109
the project, from the standpoint of quality, of 
cost-effectiveness, or of both; and 
(B) a description of the performance objec-
tives for the project, including any proposed 
modifications to the performance measures and 
reporting requirements used in the programs. 
(4) WAIVERS
REQUESTED.—A description of 
the statutory and regulatory requirements with re-
spect to which a waiver is requested in order to 
carry out the project, and a justification of the need 
for each such waiver. 
(5) COST NEUTRALITY.—Such information and 
assurances as necessary to establish to the satisfac-
tion of the administering Secretary, in consultation 
with the Director of the Office of Management and 
Budget, that the proposed project is reasonably ex-
pected to meet the applicable cost neutrality require-
ments of subsection (d)(4). 
(6) EVALUATION AND REPORTS.—An assurance 
that the applicant will conduct ongoing and final 
evaluations of the project, and make interim and 
final reports to the administering Secretary, at such 
times and in such manner as the administering Sec-
retary may require.
110
(7) PUBLIC HOUSING AGENCY PLAN.—In the 
case of an application proposing a demonstration 
project that includes activities referred to in sub-
section (b)(2)(H) of this section—
(A) a certification that the applicable an-
nual public housing agency plan of any agency 
affected by the project that is approved under 
section 5A of the United States Housing Act of 
1937 (42 U.S.C. 1437c–1) by the Secretary in-
cludes the information specified in paragraphs 
(1) through (4) of this subsection; and 
(B) any resident advisory board rec-
ommendations, and other information, relating 
to the project that, pursuant to section 
5A(e)(2) of the United States Housing Act of 
1937 (42 U.S.C. 1437c–1(e)(2), is required to 
be included in the public housing agency plan of 
any public housing agency affected by the 
project. 
(8) OTHER INFORMATION AND ASSURANCES.—
Such other information and assurances as the ad-
ministering Secretary may require. 
(d) APPROVAL OF APPLICATIONS.—
(1) IN GENERAL.—The administering Secretary 
with respect to a qualified program that is identified
111
in an application submitted pursuant to subsection 
(c) may approve the application and, except as pro-
vided in paragraph (2), waive any requirement appli-
cable to the program, to the extent consistent with 
this section and necessary and appropriate for the 
conduct of the demonstration project proposed in the 
application, if the administering Secretary deter-
mines that the project—
(A) has a reasonable likelihood of achieving 
the objectives of the programs to be included in 
the project; 
(B) may reasonably be expected to meet 
the applicable cost neutrality requirements of 
paragraph (4), as determined by the Director of 
the Office of Management and Budget; and 
(C) includes the coordination of 2 or more 
qualified programs. 
(2) PROVISIONS EXCLUDED FROM WAIVER AU-
THORITY.—A waiver shall not be granted under 
paragraph (1)—
(A) with respect to any provision of law re-
lating to—
(i) civil rights or prohibition of dis-
crimination; 
(ii) purposes or goals of any program;
112
(iii) maintenance of effort require-
ments; 
(iv) health or safety; 
(v) labor standards under the Fair 
Labor Standards Act of 1938; or 
(vi) environmental protection; 
(B) with respect to section 241(a) of the 
Adult Education and Family Literacy Act; 
(C) in the case of a program under the 
United States Housing Act of 1937 (42 U.S.C. 
1437 et seq.), with respect to any requirement 
under section 5A of such Act (42 U.S.C. 
1437c–1; relating to public housing agency 
plans and resident advisory boards); 
(D) in the case of a program under the 
Workforce Investment Act, with respect to any 
requirement the waiver of which would violate 
section 189(i)(4)(A)(i) of such Act; 
(E) in the case of the food stamp program 
(as defined in section 3(h) of the Food Stamp 
Act of 1977 (7 U.S.C. 2012(h)), with respect to 
any requirement under—
(i) section 6 (if waiving a requirement 
under such section would have the effect of 
expanding eligibility for the program), 7(b)
113
or 16(c) of the Food Stamp Act of 1977 
(7 U.S.C. 2011 et seq.); or 
(ii) title IV of the Personal Responsi-
bility and Work Opportunity Reconciliation 
Act of 1996 (8 U.S.C. 1601 et seq.); 
(F) with respect to any requirement that a 
State pass through to a sub-State entity part or 
all of an amount paid to the State; 
(G) if the waiver would waive any funding 
restriction or limitation provided in an appro-
priations Act, or would have the effect of trans-
ferring appropriated funds from 1 appropria-
tions account to another; or 
(H) except as otherwise provided by stat-
ute, if the waiver would waive any funding re-
striction applicable to a program authorized 
under an Act which is not an appropriations 
Act (but not including program requirements 
such as application procedures, performance 
standards, reporting requirements, or eligibility 
standards), or would have the effect of transfer-
ring funds from a program for which there is 
direct spending (as defined in section 250(c)(8) 
of the Balanced Budget and Emergency Deficit 
Control Act of 1985) to another program.
114
(3) AGREEMENT OF EACH ADMINISTERING SEC-
RETARY REQUIRED.—
(A) IN GENERAL.—An applicant may not 
conduct a demonstration project under this sec-
tion unless each administering Secretary with 
respect to any program proposed to be included 
in the project has approved the application to 
conduct the project. 
(B) AGREEMENT WITH RESPECT TO FUND-
ING AND IMPLEMENTATION.—Before approving 
an application to conduct a demonstration 
project under this section, an administering 
Secretary shall have in place an agreement with 
the applicant with respect to the payment of 
funds and responsibilities required of the ad-
ministering Secretary with respect to the 
project. 
(4) COST-NEUTRALITY REQUIREMENT.—
(A) 
GENERAL
RULE.—Notwithstanding 
any other provision of law (except subparagraph 
(B)), the total of the amounts that may be paid 
by the Federal Government for a fiscal year 
with respect to the programs in the State in 
which an entity conducting a demonstration 
project under this section is located that are af-
115
fected by the project shall not exceed the esti-
mated total amount that the Federal Govern-
ment would have paid for the fiscal year with 
respect to the programs if the project had not 
been conducted, as determined by the Director 
of the Office of Management and Budget. 
(B) SPECIAL RULE.—If an applicant sub-
mits to the Director of the Office of Manage-
ment and Budget a request to apply the rules 
of this subparagraph to the programs in the 
State in which the applicant is located that are 
affected by a demonstration project proposed in 
an application submitted by the applicant pur-
suant to this section, during such period of not 
more than 5 consecutive fiscal years in which 
the project is in effect, and the Director deter-
mines, on the basis of supporting information 
provided by the applicant, to grant the request, 
then, notwithstanding any other provision of 
law, the total of the amounts that may be paid 
by the Federal Government for the period with 
respect to the programs shall not exceed the es-
timated total amount that the Federal Govern-
ment would have paid for the period with re-
116
spect to the programs if the project had not 
been conducted. 
(5) 90-DAY APPROVAL DEADLINE.—
(A) IN
GENERAL.—If an administering 
Secretary receives an application to conduct a 
demonstration project under this section and 
does not disapprove the application within 90 
days after the receipt, then—
(i) the administering Secretary is 
deemed to have approved the application 
for such period as is requested in the ap-
plication, except to the extent inconsistent 
with subsection (e); and 
(ii) any waiver requested in the appli-
cation which applies to a qualified program 
that is identified in the application and is 
administered by the administering Sec-
retary is deemed to be granted, except to 
the extent inconsistent with paragraph (2) 
or (4) of this subsection. 
(B) DEADLINE EXTENDED IF ADDITIONAL 
INFORMATION IS SOUGHT.—The 90-day period 
referred to in subparagraph (A) shall not in-
clude any period that begins with the date the 
Secretary requests the applicant to provide ad-
117
ditional information with respect to the applica-
tion and ends with the date the additional in-
formation is provided. 
(e) DURATION
OF
PROJECTS.—A demonstration 
project under this section may be approved for a term of 
not more than 5 years. 
(f) REPORTS TO CONGRESS.—
(1) REPORT
ON
DISPOSITION
OF
APPLICA-
TIONS.—Within 90 days after an administering Sec-
retary receives an application submitted pursuant to 
this section, the administering Secretary shall sub-
mit to each Committee of the Congress which has 
jurisdiction over a qualified program identified in 
the application notice of the receipt, a description of 
the decision of the administering Secretary with re-
spect to the application, and the reasons for approv-
ing or disapproving the application. 
(2) REPORTS
ON
PROJECTS.—Each admin-
istering Secretary shall provide annually to the Con-
gress a report concerning demonstration projects ap-
proved under this section, including—
(A) the projects approved for each appli-
cant;
118
(B) the number of waivers granted under 
this section, and the specific statutory provi-
sions waived; 
(C) how well each project for which a waiv-
er is granted is improving or enhancing pro-
gram achievement from the standpoint of qual-
ity, cost-effectiveness, or both; 
(D) how well each project for which a 
waiver is granted is meeting the performance 
objectives specified in subsection (c)(3)(B); 
(E) how each project for which a waiver is 
granted is conforming with the cost-neutrality 
requirements of subsection (d)(4); and 
(F) to the extent the administering Sec-
retary deems appropriate, recommendations for 
modification of programs based on outcomes of 
the projects. 
(g) AMENDMENT TO UNITED STATES HOUSING ACT 
OF 1937.—Section 5A(d) of the United States Housing 
Act of 1937 (42 U.S.C. 1437c–1(d)) is amended—
(1) by redesignating paragraph (18) as para-
graph (19); and 
(2) by inserting after paragraph (17) the fol-
lowing new paragraph:
119
‘‘(18) PROGRAM
COORDINATION
DEMONSTRA-
TION PROJECTS.—In the case of an agency that ad-
ministers 
an 
activity 
referred 
to 
in 
section 
601(b)(2)(H) of the Personal Responsibility, Work, 
and Family Promotion Act of 2005 that, during 
such fiscal year, will be included in a demonstration 
project under section 601 of such Act, the informa-
tion that is required to be included in the application 
for the project pursuant to paragraphs (1) through 
(4) of section 601(b) of such Act.’’. 
SEC. 602. STATE FOOD ASSISTANCE BLOCK GRANT DEM-
ONSTRATION PROJECT. 
The Food Stamp Act of 1977 (7 U.S.C. 2011 et seq.) 
is amended by adding at the end the following: 
‘‘SEC. 28. STATE FOOD ASSISTANCE BLOCK GRANT DEM-
ONSTRATION PROJECT. 
‘‘(a) ESTABLISHMENT.—The Secretary shall estab-
lish a program to make grants to States in accordance 
with this section to provide—
‘‘(1) food assistance to needy individuals and 
families residing in the State; 
‘‘(2) funds to operate an employment and train-
ing program under subsection (g) for needy individ-
uals under the program; and
120
‘‘(3) funds for administrative costs incurred in 
providing the assistance. 
‘‘(b) ELECTION.—
‘‘(1) IN GENERAL.—A State may elect to par-
ticipate in the program established under subsection 
(a). 
‘‘(2) ELECTION
REVOCABLE.—A State that 
elects to participate in the program established 
under subsection (a) may subsequently reverse the 
election of the State only once thereafter. Following 
the reversal, the State shall only be eligible to par-
ticipate in the food stamp program in accordance 
with the other sections of this Act and shall not re-
ceive a block grant under this section. 
‘‘(3) PROGRAM
EXCLUSIVE.—A State that is 
participating in the program established under sub-
section (a) shall not be subject to, or receive any 
benefit under, this Act except as provided in this 
section. 
‘‘(c) LEAD AGENCY.—
‘‘(1) DESIGNATION.—A State desiring to par-
ticipate in the program established under subsection 
(a) shall designate, in an application submitted to 
the Secretary under subsection (d)(1), an appro-
121
priate State agency that complies with paragraph 
(2) to act as the lead agency for the State. 
‘‘(2) DUTIES.—The lead agency shall—
‘‘(A) administer, either directly, through 
other State agencies, or through local agencies, 
the assistance received under this section by the 
State; 
‘‘(B) develop the State plan to be sub-
mitted to the Secretary under subsection (d)(1); 
and 
‘‘(C) coordinate the provision of food as-
sistance under this section with other Federal, 
State, and local programs. 
‘‘(d) APPLICATION AND PLAN.—
‘‘(1) APPLICATION.—To be eligible to receive 
assistance under this section, a State shall prepare 
and submit to the Secretary an application at such 
time, in such manner, and containing such informa-
tion as the Secretary shall by regulation require, in-
cluding—
‘‘(A) an assurance that the State will com-
ply with the requirements of this section; 
‘‘(B) a State plan that meets the require-
ments of paragraph (2); and
122
‘‘(C) an assurance that the State will com-
ply with the requirements of the State plan 
under paragraph (2). 
‘‘(2) REQUIREMENTS OF PLAN.—
‘‘(A) LEAD AGENCY.—The State plan shall 
identify the lead agency. 
‘‘(B) USE OF BLOCK GRANT FUNDS.—The 
State plan shall provide that the State shall use 
the amounts provided to the State for each fis-
cal year under this section—
‘‘(i) to provide food assistance to 
needy individuals and families residing in 
the State, other than residents of institu-
tions who are ineligible for food stamps 
under section 3(i); 
‘‘(ii) to administer an employment 
and training program under subsection (g) 
for needy individuals under the program 
and to provide reimbursements to needy 
individuals and families as would be al-
lowed under section 16(h)(3); and 
‘‘(iii) to pay administrative costs in-
curred in providing the assistance. 
‘‘(C) ASSISTANCE FOR ENTIRE STATE.—
The State plan shall provide that benefits under
123
this section shall be available throughout the 
entire State. 
‘‘(D) NOTICE AND HEARINGS.—The State 
plan shall provide that an individual or family 
who applies for, or receives, assistance under 
this section shall be provided with notice of, and 
an opportunity for a hearing on, any action 
under this section that adversely affects the in-
dividual or family. 
‘‘(E) OTHER ASSISTANCE.—
‘‘(i) COORDINATION.—The State plan 
may coordinate assistance received under 
this section with assistance provided under 
the State program funded under part A of 
title IV of the Social Security Act (42 
U.S.C. 601 et seq.). 
‘‘(ii) PENALTIES.—If an individual or 
family is penalized for violating part A of 
title IV of the Act, the State plan may re-
duce the amount of assistance provided 
under this section or otherwise penalize the 
individual or family. 
‘‘(F) 
ELIGIBILITY
LIMITATIONS.—The 
State plan shall describe the income and re-
124
source eligibility limitations that are established 
for the receipt of assistance under this section. 
‘‘(G) RECEIVING BENEFITS IN MORE THAN 
1 JURISDICTION.—The State plan shall estab-
lish a system to verify and otherwise ensure 
that no individual or family shall receive bene-
fits under this section in more than 1 jurisdic-
tion within the State. 
‘‘(H) PRIVACY.—The State plan shall pro-
vide for safeguarding and restricting the use 
and disclosure of information about any indi-
vidual or family receiving assistance under this 
section. 
‘‘(I) OTHER
INFORMATION.—The State 
plan shall contain such other information as 
may be required by the Secretary. 
‘‘(3) APPROVAL OF APPLICATION AND PLAN.—
During fiscal years 2006 through 2010, the Sec-
retary may approve the applications and State plans 
that satisfy the requirements of this section of not 
more than 5 States for a term of not more than 5 
years. 
‘‘(e) CONSTRUCTION
OF
FACILITIES.—No funds 
made available under this section shall be expended for 
the purchase or improvement of land, or for the purchase,