I
105TH CONGRESS
2D SESSION
H. R. 4030
To make child care more affordable for working families and for stay-at-
home parents with children under the age of 4, to double the number
of children receiving child care assistance, to provide for after-school
care, and to improve child care safety and quality and enhance early
childhood development.
IN THE HOUSE OF REPRESENTATIVES
JUNE 10, 1998
Mrs. KENNELLY of Connecticut (for herself, Mrs. TAUSCHER, Mr. FAZIO of
California, Mr. GEPHARDT, Ms. DELAURO, Mr. LEVIN, Mr. WEYGAND,
Ms. LOFGREN, Mr. DOGGETT, Mrs. CLAYTON, Mr. MCDERMOTT, Mr.
ABERCROMBIE, Ms. SLAUGHTER, Ms. WOOLSEY, Mr. HOYER, Mrs.
MALONEY of New York, Mrs. LOWEY, Mr. ALLEN, Ms. CARSON, Ms.
STABENOW, Mr. MANTON, Mr. MORAN of Virginia, Ms. JACKSON-LEE of
Texas, Mr. ACKERMAN, Mr. ANDREWS, Mr. BALDACCI, Mr. BARRETT of
Wisconsin, Mr. BECERRA, Mr. BENTSEN, Mr. BLUMENAUER, Mr.
BONIOR, Mr. BORSKI, Mr. BOSWELL, Mr. BOUCHER, Mr. BRADY of
Pennsylvania, Ms. BROWN of Florida, Mr. BROWN of California, Mr.
BROWN of Ohio, Mrs. CAPPS, Ms. CHRISTIAN-GREEN, Mr. CLAY, Mr.
CLEMENT, Mr. CONYERS, Mr. COSTELLO, Mr. CUMMINGS, Mr. DAVIS of
Illinois, Ms. DEGETTE, Mr. DELAHUNT, Mr. DICKS, Mr. DINGELL, Mr.
ENGEL, Mr. EVANS, Mr. FALEOMAVAEGA, Mr. FARR of California, Mr.
FATTAH, Mr. FILNER, Mr. FORD, Mr. FROST, Ms. FURSE, Mr. GEJDEN-
SON, Mr. GORDON, Ms. HARMAN, Mr. HASTINGS of Florida, Mr. HEF-
NER, Mr. HINCHEY, Mr. HINOJOSA, Mr. HOLDEN, Ms. HOOLEY of Or-
egon, Mr. JEFFERSON, Ms. EDDIE BERNICE JOHNSON of Texas, Mr.
KANJORSKI, Ms. KAPTUR, Mr. KENNEDY of Massachusetts, Mr. KEN-
NEDY of Rhode Island, Ms. KILPATRICK, Mr. LAMPSON, Mr. LANTOS,
Mr. LEE, Mr. LEWIS of Georgia, Mr. MARTINEZ, Mr. MATSUI, Mrs.
MCCARTHY of New York, Ms. MCCARTHY of Missouri, Mr. MCGOVERN,
Mr. MCNULTY, Mrs. MEEK of Florida, Mr. MEEKS of New York, Ms.
MILLENDER-MCDONALD, Mr. MILLER of California, Mrs. MINK of Ha-
waii, Mr. MOAKLEY, Mr. NADLER, Mr. NEAL of Massachusetts, Ms.
NORTON, Mr. OBERSTAR, Mr. OLVER, Mr. PALLONE, Mr. PAYNE, Ms.
PELOSI, Mr. POSHARD, Mr. PRICE of North Carolina, Mr. RAHALL, Mr.
RODRIGUEZ, Mr. ROMERO-BARCELO´, Mr. SABO, Ms. SANCHEZ, Mr.
SANDLIN, Mr. SAWYER, Mr. SCHUMER, Mr. SCOTT, Mr. SERRANO, Mr.
SHERMAN, Mr. SNYDER, Mr. STARK, Mr. STOKES, Mrs. THURMAN, Mr.
TORRES, Mr. UNDERWOOD, Ms. VELA´ZQUEZ, Mr. VENTO, Ms. WATERS,
Mr. WAXMAN, Mr. WEXLER, Mr. WYNN, and Mr. YATES) introduced the
following bill; which was referred to the Committee on Ways and Means,
and in addition to the Committees on Education and the Workforce,
Banking and Financial Services, and the Judiciary, for a period to be
subsequently determined by the Speaker, in each case for consideration
of such provisions as fall within the jurisdiction of the committee con-
cerned
A BILL
To make child care more affordable for working families
and for stay-at-home parents with children under the
age of 4, to double the number of children receiving
child care assistance, to provide for after-school care,
and to improve child care safety and quality and enhance
early childhood development.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Affordable and Quality
Child Care Act of 1998’’.
SEC. 2. TABLE OF CONTENTS.
The table of contents of this Act is as follows:
Sec. 1. Short title.
Sec. 2. Table of contents.
TITLE I—FUNDING FOR CHILD CARE
Sec. 101. Child care subsidy funding.
TITLE II—DEPENDENT CARE TAX CREDIT REFORM
Sec. 201. Increase in dependent care tax credit; equivalent benefit where one
parent stays at home to provide child care for child under age
4.
Sec. 202. Allowance of credit for employer expenses for child care assistance.
Sec. 203. Dependent care credit allowed against the alternative minimum tax.
Sec. 952. Congressional findings.
Sec. 953. Insurance for mortgages on new and rehabilitated child care and de-
velopment facilities.
Sec. 954. Insurance for mortgages for acquisition or refinancing debt of exist-
ing child care and development facilities.
Sec. 955. Children’s Development Commission.
Sec. 956. Study of availability of secondary markets for mortgages on child
care facilities.
Subtitle C—Sense of the Congress
Sec. 971. Sense of the Congress.
TITLE I—FUNDING FOR CHILD
CARE
SEC. 101. CHILD CARE SUBSIDY FUNDING.
(a) APPROPRIATION; ALLOCATION.—Section 418 of
the Social Security Act (42 U.S.C. 618) is amended—
(1) by redesignating subsections (b), (c), and
(d) as subsections (d), (e), and (f), respectively; and
(2) by inserting after subsection (a) the follow-
ing:
‘‘(b) CHILD CARE SUBSIDY FUNDING.—
‘‘(1) APPROPRIATION.—Out of any money in
the Treasury of the United States not otherwise ap-
propriated, there are appropriated to carry out this
subsection—
‘‘(A) $1,155,000,000 for fiscal year 1999;
‘‘(B) $1,280,000,000 for fiscal year 2000;
‘‘(C) $1,400,000,000 for fiscal year 2001;
‘‘(D) $1,600,000,000 for fiscal year 2002;
and
‘‘(E) $2,065,000,000 for fiscal year 2003.
‘‘(2) 
RESERVATION
AND
ALLOTMENT
OF
FUNDS.—
‘‘(A) AMONG
INDIAN
TRIBES.—The Sec-
retary shall reserve 2 percent of the total
amount appropriated pursuant to paragraph (1)
of this subsection for any fiscal year for pay-
ments to Indian tribes. From the amount so re-
served for a fiscal year, the Secretary shall allot
to an Indian tribe for the fiscal year an amount
that bears the same proportion to the amount
so reserved as the proportion of funds provided
to the Indian tribe under section 658O(c) of the
CCDBG Act for the fiscal year bears to the
total amount paid to all Indian tribes under
such section for the fiscal year.
‘‘(B) QUALITY ASSURANCE AND QUALITY
IMPROVEMENT ACTIVITIES.—From all amounts
appropriated pursuant to paragraph (1) of this
subsection, the Secretary shall reserve an aggre-
gate of $1,000,000, which shall be available
only for quality assurance and quality improve-
ment activities relating to programs under the
CCDBG Act.
‘‘(C) AMONG
THE
STATES
AND
TERRI-
TORIES.—The Secretary shall allot the total
amount appropriated pursuant to paragraph (1)
of this subsection for a fiscal year that remains
after applying subparagraphs (A) and (B) of
this paragraph for the fiscal year, among the
States and the territories pursuant to the for-
mula specified in section 403(n) (as such sec-
tion was in effect before August 22, 1996),
without regard to any limitation imposed by
section 1108.
‘‘(3) MATCHING
PAYMENTS
TO
STATES
AND
TERRITORIES.—
‘‘(A) IN GENERAL.—Notwithstanding sec-
tion 1108, the Secretary shall pay to each State
and territory for a fiscal year an amount equal
to the lesser of—
‘‘(i) the amount allotted to the State
or territory for the fiscal year under para-
graph (2)(C) of this subsection; or
‘‘(ii) 80 percent of expenditures by the
State or territory during the fiscal year—
‘‘(I) that are for any purpose au-
thorized under the approved plan of
the State or territory under the
CCDBG Act;
‘‘(II) that, in the case of a State,
are in excess of expenditures nec-
essary to secure payment of the full
amount of the State’s allotment (if
any) under subsection (a)(2) of this
section (determined without regard to
subparagraph (D) thereof); and
‘‘(III) for which Federal match-
ing payments or reimbursements are
not otherwise authorized to be made.
‘‘(B) 
REDISTRIBUTION.—Subsection
(a)(2)(D) shall apply to amounts allotted to
States under this subsection.
‘‘(4) PAYMENTS TO INDIAN TRIBES.—The Sec-
retary shall pay to an Indian tribe for a fiscal year
an amount equal to the lesser of—
‘‘(A) the amount allotted to the Indian
tribe under paragraph (2)(A) of this subsection
for the fiscal year; or
‘‘(B) the total amount of expenditures by
the Indian tribe during the fiscal year for pur-
poses authorized under the CCDBG Act for
which Federal payments are not otherwise au-
thorized to be made.
‘‘(5) TARGETING OF FUNDS.—
‘‘(A) CHILD CARE ASSISTANCE FOR WORK-
ING NON-WELFARE FAMILIES.—A State or ter-
ritory to which amounts are provided under this
subsection shall use not less than 70 percent of
the amounts for child care assistance to work-
ing families who are not recipients of assistance
under the State or territory program funded
under section 403(a)(1).
‘‘(B) CHILD CARE ASSISTANCE FOR YOUNG
CHILDREN.—A State or territory to which
amounts are provided under this subsection
shall use not less than 40 percent of the
amounts for child care assistance for children
who have not attained 4 years of age.’’.
(b) INCLUSION OF TERRITORIES IN DEFINITIONS.—
Section 418(f) of such Act, as so redesignated by sub-
section (a)(1) of this section, is amended to read as fol-
lows:
‘‘(f) DEFINITIONS.—In this section:
‘‘(1) CCDBG ACT.—The term ‘CCDBG Act’
means the Child Care and Development Block Grant
Act of 1990 (42 U.S.C. 9801 et seq.).
‘‘(2) STATE.—The term ‘State’ means each of
the 50 States, the District of Columbia, and (except
for purposes of subsection (a)) the Commonwealth of
Puerto Rico.
‘‘(3) TERRITORY.—The term ‘territory’ means
the United States Virgin Islands, Guam, American
Samoa, and the Commonwealth of the Northern
Mariana Islands.’’.
(c) CONFORMING AMENDMENTS.—
(1) Section 418(a)(3) of such Act (42 U.S.C.
618(a)(3)) is amended by striking ‘‘section’’ and in-
serting ‘‘subsection’’.
(2) Section 418(c) of such Act, as so redesig-
nated by subsection (a)(1) of this section, is amend-
ed in paragraphs (1) and (2) by striking ‘‘under this
section’’ each place it appears and inserting ‘‘under
subsection (a)’’.
TITLE II—DEPENDENT CARE TAX
CREDIT REFORM
SEC. 201. INCREASE IN DEPENDENT CARE TAX CREDIT;
EQUIVALENT BENEFIT WHERE ONE PARENT
STAYS AT HOME TO PROVIDE CHILD CARE
FOR CHILD UNDER AGE 4.
(a) IN GENERAL.—Paragraph (2) of section 21(a) of
the Internal Revenue Code of 1986 (relating to expenses
for household and dependent care services necessary for
gainful employment) is amended to read as follows: