Pay for Performance Act

To encourage and support partnerships between the public and private sectors to improve our nation’s social programs, and for other purposes. 1. Short title This Act may be cited as the Pay for Performance Act 2. Social Impact Pay for Performance Contracts Title XX of the Social Security Act ( 42 U.S.C. 1397 (1) in the title heading, by striking to States and Projects (2) by adding at the end the following: C Social Impact Pay for Performance Contracts 2051. Purposes The purposes of this subtitle are the following: (1) To improve the lives of families and individuals in need in the United States by funding social programs that achieve real results. (2) To redirect funds away from programs that, based on objective data, are ineffective, and into programs that achieve demonstrable, measurable results. (3) To ensure Federal funds are used effectively on social services to produce positive outcomes for both service recipients and taxpayers. (4) To establish the use of social impact pay for performance contracts to address some of our Nation’s most pressing problems. (5) To facilitate the creation of public-private partnerships that bundle philanthropic and other private resources with existing public spending to scale up effective social interventions already being implemented by private organizations, non-profits, charitable organizations, and local governments across the country. (6) To bring pay-for-performance to the social services sector, allowing the United States to improve the impact and effectiveness of vital social services programs while redirecting inefficient or duplicative spending. 2052. Social impact pay for performance contract application (a) Notice Not later than 1 year after the date of the enactment of this subtitle, the Secretary of the Treasury (referred to in this subtitle as the Secretary (b) Required outcomes for social impact pay for performance contract project To qualify as a social impact pay for performance contract project under this subtitle, a project must produce a measurable, clearly defined outcome that results in social benefit and Federal savings through any of the following: (1) Increasing work and earnings by individuals who have been unemployed in the United States for more than 6 consecutive months. (2) Increasing employment and earnings of individuals age 16 to 24. (3) Increasing employment among individuals receiving Federal disability benefits. (4) Reducing the dependence of low-income families on Federal means-tested benefits. (5) Improving rates of high school graduation. (6) Reducing teen and unplanned pregnancies. (7) Improving birth outcomes among low-income families and individuals. (8) Reducing rates of asthma, diabetes, or other preventable diseases among low-income families and individuals. (9) Increasing the proportion of children living in 2-parent families. (10) Reducing incidences of child abuse and neglect. (11) Reducing the number of youth in foster care who are emancipated from care by increasing adoptions, permanent guardianship arrangements, reunification, or placement with a fit and willing relative for children and youth in foster care. (12) Reducing the number of children and youth in foster care residing in group homes, child care institutions, agency-operated foster homes, or other non-family foster homes, unless it is determined that it is in the interest of the child's long-term health, safety, or psychological well-being to not be placed in a family foster home. (13) Reducing recidivism among individuals released from prison. (14) Other measurable outcomes defined by the State or local government that result in positive social outcomes and Federal savings. (c) Feasibility study required The notice described in subsection (a) shall require a State or local government to submit a feasibility study for the social impact pay for performance contract project that contains the following information: (1) The outcome goals of the project. (2) A description of each intervention in the project and anticipated outcome of such intervention. (3) Rigorous evidence demonstrating that the intervention can be expected to produce the desired outcomes. (4) The target population that will be served by the project. (5) The expected social benefits to participants who receive the intervention and others who may be impacted. (6) Projected Federal, State, and local government costs and other costs to conduct the project. (7) Projected Federal, State, and local government savings and other savings, including an estimate prepared by the State or local government of the savings to the Federal, State, and local government, on a program-by-program basis and in the aggregate, if the project is implemented and the outcomes are achieved. (8) If savings resulting from the successful completion of the project are estimated to accrue to the State or local government, the likelihood of the State or local government to realize those savings. (9) A plan for delivering the intervention through a social impact pay for performance contract model. (10) A description of the expertise of each service provider that will administer the intervention. (11) An explanation of the experience of the State or local government, the intermediary, or the service provider in raising private and philanthropic capital to fund social service investments. (12) The detailed roles and responsibilities of each entity involved in the project, including any State or local government entity, intermediary, service provider, independent evaluator, investor, or other stakeholder. (13) A summary of the experience of the service provider delivering the proposed intervention or a similar intervention, or a summary demonstrating that the service provider has the expertise necessary to deliver the proposed intervention. (14) A summary of the unmet need in the area where the intervention will be delivered or among the target population who will receive the intervention. (15) The payment terms, the methodology used to calculate outcome payments, the payment schedule, and performance thresholds. (16) The project budget. (17) The project timeline. (18) The criteria used to determine the eligibility of an individual for the project, including how selected populations will be identified, how they will be referred to the project, and how they will be enrolled in the project. (19) The evaluation design. (20) The metrics that will be used to determine whether the outcomes have been achieved and how such metrics will be measured. (21) A summary explaining the independence of the evaluator from the other entities involved in the project and the evaluator’s experience in conducting rigorous evaluations of program effectiveness including, where available, well-implemented randomized controlled trials on the intervention or similar interventions. (22) The capacity of the service provider to deliver the intervention to the number of participants the State or local government proposes to serve in the project. (d) Project intermediary information required The feasibility study described in subsection (c) shall also contain the following information about the intermediary for the social impact pay for performance contract project (whether the intermediary is the service provider or other entity): (1) Experience and capacity for providing or facilitating the provision of the type of intervention proposed. (2) The mission and goals. (3) Information on whether the intermediary is already working with service providers that provide this intervention or an explanation of the capacity of the intermediary to begin working with service providers to provide the intervention. (4) Experience working in a collaborative environment across government and nongovernmental entities. (5) Previous experience collaborating with public or private entities to implement evidence-based programs. (6) Ability to raise or provide funding to cover operating costs (if applicable to the project). (7) Capacity and infrastructure to track outcomes and measure results, including— (A) capacity to track and analyze program performance; and (B) experience with performance-based contracting and achieving project milestones and targets. (8) Role in delivering the intervention. (9) How the intermediary would monitor program success, including a description of the interim benchmarks and outcome measures. 2053. Awarding contracts for social impact pay for performance contract projects (a) Timeline in awarding contract Not later than 6 months after receiving an application in accordance with section 2052, the Secretary shall determine whether to enter into a contract for a social impact pay for performance contract project with the State or local government that submitted such application. (b) Considerations in Awarding Contract In determining whether to enter into a contract for a social impact pay for performance contract project with a State or local government, the Secretary, in consultation with the Federal Interagency Council on Social Impact Pay for Performance Contracts and the head of any Federal agency administering a similar intervention or serving a population similar to that served by the project, shall consider each of the following: (1) The value to the Federal Government of the outcome expected to be achieved if the outcomes specified in the contract are achieved. (2) The ability of the State or local government, in collaboration with the intermediary and the service providers, to achieve the outcomes. (3) The savings to the Federal Government if the outcomes specified in contract are achieved. (4) The savings to the State and local governments if the outcomes specific in the contract are achieved. (5) The expected quality of the evaluation that would be conducted with respect to the contract. (c) Contract Authority (1) Contract requirements In accordance with this section, the Secretary, in consultation with the Federal Interagency Council on Social Impact Pay for Performance Contracts and the head of any Federal agency administering a similar intervention or serving a population similar to that served by the project, may enter into a contract for a social impact pay for performance contract project with a State or local government if the Secretary determines that each of the following requirements are met: (A) The State or local government agrees to achieve an outcome specified in the contract in order to receive payment. (B) The Federal payment to the State or local government for each outcome specified does not exceed the monetary value of the outcome to the Federal Government over a period not to exceed 10 years, as determined by the Secretary, in consultation with the State or local government. (C) The duration of the project does not exceed 10 years. (D) The State or local government has demonstrated, through the application submitted under section 2052, that, based on prior rigorous experimental evaluations or rigorous quasi-experimental studies, the intervention can be expected to achieve each outcome specified in the contract. (E) The State, local government, intermediary, or service provider has experience raising private or philanthropic capital to fund social service investments (if applicable to the project). (F) The State or local government has shown that each service provider has experience delivering the intervention, a similar intervention, or has otherwise demonstrated the expertise necessary to deliver the intervention. (2) Payment The Secretary shall pay the State or local government only if the independent evaluator described in section 2055 determines that the social impact pay for performance contract project has met the requirements specified in the contract and achieved an outcome specified in the contract. (3) Limitation The Secretary shall not enter into a contract for a social impact pay for performance contract project under paragraph (1) after the date that is 10 years after the date of the enactment of this subtitle and shall not obligate any funds made available under section 2057(a) after such date. (d) Notice of contract award Not later than 30 days after entering into a contract under this section, the Secretary shall publish a notice in the Federal Register that includes, with regard to such contract, the following: (1) The outcome goals of the social impact pay for performance contract project. (2) A description of each intervention in the project. (3) The target population that will be served by the project. (4) The expected social benefits to participants who receive the intervention and others who may be impacted. (5) The detailed roles, responsibilities, and purposes of each Federal, State, or local government entity, intermediary, service provider, independent evaluator, investor, or other stakeholder. (6) The payment terms, the methodology used to calculate outcome payments, the payment schedule, and performance thresholds. (7) The project budget. (8) The project timeline. (9) The project eligibility criteria. (10) The evaluation design. (11) The metrics that will be used to determine whether the outcomes have been achieved and how these metrics will be measured. (12) The estimate prepared by the State or local government of the savings to the Federal, State, and local government, on a program-by-program basis and in the aggregate, if the contract is entered into and implemented and the outcomes are achieved. 2054. Feasibility study funding (a) Requests for funding for feasibility studies The Secretary shall reserve a portion of the funding provided in section 2057 to assist States or local governments in developing feasibility studies required by section 2052. To be eligible to receive funding to assist with completing a feasibility study, a State or local government shall submit an application for feasibility study funding containing the following information: (1) A description of the outcome goals of the social impact pay for performance contract project. (2) A description of the intervention, including anticipated program design, target population, an estimate regarding the number of individuals to be served, and setting for the intervention. (3) Evidence to support the likelihood that such intervention will produce the desired outcome. (4) The expected social benefits to participants who receive the intervention and others who may be impacted. (5) Estimated costs to conduct the project. (6) Estimates of Federal, State, and local government savings and other savings if the project is implemented and the outcomes are achieved. (7) An estimated timeline for implementation and completion of the project, which shall not exceed 10 years. (8) With respect to a project for which the State or local government selects an intermediary to operate the project, any partnerships needed to successfully execute the project and the ability of the intermediary to foster such partnerships. (9) The expected resources needed to complete the feasibility study for the State or local government to apply for social impact pay for performance contract funding under section 2052. (b) Federal selection of applications for feasibility study Not later than 6 months after receiving an application for feasibility study funding under subsection (a), the Secretary, in consultation with the Federal Interagency Council on Social Impact Pay for Performance Contracts and the head of any Federal agency administering a similar intervention or serving a population similar to that served by the project, shall select State or local government feasibility study proposals for funding based on the following: (1) The likelihood that the proposal will achieve the desired outcome. (2) The value of the outcome expected to be achieved. (3) The potential savings to the Federal Government if the social impact pay for performance contract project is successful. (4) The potential savings to the State and local governments if the project is successful. (c) Public disclosure Not later than 30 days after selecting a State or local government for feasibility study funding under this section, the Secretary shall publish on the website of the Federal Interagency Council on Social Impact Pay for Performance Contracts information explaining why the State or local government was granted feasibility study funding. (d) Funding restrictions; no guarantee of funding (1) Feasibility study restriction The Secretary shall not provide feasibility study funding under this section for more than 50 percent of the estimated total cost of the feasibility study reported in the State or local government application submitted under subsection (a). (2) Aggregate restriction Of the total amount appropriated under section 2057, the Secretary shall not use more than $10,000,000 to provide feasibility study funding to States or local governments under this section. (3) No guarantee of funding The Secretary shall have the option to award no funding under this section. (e) Submission of feasibility study required Not later than 6 months after the receipt of feasibility study funding under this section, a State or local government receiving such funding shall complete the feasibility study and submit the study to the Federal Interagency Council on Social Impact Pay for Performance Contracts. 2055. Evaluations (a) Contract Authority For each State or local government awarded a social impact pay for performance contract project approved by the Secretary under this subtitle, the head of the relevant agency, as determined by the Federal Interagency Council on Social Impact Pay for Performance Contracts, shall enter into a contract with such State or local government to pay for the independent evaluation required under section 2053(a)(2) to determine whether the State or local government project has met an outcome specified in the contract in order for the State or local government to receive outcome payments under this subtitle. (b) Evaluator Qualifications The head of the relevant agency may not enter into a contract with a State or local government under subsection (a) unless the head determines that the evaluator is independent of the other parties to the contract and has demonstrated substantial experience in conducting rigorous evaluations of program effectiveness including, where available and appropriate, well-implemented randomized controlled trials on the intervention or similar interventions. (c) Methodologies To be used (1) In general Subject to paragraph (2), the evaluation used to determine whether a State or local government will receive outcome payments under this subtitle shall, to the extent practicable, use methodologies based on experimental designs using random assignment, or, when random assignment is not feasible or appropriate, other reliable, evidence-based research methodologies, as certified by the Federal Interagency Council on Social Impact Pay for Performance Contracts, that allow for the strongest possible direct, causal inferences. (2) Limitation In determining whether an outcome has been achieved, the evaluation methodology selected under paragraph (1) shall not consider indirect potential savings to the Federal Government that may be realized from increased income, employment, output, or other economic measures derived from multiplier effects external to the outcome metrics upon which contract payments are based. (3) Application of Executive Order 13563 Executive Order 13563 (76 Fed. Reg. 3,821; relating to regulatory review) shall not apply to the development and selection of methodologies under this subsection. (d) Progress Report (1) Submission of report The independent evaluator shall— (A) not later than 2 years after a project has been approved by the Secretary and biannually thereafter until the project is concluded, submit to the head of the relevant agency and the Federal Interagency Council on Social Impact Pay for Performance Contracts a written report summarizing the progress that has been made in achieving each outcome specified in the contract; and (B) at the scheduled time of the first outcome payment and at the time of each subsequent payment, submit to the head of the relevant agency and the Federal Interagency Council on Social Impact Pay for Performance Contracts a written report that includes the results of the evaluation conducted to determine whether an outcome payment should be made along with information on the unique factors that contributed to achieving or failing to achieve the outcome, the challenges faced in attempting to achieve the outcome, and information on the improved future delivery of this or similar interventions. (2) Submission to Congress Not later than 30 days after receipt of the written report pursuant to paragraph (1)(B), the Federal Interagency Council on Social Impact Pay for Performance Contracts shall submit such report to each committee of jurisdiction in the House of Representatives and the Senate. (e) Final Report (1) Submission of report Within 6 months after the social impact pay for performance contract project is completed, the independent evaluator shall— (A) evaluate the effects of the activities undertaken pursuant to the contract with regard to each outcome specified in the contract; and (B) submit to the head of the relevant agency and the Federal Interagency Council on Social Impact Pay for Performance Contracts a written report that includes the results of the evaluation and the conclusion of the evaluator as to whether the State or local government has fulfilled each obligation of the contract, along with information on the unique factors that contributed to the success or failure of the project, the challenges faced in attempting to achieve the outcome, and information on the improved future delivery of this or similar interventions. (2) Submission to Congress Not later than 30 days after receipt of the written report pursuant to paragraph (1)(B), the Federal Interagency Council on Social Impact Pay for Performance Contracts shall submit such report to each committee of jurisdiction in the House of Representatives and the Senate. (f) Limitation on Cost of Evaluations Of the amount made available for social impact pay for performance contract projects in section 2057, the Secretary may not obligate more than 15 percent of such amount to evaluate the implementation and outcomes of such projects. 2056. Federal Interagency Council on Social Impact Pay for Performance Contracts (a) Establishment; duties There is established the Federal Interagency Council on Social Impact Pay for Performance Contracts (in this section, referred to as the Council (1) coordinate the efforts of social impact pay for performance contract projects funded by this subtitle; (2) advise and assist the Secretary in the development and implementation of such projects; (3) advise the Secretary on specific programmatic and policy matter related to such projects; (4) provide subject-matter expertise to the Secretary with regard to such projects; (5) ensure that each State or local government that has entered into a contract with the Secretary for a social impact pay for performance contract project under this subtitle and each evaluator selected by the head of the relevant agency under section 2055 has access to Federal administrative data to assist the State or local government and the evaluator in evaluating the performance and outcomes of the project; (6) provide guidance to the executive branch on the future of social impact pay for performance contract projects in the United States; (7) review State and local government applications for social impact pay for performance contract projects to ensure that contracts will only be awarded under this subtitle when rigorous, independent data and reliable, evidence-based research methodologies support the conclusion that a contract will yield savings to the Federal Government that are equal to or greater than the size of the outlay through the contract before such applications are approved by the Secretary; (8) certify, in the case of each approved social impact pay for performance contract project, that the project will yield a projected savings to the Federal Government, and coordinate with the relevant Federal agency to produce an after-action accounting once the project is complete to determine the actual Federal savings realized, and the extent to which actual savings aligned with projected savings; and (9) provide oversight of the actions of the Secretary and other Federal officials under this subtitle, and report periodically to Congress and the public on the implementation of this subtitle. (b) Composition of Council (1) Presidential appointees The President of the United States shall select 3 members of the Council, at least 1 of whom shall be an official of the Department of the Treasury and at least 1 of whom shall not be an employee of the Federal Government. The President shall designate 1 of these 3 members as the Chair of the Council. The Chair shall serve for a term of 7 years, and the other members selected by the President shall serve terms of 4 and 6 years. The President shall determine which member serves 4 years and which serves 6 years. (2) Additional appointees In addition to the 3 members appointed under paragraph (1), the Council shall be further composed of the following 8 members: (A) 1 member selected by the President of the United States from a list of candidates provided by the Majority Leader of the Senate; (B) 1 member selected by the President from a list of candidates provided by the Minority Leader of the Senate; (C) 1 member selected by the President from a list of candidates provided by the Speaker of the House of Representatives; (D) 1 member selected by the President from a list of candidates provided by the Minority Leader of the House of Representatives; (E) 1 member selected by the President from a list of candidates provided by the Chairman of the Committee on Finance of the Senate; (F) 1 member selected by the President from a list of candidates provided by the Ranking Member of the Committee on Finance of the Senate; (G) 1 member selected by the President from a list of candidates provided by the Chairman of the Committee on Ways and Means of the House of Representatives; and (H) 1 member selected by the President from a list of candidates provided by the Ranking Member of the Committee on Ways and Means of the House of Representatives. (3) Qualifications The membership of the Council shall consist of individuals who— (A) are experienced in finance, economics, pay for performance finance or statistics; (B) have relevant professional or personal experience in a field related to 1 or more of the outcomes listed in section 2052(b); and (C) are qualified to review applications for social impact pay for performance contract projects to determine whether the proposed metrics and evaluation methodologies are appropriately rigorous and reliant upon independent data and evidence-based research. (4) Timing of appointments (A) Candidate lists With respect to the candidate lists described in paragraph (2), the designated member of Congress shall provide a list of candidates to the President not later than 90 days after the date of the enactment of this subtitle, or, in the event of a vacancy, not later than 90 days after the date upon which the vacancy arises. If a member of Congress fails to provide a list of candidates to the President by such date, the President may select a member of the President's choice on behalf of such member of Congress. (B) Appointment date All appointments of the members of the Council shall be made not later than 120 days after the date of the enactment of this subtitle. Notwithstanding the preceding sentence, if not all appointments have been made to the Council as of such date, the Council may operate with fewer than all 11 members until all appointments have been made. (5) Term of appointments (A) In general The members appointed under paragraph (2) shall serve as follows: (i) 2 members shall serve for 3 years. (ii) 2 members shall serve for 4 years. (iii) 2 members shall serve for 5 years. (iv) 2 members shall serve for 6 years. (B) Assignment of terms The Council shall designate the term length that each member appointed under paragraph (2) shall serve by unanimous agreement. In the event that unanimous agreement cannot be reached, term lengths shall be assigned to such members by a random process. (6) Vacancies (A) In general Subject to subparagraph (B), in the event of a vacancy in the Council, whether due to the resignation of a member, the expiration of a member's term, or any other reason, such vacancy shall be filled in the manner in which the original appointment was made and shall not affect the powers of the Council. (B) Political party balance rule If the member of Congress required to provide a list of candidates under paragraph (2) to fill a vacancy in a position in accordance with this paragraph is not of the same political party as the member of Congress providing the list of candidates for the original appointment to such position, the list of candidates to fill such vacancy shall be provided instead by the member of the other political party occupying the corresponding position in the House of Congress or congressional committee concerned. (7) Appointment power Members of the Council appointed under this section shall not be subject to confirmation by the Senate. (c) Rules of the Council (1) Charter The Council shall file a charter that meets the requirements of section 9(c) of the Federal Advisory Committee Act (5 U.S.C. App.) with the Secretary. Such charter shall be published on the website the Council is required to establish under section 2058. (2) Council procedures Section 10 of the Federal Advisory Committee Act (5 U.S.C. App.), other than subsections (e) and (f), shall apply to the Council. (3) Transcripts Section 11 of the Federal Advisory Committee Act (5 U.S.C. App.) shall apply to the Council. (4) Compensation Members of the Council— (A) shall not receive compensation for service on the Council; and (B) 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 (d) Agency liaisons The Council shall liaise, as needed, with officers or employees of each Federal agency that becomes involved with the social impact pay for performance contract selection and obligation process who are designated by the head of the agency to serve as liaison to the Council. (e) Rule of construction Nothing in this section shall give the Council the authority to abrogate a contract entered into by the Secretary under section 2053, or any payment associated with such contract that is payable under such section. 2057. Funding (a) In general Out of any money in the Treasury not otherwise appropriated, there is hereby appropriated $300,000,000 to remain available until 10 years after the date specified in section 2053(c)(3) to carry out the activities authorized under this subtitle. Amounts appropriated under this subsection that are unobligated as of such date shall be rescinded on such date, except that the Secretary may retain an amount not to exceed $6,000,000 for an additional 3 years for purposes of carrying out functions necessary to administer contracts that were awarded under this subtitle prior to such date. (b) Limitation Of the amounts made available under subsection (a), the Secretary may not use more than $3,000,000 in any fiscal year to support the review, approval, and oversight of social impact pay for performance contract projects, including activities conducted by— (1) the Federal Interagency Council on Social Impact Pay for Performance Contracts; and (2) any other agency consulted by the Secretary before approving a social impact pay for performance contract project or a feasibility study under section 2054. 2058. Website The Federal Interagency Council on Social Impact Pay for Performance Contracts shall establish and maintain a public website that shall display the following: (1) A copy of, or method of accessing, each notice published regarding a social impact pay for performance contract project pursuant to this subtitle. (2) For each State or local government that has entered into a contract with the Secretary for a social impact pay for performance contract project, the website shall contain the following information: (A) The outcome goals of the project. (B) A description of each intervention in the project. (C) The target population that will be served by the project. (D) The expected social benefits to participants who receive the intervention and others who may be impacted. (E) The detailed roles, responsibilities, and purposes of each Federal, State, or local government entity, intermediary, service provider, independent evaluator, investor, or other stakeholder. (F) The payment terms, methodology used to calculate outcome payments, the payment schedule, and performance thresholds. (G) The project budget. (H) The project timeline. (I) The project eligibility criteria. (J) The evaluation design. (K) The metrics used to determine whether the proposed outcomes have been achieved and how these metrics are measured. (3) A copy of the progress reports and the final reports relating to each social impact pay for performance contract project. (4) An estimate of the savings to the Federal, State, and local government, on a program-by-program basis and in the aggregate, resulting from the successful completion of the social impact pay for performance contract project. (5) A copy of the Council's charter. 2059. Regulations The Secretary, in consultation with the Federal Interagency Council on Social Impact Pay for Performance Contracts, may issue regulations as necessary to carry out this subtitle. 2060. GAO Audits (a) Authority To audit The Comptroller General of the United States may audit the activities of any State, local government, or nongovernmental entity that receives funds under this subtitle. (b) Access to information (1) In general Notwithstanding any other provision of law, the Comptroller General shall, upon request and at such reasonable time and in such reasonable form as the Comptroller General may request, have access to— (A) any records or other information under the control of or used by any State, local government, or nongovernmental entity that receives funds under this subtitle; (B) any records or other information under the control of a person or entity acting on behalf of or under the authority of a State, local government, or nongovernmental entity that receives funds under this subtitle, to the extent that such records or other information is relevant to an audit under subsection (a); and (C) the officers, directors, employees, financial advisors, staff, working groups, and agents and representatives of any State, local government, or nongovernmental entity that receives funds under this subtitle (as related to the activities on behalf of such State, local government, or nongovernmental entity of such agent or representative), at such reasonable times as the Comptroller General may request. (2) Copies The Comptroller General may make and retain copies of such books, accounts, and other records, access to which is granted under this section, as the Comptroller General considers appropriate. 2061. Definitions In this subtitle: (1) Agency The term agency section 551 (2) Intervention The term intervention (3) Secretary The term Secretary (4) Social impact pay for performance contract project The term social impact pay for performance contract project (5) Social impact pay for performance contract model The term social impact pay for performance contract model (A) Federal funds are awarded to a State or local government only if a State or local government achieves certain outcomes agreed upon by the State or local government and the Secretary; and (B) the State or local government coordinates with service providers, investors (if applicable to the project), and (if necessary) an intermediary to identify— (i) an intervention expected to produce the outcome; (ii) a service provider to deliver the intervention to the target population; and (iii) investors to fund the delivery of the intervention. (6) State The term State . 3. Community Reinvestment Act Section 804 of the Community Reinvestment Act of 1977 ( 12 U.S.C. 2903 (e) Social impact pay for performance contract projects In assessing and taking into account, under subsection (a), the record of a financial institution, the appropriate Federal financial supervisory agency shall consider, as a factor, investments made by the financial institution in social impact pay for performance contract projects under subtitle C of title XX of the Social Security Act. .

Summary: Pay for Performance Act - Amends title XX (Block Grants to States for Social Services and Elder Justice) of the Social Security Act to add a new part C (Social Impact Pay for Performance Contracts). Requires the Secretary of the Treasury to publish in the Federal Register a request for proposals from states or local governments for social impact pay for performance contract projects which produce measurable, clearly defined outcomes that result in social benefit, such as employment for the unemployed, high school graduation, and reduction of teen and unplanned pregnancies as well as incidences of child abuse and neglect. Requires applications to include a feasibility study, funded under this Act, which contains specified information. Requires the Secretary to decide whether to enter into such a contract within six months after receiving an application. Requires independent evaluation of a state or local government social impact pay for performance contract project. Makes appropriations for 10 years to carry out this Act. Establishes the Federal Interagency Council on Social Impact Pay for Performance Contracts. Authorizes the Comptroller General (GAO) to audit the activities of any state, local government, or nongovernment that receives funds under this Act. Amends the Community Reinvestment Act of 1977 to require the appropriate federal financial supervisory agency to consider, in assessing and taking into account the record of a financial institution in meeting the credit needs of its entire community, its investments in social impact pay for performance contract projects.