II

105TH CONGRESS

2D SESSION S. 2178

To amend the National Housing Act to authorize the Secretary of Housing

and Urban Development to insure mortgages for the acquisition, construction, or substantial rehabilitation of child care and development

facilities and to establish the Children’s Development Commission to

certify such facilities for such insurance, and for other purposes.

IN THE SENATE OF THE UNITED STATES

JUNE 16, 1998

Mr. KOHL (for himself and Mr. D’AMATO) introduced the following bill; which

was read twice and referred to the Committee on Banking, Housing, and

Urban Affairs

A BILL

To amend the National Housing Act to authorize the Secretary of Housing and Urban Development to insure

mortgages for the acquisition, construction, or substantial rehabilitation of child care and development facilities

and to establish the Children’s Development Commission

to certify such facilities for such insurance, and for other

purposes.

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled,
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1 SECTION 1. SHORT TITLE.

2 This Act may be cited as the ‘‘Children’s Develop3 ment Commission Act’’.

4 SEC. 2. CONGRESSIONAL FINDINGS.

5 Congress finds the following:

6 (1) The need for quality nursery schools, both

7 full-time and part-time child care centers and after8 school programs, after school programs, neighbor9 hood-run mothers-day-out programs, and family

10 child care providers has grown among working par11 ents, and parents who stay at home, who want their

12 children to have access to early childhood education.

13 (2) All parents should have access to safe, stim14 ulating, and educational early childhood education

15 programs for their children, whether such programs

16 are carried out in a child care center, a part-time

17 nursery school (including a nursery school operated

18 by a religious organization), or a certified child care

19 provider’s home.

20 (3) The number of available enrollment oppor21 tunities for children to receive quality child care

22 services is not meeting the demand for such services.

23 (4) In 1995 there were about 21,000,000 chil24 dren less than 6 years of age, of whom 31 percent

25 were participating in center-based child care services

26 and 14 percent were receiving child care in homes.
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1 Between 1992 and 2005 the participation of women

2 24 to 54 years of age in the labor force is projected

3 to increase from 75 percent to 83 percent.

4 (5) In States that have set up a mechanism to

5 provide capital improvements for child care facilities,

6 the demand for services of such facilities still has

7 not been met.

8 (6) The United States is behind other western,

9 industrialized countries when it comes to providing

10 child care services. In France, almost 100 percent of

11 all children 3 to 5 years of age attend nursery

12 school. In Germany this number is 65 to 70 percent.

13 In Japan 90 percent of such children attend some

14 form of preschool care. In all of these countries early

15 childhood care has proven to increase children’s de16 velopment and performance.

17 SEC. 3. INSURANCE FOR MORTGAGES ON NEW AND REHA18 BILITATED CHILD CARE AND DEVELOPMENT

19 FACILITIES.

20 Title II of the National Housing Act (12 U.S.C. 1707

21 et seq.) is amended by adding at the end the following:

22 ‘‘MORTGAGE INSURANCE FOR CHILD CARE AND

23 DEVELOPMENT FACILITIES

24 ‘‘SEC. 257. (a) PURPOSE.—The purpose of this sec25 tion is to facilitate and assist in the provision and develop26 ment of licensed child care and development facilities.
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1 ‘‘(b) GENERAL INSURANCE AUTHORITY.—The Sec2 retary may insure mortgages (including advances on such

3 mortgages during construction) in accordance with the

4 provisions of this section and upon such terms and condi5 tions as the Secretary may prescribe and may make com6 mitments for insurance of such mortgages before the date

7 of their execution or disbursement thereon.

8 ‘‘(c) ELIGIBLE MORTGAGES.—To carry out the pur9 pose of this section, the Secretary may insure any mort10 gage that covers a new child care and development facility,

11 including a new addition to an existing child care and de12 velopment facility (regardless of whether the existing facil13 ity is being rehabilitated), or a substantially rehabilitated

14 child care and development facility, including equipment

15 to be used in the operation of the facility, subject to the

16 following conditions:

17 ‘‘(1) APPROVED MORTGAGOR.—The mortgage

18 shall be executed by a mortgagor approved by the

19 Secretary. The Secretary may, in the discretion of

20 the Secretary, require any such mortgagor to be reg21 ulated or restricted as to charges and methods of fi22 nancing and, if the mortgagor is a corporate entity,

23 as to capital structure and rate of return. As an aid

24 to the regulation or restriction of any mortgagor

25 with respect to any of the foregoing matters, the
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1 Secretary may make such contracts with and acquire

2 for not more than $100 such stock or interest in

3 such mortgagor as the Secretary may consider nec4 essary. Any stock or interest so purchased shall be

5 paid for out of the General Insurance Fund, and

6 shall be redeemed by the mortgagor at par upon the

7 termination of all obligations of the Secretary under

8 the insurance.

9 ‘‘(2) PRINCIPAL OBLIGATION.—The mortgage

10 shall involve a principal obligation in an amount not

11 to exceed 90 percent of the estimated value of the

12 property or project, or 95 percent of the estimated

13 value of the property or project in the case of a

14 mortgagor that is a private nonprofit corporation or

15 association (as such term is defined pursuant to sec16 tion 221(d)(3)), including—

17 ‘‘(A) equipment to be used in the operation

18 of the facility when the proposed improvements

19 are completed and the equipment is installed; or

20 ‘‘(B) a solar energy system (as defined in

21 subparagraph (3) of the last paragraph of sec22 tion 2(a)) or residential energy conservation

23 measures (as defined in subparagraphs (A)

24 through (G) and (I) of section 210(11) of the

25 National Energy Conservation Policy Act), in
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1 cases in which the Secretary determines that

2 such measures are in addition to those required

3 under the minimum property standards and will

4 be cost-effective over the life of the measure.

5 ‘‘(3) AMORTIZATION AND INTEREST.—The

6 mortgage shall—

7 ‘‘(A) provide for complete amortization by

8 periodic payments under such terms as the Sec9 retary shall prescribe;

10 ‘‘(B) have a maturity satisfactory to the

11 Secretary, but in no event longer than 25 years;

12 and

13 ‘‘(C) bear interest at such rate as may be

14 agreed upon by the mortgagor and the mortga15 gee, and the Secretary shall not issue any regu16 lations or establish any terms or conditions that

17 interfere with the ability of the mortgagor and

18 mortgagee to determine the interest rate.

19 ‘‘(d) CERTIFICATION BY CHILDREN’S DEVELOPMENT

20 COMMISSION.—The Secretary may not insure a mortgage

21 under this section unless the Children’s Development

22 Commission established under section 258 certifies that

23 the facility is in compliance, or will be in compliance not

24 later than 12 months after such certification, with—
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1 ‘‘(1) any laws, standards, and requirements ap2 plicable to such facilities under the laws of the

3 State, municipality, or other unit of general local

4 government in which the facility is or is to be lo5 cated; and

6 ‘‘(2) after the effective date of the standards

7 and requirements established under section

8 258(c)(2), such standards and requirements.

9 ‘‘(e) RELEASE.—The Secretary may consent to the

10 release of a part or parts of the mortgaged property or

11 project from the lien of any mortgage insured under this

12 section upon such terms and conditions as the Secretary

13 may prescribe.

14 ‘‘(f) MORTGAGE INSURANCE TERMS.—The provisions

15 of subsections (d), (e), (g), (h), (i), (j), (k), (l), and (n)

16 of section 207 shall apply to mortgages insured under this

17 section, except that all references in such subsections to

18 section 207 shall be considered, for purposes of mortgage

19 insurance under this section, to refer to this section.

20 ‘‘(g) MORTGAGE INSURANCE FOR FIRE SAFETY

21 EQUIPMENT LOANS.—

22 ‘‘(1) AUTHORITY.—The Secretary may, upon

23 such terms and condition as the Secretary may pre24 scribe, make commitments to insure and insure

25 loans made by financial institutions or other ap-
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1 proved mortgagees to child care and development fa2 cilities to provide for the purchase and installation

3 of fire safety equipment necessary for compliance

4 with the 1967 edition of the Life Safety Code of the

5 National Fire Protection Association (or any subse6 quent edition specified by the Secretary of Health

7 and Human Services).

8 ‘‘(2) LOAN REQUIREMENTS.—To be eligible for

9 insurance under this subsection a loan shall—

10 ‘‘(A) not exceed the Secretary’s estimate of

11 the reasonable cost of the equipment fully in12 stalled;

13 ‘‘(B) bear interest at such rate as may be

14 agreed upon by the mortgagor and the mortga15 gee;

16 ‘‘(C) have a maturity satisfactory to the

17 Secretary;

18 ‘‘(D) be made by a financial institution or

19 other mortgagee approved by the Secretary as

20 eligible for insurance under section 2 or a mort21 gagee approved under section 203(b)(1);

22 ‘‘(E) comply with other such terms, condi23 tions, and restrictions as the Secretary may

24 prescribe; and
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1 ‘‘(F) be made with respect to a child care

2 and development facility that complies with the

3 requirement under subsection (d).

4 ‘‘(3) INSURANCE REQUIREMENTS.—The provi5 sions of paragraphs (5), (6), (7), (9), and (10) of

6 section 220(h) shall apply to loans insured under

7 this subsection, except that all references in such

8 paragraphs to home improvement loans shall be con9 sidered, for purposes of this subsection, to refer to

10 loans under this subsection. The provisions of sub11 sections (c), (d), and (h) of section 2 shall apply to

12 loans insured under this subsection, except that all

13 references in such subsections to ‘this section’ or

14 ‘this title’ shall be considered, for purposes of this

15 subsection, to refer to this subsection.

16 ‘‘(h) SCHEDULES AND DEADLINES.—The Secretary

17 shall establish schedules and deadlines for the processing

18 and approval (or provision of notice of disapproval) of ap19 plications for mortgage insurance under this section.

20 ‘‘(i) DEFINITIONS.—For the purposes of this section,

21 the following definitions shall apply:

22 ‘‘(1) CHILD CARE AND DEVELOPMENT FACIL23 ITY.—The term ‘child care and development facility’

24 means a public facility, proprietary facility, or facil-
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1 ity of a private nonprofit corporation or association

2 that—

3 ‘‘(A) has as its purpose the care and devel4 opment of children less than 12 years of age;

5 and

6 ‘‘(B) is licensed or regulated by the State

7 in which it is located (or, if there is no State

8 law providing for such licensing and regulation

9 by the State, by the municipality or other politi10 cal subdivision in which the facility is located).

11 The term does not include facilities for school-age

12 children primarily for use during normal school

13 hours. The term includes facilities for training indi14 viduals to provide child care and development serv15 ices.

16 ‘‘(2) EQUIPMENT.—The term ‘equipment’ in17 cludes machinery, utilities, and built-in equipment

18 and any necessary enclosures or structures to house

19 them, and any other items necessary for the func20 tioning of a particular facility as a child care and

21 development facility, including necessary furniture.

22 Such term includes books, curricular, and program

23 materials.

24 ‘‘(3) MORTGAGE; FIRST MORTGAGE; MORTGA25 GEE.—The term ‘mortgage’ means a first mortgage
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1 on real estate in fee simple, or on the interest of ei2 ther the lessor or lessee thereof under a lease having

3 a period of not less than 7 years to run beyond the

4 maturity date of the mortgage. The term ‘first mort5 gage’ means such classes of first liens as are com6 monly given to secure advances (including advances

7 during construction) on, or the unpaid purchase

8 price of, real estate under the laws of the State in

9 which the real estate is located, together with the

10 credit instrument or instruments (if any) secured

11 thereby, and any mortgage may be in the form of

12 one or more trust mortgages or mortgage indentures

13 or deeds of trust, securing notes, bonds, or other

14 credit instruments, and, by the same instrument or

15 by a separate instrument, may create a security in16 terest in initial equipment, whether or not attached

17 to the realty. The term ‘mortgagor’ has the meaning

18 given the term in section 207(a).

19 ‘‘(j) LIMITATION ON INSURANCE AUTHORITY.—

20 ‘‘(1) TERMINATION.—No mortgage may be in21 sured under this section or section 223(h) after Sep22 tember 30, 2005, except pursuant to a commitment

23 to insure issued on or before such date.

24 ‘‘(2) AGGREGATE PRINCIPAL AMOUNT LIMITA25 TION.—The aggregate principal amount of mort-
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1 gages for which the Secretary enters into commit2 ments to insure under this section or section 223(h)

3 on or before the date under paragraph (1) may not

4 exceed $2,000,000,000. If, upon the date under

5 paragraph (1), the aggregate insurance authority

6 provided under this paragraph has not been fully

7 used, the Secretary of the Treasury shall submit a

8 report to Congress evaluating the need for continued

9 mortgage insurance under this section.’’.

10 ‘‘(k) REGULATIONS.—The Secretary shall issue any

11 regulations necessary to carry out this section. In issuing

12 such regulations, the Secretary shall consult with the Sec13 retary of Health and Human Services with respect to any

14 aspects of the regulations regarding child care and devel15 opment facilities.’’.

16 SEC. 4. INSURANCE FOR MORTGAGES FOR ACQUISITION OR

17 REFINANCING DEBT OF EXISTING CHILD

18 CARE AND DEVELOPMENT FACILITIES.

19 Section 223 of the National Housing Act (12 U.S.C.

20 1715n) is amended by adding at the end the following:

21 ‘‘(h) MORTGAGE INSURANCE FOR PURCHASE OR RE22 FINANCING OF EXISTING CHILD CARE AND DEVELOP23 MENT FACILITIES.—

24 ‘‘(1) AUTHORITY.—Notwithstanding any other

25 provision of this Act, the Secretary may insure
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1 under any section of this title a mortgage executed

2 in connection with the purchase or refinancing of an

3 existing child care and development facility, the pur4 chase of a structure to serve as a child care and de5 velopment facility, or the refinancing of existing debt

6 of an existing child care and development facility.

7 ‘‘(2) PURCHASE OF EXISTING FACILITIES AND

8 STRUCTURES.—In the case of the purchase under

9 this subsection of an existing child care and develop10 ment facility or purchase of an existing structure to

11 serve as such a facility, the Secretary shall prescribe

12 any terms and conditions that the Secretary consid13 ers necessary to ensure that—

14 ‘‘(A) the facility or structure purchased

15 continues to be used as a child care and devel16 opment facility; and

17 ‘‘(B) the facility complies with the same

18 requirements applicable under subsections (d)

19 and (e) of section 257 to facilities having mort20 gages insured under such section.

21 ‘‘(3) REFINANCING OF EXISTING FACILITIES.—

22 In the case of refinancing of an existing child care

23 and development facility, the Secretary shall pre24 scribe any terms and conditions that the Secretary

25 considers necessary to ensure that—
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1 ‘‘(A) the refinancing is used to lower the

2 monthly debt service costs (taking into account

3 any fees or charges connected with such refi4 nancing) of the existing facility;

5 ‘‘(B) the proceeds of any refinancing will

6 be employed only to retire the existing indebted7 ness and pay the necessary cost of refinancing

8 on the existing facility;

9 ‘‘(C) the existing facility is economically

10 viable; and

11 ‘‘(D) the facility complies with the same

12 requirements applicable under section 257(d) to

13 facilities having mortgages insured under such

14 section.

15 ‘‘(4) DEFINITIONS.—For purposes of this sub16 section, the terms defined in section 257(i) shall

17 have the same meanings as provided under such sec18 tion.

19 ‘‘(5) LIMITATION ON INSURANCE AUTHORITY.—

20 The authority of the Secretary to enter into commit21 ments to insure mortgages under this subsection is

22 subject to the limitations under section 257(j).’’.
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1 SEC. 5. CHILDREN’S DEVELOPMENT COMMISSION.

2 Title II of the National Housing Act (12 U.S.C. 1707

3 et seq.) is amended by adding at the end (after section

4 257, as added by section 3 of this Act) the following:

5 ‘‘CHILDREN’S DEVELOPMENT COMMISSION

6 ‘‘SEC. 258. (a) ESTABLISHMENT.—There is hereby

7 established a commission to be known as the Children’s

8 Development Commission.

9 ‘‘(b) MEMBERSHIP.—

10 ‘‘(1) APPOINTMENT.—The Commission shall be

11 composed of 7 members appointed by the President,

12 not later than the expiration of the 3-month period

13 beginning upon the enactment of this section, by and

14 with the advice and consent of the Senate, as fol15 lows:

16 ‘‘(A) 1 member shall be appointed from

17 among 3 individuals recommended by the Sec18 retary of Housing and Urban Development or

19 the Secretary’s designee.

20 ‘‘(B) 1 member shall be appointed from

21 among 3 individuals recommended by the Sec22 retary of Health and Human Services or the

23 Secretary’s designee.

24 ‘‘(C) 1 member shall be appointed from

25 among 3 individuals recommended by the Sec-
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1 retary of the Treasury or the Secretary’s des2 ignee.

3 ‘‘(D) 4 members shall be appointed from

4 among 12 individuals recommended jointly by

5 the Speaker of the House of Representatives,

6 the Majority Leader of the Senate, Minority

7 Leader of the House of Representatives, the

8 Minority Leader of the Senate.

9 ‘‘(2) QUALIFICATIONS OF CONGRESSIONALLY

10 RECOMMENDED MEMBERS.—Of the members ap11 pointed under paragraph (1)(D)—

12 ‘‘(A) each shall be an individual who ac13 tively participates or is employed in the field of

14 child care and has academic, licensing, or other

15 credentials relating to such participation or em16 ployment; and

17 ‘‘(B) not more than 2 may be of the same

18 political party.

19 ‘‘(3) TERMS.—Each appointed member of the

20 Commission shall serve for a term of 3 years.

21 ‘‘(4) VACANCIES.—Any member appointed to

22 fill a vacancy occurring before the expiration of the

23 term for which the member’s predecessor was ap24 pointed shall be appointed only for the remainder of

25 that term. A member may serve after the expiration
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1 of that member’s term until a successor has taken

2 office. A vacancy in the Commission shall be filled

3 in the manner in which the original appointment was

4 made.

5 ‘‘(5) CHAIRPERSON.—The chairperson of the

6 Commission shall be designated by the President at

7 the time of appointment.

8 ‘‘(6) QUORUM.—A majority of the members of

9 the Commission shall constitute a quorum for the

10 transaction of business.

11 ‘‘(7) VOTING.—Each member of the Commis12 sion shall be entitled to 1 vote, which shall be equal

13 to the vote of every other member of the Commis14 sion.

15 ‘‘(8) PROHIBITION ON ADDITIONAL PAY.—

16 Members of the Commission shall serve without

17 compensation, but shall be reimbursed for travel,

18 subsistence, and other necessary expenses incurred

19 in the performance of their duties as members of the

20 Commission.

21 ‘‘(c) FUNCTIONS.—The Commission shall carry out

22 the following functions:

23 ‘‘(1) CERTIFICATION OF COMPLIANCE.—The

24 Commission shall collect such information and make

25 such determinations as may be necessary to deter-
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1 mine, for purposes of section 257(d), whether child

2 care and development facilities comply, or will be in

3 compliance within 12 months, with—

4 ‘‘(A) any laws, standards, and require5 ments applicable to such facilities under the

6 laws of the State, municipality, or other unit of

7 general local government in which the facility is

8 or is to be located, and

9 ‘‘(B) after the effective date of the stand10 ards and requirements established under para11 graph (2), such standards and requirements,

12 and shall issue certifications of such compliance.

13 ‘‘(2) ESTABLISHMENT OF STANDARDS.—

14 ‘‘(A) STUDY.—Not later than 12 months

15 after the date on which appointment of initial

16 membership of the Commission is completed,

17 the Commission, in consultation with the Sec18 retary of Housing and Urban Development and

19 the Secretary of Health and Human Services,

20 shall conduct a study to determine the laws,

21 standards, and requirements referred to in

22 paragraph (1)(A) that are applicable in each

23 State. Taking into consideration the findings of

24 the study, the Secretary shall establish stand25 ards and requirements regarding child care and
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1 development facilities that are designed to en2 sure that mortgage insurance is provided under

3 section 257 and section 223(h) only for safe,

4 clean, and healthy facilities that provide appro5 priate care and development services for chil6 dren.

7 ‘‘(B) PUBLICATION.—The Commission

8 shall issue regulations providing for the stand9 ards and requirements established under sub10 paragraph (A) to take effect, for purposes of

11 sections 257(d)(2) and 223(h)(2)(B) and para12 graph (1)(B) of this section, not later than 18

13 months after the date of enactment of this sec14 tion.

15 ‘‘(3) SMALL PURPOSE LOANS.—The Commis16 sion shall, to the extent amounts are made available

17 for such purpose pursuant to subsection (i) and

18 qualified requests are received, make loans, directly

19 or indirectly to providers of child care and develop20 ment facilities for reconstruction or renovation of

21 such facilities, subject to the following requirements:

22 ‘‘(A) Loans under this paragraph shall be

23 made only for such facilities that are financially

24 and operationally viable, as determined under
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1 standards and guidelines to be established by

2 the Commission.

3 ‘‘(B) The aggregate amount of loans made

4 under this paragraph to a single borrower may

5 not exceed $50,000.

6 ‘‘(C) A loan made under this paragraph

7 may not have a term to maturity exceeding 7

8 years.

9 ‘‘(D) Loans under this paragraph shall

10 bear interest at rates and be made under such

11 other conditions and terms as the Commission

12 shall provide.

13 ‘‘(4) NOTIFICATION.—The Commission shall

14 take such actions as may be necessary to publicize

15 the availability of the programs for mortgage insur16 ance under sections 257 and 223(h) and loans under

17 paragraph (3) of this subsection in a manner that

18 ensures that information concerning such programs

19 will be available to child care providers throughout

20 the United States.

21 ‘‘(5) LIABILITY INSURANCE.—Not later than 12

22 months after the date on which appointment of ini23 tial membership of the Commission is completed, the

24 Commission shall establish standards and guidelines,

25 applicable to mortgage insurance under sections 257
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1 and 223(h) and loans under paragraph (3) of this

2 subsection, requiring child care providers operating

3 child care and development facilities assisted under

4 such provisions to obtain and maintain liability in5 surance in such amounts and subject to such re6 quirements as the Commission considers appro7 priate.

8 ‘‘(6) RESEARCH FOUNDATION.—Not later than

9 12 months after the date of enactment of this sec10 tion, the Commission shall submit a report to Con11 gress recommending a plan for establishing and

12 funding a foundation that is an entity independent

13 of the Commission (but which maintains association

14 with the Commission), the purpose of which shall

15 be—

16 ‘‘(A) to support research relating to child

17 care and development facilities;

18 ‘‘(B) to fund pilot programs to test innova19 tive methods for improving child care; and

20 ‘‘(C) to engage in activities and publish

21 materials to assist persons interested in mort22 gage insurance under sections 257 and 223(h)

23 and other assistance provided by the Commis24 sion.

25 ‘‘(d) NONDISCRIMINATION REQUIREMENT.—
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1 ‘‘(1) IN GENERAL.—The Commission may not

2 certify under subsection (c)(1) or carry out any ac3 tivities of the Commission with respect to any child

4 care and development facility if the provider of the

5 facility discriminates on account of race, color, reli6 gion (subject to paragraph (2)), national origin, sex

7 (to the extent provided in title IX of the Education

8 Amendments of 1972 (20 U.S.C. 1681 et seq.)), or

9 handicapping condition.

10 ‘‘(2) FACILITIES OF RELIGIOUS ORGANIZA11 TIONS.—The prohibition with respect to religion

12 shall not apply to a child care and development facil13 ity which is controlled by or which is closely identi14 fied with the tenets of a particular religious organi15 zation if the application of this subsection would not

16 be consistent with the religious tenets of such orga17 nization.

18 ‘‘(3) CERTIFICATION.—As a condition of certifi19 cation under subsection (c)(1) and eligibility for a

20 loan under subsection (c)(3), the provider of a child

21 care and development facility shall certify to the

22 Commission that the provider does not discriminate,

23 as required by the provisions of paragraph (1) of

24 this subsection.

25 ‘‘(e) POWERS.—
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1 ‘‘(1) ASSISTANCE FROM FEDERAL AGENCIES.—

2 The Commission may secure directly from any de3 partment or agency of the Federal Government such

4 information as the Commission may require for car5 rying out its functions. Upon request of the Com6 mission, any such department or agency shall fur7 nish such information.

8 ‘‘(2) ASSISTANCE FROM GENERAL SERVICES

9 ADMINISTRATION.—The Administrator of General

10 Services shall provide to the Commission, on a reim11 bursable basis, such administrative support services

12 as the Commission may request.

13 ‘‘(3) ASSISTANCE FROM DEPARTMENT OF

14 HOUSING AND URBAN DEVELOPMENT.—Upon the re15 quest of the Commission, the Secretary of Housing

16 and Urban Development shall, to the extent possible

17 and subject to the discretion of the Secretary, detail

18 any of the personnel of the Department of Housing

19 and Urban Development, on a nonreimbursable

20 basis, to assist the Commission in carrying out its

21 functions under this section.

22 ‘‘(4) MAILS.—The Commission may use the

23 United States mails in the same manner and under

24 the same conditions as other Federal agencies.

25 ‘‘(f) STAFF.—
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1 ‘‘(1) EXECUTIVE DIRECTOR.—The Commission

2 shall appoint an executive director of the Board, who

3 shall be compensated at a rate fixed by the Commis4 sion, but which shall not exceed the rate established

5 for level I of the Executive Schedule under title 5,

6 United States Code.

7 ‘‘(2) OTHER PERSONNEL.—In addition to the

8 executive director, the Commission may appoint and

9 fix the compensation of such personnel as the Com10 mission considers necessary, in accordance with the

11 provisions of title 5, United States Code, governing

12 appointments to the competitive service, and the

13 provisions of chapter 51 and subchapter III of chap14 ter 53 of such title, relating to classification and

15 General Schedule pay rates.

16 ‘‘(g) REPORTS.—Not later than March 31 of each

17 year, the Commission shall submit a report to the Presi18 dent and Congress regarding the operations and activities

19 of the Commission during the preceding calendar year.

20 Each annual report shall include a copy of the Commis21 sion’s financial statements and such information and other

22 evidence as is necessary to demonstrate that the activities

23 of the Commission during the year for which the report

24 is made. The Commission may also submit reports to Con-
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1 gress and the President at such other times as the Com2 mission deems desirable.

3 ‘‘(h) DEFINITIONS.—For purposes of this section, the

4 terms defined in section 257(i) shall have the same mean5 ings as provided under such section.

6 ‘‘(i) AUTHORIZATION OF APPROPRIATIONS.—There

7 are authorized to be appropriated to the Commission to

8 carry out this section $10,000,000 for fiscal year 1999,

9 to remain available until expended, of which not more than

10 $2,500,000 shall be available for administrative costs of

11 the Commission and the remainder of which shall be avail12 able only for loans under subsection (c)(3).’’.

13 SEC. 6. STUDY OF AVAILABILITY OF SECONDARY MARKETS

14 FOR MORTGAGES ON CHILD CARE FACILI15 TIES.

16 (a) STUDY.—The Secretary of the Treasury shall

17 conduct a study of the secondary mortgage markets to de18 termine—

19 (1) whether such a market exists for purchase

20 of mortgages eligible for insurance under sections

21 223(h) and 257 of the National Housing Act (as

22 added by this Act);

23 (2) whether such a market would affect the

24 availability of credit available for development of
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1 child care and development facilities or would lower

2 development costs of such facilities; and

3 (3) the extent to which such a market or other

4 activities to provide credit enhancement for child

5 care and development facilities loans is needed to

6 meet the demand for such facilities.

7 (b) REPORT.—The Secretary of the Treasury shall

8 submit to Congress a report regarding the results of the

9 study conducted under this section not later than the expi10 ration of the 2-year period beginning on the date of enact11 ment of this Act.

Æ