tax

Relief Act of 2000’’; and

(C) in the third sentence— (i) by striking ‘‘insured’’ and inserting ‘‘for which

risk of nonpayment is shared’’; and

(ii) by striking ‘‘10 percent’’ and inserting ‘‘20 percent’’;

(4) in subsection (b)— (A) in the first sentence— (i) by striking ‘‘to provide’’ and inserting ‘‘, in

providing’’;

(ii) by striking ‘‘through’’ and inserting ‘‘, to enter

into’’; and

(iii) by inserting ‘‘and with insured community

development financial institutions’’ before the period

at the end;

(B) in the second sentence, by inserting ‘‘and insured

community development financial institutions’’ after ‘‘private mortgage insurance companies’’;

(C) by striking paragraph (1) and inserting the following new paragraph:

‘‘(1) assume a secondary percentage of loss on any mortgage

insured pursuant to section 203(b), 234, or 245 covering a

one- to four-family dwelling, which percentage of loss shall

be set forth in the risk-sharing contract, with the first percentage of loss to be borne by the Secretary;’’; and

(D) in paragraph (2)— (i) by striking ‘‘carry out (under appropriate delegation) such’’ and inserting ‘‘perform or delegate underwriting,’’;

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–619

(ii) by striking ‘‘function as the Secretary pursuant

to regulations,’’ and inserting ‘‘functions as the Secretary’’; and

(iii) by inserting before the period at the end the

following: ‘‘and shall set forth in the risk-sharing contract’’;

(5) in subsection (c)—

(A) in the first sentence—

(i) by striking ‘‘of’’ the first place it appears and

inserting ‘‘for’’;

(ii) by inserting ‘‘received by the Secretary with

a private mortgage insurer or insured community

development financial institution’’ after ‘‘sharing of premiums’’;

(iii) by striking ‘‘insurance reserves’’ and inserting

‘‘loss reserves’’;

(iv) by striking ‘‘such insurance’’ and inserting

‘‘such risk-sharing contract’’; and

(v) by striking ‘‘right’’ and inserting ‘‘rights’’; and

(B) in the second sentence—

(i) by inserting ‘‘or insured community development financial institution’’ after ‘‘private mortgage

insurance company’’; and

(ii) by striking ‘‘for insurance’’ and inserting ‘‘for

risk-sharing’’;

(6) in subsection (d), by inserting ‘‘or insured community

development financial institution’’ after ‘‘private mortgage

insurance company’’; and

(7) by adding at the end the following new subsection: ‘‘(e) INSURED COMMUNITY DEVELOPMENT FINANCIAL INSTITUTION.—For purposes of this section, the term ‘insured community

development financial institution’ means a community development

financial institution, as such term is defined in section 103 of

Reigle Community Development and Regulatory Improvement Act

of 1994 (12 U.S.C. 4702) that is an insured depository institution

(as such term is defined in section 3 of the Federal Deposit Insurance Act (12 U.S.C. 1813)) or an insured credit union (as such

term is defined in section 101 of the Federal Credit Union Act

(12 U.S.C. 1752)).’’.

SEC. 144. PREVENTION AND TREATMENT OF SUBSTANCE ABUSE; SERVICES PROVIDED THROUGH RELIGIOUS ORGANIZATIONS.

Title V of the Public Health Service Act (42 U.S.C. 290aa

et seq.) is amended by adding at the end the following part:

‘‘PART G—SERVICES PROVIDED THROUGH RELIGIOUS ORGANIZATIONS

‘‘SEC. 581. APPLICABILITY TO DESIGNATED PROGRAMS.

‘‘(a) DESIGNATED PROGRAMS.—Subject to subsection (b), this

part applies to discretionary and formula grant programs administered by the Substance Abuse and Mental Health Services Administration that make awards of financial assistance to public or private

entities for the purpose of carrying out activities to prevent or

treat substance abuse (in this part referred to as a ‘designated

program’). Designated programs include the program under subpart

II of part B of title XIX (relating to formula grants to the States).

114 STAT. 2763A–620 PUBLIC LAW 106–554—APPENDIX G

‘‘(b) LIMITATION.—This part does not apply to any award of

financial assistance under a designated program for a purpose

other than the purpose specified in subsection (a).

‘‘(c) DEFINITIONS.—For purposes of this part (and subject to

subsection (b)):

‘‘(1) The term ‘designated program’ has the meaning given

such term in subsection (a).

‘‘(2) The term ‘financial assistance’ means a grant, cooperative agreement, or contract.

‘‘(3) The term ‘program beneficiary’ means an individual

who receives program services.

‘‘(4) The term ‘program participant’ means a public or private entity that has received financial assistance under a designated program.

‘‘(5) The term ‘program services’ means treatment for substance abuse, or preventive services regarding such abuse, provided pursuant to an award of financial assistance under a

designated program.

‘‘(6) The term ‘religious organization’ means a nonprofit

religious organization.

‘‘SEC. 582. RELIGIOUS ORGANIZATIONS AS PROGRAM PARTICIPANTS.

‘‘(a) IN GENERAL.—Notwithstanding any other provision of law,

a religious organization, on the same basis as any other nonprofit

private provider—

‘‘(1) may receive financial assistance under a designated

program; and

‘‘(2) may be a provider of services under a designated

program.

‘‘(b) RELIGIOUS ORGANIZATIONS.—The purpose of this section

is to allow religious organizations to be program participants on

the same basis as any other nonprofit private provider without

impairing the religious character of such organizations, and without

diminishing the religious freedom of program beneficiaries.

‘‘(c) NONDISCRIMINATION AGAINST RELIGIOUS ORGANIZATIONS.—

‘‘(1) ELIGIBILITY AS PROGRAM PARTICIPANTS.—Religious

organizations are eligible to be program participants on the

same basis as any other nonprofit private organization as long

as the programs are implemented consistent with the Establishment Clause and Free Exercise Clause of the First Amendment

to the United States Constitution. Nothing in this Act shall

be construed to restrict the ability of the Federal Government,

or a State or local government receiving funds under such

programs, to apply to religious organizations the same eligibility conditions in designated programs as are applied to any

other nonprofit private organization.

‘‘(2) NONDISCRIMINATION.—Neither the Federal Government nor a State or local government receiving funds under

designated programs shall discriminate against an organization

that is or applies to be a program participant on the basis

that the organization has a religious character.

‘‘(d) RELIGIOUS CHARACTER AND FREEDOM.—

‘‘(1) RELIGIOUS ORGANIZATIONS.—Except as provided in this

section, any religious organization that is a program participant

shall retain its independence from Federal, State, and local

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–621

government, including such organization’s control over the definition, development, practice, and expression of its religious

beliefs. ‘‘(2) ADDITIONAL SAFEGUARDS.—Neither the Federal

Government nor a State shall require a religious organization

to— ‘‘(A) alter its form of internal governance; or

‘‘(B) remove religious art, icons, scripture, or other

symbols,

in order to be a program participant.

‘‘(e) EMPLOYMENT PRACTICES.—Nothing in this section shall

be construed to modify or affect the provisions of any other Federal

or State law or regulation that relates to discrimination in employment. A religious organization’s exemption provided under section

702 of the Civil Rights Act of 1964 regarding employment practices

shall not be affected by its participation in, or receipt of funds

from, a designated program. ‘‘(f ) RIGHTS OF PROGRAM BENEFICIARIES.—

‘‘(1) IN GENERAL.—If an individual who is a program beneficiary or a prospective program beneficiary objects to the religious character of a program participant, within a reasonable

period of time after the date of such objection such program

participant shall refer such individual to, and the appropriate

Federal, State, or local government that administers a designated program or is a program participant shall provide to

such individual (if otherwise eligible for such services), program

services that—

‘‘(A) are from an alternative provider that is accessible

to, and has the capacity to provide such services to, such

individual; and

‘‘(B) have a value that is not less than the value

of the services that the individual would have received

from the program participant to which the individual had

such objection.

Upon referring a program beneficiary to an alternative provider,

the program participant shall notify the appropriate Federal,

State, or local government agency that administers the program

of such referral.

‘‘(2) NOTICES.—Program participants, public agencies that

refer individuals to designated programs, and the appropriate

Federal, State, or local governments that administer designated

programs or are program participants shall ensure that notice

is provided to program beneficiaries or prospective program

beneficiaries of their rights under this section.

‘‘(3) ADDITIONAL REQUIREMENTS.—A program participant

making a referral pursuant to paragraph (1) shall—

‘‘(A) prior to making such referral, consider any list

that the State or local government makes available of

entities in the geographic area that provide program services; and

‘‘(B) ensure that the individual makes contact with

the alternative provider to which the individual is referred.

‘‘(4) NONDISCRIMINATION.—A religious organization that is

a program participant shall not in providing program services

or engaging in outreach activities under designated programs

discriminate against a program beneficiary or prospective program beneficiary on the basis of religion or religious belief.

114 STAT. 2763A–622 PUBLIC LAW 106–554—APPENDIX G

‘‘(g) FISCAL ACCOUNTABILITY.— ‘‘(1) IN GENERAL.—Except as provided in paragraph (2),

any religious organization that is a program participant shall

be subject to the same regulations as other recipients of awards

of Federal financial assistance to account, in accordance with

generally accepted auditing principles, for the use of the funds

provided under such awards.

‘‘(2) LIMITED AUDIT.—With respect to the award involved,

a religious organization that is a program participant shall

segregate Federal amounts provided under award into a separate account from non-Federal funds. Only the award funds

shall be subject to audit by the government.

‘‘(h) COMPLIANCE.—With respect to compliance with this section

by an agency, a religious organization may obtain judicial review

of agency action in accordance with chapter 7 of title 5, United

States Code.

‘‘SEC. 583. LIMITATIONS ON USE OF FUNDS FOR CERTAIN PURPOSES.

‘‘No funds provided under a designated program shall be

expended for sectarian worship, instruction, or proselytization.

‘‘SEC. 584. EDUCATIONAL REQUIREMENTS FOR PERSONNEL IN DRUG

TREATMENT PROGRAMS.

‘‘(a) FINDINGS.—The Congress finds that— ‘‘(1) establishing unduly rigid or uniform educational qualification for counselors and other personnel in drug treatment

programs may undermine the effectiveness of such programs;

and ‘‘(2) such educational requirements for counselors and other

personnel may hinder or prevent the provision of needed drug

treatment services.

‘‘(b) NONDISCRIMINATION.—In determining whether personnel

of a program participant that has a record of successful drug treatment for the preceding three years have satisfied State or local

requirements for education and training, a State or local government shall not discriminate against education and training provided

to such personnel by a religious organization, so long as such

education and training includes basic content substantially equivalent to the content provided by nonreligious organizations that

the State or local government would credit for purposes of determining whether the relevant requirements have been satisfied.’’.

PART II—ADVISORY COUNCIL ON COMMUNITY

RENEWAL

SEC. 151. SHORT TITLE.

This part may be cited as the ‘‘Advisory Council on Community

Renewal Act’’.

SEC. 152. ESTABLISHMENT.

There is established an advisory council to be known as the

‘‘Advisory Council on Community Renewal’’ (in this part referred

to as the ‘‘Advisory Council’’).

SEC. 153. DUTIES OF ADVISORY COUNCIL.

The Advisory Council shall advise the Secretary of Housing

and Urban Development (in this part referred to as the ‘‘Secretary’’)

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–623

on the designation of renewal communities pursuant to the amendment made by section 101 and on the exercise of any other authority

granted to the Secretary pursuant to the amendments made by

this title.

SEC. 154. MEMBERSHIP.

(a) NUMBER AND APPOINTMENT.—The Advisory Council shall

be composed of 7 members appointed by the Secretary.

(b) CHAIRPERSON.—The Chairperson of the Advisory Council

(in this part referred to as the ‘‘Chairperson’’) shall be designated

by the Secretary at the time of the appointment.

(c) TERMS.—Each member shall be appointed for the life of

the Advisory Council.

(d) BASIC PAY.— (1) CHAIRPERSON.—The Chairperson shall be paid at a

rate equal to the daily rate of basic pay for level III of the

Executive Schedule for each day (including travel time) during

which the Chairperson is engaged in the actual performance

of duties vested in the Advisory Council.

(2) OTHER MEMBERS.—Members other than the Chairperson

shall each be paid at a rate equal to the daily rate of basic

pay for level IV of the Executive Schedule for each day (including travel time) during which they are engaged in the actual

performance of duties vested in the Advisory Council.

(e) TRAVEL EXPENSES.—Each member shall receive travel

expenses, including per diem in lieu of subsistence, in accordance

with applicable provisions under subchapter I of chapter 57 of

title 5, United States Code.

(f ) QUORUM.—Four members of the Advisory Council shall constitute a quorum but a lesser number may hold hearings.

(g) MEETINGS.—The Advisory Council shall meet at the call

of the Secretary or the Chairperson.

SEC. 155. POWERS OF ADVISORY COUNCIL.

(a) HEARINGS AND SESSIONS.—The Advisory Council may, for

the purpose of carrying out this part, hold hearings, sit and act

at times and places, take testimony, and receive evidence as the

Advisory Council considers appropriate. The Advisory Council may

administer oaths or affirmations to witnesses appearing before it.

(b) POWERS OF MEMBERS AND AGENTS.—Any member or agent

of the Advisory Council may, if authorized by the Advisory Council,

take any action which the Advisory Council is authorized to take

by this section.

(c) OBTAINING OFFICIAL DATA.—The Advisory Council may

secure directly from any department or agency of the United States

information necessary to enable it to carry out this part. Upon

request of the Chairperson of the Advisory Council, the head of

that department or agency shall furnish that information to the

Advisory Council.

SEC. 156. REPORTS.

(a) ANNUAL REPORTS.—The Advisory Council shall submit to

the Secretary an annual report for each fiscal year.

(b) INTERIM REPORTS.—The Advisory Council may submit to

the Secretary such interim reports as the Advisory Council considers

appropriate.

(c) FINAL REPORT.—The Advisory Council shall transmit a final

report to the Secretary not later September 30, 2003. The final

114 STAT. 2763A–624 PUBLIC LAW 106–554—APPENDIX G

report shall contain a detailed statement of the findings and conclusions of the Advisory Council, together with any recommendations

for legislative or administrative action that the Advisory Council

considers appropriate.

SEC. 157. TERMINATION.

(a) IN GENERAL.—The Advisory Council shall terminate 30

days after submitting its final report under section 156(c).

(b) EXTENSION.—Notwithstanding subsection (a), the Secretary

may postpone the termination of the Advisory Council for a period

not to exceed 3 years after the Advisory Council submits its final

report under section 156(c).

SEC. 158. APPLICABILITY OF FEDERAL ADVISORY COMMITTEE ACT.

The Federal Advisory Committee Act (5 U.S.C. App.) shall

not apply to the Advisory Council.

SEC. 159. RESOURCES.

The Secretary shall provide to the Advisory Council appropriate

resources so that the Advisory Council may carry out its duties

and fuctions under this part.

SEC. 160. EFFECTIVE DATE.

This part shall be effective 30 days after the date of its enactment.

Subtitle F—Other Provisions

SEC. 161. ACCELERATION OF PHASE-IN OF INCREASE IN VOLUME CAP

ON PRIVATE ACTIVITY BONDS.

(a) IN GENERAL.—Paragraphs (1) and (2) of section 146(d) (relating to State ceiling) are amended to read as follows:

‘‘(1) IN GENERAL.—The State ceiling applicable to any State

for any calendar year shall be the greater of—

‘‘(A) an amount equal to $75 ($62.50 in the case of

calendar year 2001) multiplied by the State population,

or

‘‘(B) $225,000,000 ($187,500,000 in the case of calendar

year 2001).

‘‘(2) COST-OF-LIVING ADJUSTMENT.—In the case of a calendar

year after 2002, each of the dollar amounts contained in paragraph (1) shall be increased by an amount equal to—

‘‘(A) such dollar amount, multiplied by

‘‘(B) the cost-of-living adjustment determined under

section 1(f )(3) for such calendar year by substituting ‘calendar year 2001’ for ‘calendar year 1992’ in subparagraph

(B) thereof.

If any increase determined under the preceding sentence is

not a multiple of $5 ($5,000 in the case of the dollar amount

in paragraph (1)(B)), such increase shall be rounded to the

nearest multiple thereof.’’.

(b) EFFECTIVE DATE.—The amendment made by this section

shall apply to calendar years after 2000.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–625

SEC. 162. MODIFICATIONS TO EXPENSING OF ENVIRONMENTAL

REMEDIATION COSTS.

(a) EXPENSING NOT LIMITED TO SITES IN TARGETED AREAS.—

Subsection (c) of section 198 is amended to read as follows:

‘‘(c) QUALIFIED CONTAMINATED SITE.—For purposes of this

section—

‘‘(1) IN GENERAL.—The term ‘qualified contaminated site’

means any area—

‘‘(A) which is held by the taxpayer for use in a trade

or business or for the production of income, or which is

property described in section 1221(a)(1) in the hands of

the taxpayer, and

‘‘(B) at or on which there has been a release (or threat

of release) or disposal of any hazardous substance.

‘‘(2) NATIONAL PRIORITIES LISTED SITES NOT INCLUDED.—

Such term shall not include any site which is on, or proposed

for, the national priorities list under section 105(a)(8)(B) of

the Comprehensive Environmental Response, Compensation,

and Liability Act of 1980 (as in effect on the date of the

enactment of this section).

‘‘(3) TAXPAYER MUST RECEIVE STATEMENT FROM STATE

ENVIRONMENTAL AGENCY.—An area shall be treated as a qualified contaminated site with respect to expenditures paid or

incurred during any taxable year only if the taxpayer receives

a statement from the appropriate agency of the State in which

such area is located that such area meets the requirement

of paragraph (1)(B).

‘‘(4) APPROPRIATE STATE AGENCY.—For purposes of paragraph (3), the chief executive officer of each State may, in

consultation with the Administrator of the Environmental

Protection Agency, designate the appropriate State environmental agency within 60 days of the date of the enactment

of this section. If the chief executive officer of a State has

not designated an appropriate environmental agency within

such 60-day period, the appropriate environmental agency for

such State shall be designated by the Administrator of the

Environmental Protection Agency.’’.

(b) EXTENSION OF TERMINATION DATE.—Subsection (h) of section 198 is amended by striking ‘‘2001’’ and inserting ‘‘2003’’.

(c) EFFECTIVE DATE.—The amendments made by this section

shall apply to expenditures paid or incurred after the date of the

enactment of this Act.

SEC. 163. EXTENSION OF DC HOMEBUYER TAX CREDIT.

Section 1400C(i) (relating to application of section) is amended

by striking ‘‘2002’’ and inserting ‘‘2004’’.

SEC. 164. EXTENSION OF DC ZONE THROUGH 2003.

(a) IN GENERAL.—The following provisions are amended by

striking ‘‘2002’’ each place it appears and inserting ‘‘2003’’:

(1) Section 1400(f ).

(2) Section 1400A(b).

(b) ZERO CAPITAL GAINS RATE.—Section 1400B (relating to zero

percent capital gains rate) is amended—

(1) by striking ‘‘2003’’ each place it appears and inserting

‘‘2004’’, and

114 STAT. 2763A–626 PUBLIC LAW 106–554—APPENDIX G

(2) by striking ‘‘2007’’ each place it appears and inserting ‘‘2008’’.

SEC. 165. EXTENSION OF ENHANCED DEDUCTION FOR CORPORATE

DONATIONS OF COMPUTER TECHNOLOGY.

(a) EXPANSION OF COMPUTER TECHNOLOGY DONATIONS TO PUB- LIC LIBRARIES.— (1) IN GENERAL.—Paragraph (6) of section 170(e) (relating

to special rule for contributions of computer technology and

equipment for elementary or secondary school purposes) is

amended by striking ‘‘qualified elementary or secondary educational contribution’’ each place it occurs in the headings and

text and inserting ‘‘qualified computer contribution’’.

(2) EXPANSION OF ELIGIBLE DONEES.—Clause (i) of section

170(e)(6)(B) (relating to qualified elementary or secondary educational contribution) is amended by striking ‘‘or’’ at the end

of subclause (I), by adding ‘‘or’’ at the end of subclause (II),

and by inserting after subclause (II) the following new subclause:

‘‘(III) a public library (within the meaning of

section 213(2)(A) of the Library Services and Technology Act (20 U.S.C. 9122(2)(A)), as in effect on

the date of the enactment of the Community

Renewal Tax Relief Act of 2000, established and

maintained by an entity described in subsection

(c)(1),’’.

(3) EXTENSION OF DONATION PERIOD.—Clause (ii) of section

170(e)(6)(B) is amended by striking ‘‘2 years’’ and inserting

‘‘3 years’’.

(b) CONFORMING AMENDMENTS.—

(1) Section 170(e)(6)(B)(iv) is amended by striking ‘‘in any

grades of the K–12’’.

(2) The heading of paragraph (6) of section 170(e) is amended by striking ‘‘ELEMENTARY OR SECONDARY SCHOOL PURPOSES’’

and inserting ‘‘EDUCATIONAL PURPOSES’’.

(c) EXTENSION OF DEDUCTION.—Section 170(e)(6)(F) (relating

to termination) is amended by striking ‘‘December 31, 2000’’ and

inserting ‘‘December 31, 2003’’.

(d) STANDARDS AS TO FUNCTIONALITY AND SUITABILITY.—

Subparagraph (B) of section 170(e)(6) is amended by striking ‘‘and’’

at the end of clause (vi), by striking the period at the end of

clause (vii) and inserting ‘‘, and’’, and by adding at the end the

following new clause:

‘‘(viii) the property meets such standards, if any,

as the Secretary may prescribe by regulation to assure

that the property meets minimum functionality and

suitability standards for educational purposes.’’.

(e) DONATIONS OF COMPUTERS REACQUIRED BY MANUFACTURER.—Paragraph (6) of section 170(e) is further amended by

redesignating subparagraphs (D), (E), and (F) as subparagraphs

(E), (F), and (G), respectively, and by inserting after subparagraph

(C) the following new subparagraph:

‘‘(D) DONATIONS OF PROPERTY REACQUIRED BY MANU- FACTURER.—In the case of property which is reacquired

by the person who constructed the property—

‘‘(i) subparagraph (B)(ii) shall be applied to a contribution of such property by such person by taking

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–627

into account the date that the original construction

of the property was substantially completed, and ‘‘(ii) subparagraph (B)(iii) shall not apply to such

contribution.’’.

(f ) EFFECTIVE DATE.—The amendments made by this section

shall apply to contributions made after December 31, 2000.

SEC. 166. TREATMENT OF INDIAN TRIBAL GOVERNMENTS UNDER FEDERAL UNEMPLOYMENT TAX ACT.

(a) IN GENERAL.—Section 3306(c)(7) (defining employment) is

amended—

(1) by inserting ‘‘or in the employ of an Indian tribe,’’ after ‘‘service performed in the employ of a State, or any political subdivision thereof,’’; and

(2) by inserting ‘‘or Indian tribes’’ after ‘‘wholly owned

by one or more States or political subdivisions’’. (b) PAYMENTS IN LIEU OF CONTRIBUTIONS.—Section 3309 (relating to State law coverage of services performed for nonprofit

organizations or governmental entities) is amended—

(1) in subsection (a)(2) by inserting ‘‘, including an Indian

tribe,’’ after ‘‘the State law shall provide that a governmental

entity’’;

(2) in subsection (b)(3)(B) by inserting ‘‘, or of an Indian

tribe’’ after ‘‘of a State or political subdivision thereof’’;

(3) in subsection (b)(3)(E) by inserting ‘‘or tribal’’ after

‘‘the State’’; and

(4) in subsection (b)(5) by inserting ‘‘or of an Indian tribe’’

after ‘‘an agency of a State or political subdivision thereof’’.

(c) STATE LAW COVERAGE.—Section 3309 (relating to State law

coverage of services performed for nonprofit organizations or governmental entities) is amended by adding at the end the following

new subsection:

‘‘(d) ELECTION BY INDIAN TRIBE.—The State law shall provide

that an Indian tribe may make contributions for employment as

if the employment is within the meaning of section 3306 or make

payments in lieu of contributions under this section, and shall

provide that an Indian tribe may make separate elections for itself

and each subdivision, subsidiary, or business enterprise wholly

owned by such Indian tribe. State law may require a tribe to

post a payment bond or take other reasonable measures to assure

the making of payments in lieu of contributions under this section.

Notwithstanding the requirements of section 3306(a)(6), if, within

90 days of having received a notice of delinquency, a tribe fails

to make contributions, payments in lieu of contributions, or payment

of penalties or interest (at amounts or rates comparable to those

applied to all other employers covered under the State law) assessed

with respect to such failure, or if the tribe fails to post a required

payment bond, then service for the tribe shall not be excepted

from employment under section 3306(c)(7) until any such failure

is corrected. This subsection shall apply to an Indian tribe within

the meaning of section 4(e) of the Indian Self-Determination and

Education Assistance Act (25 U.S.C. 450b(e)).’’.

(d) DEFINITIONS.—Section 3306 (relating to definitions) is

amended by adding at the end the following new subsection:

‘‘(u) INDIAN TRIBE.—For purposes of this chapter, the term ‘Indian tribe’ has the meaning given to such term by section 4(e)

of the Indian Self-Determination and Education Assistance Act

114 STAT. 2763A–628 PUBLIC LAW 106–554—APPENDIX G

(25 U.S.C. 450b(e)), and includes any subdivision, subsidiary, or

business enterprise wholly owned by such an Indian tribe.’’. (e) EFFECTIVE DATE; TRANSITION RULE.—

(1) EFFECTIVE DATE.—The amendments made by this section shall apply to service performed on or after the date

of the enactment of this Act.

(2) TRANSITION RULE.—For purposes of the Federal

Unemployment Tax Act, service performed in the employ of

an Indian tribe (as defined in section 3306(u) of the Internal

Revenue Code of 1986 (as added by this section)) shall not

be treated as employment (within the meaning of section 3306

of such Code) if— (A) it is service which is performed before the date

of the enactment of this Act and with respect to which

the tax imposed under the Federal Unemployment Tax

Act has not been paid, and

(B) such Indian tribe reimburses a State unemployment fund for unemployment benefits paid for service

attributable to such tribe for such period.

TITLE II—TWO-YEAR EXTENSION OF

AVAILABILITY OF MEDICAL SAVINGS

ACCOUNTS

SEC. 201. TWO-YEAR EXTENSION OF AVAILABILITY OF MEDICAL SAVINGS ACCOUNTS.

(a) IN GENERAL.—Paragraphs (2) and (3)(B) of section 220(i)

(defining cut-off year) are each amended by striking ‘‘2000’’ each

place it appears and inserting ‘‘2002’’.

(b) CONFORMING AMENDMENTS.—

(1) Paragraph (2) of section 220( j) is amended—

(A) by striking ‘‘1998 or 1999’’ each place it appears

and inserting ‘‘1998, 1999, or 2001’’,

(B) by striking ‘‘600,000 (750,000 in the case of 1999)’’

and inserting ‘‘750,000 (600,000 in the case of 1998)’’, and

(C) by inserting after subparagraph (B) the following

new subparagraph:

‘‘(C) NO LIMITATION FOR 2000.—The numerical limitation shall not apply for 2000.’’.

(2) Subparagraph (A) of section 220( j)(4) is amended by

striking ‘‘and 1999’’ and inserting ‘‘1999, and 2001’’.

(c) EFFECTIVE DATE.—The amendments made by this section

shall take effect on the date of the enactment of this Act.

SEC. 202. MEDICAL SAVINGS ACCOUNTS RENAMED AS ARCHER MSAS.

(a) IN GENERAL.—The following provisions are amended by

striking ‘‘medical savings account’’ each place it appears in the

text and inserting ‘‘Archer MSA’’:

(1) Section 26(b)(2)(Q).

(2) Section 106(b).

(3) Section 138(b).

(4) Section 220.

(5) Section 848(e)(1)(B)(iv).

(6) Subsections (a)(2) and (d) of section 4973.

(7) Subsections (c)(4) and (e)(1)(D) of section 4975.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–629

(8) Subsections (a) and (d)(2)(B) of section 4980E.

(9) Section 6051(a)(11).

(b) OTHER AMENDMENTS.— (1) Paragraph (16) of section 62(a) is amended to read

as follows: ‘‘(16) ARCHER MSAS.—The deduction allowed by section

220.’’.

(2) The following provisions are each amended by striking ‘‘medical savings accounts’’ each place it appears in the text

and inserting ‘‘Archer MSAs’’:

(A) Paragraphs (4) and (7) of section 106(b).

(B) Subsections (c)(1)(D), (e)(2), (f )(3)(A), (i)(4)(B), and

( j) of section 220.

(C) Section 4973(d).

(D) Subsections (b) and (d)(1) of section 4980E.

(E) Section 6693(a)(2)(B).

(3) Paragraph (1) of section 220(d) is amended by inserting ‘‘as a medical savings account’’ after ‘‘United States’’. (4) The heading for section 220(d) is amended by striking ‘‘MEDICAL SAVINGS ACCOUNT’’ and inserting ‘‘ARCHER MSA’’. (5) The headings for sections 220(d)(1) and 3231(e)(10) are

each amended by striking ‘‘MEDICAL SAVINGS ACCOUNT’’ and

inserting ‘‘ARCHER MSA’’.

(6) The headings for sections 106(b), 138(f ), 220(i), and

4973(d) are each amended by striking ‘‘MEDICAL SAVINGS

ACCOUNTS’’ and inserting ‘‘ARCHER MSAS’’.

(7) The headings for section 220(c)(1)(C) and 4975(c)(4)

are each amended by striking ‘‘MEDICAL SAVINGS ACCOUNTS’’

and inserting ‘‘ARCHER MSAS’’.

(8) The section heading for section 220 is amended to

read as follows:

‘‘SEC. 220. ARCHER MSAS.’’.

(9) The item relating to section 220 in the table of sections

for part VII of subchapter B of chapter 1 is amended to read

as follows:

‘‘Sec. 220. Archer MSAs.’’.

(10) The provisions amended by the preceding provisions

of this section are further amended by striking ‘‘a Archer’’ each place it appears and inserting ‘‘an Archer’’. (11) Section 220(e)(1) is further amended by striking ‘‘A

Archer’’ and inserting ‘‘An Archer’’.

TITLE III—ADMINISTRATIVE AND

TECHNICAL PROVISIONS

Subtitle A—Administrative Provisions

SEC. 301. EXEMPTION OF CERTAIN REPORTING REQUIREMENTS.

Section 3003(a)(1) of the Federal Reports Elimination and Sunset Act of 1995 (31 U.S.C. 1113 note) shall not apply to any report

required to be submitted under any of the following provisions

of law:

(1) Section 13031(f ) of the Consolidated Omnibus Budget

Reconciliation Act of 1985 (19 U.S.C. 58c(f )).

114 STAT. 2763A–630 PUBLIC LAW 106–554—APPENDIX G

(2) Section 16(c) of the Foreign Trade Zones Act (19 U.S.C.

81p(c)).

(3) The following provisions of the Tariff Act of 1930:

(A) Section 330(c)(1) (19 U.S.C. 1330(c)(1)).

(B) Section 607(c) (19 U.S.C. 1607(c)).

(4) Section 5 of the International Coffee Agreement Act

of 1980 (19 U.S.C. 1356n).

(5) Section 351(a)(2) of the Trade Expansion Act of 1962

(19 U.S.C. 1981(a)(2)).

(6) Section 502 of the Automotive Products Trade Act of

1965 (19 U.S.C. 2032).

(7) Section 3131 of the Customs Enforcement Act of 1986

(19 U.S.C. 2081).

(8) The following provisions of the Trade Act of 1974 (19

U.S.C. 2101 et seq.):

(A) Section 102(b)(4)(A)(ii)(I) (19 U.S.C.

2112(b)(4)(A)(ii)(I)).

(B) Section 102(e)(1) (19 U.S.C. 2112(e)(1)).

(C) Section 102(e)(2) (19 U.S.C. 2112(e)(2)).

(D) Section 104(d) (19 U.S.C. 2114(d)).

(E) Section 125(e) (19 U.S.C. 2135(e)).

(F) Section 135(e)(1) (19 U.S.C. 2155(e)(1)).

(G) Section 141(c) (19 U.S.C. 2171(c)).

(H) Section 162 (19 U.S.C. 2212).

(I) Section 163(b) (19 U.S.C. 2213(b)).

(J) Section 163(c) (19 U.S.C. 2213(c)).

(K) Section 203(b) (19 U.S.C. 2253(b)).

(L) Section 302(b)(2)(C) (19 U.S.C. 2412(b)(2)(C)).

(M) Section 303 (19 U.S.C. 2413).

(N) Section 309 (19 U.S.C. 2419).

(O) Section 407(a) (19 U.S.C. 2437(a)).

(P) Section 502(f ) (19 U.S.C. 2462(f )).

(Q) Section 504 (19 U.S.C. 2464).

(9) The following provisions of the Trade Agreements Act

of 1979 (19 U.S.C. 2501 et seq.):

(A) Section 2(b) (19 U.S.C. 2503(b)).

(B) Section 3(c) (19 U.S.C. 2504(c)).

(C) Section 305(c) (19 U.S.C. 2515(c)).

(10) Section 303(g)(1) of the Convention on Cultural Property Implementation Act (19 U.S.C. 2602(g)(1)).

(11) The following provisions of the Caribbean Basin Economic Recovery Act (19 U.S.C. 2701 et seq.):

(A) Section 212(a)(1)(A) (19 U.S.C. 2702(a)(1)(A)).

(B) Section 212(a)(2) (19 U.S.C. 2702(a)(2)).

(12) The following provisions of the Omnibus Trade and

Competitiveness Act of 1988 (19 U.S.C. 2901 et seq.):

(A) Section 1102 (19 U.S.C. 2902).

(B) Section 1103 (19 U.S.C. 2903).

(C) Section 1206(b) (19 U.S.C. 3006(b)).

(13) Section 123(a) of the Customs and Trade Act of 1990

(Public Law 101–382) (19 U.S.C. 2083).

(14) Section 243(b)(2) of the Caribbean Basin Economic

Recovery Expansion Act of 1990 (Public Law 101–382).

(15) The following provisions of the Internal Revenue Code

of 1986:

(A) Section 6103(p)(5).

(B) Section 7608.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–631

(C) Section 7802(f )(3).

(D) Section 8022(3).

(E) Section 9602(a).

(16) The following provisions relating to the revenue laws

of the United States:

(A) Section 1552(c) of the Tax Reform Act of 1986

(100 Stat. 2753).

(B) Section 231 of the Deficit Reduction Act of 1984

(26 U.S.C. 801 note).

(C) Section 208 of the Tax Treatment Extension Act

of 1977 (26 U.S.C. 911 note).

(D) Section 7105 of the Technical and Miscellaneous

Revenue Act of 1988 (45 U.S.C. 369).

(17) Section 4008 of the Employee Retirement Income Security Act of 1974 (29 U.S.C. 1308).

(18) Section 426 of the Black Lung Benefits Act (30 U.S.C.

936(b)).

(19) Section 7502(g) of title 31, United States Code.

(20) The following provisions of the Social Security Act:

(A) Section 215(i)(2)(C)(i) (42 U.S.C. 415(i)(2)(C)(i)).

(B) Section 221(i)(2) (42 U.S.C. 421(i)(2)).

(C) Section 221(i)(3) (42 U.S.C. 421(i)(3)).

(D) Section 233(e)(1) (42 U.S.C. 433(e)(1)).

(E) Section 452(a)(10) (42 U.S.C. 652(a)(10)).

(F) Section 452(g)(3)(B) (42 U.S.C. 652(g)(3)(B)).

(G) Section 506(a)(1) (42 U.S.C. 706(a)).

(H) Section 908 (42 U.S.C. 1108).

(I) Section 1114(f ) (42 U.S.C. 1314(f )).

(J) Section 1120 (42 U.S.C. 1320).

(K) Section 1161 (42 U.S.C. 1320c–10).

(L) Section 1875(b) (42 U.S.C. 1395ll(b)).

(M) Section 1881 (42 U.S.C. 1395rr).

(N) Section 1882 (42 U.S.C. 1395ss(f )(2)).

(21) Section 104(b) of the Social Security Independence

and Program Improvements Act of 1994 (42 USC 904 note).

(22) Section 10 of the Railroad Retirement Act of 1937

(45 U.S.C. 231f ).

(23) The following provisions of the Railroad Retirement

Act of 1974:

(A) Section 22(a)(1) (45 U.S.C. 231u(a)(1)).

(B) Section 22(b)(1) (45 U.S.C. 231u(b)(1)).

(24) Section 502 of the Railroad Retirement Solvency Act

of 1983 (45 U.S.C. 231f-1).

(25) Section 47121(c) of title 49, United States Code.

(26) The following provisions of the Omnibus Budget Reconciliation Act of 1987 (Public Law 100–203; 101 Stat. 1330-

182):

(A) Section 4007(c)(4) (42 U.S.C. 1395ww note).

(B) Section 4079 (42 U.S.C. 1395mm note).

(C) Section 4205 (42 U.S.C. 1395i–3 note).

(D) Section 4215 (42 U.S.C. 1396r note).

(27) The following provisions of the Inspector General Act

of 1978 (Public Law 95–452):

(A) Section 5(b).

(B) Section 5(d).

(28) The following provisions of the Public Health Service

Act:

114 STAT. 2763A–632 PUBLIC LAW 106–554—APPENDIX G

(A) In section 308(a) (42 U.S.C. 242m(a)), subparagraphs (A), (B), (C), and (D) of paragraph (1).

(B) Section 403 (42 U.S.C. 283).

(29) Section 404 of the Health Services and Centers Amendments of 1978 (42 U.S.C. 242p) (Public Law 95–626).

(30) The following provisions of the Older Americans Act

of 1965:

(A) Section 206(d) (42 U.S.C. 3017(d)).

(B) Section 207 (42 U.S.C. 3018).

(31) Section 308 of the Age Discrimination Act of 1975

(42 U.S.C. 6106a(b)).

(32) Section 509(c)(3) of the Americans with Disabilities

Act 0f 1990 (42 U.S.C. 12209(c)(3)).

(33) Section 4207(f ) of the Omnibus Budget Reconciliation

Act of 1990 (42 U.S.C. 1395b–1 note).

SEC. 302. EXTENSION OF DEADLINES FOR IRS COMPLIANCE WITH CERTAIN NOTICE REQUIREMENTS.

(a) ANNUAL INSTALLMENT AGREEMENT NOTICE.—Section 3506

of the Internal Revenue Service Restructuring and Reform Act

of 1998 is amended by striking ‘‘July 1, 2000’’ and inserting

‘‘September 1, 2001’’.

(b) NOTICE REQUIREMENTS RELATING TO COMPUTATION OF PENALTY.—Subsection (c) of section 3306 of the Internal Revenue Service Restructuring and Reform Act of 1998 is amended—

(1) by striking ‘‘December 31, 2000’’ and inserting ‘‘June

30, 2001’’, and

(2) by adding at the end the following: ‘‘In the case of

any notice of penalty issued after June 30, 2001, and before

July 1, 2003, the requirements of section 6751(a) of the Internal

Revenue Code of 1986 shall be treated as met if such notice

contains a telephone number at which the taxpayer can request

a copy of the taxpayer’s assessment and payment history with

respect to such penalty.’’.

(c) NOTICE REQUIREMENTS RELATING TO INTEREST IMPOSED.—

Subsection (c) of section 3308 of the Internal Revenue Service

Restructuring and Reform Act of 1998 is amended—

(1) by striking ‘‘December 31, 2000’’ and inserting ‘‘June

30, 2001’’, and

(2) by adding at the end the following: ‘‘In the case of

any notice issued after June 30, 2001, and before July 1,

2003, to which section 6631 of the Internal Revenue Code

of 1986 applies, the requirements of section 6631 of such Code

shall be treated as met if such notice contains a telephone

number at which the taxpayer can request a copy of the taxpayer’s payment history relating to interest amounts included

in such notice.’’.

SEC. 303. EXTENSION OF AUTHORITY FOR UNDERCOVER OPERATIONS.

Paragraph (6), and the last sentence, of section 7608(c) are

each amended by striking ‘‘January 1, 2001’’ and inserting ‘‘January

1, 2006’’.

SEC. 304. CONFIDENTIALITY OF CERTAIN DOCUMENTS RELATING TO

CLOSING AND SIMILAR AGREEMENTS AND TO AGREEMENTS WITH FOREIGN GOVERNMENTS.

(a) CLOSING AND SIMILAR AGREEMENTS TREATED AS RETURN

INFORMATION.—Paragraph (2) of section 6103(b) (defining return

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–633

information) is amended by striking ‘‘and’’ at the end of subparagraph (B), by inserting ‘‘and’’ at the end of subparagraph (C),

and by inserting after subparagraph (C) the following new subparagraph:

‘‘(D) any agreement under section 7121, and any similar agreement, and any background information related

to such an agreement or request for such an agreement,’’.

(b) AGREEMENTS WITH FOREIGN GOVERNMENTS.—

(1) IN GENERAL.—Subchapter B of chapter 61 (relating to

miscellaneous provisions) is amended by inserting after section

6104 the following new section:

‘‘SEC. 6105. CONFIDENTIALITY OF INFORMATION ARISING UNDER

TREATY OBLIGATIONS.

‘‘(a) IN GENERAL.—Tax convention information shall not be

disclosed.

‘‘(b) EXCEPTIONS.—Subsection (a) shall not apply—

‘‘(1) to the disclosure of tax convention information to persons or authorities (including courts and administrative bodies)

which are entitled to such disclosure pursuant to a tax convention,

‘‘(2) to any generally applicable procedural rules regarding

applications for relief under a tax convention, or

‘‘(3) in any case not described in paragraphs (1) or (2),

to the disclosure of any tax convention information not relating

to a particular taxpayer if the Secretary determines, after consultation with each other party to the tax convention, that

such disclosure would not impair tax administration.

‘‘(c) DEFINITIONS.—For purposes of this section—

‘‘(1) TAX CONVENTION INFORMATION.—The term ‘tax convention information’ means any—

‘‘(A) agreement entered into with the competent

authority of one or more foreign governments pursuant

to a tax convention,

‘‘(B) application for relief under a tax convention,

‘‘(C) any background information related to such agreement or application,

‘‘(D) document implementing such agreement, and

‘‘(E) any other information exchanged pursuant to a

tax convention which is treated as confidential or secret

under the tax convention.

‘‘(2) TAX CONVENTION.—The term ‘tax convention’ means—

‘‘(A) any income tax or gift and estate tax convention,

or

‘‘(B) any other convention or bilateral agreement

(including multilateral conventions and agreements and

any agreement with a possession of the United States)

providing for the avoidance of double taxation, the prevention of fiscal evasion, nondiscrimination with respect to

taxes, the exchange of tax relevant information with the

United States, or mutual assistance in tax matters.

114 STAT. 2763A–634 PUBLIC LAW 106–554—APPENDIX G

‘‘(d) CROSS REFERENCES.—

‘‘For penalties for the unauthorized disclosure of tax convention

information which is return or return information, see sections

7213, 7213A, and 7431.’’.

(2) CLERICAL AMENDMENT.—The table of sections for subchapter B of chapter 61 is amended by inserting after the

item relating to section 6104 the following new item:

‘‘Sec. 6105. Confidentiality of information arising under treaty obligations.’’.

(c) EXCEPTION FROM PUBLIC INSPECTION AS WRITTEN DETER- MINATION.—

(1) CLOSING AND SIMILAR AGREEMENTS.—Paragraph (1) of

section 6110(b) is amended to read as follows: ‘‘(1) WRITTEN DETERMINATION.— ‘‘(A) IN GENERAL.—The term ‘written determination’ means a ruling, determination letter, technical advice

memorandum, or Chief Counsel advice. ‘‘(B) EXCEPTIONS.—Such term shall not include any

matter referred to in subparagraph (C) or (D) of section

6103(b)(2).’’. (2) AGREEMENTS WITH FOREIGN GOVERNMENTS.—Paragraph

(1) of section 6110(l) is amended by inserting ‘‘or 6105’’ after ‘‘6104’’. (d) EFFECTIVE DATE.—The amendments made by this section

shall take effect on the date of the enactment of this Act.

SEC. 305. INCREASE IN THRESHOLD FOR JOINT COMMITTEE REPORTS

ON REFUNDS AND CREDITS.

(a) GENERAL RULE.—Subsections (a) and (b) of section 6405

are each amended by striking ‘‘$1,000,000’’ and inserting ‘‘$2,000,000’’. (b) EFFECTIVE DATE.—The amendment made by subsection (a)

shall take effect on the date of the enactment of this Act, except

that such amendment shall not apply with respect to any refund

or credit with respect to a report that has been made before such

date of the enactment under section 6405 of the Internal Revenue

Code of 1986.

SEC. 306. TREATMENT OF MISSING CHILDREN WITH RESPECT TO CERTAIN TAX BENEFITS.

(a) IN GENERAL.—Subsection (c) of section 151 (relating to

additional exemption for dependents) is amended by adding at

the end the following new paragraph: ‘‘(6) TREATMENT OF MISSING CHILDREN.— ‘‘(A) IN GENERAL.—Solely for the purposes referred to

in subparagraph (B), a child of the taxpayer— ‘‘(i) who is presumed by law enforcement authorities to have been kidnapped by someone who is not

a member of the family of such child or the taxpayer,

and

‘‘(ii) who was (without regard to this paragraph)

the dependent of the taxpayer for the portion of the

taxable year before the date of the kidnapping,

shall be treated as a dependent of the taxpayer for all

taxable years ending during the period that the child is

kidnapped. ‘‘(B) PURPOSES.—Subparagraph (A) shall apply solely

for purposes of determining—

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–635

‘‘(i) the deduction under this section,

‘‘(ii) the credit under section 24 (relating to child

tax credit), and ‘‘(iii) whether an individual is a surviving spouse

or a head of a household (such terms are defined

in section 2).

‘‘(C) COMPARABLE TREATMENT FOR EARNED INCOME

CREDIT.—For purposes of section 32, an individual— ‘‘(i) who is presumed by law enforcement authorities to have been kidnapped by someone who is not

a member of the family of such individual or the taxpayer, and ‘‘(ii) who had, for the taxable year in which the

kidnapping occurred, the same principal place of abode

as the taxpayer for more than one-half of the portion

of such year before the date of the kidnapping,

shall be treated as meeting the requirement of section

32(c)(3)(A)(ii) with respect to a taxpayer for all taxable

years ending during the period that the individual is kidnapped. ‘‘(D) TERMINATION OF TREATMENT.—Subparagraphs (A)

and (C) shall cease to apply as of the first taxable year

of the taxpayer beginning after the calendar year in which

there is a determination that the child is dead (or, if

earlier, in which the child would have attained age 18).’’.

(b) EFFECTIVE DATE.—The amendment made by this section

shall apply to taxable years ending after the date of the enactment

of this Act.

SEC. 307. AMENDMENTS TO STATUTES REFERENCING YIELD ON 52-

WEEK TREASURY BILLS.

(a) AMENDMENT TO THE ACT OF FEBRUARY 26, 1931.—Section

6 of the Act of February 26, 1931 (40 U.S.C. 258e–1) (relating

to the interest rate on compensation owed for takings of property)

is amended— (1) in paragraph (1), by striking ‘‘the coupon issue yield

equivalent (as determined by the Secretary of the Treasury)

of the average accepted auction price for the last auction of

52 week United States Treasury bills settled immediately

before’’ and inserting ‘‘the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors

of the Federal Reserve System, for the calendar week

preceding’’; and

(2) in paragraph (2), by striking ‘‘the coupon issue yield

equivalent (as determined by the Secretary of the Treasury)

of the average accepted auction price for the last auction of

52 week United States Treasury bills settled immediately

before’’ and inserting ‘‘the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors

of the Federal Reserve System, for the calendar week

preceding’’.

(b) AMENDMENT TO TITLE 18, UNITED STATES CODE.—Section

3612(f )(2)(B) of title 18, United States Code (relating to the interest

rate on unpaid criminal fines and penalties of more than $2,500)

is amended by striking ‘‘the coupon issue yield equivalent (as determined by the Secretary of the Treasury) of the average accepted

auction price for the last auction of fifty-two week United States

114 STAT. 2763A–636 PUBLIC LAW 106–554—APPENDIX G

Treasury bills settled before’’ and inserting ‘the weekly average

1-year constant maturity Treasury yield, as published by the Board

of Governors of the Federal Reserve System, for the calendar week

preceding.’’.

(c) AMENDMENT TO THE INTERNAL REVENUE CODE.—Section

995(f )(4) (relating to the interest rate on tax-deferred liability of

shareholders of domestic international sales corporations) is amended by striking ‘‘the average investment yield of United States Treasury bills with maturities of 52 weeks which were auctioned during

the 1-year period’’ and inserting ‘‘the average of the 1-year constant

maturity Treasury yields, as published by the Board of Governors

of the Federal Reserve System, for the 1-year period’’. (d) AMENDMENTS TO TITLE 28, UNITED STATES CODE.— (1) AMENDMENT TO SECTION 1961.—Section 1961(a) of title

28, United States Code (relating to the interest rate on money

judgments in civil cases recovered in Federal district court)

is amended by striking ‘‘the coupon issue yield equivalent (as

determined by the Secretary of the Treasury) of the average

accepted auction price for the last auction of fifty-two week

United States Treasury bills settled immediately prior to’’ and

inserting ‘‘the weekly average 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal

Reserve System, for the calendar week preceding.’’. (2) AMENDMENT TO SECTION 2516.—Section 2516(b) of title

28, United States Code (relating to the interest rate on a

judgment against the United States affirmed by the Supreme

Court after review on petition of the United States) is amended

by striking ‘‘the coupon issue yield equivalent (as determined

by the Secretary of the Treasury) of the average accepted

auction price for the last auction of fifty-two week United

States Treasury bills settled immediately before’’ and inserting

‘‘the weekly average 1-year constant maturity Treasury yield,

as published by the Board of Governors of the Federal Reserve

System, for the calendar week preceding’’.

SEC. 308. ADJUSTMENTS FOR CONSUMER PRICE INDEX ERROR.

(a) DETERMINATIONS BY OMB.—As soon as practicable after

the date of the enactment of this Act, the Director of the Office

of Management and Budget shall determine with respect to each

applicable Federal benefit program whether the CPI computation

error for 1999 has or will result in a shortfall in payments to

beneficiaries under such program (as compared to payments that

would have been made if the error had not occurred). As soon

as practicable after the date of the enactment of this Act, but

not later than 60 days after such date, the Director shall direct

the head of the Federal agency which administers such program

to make a payment or payments that, insofar as the Director

finds practicable and feasible—

(1) are targeted to the amount of the shortfall experienced

by individual beneficiaries, and

(2) compensate for the shortfall.

(b) COORDINATION WITH FEDERAL AGENCIES.—As soon as practicable after the date of the enactment of this Act, each Federal

agency that administers an applicable Federal benefit program

shall, in accordance with such guidelines as are issued by the

Director pursuant to this section, make an initial determination

of whether, and the extent to which, the CPI computation error

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–637

for 1999 has or will result in a shortfall in payments to beneficiaries

of an applicable Federal benefit program administered by such

agency. Not later than 30 days after such date, the head of such

agency shall submit a report to the Director and to each House

of the Congress of such determination, together with a complete

description of the nature of the shortfall.

(c) IMPLEMENTATION PURSUANT TO AGENCY REPORTS.—Upon

receipt of the report submitted by a Federal agency pursuant to

subsection (b), the Director shall review the initial determination

of the agency, the agency’s description of the nature of the shortfall,

and the compensation payments proposed by the agency. Prior

to directing payment of such payments pursuant to subsection

(a), the Director shall make appropriate adjustments (if any) in

the compensation payments proposed by the agency that the Director determines are necessary to comply with the requirements of

subsection (a) and transmit to the agency a summary report of

the review, indicating any adjustments made by the Director. The

agency shall make the compensation payments as directed by the

Director pursuant to subsection (a) in accordance with the Director’s

summary report.

(d) INCOME DISREGARD UNDER FEDERAL MEANS-TESTED BENEFIT PROGRAMS.—A payment made under this section to compensate

for a shortfall in benefits shall, in accordance with guidelines issued

by the Director pursuant to this section, be disregarded in determining income under title VIII of the Social Security Act or any

applicable Federal benefit program that is means-tested.

(e) FUNDING.—Funds otherwise available under each applicable

Federal benefit program for making benefit payments under such

program are hereby made available for making compensation payments under this section in connection with such program.

(f ) NO JUDICIAL REVIEW.—No action taken pursuant to this

section shall be subject to judicial review.

(g) DIRECTOR’S REPORT.—Not later than April 1, 2001, the

Director shall submit to each House of the Congress a report on

the activities performed by the Director pursuant to this section.

(h) DEFINITIONS.—For purposes of this section:

(1) APPLICABLE FEDERAL BENEFIT PROGRAM.—The term

‘‘applicable Federal benefit program’’ means any program of

the Government of the United States providing for regular

or periodic payments or cash assistance paid directly to individual beneficiaries, as determined by the Director of the Office

of Management and Budget.

(2) FEDERAL AGENCY.—The term ‘‘Federal agency’’ means

a department, agency, or instrumentality of the Government

of the United States.

(3) CPI COMPUTATION ERROR FOR 1999.—The term ‘‘CPI

computation error for 1999’’ means the error in the computation

of the Consumer Price Index announced by the Bureau of

Labor Statistics on September 28, 2000.

(i) TAX PROVISIONS.—In the case of taxable years (and other

periods) beginning after December 31, 2000, if any Consumer Price

Index (as defined in section 1(f )(5) of the Internal Revenue Code

of 1986) reflects the CPI computation error for 1999—

(1) the correct amount of such Index shall (in such manner

and to such extent as the Secretary of the Treasury determines

to be appropriate) be taken into account for purposes of such

Code, and

114 STAT. 2763A–638 PUBLIC LAW 106–554—APPENDIX G

(2) tables prescribed under section 1(f ) of such Code to

reflect such correct amount shall apply in lieu of any tables

that were prescribed based on the erroneous amount.

SEC. 309. PREVENTION OF DUPLICATION OF LOSS THROUGH ASSUMPTION OF LIABILITIES GIVING RISE TO A DEDUCTION.

(a) IN GENERAL.—Section 358 (relating to basis to distributees)

is amended by adding at the end the following new subsection: ‘‘(h) SPECIAL RULES FOR ASSUMPTION OF LIABILITIES TO WHICH

SUBSECTION (d) DOES NOT APPLY.— ‘‘(1) IN GENERAL.—If, after application of the other provisions of this section to an exchange or series of exchanges,

the basis of property to which subsection (a)(1) applies exceeds

the fair market value of such property, then such basis shall

be reduced (but not below such fair market value) by the

amount (determined as of the date of the exchange) of any

liability—

‘‘(A) which is assumed in exchange for such property,

and ‘‘(B) with respect to which subsection (d)(1) does not

apply to the assumption.

‘‘(2) EXCEPTIONS.—Except as provided by the Secretary,

paragraph (1) shall not apply to any liability if— ‘‘(A) the trade or business with which the liability

is associated is transferred to the person assuming the

liability as part of the exchange, or ‘‘(B) substantially all of the assets with which the

liability is associated are transferred to the person assuming the liability as part of the exchange.

‘‘(3) LIABILITY.—For purposes of this subsection, the term ‘liability’ shall include any fixed or contingent obligation to

make payment, without regard to whether the obligation is

otherwise taken into account for purposes of this title.’’. (b) DETERMINATION OF AMOUNT OF LIABILITY ASSUMED.—Section 357(d)(1) is amended by inserting ‘‘section 358(h),’’ after ‘‘section

358(d),’’. (c) APPLICATION OF COMPARABLE RULES TO PARTNERSHIPS AND

S CORPORATIONS.—The Secretary of the Treasury or his delegate— (1) shall prescribe rules which provide appropriate adjustments under subchapter K of chapter 1 of the Internal Revenue

Code of 1986 to prevent the acceleration or duplication of losses

through the assumption of (or transfer of assets subject to)

liabilities described in section 358(h)(3) of such Code (as added

by subsection (a)) in transactions involving partnerships, and

(2) may prescribe rules which provide appropriate adjustments under subchapter S of chapter 1 of such Code in transactions described in paragraph (1) involving S corporations

rather than partnerships.

(d) EFFECTIVE DATES.—

(1) IN GENERAL.—The amendments made by this section

shall apply to assumptions of liability after October 18, 1999.

(2) RULES.—The rules prescribed under subsection (c) shall

apply to assumptions of liability after October 18, 1999, or

such later date as may be prescribed in such rules.

SEC. 310. DISCLOSURE OF CERTAIN INFORMATION TO CONGRESSIONAL BUDGET OFFICE.

(a) DISCLOSURE OF CERTAIN TAX INFORMATION.—

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–639

(1) IN GENERAL.—Subsection ( j) of section 6103 (relating

to statistical use) is amended by adding at the end the following

new paragraph:

‘‘(6) CONGRESSIONAL BUDGET OFFICE.—Upon written

request by the Director of the Congressional Budget Office,

the Secretary shall furnish to officers and employees of the

Congressional Budget Office return information for the purpose

of, but only to the extent necessary for, long-term models of

the social security and medicare programs.’’.

(2) RECORDKEEPING SAFEGUARDS.—Section 6103(p) is

amended—

(A) in paragraph (4)—

(i) in the matter preceding subparagraph (A), by

inserting ‘‘the Congressional Budget Office,’’ after

‘‘General Accounting Office,’’,

(ii) in subparagraph (E), by striking ‘‘commission

or the General Accounting Office’’ and inserting

‘‘commission, the General Accounting Office, or the

Congressional Budget Office’’,

(iii) in subparagraph (F)(ii), by striking ‘‘or the

General Accounting Office,’’ and inserting ‘‘the General

Accounting Office, or the Congressional Budget Office,’’,

and

(iv) in the matter following subparagraph (F), by

inserting ‘‘or the Congressional Budget Office’’ after

‘‘General Accounting Office’’ both places it appears,

(B) in paragraph (5), by striking ‘‘commissions and

the General Accounting Office’’ and inserting ‘‘commissions,

the General Accounting Office, and the Congressional

Budget Office’’, and

(C) in paragraph (6)(A), by inserting ‘‘and the Congressional Budget Office’’ after ‘‘commissions’’.

(b) CONFIDENTIALITY OF RECORDS.—

(1) IN GENERAL.—Section 203 of the Congressional Budget

Act of 1974 (2 U.S.C. 603) is amended by adding at the end

the following:

‘‘(e) LEVEL OF CONFIDENTIALITY.—With respect to information,

data, estimates, and statistics obtained under sections 201(d) and

201(e), the Director shall maintain the same level of confidentiality

as is required by law of the department, agency, establishment,

or regulatory agency or commission from which it is obtained.

Officers and employees of the Congressional Budget Office shall

be subject to the same statutory penalties for unauthorized disclosure or use as officers or employees of the department, agency,

establishment, or regulatory agency or commission from which it

is obtained.’’. (2) CONFORMING AMENDMENT.—Subsection (a) of section

203 of such Act is amended by striking ‘‘subsections (c) and

(d)’’ and inserting ‘‘subsections (c), (d), and (e)’’.

Subtitle B—Technical Corrections

SEC. 311. AMENDMENTS RELATED TO TICKET TO WORK AND WORK

INCENTIVES IMPROVEMENT ACT OF 1999.

(a) AMENDMENTS RELATED TO SECTION 502 OF THE ACT.—

114 STAT. 2763A–640 PUBLIC LAW 106–554—APPENDIX G

(1) Section 280C(c)(1) is amended by striking ‘‘or credit’’

after ‘‘deduction’’ each place it appears.

(2) Section 30A is amended by redesignating subsections

(f ) and (g) as subsections (g) and (h), respectively, and by

inserting after subsection (e) the following new subsection:

‘‘(f ) DENIAL OF DOUBLE BENEFIT.—Any wages or other expenses

taken into account in determining the credit under this section

may not be taken into account in determining the credit under

section 41.’’.

(b) AMENDMENT RELATED TO SECTION 545 OF THE ACT.—Clause

(ii) of section 857(b)(7)(B) is amended to read as follows:

‘‘(ii) EXCEPTION FOR CERTAIN AMOUNTS.—Clause (i)

shall not apply to amounts received directly or

indirectly by a real estate investment trust—

‘‘(I) for services furnished or rendered by a

taxable REIT subsidiary that are described in

paragraph (1)(B) of section 856(d), or

‘‘(II) from a taxable REIT subsidiary that are

described in paragraph (7)(C)(ii) of such section.’’.

(c) CLARIFICATION RELATED TO SECTION 538 OF THE ACT.—

The reference to section 332(b)(1) of the Internal Revenue Code

of 1986 in Treasury Regulation section 1.1502-34 shall be deemed

to include a reference to section 732(f ) of such Code.

(d) EFFECTIVE DATE.—Subsection (c) and the amendments made

by this section shall take effect as if included in the provisions

of the Ticket to Work and Work Incentives Improvement Act of

1999 to which they relate.

SEC. 312. AMENDMENTS RELATED TO TAX AND TRADE RELIEF EXTENSION ACT OF 1998.

(a) AMENDMENT RELATED TO SECTION 1004(b) OF THE ACT.—

Subsection (d) of section 6104 is amended by adding at the end

the following new paragraph:

‘‘(6) APPLICATION TO NONEXEMPT CHARITABLE TRUSTS AND

NONEXEMPT PRIVATE FOUNDATIONS.—The organizations referred

to in paragraphs (1) and (2) of section 6033(d) shall comply

with the requirements of this subsection relating to annual

returns filed under section 6033 in the same manner as the

organizations referred to in paragraph (1).’’.

(b) AMENDMENT RELATED TO SECTION 4003 OF THE ACT.—

Subsection (b) of section 4003 of the Tax and Trade Relief Extension

Act of 1998 is amended by inserting ‘‘(7)(A)(i)(II),’’ after

‘‘(5)(A)(ii)(I),’’.

(c) EFFECTIVE DATE.—The amendments made by this section

shall take effect as if included in the provisions of the Tax and

Trade Relief Extension Act of 1998 to which they relate.

SEC. 313. AMENDMENTS RELATED TO INTERNAL REVENUE SERVICE

RESTRUCTURING AND REFORM ACT OF 1998.

(a) AMENDMENTS RELATED TO INNOCENT SPOUSE RELIEF.—

(1) ELECTION MAY BE MADE ANY TIME AFTER DEFICIENCY

ASSERTED.—Subparagraph (B) of section 6015(c)(3) is amended

by striking ‘‘shall be made’’ and inserting ‘‘may be made at

any time after a deficiency for such year is asserted but’’.

(2) CLARIFICATION REGARDING DISALLOWANCE OF REFUNDS

AND CREDITS UNDER SECTION 6015(c).—

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–641

(A) IN GENERAL.—Section 6015 is amended by

redesignating subsection (g) as subsection (h) and by inserting after subsection (f ) the following new subsection: ‘‘(g) CREDITS AND REFUNDS.— ‘‘(1) IN GENERAL.—Except as provided in paragraphs (2)

and (3), notwithstanding any other law or rule of law (other

than section 6511, 6512(b), 7121, or 7122), credit or refund

shall be allowed or made to the extent attributable to the

application of this section. ‘‘(2) RES JUDICATA.—In the case of any election under subsection (b) or (c), if a decision of a court in any prior proceeding

for the same taxable year has become final, such decision

shall be conclusive except with respect to the qualification

of the individual for relief which was not an issue in such

proceeding. The exception contained in the preceding sentence

shall not apply if the court determines that the individual

participated meaningfully in such prior proceeding. ‘‘(3) CREDIT AND REFUND NOT ALLOWED UNDER SUBSECTION

(c).—No credit or refund shall be allowed as a result of an

election under subsection (c).’’.

(B) CONFORMING AMENDMENT.—Paragraph (3) of section 6015(e) is amended to read as follows:

‘‘(3) LIMITATION ON TAX COURT JURISDICTION.—If a suit

for refund is begun by either individual filing the joint return

pursuant to section 6532—

‘‘(A) the Tax Court shall lose jurisdiction of the individual’s action under this section to whatever extent jurisdiction is acquired by the district court or the United States

Court of Federal Claims over the taxable years that are

the subject of the suit for refund, and

‘‘(B) the court acquiring jurisdiction shall have jurisdiction over the petition filed under this subsection.’’.

(3) CLARIFICATIONS REGARDING REVIEW BY TAX COURT.—

(A) Paragraph (1) of section 6015(e) is amended in

the matter preceding subparagraph (A) by inserting after

‘‘individual’’ the following: ‘‘against whom a deficiency has

been asserted and’’.

(B) Subparagraph (A) of section 6015(e)(1) is amended

to read as follows:

‘‘(A) IN GENERAL.—In addition to any other remedy

provided by law, the individual may petition the Tax Court

(and the Tax Court shall have jurisdiction) to determine

the appropriate relief available to the individual under

this section if such petition is filed—

‘‘(i) at any time after the earlier of—

‘‘(I) the date the Secretary mails, by certified

or registered mail to the taxpayer’s last known

address, notice of the Secretary’s final determination of relief available to the individual, or

‘‘(II) the date which is 6 months after the

date such election is filed with the Secretary, and

‘‘(ii) not later than the close of the 90th day after

the date described in clause (i)(I).’’.

(C) Subparagraph (B)(i) of section 6015(e)(1) is

amended—

(i) by striking ‘‘until the expiration of the 90-day

period described in subparagraph (A)’’ and inserting

114 STAT. 2763A–642 PUBLIC LAW 106–554—APPENDIX G

‘‘until the close of the 90th day referred to in subparagraph (A)(ii)’’, and

(ii) by inserting ‘‘under subparagraph (A)’’ after

‘‘filed with the Tax Court’’.

(D)(i) Subsection (e) of section 6015 is amended by

adding at the end the following new paragraph:

‘‘(5) WAIVER.—An individual who elects the application of

subsection (b) or (c) (and who agrees with the Secretary’s determination of relief ) may waive in writing at any time the restrictions in paragraph (1)(B) with respect to collection of the

outstanding assessment (whether or not a notice of the Secretary’s final determination of relief has been mailed).’’.

(ii) Paragraph (2) of section 6015(e) is amended to

read as follows:

‘‘(2) SUSPENSION OF RUNNING OF PERIOD OF LIMITATIONS.—

The running of the period of limitations in section 6502 on

the collection of the assessment to which the petition under

paragraph (1)(A) relates shall be suspended—

‘‘(A) for the period during which the Secretary is

prohibited by paragraph (1)(B) from collecting by levy or

a proceeding in court and for 60 days thereafter, and

‘‘(B) if a waiver under paragraph (5) is made, from

the date the claim for relief was filed until 60 days after

the waiver is filed with the Secretary.’’.

(b) AMENDMENTS RELATED TO PROCEDURE AND ADMINISTRATION.—

(1) DISPUTES INVOLVING $50,000 OR LESS.—Section 7463

is amended by adding at the end the following new subsection:

‘‘(f ) ADDITIONAL CASES IN WHICH PROCEEDINGS MAY BE CONDUCTED UNDER THIS SECTION.—At the option of the taxpayer concurred in by the Tax Court or a division thereof before the hearing

of the case, proceedings may be conducted under this section (in

the same manner as a case described in subsection (a)) in the

case of—

‘‘(1) a petition to the Tax Court under section 6015(e)

in which the amount of relief sought does not exceed $50,000,

and

‘‘(2) an appeal under section 6330(d)(1)(A) to the Tax Court

of a determination in which the unpaid tax does not exceed

$50,000.’’.

(2) AUTHORITY TO ENJOIN COLLECTION ACTIONS.—

(A) Section 6330(e)(1) is amended by adding at the

end the following: ‘‘Notwithstanding the provisions of section 7421(a), the beginning of a levy or proceeding during

the time the suspension under this paragraph is in force

may be enjoined by a proceeding in the proper court, including the Tax Court. The Tax Court shall have no jurisdiction

under this paragraph to enjoin any action or proceeding

unless a timely appeal has been filed under subsection

(d)(1) and then only in respect of the unpaid tax or proposed

levy to which the determination being appealed relates.’’.

(B) Section 7421(a) is amended by inserting

‘‘6330(e)(1),’’ after ‘‘6246(b),’’.

(3) CLARIFICATION.—Paragraph (3) of section 6331(k) is

amended by striking ‘‘(3), (4), and (5)’’ and inserting ‘‘(3) and

(4)’’.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–643

(c) AMENDMENT RELATED TO SECTION 1103 OF THE ACT.—Paragraph (6) of section 6103(k) is amended—

(1) by inserting ‘‘and an officer or employee of the Office

of Treasury Inspector General for Tax Administration’’ after

‘‘internal revenue officer or employee’’, and

(2) by striking ‘‘INTERNAL REVENUE’’ in the heading and

inserting ‘‘CERTAIN’’.

(d) AMENDMENT RELATED TO SECTION 3401 OF THE ACT.—

Section 6330(d)(1)(A) is amended by striking ‘‘to hear’’ and inserting

‘‘with respect to’’.

(e) AMENDMENT RELATED TO SECTION 3509 OF THE ACT.—

Subparagraph (A) of section 6110(g)(5) is amended by inserting

‘‘, any Chief Counsel advice,’’ after ‘‘technical advice memorandum’’.

(f ) EFFECTIVE DATES.—The amendments made by subsections

(a) and (b) shall take effect on the date of the enactment of this

Act. The amendments made by subsections (c), (d), and (e) shall

take effect as if included in the provisions of the Internal Revenue

Service Restructuring and Reform Act of 1998 to which they relate.

SEC. 314. AMENDMENTS RELATED TO TAXPAYER RELIEF ACT OF 1997.

(a) AMENDMENT RELATED TO SECTION 101 OF THE ACT.—Paragraph (4) of section 6211(b) is amended by striking ‘‘sections 32

and 34’’ and inserting ‘‘sections 24(d), 32, and 34’’.

(b) AMENDMENT RELATED TO SECTION 302 OF THE ACT.—The

last sentence of section 3405(e)(1)(B) is amended by inserting ‘‘(other

than a Roth IRA)’’ after ‘‘individual retirement plan’’.

(c) AMENDMENT TO SECTION 311 OF THE ACT.—Paragraph (3)

of section 311(e) of the Taxpayer Relief Act of 1997 (relating to

election to recognize gain on assets held on January 1, 2001) is

amended by adding at the end the following new sentence: ‘‘Such

an election shall not apply to any asset which is disposed of (in

a transaction in which gain or loss is recognized in whole or in

part) before the close of the 1-year period beginning on the date

that the asset would have been treated as sold under such election.’’.

(d) AMENDMENT RELATED TO SECTION 402 OF THE ACT.—The

flush sentence at the end of clause (ii) of section 56(a)(1)(A) is

amended by inserting before ‘‘or to any other property’’ the following:

‘‘(and the straight line method shall be used for such 1250 property)’’.

(e) AMENDMENTS RELATED TO SECTION 1072 OF THE ACT.—

(1) Clause (ii) of section 415(c)(3)(D) and subparagraph

(B) of section 403(b)(3) are each amended by striking ‘‘section

125 or’’ and inserting ‘‘section 125, 132(f )(4), or’’.

(2) Paragraph (2) of section 414(s) is amended by striking

‘‘section 125, 402(e)(3)’’ and inserting ‘‘section 125, 132(f )(4),

402(e)(3)’’.

(f ) AMENDMENT RELATED TO SECTION 1454 OF THE ACT.—Subsection (a) of section 7436 is amended by inserting before the

period at the end of the first sentence ‘‘and the proper amount

of employment tax under such determination’’.

(g) EFFECTIVE DATE.—The amendments made by this section

shall take effect as if included in the provisions of the Taxpayer

Relief of 1997 to which they relate.

SEC. 315. AMENDMENTS RELATED TO BALANCED BUDGET ACT OF 1997.

(a) AMENDMENTS RELATED TO SECTION 9302 OF THE ACT.—

114 STAT. 2763A–644 PUBLIC LAW 106–554—APPENDIX G

(1) Paragraph (1) of section 9302( j) of the Balanced Budget

Act of 1997 is amended by striking ‘‘tobacco products and

cigarette papers and tubes’’ and inserting ‘‘cigarettes’’.

(2)(A) Subsection (h) of section 5702 is amended to read

as follows:

‘‘(h) MANUFACTURER OF CIGARETTE PAPERS AND TUBES.—‘Manufacturer of cigarette papers and tubes’ means any person who

manufactures cigarette paper, or makes up cigarette paper into

tubes, except for his own personal use or consumption.’’.

(B) Section 5702, as amended by subparagraph (A), is

amended by striking subsection (f ) and by redesignating subsections (g) through (p) as subsections (f ) through (o), respectively.

(3) Subsection (c) of section 5761 is amended by adding

at the end the following: ‘‘This subsection and section 5754

shall not apply to any person who relands or receives tobacco

products in the quantity allowed entry free of tax and duty

under chapter 98 of the Harmonized Tariff Schedule of the

United States, and such person may voluntarily relinquish

to the Secretary at the time of entry any excess of such quantity

without incurring the penalty under this subsection. No quantity of tobacco products other than the quantity referred to

in the preceding sentence may be relanded or received as a

personal use quantity.’’.

(b) EFFECTIVE DATE.—The amendments made by this section

shall take effect as if included in section 9302 of the Balanced

Budget Act of 1997.

SEC. 316. AMENDMENTS RELATED TO SMALL BUSINESS JOB PROTECTION ACT OF 1996.

(a) AMENDMENT RELATED TO SECTION 1201 OF THE ACT.—

Subparagraph (B) of section 51(d)(2) is amended—

(1) by striking ‘‘plan approved’’ and inserting ‘‘program

funded’’, and

(2) by striking ‘‘(relating to assistance for needy families

with minor children)’’.

(b) AMENDMENT RELATED TO SECTION 1302 OF THE ACT.—

Clause (i) of section 1361(e)(1)(A) is amended by striking ‘‘or’’ before

‘‘(III)’’ and by adding at the end the following: ‘‘or (IV) an organization described in section 170(c)(1) which holds a contingent interest

in such trust and is not a potential current beneficiary,’’.

(c) AMENDMENT RELATED TO SECTION 1401 OF THE ACT.—

Clause (ii) of section 401(k)(10)(B) is amended by adding at the

end the following new sentence: ‘‘Such term includes a distribution

of an annuity contract from—

‘‘(I) a trust which forms a part of a plan

described in section 401(a) and which is exempt

from tax under section 501(a), or

‘‘(II) an annuity plan described in section

403(a).’’.

(d) AMENDMENT RELATED TO SECTION 1427 OF THE ACT.—

Clause (ii) of section 219(c)(1)(B) is amended by striking ‘‘and’’

at the end of subclause (I), by redesignating subclause (II) as

subclause (III), and by inserting after subclause (I) the following

new subclause:

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–645

‘‘(II) the amount of any designated nondeductible contribution (as defined in section 408(o)) on

behalf of such spouse for such taxable year, and’’. (e) EFFECTIVE DATE.—The amendments made by this section

shall take effect as if included in the provisions of the Small

Business Job Protection Act of 1996 to which they relate.

SEC. 317. AMENDMENT RELATED TO REVENUE RECONCILIATION ACT

OF 1990.

(a) AMENDMENT RELATED TO SECTION 11511 OF THE ACT.— Subparagraph (C) of section 43(c)(1) is amended— (1) by inserting ‘‘(as defined in section 193(b))’’ after ‘‘expenses’’, and

(2) by striking ‘‘under section 193’’. (b) EFFECTIVE DATE.—The amendment made by this section

shall take effect as if included in section 11511 of the Revenue

Reconciliation Act of 1990.

SEC. 318. OTHER TECHNICAL CORRECTIONS.

(a) MODIFIED ENDOWMENT CONTRACTS.— (1) Paragraph (2) of section 7702A(a) is amended by inserting ‘‘or this paragraph’’ before the period.

(2) Clause (ii) of section 7702A(c)(3)(A) is amended by striking ‘‘under the contract’’ and inserting ‘‘under the old contract’’. (3) The amendments made by this subsection shall take

effect as if included in the amendments made by section 5012

of the Technical and Miscellaneous Revenue Act of 1988.

(b) AFFILIATED CORPORATIONS IN CONTEXT OF WORTHLESS

SECURITIES.— (1) Subparagraph (A) of section 165(g)(3) is amended to

read as follows: ‘‘(A) the taxpayer owns directly stock in such corporation meeting the requirements of section 1504(a)(2), and’’. (2) Paragraph (3) of section 165(g) is amended by striking

the last sentence.

(3) The amendments made by this subsection shall apply

to taxable years beginning after December 31, 1984.

(c) CERTAIN ANNUITIES ISSUED BY TAX-EXEMPT ORGANIZATIONS

NOT TREATED AS DEBT INSTRUMENTS UNDER ORIGINAL ISSUE DIS- COUNT RULES.— (1) Clause (ii) of section 1275(a)(1)(B) is amended by striking ‘‘subchapter L’’ and inserting ‘‘subchapter L (or by an entity

described in section 501(c) and exempt from tax under section

501(a) which would be subject to tax under subchapter L were

it not so exempt)’’. (2) The amendment made by this subsection shall take

effect as if included in the amendments made by section 41

of the Tax Reform Act of 1984.

(d) TENTATIVE CARRYBACK ADJUSTMENTS OF LOSSES FROM SECTION 1256 CONTRACTS.—

(1) Subsection (a) of section 6411 is amended by striking

‘‘section 1212(a)(1)’’ and inserting ‘‘subsection (a)(1) or (c) of

section 1212’’.

(2) The amendment made by paragraph (1) shall take effect

as if included in the amendments made by section 504 of

the Economic Recovery Tax Act of 1981.

(e) CORRECTION OF CALCULATION OF AMOUNTS TO BE DEPOSITED

IN HIGHWAY TRUST FUND.—

114 STAT. 2763A–646 PUBLIC LAW 106–554—APPENDIX G

(1) Subsection (b) of section 9503 is amended by striking

paragraph (5) and redesignating paragraph (6) as paragraph

(5).

(2) The amendment made by paragraph (1) shall apply

with respect to taxes received in the Treasury after the date

of the enactment of this Act.

(f ) EXPENDITURES FROM VACCINE INJURY COMPENSATION TRUST

FUND.—Section 9510(c)(1)(A) is amended by striking ‘‘December

31, 1999’’ and inserting ‘‘October 18, 2000’’.

SEC. 319. CLERICAL CHANGES.

(1) Clause (i) of section 45(d)(7)(A) is amended by striking

‘‘paragraph (3)(A)’’ and inserting ‘‘subsection (c)(3)(A)’’.

(2) Subsection (f ) of section 67 is amended by striking

‘‘the last sentence’’ and inserting ‘‘the second sentence’’.

(3) The heading for paragraph (5) of section 408(d) is

amended to read as follows:

‘‘(5) DISTRIBUTIONS OF EXCESS CONTRIBUTIONS AFTER DUE

DATE FOR TAXABLE YEAR AND CERTAIN EXCESS ROLLOVER CONTRIBUTIONS.—’’.

(4) Paragraph (3) of section 475(g) is amended by striking

‘‘267(b) of’’ and inserting ‘‘267(b) or’’.

(5) The heading for subparagraph (B) of section 529(e)(3)

is amended by striking ‘‘UNDER GUARANTEED PLANS’’.

(6) Clause (iii) of section 530(d)(4)(B) is amended by striking

‘‘; or’’ at the end and inserting ‘‘, or’’.

(7) Paragraphs (1)(C) and (2)(C) of section 664(d) are each

amended by striking the period after ‘‘subsection (g))’’.

(8)(A) Subsection (e) of section 678 is amended by striking

‘‘an electing small business corporation’’ and inserting ‘‘an S

corporation’’.

(B) Clause (v) of section 6103(e)(1)(D) is amended to read

as follows:

‘‘(v) if the corporation was an S corporation, any

person who was a shareholder during any part of the

period covered by such return during which an election

under section 1362(a) was in effect, or’’.

(9) Paragraph (7) of section 856(c) is amended by striking

‘‘paragraph (4)(B)(ii)(III)’’ and inserting ‘‘paragraph

(4)(B)(iii)(III)’’

(10) Subparagraph (A) of section 856(l)(4) is amended by

striking ‘‘paragraph (9)(D)(ii)’’ and inserting ‘‘subsection

(d)(9)(D)(ii)’’.

(11) Subparagraph (B) of section 871(f )(2) is amended by

striking ‘‘19 U.S.C.’’ and inserting ‘‘(19 U.S.C.’’.

(12) Subparagraph (B) of section 995(b)(3) is amended by

striking ‘‘the Military Security Act of 1954 (22 U.S.C. 1934)’’

and inserting ‘‘section 38 of the International Security Assistance and Arms Export Control Act of 1976 (22 U.S.C. 2778)’’.

(13) Section 1391(g)(3)(C) is amended by striking ‘‘paragraph (1)(B)’’ and inserting ‘‘paragraph (1)’’.

(14)(A) Paragraph (2) of section 2035(c) is amended by

striking ‘‘paragraph (1)’’ and inserting ‘‘subsection (a)’’.

(B) Subsection (d) of section 2035 is amended by inserting

‘‘and paragraph (1) of subsection (c)’’ after ‘‘Subsection (a)’’.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–647

(15) Paragraph (5) of section 3121(a) is amended by striking

the semicolon at the end of subparagraph (G) and inserting

a comma.

(16) Subparagraph (B) of section 4946(c)(3) is amended

by striking ‘‘the lowest rate of compensation prescribed for

GS–16 of the General Schedule under section 5332’’ and inserting ‘‘the lowest rate of basic pay for the Senior Executive

Service under section 5382’’.

(17) Subsection (p) of section 6103 is amended—

(A) in paragraph (4), in the matter preceding subparagraph (A)—

(i) by striking the second comma after ‘‘(13)’’, and

(ii) by striking ‘‘(7)’’ and all that follows through

‘‘shall, as a condition’’ and inserting ‘‘(7), (8), (9), (12),

(15), or (16) or any other person described in subsection

(l)(16) shall, as a condition’’, and

(B) in paragraph (4)(F)(ii), by striking the second

comma after ‘‘(14)’’.

(18) Paragraph (5) of section 6166(k) is amended by striking

‘‘2035(d)(4)’’ and inserting ‘‘2035(c)(2)’’.

(19) Subsection (a) of section 6512 is amended by striking

‘‘; and’’ at the end of paragraphs (1), (2), and (5) and inserting

‘‘, and’’.

(20) Paragraph (1) of section 6611(g) is amended by striking

the comma after ‘‘(b)(3)’’.

(21) Subparagraphs (A) and (B) of section 6655(e)(5) are

amended by striking ‘‘subsections (d)(5) and (l)(3)(B)’’ and

inserting ‘‘subsection (d)(5)’’.

(22) The subchapter heading for subchapter D of chapter

67 is amended by capitalizing the first letter of the second

word.

(23)(A) Section 6724(d)(1)(B) is amended by striking clauses

(xiv) through (xvii) and inserting the following:

‘‘(xiv) subparagraph (A) or (C) of subsection (c)(4)

of section 4093 (relating to information reporting with

respect to tax on diesel and aviation fuels),

‘‘(xv) section 4101(d) (relating to information

reporting with respect to fuels taxes),

‘‘(xvi) subparagraph (C) of section 338(h)(10) (relating to information required to be furnished to the

Secretary in case of elective recognition of gain or

loss), or

‘‘(xvii) section 264(f )(5)(A)(iv) (relating to reporting

with respect to certain life insurance and annuity contracts), and’’.

(B) Section 6010(o)(4)(C) of the Internal Revenue Service

Restructuring and Reform Act of 1998 is amended by striking

‘‘inserting ‘or’, and by adding at the end’’ and inserting ‘‘inserting ‘, or’, and by adding after subparagraph (Z)’’.

(24) Subsection (a) of section 7421 is amended by striking

‘‘6672(b)’’ and inserting ‘‘6672(c)’’.

(25) Paragraph (3) of section 7430(c) is amended—

(A) in the paragraph heading, by striking ‘‘ATTORNEYS’’

and inserting ‘‘ATTORNEYS’ ’’, and

(B) in subparagraph (B), by striking ‘‘attorneys fees’’

each place it appears and inserting ‘‘attorneys’ fees’’.

114 STAT. 2763A–648 PUBLIC LAW 106–554—APPENDIX G

(26) Paragraph (2) of section 7603(b) is amended by striking

the semicolon at the end of subparagraphs (A), (B), (C), (D),

(E), (F), and (G) and inserting a comma.

(27) Clause (ii) of section 7802(b)(2)(B) is amended by striking ‘‘; and’’ at the end and inserting ‘‘, and’’.

(28) Paragraph (3) of section 7811(a) is amended by striking

‘‘taxpayer assistance order’’ and inserting ‘‘Taxpayer Assistance

Order’’.

(29) Paragraph (1) of section 7811(d) is amended by striking

‘‘Ombudsman’s’’ and inserting ‘‘National Taxpayer Advocate’s’’.

(30) Paragraph (3) of section 7872(f ) is amended by striking

‘‘foregoing’’ and inserting ‘‘forgoing’’.

TITLE IV—TAX TREATMENT OF

SECURITIES FUTURES CONTRACTS

SEC. 401. TAX TREATMENT OF SECURITIES FUTURES CONTRACTS.

(a) IN GENERAL.—Subpart IV of subchapter P of chapter 1

(relating to special rules for determining gains and losses) is amended by inserting after section 1234A the following new section:

‘‘SEC. 1234B. GAINS OR LOSSES FROM SECURITIES FUTURES CONTRACTS.

‘‘(a) TREATMENT OF GAIN OR LOSS.—

‘‘(1) IN GENERAL.—Gain or loss attributable to the sale

or exchange of a securities futures contract shall be considered

gain or loss from the sale or exchange of property which has

the same character as the property to which the contract relates

has in the hands of the taxpayer (or would have in the hands

of the taxpayer if acquired by the taxpayer).

‘‘(2) NONAPPLICATION OF SUBSECTION.—This subsection

shall not apply to—

‘‘(A) a contract which constitutes property described

in paragraph (1) or (7) of section 1221(a), and

‘‘(B) any income derived in connection with a contract

which, without regard to this subsection, is treated as

other than gain from the sale or exchange of a capital

asset.

‘‘(b) SHORT-TERM GAINS AND LOSSES.—Except as provided in

the regulations under section 1092(b) or this section, if gain or

loss on the sale or exchange of a securities futures contract to

sell property is considered as gain or loss from the sale or exchange

of a capital asset, such gain or loss shall be treated as shortterm capital gain or loss.

‘‘(c) SECURITIES FUTURES CONTRACT.—For purposes of this section, the term ‘securities futures contract’ means any security future

(as defined in section 3(a)(55)(A) of the Securities Exchange Act

of 1934, as in effect on the date of the enactment of this section).

‘‘(d) CONTRACTS NOT TREATED AS COMMODITY FUTURES CONTRACTS.—For purposes of this title, a securities futures contract

shall not be treated as a commodity futures contract.

‘‘(e) REGULATIONS.—The Secretary shall prescribe such regulations as may be appropriate to provide for the proper treatment

of securities futures contracts under this title.’’.

(b) TERMINATIONS, ETC.—Section 1234A is amended—

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–649

(1) by inserting ‘‘(other than a securities futures contract,

as defined in section 1234B)’’ after ‘‘right or obligation’’ in

paragraph (1),

(2) by striking ‘‘or’’ at the end of paragraph (1),

(3) by adding ‘‘or’’ at the end of paragraph (2), and

(4) by inserting after paragraph (2) the following new paragraph:

‘‘(3) a securities futures contract (as so defined) which

is a capital asset in the hands of the taxpayer,’’.

(c) NONRECOGNITION UNDER SECTION 1032.—The second sentence of section 1032(a) is amended by inserting ‘‘, or with respect

to a securities futures contract (as defined in section 1234B),’’ after ‘‘an option’’. (d) TREATMENT UNDER WASH SALES RULES.—Section 1091 is

amended by adding at the end the following new subsection: ‘‘(f ) CASH SETTLEMENT.—This section shall not fail to apply

to a contract or option to acquire or sell stock or securities solely

by reason of the fact that the contract or option settles in (or

could be settled in) cash or property other than such stock or

securities.’’. (e) TREATMENT UNDER STRADDLE RULES.—Clause (i) of section

1092(d)(3)(B) is amended by striking ‘‘or’’ at the end of subclause

(I), by redesignating subclause (II) as subclause (III), and by inserting after subclause (I) the following new subclause:

‘‘(II) a securities futures contract (as defined

in section 1234B) with respect to such stock or

substantially identical stock or securities, or’’.

(f ) TREATMENT UNDER SHORT SALES RULES.—Paragraph (2)

of section 1233(e) is amended by striking ‘‘and’’ at the end of

subparagraph (B), by striking the period at the end of subparagraph

(C) and inserting ‘‘; and’’, and by adding at the end the following:

‘‘(D) a securities futures contract (as defined in section

1234B) to acquire substantially identical property shall

be treated as substantially identical property.’’.

(g) TREATMENT UNDER SECTION 1256.— (1)(A) Subsection (b) of section 1256 is amended by striking

‘‘and’’ at the end of paragraph (3), by striking the period at

the end of paragraph (4) and inserting ‘‘, and’’, and by adding

at the end the following:

‘‘(5) any dealer securities futures contract.

The term ‘section 1256 contract’ shall not include any securities

futures contract or option on such a contract unless such contract

or option is a dealer securities futures contract.’’.

(B) Subsection (g) of section 1256 is amended by adding

at the end the following new paragraph:

‘‘(9) DEALER SECURITIES FUTURES CONTRACT.—

‘‘(A) IN GENERAL.—The term ‘dealer securities futures

contract’ means, with respect to any dealer, any securities

futures contract, and any option on such a contract,

which—

‘‘(i) is entered into by such dealer (or, in the case

of an option, is purchased or granted by such dealer)

in the normal course of his activity of dealing in such

contracts or options, as the case may be, and

‘‘(ii) is traded on a qualified board or exchange.

‘‘(B) DEALER.—For purposes of subparagraph (A), a

person shall be treated as a dealer in securities futures

114 STAT. 2763A–650 PUBLIC LAW 106–554—APPENDIX G

contracts or options on such contracts if the Secretary

determines that such person performs, with respect to such

contracts or options, as the case may be, functions similar

to the functions performed by persons described in paragraph (8)(A). Such determination shall be made to the

extent appropriate to carry out the purposes of this section.

‘‘(C) SECURITIES FUTURES CONTRACT.—The term ‘securities futures contract’ has the meaning given to such term

by section 1234B.’’. (2) Paragraph (4) of section 1256(f ) is amended— (A) by inserting ‘‘, or dealer securities futures contracts,’’ after ‘‘dealer equity options’’ in the text, and

(B) by inserting ‘‘AND DEALER SECURITIES FUTURES CON- TRACTS’’ after ‘‘DEALER EQUITY OPTIONS’’ in the heading.

(3) Paragraph (6) of section 1256(g) is amended to read

as follows: ‘‘(6) EQUITY OPTION.—The term ‘equity option’ means any

option—

‘‘(A) to buy or sell stock, or

‘‘(B) the value of which is determined directly or

indirectly by reference to any stock or any narrow-based

security index (as defined in section 3(a)(55) of the Securities Exchange Act of 1934, as in effect on the date of

the enactment of this paragraph).

The term ‘equity option’ includes such an option on a group

of stocks only if such group meets the requirements for a

narrow-based security index (as so defined).’’.

(4) The Secretary of the Treasury or his delegate shall

make the determinations under section 1256(g)(9)(B) of the

Internal Revenue Code of 1986, as added by this Act, not

later than July 1, 2001.

(h) CONFORMING AMENDMENTS.—

(1) Section 1223 is amended by redesignating paragraph

(16) as paragraph (17) and by inserting after paragraph (15)

the following new paragraph: ‘‘(16) If the security to which a securities futures contract

(as defined in section 1234B) relates (other than a contract

to which section 1256 applies) is acquired in satisfaction of

such contract, in determining the period for which the taxpayer

has held such security, there shall be included the period for

which the taxpayer held such contract if such contract was

a capital asset in the hands of the taxpayer.’’.

(2) The table of sections for subpart IV of subchapter P

of chapter 1 is amended by inserting after the item relating

to section 1234A the following new item:

‘‘Sec. 1234B. Securities futures contracts.’’.

(i) DESIGNATION OF CONTRACT MARKETS.—Section 7701 is

amended by redesignating subsection (m) as subsection (n) and

by inserting after subsection (l) the following new subsection:

‘‘(m) DESIGNATION OF CONTRACT MARKETS.—Any designation

by the Commodity Futures Trading Commission of a contract market which could not have been made under the law in effect on

the day before the date of the enactment of the Commodity Futures

Modernization Act of 2000 shall apply for purposes of this title

except to the extent provided in regulations prescribed by the Secretary.’’.

PUBLIC LAW 106–554—APPENDIX G 114 STAT. 2763A–651

( j) EFFECTIVE DATE.—The amendments made by this section

shall take effect on the date of the enactment of this Act.

PUBLIC LAW 106–554—APPENDIX H 114 STAT. 2763A–653

APPENDIX H—H.R. 5663

SECTION 1. NEW MARKETS VENTURE CAPITAL PROGRAM.

(a) SHORT TITLE.—This section may be cited as the ‘‘New Markets Venture Capital Program Act of 2000’’.

(b) NEW MARKETS VENTURE CAPITAL PROGRAM.—Title III of

the Small Business Investment Act of 1958 (15 U.S.C. 681 et

seq.) is amended—

(1) in the heading for the title, by striking ‘‘SMALL BUSINESS INVESTMENT COMPANIES’’and inserting ‘‘INVESTMENT DIVISION PROGRAMS’’;

(2) by inserting before the heading for section 301 the

following:

‘‘PART A—SMALL BUSINESS INVESTMENT COMPANIES’’;

and

(3) by adding at the end the following:

‘‘PART B—NEW MARKETS VENTURE CAPITAL PROGRAM

‘‘SEC. 351. DEFINITIONS.

‘‘In this part, the following definitions apply:

‘‘(1) DEVELOPMENTAL VENTURE CAPITAL.—The term ‘developmental venture capital’ means capital in the form of

equity capital investments in businesses made with a primary

objective of fostering economic development in low-income

geographic areas. For the purposes of this paragraph, the term

‘equity capital’ has the same meaning given such term in section

303(g)(4).

‘‘(2) LOW-INCOME INDIVIDUAL.—The term ‘low-income

individual’ means an individual whose income (adjusted for

family size) does not exceed—

‘‘(A) for metropolitan areas, 80 percent of the area

median income; and

‘‘(B) for nonmetropolitan areas, the greater of—

‘‘(i) 80 percent of the area median income; or

‘‘(ii) 80 percent of the statewide nonmetropolitan

area median income.

‘‘(3) LOW-INCOME GEOGRAPHIC AREA.—the term ‘low-income

geographic area’ means—

‘‘(A) any population census tract (or in the case of

an area that is not tracted for population census tracts,

the equivalent county division, as defined by the Bureau

of the Census of the Department of Commerce for purposes

of defining poverty areas), if—

114 STAT. 2763A–654 PUBLIC LAW 106–554—APPENDIX H

‘‘(i) the poverty rate for that census tract is not

less than 20 percent; ‘‘(ii) in the case of a tract— ‘‘(I) that is located within a metropolitan area,

50 percent or more of the households in that census

tract have an income equal to less than 60 percent

of the area median gross income; or

‘‘(II) that is not located within a metropolitan

area, the median household income for such tract

does not exceed 80 percent of the statewide median

household income; or

‘‘(iii) as determined by the Administrator based

on objective criteria, a substantial population of lowincome individuals reside, an inadequate access to

investment capital exists, or other indications of economic distress exist in that census tract; or

‘‘(B) any area located within—

‘‘(i) a HUBZone (as defined in section 3(p) of the

Small Business Act and the implementing regulations

issued under that section);

‘‘(ii) an urban empowerment zone or urban enterprise community (as designated by the Secretary of

Housing and Urban Development); or

‘‘(iii) a rural empowerment zone or rural enterprise

community (as designated by the Secretary of Agriculture).

‘‘(4) NEW MARKETS VENTURE CAPITAL COMPANY.—The term

‘New Markets Venture Capital company’ means a company

that—

‘‘(A) has been granted final approval by the Administrator under section 354(e); and

‘‘(B) has entered into a participation agreement with

the Administrator.

‘‘(5) OPERATIONAL ASSISTANCE.—The term ‘operational

assistance’ means management, marketing, and other technical

assistance that assists a small business concern with business

development.

‘‘(6) PARTICIPATION AGREEMENT.—The term ‘participation

agreement’ means an agreement, between the Administrator

and a company granted final approval under section 354(e),

that—

‘‘(A) details the company’s operating plan and investment criteria; and

‘‘(B) requires the company to make investments in

smaller enterprises at least 80 percent of which are located

in low-income geographic areas.

‘‘(7) SPECIALIZED SMALL BUSINESS INVESTMENT COMPANY.—

The term ‘specialized small business investment company’

means any small business investment company that—

‘‘(A) invests solely in small business concerns that

contribute to a well-balanced national economy by facilitating ownership in such concerns by persons whose participation in the free enterprise system is hampered because

of social or economic disadvantages;

‘‘(B) is organized or chartered under State business

or nonprofit corporations statutes, or formed as a limited

partnership; and

PUBLIC LAW 106–554—APPENDIX H 114 STAT. 2763A–655

‘‘(C) was licensed under section 301(d), as in effect

before September 30, 1996.

‘‘(8) STATE.—The term ‘State’ means such of the several

States, the District of Columbia, the Commonwealth of Puerto

Rico, the Virgin Islands, Guam, American Samoa, the Commonwealth of the Northern Mariana Islands, and any other

commonwealth, territory, or possession of the United States.

‘‘SEC. 352. PURPOSES.

‘‘The purposes of the New Markets Venture Capital Program

established under this part are— ‘‘(1) to promote economic development and the creation

of wealth and job opportunities in low-income geographic areas

and among individuals living in such areas by encouraging

developmental venture capital investments in smaller enterprises primarily located in such areas; and ‘‘(2) to establish a developmental venture capital program,

with the mission of addressing the unmet equity investment

needs of small enterprises located in low-income geographic

areas, to be administered by the Administrator— ‘‘(A) to enter into participation agreements with New

Markets Venture Capital companies; ‘‘(B) to guarantee debentures of New Markets Venture

Capital companies to enable each such company to make

developmental venture capital investments in smaller

enterprises in low-income geographic areas; and ‘‘(C) to make grants to New Markets Venture Capital

companies, and to other entities, for the purpose of providing operational assistance to smaller enterprises financed,

or expected to be financed, by such companies.

‘‘SEC. 353. ESTABLISHMENT.

‘‘In accordance with this part, the Administrator shall establish

a New Markets Venture Capital Program, under which the Administrator may—

‘‘(1) enter into participation agreements with companies

granted final approval under section 354(e) for the purposes

set forth in section 352;

‘‘(2) guarantee the debentures issued by New Markets Venture Capital companies as provided in section 355; and

‘‘(3) make grants to New Markets Venture Capital companies, and to other entities, under section 358.

‘‘SEC. 354. SELECTION OF NEW MARKETS VENTURE CAPITAL COMPANIES.

‘‘(a) ELIGIBILITY.—A company shall be eligible to apply to

participate, as a New Markets Venture Capital company, in the

program established under this part if—

‘‘(1) the company is a newly formed for-profit entity or

a newly formed for-profit subsidiary of an existing entity;

‘‘(2) the company has a management team with experience

in community development financing or relevant venture capital

financing; and

‘‘(3) the company has a primary objective of economic

development of low-income geographic areas.

‘‘(b) APPLICATION.—To participate, as a New Markets Venture

Capital company, in the program established under this part a

114 STAT. 2763A–656 PUBLIC LAW 106–554—APPENDIX H

company meeting the eligibility requirements set forth in subsection

(a) shall submit an application to the Administrator that includes— ‘‘(1) a business plan describing how the company intends

to make successful developmental venture capital investments

in identified low-income geographic areas;

‘‘(2) information regarding the community development

finance or relevant venture capital qualifications and general

reputation of the company’s management;

‘‘(3) a description of how the company intends to work

with community organizations and to seek to address the unmet

capital needs of the communities served;

‘‘(4) a proposal describing how the company intends to

use the grant funds provided under this part to provide operational assistance to smaller enterprises financed by the company, including information regarding whether the company

intends to use licensed professionals, when necessary, on the

company’s staff or from an outside entity;

‘‘(5) with respect to binding commitments to be made to

the company under this part, an estimate of the ratio of cash

to in-kind contributions;

‘‘(6) a description of the criteria to be used to evaluate

whether and to what extent the company meets the objectives

of the program established under this part;

‘‘(7) information regarding the management and financial

strength of any parent firm, affiliated firm, or any other firm

essential to the success of the company’s business plan; and

‘‘(8) such other information as the Administrator may

require.

‘‘(c) CONDITIONAL APPROVAL.—

‘‘(1) IN GENERAL.—From among companies submitting

applications under subsection (b), the Administrator shall, in

accordance with this subsection, conditionally approval companies to participate in the New Markets Venture Capital Program.

‘‘(2) SELECTION CRITERIA.—In selecting companies under

paragraph (1), the Administrator shall consider the following:

‘‘(A) The likelihood that the company will meet the

goal of its business plan.

‘‘(B) The experience and background of the company’s

management team.

‘‘(C) The need for developmental venture capital investments in the geographic areas in which the company

intends to invest.

‘‘(D) The extent to which the company will concentrate

its activities on serving the geographic areas in which

it intends to invest.

‘‘(E) The likelihood that the company will be able to

satisfy the conditions under subsection (d).

‘‘(F) The extent to which the activities proposed by

the company will expand economic opportunities in the

geographic areas in which the company intends to invest.

‘‘(G) The strength of the company’s proposal to provide

operational assistance under this part as the proposal

relates to the ability of the applicant to meet applicable

cash requirements and properly utilize in-kind contributions, including the use of resources for the services of

licensed professionals, when necessary, whether provided

PUBLIC LAW 106–554—APPENDIX H 114 STAT. 2763A–657

by persons on the company’s staff or by persons outside

of the company. ‘‘(H) Any other factors deemed appropriate by the

Administrator.

‘‘(3) NATIONWIDE DISTRIBUTION.—The Administrator shall

select companies under paragraph (1) in such a way that promotes investment nationwide.

‘‘(d) REQUIREMENTS TO BE MET FOR FINAL APPROVAL.—The

Administrator shall grant each conditionally approved company

a period of time, not to exceed 2 years, to satisfy the following

requirements: ‘‘(1) CAPITAL REQUIREMENT.—Each conditionally approved company shall raise not less than $5,000,000 of private capital

or binding capital commitments from one or more investors

(other than agencies or departments of the Federal Government) who met criteria established by the Administrator. ‘‘(2) NONADMINISTRATION RESOURCES FOR OPERATIONAL

ASSISTANCE.—

‘‘(A) IN GENERAL.—In order to provide operational

assistance to smaller enterprises expected to be financed

by the company, each conditionally approved company—

‘‘(i) shall have binding commitments (for contribution in cash or in kind)—

‘‘(I) from any sources other than the Small

Business Administration that meet criteria established by the Administrator;

‘‘(II) payable or available over a multiyear

period acceptable to the Administrator (not to

exceed 10 years); and

‘‘(III) in an amount not less than 30 percent

of the total amount of capital and commitments

raised under paragraph (1);

‘‘(ii) shall have purchased an annuity—

‘‘(I) from an insurance company acceptable to

the Administrator; ‘‘(II) using funds (other than the funds raised

under paragraph (1)), from any source other than

the Administrator; and

‘‘(III) that yields cash payments over a

multiyear period acceptable to the Administrator

(not to exceed 10 years) in an amount not less

than 30 percent of the total amount of capital

and commitments raised under paragraph (1); or

‘‘(iii) shall have binding commitments (for contributions in cash or in kind) of the type described in

clause (i) and shall have purchased an annuity of the

type described in clause (ii), which in the aggregate

make available, over a multiyear period acceptable

to the Administrator (not to exceed 10 years), an

amount not less than 30 percent of the total amount

of capital and commitments raised under paragraph

(1).

‘‘(B) EXCEPTION.—The Administrator may, in the

discretion of the Administrator and based upon a showing

of special circumstances and good cause, consider an

applicant to have satisfied the requirements of subparagraph (A) if the applicant has—

114 STAT. 2763A–658 PUBLIC LAW 106–554—APPENDIX H

‘‘(i) a viable plan that reasonably projects the

capacity of the applicant to raise the amount (in cash

or in-kind) required under subparagraph (A); and ‘‘(ii) binding commitments in an amount equal to

not less than 20 percent of the total amount required

under paragraph (A).

‘‘(C) LIMITATION.—In order to comply with the requirements of subparagraphs (A) and (B), the total amount

of a company’s in-kind contributions may not exceed 50

percent of the company’s total contributions. ‘‘(e) FINAL APPROVAL; DESIGNATION.—The Administrator shall,

with respect to each applicant conditionally approved to operate

as a New Markets Venture Capital company under subsection (c),

either— ‘‘(1) grant final approval to the applicant to operate as

a New Markets Venture Capital company under this part and

designate the applicant as such a company, if the applicant— ‘‘(A) satisfies the requirements of subsection (d) on

or before the expiration of the time period described in

that subsection; and ‘‘(B) enters into a participation agreement with the

Administrator; or

‘‘(2) if the applicant fails to satisfy the requirements of

subsection (d) on or before the expiration of the time period

described in that subsection, revoke the conditional approval

granted under that subsection.

‘‘SEC. 355. DEBENTURES.

‘‘(a) IN GENERAL.—The Administrator may guarantee the timely

payment of principal and interest, as scheduled, on debentures

issued by any New Markets Venture Capital company.

‘‘(b) TERMS AND CONDITIONS.—The Administrator may make

guarantees under this section on such terms and conditions as

it deems appropriate, except that the term of any debenture guaranteed under this section shall not exceed 15 years. ‘‘(c) FULL FAITH AND CREDIT OF THE UNITED STATES.—The

full faith and credit of the United States is pledged to pay all

amounts that may be required to be paid under any guarantee

under this part.

‘‘(d) MAXIMUM GUARANTEE.—

‘‘(1) IN GENERAL.—Under this section, the Administrator

may guarantee the debentures issued by a New Markets Venture Capital company only to be extent that the total face

amount of outstanding guaranteed debentures of such company

does not exceed 150 percent of the private capital of the company, as determined by the Administrator.

‘‘(2) TREATMENT OF CERTAIN FEDERAL FUNDS.—For the purposes of paragraph (1), private capital shall include capital

that is considered to be Federal funds, if such capital is contributed by an investor other than an agency or department of

the Federal Government.

‘‘SEC. 356. ISSUANCE AND GUARANTEE OF TRUST CERTIFICATES.

‘‘(a) ISSUANCE.—The Administrator may issue trust certificates

representing ownership of all or a fractional part of debentures

issued by a New Markets Venture Capital company and guaranteed

by the Administrator under this part, if such certificates are based

PUBLIC LAW 106–554—APPENDIX H 114 STAT. 2763A–659

on and backed by a trust or pool approved by the Administrator

and composed solely of guaranteed debentures.

‘‘(b) GUARANTEE.—

‘‘(1) IN GENERAL.—The Administrator may, under such

terms and conditions as it deems appropriate, guarantee the

timely payment of the principal of and interest on trust certificates issued by the Administrator or its agents for purposes

of this section.

‘‘(2) LIMITATION.—Each guarantee under this subsection

shall be limited to the extent of principal and interest on

the guaranteed debentures that compose the trust or pool.

‘‘(3) PREPAYMENT OR DEFAULT.—In the event that a debenture in a trust or pool is prepaid, or in the event of default

of such a debenture, the guarantee of timely payment of principal and interest on the trust certificates shall be reduced

in proportion to the amount of principal and interest such

prepaid debenture represents in the trust or pool. Interest

on prepaid or defaulted debentures shall accrue and be guaranteed by the Administrator only through the date of payment

of the guarantee. At any time during its term, a trust certificate

may be called for redemption due to prepayment or default

of all debentures.

‘‘(c) FULL FAITH AND CREDIT OF THE UNITED STATES.—The

full faith and credit of the United States is pledged to pay all

amounts that may be required to be paid under any guarantee

of a trust certificate issued by the Administrator or its agents

under this section.

‘‘(d) FEES.—The Administrator shall not collect a fee for any

guarantee of a trust certificate under this section, but any agent

of the Administrator may collect a fee approved by the Administrator for the functions described in subsection (f )(2).

‘‘(e) SUBROGATION AND OWNERSHIP RIGHTS.—

‘‘(1) SUBROGATION.—In the event the Administrator pays

a claim under a guarantee issued under this section, it shall

be subrogated fully to the rights satisfied by such payment.

‘‘(2) OWNERSHIP RIGHTS.—No Federal, State, or local law

shall preclude or limit the exercise by the Administrator of

its ownership rights in the debentures residing in a trust or

pool against which trust certificates are issued under this section.

‘‘(f ) MANAGEMENT AND ADMINISTRATION.—

‘‘(1) REGISTRATION.—The Administrator may provide for

a central registration of all trust certificates issued under this

section.

‘‘(2) CONTRACTING OF FUNCTIONS.—

‘‘(A) IN GENERAL.—The Administrator may contract

with an agent or agents to carry out on behalf of the

Administrator the pooling and the central registration functions provided for in this section including, notwithstanding

any other provision of law—

‘‘(i) maintenance, on behalf of and under the direction of the Administrator, of such commercial bank

accounts or investments in obligations of the United

States as may be necessary to facilitate the creation

of trusts or pools backed by debentures guaranteed

under this part; and

114 STAT. 2763A–660 PUBLIC LAW 106–554—APPENDIX H

‘‘(ii) the issuance of trust certificates to facilitate

the creation of such trusts or pools.

‘‘(B) FIDELITY BOND OR INSURANCE REQUIREMENT.—Any

agent performing functions on behalf of the Administrator

under this paragraph shall provide a fidelity bond or insurance in such amounts as the Administrator determines

to be necessary to fully protect the interests of the United

States.

‘‘(3) REGULATION OF BROKERS AND DEALERS.—The Administrator may regulate brokers and dealers in trust certificates

issued under this section. ‘‘(4) ELECTRONIC REGISTRATION.—Nothing in this subsection

may be construed to prohibit the use of a book-entry or other

electronic form of registration for trust certificates issued under

this section.

‘‘SEC. 357. FEES.

‘‘Except as provided in section 356(d), the Administrator may

charge such fees as it deems appropriate with respect to any guarantee or grant issued under this part.

‘‘SEC. 358. OPERATIONAL ASSISTANCE GRANTS.

‘‘(a) IN GENERAL.— ‘‘(1) AUTHORITY.—In accordance with this section, the

Administrator may make grants to New Markets Venture Capital companies and to other entities, as authorized by this

part, to provide operational assistance to smaller enterprises

financed, or expected to be financed, by such companies or

other entities. ‘‘(2) TERMS.—Grants made under this subsection shall be

made over a multiyear period not to exceed 10 years, under

such other terms as the Administrator may require. ‘‘(3) GRANTS TO SPECIALIZED SMALL BUSINESS INVESTMENT

COMPANIES.— ‘‘(A) AUTHORITY.—In accordance with this section, the

Administrator may make grants to specialized small business investment companies to provide operational assistance to smaller enterprises financed, or expected to be

financed, by such companies after the effective date of

the New Markets Venture Capital Program Act of 2000. ‘‘(B) USE OF FUNDS.—The proceeds of a grant made

under this paragraph may be used by the company receiving such grant only to provide operational assistance in

connection with an equity investment (made with capital

raised after the effective date of the New Markets Venture

Capital Program Act of 2000) in a business located in

a low-income geographic area. ‘‘(C) SUBMISSION OF PLANS.—A specialized small business investment company shall be eligible for a grant under

this section only if the company submits to the Administrator, in such form and manner as the Administrator

may require, a plan for use of the grant.

‘‘(4) GRANT AMOUNT.—

‘‘(A) NEW MARKETS VENTURE CAPITAL COMPANIES.—The

amount of a grant made under this subsection to a New

Markets Venture Capital company shall be equal to the

resources (in cash or in kind) raised by the company under

section 354(d)(2).

PUBLIC LAW 106–554—APPENDIX H 114 STAT. 2763A–661

‘‘(B) OTHER ENTITIES.—The amount of a grant made

under this subsection to any entity other than a New

Markets Venture Capital company shall be equal to the

resources (in cash or in kind) raised by the entity in accordance with the requirements applicable to New Market Venture Capital companies set forth in section 354(d)(2).

‘‘(5) PRO RATA REDUCTIONS.—If the amount made available

to carry out this section is insufficient for the Administrator

to provide grants in the amounts provided for in paragraph

(4), the Administrator shall make pro rata reductions in the

amounts otherwise payable to each company and entity under

such paragraph.

‘‘(b) SUPPLEMENTAL GRANTS.— ‘‘(1) IN GENERAL.—The Administrator may make supplemental grants to New Markets Venture Capital companies

and to other entities, as authorized by this part under such

terms as the Administrator may require, to provide additional

operational assistance to smaller enterprises financed, or

expected to be financed, by the companies.

‘‘(2) MATCHING REQUIREMENT.—The Administrator may

require, as a condition of any supplemental grant made under

this subsection, that the company or entity receiving the grant

provide from resources (in a cash or in kind), other then those

provided by the Administrator, a matching contribution equal

to the amount of the supplemental grant.

‘‘(c) LIMITATION.—None of the assistance made available under

this section may be used for any overhead or general and administrative expense of a New Markets Venture Capital company or

a specialized small business investment company.

‘‘SEC. 359. BANK PARTICIPATION.

‘‘(a) IN GENERAL.—Except as provided in subsection (b), any

national bank, any member bank of the Federal Reserve System,

and (to the extent permitted under applicable State law) any

insured bank that is not a member of such system, may invest

in any New Markets Venture Capital company, or in any entity

established to invest solely in New Markets Venture Capital companies.

‘‘(b) LIMITATION.—No bank described in subsection (a) may

make investments described in such subsection that are greater

than 5 percent of the capital and surplus of the bank.

‘‘SEC. 360. FEDERAL FINANCING BANK.

‘‘Section 318 shall not apply to any debenture issued by a

New Markets Venture Capital company under this part.

‘‘SEC. 361. REPORTING REQUIREMENT.

‘‘Each New Markets Venture Capital company that participates

in the program established under this part shall provide to the

Administrator such information as the Administrator may require,

including—

‘‘(1) information related to the measurement criteria that

the company proposed in its program application; and

‘‘(2) in each case in which the company under this part

makes an investment in, or a loan or grant to, a business

that is not located in a low-income geographic area, a report

on the number and percentage of employees of the business

who reside in such areas.

114 STAT. 2763A–662 PUBLIC LAW 106–554—APPENDIX H

‘‘SEC. 362. EXAMINATIONS.

‘‘(a) IN GENERAL.—Each New Markets Venture Capital company

that participates in the program established under this part shall

be subject to examinations made at the direction of the Investment

Division of the Small Business Administration in accordance with

this section.

‘‘(b) ASSISTANCE OF PRIVATE SECTOR ENTITIES.—Examinations

under this section may be conducted with the assistance of a private

sector entity that has both the qualifications and the expertise

necessary to conduct such examinations.

‘‘(c) COSTS.—

‘‘(1) ASSESSMENT.—

‘‘(A) IN GENERAL.—The Administrator may assess the

cost of examinations under this section, including compensation of the examiners, against the company examined.

‘‘(B) PAYMENT.—Any company against which the

Administrator assesses costs under this paragraph shall

pay such costs.

‘‘(d) DEPOSIT OF FUNDS.—Funds collected under this section

shall be deposited in the account for salaries and expenses of

the Small Business Administration.

‘‘SEC. 363. INJUNCTIONS AND OTHER ORDERS.

‘‘(a) IN GENERAL.—Whenever, in the judgment of the Administrator, a New Markets Venture Capital company or any other

person has engaged or is about to engage in any acts or practices

which constitute or will constitute a violation of any provision

of this Act, or of any rule or regulation under this Act, or of

any order issued under this Act, the Administrator may make

application to the proper district court of the United States or

a United States court of any place subject to the jurisdiction of

the United States for an order enjoining such acts or practices,

or for an order enforcing compliance with such provision, rule,

regulation, or order, and such courts shall have jurisdiction of

such actions and, upon a showing by the Administrator that such

New Markets Venture Capital company or other person has engaged

or is about to engage in any such acts or practices, a permanent

or temporary injunction, restraining order, or other order, shall

be granted without bond.

‘‘(b) JURISDICTION.—In any proceeding under subsection (a),

the court as a court of equity may, to such extent as it deems

necessary, take exclusive jurisdiction of the New Market Venture

Capital company and the assets thereof, wherever located, and

the court shall have jurisdiction in any such proceeding to appoint

a trustee or receiver to hold or administer under the direction

of the court the assets so possessed.

‘‘(c) ADMINISTRATOR AS TRUSTEE OR RECEIVER.—

‘‘(1) AUTHORITY.—The Administrator may act as trustee

or receiver of a New Markets Venture Capital company.

‘‘(2) Appointment.—Upon request of the Administrator, the

court may appoint the Administrator to act as a trustee or

receiver of a New Markets Venture Capital company unless

the court deems such appointment inequitable or otherwise

inappropriate by reason of the special circumstances involved.

PUBLIC LAW 106–554—APPENDIX H 114 STAT. 2763A–663

‘‘SEC. 364. ADDITIONAL PENALTIES FOR NONCOMPLIANCE.

‘‘(a) IN GENERAL.—With respect to any New Markets Venture

Capital company that violates or fails to comply with any of the

provisions of this Act, of any regulation issued under this Act,

or of any participation agreement entered into under this Act,

the Administrator may in accordance with this section—

‘‘(1) void the participation agreement between the Administrator and the company; and

‘‘(2) cause the company to forfeit all of the rights and

privileges derived by the company from this Act.

‘‘(b) ADJUDICATION OF NONCOMPLIANCE.—

‘‘(1) IN GENERAL.—Before the Administrator may cause a

New Markets Venture Capital company to forfeit rights or

privileges under subsection (a), a court of the United States

of competent jurisdiction must find that the company committed

a violation, or failed to comply, in a cause of action brought

for that purpose in the district, territory, or other place subject

to the jurisdiction of the United States, in which the principal

office of the company is located.

‘‘(2) PARTIES AUTHORIZED TO FILE CAUSES OF ACTION.—

Each cause of action brought by the United States under this

subsection shall be brought by the Administrator or by the

Attorney General.

‘‘SEC. 365. UNLAWFUL ACTS AND OMISSIONS; BREACH OF FIDUCIARY

DUTY.

‘‘(a) PARTIES DEEMED TO COMMIT A VIOLATION.—Whenever any

New Markets Venture Capital company violates any provision of

this Act, of a regulation issued under this Act, or of a participation

agreement entered into under this Act, by reason of its failure

to comply with its terms or by reason of its engaging in any

act or practice that constitutes or will constitute a violation thereof,

such violation shall also be deemed to be a violation and an unlawful

act committed by any person who, directly or indirectly, authorizes,

orders, participates in, causes, brings about, counsels, aids, or abets

in the commission of any acts, practices, or transactions that constitute or will constitute, in whole or in part, such violation.

‘‘(b) FIDUCIARY DUTIES.—It shall be unlawful for any officer,

director, employee, agent, or other participant in the management

or conduct of the affairs of a New Markets Venture Capital company

to engage in any act or practice, or to omit any act or practice,

in breach of the person’s fiduciary duty as such officer, director,

employee, agent, or participant if, as a result thereof, the company

suffers or is in imminent danger of suffering financial loss or

other damage.

‘‘(c) UNLAWFUL ACTS.—Except with the written consent of the

Administrator, it shall be unlawful—

‘‘(1) for any person to take office as an officer, director,

or employee of any New Markets Venture Capital company,

or to become an agent or participant in the conduct of the

affairs or management of such a company, if the person—

‘‘(A) has been convicted of a felony, or any other criminal offense involving dishonesty or breach of trust; or

‘‘(B) has been found civilly liable in damages, or has

been permanently or temporarily enjoined by an order,

judgment, or decree of a court of competent jurisdiction,

114 STAT. 2763A–664 PUBLIC LAW 106–554—APPENDIX H

by reason of any act or practice involving fraud, or breach

of trust; and

‘‘(2) for any person continue to serve in any of the capacities

described in paragraph (1), if— ‘‘(A) the person is convicted of a felony, or any other

criminal offense involving dishonesty or breach of trust;

or ‘‘(B) the person is found civilly liable in damages, or

is permanently or temporarily enjoined by an order, judgment, or decree of a court of competent jurisdiction, by

reason of any act or practice involving fraud or breach

of trust.

‘‘SEC. 366. REMOVAL OR SUSPENSION OF DIRECTORS OR OFFICERS.

‘‘Using the procedures for removing or suspending a director

or an officer of a licensee set forth in section 313 (to the extent

such procedures are not inconsistent with the requirements of this

part), the Administrator may remove or suspend any director or

officer of any New Markets Venture Capital company.

‘‘SEC. 367. REGULATIONS.

‘‘The Administrator may issue such regulations as it deems

necessary to carry out the provisions of this part in accordance

with its purposes.

‘‘SEC. 368. AUTHORIZATIONS OF APPROPRIATIONS.

‘‘(a) IN GENERAL.—There are authorized to be appropriated

for fiscal years 2001 through 2006, to remain available until

expended, the following sums:

‘‘(1) Such subsidy budget authority as may be necessary

to guarantee $150,000,000 of debentures under this part.

‘‘(2) $30,000,000 to make grants under this part.

‘‘(b) FUNDS COLLECTED FOR EXAMINATIONS.—Funds deposited

under section 362(c)(2) are authorized to be appropriated only for

the costs of examinations under section 362 and for the costs

of other oversight activities with respect to the program established

under this part.’’.

(c) CONFORMING AMENDMENT.—Section 20(e)(1)(C) of the Small

Business Act (15 U.S.C. 631 note) is amended by inserting ‘part

A of’ before ‘‘title III’’.

(d) CALCULATION OF MAXIMUM AMOUNT OF SBIC LEVERAGE.—

(1) MAXIMUM LEVERAGE.—Section 303(b)(2) of the Small

Business Investment Act of 1958 (15 U.S.C. 683(b)(2)) is amended to read as follows:

‘‘(2) MAXIMUM LEVERAGE.—

‘‘(A) IN GENERAL.—After March 31, 1993, the maximum

amount of outstanding leverage made available to a company licensed under section 301(c) of this Act shall be

determined by the amount of such company’s private

capital—

‘‘(i) if the company has private capital of not more

than $15,000,000, the total amount of leverage shall

not exceed 300 percent of private capital;

‘‘(ii) if the company has private capital of more

than $15,000,000 but not more than $30,000,000, the

total amount of leverage shall not exceed $45,000,000

plus 200 percent of the amount of private capital over

$15,000,000; and

PUBLIC LAW 106–554—APPENDIX H 114 STAT. 2763A–665

‘‘(iii) if the company has private capital of more

than $30,000,000, the total amount of leverage shall

not exceed $75,000,000 plus 100 percent of the amount

of private capital over $30,000,000 but not to exceed

an additional $15,000,000.

‘‘(B) ADJUSTMENTS.—

‘‘(i) IN GENERAL.—The dollar amounts in clauses

(i), (ii), and (iii) of subparagraph (A) shall be adjusted

annually to reflect increases in the Consumer Price

Index established by the Bureau of Labor Statistics

of the Department of Labor.

‘‘(ii) INITIAL ADJUSTMENTS.—The initial adjustments made under this subparagraph after the date

of the enactment of the Small Business Reauthorization Act of 1937 shall reflect only increases from March

31, 1993.

‘‘(C) INVESTMENTS IN LOW-INCOME GEOGRAPHIC

AREAS.—In calculating the outstanding leverage of a company for the purposes of subparagraph (A), the Administrator shall not include the amount of the cost basis of

any equity investment made by the company in a smaller

enterprise located in a low-income geographic area (as

defined in section 351), to the extent that the total of

such amounts does not exceed 50 percent of the company’s

private capital.’’.

(2) MAXIMUM AGGREGATE LEVERAGE.—Section 303(b)(4) of

the Small Business Investment Act of 1958 (15 U.S.C. 683(b)(4))

is amended by adding at the end the following new subparagraph:

‘‘(D) INVESTMENTS IN LOW-INCOME GEOGRAPHIC

AREAS.—In calculating the aggregate outstanding leverage

of a company for the purposes of subparagraph (A), the

Administrator shall not include the amount of the cost

basis of any equity investment made by the company in

a smaller enterprise located in a low-income geographic

area (as defined in section 351), to the extent that the

total of such amounts does not exceed 50 percent of the

company’s private capital.’’.

(e) BANKRUPTCY EXEMPTION FOR NEW MARKETS VENTURE CAPITAL COMPANIES.—Section 109(b)(2) of title 11, United States Code,

is amended by inserting ‘‘a New Markets Venture Capital company

as defined in section 351 of the Small Business Investment Act

of 1958,’’ after ‘‘homestead association,’’.

(f ) FEDERAL SAVINGS ASSOCIATIONS.—Section 5(c)(4) of the

Home Owners’ Loan Act (12 U.S.C. 1464(c)(4)) is amended by adding

at the end the following:

‘‘(F) NEW MARKETS VENTURE CAPITAL COMPANIES.—A

Federal savings association may invest in stock, obligations,

or other securities of any New Markets Venture Capital

company as defined in section 351 of the Small Business

Investment Act of 1958, except that a Federal savings

association may not make any investment under this

subparagraph if its aggregate outstanding investment

under this subparagraph would exceed 5 percent of the

capital and surplus of such savings association.’’.

114 STAT. 2763A–666 PUBLIC LAW 106–554—APPENDIX H

SEC. 2. BUSINESSLINC GRANTS AND COOPERATIVE AGREEMENTS.

Section 8 of the Small Business Act (15 U.S.C. 637) is amended

by adding at the end the following:

‘‘(n) BUSINESS GRANTS AND COOPERATIVE AGREEMENTS.—

‘‘(1) IN GENERAL.—In accordance with this subsection, the

Administrator may make grants to and enter into cooperative

agreements with any coalition of private entities, public entities,

or any combination of private and public entities—

‘‘(A) to expand business-to-business relationships

between large and small businesses; and

‘‘(B) to provide businesses, directly or indirectly, with

online information and a database of companies that are

interested in mentor-protege programs or communitybased, statewide, or local business development programs.

‘‘(2) MATCHING REQUIREMENT.—Subject to subparagraph

(B), the Administrator may make a grant to a coalition under

paragraph (1) only if the coalition provides for activities

described in paragraph (1)(A) or (1)(B) an amount, either in

kind or in cash, equal to the grant amount.

‘‘(3) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated to carry out this subsection $6,600,000,

to remain available until expended, for each of fiscal years

2001 through 2006.’’.

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–667

APPENDIX I—H.R. 5667

SECTION 1. SHORT TITLE; TABLE OF CONTENTS.

(a) SHORT TITLE.—This Act may be cited as the ‘‘Small Business

Reauthorization Act of 2000’’.

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

is as follows:

Sec. 1. Short title; table of contents.

TITLE I—SMALL BUSINESS INNOVATION RESEARCH PROGRAM

Sec. 101. Short title.

Sec. 102. Findings.

Sec. 103. Extension of SBIR program.

Sec. 104. Annual report.

Sec. 105. Third phase assistance.

Sec. 106. Report on programs for annual performance plan.

Sec. 107. Output and outcome data.

Sec. 108. National Research Council reports.

Sec. 109. Federal agency expenditures for the SBIR program.

Sec. 110. Policy directive modifications.

Sec. 111. Federal and State technology partnership program.

Sec. 112. Mentoring networks.

Sec. 113. Simplified reporting requirements.

Sec. 114. Rural outreach program extension.

TITLE II—BUSINESS LOAN PROGRAMS

Sec. 201. Short title.

Sec. 202. Levels of participation.

Sec. 203. Loan amounts.

Sec. 204. Interest on defaulted loans.

Sec. 205. Prepayment of loans.

Sec. 206. Guarantee fees.

Sec. 207. Lease terms.

Sec. 208. Appraisals for loans secured by real property.

Sec. 209. Sale of guaranteed loans made for export purposes.

Sec. 210. Microloan program.

TITLE III—CERTIFIED DEVELOPMENT COMPANY PROGRAM

Sec. 301. Short title.

Sec. 302. Women-owned businesses.

Sec. 303. Maximum debenture size.

Sec. 304. Fees.

Sec. 305. Premier certified lenders program.

Sec. 306. Sale of certain defaulted loans.

Sec. 307. Loan liquidation.

TITLE IV—CORRECTIONS TO THE SMALL BUSINESS INVESTMENT ACT OF

1958

Sec. 401. Short title.

Sec. 402. Definitions.

Sec. 403. Investment in small business investment companies.

Sec. 404. Subsidy fees.

Sec. 405. Distributions.

Sec. 406. Conforming amendment.

TITLE V—REAUTHORIZATION OF SMALL BUSINESS PROGRAMS

Sec. 501. Short title.

114 STAT. 2763A–668 PUBLIC LAW 106–554—APPENDIX I

Sec. 502. Reauthorization of small business programs.

Sec. 503. Additional reauthorizations.

Sec. 504. Cosponsorship.

TITLE VI—HUBZONE PROGRAM

Subtitle A—HUBZones in Native America

Sec. 601. Short title.

Sec. 602. HUBZone small business concern.

Sec. 603. Qualified HUBZone small business concern.

Sec. 604. Other definitions.

Subtitle B—Other HUBZone Provisions

Sec. 611. Definitions.

Sec. 612. Eligible contracts.

Sec. 613. HUBZone redesignated areas.

Sec. 614. Community development.

Sec. 615. Reference corrections.

TITLE VII—NATIONAL WOMEN’S BUSINESS COUNCIL REAUTHORIZATION

Sec. 701. Short title.

Sec. 702. Membership of the Council.

Sec. 703. Repeal of procurement project.

Sec. 704. Studies and other research.

Sec. 705. Authorization of appropriations.

TITLE VIII—MISCELLANEOUS PROVISIONS

Sec. 801. Loan application processing.

Sec. 802. Application of ownership requirements.

Sec. 803. Subcontracting preference for veterans.

Sec. 804. Small Business Development Center Program funding.

Sec. 805. Surety bonds.

Sec. 806. Size standards.

Sec. 807. Native Hawaiian organizations under section 8(a).

Sec. 808. National Veterans Business Development Corporation correction.

Sec. 809. Private sector resources for SCORE.

Sec. 810. Contract data collection.

Sec. 811. Procurement program for women-owned small business concerns.

TITLE I—SMALL BUSINESS INNOVATION

RESEARCH PROGRAM

SEC. 101. SHORT TITLE.

This title may be cited as the ‘‘Small Business Innovation

Research Program Reauthorization Act of 2000’’.

SEC. 102. FINDINGS.

Congress finds that—

(1) the small business innovation research program established under the Small Business Innovation Development Act

of 1982, and reauthorized by the Small Business Research

and Development Enhancement Act of 1992 (in this title

referred to as the ‘‘SBIR program’’) is highly successful in

involving small businesses in federally funded research and

development;

(2) the SBIR program made the cost-effective and unique

research and development capabilities possessed by the small

businesses of the Nation available to Federal agencies and

departments;

(3) the innovative goods and services developed by small

businesses that participated in the SBIR program have produced innovations of critical importance in a wide variety of

high-technology fields, including biology, medicine, education,

and defense;

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–669

(4) the SBIR program is a catalyst in the promotion of

research and development, the commercialization of innovative

technology, the development of new products and services, and

the continued excellence of this Nation’s high-technology industries; and

(5) the continuation of the SBIR program will provide

expanded opportunities for one of the Nation’s vital resources,

its small businesses, will foster invention, research, and technology, will create jobs, and will increase this Nation’s competitiveness in international markets.

SEC. 103. EXTENSION OF SBIR PROGRAM.

Section 9(m) of the Small Business Act (15 U.S.C. 638(m))

is amended to read as follows: ‘‘(m) TERMINATION.—The authorization to carry out the Small

Business Innovation Research Program established under this section shall terminate on September 30, 2008.’’.

SEC. 104. ANNUAL REPORT.

Section 9(b)(7) of the Small Business Act (15 U.S.C. 638(b)(7))

is amended by striking ‘‘and the Committee on Small Business

of the House of Representatives’’ and inserting ‘‘, and to the Committee on Science and the Committee on Small Business of the House

of Representatives,’’.

SEC. 105. THIRD PHASE ASSISTANCE.

Section 9(e)(4)(C)(i) of the Small Business Act (15 U.S.C.

638(e)(4)(C)(i)) is amended by striking ‘‘; and’’ and inserting ‘‘;

or’’.

SEC. 106. REPORT ON PROGRAMS FOR ANNUAL PERFORMANCE PLAN.

Section 9(g) of the Small Business Act (15 U.S.C. 638(g)) is

amended—

(1) in paragraph (7), by striking ‘‘and’’ at the end;

(2) in paragraph (8), by striking the period at the end

and inserting a semicolon; and

(3) by adding at the end the following:

‘‘(9) include, as part of its annual performance plan as

required by subsections (a) and (b) of section 1115 of title

31, United States Code, a section on its SBIR program, and

shall submit such section to the Committee on Small Business

of the Senate, and the Committee on Science and the Committee

on Small Business of the House of Representatives; and’’.

SEC. 107. OUTPUT AND OUTCOME DATA.

(a) COLLECTION.—Section 9(g) of the Small Business Act (15

U.S.C. 638(g)), as amended by section 106 of this Act, is further

amended by adding at the end the following:

‘‘(10) collect, and maintain in a common format in accordance with subsection (v), such information from awardees as

is necessary to assess the SBIR program, including information

necessary to maintain the database described in subsection

(k).’’.

(b) REPORT TO CONGRESS.—Section 9(b)(7) of the Small Business

Act (15 U.S.C. 638(b)(7)), as amended by section 104 of this Act,

is further amended by inserting before the period at the end ‘‘,

including the data on output and outcomes collected pursuant to

subsections (g)(10) and (o)(9), and a description of the extent to

114 STAT. 2763A–670 PUBLIC LAW 106–554—APPENDIX I

which Federal agencies are providing in a timely manner information needed to maintain the database described in subsection (k)’’.

(c) DATABASE.—Section 9(k) of the Small Business Act (15

U.S.C. 638(k)) is amended to read as follows:

‘‘(k) DATABASE.—

‘‘(1) PUBLIC DATABASE.—Not later than 180 days after the

date of the enactment of the Small Business Innovation

Research Program Reauthorization Act of 2000, the Administrator shall develop, maintain, and make available to the public

a searchable, up-to-date, electronic database that includes—

‘‘(A) the name, size, location, and an identifying number assigned by the Administrator, of each small business

concern that has received a first phase or second phase

SBIR award from a Federal agency;

‘‘(B) a description of each first phase or second phase

SBIR award received by that small business concern,

including—

‘‘(i) an abstract of the project funded by the award,

excluding any proprietary information so identified by

the small business concern;

‘‘(ii) the Federal agency making the award; and

‘‘(iii) the date and amount of the award;

‘‘(C) an identification of any business concern or

subsidiary established for the commercial application of

a product or service for which an SBIR award is made;

and

‘‘(D) information regarding mentors and Mentoring

Networks, as required by section 35(d).

‘‘(2) GOVERNMENT DATABASE.—Not later than 180 days after

the date of the enactment of the Small Business Innovation

Research Program Reauthorization Act of 2000, the Administrator, in consultation with Federal agencies required to have

an SBIR program pursuant to subsection (f )(1), shall develop

and maintain a database to be used solely for SBIR program

evaluation that—

‘‘(A) contains for each second phase award made by

a Federal agency—

‘‘(i) information collected in accordance with paragraph (3) on revenue from the sale of new products

or services resulting from the research conducted under

the award;

‘‘(ii) information collected in accordance with paragraph (3) on additional investment from any source,

other than first phase or second phase SBIR or STTR

awards, to further the research and development conducted under the award; and

‘‘(iii) any other information received in connection

with the award that the Administrator, in conjunction

with the SBIR program managers of Federal agencies,

considers relevant and appropriate;

‘‘(B) includes any narrative information that a small

business concern receiving a second phase award voluntarily submits to further describe the outputs and outcomes

of its awards;

‘‘(C) includes for each applicant for a first phase or

second phase award that does not receive such an award—

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–671

‘‘(i) the name, size, and location, and an identifying

number assigned by the Administration;

‘‘(ii) an abstract of the project; and

‘‘(iii) the Federal agency to which the application

was made;

‘‘(D) includes any other data collected by or available

to any Federal agency that such agency considers may

be useful for SBIR program evaluation; and

‘‘(E) is available for use solely for program evaluation

purposes by the Federal Government or, in accordance

with policy directives issued by the Administration, by

other authorized persons who are subject to a use and

nondisclosure agreement with the Federal Government

covering the use of the database.

‘‘(3) UPDATING INFORMATION FOR DATABASE.—

‘‘(A) IN GENERAL.—A small business concern applying

for a second phase award under this section shall be

required to update information in the database established

under this subsection for any prior second phase award

received by that small business concern. In complying with

this paragraph, a small business concern may apportion

sales or additional investment information relating to more

than one second phase award among those awards, if it

notes the apportionment for each award.

‘‘(B) ANNUAL UPDATES UPON TERMINATION.—A small

business concern receiving a second phase award under

this section shall—

‘‘(i) update information in the database concerning

that award at the termination of the award period;

and

‘‘(ii) be requested to voluntarily update such

information annually thereafter for a period of 5 years.

‘‘(4) PROTECTION OF INFORMATION.—Information provided

under paragraph (2) shall be considered privileged and confidential and not subject to disclosure pursuant to section 552

of title 5, United States Code.

‘‘(5) RULE OF CONSTRUCTION.—Inclusion of information in

the database under this subsection shall not be considered

to be publication for purposes of subsection (a) or (b) of section

102 of title 35, United States Code.’’.

SEC. 108. NATIONAL RESEARCH COUNCIL REPORTS.

(a) STUDY AND RECOMMENDATIONS.—The head of each agency

with a budget of more than $50,000,000 for its SBIR program

for fiscal year 1999, in consultation with the Small Business

Administration, shall, not later than 6 months after the date of

the enactment of this Act, cooperatively enter into an agreement

with the National Academy of Sciences for the National Research

Council to—

(1) conduct a comprehensive study of how the SBIR program has stimulated technological innovation and used small

businesses to meet Federal research and development needs,

including—

(A) a review of the value to the Federal research agencies of the research projects being conducted under the

114 STAT. 2763A–672 PUBLIC LAW 106–554—APPENDIX I

SBIR program, and of the quality of research being conducted by small businesses participating under the program, including a comparison of the value of projects conducted under the SBIR program to those funded by other

Federal research and development expenditures;

(B) to the extent practicable, an evaluation of the economic benefits achieved by the SBIR program, including

the economic rate of return, and a comparison of the economic benefits, including the economic rate of return,

achieved by the SBIR program with the economic benefits,

including the economic rate of return, of other Federal

research and development expenditures;

(C) an evaluation of the noneconomic benefits achieved

by the SBIR program over the life of the program;

(D) a comparison of the allocation for fiscal year 2000

of Federal research and development funds to small

businesses with such allocation for fiscal year 1983, and

an analysis of the factors that have contributed to such

allocation; and

(E) an analysis of whether Federal agencies, in fulfilling their procurement needs, are making sufficient effort

to use small businesses that have completed a second phase

award under the SBIR program; and

(2) make recommendations with respect to—

(A) measures of outcomes for strategic plans submitted

under section 306 of title 5, United States Code, and

performance plans submitted under section 1115 of title

31, United States Code, of each Federal agency participating in the SBIR program;

(B) whether companies who can demonstrate project

feasibility, but who have not received a first phase award,

should be eligible for second phase awards, and the potential impact of such awards on the competitive selection

process of the program;

(C) whether the Federal Government should be permitted to recoup some or all of its expenses if a controlling

interest in a company receiving an SBIR award is sold

to a foreign company or to a company that is not a small

business concern;

(D) how to increase the use by the Federal Government

in its programs and procurements of technology-oriented

small businesses; and

(E) improvements to the SBIR program, if any are

considered appropriate.

(b) PARTICIPATION BY SMALL BUSINESS.—

(1) IN GENERAL.—In a manner consistent with law and

with National Research Council study guidelines and procedures, knowledgeable individuals from the small business

community with experience in the SBIR program shall be

included—

(A) in any panel established by the National Research

Council for the purpose of performing the study conducted

under this section; and

(B) among those who are asked by the National

Research Council to peer review the study.

(2) CONSULTATION.—To ensure that the concerns of small

business are appropriately considered under this subsection,

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–673

the National Research Council shall consult with and consider

the views of the Office of Technology and the Office of Advocacy

of the Small Business Administration and other interested parties, including entities, organizations, and individuals actively

engaged in enhancing or developing the technological capabilities of small business concerns.

(c) PROGRESS REPORTS.—The National Research Council shall

provide semiannual progress reports on the study conducted under

this section to the Committee on Science and the Committee on

Small Business of the House of Representatives, and to the Committee on Small Business of the Senate.

(d) REPORT.—The National Research Council shall transmit

to the heads of agencies entering into an agreement under this

section and to the Committee on Science and the Committee on

Small Business of the House of Representatives, and to the Committee on Small Business of the Senate— (1) not later than 3 years after the date of the enactment

of this Act, a report including the results of the study conducted

under subsection (a)(1) and recommendations made under subsection (a)(2); and

(2) not later than 6 years after that date of the enactment,

an update of such report.

SEC. 109. FEDERAL AGENCY EXPENDITURES FOR THE SBIR PROGRAM.

Section 9(i) of the Small Business Act (15 U.S.C. 638(i)) is

amended—

(1) by striking ‘‘(i) Each Federal’’ and inserting the following:

‘‘(i) ANNUAL REPORTING.— ‘‘(1) IN GENERAL.—Each Federal’’; and

(2) by adding at the end the following:

‘‘(2) CALCULATION OF EXTRAMURAL BUDGET.— ‘‘(A) METHODOLOGY.—Not later than 4 months after

the date of the enactment of each appropriations Act for

a Federal agency required by this section to have an SBIR

program, the Federal agency shall submit to the Administrator a report, which shall include a description of the

methodology used for calculating the amount of the extramural budget of that Federal agency. ‘‘(B) ADMINISTRATOR’S ANALYSIS.—The Administrator

shall include an analysis of the methodology received from

each Federal agency referred to in subparagraph (A) in

the report required by subsection (b)(7).’’.

SEC. 110. POLICY DIRECTIVE MODIFICATIONS.

Section 9( j) of the Small Business Act (15 U.S.C. 638( j)) is

amended by adding at the end the following: ‘‘(3) ADDITIONAL MODIFICATIONS.—Not later than 120 days

after the date of the enactment of the Small Business Innovation Research Program Reauthorization Act of 2000, the

Administrator shall modify the policy directives issued pursuant

to this subsection— ‘‘(A) to clarify that the rights provided for under paragraph (2)(A) apply to all Federal funding awards under

this section, including the first phase (as described in subsection (e)(4)(A)), the second phase (as described in subsection (e)(4)(B)), and the third phase (as described in

subsection (e)(4)(C));

114 STAT. 2763A–674 PUBLIC LAW 106–554—APPENDIX I

‘‘(B) to provide for the requirement of a succinct

commercialization plan with each application for a second

phase award that is moving toward commercialization; ‘‘(C) to require agencies to report to the Administration,

not less frequently than annually, all instances in which

an agency pursued research, development, or production

of a technology developed by a small business concern

using an award made under the SBIR program of that

agency, and determined that it was not practicable to enter

into a follow-on non-SBIR program funding agreement with

the small business concern, which report shall include,

at a minimum— ‘‘(i) the reasons why the follow-on funding agreement with the small business concern was not practicable; ‘‘(ii) the identity of the entity with which the

agency contracted to perform the research, development, or production; and ‘‘(iii) a description of the type of funding agreement

under which the research, development, or production

was obtained; and

‘‘(D) to implement subsection (v), including establishing

standardized procedures for the provision of information

pursuant to subsection (k)(3).’’.

SEC. 111. FEDERAL AND STATE TECHNOLOGY PARTNERSHIP PROGRAM.

(a) FINDINGS.—Congress finds that— (1) programs to foster economic development among small

high-technology firms vary widely among the States;

(2) States that do not aggressively support the development

of small high-technology firms, including participation by small

business concerns in the SBIR program, are at a competitive

disadvantage in establishing a business climate that is conducive to technology development; and

(3) building stronger national, State, and local support

for science and technology research in these disadvantaged

States will expand economic opportunities in the United States,

create jobs, and increase the competitiveness of the United

States in the world market.

(b) FEDERAL AND STATE TECHNOLOGY PARTNERSHIP PROGRAM.— The Small Business Act (15 U.S.C. 631 et seq.) is amended— (1) by redesignating section 34 as section 36; and

(2) by inserting after section 33 the following:

‘‘SEC. 34. FEDERAL AND STATE TECHNOLOGY PARTNERSHIP PROGRAM.

‘‘(a) DEFINITIONS.—In this section and section 35, the following

definitions apply:

‘‘(1) APPLICANT.—The term ‘applicant’ means an entity,

organization, or individual that submits a proposal for an award

or a cooperative agreement under this section.

‘‘(2) BUSINESS ADVICE AND COUNSELING.—The term ‘business advice and counseling’ means providing advice and assistance on matters described in section 35(c)(2)(B) to small business concerns to guide them through the SBIR and STTR

program process, from application to award and successful

completion of each phase of the program.

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–675

‘‘(3) FAST PROGRAM.—The term ‘FAST program’ means

the Federal and State Technology Partnership Program established under this section. ‘‘(4) MENTOR.—The term ‘mentor’ means an individual

described in section 35(c)(2). ‘‘(5) MENTORING NETWORK.—The term ‘Mentoring Network’ means an association, organization, coalition, or other entity

(including an individual) that meets the requirements of section

35(c).‘‘(6) RECIPIENT.—The term ‘recipient’ means a person that

receives an award or becomes party to a cooperative agreement

under this section. ‘‘(7) SBIR PROGRAM.—The term ‘SBIR program’ has the

same meaning as in section 9(e)(4). ‘‘(8) STATE.—The term ‘State’ means each of the several

States, the District of Columbia, the Commonwealth of Puerto

Rico, the Virgin Islands, Guam, and American Samoa. ‘‘(9) STTR PROGRAM.—The term ‘STTR program’ has the

same meaning as in section 9(e)(6).

‘‘(b) ESTABLISHMENT OF PROGRAM.—The Administrator shall

establish a program to be known as the Federal and State Technology Partnership Program, the purpose of which shall be to

strengthen the technological competitiveness of small business concerns in the States.

‘‘(c) GRANTS AND COOPERATIVE AGREEMENTS.—

‘‘(1) JOINT REVIEW.—In carrying out the FAST program

under this section, the Administrator and the SBIR program

managers at the National Science Foundation and the Department of Defense shall jointly review proposals submitted by

applicants and may make awards or enter into cooperative

agreements under this section based on the factors for consideration set forth in paragraph (2), in order to enhance or develop

in a State—

‘‘(A) technology research and development by small

business concerns; ‘‘(B) technology transfer from university research to

technology-based small business concerns;

‘‘(C) technology deployment and diffusion benefiting

small business concerns;

‘‘(D) the technological capabilities of small business

concerns through the establishment or operation of consortia comprised of entities, organizations, or individuals,

including—

‘‘(i) State and local development agencies and entities;

‘‘(ii) representatives of technology-based small

business concerns;

‘‘(iii) industries and emerging companies;

‘‘(iv) universities; and

‘‘(v) small business development centers; and

‘‘(E) outreach, financial support, and technical assistance to technology-based small business concerns participating in or interested in participating in an SBIR program,

including initiatives—

‘‘(i) to make grants or loans to companies to pay

a portion or all of the cost of developing SBIR proposals;

114 STAT. 2763A–676 PUBLIC LAW 106–554—APPENDIX I

‘‘(ii) to establish or operate a Mentoring Network

within the FAST program to provide business advice

and counseling that will assist small business concerns

that have been identified by FAST program participants, program managers of participating SBIR agencies, the Administration, or other entities that are

knowledgeable about the SBIR and STTR programs

as good candidates for the SBIR and STTR programs,

and that would benefit from mentoring, in accordance

with section 35;

‘‘(iii) to create or participate in a training program

for individuals providing SBIR outreach and assistance

at the State and local levels; and

‘‘(iv) to encourage the commercialization of technology developed through SBIR program funding.

‘‘(2) SELECTION CONSIDERATIONS.—In making awards or

entering into cooperative agreements under this section, the

Administrator and the SBIR program managers referred to

in paragraph (1)— ‘‘(A) may only consider proposals by applicants that

intend to use a portion of the Federal assistance provided

under this section to provide outreach, financial support,

or technical assistance to technology-based small business

concerns participating in or interested in participating in

the SBIR program; and ‘‘(B) shall consider, at a minimum— ‘‘(i) whether the applicant has demonstrated that

the assistance to be provided would address unmet

needs of small business concerns in the community,

and whether it is important to use Federal funding

for the proposed activities;

‘‘(ii) whether the applicant has demonstrated that

a need exists to increase the number or success of

small high-technology businesses in the State, as measured by the number of first phase and second phase

SBIR awards that have historically been received by

small business concerns in the State;

‘‘(iii) whether the projected costs of the proposed

activities are reasonable;

‘‘(iv) whether the proposal integrates and coordinates the proposed activities with other State and local

programs assisting small high-technology firms in the

State; and

‘‘(v) the manner in which the applicant will measure the results of the activities to be conducted.

‘‘(3) PROPOSAL LIMIT.—Not more than one proposal may

be submitted for inclusion in the FAST program under this

section to provide services in any one State in any 1 fiscal

year.

‘‘(4) PROCESS.—Proposals and applications for assistance

under this section shall be in such form and subject to such

procedures as the Administrator shall establish.

‘‘(d) COOPERATION AND COORDINATION.—In carrying out the

FAST program under this section, the Administrator shall cooperate

and coordinate with—

‘‘(1) Federal agencies required by section 9 to have an

SBIR program; and

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–677

‘‘(2) entities, organizations, and individuals actively

engaged in enhancing or developing the technological capabilities of small business concerns, including— ‘‘(A) State and local development agencies and entities;

‘‘(B) State committees established under the Experimental Program to Stimulate Competitive Research of the

National Science Foundation (as established under section

113 of the National Science Foundation Authorization Act

of 1988 (42 U.S.C. 1862g));

‘‘(C) State science and technology councils; and

‘‘(D) representatives of technology-based small business

concerns.

‘‘(e) ADMINISTRATIVE REQUIREMENTS.— ‘‘(1) COMPETITIVE BASIS.—Awards and cooperative agreements under this section shall be made or entered into, as

applicable, on a competitive basis. ‘‘(2) MATCHING REQUIREMENTS.—

‘‘(A) IN GENERAL.—The non-Federal share of the cost

of an activity (other than a planning activity) carried out

using an award or under a cooperative agreement under

this section shall be—

‘‘(i) 50 cents for each Federal dollar, in the case

of a recipient that will serve small business concerns

located in one of the 18 States receiving the fewest

SBIR first phase awards (as described in section

9(e)(4)(A));

‘‘(ii) except as provided in subparagraph (B), 1

dollar for each Federal dollar, in the case of a recipient

that will serve small business concerns located in one

of the 16 States receiving the greatest number of such

SBIR first phase awards; and

‘‘(iii) except as provided in subparagraph (B), 75

cents for each Federal dollar, in the case of a recipient

that will serve small business concerns located in a

State that is not described in clause (i) or (ii) that

is receiving such SBIR first phase awards.

‘‘(B) LOW-INCOME AREAS.—The non-Federal share of

the cost of the activity carried out using an award or

under a cooperative agreement under this section shall

be 50 cents for each Federal dollar that will be directly

allocated by a recipient described in subparagraph (A) to

serve small business concerns located in a qualified census

tract, as that term is defined in section 42(d)(5)(C)(ii) of

the Internal Revenue Code of 1986. Federal dollars not

so allocated by that recipient shall be subject to the matching requirements of subparagraph (A).

‘‘(C) TYPES OF FUNDING.—The non-Federal share of

the cost of an activity carried out by a recipient shall

be comprised of not less than 50 percent cash and not

more than 50 percent of indirect costs and in-kind contributions, except that no such costs or contributions may be

derived from funds from any other Federal program.

‘‘(D) RANKINGS.—For purposes of subparagraph (A),

the Administrator shall reevaluate the ranking of a State

once every 2 fiscal years, beginning with fiscal year 2001,

based on the most recent statistics compiled by the

Administrator.

114 STAT. 2763A–678 PUBLIC LAW 106–554—APPENDIX I

‘‘(3) DURATION.—Awards may be made or cooperative agreements entered into under this section for multiple years, not

to exceed 5 years in total.

‘‘(f ) REPORTS.— ‘‘(1) INITIAL REPORT.—Not later than 120 days after the

date of the enactment of the Small Business Innovation

Research Program Reauthorization Act of 2000, the Administrator shall prepare and submit to the Committee on Small

Business of the Senate and the Committee on Science and

the Committee on Small Business of the House of Representatives a report, which shall include, with respect to the FAST

program, including Mentoring Networks— ‘‘(A) a description of the structure and procedures of

the program; ‘‘(B) a management plan for the program; and

‘‘(C) a description of the merit-based review process

to be used in the program.

‘‘(2) ANNUAL REPORTS.—The Administrator shall submit an

annual report to the Committee on Small Business of the

Senate and the Committee on Science and the Committee on

Small Business of the House of Representatives regarding—

‘‘(A) the number and amount of awards provided and

cooperative agreements entered into under the FAST program during the preceding year;

‘‘(B) a list of recipients under this section, including

their location and the activities being performed with the

awards made or under the cooperative agreements entered

into; and

‘‘(C) the Mentoring Networks and the mentoring database, as provided for under section 35, including—

‘‘(i) the status of the inclusion of mentoring

information in the database required by section 9(k);

and

‘‘(ii) the status of the implementation and description of the usage of the Mentoring Networks. ‘‘(g) REVIEWS BY INSPECTOR GENERAL.—

‘‘(1) IN GENERAL.—The Inspector General of the Administration shall conduct a review of—

‘‘(A) the extent to which recipients under the FAST

program are measuring the performance of the activities

being conducted and the results of such measurements;

and

‘‘(B) the overall management and effectiveness of the

FAST program.

‘‘(2) REPORT.—During the first quarter of fiscal year 2004,

the Inspector General of the Administration shall submit a

report to the Committee on Small Business of the Senate and

the Committee on Science and the Committee on Small Business of the House of Representatives on the review conducted

under paragraph (1).

‘‘(h) PROGRAM LEVELS.— ‘‘(1) IN GENERAL.—There is authorized to be appropriated

to carry out the FAST program, including Mentoring Networks,

under this section and section 35, $10,000,000 for each of

fiscal years 2001 through 2005.

‘‘(2) MENTORING DATABASE.—Of the total amount made

available under paragraph (1) for fiscal years 2001 through

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–679

2005, a reasonable amount, not to exceed a total of $500,000,

may be used by the Administration to carry out section 35(d).

‘‘(i) TERMINATION.—The authority to carry out the FAST program under this section shall terminate on September 30, 2005.’’. (c) COORDINATION OF TECHNOLOGY DEVELOPMENT PROGRAMS.— Section 9 of the Small Business Act (15 U.S.C. 638) is amended

by adding at the end the following: ‘‘(u) COORDINATION OF TECHNOLOGY DEVELOPMENT PRO- GRAMS.—

‘‘(1) DEFINITION OF TECHNOLOGY DEVELOPMENT PROGRAM.— In this subsection, the term ‘technology development program’ means—

‘‘(A) the Experimental Program to Stimulate Competitive Research of the National Science Foundation, as established under section 113 of the National Science Foundation

Authorization Act of 1988 (42 U.S.C. 1862g); ‘‘(B) the Defense Experimental Program to Stimulate

Competitive Research of the Department of Defense; ‘‘(C) the Experimental Program to Stimulate Competitive Research of the Department of Energy; ‘‘(D) the Experimental Program to Stimulate Competitive Research of the Environmental Protection Agency; ‘‘(E) the Experimental Program to Stimulate Competitive Research of the National Aeronautics and Space

Administration; ‘‘(F) the Institutional Development Award Program of

the National Institutes of Health; and

‘‘(G) the National Research Initiative Competitive

Grants Program of the Department of Agriculture.

‘‘(2) COORDINATION REQUIREMENTS.—Each Federal agency

that is subject to subsection (f ) and that has established a

technology development program may, in each fiscal year,

review for funding under that technology development

program—

‘‘(A) any proposal to provide outreach and assistance

to one or more small business concerns interested in participating in the SBIR program, including any proposal to

make a grant or loan to a company to pay a portion

or all of the cost of developing an SBIR proposal, from

an entity, organization, or individual located in—

‘‘(i) a State that is eligible to participate in that

program; or

‘‘(ii) a State described in paragraph (3); or

‘‘(B) any proposal for the first phase of the SBIR program, if the proposal, though meritorious, is not funded

through the SBIR program for that fiscal year due to

funding restraints, from a small business concern located

in—

‘‘(i) a State that is eligible to participate in a

technology development program; or

‘‘(ii) a State described in paragraph (3).

‘‘(3) ADDITIONALLY ELIGIBLE STATE.—A State referred to

in subparagraph (A)(ii) or (B)(ii) of paragraph (2) is a State

in which the total value of contracts awarded to small business

concerns under all SBIR programs is less than the total value

of contracts awarded to small business concerns in a majority

of other States, as determined by the Administrator in biennial

114 STAT. 2763A–680 PUBLIC LAW 106–554—APPENDIX I

fiscal years, beginning with fiscal year 2000, based on the

most recent statistics compiled by the Administrator.’’.

SEC. 112. MENTORING NETWORKS.

The Small Business Act (15 U.S.C. 631 et seq.) is amended

by inserting after section 34, as added by section 111(b)(2) of this

Act, the following:

‘‘SEC. 35. MENTORING NETWORKS.

‘‘(a) FINDINGS.—Congress finds that— ‘‘(1) the SBIR and STTR programs create jobs, increase

capacity for technological innovation, and boost international

competitiveness; ‘‘(2) increasing the quantity of applications from all States

to the SBIR and STTR programs would enhance competition

for such awards and the quality of the completed projects;

and ‘‘(3) mentoring is a natural complement to the FAST program of reaching out to new companies regarding the SBIR

and STTR programs as an effective and low-cost way to improve

the likelihood that such companies will succeed in such programs in developing and commercializing their research.

‘‘(b) AUTHORIZATION FOR MENTORING NETWORKS.—The recipient

of an award or participant in a cooperative agreement under section

34 may use a reasonable amount of such assistance for the establishment of a Mentoring Network under this section. ‘‘(c) CRITERIA FOR MENTORING NETWORKS.—A Mentoring Network established using assistance under section 34 shall— ‘‘(1) provide business advice and counseling to high technology small business concerns located in the State or region

served by the Mentoring Network and identified under section

34(c)(1)(E)(ii) as potential candidates for the SBIR or STTR

programs; ‘‘(2) identify volunteer mentors who— ‘‘(A) are persons associated with a small business concern that has successfully completed one or more SBIR

or STTR funding agreements; and ‘‘(B) have agreed to guide small business concerns

through all stages of the SBIR or STTR program process,

including providing assistance relating to— ‘‘(i) proposal writing;

‘‘(ii) marketing;

‘‘(iii) Government accounting;

‘‘(iv) Government audits;

‘‘(v) project facilities and equipment;

‘‘(vi) human resources;

‘‘(vii) third phase partners;

‘‘(viii) commercialization;

‘‘(ix) venture capital networking; and

‘‘(x) other matters relevant to the SBIR and STTR

programs;

‘‘(3) have experience working with small business concerns

participating in the SBIR and STTR programs;

‘‘(4) contribute information to the national database

referred to in subsection (d); and

‘‘(5) agree to reimburse volunteer mentors for out-of-pocket

expenses related to service as a mentor under this section.

‘‘(d) MENTORING DATABASE.—The Administrator shall—

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–681

‘‘(1) include in the database required by section 9(k)(1),

in cooperation with the SBIR, STTR, and FAST programs,

information on Mentoring Networks and mentors participating

under this section, including a description of their areas of

expertise;

‘‘(2) work cooperatively with Mentoring Networks to maintain and update the database;

‘‘(3) take such action as may be necessary to aggressively

promote Mentoring Networks under this section; and

‘‘(4) fulfill the requirements of this subsection either

directly or by contract.’’.

SEC. 113. SIMPLIFIED REPORTING REQUIREMENTS.

Section 9 of the Small Business Act (15 U.S.C. 638), as amended

by this Act, is further amended by adding at the end the following: ‘‘(v) SIMPLIFIED REPORTING REQUIREMENTS.—The Administrator

shall work with the Federal agencies required by this section to

have an SBIR program to standardize reporting requirements for

the collection of data from SBIR applicants and awardees, including

data for inclusion in the database under subsection (k), taking

into consideration the unique needs of each agency, and to the

extent possible, permitting the updating of previously reported

information by electronic means. Such requirements shall be

designed to minimize the burden on small businesses.’’.

SEC. 114. RURAL OUTREACH PROGRAM EXTENSION.

(a) EXTENSION OF TERMINATION DATE.—Section 501(b)(2) of

the Small Business Reauthorization Act of 1997 (15 U.S.C. 638

note; 111 Stat. 2622) is amended by striking ‘‘2001’’ and inserting

‘‘2005’’.

(b) EXTENSION OF AUTHORIZATION OF APPROPRIATIONS.—Section

9(s)(2) of the Small Business Act (15 U.S.C. 638(s)(2)) is amended

by striking ‘‘for fiscal year 1998, 1999, 2000, or 2001’’ and inserting

‘‘for each of the fiscal years 2000 through 2005,’’.

TITLE II—BUSINESS LOAN PROGRAMS

SEC. 201. SHORT TITLE.

This title may be cited as the ‘‘Small Business Loan Improvement Act of 2000’’.

SEC. 202. LEVELS OF PARTICIPATION.

Section 7(a)(2)(A) of the Small Business Act (15 U.S.C.

636(a)(2)(A)) is amended—

(1) in paragraph (i) by striking ‘‘$100,000’’ and inserting

‘‘$150,000’’; and

(2) in paragraph (ii)—

(A) by striking ‘‘80 percent’’ and inserting ‘‘85 percent’’;

and

(B) by striking ‘‘$100,000’’ and inserting ‘‘$150,000’’.

SEC. 203. LOAN AMOUNTS.

Section 7(a)(3)(A) of the Small Business Act (15 U.S.C.

636(a)(3)(A)) is amended by striking ‘‘$750,000,’’ and inserting, ‘‘$1,000,000 (or if the gross loan amount would exceed $2,000,000),’’.

114 STAT. 2763A–682 PUBLIC LAW 106–554—APPENDIX I

SEC. 204. INTEREST ON DEFAULTED LOANS.

Section 7(a)(4)(B) of the Small Business Act (15 U.S.C.

636(a)(4)(B)) is amended by adding at the end the following:

‘‘(iii) APPLICABILITY.—Clauses (i) and (ii) shall not

apply to loans made on or after October 1, 2000.’’.

SEC. 205. PREPAYMENT OF LOANS.

Section 7(a)(4) of the Small Business Act (15 U.S.C. 636(a)(4))

is further amended—

(1) by striking ‘‘(4) INTEREST RATES AND FEES.—’’ and inserting ‘‘(4) INTEREST RATES AND PREPAYMENT CHARGES.—’’; and

(2) by adding at the end the following:

‘‘(C) PREPAYMENT CHARGES.—

‘‘(i) IN GENERAL.—A borrower who prepays any

loan guaranteed under this subsection shall remit to

the Administration a subsidy recoupment fee calculated in accordance with clause (ii) if—

‘‘(I) the loan is for a term of not less than

15 years;

‘‘(II) the prepayment is voluntary;

‘‘(III) the amount of prepayment in any calendar year is more than 25 percent of the outstanding balance of the loan; and

‘‘(IV) the prepayment is made within the first

3 years after disbursement of the loan proceeds.

‘‘(ii) SUBSIDY RECOUPMENT FEE.—The subsidy

recoupment fee charged under clause (i) shall be—

‘‘(I) 5 percent of the amount of prepayment,

if the borrower prepays during the first year after

disbursement;

‘‘(II) 3 percent of the amount of prepayment,

if the borrower prepays during the second year

after disbursement; and

‘‘(III) 1 percent of the amount of prepayment,

if the borrower prepays during the third year after

disbursement.’’.

SEC. 206. GUARANTEE FEES.

Section 7(a)(18) of the Small Business Act (15 U.S.C. 636(a)(18))

is amended to read as follows:

‘‘(18) GUARANTEE FEES.—

‘‘(A) IN GENERAL.—With respect to each loan guaranteed under this subsection (other than a loan that is repayable in 1 year or less), the Administration shall collect

a guarantee fee, which shall be payable by the participating

lender, and may be charged to the borrower, as follows:

‘‘(i) A guarantee fee equal to 2 percent of the

deferred participation share of a total loan amount

that is not more than $150,000.

‘‘(ii) A guarantee fee equal to 3 percent of the

deferred participation share of a total loan amount

that is more than $150,000, but not more than

$700,000.

‘‘(iii) A guarantee fee equal to 3.5 percent of the

deferred participation share of a total loan amount

that is more than $700,000.

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–683

‘‘(B) RETENTION OF CERTAIN FEES.—Lenders participating in the programs established under this subsection may

retain not more than 25 percent of a fee collected under

subparagraph (A)(i).’’.

SEC. 207. LEASE TERMS.

Section 7(a) of the Small Business Act (15 U.S.C. 636(a)) is

further amended by adding at the end the following:

‘‘(28) LEASING.—In addition to such other lease arrangements as may be authorized by the Administration, a borrower

may permanently lease to one or more tenants not more than

20 percent of any property constructed with the proceeds of

a loan guaranteed under this subsection, if the borrower permanently occupies and uses not less than 60 percent of the total

business space in the property.’’.

SEC. 208. APPRAISALS FOR LOANS SECURED BY REAL PROPERTY.

(a) SMALL BUSINESS ACT.—Section 7(a) of the Small Business

Act (15 U.S.C. 636(a)) is amended by adding at the end the following:

‘‘(29) REAL ESTATE APPRAISALS.—With respect to a loan

under this subsection that is secured by commercial real property, an appraisal of such property by a State licensed or

certified appraiser—

‘‘(A) shall be required by the Administration in connection with any such loan for more than $250,000; or

‘‘(B) may be required by the Administration or the

lender in connection with any such loan for $250,000 or

less, if such appraisal is necessary for appropriate evaluation of creditworthiness.’’.

(b) SMALL BUSINESS INVESTMENT ACT OF 1958.—Section

502(3)(E) of the Small Business Investment Act of 1958 (15 U.S.C.

696(3)(E)) is amended—

(1) by striking ‘‘The collateral’’ and inserting the following:

‘‘(i) IN GENERAL.—The collateral’’; and

(2) by adding at the end the following:

‘‘(ii) APPRAISALS.—With respect to commercial real

property provided by the small business concern as

collateral, an appraisal of the property by a State

licensed or certified appraiser—

‘‘(I) shall be required by the Administration

before disbursement of the loan if the estimated

value of that property is more than $250,000; or

‘‘(II) may be required by the Administration

or the lender before disbursement of the loan if

the estimated value of that property is $250,000

or less, and such appraisal is necessary for appropriate evaluation of creditworthiness.’’.

SEC. 209. SALE OF GUARANTEED LOANS MADE FOR EXPORT PURPOSES.

Section 5(f )(1)(C) of the Small Business Act (15 U.S.C.

634(f )(1)(C)) is amended to read as follows:

‘‘(C) each loan, except each loan made under section

7(a)(14), shall have been fully disbursed to the borrower prior

to any sale.’’.

114 STAT. 2763A–684 PUBLIC LAW 106–554—APPENDIX I

SEC. 210. MICROLOAN PROGRAM.

(a) IN GENERAL.—Section 7(m) of the Small Business Act (15

U.S.C. 636(m)) is amended—

(1) in paragraphs (1)(B)(iii) and (3)(E), by striking ‘‘$25,000’’

each place it appears and inserting ‘‘$35,000’’;

(2) in paragraphs (1)(A)(iii)(I), (3)(A)(ii), and (4)(C)(i)(II),

by striking ‘‘$7,500’’ each place it appears and inserting

‘‘$10,000’’;

(3) in paragraph (3)(E), by striking ‘‘$15,000’’ and inserting

‘‘$20,000’’;

(4) in paragraph (5)(A)—

(A) by striking ‘‘25 grants’’ and inserting ‘‘55 grants’’;

and

(B) by striking ‘‘$125,000’’ and inserting ‘‘$200,000’’;

(5) in paragraph (6)(B), by striking ‘‘$10,000’’ and inserting

‘‘$15,000’’; and

(6) in paragraph (7), by striking subparagraph (A) and

inserting the following:

‘‘(A) NUMBER OF PARTICIPANTS.—Under the program

authorized by this subsection, the Administration may

fund, on a competitive basis, not more than 300 intermediaries.’’.

(b) CONFORMING AMENDMENTS.—Section 7(m)(11)(B) of the

Small Business Act (15 U.S.C. 636(m)(11)(B)) is amended by striking

‘‘$25,000’’ and inserting ‘‘$35,000’’.

TITLE III—CERTIFIED DEVELOPMENT

COMPANY PROGRAM

SEC. 301. SHORT TITLE.

This title may be cited as the ‘‘Certified Development Company

Program Improvements Act of 2000’’.

SEC. 302. WOMEN-OWNED BUSINESSES.

Section 501(d)(3)(C) of the Small Business Investment Act of

1958 (15 U.S.C. 695(d)(3)(C)) is amended by inserting before the

comma ‘‘or women-owned business development’’.

SEC. 303. MAXIMUM DEBENTURE SIZE.

Section 502(2) of the Small Business Investment Act of 1958

(15 U.S.C. 696(2)) is amended to read as follows: ‘‘(2) Loans made by the Administration under this section shall be limited to $1,000,000 for each such identifiable small

business concern, except loans meeting the criteria specified

in section 501(d)(3), which shall be limited to $1,300,000 for

each such identifiable small business concern.’’.

SEC. 304. FEES.

Section 503(f ) of the Small Business Investment Act of 1958

(15 U.S.C. 697(f )) is amended to read as follows:

‘‘(f ) EFFECTIVE DATE.—The fees authorized by subsections (b)

and (d) shall apply to financings approved by the Administration

on or after October 1, 1996, but shall not apply to financings

approved by the Administration on or after October 1, 2003.’’.

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–685

SEC. 305. PREMIER CERTIFIED LENDERS PROGRAM.

Section 217(b) of the Small Business Administration Reauthorization and Amendments Act of 1994 (Public Law 103–403, 15

U.S.C. 697 note) (relating to section 508 of the Small Business

Investment Act of 1958) is repealed.

SEC. 306. SALE OF CERTAIN DEFAULTED LOANS.

Section 508 of the Small Business Investment Act of 1958

(15 U.S.C. 697e) is amended—

(1) in subsection (a), by striking ‘‘On a pilot program basis,

the’’ and inserting ‘‘The’’;

(2) by redesignating subsections (d) through (i) as subsections (e) through ( j), respectively;

(3) in subsection (f ) (as redesignated by paragraph (2)),

by striking ‘‘subsection (f )’’ and inserting ‘‘subsection (g)’’;

(4) in subsection (h) (as redesignated by paragraph (2)),

by striking ‘‘subsection (f )’’ and inserting ‘‘subsection (g)’’; and

(5) by inserting after subsection (c) the following:

‘‘(d) SALE OF CERTAIN DEFAULTED LOANS.—

‘‘(1) NOTICE.—If, upon default in repayment, the Administration acquires a loan guaranteed under this section and

identifies such loan for inclusion in a bulk asset sale of

defaulted or repurchased loans or other financings, it shall

give prior notice thereof to any certified development company

which has a contingent liability under this section. The notice

shall be given to the company as soon as possible after the

financing is identified, but not less than 90 days before the

date the Administration first makes any records on such financing available for examination by prospective purchasers prior

to its offering in a package of loans for bulk sale.

‘‘(2) LIMITATIONS.—The Administration shall not offer any

loan described in paragraph (1) as part of a bulk sale unless

it—

‘‘(A) provides prospective purchasers with the opportunity to examine the Administration’s records with respect

to such loan; and ‘‘(B) provides the notice required by paragraph (1).’’.

SEC. 307. LOAN LIQUIDATION.

(a) LIQUIDATION AND FORECLOSURE.—Title V of the Small Business Investment Act of 1958 (15 U.S.C. 695 et seq.) is amended

by adding at the end the following:

‘‘SEC. 510. FORECLOSURE AND LIQUIDATION OF LOANS.

‘‘(a) DELEGATION OF AUTHORITY.—In accordance with this section, the Administration shall delegate to any qualified State or

local development company (as defined in section 503(e)) that meets

the eligibility requirements of subsection (b)(1) the authority to

foreclose and liquidate, or to otherwise treat in accordance with

this section, defaulted loans in its portfolio that are funded with

the proceeds of debentures guaranteed by the Administration under

section 503.

‘‘(b) ELIGIBILITY FOR DELEGATION.—

‘‘(1) REQUIREMENTS.—A qualified State or local development company shall be eligible for a delegation of authority

under subsection (a) if—

‘‘(A) the company—

114 STAT. 2763A–686 PUBLIC LAW 106–554—APPENDIX I

‘‘(i) has participated in the loan liquidation pilot

program established by the Small Business Programs

Improvement Act of 1996 (15 U.S.C. 695 note), as

in effect on the day before promulgation of final regulations by the Administration implementing this section;

‘‘(ii) is participating in the Premier Certified Lenders Program under section 508; or

‘‘(iii) during the 3 fiscal years immediately prior

to seeking such a delegation, has made an average

of not less than 10 loans per year that are funded

with the proceeds of debentures guaranteed under section 503; and

‘‘(B) the company—

‘‘(i) has one or more employees—

‘‘(I) with not less than 2 years of substantive,

decision-making experience in administering the

liquidation and workout of problem loans secured

in a manner substantially similar to loans funded

with the proceeds of debentures guaranteed under

section 503; and

‘‘(II) who have completed a training program

on loan liquidation developed by the Administration in conjunction with qualified State and local

development companies that meet the requirements of this paragraph; or

‘‘(ii) submits to the Administration documentation

demonstrating that the company has contracted with

a qualified third-party to perform any liquidation

activities and secures the approval of the contract by

the Administration with respect to the qualifications

of the contractor and the terms and conditions of liquidation activities.

‘‘(2) CONFIRMATION.—On request the Administration shall

examine the qualifications of any company described in subsection (a) to determine if such company is eligible for the

delegation of authority under this section. If the Administration

determines that a company is not eligible, the Administration

shall provide the company with the reasons for such ineligibility.

‘‘(c) SCOPE OF DELEGATED AUTHORITY.—

‘‘(1) IN GENERAL.—Each qualified State or local development company to which the Administration delegates authority

under section (a) may with respect to any loan described in

subsection (a)—

‘‘(A) perform all liquidation and foreclosure functions,

including the purchase in accordance with this subsection

of any other indebtedness secured by the property securing

the loan, in a reasonable and sound manner according

to commercially accepted practices, pursuant to a liquidation plan approved in advance by the Administration under

paragraph (2)(A);

‘‘(B) litigate any matter relating to the performance

of the functions described in subparagraph (A), except that

the Administration may—

‘‘(i) defend or bring any claim if—

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–687

‘‘(I) the outcome of the litigation may adversely

affect the Administration’s management of the

loan program established under section 502; or ‘‘(II) the Administration is entitled to legal

remedies not available to a qualified State or local

development company and such remedies will

benefit either the Administration or the qualified

State or local development company; or

‘‘(ii) oversee the conduct of any such litigation;

and

‘‘(C) take other appropriate actions to mitigate loan

losses in lieu of total liquidation or foreclosures, including

the restructuring of a loan in accordance with prudent

loan servicing practices and pursuant to a workout plan

approved in advance by the Administration under paragraph (2)(C).

‘‘(2) ADMINISTRATION APPROVAL.—

‘‘(A) LIQUIDATION PLAN.—

‘‘(i) IN GENERAL.—Before carrying out functions

described in paragraph (1)(A), a qualified State or local

development company shall submit to the Administration a proposed liquidation plan.

‘‘(ii) ADMINISTRATION ACTION ON PLAN.—

‘‘(I) TIMING.—Not later than 15 business days

after a liquidation plan is received by the Administration under clause (i), the Administration shall

approve or reject the plan.

‘‘(II) NOTICE OF NO DECISION.—With respect

to any plan that cannot be approved or denied

within the 15-day period required by subclause

(I), the Administration shall within such period

provide in accordance with subparagraph (E)

notice to the company that submitted the plan.

‘‘(iii) ROUTINE ACTIONS.—In carrying out functions

described in paragraph (1)(A), a qualified State or local

development company may undertake routine actions

not addressed in a liquidation plan without obtaining

additional approval from the Administration.

‘‘(B) PURCHASE OF INDEBTEDNESS.—

‘‘(i) IN GENERAL.—In carrying out functions

described in paragraph (1)(A), a qualified State or local

development company shall submit to the Administration a request for written approval before committing

the Administration to the purchase of any other indebtedness secured by the property securing a defaulted

loan.

‘‘(ii) ADMINISTRATION ACTION ON REQUEST.—

‘‘(I) TIMING.—Not later than 15 business days

after receiving a request under clause (i), the

Administration shall approve or deny the request.

‘‘(II) NOTICE OF NO DECISION.—With respect

to any request that cannot be approved or denied

within the 15-day period required by subclause

(I), the Administration shall within such period

provide in accordance with subparagraph (E)

notice to the company that submitted the request.

‘‘(C) WORKOUT PLAN.—

114 STAT. 2763A–688 PUBLIC LAW 106–554—APPENDIX I

‘‘(i) IN GENERAL.—In carrying out functions

described in paragraph (1)(C), a qualified State or local

development company shall submit to the Administration a proposed workout plan.

‘‘(ii) ADMINISTRATION ACTION ON PLAN.—

‘‘(I) TIMING.—Not later than 15 business days

after a workout plan is received by the Administration under clause (i), the Administration shall

approve or reject the plan.

‘‘(II) NOTICE OF NO DECISION.—With respect

to any workout plan that cannot be approved or

denied within the 15-day period required by subclause (I), the Administration shall within such

period provide in accordance with subparagraph

(E) notice to the company that submitted the plan.

‘‘(D) COMPROMISE OF INDEBTEDNESS.—In carrying out

functions described in paragraph (1)(A), a qualified State

or local development company may—

‘‘(i) consider an offer made by an obligor to compromise the debt for less than the full amount owing;

and

‘‘(ii) pursuant to such an offer, release any obligor

or other party contingently liable, if the company

secures the written approval of the Administration.

‘‘(E) CONTENTS OF NOTICE OF NO DECISION.—Any notice

provided by the Administration under subparagraph

(A)(ii)(II), (B)(ii)(II), or (C)(ii)(II)—

‘‘(i) shall be in writing;

‘‘(ii) shall state the specific reason for the Administration’s inability to act on a plan or request;

‘‘(iii) shall include an estimate of the additional

time required by the Administration to act on the

plan or request; and

‘‘(iv) if the Administration cannot act because

insufficient information or documentation was provided

by the company submitting the plan or request, shall

specify the nature of such additional information or

documentation.

‘‘(3) CONFLICT OF INTEREST.—In carrying out functions

described in paragraph (1), a qualified State or local development company shall take no action that would result in an

actual or apparent conflict of interest between the company

(or any employee of the company) and any third party lender,

associate of a third party lender, or any other person participating in a liquidation, foreclosure, or loss mitigation action.

‘‘(d) SUSPENSION OR REVOCATION OF AUTHORITY.—The Administration may revoke or suspend a delegation of authority under

this section to any qualified State or local development company,

if the Administration determines that the company—

‘‘(1) does not meet the requirements of subsection (b)(1);

‘‘(2) has violated any applicable rule or regulation of the

Administration or any other applicable law; or

‘‘(3) fails to comply with any reporting requirement that

may be established by the Administration relating to carrying

out of functions described in paragraph (1).

‘‘(e) REPORT.—

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–689

‘‘(1) IN GENERAL.—Based on information provided by qualified State and local development companies and the Administration, the Administration shall annually submit to the

Committees on Small Business of the House of Representatives

and of the Senate a report on the results of delegation of

authority under this section.

‘‘(2) CONTENTS.—Each report submitted under paragraph

(1) shall include the following information: ‘‘(A) With respect to each loan foreclosed or liquidated

by a qualified State or local development company under

this section, or for which losses were otherwise mitigated

by the company pursuant to a workout plan under this

section—

‘‘(i) the total cost of the project financed with the

loan;‘‘(ii) the total original dollar amount guaranteed

by the Administration; ‘‘(iii) the total dollar amount of the loan at the

time of liquidation, foreclosure, or mitigation of loss; ‘‘(iv) the total dollar losses resulting from the liquidation, foreclosure, or mitigation of loss; and ‘‘(v) the total recoveries resulting from the liquidation, foreclosure, or mitigation of loss, both as a

percentage of the amount guaranteed and the total

cost of the project financed.

‘‘(B) With respect to each qualified State or local

development company to which authority is delegated

under this section, the totals of each of the amounts

described in clauses (i) through (v) of subparagraph (A).

‘‘(C) With respect to all loans subject to foreclosure,

liquidation, or mitigation under this section, the totals

of each of the amounts described in clauses (i) through

(v) of subparagraph (A).

‘‘(D) A comparison between—

‘‘(i) the information provided under subparagraph

(C) with respect to the 12-month period preceding the

date on which the report is submitted; and

‘‘(ii) the same information with respect to loans

foreclosed and liquidated, or otherwise treated, by the

Administration during the same period.

‘‘(E) The number of times that the Administration has

failed to approve or reject a liquidation plan in accordance

with subparagraph (A)(i), a workout plan in accordance

with subparagraph (C)(i), or to approve or deny a request

for purchase of indebtedness under subparagraph (B)(i),

including specific information regarding the reasons for

the Administration’s failure and any delays that resulted.’’.

(b) REGULATIONS.—

(1) IN GENERAL.—Not later than 150 days after the date

of the enactment of this Act, the Administrator shall issue

such regulations as may be necessary to carry out section

510 of the Small Business Investment Act of 1958, as added

by subsection (a) of this section.

(2) TERMINATION OF PILOT PROGRAM.—Beginning on the

date on which final regulations are issued under paragraph

(1), section 204 of the Small Business Programs Improvement

Act of 1996 (15 U.S.C. 695 note) shall cease to have effect.

114 STAT. 2763A–690 PUBLIC LAW 106–554—APPENDIX I

TITLE IV—CORRECTIONS TO THE

SMALL BUSINESS INVESTMENT ACT

OF 1958

SEC. 401. SHORT TITLE.

This title may be cited as the ‘‘Small Business Investment

Corrections Act of 2000’’.

SEC. 402. DEFINITIONS.

(a) SMALL BUSINESS CONCERN.—Section 103(5)(A)(i) of the

Small Business Investment Act of 1958 (15 U.S.C. 662(5)(A)(i))

is amended by inserting before the semicolon at the end the following: ‘‘regardless of the allocation of control during the investment

period under any investment agreement between the business concern and the entity making the investment’’.

(b) LONG TERM.—Section 103 of the Small Business Investment

Act of 1958 (15 U.S.C. 662) is amended—

(1) in paragraph (15), by striking ‘‘and’’ at the end;

(2) in paragraph (16), by striking the period at the end

and inserting ‘‘; and’’; and

(3) by adding at the end the following:

‘‘(17) the term ‘long term’, when used in connection with

equity capital or loan funds invested in any small business

concern or smaller enterprise, means any period of time not

less than 1 year.’’.

SEC. 403. INVESTMENT IN SMALL BUSINESS INVESTMENT COMPANIES.

Section 302(b) of the Small Business Investment Act of 1958

(15 U.S.C. 682(b)) is amended—

(1) by striking ‘‘(b) Notwithstanding’’ and inserting the

following:

‘‘(b) FINANCIAL INSTITUTION INVESTMENTS.—

‘‘(1) CERTAIN BANKS.—Notwithstanding’’; and

(2) by adding at the end the following:

‘‘(2) CERTAIN SAVINGS ASSOCIATIONS.—Notwithstanding any

other provision of law, any Federal savings association may

invest in any one or more small business investment companies,

or in any entity established to invest solely in small business

investment companies, except that in no event may the total

amount of such investments by any such Federal savings

association exceed 5 percent of the capital and surplus of the

Federal savings association.’’.

SEC. 404. SUBSIDY FEES.

(a) DEBENTURES.—Section 303(b) of the Small Business Investment Act of 1958 (15 U.S.C. 683(b)) is amended by striking ‘‘plus

an additional charge of 1 percent per annum which shall be paid

to and retained by the Administration’’ and inserting ‘‘plus, for

debentures obligated after September 30, 2000, an additional

charge, in an amount established annually by the Administration,

of not more than 1 percent per year as necessary to reduce to

zero the cost (as defined in section 502 of the Federal Credit

Reform Act of 1990 (2 U.S.C. 661a)) to the Administration of

purchasing and guaranteeing debentures under this Act, which

shall be paid to and retained by the Administration’’.

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–691

(b) PARTICIPATING SECURITIES.—Section 303(g)(2) of the Small

Business Investment Act of 1958 (15 U.S.C. 683(g)(2)) is amended

by striking ‘‘plus an additional charge of 1 percent per annum

which shall be paid to and retained by the Administration’’ and

inserting ‘‘plus, for participating securities obligated after September 30, 2000, an additional charge, in an amount established

annually by the Administration, of not more than 1 percent per

year as necessary to reduce to zero the cost (as defined in section

502 of the Federal Credit Reform Act of 1990 (2 U.S.C. 661a))

to the Administration of purchasing and guaranteeing participating

securities under this Act, which shall be paid to and retained

by the Administration’’.

SEC. 405. DISTRIBUTIONS.

Section 303(g)(8) of the Small Business Investment Act of 1958

(15 U.S.C. 683(g)(8)) is amended—

(1) by striking ‘‘subchapter s corporation’’ and inserting

‘‘subchapter S corporation’’;

(2) by striking ‘‘the end of any calendar quarter based

on a quarterly’’ and inserting ‘‘any time during any calendar

quarter based on an’’; and

(3) by striking ‘‘quarterly distributions for a calendar year,’’

and inserting ‘‘interim distributions for a calendar year,’’.

SEC. 406. CONFORMING AMENDMENT.

Section 310(c)(4) of the Small Business Investment Act of 1958

(15 U.S.C. 687b(c)(4)) is amended by striking ‘‘five years’’ and inserting ‘‘1 year’’.

TITLE V—REAUTHORIZATION OF SMALL

BUSINESS PROGRAMS

SEC. 501. SHORT TITLE.

This title may be cited as the ‘‘Small Business Programs

Reauthorization Act of 2000’’.

SEC. 502. REAUTHORIZATION OF SMALL BUSINESS PROGRAMS.

Section 20 of the Small Business Act (15 U.S.C. 631 note)

is amended by adding at the end the following:

‘‘(g) FISCAL YEAR 2001.—

‘‘(1) PROGRAM LEVELS.—The following program levels are

authorized for fiscal year 2001:

‘‘(A) For the programs authorized by this Act, the

Administration is authorized to make—

‘‘(i) $45,000,000 in technical assistance grants as

provided in section 7(m); and

‘‘(ii) $60,000,000 in direct loans, as provided in

7(m).

‘‘(B) For the programs authorized by this Act, the

Administration is authorized to make $19,050,000,000 in

deferred participation loans and other financings. Of such

sum, the Administration is authorized to make—

‘‘(i) $14,500,000,000 in general business loans as

provided in section 7(a);

114 STAT. 2763A–692 PUBLIC LAW 106–554—APPENDIX I

‘‘(ii) $4,000,000,000 in financings as provided in

section 7(a)(13) of this Act and section 504 of the

Small Business Investment Act of 1958; ‘‘(iii) $500,000,000 in loans as provided in section

7(a)(21); and

‘‘(iv) $50,000,000 in loans as provided in section

7(m).

‘‘(C) For the programs authorized by title III of the

Small Business Investment Act of 1958, the Administration

is authorized to make—

‘‘(i) $2,500,000,000 in purchases of participating

securities; and

‘‘(ii) $1,500,000,000 in guarantees of debentures.

‘‘(D) For the programs authorized by part B of title

IV of the Small Business Investment Act of 1958, the

Administration is authorized to enter into guarantees not

to exceed $4,000,000,000 of which not more than 50 percent

may be in bonds approved pursuant to section 411(a)(3)

of that Act.

‘‘(E) The Administration is authorized to make grants

or enter cooperative agreements for a total amount of

$5,000,000 for the Service Corps of Retired Executives program authorized by section 8(b)(1).

‘‘(2) ADDITIONAL AUTHORIZATIONS.—

‘‘(A) There are authorized to be appropriated to the

Administration for fiscal year 2001 such sums as may

be necessary to carry out the provisions of this Act not

elsewhere provided for, including administrative expenses

and necessary loan capital for disaster loans pursuant to

section 7(b), and to carry out title IV of the Small Business

Investment Act of 1958, including salaries and expenses

of the Administration.

‘‘(B) Notwithstanding any other provision of this paragraph, for fiscal year 2001—

‘‘(i) no funds are authorized to be used as loan

capital for the loan program authorized by section

7(a)(21) except by transfer from another Federal

department or agency to the Administration, unless

the program level authorized for general business loans

under paragraph (1)(B)(i) is fully funded; and

‘‘(ii) the Administration may not approve loans

on its own behalf or on behalf of any other Federal

department or agency, by contract or otherwise, under

terms and conditions other than those specifically

authorized under this Act or the Small Business Investment Act of 1958, except that it may approve loans

under section 7(a)(21) of this Act in gross amounts

of not more than $1,250,000.

‘‘(h) FISCAL YEAR 2002.—

‘‘(1) PROGRAM LEVELS.—The following program levels are

authorized for fiscal year 2002: ‘‘(A) For the programs authorized by this Act, the

Administration is authorized to make—

‘‘(i) $60,000,000 in technical assistance grants as

provided in section 7(m); and

‘‘(ii) $80,000,000 in direct loans, as provided in

7(m).

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–693

‘‘(B) For the programs authorized by this Act, the Administration is authorized to make $20,050,000,000 in

deferred participation loans and other financings. Of such

sum, the Administration is authorized to make—

‘‘(i) $15,000,000,000 in general business loans as

provided in section 7(a);

‘‘(ii) $4,500,000,000 in financings as provided in

section 7(a)(13) of this Act and section 504 of the

Small Business Investment Act of 1958;

‘‘(iii) $500,000,000 in loans as provided in section

7(a)(21); and

‘‘(iv) $50,000,000 in loans as provided in section

7(m).

‘‘(C) For the programs authorized by title III of the

Small Business Investment Act of 1958, the Administration

is authorized to make—

‘‘(i) $3,500,000,000 in purchases of participating

securities; and

‘‘(ii) $2,500,000,000 in guarantees of debentures.

‘‘(D) For the programs authorized by part B of title

IV of the Small Business Investment Act of 1958, the

Administration is authorized to enter into guarantees not

to exceed $5,000,000,000 of which not more than 50 percent

may be in bonds approved pursuant to section 411(a)(3)

of that Act.

‘‘(E) The Administration is authorized to make grants

or enter cooperative agreements for a total amount of

$6,000,000 for the Service Corps of Retired Executives program authorized by section 8(b)(1).

‘‘(2) ADDITIONAL AUTHORIZATIONS.—

‘‘(A) There are authorized to be appropriated to the

Administration for fiscal year 2002 such sums as may

be necessary to carry out the provisions of this Act not

elsewhere provided for, including administrative expenses

and necessary loan capital for disaster loans pursuant to

section 7(b), and to carry out title IV of the Small Business

Investment Act of 1958, including salaries and expenses

of the Administration.

‘‘(B) Notwithstanding any other provision of this paragraph, for fiscal year 2002—

‘‘(i) no funds are authorized to be used as loan

capital for the loan program authorized by section

7(a)(21) except by transfer from another Federal

department or agency to the Administration, unless

the program level authorized for general business loans

under paragraph (1)(B)(i) is fully funded; and

‘‘(ii) the Administration may not approve loans

on its own behalf or on behalf of any other Federal

department or agency, by contract or otherwise, under

terms and conditions other than those specifically

authorized under this Act or the Small Business Investment Act of 1958, except that it may approve loans

under section 7(a)(21) of this Act in gross amounts

of not more than $1,250,000.

‘‘(i) FISCAL YEAR 2003.— ‘‘(1) PROGRAM LEVELS.—The following program levels are

authorized for fiscal year 2003:

114 STAT. 2763A–694 PUBLIC LAW 106–554—APPENDIX I

‘‘(A) For the programs authorized by this Act, the

Administration is authorized to make—

‘‘(i) $70,000,000 in technical assistance grants as

provided in section 7(m); and

‘‘(ii) $100,000,000 in direct loans, as provided in

7(m).

‘‘(B) For the programs authorized by this Act, the

Administration is authorized to make $21,550,000,000 in

deferred participation loans and other financings. Of such

sum, the Administration is authorized to make—

‘‘(i) $16,000,000,000 in general business loans as

provided in section 7(a);

‘‘(ii) $5,000,000,000 in financings as provided in

section 7(a)(13) of this Act and section 504 of the

Small Business Investment Act of 1958;

‘‘(iii) $500,000,000 in loans as provided in section

7(a)(21); and

‘‘(iv) $50,000,000 in loans as provided in section

7(m).

‘‘(C) For the programs authorized by title III of the

Small Business Investment Act of 1958, the Administration

is authorized to make—

‘‘(i) $4,000,000,000 in purchases of participating

securities; and

‘‘(ii) $3,000,000,000 in guarantees of debentures.

‘‘(D) For the programs authorized by part B of title

IV of the Small Business Investment Act of 1958, the

Administration is authorized to enter into guarantees not

to exceed $6,000,000,000 of which not more than 50 percent

may be in bonds approved pursuant to section 411(a)(3)

of that Act.

‘‘(E) The Administration is authorized to make grants

or enter into cooperative agreements for a total amount

of $7,000,000 for the Service Corps of Retired Executives

program authorized by section 8(b)(1).

‘‘(2) ADDITIONAL AUTHORIZATIONS.—

‘‘(A) There are authorized to be appropriated to the

Administration for fiscal year 2003 such sums as may

be necessary to carry out the provisions of this Act not

elsewhere provided for, including administrative expenses

and necessary loan capital for disaster loans pursuant to

section 7(b), and to carry out title IV of the Small Business

Investment Act of 1958, including salaries and expenses

of the Administration.

‘‘(B) Notwithstanding any other provision of this paragraph, for fiscal year 2003—

‘‘(i) no funds are authorized to be used as loan

capital for the loan program authorized by section

7(a)(21) except by transfer from another Federal

department or agency to the Administration, unless

the program level authorized for general business loans

under paragraph (1)(B)(i) is fully funded; and

‘‘(ii) the Administration may not approve loans

on its own behalf or on behalf of any other Federal

department or agency, by contract or otherwise, under

terms and conditions other than those specifically

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–695

authorized under this Act or the Small Business Investment Act of 1958, except that it may approve loans

under section 7(a)(21) of this Act in gross amounts

of not more than $1,250,000.’’.

SEC. 503. ADDITIONAL REAUTHORIZATIONS.

(a) DRUG-FREE WORKPLACE PROGRAM.—Section 27 of the Small

Business Act (15 U.S.C. 654) is amended— (1) in the section heading, by striking ‘‘DRUG-FREE WORK- PLACE DEMONSTRATION PROGRAM’’ and inserting ‘‘PAUL D. COVERDELL DRUG-FREE WORKPLACE PROGRAM’’; and

(2) in subsection (g)(1), by striking ‘‘$10,000,000 for fiscal

years 1999 and 2000’’ and inserting ‘‘$5,000,000 for each of

fiscal years 2001 through 2003’’. (b) HUBZONE PROGRAM.—Section 31 of the Small Business

Act (15 U.S.C. 657a) is amended by adding at the end the following: ‘‘(d) AUTHORIZATION OF APPROPRIATIONS.—There is authorized

to be appropriated to carry out the program established by this

section $10,000,000 for each of fiscal years 2001 through 2003.’’.

(c) VERY SMALL BUSINESS CONCERNS PROGRAM.—Section 304(i)

of the Small Business Administration Reauthorization and Amendments Act of 1994 (Public Law 103–403; 15 U.S.C. 644 note) is

amended by striking ‘‘September 30, 2000’’ and inserting ‘‘September 30, 2003’’.

(d) SOCIALLY AND ECONOMICALLY DISADVANTAGED BUSINESSES

PROGRAM.—Section 7102(c) of the Federal Acquisition Streamlining

Act of 1994 (Public Law 103–355; 15 U.S.C. 644 note) is amended

by striking ‘‘September 30, 2000’’ and inserting ‘‘September 30,

2003’’.

(e) SBDC SERVICES.—Section 21(c)(3)(T) of the Small Business

Act (15 U.S.C. 648(c)(3)(T)) is amended by striking ‘‘2000’’ and

inserting ‘‘2003’’.

SEC. 504. COSPONSORSHIP.

(a) IN GENERAL.—Section 8(b)(1)(A) of the Small Business Act

(15 U.S.C. 637(b)(1)(A)) is amended to read as follows:

‘‘(1)(A) to provide—

‘‘(i) technical, managerial, and informational aids to

small business concerns—

‘‘(I) by advising and counseling on matters in

connection with Government procurement and policies,

principles, and practices of good management;

‘‘(II) by cooperating and advising with—

‘‘(aa) voluntary business, professional, educational, and other nonprofit organizations,

associations, and institutions (except that the

Administration shall take such actions as it determines necessary to ensure that such cooperation

does not constitute or imply an endorsement by

the Administration of the organization or its products or services, and shall ensure that it receives

appropriate recognition in all printed materials);

and

‘‘(bb) other Federal and State agencies;

‘‘(III) by maintaining a clearinghouse for information on managing, financing, and operating small business enterprises; and

114 STAT. 2763A–696 PUBLIC LAW 106–554—APPENDIX I

‘‘(IV) by disseminating such information, including

through recognition events, and by other activities that

the Administration determines to be appropriate; and

‘‘(ii) through cooperation with a profit-making concern

(referred to in this paragraph as a ‘cosponsor’), training,

information, and education to small business concerns,

except that the Administration shall—

‘‘(I) take such actions as it determines to be appropriate to ensure that—

‘‘(aa) the Administration receives appropriate

recognition and publicity;

‘‘(bb) the cooperation does not constitute or

imply an endorsement by the Administration of

any product or service of the cosponsor;

‘‘(cc) unnecessary promotion of the products

or services of the cosponsor is avoided; and

‘‘(dd) utilization of any one cosponsor in a

marketing area is minimized; and

‘‘(II) develop an agreement, executed on behalf of

the Administration by an employee of the Administration in Washington, the District of Columbia, that provides, at a minimum, that—

‘‘(aa) any printed material to announce the

cosponsorship or to be distributed at the

cosponsored activity, shall be approved in advance

by the Administration;

‘‘(bb) the terms and conditions of the cooperation shall be specified;

‘‘(cc) only minimal charges may be imposed

on any small business concern to cover the direct

costs of providing the assistance;

‘‘(dd) the Administration may provide to the

cosponsorship mailing labels, but not lists of names

and addresses of small business concerns compiled

by the Administration;

‘‘(ee) all printed materials containing the

names of both the Administration and the

cosponsor shall include a prominent disclaimer

that the cooperation does not constitute or imply

an endorsement by the Administration of any product or service of the cosponsor; and

‘‘(ff) the Administration shall ensure that it

receives appropriate recognition in all cosponsorship printed materials.’’.

(b) EXTENSION OF COSPONSORSHIP AUTHORITY.—Section

401(a)(2) of the Small Business Administration Reauthorization

and Amendments Act of 1994 (15 U.S.C. 637 note) is amended

by striking ‘‘September 30, 2000’’ and inserting ‘‘September 30,

2003’’.

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–697

TITLE VI—HUBZONE PROGRAM

Subtitle A—HUBZones in Native America

SEC. 601. SHORT TITLE.

This subtitle may be cited as the ‘‘HUBZones in Native America

Act of 2000’’.

SEC. 602. HUBZONE SMALL BUSINESS CONCERN.

Section 3(p)(3) of the Small Business Act (15 U.S.C. 632(p)(3))

is amended to read as follows:

‘‘(3) HUBZONE SMALL BUSINESS CONCERN.—The term

‘HUBZone small business concern’ means—

‘‘(A) a small business concern that is owned and controlled by one or more persons, each of whom is a United

States citizen;

‘‘(B) a small business concern that is—

‘‘(i) an Alaska Native Corporation owned and controlled by Natives (as determined pursuant to section

29(e)(1) of the Alaska Native Claims Settlement Act

(43 U.S.C. 1626(e)(1))); or

‘‘(ii) a direct or indirect subsidiary corporation,

joint venture, or partnership of an Alaska Native Corporation qualifying pursuant to section 29(e)(1) of the

Alaska Native Claims Settlement Act (43 U.S.C.

1626(e)(1)), if that subsidiary, joint venture, or partnership is owned and controlled by Natives (as determined

pursuant to section 29(e)(2)) of the Alaska Native

Claims Settlement Act (43 U.S.C. 1626(e)(2))); or

‘‘(C) a small business concern—

‘‘(i) that is wholly owned by one or more Indian

tribal governments, or by a corporation that is wholly

owned by one or more Indian tribal governments; or

‘‘(ii) that is owned in part by one or more Indian

tribal governments, or by a corporation that is wholly

owned by one or more Indian tribal governments, if

all other owners are either United States citizens or

small business concerns.’’.

SEC. 603. QUALIFIED HUBZONE SMALL BUSINESS CONCERN.

(a) IN GENERAL.—Section 3(p)(5)(A)(i) of the Small Business

Act (15 U.S.C. 632(p)(5)(A)(i)) is amended by striking subclauses

(I) and (II) and inserting the following:

‘‘(I) it is a HUBZone small business concern—

‘‘(aa) pursuant to subparagraph (A) or (B)

of paragraph (3), and that its principal office

is located in a HUBZone and not fewer than

35 percent of its employees reside in a

HUBZone; or

‘‘(bb) pursuant to paragraph (3)(C), and

not fewer than 35 percent of its employees

engaged in performing a contract awarded to

the small business concern on the basis of

a preference provided under section 31(b)

reside within any Indian reservation governed

114 STAT. 2763A–698 PUBLIC LAW 106–554—APPENDIX I

by one or more of the tribal government owners, or reside within any HUBZone adjoining

any such Indian reservation;

‘‘(II) the small business concern will attempt

to maintain the applicable employment percentage

under subclause (I) during the performance of any

contract awarded to the small business concern

on the basis of a preference provided under section

31(b); and’’.

(b) CLARIFYING AMENDMENT.—Section 3(p)(5)(D)(i) of the Small

Business Act (15 U.S.C. 632(p)(5)(D)(i)) is amended by inserting

‘‘once the Administrator has made the certification required by

subparagraph (A)(i) regarding a qualified HUBZone small business

concern and has determined that subparagraph (A)(ii) does not

apply to that concern,’’ before ‘‘include’’.

SEC. 604. OTHER DEFINITIONS.

Section 3(p) of the Small Business Act (15 U.S.C. 632(p)) is

amended by adding at the end the following:

‘‘(6) NATIVE AMERICAN SMALL BUSINESS CONCERNS.—

‘‘(A) ALASKA NATIVE CORPORATION.—The term ‘Alaska

Native Corporation’ has the same meaning as the term

‘Native Corporation’ in section 3 of the Alaska Native

Claims Settlement Act (43 U.S.C. 1602).

‘‘(B) ALASKA NATIVE VILLAGE.—The term ‘Alaska Native

Village’ has the same meaning as the term ‘Native village’

in section 3 of the Alaska Native Claims Settlement Act

(43 U.S.C. 1602).

‘‘(C) INDIAN RESERVATION.—The term ‘Indian

reservation’—

‘‘(i) has the same meaning as the term ‘Indian

country’ in section 1151 of title 18, United States Code,

except that such term does not include—

‘‘(I) any lands that are located within a State

in which a tribe did not exercise governmental

jurisdiction on the date of the enactment of this

paragraph, unless that tribe is recognized after

that date of the enactment by either an Act of

Congress or pursuant to regulations of the Secretary of the Interior for the administrative recognition that an Indian group exists as an Indian

tribe (part 83 of title 25, Code of Federal Regulations); and

‘‘(II) lands taken into trust or acquired by

an Indian tribe after the date of the enactment

of this paragraph if such lands are not located

within the external boundaries of an Indian reservation or former reservation or are not contiguous to the lands held in trust or restricted status

on that date of the enactment; and

‘‘(ii) in the State of Oklahoma, means lands that—

‘‘(I) are within the jurisdictional areas of an

Oklahoma Indian tribe (as determined by the Secretary of the Interior); and

‘‘(II) are recognized by the Secretary of the

Interior as eligible for trust land status under

part 151 of title 25, Code of Federal Regulations

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–699

(as in effect on the date of the enactment of this

paragraph).’’.

Subtitle B—Other HUBZone Provisions

SEC. 611. DEFINITIONS.

(a) QUALIFIED CENSUS TRACT.—Section 3(p)(4)(A) of the Small

Business Act (15 U.S.C. 632(p)(4)(A)) is amended by striking ‘‘(I)’’.

(b) QUALIFIED NONMETROPOLITAN COUNTY.—Section 3(p)(4) of

the Small Business Act (15 U.S.C. 632(p)(4)) is amended by striking

subparagraph (B) and inserting the following:

‘‘(B) QUALIFIED NONMETROPOLITAN COUNTY.—The term

‘qualified nonmetropolitan county’ means any county—

‘‘(i) that was not located in a metropolitan statistical area (as defined in section 143(k)(2)(B) of the

Internal Revenue Code of 1986) at the time of the

most recent census taken for purposes of selecting

qualified census tracts under section 42(d)(5)(C)(ii) of

the Internal Revenue Code of 1986; and

‘‘(ii) in which—

‘‘(I) the median household income is less than

80 percent of the nonmetropolitan State median

household income, based on the most recent data

available from the Bureau of the Census of the

Department of Commerce; or

‘‘(II) the unemployment rate is not less than

140 percent of the Statewide average unemployment rate for the State in which the county is

located, based on the most recent data available

from the Secretary of Labor.’’.

SEC. 612. ELIGIBLE CONTRACTS.

(a) COMMODITIES CONTRACTS.—Section 31(b)(3) of the Small

Business Act (15 U.S.C. 657a(b)(3)) is amended— (1) by striking ‘‘In any’’ and inserting the following:

‘‘(A) IN GENERAL.—Subject to subparagraph (B), in

any’’; and

(2) by adding at the end the following:

‘‘(B) PROCUREMENT OF COMMODITIES.—For purchases

by the Secretary of Agriculture of agricultural commodities,

the price evaluation preference shall be—

‘‘(i) 10 percent, for the portion of a contract to

be awarded that is not greater than 25 percent of

the total volume being procured for each commodity

in a single invitation;

‘‘(ii) 5 percent, for the portion of a contract to

be awarded that is greater than 25 percent, but not

greater than 40 percent, of the total volume being

procured for each commodity in a single invitation;

and

‘‘(iii) zero, for the portion of a contract to be

awarded that is greater than 40 percent of the total

volume being procured for each commodity in a single

invitation.

‘‘(C) TREATMENT OF PREFERENCE.—A contract awarded

to a HUBZone small business concern under a preference

114 STAT. 2763A–700 PUBLIC LAW 106–554—APPENDIX I

described in subparagraph (B) shall not be counted toward

the fulfillment of any requirement partially set aside for

competition restricted to small business concerns.’’. (b) DEFINITIONS.—Section 3(p) of the Small Business Act (15

U.S.C. 632(p)), as amended by this Act, is amended— (1) in paragraph (5)(A)(i)(III)— (A) in item (aa), by striking ‘‘and’’ at the end; and

(B) by adding at the end the following: ‘‘(cc) in the case of a contract for the

procurement by the Secretary of Agriculture

of agricultural commodities, none of the

commodity being procured will be obtained by

the prime contractor through a subcontract

for the purchase of the commodity in substantially the final form in which it is to be supplied to the Government; and’’; and

(2) by adding at the end the following:

‘‘(7) AGRICULTURAL COMMODITY.—The term ‘agricultural

commodity’ has the same meaning as in section 102 of the

Agricultural Trade Act of 1978 (7 U.S.C. 5602).’’.

SEC. 613. HUBZONE REDESIGNATED AREAS.

Section 3(p) of the Small Business Act (15 U.S.C. 632(p)) is

amended—

(1) in paragraph (1)— (A) in subparagraph (B), by striking ‘‘or’’ at the end;

(B) in subparagraph (C), by striking the period at

the end and inserting ‘‘; or’’; and

(C) by adding at the end the following:

‘‘(D) redesignated areas.’’; and

(2) in paragraph (4), by adding at the end the following: ‘‘(C) REDESIGNATED AREA.—The term ‘redesignated

area’ means any census tract that ceases to be qualified

under subparagraph (A) and any nonmetropolitan county

that ceases to be qualified under subparagraph (B), except

that a census tract or a nonmetropolitan county may be

a ‘redesignated area’ only for the 3-year period following

the date on which the census tract or nonmetropolitan

county ceased to be so qualified.’’.

SEC. 614. COMMUNITY DEVELOPMENT.

Section 3(p) of the Small Business Act (15 U.S.C. 632(p)),

as amended by this Act, is amended— (1) in paragraph (3)— (A) in subparagraph (B), by striking ‘‘or’’ at the end;

(B) in subparagraph (C), by striking the period at

the end and inserting ‘‘; or’’; and

(C) by adding at the end the following:

‘‘(D) a small business concern that is—

‘‘(i) wholly owned by a community development

corporation that has received financial assistance

under part 1 of subchapter A of the Community Economic Development Act of 1981 (42 U.S.C. 9805 et

seq.); or

‘‘(ii) owned in part by one or more community

development corporations, if all other owners are either

United States citizens or small business concerns.’’;

and

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–701

(2) in paragraph (5)(A)(i)(I)(aa), by striking ‘‘subparagraph

(A) or (B)’’ and inserting ‘‘subparagraph (A), (B), or (D)’’.

SEC. 615. REFERENCE CORRECTIONS.

(a) SECTION 3.—Section 3(p)(5)(C) of the Small Business Act

(15 U.S.C. 632(p)(5)(C)) is amended by striking ‘‘subclause (IV)

and (V) of subparagraph (A)(i)’’ and inserting ‘‘items (aa) and (bb)

of subparagraph (A)(i)(III)’’. (b) SECTION 8.—Section 8(d)(4)(D) of the Small Business Act

(15 U.S.C. 637(d)(4)(D)) is amended by inserting ‘‘qualified

HUBZone small business concerns,’’ after ‘‘small business concerns,’’.

TITLE VII—NATIONAL WOMEN’S

BUSINESS COUNCIL REAUTHORIZATION

SEC. 701. SHORT TITLE.

This title may be cited as the ‘‘National Women’s Business

Council Reauthorization Act of 2000’’.

SEC. 702. MEMBERSHIP OF THE COUNCIL.

Section 407 of the Women’s Business Ownership Act of 1988

(15 U.S.C. 631 note) is amended—

(1) in subsection (a), by striking ‘‘Not later’’ and all that

follows through ‘‘the President’’ and inserting ‘‘The President’’;

(2) in subsection (b)—

(A) by striking ‘‘Not later’’ and all that follows through

‘‘the Administrator’’ and inserting ‘‘The Administrator’’; and

(B) by striking ‘‘the Assistant Administrator of the

Office of Women’s Business Ownership and’’;

(3) in subsection (d), by striking ‘‘, except that’’ and all

that follows through the end of the subsection and inserting

a period; and

(4) in subsection (h), by striking ‘‘Not later’’ and all that

follows through ‘‘the Administrator’’ and inserting ‘‘The

Administrator’’.

SEC. 703. REPEAL OF PROCUREMENT PROJECT.

Section 409 of the Women’s Business Ownership Act of 1988

(15 U.S.C. 631 note) is repealed.

SEC. 704. STUDIES AND OTHER RESEARCH.

Section 410 of the Women’s Business Ownership Act of 1988

(15 U.S.C. 631 note) is amended to read as follows:

‘‘SEC. 409. STUDIES AND OTHER RESEARCH.

‘‘(a) IN GENERAL.—The Council may conduct such studies and

other research relating to the award of Federal prime contracts

and subcontracts to women-owned businesses, to access to credit

and investment capital by women entrepreneurs, or to other issues

relating to women-owned businesses, as the Council determines

to be appropriate.

‘‘(b) CONTRACT AUTHORITY.—In conducting any study or other

research under this section, the Council may contract with one

or more public or private entities.’’.

114 STAT. 2763A–702 PUBLIC LAW 106–554—APPENDIX I

SEC. 705. AUTHORIZATION OF APPROPRIATIONS.

Section 411 of the Women’s Business Ownership Act of 1988

(15 U.S.C. 631 note) is amended to read as follows:

‘‘SEC. 410. AUTHORIZATION OF APPROPRIATIONS.

‘‘(a) IN GENERAL.—There is authorized to be appropriated to

carry out this title $1,000,000, for each of fiscal years 2001 through

2003, of which $550,000 shall be available in each such fiscal

year to carry out section 409.

‘‘(b) BUDGET REVIEW.—No amount made available under this

section for any fiscal year may be obligated or expended by the

Council before the date on which the Council reviews and approves

the operating budget of the Council to carry out the responsibilities

of the Council for that fiscal year.’’.

TITLE VIII—MISCELLANEOUS

PROVISIONS

SEC. 801. LOAN APPLICATION PROCESSING.

(a) STUDY.—The Administrator of the Small Business Administration shall conduct a study to determine the average time that

the Administration requires to process an application for each type

of loan or loan guarantee made under the Small Business Act

(15 U.S.C. 631 et seq.).

(b) TRANSMITTAL.—Not later than 1 year after the date of

the enactment of this Act, the Administrator shall transmit to

Congress the results of the study conducted under subsection (a).

SEC. 802. APPLICATION OF OWNERSHIP REQUIREMENTS.

(a) SMALL BUSINESS ACT.—Section 7(a) of the Small Business

Act (15 U.S.C. 636(a)) is amended by adding at the end the following:

‘‘(30) OWNERSHIP REQUIREMENTS.—Ownership requirements to determine the eligibility of a small business concern

that applies for assistance under any credit program under

this Act shall be determined without regard to any ownership

interest of a spouse arising solely from the application of the

community property laws of a State for purposes of determining

marital interests.’’.

(b) SMALL BUSINESS INVESTMENT ACT OF 1958.—Section 502

of the Small Business Investment Act of 1958 (15 U.S.C. 696)

is amended by adding at the end the following:

‘‘(6) OWNERSHIP REQUIREMENTS.—Ownership requirements

to determine the eligibility of a small business concern that

applies for assistance under any credit program under this

title shall be determined without regard to any ownership

interest of a spouse arising solely from the application of the

community property laws of a State for purposes of determining

marital interests.’’.

SEC. 803. SUBCONTRACTING PREFERENCE FOR VETERANS.

Section 8(d) of the Small Business Act (15 U.S.C. 637(d)) is

amended—

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–703

(1) in paragraph (1), by inserting ‘‘small business concerns

owned and controlled by veterans,’’ after ‘‘small business concerns,’’ the first place that term appears in each of the first

and second sentences;

(2) in paragraph (3)—

(A) in subparagraph (A), by inserting ‘‘small business

concerns owned and controlled by service-disabled veterans,’’ after ‘‘small business concerns owned and controlled

by veterans,’’ in each of the first and second sentences;

and

(B) in subparagraph (F), by inserting ‘‘small business

concern owned and controlled by service-disabled veterans,’’

after ‘‘small business concern owned and controlled by veterans,’’; and

(3) in each of paragraphs (4)(D), (4)(E), (6)(A), (6)(C), (6)(F),

and (10)(B), by inserting ‘‘small business concerns owned and

controlled by service-disabled veterans,’’ after ‘‘small business

concerns owned and controlled by veterans,’’.

SEC. 804. SMALL BUSINESS DEVELOPMENT CENTER PROGRAM FUNDING.

(a) AUTHORIZATION.—

(1) IN GENERAL.—Section 20(a)(1) of the Small Business

Act (15 U.S.C. 631 note) is amended by striking ‘‘For fiscal

year 1985’’ and all that follows through ‘‘expended.’’ and inserting the following: ‘‘For fiscal year 2000 and each fiscal year

thereafter, there are authorized to be appropriated such sums

as may be necessary and appropriate, to remain available until

expended, and to be available solely—

‘‘(A) to carry out the Small Business Development Center

Program under section 21, but not to exceed the annual funding

level, as specified in section 21(a);

‘‘(B) to pay the expenses of the National Small Business

Development Center Advisory Board, as provided in section

21(i);‘‘(C) to pay the expenses of the information sharing system,

as provided in section 21(c)(8);

‘‘(D) to pay the expenses of the association referred to

in section 21(a)(3)(A) for conducting the certification program,

as provided in section 21(k)(2); and

‘‘(E) to pay the expenses of the Administration, including

salaries of examiners, for conducting examinations as part of

the certification program conducted by the association referred

to in section 21(a)(3)(A).’’.

(2) TECHNICAL AMENDMENT.—Section 20(a) of the Small

Business Act (15 U.S.C. 631 note) is amended by moving the

margins of paragraphs (3) and (4), including subparagraphs

(A) and (B) of paragraph (4), 2 ems to the left.

(b) FUNDING FORMULA.—Section 21(a)(4)(C) of the Small Business Act (15 U.S.C. 648(a)(4)(C)) is amended to read as follows:

‘‘(C) FUNDING FORMULA.— ‘‘(i) IN GENERAL.—Subject to clause (iii), the amount

of a formula grant received by a State under this subparagraph shall be equal to an amount determined in accordance with the following formula:

‘‘(I) The annual amount made available under section 20(a) for the Small Business Development Center

114 STAT. 2763A–704 PUBLIC LAW 106–554—APPENDIX I

Program, less any reductions made for expenses

authorized by clause (v) of this subparagraph, shall

be divided on a pro rata basis, based on the percentage

of the population of each State, as compared to the

population of the United States.

‘‘(II) If the pro rata amount calculated under subclause (I) for any State is less than the minimum

funding level under clause (iii), the Administration

shall determine the aggregate amount necessary to

achieve that minimum funding level for each such

State.

‘‘(III) The aggregate amount calculated under subclause (II) shall be deducted from the amount calculated under subclause (I) for States eligible to receive

more than the minimum funding level. The deductions

shall be made on a pro rata basis, based on the population of each such State, as compared to the total

population of all such States.

‘‘(IV) The aggregate amount deducted under subclause (III) shall be added to the grants of those States

that are not eligible to receive more than the minimum

funding level in order to achieve the minimum funding

level for each such State, except that the eligible

amount of a grant to any State shall not be reduced

to an amount below the minimum funding level.

‘‘(ii) GRANT DETERMINATION.—The amount of a grant

that a State is eligible to apply for under this subparagraph

shall be the amount determined under clause (i), subject

to any modifications required under clause (iii), and shall

be based on the amount available for the fiscal year in

which performance of the grant commences, but not including amounts distributed in accordance with clause (iv).

The amount of a grant received by a State under any

provision of this subparagraph shall not exceed the amount

of matching funds from sources other than the Federal

Government, as required under subparagraph (A).

‘‘(iii) MINIMUM FUNDING LEVEL.—The amount of the

minimum funding level for each State shall be determined

for each fiscal year based on the amount made available

for that fiscal year to carry out this section, as follows:

‘‘(I) If the amount made available is not less than

$81,500,000 and not more than $90,000,000, the minimum funding level shall be $500,000.

‘‘(II) If the amount made available is less than

$81,500,000, the minimum funding level shall be the

remainder of $500,000 minus a percentage of $500,000

equal to the percentage amount by which the amount

made available is less than $81,500,000.

‘‘(III) If the amount made available is more than

$90,000,000, the minimum funding level shall be the

sum of $500,000 plus a percentage of $500,000 equal

to the percentage amount by which the amount made

available exceeds $90,000,000.

‘‘(iv) DISTRIBUTIONS.—Subject to clause (iii), if any

State does not apply for, or use, its full funding eligibility

for a fiscal year, the Administration shall distribute the

remaining funds as follows:

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–705

‘‘(I) If the grant to any State is less than the

amount received by that State in fiscal year 2000,

the Administration shall distribute such remaining

funds, on a pro rata basis, based on the percentage

of shortage of each such State, as compared to the

total amount of such remaining funds available, to

the extent necessary in order to increase the amount

of the grant to the amount received by that State

in fiscal year 2000, or until such funds are exhausted,

whichever first occurs.

‘‘(II) If any funds remain after the application of

subclause (I), the remaining amount may be distributed

as supplemental grants to any State, as the Administration determines, in its discretion, to be appropriate,

after consultation with the association referred to in

subsection (a)(3)(A).

‘‘(v) USE OF AMOUNTS.—

‘‘(I) IN GENERAL.—Of the amounts made available

in any fiscal year to carry out this section—

‘‘(aa) not more than $500,000 may be used

by the Administration to pay expenses enumerated

in subparagraphs (B) through (D) of section

20(a)(1); and

‘‘(bb) not more than $500,000 may be used

by the Administration to pay the examination

expenses enumerated in section 20(a)(1)(E).

‘‘(II) LIMITATION.—No funds described in subclause

(I) may be used for examination expenses under section

20(a)(1)(E) if the usage would reduce the amount of

grants made available under clause (i)(I) of this

subparagraph to less than $85,000,000 (after excluding

any amounts provided in appropriations Acts for specific institutions or for purposes other than the general

small business development center program) or would

further reduce the amount of such grants below such

amount.

‘‘(vi) EXCLUSIONS.—Grants provided to a State by the

Administration or another Federal agency to carry out

subsection (a)(6) or (c)(3)(G), or for supplemental grants

set forth in clause (iv)(II) of this subparagraph, shall not

be included in the calculation of maximum funding for

a State under clause (ii) of this subparagraph.

‘‘(vii) AUTHORIZATION OF APPROPRIATIONS.—There is

authorized to be appropriated to carry out this subparagraph $125,000,000 for each of fiscal years 2001, 2002,

and 2003.

‘‘(viii) STATE DEFINED.—In this subparagraph, the term

‘State’ means each of the several States, the District of

Columbia, the Commonwealth of Puerto Rico, the Virgin

Islands, Guam, and American Samoa.’’.

SEC. 805. SURETY BONDS.

(a) CONTRACT AMOUNTS.—Section 411 of the Small Business

Investment Act of 1958 (15 U.S.C. 694b) is amended—

(1) in subsection (a)(1), by striking ‘‘$1,250,000’’ and inserting ‘‘$2,000,000’’; and

114 STAT. 2763A–706 PUBLIC LAW 106–554—APPENDIX I

(2) in subsection (e)(2), by striking ‘‘$1,250,000’’ and inserting ‘‘$2,000,000’’.

(b) EXTENSION OF CERTAIN AUTHORITY.—Section 207 of the

Small Business Administration Reauthorization and Amendment

Act of 1988 (15 U.S.C. 694b note) is amended by striking ‘‘2000’’

and inserting ‘‘2003’’.

SEC. 806. SIZE STANDARDS.

(a) INDUSTRY CLASSIFICATIONS.—Section 15(a) of the Small

Business Act (15 U.S.C. 644(a)) is amended in the eighth sentence,

by striking ‘‘four-digit standard’’ and all that follows through ‘‘published’’ and inserting ‘‘definition of a ‘United States industry’ under

the North American Industry Classification System, as established’’.

(b) ANNUAL RECEIPTS.—Section 3(a)(1) of the Small Business

Act (15 U.S.C. 632(a)(1)) is amended by striking ‘‘$500,000’’ and

inserting ‘‘$750,000’’.

SEC. 807. NATIVE HAWAIIAN ORGANIZATIONS UNDER SECTION 8(a).

Section 8(a)(15)(A) of the Small Business Act (15 U.S.C.

637(a)(15)(A)) is amended to read as follows:

‘‘(A) is a nonprofit corporation that has filed articles of

incorporation with the director (or the designee thereof) of

the Hawaii Department of Commerce and Consumer Affairs,

or any successor agency,’’.

SEC. 808. NATIONAL VETERANS BUSINESS DEVELOPMENT CORPORATION CORRECTION.

Section 33(k) of the Small Business Act (15 U.S.C. 657c(k))

is amended—

(1) by striking paragraph (1) and inserting the following:

‘‘(1) IN GENERAL.—Subject to paragraph (2), there are

authorized to be appropriated to the Corporation to carry out

this section—

‘‘(A) $4,000,000 for fiscal year 2001;

‘‘(B) $4,000,000 for fiscal year 2002;

‘‘(C) $2,000,000 for fiscal year 2003; and

‘‘(D) $2,000,000 for fiscal year 2004.’’;

(2) in paragraph (2)(A), by striking ‘‘2001’’ each place it

appears and inserting ‘‘2002’’; and

(3) in paragraph (2)(B), by striking ‘‘2002 or 2003’’ and

inserting ‘‘2003 or 2004’’.

SEC. 809. PRIVATE SECTOR RESOURCES FOR SCORE.

Section 8(b)(1)(B) of the Small Business Act (15 U.S.C.

637(b)(1)(B)) is amended by adding at the end the following: ‘‘Notwithstanding any other provision of law, SCORE may solicit cash

and in-kind contributions from the private sector to be used to

carry out its functions under this Act, and may use payments

made by the Administration pursuant to this subparagraph for

such solicitation.’’.

SEC. 810. CONTRACT DATA COLLECTION.

Section 15 of the Small Business Act (15 U.S.C. 644) is amended

by adding at the end the following new subsection:

‘‘(p) DATABASE, ANALYSIS, AND ANNUAL REPORT WITH RESPECT

TO BUNDLED CONTRACTS.—

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–707

‘‘(1) BUNDLED CONTRACT DEFINED.—In this subsection, the

term ‘bundled contract’ has the meaning given such term in

section 3(o)(1). ‘‘(2) DATABASE.— ‘‘(A) IN GENERAL.—Not later than 180 days after the

date of the enactment of this subsection, the Administrator

of the Small Business Administration shall develop and

shall thereafter maintain a database containing data and

information regarding— ‘‘(i) each bundled contract awarded by a Federal

agency; and ‘‘(ii) each small business concern that has been

displaced as a prime contractor as a result of the

award of such a contract. ‘‘(3) ANALYSIS.—For each bundled contract that is to be

recompeted as a bundled contract, the Administrator shall

determine—

‘‘(A) the amount of savings and benefits (in accordance

with subsection (e)) achieved under the bundling of contract

requirements; and ‘‘(B) whether such savings and benefits will continue

to be realized if the contract remains bundled, and whether

such savings and benefits would be greater if the procurement requirements were divided into separate solicitations

suitable for award to small business concerns.

‘‘(4) ANNUAL REPORT ON CONTRACT BUNDLING.—

‘‘(A) IN GENERAL.—Not later than 1 year after the

date of the enactment of this paragraph, and annually

in March thereafter, the Administration shall transmit a

report on contract bundling to the Committees on Small

Business of the House of Representatives and the Senate.

‘‘(B) CONTENTS.—Each report transmitted under

subparagraph (A) shall include—

‘‘(i) data on the number, arranged by industrial

classification, of small business concerns displaced as

prime contractors as a result of the award of bundled

contracts by Federal agencies; and

‘‘(ii) a description of the activities with respect

to previously bundled contracts of each Federal agency

during the preceding year, including—

‘‘(I) data on the number and total dollar

amount of all contract requirements that were bundled; and

‘‘(II) with respect to each bundled contract,

data or information on—

‘‘(aa) the justification for the bundling of

contract requirements;

‘‘(bb) the cost savings realized by bundling

the contract requirements over the life of the

contract;

‘‘(cc) the extent to which maintaining the

bundled status of contract requirements is projected to result in continued cost savings;

‘‘(dd) the extent to which the bundling

of contract requirements complied with the

contracting agency’s small business subcontracting plan, including the total dollar

114 STAT. 2763A–708 PUBLIC LAW 106–554—APPENDIX I

value awarded to small business concerns as

subcontractors and the total dollar value previously awarded to small business concerns

as prime contractors; and

‘‘(ee) the impact of the bundling of contract

requirements on small business concerns

unable to compete as prime contractors for

the consolidated requirements and on the

industries of such small business concerns,

including a description of any changes to the

proportion of any such industry that is composed of small business concerns.

‘‘(5) ACCESS TO DATA.—

‘‘(A) FEDERAL PROCUREMENT DATA SYSTEM.—To assist

in the implementation of this section, the Administration

shall have access to information collected through the Federal Procurement Data System.

‘‘(B) AGENCY PROCUREMENT DATA SOURCES.—To assist

in the implementation of this section, the head of each

contracting agency shall provide, upon request of the

Administration, procurement information collected through

existing agency data collection sources.’’.

SEC. 811. PROCUREMENT PROGRAM FOR WOMEN-OWNED SMALL BUSINESS CONCERNS.

Section 8 of the Small Business Act (15 U.S.C. 637) is amended

by adding at the end the following:

‘‘(m) PROCUREMENT PROGRAM FOR WOMEN-OWNED SMALL BUSINESS CONCERNS.—

‘‘(1) DEFINITIONS.—In this subsection, the following definitions apply:

‘‘(A) CONTRACTING OFFICER.—The term ‘contracting

officer’ has the meaning given such term in section 27(f )(5)

of the Office of Federal Procurement Policy Act (41 U.S.C.

423(f )(5)).

‘‘(B) SMALL BUSINESS CONCERN OWNED AND CONTROLLED BY WOMEN.—The term ‘small business concern

owned and controlled by women’ has the meaning given

such term in section 3(n), except that ownership shall

be determined without regard to any community property

law.

‘‘(2) AUTHORITY TO RESTRICT COMPETITION.—In accordance

with this subsection, a contracting officer may restrict competition for any contract for the procurement of goods or services

by the Federal Government to small business concerns owned

and controlled by women, if—

‘‘(A) each of the concerns is not less than 51 percent

owned by one or more women who are economically disadvantaged (and such ownership is determined without

regard to any community property law);

‘‘(B) the contracting officer has a reasonable expectation that two or more small business concerns owned and

controlled by women will submit offers for the contract;

‘‘(C) the contract is for the procurement of goods or

services with respect to an industry identified by the

Administrator pursuant to paragraph (3);

PUBLIC LAW 106–554—APPENDIX I 114 STAT. 2763A–709

‘‘(D) the anticipated award price of the contract (including options) does not exceed—

‘‘(i) $5,000,000, in the case of a contract assigned

an industrial classification code for manufacturing; or

‘‘(ii) $3,000,000, in the case of all other contracts;

‘‘(E) in the estimation of the contracting officer, the

contract award can be made at a fair and reasonable price;

and

‘‘(F) each of the concerns—

‘‘(i) is certified by a Federal agency, a State government, or a national certifying entity approved by the

Administrator, as a small business concern owned and

controlled by women; or

‘‘(ii) certifies to the contracting officer that it is

a small business concern owned and controlled by

women and provides adequate documentation, in

accordance with standards established by the Administration, to support such certification.

‘‘(3) WAIVER.—With respect to a small business concern

owned and controlled by women, the Administrator may waive

subparagraph (2)(A) if the Administrator determines that the

concern is in an industry in which small business concerns

owned and controlled by women are substantially underrepresented.

‘‘(4) IDENTIFICATION OF INDUSTRIES.—The Administrator

shall conduct a study to identify industries in which small

business concerns owned and controlled by women are underrepresented with respect to Federal procurement contracting.

‘‘(5) ENFORCEMENT; PENALTIES.—

‘‘(A) VERIFICATION OF ELIGIBILITY.—In carrying out this

subsection, the Administrator shall establish procedures

relating to—

‘‘(i) the filing, investigation, and disposition by the

Administration of any challenge to the eligibility of

a small business concern to receive assistance under

this subsection (including a challenge, filed by an

interested party, relating to the veracity of a certification made or information provided to the Administration by a small business concern under paragraph

(2)(F)); and

‘‘(ii) verification by the Administrator of the

accuracy of any certification made or information provided to the Administration by a small business concern under paragraph (2)(F).

‘‘(B) EXAMINATIONS.—The procedures established under

subparagraph (A) may provide for program examinations

(including random program examinations) by the Administrator of any small business concern making a certification

or providing information to the Administrator under paragraph (2)(F).

‘‘(C) PENALTIES.—In addition to the penalties described

in section 16(d), any small business concern that is determined by the Administrator to have misrepresented the

status of that concern as a small business concern owned

and controlled by women for purposes of this subsection,

shall be subject to—

114 STAT. 2763A–710 PUBLIC LAW 106–554—APPENDIX I

‘‘(i) section 1001 of title 18, United States Code;

and ‘‘(ii) sections 3729 through 3733 of title 31, United

States Code.

‘‘(6) PROVISION OF DATA.—Upon the request of the Administrator, the head of any Federal department or agency shall

promptly provide to the Administrator such information as

the Administrator determines to be necessary to carry out

this subsection.’’.