I
105TH CONGRESS
2D SESSION
H. R. 4271
To amend the Community Services Block Grant Act to reauthorize and
make improvements to that Act.
IN THE HOUSE OF REPRESENTATIVES
JULY 17, 1998
Mr. RIGGS (for himself, Mr. GOODLING, Mr. BARRETT of Nebraska, Mr.
GREENWOOD, and Mr. PETERSON of Pennsylvania) introduced the follow-
ing bill; which was referred to the Committee on Education and the
Workforce
A BILL
To amend the Community Services Block Grant Act to
reauthorize and make improvements to that Act.
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 ‘‘Community Services
Authorization Act of 1998’’.
SEC. 2. REAUTHORIZATION.
Sections 671 through 680 of the Community Services
Block Grant Act (42 U.S.C. 9901–9909) are amended to
read as follows:
‘‘Subtitle B—Community Services
Block Grant Program
‘‘SEC. 671. SHORT TITLE.
‘‘This subtitle may be cited as the ‘Community Serv-
ices Block Grant Act’.
‘‘SEC. 672. PURPOSES AND GOALS.
‘‘The purpose of this subtitle is to provide assistance
to States and local communities, working through a net-
work of community action agencies and other neighbor-
hood-based organizations, for the reduction of poverty, the
revitalization of low-income communities, and the em-
powerment of low-income families and individuals in rural
and urban areas to become fully self-sufficient (particu-
larly families who are attempting to transition off a State
program carried out under part A of title IV of the Social
Security Act (42 U.S.C. 601 et seq.)). Such goals may
be accomplished through—
‘‘(1) the strengthening of community capabili-
ties for planning, coordinating, and utilizing a broad
range of Federal, State, local, and private resources
for the elimination of poverty, and for helping indi-
viduals and families achieve self-sufficiency;
‘‘(2) greater use of innovative and effective,
community-based approaches to attacking the causes
and effects of poverty and of community breakdown;
‘‘(3) the maximum participation of residents of
the low-income communities and members of the
groups served by programs assisted through the
block grant to empower such individuals to respond
to the unique problems and needs within their com-
munities; and
‘‘(4) the broadening of the resource base of pro-
grams directed to the elimination of poverty so as to
secure a more active role for private, faith-based,
charitable, and neighborhood organizations in the
provision of services as well as individual citizens,
business, labor, and professional groups who are able
to influence the quantity and quality of opportunities
and services for the poor.
‘‘SEC. 673. DEFINITIONS.
‘‘In this subtitle:
‘‘(1) ELIGIBLE ENTITY.—The term ‘eligible en-
tity’ means an entity—
‘‘(A) that is an eligible entity described in
section 673(1) (as in effect on the day before
the date of enactment of the Human Services
Reauthorization Act of 1998) as of such date of
enactment or is designated by the process de-
scribed in section 676A (including an organiza-
tion serving migrant or seasonal farmworkers
that is so described or designated); and
‘‘(B) that has a tripartite board or other
mechanism described in subsection (a) or (b),
as appropriate, of section 676B.
‘‘(2) POVERTY LINE.—The term ‘poverty line’
means the official poverty line defined by the Office
of Management and Budget based on the most re-
cent data available from the Bureau of the Census.
The Secretary shall revise the poverty line annually
(or at any shorter interval the Secretary determines
to be feasible and desirable) which shall be used as
a criterion of eligibility in the community services
block grant program established under this subtitle.
The required revision shall be accomplished by mul-
tiplying the official poverty line by the percentage
change in the Consumer Price Index for All Urban
Consumers during the annual or other interval im-
mediately preceding the time at which the revision is
made. Whenever a State determines that it serves
the objectives of the block grant program established
under this subtitle, the State may revise the poverty
line to not to exceed 125 percent of the official pov-
erty line otherwise applicable under this paragraph.
‘‘(3) PRIVATE, NONPROFIT
ORGANIZATION.—
The term ‘private, nonprofit organization’ includes a
faith-based organization, to which the provisions of
section 679 shall apply.
‘‘(4) SECRETARY.—The term ‘Secretary’ means
the Secretary of Health and Human Services.
‘‘(5) STATE.—The term ‘State’ means each of
the several States, the District of Columbia, the
Commonwealth of Puerto Rico, Guam, the United
States Virgin Islands, American Samoa, and the
Commonwealth of the Northern Mariana Islands.
‘‘SEC. 674. AUTHORIZATION OF APPROPRIATIONS.
‘‘(a) IN GENERAL.—There are authorized to be ap-
propriated $535,000,000 for fiscal year 1999 and such
sums as may be necessary for each of fiscal years 2000
through 2003 to carry out the provisions of this subtitle
(other than section 681).
‘‘(b) RESERVATIONS.—Of the amounts appropriated
under subsection (a) for each fiscal year, the Secretary
shall reserve—
‘‘(1) 1⁄2 of 1 percent for carrying out section
675A (relating to payments for territories);
‘‘(2) not less than 1⁄2 of 1 percent and not more
than 1 percent for activities authorized in section
678A (relating to training and technical assistance);
and
‘‘(3) not more than 9 percent for carrying out
section 680 (relating to discretionary activities).
‘‘SEC. 675. ESTABLISHMENT OF BLOCK GRANT PROGRAM.
‘‘The Secretary is authorized to establish a commu-
nity services block grant program and make grants
through the program to States to ameliorate the causes
of poverty in communities within the States.
‘‘SEC. 675A. DISTRIBUTION TO TERRITORIES.
‘‘(a) APPORTIONMENT.—The Secretary shall appor-
tion the amount reserved under section 674(b)(1) for each
fiscal year on the basis of need among Guam, American
Samoa, the United States Virgin Islands, and the Com-
monwealth of the Northern Mariana Islands.
‘‘(b) APPLICATION.—Each jurisdiction to which sub-
section (a) applies may receive a grant under this subtitle
for the amount apportioned under subsection (a) on sub-
mitting to the Secretary, and obtaining approval of, an
application containing provisions that describe the pro-
grams for which assistance is sought under this subtitle,
and that are consistent with the requirements of section
676.
‘‘SEC. 675B. ALLOTMENTS AND PAYMENTS TO STATES.
‘‘(a) ALLOTMENTS
IN GENERAL.—The Secretary
shall, from the amount appropriated under section 674(a)
for each fiscal year that remains after the Secretary makes
the reservations required in section 674(b), allot to each
State an amount that bears the same ratio to such remain-
ing amount as the amount received by the State for fiscal
year 1981 under section 221 of the Economic Opportunity
Act of 1964 bore to the total amount received by all States
for fiscal year 1981 under such section, except that no
State shall receive less than 1⁄4 of 1 percent of the amount
appropriated under section 674(a) for such fiscal year.
‘‘(b) ALLOTMENTS IN YEARS WITH GREATER AVAIL-
ABLE FUNDS.—
‘‘(1) MINIMUM ALLOTMENTS.—Subject to para-
graphs (2) and (3), if the amount appropriated
under section 674(a) for each fiscal year that re-
mains after the Secretary makes the reservations re-
quired in section 674(b) exceeds $345,000,000, the
Secretary shall allot to each State not less than 1⁄2
of 1 percent of the amount appropriated under sec-
tion 674(a) for such fiscal year.
‘‘(2) MAINTENANCE
OF
1990
LEVELS.—Para-
graph (1) shall not apply with respect to a fiscal
year if the amount allotted under subsection (a) to
any State for that year is less than the amount al-
lotted under section 674(a)(1) to such State for fis-
cal year 1990.
‘‘(3) MAXIMUM ALLOTMENTS.—The amount al-
lotted under paragraph (1) to a State shall be re-
duced, if necessary, so that the aggregate amount al-
lotted to such State under such paragraph and sub-
section (a) does not exceed 140 percent of the aggre-
gate amount allotted to such State under the cor-
responding provisions of this subtitle for the fiscal
year preceding the fiscal year for which a determina-
tion is made under this subsection.
‘‘(c) ALLOTMENT
OF ADDITIONAL FUNDS.—Not-
withstanding subsections (a) and (b), in any fiscal year
in which the amount appropriated under section 674(a)
exceeds the amount appropriated under such section for
fiscal year 1999, such excess shall be allotted among the
States proportionately based on—
‘‘(1) the number of public assistance recipients
in the respective States;
‘‘(2) the number of unemployed individuals in
the respective States; and
‘‘(3) the number of individuals with incomes
below the poverty line in the respective States.
‘‘(d) PAYMENTS.—The Secretary shall make grants
to eligible States for the allotments made under this sec-
tion. The Secretary shall make payments for the grants
in accordance with section 6503(a) of title 31, United
States Code.
‘‘(e) DEFINITION.—For purposes of this section, the
term ‘State’ does not include Guam, American Samoa, the
United States Virgin Islands, and the Commonwealth of
the Northern Mariana Islands.
‘‘SEC. 675C. USES OF FUNDS.
‘‘(a) GRANTS TO LOCAL ELIGIBLE ENTITIES AND
OTHER ORGANIZATIONS.—
‘‘(1) IN GENERAL.—Not less than 90 percent of
the funds allotted to a State under section 675B
shall be used by the State to make grants for the
purposes described in section 672 to eligible entities.
‘‘(2) OBLIGATIONAL
AUTHORITY.—Funds dis-
tributed to eligible entities through grants made in
accordance with paragraph (1) for a fiscal year shall
be available for obligation during that fiscal year
and the succeeding fiscal year, in accordance with
paragraph (3).
‘‘(3) RECAPTURE AND REDISTRIBUTION OF UN-
OBLIGATED FUNDS.—
‘‘(A) AMOUNT.—Beginning on October 1,
2000, a State may recapture and redistribute
funds distributed to an eligible entity through a
grant made under paragraph (1) that are unob-
ligated at the end of a fiscal year if such unobli-
gated funds exceed 20 percent of the amount
so distributed to such eligible entity for such
fiscal year.
‘‘(B) REDISTRIBUTION.—In redistributing
funds recaptured in accordance with this para-
graph, States shall redistribute such funds to
an eligible entity, or require the original recipi-
ent of the funds to redistribute the funds to a
private, nonprofit organization, located within
the community served by the original recipient
of the funds, for activities consistent with the
purposes of this subtitle.
‘‘(b) STATEWIDE ACTIVITIES.—
‘‘(1) USE OF REMAINDER.—If a State uses less
than 100 percent of the State allotment to make
grants under subsection (a), the State shall use the
remainder of the allotment (subject to paragraph
(2)) for—
‘‘(A) providing training and technical as-
sistance to those entities in need of such train-
ing and assistance;
‘‘(B) coordinating State-operated programs
and services targeted to low-income children
and families with services provided by eligible
entities and other organizations funded under
this subtitle, including detailing appropriate
employees of State or local agencies to entities
funded under this subtitle, to ensure increased
access to services provided by such State or
local agencies;
‘‘(C) supporting statewide coordination and
communication among eligible entities;
‘‘(D) analyzing the distribution of funds
made available under this subtitle within the
State to determine if such funds have been tar-
geted to the areas of greatest need;
‘‘(E) supporting asset-building programs
for low-income individuals, such as programs
supporting individual development accounts;
‘‘(F) supporting innovative programs and
activities conducted by community action agen-
cies or other neighborhood-based organizations
to eliminate poverty, promote self-sufficiency,
and promote community revitalization; and
‘‘(G) supporting other activities, consistent
with the purposes of this subtitle.
‘‘(2) ADMINISTRATIVE
CAP.—No State may
spend more than the greater of $55,000, or 5 per-
cent, of the portion of the State allotment that re-
mains after the State makes grants to eligible enti-
ties under subsection (a), for administrative ex-
penses, including monitoring activities. The cost of
activities conducted under paragraph (1)(A) shall
not be considered to be administrative expenses.
‘‘SEC. 676. APPLICATION AND PLAN.
‘‘(a) DESIGNATION OF LEAD AGENCY.—
‘‘(1) DESIGNATION.—The chief executive officer
of a State desiring to receive an allotment under this
subtitle shall designate, in an application submitted
to the Secretary under subsection (b), an appro-
priate State agency that complies with the require-
ments of paragraph (2) to act as a lead agency for
purposes of carrying out State activities under this
subtitle.
‘‘(2) DUTIES.—The lead agency shall—
‘‘(A) develop the State plan to be submit-
ted to the Secretary under subsection (b);
‘‘(B) in conjunction with the development
of the State plan as required under subsection
(b), hold at least 1 hearing in the State with
sufficient time and statewide distribution of no-
tice of such hearing, to provide to the public an
opportunity to comment on the proposed use
and distribution of funds to be provided
through the allotment for the period covered by
the State plan; and
‘‘(C) conduct reviews of eligible entities
under section 678B.
‘‘(3) LEGISLATIVE HEARING.—The State shall
hold at least 1 legislative hearing every 3 years in
conjunction with the development of the State plan.
‘‘(b) STATE APPLICATION
AND PLAN.—Beginning
with fiscal year 2000, to be eligible to receive an allotment
under this subtitle, a State shall prepare and submit to
the Secretary an application and State plan covering a pe-
riod of not less than 1 fiscal year and not more than 2
fiscal years. The plan shall be submitted not later than
30 days prior to the beginning of the first fiscal year cov-
ered by the plan, and shall contain such information as
the Secretary shall require, including—
‘‘(1) an assurance that funds made available
through the allotment will be used to support activi-
ties that are designed to assist low-income families
and individuals, including families and individuals
receiving assistance under title IV of the Social Se-
curity Act, homeless families and individuals, mi-
grant or seasonal farmworkers, and elderly low-in-
come individuals and families, and a description of
how such activities will enable the families and indi-
viduals—
‘‘(A) to remove obstacles and solve prob-
lems that block the achievement of self-suffi-
ciency (particularly families and individuals who
are attempting to transition off a State pro-
gram carried out under title IV of the Social
Security Act);
‘‘(B) to secure and retain meaningful em-
ployment;
‘‘(C) to attain an adequate education with
particular attention toward improving literacy
skills of the low-income families in the commu-
nity, which may include family literacy initia-
tives;
‘‘(D) to make better use of available in-
come;
‘‘(E) to obtain and maintain adequate
housing and a suitable living environment;
‘‘(F) 
to 
obtain 
emergency 
assistance
through loans, grants, or other means to meet
immediate and urgent individual and family
needs;
‘‘(G) to achieve greater participation in the
affairs of the community, including activities
that strengthen and improve the relationship
with local law enforcement agencies, which may
include activities such as neighborhood or com-
munity policing efforts;
‘‘(H) to address the needs of youth in low-
income communities through youth development
programs that support the primary role of the
family, give priority to prevention of youth
problems and crime, promote increased commu-
nity coordination and collaboration in meeting
the needs of youth, and support development
and expansion of innovative community-based
youth development programs, which may in-
clude after-school child care programs; and
‘‘(I) to make more effective use of other
programs related to the purposes of this sub-
title (including State welfare reform efforts);
‘‘(2) a description of how the State intends to
use discretionary funds made available from the re-
mainder of the allotment described in section
675C(b) in accordance with this subtitle, including a
description of how the State will support innovative
community and neighborhood-based initiatives relat-
ed to the purposes of this subtitle;
‘‘(3) based on information provided by eligible
entities in the State, a description of—
‘‘(A) the service delivery system, for serv-
ices provided or coordinated with funds made
available through the allotment, targeted to
low-income individuals and families in commu-
nities within the State;
‘‘(B) a description of how linkages will be
developed to fill identified gaps in the services,
through the provision of information, referrals,
case management, and followup consultations;
‘‘(C) a description of how funds made
available through the allotment will be coordi-
nated with other public and private resources;
and
‘‘(D) a description of how the funds will be
used to support innovative community and
neighborhood-based initiatives related to the
purposes of this subtitle which may include fa-
therhood and other initiatives with the goal of
strengthening families and encouraging paren-
tal responsibility;
‘‘(4) an assurance that the State will provide,
on an emergency basis, for the provision of such
supplies and services, nutritious foods, and related
services, as may be necessary to counteract condi-
tions of starvation and malnutrition among low-in-
come individuals;
‘‘(5) an assurance that the State will coordi-
nate, and establish linkages between, governmental
and other social services programs to assure the ef-
fective delivery of such services to low-income indi-
viduals;
‘‘(6) an assurance that the State will ensure co-
ordination between antipoverty programs in each
community, and ensure, where appropriate, that
emergency energy crisis intervention programs under
title XXVI (relating to low-income home energy as-
sistance) are conducted in such community;
‘‘(7) an assurance that the State will permit
and cooperate with Federal investigations under-
taken in accordance with section 678D;
‘‘(8) an assurance that any eligible entity that
received funding in the previous fiscal year under
this subtitle will not have its funding terminated
under this subtitle, or reduced below the propor-
tional share of funding the entity received in the
previous fiscal year unless, after providing notice
and an opportunity for a hearing on the record, the
State determines that cause exists for such termi-
nation or such reduction, subject to review by the
Secretary as provided in section 678C(b);
‘‘(9) an assurance that the State will, to the
maximum extent possible, coordinate programs with
and form partnerships with other organizations serv-
ing low-income residents of the communities and
members of the groups served by the State, includ-
ing faith-based organizations, charitable groups, and
community organizations;
‘‘(10) an assurance that the State will require
each eligible entity to establish procedures under
which a low-income individual, community organiza-
tion, or faith-based organization, or representative of
low-income individuals that considers its organiza-
tion, or low-income individuals, to be inadequately
represented on the board (or other mechanism) of
the eligible entity to petition for adequate represen-
tation;
‘‘(11) an assurance that the State will secure
from each eligible entity, as a condition to receipt of
funding by the entity under this subtitle for a pro-
gram, a community action plan (which shall be sub-
mitted to the Secretary, at the request of the Sec-
retary, with the State plan) that includes a commu-
nity-needs assessment for the community served,
which may be coordinated with community-needs as-
sessments conducted for other programs;
‘‘(12) an assurance that the State and all eligi-
ble entities in the State will, not later than fiscal
year 2001, participate in the Results Oriented Man-
agement and Accountability System, another per-
formance measure system established pursuant to
section 678E(b), or an alternative system for meas-
uring performance and results that meets the re-
quirements of that section, and a description of out-
come measures to be used to measure eligible entity
performance in promoting self-sufficiency, family
stability, and community revitalization; and
‘‘(13) information describing how the State will
carry out the assurances described in this sub-
section.
‘‘(c) FUNDING TERMINATION OR REDUCTIONS.—For
purposes of making a determination in accordance with
subsection (b)(8) with respect to—
‘‘(1) a funding reduction, the term ‘cause’ in-
cludes—
‘‘(A) a statewide redistribution of funds
provided under this subtitle to respond to—
‘‘(i) the results of the most recently
available census or other appropriate data;
such a manner as will facilitate review of, and com-
ment on, the plan.
‘‘SEC. 676A. DESIGNATION AND REDESIGNATION OF ELIGI-
BLE ENTITIES IN UNSERVED AREAS.
‘‘(a) QUALIFIED
ORGANIZATION
IN
OR
NEAR
AREA.—
‘‘(1) IN GENERAL.—If any geographic area of a
State is not, or ceases to be, served by an eligible
entity under this subtitle, and if the chief executive
officer of the State decides to serve such area, the
chief executive officer may solicit applications from,
and designate as an eligible entity—
‘‘(A) a private nonprofit eligible entity lo-
cated in an area contiguous to or within reason-
able proximity of the unserved area that is al-
ready providing related services in the unserved
area; or
‘‘(B) a private nonprofit organization that
is geographically located in the unserved area
that is capable of providing a broad range of
services designed to eliminate poverty and fos-
ter self-sufficiency and that meets the require-
ments of this subtitle.
‘‘(2) REQUIREMENT.—In order to serve as the
eligible entity for the area, an entity described in
paragraph (1)(B) shall agree to add additional mem-
bers to the board of the entity to ensure adequate
representation—
‘‘(A) in each of the 3 required categories
described in subparagraphs (A), (B), and (C) of
section 676B(a)(2), by members that reside in
the community comprised by the unserved area;
and
‘‘(B) in the category described in section
676B(a)(2), by members that reside in the
neighborhood served.
‘‘(b) SPECIAL CONSIDERATION.—In designating an
eligible entity under subsection (a), the chief executive of-
ficer shall grant the designation to an organization of
demonstrated effectiveness in meeting the goals and pur-
poses of this subtitle and may give priority, in granting
the designation, to local eligible entities that are already
providing related services in the unserved area, consistent
with the needs identified by a community-needs assess-
ment.
‘‘(c) NO QUALIFIED ORGANIZATION
IN
OR NEAR
AREA.—If no private, nonprofit organization is identified
or determined to be qualified under subsection (a) to serve
the unserved area as an eligible entity the chief executive
officer may designate an appropriate political subdivision
of the State to serve as an eligible entity for the area.
In order to serve as the eligible entity for that area, the
political subdivision shall have a board or other mecha-
nism as required in section 676B(b).
‘‘SEC. 676B. TRIPARTITE BOARDS.
‘‘(a) PRIVATE NONPROFIT ENTITIES.—
‘‘(1) BOARD.—In order for a private, nonprofit
entity to be considered to be an eligible entity for
purposes of section 673(1), the entity shall admin-
ister the community services block grant program
through a tripartite board described in paragraph
(2) that fully participates in the development and
implementation of the program to serve low-income
communities or groups.
‘‘(2) 
SELECTION
AND
COMPOSITION
OF
BOARD.—The members of the board referred to in
paragraph (1) shall be selected by the entity and the
board shall be composed so as to assure that—
‘‘(A) 1⁄3 of the members of the board are
elected public officials, holding office on the
date of selection, or their representatives, ex-
cept that if the number of elected officials rea-
sonably available and willing to serve on the
board is less than 1⁄3 of the membership of the
board, membership on the board of appointive
public officials or their representatives may be
counted in meeting such 1⁄3 requirement;
‘‘(B) not fewer than 1⁄3 of the members are
persons chosen in accordance with democratic
selection procedures adequate to assure that
these members are representative of low-income
individuals and families in the neighborhood
served;
‘‘(C) the remainder of the members are of-
ficials or members of business, industry, labor,
religious, law enforcement, education, or other
major groups and interests in the community
served; and
‘‘(D)(i) each member resides in the com-
munity; and
‘‘(ii) each representative of low-income in-
dividuals and families selected to represent a
specific neighborhood within a community
under this paragraph resides in the neighbor-
hood represented by the member.
‘‘(b) PUBLIC ORGANIZATIONS.—In order for a public
organization to be considered to be an eligible entity for
purposes of section 673(1), the entity shall administer the
community services block grant program through—
‘‘(1) a tripartite board, which shall have mem-
bers selected by the organization and shall be com-
posed so as to assure that not fewer than 1⁄3 of the
members are persons chosen in accordance with
democratic selection procedures adequate to assure
that these members—
‘‘(A) are representative of low-income indi-
viduals and families in the neighborhood served;
‘‘(B) reside in the neighborhood served;
and
‘‘(C) are able to participate actively in the
planning and implementation of programs fund-
ed under this subtitle; or
‘‘(2) another mechanism specified by the State
to assure decisionmaking and participation by low-
income individuals in the planning, administration,
and evaluation of programs funded under this sub-
title.
‘‘SEC. 677. PAYMENTS TO INDIAN TRIBES.
‘‘(a) RESERVATION.—If, with respect to any State,
the Secretary—
‘‘(1) receives a request from the governing body
of an Indian tribe or tribal organization within the
State that assistance under this subtitle be made di-
rectly to such tribe or organization; and
‘‘(2) determines that the members of such tribe
or tribal organization would be better served by
means of grants made directly to provide benefits
under this subtitle,
the Secretary shall reserve from amounts that would oth-
erwise be allotted to such State under section 675B for
the fiscal year the amount determined under subsection
(b).
‘‘(b) DETERMINATION OF RESERVED AMOUNT.—The
Secretary shall reserve for the purpose of subsection (a)
from amounts that would otherwise be allotted to such
State, not less than 100 percent of an amount that bears
the same ratio to the State allotment for the fiscal year
involved as the population of all eligible Indians for whom
a determination has been made under subsection (a) bears
to the population of all individuals eligible for assistance
under this subtitle in such State.
‘‘(c) AWARDS.—The sums reserved by the Secretary
on the basis of a determination made under subsection (a)
shall be made available by grant to the Indian tribe or
tribal organization serving the individuals for whom such
a determination has been made.
‘‘(d) PLAN.—In order for an Indian tribe or tribal
organization to be eligible for a grant award for a fiscal
year under this section, the tribe or organization shall sub-
mit to the Secretary a plan for such fiscal year that meets
such criteria as the Secretary may prescribe by regulation.
‘‘(e) DEFINITIONS.—In this section:
‘‘(1) INDIAN TRIBE; TRIBAL ORGANIZATION.—
The terms ‘Indian tribe’ and ‘tribal organization’
mean a tribe, band, or other organized group recog-
nized in the State in which the tribe, band, or group
resides, or considered by the Secretary of the Inte-
rior, to be an Indian tribe or an Indian organization
for any purpose.
‘‘(2) INDIAN.—The term ‘Indian’ means a
member of an Indian tribe or of a tribal organiza-
tion.
‘‘SEC. 678. OFFICE OF COMMUNITY SERVICES.
‘‘(a) OFFICE.—The Secretary shall carry out the
functions of this subtitle through an Office of Community
Services, which shall be established in the Department of
Health and Human Services. The Office shall be headed
by a Director.
‘‘(b) GRANTS, CONTRACTS, COOPERATIVE AGREE-
MENTS.—The Secretary shall carry out functions of this
subtitle through grants, contracts, or cooperative agree-
ments.
‘‘SEC. 678A. TRAINING AND TECHNICAL ASSISTANCE.
‘‘(a) ACTIVITIES.—The Secretary shall use the
amounts reserved in section 674(b)(2) for training, tech-
nical assistance, planning, evaluation, and data collection
activities related to programs carried out under this sub-
title.
‘‘(b) PROCESS.—The process for determining the
training and technical assistance to be carried out under
this section shall—
‘‘(1) ensure that the needs of eligible entities
and programs relating to improving program quality,
including financial management practices, are ad-
dressed to the maximum extent feasible; and
‘‘(2) incorporate mechanisms to ensure respon-
siveness to local needs, including an ongoing proce-
dure for obtaining input from the national and State
network of eligible entities.
‘‘SEC. 678B. MONITORING OF ELIGIBLE ENTITIES.
‘‘(a) IN GENERAL.—In order to determine whether
eligible entities meet the performance goals, administra-
tive standards, financial management requirements, and
other requirements of a State, the State shall conduct the
following reviews of eligible entities:
‘‘(1) A full onsite review of each such entity at
least once during each 3-year period.
‘‘(2) An onsite review of each newly designated
entity immediately after the completion of the first
year in which such entity receives funds through the
community services block grant program.
‘‘(3) Followup reviews including prompt return
visits to eligible entities, and their programs, that
fail to meet the goals, standards, and requirements
established by the State.
‘‘(4) Other reviews as appropriate, including re-
views of entities with programs that have had other
Federal, State, or local grants terminated for cause.
‘‘(b) REQUESTS.—The State may request training
and technical assistance from the Secretary as needed to
comply with the requirements of this section.
‘‘SEC. 678C. CORRECTIVE ACTION; TERMINATION AND RE-
DUCTION OF FUNDING.
‘‘(a) DETERMINATION.—If the State determines, on
the basis of a review pursuant to subsection 678B, that
an eligible entity materially fails to comply with the terms
of an agreement, or the State plan, to provide services
under this subtitle or to meet appropriate standards,
goals, and other requirements established by the State (in-
cluding performance objectives), the State shall—
‘‘(1) inform the entity of the deficiency to be
corrected;
‘‘(2) require the entity to correct the deficiency;
‘‘(3)(A) offer training and technical assistance,
if appropriate, to help correct the deficiency, and
prepare and submit to the Secretary a report de-
scribing the training and technical assistance of-
fered; or
‘‘(B) if the State determines that such training
and technical assistance are not appropriate, prepare
and submit to the Secretary a report stating the rea-
sons for the determination;
‘‘(4)(A) at the discretion of the State (taking
into account the seriousness of the deficiency and
the time reasonably required to correct the defi-
ciency), allow the entity to develop and implement,
within 60 days after being informed of the defi-
ciency, a quality improvement plan to correct such
deficiency within a reasonable period of time, as de-
termined by the State; and
‘‘(B) not later than 30 days after receiving
from an eligible entity a proposed quality improve-
ment plan pursuant to subparagraph (A), either ap-
prove such proposed plan or specify the reasons why
the proposed plan cannot be approved; and
‘‘(5) after providing adequate notice and an op-
portunity for a hearing, initiate proceedings to ter-
minate the designation of or reduce the funding
under this subtitle of the eligible entity unless the
entity corrects the deficiency.
‘‘(b) REVIEW.—A determination to terminate the
designation or reduce the funding of an eligible entity is
reviewable by the Secretary. The Secretary shall, upon re-
quest, review such a determination. The review shall be
completed not later than 120 days after the determination
to terminate the designation or reduce the funding. If the
review is not completed within 120 days, the determina-
tion of the State shall become final at the end of the 120th
day.
‘‘SEC. 678D. FISCAL CONTROLS, AUDITS, AND WITHHOLD-
ING.
‘‘(a) FISCAL CONTROLS, PROCEDURES, AUDITS, AND
INSPECTIONS.—
‘‘(1) IN GENERAL.—A State that receives funds
under this subtitle shall—
‘‘(A) establish fiscal control and fund ac-
counting procedures necessary to assure the
proper disbursal of and accounting for Federal
funds paid to the State under this subtitle, in-
cluding procedures for monitoring the funds
provided under this subtitle;
‘‘(B) ensure that cost and accounting
standards of the Office of Management and
Budget apply to a recipient of funds under this
subtitle;
‘‘(C) prepare, at least every year (or in the
case of a State with a 2-year State plan, every
2 years) in accordance with paragraph (2) an
audit of the expenditures of the State of
amounts received under this subtitle and
amounts transferred to carry out the purposes
of this subtitle; and
‘‘(D) make appropriate books, documents,
papers, and records available to the Secretary
and the Comptroller General of the United
States, or any of their duly authorized rep-
resentatives, for examination, copying, or me-
chanical reproduction on or off the premises of
the appropriate entity upon a reasonable re-
quest for the items.
‘‘(2) AUDITS.—Each audit required by sub-
section (a)(1)(C) shall be conducted by an entity
independent of any agency administering activities
or services carried out under this subtitle and shall
be conducted in accordance with generally accepted
accounting principles. Within 30 days after the com-
pletion of each such audit in a State, the chief exec-
utive officer of the State shall submit a copy of such
audit to any eligible entity that was the subject of
the audit at no charge, to the legislature of the
State, and to the Secretary.
‘‘(3) REPAYMENTS.—The State shall repay to
the United States amounts found not to have been
expended in accordance with this subtitle or the Sec-
retary may offset such amounts against any other
amount to which the State is or may become entitled
under this subtitle.
‘‘(b) WITHHOLDING.—
‘‘(1) IN GENERAL.—The Secretary shall, after
providing adequate notice and an opportunity for a
hearing conducted within the affected State, with-
hold funds from any State that does not utilize the
State allotment substantially in accordance with the
provisions of this subtitle, including the assurances
such State provided under section 676.
‘‘(2) RESPONSE
TO
COMPLAINTS.—The Sec-
retary shall respond in an expeditious and speedy
manner to complaints of a substantial or serious na-
ture that a State has failed to use funds in accord-
ance with the provisions of this subtitle, including
the assurances provided by the State under section
676. For purposes of this paragraph, a complaint of
a failure to meet any 1 of the assurances provided
under section 676 that constitutes disregarding that
assurance shall be considered to be a complaint of
a serious nature.
‘‘(3) INVESTIGATIONS.—Whenever the Sec-
retary determines that there is a pattern of com-
plaints of failures described in paragraph (2) from
any State in any fiscal year, the Secretary shall con-
duct an investigation of the use of funds received
under this subtitle by such State in order to ensure
compliance with the provisions of this subtitle.
‘‘SEC. 678E. ACCOUNTABILITY AND REPORTING REQUIRE-
MENTS.
‘‘(a) STATE ACCOUNTABILITY AND REPORTING RE-
QUIREMENTS.—
‘‘(1) PERFORMANCE MEASUREMENT.—
‘‘(A) IN GENERAL.—By October 1, 2001,
each State that receives funds under this sub-
title shall participate, and shall ensure that all
eligible entities in the State participate, in a
performance measurement system, which may
be a performance measurement system estab-
lished by the Secretary pursuant to subsection
(b), or an alternative system that meets the re-
quirements of subsection (b).
‘‘(B) LOCAL AGENCIES.—The State may
elect to have local agencies who are subcontrac-
tors of the eligible entities under this subtitle
participate in the performance measurement
system. If the State makes that election, ref-
erences in this section to eligible entities shall
be considered to include the local agencies.
‘‘(2) ANNUAL REPORT.—Each State shall annu-
ally prepare and submit to the Secretary a report on
the measured performance of the State and the eligi-
ble entities in the State. Each State shall also in-
clude in the report an accounting of the expenditure
of funds received by the State through the commu-
nity services block grant program, including an ac-
counting of funds spent on indirect services or ad-
ministrative costs by the State and the eligible enti-
ties, and funds spent by eligible entities on the di-
rect delivery of local services, and shall include infor-
mation on the number of and characteristics of cli-
ents served under this subtitle in the State, based on
data collected from the eligible entities. The State
shall also include in the report a summary describ-
ing the training and technical assistance offered by
the State under section 678C(a)(3) during the year
covered by the report.
‘‘(b) SECRETARY’S ACCOUNTABILITY AND REPORT-
ING REQUIREMENTS.—
‘‘(1) PERFORMANCE MEASUREMENT.—The Sec-
retary, in collaboration with the States and with eli-
gible entities throughout the Nation, shall facilitate
the development of 1 or more model performance
measurement systems, which may be used by the
States and by eligible entities to measure their per-
formance in carrying out the requirements of this
subtitle and in achieving the goals of their commu-
nity action plans. The Secretary shall provide tech-
nical assistance, including support for the enhance-
ment of electronic data systems, to States and to eli-
gible entities to enhance their capability to collect
and report data for such a system and to aid in
their participation in such a system.
‘‘(2) REPORTING REQUIREMENTS.—At the end
of each fiscal year beginning after September 30,
1999, the Secretary shall, directly or by grant or
contract, prepare a report containing—
‘‘(A) a summary of the planned use of
funds by each State, and the eligible entities in
the State, under the community services block
grant program, as contained in each State plan
submitted pursuant to section 676;
‘‘(B) a description of how funds were actu-
ally spent by the State and eligible entities in
the State, including a breakdown of funds spent
on indirect services or administrative costs and
on the direct delivery of local services by eligible
entities;
‘‘(C) information on the number of entities
eligible for funds under this subtitle, the num-
ber of low-income persons served under this
subtitle, and such demographic data on the low-
income populations served by eligible entities as
is determined by the Secretary to be feasible;
‘‘(D) a comparison of the planned uses of
funds for each State and the actual uses of the
funds;
‘‘(E) a summary of each State’s perform-
ance results, and the results for the eligible en-
tities, as collected and submitted by the States
in accordance with subsection (a)(2); and
‘‘(F) any additional information that the
Secretary considers to be appropriate to carry
out this subtitle, if the Secretary informs the
States of the need for such additional informa-
tion and allows a reasonable period of time
prior to the start of the fiscal year for the
States to collect and provide the information.
‘‘(3) SUBMISSION.—The Secretary shall submit
to the Committee on Education and the Workforce
of the House of Representatives and the Committee
on Labor and Human Resources of the Senate the
report described in paragraph (2), and any com-
ments the Secretary may have with respect to such
report. The report shall include definitions of direct,
indirect, and administrative costs used by the De-
partment of Health and Human Services for pro-
grams funded under this subtitle.
‘‘(4) COSTS.—Of the funds reserved under sec-
tion 674(b)(3), not more than $350,000 shall be
available to carry out the reporting requirements
contained in paragraph (2) and the provision of
technical assistance described in paragraph (1).
‘‘SEC. 678F. LIMITATIONS ON USE OF FUNDS.
‘‘(a) CONSTRUCTION OF FACILITIES.—
‘‘(1) LIMITATIONS.—Except as provided in
paragraph (2), grants made under this subtitle
(other 
than 
amounts 
reserved 
under 
section
674(b)(3)) may not be used by the State, or by any
other person with which the State makes arrange-
ments to carry out the purposes of this subtitle, for
the purchase or improvement of land, or the pur-
chase, construction, or permanent improvement
(other than low-cost residential weatherization or
other energy-related home repairs) of any building
or other facility.
‘‘(2) WAIVER.—The Secretary may waive the
limitation contained in paragraph (1) upon a State
request for such a waiver, if the Secretary finds that
the request describes extraordinary circumstances to
justify the purchase of land or the construction of
facilities (or the making of permanent improve-
ments) and that permitting the waiver will contrib-
ute to the ability of the State to carry out the pur-
poses of this subtitle.
‘‘(b) POLITICAL ACTIVITIES.—
‘‘(1) TREATMENT AS A STATE OR LOCAL AGEN-
CY.—For purposes of chapter 15 of title 5, United
States Code, any entity that assumes responsibility
for planning, developing, and coordinating activities
under this subtitle and receives assistance under this
subtitle shall be deemed to be a State or local agen-
cy. For purposes of paragraphs (1) and (2) of sec-
tion 1502(a) of such title, any entity receiving as-
sistance under this subtitle shall be deemed to be a
State or local agency.
‘‘(2) PROHIBITIONS.—Programs assisted under
this subtitle shall not be carried on in a manner in-
volving the use of program funds, the provision of
services, or the employment or assignment of per-
sonnel, in a manner supporting or resulting in the
identification of such programs with—
‘‘(A) any partisan or nonpartisan political
activity or any political activity associated with
a candidate, or contending faction or group, in
an election for public or party office;
‘‘(B) any activity to provide voters or pro-
spective voters with transportation to the polls
or similar assistance in connection with any
such election; or
‘‘(C) any voter registration activity.
‘‘(3) RULES
AND
REGULATIONS.—The Sec-
retary, after consultation and regulations with the
Office of Personnel Management, shall issue rules
and regulations to provide for the enforcement of
this subsection, which shall include provisions for
summary suspension of assistance or other action
necessary to permit enforcement on an emergency
basis.
‘‘(c) NONDISCRIMINATION.—
‘‘(1) IN
GENERAL.—No person shall, on the
basis of race, color, religion, national origin, or sex
be excluded from participation in, be denied the ben-
efits of, or be subjected to discrimination under, any
program or activity funded in whole or in part with
funds made available under this subtitle. Any prohi-
bition against discrimination on the basis of age
under the Age Discrimination Act of 1975 (42
U.S.C. 6101 et seq.) or with respect to an otherwise
qualified individual with a disability as provided in
section 504 of the Rehabilitation Act of 1973 (29
U.S.C. 794) or title II of the Americans with Dis-
abilities Act of 1990 (42 U.S.C. 12131 et seq.) shall
also apply to any such program or activity.
‘‘(2) ACTION
OF
SECRETARY.—Whenever the
Secretary determines that a State that has received
a payment under this subtitle has failed to comply
with paragraph (1) or an applicable regulation, the
Secretary shall notify the chief executive officer of
the State and shall request that the officer secure
compliance. If within a reasonable period of time,
not to exceed 60 days, the chief executive officer
fails or refuses to secure compliance, the Secretary
is authorized to—
‘‘(A) refer the matter to the Attorney Gen-
eral with a recommendation that an appropriate
civil action be instituted;
‘‘(B) exercise the powers and functions
provided by title VI of the Civil Rights Act of
1964 (42 U.S.C. 2000d et seq.), the Age Dis-
crimination Act of 1975 (42 U.S.C. 6101 et
seq.), or section 504 of the Rehabilitation Act
of 1973 (29 U.S.C. 794), as may be applicable;
or
‘‘(C) take such other action as may be pro-
vided by law.
‘‘(3) ACTION OF ATTORNEY GENERAL.—When a
matter is referred to the Attorney General pursuant
to paragraph (2), or whenever the Attorney General
has reason to believe that the State is engaged in a
pattern or practice of discrimination in violation of
the provisions of this subsection, the Attorney Gen-
eral may bring a civil action in any appropriate
United States district court for such relief as may
be appropriate, including injunctive relief.
‘‘SEC. 679. OPERATIONAL RULE.
‘‘(a) FAITH-BASED ORGANIZATIONS INCLUDED AS
NONGOVERNMENTAL PROVIDERS.—For any program car-
ried out by the Federal Government, or by a State or local
government under this subtitle, the government shall con-
sider, on the same basis as other nongovernmental organi-
zations, faith-based organizations to provide the assistance
under the program, so long as the program is implemented
in a manner consistent with the Establishment Clause of
the first amendment to the Constitution. Neither the Fed-
eral Government nor a State or local government receiving
funds under this subtitle shall discriminate against an or-
ganization that provides assistance under, or applies to
provide assistance under, this subtitle, on the basis that
the organization has a faith-based character.
‘‘(b) ADDITIONAL SAFEGUARDS.—Neither the Fed-
eral Government nor a State or local government shall re-
quire a faith-based organization to remove religious art,
icons, scripture, or other symbols in order to be eligible
to provide assistance under a program described in sub-
section (a).
‘‘(c) LIMITATIONS ON USE OF FUNDS FOR CERTAIN
PURPOSES.—No funds provided through a grant or con-
tract to a faith-based organization to provide assistance
under any program described in subsection (a) shall be
expended for sectarian worship, instruction, or proselytiza-
tion.
‘‘(d) FISCAL ACCOUNTABILITY.—
‘‘(1) IN GENERAL.—Except as provided in para-
graph (2), any faith-based organization providing as-
sistance under any program described in subsection
(a) shall be subject to the same regulations as other
nongovernmental organizations to account in accord
with generally accepted accounting principles for the
use of such funds provided under such program.
‘‘(2) LIMITED AUDIT.—Such organization shall
segregate government funds provided under such
program into a separate account. Only the govern-
ment funds shall be subject to audit by the govern-
ment.
‘‘SEC. 680. DISCRETIONARY AUTHORITY OF THE SEC-
RETARY.
‘‘(a) GRANTS, CONTRACTS, ARRANGEMENTS, LOANS,
AND GUARANTEES.—
‘‘(1) IN GENERAL.—The Secretary shall, from
funds reserved under section 674(b)(3), make
grants, loans, or guarantees to States and public
agencies and private, nonprofit organizations, or
enter into contracts or jointly financed cooperative
arrangements with States and public agencies and
private, nonprofit organizations (and for-profit orga-
nizations, to the extent specified in (2)(E)) for each
of the objectives described in paragraphs (2) through
(4).
‘‘(2) COMMUNITY ECONOMIC DEVELOPMENT.—
‘‘(A) ECONOMIC
DEVELOPMENT
ACTIVI-
TIES.—The Secretary shall make grants de-
scribed in paragraph (1) on a competitive basis
to private, non-profit organizations that are
community development corporations to provide
technical and financial assistance for economic
development activities designed to address the
economic needs of low-income individuals and
families by creating employment and business
development opportunities.
‘‘(B) 
CONSULTATION.—The 
Secretary
shall exercise the authority provided under sub-
paragraph (A) after consultation with other rel-
evant Federal officials.
‘‘(C) GOVERNING BOARDS.—For a commu-
nity development corporation to receive funds to
carry out this paragraph, the corporation shall
be governed by a board that shall consist of
residents of the community and business and
civic leaders and shall have as a principal pur-
pose planning, developing, or managing low-in-
come 
housing 
or 
community 
development
projects.
‘‘(D) 
GEOGRAPHIC
DISTRIBUTION.—In
making grants to carry out this paragraph, the
Secretary shall take into consideration the geo-
graphic distribution of funding among States
and the relative proportion of funding among
rural and urban areas.
‘‘(E) RESERVATION.—Of the amounts
made available to carry out this paragraph, the
Secretary may reserve not more than 1 percent
for each fiscal year to make grants to private,
nonprofit organizations or to enter into con-
tracts with private, nonprofit or for-profit orga-
nizations to provide technical assistance to aid
community development corporations in devel-
oping or implementing activities funded to carry
out this paragraph and to evaluate activities
funded to carry out this paragraph.
‘‘(3) RURAL
COMMUNITY
DEVELOPMENT
AC-
TIVITIES.—The Secretary shall provide the assist-
ance described in paragraph (1) for rural community
development activities, which shall include—
‘‘(A) grants to private, nonprofit corpora-
tions that provide assistance concerning home
repair to rural low-income families and plan-
ning and developing low-income rural rental
housing units; and
‘‘(B) grants to multistate, regional, pri-
vate, nonprofit organizations to provide training
and technical assistance to small, rural commu-
nities in meeting their community facility needs.
‘‘(4) 
NEIGHBORHOOD
INNOVATION
PROJECTS.—The Secretary shall provide the assist-
ance described in paragraph (1) for neighborhood in-
novation projects, which shall include grants to
neighborhood-based private, nonprofit organizations
to test or assist in the development of new ap-
proaches or methods that will aid in overcoming spe-
cial problems identified by communities or neighbor-
hoods or otherwise assist in furthering the purposes
of this subtitle, and which may include projects that
are designed to serve low-income individuals and
families who are not being effectively served by other
programs.
‘‘(b) EVALUATION.—The Secretary shall require all
activities receiving assistance under this section to be eval-
uated for their effectiveness. Funding for such evaluations
shall be provided as a stated percentage of the assistance
or through a separate grant awarded by the Secretary spe-
cifically for the purpose of evaluation of a particular activ-
ity or group of activities.
‘‘(c) ANNUAL REPORT.—The Secretary shall compile
an annual report containing a summary of the evaluations
required in subsection (b) and a listing of all activities as-
sisted under this section. The Secretary shall annually
submit the report to the Chairperson of the Committee
on Education and the Workforce of the House of Rep-
resentatives and the Chairperson of the Committee on
Labor and Human Resources of the Senate.’’.
SEC. 3. RELATED AMENDMENTS.
The Community Services Block Grant Act (42 U.S.C.
9901 et seq.) is amended—
(1) by striking section 681;
(2) in section 681A—
(A) by striking ‘‘681A’’ and inserting
‘‘681’’;
(B) in subsection (c) by striking ‘‘Labor’’
and inserting ‘‘the Workforce’’; and
(C) 
in 
subsection 
(d) 
by 
striking
‘‘$25,000,000’’ and all that follows through
‘‘1998’’, and inserting ‘‘$4,000,000 for fiscal
year 1999, and such sums as may be necessary
for fiscal years 2000 through 2003.’’;
(3) in section 682—
(A) in subsection (c)—
(i) by redesignating paragraphs (3)
and (4) as paragraphs (4) and (5), respec-
tively; and
(ii) by inserting after paragraph (2)
the following:
‘‘(3) the applicant shall, in each community in
which a program is funded under this section—
‘‘(A) ensure that—
‘‘(i) a community-based advisory com-
mittee, composed of representatives of local
youth, family, and social service organiza-
tions, schools, entities that provide park
and recreation services, entities that pro-
vide training services, and community-
based organizations that serve high-risk
youth, is established; or
‘‘(ii) an existing community-based ad-
visory board, commission, or committee
with similar membership is used; and
‘‘(B) enter into formal partnerships with
youth-serving organizations or other appro-
priate social service entities in order to link pro-
gram participants with year-round services in
their home communities that support and con-
tinue the objectives of this subtitle;’’; and
(B) in subsection (g) by striking ‘‘each fis-
cal year’’ and all that follows through ‘‘1998’’,
and inserting ‘‘for fiscal year 1999, and such
sums as may be necessary for fiscal years 2000
through 2003’’; and
(4) by striking sections 683 and 684, and in-
serting the following:
‘‘SEC. 683. DRUG TESTING AND PATERNITY DETERMINA-
TIONS.
‘‘(a) DRUG TESTING PERMITTED.—(1) Nothing in
this subtitle shall be construed to prohibit a State from
testing participants in programs, activities, or services car-
ried out under this subtitle for controlled substances or
from imposing sanctions on such participants who test
positive for any of such substances.
‘‘(2) Any funds provided under this subtitle expended
for such testing shall be considered to be expended for ad-
ministrative expenses and shall be subject to the limitation
specified in section 675(b)(2).
‘‘(b) PATERNITY DETERMINATIONS.—During each
fiscal year for which an eligible entity receives a grant
under section 675C, such entity shall—
‘‘(1) inform custodial parents in single-parent
families that participate in programs, activities, or
services carried out under this subtitle about the
availability of child support services;
‘‘(2) refer eligible parents to the child support
offices of State and local governments;
‘‘(3) establish referral arrangements with such
offices; and
‘‘(4) verify that such custodial parents who re-
ceive benefits under title IV of the Social Security
Act comply with the provisions of title IV of such
Act.
‘‘SEC. 684. REFERENCES.
‘‘Any reference in any provision of law to the poverty
line set forth in section 624 or 625 of the Economic Op-
portunity Act of 1964 shall be construed to be a reference
to the poverty line defined in section 673 of this subtitle.
Any reference in any provision of law to any community
action agency designated under title II of the Economic
Opportunity Act of 1964 shall be construed to be a ref-
erence to an entity eligible to receive funds under the com-
munity services block grant program.’’.
SEC. 4. CONFORMING AMENDMENTS.
(a) PREPARATION.—After consultation with the ap-
propriate committees of Congress and the Director of the