eligible for insurance under section 2 or a mort-
gagee approved under section 203(b)(1);
‘‘(E) comply with other such terms, condi-
tions, and restrictions as the Secretary may
prescribe; and
‘‘(F) be made with respect to a child care
and development facility that complies with the
requirement under subsection (d).
‘‘(3) INSURANCE REQUIREMENTS.—The provi-
sions of paragraphs (5), (6), (7), (9), and (10) of
section 220(h) shall apply to loans insured under
this subsection, except that all references in such
paragraphs to home improvement loans shall be con-
sidered, for purposes of this subsection, to refer to
loans under this subsection. The provisions of sub-
sections (c), (d), and (h) of section 2 shall apply to
loans insured under this subsection, except that all
references in such subsections to ‘this section’ or
‘this title’ shall be considered, for purposes of this
subsection, to refer to this subsection.
‘‘(i) SCHEDULES AND DEADLINES.—The Secretary
shall establish schedules and deadlines for the processing
and approval (or provision of notice of disapproval) of ap-
plications for mortgage insurance under this section.
‘‘(j) DEFINITIONS.—For the purposes of this section,
the following definitions shall apply:
‘‘(1) CHILD CARE AND DEVELOPMENT FACIL-
ITY.—The term ‘child care and development facility’
means a public facility, proprietary facility, or facil-
ity of a private nonprofit corporation or association
that—
‘‘(A) has as its purpose the care and devel-
opment of children less than 12 years of age;
and
‘‘(B) is licensed or regulated by the State
in which it is located (or, if there is no State
law providing for such licensing and regulation
by the State, by the municipality or other polit-
ical subdivision in which the facility is located).
The term does not include facilities for school-age
children primarily for use during normal school
hours. The term includes facilities for training indi-
viduals to provide child care and development serv-
ices.
‘‘(2) DISTRESSED AREA.—The term ‘distressed
area’ means an area that—
‘‘(A) meets the requirements under sub-
chapter U of chapter I of the Internal Revenue
Code (26 U.S.C. 1391 et seq.) for designation
as an enterprise community or empowerment
zone under such subchapter; or
‘‘(B) is a census tract that has a median
income that does not exceed 50 percent of the
median income for the region in which the cen-
sus tract is located, as determined by the Sec-
retary.
For purposes of subparagraph (B), a region shall be
determined by the Secretary in the same manner as
areas are determined for purposes of determining in-
come limitations for assistance under section 8 of
the United States Housing Act of 1937 (42 U.S.C.
1437f).
‘‘(3) EQUIPMENT.—The term ‘equipment’ in-
cludes machinery, utilities, and built-in equipment
and any necessary enclosures or structures to house
them, and any other items necessary for the func-
tioning of a particular facility as a child care and
development facility, including necessary furniture.
Such term includes books, curricular, and program
materials.
‘‘(4) MORTGAGE; 
FIRST
MORTGAGE; 
MORT-
GAGEE.—The term ‘mortgage’ means a first mort-
gage on real estate in fee simple, or on the interest
of either the lessor or lessee thereof under a lease
having a period of not less than 7 years to run be-
yond the maturity date of the mortgage. The term
‘first mortgage’ means such classes of first liens as
are commonly given to secure advances (including
advances during construction) on, or the unpaid pur-
chase price of, real estate under the laws of the
State in which the real estate is located, together
with the credit instrument or instruments (if any)
secured thereby, and any mortgage may be in the
form of one or more trust mortgages or mortgage
indentures or deeds of trust, securing notes, bonds,
or other credit instruments, and, by the same instru-
ment or by a separate instrument, may create a se-
curity interest in initial equipment, whether or not
attached to the realty. The term ‘mortgagor’ has the
meaning given the term in section 207(a).
‘‘(k) LIMITATION ON INSURANCE AUTHORITY.—
‘‘(1) TERMINATION.—No mortgage may be in-
sured under this section or section 223(h) after Sep-
tember 30, 2012, except pursuant to a commitment
to insure issued on or before such date.
‘‘(2) AGGREGATE PRINCIPAL AMOUNT LIMITA-
TION.—The aggregate principal amount of mort-
gages for which the Secretary enters into commit-
ments to insure under this section or section 223(h)
on or before the date under paragraph (1) may not
exceed $2,000,000,000. If, upon the date under
paragraph (1), the aggregate insurance authority
provided under this paragraph has not been fully
used, the Secretary of the Treasury shall submit a
report to the Congress evaluating the need for con-
tinued mortgage insurance under this section.’’.
‘‘(l) REGULATIONS.—The Secretary shall issue any
regulations necessary to carry out this section. In issuing
such regulations, the Secretary shall consult with the Sec-
retary of Health and Human Services with respect to any
aspects of the regulations regarding child care and devel-
opment facilities.’’.
SEC. 4. INSURANCE FOR MORTGAGES FOR ACQUISITION OR
REFINANCING DEBT OF EXISTING CHILD
CARE AND DEVELOPMENT FACILITIES.
Section 223 of the National Housing Act (12 U.S.C.
1715n) is amended by adding at the end the following new
subsection:
‘‘(h) MORTGAGE INSURANCE FOR PURCHASE OR RE-
FINANCING OF EXISTING CHILD CARE AND DEVELOP-
MENT FACILITIES.—
‘‘(1) AUTHORITY.—Notwithstanding any other
provision of this Act, the Secretary may insure
under any section of this title a mortgage executed
in connection with the purchase or refinancing of an
existing child care and development facility, the pur-
chase of a structure to serve as a child care and
development facility, or the refinancing of existing
debt of an existing child care and development facil-
ity.
‘‘(2) PURCHASE OF EXISTING FACILITIES AND
STRUCTURES.—In the case of the purchase under
this subsection of an existing child care and develop-
ment facility or purchase of an existing structure to
serve as such a facility, the Secretary shall prescribe
any terms and conditions that the Secretary con-
siders necessary to ensure that—
‘‘(A) the facility or structure purchased
continues to be used as a child care and devel-
opment facility; and
‘‘(B) the facility complies with the same
requirements applicable under section 257(d) to
facilities having mortgages insured under such
section.
‘‘(3) REFINANCING OF EXISTING FACILITIES.—
In the case of refinancing of an existing child care
and development facility, the Secretary shall pre-
scribe any terms and conditions that the Secretary
considers necessary to ensure that—
‘‘(A) the refinancing is used to lower the
monthly debt service costs (taking into account
any fees or charges connected with such refi-
nancing) of the existing facility;
‘‘(B) the proceeds of any refinancing will
be employed only to retire the existing indebted-
ness and pay the necessary cost of refinancing
on the existing facility;
‘‘(C) the existing facility is economically
viable; and
‘‘(D) the facility complies with the same
requirements applicable under section 257(d) to
facilities having mortgages insured under such
section.
‘‘(4) DEFINITIONS.—For purposes of this sub-
section, the terms defined in section 257(j) shall
have the same meanings as provided under such sec-
tion.
‘‘(5) LIMITATION ON INSURANCE AUTHORITY.—
The authority of the Secretary to enter into commit-
ments to insure mortgages under this subsection is
subject to the limitations under section 257(k).’’.
SEC. 5. CHILDREN’S DEVELOPMENT COMMISSION.
Title II of the National Housing Act (12 U.S.C. 1707
et seq.) is amended by adding at the end (after section
257, as added by section 3 of this Act) the following new
section:
‘‘CHILDREN’S DEVELOPMENT COMMISSION (KIDDIE MAC)
‘‘SEC. 258. (a) ESTABLISHMENT.—There is hereby
established a commission to be known as the Children’s
Development Commission or Kiddie Mac.
‘‘(b) MEMBERSHIP.—
‘‘(1) APPOINTMENT.—The Commission shall be
composed of 7 members appointed by the President,
not later than the expiration of the 3-month period
beginning upon the enactment of this section, by and
with the advice and consent of the Senate, as fol-
lows:
‘‘(A) The Secretary of Housing and Urban
Development or the Secretary’s designee.
‘‘(B) The Secretary of Health and Human
Services or the Secretary’s designee.
‘‘(C) The Secretary of the Treasury or the
Secretary’s designee.
‘‘(D) 4 members shall be appointed from
among 12 individuals recommended jointly by
the Speaker of the House of Representatives,
the Majority Leader of the Senate, Minority
Leader of the House of Representatives, the
Minority Leader of the Senate.
‘‘(2) QUALIFICATIONS
OF
CONGRESSIONALLY
RECOMMENDED
MEMBERS.—Of the members ap-
pointed under paragraph (1)(D)—
‘‘(A) each shall be an individual who ac-
tively participates or is employed in the field of
child care and has academic, licensing, or other
credentials relating to such participation or em-
ployment; and
‘‘(B) not more than 2 may be of the same
political party.
‘‘(3) TERMS.—Each appointed member of the
Commission shall serve for a term of 3 years.
‘‘(4) VACANCIES.—Any member appointed to
fill a vacancy occurring before the expiration of the
term for which the member’s predecessor was ap-
pointed shall be appointed only for the remainder of
that term. A member may serve after the expiration
of that member’s term until a successor has taken
office. A vacancy in the Commission shall be filled
in the manner in which the original appointment was
made.
‘‘(5) CHAIRPERSON.—The chairperson of the
Commission shall be designated by the President at
the time of appointment.
‘‘(6) QUORUM.—A majority of the members of
the Commission shall constitute a quorum for the
transaction of business.
‘‘(7) VOTING.—Each member of the Commis-
sion shall be entitled to 1 vote, which shall be equal
to the vote of every other member of the Commis-
sion.
‘‘(8) PROHIBITION
ON
ADDITIONAL
PAY.—
Members of the Commission shall serve without
compensation, but shall be reimbursed for travel,
subsistence, and other necessary expenses incurred
in the performance of their duties as members of the
Commission.
‘‘(c) FUNCTIONS.—The Commission shall carry out
the following functions:
‘‘(1) CERTIFICATION
OF
COMPLIANCE.—The
Commission shall collect such information and make
such determinations as may be necessary to deter-
mine, for purposes of section 257(d), whether child
care and development facilities comply, or will be in
compliance within 12 months, with—
‘‘(A) any laws, standards, and require-
ments applicable to such facilities under the
laws of the State, municipality, or other unit of
general local government in which the facility is
or is to be located, and
‘‘(B) after the effective date of the stand-
ards and requirements established under para-
graph (2), such standards and requirements,
and shall issue certifications of such compliance.
‘‘(2) ESTABLISHMENT OF STANDARDS.—
‘‘(A) STUDY.—Not later than 12 months
after the date on which appointment of initial
membership of the Commission is completed,
the Commission, in consultation with the Sec-
retary of Housing and Urban Development and
the Secretary of Health and Human Services,
shall conduct a study to determine the laws,
standards, and requirements referred to in
paragraph (1)(A) that are applicable in each
State. Taking into consideration the findings of
the study, the Secretary shall establish stand-
ards and requirements regarding child care and
development facilities that are designed to en-
sure that mortgage insurance is provided under
section 257 and section 223(h) only for safe,
clean, and healthy facilities that provide appro-
priate care and development services for chil-
dren.
‘‘(B) 
PUBLICATION.—The 
Commission
shall issue regulations providing for the stand-
ards and requirements established under sub-
paragraph (A) to take effect, for purposes of
sections 257(d)(2) and 223(h)(2)(B) and para-
graph (1)(B) of this section, not later than 18
months after the date of the enactment of this
section.
‘‘(3) SMALL
PURPOSE
LOANS.—The Commis-
sion shall, to the extent amounts are made available
for such purpose pursuant to subsection (i) and
qualified requests are received, make loans, directly
or indirectly to providers of child care and develop-
ment facilities for reconstruction or renovation of
such facilities, subject to the following requirements:
‘‘(A) Loans under this paragraph shall be
made only for such facilities that are financially
and operationally viable, as determined under
standards and guidelines to be established by
the Commission.
‘‘(B) The aggregate amount of loans made
under this paragraph to a single borrower may
not exceed $50,000.
‘‘(C) A loan made under this paragraph
may not have a term exceeding 15 years.
‘‘(D) Loans under this paragraph shall
bear interest at rates and be made under such
other conditions and terms as the Commission
shall provide.
‘‘(4) NOTIFICATION.—The Commission shall
take such actions as may be necessary to publicize
the availability of the programs for mortgage insur-
ance under sections 257 and 223(h) and loans under
paragraph (3) of this subsection in a manner that
ensures that information concerning such programs
will be available to child care providers throughout
the United States.
‘‘(5) TECHNICAL
ASSISTANCE.—The Commis-
sion shall make available, to mortgagors of mort-
gages insured under section 257 or 223(h) and to
borrowers under paragraph (3) of this subsection,
technical assistance and expertise in the business as-
pects of operating child care and development facili-
ties (including business planning and quality control
assistance). The Commission shall provide such as-
sistance and expertise directly and in coordination
with appropriate Federal agencies (including the De-
partment of Housing and Urban Development, the
Department of Health and Human Services, the De-
partment of Defense, and the Small Business Ad-
ministration),
‘‘(6) LIABILITY INSURANCE.—The Commission
shall—
‘‘(A) not later than 12 months after the
date on which appointment of initial member-
ship of the Commission is completed—
‘‘(i) establish standards and guide-
lines, applicable to mortgage insurance
under sections 257 and 223(h) and loans
under paragraph (3) of this subsection,
that require child care providers operating
child care and development facilities as-
sisted under such provisions to obtain and
maintain 
liability 
insurance 
in 
such
amounts and subject to such requirements
as the Commission considers appropriate;
and
‘‘(ii) submit a report to the Congress
that analyzes the need for making financial
and technical assistance available to such
child care providers to identify and obtain
liability insurance adequate to comply with
such standards and guidelines, identifies
appropriate methods of providing such as-
sistance, sets forth a program for the Com-
mission to provide such technical assist-
ance, and makes recommendations for any
legislation necessary to implement a pro-
gram to provide such appropriate financial
assistance; and
‘‘(B) beginning not later than the effective
date of the standards and guidelines established
under subparagraph (A)(i), carry out the tech-
nical assistance program set forth in the report
under subparagraph (A)(ii).
‘‘(7) RESEARCH FOUNDATION.—Not later than
12 months after the date of the enactment of this
section, the Commission shall submit a report to the
Congress recommending a plan for establishing and
funding a foundation that is an entity independent
of the Commission (but which maintains association
with the Commission)—
‘‘(A) which shall have as its purpose—
‘‘(i) to support research relating to
child care and development facilities;
‘‘(ii) to fund pilot programs to test in-
novative methods for improving child care;
and
‘‘(iii) to engage in activities and pub-
lish materials to assist persons interested
in mortgage insurance under sections 257
and 223(h) and other assistance provided
by the Commission; and
‘‘(B) which shall have the authority to ac-
cept, use, and dispose of gifts, bequests, or de-
vises of services or property, both real and per-
sonal, for the purpose of aiding or facilitating
the work of the foundation.
‘‘(8) STUDY
REGARDING
CAPITAL
NEEDS
OF
CENTER-BASED CHILD CARE IN LOW-INCOME COM-
MUNITIES.—The Commission shall provide for the
conducting of a study of center-based child care for
families in low-income communities and neighbor-
hoods that—
‘‘(A) determines the existing supply and
quality of such care in such areas;
‘‘(B) identifies the economic and other
market barriers in such areas to—
‘‘(i) creating an adequate supply of
center-based child care services; and
‘‘(ii) achieving a quality standard in
child care centers adequate to support
early childhood programs; and
‘‘(C) proposes public policy and private
sector initiatives that might be taken to ensure
that such areas have—
‘‘(i) a supply of center-based child
care facilities sufficient for child care needs
of the areas and to facilitate employment
and support the goals of welfare reform;
‘‘(ii) appropriate child care choices;
and
‘‘(iii) sufficient quality of care nec-
essary to prepare at-risk children for
school.
The Commission shall submit to the Congress a re-
port regarding the results of the study conducted
under this section not later than the expiration of
the 18-month period beginning on the date of the
appointment of the executive director pursuant to
subsection (f)(1).
‘‘(d) NONDISCRIMINATION REQUIREMENT.—
‘‘(1) IN GENERAL.—The Commission may not
certify under subsection (c)(1) or carry out any ac-
tivities of the Commission with respect to any child
care and development facility if the provider of the
facility discriminates on account of race, color, reli-
gion (subject to paragraph (2)), national origin, sex
(to the extent provided in title IX of the Education
Amendments of 1972 (20 U.S.C. 1681 et seq.)), or
handicapping condition.
‘‘(2) FACILITIES
OF
RELIGIOUS
ORGANIZA-
TIONS.—The prohibition with respect to religion
shall not apply to a child care and development facil-
ity which is controlled by or which is closely identi-
fied with the tenets of a particular religious organi-
zation if the application of this subsection would not
be consistent with the religious tenets of such orga-
nization.
‘‘(3) CERTIFICATION.—As a condition of certifi-
cation under subsection (c)(1) and eligibility for a
loan under subsection (c)(3), the provider of a child
care and development facility shall certify to the
Commission that the provider does not discriminate,
as required by the provisions of paragraph (1) of
this subsection.
‘‘(e) POWERS.—
‘‘(1) ASSISTANCE FROM FEDERAL AGENCIES.—
The Commission may secure directly from any de-
partment or agency of the Federal Government such
information as the Commission may require for car-
rying out its functions. Upon request of the Com-