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carry out activities that are provided for under laws in 
effect on the date of enactment of this title. 
‘‘SEC. 3012. HEALTH INFORMATION TECHNOLOGY IMPLE-
MENTATION ASSISTANCE. 
‘‘(a) HEALTH INFORMATION TECHNOLOGY EXTEN-
SION PROGRAM.—To assist health care providers to adopt, 
implement, and effectively use certified EHR technology 
that allows for the electronic exchange and use of health 
information, the Secretary, acting through the Office of 
the National Coordinator, shall establish a health informa-
tion technology extension program to provide health infor-
mation technology assistance services to be carried out 
through the Department of Health and Human Services. 
The National Coordinator shall consult with other Federal 
agencies with demonstrated experience and expertise in in-
formation technology services, such as the National Insti-
tute of Standards and Technology, in developing and im-
plementing this program. 
‘‘(b) HEALTH
INFORMATION
TECHNOLOGY
RE-
SEARCH CENTER.— 
‘‘(1) IN GENERAL.—The Secretary shall create 
a Health Information Technology Research Center 
(in this section referred to as the ‘Center’) to pro-
vide technical assistance and develop or recognize 
best practices to support and accelerate efforts to 
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adopt, implement, and effectively utilize health infor-
mation technology that allows for the electronic ex-
change and use of information in compliance with 
standards, implementation specifications, and certifi-
cation criteria adopted under section 3004(b). 
‘‘(2) INPUT.—The Center shall incorporate 
input from— 
‘‘(A) other Federal agencies with dem-
onstrated experience and expertise in informa-
tion technology services such as the National 
Institute of Standards and Technology; 
‘‘(B) users of health information tech-
nology, such as providers and their support and 
clerical staff and others involved in the care and 
care coordination of patients, from the health 
care and health information technology indus-
try; and 
‘‘(C) others as appropriate. 
‘‘(3) PURPOSES.—The purposes of the Center 
are to— 
‘‘(A) provide a forum for the exchange of 
knowledge and experience; 
‘‘(B) accelerate the transfer of lessons 
learned from existing public and private sector 
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AMDT. NO. 570 
initiatives, including those currently receiving 
Federal financial support; 
‘‘(C) assemble, analyze, and widely dis-
seminate evidence and experience related to the 
adoption, implementation, and effective use of 
health information technology that allows for 
the electronic exchange and use of information 
including through the regional centers described 
in subsection (c); 
‘‘(D) provide technical assistance for the 
establishment and evaluation of regional and 
local health information networks to facilitate 
the electronic exchange of information across 
health care settings and improve the quality of 
health care; 
‘‘(E) provide technical assistance for the 
development and dissemination of solutions to 
barriers to the exchange of electronic health in-
formation; and 
‘‘(F) learn about effective strategies to 
adopt and utilize health information technology 
in medically underserved communities. 
‘‘(c) HEALTH
INFORMATION
TECHNOLOGY
RE-
GIONAL EXTENSION CENTERS.— 
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‘‘(1) IN GENERAL.—The Secretary shall provide 
assistance for the creation and support of regional 
centers (in this subsection referred to as ‘regional 
centers’) to provide technical assistance and dissemi-
nate best practices and other information learned 
from the Center to support and accelerate efforts to 
adopt, implement, and effectively utilize health infor-
mation technology that allows for the electronic ex-
change and use of information in compliance with 
standards, implementation specifications, and certifi-
cation criteria adopted under section 3004. Activities 
conducted under this subsection shall be consistent 
with the strategic plan developed by the National 
Coordinator (and, as available) under section 3001. 
‘‘(2) AFFILIATION.—Regional centers shall be 
affiliated with any United States-based nonprofit in-
stitution or organization, or group thereof, that ap-
plies and is awarded financial assistance under this 
section. Individual awards shall be decided on the 
basis of merit. 
‘‘(3) OBJECTIVE.—The objective of the regional 
centers is to enhance and promote the adoption of 
health information technology through— 
‘‘(A) assistance with the implementation, 
effective use, upgrading, and ongoing mainte-
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AMDT. NO. 570 
nance of health information technology, includ-
ing electronic health records, to healthcare pro-
viders nationwide; 
‘‘(B) broad participation of individuals 
from industry, universities, and State govern-
ments; 
‘‘(C) active dissemination of best practices 
and research on the implementation, effective 
use, upgrading, and ongoing maintenance of 
health information technology, including elec-
tronic health records, to health care providers 
in order to improve the quality of healthcare 
and protect the privacy and security of health 
information; 
‘‘(D) participation, to the extent prac-
ticable, in health information exchanges; 
‘‘(E) utilization, when appropriate, of the 
expertise and capability that exists in federal 
agencies other than the Department; and 
‘‘(F) integration of health information 
technology, including electronic health records, 
into the initial and ongoing training of health 
professionals and others in the healthcare in-
dustry that would be instrumental to improving 
the quality of healthcare through the smooth 
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AMDT. NO. 570 
and accurate electronic use and exchange of 
health information. 
‘‘(4) REGIONAL
ASSISTANCE.—Each regional 
center shall aim to provide assistance and education 
to all providers in a region, but shall prioritize any 
direct assistance first to the following: 
‘‘(A) Public or not-for-profit hospitals or 
critical access hospitals. 
‘‘(B) Federally qualified health centers (as 
defined in section 1861(aa)(4) of the Social Se-
curity Act). 
‘‘(C) Entities that are located in rural and 
other areas that serve uninsured, underinsured, 
and medically underserved individuals (regard-
less of whether such area is urban or rural). 
‘‘(D) Individual or small group practices 
(or a consortium thereof) that are primarily fo-
cused on primary care. 
‘‘(5) FINANCIAL SUPPORT.—The Secretary may 
provide financial support to any regional center cre-
ated under this subsection for a period not to exceed 
four years. The Secretary may not provide more 
than 50 percent of the capital and annual operating 
and maintenance funds required to create and main-
tain such a center, except in an instance of national 
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AMDT. NO. 570 
economic conditions which would render this cost- 
share requirement detrimental to the program and 
upon notification to Congress as to the justification 
to waive the cost-share requirement. 
‘‘(6) NOTICE OF PROGRAM DESCRIPTION AND 
AVAILABILITY OF FUNDS.—The Secretary shall pub-
lish in the Federal Register, not later than 90 days 
after the date of the enactment of this Act, a draft 
description of the program for establishing regional 
centers under this subsection. Such description shall 
include the following: 
‘‘(A) A detailed explanation of the program 
and the programs goals. 
‘‘(B) Procedures to be followed by the ap-
plicants. 
‘‘(C) Criteria for determining qualified ap-
plicants. 
‘‘(D) Maximum support levels expected to 
be available to centers under the program. 
‘‘(7) APPLICATION
REVIEW.—The Secretary 
shall subject each application under this subsection 
to merit review. In making a decision whether to ap-
prove such application and provide financial support, 
the Secretary shall consider at a minimum the mer-
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AMDT. NO. 570 
its of the application, including those portions of the 
application regarding— 
‘‘(A) the ability of the applicant to provide 
assistance under this subsection and utilization 
of health information technology appropriate to 
the needs of particular categories of health care 
providers; 
‘‘(B) the types of service to be provided to 
health care providers; 
‘‘(C) geographical diversity and extent of 
service area; and 
‘‘(D) the percentage of funding and 
amount of in-kind commitment from other 
sources. 
‘‘(8) BIENNIAL
EVALUATION.—Each regional 
center which receives financial assistance under this 
subsection shall be evaluated biennially by an evalua-
tion panel appointed by the Secretary. Each evalua-
tion panel shall be composed of private experts, none 
of whom shall be connected with the center involved, 
and of Federal officials. Each evaluation panel shall 
measure the involved center’s performance against 
the objective specified in paragraph (3). The Sec-
retary shall not continue to provide funding to a re-
gional center unless its evaluation is overall positive. 
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AMDT. NO. 570 
‘‘(9) CONTINUING SUPPORT.—After the second 
year of assistance under this subsection a regional 
center may receive additional support under this 
subsection if it has received positive evaluations and 
a finding by the Secretary that continuation of Fed-
eral funding to the center was in the best interest 
of provision of health information technology exten-
sion services. 
‘‘SEC. 3013. STATE GRANTS TO PROMOTE HEALTH INFOR-
MATION TECHNOLOGY. 
‘‘(a) IN GENERAL.—The Secretary, acting through 
the National Coordinator, shall establish a program in ac-
cordance with this section to facilitate and expand the 
electronic movement and use of health information among 
organizations according to nationally recognized stand-
ards. 
‘‘(b) PLANNING GRANTS.—The Secretary may award 
a grant to a State or qualified State-designated entity (as 
described in subsection (d)) that submits an application 
to the Secretary at such time, in such manner, and con-
taining such information as the Secretary may specify, for 
the purpose of planning activities described in subsection 
(b). 
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AMDT. NO. 570 
‘‘(c) IMPLEMENTATION
GRANTS.—The Secretary 
may award a grant to a State or qualified State designated 
entity that— 
‘‘(1) has submitted, and the Secretary has ap-
proved, a plan described in subsection (c) (regardless 
of whether such plan was prepared using amounts 
awarded under paragraph (1)); and 
‘‘(2) submits an application at such time, in 
such manner, and containing such information as 
the Secretary may specify. 
‘‘(d) USE OF FUNDS.—Amounts received under a 
grant under subsection (a)(3) shall be used to conduct ac-
tivities to facilitate and expand the electronic movement 
and use of health information among organizations ac-
cording to nationally recognized standards through activi-
ties that include— 
‘‘(1) enhancing broad and varied participation 
in the authorized and secure nationwide electronic 
use and exchange of health information; 
‘‘(2) identifying State or local resources avail-
able towards a nationwide effort to promote health 
information technology; 
‘‘(3) complementing other Federal grants, pro-
grams, and efforts towards the promotion of health 
information technology; 
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AMDT. NO. 570 
‘‘(4) providing technical assistance for the de-
velopment and dissemination of solutions to barriers 
to the exchange of electronic health information; 
‘‘(5) promoting effective strategies to adopt and 
utilize health information technology in medically 
underserved communities; 
‘‘(6) assisting patients in utilizing health infor-
mation technology; 
‘‘(7) encouraging clinicians to work with Health 
Information Technology Regional Extension Centers 
as described in section 3012, to the extent they are 
available and valuable; 
‘‘(8) supporting public health agencies’ author-
ized use of and access to electronic health informa-
tion; 
‘‘(9) promoting the use of electronic health 
records for quality improvement including through 
quality measures reporting; 
‘‘(10) establishing and supporting health record 
banking models to further consumer-based consent 
models that promote lifetime access to qualified 
health records, if such activities are included in the 
plan described in subsection (e), and may contain 
smart card functionality; and 
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AMDT. NO. 570 
‘‘(11) such other activities as the Secretary may 
specify. 
‘‘(e) PLAN.— 
‘‘(1) IN GENERAL.—A plan described in this 
subsection is a plan that describes the activities to 
be carried out by a State or by the qualified State- 
designated entity within such State to facilitate and 
expand the electronic movement and use of health 
information among organizations according to na-
tionally recognized standards and implementation 
specifications. 
‘‘(2) REQUIRED ELEMENTS.—A plan described 
in paragraph (1) shall— 
‘‘(A) be pursued in the public interest; 
‘‘(B) be consistent with the strategic plan 
developed by the National Coordinator (and, as 
available) under section 3001; 
‘‘(C) include a description of the ways the 
State or qualified State-designated entity will 
carry out the activities described in subsection 
(b); and 
‘‘(D) contain such elements as the Sec-
retary may require. 
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AMDT. NO. 570 
‘‘(f) QUALIFIED STATE-DESIGNATED ENTITY.—For 
purposes of this section, to be a qualified State-designated 
entity, with respect to a State, an entity shall— 
‘‘(1) be designated by the State as eligible to 
receive awards under this section; 
‘‘(2) be a not-for-profit entity with broad stake-
holder representation on its governing board; 
‘‘(3) demonstrate that one of its principal goals 
is to use information technology to improve health 
care quality and efficiency through the authorized 
and secure electronic exchange and use of health in-
formation; 
‘‘(4) adopt nondiscrimination and conflict of in-
terest policies that demonstrate a commitment to 
open, fair, and nondiscriminatory participation by 
stakeholders; and 
‘‘(5) conform to such other requirements as the 
Secretary may establish. 
‘‘(g) REQUIRED CONSULTATION.—In carrying out 
activities described in subsections (a)(2) and (a)(3), a 
State or qualified State-designated entity shall consult 
with and consider the recommendations of— 
‘‘(1) health care providers (including providers 
that provide services to low income and underserved 
populations); 
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AMDT. NO. 570 
‘‘(2) health plans; 
‘‘(3) patient or consumer organizations that 
represent the population to be served; 
‘‘(4) health information technology vendors; 
‘‘(5) health care purchasers and employers; 
‘‘(6) public health agencies; 
‘‘(7) health professions schools, universities and 
colleges; 
‘‘(8) clinical researchers; 
‘‘(9) other users of health information tech-
nology such as the support and clerical staff of pro-
viders and others involved in the care and care co-
ordination of patients; and 
‘‘(10) such other entities, as may be determined 
appropriate by the Secretary. 
‘‘(h) CONTINUOUS IMPROVEMENT.—The Secretary 
shall annually evaluate the activities conducted under this 
section and shall, in awarding grants under this section, 
implement the lessons learned from such evaluation in a 
manner so that awards made subsequent to each such 
evaluation are made in a manner that, in the determina-
tion of the Secretary, will lead towards the greatest im-
provement in quality of care, decrease in costs, and the 
most effective authorized and secure electronic exchange 
of health information. 
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AMDT. NO. 570 
‘‘(i) REQUIRED MATCH.— 
‘‘(1) IN GENERAL.—For a fiscal year (begin-
ning with fiscal year 2011), the Secretary may not 
make a grant under subsection (a) to a State unless 
the State agrees to make available non-Federal con-
tributions (which may include in-kind contributions) 
toward the costs of a grant awarded under sub-
section (a)(3) in an amount equal to— 
‘‘(A) for fiscal year 2011, not less than $1 
for each $10 of Federal funds provided under 
the grant; 
‘‘(B) for fiscal year 2012, not less than $1 
for each $7 of Federal funds provided under 
the grant; and 
‘‘(C) for fiscal year 2013 and each subse-
quent fiscal year, not less than $1 for each $3 
of Federal funds provided under the grant. 
‘‘(2) AUTHORITY
TO
REQUIRE
STATE
MATCH 
FOR FISCAL YEARS BEFORE FISCAL YEAR 2011.—For 
any fiscal year during the grant program under this 
section before fiscal year 2011, the Secretary may 
determine the extent to which there shall be required 
a non-Federal contribution from a State receiving a 
grant under this section. 
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AMDT. NO. 570 
‘‘SEC. 3014. COMPETITIVE GRANTS TO STATES AND INDIAN 
TRIBES FOR THE DEVELOPMENT OF LOAN 
PROGRAMS 
TO 
FACILITATE 
THE 
WIDE-
SPREAD ADOPTION OF CERTIFIED EHR TECH-
NOLOGY. 
‘‘(a) IN GENERAL.—The National Coordinator may 
award competitive grants to eligible entities for the estab-
lishment of programs for loans to health care providers 
to conduct the activities described in subsection (e). 
‘‘(b) ELIGIBLE ENTITY DEFINED.—For purposes of 
this subsection, the term ‘eligible entity’ means a State 
or Indian tribe (as defined in the Indian Self-Determina-
tion and Education Assistance Act) that— 
‘‘(1) submits to the National Coordinator an 
application at such time, in such manner, and con-
taining such information as the National Coordi-
nator may require; 
‘‘(2) submits to the National Coordinator a 
strategic plan in accordance with subsection (d) and 
provides to the National Coordinator assurances that 
the entity will update such plan annually in accord-
ance with such subsection; 
‘‘(3) provides assurances to the National Coor-
dinator that the entity will establish a Loan Fund 
in accordance with subsection (c); 
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AMDT. NO. 570 
‘‘(4) provides assurances to the National Coor-
dinator that the entity will not provide a loan from 
the Loan Fund to a health care provider unless the 
provider agrees to— 
‘‘(A) submit reports on quality measures 
adopted by the Federal Government (by not 
later than 90 days after the date on which such 
measures are adopted), to— 
‘‘(i) the Director of the Centers for 
Medicare & Medicaid Services (or his or 
her designee), in the case of an entity par-
ticipating in the Medicare program under 
title XVIII of the Social Security Act or 
the Medicaid program under title XIX of 
such Act; or 
‘‘(ii) the Secretary in the case of other 
entities; 
‘‘(B) demonstrate to the satisfaction of the 
Secretary (through criteria established by the 
Secretary) that any certified EHR technology 
purchased, improved, or otherwise financially 
supported under a loan under this section is 
used to exchange health information in a man-
ner that, in accordance with law and standards 
(as adopted under section 3005) applicable to 
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AMDT. NO. 570 
the exchange of information, improves the qual-
ity of health care, such as promoting care co-
ordination; 
‘‘(C) comply with such other requirements 
as the entity or the Secretary may require; 
‘‘(D) include a plan on how healthcare pro-
viders involved intend to maintain and support 
the certified EHR technology over time; and 
‘‘(E) include a plan on how the healthcare 
providers involved intend to maintain and sup-
port the certified EHR technology that would 
be purchased with such loan, including the type 
of resources expected to be involved and any 
such other information as the State or Indian 
tribe, respectively, may require; and 
‘‘(5) agrees to provide matching funds in ac-
cordance with subsection (i). 
‘‘(c) ESTABLISHMENT OF FUND.—For purposes of 
subsection (b)(3), an eligible entity shall establish a cer-
tified EHR technology loan fund (referred to in this sub-
section as a ‘Loan Fund’) and comply with the other re-
quirements contained in this section. A grant to an eligible 
entity under this section shall be deposited in the Loan 
Fund established by the eligible entity. No funds author-
ized by other provisions of this title to be used for other 
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AMDT. NO. 570 
purposes specified in this title shall be deposited in any 
Loan Fund. 
‘‘(d) STRATEGIC PLAN.— 
‘‘(1) IN GENERAL.—For purposes of subsection 
(b)(2), a strategic plan of an eligible entity under 
this subsection shall identify the intended uses of 
amounts available to the Loan Fund of such entity. 
‘‘(2) CONTENTS.—A strategic plan under para-
graph (1), with respect to a Loan Fund of an eligi-
ble entity, shall include for a year the following: 
‘‘(A) A list of the projects to be assisted 
through the Loan Fund during such year. 
‘‘(B) A description of the criteria and 
methods established for the distribution of 
funds from the Loan Fund during the year. 
‘‘(C) A description of the financial status 
of the Loan Fund as of the date of submission 
of the plan. 
‘‘(D) The short-term and long-term goals 
of the Loan Fund. 
‘‘(e) USE OF FUNDS.—Amounts deposited in a Loan 
Fund, including loan repayments and interest earned on 
such amounts, shall be used only for awarding loans or 
loan guarantees, making reimbursements described in sub-
section (g)(4)(A), or as a source of reserve and security 
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AMDT. NO. 570 
for leveraged loans, the proceeds of which are deposited 
in the Loan Fund established under subsection (a). Loans 
under this section may be used by a health care provider 
to— 
‘‘(1) facilitate the purchase of certified EHR 
technology; 
‘‘(2) enhance the utilization of certified EHR 
technology (which may include costs associated with 
upgrading health information technology so that it 
meets criteria necessary to be a certified EHR tech-
nology); 
‘‘(3) train personnel in the use of such tech-
nology; or 
‘‘(4) improve the secure electronic exchange of 
health information. 
‘‘(f) TYPES OF ASSISTANCE.—Except as otherwise 
limited by applicable State law, amounts deposited into a 
Loan Fund under this subsection may only be used for 
the following: 
‘‘(1) To award loans that comply with the fol-
lowing: 
‘‘(A) The interest rate for each loan shall 
not exceed the market interest rate. 
‘‘(B) The principal and interest payments 
on each loan shall commence not later than 1 
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AMDT. NO. 570 
year after the date the loan was awarded, and 
each loan shall be fully amortized not later than 
10 years after the date of the loan. 
‘‘(C) The Loan Fund shall be credited with 
all payments of principal and interest on each 
loan awarded from the Loan Fund. 
‘‘(2) To guarantee, or purchase insurance for, 
a local obligation (all of the proceeds of which fi-
nance a project eligible for assistance under this 
subsection) if the guarantee or purchase would im-
prove credit market access or reduce the interest 
rate applicable to the obligation involved. 
‘‘(3) As a source of revenue or security for the 
payment of principal and interest on revenue or gen-
eral obligation bonds issued by the eligible entity if 
the proceeds of the sale of the bonds will be depos-
ited into the Loan Fund. 
‘‘(4) To earn interest on the amounts deposited 
into the Loan Fund. 
‘‘(5) To make reimbursements described in sub-
section (g)(4)(A). 
‘‘(g) ADMINISTRATION OF LOAN FUNDS.— 
‘‘(1) COMBINED FINANCIAL ADMINISTRATION.— 
An eligible entity may (as a convenience and to 
avoid unnecessary administrative costs) combine, in 
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AMDT. NO. 570 
accordance with applicable State law, the financial 
administration of a Loan Fund established under 
this subsection with the financial administration of 
any other revolving fund established by the entity if 
otherwise not prohibited by the law under which the 
Loan Fund was established. 
‘‘(2) COST OF ADMINISTERING FUND.—Each el-
igible entity may annually use not to exceed 4 per-
cent of the funds provided to the entity under a 
grant under this subsection to pay the reasonable 
costs of the administration of the programs under 
this section, including the recovery of reasonable 
costs expended to establish a Loan Fund which are 
incurred after the date of the enactment of this title. 
‘‘(3) GUIDANCE AND REGULATIONS.—The Na-
tional Coordinator shall publish guidance and pro-
mulgate regulations as may be necessary to carry 
out the provisions of this section, including— 
‘‘(A) provisions to ensure that each eligible 
entity commits and expends funds allotted to 
the entity under this subsection as efficiently as 
possible in accordance with this title and appli-
cable State laws; and 
‘‘(B) guidance to prevent waste, fraud, and 
abuse. 
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‘‘(4) PRIVATE SECTOR CONTRIBUTIONS.— 
‘‘(A) IN GENERAL.—A Loan Fund estab-
lished under this subsection may accept con-
tributions from private sector entities, except 
that such entities may not specify the recipient 
or recipients of any loan issued under this sub-
section. An eligible entity may agree to reim-
burse a private sector entity for any contribu-
tion made under this subparagraph, except that 
the amount of such reimbursement may not be 
greater than the principal amount of the con-
tribution made. 
‘‘(B) AVAILABILITY
OF
INFORMATION.— 
An eligible entity shall make publicly available 
the identity of, and amount contributed by, any 
private sector entity under subparagraph (A) 
and may issue letters of commendation or make 
other awards (that have no financial value) to 
any such entity. 
‘‘(h) MATCHING REQUIREMENTS.— 
‘‘(1) IN GENERAL.—The National Coordinator 
may not make a grant under subsection (a) to an el-
igible entity unless the entity agrees to make avail-
able (directly or through donations from public or 
private entities) non-Federal contributions in cash to 
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the costs of carrying out the activities for which the 
grant is awarded in an amount equal to not less 
than $1 for each $5 of Federal funds provided under 
the grant. 
‘‘(2) DETERMINATION
OF
AMOUNT
OF
NON- 
FEDERAL
CONTRIBUTION.—In 
determining 
the 
amount of non-Federal contributions that an eligible 
entity has provided pursuant to subparagraph (A), 
the National Coordinator may not include any 
amounts provided to the entity by the Federal Gov-
ernment. 
‘‘(i) EFFECTIVE DATE.—The Secretary may not 
make an award under this section prior to January 1, 
2010. 
‘‘SEC. 3015. DEMONSTRATION PROGRAM TO INTEGRATE IN-
FORMATION TECHNOLOGY INTO CLINICAL 
EDUCATION. 
‘‘(a) IN GENERAL.—The Secretary may award grants 
under this section to carry out demonstration projects to 
develop academic curricula integrating certified EHR 
technology in the clinical education of health professionals. 
Such awards shall be made on a competitive basis and 
pursuant to peer review. 
‘‘(b) ELIGIBILITY.—To be eligible to receive a grant 
under subsection (a), an entity shall— 
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‘‘(1) submit to the Secretary an application at 
such time, in such manner, and containing such in-
formation as the Secretary may require; 
‘‘(2) submit to the Secretary a strategic plan 
for integrating certified EHR technology in the clin-
ical education of health professionals to reduce med-
ical errors, increase access to prevention, reduce 
chronic diseases, and enhance health care quality; 
‘‘(3) be— 
‘‘(A) a school of medicine, osteopathic 
medicine, dentistry, or pharmacy, a graduate 
program in behavioral or mental health, or any 
other graduate health professions school; 
‘‘(B) a graduate school of nursing or phy-
sician assistant studies; 
‘‘(C) a consortium of two or more schools 
described in subparagraph (A) or (B); or 
‘‘(D) an institution with a graduate med-
ical education program in medicine, osteopathic 
medicine, dentistry, pharmacy, nursing, or phy-
sician assistance studies. 
‘‘(4) provide for the collection of data regarding 
the effectiveness of the demonstration project to be 
funded under the grant in improving the safety of 
patients, the efficiency of health care delivery, and 
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AMDT. NO. 570 
in increasing the likelihood that graduates of the 
grantee will adopt and incorporate certified EHR 
technology, in the delivery of health care services; 
and 
‘‘(5) provide matching funds in accordance with 
subsection (d). 
‘‘(c) USE OF FUNDS.— 
‘‘(1) IN GENERAL.—With respect to a grant 
under subsection (a), an eligible entity shall— 
‘‘(A) use grant funds in collaboration with 
2 or more disciplines; and 
‘‘(B) use grant funds to integrate certified 
EHR technology into community-based clinical 
education. 
‘‘(2) LIMITATION.—An eligible entity shall not 
use amounts received under a grant under sub-
section (a) to purchase hardware, software, or serv-
ices. 
‘‘(d) FINANCIAL SUPPORT.—The Secretary may not 
provide more than 50 percent of the costs of any activity 
for which assistance is provided under subsection (a), ex-
cept in an instance of national economic conditions which 
would render the cost-share requirement under this sub-
section detrimental to the program and upon notification 
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to Congress as to the justification to waive the cost-share 
requirement. 
‘‘(e) EVALUATION.—The Secretary shall take such 
action as may be necessary to evaluate the projects funded 
under this section and publish, make available, and dis-
seminate the results of such evaluations on as wide a basis 
as is practicable. 
‘‘(f) REPORTS.—Not later than 1 year after the date 
of enactment of this title, and annually thereafter, the Sec-
retary shall submit to the Committee on Health, Edu-
cation, Labor, and Pensions and the Committee on Fi-
nance of the Senate, and the Committee on Energy and 
Commerce of the House of Representatives a report 
that— 
‘‘(1) describes the specific projects established 
under this section; and 
‘‘(2) contains recommendations for Congress 
based on the evaluation conducted under subsection 
(e). 
‘‘SEC. 3016. INFORMATION TECHNOLOGY PROFESSIONALS 
ON HEALTH CARE. 
‘‘(a) IN GENERAL.—The Secretary, in consultation 
with the Director of the National Science Foundation, 
shall provide assistance to institutions of higher education 
(or consortia thereof) to establish or expand medical 
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AMDT. NO. 570 
health informatics education programs, including certifi-
cation, undergraduate, and masters degree programs, for 
both health care and information technology students to 
ensure the rapid and effective utilization and development 
of health information technologies (in the United States 
health care infrastructure). 
‘‘(b) ACTIVITIES.—Activities for which assistance 
may be provided under subsection (a) may include the fol-
lowing: 
‘‘(1) Developing and revising curricula in med-
ical health informatics and related disciplines. 
‘‘(2) Recruiting and retaining students to the 
program involved. 
‘‘(3) Acquiring equipment necessary for student 
instruction in these programs, including the installa-
tion of testbed networks for student use. 
‘‘(4) Establishing or enhancing bridge programs 
in the health informatics fields between community 
colleges and universities. 
‘‘(c) PRIORITY.—In providing assistance under sub-
section (a), the Secretary shall give preference to the fol-
lowing: 
‘‘(1) Existing education and training programs. 
‘‘(2) Programs designed to be completed in less 
than six months. 
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AMDT. NO. 570 
‘‘(d) FINANCIAL SUPPORT.—The Secretary may not 
provide more than 50 percent of the costs of any activity 
for which assistance is provided under subsection (a), ex-
cept in an instance of national economic conditions which 
would render the cost-share requirement under this sub-
section detrimental to the program and upon notification 
to Congress as to the justification to waive the cost-share 
requirement. 
‘‘SEC. 3017. GENERAL GRANT AND LOAN PROVISIONS. 
‘‘(a) REPORTS.—The Secretary may require that an 
entity receiving assistance under this title shall submit to 
the Secretary, not later than the date that is 1 year after 
the date of receipt of such assistance, a report that in-
cludes— 
‘‘(1) an analysis of the effectiveness of such ac-
tivities for which the entity receives such assistance, 
as compared to the goals for such activities; and 
‘‘(2) an analysis of the impact of the project on 
healthcare quality and safety. 
‘‘(b) REQUIREMENT TO IMPROVE QUALITY OF CARE 
AND DECREASE IN COSTS.—The National Coordinator 
shall annually evaluate the activities conducted under this 
title and shall, in awarding grants, implement the lessons 
learned from such evaluation in a manner so that awards 
made subsequent to each such evaluation are made in a 
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AMDT. NO. 570 
manner that, in the determination of the National Coordi-
nator, will result in the greatest improvement in the qual-
ity and efficiency of health care. 
‘‘SEC. 3018. AUTHORIZATION FOR APPROPRIATIONS. 
‘‘For the purposes of carrying out this subtitle, there 
is authorized to be appropriated such sums as may be nec-
essary for each of the fiscal years 2009 through 2013. 
Amounts so appropriated shall remain available until ex-
pended.’’. 
Subtitle D—Privacy 
SEC. 13400. DEFINITIONS. 
In this subtitle, except as specified otherwise: 
(1) BREACH.—The term ‘‘breach’’ means the 
unauthorized acquisition, access, use, or disclosure 
of protected health information which compromises 
the security, privacy, or integrity of protected health 
information maintained by or on behalf of a person. 
Such term does not include any unintentional acqui-
sition, access, use, or disclosure of such information 
by an employee or agent of the covered entity or 
business associate involved if such acquisition, ac-
cess, use, or disclosure, respectively, was made in 
good faith and within the course and scope of the 
employment or other contractual relationship of such 
employee or agent, respectively, with the covered en-
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AMDT. NO. 570 
tity or business associate and if such information is 
not further acquired, accessed, used, or disclosed by 
such employee or agent. 
(2) BUSINESS ASSOCIATE.—The term ‘‘business 
associate’’ has the meaning given such term in sec-
tion 160.103 of title 45, Code of Federal Regula-
tions. 
(3) COVERED ENTITY.—The term ‘‘covered en-
tity’’ has the meaning given such term in section 
160.103 of title 45, Code of Federal Regulations. 
(4) DISCLOSE.—The terms ‘‘disclose’’ and ‘‘dis-
closure’’ have the meaning given the term ‘‘disclo-
sure’’ in section 160.103 of title 45, Code of Federal 
Regulations. 
(5) ELECTRONIC HEALTH RECORD.—The term 
‘‘electronic health record’’ means an electronic 
record of health-related information on an individual 
that is created, gathered, managed, and consulted by 
authorized health care clinicians and staff. 
(6) HEALTH
CARE
OPERATIONS.—The term 
‘‘health care operation’’ has the meaning given such 
term in section 164.501 of title 45, Code of Federal 
Regulations. 
(7) HEALTH
CARE
PROVIDER.—The term 
‘‘health care provider’’ has the meaning given such 
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AMDT. NO. 570 
term in section 160.103 of title 45, Code of Federal 
Regulations. 
(8) HEALTH PLAN.—The term ‘‘health plan’’ 
has the meaning given such term in section 1171(5) 
of the Social Security Act. 
(9) NATIONAL COORDINATOR.—The term ‘‘Na-
tional Coordinator’’ means the head of the Office of 
the National Coordinator for Health Information 
Technology established under section 3001(a) of the 
Public Health Service Act, as added by section 
13101. 
(10) PAYMENT.—The term ‘‘payment’’ has the 
meaning given such term in section 164.501 of title 
45, Code of Federal Regulations. 
(11) PERSONAL HEALTH RECORD.—The term 
‘‘personal health record’’ means an electronic record 
of individually identifiable health information on an 
individual that can be drawn from multiple sources 
and that is managed, shared, and controlled by or 
for the individual. 
(12) PROTECTED HEALTH INFORMATION.—The 
term ‘‘protected health information’’ has the mean-
ing given such term in section 160.103 of title 45, 
Code of Federal Regulations. 
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AMDT. NO. 570 
(13) 
SECRETARY.—The 
term 
‘‘Secretary’’ 
means the Secretary of Health and Human Services. 
(14) SECURITY.—The term ‘‘security’’ has the 
meaning given such term in section 164.304 of title 
45, Code of Federal Regulations. 
(15) STATE.—The term ‘‘State’’ means each of 
the several States, the District of Columbia, Puerto 
Rico, the Virgin Islands, Guam, American Samoa, 
and the Northern Mariana Islands. 
(16) TREATMENT.—The term ‘‘treatment’’ has 
the meaning given such term in section 164.501 of 
title 45, Code of Federal Regulations. 
(17) USE.—The term ‘‘use’’ has the meaning 
given such term in section 160.103 of title 45, Code 
of Federal Regulations. 
(18) 
VENDOR
OF
PERSONAL
HEALTH 
RECORDS.—The term ‘‘vendor of personal health 
records’’ means an entity, other than a covered enti-
ty (as defined in paragraph (3)), that offers or 
maintains a personal health record. 
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AMDT. NO. 570 
PART I—IMPROVED PRIVACY PROVISIONS AND 
SECURITY PROVISIONS 
SEC. 13401. APPLICATION OF SECURITY PROVISIONS AND 
PENALTIES TO BUSINESS ASSOCIATES OF 
COVERED ENTITIES; ANNUAL GUIDANCE ON 
SECURITY PROVISIONS. 
(a) APPLICATION OF SECURITY PROVISIONS.—Sec-
tions 164.308, 164.310, 164.312, and 164.316 of title 45, 
Code of Federal Regulations, shall apply to a business as-
sociate of a covered entity in the same manner that such 
sections apply to the covered entity. The additional re-
quirements of this title that relate to security and that 
are made applicable with respect to covered entities shall 
also be applicable to such a business associate and shall 
be incorporated into the business associate agreement be-
tween the business associate and the covered entity. 
(b) APPLICATION
OF CIVIL
AND CRIMINAL PEN-
ALTIES.—In the case of a business associate that violates 
any security provision specified in subsection (a), sections 
1176 and 1177 of the Social Security Act (42 U.S.C. 
1320d–5, 1320d–6) shall apply to the business associate 
with respect to such violation in the same manner such 
sections apply to a covered entity that violates such secu-
rity provision. 
(c) ANNUAL GUIDANCE.—For the first year begin-
ning after the date of the enactment of this Act and annu-
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ally thereafter, the Secretary of Health and Human Serv-
ices shall, in consultation with industry stakeholders, an-
nually issue guidance on the most effective and appro-
priate technical safeguards for use in carrying out the sec-
tions referred to in subsection (a) and the security stand-
ards in subpart C of part 164 of title 45, Code of Federal 
Regulations, as such provisions are in effect as of the date 
before the enactment of this Act. 
SEC. 13402. NOTIFICATION IN THE CASE OF BREACH. 
(a) IN GENERAL.—A covered entity that accesses, 
maintains, retains, modifies, records, stores, destroys, or 
otherwise holds, uses, or discloses unsecured protected 
health information (as defined in subsection (h)(1)) shall, 
in the case of a breach of such information that is discov-
ered by the covered entity, notify each individual whose 
unsecured protected health information has been, or is 
reasonably believed by the covered entity to have been, 
accessed, acquired, or disclosed as a result of such breach. 
(b) NOTIFICATION OF COVERED ENTITY BY BUSI-
NESS ASSOCIATE.—A business associate of a covered enti-
ty that accesses, maintains, retains, modifies, records, 
stores, destroys, or otherwise holds, uses, or discloses un-
secured protected health information shall, following the 
discovery of a breach of such information, notify the cov-
ered entity of such breach. Such notice shall include the 
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AMDT. NO. 570 
identification of each individual whose unsecured protected 
health information has been, or is reasonably believed by 
the business associate to have been, accessed, acquired, 
or disclosed during such breach. 
(c) BREACHES TREATED AS DISCOVERED.—For pur-
poses of this section, a breach shall be treated as discov-
ered by a covered entity or by a business associate as of 
the first day on which such breach is known to such entity 
or associate, respectively, (including any person, other 
than the individual committing the breach, that is an em-
ployee, officer, or other agent of such entity or associate, 
respectively) or should reasonably have been known to 
such entity or associate (or person) to have occurred. 
(d) TIMELINESS OF NOTIFICATION.— 
(1) IN GENERAL.—Subject to subsection (g), all 
notifications required under this section shall be 
made without unreasonable delay and in no case 
later than 60 calendar days after the discovery of a 
breach by the covered entity involved (or business 
associate involved in the case of a notification re-
quired under subsection (b)). 
(2) BURDEN OF PROOF.—The covered entity in-
volved (or business associate involved in the case of 
a notification required under subsection (b)), shall 
have the burden of demonstrating that all notifica-
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AMDT. NO. 570 
tions were made as required under this part, includ-
ing evidence demonstrating the necessity of any 
delay. 
(e) METHODS OF NOTICE.— 
(1) 
INDIVIDUAL
NOTICE.—Notice 
required 
under this section to be provided to an individual, 
with respect to a breach, shall be provided promptly 
and in the following form: 
(A) Written notification by first-class mail 
to the individual (or the next of kin of the indi-
vidual if the individual is deceased) at the last 
known address of the individual or the next of 
kin, respectively, or, if specified as a preference 
by the individual, by electronic mail. The notifi-
cation may be provided in one or more mailings 
as information is available. 
(B) In the case in which there is insuffi-
cient, or out-of-date contact information (in-
cluding a phone number, email address, or any 
other form of appropriate communication) that 
precludes direct written (or, if specified by the 
individual under subparagraph (A), electronic) 
notification to the individual, a substitute form 
of notice shall be provided, including, in the 
case that there are 10 or more individuals for 
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AMDT. NO. 570 
which there is insufficient or out-of-date contact 
information, a conspicuous posting for a period 
determined by the Secretary on the home page 
of the Web site of the covered entity involved or 
notice in major print or broadcast media, in-
cluding major media in geographic areas where 
the individuals affected by the breach likely re-
side. Such a notice in media or web posting will 
include a toll-free phone number where an indi-
vidual can learn whether or not the individual’s 
unsecured protected health information is pos-
sibly included in the breach. 
(C) In any case deemed by the covered en-
tity involved to require urgency because of pos-
sible imminent misuse of unsecured protected 
health information, the covered entity, in addi-
tion to notice provided under subparagraph (A), 
may provide information to individuals by tele-
phone or other means, as appropriate. 
(2) MEDIA NOTICE.—Notice shall be provided 
to prominent media outlets serving a State or juris-
diction, following the discovery of a breach described 
in subsection (a), if the unsecured protected health 
information of more than 500 residents of such 
State or jurisdiction is, or is reasonably believed to 
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AMDT. NO. 570 
have been, accessed, acquired, or disclosed during 
such breach. 
(3) NOTICE TO SECRETARY.—Notice shall be 
provided to the Secretary by covered entities of un-
secured protected health information that has been 
acquired or disclosed in a breach. If the breach was 
with respect to 500 or more individuals than such 
notice must be provided immediately. If the breach 
was with respect to less than 500 individuals, the 
covered entity may maintain a log of any such 
breach occurring and annually submit such a log to 
the Secretary documenting such breaches occurring 
during the year involved. 
(4) POSTING ON HHS PUBLIC WEBSITE.—The 
Secretary shall make available to the public on the 
Internet website of the Department of Health and 
Human Services a list that identifies each covered 
entity involved in a breach described in subsection 
(a) in which the unsecured protected health informa-
tion of more than 500 individuals is acquired or dis-
closed. 
(f) CONTENT OF NOTIFICATION.—Regardless of the 
method by which notice is provided to individuals under 
this section, notice of a breach shall include, to the extent 
possible, the following: 
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(1) A brief description of what happened, in-
cluding the date of the breach and the date of the 
discovery of the breach, if known. 
(2) A description of the types of unsecured pro-
tected health information that were involved in the 
breach (such as full name, Social Security number, 
date of birth, home address, account number, or dis-
ability code). 
(3) The steps individuals should take to protect 
themselves from potential harm resulting from the 
breach. 
(4) A brief description of what the covered enti-
ty involved is doing to investigate the breach, to 
mitigate losses, and to protect against any further 
breaches. 
(5) Contact procedures for individuals to ask 
questions or learn additional information, which 
shall include a toll-free telephone number, an e-mail 
address, Web site, or postal address. 
(g) DELAY OF NOTIFICATION AUTHORIZED FOR LAW 
ENFORCEMENT PURPOSES.—If a law enforcement official 
determines that a notification, notice, or posting required 
under this section would impede a criminal investigation 
or cause damage to national security, such notification, 
notice, or posting shall be delayed in the same manner 
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AMDT. NO. 570 
as provided under section 164.528(a)(2) of title 45, Code 
of Federal Regulations, in the case of a disclosure covered 
under such section. 
(h) UNSECURED PROTECTED HEALTH INFORMA-
TION.— 
(1) DEFINITION.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), for purposes of this section, the 
term ‘‘unsecured protected health information’’ 
means protected health information that is not 
secured through the use of a technology or 
methodology specified by the Secretary in the 
guidance issued under paragraph (2). 
(B) EXCEPTION
IN
CASE
TIMELY
GUID-
ANCE NOT ISSUED.—In the case that the Sec-
retary does not issue guidance under paragraph 
(2) by the date specified in such paragraph, for 
purposes of this section, the term ‘‘unsecured 
protected health information’’ shall mean pro-
tected health information that is not secured by 
a technology standard that renders protected 
health information unusable, unreadable, or in-
decipherable to unauthorized individuals and is 
developed or endorsed by a standards devel-
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AMDT. NO. 570 
oping organization that is accredited by the 
American National Standards Institute. 
(2) GUIDANCE.—For purposes of paragraph (1) 
and section 13407(f)(3), not later than the date that 
is 60 days after the date of the enactment of this 
Act, the Secretary shall, after consultation with 
stakeholders, issue (and annually update) guidance 
specifying the technologies and methodologies that 
render 
protected 
health 
information 
unusable, 
unreadable, or indecipherable to unauthorized indi-
viduals. 
(i) REPORT TO CONGRESS ON BREACHES.— 
(1) IN GENERAL.—Not later than 12 months 
after the date of the enactment of this Act and an-
nually thereafter, the Secretary shall prepare and 
submit to the Committee on Finance and the Com-
mittee on Health, Education, Labor, and Pensions 
of the Senate and the Committee on Ways and 
Means and the Committee on Energy and Commerce 
of the House of Representatives a report containing 
the information described in paragraph (2) regard-
ing breaches for which notice was provided to the 
Secretary under subsection (e)(3). 
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(2) INFORMATION.—The information described 
in this paragraph regarding breaches specified in 
paragraph (1) shall include— 
(A) the number and nature of such 
breaches; and 
(B) actions taken in response to such 
breaches. 
(j) REGULATIONS; EFFECTIVE DATE.—To carry out 
this section, the Secretary of Health and Human Services 
shall promulgate interim final regulations by not later 
than the date that is 180 days after the date of the enact-
ment of this title. The provisions of this section shall apply 
to breaches that are discovered on or after the date that 
is 30 days after the date of publication of such interim 
final regulations. 
SEC. 13403. EDUCATION ON HEALTH INFORMATION PRI-
VACY. 
(a) REGIONAL OFFICE PRIVACY ADVISORS.—Not 
later than 6 months after the date of the enactment of 
this Act, the Secretary shall designate an individual in 
each regional office of the Department of Health and 
Human Services to offer guidance and education to cov-
ered entities, business associates, and individuals on their 
rights and responsibilities related to Federal privacy and 
security requirements for protected health information. 
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AMDT. NO. 570 
(b) EDUCATION INITIATIVE ON USES OF HEALTH IN-
FORMATION.—Not later than 12 months after the date of 
the enactment of this Act, the Office for Civil Rights with-
in the Department of Health and Human Services shall 
develop and maintain a multi-faceted national education 
initiative to enhance public transparency regarding the 
uses of protected health information, including programs 
to educate individuals about the potential uses of their 
protected health information, the effects of such uses, and 
the rights of individuals with respect to such uses. Such 
programs shall be conducted in a variety of languages and 
present information in a clear and understandable man-
ner. 
SEC. 13404. APPLICATION OF PRIVACY PROVISIONS AND 
PENALTIES TO BUSINESS ASSOCIATES OF 
COVERED ENTITIES. 
(a) APPLICATION OF CONTRACT REQUIREMENTS.— 
In the case of a business associate of a covered entity that 
obtains or creates protected health information pursuant 
to a written contract (or other written arrangement) de-
scribed in section 164.502(e)(2) of title 45, Code of Fed-
eral Regulations, with such covered entity, the business 
associate may use and disclose such protected health infor-
mation only if such use or disclosure, respectively, is in 
compliance with each applicable requirement of section 
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AMDT. NO. 570 
164.504(e) of such title. The additional requirements of 
this subtitle that relate to privacy and that are made ap-
plicable with respect to covered entities shall also be appli-
cable to such a business associate and shall be incor-
porated into the business associate agreement between the 
business associate and the covered entity. 
(b) APPLICATION OF KNOWLEDGE ELEMENTS ASSO-
CIATED WITH CONTRACTS.—Section 164.504(e)(1)(ii) of 
title 45, Code of Federal Regulations, shall apply to a 
business associate described in subsection (a), with respect 
to compliance with such subsection, in the same manner 
that such section applies to a covered entity, with respect 
to compliance with the standards in sections 164.502(e) 
and 164.504(e) of such title, except that in applying such 
section 164.504(e)(1)(ii) each reference to the business as-
sociate, with respect to a contract, shall be treated as a 
reference to the covered entity involved in such contract. 
(c) APPLICATION
OF CIVIL
AND CRIMINAL PEN-
ALTIES.—In the case of a business associate that violates 
any provision of subsection (a) or (b), the provisions of 
sections 1176 and 1177 of the Social Security Act (42 
U.S.C. 1320d–5, 1320d–6) shall apply to the business as-
sociate with respect to such violation in the same manner 
as such provisions apply to a person who violates a provi-
sion of part C of title XI of such Act. 
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AMDT. NO. 570 
SEC. 13405. RESTRICTIONS ON CERTAIN DISCLOSURES AND 
SALES OF HEALTH INFORMATION; ACCOUNT-
ING OF CERTAIN PROTECTED HEALTH IN-
FORMATION DISCLOSURES; ACCESS TO CER-
TAIN INFORMATION IN ELECTRONIC FOR-
MAT. 
(a) REQUESTED RESTRICTIONS ON CERTAIN DIS-
CLOSURES OF HEALTH INFORMATION.—In the case that 
an individual requests under paragraph (a)(1)(i)(A) of 
section 164.522 of title 45, Code of Federal Regulations, 
that a covered entity restrict the disclosure of the pro-
tected health information of the individual, notwith-
standing paragraph (a)(1)(ii) of such section, the covered 
entity must comply with the requested restriction if— 
(1) except as otherwise required by law, the dis-
closure is to a health plan for purposes of carrying 
out payment or health care operations (and is not 
for purposes of carrying out treatment); and 
(2) the protected health information pertains 
solely to a health care item or service for which the 
health care provider involved has been paid out of 
pocket in full. 
(b) DISCLOSURES REQUIRED TO BE LIMITED TO 
THE
LIMITED
DATA
SET
OR
THE
MINIMUM
NEC-
ESSARY.— 
(1) IN GENERAL.— 
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333 
AMDT. NO. 570 
(A) IN
GENERAL.—Subject to subpara-
graph (B), a covered entity shall be treated as 
being in compliance with section 164.502(b)(1) 
of title 45, Code of Federal Regulations, with 
respect to the use, disclosure, or request of pro-
tected health information described in such sec-
tion, only if the covered entity limits such pro-
tected health information, to the extent prac-
ticable, to the limited data set (as defined in 
section 164.514(e)(2) of such title) or, if needed 
by such entity, to the minimum necessary to ac-
complish the intended purpose of such use, dis-
closure, or request, respectively. 
(B) 
GUIDANCE.—Not 
later 
than 
months after the date of the enactment of this 
section, the Secretary shall issue guidance on 
what constitutes ‘‘minimum necessary’’ for pur-
poses of subpart E of part 164 of title 45, Code 
of Federal Regulation. In issuing such guidance 
the Secretary shall take into consideration the 
guidance under section 13424(c) and the infor-
mation necessary to improve patient outcomes 
and to detect, prevent, and manage chronic dis-
ease. 
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334 
AMDT. NO. 570 
(C) SUNSET.—Subparagraph (A) shall not 
apply on and after the effective date on which 
the Secretary issues the guidance under sub-
paragraph (B). 
(2) 
DETERMINATION
OF
MINIMUM
NEC-
ESSARY.—For purposes of paragraph (1), in the 
case of the disclosure of protected health informa-
tion, the covered entity or business associate dis-
closing such information shall determine what con-
stitutes the minimum necessary to accomplish the 
intended purpose of such disclosure. 
(3) APPLICATION OF EXCEPTIONS.—The excep-
tions described in section 164.502(b)(2) of title 45, 
Code of Federal Regulations, shall apply to the re-
quirement under paragraph (1) as of the effective 
date described in section 13423 in the same manner 
that such exceptions apply to section 164.502(b)(1) 
of such title before such date. 
(4) RULE OF CONSTRUCTION.—Nothing in this 
subsection shall be construed as affecting the use, 
disclosure, or request of protected health information 
that has been de-identified. 
(c) ACCOUNTING OF CERTAIN PROTECTED HEALTH 
INFORMATION DISCLOSURES REQUIRED IF COVERED EN-
TITY USES ELECTRONIC HEALTH RECORD.— 
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335 
AMDT. NO. 570 
‘‘(1) 
IN
GENERAL.—In 
applying 
section 
164.528 of title 45, Code of Federal Regulations, in 
the case that a covered entity uses or maintains an 
electronic health record with respect to protected 
health information— 
‘‘(A) 
the 
exception 
under 
paragraph 
(a)(1)(i) of such section shall not apply to dis-
closures through an electronic health record 
made by such entity of such information; and 
‘‘(B) an individual shall have a right to re-
ceive an accounting of disclosures described in 
such paragraph of such information made by 
such covered entity during only the three years 
prior to the date on which the accounting is re-
quested. 
‘‘(2) REGULATIONS.—The Secretary shall pro-
mulgate regulations on what disclosures must be in-
cluded in an accounting referred to in paragraph 
(1)(A) and what information must be collected about 
each such disclosure not later than 18 months after 
the date on which the Secretary adopts standards on 
accounting for disclosure described in the section 
3002(b)(2)(B)(iv) of the Public Health Service Act, 
as added by section 13101. Such regulations shall 
only require such information to be collected through 
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336 
AMDT. NO. 570 
an electronic health record in a manner that takes 
into account the interests of individuals in learning 
when their protected health information was dis-
closed and to whom it was disclosed, and the useful-
ness of such information to the individual, and takes 
into account the administrative and cost burden of 
accounting for such disclosures. 
‘‘(3) CONSTRUCTION.—Nothing in this sub-
section shall be construed as— 
‘‘(A) requiring a covered entity to account 
for disclosures of protected health information 
that are not made by such covered entity; or 
‘‘(B) requiring a business associate of a 
covered entity to account for disclosures of pro-
tected health information that are not made by 
such business associate. 
‘‘(4) REASONABLE FEE.—A covered entity may 
impose a reasonable fee on an individual for an ac-
counting performed under paragraph (1)(B). Any 
such fee shall not be greater than the entity’s labor 
costs in responding to the request. 
‘‘(5) EFFECTIVE DATE.— 
‘‘(A) CURRENT
USERS
OF
ELECTRONIC 
RECORDS.—In the case of a covered entity inso-
far as it acquired an electronic health record as 
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337 
AMDT. NO. 570 
of January 1, 2009, paragraph (1) shall apply 
to disclosures, with respect to protected health 
information, made by the covered entity from 
such a record on and after January 1, 2014. 
‘‘(B) OTHERS.—In the case of a covered 
entity insofar as it acquires an electronic health 
record after January 1, 2009, paragraph (1) 
shall apply to disclosures, with respect to pro-
tected health information, made by the covered 
entity from such record on and after the later 
of the following: 
‘‘(i) January 1, 2011; or 
‘‘(ii) the date that it acquires an elec-
tronic health record. 
‘‘(C) LATER
DATE.—The Secretary may 
set an effective date that is later that the date 
specified under subparagraph (A) or (B) if the 
Secretary determines that such later date it 
necessary, but in no case may the date specified 
under— 
‘‘(i) subparagraph (A) be later than 
2018; or 
‘‘(ii) subparagraph (B) be later than 
2014. 
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338 
AMDT. NO. 570 
(d) REVIEW OF HEALTH CARE OPERATIONS.—Not 
later than 18 months after the date of the enactment of 
this title, the Secretary shall review and evaluate the defi-
nition of health care operations under section 164.501 of 
title 45, Code of Federal Regulations, and to the extent 
appropriate, eliminate by regulation activities that can 
reasonably and efficiently be conducted through the use 
of information that is de-identified (in accordance with the 
requirements of section 164.514(b) of such title) or that 
should require a valid authorization for use or disclosure. 
In promulgating such regulations, the Secretary shall not 
require that data be de-identified or require valid author-
ization for use or disclosure for activities within a covered 
entity described in paragraph (1) of the definition of 
health care operations under such section 164.501. In pro-
mulgating such regulations, the Secretary may choose to 
narrow or clarify activities that the Secretary chooses to 
retain in the definition of health care operations and the 
Secretary shall take into account the report under section 
13424(d). In such regulations the Secretary shall specify 
the date on which such regulations shall apply to disclo-
sures made by a covered entity, but in no case would such 
date be sooner than the date that is 24 months after the 
date of the enactment of this section. Nothing in this sub-
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339 
AMDT. NO. 570 
section may be construed to supersede any provision under 
subsection (e) or section 13406(a). 
(e) PROHIBITION ON SALE OF ELECTRONIC HEALTH 
RECORDS OR PROTECTED HEALTH INFORMATION OB-
TAINED FROM ELECTRONIC HEALTH RECORDS.— 
(1) IN GENERAL.—Except as provided in para-
graph (2), a covered entity or business associate 
shall not directly or indirectly receive remuneration 
in exchange for any protected health information of 
an individual unless the covered entity obtained from 
the individual, in accordance with section 164.508 of 
title 45, Code of Federal Regulations, a valid au-
thorization that includes, in accordance with such 
section, a specification of whether the protected 
health information can be further exchanged for re-
muneration by the entity receiving protected health 
information of that individual. 
(2) EXCEPTIONS.—Paragraph (1) shall not 
apply in the following cases: 
(A) The purpose of the exchange is for re-
search or public health activities (as described 
in sections 164.501, 164.512(i), and 164.512(b) 
of title 45, Code of Federal Regulations). 
(B) The purpose of the exchange is for the 
treatment of the individual, subject to any regu-
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340 
AMDT. NO. 570 
lation that the Secretary may promulgate to 
prevent protected health information from inap-
propriate access, use, or disclosure. 
(C) The purpose of the exchange is the 
health care operation specifically described in 
subparagraph (iv) of paragraph (6) of the defi-
nition of healthcare operations in section 
164.501 of title 45, Code of Federal Regula-
tions. 
(D) The purpose of the exchange is for re-
muneration that is provided by a covered entity 
to a business associate for activities involving 
the exchange of protected health information 
that the business associate undertakes on behalf 
of and at the specific request of the covered en-
tity pursuant to a business associate agreement. 
(E) The purpose of the exchange is to pro-
vide an individual with a copy of the individ-
ual’s protected health information pursuant to 
section 164.524 of title 45, Code of Federal 
Regulations. 
(F) The purpose of the exchange is other-
wise determined by the Secretary in regulations 
to be similarly necessary and appropriate as the 
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341 
AMDT. NO. 570 
exceptions provided in subparagraphs (A) 
through (E). 
(3) REGULATIONS.—Not later than 18 months 
after the date of enactment of this title, the Sec-
retary shall promulgate regulations to carry out this 
subsection. In promulgating such regulations, the 
Secretary— 
(A) shall evaluate the impact of restricting 
the exception described in paragraph (2)(A) to 
require that the price charged for the purposes 
described in such paragraph reflects the costs 
of the preparation and transmittal of the data 
for such purpose, on research or public health 
activities, including those conducted by or for 
the use of the Food and Drug Administration; 
and 
(B) may further restrict the exception de-
scribed in paragraph (2)(A) to require that the 
price charged for the purposes described in 
such paragraph reflects the costs of the prepa-
ration and transmittal of the data for such pur-
pose, if the Secretary finds that such further 
restriction will not impede such research or 
public health activities. 
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AMDT. NO. 570 
(4) EFFECTIVE
DATE.—Paragraph (1) shall 
apply to exchanges occurring on or after the date 
that is 6 months after the date of the promulgation 
of final regulations implementing this subsection. 
(f) ACCESS TO CERTAIN INFORMATION IN ELEC-
TRONIC FORMAT.—In applying section 164.524 of title 
45, Code of Federal Regulations, in the case that a cov-
ered entity uses or maintains an electronic health record 
with respect to protected health information of an indi-
vidual— 
(1) the individual shall have a right to obtain 
from such covered entity a copy of such information 
in an electronic format; and 
(2) notwithstanding paragraph (c)(4) of such 
section, any fee that the covered entity may impose 
for providing such individual with a copy of such in-
formation (or a summary or explanation of such in-
formation) if such copy (or summary or explanation) 
is in an electronic form shall not be greater than the 
entity’s labor costs in responding to the request for 
the copy (or summary or explanation). 
SEC. 13406. CONDITIONS ON CERTAIN CONTACTS AS PART 
OF HEALTH CARE OPERATIONS. 
(a) MARKETING.— 
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343 
AMDT. NO. 570 
(1) IN GENERAL.—A communication by a cov-
ered entity or business associate that is about a 
product or service and that encourages recipients of 
the communication to purchase or use the product 
or service shall not be considered a health care oper-
ation for purposes of subpart E of part 164 of title 
45, Code of Federal Regulations, unless the commu-
nication is made as described in subparagraph (i), 
(ii), or (iii) of paragraph (1) of the definition of 
marketing in section 164.501 of such title. 
(2) 
PAYMENT
FOR
CERTAIN
COMMUNICA-
TIONS.—A communication by a covered entity or 
business associate that is described in subparagraph 
(i), (ii), or (iii) of paragraph (1) of the definition of 
marketing in section 164.501 of title 45, Code of 
Federal Regulations, shall not be considered a health 
care operation for purposes of subpart E of part 164 
of title 45, Code of Federal Regulations if the cov-
ered entity receives or has received direct or indirect 
payment in exchange for making such communica-
tion, except where— 
(A) such communication describes only a 
health care item or service that has previously 
been prescribed for or administered to the re-
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344 
AMDT. NO. 570 
cipient of the communication, or a family mem-
ber of such recipient; 
(B) each of the following conditions 
apply— 
(i) the communication is made by the 
covered entity; and 
(ii) the covered entity making such 
communication obtains from the recipient 
of the communication, in accordance with 
section 164.508 of title 45, Code of Fed-
eral Regulations, a valid authorization (as 
described in paragraph (b) of such section) 
with respect to such communication; or 
(C) each of the following conditions 
apply— 
(i) the communication is made on be-
half of the covered entity; 
(ii) the communication is consistent 
with the written contract (or other written 
arrangement 
described 
in 
section 
164.502(e)(2) of such title) between such 
business associate and covered entity; and 
(iii) the business associate making 
such communication, or the covered entity 
on behalf of which the communication is 
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345 
AMDT. NO. 570 
made, obtains from the recipient of the 
communication, in accordance with section 
164.508 of title 45, Code of Federal Regu-
lations, a valid authorization (as described 
in paragraph (b) of such section) with re-
spect to such communication. 
(c) EFFECTIVE DATE.—This section shall apply to 
contracting occurring on or after the effective date speci-
fied under section 13423. 
SEC. 13407. TEMPORARY BREACH NOTIFICATION REQUIRE-
MENT FOR VENDORS OF PERSONAL HEALTH 
RECORDS AND OTHER NON-HIPAA COVERED 
ENTITIES. 
(a) IN GENERAL.—In accordance with subsection (c), 
each vendor of personal health records, following the dis-
covery of a breach of security of unsecured PHR identifi-
able health information that is in a personal health record 
maintained or offered by such vendor, and each entity de-
scribed in clause (ii) or (iii) of section 13424(b)(1)(A), fol-
lowing the discovery of a breach of security of such infor-
mation that is obtained through a product or service pro-
vided by such entity, shall— 
(1) notify each individual who is a citizen or 
resident of the United States whose unsecured PHR 
identifiable health information was acquired by an 
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346 
AMDT. NO. 570 
unauthorized person as a result of such a breach of 
security; and 
(2) notify the Federal Trade Commission. 
(b) NOTIFICATION BY THIRD PARTY SERVICE PRO-
VIDERS.—A third party service provider that provides 
services to a vendor of personal health records or to an 
entity described in clause (ii) or (iii) of section 
13424(b)(1)(A) in connection with the offering or mainte-
nance of a personal health record or a related product or 
service and that accesses, maintains, retains, modifies, 
records, stores, destroys, or otherwise holds, uses, or dis-
closes unsecured PHR identifiable health information in 
such a record as a result of such services shall, following 
the discovery of a breach of security of such information, 
notify such vendor or entity, respectively, of such breach. 
Such notice shall include the identification of each indi-
vidual whose unsecured PHR identifiable health informa-
tion has been, or is reasonably believed to have been, 
accessed, acquired, or disclosed during such breach. 
(c) APPLICATION OF REQUIREMENTS FOR TIMELI-
NESS, METHOD, AND CONTENT
OF NOTIFICATIONS.— 
Subsections (c), (d), (e), and (f) of section 13402 shall 
apply to a notification required under subsection (a) and 
a vendor of personal health records, an entity described 
in subsection (a) and a third party service provider de-
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347 
AMDT. NO. 570 
scribed in subsection (b), with respect to a breach of secu-
rity under subsection (a) of unsecured PHR identifiable 
health information in such records maintained or offered 
by such vendor, in a manner specified by the Federal 
Trade Commission. 
(d) NOTIFICATION OF THE SECRETARY.—Upon re-
ceipt of a notification of a breach of security under sub-
section (a)(2), the Federal Trade Commission shall notify 
the Secretary of such breach. 
(e) ENFORCEMENT.—A violation of subsection (a) or 
(b) shall be treated as an unfair and deceptive act or prac-
tice in violation of a regulation under section 18(a)(1)(B) 
of the Federal Trade Commission Act (15 U.S.C. 
57a(a)(1)(B)) regarding unfair or deceptive acts or prac-
tices. 
(f) DEFINITIONS.—For purposes of this section: 
(1) BREACH OF SECURITY.—The term ‘‘breach 
of security’’ means, with respect to unsecured PHR 
identifiable health information of an individual in a 
personal health record, acquisition of such informa-
tion without the authorization of the individual. 
(2) PHR
IDENTIFIABLE
HEALTH
INFORMA-
TION.—The term ‘‘PHR identifiable health informa-
tion’’ means individually identifiable health informa-
tion, as defined in section 1171(6) of the Social Se-
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AMDT. NO. 570 
curity Act (42 U.S.C. 1320d(6)), and includes, with 
respect to an individual, information— 
(A) that is provided by or on behalf of the 
individual; and 
(B) that identifies the individual or with 
respect to which there is a reasonable basis to 
believe that the information can be used to 
identify the individual. 
(3) UNSECURED
PHR
IDENTIFIABLE
HEALTH 
INFORMATION.— 
(A) IN
GENERAL.—Subject to subpara-
graph (B), the term ‘‘unsecured PHR identifi-
able health information’’ means PHR identifi-
able health information that is not protected 
through the use of a technology or methodology 
specified by the Secretary in the guidance 
issued under section 13402(h)(2). 
(B) EXCEPTION
IN
CASE
TIMELY
GUID-
ANCE NOT ISSUED.—In the case that the Sec-
retary does not issue guidance under section 
13402(h)(2) by the date specified in such sec-
tion, for purposes of this section, the term ‘‘un-
secured PHR identifiable health information’’ 
shall mean PHR identifiable health information 
that is not secured by a technology standard 
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349 
AMDT. NO. 570 
that renders protected health information unus-
able, unreadable, or indecipherable to unauthor-
ized individuals and that is developed or en-
dorsed by a standards developing organization 
that is accredited by the American National 
Standards Institute. 
(g) REGULATIONS; EFFECTIVE DATE; SUNSET.— 
(1) 
REGULATIONS; 
EFFECTIVE
DATE.—To 
carry out this section, the Federal Trade Commis-
sion shall, in accordance with section 553 of title 5, 
United States Code, promulgate interim final regula-
tions by not later than the date that is 180 days 
after the date of the enactment of this section. The 
provisions of this section shall apply to breaches of 
security that are discovered on or after the date that 
is 30 days after the date of publication of such in-
terim final regulations. 
(2) SUNSET.—The provisions of this section 
shall not apply to breaches of security occurring on 
or after the earlier of the following the dates: 
(A) The date on which a standard relating 
to requirements for entities that are not covered 
entities that includes requirements relating to 
breach notification has been promulgated by the 
Secretary. 
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AMDT. NO. 570 
(B) The date on which a standard relating 
to requirements for entities that are not covered 
entities that includes requirements relating to 
breach notification has been promulgated by the 
Federal Trade Commission and has taken ef-
fect. 
SEC. 13408. BUSINESS ASSOCIATE CONTRACTS REQUIRED 
FOR CERTAIN ENTITIES. 
Each organization, with respect to a covered entity, 
that provides data transmission of protected health infor-
mation to such entity (or its business associate) and that 
requires access on a routine basis to such protected health 
information, such as a Health Information Exchange Or-
ganization, Regional Health Information Organization, E- 
prescribing Gateway, or each vendor that contracts with 
a covered entity to allow that covered entity to offer a per-
sonal health record to patients as part of its electronic 
health record, is required to enter into a written contract 
(or other written arrangement) described in section 
164.502(e)(2) of title 45, Code of Federal Regulations and 
a written contract (or other arrangement) described in 
section 164.308(b) of such title, with such entity and shall 
be treated as a business associate of the covered entity 
for purposes of the provisions of this subtitle and subparts 
C and E of part 164 of title 45, Code of Federal Regula-
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AMDT. NO. 570 
tions, as such provisions are in effect as of the date of 
enactment of this title. 
SEC. 13409. CLARIFICATION OF APPLICATION OF WRONG-
FUL DISCLOSURES CRIMINAL PENALTIES. 
Section 1177(a) of the Social Security Act (42 U.S.C. 
1320d–6(a)) is amended by adding at the end the fol-
lowing new sentence: ‘‘For purposes of the previous sen-
tence, a person (including an employee or other individual) 
shall be considered to have obtained or disclosed individ-
ually identifiable health information in violation of this 
part if the information is maintained by a covered entity 
(as defined in the HIPAA privacy regulation described in 
section 1180(b)(3)) and the individual obtained or dis-
closed such information without authorization.’’. 
SEC. 13410. IMPROVED ENFORCEMENT. 
(a) IN GENERAL.—Section 1176 of the Social Secu-
rity Act (42 U.S.C. 1320d–5) is amended— 
(1) in subsection (b)(1), by striking ‘‘the act 
constitutes an offense punishable under section 
1177’’ and inserting ‘‘a penalty has been imposed 
under section 1177 with respect to such act’’; and 
(2) by adding at the end the following new sub-
section: 
‘‘(c) NONCOMPLIANCE
DUE
TO
WILLFUL
NE-
GLECT.— 
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AMDT. NO. 570 
‘‘(1) IN GENERAL.—A violation of a provision 
of this part due to willful neglect is a violation for 
which the Secretary is required to impose a penalty 
under subsection (a)(1). 
‘‘(2) REQUIRED INVESTIGATION.—For purposes 
of paragraph (1), the Secretary shall formally inves-
tigate any complaint of a violation of a provision of 
this part if a preliminary investigation of the facts 
of the complaint indicate such a possible violation 
due to willful neglect.’’. 
(b) EFFECTIVE DATE; REGULATIONS.— 
(1) The amendments made by subsection (a) 
shall apply to penalties imposed on or after the date 
that is 24 months after the date of the enactment 
of this title. 
(2) Not later than 18 months after the date of 
the enactment of this title, the Secretary of Health 
and Human Services shall promulgate regulations to 
implement such amendments. 
(c) DISTRIBUTION OF CERTAIN CIVIL MONETARY 
PENALTIES COLLECTED.— 
(1) IN
GENERAL.—Subject to the regulation 
promulgated pursuant to paragraph (3), any civil 
monetary penalty or monetary settlement collected 
with respect to an offense punishable under this sub-
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AMDT. NO. 570 
title or section 1176 of the Social Security Act (42 
U.S.C. 1320d–5) insofar as such section relates to 
privacy or security shall be transferred to the Office 
of Civil Rights of the Department of Health and 
Human Services to be used for purposes of enforcing 
the provisions of this subtitle and subparts C and E 
of part 164 of title 45, Code of Federal Regulations, 
as such provisions are in effect as of the date of en-
actment of this Act. 
(2) GAO REPORT.—Not later than 18 months 
after the date of the enactment of this title, the 
Comptroller General shall submit to the Secretary a 
report including recommendations for a methodology 
under which an individual who is harmed by an act 
that constitutes an offense referred to in paragraph 
(1) may receive a percentage of any civil monetary 
penalty or monetary settlement collected with re-
spect to such offense. 
(3) ESTABLISHMENT
OF
METHODOLOGY
TO 
DISTRIBUTE PERCENTAGE OF CMPS COLLECTED TO 
HARMED
INDIVIDUALS.—Not later than 3 years 
after the date of the enactment of this title, the Sec-
retary shall establish by regulation and based on the 
recommendations submitted under paragraph (2), a 
methodology under which an individual who is 
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AMDT. NO. 570 
harmed by an act that constitutes an offense re-
ferred to in paragraph (1) may receive a percentage 
of any civil monetary penalty or monetary settlement 
collected with respect to such offense. 
(4) APPLICATION
OF
METHODOLOGY.—The 
methodology under paragraph (3) shall be applied 
with respect to civil monetary penalties or monetary 
settlements imposed on or after the effective date of 
the regulation. 
(d) TIERED INCREASE IN AMOUNT OF CIVIL MONE-
TARY PENALTIES.— 
(1) IN GENERAL.—Section 1176(a)(1) of the 
Social Security Act (42 U.S.C. 1320d–5(a)(1)) is 
amended by striking ‘‘who violates a provision of 
this part a penalty of not more than’’ and all that 
follows and inserting the following: ‘‘who violates a 
provision of this part— 
‘‘(A) in the case of a violation of such pro-
vision in which it is established that the person 
did not know (and by exercising reasonable dili-
gence would not have known) that such person 
violated such provision, a penalty for each such 
violation of an amount that is at least the 
amount described in paragraph (3)(A) but not 
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AMDT. NO. 570 
to exceed the amount described in paragraph 
(3)(D); 
‘‘(B) in the case of a violation of such pro-
vision in which it is established that the viola-
tion was due to reasonable cause and not to 
willful neglect, a penalty for each such violation 
of an amount that is at least the amount de-
scribed in paragraph (3)(B) but not to exceed 
the amount described in paragraph (3)(D); and 
‘‘(C) in the case of a violation of such pro-
vision in which it is established that the viola-
tion was due to willful neglect— 
‘‘(i) if the violation is corrected as de-
scribed in subsection (b)(3)(A), a penalty 
in an amount that is at least the amount 
described in paragraph (3)(C) but not to 
exceed the amount described in paragraph 
(3)(D); and 
‘‘(ii) if the violation is not corrected 
as described in such subsection, a penalty 
in an amount that is at least the amount 
described in paragraph (3)(D). 
In determining the amount of a penalty under 
this section for a violation, the Secretary shall 
base such determination on the nature and ex-
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AMDT. NO. 570 
tent of the violation and the nature and extent 
of the harm resulting from such violation.’’. 
(2) TIERS OF PENALTIES DESCRIBED.—Section 
1176(a) of such Act (42 U.S.C. 1320d–5(a)) is fur-
ther amended by adding at the end the following 
new paragraph: 
‘‘(3) TIERS
OF
PENALTIES
DESCRIBED.—For 
purposes of paragraph (1), with respect to a viola-
tion by a person of a provision of this part— 
‘‘(A) the amount described in this subpara-
graph is $100 for each such violation, except 
that the total amount imposed on the person 
for all such violations of an identical require-
ment or prohibition during a calendar year may 
not exceed $25,000; 
‘‘(B) the amount described in this subpara-
graph is $1,000 for each such violation, except 
that the total amount imposed on the person 
for all such violations of an identical require-
ment or prohibition during a calendar year may 
not exceed $100,000; 
‘‘(C) the amount described in this subpara-
graph is $10,000 for each such violation, except 
that the total amount imposed on the person 
for all such violations of an identical require-
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AMDT. NO. 570 
ment or prohibition during a calendar year may 
not exceed $250,000; and 
‘‘(D) the amount described in this sub-
paragraph is $50,000 for each such violation, 
except that the total amount imposed on the 
person for all such violations of an identical re-
quirement or prohibition during a calendar year 
may not exceed $1,500,000.’’. 
(3) 
CONFORMING
AMENDMENTS.—Section 
1176(b) of such Act (42 U.S.C. 1320d–5(b)) is 
amended— 
(A) by striking paragraph (2) and redesig-
nating paragraphs (3) and (4) as paragraphs 
(2) and (3), respectively; and 
(B) in paragraph (2), as so redesignated— 
(i) in subparagraph (A), by striking 
‘‘in subparagraph (B), a penalty may not 
be imposed under subsection (a) if’’ and all 
that follows through ‘‘the failure to comply 
is corrected’’ and inserting ‘‘in subpara-
graph (B) or subsection (a)(1)(C), a pen-
alty may not be imposed under subsection 
(a) if the failure to comply is corrected’’; 
and 
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AMDT. NO. 570 
(ii) in subparagraph (B), by striking 
‘‘(A)(ii)’’ and inserting ‘‘(A)’’ each place it 
appears. 
(4) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to violations occurring 
after the date of the enactment of this title. 
(e) ENFORCEMENT THROUGH STATE ATTORNEYS 
GENERAL.— 
(1) IN GENERAL.—Section 1176 of the Social 
Security Act (42 U.S.C. 1320d–5) is amended by 
adding at the end the following new subsection: 
‘‘(d) ENFORCEMENT BY STATE ATTORNEYS GEN-
ERAL.— 
‘‘(1) CIVIL
ACTION.—Except as provided in 
subsection (b), in any case in which the attorney 
general of a State has reason to believe that an in-
terest of one or more of the residents of that State 
has been or is threatened or adversely affected by 
any person who violates a provision of this part, the 
attorney general of the State, as parens patriae, may 
bring a civil action on behalf of such residents of the 
State in a district court of the United States of ap-
propriate jurisdiction— 
‘‘(A) to enjoin further such violation by the 
defendant; or 
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AMDT. NO. 570 
‘‘(B) to obtain damages on behalf of such 
residents of the State, in an amount equal to 
the amount determined under paragraph (2). 
‘‘(2) STATUTORY DAMAGES.— 
‘‘(A) IN GENERAL.—For purposes of para-
graph (1)(B), the amount determined under 
this paragraph is the amount calculated by mul-
tiplying the number of violations by up to $100. 
For purposes of the preceding sentence, in the 
case of a continuing violation, the number of 
violations shall be determined consistent with 
the HIPAA privacy regulations (as defined in 
section 1180(b)(3)) for violations of subsection 
(a). 
‘‘(B) LIMITATION.—The total amount of 
damages imposed on the person for all viola-
tions of an identical requirement or prohibition 
during a calendar year may not exceed $25,000. 
‘‘(C) REDUCTION
OF
DAMAGES.—In as-
sessing damages under subparagraph (A), the 
court may consider the factors the Secretary 
may consider in determining the amount of a 
civil money penalty under subsection (a) under 
the HIPAA privacy regulations. 
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AMDT. NO. 570 
‘‘(3) ATTORNEY FEES.—In the case of any suc-
cessful action under paragraph (1), the court, in its 
discretion, may award the costs of the action and 
reasonable attorney fees to the State. 
‘‘(4) NOTICE TO SECRETARY.—The State shall 
serve prior written notice of any action under para-
graph (1) upon the Secretary and provide the Sec-
retary with a copy of its complaint, except in any 
case in which such prior notice is not feasible, in 
which case the State shall serve such notice imme-
diately upon instituting such action. The Secretary 
shall have the right— 
‘‘(A) to intervene in the action; 
‘‘(B) upon so intervening, to be heard on 
all matters arising therein; and 
‘‘(C) to file petitions for appeal. 
‘‘(5) CONSTRUCTION.—For purposes of bring-
ing any civil action under paragraph (1), nothing in 
this section shall be construed to prevent an attor-
ney general of a State from exercising the powers 
conferred on the attorney general by the laws of that 
State. 
‘‘(6) VENUE; SERVICE OF PROCESS.— 
‘‘(A) VENUE.—Any action brought under 
paragraph (1) may be brought in the district 
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AMDT. NO. 570 
court of the United States that meets applicable 
requirements relating to venue under section 
1391 of title 28, United States Code. 
‘‘(B) SERVICE OF PROCESS.—In an action 
brought under paragraph (1), process may be 
served in any district in which the defendant— 
‘‘(i) is an inhabitant; or 
‘‘(ii) maintains a physical place of 
business. 
‘‘(7) LIMITATION
ON
STATE
ACTION
WHILE 
FEDERAL ACTION IS PENDING.—If the Secretary has 
instituted an action against a person under sub-
section (a) with respect to a specific violation of this 
part, no State attorney general may bring an action 
under this subsection against the person with re-
spect to such violation during the pendency of that 
action. 
‘‘(8) APPLICATION OF CMP STATUTE OF LIMI-
TATION.—A civil action may not be instituted with 
respect to a violation of this part unless an action 
to impose a civil money penalty may be instituted 
under subsection (a) with respect to such violation 
consistent with the second sentence of section 
1128A(c)(1).’’. 
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AMDT. NO. 570 
(2) CONFORMING
AMENDMENTS.—Subsection 
(b) of such section, as amended by subsection (d)(3), 
is amended— 
(A) in paragraph (1), by striking ‘‘A pen-
alty may not be imposed under subsection (a)’’ 
and inserting ‘‘No penalty may be imposed 
under subsection (a) and no damages obtained 
under subsection (d)’’; 
(B) in paragraph (2)(A)— 
(i) after ‘‘subsection (a)(1)(C),’’, by 
striking ‘‘a penalty may not be imposed 
under subsection (a)’’ and inserting ‘‘no 
penalty may be imposed under subsection 
(a) and no damages obtained under sub-
section (d)’’; and 
(ii) in clause (ii), by inserting ‘‘or 
damages’’ after ‘‘the penalty’’; 
(C) in paragraph (2)(B)(i), by striking 
‘‘The period’’ and inserting ‘‘With respect to 
the imposition of a penalty by the Secretary 
under subsection (a), the period’’; and 
(D) in paragraph (3), by inserting ‘‘and 
any damages under subsection (d)’’ after ‘‘any 
penalty under subsection (a)’’. 
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AMDT. NO. 570 
(3) EFFECTIVE DATE.—The amendments made 
by this subsection shall apply to violations occurring 
after the date of the enactment of this Act. 
(f) ALLOWING CONTINUED USE OF CORRECTIVE AC-
TION.—Such section is further amended by adding at the 
end the following new subsection: 
‘‘(e) ALLOWING CONTINUED USE OF CORRECTIVE 
ACTION.—Nothing in this section shall be construed as 
preventing the Office of Civil Rights of the Department 
of Health and Human Services from continuing, in its dis-
cretion, to use corrective action without a penalty in cases 
where the person did not know (and by exercising reason-
able diligence would not have known) of the violation in-
volved.’’. 
SEC. 13411. AUDITS. 
The Secretary shall provide for periodic audits to en-
sure that covered entities and business associates that are 
subject to the requirements of this subtitle and subparts 
C and E of part 164 of title 45, Code of Federal Regula-
tions, as such provisions are in effect as of the date of 
enactment of this Act, comply with such requirements. 
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AMDT. NO. 570 
PART II—RELATIONSHIP TO OTHER LAWS; REGU-
LATORY REFERENCES; EFFECTIVE DATE; RE-
PORTS 
SEC. 13421. RELATIONSHIP TO OTHER LAWS. 
(a) APPLICATION OF HIPAA STATE PREEMPTION.— 
Section 1178 of the Social Security Act (42 U.S.C. 
1320d–7) shall apply to a provision or requirement under 
this subtitle in the same manner that such section applies 
to a provision or requirement under part C of title XI of 
such Act or a standard or implementation specification 
adopted or established under sections 1172 through 1174 
of such Act. 
(b) HEALTH INSURANCE PORTABILITY
AND AC-
COUNTABILITY ACT.—The standards governing the pri-
vacy and security of individually identifiable health infor-
mation promulgated by the Secretary under sections 
262(a) and 264 of the Health Insurance Portability and 
Accountability Act of 1996 shall remain in effect to the 
extent that they are consistent with this subtitle. The Sec-
retary shall by rule amend such Federal regulations as re-
quired to make such regulations consistent with this sub-
title. In carrying out the preceding sentence, the Secretary 
shall revise the definition of ‘‘psychotherapy notes’’ in sec-
tion 164.501 of title 45, Code of Federal Regulations, to 
include test data that is related to direct responses, scores, 
items, forms, protocols, manuals, or other materials that 
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AMDT. NO. 570 
are part of a mental health evaluation, as determined by 
the mental health professional providing treatment or 
evaluation. 
SEC. 13422. REGULATORY REFERENCES. 
Each reference in this subtitle to a provision of the 
Code of Federal Regulations refers to such provision as 
in effect on the date of the enactment of this title (or to 
the most recent update of such provision). 
SEC. 13423. EFFECTIVE DATE. 
Except as otherwise specifically provided, the provi-
sions of part I shall take effect on the date that is 12 
months after the date of the enactment of this title. 
SEC. 13424. STUDIES, REPORTS, GUIDANCE. 
(a) REPORT ON COMPLIANCE.— 
(1) IN GENERAL.—For the first year beginning 
after the date of the enactment of this Act and an-
nually thereafter, the Secretary shall prepare and 
submit to the Committee on Health, Education, 
Labor, and Pensions of the Senate and the Com-
mittee on Ways and Means and the Committee on 
Energy and Commerce of the House of Representa-
tives a report concerning complaints of alleged viola-
tions of law, including the provisions of this subtitle 
as well as the provisions of subparts C and E of part 
164 of title 45, Code of Federal Regulations, (as 
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AMDT. NO. 570 
such provisions are in effect as of the date of enact-
ment of this Act) relating to privacy and security of 
health information that are received by the Secretary 
during the year for which the report is being pre-
pared. Each such report shall include, with respect 
to such complaints received during the year— 
(A) the number of such complaints; 
(B) the number of such complaints re-
solved informally, a summary of the types of 
such complaints so resolved, and the number of 
covered entities that received technical assist-
ance from the Secretary during such year in 
order to achieve compliance with such provi-
sions and the types of such technical assistance 
provided; 
(C) the number of such complaints that 
have resulted in the imposition of civil monetary 
penalties or have been resolved through mone-
tary settlements, including the nature of the 
complaints involved and the amount paid in 
each penalty or settlement; 
(D) the number of compliance reviews con-
ducted and the outcome of each such review; 
(E) the number of subpoenas or inquiries 
issued; 
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AMDT. NO. 570 
(F) the Secretary’s plan for improving 
compliance with and enforcement of such provi-
sions for the following year; and 
(G) the number of audits performed and a 
summary of audit findings pursuant to section 
13411. 
(2) AVAILABILITY
TO
PUBLIC.—Each report 
under paragraph (1) shall be made available to the 
public on the Internet website of the Department of 
Health and Human Services. 
(b) STUDY AND REPORT ON APPLICATION OF PRI-
VACY
AND SECURITY REQUIREMENTS
TO NON-HIPAA 
COVERED ENTITIES.— 
(1) STUDY.—Not later than one year after the 
date of the enactment of this title, the Secretary, in 
consultation with the Federal Trade Commission, 
shall conduct a study, and submit a report under 
paragraph (2), on privacy and security requirements 
for entities that are not covered entities or business 
associates as of the date of the enactment of this 
title, including— 
(A) requirements relating to security, pri-
vacy, and notification in the case of a breach of 
security or privacy (including the applicability 
of an exemption to notification in the case of 
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AMDT. NO. 570 
individually identifiable health information that 
has been rendered unusable, unreadable, or in-
decipherable through technologies or methodolo-
gies recognized by appropriate professional or-
ganization or standard setting bodies to provide 
effective security for the information) that 
should be applied to— 
(i) vendors of personal health records; 
(ii) entities that offer products or 
services through the website of a vendor of 
personal health records; 
(iii) entities that are not covered enti-
ties and that offer products or services 
through the websites of covered entities 
that offer individuals personal health 
records; 
(iv) entities that are not covered enti-
ties and that access information in a per-
sonal health record or send information to 
a personal health record; and 
(v) third party service providers used 
by a vendor or entity described in clause 
(i), (ii), (iii), or (iv) to assist in providing 
personal health record products or services; 
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AMDT. NO. 570 
(B) a determination of which Federal gov-
ernment agency is best equipped to enforce 
such requirements recommended to be applied 
to such vendors, entities, and service providers 
under subparagraph (A); and 
(C) a timeframe for implementing regula-
tions based on such findings. 
(2) REPORT.—The Secretary shall submit to 
the Committee on Finance, the Committee on 
Health, Education, Labor, and Pensions, and the 
Committee on Commerce of the Senate and the 
Committee on Ways and Means and the Committee 
on Energy and Commerce of the House of Rep-
resentatives a report on the findings of the study 
under paragraph (1) and shall include in such report 
recommendations on the privacy and security re-
quirements described in such paragraph. 
(c) GUIDANCE ON IMPLEMENTATION SPECIFICATION 
TO DE-IDENTIFY PROTECTED HEALTH INFORMATION.— 
Not later than 12 months after the date of the enactment 
of this title, the Secretary shall, in consultation with stake-
holders, issue guidance on how best to implement the re-
quirements for the de-identification of protected health in-
formation under section 164.514(b) of title 45, Code of 
Federal Regulations. 
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AMDT. NO. 570 
(d) GAO REPORT ON TREATMENT DISCLOSURES.— 
Not later than one year after the date of the enactment 
of this title, the Comptroller General of the United States 
shall submit to the Committee on Health, Education, 
Labor, and Pensions of the Senate and the Committee on 
Ways and Means and the Committee on Energy and Com-
merce of the House of Representatives a report on the 
best practices related to the disclosure among health care 
providers of protected health information of an individual 
for purposes of treatment of such individual. Such report 
shall include an examination of the best practices imple-
mented by States and by other entities, such as health 
information exchanges and regional health information or-
ganizations, an examination of the extent to which such 
best practices are successful with respect to the quality 
of the resulting health care provided to the individual and 
with respect to the ability of the health care provider to 
manage such best practices, and an examination of the 
use of electronic informed consent for disclosing protected 
health information for treatment, payment, and health 
care operations. 
(e) REPORT REQUIRED.—Not later than 1 year after 
the date of enactment of this section, the Government Ac-
countability Office shall submit to Congress and the Sec-
retary of Health and Human Services a report on the im-
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AMDT. NO. 570 
pact of any of the provisions of, or amendments made by, 
this division or division B that are related to the Health 
Insurance Portability and Accountability Act of 1996 and 
section 552a of title 5, United States Code, on health in-
surance premiums and overall health care costs. 
TITLE XIV—STATE FISCAL 
STABILIZATION 
DEPARTMENT OF EDUCATION 
STATE FISCAL STABILIZATION FUND 
For necessary expenses for a State Fiscal Stabiliza-
tion Fund, $39,000,000,000, which shall be administered 
by the Department of Education, and shall be available 
through September 30, 2010. 
GENERAL PROVISIONS—THIS TITLE 
SEC. 1401. ALLOCATIONS. 
(a) OUTLYING AREAS.—The Secretary of Education 
shall first allocate one-half of 1 percent to the outlying 
areas on the basis of their respective needs, as determined 
by the Secretary, for activities consistent with this title 
under such terms and conditions as the Secretary may de-
termine. 
(b) ADMINISTRATION AND OVERSIGHT.—The Sec-
retary may reserve up to $25,000,000 for administration 
and oversight of this title, including for program evalua-
tion. 
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(c) RESERVATION FOR ADDITIONAL PROGRAMS.— 
After reserving funds under subsections (a) and (b), the 
Secretary shall reserve $7,500,000,000 for grants under 
sections 1406 and 1407. 
(d) STATE ALLOCATIONS.—After carrying out sub-
sections (a), (b), and (c), the Secretary shall allocate the 
remaining funds made available to carry out this title to 
the States as follows: 
(1) 61 percent on the basis of their relative 
population of individuals aged 5 through 24. 
(2) 39 percent on the basis of their relative 
total population. 
(e) STATE GRANTS.—From funds allocated under 
subsection (d), the Secretary shall make grants to the 
Governor of each State. 
(f) REALLOCATION.—The Governor shall return to 
the Secretary any funds received under subsection (e) that 
the Governor does not obligate within 1 year of receiving 
a grant, and the Secretary shall reallocate such funds to 
the remaining States in accordance with subsection (d). 
SEC. 1402. STATE USES OF FUNDS. 
EDUCATION FUND.—(a) IN
GENERAL.—The Gov-
ernor shall use the State’s allocation under section 1401 
for the support of elementary, secondary, and postsec-
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AMDT. NO. 570 
ondary education and, as applicable, early childhood edu-
cation programs and services. 
(b) RESTORING
2008
STATE
SUPPORT
FOR
EDU-
CATION.— 
(1) IN GENERAL.—The Governor shall first use the 
funds described in subsection (a)— 
(A) to provide the amount of funds, 
through the State’s principal elementary and 
secondary funding formula, that is needed to 
restore State support for elementary and sec-
ondary education to the fiscal year 2008 level; 
and where applicable, to allow existing State 
formula increases for fiscal years 2009, 2010, 
and 2011 to be implemented and allow funding 
for phasing in State equity and adequacy ad-
justments that were enacted prior to July 1, 
2008; and 
(B) to provide the amount of funds to pub-
lic institutions of higher education in the State 
that is needed to restore State support for post-
secondary education to the fiscal year 2008 
level. 
(2) SHORTFALL.—If the Governor determines that 
the amount of funds available under subsection (a) is in-
sufficient to restore State support for education to the lev-
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AMDT. NO. 570 
els described in subparagraphs (A) and (B) of paragraph 
(1), the Governor shall allocate those funds between those 
clauses in proportion to the relative shortfall in State sup-
port for the education sectors described in those clauses. 
(c) SUBGRANTS TO IMPROVE BASIC PROGRAMS OPER-
ATED
BY
LOCAL
EDUCATIONAL
AGENCIES.—After car-
rying out subsection (b), the Governor shall use any funds 
remaining under subsection (a) to provide local edu-
cational agencies in the State with subgrants based on 
their relative shares of funding under part A of title I of 
the Elementary and Secondary Education Act of 1965 (20 
U.S.C. 6311 et seq.) for the most recent year for which 
data are available. 
SEC. 1403. USES OF FUNDS BY LOCAL EDUCATIONAL AGEN-
CIES. 
(1) IN GENERAL.—A local educational agency that 
receives funds under this title may use the funds for any 
activity authorized by the Elementary and Secondary Edu-
cation Act of 1965 (20 U.S.C. 6301 et seq.) (‘‘ESEA’’), 
the Individuals with Disabilities Education Act (20 U.S.C. 
1400 et seq.) (‘‘IDEA’’), or the Carl D. Perkins Career 
and Technical Education Act of 2006 (20 U.S.C. 2301 
et seq.) (‘‘the Perkins Act’’). 
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AMDT. NO. 570 
(b) PROHIBITION.—A local educational agency may 
not use funds received under this title for capital projects 
unless authorized by ESEA, IDEA, or the Perkins Act. 
SEC. 1404. USES OF FUNDS BY INSTITUTIONS OF HIGHER 
EDUCATION. 
(a) IN GENERAL.—A public institution of higher edu-
cation that receives funds under this title shall use the 
funds for education and general expenditures, and in such 
a way as to mitigate the need to raise tuition and fees 
for in-State students. 
(b) PROHIBITION.—An institution of higher edu-
cation may not use funds received under this title to in-
crease its endowment. 
(c) ADDITIONAL PROHIBITION.—An institution of 
higher education may not use funds received under this 
title for construction, renovation, or facility repair. 
SEC. 1405. STATE APPLICATIONS. 
(a) IN GENERAL.—The Governor of a State desiring 
to receive an allocation under section 1401 shall submit 
an application at such time, in such manner, and con-
taining such information as the Secretary may reasonably 
require. 
(b) APPLICATION.—The Governor shall— 
(1) include the assurances described in sub-
section (d); 
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AMDT. NO. 570 
(2) provide baseline data that demonstrates the 
State’s current status in each of the areas described 
in such assurances; and 
(3) describe how the State intends to use its al-
location. 
(c) INCENTIVE GRANT APPLICATION.—The Governor 
of a State seeking a grant under section 1406 shall— 
(1) submit an application for consideration; 
(2) describe the status of the State’s progress 
in each of the areas described in subsection (d); 
(3) describe the achievement and graduation 
rates of public elementary and secondary school stu-
dents in the State, and the strategies the State is 
employing to help ensure that all subgroups of stu-
dents identified in 1111(b)(2) of ESEA in the State 
continue making progress toward meeting the 
State’s student academic achievement standards; 
(4) describe how the State would use its grant 
funding to improve student academic achievement in 
the State, including how it will allocate the funds to 
give priority to high-need schools and local edu-
cational agencies; and 
(5) include a plan for evaluating its progress in 
closing achievement gaps. 
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AMDT. NO. 570 
(d) ASSURANCES.—An application under subsection 
(b) shall include the following assurances: 
(1) MAINTENANCE OF EFFORT.— 
(A) ELEMENTARY AND SECONDARY EDU-
CATION.—The State will, in each of fiscal years 
2009 and 2010, maintain State support for ele-
mentary and secondary education at least at 
the level of such support in fiscal year 2006. 
(B) HIGHER EDUCATION.—The State will, 
in each of fiscal years 2009 and 2010, maintain 
State support for public institutions of higher 
education (not including support for capital 
projects or for research and development) at 
least at the level of such support in fiscal year 
2006. 
(2) ACHIEVING EQUITY IN TEACHER DISTRIBU-
TION.—The State will take action, including activi-
ties outlined in section 2113(c) of ESEA, to increase 
the number, and improve the distribution, of effec-
tive teachers and principals in high-poverty schools 
and local educational agencies throughout the State. 
(3) IMPROVING
COLLECTION
AND
USE
OF 
DATA.—The State will establish a longitudinal data 
system that includes the elements described in sec-
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AMDT. NO. 570 
tion 6401(e)(2)(D) of the America COMPETES Act 
(20 U.S.C. 9871). 
(4) 
STANDARDS
AND
ASSESSMENTS.—The 
State— 
(A) will enhance the quality of academic 
assessments described in section 1111(b)(3) of 
ESEA (20 U.S.C. 6311(b)(3)) through activi-
ties such as those described in section 6112(a) 
of such Act (20 U.S.C. 7301a(a)); 
(B) will comply with the requirements of 
paragraphs (3)(C)(ix) and (6) of section 
1111(b) of ESEA (20 U.S.C. 6311(b)) and sec-
tion 
612(a)(16) 
of 
IDEA 
(20 
U.S.C. 
1412(a)(16)) related to the inclusion of children 
with disabilities and limited English proficient 
students in State assessments, the development 
of valid and reliable assessments for those stu-
dents, and the provision of accommodations 
that enable their participation in State assess-
ments; and 
(C) will take steps to improve State aca-
demic content standards and student academic 
achievement 
standards 
consistent 
with 
6401(e)(1)(A)(ii) of the America COMPETES 
Act. 
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AMDT. NO. 570 
(5) will ensure compliance with the require-
ments of section 1116(a)(7)(C)(iv) and section 
1116(a)(8)(B) with respect to schools identified 
under such sections. 
SEC. 1406. STATE INCENTIVE GRANTS. 
(a) IN GENERAL.—From the total amount reserved 
under section 1401(c) that is not used for section 1407, 
the Secretary shall, in fiscal year 2010, make grants to 
States that have made significant progress in meeting the 
objectives of paragraphs (2), (3), (4), and (5) of section 
1405(d). 
(b) BASIS FOR GRANTS.—The Secretary shall deter-
mine which States receive grants under this section, and 
the amount of those grants, on the basis of information 
provided in State applications under section 1405 and 
such other criteria as the Secretary determines appro-
priate. 
(c) SUBGRANTS
TO LOCAL EDUCATIONAL AGEN-
CIES.—Each State receiving a grant under this section 
shall use at least 50 percent of the grant to provide local 
educational agencies in the State with subgrants based on 
their relative shares of funding under part A of title I of 
ESEA (20 U.S.C. 6311 et seq.) for the most recent year. 
SEC. 1407. INNOVATION FUND. 
(a) IN GENERAL.— 
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AMDT. NO. 570 
(1) ELIGIBLE
ENTITY.—For the purposes of 
this section, the term ‘‘eligible entity’’ means— 
(A) A local educational agency; or 
(B) a partnership between a nonprofit or-
ganization and— 
(i) one or more local educational agen-
cies; 
(ii) or a consortium of schools. 
(2) PROGRAM ESTABLISHED.—From the total 
amount reserved under section 1401(c), the Sec-
retary may reserve up to $650,000,000 to establish 
an Innovation Fund, which shall consist of academic 
achievement awards that recognize eligible entities 
that meet the requirements described in subsection 
(b). 
(3) BASIS FOR AWARDS.—The Secretary shall 
make awards to eligible entities that have made sig-
nificant gains in closing the achievement gap as de-
scribed in subsection (b)(1)— 
(A) to allow such eligible entities to expand 
their work and serve as models for best prac-
tices; 
(B) to allow such eligible entities to work 
in partnership with the private sector and the 
philanthropic community; and 
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AMDT. NO. 570 
(C) to identify and document best practices 
that can be shared, and taken to scale based on 
demonstrated success. 
(b) ELIGIBILITY.—To be eligible for such an award, 
an eligible entity shall— 
(1) have significantly closed the achievement 
gaps between groups of students described in section 
1111(b)(2) of ESEA (20 U.S.C. 6311(b)(2)); 
(2) have exceeded the State’s annual measur-
able 
objectives 
consistent 
with 
such 
section 
1111(b)(2) for 2 or more consecutive years or have 
demonstrated success in significantly increasing stu-
dent academic achievement for all groups of stu-
dents described in such section through another 
measure, such as measures described in section 
1111(c)(2) of ESEA; 
(3) have made significant improvement in other 
areas, such as graduation rates or increased recruit-
ment and placement of high-quality teachers and 
school leaders, as demonstrated with meaningful 
data; and 
(4) demonstrate that they have established 
partnerships with the private sector, which may in-
clude philanthropic organizations, and that the pri-
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AMDT. NO. 570 
vate sector will provide matching funds in order to 
help bring results to scale. 
SEC. 1408. STATE REPORTS. 
A State receiving funds under this title shall submit 
a report to the Secretary, at such time and in such manner 
as the Secretary may require, that describes— 
(1) the uses of funds provided under this title 
within the State; 
(2) how the State distributed the funds it re-
ceived under this title; 
(3) the number of jobs that the Governor esti-
mates were saved or created with funds the State re-
ceived under this title; 
(4) tax increases that the Governor estimates 
were averted because of the availability of funds 
from this title; 
(5) the State’s progress in reducing inequities 
in the distribution of teachers, in implementing a 
State student longitudinal data system, and in devel-
oping and implementing valid and reliable assess-
ments for limited English proficient students and 
children with disabilities; 
(6) the tuition and fee increases for in-State 
students imposed by public institutions of higher 
education in the State during the period of avail-
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AMDT. NO. 570 
ability of funds under this title, and a description of 
any actions taken by the State to limit those in-
creases; and 
(7) the extent to which public institutions of 
higher education maintained, increased, or decreased 
enrollment of in-State students, including students 
eligible for Pell Grants or other need-based financial 
assistance. 
SEC. 1409. EVALUATION. 
The Comptroller General of the United States shall 
conduct evaluations of the programs under sections 1406 
and 1407 which shall include, but not be limited to, the 
criteria used for the awards made, the States selected for 
awards, award amounts, how each State used the award 
received, and the impact of this funding on the progress 
made toward closing achievement gaps. 
SEC. 1410. SECRETARY’S REPORT TO CONGRESS. 
The Secretary shall submit a report to the Committee 
on Education and Labor of the House of Representatives, 
the Committee on Health, Education, Labor, and Pen-
sions of the Senate, and the Committees on Appropria-
tions of the House of Representatives and of the Senate, 
not less than 6 months following the submission of the 
State reports, that evaluates the information provided in 
the State reports under section 1408. 
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AMDT. NO. 570 
SEC. 1411. PROHIBITION ON PROVISION OF CERTAIN AS-
SISTANCE. 
No recipient of funds under this title shall use such 
funds to provide financial assistance to students to attend 
private elementary or secondary schools, unless such funds 
are used to provide special education and related services 
to children with disabilities, as authorized by the Individ-
uals with Disabilities Education Act (20 U.S.C. 1400 et 
seq.). 
SEC. 1412. DEFINITIONS. 
Except as otherwise provided in this title, as used in 
this title— 
(1) the term ‘‘institution of higher education’’ 
has the meaning given such term in section 101 of 
the Higher Education Act of 1965 (20 U.S.C. 
1001); 
(2) the term ‘‘Secretary’’ means the Secretary 
of Education; 
(3) the term ‘‘State’’ means each of the 50 
States, the District of Columbia, and the Common-
wealth of Puerto Rico; and 
(4) any other term that is defined in section 
9101 of ESEA (20 U.S.C. 7801) shall have the 
meaning given the term in such section. 
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AMDT. NO. 570 
SEC. 1413. REGULATORY RELIEF. 
(a) WAIVER AUTHORITY.—Subject to subsections (b) 
and (c), the Secretary of Education may, as applicable, 
waive or modify, in order to ease fiscal burdens, any re-
quirement relating to the following: 
(1) Maintenance of effort. 
(2) The use of Federal funds to supplement, 
not supplant, non-Federal funds. 
(b) DURATION.—A waiver under this section shall be 
for fiscal years 2009 and 2010. 
(c) LIMITATIONS.— 
(1) RELATION TO IDEA.—Nothing in this sec-
tion shall be construed to permit the Secretary to 
waive or modify any provision of the Individuals 
with Disabilities Education Act (20 U.S.C. 1400 et 
seq.), except as described in a(1) and a(2). 
(2) MAINTENANCE
OF
EFFORT.—If the Sec-
retary grants a waiver or modification under this 
section waiving or modifying a requirement relating 
to maintenance of effort for fiscal years 2009 and 
2010, the level of effort required for fiscal year 2011 
shall not be reduced because of the waiver or modi-
fication. 
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AMDT. NO. 570 
TITLE XV—RECOVERY ACCOUNT-
ABILITY AND TRANSPARENCY 
BOARD AND RECOVERY INDE-
PENDENT ADVISORY PANEL 
SEC. 1501. DEFINITIONS. 
In this title: 
(1) AGENCY.—The term ‘‘agency’’ has the 
meaning given under section 551 of title 5, United 
States Code. 
(2) BOARD.—The term ‘‘Board’’ means the Re-
covery Accountability and Transparency Board es-
tablished in section 1511. 
(3) CHAIRPERSON.—The term ‘‘Chairperson’’ 
means the Chairperson of the Board. 
(4) COVERED
FUNDS.—The term ‘‘covered 
funds’’ means any funds that are expended or obli-
gated— 
(A) from appropriations made under this 
Act; and 
(B) under any other authorities provided 
under this Act. 
(5) PANEL.—The term ‘‘Panel’’ means the Re-
covery Independent Advisory Panel established in 
section 1531. 
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AMDT. NO. 570 
Subtitle 
A—Recovery 
Account-
ability and Transparency Board 
SEC. 1511. ESTABLISHMENT OF THE RECOVERY ACCOUNT-
ABILITY AND TRANSPARENCY BOARD. 
There is established the Recovery Accountability and 
Transparency Board to coordinate and conduct oversight 
of covered funds to prevent fraud, waste, and abuse. 
SEC. 1512. COMPOSITION OF BOARD. 
(a) CHAIRPERSON.— 
(1) DESIGNATION
OR
APPOINTMENT.—The 
President shall— 
(A) designate the Deputy Director for 
Management of the Office of Management and 
Budget to serve as Chairperson of the Board; 
(B) designate another Federal officer who 
was appointed by the President to a position 
that required the advice and consent of the 
Senate, to serve as Chairperson of the Board; 
or 
(C) appoint an individual as the Chair-
person of the Board, by and with the advice 
and consent of the Senate. 
(2) COMPENSATION.— 
(A) DESIGNATION
OF
FEDERAL
OFFI-
CER.—If the President designates a Federal of-
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AMDT. NO. 570 
ficer under paragraph (1)(A) or (B) to serve as 
Chairperson, that Federal officer may not re-
ceive additional compensation for services per-
formed as Chairperson. 
(B) APPOINTMENT OF NON-FEDERAL OF-
FICER.—If the President appoints an individual 
as Chairperson under paragraph (1)(C), that 
individual shall be compensated at the rate of 
basic pay prescribed for level IV of the Execu-
tive Schedule under section 5315 of title 5, 
United States Code. 
(b) MEMBERS.—The members of the Board shall in-
clude— 
(1) the Inspectors General of the Departments 
of Agriculture, Commerce, Education, Energy, 
Health and Human Services, Homeland Security, 
Justice, Transportation, Treasury, and the Treasury 
Inspector General for Tax Administration; and 
(2) any other Inspector General as designated 
by the President from any agency that expends or 
obligates covered funds. 
SEC. 1513. FUNCTIONS OF THE BOARD. 
(a) FUNCTIONS.— 
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(1) IN GENERAL.—The Board shall coordinate 
and conduct oversight of covered funds in order to 
prevent fraud, waste, and abuse. 
(2) SPECIFIC
FUNCTIONS.—The functions of 
the Board shall include— 
(A) reviewing whether the reporting of con-
tracts and grants using covered funds meets ap-
plicable standards and specifies the purpose of 
the contract or grant and measures of perform-
ance; 
(B) reviewing whether competition require-
ments applicable to contracts and grants using 
covered funds have been satisfied; 
(C) auditing and investigating covered 
funds to determine whether wasteful spending, 
poor contract or grant management, or other 
abuses are occurring; 
(D) reviewing whether there are sufficient 
qualified acquisition and grant personnel over-
seeing covered funds; 
(E) reviewing whether personnel whose du-
ties involve acquisitions or grants made with 
covered funds receive adequate training; and 
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AMDT. NO. 570 
(F) reviewing whether there are appro-
priate mechanisms for interagency collaboration 
relating to covered funds. 
(b) REPORTS.— 
(1) QUARTERLY
REPORTS.—The Board shall 
submit quarterly reports to the President and Con-
gress, including the Committees on Appropriations 
of the Senate and House of Representatives, summa-
rizing the findings of the Board and the findings of 
inspectors general of agencies. The Board may sub-
mit additional reports as appropriate. 
(2) ANNUAL REPORTS.—The Board shall sub-
mit annual reports to the President and the Com-
mittees on Appropriations of the Senate and House 
of Representatives, consolidating applicable quarterly 
reports on the use of covered funds. 
(3) PUBLIC AVAILABILITY.— 
(A) IN GENERAL.—All reports submitted 
under this subsection shall be made publicly 
available and posted on a website established by 
the Board. 
(B) REDACTIONS.—Any portion of a re-
port submitted under this subsection may be re-
dacted when made publicly available, if that 
portion would disclose information that is not 
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AMDT. NO. 570 
subject to disclosure under section 552 of title 
5, United States Code (commonly known as the 
Freedom of Information Act). 
(c) RECOMMENDATIONS.— 
(1) IN GENERAL.—The Board shall make rec-
ommendations to agencies on measures to prevent 
fraud, waste, and abuse relating to covered funds. 
(2) RESPONSIVE REPORTS.—Not later than 30 
days after receipt of a recommendation under para-
graph (1), an agency shall submit a report to the 
President, the congressional committees of jurisdic-
tion, including the Committees on Appropriations of 
the Senate and House of Representatives, and the 
Board on— 
(A) whether the agency agrees or disagrees 
with the recommendations; and 
(B) any actions the agency will take to im-
plement the recommendations. 
SEC. 1514. POWERS OF THE BOARD. 
(a) IN GENERAL.—The Board shall conduct, super-
vise, and coordinate audits and investigations by inspec-
tors general of agencies relating to covered funds. 
(b) AUDITS
AND
INVESTIGATIONS.—The Board 
may— 
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(1) conduct its own independent audits and in-
vestigations relating to covered funds; and 
(2) collaborate on audits and investigations re-
lating to covered funds with any inspector general of 
an agency. 
(c) AUTHORITIES.— 
(1) AUDITS
AND
INVESTIGATIONS.—In con-
ducting audits and investigations, the Board shall 
have the authorities provided under section 6 of the 
Inspector General Act of 1978 (5 U.S.C. App.). 
(2) STANDARDS AND GUIDELINES.—The Board 
shall carry out the powers under subsections (a) and 
(b) in accordance with section 4(b)(1) of the Inspec-
tor General Act of 1978 (5 U.S.C. App.). 
(d) PUBLIC HEARINGS.—The Board may hold public 
hearings and Board personnel may conduct investigative 
depositions. The head of each agency shall make all offi-
cers and employees of that agency available to provide tes-
timony to the Board and Board personnel. The Board may 
issue subpoenas to compel the testimony of persons who 
are not Federal officers or employees. Any such subpoenas 
may be enforced as provided under section 6 of the Inspec-
tor General Act of 1978 (5 U.S.C. App.). 
(e) CONTRACTS.—The Board may enter into con-
tracts to enable the Board to discharge its duties under 
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this subtitle, including contracts and other arrangements 
for audits, studies, analyses, and other services with public 
agencies and with private persons, and make such pay-
ments as may be necessary to carry out the duties of the 
Board. 
(f) TRANSFER OF FUNDS.—The Board may transfer 
funds appropriated to the Board for expenses to support 
administrative support services and audits or investiga-
tions of covered funds to any office of inspector general, 
the Office of Management and Budget, the General Serv-
ices Administration, and the Panel. 
SEC. 1515. EMPLOYMENT, PERSONNEL, AND RELATED AU-
THORITIES. 
(a) EMPLOYMENT AND PERSONNEL AUTHORITIES.— 
(1) IN GENERAL.— 
(A) AUTHORITIES.—Subject to paragraph 
(2), the Board may exercise the authorities of 
subsections (b) through (i) of section 3161 of 
title 5, United States Code (without regard to 
subsection (a) of that section). 
(B) APPLICATION.—For purposes of exer-
cising the authorities described under subpara-
graph (A), the term ‘‘Chairperson of the 
Board’’ shall be substituted for the term ‘‘head 
of a temporary organization’’. 
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AMDT. NO. 570 
(C) CONSULTATION.—In exercising the au-
thorities described under subparagraph (A), the 
Chairperson shall consult with members of the 
Board. 
(2) EMPLOYMENT AUTHORITIES.—In exercising 
the employment authorities under subsection (b) of 
section 3161 of title 5, United States Code, as pro-
vided under paragraph (1) of this subsection— 
(A) paragraph (2) of subsection (b) of sec-
tion 3161 of that title (relating to periods of 
appointments) shall not apply; and 
(B) no period of appointment may exceed 
the date on which the Board terminates under 
section 1521. 
(b) INFORMATION AND ASSISTANCE.— 
(1) IN GENERAL.—Upon request of the Board 
for information or assistance from any agency or 
other entity of the Federal Government, the head of 
such entity shall, insofar as is practicable and not in 
contravention of any existing law, furnish such infor-
mation or assistance to the Board, or an authorized 
designee. 
(2) REPORT
OF
REFUSALS.—Whenever infor-
mation or assistance requested by the Board is, in 
the judgment of the Board, unreasonably refused or 
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AMDT. NO. 570 
not provided, the Board shall report the cir-
cumstances to the congressional committees of juris-
diction, including the Committees on Appropriations 
of the Senate and House of Representatives, without 
delay. 
(c) ADMINISTRATIVE SUPPORT.—The General Serv-
ices Administration shall provide the Board with adminis-
trative support services, including the provision of office 
space and facilities. 
SEC. 1516. INDEPENDENCE OF INSPECTORS GENERAL. 
(a) INDEPENDENT AUTHORITY.—Nothing in this 
subtitle shall affect the independent authority of an in-
spector general to determine whether to conduct an audit 
or investigation of covered funds. 
(b) REQUESTS BY BOARD.—If the Board requests 
that an inspector general conduct or refrain from con-
ducting an audit or investigation and the inspector general 
rejects the request in whole or in part, the inspector gen-
eral shall, not later than 30 days after rejecting the re-
quest, submit a report to the Board, the head of the appli-
cable agency, and the congressional committees of juris-
diction, including the Committees on Appropriations of the 
Senate and House of Representatives. The report shall 
state the reasons that the inspector general has rejected 
the request in whole or in part. 
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AMDT. NO. 570 
SEC. 1517. COORDINATION WITH THE COMPTROLLER GEN-
ERAL AND STATE AUDITORS. 
The Board shall coordinate its oversight activities 
with the Comptroller General of the United States and 
State auditor generals. 
SEC. 1518. PROTECTING STATE AND LOCAL GOVERNMENT 
AND CONTRACTOR WHISTLEBLOWERS. 
(a) PROHIBITION OF REPRISALS.—An employee of 
any non-Federal employer receiving covered funds may not 
be discharged, demoted, or otherwise discriminated 
against as a reprisal for disclosing to the Board, an in-
spector general, the Comptroller General, a member of 
Congress, or a the head of a Federal agency, or their rep-
resentatives, information that the employee reasonably be-
lieves is evidence of— 
(1) gross mismanagement of an agency contract 
or grant relating to covered funds; 
(2) a gross waste of covered funds; 
(3) a substantial and specific danger to public 
health or safety; or 
(4) a violation of law related to an agency con-
tract (including the competition for or negotiation of 
a contract) or grant, awarded or issued relating to 
covered funds. 
(b) INVESTIGATION OF COMPLAINTS.— 
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AMDT. NO. 570 
(1) IN GENERAL.—A person who believes that 
the person has been subjected to a reprisal prohib-
ited by subsection (a) may submit a complaint to the 
appropriate inspector general. Unless the inspector 
general determines that the complaint is frivolous, 
the inspector general shall investigate the complaint 
and, upon completion of such investigation, submit 
a report of the findings of the investigation to the 
person, the person’s employer, the head of the ap-
propriate agency, and the Board. 
(2) TIME LIMITATIONS FOR ACTIONS.— 
(A) IN
GENERAL.—Except as provided 
under subparagraph (B), the inspector general 
shall make a determination that a complaint is 
frivolous or submit a report under paragraph 
(1) within 180 days after receiving the com-
plaint. 
(B) EXTENSION.—If the inspector general 
is unable to complete an investigation in time to 
submit a report within the 180-day period spec-
ified under subparagraph (A) and the person 
submitting the complaint agrees to an extension 
of time, the inspector general shall submit a re-
port under paragraph (1) within such additional 
period of time as shall be agreed upon between 
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AMDT. NO. 570 
the inspector general and the person submitting 
the complaint. 
(c) REMEDY AND ENFORCEMENT AUTHORITY.— 
(1) AGENCY ACTION.—Not later than 30 days 
after receiving an inspector general report under 
subsection (b), the head of the agency concerned 
shall determine whether there is sufficient basis to 
conclude that the non-Federal employer has sub-
jected the complainant to a reprisal prohibited by 
subsection (a) and shall either issue an order deny-
ing relief or shall take 1 or more of the following ac-
tions: 
(A) Order the employer to take affirmative 
action to abate the reprisal. 
(B) Order the employer to reinstate the 
person to the position that the person held be-
fore the reprisal, together with the compensa-
tion (including back pay), employment benefits, 
and other terms and conditions of employment 
that would apply to the person in that position 
if the reprisal had not been taken. 
(C) Order the employer to pay the com-
plainant an amount equal to the aggregate 
amount of all costs and expenses (including at-
torneys’ fees and expert witnesses’ fees) that 
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AMDT. NO. 570 
were reasonably incurred by the complainant 
for, or in connection with, bringing the com-
plaint regarding the reprisal, as determined by 
the head of the agency. 
(2) CIVIL ACTION.—If the head of an agency 
issues an order denying relief under paragraph (1) 
or has not issued an order within 210 days after the 
submission of a complaint under subsection (b), or 
in the case of an extension of time under subsection 
(b)(2)(B), not later than 30 days after the expira-
tion of the extension of time, and there is no show-
ing that such delay is due to the bad faith of the 
complainant, the complainant shall be deemed to 
have exhausted all administrative remedies with re-
spect to the complaint, and the complainant may 
bring a de novo action at law or equity against the 
employer to seek compensatory damages and other 
relief available under this section in the appropriate 
district court of the United States, which shall have 
jurisdiction over such an action without regard to 
the amount in controversy. Such an action shall, at 
the request of either party to the action, be tried by 
the court with a jury. 
(3) EVIDENCE.—An inspector general deter-
mination and an agency head order denying relief 
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AMDT. NO. 570 
under paragraph (2) shall be admissible in evidence 
in any de novo action at law or equity brought in ac-
cordance with this subsection. 
(4) JUDICIAL
ENFORCEMENT
OF
ORDER.— 
Whenever a person fails to comply with an order 
issued under paragraph (1), the head of the agency 
shall file an action for enforcement of such order in 
the United States district court for a district in 
which the reprisal was found to have occurred. In 
any action brought under this paragraph, the court 
may grant appropriate relief, including injunctive re-
lief and compensatory and exemplary damages. 
(5) JUDICIAL REVIEW.—Any person adversely 
affected or aggrieved by an order issued under para-
graph (1) may obtain review of the order’s conform-
ance with this subsection, and any regulations issued 
to carry out this section, in the United States court 
of appeals for a circuit in which the reprisal is al-
leged in the order to have occurred. No petition 
seeking such review may be filed more than 60 days 
after issuance of the order by the head of the agen-
cy. Review shall conform to chapter 7 of title 5, 
United States Code. 
(d) RULE OF CONSTRUCTION.—Nothing in this sec-
tion may be construed to authorize the discharge of, demo-
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AMDT. NO. 570 
tion of, or discrimination against an employee for a disclo-
sure other than a disclosure protected by subsection (a) 
or to modify or derogate from a right or remedy otherwise 
available to the employee. 
SEC. 1519. BOARD WEBSITE. 
(a) ESTABLISHMENT.—The Board shall establish and 
maintain a user-friendly, public-facing website to foster 
greater accountability and transparency in the use of cov-
ered funds. 
(b) PURPOSE.—The website established and main-
tained under subsection (a) shall be a portal or gateway 
to key information relating to this Act and provide connec-
tions to other Government websites with related informa-
tion. 
(c) CONTENT AND FUNCTION.—In establishing the 
website established and maintained under subsection (a), 
the Board shall ensure the following: 
(1) The website shall provide materials explain-
ing what this Act means for citizens. The materials 
shall be easy to understand and regularly updated. 
(2) The website shall provide accountability in-
formation, including a database of findings from au-
dits, inspectors general, and the Government Ac-
countability Office. 
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AMDT. NO. 570 
(3) The website shall provide data on relevant 
economic, financial, grant, and contract information 
in user-friendly visual presentations to enhance pub-
lic awareness of the use of covered funds. 
(4) The website shall provide detailed data on 
contracts awarded by the Government that expend 
covered funds, including information about the com-
petitiveness of the contracting process, notification 
of solicitations for contracts to be awarded, and in-
formation about the process that was used for the 
award of contracts. 
(5) The website shall include printable reports 
on covered funds obligated by month to each State 
and congressional district. 
(6) The website shall provide a means for the 
public to give feedback on the performance of con-
tracts that expend covered funds. 
(7) The website shall be enhanced and updated 
as necessary to carry out the purposes of this sub-
title. 
(d) WAIVER.—The Board may exclude posting con-
tractual or other information on the website on a case- 
by-case basis when necessary to protect national security. 
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AMDT. NO. 570 
SEC. 1520. AUTHORIZATION OF APPROPRIATIONS. 
There are authorized to be appropriated such sums 
as necessary to carry out this subtitle. 
SEC. 1521. TERMINATION OF THE BOARD. 
The Board shall terminate on September 30, 2012. 
Subtitle B—Recovery Independent 
Advisory Panel 
SEC. 1531. ESTABLISHMENT OF RECOVERY INDEPENDENT 
ADVISORY PANEL. 
(a) ESTABLISHMENT.—There is established the Re-
covery Independent Advisory Panel. 
(b) MEMBERSHIP.—The Panel shall be composed of 
5 members who shall be appointed by the President. 
(c) QUALIFICATIONS.—Members shall be appointed 
on the basis of expertise in economics, public finance, con-
tracting, accounting, or any other relevant field. 
(d) INITIAL MEETING.—Not later than 30 days after 
the date on which all members of the Panel have been 
appointed, the Panel shall hold its first meeting. 
(e) MEETINGS.—The Panel shall meet at the call of 
the Chairperson of the Panel. 
(f) QUORUM.—A majority of the members of the 
Panel shall constitute a quorum, but a lesser number of 
members may hold hearings. 
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AMDT. NO. 570 
(g) CHAIRPERSON AND VICE CHAIRPERSON.—The 
Panel shall select a Chairperson and Vice Chairperson 
from among its members. 
SEC. 1532. DUTIES OF THE PANEL. 
The Panel shall make recommendations to the Board 
on actions the Board could take to prevent fraud, waste, 
and abuse relating to covered funds. 
SEC. 1533. POWERS OF THE PANEL. 
(a) HEARINGS.—The Panel may hold such hearings, 
sit and act at such times and places, take such testimony, 
and receive such evidence as the Panel considers advisable 
to carry out this subtitle. 
(b) INFORMATION FROM FEDERAL AGENCIES.—The 
Panel may secure directly from any agency such informa-
tion as the Panel considers necessary to carry out this sub-
title. Upon request of the Chairperson of the Panel, the 
head of such agency shall furnish such information to the 
Panel. 
(c) POSTAL SERVICES.—The Panel may use the 
United States mails in the same manner and under the 
same conditions as agencies of the Federal Government. 
(d) GIFTS.—The Panel may accept, use, and dispose 
of gifts or donations of services or property. 
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AMDT. NO. 570 
SEC. 1534. PANEL PERSONNEL MATTERS. 
(a) COMPENSATION OF MEMBERS.—Each member of 
the Panel who is not an officer or employee of the Federal 
Government shall be compensated at a rate equal to the 
daily equivalent of the annual rate of basic pay prescribed 
for level IV of the Executive Schedule under section 5315 
of title 5, United States Code, for each day (including 
travel time) during which such member is engaged in the 
performance of the duties of the Panel. All members of 
the Panel who are officers or employees of the United 
States shall serve without compensation in addition to that 
received for their services as officers or employees of the 
United States. 
(b) TRAVEL EXPENSES.—The members of the Panel 
shall be allowed travel expenses, including per diem in lieu 
of subsistence, at rates authorized for employees of agen-
cies under subchapter I of chapter 57 of title 5, United 
States Code, while away from their homes or regular 
places of business in the performance of services for the 
Panel. 
(c) STAFF.— 
(1) IN
GENERAL.—The Chairperson of the 
Panel may, without regard to the civil service laws 
and regulations, appoint and terminate an executive 
director and such other additional personnel as may 
be necessary to enable the Panel to perform its du-
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ties. The employment of an executive director shall 
be subject to confirmation by the Panel. 
(2) COMPENSATION.—The Chairperson of the 
Panel may fix the compensation of the executive di-
rector and other personnel without regard to chapter 
51 and subchapter III of chapter 53 of title 5, 
United States Code, relating to classification of posi-
tions and General Schedule pay rates, except that 
the rate of pay for the executive director and other 
personnel may not exceed the rate payable for level 
V of the Executive Schedule under section 5316 of 
such title. 
(3) PERSONNEL AS FEDERAL EMPLOYEES.— 
(A) IN GENERAL.—The executive director 
and any personnel of the Panel who are employ-
ees shall be employees under section 2105 of 
title 5, United States Code, for purposes of 
chapters 63, 81, 83, 84, 85, 87, 89, 89A, 89B, 
and 90 of that title. 
(B) MEMBERS OF PANEL.—Subparagraph 
(A) shall not be construed to apply to members 
of the Panel. 
(d) DETAIL
OF GOVERNMENT EMPLOYEES.—Any 
Federal Government employee may be detailed to the 
Panel without reimbursement, and such detail shall be 
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AMDT. NO. 570 
without interruption or loss of civil service status or privi-
lege. 
(e) PROCUREMENT OF TEMPORARY AND INTERMIT-
TENT SERVICES.—The Chairperson of the Panel may pro-
cure temporary and intermittent services under section 
3109(b) of title 5, United States Code, at rates for individ-
uals which do not exceed the daily equivalent of the annual 
rate of basic pay prescribed for level V of the Executive 
Schedule under section 5316 of such title. 
(f) ADMINISTRATIVE SUPPORT.—The General Serv-
ices Administration shall provide the Board with adminis-
trative support services, including the provision of office 
space and facilities. 
SEC. 1535. TERMINATION OF THE PANEL. 
The Panel shall terminate on September 30, 2012. 
SEC. 1536. AUTHORIZATION OF APPROPRIATIONS. 
There are authorized to be appropriated such sums 
as necessary to carry out this subtitle. 
Subtitle C—Reports of the Council 
of Economic Advisers 
SEC. 1541. REPORTS OF THE COUNCIL OF ECONOMIC AD-
VISERS. 
(a) IN GENERAL.—In consultation with the Director 
of the Office of Management and Budget and the Sec-
retary of the Treasury, the Chairperson of the Council of 
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Economic Advisers shall submit to the Committees on Ap-
propriations of the Senate and House of Representatives 
quarterly reports based on the reports required under sec-
tion 1551 that detail the impact of programs funded 
through covered funds on employment, estimated eco-
nomic growth, and other key economic indicators. 
(b) SUBMISSION OF REPORTS.— 
(1) FIRST REPORT.—The first report submitted 
under subsection (a) shall be submitted not later 
than 45 days after the end of the first full quarter 
following the date of enactment of this Act. 
(2) LAST REPORT.—The last report required to 
be submitted under subsection (a) shall apply to the 
quarter in which the Board terminates under section 
1521. 
Subtitle D—Reports on Use of 
Funds 
SEC. 1551. REPORTS ON USE OF FUNDS. 
(a) SHORT TITLE.—This section may be cited as the 
‘‘Jobs Accountability Act’’. 
(b) DEFINITIONS.—In this section: 
(1) AGENCY.—The term ‘‘agency’’ has the 
meaning given under section 551 of title 5, United 
States Code. 
(2) RECIPIENT.—The term ‘‘recipient’’— 
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(A) means any entity that receives recovery 
funds 
(including 
recovery 
funds 
received 
through grant, loan, or contract) other than an 
individual; and 
(B) includes a State that receives recovery 
funds. 
(3) RECOVERY
FUNDS.—The term ‘‘recovery 
funds’’ means any funds that are made available— 
(A) from appropriations made under this 
Act; and 
(B) under any other authorities provided 
under this Act. 
(c) RECIPIENT REPORTS.—Not later than 10 days 
after the end of each calendar quarter, each recipient that 
received recovery funds from an agency shall submit a re-
port to that agency that contains— 
(1) the total amount of recovery funds received 
from that agency; 
(2) the amount of recovery funds received that 
were expended or obligated to projects or activities; 
and 
(3) a detailed list of all projects or activities for 
which recovery funds were expended or obligated, in-
cluding— 
(A) the name of the project or activity; 
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AMDT. NO. 570 
(B) a description of the project or activity; 
(C) an evaluation of the completion status 
of the project or activity; and 
(D) an analysis of the number of jobs cre-
ated and the number of jobs retained by the 
project or activity. 
(d) AGENCY REPORTS.—Not later than 30 days after 
the end of each calendar quarter, each agency that made 
recovery funds available to any recipient shall make the 
information in reports submitted under subsection (c) 
publicly available by posting the information on a website. 
(e) OTHER REPORTS.—The Congressional Budget 
Office and the Government Accountability Office shall 
comment on the information described in subsection 
(c)(3)(D) for any reports submitted under subsection (c). 
Such comments shall be due within 7 days after such re-
ports are submitted. 
TITLE XVI—GENERAL PROVISIONS—THIS ACT 
EMERGENCY DESIGNATION 
SEC. 1601. Each amount in this Act is designated 
as an emergency requirement and necessary to meet emer-
gency needs pursuant to section 204(a) of S. Con. Res. 
21 (110th Congress) and section 301(b)(2) of S. Con. Res. 
70 (110th Congress), the concurrent resolutions on the 
budget for fiscal years 2008 and 2009. 
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AVAILABILITY 
SEC. 1602. No part of any appropriation contained 
in this Act shall remain available for obligation beyond 
the current fiscal year unless expressly so provided herein. 
RELATIONSHIP TO OTHER APPROPRIATIONS 
SEC. 1603. Each amount appropriated or made avail-
able in this Act is in addition to amounts otherwise appro-
priated for the fiscal year involved. Enactment of this Act 
shall have no effect on the availability of amounts under 
the Continuing Appropriations Resolution, 2009 (division 
A of Public Law 110–329). 
BUY AMERICAN 
SEC. 1604. USE OF AMERICAN IRON, STEEL, AND 
MANUFACTURED GOODS. (a) None of the funds appro-
priated or otherwise made available by this Act may be 
used for a project for the construction, alteration, mainte-
nance, or repair of a public building or public work unless 
all of the iron, steel, and manufactured goods used in the 
project are produced in the United States. 
(b) Subsection (a) shall not apply in any case in 
which the head of the Federal department or agency in-
volved finds that— 
(1) applying subsection (a) would be incon-
sistent with the public interest; 
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AMDT. NO. 570 
(2) iron, steel, and the relevant manufactured 
goods are not produced in the United States if suffi-
cient and reasonably available quantities and of a 
satisfactory quality; or 
(3) inclusion of iron, steel, and manufactured 
goods produced in the United States will increase 
the cost of the overall project by more than 25 per-
cent. 
(c) If the head of a Federal department or agency 
determines that it is necessary to waive the application 
of subsection (a) based on a finding under subsection (b), 
the head of the department or agency shall publish in the 
Federal Register a detailed written jurisdiction as to why 
the provision is being waived. 
(d) This section shall be applied in a manner con-
sistent with United States obligations under international 
agreements. 
CERTIFICATION 
SEC. 1605. With respect to funds in titles I though 
XVI of this Act made available to State, or local govern-
ment agencies, the Governor, mayor, or other chief execu-
tive, as appropriate, shall certify that the infrastructure 
investment has received the full review and vetting re-
quired by law and that the chief executive accepts respon-
sibility that the infrastructure investment is an appro-
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AMDT. NO. 570 
priate use of taxpayer dollars. A State or local agency may 
not receive infrastructure investment funding from funds 
made available in this Act unless this certification is made. 
ECONOMIC STABILIZATION CONTRACTING 
SEC. 1606. REFORM OF CONTRACTING PROCEDURES 
UNDER EESA. Section 107(b) of the Emergency Eco-
nomic Stabilization Act of 2008 (12 U.S.C. 5217(b)) is 
amended by inserting ‘‘and individuals with disabilities 
and businesses owned by individuals with disabilities (for 
purposes of this subsection the term ‘individual with dis-
ability’ has the same meaning as the term ‘handicapped 
individual’ as that term is defined in section 3(f) of the 
Small Business Act (15 U.S.C. 632(f)),’’ after ‘‘(12 
U.S.C. 1441a(r)(4)),’’. 
SEC. 1607. FINDINGS.— 
(1) The National Environmental Policy Act pro-
tects public health, safety and environmental quality: 
by ensuring transparency, accountability and public 
involvement in federal actions and in the use of pub-
lic funds; 
(2) When President Nixon signed the National 
Environmental Policy Act into law on January 1, 
1970, he said that the Act provided the ‘‘direction’’ 
for the country to ‘‘regain a productive harmony be-
tween man and nature’’; 
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414 
AMDT. NO. 570 
(3) The National Environmental Policy Act 
helps to provide an orderly process for considering 
federal actions and funding decisions and prevents 
ligation and delay that would otherwise be inevitable 
and existed prior to the establishment of the Na-
tional Environmental Policy Act. 
(a) Adequate resources within this bill must be de-
voted to ensuring that applicable environmental reviews 
under the National Environmental Policy Act are com-
pleted on an expeditious basis and that the shortest exist-
ing applicable process under the National Environmental 
Policy Act shall be utilized. 
(b) The President shall report to the Senate Environ-
ment and Public Works Committee and the House Nat-
ural Resources Committee every 90 days following the 
date of enactment until September 30, 2011 on the status 
and progress of projects and activities funded by this Act 
with respect to compliance with National Environmental 
Policy Act requirements and documentation. 
PROHIBITION ON NO-BID CONTRACTS AND EARMARKS 
SEC. 1608. (a) Notwithstanding any other provision 
of this Act, none of the funds appropriated or otherwise 
made available by this Act may be used to make any pay-
ment in connection with a contract unless the contract is 
awarded using competitive procedures in accordance with 
the requirements of section 303 of the Federal Property 
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AMDT. NO. 570 
and Administrative Services Act of 1949 (41 U.S.C. 253), 
section 2304 of title 10, United States Code, and the Fed-
eral Acquisition Regulation. 
(b) Notwithstanding any other provision of this Act, 
none of the funds appropriated or otherwise made avail-
able by this Act may be awarded by grant or cooperative 
agreement unless the process used to award such grant 
or cooperative agreement uses competitive procedures to 
select the grantee or award recipient. 
SEC. 1609. LIMIT ON FUNDS. 
None of the amounts appropriated or otherwise made 
available by this Act may be used for any casino or other 
gambling establishment, aquarium, zoo, golf course, swim-
ming pool, stadium, community park, museum, theater, 
art center, and highway beautification project. 
SEC. 1610. HIRING AMERICAN WORKERS IN COMPANIES 
RECEIVING TARP FUNDING. 
(a) SHORT TITLE.—This section may be cited as the 
‘‘Employ American Workers Act’’. 
(b) PROHIBITION.— 
(1) IN GENERAL.—Notwithstanding any other 
provision of law, it shall be unlawful for any recipi-
ent of funding under title I of the Emergency Eco-
nomic Stabilization Act of 2008 (Public Law 110– 
343) or section 13 of the Federal Reserve Act (12 
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AMDT. NO. 570 
U.S.C. 342 et seq.) to hire any nonimmigrant de-
scribed in section 101(a)(15)(h)(i)(b) of the Immi-
gration 
and 
Nationality 
Act 
(8 
U.S.C. 
1101(a)(15)(h)(i)(b)) unless the recipient is in com-
pliance with the requirements for an H–1B depend-
ent employer (as defined in section 212(n)(3) of 
such Act (8 U.S.C. 1182(n)(3))), except that the 
second sentence of section 212(n)(1)(E)(ii) of such 
Act shall not apply. 
(2) DEFINED TERM.—In this subsection, the 
term ‘‘hire’’ means to permit a new employee to 
commence a period of employment. 
(c) SUNSET PROVISION.—This section shall be effec-
tive during the 2-year period beginning on the date of the 
enactment of this Act. 
DIVISION 
B—TAX, 
UNEMPLOY-
MENT, HEALTH, STATE FIS-
CAL 
RELIEF, 
AND 
OTHER 
PROVISIONS 
TITLE I—TAX PROVISIONS 
SEC. 1000. SHORT TITLE, ETC. 
(a) SHORT TITLE.—This title may be cited as the 
‘‘American Recovery and Reinvestment Tax Act of 2009’’. 
(b) REFERENCE.—Except as otherwise expressly pro-
vided, whenever in this title an amendment or repeal is 
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417 
AMDT. NO. 570 
expressed in terms of an amendment to, or repeal of, a 
section or other provision, the reference shall be consid-
ered to be made to a section or other provision of the In-
ternal Revenue Code of 1986. 
(c) TABLE OF CONTENTS.—The table of contents for 
this title is as follows: 
TITLE I—TAX PROVISIONS 
Sec. 1000. Short title, etc. 
Subtitle A—Tax Relief for Individuals and Families 
PART I—GENERAL TAX RELIEF 
Sec. 1001. Making work pay credit. 
Sec. 1002. Temporary increase in earned income tax credit. 
Sec. 1003. Temporary increase of refundable portion of child credit. 
Sec. 1004. American opportunity tax credit. 
Sec. 1005. Computer technology and equipment allowed as a qualified higher 
education expense for section 529 accounts in 2009 and 2010. 
Sec. 1006. Credit for certain home purchases. 
Sec. 1007. Suspension of tax on portion of unemployment compensation. 
Sec. 1008. Above-the-line deduction for interest on indebtedness with respect to 
the purchase of certain motor vehicles. 
Sec. 1009. Above-the-line deduction for State sales tax and excise tax on the 
purchase of certain motor vehicles. 
PART II—ALTERNATIVE MINIMUM TAX RELIEF 
Sec. 1011. Extension of alternative minimum tax relief for nonrefundable per-
sonal credits. 
Sec. 1012. Extension of increased alternative minimum tax exemption amount. 
Subtitle B—Energy Incentives 
PART I—RENEWABLE ENERGY INCENTIVES 
Sec. 1101. Extension of credit for electricity produced from certain renewable 
resources. 
Sec. 1102. Election of investment credit in lieu of production credit. 
Sec. 1103. Repeal of certain limitations on credit for renewable energy prop-
erty. 
PART II—INCREASED ALLOCATIONS OF NEW CLEAN RENEWABLE ENERGY 
BONDS AND QUALIFIED ENERGY CONSERVATION BONDS 
Sec. 1111. Increased limitation on issuance of new clean renewable energy 
bonds. 
Sec. 1112. Increased limitation on issuance of qualified energy conservation 
bonds. 
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418 
AMDT. NO. 570 
PART III—ENERGY CONSERVATION INCENTIVES 
Sec. 1121. Extension and modification of credit for nonbusiness energy prop-
erty. 
Sec. 1122. Modification of credit for residential energy efficient property. 
Sec. 1123. Temporary increase in credit for alternative fuel vehicle refueling 
property. 
PART IV—ENERGY RESEARCH INCENTIVES 
Sec. 1131. Increased research credit for energy research. 
PART V—MODIFICATION OF CREDIT FOR CARBON DIOXIDE SEQUESTRATION 
Sec. 1141. Application of monitoring requirements to carbon dioxide used as a 
tertiary injectant. 
PART VI—PLUG-IN ELECTRIC DRIVE MOTOR VEHICLES 
Sec. 1151. Modification of credit for qualified plug-in electric motor vehicles. 
Subtitle C—Tax Incentives for Business 
PART I—TEMPORARY INVESTMENT INCENTIVES 
Sec. 1201. Special allowance for certain property acquired during 2009. 
Sec. 1202. Temporary increase in limitations on expensing of certain depre-
ciable business assets. 
PART II—5-YEAR CARRYBACK OF OPERATING LOSSES 
Sec. 1211. 5-year carryback of operating losses. 
Sec. 1212. Exception for TARP recipients. 
PART III—INCENTIVES FOR NEW JOBS 
Sec. 1221. Incentives to hire unemployed veterans and disconnected youth. 
PART IV—CANCELLATION OF INDEBTEDNESS 
Sec. 1231. Deferral and ratable inclusion of income arising from indebtedness 
discharged by the repurchase of a debt instrument. 
PART V—QUALIFIED SMALL BUSINESS STOCK 
Sec. 1241. Special rules applicable to qualified small business stock for 2009 
and 2010. 
PART VI—PARITY FOR TRANSPORTATION FRINGE BENEFITS 
Sec. 1251. Increased exclusion amount for commuter transit benefits and tran-
sit passes. 
PART VII—S CORPORATIONS 
Sec. 1261. Temporary reduction in recognition period for built-in gains tax. 
PART VIII—BROADBAND INCENTIVES 
Sec. 1271. Broadband Internet access tax credit. 
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419 
AMDT. NO. 570 
PART IX—CLARIFICATION OF REGULATIONS RELATED TO LIMITATIONS ON 
CERTAIN BUILT-IN LOSSES FOLLOWING AN OWNERSHIP CHANGE 
Sec. 1281. Clarification of regulations related to limitations on certain built-in 
losses following an ownership change. 
Subtitle D—Manufacturing Recovery Provisions 
Sec. 1301. Temporary expansion of availability of industrial development bonds 
to facilities manufacturing intangible property. 
Sec. 1302. Credit for investment in advanced energy facilities. 
Subtitle E—Economic Recovery Tools 
Sec. 1401. Recovery zone bonds. 
Sec. 1402. Tribal economic development bonds. 
Sec. 1403. Modifications to new markets tax credit. 
Subtitle F—Infrastructure Financing Tools 
PART I—IMPROVED MARKETABILITY FOR TAX-EXEMPT BONDS 
Sec. 1501. De minimis safe harbor exception for tax-exempt interest expense of 
financial institutions. 
Sec. 1502. Modification of small issuer exception to tax-exempt interest expense 
allocation rules for financial institutions. 
Sec. 1503. Temporary modification of alternative minimum tax limitations on 
tax-exempt bonds. 
Sec. 1504. Modification to high speed intercity rail facility bonds. 
PART II—DELAY IN APPLICATION OF WITHHOLDING TAX ON GOVERNMENT 
CONTRACTORS 
Sec. 1511. Delay in application of withholding tax on government contractors. 
PART III—TAX CREDIT BONDS FOR SCHOOLS 
Sec. 1521. Qualified school construction bonds. 
Sec. 1522. Extension and expansion of qualified zone academy bonds. 
PART IV—BUILD AMERICA BONDS 
Sec. 1531. Build America bonds. 
Subtitle G—Economic Recovery Payments to Certain Individuals 
Sec. 1601. Economic recovery payment to recipients of Social Security, supple-
mental security income, railroad retirement benefits, and vet-
erans disability compensation or pension benefits. 
Subtitle H—Trade Adjustment Assistance 
Sec. 1701. Temporary extension of Trade Adjustment Assistance program. 
Subtitle I—Prohibition on Collection of Certain Payments Made Under the 
Continued Dumping and Subsidy Offset Act of 2000 
Sec. 1801. Prohibition on collection of certain payments made under the Con-
tinued Dumping and Subsidy Offset Act of 2000. 
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AMDT. NO. 570 
Subtitle J—Other Provisions 
Sec. 1901. Application of certain labor standards to projects financed with cer-
tain tax-favored bonds. 
Sec. 1902. Increase in public debt limit. 
Sec. 1903. Election to accelerate the low-income housing tax credit. 
Subtitle A—Tax Relief for 
Individuals and Families 
PART I—GENERAL TAX RELIEF 
SEC. 1001. MAKING WORK PAY CREDIT. 
(a) IN GENERAL.—Subpart C of part IV of sub-
chapter A of chapter 1 is amended by inserting after sec-
tion 36 the following new section: 
‘‘SEC. 36A. MAKING WORK PAY CREDIT. 
‘‘(a) ALLOWANCE OF CREDIT.—In the case of an eli-
gible individual, there shall be allowed as a credit against 
the tax imposed by this subtitle for the taxable year an 
amount equal to the lesser of— 
‘‘(1) 6.2 percent of earned income of the tax-
payer, or 
‘‘(2) $500 ($1,000 in the case of a joint re-
turn). 
‘‘(b) LIMITATION BASED ON MODIFIED ADJUSTED 
GROSS INCOME.— 
‘‘(1) IN GENERAL.—The amount allowable as a 
credit under subsection (a) (determined without re-
gard to this paragraph and subsection (c)) for the 
taxable year shall be reduced (but not below zero) by 
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AMDT. NO. 570 
4 percent of so much of the taxpayer’s modified ad-
justed gross income as exceeds $70,000 ($140,000 
in the case of a joint return). 
‘‘(2) MODIFIED
ADJUSTED
GROSS
INCOME.— 
For purposes of subparagraph (A), the term ‘modi-
fied adjusted gross income’ means the adjusted 
gross income of the taxpayer for the taxable year in-
creased by any amount excluded from gross income 
under section 911, 931, or 933. 
‘‘(c) REDUCTION
FOR
CERTAIN
OTHER
PAY-
MENTS.—The credit allowed under subsection (a) for any 
taxable year shall be reduced by the amount of any pay-
ments received by the taxpayer during such taxable year 
under section 1601 of the American Recovery and Rein-
vestment Tax Act of 2009. 
‘‘(d) DEFINITIONS.—For purposes of this section— 
‘‘(1) ELIGIBLE INDIVIDUAL.—The term ‘eligible 
individual’ means any individual other than— 
‘‘(A) any nonresident alien individual, 
‘‘(B) any individual with respect to whom 
a deduction under section 151 is allowable to 
another taxpayer for a taxable year beginning 
in the calendar year in which the individual’s 
taxable year begins, and 
‘‘(C) an estate or trust. 
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AMDT. NO. 570 
Such term shall not include any individual unless the 
requirements of section 32(c)(1)(E) are met with re-
spect to such individual. 
‘‘(2) EARNED INCOME.—The term ‘earned in-
come’ has the meaning given such term by section 
32(c)(2), except that such term shall not include net 
earnings from self-employment which are not taken 
into account in computing taxable income. For pur-
poses of the preceding sentence, any amount ex-
cluded from gross income by reason of section 112 
shall be treated as earned income which is taken 
into account in computing taxable income for the 
taxable year. 
‘‘(e) TERMINATION.—This section shall not apply to 
taxable years beginning after December 31, 2010.’’. 
(b) TREATMENT OF POSSESSIONS.— 
(1) PAYMENTS TO POSSESSIONS.— 
(A) MIRROR CODE POSSESSION.—The Sec-
retary of the Treasury shall pay to each posses-
sion of the United States with a mirror code 
tax system amounts equal to the loss to that 
possession by reason of the amendments made 
by this section with respect to taxable years be-
ginning in 2009 and 2010. Such amounts shall 
be determined by the Secretary of the Treasury 
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AMDT. NO. 570 
based on information provided by the govern-
ment of the respective possession. 
(B) OTHER POSSESSIONS.—The Secretary 
of the Treasury shall pay to each possession of 
the United States which does not have a mirror 
code tax system amounts estimated by the Sec-
retary of the Treasury as being equal to the ag-
gregate benefits that would have been provided 
to residents of such possession by reason of the 
amendments made by this section for taxable 
years beginning in 2009 and 2010 if a mirror 
code tax system had been in effect in such pos-
session. The preceding sentence shall not apply 
with respect to any possession of the United 
States unless such possession has a plan, which 
has been approved by the Secretary of the 
Treasury, under which such possession will 
promptly distribute such payments to the resi-
dents of such possession. 
(2) COORDINATION
WITH
CREDIT
ALLOWED 
AGAINST UNITED STATES INCOME TAXES.—No cred-
it shall be allowed against United States income 
taxes for any taxable year under section 36A of the 
Internal Revenue Code of 1986 (as added by this 
section) to any person— 
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AMDT. NO. 570 
(A) to whom a credit is allowed against 
taxes imposed by the possession by reason of 
the amendments made by this section for such 
taxable year, or 
(B) who is eligible for a payment under a 
plan described in paragraph (1)(B) with respect 
to such taxable year. 
(3) DEFINITIONS AND SPECIAL RULES.— 
(A) 
POSSESSION
OF
THE
UNITED 
STATES.—For purposes of this subsection, the 
term ‘‘possession of the United States’’ includes 
the Commonwealth of Puerto Rico and the 
Commonwealth of the Northern Mariana Is-
lands. 
(B) MIRROR CODE TAX SYSTEM.—For pur-
poses of this subsection, the term ‘‘mirror code 
tax system’’ means, with respect to any posses-
sion of the United States, the income tax sys-
tem of such possession if the income tax liabil-
ity of the residents of such possession under 
such system is determined by reference to the 
income tax laws of the United States as if such 
possession were the United States. 
(C) TREATMENT OF PAYMENTS.—For pur-
poses of section 1324(b)(2) of title 31, United 
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AMDT. NO. 570 
States Code, the payments under this sub-
section shall be treated in the same manner as 
a refund due from the credit allowed under sec-
tion 36A of the Internal Revenue Code of 1986 
(as added by this section). 
(c) REFUNDS DISREGARDED IN THE ADMINISTRA-
TION
OF FEDERAL PROGRAMS
AND FEDERALLY AS-
SISTED PROGRAMS.—Any credit or refund allowed or 
made to any individual by reason of section 36A of the 
Internal Revenue Code of 1986 (as added by this section) 
or by reason of subsection (b) of this section shall not be 
taken into account as income and shall not be taken into 
account as resources for the month of receipt and the fol-
lowing 2 months, for purposes of determining the eligi-
bility of such individual or any other individual for benefits 
or assistance, or the amount or extent of benefits or assist-
ance, under any Federal program or under any State or 
local program financed in whole or in part with Federal 
funds. 
(d) AUTHORITY RELATING TO CLERICAL ERRORS.— 
Section 6213(g)(2) is amended by striking ‘‘and’’ at the 
end of subparagraph (L)(ii), by striking the period at the 
end of subparagraph (M) and inserting ‘‘, and’’, and by 
adding at the end the following new subparagraph: 
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426 
AMDT. NO. 570 
‘‘(N) an omission of the reduction required 
under section 36A(c) with respect to the credit 
allowed under section 36A or an omission of the 
correct 
TIN 
required 
under 
section 
36A(d)(1).’’. 
(e) CONFORMING AMENDMENTS.— 
(1) Section 6211(b)(4)(A) is amended by insert-
ing ‘‘36A,’’ after ‘‘36,’’. 
(2) Section 1324(b)(2) of title 31, United 
States Code, is amended by inserting ‘‘36A,’’ after 
‘‘36,’’. 
(3) The table of sections for subpart C of part 
IV of subchapter A of chapter 1 is amended by in-
serting after the item relating to section 36 the fol-
lowing new item: 
‘‘Sec. 36A. Making work pay credit.’’. 
(f) EFFECTIVE DATE.—This section, and the amend-
ments made by this section, shall apply to taxable years 
beginning after December 31, 2008. 
SEC. 1002. TEMPORARY INCREASE IN EARNED INCOME TAX 
CREDIT. 
(a) IN GENERAL.—Subsection (b) of section 32 is 
amended by adding at the end the following new para-
graph: 
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427 
AMDT. NO. 570 
‘‘(3) SPECIAL RULES FOR 2009 AND 2010.—In 
the case of any taxable year beginning in 2009 or 
2010— 
‘‘(A) INCREASED
CREDIT
PERCENTAGE 
FOR 3 OR MORE QUALIFYING CHILDREN.—In 
the case of a taxpayer with 3 or more qualifying 
children, the credit percentage is 45 percent. 
‘‘(B) REDUCTION
OF
MARRIAGE
PEN-
ALTY.— 
‘‘(i) IN GENERAL.—The dollar amount 
in effect under paragraph (2)(B) shall be 
$5,000. 
‘‘(ii) INFLATION
ADJUSTMENT.—In 
the case of any taxable year beginning in 
2010, the $5,000 amount in clause (i) 
shall be increased by an amount equal to— 
‘‘(I) such dollar amount, multi-
plied by 
‘‘(II) the cost of living adjust-
ment determined under section 1(f)(3) 
for the calendar year in which the tax-
able year begins determined by sub-
stituting ‘calendar year 2008’ for ‘cal-
endar year 1992’ in subparagraph (B) 
thereof. 
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AMDT. NO. 570 
‘‘(iii) ROUNDING.—Subparagraph (A) 
of subsection (j)(2) shall apply after taking 
into account any increase under clause 
(ii).’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
SEC. 1003. TEMPORARY INCREASE OF REFUNDABLE POR-
TION OF CHILD CREDIT. 
(a) IN GENERAL.—Paragraph (4) of section 24(d) is 
amended to read as follows: 
‘‘(4) SPECIAL RULE FOR 2009 AND 2010.—Not-
withstanding paragraph (3), in the case of any tax-
able year beginning in 2009 or 2010, the dollar 
amount in effect for such taxable year under para-
graph (1)(B)(i) shall be $8,100.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
SEC. 1004. AMERICAN OPPORTUNITY TAX CREDIT. 
(a) IN GENERAL.—Section 25A (relating to Hope 
scholarship credit) is amended by redesignating subsection 
(i) as subsection (j) and by inserting after subsection (h) 
the following new subsection: 
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AMDT. NO. 570 
‘‘(i) AMERICAN OPPORTUNITY TAX CREDIT.—In the 
case of any taxable year beginning in 2009 or 2010— 
‘‘(1) INCREASE IN CREDIT.—The Hope Scholar-
ship Credit shall be an amount equal to the sum 
of— 
‘‘(A) 100 percent of so much of the quali-
fied tuition and related expenses paid by the 
taxpayer during the taxable year (for education 
furnished to the eligible student during any 
academic period beginning in such taxable year) 
as does not exceed $2,000, plus 
‘‘(B) 25 percent of such expenses so paid 
as exceeds $2,000 but does not exceed $4,000. 
‘‘(2) CREDIT ALLOWED FOR FIRST 4 YEARS OF 
POST-SECONDARY EDUCATION.—Subparagraphs (A) 
and (C) of subsection (b)(2) shall be applied by sub-
stituting ‘4’ for ‘2’. 
‘‘(3) QUALIFIED
TUITION
AND
RELATED
EX-
PENSES
TO
INCLUDE
REQUIRED
COURSE
MATE-
RIALS.—Subsection (f)(1)(A) shall be applied by 
substituting ‘tuition, fees, and course materials’ for 
‘tuition and fees’. 
‘‘(4) INCREASE
IN
AGI
LIMITS
FOR
HOPE 
SCHOLARSHIP
CREDIT.—In lieu of applying sub-
section (d) with respect to the Hope Scholarship 
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AMDT. NO. 570 
Credit, such credit (determined without regard to 
this paragraph) shall be reduced (but not below 
zero) by the amount which bears the same ratio to 
such credit (as so determined) as— 
‘‘(A) the excess of— 
‘‘(i) the taxpayer’s modified adjusted 
gross income (as defined in subsection 
(d)(3)) for such taxable year, over 
‘‘(ii) $80,000 ($160,000 in the case of 
a joint return), bears to 
‘‘(B) $10,000 ($20,000 in the case of a 
joint return). 
‘‘(5) CREDIT ALLOWED AGAINST ALTERNATIVE 
MINIMUM TAX.—In the case of a taxable year to 
which section 26(a)(2) does not apply, so much of 
the credit allowed under subsection (a) as is attrib-
utable to the Hope Scholarship Credit shall not ex-
ceed the excess of— 
‘‘(A) the sum of the regular tax liability 
(as defined in section 26(b)) plus the tax im-
posed by section 55, over 
‘‘(B) the sum of the credits allowable 
under this subpart (other than this subsection 
and sections 23, 25D, and 30D) and section 27 
for the taxable year. 
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431 
AMDT. NO. 570 
Any reference in this section or section 24, 25, 26, 
25B, 904, or 1400C to a credit allowable under this 
subsection shall be treated as a reference to so much 
of the credit allowable under subsection (a) as is at-
tributable to the Hope Scholarship Credit. 
‘‘(6) PORTION
OF
CREDIT
MADE
REFUND-
ABLE.—30 percent of so much of the credit allowed 
under subsection (a) as is attributable to the Hope 
Scholarship Credit (determined after application of 
paragraph (4) and without regard to this paragraph 
and section 26(a)(2) or paragraph (5), as the case 
may be) shall be treated as a credit allowable under 
subpart C (and not allowed under subsection (a)). 
The preceding sentence shall not apply to any tax-
payer for any taxable year if such taxpayer is a child 
to whom subsection (g) of section 1 applies for such 
taxable year. 
‘‘(7) COORDINATION
WITH
MIDWESTERN
DIS-
ASTER AREA BENEFITS.—In the case of a taxpayer 
with respect to whom section 702(a)(1)(B) of the 
Heartland Disaster Tax Relief Act of 2008 applies 
for any taxable year, such taxpayer may elect to 
waive the application of this subsection to such tax-
payer for such taxable year.’’. 
(b) CONFORMING AMENDMENTS.— 
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432 
AMDT. NO. 570 
(1) Section 24(b)(3)(B) is amended by inserting 
‘‘25A(i),’’ after ‘‘23,’’. 
(2) Section 25(e)(1)(C)(ii) is amended by in-
serting ‘‘25A(i),’’ after ‘‘24,’’. 
(3) Section 26(a)(1) is amended by inserting 
‘‘25A(i),’’ after ‘‘24,’’. 
(4) Section 25B(g)(2) is amended by inserting 
‘‘25A(i),’’ after ‘‘23,’’. 
(5) Section 904(i) is amended by inserting 
‘‘25A(i),’’ after ‘‘24,’’. 
(6) Section 1400C(d)(2) is amended by insert-
ing ‘‘25A(i),’’ after ‘‘24,’’. 
(7) Section 1324(b)(2) of title 31, United 
States Code, is amended by inserting ‘‘25A,’’ before 
‘‘35’’. 
(c) EFFECTIVE DATE.—The amendments made by 
this section shall apply to taxable years beginning after 
December 31, 2008. 
(d) APPLICATION
OF
EGTRRA SUNSET.—The 
amendment made by subsection (b)(1) shall be subject to 
title IX of the Economic Growth and Tax Relief Reconcili-
ation Act of 2001 in the same manner as the provision 
of such Act to which such amendment relates. 
(e) TREASURY STUDIES REGARDING EDUCATION IN-
CENTIVES.— 
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433 
AMDT. NO. 570 
(1) STUDY
REGARDING
COORDINATION
WITH 
NON-TAX
EDUCATIONAL
INCENTIVES.—The Sec-
retary of the Treasury, or the Secretary’s delegate, 
shall study how to coordinate the credit allowed 
under section 25A of the Internal Revenue Code of 
1986 with the Federal Pell Grant program under 
section 401 of the Higher Education Act of 1965. 
(2) STUDY REGARDING IMPOSITION OF COMMU-
NITY
SERVICE
REQUIREMENTS.—The Secretary of 
the Treasury, or the Secretary’s delegate, shall study 
the feasibility of requiring students to perform com-
munity service as a condition of taking their tuition 
and related expenses into account under section 25A 
of the Internal Revenue Code of 1986. 
(3) REPORT.—Not later than 1 year after the 
date of the enactment of this Act, the Secretary of 
the Treasury, or the Secretary’s delegate, shall re-
port to Congress on the results of the studies con-
ducted under this paragraph. 
SEC. 1005. COMPUTER TECHNOLOGY AND EQUIPMENT AL-
LOWED AS A QUALIFIED HIGHER EDUCATION 
EXPENSE FOR SECTION 529 ACCOUNTS IN 
2009 AND 2010. 
(a) IN GENERAL.—Section 529(e)(3)(A) is amended 
by striking ‘‘and’’ at the end of clause (i), by striking the 
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434 
AMDT. NO. 570 
period at the end of clause (ii), and by adding at the end 
the following: 
‘‘(iii) expenses paid or incurred in 
2009 or 2010 for the purchase of any com-
puter technology or equipment (as defined 
in section 170(e)(6)(F)(i)) or Internet ac-
cess and related services, if such tech-
nology, equipment, or services are to be 
used by the beneficiary and the bene-
ficiary’s family during any of the years the 
beneficiary is enrolled at an eligible edu-
cational institution. 
Clause (iii) shall not include expenses for com-
puter software designed for sports, games, or 
hobbies unless the software is predominantly 
educational in nature.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
this section shall apply to expenses paid or incurred after 
December 31, 2008. 
SEC. 1006. CREDIT FOR CERTAIN HOME PURCHASES. 
(a) ALLOWANCE OF CREDIT.—Subpart A of part IV 
of subchapter A of chapter 1 is amended by inserting after 
section 25D the following new section: 
‘‘SEC. 25E. CREDIT FOR CERTAIN HOME PURCHASES. 
‘‘(a) ALLOWANCE OF CREDIT.— 
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435 
AMDT. NO. 570 
‘‘(1) IN GENERAL.—In the case of an individual 
who is a purchaser of a principal residence during 
the taxable year, there shall be allowed as a credit 
against the tax imposed by this chapter an amount 
equal to 10 percent of the purchase price of the resi-
dence. 
‘‘(2) DOLLAR LIMITATION.—The amount of the 
credit allowed under paragraph (1) shall not exceed 
$15,000. 
‘‘(3) ALLOCATION OF CREDIT AMOUNT.—At the 
election of the taxpayer, the amount of the credit al-
lowed under paragraph (1) (after application of 
paragraph (2)) may be equally divided among the 2 
taxable years beginning with the taxable year in 
which the purchase of the principal residence is 
made. 
‘‘(b) LIMITATIONS.— 
‘‘(1) DATE OF PURCHASE.—The credit allowed 
under subsection (a) shall be allowed only with re-
spect to purchases made— 
‘‘(A) after the date of the enactment of the 
American Recovery and Reinvestment Tax Act 
of 2009, and 
‘‘(B) on or before the date that is 1 year 
after such date of enactment. 
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436 
AMDT. NO. 570 
‘‘(2) LIMITATION
BASED
ON
AMOUNT
OF 
TAX.—In the case of a taxable year to which section 
26(a)(2) does not apply, the credit allowed under 
subsection (a) for any taxable year shall not exceed 
the excess of— 
‘‘(A) the sum of the regular tax liability 
(as defined in section 26(b)) plus the tax im-
posed by section 55, over 
‘‘(B) the sum of the credits allowable 
under this subpart (other than this section) for 
the taxable year. 
‘‘(3) ONE-TIME ONLY.— 
‘‘(A) IN GENERAL.—If a credit is allowed 
under this section in the case of any individual 
(and such individual’s spouse, if married) with 
respect to the purchase of any principal resi-
dence, no credit shall be allowed under this sec-
tion in any taxable year with respect to the pur-
chase of any other principal residence by such 
individual or a spouse of such individual. 
‘‘(B) JOINT PURCHASE.—In the case of a 
purchase of a principal residence by 2 or more 
unmarried individuals or by 2 married individ-
uals filing separately, no credit shall be allowed 
under this section if a credit under this section 
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437 
AMDT. NO. 570 
has been allowed to any of such individuals in 
any taxable year with respect to the purchase of 
any other principal residence. 
‘‘(c) PRINCIPAL RESIDENCE.—For purposes of this 
section, the term ‘principal residence’ has the same mean-
ing as when used in section 121. 
‘‘(d) DENIAL OF DOUBLE BENEFIT.—No credit shall 
be allowed under this section for any purchase for which 
a credit is allowed under section 36 or section 1400C. 
‘‘(e) SPECIAL RULES.— 
‘‘(1) JOINT PURCHASE.— 
‘‘(A) MARRIED INDIVIDUALS FILING SEPA-
RATELY.—In the case of 2 married individuals 
filing separately, subsection (a) shall be applied 
to each such individual by substituting ‘$7,500’ 
for ‘$15,000’ in subsection (a)(1). 
‘‘(B) UNMARRIED INDIVIDUALS.—If 2 or 
more individuals who are not married purchase 
a principal residence, the amount of the credit 
allowed under subsection (a) shall be allocated 
among such individuals in such manner as the 
Secretary may prescribe, except that the total 
amount of the credits allowed to all such indi-
viduals shall not exceed $15,000. 
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438 
AMDT. NO. 570 
‘‘(2) PURCHASE.—In defining the purchase of a 
principal residence, rules similar to the rules of 
paragraphs (2) and (3) of section 1400C(e) (as in 
effect on the date of the enactment of this section) 
shall apply. 
‘‘(3) REPORTING REQUIREMENT.—Rules similar 
to the rules of section 1400C(f) (as so in effect) 
shall apply. 
‘‘(f) RECAPTURE OF CREDIT IN THE CASE OF CER-
TAIN DISPOSITIONS.— 
‘‘(1) IN GENERAL.—In the event that a tax-
payer— 
‘‘(A) disposes of the principal residence 
with respect to which a credit was allowed 
under subsection (a), or 
‘‘(B) fails to occupy such residence as the 
taxpayer’s principal residence, 
at any time within 24 months after the date on 
which the taxpayer purchased such residence, then 
the tax imposed by this chapter for the taxable year 
during which such disposition occurred or in which 
the taxpayer failed to occupy the residence as a prin-
cipal residence shall be increased by the amount of 
such credit. 
‘‘(2) EXCEPTIONS.— 
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439 
AMDT. NO. 570 
‘‘(A) DEATH
OF
TAXPAYER.—Paragraph 
(1) shall not apply to any taxable year ending 
after the date of the taxpayer’s death. 
‘‘(B) INVOLUNTARY
CONVERSION.—Para-
graph (1) shall not apply in the case of a resi-
dence which is compulsorily or involuntarily 
converted (within the meaning of section 
1033(a)) if the taxpayer acquires a new prin-
cipal residence within the 2-year period begin-
ning on the date of the disposition or cessation 
referred to in such paragraph. Paragraph (1) 
shall apply to such new principal residence dur-
ing the remainder of the 24-month period de-
scribed in such paragraph as if such new prin-
cipal residence were the converted residence. 
‘‘(C) TRANSFERS BETWEEN SPOUSES OR 
INCIDENT TO DIVORCE.—In the case of a trans-
fer of a residence to which section 1041(a) ap-
plies— 
‘‘(i) paragraph (1) shall not apply to 
such transfer, and 
‘‘(ii) in the case of taxable years end-
ing after such transfer, paragraph (1) shall 
apply to the transferee in the same manner 
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440 
AMDT. NO. 570 
as if such transferee were the transferor 
(and shall not apply to the transferor). 
‘‘(D) RELOCATION OF MEMBERS OF THE 
ARMED
FORCES.—Paragraph (1) shall not 
apply in the case of a member of the Armed 
Forces of the United States on active duty who 
moves pursuant to a military order and incident 
to a permanent change of station. 
‘‘(3) JOINT RETURNS.—In the case of a credit 
allowed under subsection (a) with respect to a joint 
return, half of such credit shall be treated as having 
been allowed to each individual filing such return for 
purposes of this subsection. 
‘‘(4) RETURN REQUIREMENT.—If the tax im-
posed by this chapter for the taxable year is in-
creased under this subsection, the taxpayer shall, 
notwithstanding section 6012, be required to file a 
return with respect to the taxes imposed under this 
subtitle. 
‘‘(g) BASIS ADJUSTMENT.—For purposes of this sub-
title, if a credit is allowed under this section with respect 
to the purchase of any residence, the basis of such resi-
dence shall be reduced by the amount of the credit so al-
lowed. 
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441 
AMDT. NO. 570 
‘‘(h) ELECTION
TO TREAT PURCHASE
IN PRIOR 
YEAR.—In the case of a purchase of a principal residence 
during the period described in subsection (b)(1), a tax-
payer may elect to treat such purchase as made on Decem-
ber 31, 2008, for purposes of this section.’’. 
(b) CLERICAL AMENDMENT.—The table of sections 
for subpart A of part IV of subchapter A of chapter 1 
is amended by inserting after the item relating to section 
25D the following new item: 
‘‘Sec. 25E. Credit for certain home purchases.’’. 
(c) SUNSET OF CURRENT FIRST-TIME HOMEBUYER 
CREDIT.— 
(1) IN GENERAL.—Subsection (h) of section 36 
is amended by striking ‘‘July 1, 2009’’ and inserting 
‘‘the date of the enactment of the American Recov-
ery and Reinvestment Tax Act of 2009’’. 
(2) ELECTION TO TREAT PURCHASE IN PRIOR 
YEAR.—Subsection (g) of section 36 is amended by 
striking ‘‘July 1, 2009’’ and inserting ‘‘the date of 
the enactment of the American Recovery and Rein-
vestment Tax Act of 2009’’. 
(d) EFFECTIVE DATE.—The amendments made by 
this section shall apply to purchases after the date of the 
enactment of this Act. 
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