projects awarded grants under this sub-
section on the same basis as fathers, ex-
pectant fathers, and married fathers.
‘‘(B) 
PREFERENCES.—In 
determining
which entities to which to award grants under
this subsection, the Secretary shall give pref-
erence to an entity—
‘‘(i) to the extent that the application
submitted by the entity describes actions
that the entity will take that are designed
to encourage or facilitate the payment of
child support, including but not limited
to—
‘‘(I) obtaining agreements with
the State in which the project will be
carried out under which the State will
exercise its authority under the last
sentence of section 457(a)(2)(B)(iv) in
every case in which such authority
may be exercised;
‘‘(II) obtaining a written commit-
ment by the agency responsible for
administering the State plan approved
under part D for the State in which
the project is to be carried out that
the State will cancel child support ar-
rearages owed to the State in propor-
tion to the length of time that the fa-
ther maintains a regular child support
payment schedule or lives with his
children; and
‘‘(III) obtaining a written com-
mitment by the entity that the entity
will help participating fathers who co-
operate with the agency in improving
their credit rating;
‘‘(ii) to the extent that the application
includes written agreements of cooperation
with other private and governmental agen-
cies, including the State or local program
funded under this part, the local Work-
force Investment Board, and the State or
local program funded under part D, which
should include a description of the services
each such agency will provide to fathers
participating in the project described in the
application;
‘‘(iii) to the extent that the applica-
tion describes a project that will enroll a
high percentage of project participants
within 6 months before or after the birth
of the child; and
‘‘(iv) to the extent that the application
sets forth clear and practical methods by
which fathers will be recruited to partici-
pate in the project.
‘‘(C) MINIMUM PERCENTAGE OF GRANTS
FOR
NONGOVERNMENTAL
(INCLUDING
FAITH-
BASED)
ORGANIZATIONS.—Not less than 75
percent of the aggregate amounts paid as
grants under this subsection in each fiscal year
(other than amounts paid pursuant to the pref-
erences required by subparagraph (B)) shall be
awarded to nongovernmental (including faith-
based) organizations.
‘‘(D) DIVERSITY OF PROJECTS.—In deter-
mining which entities to which to award grants
under this subsection, the Secretary shall at-
tempt to achieve a balance among entities of
differing sizes, entities in differing geographic
areas, entities in urban versus rural areas, and
entities employing differing methods of achiev-
ing the purposes of this section.
‘‘(E) PAYMENT OF GRANT IN 4 EQUAL AN-
NUAL INSTALLMENTS.—During the fiscal year
in which a grant is awarded under this sub-
section and each of the succeeding 3 fiscal
years, the Secretary shall provide to the entity
awarded the grant an amount equal to 1⁄4 of
the amount of the grant.
‘‘(4) USE OF FUNDS.—
‘‘(A) IN GENERAL.—Each entity to which
a grant is made under this subsection shall use
grant funds provided under this subsection in
accordance with the application requesting the
grant, the requirements of this subsection, and
the regulations prescribed under this sub-
section, and may use the grant funds to support
community-wide initiatives to address the pur-
poses of this section.
‘‘(B) NONDISPLACEMENT.—
‘‘(i) IN
GENERAL.—An adult in a
work activity described in section 407(d)
which is funded, in whole or in part, by
funds provided under this section shall not
be employed or assigned—
‘‘(I) when any other individual is
on layoff from the same or any sub-
stantially equivalent job; or
‘‘(II) if the employer has termi-
nated the employment of any regular
employee or otherwise caused an in-
voluntary reduction of its workforce in
order to fill the vacancy so created
with such an adult.
‘‘(ii) GRIEVANCE PROCEDURE.—
‘‘(I) 
STATE
PROCEDURE.—A
State to which a grant is made under
this section shall establish and main-
tain a grievance procedure for resolv-
ing complaints of alleged violations of
clause (i) by State or local govern-
mental entities.
‘‘(II) FEDERAL
PROCEDURE.—
The Secretary shall establish and
maintain a grievance procedure for re-
solving complaints of alleged viola-
tions of clause (i) by private entities.
‘‘(iii) NO
PREEMPTION.—This sub-
paragraph shall not preempt or supersede
any provision of State or local law that
provides greater protection for employees
from displacement.
‘‘(C) RULE OF CONSTRUCTION.—This sec-
tion shall not be construed to require the par-
ticipation of a father in a project funded under
this section to be discontinued by the project on
the basis of changed economic circumstances of
the father.
‘‘(D) RULE OF CONSTRUCTION ON MAR-
RIAGE.—This section shall not be construed to
authorize the Secretary to define marriage for
purposes of this section.
‘‘(E) PENALTY
FOR
MISUSE
OF
GRANT
FUNDS.—If the Secretary determines that an
entity to which a grant is made under this sub-
section has used any amount of the grant in
violation of subparagraph (A), the Secretary
shall require the entity to remit to the Sec-
retary an amount equal to the amount so used,
plus all remaining grant funds, and the entity
shall thereafter be ineligible for any grant
under this subsection.
‘‘(F) REMITTANCE
OF
UNUSED
GRANT
FUNDS.—Each entity to which a grant is
awarded under this subsection shall remit to
the Secretary all funds paid under the grant
that remain at the end of the 5th fiscal year
ending after the initial grant award.
‘‘(5) AUTHORITY OF STATE AGENCIES TO EX-
CHANGE INFORMATION.—Each agency administering
a State program funded under this part or a State
plan approved under part D may share the name ad-
dress, and telephone number of fathers for purposes
of assisting in determining the eligibility of fathers
to participate in projects receiving grants under this
title, and in contacting fathers potentially eligible to
participate in the projects, subject to all applicable
privacy laws.
‘‘(6) EVALUATION.—The Secretary, in consulta-
tion with the Secretary of Labor, shall, directly or
by grant, contract, or interagency agreement, con-
duct an evaluation of projects funded under this sec-
tion (other than under subsection (c)(1)). The eval-
uation shall assess, among other outcomes selected
by the Secretary, effects of the projects on marriage,
parenting, employment, earnings, and payment of
child support. In selecting projects for the evalua-
tion, the Secretary should include projects that, in
the Secretary’s judgment, are most likely to impact
the matters described in the purposes of this section.
In conducting the evaluation, random assignment
should be used wherever possible.
‘‘(7) REGULATIONS.—The Secretary shall pre-
scribe such regulations as may be necessary to carry
out this subsection.
‘‘(8) LIMITATION ON APPLICABILITY OF OTHER
PROVISIONS OF THIS PART.—Sections 404 through
410 shall not apply to this section or to amounts
paid under this section, and shall not be applied to
an entity solely by reason of receipt of funds pursu-
ant to this section.
‘‘(9) FUNDING.—
‘‘(A) IN GENERAL.—
‘‘(i) INTERAGENCY
PANELS.—Of the
amounts made available pursuant to sec-
tion 403(a)(1)(E) for fiscal years 2000
and 2001, a total of $150,000 shall be
made available for the interagency panels
established by paragraph (2) of this sub-
section.
‘‘(ii) GRANTS.—Of the amounts made
available pursuant to section 403(a)(1)(E),
there shall be made available for grants
under this subsection—
‘‘(I) $17,500,000 for fiscal year
2001;
‘‘(II) $35,000,000 for each of fis-
cal years 2002 through 2004; and
‘‘(III) $17,500,000 for fiscal year
2005.
‘‘(iii) EVALUATION.—Of the amounts
made 
available 
pursuant 
to 
section
403(a)(1)(E) for fiscal years 2000 through
2006, a total of $6,000,000 shall be made
available for the evaluation required by
paragraph (6) of this subsection.
‘‘(B) AVAILABILITY.—
‘‘(i) GRANT
FUNDS.—The amounts
made available pursuant to subparagraph
(A)(ii) shall remain available until the end
of fiscal year 2005.
‘‘(ii) 
EVALUATION
FUNDS.—The
amounts made available pursuant to sub-
paragraph (A)(iii) shall remain available
until the end of fiscal year 2006.’’.
(b) FUNDING.—Section 403(a)(1)(E) of such Act (42
U.S.C. 603(a)(1)(E)) is amended by inserting ‘‘, and for
fiscal years 2000 through 2006, such sums as are nec-
essary to carry out section 403A’’ before the period.
(c) AUTHORITY
TO STATES TO PASS THROUGH
CHILD SUPPORT ARREARAGES COLLECTED THROUGH
TAX REFUND INTERCEPT
TO FAMILIES WHO HAVE
CEASED TO RECEIVE CASH ASSISTANCE; FEDERAL RE-
IMBURSEMENT
OF STATE SHARE
OF SUCH PASSED
THROUGH
ARREARAGES.—Section 457(a)(2)(B)(iv) of
such Act (42 U.S.C. 657(a)(2)(B)(iv)) is amended—
(1) by inserting ‘‘(except the last sentence of
this clause)’’ after ‘‘this section’’; and
(2) by adding at the end the following: ‘‘Not-
withstanding the preceding sentences of this clause,
if the amount is collected on behalf of a family that
includes a child of a participant in a project funded
under section 403A and that has ceased to receive
cash payments under a State program funded under
section 403, and the amount so collected exceeds the
amount that would otherwise be required to be paid
to the family for the month in which collected, then
the State may distribute the amount to the family,
and the aggregate of the amounts otherwise required
by this section to be paid by the State to the Fed-
eral Government shall be reduced by an amount
equal to the State share of any amount so distrib-
uted.’’.
(d) APPLICABILITY OF CHARITABLE CHOICE PROVI-
SIONS OF WELFARE REFORM.—Section 104 of the Per-
sonal Responsibility and Work Opportunity Reconciliation
Act of 1996 (42 U.S.C. 604a) is amended by adding at
the end the following:
‘‘(l) Notwithstanding the preceding provisions of this
section, this section shall apply to any entity to which
funds have been provided under section 403A of the Social
Security Act in the same manner in which this section ap-
plies to States, and, for purposes of this section, any
project for which such funds are so provided shall be con-
sidered a program described in subsection (a)(2).’’.
(e) TANF MAINTENANCE OF EFFORT DETERMINA-
TIONS TO BE MADE WITHOUT REGARD TO EXPENDI-
TURES
FOR
FATHERHOOD
PROGRAMS.—Section
409(a)(7)(B)(i) of such Act (42 U.S.C. 609(a)(7)(B)(i))
is amended by adding at the end the following:
‘‘(V) EXCLUSION
OF
EXPENDI-
TURES
FOR
FATHERHOOD
PRO-
GRAMS.—Such term does not include
expenditures for any project for which
funds are provided under section
403A.’’.
TITLE 
II—FATHERHOOD 
PRO-
JECTS OF NATIONAL SIGNIFI-
CANCE
SEC. 201. FATHERHOOD PROJECTS OF NATIONAL SIGNIFI-
CANCE.
Section 403A of the Social Security Act, as added
by title I of this Act, is amended by adding at the end
the following:
‘‘(c) FATHERHOOD PROJECTS
OF NATIONAL SIG-
NIFICANCE.—
‘‘(1) NATIONAL
CLEARINGHOUSE.—The Sec-
retary shall award a $5,000,000 grant to a nation-
ally recognized, nonprofit fatherhood promotion or-
ganization with at least 4 years of experience in de-
signing and disseminating a national public edu-
cation campaign, including the production and suc-
cessful placement of television, radio, and print pub-
lic service announcements which promote the impor-
tance of responsible fatherhood, and with at least 4
years experience providing consultation and training
to community-based organizations interested in im-
plementing fatherhood outreach, support, or skill de-
velopment programs with an emphasis on promoting
married fatherhood as the ideal, to—
‘‘(A) develop, promote, and distribute to
interested States, local governments, public
agencies, and private nonprofit organizations,
including charitable and religious organizations,
a media campaign that encourages the appro-
priate involvement of both parents in the life of
any child of the parents, and encourages such
organizations to develope or sponsor programs
that specifically address the issue of responsible
fatherhood and the advantages conferred on
children by marriage;
‘‘(B) develop a national clearinghouse to
assist States, communities, and private entities
in efforts to promote and support marriage and
responsible fatherhood by collecting, evaluating,
and making available (through the Internet and
by other means) to all interested parties, infor-
mation regarding media campaigns and father-
hood programs;
‘‘(C) develop and distribute materials that
are for use by entities described in subpara-
graph (A) or (B) and that help young adults
manage their money, develop the knowledge and
skills needed to promote successful marriages,
plan for future expenditures and investments,
and plan for retirement;
‘‘(D) develop and distribute materials that
are for use by entities described in subpara-
graphs (A) and (B) and that list all the sources
of public support for education and training
that are available to young adults, including
government spending programs as well as bene-
fits under Federal and State tax laws.
‘‘(2) MULTICITY FATHERHOOD PROJECTS.—
‘‘(A) IN
GENERAL.—The Secretary shall
award a $5,000,000 grant to each of 2 nation-
ally recognized nonprofit fatherhood promotion
organizations which meet the requirements of
subparagraph (B), at least 1 of which organiza-
tions meets the requirement of subparagraph
(C).
‘‘(B) REQUIREMENTS.—The requirements
of this subparagraph are the following:
‘‘(i) The organization must have sev-
eral years of experience in designing and
conducting programs that meet the pur-
poses described in paragraph (1).
‘‘(ii) The organization must have ex-
perience in simultaneously conducting such
programs in more than 1 major metropoli-
tan area and in coordinating such pro-
grams with local government agencies and
private, nonprofit agencies, including State
or local agencies responsible for conducting
the program under part D and Workfore
Investment Boards.
‘‘(iii) The organization must submit to
the Secretary an application that meets all
the conditions applicable to the organiza-
tion under this section and that provides
for projects to be conducted in 3 major
metropolitan areas.
‘‘(C) USE OF MARRIED COUPLES TO DE-
LIVER SERVICES IN THE INNER CITY.—The re-
quirement of this subparagraph is that the or-
ganization has extensive experience in using
married couples to deliver program services in
the inner city.
‘‘(3) PAYMENT OF GRANTS IN 4 EQUAL ANNUAL
INSTALLMENTS.—During each of fiscal years 2002
through 2005, the Secretary shall provide to each
entity awarded a grant under this subsection an
amount equal to 1⁄4 of the amount of the grant.
‘‘(4) FUNDING.—
‘‘(A) IN GENERAL.—Of the amounts made
available pursuant to section 403(a)(1)(E),
$3,750,000 shall be made available for grants
under this subsection for each of fiscal years
2002 through 2005.
‘‘(B) AVAILABILITY.—The amounts made
available pursuant to subparagraph (A) shall
remain available until the end of fiscal year
2005.’’.
TITLE III—WELFARE-TO-WORK
PROGRAM ELIGIBILITY
SEC. 301. FLEXIBILITY IN ELIGIBILITY FOR PARTICIPATION
IN WELFARE-TO-WORK PROGRAM.
(a) HARD-TO-EMPLOY LONG-TERM RECIPIENTS.—
Section 403(a)(5)(C)(ii) of the Social Security Act (42
U.S.C. 603(a)(5)(C)(ii)) is amended—
(1) by striking ‘‘REQUIRED BENEFICIARIES.—’’
and inserting ‘‘HARD-TO-EMPLOY RECIPIENTS.—’’;
(2) in the matter preceding subclause (I)—
(A) by striking ‘‘shall expend at least 70
percent of all’’ and inserting ‘‘may expend’’;
and
(B) by striking ‘‘, or for the benefit of non-
custodial parents,’’;
(3) in the matter preceding item (aa) of sub-
clause (I)—
(A) by striking ‘‘At least 2’’ and inserting
‘‘Any’’;
(B) by striking ‘‘apply’’ and inserting ‘‘ap-
plies’’; and
(C) by striking ‘‘or the noncustodial par-
ent’’;
(4) in item (aa) of subclause (I), by striking ‘‘,
and has low skills in reading or mathematics’’;
(5) by adding at the end of subclause (I) the
following:
‘‘(dd) The individual has
English reading, writing, or com-
puting skills at or below the 8th
grade level.
‘‘(ee) 
The 
individual 
is
homeless.
‘‘(ff) The individual has a
disability.
‘‘(gg) The individual has
been a victim of domestic vio-
lence.’’; and
(6) in the matter preceding item (aa) of sub-
clause (II), by striking ‘‘or the minor children of the
non-custodial parent’’.
(b) NONCUSTODIAL PARENTS.—
(1) IN GENERAL.—Section 403(a)(5)(C) of such
Act (42 U.S.C. 603(a)(5)(C)) is amended—
(A) by redesignating clauses (iii) through
(viii) as clauses (iv) through (ix), respectively;
and
(B) by inserting after clause (ii) the fol-
lowing:
‘‘(iii) NONCUSTODIAL
PARENTS.—An
entity that operates a project with funds
provided under this paragraph may use the
funds to provide services in a form de-
scribed in clause (i) to noncustodial par-
ents with respect to whom the require-
ments of the following subclauses are met:
‘‘(I) The noncustodial parent is
unemployed, underemployed, or hav-
ing difficulty in paying child support
obligations.
‘‘(II) At least 1 of the following
applies to a minor child of the non-
custodial parent (with preference in
the determination of the noncustodial
parents to be provided services under
this paragraph to be provided by the
entity to those noncustodial parents
with minor children who meet, or who
have custodial parents who meet, the
requirements of item (aa)):
‘‘(aa) The minor child or the
custodial parent of the minor
child meets the requirements of
clause (ii)(II).
‘‘(bb) The minor child is eli-
gible for, or is receiving, benefits
under the program funded under
this part.
‘‘(cc) The minor child re-
ceived benefits under the pro-
gram funded under this part in
the 12-month period preceding
the date of the determination but
no longer receives such benefits.
‘‘(dd) The minor child is eli-
gible for, or is receiving, assist-
ance under the Food Stamp Act
of 1977, benefits under the sup-
plemental security income pro-
gram under title XVI of this Act,
medical assistance under title
XIX of this Act, or child health
assistance under title XXI of this
Act.
‘‘(III) In the case of a noncusto-
dial parent who becomes enrolled in
the project on or after the date of the
enactment of this clause, the non-
custodial parent is in compliance with
the terms of an oral or written per-
sonal responsibility contract entered
into among the noncustodial parent,
the entity, and (unless the entity dem-
onstrates to the Secretary that the en-
tity is not capable of coordinating
with such agency) the agency respon-
sible for administering the State plan
under part D, which was developed
taking into account the employment
and child support status of the non-
custodial parent, which was entered
into not later than 30 (or, at the op-
tion of the entity, not later than 90)
days after the noncustodial parent
was enrolled in the project, and which,
at a minimum, includes the following:
‘‘(aa) A commitment by the
noncustodial parent to cooperate,
at the earliest opportunity, in the
establishment of the paternity of
the minor child, through vol-
untary acknowledgement or other
procedures, and in the establish-
ment of a child support order.
‘‘(bb) A commitment by the
noncustodial parent to cooperate
in the payment of child support
for the minor child, which may
include a modification of an ex-
isting support order to take into
account the ability of the non-
custodial parent to pay such sup-
port and the participation of such
parent in the project.
‘‘(cc) A commitment by the
noncustodial parent to participate
in employment or related activi-
ties that will enable the noncusto-
dial parent to make regular child
support payments, and if the
noncustodial parent has not at-
tained 20 years of age, such re-
lated activities may include com-
pletion of high school, a general
equivalency degree, or other edu-
cation directly related to employ-
ment.
‘‘(dd) A description of the
services to be provided under this
paragraph, and a commitment by
the noncustodial parent to par-
ticipate in such services, that are
designed to assist the noncusto-
dial parent obtain and retain em-
ployment, increase earnings, and
enhance the financial and emo-
tional contributions to the well-
being of the minor child.
In order to protect custodial parents
and children who may be at risk of
domestic violence, the preceding provi-
sions of this subclause shall not be
construed to affect any other provi-
sion of law requiring a custodial par-
ent to cooperate in establishing the
paternity of a child or establishing or
enforcing a support order with respect
to a child, or entitling a custodial par-
ent to refuse, for good cause, to pro-
vide such cooperation as a condition
of assistance or benefit under any
program, shall not be construed to re-
quire such cooperation by the custo-
dial parent as a condition of participa-
tion of either parent in the program
authorized under this paragraph, and
shall not be construed to require a
custodial parent to cooperate with or
participate in any activity under this
clause. The entity operating a project
under this clause with funds provided
under this paragraph shall consult
with domestic violence prevention and
intervention organizations in the de-
velopment of the project.’’.
(2) 
CONFORMING
AMENDMENT.—Section
412(a)(3)(C)(ii) 
of 
such 
Act 
(42 
U.S.C.
(A) in the heading by inserting ‘‘HARD TO
EMPLOY’’ before ‘‘INDIVIDUALS’’; and
(B) in the last sentence by striking ‘‘clause
(ii)’’ and inserting ‘‘clauses (ii) and (iii) and, as
appropriate, clause (v)’’.
(d) CUSTODIAL PARENTS WITH INCOME BELOW
POVERTY LINE WHO ARE NOT ON WELFARE.—
(1) IN GENERAL.—Section 403(a)(5)(C) of such
Act (42 U.S.C. 603(a)(5)(C)), as amended by sec-
tion 301(b)(1) of this Act, is amended—
(A) by redesignating clauses (vi) through
(ix) as clauses (vii) through (x), respectively;
and
(B) by inserting after clause (v) the fol-
lowing:
‘‘(vi) CUSTODIAL PARENTS WITH IN-
COME
BELOW
POVERTY
LINE
WHO
ARE
NOT ON WELFARE.—An entity that oper-
ates a project with funds provided under
this paragraph may use the funds to pro-
vide assistance in a form described in
clause (i) to custodial parents—
‘‘(I) whose income is less than
100 percent of the poverty line (as de-
fined in section 673(2) of the Omni-
bus Budget Reconciliation Act of
1981, including any revision required
by such section, applicable to a family
of the size involved); and
‘‘(II) who are not otherwise re-
cipients of assistance under a State
program funded under this part.’’.
(2) CONFORMING AMENDMENTS.—
(A) Section 403(a)(5)(C)(iv) of such Act
(42 U.S.C. 603(a)(5)(C)(iv)), as so redesig-
nated by subsection (b)(1)(A) of this section,
and as amended by subsection (c)(2) of this
section, is amended in the last sentence by
striking ‘‘clause (v)’’ and inserting ‘‘clauses (v)
and (vi)’’.
(B) Section 412(a)(3)(C)(ii) of such Act
(42 U.S.C. 612(a)(3)(C)(ii)), as amended by
subsection (b)(2) of this section, is amended by
striking ‘‘(viii)’’ and inserting ‘‘(ix)’’.
SEC. 302. LIMITED VOCATIONAL EDUCATIONAL TRAINING
INCLUDED AS ALLOWABLE ACTIVITY.
Section 403(a)(5)(C)(i) of the Social Security Act (42
U.S.C. 603(a)(5)(C)(i)) is amended by inserting after sub-
clause (VI) the following:
‘‘(VII) Not more than 6 months
of vocational educational training.’’.
SEC. 303. CERTAIN GRANTEES AUTHORIZED TO PROVIDE
EMPLOYMENT SERVICES DIRECTLY.
Section 403(a)(5)(C)(i)(IV) of the Social Security
Act (42 U.S.C. 603(a)95)(C)(i)(IV)) is amended by insert-
ing ‘‘, or if the entity is not a private industry council
or workforce investment board, the direct provision of such
services’’ before the period.
SEC. 304. SIMPLIFICATION AND COORDINATION OF RE-
PORTING REQUIREMENTS.
(a) ELIMINATION OF CURRENT REQUIREMENTS.—
Section 411(a)(1)(A) of the Social Security Act (42 U.S.C.
611(a)(1)(A)) is amended—
(1) in the matter preceding clause (i), by insert-
ing ‘‘(except for information relating to activities
carried out under section 403(a)(5))’’ after ‘‘part’’;
and
(2) by striking clause (xviii).
(b) ESTABLISHMENT
OF
REPORTING
REQUIRE-
MENT.—Section 403(a)(5)(C) of the Social Security Act
(42 U.S.C. 603(a)(5)(C)), as amended by subsections
(b)(1) and (d)(1) of section 301 of this Act, is amended
by adding at the end the following:
‘‘(xi) REPORTING
REQUIREMENTS.—
The Secretary of Labor, in consultation
with the Secretary of Health and Human
Services, shall establish requirements for
the collection and maintenance of financial
and participant information and the re-
porting of such information by entities car-
rying out activities under this paragraph.’’.
TITLE 
IV—ALTERNATIVE 
PEN-
ALTY PROCEDURE RELATING
TO 
STATE 
DISBURSEMENT
UNITS
SEC. 401. ALTERNATIVE PENALTY PROCEDURE RELATING
TO STATE DISBURSEMENT UNITS.
(a) IN GENERAL.—Section 455(a) of the Social Secu-
rity Act (42 U.S.C. 655(a)) is amended by adding at the
end the following:
‘‘(5)(A)(i) If—
‘‘(I) the Secretary determines that a State plan
under section 454 would (in the absence of this
paragraph) be disapproved for the failure of the
State to comply with subparagraphs (A) and (B)(i)
of section 454(27), and that the State has made and
is continuing to make a good faith effort to so com-
ply; and
‘‘(II) the State has submitted to the Secretary,
not later than April 1, 2000, a corrective compliance
plan that describes how, by when, and at what cost
the State will achieve such compliance, which has
been approved by the Secretary,
then the Secretary shall not disapprove the State plan
under section 454, and the Secretary shall reduce the
amount otherwise payable to the State under paragraph
(1)(A) of this subsection for the fiscal year by the penalty
amount.
‘‘(ii) All failures of a State during a fiscal year to
comply with any of the requirements of section 454B shall
be considered a single failure of the State to comply with
subparagraphs (A) and (B)(i) of section 454(27) during
the fiscal year for purposes of this paragraph.
‘‘(B) In this paragraph:
‘‘(i) The term ‘penalty amount’ means, with re-
spect to a failure of a State to comply with subpara-
graphs (A) and (B)(i) of section 454(27)—
‘‘(I) 4 percent of the penalty base, in the
case of the 1st fiscal year in which such a fail-
ure by the State occurs (regardless of whether
a penalty is imposed in that fiscal year under
this paragraph with respect to the failure), ex-