A bill to establish a small business child care grant program, and for other purposes.

SECTION 1. SHORT TITLE.

    This Act may be cited as the ``Small Business Child Care Act''.

SEC. 2. SMALL BUSINESS CHILD CARE GRANT PROGRAM.

    (a) Establishment.--The Secretary of Health and Human Services 
(referred to in this section as the ``Secretary'') shall establish a 
program to award grants to States, on a competitive basis, to assist 
States in providing funds to encourage the establishment and operation 
of employer-operated child care programs.
    (b) Application.--To be eligible to receive a grant under this 
section, a State shall prepare and submit to the Secretary an 
application at such time, in such manner, and containing such 
information as the Secretary may require, including an assurance that 
the funds required under subsection (e) will be provided.
    (c) Amount and Period of Grant.--The Secretary shall determine the 
amount of a grant to a State under this section based on the population 
of the State as compared to the population of all States receiving 
grants under this section. The Secretary shall make the grant for a 
period of 3 years.
    (d) Use of Funds.--
            (1) In general.--A State shall use amounts provided under a 
        grant awarded under this section to provide assistance to small 
        businesses (or consortia formed in accordance with paragraph 
        (3)) located in the State to enable the small businesses (or 
        consortia) to establish and operate child care programs. Such 
        assistance may include--
                    (A) technical assistance in the establishment of a 
                child care program;
                    (B) assistance for the startup costs related to a 
                child care program;
                    (C) assistance for the training of child care 
                providers;
                    (D) scholarships for low-income wage earners;
                    (E) the provision of services to care for sick 
                children or to provide care to school-aged children;
                    (F) the entering into of contracts with local 
                resource and referral organizations or local health 
                departments;
                    (G) assistance for care for children with 
                disabilities;
                    (H) payment of expenses for renovation or operation 
                of a child care facility; or
                    (I) assistance for any other activity determined 
                appropriate by the State.
            (2) Application.--In order for a small business or 
        consortium to be eligible to receive assistance from a State 
        under this section, the small business involved shall prepare 
        and submit to the State an application at such time, in such 
        manner, and containing such information as the State may 
        require.
            (3) Preference.--
                    (A) In general.--In providing assistance under this 
                section, a State shall give priority to an applicant 
                that desires to form a consortium to provide child care 
                in a geographic area within the State where such care 
                is not generally available or accessible.
                    (B) Consortium.--For purposes of subparagraph (A), 
                a consortium shall be made up of 2 or more entities 
                that shall include small businesses and that may 
                include large businesses, nonprofit agencies or 
                organizations, local governments, or other appropriate 
                entities.
            (4) Limitations.--With respect to grant funds received 
        under this section, a State may not provide in excess of 
        $500,000 in assistance from such funds to any single applicant.
    (e) Matching Requirement.--To be eligible to receive a grant under 
this section, a State shall provide assurances to the Secretary that, 
with respect to the costs to be incurred by a covered entity receiving 
assistance in carrying out activities under this section, the covered 
entity will make available (directly or through donations from public 
or private entities) non-Federal contributions to such costs in an 
amount equal to--
            (1) for the first fiscal year in which the covered entity 
        receives such assistance, not less than 50 percent of such 
        costs ($1 for each $1 of assistance provided to the covered 
        entity under the grant);
            (2) for the second fiscal year in which the covered entity 
        receives such assistance, not less than 66\2/3\ percent of such 
        costs ($2 for each $1 of assistance provided to the covered 
        entity under the grant); and
            (3) for the third fiscal year in which the covered entity 
        receives such assistance, not less than 75 percent of such 
        costs ($3 for each $1 of assistance provided to the covered 
        entity under the grant).
    (f) Requirements of Providers.--To be eligible to receive 
assistance under a grant awarded under this section, a child care 
provider--
            (1) who receives assistance from a State shall comply with 
        all applicable State and local licensing and regulatory 
        requirements and all applicable health and safety standards in 
        effect in the State; and
            (2) who receives assistance from an Indian tribe or tribal 
        organization shall comply with all applicable regulatory 
        standards.
    (g) State-Level Activities.--A State may not retain more than 3 
percent of the amount described in subsection (c) for State 
administration and other State-level activities.
    (h) Administration.--
            (1) State responsibility.--A State shall have 
        responsibility for administering a grant awarded for the State 
        under this section and for monitoring covered entities that 
        receive assistance under such grant.
            (2) Audits.--A State shall require each covered entity 
        receiving assistance under the grant awarded under this section 
        to conduct an annual audit with respect to the activities of 
        the covered entity. Such audits shall be submitted to the 
        State.
            (3) Misuse of funds.--
                    (A) Repayment.--If the State determines, through an 
                audit or otherwise, that a covered entity receiving 
                assistance under a grant awarded under this section has 
                misused the assistance, the State shall notify the 
                Secretary of the misuse. The Secretary, upon such a 
                notification, may seek from such a covered entity the 
                repayment of an amount equal to the amount of any such 
                misused assistance plus interest.
                    (B) Appeals process.--The Secretary shall by 
                regulation provide for an appeals process with respect 
                to repayments under this paragraph.
    (i) Reporting Requirements.--
            (1) 2-year study.--
                    (A) In general.--Not later than 2 years after the 
                date on which the Secretary first awards grants under 
                this section, the Secretary shall conduct a study to 
                determine--
                            (i) the capacity of covered entities to 
                        meet the child care needs of communities within 
                        States;
                            (ii) the kinds of consortia that are being 
                        formed with respect to child care at the local 
                        level to carry out programs funded under this 
                        section; and
                            (iii) who is using the programs funded 
                        under this section and the income levels of 
                        such individuals.
                    (B) Report.--Not later than 28 months after the 
                date on which the Secretary first awards grants under 
                this section, the Secretary shall prepare and submit to 
                the appropriate committees of Congress a report on the 
                results of the study conducted in accordance with 
                subparagraph (A).
            (2) 4-year study.--
                    (A) In general.--Not later than 4 years after the 
                date on which the Secretary first awards grants under 
                this section, the Secretary shall conduct a study to 
                determine the number of child care facilities that are 
                funded through covered entities that received 
                assistance through a grant awarded under this section 
                and that remain in operation, and the extent to which 
                such facilities are meeting the child care needs of the 
                individuals served by such facilities.
                    (B) Report.--Not later than 52 months after the 
                date on which the Secretary first awards grants under 
                this section, the Secretary shall prepare and submit to 
                the appropriate committees of Congress a report on the 
                results of the study conducted in accordance with 
                subparagraph (A).
    (j) Definitions.--In this section:
            (1) Covered entity.--The term ``covered entity'' means a 
        small business or a consortium formed in accordance with 
        subsection (d)(3).
            (2) Indian community.--The term ``Indian community'' means 
        a community served by an Indian tribe or tribal organization.
            (3) Indian tribe; tribal organization.--The terms ``Indian 
        tribe'' and ``tribal organization'' have the meanings given the 
        terms in section 658P of the Child Care and Development Block 
        Grant Act of 1990 (42 U.S.C. 9858n).
            (4) Small business.--The term ``small business'' means an 
        employer who employed an average of at least 2 but not more 
        than 50 employees on the business days during the preceding 
        calendar year.
            (5) State.--The term ``State'' has the meaning given the 
        term in section 658P of the Child Care and Development Block 
        Grant Act of 1990 (42 U.S.C. 9858n).
    (k) Application to Indian Tribes and Tribal Organizations.--In this 
section:
            (1) In general.--Except as provided in subsection (f)(1), 
        and in paragraphs (2) and (3), the term ``State'' includes an 
        Indian tribe or tribal organization.
            (2) Geographic references.--The term ``State'' includes an 
        Indian community in subsections (c) (the second and third place 
        the term appears), (d)(1) (the second place the term appears), 
        (d)(3)(A) (the second place the term appears), and 
        (i)(1)(A)(i).
            (3) State-level activities.--The term ``State-level 
        activities'' includes activities at the tribal level.
    (l) Authorization of Appropriations.--
            (1) In general.--There is authorized to be appropriated to 
        carry out this section, $50,000,000 for the period of fiscal 
        years 2008 through 2012.
            (2) Studies and administration.--With respect to the total 
        amount appropriated for such period in accordance with this 
        subsection, not more than $2,500,000 of that amount may be used 
        for expenditures related to conducting studies required under, 
        and the administration of, this section.
    (m) Termination of Program.--The program established under 
subsection (a) shall terminate on September 30, 2012.

Summary: Small Business Child Care Act - Directs the Secretary of Health and Human Services to establish a program to award grants, on a competitive basis, to assist states in providing funds to encourage the establishment and operation of employer-operated child care programs.