(1) STATE
DISTRIBUTION
FACTOR.—Section 
2618(a)(2) of the Public Health Service Act (42 
U.S.C. 300ff–28(a)(2)) is amended— 
(A) in subparagraph (B), by striking ‘‘esti-
mated number of living cases of acquired im-
mune deficiency syndrome in the eligible area 
involved’’ and inserting ‘‘number of living cases 
of HIV/AIDS in the State involved’’; and 
(B) by amending subparagraph (D) to 
read as follows: 
‘‘(D) LIVING CASES OF HIV/AIDS.— 
‘‘(i) REQUIREMENT OF NAMES-BASED 
REPORTING.—Except as provided in clause 
(ii), the number determined under this 
subparagraph for a State for a fiscal year 
for purposes of subparagraph (B) is the 
number of living names-based cases of 
HIV/AIDS in the State that, as of Decem-
ber 31 of the most recent calendar year for 
which such data is available, have been re-
ported to and confirmed by the Director of 
the Centers for Disease Control and Pre-
vention. 
‘‘(ii) TRANSITION
PERIOD; EXEMP-
TION
REGARDING
NON-AIDS
CASES.—For 
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each of the fiscal years 2007 through 
2010, a State is, subject to clauses (iii) 
through (v), exempt from the requirement 
under clause (i) that living non-AIDS 
names-based cases of HIV be reported un-
less— 
‘‘(I) a system was in operation as 
of December 31, 2005, that provides 
sufficiently 
accurate 
and 
reliable 
names-based reporting of such cases 
throughout the State, subject to 
clause (vii); or 
‘‘(II) no later than the beginning 
of fiscal year 2008, 2009, or 2010, 
the Secretary, after consultation with 
the chief executive of the State, deter-
mines that a system has become oper-
ational in the State that provides suf-
ficiently accurate and reliable names- 
based 
reporting 
of 
such 
cases 
throughout the State. 
‘‘(iii) REQUIREMENTS
FOR
EXEMP-
TION FOR FISCAL YEAR 2007.—For fiscal 
year 2007, an exemption under clause (ii) 
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for a State applies only if, by October 1, 
2006— 
‘‘(I)(aa) the State had submitted 
to the Secretary a plan for making 
the transition to sufficiently accurate 
and reliable names-based reporting of 
living non-AIDS cases of HIV; or 
‘‘(bb) all statutory changes nec-
essary to provide for sufficiently accu-
rate and reliable reporting of such 
cases had been made; and 
‘‘(II) the State had agreed that, 
by April 1, 2008, the State will begin 
accurate and reliable names-based re-
porting of such cases, except that 
such agreement is not required to pro-
vide that, as of such date, the system 
for such reporting be fully sufficient 
with respect to accuracy and reli-
ability throughout the area. 
‘‘(iv) REQUIREMENT FOR EXEMPTION 
AS OF FISCAL YEAR 2008.—For each of the 
fiscal years 2008 through 2010, an exemp-
tion under clause (ii) for a State applies 
only if, as of April 1, 2008, the State is 
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substantially in compliance with the agree-
ment under clause (iii)(II). 
‘‘(v) 
PROGRESS
TOWARD
NAMES- 
BASED REPORTING.—For fiscal year 2009 
or 2010, the Secretary may terminate an 
exemption under clause (ii) for a State if 
the State submitted a plan under clause 
(iii)(I)(aa) and the Secretary determines 
that the State is not substantially following 
the plan. 
‘‘(vi) COUNTING OF CASES IN AREAS 
WITH EXEMPTIONS.— 
‘‘(I) IN GENERAL.—With respect 
to a State that is under a reporting 
system for living non-AIDS cases of 
HIV that is not names-based (referred 
to in this subparagraph as ‘code-based 
reporting’), the Secretary shall, for 
purposes of this subparagraph, modify 
the number of such cases reported for 
the State in order to adjust for dupli-
cative reporting in and among systems 
that use code-based reporting. 
‘‘(II) ADJUSTMENT
RATE.—The 
adjustment rate under subclause (I) 
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for a State shall be a reduction of 5 
percent in the number of living non- 
AIDS cases of HIV reported for the 
State. 
‘‘(vii) LIST
OF
STATES
MEETING 
STANDARD
REGARDING
DECEMBER
31, 
2005.— 
‘‘(I) IN GENERAL.—If a State is 
specified in subclause (II), the State 
shall be considered to meet the stand-
ard described in clause (ii)(I). No 
other State may be considered to meet 
such standard. 
‘‘(II) RELEVANT
STATES.—For 
purposes of subclause (I), the States 
specified in this subclause are the fol-
lowing: Alaska, Alabama, Arkansas, 
Arizona, Colorado, Florida, Indiana, 
Iowa, 
Idaho, 
Kansas, 
Louisiana, 
Michigan, Minnesota, Missouri, Mis-
sissippi, North Carolina, North Da-
kota, Nebraska, New Jersey, New 
Mexico, New York, Nevada, Ohio, 
Oklahoma, South Carolina, South Da-
kota, Tennessee, Texas, Utah, Vir-
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ginia, Wisconsin, West Virginia, Wyo-
ming, Guam, and the Virgin Islands. 
‘‘(viii) RULES OF CONSTRUCTION RE-
GARDING ACCEPTANCE OF REPORTS.— 
‘‘(I) CASES OF AIDS.—With re-
spect to a State that is subject to the 
requirement under clause (i) and is 
not in compliance with the require-
ment for names-based reporting of liv-
ing non-AIDS cases of HIV, the Sec-
retary shall, notwithstanding such 
noncompliance, accept reports of liv-
ing cases of AIDS that are in accord-
ance with such clause. 
‘‘(II) APPLICABILITY OF EXEMP-
TION
REQUIREMENTS.—The 
provi-
sions of clauses (ii) through (vii) may 
not be construed as having any legal 
effect for fiscal year 2011 or any sub-
sequent fiscal year, and accordingly, 
the status of a State for purposes of 
such clauses may not be considered 
after fiscal year 2010. 
‘‘(ix) PROGRAM FOR DETECTING INAC-
CURATE
OR
FRAUDULENT
COUNTING.— 
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