I
105TH CONGRESS
1ST SESSION
H. R. 2849
To provide for the establishment of demonstration projects designed to deter-
mine the social, civic, psychological, and economic effects of providing
to individuals and families with limited means an opportunity to accumu-
late assets, and to determine the extent to which an asset-based policy
may be used to enable individuals and families with limited means to
achieve economic self-sufficiency.
IN THE HOUSE OF REPRESENTATIVES
NOVEMBER 6, 1997
Mr. HALL of Ohio (for himself and Mr. KASICH) introduced the following bill;
which was referred to the Committee on Ways and Means
A BILL
To provide for the establishment of demonstration projects
designed to determine the social, civic, psychological, and
economic effects of providing to individuals and families
with limited means an opportunity to accumulate assets,
and to determine the extent to which an asset-based
policy may be used to enable individuals and families
with limited means to achieve economic self-sufficiency.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Assets for Independence Act’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Findings.
Sec. 3. Purposes.
Sec. 4. Definitions.
Sec. 5. Applications.
Sec. 6. Demonstration authority; annual grants.
Sec. 7. Reserve fund.
Sec. 8. Eligibility for participation.
Sec. 9. Selection of individuals to participate.
Sec. 10. Deposits by qualified entities.
Sec. 11. Local control over demonstration projects.
Sec. 12. Annual progress reports.
Sec. 13. Sanctions.
Sec. 14. Evaluations.
Sec. 15. Authorizations of appropriations.
Sec. 16. Funds in individual development accounts of demonstration project
participants disregarded for purposes of all means-tested Fed-
eral programs.
SEC. 2. FINDINGS.
Congress makes the following findings:
(1) Economic well-being does not come solely
from income, spending, and consumption, but also
requires savings, investment, and accumulation of
assets because assets can improve economic inde-
pendence and stability, connect individuals with a
viable and hopeful future, stimulate development of
human and other capital, and enhance the welfare of
offspring.
(2) Fully 1⁄2 of all Americans have either no,
negligible, or negative assets available for invest-
ment, just as the price of entry to the economic
mainstream, the cost of a house, an adequate edu-
cation, and starting a business, is increasing. Fur-
ther, the household savings rate of the United States
lags far behind other industrial nations presenting a
barrier to economic growth.
(3) In the current tight fiscal environment, the
United States should invest existing resources in
high-yield initiatives. There is reason to believe that
the financial returns, including increased income, tax
revenue, and decreased welfare cash assistance, re-
sulting from individual development accounts will far
exceed the cost of investment in those accounts.
(4) Traditional public assistance programs con-
centrating on income and consumption have rarely
been successful in promoting and supporting the
transition to increased economic self-sufficiency. In-
come-based domestic policy should be complemented
with asset-based policy because, while income-based
policies ensure that consumption needs (including
food, child care, rent, clothing, and health care) are
met, asset-based policies provide the means to
achieve greater independence and economic well-
being.
SEC. 3. PURPOSES.
The purposes of this Act are to provide for the estab-
lishment of demonstration projects designed to deter-
mine—
(1) the social, civic, psychological, and economic
effects of providing to individuals and families with
limited means an incentive to accumulate assets by
saving a portion of their earned income;
(2) the extent to which an asset-based policy
that promotes saving for education, homeownership,
and microenterprise development may be used to en-
able individuals and families with limited means to
increase their economic self-sufficiency; and
(3) the extent to which an asset-based policy
stabilizes and improves families and the community
in which they live.
SEC. 4. DEFINITIONS.
In this Act:
(1) APPLICABLE PERIOD.—The term ‘‘applica-
ble period’’ means, with respect to amounts to be
paid from a grant made for a project year, the cal-
endar year immediately preceding the calendar year
in which the grant is made.
(2) ELIGIBLE INDIVIDUAL.—The term ‘‘eligible
individual’’ means an individual who is selected to
participate by a qualified entity under section 9 of
this Act.
(3) 
HOUSEHOLD.—The 
term 
‘‘household’’
means all individuals who share use of a dwelling
unit as primary quarters for living and eating sepa-
rate from other individuals.
(4) INDIVIDUAL DEVELOPMENT ACCOUNT.—
(A) IN GENERAL.—The term ‘‘individual
development account’’ means a trust created or
organized in the United States exclusively for
the purpose of paying the qualified expenses of
an eligible individual, but only if the written
governing instrument creating the trust meets
the following requirements:
(i) No contribution will be accepted
unless it is in cash or by check.
(ii) The trustee is a federally insured
financial institution.
(iii) The assets of the trust will be in-
vested in accordance with the direction of
the eligible individual after consultation
with the qualified entity providing deposits
for the individual under section 10 of this
Act.
(iv) The assets of the trust will not be
commingled with other property except in
a common trust fund or common invest-
ment fund.
(v) Except as provided in clause (vi),
any amount in the trust which is attrib-
utable to a deposit provided under section
10 of this Act may be paid or distributed
out of the trust only for the purpose of
paying the qualified expenses of the eligible
individual.
(vi) Any balance in the trust on the
day after the date on which the individual
for whose benefit the trust is established
dies shall be distributed within 30 days of
that date as directed by that individual to
another individual development account es-
tablished for the benefit of an eligible indi-
vidual.
(B) CUSTODIAL ACCOUNTS.—For purposes
of subparagraph (A), a custodial account shall
be treated as a trust if the assets of the custo-
dial account are held by a bank (as defined in
section 408(n) of the Internal Revenue Code of
1986) or another person who demonstrates, to
the satisfaction of the Secretary, that the man-
ner in which such person will administer the
custodial account will be consistent with the re-
quirements of this Act, and if the custodial ac-
count would, except for the fact that it is not
a trust, constitute an individual development
account described in subparagraph (A). For
purposes of this Act, in the case of a custodial
account treated as a trust by reason of the pre-
ceding sentence, the custodian of that custodial
account shall be treated as the trustee thereof.
(5) PROJECT YEAR.—The term ‘‘project year’’
means, with respect to a demonstration project, any
of the 4 consecutive 12-month periods beginning on
the date the project is originally authorized to be
conducted.
(6) QUALIFIED ENTITY.—
(A) IN GENERAL.—The term ‘‘qualified en-
tity’’ means—
(i) one or more not-for-profit organi-
zations described in section 501(c)(3) of
the Internal Revenue Code of 1986 and ex-
empt from taxation under section 501(a)
of such Code; or
(ii) a State or local government agen-
cy submitting an application under section
5 jointly with an organization described in
clause (i).
(B) RULE OF CONSTRUCTION.—Nothing in
this paragraph shall be construed as preventing
an organization described in subparagraph
(A)(i) from collaborating with a financial insti-
tution or for-profit community development cor-
poration to carry out the purposes of this Act.
(7) QUALIFIED EXPENSES.—The term ‘‘quali-
fied expenses’’ means 1 or more of the following, as
provided by the qualified entity:
(A) POSTSECONDARY
EDUCATIONAL
EX-
PENSES.—Postsecondary educational expenses
paid from an individual development account di-
rectly to an eligible educational institution. In
this subparagraph:
(i) POST-SECONDARY
EDUCATIONAL
EXPENSES.—The 
term 
‘‘post-secondary
educational expenses’’ means the following:
(I) TUITION AND FEES.—Tuition
and fees required for the enrollment
or attendance of a student at an eligi-
ble educational institution.
(II) FEES, 
BOOKS, 
SUPPLIES,
AND EQUIPMENT.—Fees, books, sup-
plies, and equipment required for
courses of instruction at an eligible
educational institution.
(ii) ELIGIBLE EDUCATIONAL INSTITU-
TION.—The term ‘‘eligible educational in-
stitution’’ means the following:
(I) INSTITUTION
OF
HIGHER
EDUCATION.—An institution described
in section 481(a)(1) or 1201(a) of the
Higher Education Act of 1965 (20
U.S.C. 1088(a)(1) or 1141(a)), as
such sections are in effect on the date
of enactment of this Act.
(II) 
POSTSECONDARY
VOCA-
TIONAL
EDUCATION
SCHOOL.—An
area vocational education school (as
defined in subparagraph (C) or (D) of
section 521(4) of the Carl D. Perkins
Vocational and Applied Technology
Education Act (20 U.S.C. 2471(4)))
which is in any State (as defined in
section 521(33) of such Act), as such
sections are in effect on the date of
enactment of this Act.
(B) FIRST-HOME
PURCHASE.—Qualified
acquisition costs with respect to a qualified
principal residence for a qualified first-time
homebuyer, if paid from an individual develop-
ment account directly to the persons to whom
the amounts are due. In this subparagraph:
(i) QUALIFIED ACQUISITION COSTS.—
The term ‘‘qualified acquisition costs’’
means the costs of acquiring, constructing,
or reconstructing a residence. The term in-
cludes any usual or reasonable settlement,
financing, or other closing costs.
(ii) 
QUALIFIED
PRINCIPAL
RESI-
DENCE.—The term ‘‘qualified principal
residence’’ means a principal residence
(within the meaning of section 1034 of the
Internal Revenue Code of 1986), the quali-
fied acquisition costs of which do not ex-
ceed 100 percent of the average area pur-
chase price applicable to such residence
(determined in accordance with paragraphs
(2) and (3) of section 143(e) of such
Code).
(iii) QUALIFIED
FIRST-TIME
HOME-
BUYER.—
(I) 
IN
GENERAL.—The 
term
‘‘qualified 
first-time 
homebuyer’’
means an individual participating in
the project (and, if married, the indi-
vidual’s spouse) who has no present
ownership interest in a principal resi-
dence during the 3-year period ending
on the date of acquisition of the prin-
cipal residence to which this subpara-
graph applies.
(II) DATE
OF
ACQUISITION.—
The term ‘‘date of acquisition’’ means
the date on which a binding contract
to acquire, construct, or reconstruct
the principal residence to which this
subparagraph applies is entered into.
(C) BUSINESS CAPITALIZATION.—Amounts
paid from an individual development account di-
rectly to a business capitalization account which
is established in a federally insured financial in-
stitution and is restricted to use solely for
qualified business capitalization expenses. In
this subparagraph:
(i) QUALIFIED BUSINESS CAPITALIZA-
TION
EXPENSES.—The term ‘‘qualified
business capitalization expenses’’ means
qualified expenditures for the capitalization
of a qualified business pursuant to a quali-
fied plan.
(ii) QUALIFIED EXPENDITURES.—The
term ‘‘qualified expenditures’’ means ex-
penditures included in a qualified plan, in-
cluding capital, plant, equipment, working
capital, and inventory expenses.
(iii) QUALIFIED BUSINESS.—The term
‘‘qualified business’’ means any business
that does not contravene any law or public
policy (as determined by the Secretary).
(iv) QUALIFIED
PLAN.—The term
‘‘qualified plan’’ means a business plan, or
a plan to use a business asset purchased,
which—
(I) is approved by a financial in-
stitution, a microenterprise develop-
ment organization, or a nonprofit loan
fund having demonstrated fiduciary
integrity;
(II) includes a description of
services or goods to be sold, a market-
ing plan, and projected financial
statements; and
(III) may require the eligible in-
dividual to obtain the assistance of an
experienced entrepreneurial adviser.
(D) TRANSFERS TO IDAS OF FAMILY MEM-
BERS.—Amounts paid from an individual devel-
opment account directly into another such ac-
count established for the benefit of an eligible
individual who is—
(i) the individual’s spouse; or
(ii) any dependent of the individual
with respect to whom the individual is al-
lowed a deduction under section 151 of the
Internal Revenue Code of 1986.
(8) QUALIFIED SAVINGS OF THE INDIVIDUAL
FOR THE PERIOD.—The term ‘‘qualified savings of
the individual for the period’’ means the aggregate
of the amounts contributed by the individual to the
individual development account of the individual
during the period.
(9) SECRETARY.—The term ‘‘Secretary’’ means
the Secretary of Health and Human Services.
SEC. 5. APPLICATIONS.
(a) SUBMISSION.—Not later than 6 months after the
date of enactment of this Act, a qualified entity may sub-
mit to the Secretary an application to conduct a dem-
onstration project under this Act.
(b) CRITERIA.—In considering whether to approve an
application to conduct a demonstration project under this
Act, the Secretary shall assess the following:
(1) SUFFICIENCY OF PROJECT.—The degree to
which the project described in the application ap-
pears likely to aid project participants in achieving
economic self-sufficiency through activities requiring
qualified expenses. In making such assessment, the
Secretary shall consider the overall quality of project
activities in making any particular kind or combina-
tion of qualified expenses to be an essential feature
of any project.
(2) ADMINISTRATIVE ABILITY.—The experience
and ability of the applicant to responsibly administer
the project.
(3) ABILITY
TO
ASSIST
PARTICIPANTS.—The
experience and ability of the applicant in recruiting,
educating, and assisting project participants to in-
crease their economic independence and general well-
being through the development of assets.
(4) COMMITMENT OF NON-FEDERAL FUNDS.—
The aggregate amount of direct funds from non-
Federal public sector and from private sources that
are formally committed to the project as matching
contributions.
(5) ADEQUACY OF PLAN FOR PROVIDING IN-
FORMATION
FOR
EVALUATION.—The adequacy of
the plan for providing information relevant to an
evaluation of the project.
(6) OTHER FACTORS.—Such other factors rel-
evant to the purposes of this Act as the Secretary
may specify.
(c) PREFERENCES.—In considering an application to
conduct a demonstration project under this Act, the Sec-
retary shall give preference to an application that—
(1) demonstrates the willingness and ability to
select individuals described in section 8 who are pre-
dominantly from households in which a child (or
children) is living with the child’s biological or adop-
tive mother or father, or with the child’s legal guard-
ian;
(2) provides a commitment of non-Federal
funds with a proportionately greater amount of such
funds committed by private sector sources; and
(3) targets such individuals residing within 1 or
more relatively well-defined neighborhoods or com-
munities (including rural communities) that experi-
ence low rates of income or employment.
(d) APPROVAL.—Not later than 9 months after the
date of enactment of this Act, the Secretary shall, on a
competitive basis, approve such applications to conduct
demonstration projects under this Act as the Secretary
deems appropriate, taking into account the assessments
required by subsections (b) and (c). The Secretary is en-
couraged to ensure that the applications that are approved
involve a range of communities (both rural and urban) and
diverse populations.
(e) CONTRACTS WITH NONPROFIT ENTITIES.—The
Secretary may contract with an entity described in section
501(c)(3) of the Internal Revenue Code of 1986 and ex-
empt from taxation under section 501(a) of such Code to
conduct any responsibility of the Secretary under this sec-
tion or section 12 if—
(1) such entity demonstrates the ability to con-
duct such responsibility; and
(2) the Secretary can demonstrate that such re-
sponsibility would not be conducted by the Secretary
at a lower cost.
SEC. 6. DEMONSTRATION AUTHORITY; ANNUAL GRANTS.
(a) DEMONSTRATION AUTHORITY.—If the Secretary
approves an application to conduct a demonstration
project under this Act, the Secretary shall, not later than
10 months after the date of enactment of this Act, author-
ize the applicant to conduct the project for 4 project years
in accordance with the approved application and the re-
quirements of this Act.
(b) GRANT AUTHORITY.—For each project year of a
demonstration project conducted under this Act, the Sec-
retary shall make a grant to the qualified entity author-
ized to conduct the project on the first day of the project
year in an amount not to exceed the lesser of—
(1) the aggregate amount of funds committed
as matching contributions by non-Federal public or
private sector sources; or
(2) $1,000,000.
SEC. 7. RESERVE FUND.
(a) ESTABLISHMENT.—A qualified entity under this
Act, other than a State or local government agency, shall
establish a Reserve Fund which shall be maintained in ac-
cordance with this section.
(b) AMOUNTS IN RESERVE FUND.—
(1) IN GENERAL.—As soon after receipt as is
practicable, a qualified entity shall deposit in the Re-
serve Fund established under subsection (a)—
(A) all funds provided to the qualified en-
tity by any public or private source in connec-
tion with the demonstration project; and
(B) the proceeds from any investment
made under subsection (c)(2).
(2) UNIFORM
ACCOUNTING
REGULATIONS.—
The Secretary shall prescribe regulations with re-
spect to accounting for amounts in the Reserve
Fund established under subsection (a).
(c) USE OF AMOUNTS IN THE RESERVE FUND.—
(1) IN GENERAL.—A qualified entity shall use
the amounts in the Reserve Fund established under
subsection (a) to—
(A) assist participants in the demonstra-
tion project in obtaining the skills (including
economic literacy, budgeting, credit, and coun-
seling) and information necessary to achieve
economic self-sufficiency through activities re-
quiring qualified expenses;
(B) provide deposits in accordance with
section 10 for individuals selected by the quali-
fied entity to participate in the demonstration
project;
(C) administer the demonstration project;
and
(D) provide the research organization eval-
uating the demonstration project under section
14 with such information with respect to the
demonstration project as may be required for
the evaluation.
(2) AUTHORITY TO INVEST FUNDS.—
(A) GUIDELINES.—The Secretary shall es-
tablish guidelines for investing amounts in the
Reserve Fund established under subsection (a)
in a manner that provides an appropriate bal-
ance between return, liquidity, and risk.
(B) INVESTMENT.—A qualified entity shall
invest the amounts in its Reserve Fund that are
not immediately needed to carry out the provi-
sions of paragraph (1), in accordance with the
guidelines established under subparagraph (A).
(3) LIMITATION ON USES.—Not more than 7.5
percent of the amounts provided to a qualified entity
under section 6(b) shall be used by the qualified en-
tity for the purposes described in subparagraphs
(A), (C), and (D) of paragraph (1), except that if
2 or more qualified entities are jointly administering
a project, no qualified entity shall use more than its
proportional share for such purposes.
(d) UNUSED
FEDERAL
GRANT
FUNDS
TRANS-
FERRED TO THE SECRETARY WHEN PROJECT TERMI-
NATES.—Notwithstanding subsection (c), upon the termi-
nation of any demonstration project authorized under this
section, the qualified entity conducting the project shall
transfer to the Secretary an amount equal to—
(1) the amounts in its Reserve Fund at time of
the termination; multiplied by
(2) a percentage equal to—
(A) the aggregate amount of grants made
to the qualified entity under section 6(b); di-
vided by
(B) the aggregate amount of all funds pro-
vided to the qualified entity by all sources to
conduct the project.
SEC. 8. ELIGIBILITY FOR PARTICIPATION.
(a) IN GENERAL.—Any individual who is a member
of a household that is eligible for assistance under the
State temporary assistance for needy families program es-
tablished under part A of title IV of the Social Security
Act (42 U.S.C. 601 et seq.), or that meets the following
requirements shall be eligible to participate in a dem-
onstration project conducted under this Act:
(1) INCOME TEST.—The adjusted gross income
of the household does not exceed the income limits
established under section 32(b)(2) of the Internal
Revenue Code of 1986.
(2) NET WORTH TEST.—
(A) IN GENERAL.—The net worth of the
household, as of the end of the calendar year
preceding the determination of eligibility, does
not exceed $10,000.
(B) DETERMINATION
OF
NET
WORTH.—
For purposes of subparagraph (A), the net
worth of a household is the amount equal to—
(i) the aggregate market value of all
assets that are owned in whole or in part
by any member of the household; minus
(ii) the obligations or debts of any
member of the household.
(C) EXCLUSIONS.—For purposes of deter-
mining the net worth of a household, a house-
hold’s assets shall not be considered to include
the primary dwelling unit and 1 motor vehicle
owned by the household.
(b) INDIVIDUALS
UNABLE
TO
COMPLETE
THE
PROJECT.—The Secretary shall establish such regulations
as are necessary, including prohibiting future eligibility to
participate in any other demonstration project conducted
under this Act, to ensure compliance with this Act if an
individual participating in the demonstration project
moves from the community in which the project is con-
ducted or is otherwise unable to continue participating in
that project.
SEC. 9. SELECTION OF INDIVIDUALS TO PARTICIPATE.
From among the individuals eligible to participate in
a demonstration project conducted under this Act, each
qualified entity shall select the individuals—
(1) that the qualified entity deems to be best
suited to participate; and
(2) to whom the qualified entity will provide de-
posits in accordance with section 10.
SEC. 10. DEPOSITS BY QUALIFIED ENTITIES.
(a) IN GENERAL.—Not less than once every 3 months
during each project year, each qualified entity under this
Act shall deposit in the individual development account of
each individual participating in the project, or into a par-
allel account maintained by the qualified entity—
(1) from the non-Federal funds described in
section 5(b)(4), a matching contribution of not less
than $0.50 and not more than $4 for every $1 of
earned income (as defined in section 911(d)(2) of
the Internal Revenue Code of 1986) deposited in the
account by a project participant during that period;
(2) from the grant made under section 6(b), an
amount equal to the matching contribution made
under paragraph (1); and
(3) any interest that has accrued on amounts
deposited under paragraph (1) or (2) on behalf of
that individual into the individual development ac-
count of the individual or into a parallel account
maintained by the qualified entity.
(b) LIMITATION
ON DEPOSITS
FOR
AN INDIVID-
UAL.—Not more than $2,000 from a grant made under
section 6(b) shall be provided to any 1 individual over the
course of the demonstration project.
(c) LIMITATION ON DEPOSITS FOR A HOUSEHOLD.—
Not more than $4,000 from a grant made under section
6(b) shall be provided to any 1 household over the course
of the demonstration project.
(d) WITHDRAWAL OF FUNDS.—The Secretary shall
establish such guidelines as may be necessary to ensure
that funds held in an individual development account are
not withdrawn, except for 1 or more qualified expenses.
Such guidelines shall include a requirement that a respon-
sible official of the qualified entity conducting a project
approve such withdrawal in writing.
SEC. 
11. 
LOCAL 
CONTROL 
OVER 
DEMONSTRATION
PROJECTS.
A qualified entity under this Act, other than a State
or local government agency, shall, subject to the provisions
of section 13, have sole authority over the administration
of the project. The Secretary may prescribe only such reg-
ulations or guidelines with respect to demonstration
projects conducted under this Act as are necessary to en-
sure compliance with the approved applications and the
requirements of this Act.
SEC. 12. ANNUAL PROGRESS REPORTS.
(a) IN GENERAL.—Each qualified entity under this
Act shall prepare an annual report on the progress of the
demonstration project. Each report shall specify for the
period covered by the report the following information:
(1) The number of individuals making a deposit
into an individual development account.
(2) The amounts in the Reserve Fund estab-
lished with respect to the project.
(3) The amounts deposited in the individual de-
velopment accounts.
(4) The amounts withdrawn from the individual
development accounts and the purposes for which
such amounts were withdrawn.
(5) The balances remaining in the individual
development accounts.
(6) Such other information as the Secretary
may require to evaluate the demonstration project.
(b) SUBMISSION OF REPORTS.—The qualified entity
shall submit each report required to be prepared under
subsection (a) to—
(1) the Secretary; and
(2) the Treasurer (or equivalent official) of the
State in which the project is conducted, if the State
or a local government committed funds to the dem-
onstration project.
(c) TIMING.—The first report required by subsection
(a) shall be submitted not later than 60 days after the
end of the calendar year in which the Secretary authorized
the qualified entity to conduct the demonstration project,
and subsequent reports shall be submitted every 12
months thereafter, until the conclusion of the project.
SEC. 13. SANCTIONS.
(a) AUTHORITY TO TERMINATE DEMONSTRATION
PROJECT.—If the Secretary determines that a qualified
entity under this Act is not operating the demonstration
project in accordance with the entity’s application or the
requirements of this Act (and has not implemented any
corrective recommendations directed by the Secretary),
the Secretary shall terminate such entity’s authority to
conduct the demonstration project.
(b) ACTIONS REQUIRED UPON TERMINATION.—If
the Secretary terminates the authority to conduct a dem-
onstration project, the Secretary—
(1) shall suspend the demonstration project;
(2) shall take control of the Reserve Fund es-
tablished pursuant to section 7;
(3) shall make every effort to identify another
qualified entity (or entities) willing and able to con-
duct the project in accordance with the approved ap-
plication (or, as modified, if necessary to incorporate
the recommendations) and the requirements of this
Act;
(4) shall, if the Secretary identifies an entity
(or entities) described in paragraph (3)—
(A) authorize the entity (or entities) to
conduct the project in accordance with the ap-
proved application (or, as modified, if nec-
essary, to incorporate the recommendations)
and the requirements of this Act;
(B) transfer to the entity (or entities) con-
trol over the Reserve Fund established pursuant
to section 7; and
(C) consider, for purposes of this Act—
(i) such other entity (or entities) to be
the qualified entity (or entities) originally
authorized to conduct the demonstration
project; and
(ii) the date of such authorization to
be the date of the original authorization;
and
(5) if, by the end of the 1-year period beginning
on the date of the termination, the Secretary has not
found a qualified entity (or entities) described in
paragraph (3), shall—
(A) terminate the project; and
(B) from the amount remaining in the Re-
serve Fund established as part of the project,
remit to each source that provided funds under
section 5(b)(4) to the entity originally author-
ized to conduct the project, an amount that
bears the same ratio to the amount so remain-
ing as the amount provided by the source under
section 5(b)(4) bears to the amount provided by
all such sources under that section.
SEC. 14. EVALUATIONS.
(a) IN GENERAL.—Not later than 10 months after
the date of enactment of this Act, the Secretary shall enter
into a contract with an independent research organization
to evaluate, individually and as a group, all qualified enti-
ties and sources participating in the demonstration
projects conducted under this Act.
(b) FACTORS TO EVALUATE.—In evaluating any
demonstration project conducted under this Act, the re-
search organization shall address the following factors:
(1) The savings account characteristics (such as
threshold amounts and match rates) required to
stimulate participation in the demonstration project,
and how such characteristics vary among different
populations or communities.
(2) What service configurations of the qualified
entity (such as peer support, structured planning ex-
ercises, mentoring, and case management) increase
the rate and consistency of participation in the dem-
onstration project and how such configurations vary
among different populations or communities.
(3) The economic, civic, psychological, and so-
cial effects of asset accumulation, and how such ef-
fects vary among different populations or commu-
nities.
(4) The effects of individual development ac-
counts on savings rates, homeownership, level of
education attained, and self-employment, and how
such effects vary among different populations or
communities.
(5) The potential financial returns to the Fed-
eral Government and to other public sector and pri-
vate sector investors in individual development ac-
counts over a 5-year and 10-year period of time.
(6) The lessons to be learned from the dem-
onstration projects conducted under this Act and if
a permanent program of individual development ac-
counts should be established.
(7) Such other factors as may be prescribed by
the Secretary.
(c) METHODOLOGICAL REQUIREMENTS.—In evaluat-
ing any demonstration project conducted under this Act,
the research organization shall—
(1) to the extent possible, use control groups to
compare participants with nonparticipants;
(2) before, during, and after the project, obtain
such quantitative data as are necessary to evaluate
the project thoroughly; and
(3) develop a qualitative assessment, derived
from sources such as in-depth interviews, of how
asset accumulation affects individuals and families.
(d) REPORTS BY THE SECRETARY.—
(1) INTERIM REPORTS.—Not later than 90 days
after the end of the calendar year in which the Sec-
retary first authorizes a qualified entity to conduct
a demonstration project under this Act, and every
12 months thereafter until all demonstration
projects conducted under this Act are completed, the
Secretary shall submit to Congress an interim report
setting forth the results of the reports submitted
pursuant to section 12(b).
(2) FINAL
REPORTS.—Not later than 12
months after the conclusion of all demonstration
projects conducted under this Act, the Secretary
shall submit to Congress a final report setting forth
the results and findings of all reports and evalua-
tions conducted pursuant to this Act.
(e) EVALUATION EXPENSES.—The Secretary shall
expend such sums as may be necessary to carry out the
purposes of this section.
SEC. 15. AUTHORIZATIONS OF APPROPRIATIONS.
There is authorized to be appropriated to carry out
this Act, $25,000,000 for each of fiscal years 1998, 1999,
2000, and 2001, to remain available until expended.
SEC. 16. FUNDS IN INDIVIDUAL DEVELOPMENT ACCOUNTS
OF 
DEMONSTRATION 
PROJECT 
PARTICI-
PANTS DISREGARDED FOR PURPOSES OF ALL
MEANS-TESTED FEDERAL PROGRAMS.
Notwithstanding any other provision of law that re-
quires consideration of 1 or more financial circumstances
of an individual, for the purpose of determining eligibility
to receive, or the amount of, any assistance or benefit au-
thorized by such law to be provided to or for the benefit
of such individual, funds (including interest accruing) in
an individual development account (as defined in section
4(4)) shall be disregarded for such purpose with respect
to any period during which the individual participates in
a demonstration project conducted under this Act (or
would be participating in such a project but for the sus-
pension of the project).
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