tional hours, or require child care services for 
infants or toddlers.’’. 
SEC. 205. ACTIVITIES TO IMPROVE THE QUALITY OF CHILD 
CARE. 
Section 658G of the Child Care and Development 
Block Grant Act of 1990 (42 U.S.C. 9858e) is amended 
to read as follows: 
‘‘SEC. 658G. ACTIVITIES TO IMPROVE THE QUALITY OF 
CHILD CARE SERVICES. 
‘‘A State that receives funds to carry out this sub-
chapter for a fiscal year, shall use not less than 6 percent 
of the amount of such funds for activities provided 
through resource and referral services or other means, 
that are designed to improve the quality of child care serv-
ices in the State available to low-income parents from eli-
gible child care providers. Such activities include—
‘‘(1) programs that provide training, education, 
and other professional development activities to en-
hance the skills of the child care workforce, includ-
ing training opportunities for caregivers in informal 
care settings; 
‘‘(2) activities within child care settings to en-
hance early learning for young children, to promote 
early literacy, and to foster school readiness;
‘‘(3) initiatives to increase the retention and 
compensation of child care providers, including 
tiered reimbursement rates for providers that meet 
quality standards as defined by the State; or 
‘‘(4) other activities deemed by the State to im-
prove the quality of child care services provided in 
such State.’’. 
SEC. 206. REPORT BY SECRETARY. 
Section 658L of the Child Care and Development 
Block Grant Act of 1990 (42 U.S.C. 9858j) is amended 
to read as follows: 
‘‘SEC. 658L. REPORT BY SECRETARY. 
‘‘(a) REPORT REQUIRED.—Not later than October 1, 
2005, and biennially thereafter, the Secretary shall pre-
pare and submit to the Committee on Education and the 
Workforce of the House of Representatives and the Com-
mittee on Health, Education, Labor and Pensions of the 
Senate a report that contains the following: 
‘‘(1) A summary and analysis of the data and 
information provided to the Secretary in the State 
reports submitted under section 658K. 
‘‘(2) Aggregated statistics on the supply of, de-
mand for, and quality of child care, early education, 
and non-school-hours programs.
‘‘(3) An assessment, and where appropriate, 
recommendations for the Congress concerning ef-
forts that should be undertaken to improve the ac-
cess of the public to quality and affordable child care 
in the United States. 
‘‘(b) COLLECTION OF INFORMATION.—The Secretary 
may utilize the national child care data system available 
through resource and referral organizations at the local, 
State, and national level to collect the information re-
quired by subsection (a)(2). 
SEC. 207. DEFINITIONS. 
Section 658P(4)(B) of the Child Care and Develop-
ment Block Grant Act of 1990 (42 U.S.C. 9858N(4)(B)) 
is amended by striking ‘‘85 percent of the State median 
income’’ and inserting ‘‘income levels as established by the 
State, prioritized by need,’’. 
SEC. 208. ENTITLEMENT FUNDING. 
Section 418(a)(3) (42 U.S.C. 618(a)(3)) is amend-
ed—
(1) by striking ‘‘and’’ at the end of subpara-
graph (E); 
(2) by striking the period at the end of sub-
paragraph (F) and inserting ‘‘; and’’; and 
(3) by adding at the end the following:
‘‘(G) $2,917,000,000 for each of fiscal 
years 2004 through 2008.’’. 
TITLE III—CHILD SUPPORT 
SEC. 301. FEDERAL MATCHING FUNDS FOR LIMITED PASS 
THROUGH OF CHILD SUPPORT PAYMENTS TO 
FAMILIES RECEIVING TANF. 
(a) IN
GENERAL.—Section 457(a) (42 U.S.C. 
657(a)) is amended—
(1) in paragraph (1)(A), by inserting ‘‘subject 
to paragraph (7)’’ before the semicolon; and 
(2) by adding at the end the following: 
‘‘(7) FEDERAL MATCHING FUNDS FOR LIMITED 
PASS THROUGH OF CHILD SUPPORT PAYMENTS TO 
FAMILIES RECEIVING TANF.—Notwithstanding para-
graph (1), a State shall not be required to pay to 
the Federal Government the Federal share of an 
amount collected during a month on behalf of a fam-
ily that is a recipient of assistance under the State 
program funded under part A, to the extent that—
‘‘(A) the State distributes the amount to 
the family; 
‘‘(B) the total of the amounts so distrib-
uted to the family during the month—
‘‘(i) exceeds the amount (if any) that, 
as of December 31, 2001, was required
under State law to be distributed to a fam-
ily under paragraph (1)(B); and 
‘‘(ii) does not exceed the greater of—
‘‘(I) $100; or 
‘‘(II) $50 plus the amount de-
scribed in clause (i); and 
‘‘(C) the amount is disregarded in deter-
mining the amount and type of assistance pro-
vided to the family under the State program 
funded under part A.’’. 
(b) EFFECTIVE DATE.—The amendments made by 
subsection (a) shall apply to amounts distributed on or 
after October 1, 2005. 
SEC. 302. STATE OPTION TO PASS THROUGH ALL CHILD 
SUPPORT PAYMENTS TO FAMILIES THAT 
FORMERLY RECEIVED TANF. 
(a) IN
GENERAL.—Section 457(a) (42 U.S.C. 
657(a)), as amended by section 301(a) of this Act, is 
amended—
(1) in paragraph (2)(B), in the matter pre-
ceding clause (i), by inserting ‘‘, except as provided 
in paragraph (8),’’ after ‘‘shall’’; and 
(2) by adding at the end the following: 
‘‘(8) STATE
OPTION
TO
PASS
THROUGH
ALL 
CHILD SUPPORT PAYMENTS TO FAMILIES THAT FOR-