595
ances of appropriations, allocations, and other funds em-
ployed, used, held, available, or to be made available in
connection with a function transferred to an official by
this subtitle shall be available to the official at such time
or times as the President directs for use in connection with
the functions transferred.
SEC. 10185. DELEGATION AND ASSIGNMENT.
Except as otherwise expressly prohibited by law or
otherwise provided in this subtitle, an official to whom
functions are transferred under this subtitle (including the
head of any office to which functions are transferred under
this subtitle) may delegate any of the functions so trans-
ferred to such officers and employees of the office of the
official as the official may designate, and may authorize
successive redelegations of such functions as may be nec-
essary or appropriate. No delegation of functions under
this section or under any other provision of this subtitle
shall relieve the official to whom a function is transferred
under this subtitle of responsibility for the administration
of the function.
SEC. 10186. AUTHORITY OF OFFICE OF MANAGEMENT AND
BUDGET 
WITH 
RESPECT 
TO 
FUNCTIONS
TRANSFERRED.
(a) DETERMINATIONS.—If necessary, the Director of
the Office of Management and Budget shall make any de-
596
termination of the functions that are transferred under
this subtitle.
(b) INCIDENTAL TRANSFERS.—The Director of the
Office of Management and Budget, at such time or times
as the Director shall provide, may make such determina-
tions as may be necessary with regard to the functions
transferred by this subtitle, and to make such additional
incidental dispositions of personnel, assets, liabilities,
grants, contracts, property, records, and unexpended bal-
ances of appropriations, authorizations, allocations, and
other funds held, used, arising from, available to, or to
be made available in connection with such functions, as
may be necessary to carry out the provisions of this sub-
title. The Director of the Office of Management and Budg-
et shall provide for the termination of the affairs of all
entities terminated by this subtitle and for such further
measures and dispositions as may be necessary to effec-
tuate the purposes of this subtitle.
SEC. 10187. PROPOSED CHANGES IN LAW.
Not later than 90 days before the effective date speci-
fied in section 10119, the Director of the Office of Man-
agement and Budget shall submit to the Congress a de-
scription of any changes in Federal law necessary to re-
flect abolishments, transfers, terminations, and disposals
under this subtitle.
597
SEC. 10188. DEFINITION OF TRANSFER.
For purposes of this chapter, the vesting of a func-
tion in a department or office pursuant to reestablishment
of an office shall be considered to be the transfer of the
function.
SEC. 10189. DEFINITIONS.
For purposes of this chapter, the following definitions
shall apply:
(1) DIRECTOR.—The term ‘‘Director’’ means
the Director for Economic Opportunities in the Ad-
ministration for Families and Children in the De-
partment of Health and Human Services, estab-
lished under section 10112(a).
(2) FUNCTION.—The term ‘‘function’’ includes
any duty, obligation, power, authority, responsibility,
right, privilege, activity, or program.
(3) OFFICE.—The term ‘‘Office’’ means the Of-
fice of Economic Opportunities in the Department of
Health and Human Services, established under sec-
tion 10112(a).
CHAPTER 5—STATEMENTS OF POLICY
SEC. 10191. STATEMENT OF POLICY REGARDING FEDERAL
EDUCATION FUNDING.
Congress finds that there should be a review and eval-
uation as to the feasibility of further enhancing the ability
of States and local communities to fund education by re-
598
ducing the Federal tax burden and commensurately elimi-
nating Federal Government involvement in providing
grants for education programs.
SEC. 10192. STATEMENT OF POLICY REGARDING JOB
TRAINING PROGRAMS.
The Congress finds that all job training programs
under the jurisdiction of the Department of Education—
(1) should be reviewed and transferred to the
Department of Labor; and
(2) should be consolidated into 1 or more block
grants.
SEC. 10193. STATEMENT OF POLICY REGARDING INDIAN
EDUCATION.
Congress finds that any program transferred as a re-
sult of this subtitle to the Department of the Interior
should be reviewed by Congress to ensure that such pro-
grams benefit Native American children that live on res-
ervations.
Subtitle C—Elementary and
Secondary Education Reforms
SEC. 10201. ELIMINATION OF IMPACT AID.
(a) IN GENERAL.—Title VIII of the Elementary and
Secondary Education Act of 1965 (20 U.S.C. 7701 et
seq.) is hereby repealed.
599
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall take effect on October 1, 1995, or the
date of the enactment of this Act, whichever occurs later.
SEC. 10202. EISENHOWER REGIONAL MATHEMATICS AND
SCIENCE EDUCATION CONSORTIA.
Title XIII of the Elementary and Secondary Edu-
cation Act of 1965 is amended by striking part C.
SEC. 10203. LIMITATION ON AUTHORIZATIONS OF APPRO-
PRIATIONS FOR THE INDIVIDUALS WITH DIS-
ABILITIES EDUCATION ACT.
Part A of the Individuals with Disabilities Education
Act (20 U.S.C. 1400 et seq.) is amended by adding at
the end the following:
‘‘LIMITATION ON AUTHORIZATIONS OF APPROPRIATIONS
‘‘SEC. 610A. Notwithstanding any other provision of
this title, the aggregate amount of funds authorized to be
appropriated to carry out this title may not exceed
$3,252,846,000 for each of the fiscal years 1996 through
2000.’’.
SEC. 10204. EDUCATION IMPROVEMENT.
Not more than $320,298,000 may be made available
to carry out the Eisenhower Professional Development
State Grant program under title II of the Elementary and
Secondary Education Act of 1965 for each of fiscal years
1996, 1997, 1998, 1999, and 2000.
600
SEC. 10205. INNOVATIVE EDUCATION PROGRAM STRATE-
GIES.
Not more than $347,250,000 may be available to
carry out State grant programs under title VI of the Ele-
mentary and Secondary Education Act of 1965 for each
of fiscal years 1996, 1997, 1998, 1999, and 2000.
SEC. 10206. SAFE AND DRUG-FREE SCHOOLS AND COMMU-
NITIES.
(a) STATE GRANTS.—Not more than $456,962,000
may be available to carry out State grant programs under
subpart 1 of part A of title IV of the Elementary and
Secondary Education Act of 1965 for each of fiscal years
1996, 1997, 1998, 1999, and 2000.
(b) 
NATIONAL
PROGRAMS.—Not 
more 
than
$25,000,000 may be available to carry out National pro-
grams under subpart 2 of part A of title IV of the Elemen-
tary and Secondary Education Act of 1965 for each of
fiscal years 1996, 1997, 1998, 1999, and 2000.
SEC. 10207. EDUCATION INFRASTRUCTURE.
Not more than $100,000,000 may be made available
to carry out education infrastructure programs under title
XII of the Elementary and Secondary Education Act of
1965 for each of fiscal years 1996, 1997, 1998, 1999, and
2000.
601
SEC. 10208. INEXPENSIVE BOOK DISTRIBUTION.
Not more than $10,300,000 may be made available
to carry out the Inexpensive Book Distribution program
under part E of title X of the Elementary and Secondary
Education Act of 1965 for each of fiscal years 1996, 1997,
1998, 1999, and 2000.
SEC. 10209. ARTS IN EDUCATION.
Not more than $12,000,000 may be made available
to carry out the Arts in Education Program under part
D of title X of the Elementary and Secondary Education
Act of 1965 for each of fiscal years 1996, 1997, 1998,
1999, and 2000.
SEC. 10210. CHRISTA McAULIFFE SCHOLARSHIPS.
Not more than $1,946,000 may be made available to
carry out Christa McAuliffe Scholarships by the Depart-
ment of Education for each of fiscal years 1996, 1997,
1998, 1999, and 2000.
SEC. 10211. MAGNET SCHOOLS ASSISTANCE.
Not more than $111,519,000 may be made available
to carry out the Magnet Schools Assistance program
under part A of title V of the Elementary and Secondary
Education Act of 1965 for each of fiscal years 1996, 1997,
1998, 1999, and 2000.
602
SEC. 10212. EDUCATION FOR HOMELESS CHILDREN AND
YOUTH.
Not more than $28,811,000 may be made available
to carry out Education for Homeless Children and Youth
programs under subtitle B of title VII of the Stewart B.
McKinney Homeless Assistance Act for each of fiscal
years 1996, 1997, 1998, 1999, and 2000.
SEC. 10213. WOMEN’S EDUCATIONAL EQUITY.
Not more than $3,967,000 may be made available to
carry out the Women’s Educational Equity programs
under part B of title V of the Elementary and Secondary
Education Act of 1965 for each of fiscal years 1996, 1997,
1998, 1999, and 2000.
SEC. 10214. TRAINING AND ADVISORY SERVICES.
Not more than $21,419,000 may be made available
to the Department of Education to carry out the Training
and Advisory services under title IV–A of the Civil Rights
Act for each of fiscal years 1996, 1997, 1998, 1999, and
2000.
SEC. 10215. DROPOUT DEMONSTRATIONS.
Not more than $28,000,000 may be made available
to carry out the School Dropout program under part C
of title V of the Elementary and Secondary Education Act
of 1965 for each of fiscal years 1996, 1997, 1998, 1999,
and 2000.
603
SEC. 10216. TRAINING IN EARLY CHILDHOOD EDUCATION
AND VIOLENCE COUNSELING.
Not more than $13,875,000 may be made available
to the Department of Education to carry out Early Child-
hood Education and Violence Training programs for each
of fiscal years 1996, 1997, 1998, 1999, and 2000.
SEC. 10217. CHARTER SCHOOLS.
Not more than $6,000,000 may be made available to
carry out the Charter Schools program under part C of
title X of the Elementary and Secondary Education Act
of 1965 for each of fiscal years 1996, 1997, 1998, 1999,
and 2000.
SEC. 10218. AUTHORIZED ACTIVITIES.
Part A of title II of the Elementary and Seconday
Education Act of 1965 is amended by striking section
2101.
SEC. 10219. PROFESSIONAL DEVELOPMENT DEMONSTRA-
TION PROJECT.
Title II of the Elementary and secondary Education
Act of 1965 is amended by striking part C.
SEC. 10220. IMMIGRANT EDUCATION.
Title VII of the Elementary and Secondary Edu-
cation Act of 1965 is amended by striking parts B and
C.
604
SEC. 10221. EDUCATION FOR NATIVE HAWAIIANS.
Title IX of the Elementary and Secondary Education
Act of 1965 is amended by striking part B.
SEC. 10222. PROGRAMS OF NATIONAL SIGNIFICANCE.
Title X of the Elementary and Secondary Education
Act of 1965 is amended by striking parts A, G, and H.
SEC. 10223. LAW-RELATED EDUCATION.
Part F of title X of the Elementary and Secondary
Education Act of 1965 is amended by striking section
10602.
SEC. 10224. PUBLIC LIBRARY CONSTRUCTION.
Title III of the Improving America’s Schools Act of
1994 is amended by striking part G.
SEC. 10225. NATIONAL ASSESSMENT OF EDUCATIONAL
PROGRESS.
Title IV of the Improving America’s Schools Act of
1994 is amended by striking section 411.
Subtitle D—Community Program
Reforms
SEC. 10301. REPEAL OF THE NATIONAL FOUNDATION ON
THE ARTS AND THE HUMANITIES ACT OF
1965.
(a) REPEAL OF THE NATIONAL FOUNDATION ON
THE ARTS AND THE HUMANITIES ACT OF 1965.—The
National Foundation on the Arts and the Humanities Act
of 1965 (20 U.S.C. 951–60) is repealed.
605
(b) TRANSITION PROVISIONS.—The Director of the
Office of Management and Budget shall provide for the
termination of the affairs of the Federal entities termi-
nated by the repeal made by subsection (a), including the
appropriate transfer or other disposition of personnel, as-
sets, liabilities, grants, contracts, property, records, and
unexpended balances of appropriations, authorizations, al-
locations, and other funds held, used, arising from, avail-
able to, or to be made available in connection with imple-
menting the authorities terminated by the repeal made by
subsection (a).
(c) EFFECTIVE DATE.—This section shall take effect
on October 1, 1995.
SEC. 10302. REPEAL OF NATIONAL AND COMMUNITY SERV-
ICE ACT OF 1990, DOMESTIC VOLUNTEER
SERVICE ACT OF 1973, AND RELATED PROVI-
SIONS.
(a) NATIONAL AND COMMUNITY SERVICE ACT OF
1990.—Effective October 1, 1995, the National and Com-
munity Service Act of 1990 (42 U.S.C. 12501 et seq.) is
repealed.
(b) DOMESTIC
VOLUNTEER
SERVICE
ACT
OF
1973.—Effective October 1, 1995, the Domestic Volun-
teer Service Act of 1973 (42 U.S.C. 4950 et seq.) is re-
pealed.
606
(c) PUBLIC LANDS CORPS.—Effective October 1,
1995, title II of Public Law 91–378 (16 U.S.C. 1721 et
seq.), as added by section 105 of the National and Com-
munity Service Trust Act of 1993 (Public Law 103–82;
107 Stat. 848), is repealed.
(d) URBAN YOUTH CORPS.—Effective October 1,
1995, section 106 of the National and Community Service
Trust Act of 1993 (42 U.S.C. 12656) is repealed.
(e) NATIONAL GUARD CIVILIAN YOUTH OPPORTUNI-
TIES PILOT PROGRAM.—Effective October 1, 1995, sec-
tion 1091 of the National Defense Authorization Act for
Fiscal Year 1993 (Public Law 102–484; 32 U.S.C. 501
note) is repealed.
(f) EFFECT OF REPEAL.—Upon the repeal of the
provisions specified in this section, the President shall as-
sign to an agency of the United States the responsibility
for liquidating the affairs of the entities or activities elimi-
nated as a result of the repeal. The property, records, and
unexpended balances (available or to be made available)
of appropriations, allocations, and other funds of the
eliminated entities and activities shall be transferred to
such agency. The repeal of such provisions shall not affect
any obligation incurred by the eliminated entities and ac-
tivities before October 1, 1995, and the agency responsible
for liquidating the affairs of the eliminated entities and
607
activities shall satisfy such obligations, subject to the same
terms and conditions that would apply in the absence of
the repeal.
SEC. 10303. REPEAL OF THE MUSEUM SERVICES ACT.
(a) REPEALER.—Title II of the Arts, Humanities,
and Cultural Affairs Act of 1976 (20 U.S.C. 961–969)
is repealed.
(b) EFFECTIVE DATE.—Subsection (a) shall take ef-
fect on October 1, 1995.
SEC. 10304. TERMINATE FEDERAL FUNDING FOR THE JOHN
F. KENNEDY CENTER FOR THE PERFORMING
ARTS.
Section 12 of the John F. Kennedy Center Act (20
U.S.C. 76r) is repealed.
SEC. 10305. REPEAL OF THE OLDER AMERICANS COMMU-
NITY SERVICE EMPLOYMENT ACT.
(a) REPEALER.—Title V of the Older Americans Act
of 1965 (42 U.S.C. 3056–3056i) is repealed.
(b) EFFECTIVE DATE.—Subsection (a) shall take ef-
fect on October 1, 1995.
SEC. 10306. CONSOLIDATION OF CERTAIN SOCIAL SERVICE
PROGRAMS.
(a) AMENDMENT TO TITLE XX OF THE SOCIAL SE-
CURITY ACT.—
608
(1) PAYMENTS TO STATES.—Section 2002(a)(2)
of the Social Security Act (40 U.S.C. 1397a(a)(2))
is amended—
(A) in subparagraph (A)—
(i) by inserting ‘‘, services to meet
housing and energy needs,’’ after ‘‘health
support services’’, and
(ii) by striking ‘‘and’’ at the end,
(B) in subparagraph (B)—
(i) in clause (ii) by striking ‘‘and’’ at
the end,
(ii) in clause (iii) by striking the pe-
riod at the end and inserting ‘‘; and’’, and
(iii) by inserting after clause (iii) the
following:
‘‘(iv) activities—
‘‘(I) to plan, develop, establish,
expand, improve, or operate before-
and after-school child care programs
for school-age children, and resource
and referral systems that provide in-
formation on dependent care services;
and
‘‘(II) to improve the quality of
child care, and to increase the avail-
609
ability of early childhood development
and before- and after-school child care
services.’’.
(2) ALLOTMENTS.—Section 2003(c) of the So-
cial Security Act (40 U.S.C. 1397b(c)) is amended—
(A) in paragraph (4) by striking ‘‘and’’ at
the end,
(B) in paragraph (5) by striking ‘‘each fis-
cal year after fiscal year 1989.’’ and inserting
‘‘each of the fiscal years 1990, 1991, 1992,
1993, 1994, and 1995; and
(C) by adding at the end the following:
‘‘(6) $4,009,379,000 for fiscal year 1996.’’.
(b) REPEALERS.—
(1) COMMUNITY
SERVICES
BLOCK
GRANT
ACT.—Subtitle B of title VI of the Omnibus Budget
Reconciliation Act of 1981 (42 U.S.C. 9901–9912)
is repealed.
(2) CHILD CARE AND DEVELOPMENT BLOCK
GRANT ACT.—Subchapter C of chapter 8 of subtitle
A of title VI of the Omnibus Budget Reconciliation
Act of 1981 (42 U.S.C. 9858–9858S) is repealed.
(3) STATE DEPENDENT CARE DEVELOPMENT
GRANTS ACT.—Subchapter E of chapter 8 of sub-
title A of title VI of the Omnibus Budget Reconcili-
610
ation Act of 1981 (42 U.S.C. 9871–9877) is re-
pealed.
(c) EFFECTIVE DATE.—Subsections (a) and (b) shall
take effect on October 1, 1995.
SEC. 10307. AMENDMENTS TO THE OLDER AMERICANS ACT
OF 1965.
(a) FEDERAL COUNCIL
ON
THE AGING.—Section
204(g) of the Older Americans Act of 1965 (42 U.S.C.
3015(g)) is amended—
(1) by striking ‘‘are’’ and inserting ‘‘is’’, and
(2) by striking ‘‘$300,000’’ and all that follows
through ‘‘1995’’, and inserting ‘‘$176,000 for each
of the fiscal years 1996, 1997, 1998, 1999, and
2000’’.
(b) AUTHORIZATION OF APPROPRIATIONS FOR TITLE
II OF THE ACT.—Section 215 of the Older Americans Act
of 1965 (42 U.S.C. 3020f) is amended—
(1) in subsection (a) by striking ‘‘such sums’’
and all that follows through ‘‘1995’’, and inserting
‘‘$16,524,000 for each of the fiscal years 1996,
1997, 1998, 1999, and 2000’’, and
(2) in subsection (b) by amending paragraph
(1) to read as follows:
‘‘(1) $29,000,000 for each of the fiscal years
1996, 1997, 1998, 1999, and 2000; and’’.
611
(c) AUTHORIZATION OF APPROPRIATIONS FOR TITLE
III OF THE ACT.—
(1) SUPPORTIVE SERVICES AND SENIOR CEN-
TERS.—Section 303(a)(1) of the Older Americans
Act of 1965 (42 U.S.C. 3023(a)(1)) is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘$461,376,000’’ and all
that follows through ‘‘1995’’, and inserting
‘‘$306,711,000 for each of the fiscal years
1996, 1997, 1998, 1999, and 2000’’.
(2) CONGREGATE NUTRITION SERVICES.—Sec-
tion 303(b)(1) of the Older Americans Act of 1965
(42 U.S.C. 3023(b)(1)) is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘$505,000,000’’ and all
that follows through ‘‘1995’’, and inserting
‘‘$375,809,000 for each of the fiscal years
1996, 1997, 1998, 1999, and 2000’’.
(3) HOME-DELIVERED NUTRITION SERVICES.—
Section 303(b)(2) of the Older Americans Act of
1965 (42 U.S.C. 3023(b)(2)) is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
612
(B) by striking ‘‘$120,000,000’’ and all
that follows through ‘‘1995’’, and inserting
‘‘$93,665,000 for each of the fiscal years 1996,
1997, 1998, 1999, and 2000’’.
(4) 
SCHOOL-BASED
MEALS
FOR
VOLUN-
TEERS.—Section 303(b)(3) of the Older Americans
Act of 1965 (42 U.S.C. 3023(b)(3)) is amended-
(1) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(2) by striking ‘‘fiscal year 1992’’ and all
that follows through ‘‘1995’’, and inserting ‘‘for
each of the fiscal years 1996, 1997, 1998,
1999, and 2000’’.
(5) IN-HOME SERVICES.—Section 303(d) of the
Older Americans Act of 1965 (42 U.S.C. 3023(d))
is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘$45,388,000’’ and all that
follows 
through 
‘‘1995’’, 
and 
inserting
‘‘$7,075,000 for each of the fiscal years 1996,
1997, 1998, 1999, and 2000’’.
(6) SPECIAL
NEEDS.—Section 303(e) of the
Older Americans Act of 1965 (42 U.S.C. 3023(e))
is amended by striking ‘‘1992’’ and all that follows
613
through ‘‘1995’’, and inserting ‘‘1996, 1997, 1998,
1999, and 2000’’.
(7) 
PREVENTIVE
HEALTH, 
HEALTH
EDU-
CATION, AND
PROMOTION.—Section 303(f) of the
Older Americans Act of 1965 (42 U.S.C. 3023(f)) is
amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘$25,000,000’’ and all that
follows 
through 
‘‘1995’’, 
and 
inserting
‘‘$16,982,000 for each of the fiscal years 1996,
1997, 1998, 1999, and 2000’’.
(8) 
SUPPORTIVE
ACTIVITIES
FOR
CARE-
TAKERS.—Section 303(g) of the Older Americans
Act of 1965 (42 U.S.C. 3023(g)) is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’, and
(B) by striking ‘‘fiscal year 1992’’ and all that
follows through ‘‘1995’’, and inserting ‘‘each of the
fiscal years 1996, 1997, 1998, 1999, and 2000’’.
(9) PURCHASE
OF
AGRICULTURAL
COMMOD-
ITIES
FOR
NUTRITION
SERVICES.—Section
311(c)(1)(A) of the Older Americans Act of 1965
(42 U.S.C. 3030a(c)(1)(A)) is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
614
(B) by striking ‘‘$250,000,000’’ and all
that follows through ‘‘1994, and’’, and
(C) by striking ‘‘fiscal year 1995’’ and in-
serting ‘‘each of the fiscal years 1996, 1997,
1998, 1999, and 2000’’.
(d) AUTHORIZATION OF APPROPRIATIONS FOR TITLE
IV OF THE ACT.—
(1) TRAINING, RESEARCH, AND DISCRETIONARY
PROJECTS
AND
PROGRAMS.—Section 431(a)(1) of
the Older Americans Act of 1965 (42 U.S.C.
3037(a)(1)) is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘$72,000,000’’ and all that
follows 
through 
‘‘1995’’, 
and 
inserting
‘‘$25,735,000 for each of the fiscal years 1996,
1997, 1998, 1999, and 2000’’.
(2) TRAINING.—Section 431(b) of the Older
Americans Act of 1965 (42 U.S.C. 3037(b)) is
amended by striking ‘‘1992’’ and all that follows
through ‘‘1995’’, and inserting ‘‘1996, 1997, 1998,
1999, and 2000’’.
(e) AUTHORIZATION OF APPROPRIATIONS FOR TITLE
VI OF THE ACT.—Section 633(a) of the Older Americans
Act of 1965 (42 U.S.C. 3037n(a)) is amended—
615
(1) by striking ‘‘are’’ and inserting ‘‘is’’, and
(2) by striking ‘‘$30,000,000’’ and all that fol-
lows through ‘‘1995’’, and inserting ‘‘$16,902,000
for each of the fiscal years 1996, 1997, 1998, 1999,
and 2000’’.
(f) AUTHORIZATION OF APPROPRIATIONS FOR TITLE
VII OF THE ACT.—
(1) OMBUDSMAN PROGRAM.—Section 702(a) of
the Older Americans Act of 1965 (42 U.S.C.
3058a(a)) is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘$40,000,000’’ and all that
follows 
through 
‘‘1995’’, 
and 
inserting
‘‘$4,370,000 for each of the fiscal years 1996,
1997, 1998, 1999, and 2000’’.
(2) PREVENTION OF ELDER ABUSE, NEGLECT,
AND EXPLOITATION.—Section 702(b) of the Older
Americans Act of 1965 (42 U.S.C. 3058a(b)) is
amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘$15,000,000’’ and all that
follows 
through 
‘‘1995’’, 
and 
inserting
616
‘‘$4,638,000 for each of the fiscal years 1996,
1997, 1998, 1999, and 2000’’.
(3) STATE ELDER RIGHTS AND LEGAL ASSIST-
ANCE DEVELOPMENT PROGRAM.—Section 702(c) of
the Older Americans Act of 1965 (42 U.S.C.
3058a(c)) is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘fiscal year 1992’’ and all
that follows through ‘‘1995’’, and inserting
‘‘each of the fiscal years 1996, 1997, 1998,
1999, and 2000’’.
(4) OUTREACH, COUNSELING, AND ASSISTANCE
PROGRAM.—Section 702(d) of the Older Americans
Act of 1965 (42 U.S.C. 3058a(d)) is amended—
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘$15,000,000’’ and all that
follows 
through 
‘‘1995’’, 
and 
inserting
‘‘$1,976,000 for each of the fiscal years 1996,
1997, 1998, 1999, and 2000’’.
(5) NATIVE
AMERICAN
ORGANIZATION
PROVI-
SION.—Section 751(d) of the Older Americans Act
of 1965 (42 U.S.C. 3058aa(d)) is amended—
617
(A) by striking ‘‘are’’ and inserting ‘‘is’’,
and
(B) by striking ‘‘fiscal year 1992’’ and all
that follows through ‘‘1995’’, and inserting ‘‘for
each of the fiscal years 1996, 1997, 1998,
1999, and 2000’’.
(g) EFFECTIVE DATE.—The amendments made by
this section shall take effect on October 1, 1995.
SEC. 10308. TERMINATION OF FUNDING FOR THE COR-
PORATION FOR PUBLIC BROADCASTING
Part IV of title III of the Communications Act of
1934 (47 U.S.C. 390 to 399b), relating to assistance for
public telecommunications facilities, telecommunications
demonstrations, and the Corporation for Public Broad-
casting, is repealed.
Subtitle E—Employment Program
Reform
SEC. 10401. TERMINATION OF GENERAL TRADE ADJUST-
MENT ASSISTANCE.
(a) TERMINATION OF PROGRAM EXTENSION.—(1)
Section 285(c)(1) of the Trade Act of 1974 (19 U.S.C.
2271 preceding note), is amended by striking ‘‘1998’’ and
inserting ‘‘1995’’.
(2) Section 245(a) of the Trade Act of 1974 (19
U.S.C. 2317(a)) is amended by striking ‘‘each of the fiscal
618
years 1993, 1994, 1995, 1996, 1997, and 1998’’ and in-
serting ‘‘fiscal year 1995’’.
(b) 
CONFORMING
AMENDMENT.—Section
236(a)(2)(A) of the Trade Act of 1974 (19 U.S.C.
2296(a)(2)(A)) is amended by striking ‘‘, except that’’ and
all that follows through ‘‘$70,000,000’’.
SEC. 10402. EXTENSION TO ALL STATES OF RULE PROVID-
ING FOR REDUCTION OF SOCIAL SECURITY
DISABILITY INSURANCE BENEFITS UPON RE-
CEIPT OF WORKERS’ COMPENSATION BENE-
FITS.
(a) PREEMPTION OF STATE LAWS REDUCING PERI-
ODIC BENEFITS BY REASON OF ENTITLEMENT TO DIS-
ABILITY INSURANCE BENEFITS.—Section 224(d) of the
Social Security Act (42 U.S.C. 224a(d)) is amended to
read as follows:
‘‘(d) The provisions of this section shall supersede
any provision of a law or plan of any State, of any political
subdivision (as that term is used in section 218(b)(2)),
or of any instrumentality of two or more States (as that
term is used in section 218(g)) to the extent that the effect
of such provision is to reduce periodic benefits referred
to in subparagraph (A) or (B) of subsection (a)(2) of any
individual under such law or plan on the basis of the enti-
tlement of such individual to benefits under section 223.’’.
619
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply with respect to individuals who
first become entitled to benefits under section 223(a) of
the Social Security Act for months beginning on or after
January 1, 1996.
SEC. 10403. SERVICE CONTRACT ACT OF 1965.
(a) REPEAL.—The Service Contract Act of 1965 (41
U.S.C. 351 et seq.) is repealed.
(b) APPLICATION.—The amendment made by sub-
section (a) shall not apply to a contract which was entered
into before the date of the enactment of this Act and to
which the Service Contract Act of 1965 applied.
SEC. 10404. REDUCTION IN OVERHEAD EXPENSES OF DE-
PARTMENT OF LABOR.
(a) IN GENERAL.—The amount obligated by the De-
partment of Labor during fiscal year 1996 for overhead
expenses shall not exceed an amount sufficient to reduce
outlays for such expenses during such fiscal year (as com-
pared to such outlays during fiscal year 1995) by
$67,000,000.
(b) OVERHEAD EXPENSES.—For purposes of this
section, the term ‘‘overhead expenses’’ means expenses
within the following object classifications established by
the Director of the Office of Management and Budget:
(1) 21.0 (travel and transportation of persons).
620
(2) 22.0 (transportation of things).
(3) 23.1 (rental payments to GSA).
(4) 23.3 (communications, utilities, and mis-
cellaneous charges).
(5) 24.0 (printing and reproduction).
(6) 25.1 (consulting services).
(7) 25.2 (other services).
(8) 25.5 (research and development contracts).
(9) 26.0 (supplies and materials).
(10) 31 (equipment).
TITLE XI—HEALTH
Subtitle A—Administrative Reform
SEC. 11001. REDUCTION IN OVERHEAD EXPENSES OF DE-
PARTMENT OF HEALTH AND HUMAN SERV-
ICES.
(a) IN GENERAL.—The amount obligated by the De-
partment of Health and Human Services during fiscal
year 1996 for overhead expenses shall not exceed an
amount sufficient to reduce outlays for such expenses dur-
ing such fiscal year (as compared to such outlays during
fiscal year 1995) by $346,000,000.
(b) OVERHEAD EXPENSES.—For purposes of this
section, the term ‘‘overhead expenses’’ means expenses
within the following object classifications established by
the Director of the Office of Management and Budget:
621
(1) 21.0 (travel and transportation of persons).
(2) 22.0 (transportation of things).
(3) 23.1 (rental payments to GSA).
(4) 23.3 (communications, utilities, and mis-
cellaneous charges).
(5) 24.0 (printing and reproduction).
(6) 25.1 (consulting services).
(7) 25.2 (other services).
(8) 25.5 (research and development contracts).
(9) 26.0 (supplies and materials).
(10) 31 (equipment).
Subtitle 
B—University 
Research
Regarding Health and Other
Matters
SEC. 
11101. 
FEDERALLY-SUPPORTED 
UNIVERSITY 
RE-
SEARCH; REDUCTION IN RATES FOR INDI-
RECT COSTS OF RESEARCH.
(a) AUTHORITY OF FEDERAL AGENCIES REGARDING
INDIRECT COSTS OF SUPPORTED RESEARCH.—In making
an award of financial assistance to an institution of higher
education for a fiscal year for a project of research, the
head of the Federal agency involved is subject to the fol-
lowing:
(1) The agency head may in accordance with
this section authorize the institution to expend a
622
portion of the award for costs that are indirectly re-
lated to the conduct of the project, and are appro-
priate for the institution to maintain the program or
programs of which the project is a part (which costs
regarding a project of research are referred to in
this section as ‘‘indirect costs’’).
(2) The agency head may not make the award
for the project unless the institution—
(A) agrees that the award will be expended
for the indirect costs of the project only in ac-
cordance with determinations made under this
section by the agency head regarding the
project; and
(B) certifies to the agency head that each
award of financial assistance provided by the
agency head to the institution for the imme-
diately preceding fiscal year for a project of re-
search was expended in accordance with the de-
terminations made under this section regarding
the project.
(b) DIRECT
AND
INDIRECT
COSTS
AS
TOTAL
AMOUNT OF ASSISTANCE.—With respect to a project of
research for which the head of a Federal agency is under
subsection (a)(1) authorizing an award for a fiscal year
to be expended for indirect costs, the total amount of the
623
award provided for the project for such year shall consist
of an amount provided for the direct costs of the project,
together with the sum of—
(1) the aggregate amount the agency head de-
termines under subparagraph (A) of subsection
(c)(1) for the administrative categories of indirect
cost; and
(2) the aggregate amount the agency head de-
termines under subparagraph (B) of such subsection
for the nonadministrative categories of such costs.
(c) DETERMINATION OF AMOUNTS FOR ADMINISTRA-
TIVE AND NONADMINISTRATIVE CATEGORIES.—
‘‘(1) IN GENERAL.—With respect to a project of
research for which the head of a Federal agency is
under subsection (a)(1) authorizing an award for a
fiscal year to be expended for indirect costs, the
agency head, after consultation with the institution
of higher education involved and after consideration
of relevant records and materials, shall make a de-
termination of—
‘‘(A) the amount, expressed as a percent-
age in accordance with paragraph (2), that is
authorized to be expended for the administra-
tive categories of indirect cost (determined indi-
624
vidually for each of such categories or deter-
mined in the aggregate for the categories); and
‘‘(B) the amount, expressed as a percent-
age in accordance with paragraph (2), that is
authorized 
to 
be 
made 
for 
the 
nonad-
ministrative categories of indirect cost (deter-
mined individually for each of such categories
or determined in the aggregate for the cat-
egories).
‘‘(2) CATEGORY PERCENTAGES; MODIFIED DI-
RECT COSTS.—The amounts determined under sub-
paragraphs (A) and (B) of paragraph (1) for a fiscal
year with respect to a project of research shall be
determined as a percentage of the modified direct
costs of the project. The percentage so determined
may not exceed the applicable percentage specified
in subsection (d), and shall be in effect only during
the fiscal year for which the financial assistance in-
volved is provided.
(d) GENERAL LIMITATIONS REGARDING CATEGORY
PERCENTAGES.—
(1) REDUCTION IN RATE FOR ADMINISTRATIVE
CATEGORIES.—With respect to an award made by
the head of a Federal agency to an institution of
higher education for a fiscal year for a project of
625
research, the percentage determined under sub-
section (c)(2) for the fiscal year for an administra-
tive category of indirect costs may not exceed 90
percent of an amount equal to the mean average of
the percentages applicable to the institution for the
category for awards by the agency head to the insti-
tution for fiscal year 1995.
(2) 
REDUCTION
IN
RATE
FOR
NONAD-
MINISTRATIVE
CATEGORIES.—With respect to an
award made by the head of a Federal agency to an
institution of higher education for a fiscal year for
a project of research, the percentage determined
under subsection (c)(2) for the fiscal year for a
nonadministrative category of indirect costs may not
exceed 90 percent of an amount equal to the mean
average of the percentages applicable to the institu-
tion for the category for awards by the agency head
to the institution for fiscal year 1995.
(e) INSTITUTION-SPECIFIC UNIFORM RATES ACROSS
AWARDS.—With respect to multiple awards made by the
head of a Federal agency to an institution of higher edu-
cation for a fiscal year for projects of research, the agency
head may, for each of the categories of indirect costs (ad-
ministrative and nonadministrative), determine a single
percentage under subsection (c) that will be applicable to
626
the category for all such awards by the agency head to
the institution for the fiscal year. Any such determination
is subject to subsection (d).
(f) FAILURE TO COMPLY WITH LIMITATION.—In the
case of an institution of higher education making an
agreement under subsection (a)(2) regarding expenditures
for the indirect costs of a project of research, if the head
of the Federal agency involved determines that the institu-
tion has made an expenditure in violation of the agree-
ment, the agency head shall recover from the institution
an amount equal to the amount of the expenditure, to-
gether with an amount representing interest on the
amount of such expenditure.
(g) DEFINITIONS.—For purposes of this section:
(1) The term ‘‘administrative categories’’, with
respect to the indirect costs of a project of research,
means the categories of general administration, de-
partmental administration, and administration of
the project of research involved (also known as spon-
sored project administration).
(2) The term ‘‘award’’ means an award of fi-
nancial assistance.
(3) The term ‘‘direct costs’’, with respect to a
project of research, has the meaning given such term
627
by the Director of the Office of Management and
Budget.
(4) The term ‘‘Federal agency’’ means each de-
partment, agency or instrumentality of the Federal
Government, including an executive agency as de-
fined in section 105 of title 5, United States Code.
(5) The term ‘‘financial assistance’’, with re-
spect to a project of research, means a grant, coop-
erative agreement, or contract.
(6)(A) The term ‘‘indirect cost’’, with respect to
a project of research, means the costs described in
subsection (a)(1), consisting of the 7 categories de-
scribed in subparagraph (B), as such costs (and cat-
egories) are defined in the document issued by the
Director of the Office of Management and Budget
and designated by such Director as OMB Circular
A–21 (or as defined in any document issued by such
Director as a successor to OMB Circular A–21), ex-
cept that such term does not include any cost dis-
allowed for purposes of title 48, Code of Federal
Regulations (relating to the Federal Acquisition
Regulations System).
(B) The categories referred to in subparagraph
(A) are the categories of general administration, de-
partmental administration, administration of the
628
project of research involved (also known as spon-
sored project administration), operations and main-
tenance, student services (in the case of an entity
that is an educational institution), libraries (in the
case of such an entity), and buildings and equip-
ment.
(7) The term ‘‘institution of higher education’’
has the meaning given such term in section 1201(a)
of the Higher Education Act of 1965.
(8) The term ‘‘modified direct costs’’, with re-
spect to a project of research, has the meaning given
such term by the Director of the Office of Manage-
ment and Budget.
(9) The term ‘‘nonadministrative categories’’,
with respect to the indirect costs of a project of re-
search, means the categories of operations and
maintenance, student services (in the case of an en-
tity that is an educational institution), libraries (in
the case of such an entity), and buildings and equip-
ment.
(h) EFFECTIVE DATE.—This section is effective in
the case of awards of financial assistance made for fiscal
year 1996 or any subsequent fiscal year.
629
SEC. 11102. REDUCTION IN BUDGET OF NATIONAL INSTI-
TUTES OF HEALTH.
Title IV of the Public Health Service Act (42 U.S.C.
281 et seq.) is amended by adding at the end the following
part:
‘‘PART J—REDUCTION IN BUDGET OF NATIONAL
INSTITUTES OF HEALTH
‘‘REDUCTION IN BUDGET
‘‘SEC. 499B. (a) 1995 LEVELS LESS SAVINGS RE-
GARDING INDIRECT COST RATES.—Notwithstanding any
other provision of law, the authorizations of appropria-
tions established for carrying out this title for a fiscal year
are effective only to the extent that the authorizations for
the fiscal year do not, in the aggregate, exceed the follow-
ing 
amount, 
as 
applicable 
to 
the 
fiscal 
year:
$10,841,598,000 for fiscal year 1996, $10,475,098,000
for fiscal year 1997, $10,109,598,000 for fiscal year 1998,
$10,071,098,000 
for 
fiscal 
year 
1999, 
and
$10,032,598,000 for fiscal year 2000.
‘‘(b) PRESUMED
PER-PROGRAM
AUTHORIZATION
LEVEL.—For each of the fiscal years specified in sub-
section (a), the authorization of appropriations for each
program under this title is deemed to be an amount equal
to the appropriation made for the program for the preced-
ing fiscal year, unless a provision of this title specifies that
this subsection is not applicable to the program.
630
‘‘(c) PRO RATA REDUCTIONS IN AUTHORIZATIONS.—
If the aggregate of the authorizations of appropriations
established for carrying out this title for a fiscal year (in-
cluding authorizations established under subsection (b))
exceeds the amount applicable under subsection (a) to the
fiscal year, each such authorization is reduced pro rata
by the amount necessary for the aggregate of the author-
izations to equal the applicable amount.’’.
SEC. 11103. REDUCTION IN HEALTH PROFESSIONS BUDGET
OF HEALTH RESOURCES AND SERVICES AD-
MINISTRATION.
Title VII of the Public Health Service Act (42 U.S.C.
292 et seq.) is amended by adding at the end the following
part:
‘‘PART H—REDUCTION IN HEALTH PROFESSIONS
BUDGET
‘‘SEC. 799A. PROGRAMS FOR MINORITY AND DISADVAN-
TAGED STUDENTS AS EXCLUSIVE TITLE VII
PROGRAMS.
‘‘(a) EFFECT
ON OTHER PROGRAMS.—For fiscal
year 1996 or any subsequent fiscal year, the authorization
of appropriations established in subsection (b) for the fis-
cal year is the exclusive authorization of appropriations
for such year under this title, except as provided in sub-
631
section (c). The preceding sentence applies notwithstand-
ing any other provision of law.
‘‘(b) AUTHORIZATIONS
OF APPROPRIATIONS RE-
GARDING MINORITY AND DISADVANTAGED STUDENTS.—
For the purpose of carrying out programs under this title
that are designed to increase the enrollment of minority
and economically disadvantaged students, there are au-
thorized to be appropriated such sums as may be nec-
essary for each of the fiscal years 1996 through 1998.
‘‘(c) EXCEPTION REGARDING FEDERAL RESPON-
SIBILITIES UNDER PROGRAM FOR HEALTH EDUCATION
ASSISTANCE LOANS
TO GRADUATE STUDENTS.—Sub-
section (a) does not apply to the authorization of appro-
priations established in section 720. The preceding sen-
tence does not provide any credit authority for such pro-
gram in addition to that provided in section 702.’’.
SEC. 11104. CLOSURE OF UNIFORMED SERVICES UNIVER-
SITY OF THE HEALTH SCIENCES.
(a) CLOSURE REQUIRED.—Section 2112 of title 10,
United States Code, is amended—
(1) in subsection (c)—
(A) by inserting ‘‘and the closure’’ after
‘‘The development’’; and
632
(B) by striking out ‘‘subsection (a)’’ and
inserting in lieu thereof ‘‘subsections (a) and
(b)’’; and
(2) by striking out subsection (b) and inserting
in lieu thereof the following new subsection:
‘‘(b)(1) Not later than September 30, 1998, the Sec-
retary of Defense shall close the University. To achieve
the closure of the University by that date, the Secretary
shall begin to terminate the operations of the University
beginning in fiscal year 1995. On account of the required
closure of the University under this subsection, no stu-
dents may be admitted to begin studies in the University
after the date of the enactment of this subsection.
‘‘(2) Section 2687 of this title and any other provi-
sion of law establishing preconditions to the closure of any
activity of the Department of Defense shall not apply with
regard to the termination of the operations of the Univer-
sity or to the closure of the University pursuant to this
subsection.’’.
(b) FINAL GRADUATION
OF STUDENTS.—Section
2112(a) of such title is amended—
(1) in the second sentence, by striking out ‘‘,
with the first class graduating not later than Sep-
tember 21, 1982.’’ and inserting in lieu thereof ‘‘,
633
except that no students may be awarded degrees by
the University after September 30, 1998.’’; and
(2) by adding at the end the following new sen-
tence: ‘‘On a case-by-case basis, the Secretary of De-
fense may provide for the continued education of a
person who, immediately before the closure of the
University under subsection (b), was a student in
the University and completed substantially all re-
quirements necessary to graduate from the Univer-
sity.’’.
(c) TERMINATION OF UNIVERSITY BOARD OF RE-
GENTS.—Section 2113 of such title is amended by adding
at the end the following new subsection:
‘‘(k) The Board shall terminate on September 30,
1998, except that the Secretary of Defense may terminate
the Board before that date as part of the termination of
the operations of the University under section 2112(b) of
this title.’’.
(d) PROHIBITION ON RECIPROCAL AGREEMENTS.—
Section 2114(e)(1) of such title is amended by adding at
the end the following new sentence: ‘‘No agreement may
be entered into under this subsection after the date of the
enactment of this sentence, and all such agreements shall
terminate not later than September 30, 1998.’’.
634
(e) CONFORMING AMENDMENTS.—(1) Section 178 of
such title, relating to the Henry M. Jackson Foundation
for the Advancement of Military Medicine, is amended—
(A) in subsection (b), by inserting after ‘‘Uni-
formed Services University of the Health Sciences,’’
the following: ‘‘or after the closure of the University,
with the Department of Defense,’’;
(B) in subsection (c)(1)(B), by striking out
‘‘the Dean of the Uniformed Services University of
the Health Sciences’’ and inserting in lieu thereof ‘‘a
person designated by the Secretary of Defense’’; and
(C) in subsection (g)(1), by inserting after
‘‘Uniformed Services University of the Health
Sciences,’’ the following: ‘‘or after the closure of the
University, the Secretary of Defense’’.
(2) Section 466(a)(1)(B) of the Public Health Service
Act (42 U.S.C. 286a(a)(1)(B)), relating to the Board of
Regents of the National Library of Medicine, is amended
by striking out ‘‘the Dean of the Uniformed Services Uni-
versity of the Health Sciences,’’.
(f) CLERICAL AMENDMENTS.—(1) The heading of
section 2112 of title 10, United States Code, is amended
to read to read as follows:
635
‘‘§ 2112. Establishment and closure of University’’.
(2) The item relating to such section in the table of
sections at the beginning of chapter 104 of such title is
amended to read as follows:
‘‘2112. Establishment and closure of University.’’.
Subtitle C—Medicaid Reforms
SEC. 11201. REDUCTION IN FEDERAL PAYMENTS FOR DIS-
PROPORTIONATE SHARE HOSPITALS.
(a) IN GENERAL.—Section 1923 of the Social Secu-
rity Act (42 U.S.C. 1396r–4) is amended by adding at
the end the following new subsection:
‘‘(h) REDUCTION IN FEDERAL FINANCIAL PARTICI-
PATION
FOR
DISPROPORTIONATE
SHARE
ADJUST-
MENTS.—
‘‘(1) IN GENERAL.—Notwithstanding any other
provision of this section, the amount of payments
under section 1903(a) with respect to any payment
adjustment made under this section for hospitals in
a State for quarters in a fiscal year shall not exceed
the applicable percentage of the amount otherwise
determined under subsection (f)
‘‘(2) APPLICABLE PERCENTAGE DEFINED.—In
paragraph (1), the applicable percentage for a fiscal
year is as follows:
‘‘(A) For fiscal year 1995, 80 percent.
‘‘(B) For fiscal year 1996, 70 percent.
636
‘‘(C) For fiscal year 1997, 55 percent.
‘‘(D) For fiscal year 1998, 40 percent.’’.
(b) CONFORMING AMENDMENT.—Section 1923(c) of
such Act (42 U.S.C. 1396r–4(c)) is amended in the matter
preceding paragraph (1) by striking ‘‘(f) and (g)’’ and in-
serting ‘‘(f), (g), and (h)’’.
SEC. 11202. IMPOSITION OF STATE LIMITS ON APPROVED
NURSING FACILITY BEDS.
(a) STATE PLAN REQUIREMENT.—Section 1902(a)
of the Social Security Act (42 U.S.C. 1396a(a)) is amend-
ed—
(1) by striking ‘‘and’’ at the end of paragraph
(61);
(2) by striking the period at the end of para-
graph (62) and inserting ‘‘; and’’; and
(3) by inserting after paragraph (62) the fol-
lowing new paragraph:
‘‘(63) provide that the State agency shall pro-
vide assurances satisfactory to the Secretary that
the State has in effect laws prohibiting a nursing fa-
cility from opening additional beds without a certifi-
cate of need issued by the State in accordance with
guidelines established by the State and approved by
the Secretary based on the ratio of nursing facility
637
beds to the number of individuals residing in the ap-
plicable area who are likely to use such beds.’’.
(b) EFFECTIVE DATE.—(1) Except as provided in
paragraph (2), the amendments made by subsection (a)
shall apply to calendar quarters beginning on or after Oc-
tober 1, 1995, without regard to whether or not final regu-
lations to carry out such amendments have been promul-
gated by such date.
(2) In the case of a State plan for medical assistance
under title XIX of the Social Security Act which the Sec-
retary of Health and Human Services determines requires
State legislation (other than legislation appropriating
funds) in order for the plan to meet the additional require-
ments imposed by the amendments made by subsection
(a), the State plan shall not be regarded as failing to com-
ply with the requirements of such title solely on the basis
of its failure to meet these additional requirements before
the first day of the first calendar quarter beginning after
the close of the first regular session of the State legisla-
ture that begins after the date of the enactment of this
Act. For purposes of the previous sentence, in the case
of a State that has a 2-year legislative session, each year
of such session shall be deemed to be a separate regular
session of the State legislature.
638
SEC. 11203. REDUCING TO 50 PERCENT THE MATCHING
RATE FOR ADMINISTRATIVE COSTS UNDER
THE MEDICAID PROGRAM.
(a) IN GENERAL.—Section 1903(a) of the Social Se-
curity Act (42 U.S.C. 1396b(a)) is amended to read as
follows:
‘‘(a) From the sums appropriated therefore, the Sec-
retary (except as otherwise provided in this section) shall
pay to each State that has a plan approved under this
title, for each quarter—
‘‘(1) an amount with respect to total expendi-
tures during such quarter under the State plan for
medical assistance (as defined in section 1905(a))
equal to the sum of—
‘‘(A) an amount equal to 90 percent of
such expenditures for family planning services
and supplies, plus
‘‘(B) an amount equal to the Federal med-
ical assistance percentage (as defined in section
1905(b), subject to subsections (g) and (j) of
this section), of the remainder of such expendi-
tures; plus
‘‘(2) subject to section 1919(g)(3)(C), an
amount equal to 45 percent of the remainder of the
expenditures during such quarter as found necessary
639
by the Secretary for the proper and efficient admin-
istration of the State plan.’’.
(b) CONFORMING AMENDMENTS.—
(1) FRAUD CONTROL UNITS.—Section 1903(b)
of such Act (42 U.S.C. 1396b(b)) is amended by
striking paragraph (3).
(2) MEDICAID
MANAGEMENT
INFORMATION
SYSTEMS.—Section 1903(r) of such Act (42 U.S.C.
1396b(r)) is amended—
(A) by amending paragraph (1) to read as
follows:
‘‘(1) In order to receive payments under subsection
(a)(2) without being subject to per centum reductions set
forth in paragraph (2), a State must have in operation
mechanized claims processing and information retrieval
systems approved by the Secretary (of the type approved
since October 7, 1980) which are determined to be likely
to provide more efficient, economical, and effective admin-
istration of the plan and which—
‘‘(A) are compatible with the claims processing
and information retrieval systems used in the admin-
istration of title XVIII, and
‘‘(B) include provision for prompt written notice
to each individual who is furnished services covered
by the plan, or to each individual in a sample group
640
of such individuals, of the specific services (other
than confidential services) so covered, the name of
the person or persons furnishing the services, the
date or dates on which the services were furnished,
and the amount of the payment or payments made
under the plan on account of the services.’’;
(B) by striking paragraphs (2) and (3),
and redesignating paragraphs (4) through (8)
as paragraphs (2) through (6), respectively;
(C) in paragraph (2), as so redesignated—
(i) in subparagraph (A), by striking
‘‘paragraph (6)’’ and inserting ‘‘paragraph
(4)’’, and
(ii) in subparagraph (B)—
(I) 
by 
striking 
‘‘subsection
(a)(3)(B)’’ and inserting ‘‘subsection
(a)(2)’’; and
(II) by striking ‘‘not less than 50
per centum and not more than 70 per
centum’’ and inserting ‘‘not less than
25 per centum and not more than 45
per centum’’;
(D) in paragraph (3), as so redesignated—
(i) in the matter in subparagraph (A)
preceding clause (i), by striking ‘‘sub-
641
section (a)(3)(B)’’ and inserting ‘‘para-
graph (1)’’, and
(ii) in subparagraphs (A)(iii) and (B),
by striking ‘‘paragraph (6)’’ and inserting
‘‘paragraph (4)’’; and
(E) in paragraph (4), as so redesignated—
(i) by striking subparagraph (C) and
redesignating subparagraphs (D) through
(J) as subparagraphs (C) through (I), and
(ii) in subparagraph (H), as redesig-
nated, by striking ‘‘subsection (a)(3) of
this section’’ and inserting ‘‘subsection
(a)(2)’’.
(3) NURSING
HOME
ENFORCEMENT.—Section
1919 of such Act (42 U.S.C. 1396r) is amended—
(A) in subsection (g)(3)(C), by striking
‘‘section 1903(a)(2)(D)’’ and inserting ‘‘section
1903(a)(2) with respect to amounts expended
for State activities under this subsection’’, and
(B) in subsection (h)(2), by striking
‘‘1903(a)(7)’’ and inserting ‘‘1903(a)(2)’’ each
place it appears in subparagraphs (E) and (F).
(4) PEER REVIEW FUNDING.—Section 1158 of
such Act (42 U.S.C. 1320c–7) is amended—
(A) by striking ‘‘(a)’’, and
642
(B) by striking subsection (b).
(c) EFFECTIVE DATE.—The amendments made by
this section shall apply to quarters beginning on or after
October 1, 1995.
Subtitle D—Reforms in Health
Care Block Grants
SEC. 11301. CONSOLIDATION OF CERTAIN BLOCK GRANTS.
(a) IN GENERAL.—Title XIX of the Public Health
Service Act (42 U.S.C. 300w et seq.) is amended by add-
ing at the end the following part:
‘‘PART C—CONSOLIDATION OF HEALTH-RELATED
BLOCK GRANTS
‘‘SEC. 
1981. 
CONSOLIDATED 
PROGRAM 
OF 
FORMULA
GRANTS.
‘‘In the case of each State that in accordance with
section 1983 submits to the Secretary an application for
fiscal year 1996 or any subsequent fiscal year, the Sec-
retary shall make a grant for the year to the State for
the purposes specified in section 1982. The grant shall
consist of the allotment determined for the State under
section 1984.
‘‘SEC. 1982. PURPOSES OF GRANTS; EFFECT ON SEPARATE
PROGRAMS.
‘‘(a) IN GENERAL.—The Secretary may make a grant
under section 1981 only if the State involved agrees that
643
the grant will be expended only for the purposes author-
ized in any of the following programs (as in effect for fis-
cal year 1995):
‘‘(1) The program under part A of this title (re-
lating to block grants for preventive health and
health services).
‘‘(2) The program under subpart 1 of part B
of this title (relating to block grants for community
mental health services).
‘‘(3) The program under subpart 2 of part B
of this title (relating to block grants for the preven-
tion and treatment of substance abuse).
‘‘(4) The program under title V of the Social
Security Act (relating to block grants for maternal
and child health services).
‘‘(b) EFFECT ON SEPARATE PROGRAMS.—For fiscal
year 1996 and subsequent fiscal years:
‘‘(1) No amounts are authorized to be appro-
priated under any of the programs specified in sub-
section (a), notwithstanding any other provision of
law.
‘‘(2) The programs are in effect only to the ex-
tent provided in subsection (a).
644
‘‘(c) RULE
OF CONSTRUCTION.—With respect to
compliance with the agreement made by a State under
subsection (a):
‘‘(1) The State may expend a grant under sec-
tion 1981 for any or all of the purposes authorized
in the four programs specified in such subsection.
‘‘(2) The State is not required to expend the
grant for each of the four categories of services or
activities with which the four programs were, respec-
tively, concerned.
‘‘SEC. 1983. APPLICATION FOR GRANT.
‘‘The Secretary may make a grant under section
1981 only if an application for the grant is submitted to
the Secretary by the date specified by the Secretary, and
the application is in such form, is made in such manner,
and contains such agreements, assurances, and informa-
tion as the Secretary determines to be necessary to carry
out this part.
‘‘SEC. 1984. AMOUNT OF ALLOTMENT.
‘‘(a) IN GENERAL.—
‘‘(1) ALLOTMENT.—For purposes of section
1981—
‘‘(A) the allotment determined under this
section for a State for a fiscal year is, subject
to subsection (g), the sum of the respective
645
amounts determined for the State under sub-
sections (b) through (e); and
‘‘(B) the allotment determined under this
section for a territory for a fiscal year is the
amount determined under subsection (h).
‘‘(2) APPLICABILITY
TO
TERRITORIES.—For
purposes of this part, the term ‘State’ means each
of the several States and each of the territories, ex-
cept that, for purposes of paragraph (1) and sub-
sections (b) through (g), such term does not include
any territory.
‘‘(b) AMOUNT RELATING TO FORMULAS IN PROGRAM
FOR PREVENTIVE HEALTH AND HEALTH SERVICES.—
For purposes of subsection (a)(1)(A), the amount under
this subsection for a State for a fiscal year shall be deter-
mined as follows:
‘‘(1) The Secretary shall determine an amount
equal to 6.7 percent of the amount that is appro-
priated under section 1986 for the fiscal year and
available after compliance with section 1986(b).
‘‘(2) Of the amount determined under para-
graph (1), 97.2 percent shall be applied to the for-
mula in effect under subsection (a) of section 1902
for fiscal year 1995.
646
‘‘(3) Of the amount determined under para-
graph (1), 2.8 percent shall be applied to the for-
mula in effect under subsection (b) of section 1902
for fiscal year 1995.
‘‘(4) The amount determined under this sub-
section for the fiscal year is the sum of the amount
resulting under paragraph (2) and the amount re-
sulting under paragraph (3).
‘‘(c) AMOUNT RELATING TO FORMULA IN PROGRAM
FOR COMMUNITY MENTAL HEALTH SERVICES.—For pur-
poses of subsection (a)(1)(A), the amount under this sub-
section for a State for a fiscal year shall be determined
as follows:
‘‘(1) The Secretary shall determine an amount
equal to 11.7 percent of the amount that is appro-
priated under section 1986 for the fiscal year and
available after compliance with section 1986(b).
‘‘(2) The amount determined under paragraph
(1) shall be applied to the formula in effect under
subsection (a) of section 1918 for fiscal year 1995,
and after application of the formula shall be ad-
justed to the extent required by subsection (b) of
such section (as in effect for fiscal year 1995).
647
‘‘(3) The amount determined under this sub-
section for the fiscal year is the amount resulting
under paragraph (2).
‘‘(d) AMOUNT RELATING TO FORMULA IN PROGRAM
FOR
PREVENTION
AND
TREATMENT
OF
SUBSTANCE
ABUSE.—For purposes of subsection (a)(1)(A), the
amount under this subsection for a State for a fiscal year
shall be determined as follows:
‘‘(1) The Secretary shall determine an amount
equal to 52.5 percent of the amount that is appro-
priated under section 1986 for the fiscal year and
available after compliance with section 1986(b).
‘‘(2) The amount determined under paragraph
(1) shall be applied to the formula in effect under
subsection (a) of section 1933 for fiscal year 1995,
and after application of the formula shall be ad-
justed to the extent required by subsection (b) of
such section (as in effect for fiscal year 1995).
‘‘(3) The amount determined under this sub-
section for the fiscal year is the amount resulting
under paragraph (2).
‘‘(e) AMOUNT RELATING TO FORMULA IN PROGRAM
FOR MATERNAL AND CHILD HEALTH SERVICES.—For
purposes of subsection (a)(1)(A), the amount under this
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subsection for a State for a fiscal year shall be determined
as follows:
‘‘(1) The Secretary shall determine an amount
equal to 29.1 percent of the amount that is appro-
priated under section 1986 for the fiscal year and
available after compliance with section 1986(b).
‘‘(2) The amount determined under paragraph
(1) shall be applied to the formula in effect under
section 502(c)(2) of the Social Security Act for fiscal
year 1995.
‘‘(3) The amount determined under this sub-
section for the fiscal year is the amount resulting
under paragraph (2).
‘‘(f) RULES OF CONSTRUCTION.—For purposes of
subsections (b) through (e):
‘‘(1) In applying an amount to a formula, the
amount shall be used in the formula in lieu of the
funds that otherwise would be allocated by the for-
mula.
‘‘(2) With respect to the data to be used in the
formula, the Secretary shall use the most recent
data that is reasonably available to the Secretary
(subject to any restrictions in the formula).
‘‘(g) FUNDS FOR TRIBES AND TRIBAL ORGANIZA-
TIONS.—
649
‘‘(1) IN GENERAL.—From the allotment deter-
mined for a State for a fiscal year pursuant to sub-
section (a)(1)(A), the Secretary shall reserve an
amount determined in accordance with paragraph
(4) if the Secretary—
‘‘(A) receives a request from the governing
body of an Indian tribe or tribal organization
within the State that funds under this part be
provided directly by the Secretary to such tribe
or organization; and
‘‘(B) makes a determination that the mem-
bers of such tribe or tribal organization would
be better served by means of grants made di-
rectly by the Secretary under this.
‘‘(2) TRIBE
OR
TRIBAL
ORGANIZATION
AS
GRANTEE.—The amount reserved by the Secretary
on the basis of a determination under paragraph (1)
shall, subject to paragraph (3), be granted to the In-
dian tribe or tribal organization serving the individ-
uals for whom such a determination has been made.
‘‘(3) REQUIRED
PLAN.—The Secretary may
make a grant under this subsection for a fiscal year
only if the Indian tribe or tribal organization in-
volved submits to the Secretary a plan for the fiscal
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year that meets such criteria as the Secretary may
prescribe.
‘‘(4) AMOUNT
OF
GRANT.—For purposes of
paragraph (1), the amount reserved under this para-
graph for a fiscal year for an Indian tribe or tribal
organization shall be determined as follows:
‘‘(A) The Secretary shall determine an
amount equal to the difference between—
‘‘(i) the allotment made pursuant to
subsection (a)(1)(A) for the fiscal year for
the State involved; and
‘‘(ii) the amount determined for the
State under subsection (e) for the fiscal
year.
‘‘(B) The amount reserved under this
paragraph for the fiscal year is the product
of—
‘‘(i) the amount determined under
subparagraph (A); and
‘‘(ii) a percentage equal to the ratio
of—
‘‘(I) the aggregate amount re-
ceived by the Indian tribe or tribal or-
ganization for fiscal year 1995 under
parts A and B; over
651
‘‘(II) the aggregate amounts re-
ceived by the State involved under
such parts for fiscal year 1995.
‘‘(5) DEFINITION.—The terms ‘Indian tribe’
and ‘tribal organization’ have the same meaning
given such terms in subsections (b) and (c) of sec-
tion 4 of the Indian Self-Determination and Edu-
cation Assistance Act.
‘‘(h) ALLOTMENTS
FOR TERRITORIES.—For pur-
poses of section 1981, the allotment under this section for
a territory for a fiscal year shall be made from amounts
reserved under section 1986(b), and the amount of the
allotment shall be determined in a manner equivalent to
the manner in which an allotment for a State is deter-
mined pursuant to subsection (a)(1)(A).
‘‘(i) DISPOSITION OF CERTAIN FUNDS.—
‘‘(1) IN GENERAL.—Of the amounts available
for a fiscal year for grants under section 1981,
amounts described in paragraph (2), if any, shall be
allotted by the Secretary as grants to States that
submit applications in accordance with section 1983
for the fiscal year. The amount of such a grant for
a State shall be determined in a manner equivalent
to the manner in which the amount of a grant was
otherwise determined under this section for the
652
State for the fiscal year, and the grant shall be sub-
ject to the same conditions as grants under section
1981.
‘‘(2) 
SPECIFICATION
OF
AMOUNTS.—The
amounts referred to in paragraph (1) for a fiscal
year are any amounts that are not paid under sec-
tion 1981 to the States for the fiscal year as a result
of—
‘‘(A) the failure of one or more States to
submit an application in accordance with sec-
tion 1983 for the fiscal year; or
‘‘(B) one or more States informing the
Secretary that the State does not intend to ex-
pend the full amount of the grant made to the
State under section 1981 for the fiscal year.
‘‘SEC. 1985. DEFINITIONS.
‘‘For purposes of this part:
‘‘(1) The term ‘State’ has the meaning given
such term in section 1984(a)(2).
‘‘(2) The term ‘territory’ means each of the
Commonwealth of Puerto Rico, American Samoa,
Guam, the Commonwealth of the Northern Mariana
Islands, the Virgin Islands, Palau, the Marshall Is-
lands, and Micronesia.
653
‘‘SEC. 1986. AUTHORIZATION OF APPROPRIATIONS.
‘‘(a) IN GENERAL.—For the purpose of carrying out
this part, there are authorized to be appropriated
$2,233,833,800 for fiscal year 1996, and $2,122,142,111
for fiscal year 1997 and each of the fiscal years 1998
through 2000.
‘‘(b) ALLOCATION.—Of the amounts appropriated
under subsection (a) for a fiscal year, the Secretary shall
make available for grants under section 1981 to the terri-
tories an amount equal to the product of—
‘‘(1) the amounts so appropriated; and
‘‘(2) a percentage equal to the ratio of—
‘‘(A) the aggregate amounts received by
the territories for fiscal year 1995 under parts
A and B and under title V of the Social Secu-
rity Act; and
‘‘(B) the aggregate amounts appropriated
for fiscal year 1995 under sections 1901, 1920,
and 1935 and under section 501 of the Social
Security Act.’’.
(b) CONFORMING AMENDMENTS.—
(1) PROGRAM FOR PREVENTIVE HEALTH AND
HEALTH
SERVICES.—Section 1901 of the Public
Health Service Act (42 U.S.C. 300w) is amended—
(A) in subsection (a), by striking ‘‘through
1997’’ and inserting ‘‘and 1995’’; and
654
(B) by adding at the end the following sub-
section:
‘‘(c) For fiscal year 1996 and subsequent fiscal years,
this part is subject to part C.’’.
(2) PROGRAM FOR COMMUNITY HEALTH SERV-
ICES.—Section 1920 of the Public Health Service
Act (42 U.S.C. 300x–9) is amended by adding at
the end the following subsection:
‘‘(c) LIMITATION.—For fiscal year 1996 and subse-
quent fiscal years, this subpart is subject to part C.’’.
(3) PROGRAM FOR PREVENTION AND TREAT-
MENT OF SUBSTANCE ABUSE.—Section 1935 of the
Public Health Service Act (42 U.S.C. 300x–35) is
amended by adding at the end the following sub-
section:
‘‘(c) LIMITATION.—For fiscal year 1996 and subse-
quent fiscal years, this subpart is subject to part C.’’.
(4) PROGRAM
FOR
MATERNAL
AND
CHILD
HEALTH SERVICES.—Section 501 of the Social Secu-
rity Act (42 U.S.C. 701) is amended—
(A) in subsection (a), in the matter preced-
ing paragraph (1), by striking ‘‘each fiscal year
thereafter’’ and inserting ‘‘each of the fiscal
years 1991 through 1995’’; and
655
(B) by adding at the end the following sub-
section:
‘‘(c) For fiscal year 1996 and subsequent fiscal years,
this part is subject to part C of title XIX of the Public
Health Service Act (relating to the consolidation of certain
programs).’’.
SEC. 11302. REDUCTION IN BUDGET FOR IMMUNIZATION
PROGRAMS; 
PROHIBITION 
REGARDING
WAREHOUSING OF VACCINES.
Section 317(j) of the Public Health Service Act (42
U.S.C. 247b(j)) is amended—
(1) in paragraph (1), in the first sentence—
(A) by striking ‘‘and’’ after ‘‘1991,’’; and
(B) by inserting before the period the fol-
lowing: ‘‘, $328,591,000 for fiscal year 1996,
$324,591,000 
for 
fiscal 
year 
1997,
$319,591,000 
for 
fiscal 
year 
1998,
$315,591,000 
for 
fiscal 
year 
1999, 
and
$310,591,000 for fiscal year 2000’’;
(2) by striking paragraph (2); and
(3) by adding at the end the following para-
graph:
‘‘(2) In carrying out programs of the Department of
Health and Human Services under which the Secretary
provides for the storage of vaccines, the Secretary may
656
not provide for the storage of all (or substantially all) of
the vaccines in a single storage facility.’’.
Subtitle E—Health Care Program
Reforms
SEC. 11401. REDUCTION IN BUDGET OF AGENCY FOR
HEALTH CARE POLICY AND RESEARCH.
Section 926 of the Public Health Service Act (42
U.S.C. 299c–5) is amended by adding at the end the fol-
lowing subsection:
‘‘(f) TERMINATION OF FUNDING FOR AGENCY.—For
fiscal year 1996 and each subsequent fiscal year, this Act
does not provide any authorization of appropriations to
carry out this title.’’.
SEC. 11402. REDUCTION IN BUDGET FOR PROGRAMS TO
TREAT SUBSTANCE ABUSE.
Subpart 1 of part B of title V of the Public Health
Service Act (42 U.S.C. 290bb et seq.) is amended by add-
ing at the end the following section:
‘‘REDUCTION IN TREATMENT BUDGET
‘‘SEC. 514. (a) IN GENERAL.—Notwithstanding any
other provision of law, the authorizations of appropria-
tions established for carrying out this subpart and section
1971 for a fiscal year are effective only to the extent that
the authorizations for the fiscal year do not, in the aggre-
gate, exceed the following amount, as applicable to the fis-
cal year: $178,405,000 for fiscal year 1996, $170,405,000
657
for fiscal year 1997, $163,405,000 for fiscal year 1998,
$155,405,000 for fiscal year 1999, and $148,405,000 for
fiscal year 2000.
‘‘(b) PRESUMED
PER-PROGRAM
AUTHORIZATION
LEVEL.—For each of the fiscal years specified in sub-
section (a), the authorization of appropriations for each
program under this subpart and section 1971 is deemed
to be an amount equal to the appropriation made for the
program for the preceding fiscal year, unless a provision
of this subpart or section 1971 specifies that this sub-
section is not applicable to the program.
‘‘(c) PRO RATA REDUCTIONS IN AUTHORIZATIONS.—
If the aggregate of the authorizations of appropriations
established for carrying out this subpart and section 1971
for a fiscal year (including authorizations established
under subsection (b)) exceeds the amount applicable under
subsection (a) to the fiscal year, each such authorization
is reduced pro rata by the amount necessary for the aggre-
gate of the authorizations to equal the applicable
amount.’’.
SEC. 11403. ABOLITION OF OFFICE OF THE SURGEON GEN-
ERAL OF THE PUBLIC HEALTH SERVICE
With respect to the Office of the Surgeon General
of the Public Service—
658
(1) all authorities and personnel of the Office
are transferred to the Assistant Secretary for Health
of the Department of Health and Human Services;
(2) all unobligated portions of budget authority
allocated for the Office are rescinded; and
(3) the Office, and the position of such Surgeon
General, are terminated.
Subtitle F—Federal Employee
Health Care Reform
SEC. 11501. GOVERNMENT CONTRIBUTION TO THE FED-
ERAL EMPLOYEES HEALTH BENEFITS PRO-
GRAM.
(a) IN GENERAL.—Section 8906 of title 5, United
States Code, is amended by striking subsections (a) and
(b) and inserting the following:
‘‘(a) For the purpose of this section, ‘base quarter’
and ‘price index’ each has the meaning given it by section
8340.
‘‘(b)(1)(A) Except as otherwise provided in this sub-
section, the biweekly Government contribution for health
benefits for an employee or annuitant enrolled in a health
benefits plan under this chapter shall be—
‘‘(i) $1,535, if enrollment is for self alone, and
‘‘(ii) $3,430, if enrollment is for self and family,
as adjusted under subparagraph (B).
659
‘‘(B) The biweekly Government contribution under
this paragraph for contract year 1997, or a subsequent
contract year, is the applicable amount under subpara-
graph (A), increased by the percentage (if any) by which—
‘‘(i) the price index for the base quarter of the
preceding contract year, exceeds
‘‘(ii) the price index for the base quarter of con-
tract year 1994,
rounded to the nearest multiple of $5 (or, if midway be-
tween multiples of $5, to the next higher multiple of $5).
For an employee, the adjustment begins on the first day
of the employee’s first pay period of the contract year.
For an annuitant, the adjustment begins on the first day
of the first period of the contract year for which an annu-
ity payment is made.
‘‘(2) The biweekly Government contribution for an
employee or annuitant enrolled in a plan under this chap-
ter shall not exceed the subscription charge.
‘‘(3) In the case of an employee occupying a position
on a part-time career employment basis (as defined in sec-
tion 3401(2)), the biweekly Government contribution shall
be equal to the amount which bears the same ratio to the
otherwise applicable amount under this subsection (deter-
mined without regard to this paragraph) as the average
number of hours of such employee’s regularly scheduled
666
‘‘(A) except as otherwise provided in this para-
graph, $70,000,
‘‘(B) $90,000 in the case of an individual who
files a joint return under section 6013 of the Inter-
nal Revenue Code of 1986, and
‘‘(C) zero in the case of an individual who—
‘‘(i) is married at the close of the taxable
year (as determined under section 7703 of the
Internal Revenue Code of 1986) but does not
file a joint return for such year, and
‘‘(ii) does not live apart from the individ-
ual’s spouse at all times during the taxable
year.’’.
(2) 
CONFORMING
AMENDMENT.—Section
1839(f) of such Act (42 U.S.C. 1395r(f)) is amend-
ed by striking ‘‘if an individual’’ and inserting the
following: ‘‘if an individual (other than an individual
subject to an increase in the monthly premium
under this section pursuant to subsection (h))’’.
(3) EFFECTIVE DATE.—The amendments made
by paragraphs (1) and (2) shall apply to the month-
ly premium under section 1839 of the Social Secu-
rity Act for months beginning after February 1996
in taxable years beginning after December 31, 1995.
750
been used in violation of this part, then the
Secretary shall reduce the amount of the grant
otherwise payable to the State under this sec-
tion for the immediately succeeding fiscal year
by the amount so used.
‘‘(B) LIMITATION
ON
AMOUNT
OF
PEN-
ALTY.—In carrying out subparagraph (A), the
Secretary shall not reduce any quarterly pay-
ment by more than 25 percent.
‘‘(C) CARRYFORWARD
OF
UNRECOVERED
PENALTIES.—To the extent that subparagraph
(B) prevents the Secretary from recovering dur-
ing a fiscal year the full amount of a penalty
imposed on a State under subparagraph (A) for
a prior fiscal year, the Secretary shall apply
subparagraph (A) to the grant otherwise pay-
able to the State under this section for the im-
mediately succeeding fiscal year.
‘‘(2) FOR FAILURE TO SUBMIT REQUIRED RE-
PORT.—
‘‘(A) IN GENERAL.—If the Secretary deter-
mines that a State has not, within 6 months
after the end of a fiscal year, submitted the re-
port required by section 406 for the fiscal year,
the Secretary shall reduce by 3 percent the
751
amount of the grant that would (in the absence
of this subsection, subsection (a)(1)(B) of this
section, and section 404(c)(2)) be payable to
the State under subsection (a)(1)(A) for the im-
mediately succeeding fiscal year.
‘‘(B) RESCISSION OF PENALTY.—The Sec-
retary shall rescind a penalty imposed on a
State under subparagraph (A) with respect to a
report for a fiscal year if the State submits the
report before the end of the immediately suc-
ceeding fiscal year.
‘‘(3) FOR FAILURE TO PARTICIPATE IN THE IN-
COME AND ELIGIBILITY VERIFICATION SYSTEM.—If
the Secretary determines that a State program fund-
ed under this part is not participating during a fis-
cal year in the income and eligibility verification sys-
tem required by section 1137, the Secretary shall re-
duce by 1 percent the amount of the grant that
would (in the absence of this subsection, subsection
(a)(1)(B) of this section, and section 404(c)(2)) be
payable to the State under subsection (a)(1)(A) for
the fiscal year.
‘‘(f) LIMITATION
ON FEDERAL AUTHORITY.—The
Secretary may not regulate the conduct of States under