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The Adolescent Family Life Act (AFLA) is a United States federal law enacted during the Reagan Administration as part of the Omnibus Budget Reconciliation Act of 1981 AFLA provided funding for a series of social programs aimed at promoting abstinence through reproductive health education.
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PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 357
Public Law 97-35
97th Congress
An Act
To provide for reconciliation pursuant to section 301 of the first concurrent resolution Aug. 13, 1981
on the budget for the fiscal year 1982. [H.R. 3982]
SHORT TITLE
SECTION 1. This Act may be cited as the "Omnibus Budget Recon- Omnibus Budget
ciliation Act of 1981". AS on98i'°"
TABLE OF CONTENTS
Title I. Agriculture, forestry, and related programs.
Title II. Armed services and defense-related programs.
Title III. Banking, housing, and related programs.
Title IV. District of Columbia.
Title V. Education programs.
Title VI. Human services programs.
Title VII. Employment programs.
Title VIII. School lunch and child nutrition programs.
Title IX. Health services and facilities.
Title X. Energy and energy-related programs.
Title XI. Transportation and related programs.
Title XII. Consumer product safety and communications.
Title XIII. International affairs.
Title XIV. Department of Interior and related programs.
Title XV. Department of Justice and related provisions.
Title XVI. Maritime and related programs.
Title XVII. Civil service and postal service programs; governmental affairs
generally.
Title XVIII. Water resource development and economic development programs.
Title XIX. Small business.
Title XX. Veterans' programs.
Title XXI. Medicare, medicaid, and maternal and child health.
Title XXII. Federal Old-Age, Survivors, and Disability Insurance program.
Title XXIII. Public assistance programs.
Title XXIV. Unemployment compensation.
Title XXV. Trade adjustment assistance.
Title XXVI. Low-income home energy assistance.
Title XXVII. Health professions.
PURPOSE
SEC. 2. It is the purpose of this Act to implement the recommenda-
tions which were made by specified committees of the House of
Representatives and the Senate pursuant to directions contained in
part A of title III of the first concurrent resolution on the budget for
the fiscal year 1982 (H. Con. Res. 115,97th Congress), and pursuant to
the reconciliation requirements which were imposed by such concur-
rent resolution as provided in section 310 of the Congressional Budget
Act of 1974. 31 use 1331.
95 STAT. 358 PUBLIC LAW 97-35—AUG. 13, 1981
TITLE I—AGRICULTURE, FORESTRY, AND
RELATED PROGRAMS
Subtitle A—Food Stamp Prog^ram Reductions and
Other Reductions in Authorization for Appropriations
PART 1—FOOD STAMP PROGRAM REDUCTIONS
FAMILY UNIT REQUIREMENT
7 use 2012. SEC. 101. Section 3(i) of the Food Stamp Act of 1977 is amended b y -
CD inserting before the period at tne end of the first sentence ";
except that parents and children who live together shall be
treated as a group of individuals who customari^ purchase and
prepare meals together for home consumption even if they do not
do so, unless one of the parents is sixty years of age or older"; and
(2) striking out "neither" in the second sentence and inserting
"no" in lieu thereof.
BOARDERS
SEC. 102. Section 8(i) of the Food Stamp Act of 1977 is amended b y -
CD striking out in clause (1) of the first sentence "or else pays
compensation to the others for such meals,";
(2) striking out in clause (2) of the first sentence "or else live
with others and pay compensation to the others for such meals";
and
(3) adding before the period at the end of the second sentence ",
or else live with others and pay compensation to the others for
meals".
ADJUSTMENT OF THE THRIFTY FOOD PLAN
SEC. 103. Section 3(o) of the Food Stamp Act of 1977 is amended by
striking out "and" before clause (6) and all that follows down through
the end of clause (6), and inserting in lieu thereof the following: "(6)
on April 1, 1982, ai^just the cost of such diet to the nearest dollar
increment to reflect changes in the cost of the thrifty food plan for the
fifteen months ending the preceding December 31, (7) on July 1,1983,
adjust the cost of such diet to the nearest dollar increment to reflect
changes in the cost of the thriffy food plan for the fifteen months
ending the preceding March 31, (8) on October 1,1984, adjust the cost
of such diet to the nearest dollar increment to reflect changes in the
cost of the thrifty food plan for the fifteen months ending the
preceding June 30, and (9) on October 1, 1985, and each October 1,
thereafter, adjust the cost of such diet to the nearest dollar increment
to reflect changes in the cost of the thrifty food plan for the twelve
months ending the preceding June 30".
GROSS INCOME ELIGIBILITY STANDARD
7 use 2014. SEC. 104. (a) Section 5 of the Food Stamp Act of 1977 is amended
by-
CD striking out everything before "adjusted annually" in the
first sentence of subsection (c) and inserting the following:
"(c) The income standards of eligibility shall be—
"(1) for households contaimng a member who is sixty years of
age or over or a member who receives suptplemental security
42 use 1381. income benefits under title XVI of the Social Security Act or
PUBLIC LAW 97-35—AUG. 13,1981 96 STAT. 359
disability and blindness payments under titles I, II, X, XIV, and
XVI of the Social Security Act, 100 per centum, and 42 USC 30i, 40i,
"(2) for all other households, 130 per centum, ^^^i' ^^^^' ^^si
of the nonfarm income poverty guidelines prescribed by the Office of
Management and Budget"; and
(2) inserting "for purposes of determining eligibility and bene-
fit levels for households described in subsection (cXD and deter-
mining benefit levels only for all other households'' after "house-
hold income'' in the first sentence of subsection (e).
(b) Section 8(a) of the Food Stamp Act of 1977 is amended by ? use 2017.
inserting "(d) and (e)" after "section 5" in the first sentence.
ADJUSTMENTS OF DEDUCTIONS
SEC. 105. Section 5(e) of the Food Stamp Act of 1977 is amended 7 use 2014.
by-
(1) striking out in the first sentence everything that follows
"the Secretary shall allow a standard deduction o f and inserting
in lieu thereof the following: "$85 a month for each household,
except that households in Alaska, Hawaii, Guam, Puerto Rico,
and the Virgin Islands of the United States shall be allowed a
standard deduction of $145, $120, $170, $50, and $75, respec-
tively.";
(2) striking out the second sentence and inserting in lieu
thereof the following: "Such standard deductions shall be ad-
justed (1) on July 1,1983, to the nearest $5 increment to reflect
changes in the Consumer Price Index for all urban consumers
published by the Bureau of Labor Statistics, for items other than
food and the homeownership component of shelter costs, as
appropriately adjusted by the Bureau of Labor Statistics after
consultation with the Secretary, for the fifteen months ending
the preceding March 31, (2) on October 1,1984, to the nearest $5
increment to reflect such changes for the fifteen months ending
the preceding June 30, and (3) on October 1, 1985, and each
October 1 thereafter, to the nearest $5 increment to reflect such
changes for the twelve months ending the preceding June 30.";
and
(3) striking out the proviso in clause (2) of the fourth sentence
and inserting in lieu thereof the following: "Provided, That the
amount of such excess shelter expense deduction shall not exceed
$115 a month in the forty-eight contiguous States and the
District of Columbia, and shall not exceed, in Alaska, Hawaii,
Guam, Puerto Rico, and the Virgin Islands of the United States,
$200, $165, $140, $40, and $85, respectively, ac^justed (i) on July 1,
1983, to the nearest $5 increment to reflect changes in the shelter
(exclusive of homeownership costs), fuel, and utilities compo-
nents of housing costs in the Consumer Price Index for all urban
consumers published by the Bureau of Labor Statistics, as
appropriately adjusted by the Bureau of Labor Statistics s^er
consultation with the Secretary, for the fifteen months ending
the preceding March 31, (ii) on October 1,1984, to the nearest $5
increment to reflect such changes for the fifteen months ending
the preceding June 30, and (iii) on October 1, 1985, and each
October 1 thereafter, to the nearest $5 increment to reflect such
changes for the twelve months ending the preceding June 30,".
-194 0—82 25:QL3
95 STAT. 360 PUBLIC LAW 97-35—AUG. 13, 1981
EARNED INCOME DEDUCTION
7 use 2014. SEC. 106. Section 5(e) of the Food Stamp Act of 1977 is amended by
striking out "20 per centum" in the thini sentence and inserting in
lieu thereof "18 per centum".
RETROSPECTIVE ACCOUNTING
SEC. 107. (a) Section 5(f) of the Food Stamp Act of 1977 is amended
to read as follows:
"(fKlXA) Household income for those households that, by contract
for other than an hourly or piecework basis or by self-employment,
derive their annual income in a period of time shorter than one year
shall be calculated by averaging such income over a twelve-month
period.
"(B) Household income for those households that receive nonex-
cluded income of the type described in subsection (dX3) of this section
shsQl be calculated by averaging such income over the period for
which it is received.
"(2XA) Household income for migrant farmworker households shall
be c^culated on a propsective basis, as provided in paragraph (3XA).
"(B) Household income for all other households shall be calculated
either on a prospective basis as provided in paragraph (3XA) or on a
retrospective basis as provided in paragraph (3XB), as elected by the
State agency under regulations prescribed by the Secretary.
"(3XA) Calculation of household income on a prospective basis is
the calculation of income on the basis of the income reasonably
anticipated to be received by the household during the period for
which eligibility or benefits are being determined. Such calculation
shall be made in accordance with regulations prescribed by the
Secretary which shall provide for taking into account both the
income reasonably anticipated to be received by the household during
the period for which eligibility or benefits are being determined and
the income received by the household during the preceding thirty
days.
"(B) Calculation of household income on a retrospective basis is the
ceilculation of income for the period for which eligibility or benefits
are being determined on the basis of income received in a previous
period. Such calculation shall be made in accordance with regula-
tions prescribed by the Secretary which may provide for the determi-
nation of eligibility on a prospective basis in some or all cases in
which benefits are calculated under this paragraph. Such regulations
shall provide for supplementing the initisd sdlotments of newly
applying households in those cases in which the determination of
income under this paragraph causes serious hardship.
"(4) In promulgating regulations under this subsection, the Secre-
tary shall consult with the Secretary of Health and Human Services
in order to assure that, to the extent feasible and consistent with the
42 use 1305. purposes of this Act and the Social Security Act, the income of
households receiving benefits under this Act and title IV-A of the
42 use 601. Social Security Act is calculated on a comparable basis under the two
Acts. The Secretary is authorized, upon the request of a State agency,
to waive any of the provisions of this subsection to the extent
necessary to permit the State agency to calculate income for purposes
of this Act on the same basis that income is calculated under title
IV-A of the Social Security Act in that State.".
PUBLIC LAW 97-35—AUG. 13,1981 95 STAT. 361
(b) Effective October 1,1983, paragraph (2XB) of section 5(f) of the
Food Stamp Act of 1977, as amended by subsection (a), is amended to 7 use 2014.
read as follows:
"(B) Household income for all other households shall be calculated
on a retrospective basis as provided in paragraph (3XB).".
(c) Section 5(d) of the Food Stamp Act of 1977 is amended by
striking out "5(fX2)" and inserting "5(f)" in lieu thereof.
PERIODIC REPORTING
SEC. 108. (a) Section 3(c) of the Food Stamp Act of 1977 is amended ? use 2012.
by inserting before the period at the end of the second sentence
"except that the limit of twelve months may be waived by the
Secretary to improve the administration of the program".
(b) Section 6(c) of the Food Stamp Act of 1977 is amended by— ^ use 2015.
(1) inserting after "households" in the first sentence of para-
graph (1)", including all households with earned income, except
migrant farmworker households, all households with potential
earners, including individuals receiving unemployment compen-
sation benefits and individuals required by section 6(d) of this Act
to register for work, and all households required to file a similar
report under title IV-A of the Social Security Act, but not 42use60i.
including households that have no earned income and in which
all members are sixty years of age or over or receive supplemen-
tal security income benefits under title XVI of the Social Secu- 42 use 1381.
rity Act or disability and blindness payments under titles I, II, X,
XIV, and XVI of the Social Security Act,"; 42 use 30i, 40i,
(2) strildng out "5(fX2)" in paragraph (1) and inserting "5(f)" in 1201,135i, I38i.
lieu thereof; and
(3) inserting after paragraph (3) the following new paragraph:
"(4) Any household that fails to submit periodic reports required by
paragraph (1) shall not receive an allotment for the pajmient period
to which the unsubmitted report applies until such report is submit-
ted.".
(c) Effective October 1,1983, section 6(cXl) of the Food Stamp Act of
1977 is further amended by— 7 use 20i5.
(1) striking out in the first sentence "that elect to use a system
of retrospective accounting in accordance with section 5(f) of this
Act"; and
(2) striking out the second sentence.
ELIGIBILITY OF STRIKERS
SEC. 109. (a) Section 6(dX4) of the Food Stamp Act of 1977 is
amended by—
(1) inserting before the colon at the end of the first proviso the
following: ", however, such household shall not receive an
increased allotment as the result of a decrease in the income of
the striking member or members of the household";
(2) inserting a period in lieu of the colon at the end of the
second proviso; and
(3) striking out the third proviso.
(b) Section 6(i) of the Food Stamp Act of 1977 is repealed.
PRORATING FIRST MONTH BENEFITS
SBC. 110. Section 8 of the Food Stamp Act of 1977 is amended by 7 use 2017.
adding at the end thereof the following new subsection:
95 STAT. 362 PUBLIC LAW 97-35—AUG. 13, 1981
"(c) The value of the allotment issued to any eligible household for
the initial month or other initial period for which an allotment is
issued shall have a value which bears the same ratio to the value of
the allotment for a full month or other initial period for which the
allotment is issued as the number of days (from the date of appUca-
tion) remaining in the month or other initial period for which the
allotment is issued bears to the total number of days in the month or
"Initial month." other initio period for which the allotment is issued. As used in this
subsection, the term 'initial month* means (1) the first month for
wMch an allotment is issued to a household, and (2) the first month
for which an allotment is issued to a household following any period
of more than thirty days which such household was not participating
in the food stamp program under this Act after previous participation
in such program. .
OUTREACH
7 use 2020. SEC. 111. (a) Section IKeXD of the Food Stamp Act of 1977 is
amended by striking out clauses (A) and (B) and redesignating
existing clause (C) as (B) and inserting the following new clause (A):
(A) not conduct food stamp outreach activities with funds
provided under this Act;".
7 use 2025. (b) Section 16(a) of that Act is amended by—
(1) striking out clause (1); and
(2) redesignating clauses (2), (3), (4), and (5) as clauses (1), (2), (3),
and (4), respectively.
DISQUALIFICATION PENALTIES FOR FRAUD AND MISREPRESENTATION
7 use 2015. SEC. 112. Section 6(b) of the Food Stamp Act of 1977 is amended to
read as follows:
"(bXD Anjr person who has been found by any State or Federal
court or administrative agency to have intentionally (A) made a false
or misleading statement, or misrepresented, concealed or withheld
facts, or (B) committed any act that constitutes a violation of this Act,
the regulations issued thereunder, or any State statute, for the
purpose of using, presenting, transferring, acquiring, receiving, or
possessing coupons or authorization cards shall, immediately upon
the rendering of such determination, become ineligible for mrther
participation in the program—
(i) for a period of six months upon the first occasion of any
such determination;
"(ii) for a period of one year upon the second occasion of any
such determination; and
"(iii) permanently upon the third occasion of any such determi-
nation.
During the period of such ineligibility, no household shall receive
increased benefits under this Act as the result of a member of such
household having been disqualified under this subsection.
"(2) Each State agency shall proceed against an individual alleged
to have engaged in such activity eitiier by way of administrative
hearings, a£ter notice and an opportunity for a hearing at the State
level, or by referring such matters to appropriate authorities for civil
or criminal action in a court of law.
"(3) Such periods of ineligibili^ as are provided for in par^raph (1)
of this subsection shall remain in enect, without possibility of
administrative stay, unless and until the finding upon which the
ineligibility is based is subsequently reversed by a court of appropri-
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 363
ate jurisdiction, but in no event shall the period of ineligibility be
subject to review.
"(4) The Secretary shall prescribe such regulations as the Secretary Regulations.
may deem appropriate to ensure that information concerning any
such determination with respect to a specific individual is forwarded
to the Office of the Secretary by any appropriate State or Federal
entity for the use of the Secreta^ in administering the provisions of
this section. No State shall withhold such information from the
Secretsury or the Secretary's designee for any reason whatsoever.".
WAIVING AND OFFSETTING CLAIMS; IMPROVED RECOVERY OF
OVERPAYMENTS
SEC. 113. (a) Section 13 of the Food Stamp Act of 1977 is amended 7 use 2022.
by-
CD inserting "(a)" immediately after the section designation;
(2) inserting before the period at the end of the first sentence ",
including the power to waive claims if the Secretary determines
that to do so would serve the purposes of this Act";
(3) adding the following new sentence at the end thereof: "The
Secretary shall have the power to reduce amounts otherwise due
to a State agency under section 16 of this Act to collect unpaid 7 use 2025.
claims assessed against the State agency if the State agency has
declined or exhausted its appeal rights under section 14 of this
Act."; and 7 use 2023.
(4) adding the following new subsection at the end thereof:
"(b)(1) In the case of any ineligibility determination under section
6(b) of this Act, the household of which such inelmble individual is a
member is required to agree to a reduction in the allotment of the
household of which such individual is a member, or payment in cash,
in accordance with a schedule determined by the Secretary, that will
be sufficient to reimburse the Federal Government for the value of
any overissuance of coupons resulting from the activity that was the
basis of the ineligibility determination. If a household refuses to
make an election, or elects to make a payment in cash under the
provisions of the preceding sentence and fsSls to do so, the household
shall be subject to an allotment reduction.
"(2) State agencies shall collect any claim against a household
arising from the overissuance of coupons, other than claims the
collection of which is provided for in paragraph (1) of this subsection
and claims arising from an error of the State agency, by reducing the
monthly allotments of the household. These collections shall be
limited to 10 per centum of the monthly allotment (or $10 per month,
whenever that would result in a faster collection rate).".
(b) The heading of section 13 of the Food Stamp Act of 1977 is 7 use 2022.
amended to read COLLECTION AND DISPOSITION OF CLAIMS".
STATES' SHARE OF COLLECTED CLAIMS
SEC. 114. Section 16(a) of the Food Stamp Act of 1977 is amended ? use 2025.
by-
(1) striking out in the first sentence "through prosecutions"
and all that follows down through the end of the sentence and
inserting in lieu thereof "pursuant to section 13(bXl) of this Act Supra.
and 25 per centum of the value of all funds or allotments
recovered or collected pursuant to section 13(bX2) of this Act."; Supra.
and
95 STAT. 364 PUBLIC LAW 97-35—AUG. 13, 1981
(2) striking out in the second sentence "fraud" and inserting in
lieu thereof ineligibility".
REPEAL OF INCREASES IN DEPENDENT CARE DEDUCTIONS FOR WORKING
ADULTS AND MEDICAL DEDUCTIONS FOR THE ELDERLY AND DISABLED
Repeals. SEC. 115. Sections 104 and 105 of the Food Stamp Act Amendments
7 if^ySand ^^ ^^^^ (Public Law 96-249) are repealed.
note.
PUERTO RICO BLOCK GRANT
SEC. 116. (a) Effective July 1,1982, the Food Stamp Act of 1977 is
amended b y ^
(1) striking out "Puerto Rico/' in section 3(m), clause (3) of
5 use 2012, section 3(o), section 5(b), wherever it appears in section 5(c), and
1 i i r. QCQ wherever it appears in section 5(e); and striking out "$50," and
Ante, p. 359. « ^ Q „ ^ ^ ^ . ^ ^ g^^^. ^ ^
(2) adding at the end thereof tiie following new section:
" B L O C K GRANT
7 use 2028. "SEC. 19. (aXlXA) From the sums appropriated under this Act the
Secretary shall, subject to the provisions of this subsection and
subsection (b), pay to the Commonwealth of Puerto Rico not to exceed
$825,000,000 for each fiscal year to finance 100 per centum of the
expenditures for food assistance provided to needy persons, and 50
per centum of the administrative expenses related to the provision of
such assistance.
"(B) The payments to the Commonwealth for any fiscal year shall
not exceed the expenditures by that jurisdiction during that year for
the provision of m e assistance the provision of which is included in
the plan of the Commonwealth approved under subsection (b) and 50
per centum of the related administrative expenses.
"(2) The Secretary shall, subject to the provisions of subsection Oi>),
pay to the Commonwealth for me applicable fiscal year, at such times
and in such manner as the Secretary may determine, the amount
estimated bjr the Commonwealth pursuant to subsection (bXlXAXiv),
reduced or increased to the extent of any prior overpayment or
current under^yment which the Secretary determines has been
made under tms section and with respect to which acijustment has
not already been made under this subsection.
"(bXlXA) In order to receive payments under this Act for any fiscal
year, the Commonwealth shall have a plan for that fiscal year
approved by the Secretary under tins section. By July 1 of each year,
if the Commonwealth wishes to receive payments, it shall submit a
plan for the provision of the assistance described in subsection
(aXlXA) for the following fiscal year which—
"(i) desi^ates a single agen(^ which shall be responsible for
the administration, or supervision of the administration, of the
program for the provision of such assistance;
"(ii) assesses the food and nutrition needs of needy persons
residing in the Commonwealth;
"(iii) describes the program for the provision of such assistance,
including the assistance to be provided and the persons to whom
such assistance will be provided, and any agencies designated to
provide such assistance, which program must meet such require-
ments as the Secretary may hy r^^ulation prescribe for the
PUBLIC LAW 97-35—AUG. 13,1981 95 STAT. 366
purpose of assuring that assistance is provided to the most needy
persons in the jurisdiction;
"(iv) estimates the amoimt of expenditures necessary for the
provision of the assistance described in the program and related
administrative expenses, up to the amount provided for payment
by subsection (aXlXA); and
"(v) includes such other information as the Secretary may
require.
"(BXi) The Secretary shall approve or disapprove any plan sub-
mitted pursuant to subparagr^h (A) no later than August 1 of the
year in which it is submitted. Ine Secretary shall approve any plan
which complies with the requirements of subparagraph (A). If a plan
is disapproved because it does not comply with any of the require-
ments of that paragraph the Secretary shall, except as provided in
subparagraph (BXii), notify the appropriate agency in the C!ommon-
wealth that payments will not be made to it under subsection (a) for
the fiscal year to which the plan applies until the Secretary is
satisfied that there is no longer amr such failure to comply, and until
the Secretary is so satisfied, the Secretary will make no pa3nnents.
"(ii) The Secretary may suspend the denial of payments under
subparagraph (BXi) for such period as the Secretary determines
appropriate and instead withhold payments provided for under
subsection (a), in whole or in part, for the fiscal vear to which the plan
applies, until the Secretary is satisfied that tnere is no longer any
failure to comply with the requirements of subparagraph (A), at
which time such withheld payments shall be paid.
"(2XA) The Commonwealth shall provide for a biennial audit of
expenditures under its program for the provision of the assistance
described in subsection (aXlXA), and within 120 days of the end of
each fiscal year in which the audit is made, shall report to the
Secretary the findings of such audit.
"(B) Within 120 days of the end of the fiscal year, the Common-
wealth shall provide the Secretary with a statement as to whether
the pa5mients received under subsection (a) for that fiscal year
exceeded the expenditures by it during that year for which payment
is authorized under this section, and if so, by how much, and such
other information as the Secretary may require.
"(CXi) If the Secretary finds that there is a substantial failure by
the Commonwealth to comply with any of the requirements of
subparagraphs (A) and (B), or to comply with the requirements of
subsection (bXlXA) in the administration of a plan approved under
subsection (bXlXB), the Secretary shall, except as provided in subpar-
agraph (CXii), notify the appropriate agency in the Commonwealth
that further payments will not be made to it under subsection (a)
until the Secretary is satisfied that there will no longer be any such
failure to comply, and until the Secretary is so satisfied, the Secretary
shall make no further payments.
"(ii) The Secretary may suspend the termination of payments
under subparagraph (CXi) for such period as the Secretary deter-
mines appropriate, and instead withhold pa3m[ients provided for
under subsection (a), in whole or in part, until the Secretary is
satisfied that there will no longer be any failure to comply with the
requirements of subparagraphs (A) and (B) and subsection (bXlXA), at
which time such withheld pajnnents shall be paid,
"(iii) Upon a finding under subparagraph (CXi) of a substantial
failure to comply with any of the requirements of subparagraphs (A)
and (B) and subsection (bXlXA), the Secretary may, in addition to or
in lieu of any action taken under subparagraphs (C)(i) and (CXii), refer
95 STAT. 366 PUBLIC LAW 97-35—AUG. 13, 1981
the matter to the Attorney General with a request that injunctive
relief be sought to require compliance by the Commonwealth of
Puerto Rico, and upon suit Iw the Attorney General in an appropriate
district court of the United States and a snowing that noncompliance
has occurred, appropriate injunctive relief shall issue.
"(cXD The Secretary shall provide for the review of the programs
for the provision of the assistance described in subsection (aXlXA) for
which payments £ire made under this Act.
"(2) The Secretary is authorized as the Secretary deems practicable
to provide technics! assistance with respect to the programs for the
provision of the assistance described in subsection (aXlXA).
Violation; "(d) Whoever knowingly and willfully embezzles, misapplies, steals,
penalty.
or obtains by fraud, false statement, or forgery, any fimds, assets, or
property provided or financed under this section shall be fined not
more than $10,000 or imprisoned for not more than five years, or
both, but if the value of the funds, assets or property involved is not
over $200, the penalty shall be a fine of not more than $1,000 or
imprisonment for not more than one year, or both.".
7 u s e 2028 (b) Notwithstanding the provisions of section 19 of the Food Stamp
note. Act of 1977, as added by this section—
(1) the amount payable to the Commonwealth of Puerto Rico
under section 19 for fiscal year 1982 shall be $206,500,000, and
the Secretary of Agriculture is authorized to ^ a n t such waivers
of the requirements imposed by that section with respect to that
fiscal year as the Secretary determines appropriate to carry out
the purposes of that section; and
Plan, sub- (2) in order to receive the amounts payable under this subsec-
mittal to tion or section 19 for fiscal years 1982 and 1983, the Common-
Secretary.
wealth shall submit, for the Secretary's approval, the plan
required by the provisions of subsection Qji) of section 19 by April
1,1982.
EFFECTIVE DATES
7 u s e 2012 SEC. 117. Except as otherwise specifically provided, the eimend-
note. ments made by sections 101 through 116 of this Act shall be effective
and implemented upon such dates as the Secretary of Agriculture
may prescribe, taking into account the need for orderly implementa-
tion.
PART 2—OTHER REDUCTIONS IN AUTHORIZATIONS FOR
APPROPRIATIONS
AGRICULTURAL AND RELATED PROGRAMS
SEC. 120. Notwithstanding any other provision of law, there are
hereby authorized to be appropriated for the programs designated
below not to exceed the sums shown for each of the fiscal years 1982,
1983, and 1984.
AGRICULTURAL STABILIZATION AND CONSERVATION SERVICE
DAIRY AND BEEKEEPER INDEMNITY PROGRAMS
7 u s e 450j For necessary expenses involved in making indemnity payments to
note. dairy farmers under the Act of August 13, 1968 (7 U.S.C. 450j):
$200,000 for fiscal year 1982, $200,000 for fiscal year 1983, and
$200,000 forfiscalyear 1984.
PUBLIC L A W 97-35—AUG. 13, 1981 95 STAT. 367
AGRICULTURAL MARKETING SERVICE
PAYMENTS TO STATES AND POSSESSIONS
For pavments to departments of agriculture, bureaus and deijart- 7 use 1623 note.
ments of markets, and similar agencies for marketing activities
under section 204(b) of the Agricultural Marketing Act of 1946 (7
U.S.C. 1623(b)): $1,571,000 for fiscal year 1982, $1,651,000 for fiscal
year 1983, and $1,723,000 for fiscal year 1984.
FARMERS HOME ADMINISTRATION
RURAL C O M M U N I T Y FIRE PROTECTION GRANTS
For grants pursuant to section 7 of the Cooperative Forestry 16USC2106
Assistance Act of 1978 (Public Law 95-313): $3,565,000 for fiscal year "ff-^^ ^^ ^^
1982, $3,821,000 for fiscal year 1983, and $4,038,000 for fiscal year ^^ "SC 2106.
1984.
RURAL DEVELOPMENT PLANNING GRANTS
For rural development planning grants pursuant to section 7 use 1926 note.
306(aXll) of the Consolidated Farm and Rural Development Act (7
U.S.C. 1926(aXll)): $4,767,000 for fiscal year 1982, $4,959,000 for fiscal 94 stat. 1174.
year 1983, and $5,155,000 for fiscal year 1984.
RURAL DEVELOPMENT GRANTS
For grants pursuant to section 310B(c) of the Consolidated Farm 7 use 1932 note.
and Rural Development Act (7 U.S.C. 1932): $5,007,000 for fiscal year
1982, $5,280,000 for fiscal year 1983, and $5,553,000 for fiscal year
1984.
SOIL CONSERVATION SERVICE
For necessary expenses for carrying out the programs adminis- 16 use 590f
tered by the Soil Conservation Service: $588,875,000 for fiscal year "^^^^
1982, $596,767,000 for fiscal year 1983, and $602,865,000 for fiscal year
1984.
AGRICULTURAL STABILIZATION AND CONSERVATION SERVICE
AGRICULTURAL CONSERVATION PROGRAM
For necessary expenses to carrv into effect the program authorized I6 use 1510
in sections 7 to 15,16(a), and 17 of the Soil Conservation and Elomestic °°^®
Allotment Act (16 U.S.C. 590g-590o, 590p(a), and 590q), and sections
1001-1008, and 1010 of the Agricultural Act of 1970, as added by the
Agriculture and Consumer Protection Act of 1973 (16 U.S.C.
1501-1508, and 1510): $201,325,000 for fiscal year 1982, $209,647,000
for fiscal year 1983, and $218,216,000 for fiscal year 1984.
FORESTRY INCENTIVES PROGRAM
For necessary expenses, not otherwise provided for, to carry out the 16 use 2103
program of forestry incentives, as authorized in the Cooperative "°*®
Forestry Assistance Act of 1978 (16 U.S.C. 2101): $15,090,000 for fiscal
year 1982, $16,913,000 for fiscal year 1983, and $18,314,000 for fiscal
year 1984.
95 STAT. 368 PUBLIC LAW 97-35—AUG. 13, 1981
WATER BANK PROGRAM
16 use 1310 For necessary expenses to carry into effect the provisions of the
"°*^ Water Bank Act (16 U.S.C. 1301-1311): $10,876,000 for fiscal year
1982, $10,854,000 for fiscal year 1983, and $10,813,000 for fiscal year
1984.
EMERGENCY CONSERVATION PROGRAM
16 use 2204 For necessary expenses to carry into effect the program authorized
^°^- in sections 401,402, and 404 of title IV of the Agricultural Credit Act
of 1978 (16 U.S.C. 2201-2205): $10,069,000 for fiscal year 1982,
$10,507,000 for fiscal year 1983, and $10,958,000 for fiscal year 1984.
WATER AND WASTE GRANTS
SEC. 121. Section 306(aX2) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1926 (aX2)) is amended by striking out the
period at the end of the first sentence and inserting in lieu thereof a
colon and the following: "Provided, That for fiscal years commencing
after September 30,1981, such grants may not exceed $154,900,000 in
any fiscal year.".
FOREST SERVICE
16 use 580o. SEC. 122. Notwithstanding any other provision of law, there are
hereby authorized to be appropriated for the necessary expenses of
the Forest Service for carrying out the programs for Forest Research,
State and Private Forestry, and National Forest System under the
appropriations account for Forest Management, Protection, and
Utilization, and the programs under the appropriations account for
Construction and Land Acquisition: $1,575,552,000 for fiscal year
1981; $1,498,000,000 for fiscal year 1982; $1,560,000,000 for fiscal year
1983; and $1,620,000,000 for fiscal year 1984: Provided, That none of
the funds authorized to be appropriated hereby may be used for
carrying out the Bald Moimtsdn road in the Siskiyou National Forest.
ASSISTANCE TO LAND-GRANT COLLEGES
7 use 322 note. SEC. 123. There are authorized to be appropriated for the purpose of
providing assistance to land-grant colleges under the Act of August
30,1890 (commonly referred to as the "Second Morrill Act") and the
Act of March 4,1907 (7 U.S.C. 322), not to exceed $2,800,000 for the
fiscal year 1981; not to exceed $2,800,000 for the fiscal year 1982; not
to exceed $2,8()0,000 for the fiscal year 1983; and not to exceed
$2,800,000 for the fiscal year 1984.
PUBUC LAW 480 APPROPRIATION UMITS
7 use 1733 note. SEC. 124. Notwithstanding any other provision of law, programs
shall not be undertaken under title I (including title III) and title II of
'7 use 1701, the Agricultural Trade Development and Assistance Act of 1954
1721,1427. during any calendar year which call for an appropriation of more
than $1,304,836,000 for the fiscal year 1982; $1,320,292,000 for the
fiscal year 1983; and $1,402,278,000 for the fiscal year 1984.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 369
PART 3—DEPARTMENT OF AGRICULTURE PERSONNEL
ESTABLISHMENT OF PERSONNEL CEILING
SEC. 125. Notwithstanding any other provision of law, the total full- 7 u s e 2201 note.
time equivalent staff year personnel ceiling for the United States
Department of Agriculture shall not exceed one hundred and seven-
teen thousand staff years (including overtime) for each of the fiscal
years ending September 30,1982, September 30,1983, and September
30,1984.
Subtitle B—Reduction in Direct Spending
PART 1—COMMODITY CREDIT CORPORATION PROGRAMS
MILK PRICE SUPPORT
SEC. 150. Effective October 1,1981, section 201 of the Agricultural
Act of 1949 is amended by— 7 u s e 1446.
(1) striking out the second sentence of subsection (c) and
inserting in lieu thereof the following: "Notwithstanding the
foregoing, effective for the period beginning October 1,1981, and
ending September 30, 1985, the price of milk for the marketing
year beginning on October 1 of each year shall be supported at a
level determined according to the following procedure: The Net Government
Secretary shall estimate Government price support purchases purchases,
estimate.
net of sales for unrestricted use for the marketing year using the
amount of such purchases made during the most recent six-
month period adjusted to an annual level on the basis of the most
recent ten year experience. The Secretary shall adjust this Adjustment
estimate of net Government purchases to reflect the effect of
current and expected availability of feed, feed prices, milk-feed
price ratio, utility cow prices, dairy cow numbers and dairy
heifer replacement stocks on milk production during the market-
ing year. After making this final estimate, the Secretary shall
support the price of milk at not less than the level indicated by
the following schedule, nor more than 90 per centum of the
parity price therefor:
The higher of anticipated annual rate of net Government
purchases
"Price as percent of parity Milk equivalent (butterfat
Nonfat dry milk (million basis) of butter and cheese
pounds) (billion pounds)
75, more than 500 5.5 or more.
76 450-499.9 5.0-5.499.
77, 400-449.9 4.5-4.999.
78, 350-399.9 4.0-4.499.
79, 300-349.9 3.5-3.999.
80 250-299.9 3.0-3.499.
81 200-249.9 2.5-2.999.
82, 150-199.9 2.0-2.499.
83 100-149.9 1.5-1.999.
84 50-99.9 1.0-1.499.
85, less than 50 less than 1.0.
95 STAT. 370 PUBLIC LAW 97-35—AUG. 13, 1981
In no event shall the support price be less than the dollar amount
of the support price then currently in effect for milk: Provided,
That if the Secretary determines that the inventory of dairy
products, at the end of the marketing year, exceeds five hundred
million pounds of nonfat dry milk or five and one-half billion
pounds milk equivalent of butter and cheese, the support price
for the next marketing year shall be established at the minimum
level indicated by this schedule based upon estimated Govern-
ment price support purchases net of sales for unrestricted use for
Notification suchvear. The Secretary shall notify, in writing, the chairman of
to congres- the Innate Committee on Agriculture, Nutrition, and Forestry
sional com-
mittees. and the chairman of the House Committee on Agriculture of the
Secretary's decision and reasons therefor thirty days prior to the
effective date of the new support level. Notwithstanding the
foregoing, if during any marketing year dairy product imports
into the United States are incrased as the result of an expansion
of imports or termination of import restraints established pursu-
7 u s e 624. ant to section 22 of the Agricultural Adjustment Act, the support
price shall be redetermined by reducing the final estimate of net
Government purchases by the milk equivalent (butterfat bsisis) of
dairv products or nonfat dry milk or its equivalent of other
products derived from such increased imports. The increased
support price so determined shall become effective simultaneous-
ly with the announcement of the expansion of dairy product
imports. A similar reduction in the net Government purchases
for the marketing year in which the imports are entered into the
United States shall be made when determining the support price
level for subsequent years."; and
(2) inserting a new subsection (d) as follows:
Effective "(d) Effective for the period beginning October 1,1982, and ending
date. on September 30,1985, the support price of milk shall be adjusted by
the Secretary at the beginning of each semiannual period to reflect
any estimated change in the parity index during said semiannual
period. If a review of net Government purchases as provided for in
subsection (c) indicates that purchases during the most recent six-
month period are being made at an annual rate exceeding five and
one-half billion poun(& milk equivalent Ot)utterfat basis), or five
hundred million pounds of nonfat dry milk, the support price of milk
need not be adjusted unless such adjustment is necessaiy to prevent a
support price at less than 75 per centum of parity as determined at
Notification the beginning of the semiannual period. The Secretary shall notify, in
to congressional writing, the chairman of the Senate Committee on Agriculture,
committees. Nutrition, and Forestry and the chairman of the House Committee
on Agriculture of the Secretary's decision and the reasons therefor
thirty days prior to the effective date of such semiannual ac^ust-
ment.".
FARM STORAGE FACILITY LOANS
SEC. 151. Section 4(h) of the Commodity Credit Corporation Charter
Act (15 U.S.C. 714b(h)) is amended by striking out from the fourth
proviso of the second sentence "shall make loans" and inserting in
lieu thereof "may make loans".
REDUCTION IN CCC ADMINISTRATIVE EXPENSE LIMITATION
15 use 7i3a-io. SEC. 152. Not to excoed $52,000,000 shall be available for the fiscal
year ending September 30,1982, for administrative expenses of the
Commodity Credit Corporation, within the limits of funds and bor-
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 371
rowing authority available to the CJorporation as may be necessary in
carrying out the programs set forth in the budget for the CJorporation.
PART 2-COMMODITY INSPECTION FEES
GRAIN INSPECTION AND WEIGHING
SEC. 155. Effective for the period October 1,1981, through Septem- 7 u s e 79 note.
ber 30, 1984, inclusive, the United States Grain Standards Act is 7 use 71.
amended by—
(1) amending section 7(j) (7 U.S.C. 79(j)) to read as follows:
"(jXl) The Administrator shall, under such regulations as the
Administrator may prescribe, charge and collect reasonable inspec-
tion fees to cover the estimated cost to the Service incident to the
performance of official inspection except when the official inspection
is performed by a designated official agency or by a State under a
delegation of authority. The fees authorized by this subsection shall,
as nearly as practicable and after taking into consideration any
proceeds from the sale of samples, cover the costs of the Service
incident to its performance of official inspection services in the
United States and on United States grain in Canadian ports, includ-
ing administrative and supervisory costs related to such official
inspection of grain. Such fees, and the proceeds from the sale of
samples obtained for purposes of official inspection which become the
property of the United States, shall be deposited into a fund which
shall be available without fiscal year limitation for the expenses of
the Service incident to providing services under this Act.
"(2) Each designated official agency and each State agency to which
authority has been delegated under subsection (e) of this section shall
pay to the Administrator fees in such amount as the Administrator
determines fair and reasonable and as will cover the estimated costs
incurred by the Service relating to supervision of official agency
personnel and supervision by Service personnel of its field office
personnel, except costs incurred under paragraph (3) of subsection (g)
of this section and sections 9,10, and 14 of this Act. The fees shall be 7 u s e 85, 86,
payable after the services are performed at such times as specified by 87c.
the Administrator and shall be deposited in the fund created in
paragraph (1) of this subsection. Failure to pay the fee within thirty Overdue
days after it is due shall result in automatic termination of the fee.
delegation or designation, which sheill be reinstated upon payment,
within such period as specified by the Administrator, of the fee
currently due plus interest and any further expenses incurred by the
Service because of such termination. The interest rate on overdue Interest
fees shall be as prescribed by the Secretary, but not less than the rate.
current average market yield on outstanding marketable obligations
of the United States of comparable maturity, plus an additional
charge of not to exceed 1 per centum per annum as determined by the
Secretary and adjusted to the nearest one-eighth of 1 per centum.";
(2) amending section 7A(1) (7 U.S.C. 79a(l)) to read as follows:
"(IXD The Administrator shall, under such regulations as the
Administrator may prescribe, charge and collect reasonable fees to
cover the estimated costs to the Service incident to the performance
of the functions provided for under this section except as otherwise
provided in paragraph (2) of this subsection. The fees authorized by
this paragraph shall, as nearly as practicable, cover the costs of the
service incident to performance of its functions related to weighing,
including administrative and supervisory costs directly related
95 STAT. 372 PUBLIC LAW 97-35—AUG. 13, 1981
thereto. Such fees shall be deposited into the fund created in section
7(j) of this Act.
"(2) Each agency to which authority has been delegated under this
section and each agency or other person which has been designated to
perform functions related to weighing under this section shall pay to
the Administrator fees in such amount as the Administrator deter-
mines fair and reasonable and as will cover the costs incurred by the
Service relating to supervision of the agency personnel and supervi-
sion by Service personnel of its field office personnel incurred as a
result of the functions performed by such agencies, except costs
7 u s e 79, 85, 86 incurred under sections 7(gX3), 9,10, and 14 of this Act. The fees shall
87c. be payable after the services are performed at such times as specified
by the Administrator and shall be deposited in the fund created in
Overdue section 7(j) of this Act. Failure to pay the fee within thirty dajrs after
fees. it is due shall result in automatic termination of the delegation or
designation, which shall be reinstated upon pa3mient, within such
period as specified by the Administrator, of the fee currently due plus
interest and any further expenses incurred by the Service because of
Interest such termination. The interest rate on overdue fees shall be as
rate. prescribed by the Secretary, but not less than the current average
market jdeld on outstanding marketable obligations of the United
States of comparable maturity, plus an additional charge of not to
exceed 1 per centum per annum as determined by the Secretary, and
adjusted to the nearest one-eighth of 1 per centum.";
(3) adding a new section 7C as follows:
LIMITATION ON ADMINISTRATIVE AND SURPERVISORY COSTS
7 use 79c. "SEC. 7C. The total administrative and supervisory costs which
may be incurred under this Act for inspection and weighing (exclud-
ing standardization, compliance, and foreign monitoring activities)
for each of the fiscal years 1982 through 1984 shall not exceed 35 per
centum of the total costs for such activities carried out by the Service
for such year.";
(4) amending section 19 (7 U.S.C. 87h) to read as follows:
APPROPRIATIONS
"SEC. 19. There are hereby authorized to be appropriated such
sums as are necessary for standardization and compliance activities,
monitoring in foreign ports grain officially in^)ected and weighed
under this Act, and any other expenses necessary to carry out the
provisions of this Act for each of the fiscal years during the period
beginning October 1, 1981, and ending September 30, 1984, to the
extent that financing is not obtained from fees and sales of samples as
7 u s e 79, 79a, provided for in sections 7,7A, and 17A of this Act."; and
87f-l. (5) adding a new section 20 as follows:
ADVISORY COMMITTEE
Establishment. "SEC. 20. (a) In order to assure the normal movement of grain in an
7 use 87i. orderly and timely manner, the Secretary shall establish an advisory
committee to provide advice to the Administrator with respect to the
efficient and economical implementation of the United States Grain
7 u s e 71 note. Standards Act of 1976. The advisory committee shall consist of not
more than twelve members, appointed bj^ the Secretary, representing
the interests of all segments of the grain industry, including grain
inspection and weighing agencies. Members of the advisory commit-
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 373
tee shall be appointed not later than thirty days after the date of
enactment of this section.
"0)) The advisory committee shall be governed by the provisions of
the Federal Advisory Committee Act. 5 use app.
"(c) The Administrator shall provide the advisory committee with
necessary clerical assistance and staff personnel.
"(d) Members of the advisory committee shall serve without com-
pensation, if not otherwise officers or employees of the United States,
except that members shall, while away from their homes or regular
places of business in the performance of services under this Act, be
allowed travel expenses, including per diem in lieu of subsistence, as
authorized under section 5703 of title 5, United States Code.".
COTTON CLASSING AND RELATED SERVICES
SEC. 156. (a) Section 5 of the United States Cotton Standards Act (7
U.S.C. 55) is amended to read as follows:
"SEC. 5. (a) The Secretary of Agriculture shall cause to be collected Fees and
such fees and charges for licenses issued to classifiers of cotton under charges.
section 3 of this Act, for determinations made under section 4 of this ^ use 53, 54.
Act, and for the establishment of standards and sale of copies of
standards under section 6 of this Act, as will cover, as nearly as 7 use 56, 57,
practicable, and after taking into consideration net proceeds from ^^^
any sale of samples, the costs incident to providing services and
standards under such sections, including administrative and supervi-
sory costs. Such fees and charges shall be credited to the current
appropriation account that incurs the cost and shall remain available
until expended to pay the expenses of the Secretary incident to
providing services and standards under this Act and the United
States Cotton Futures Act (7 U.S.C. 15b). The Secretary may provide
by regulation conditions under which cotton samples submitted or
used in the performance of services authorized by this Act shall
become the property of the United States and may be sold with the
proceeds credited to the foregoing account: Provided, That such
cotton samples shall not be subject to the provisions of the Federal
Property and Administrative Services Act of 1949 (40 U.S.C. 471 et
seq.).
(b) The price established by the Secretary of Agriculture under the
foregoing provisions of this section for practical forms representing
the official cotton standards of the United States shall cover, as
nearly as practicable, the estimated actual cost to the Department of
Agriculture for developing and preparing such practical forms.".
(b) Effective only for the fiscal years ending September 30, 1982,
September 30,1983, and September 30,1984, section 3a of the Cotton
Statistics and Estimates Act (7 U.S.C. 473a) is amended to read as
follows:
"SEC. 3a. Effective for the fiscal years ending September 30,1982,
September 30,1983, and September 30,1984, the Secretary of Agricul-
ture shall make cotton classification services available to producers
of cotton. The Secretary shall further provide for appropriate agen-
cies of the Department of Agriculture to collect directly from partici-
pating producers reasonable fees which, together with the proceeds of
sales of samples submitted under this section, shall cover as nearly as
practicable the cost of the services provided under this section,
including administrative and supervisory costs: Provided, That the
Secretary's net cost estimate (after taking into account the proceeds
from the sale of samples) used to calculate the uniform per-bale fee to
be collected from producers for such classification services shall not
95 STAT. 374 PUBLIC LAW 97-35—AUG. 13, 1981
exceed $12,000,000 in the fiscal year ending September 30, 1982,
$12,400,000 in the fiscal year ending September 30, 1983, and
$13,000,000 in the fiscal year ending September 30,1984. All samples
of cotton submitted for classification under this section shall become
the property of the United States, and shall be sold: Provided, That
such cotton samples shall not be suWect to the provisions of the
Federal Property and Administrative Services Act of 1949 (40 U.S.C.
471 et seq.). Fees collected under this section and under section 3d of
this Act and proceeds from sales of samples shall be credited to the
current appropriation account that incurs the cost and shall remain
available without fiscal year limitation to pay the expenses of the
Secretary incident to providing classification services under this
section. The Secretary may deposit such funds in an interest bearing
account with a financial institution. If any interest is earned on this
account, such interest so earned shall be credited to the account for
Appropriation use by the Secretary in providing such services. There are authorized
authorization. to be appropriated such sums as may be necessary to carry out the
provisions of this section to the extent that financing is not available
from fees and the proceeds from the sale of samples.".
(c) Subsection (f)(1)(G) of the United States Cotton Futures Act (7
U.S.C. 15b(f)(l)(G)) is amended by striking out "in such regulations."
and inserting in lieu thereof "in such regulations and shall be
credited to the account referred to in section 5 of the United States
Ante, p. 373. Cotton Standards Act (7 U.S.C. 55). The Secretary may provide by
regulation conditions under which cotton samples submitted or used
in the performance of services authorized by this act shall become the
property of the United States and may be sold and the proceeds
credited to the foregoing account: Provided, That such cotton samples
shall not be subject to the provisions of the Federal Property and
Administrative Services Act of 1949 (40 U.S.C. 471 et seq.).".
Meetings. (d) The Secretary of Agriculture shall hold annual meetings with
7 u s e 61a. representatives of the cotton industry to review (1) activities and
7 use 51, operations under the Cotton Standards Act, and the Cotton Statistics
471 note. and Estimates Act, (2) activities and operations relating to cotton
7 u s e 241. under the United States Warehouse Act, and (3) the effect of such
activities and operations on prices received by producers and sales to
domestic and foreign users, for the purpose of improving procedures
for financing and administering such activities and operations for the
benefit of the industry and the Government. Notwithstanding any
other provision of law, the Secretary shall take such action as may be
necessary to insure that the universal cotton standards system and
the licensing and inspection procedures for cotton warehouses are
preserved and that the Government cotton classification system
continues to operate so that the United States cotton crop is provided
an official quality description.
Effective (e) The provisions of this section shall become effective October 1,
date. 1981.
7 u s e 61a note. TOBACCO INSPECTION AND RELATED SERVICES
SEC. 157. (a) The Tobacco Inspection Act is amended by—
Fees and (1) in section 5 (7 U.S.C. 51 Id), striking out the last two
charges. sentences and inserting in lieu thereof the following: "The
Secretary shall by regulation fix and collect fees and charges for
inspection and certification, the establishment of standards, and
other services under this section at designated auction markets.
The fees and charges authorized by this section shall, as nearly
as practicable, cover the costs of the services, including the
administrative and supervisory costs customarily included by the
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 375
Secretary in user fee calculations. The fees and charges, when
collected, shall be credited to the current appropriation account
that incurs the cost and shall be available without fiscal year
limitation to pay the expenses of the Secretary incident to
providing services under this Act, Such fees and charges shall be
assessed against the warehouse operator, irrespective of owner-
ship or interest in the tobacco, and shall be collected by the
warehouse operator from the sellers of the tobacco. The inspec-
tion and related services under this section shall be suspended or
denied if the warehouse operator fails to collect or otherwise pay
the fees and charges imposed under this section. Tobacco inspec-
tion or certification services provided to designated auction
markets shall take precedence over such services, other than
reinspection, requested under the authority contained in section
6 of this Act or any other provision of law. In accordance with the
Federal Advisory Committee Act, the Secretary shall establish a 5 use app
national advisory committee of tobacco producers, and advisory
subcommittees for each major kind of tobacco, to advise the
Secretary with regard to the level of inspection and related
services and the fees and charges therefor. The advisory commit-
tee and subcommittees established under this section shall be of
permanent duration. The committees shall meet at the call of the
Secretary."; and
(2) in section 6 (7 U.S.C. 51 le), amending the first sentence of
the second paragraph as follows: "The Secretary shall fix and
collect such fees or charges in the administration of this section
as will cover, as nearly as practicable, the costs of the services
provided, including administrative and supervisory costs. Such
fees and charges shall be credited to the account referred to in
section 5 of this Act.". 5 use Slid.
GD) The provisions of this section shall become effective October 1, Effective
1981. date.
WAREHOUSE EXAMINATION, INSPECTION, AND UCENSING 7 u s e 51 Id note.
SEC. 158. (a) The United States Warehouse Act is amended by—
(1) amending section 10 (7 U.S.C. 251) to read as follows:
"SEC. 10. The Secretary of Agriculture, or the Secretary's designat- Fees, collection.
ed representative, shall charge, assess, and cause to be collected a
reasonable fee for (1) each examination or inspection of a warehouse
(including the physical facilities and records thereof and the agricul-
tural products therein) under this Act; (2) each license issued to any
person to classify, inspect, grade, sample, or weigh agricultural
products stored or to be stored under provisions of this Act; (3) each
annual warehouse license issued to a warehouseman to conduct a
warehouse under this Act; and (4) each warehouse license amended,
modified, extended, or reinstated under this Act. Such fees shall
cover, as nearly as practicable, the costs of providing such services
and licenses, including administrative and supervisory costs: Pro-
vided, That the amount of such fees collected for cotton warehouse
inspections shall not exceed $400,000 in the fiscal year ending
September 30,1982, $415,000 in the fiscal year ending September 30,
1983, and $430,000 in the fiscal year ending September 30, 1984. All
fees collected shall be credited to the current appropriation account
that incurs the costs and shall be available without fiscal year
limitation to pay the expenses of the Secretary incident to providing
services under this Act. The Secretary may deposit such funds in an
interest bearing account with a financial institution. If any interest is
9-194 0 - 8 2 26:QL3
95 STAT. 376 PUBLIC LAW 97-35—AUG. 13, 1981
earned on this account such interest shall be credited to the account
for use by the Secretary in providing such services."; and
(2) amending section 31 (7 U.S.C. 271) to read as follows:
Appropriation "SEC. 31. There are hereby authorized to be appropriated such
authorization.
sums as are necessary to carry out the provisions of this Act other
than those services for which fees are authorized pursuant to section
10. Such appropriated funds may be used by the Secretary to employ
qualified persons not regularly in the service of the United States for
temporary assistance in carrying out the provisions of this Act.".
Effective date. (b) The provisions of this section shall become effective October 1,
7 u s e 251 note. 1981.
NAVAL STORES INSPECTION AND RELATED SERVICES
SEC. 159. (a) The Naval Stores Act is amended by—
(1) in the second sentence of section 4 (7 U.S.C. 94) striking out
"on tender of the cost thereof as required by him,"; and
(2) amending section 8 (7 U.S.C. 98) to read as follows:
Fees and "SEC. 8. (a) The Secretary of Agriculture shall fix and cause to be
charges. collected fees and charges for the establishment of standards under
7 use 93. section 3 of this Act and for examinations, analyses, classifications,
and other services under section 4 of this Act which shall cover, as
nearly as practicable, the costs of providing such services and
standards as the Secretary shall deem necessary, including adminis-
trative and supervisory costs. Such fees and charges, when collected,
shall be credited to the current appropriation account that incurs
such costs and shall be available without fiscal year limitation to pay
the expenses of the Secretary incident to providing such services and
standards under this Act. Fees and charges shall be assessed and
collected from processors and warehousers of naval stores, and
inspection and related services shall be suspended or denied to any
such processor or warehouser upon failure to timely pay the fees and
charges assessed.
Appropriation "(b) There are hereby authorized to be appropriated such sums as
authorization. may be necessary for the enforcement and administration of this
Act.".
Effective date. (b) The provisions of this section shall become effective October 1,
7 u s e 94 note. 1981.
PART 3—FARMERS HOME ADMINISTRATION PROGRAMS
INTEREST RATES ON FARMERS HOME ADMINISTRATION WATER AND
WASTE DISPOSAL AND COMMUNITY FACIUTY LOANS, LOANS TO LOW-
INCOME UMITED RESOURCE BORROWERS, AND LOANS FOR NONFARM
FACIUTIES ON PRIME FARMLANDS
SEC 160. (a) Section 307(a) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1927(a)) is amended bv—
(1) in paragraph (2), striking out "and (5) and inserting in lieu
thereof ^'(5), and (6)";
(2) in paragraph (4), striking out "The" and inserting in lieu
thereof Except as provided in paragraph (6), the";
(3) amending paragraph (3) to read as follows:
"(3)(A) Except as provided in paragraph (6), the interest rates on
loans (other than guranteed loans), to public bodies or nonprofit
associations (inclu(Cng Indian tribes on Federal and State reserva-
tions and other federally recognized Indian tribal groups) for water
and waste disposal facilities and essential community facilities shall
be set by the Secretary at rates not to exceed the current market 3rield
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 377
for outstdnding municipal obligations with remaining periods to
maturity comparable to the average maturity for such loans, and
adjusted to the nearest one-eighth of 1 per centum; and not in excess
of 5 per centum per annum for any such loans which are for the
upgrading of existing facilities or construction of new facilities as
required to meet applicable health or sanitary standards in areas
where the median family income of the persons to be served by such
facility is below the poverty line prescribed by the Office of Manage-
ment and Budget as adjusted under section 624 of the Economic
Opportunity Act of 1964 (42 U.S.C 2971d) and in other areas as the
Secretary may designate where a significant percentage of the
persons to be served by such facilities are of low income, as deter-
mined by the Secretary.
"(B) Except as provided in paragraph (6), the interest rates on loans
(other than guaranteed loans) under section 310D of this title shall be '7 USC 1934.
as determined by the Secretary, but not in excess of one-half of the
current average market yield on outstanding marketable obligations
of the United States with remaining periods to maturity comparable
to the average maturities of such loans, nor less than 5 per centum
per annum."; and
(4) adding at the end thereof a new paragraph (6) as follows:
"(6XA) Notwithstanding any other provision of this section, in the
case of loans (other than guaranteed loans) made or insured under
the authorities of this Act specified in subparagraph (B) for activities
that involve the use of prime farmland as defined in subparagraph
(C), the interest rates shall be the interest rates otherwise applicable
under this section increased by 2 per centum per annum. Wherever
practicable, construction by a State, municipality, or other political
subdivision of local government that is supported by loans described
in the preceding sentence shall be placed on land that is not prime
farmland, in order to preserve the maximum practicable amount of
prime farmlands for production of food and fiber. Where other
options exist for the siting of such construction and where the
governmental authority still desires to carry out such construction on
prime farmland, the 2 per centum interest rate incregise provided by
this clause shall apply, but such increased interest rate shall not
apply where such other options do not exist.
"(B) The authorities referred to in subparagraph (A) are—
"(i) clauses (2) and (3) of section 303(a), 7 use 1923.
"(ii) the provisions of section 304(a) relating to the financing of '^ use 1924.
outdoor recreational enterprises or the conversion of farming or
rsmching operations to recreational uses,
"(iii) section 304(b),
"(iv) the provisions of section 306(aXl) relating to loans for '^ use 1926.
recreational developments and essential community facilities,
"(v) section 306(aX15),
"(vi) clause (1) of section 310B(a), 7 use 1932.
"(vii) subsections (d) and (e) of section 310B, and
"(viii) section 310D(a) as it relates to the making or insuring of 7 use 1934.
loans under clauses (2) and (3) of section 303(a).
"(C) For purposes of this paragraph, the term 'prime farmland' "Prime
means prime farmlands and unique farmland as those terms are farmland."
defined in sections 657.5 (a) and (b) of title 7, Code of Federal
Regulations (1980).".
(b) Section 316(a) of the Consolidated Farm and Rural Development
Act (7 U.S.C. 1946(a)) is amended by—
(1) inserting "(1)" after "(a)";
95 STAT. 378 PUBLIC LAW 97-35—AUG. 13, 1981
(2) inserting in the second sentence "and loans as provided in
paragraphs (2) and (3)" after "except for guaranteed loans"; and
(3) adding at the end thereof new paragraphs (2) and (3) as
follows:
"(2) The interest rate on any loan (other than a guaranteed loan) to
a low-income, limited resource borrower under this subtitle shall be
the interest rate otherwise applicable under this section reduced by 3
per centum per annum.
"(3) The interest rate on any loan (other than a guaranteed loan)
7 u s e 1942. made or insured under clause (5) of section 312(a) for activities that
Ante, p. 376. involve the use of prime farmland as defined in section 307(aX6XC)
shall be the interest rate otherwise applicable under this section
increased by 2 per centum per annum.".
Effective date. (c) The amendments made by this section shall apply to loans
7USC 1927 note. approved after September 30,1981.
EMERGENCY LOAN AMOUNTS
SEC. 161. Section 321(a) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1961(a)) is amended by inserting "only to
the extent and in such amounts as provided in advance in appropri-
ation Acts" after "The Secretary shall make and insure loans under
this subtitle".
INTEREST RATES ON EMERGENCY LOANS FOR ACTUAL LOSS
SEC. 162. (a) Section 324(b)(1) of the Consolidated Farm and Rural
Development Act (7 U.S.C. 1964(bXl)) is amended to read as follows:
"(1) For loans or portions of loans up to the amount of the
applicant's actual loss caused by the disaster, as limited under
subsection (aXD of this section, the interest shall be at rates pre-
scribed by the Secretary, but (A) if the applicant is not able to obtain
sufficient credit elsewhere, not in excess of 8 per centum per annum,
and (B) if the applicant is able to obtain sufficient credit elsewhere,
not in excess of the rate prevailing in the private market for similar
loans, as determined by the Secretary; and".
Effective date. (b) The amendments made by this section shall apply to loans made
7 u s e 1964 note. with respect to disasters occurring after September 30,1981.
ELIGIBILITY FOR ASSISTANCE BASED ON PRODUCTION LOSS
SEC. 163. Section 329 of the Consolidated Farm and Rural Develop-
7 use 1970. ment Act is amended to read as follows:
"SEC. 329. The Secretary shall make financial assistance under this
subtitle available to any applicant seeking assistance based on
production losses if the applicant shows that a single enterprise
which constitutes a basic part of the applicant's farming, ranching, or
aquaculture operation has sustained at least a 30 per centum loss of
normal per acre or per animal production, or such lesser per centum
of loss as the Secretary may determine, as a result of the disaster
based upon the average monthly price in effect for the previous year
and the applicant otherwise meets the conditions of eligibility pre-
scribed under this subtitle. Such loans shall be made available based
upon 80 per centum, or such greater per centum as the Secretary may
determine, of the total calculated actual production loss sustained by
the applicant.".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 379
INSURED LOAN UMITS
SEC. 164. Section 346 of the Consolidated Farm and Rural Develop-
ment Act (7 U.S.C. 1994) is amended by adding at the end thereof a
new subsection (d) as follows:
"(d) Notwithstanding any contrary provisions of subsection (b) of
this section, for fiscal year 1982, loans are authorized to be insured, or
made to be sold and insured, as follows:
"(1) From the Agricultural Credit Insurance Fund—
"(A) insured real estate loans for farm ownership pur-
poses, $700,000,000, and
"(B) insured operatmg loans, $1,325,000,000.
Not less than 20 per centum of the insured loans authorized for
farm ownership purposes and not less that 20 per centum of the
insured loans authorized for farm operating purposes shall be for
low-income, limited-resource applicants.
"(2) From the Rural Development Insurance Fund—
"(A) insured water and waste disposal loans, $300,000,000,
and
"(B) insured community facility loans, $130,000,000.".
PART 4—RURAL ELECTRIFICATION ADMINISTRATION
PROGRAMS
RURAL ELECTRIFICATION ACT AMENDMENTS
SEC. 165. (a) Section 305(b) of the Rural Electrification Act of 1936 (7
U.S.C. 935(b)) is amended to read as follows:
"(b) Insured loans made under this title shall bear interest at 5 per insured loans,
centum per annum, except that the Administrator may make insured interest rates.
loans to electric or telephone borrowers at a lesser interest rate, but
not less than 2 per centum per annum, if, in the Administrator's sole
discretion, the Administrator finds that the borrower—
"(1) has experienced extreme financial hardship; or
"(2) cannot, in accordance with generally accepted manage-
ment and accounting principles and without charging rates to its
customers or subscribers so high as to create a substantial
disparity between such rates and the rates charged for similar
service in the same or nearby areas by other suppliers, provide
service consistent with the objectives of this Act.".
(b) Section 306 of the Rural Electrification Act of 1936 (7 U.S.C. 936)
is amended by—
(1) inserting immediately after the second sentence the follow-
ing: "With respect to guarantees issued by the Administrator
under this section, on the request of the borrower of any such
loan so guaranteed, the loan shall be made by the Federal
FiuEuicing Bank and at a rate of interest that is not more than
the rate of interest applicable to other similar loans then being
made or purchsised by the Bank."; and
(2) striking our "a loan insured at the standard rate" in the
fourth sentence and inserting in lieu thereof "an insured loan".
(c) Section 307 of the Rural Electrification Act of 1936 (7 U.S.C. 937)
is amended by striking out "a loan insured at the standard rate" and
inserting in lieu thereof "an insured loan".
(d) The amendments made by subsection (a) of this section shall 7 use 935 note
apply to loans the applications for which are received by the Rural
Electrification Administration after July 24,1981.
95 STAT. 380 PUBLIC LAW 97-35—AUG. 13, 1981
TITLE II—ARMED SERVICES AND
DEFENSE-RELATED PROGRAMS
Subtitle A—Strategic and Critical Materials
AUTHORIZATION OF DISPOSALS
Effective date. SEC. 201. (a) Effective on October 1,1981, the President is author-
7 u s e 98d note. ized to dispose of the following quantities of materials currently held
in the National Defense Stockpile established by section 3 of the
Strategic and Critical Materials Stock Piling Act (50 U.S.C. 98b), such
quantities having been determined to be excess to the current
requirements of the stockpile:
(1) 1,000,000 pounds of iodine.
(2) 1,500,000 carats of diamonds, industrial crushing bort.
(3) 710,253 pounds of mercuric oxide.
(4) 50,000 flasks of mercury.
(5) 6,000,000 pounds of mica, muscovite splittings.
(6) 25,000 pounds of mica, phlogopite splittings.
(7) 46,537,000 troy ounces of silver.
(8) 1,000 short tons of antimony.
(9) 2,000 short tons of asbestos chrysotile.
(10) 50,000 pounds of mica muscovite film, first and second
qualities.
(11) 50,000 pounds of mica muscovite block, stained and lower.
(12) 700 long tons of vegetable tannin extract, wattle.
Effective date. (b) Effective on October 1, 1982, the President is authorized to
dispose of the foUowii^ quantities of materials currently held in the
National Defense Stockpile, such quantities having been determined
to be excess to the current requirements of the stockpile:
(1) 44,682,000 troy ounces of silver.
(2) 1,()00 short tons of antimony.
(3) 2,000 short tons of asbestos chrysotile.
(4) 1,500,000 carats of diamond stones.
(5) 1,000,000 pounds of iodine.
(6) 50,000 pounds of mica muscovite film, first and second
qualities.
(7) 50,000 pounds of mica muscovite block, stained and lower.
(8) 697 long tons of vegetable teinnin extract, wattle.
Effective date. (c) Effective on October 1, 1983, the President is authorized to
dispose of the following quantities of materials currently held in the
National Defense Stockpile, such quantities having been determined
to be excess to the current requirements of the stockpile:
(1) 13,900,000 troy ounces of silver.
(2) 1,000 short tons of antimony.
(3) 6,000 short tons of asbestos amosite.
(4) 2,000 short tons of asbestos chrysotile.
(5) 1,500,000 carats of diamond stones.
(6) 197,465 carats of diamonds, industrial crushing bort.
(7) 213,000 pounds of iodine.
(8) 50,000 poimds of mica muscovite film, first and second
qualities.
(9) 50,000 pounds of mica muscovite block, stained and lower.
Expiration. (dXD The authority to enter into contracts for the disposal of
materials in the stockpile under the disposal authorizations con-
tained in paragraphs (7) through (12) of subsection (a) eiq;>ires on
September 30,1982.
PUBLIC LAW 97-35-AUG. 13,1981 95 STAT. 381
(2) The. authority to enter into contracts for the disposal of materi- Expiration.
als in the stockpue under the disposal authorizations contained in
subsection (b) expires on September 30,1983.
(3) The authori^ to enter into contracts for the disposal of materi- Expiration.
als in the stockpue under the disposal authorizations contained in
subsection (c) expires on September 30,1984.
(e) Any disposal under the authority of subsection (a), (b), or (c) shall'
be carried out in accordance with the provisions of the S t r a t ^ c and
Critical Materials Stock Piling Act (50 U.S.C. 98 et seq.).
(fKD The authority contained in subsections (bXD and (cXD shall
not become effective unless the President, not later than September
1, 1982, determines that the silver authorized for disposal oy such
subsections is excess to the requirements of the stockpile as of that
date.
(2) A determination by the President under paragraph (1) shall be
based upon consideration of such factors as the President considers
relevant, including the following factors:
(A) The demand for silver in each of the next ten years for the
industrial, military, and naval needs of the United States for
national defense.
(B) The domestic supply of silver for each of the next ten years,
as a function of price, that would be available to meet the
demand identified under subparagraph (A).
(C) The potential dependency of the United States on foreign
supplies of silver in each of the next ten years to meet the
demand identified under subparagraph (A).
(D) The effect of disposal under subsections (bXD and (cXD on (i)
the world silver market (in terms of price and supply), (ii) the
domestic and international silver mining industry (in terms of
exploration and production), (iii) international currency and
monetary policy, and (iv) long range military preparedness.
(3) If the President makes a determination described in paragraph Report to
(1), he shall promptly report to the Committees on Armed Services of congressional
the Senate and House of Representatives that he has made such committees.
determination and shall include a detailed discussion and analysis of
the factors set forth in paragraph (2) and other relevant factors.
AUTHORIZATION OP APPROPRIATIONS
SEC. 202. (a) Effective on October 1,1981, there is authorized to be so use 98d note.
appropriated the sum of $535,000,000 for the acquisition of strategic
and critical materials under section 6(a) of the Strategic and Critical
Materials Stock Piling Act (50 U.S.C. 98e(a)).
(b) Any acquisition using funds appropriated under the authoriza-
tion of subsection (a) shall be carried out in accordance with the
provisions of the Strategic and Critical Materials Stock Piling Act (50
lJ.S.C.98etseq.).
IMPROVEMENTS IN STOCKPILE MANAGEMENT
SEC. 203. (a) Section 5(a) of the Strategic and Critical Materials
Stock Piling Act (50 U.S.C. 98d(a)) is amended—
(1) by inserting "(1)" after "(a)";
(2) by inserting "and other incidental expenses" after "trans-
portation";
(3) by striking out "for a period of five fiscal years, if so
provided in appropriation Acts" and inserting in lieu thereof
95 STAT. 382 PUBLIC LAW 97-35—AUG. 13, 1981
"until expended, unless otherwise provided in appropriation
Acts"; and
(4) by adding at the end thereof the following new paragraph:
"(2) If for any fiscal year the President proposes certain stockpile
transactions in the annual materials plan submitted to Congress for
50 u s e 98h-2. that year under section 11(b) and after that plan is submitted the
President proposes (or Congress requires) a significant change in any
such transaction, or a significant transaction not included in such
plan, no amount may be obligated or expended for such transaction
during such year until the President has submitted a full statement
of the proposed transaction to the appropriate committees of Con-
gress and a period of 30 days has passed from the date of the receipt of
such statement by such committees or until each such committee,
before the expiration of such period, notifies the President that it has
no objection to the proposed transaction. In computing any 30-day
period for the purpose of the preceding sentence, there shall be
excluded any day on which either House of Congress is not in session
because of an adjournment of more than three days to a day certain.".
(b) Section 5(b) of such Act (50 U.S.C. 98d(b)) is amended—
(1) by inserting "(1)" after "from the stockpile"; and
(2) by striking out the period at the end and inserting in lieu
thereof ", or (2) if the disposal would result in there being a
balance in the National Defense Stockpile Transaction Fund in
excess of $1,000,000,000 or, in the case of a disposal to be made
after September 30, 1983, if the disposal would result in there
being a balance in the fund in excess of $500,000,000.".
(c) Section 6(a)(6) of such Act (50 U.S.C. 98e(a)(6)) is amended by
inserting "subject to the provisions of section 5(b)," after "(6)".
(dXD Section 9(bXl) of such Act (50 U.S.C. 98h(bXl)) is amended by
striking out "or until" and all that follows in such section and
inserting in lieu thereof a period.
(2) Section 9(bX3) of such Act (50 U.S.C. 98h(bX3)) is amended to
read as follows:
"(3) Moneys in the fund, when appropriated, shall remain available
until expended, unless otherwise provided in appropriation Acts.".
(e) Section 11 of such Act (50 U.S.C. 98h-2) is amended—
(1) by inserting "(a)" after "SEC. 11."; and
(2) by adding at the end thereof the following new subsection:
Report to "(b) The President shall submit to the appropriate committees of
congressional
committees. the Congress each year with the Budget submitted to Congress
pursuant to section 201(a) of the Budget and Accounting Act, 1921 (31
U.S.C. 11(a)), for the next fiscal year a report containing an annual
materials plan for the operation of the stockpile during such fiscal
year and the succeeding four fiscal years. Each such report shall
include details of planned expenditures for acquisition of strategic
and critical materials during such period (including expenditures to
be made from appropriations from the general fund of the Treasury)
and of anticipated receipts from proposed disposals of stockpile
materials during such period.".
Effective date. (f) The amendments made by subsection (a) shall apply with respect
50 u s e 98d note.
to funds appropriated for fiscal years beginning after September 30,
1981.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 383
Subtitle B—Military Compensation
ONCE ANNUAL COST-OF-LIVING INCREASES IN MILITARY RETIRED PAY
SEC. 211. (a) For cost savings achieved through elimination of one of
the present semiannual increases in military retired and retainer
pay, contingent upon a similar change in law being made with respect
to the ci^dl service retirement system, see section 812(b) of the
Department of Defense Authorization Act, 1981 (Public Law 96-342;
94 Stat. 1098). 10 u s e 1401a
(b) Section 812(bXl) of the Department of Defense Authorization note.
Act, 1981, is amended by striking out "subject to paragraph (3)" and
inserting in lieu thereof "subject to paragraph (2)".
OPEN ENROLLMENT PERIOD FOR SURVIVOR BENEFIT PLAN
SEC. 212. (aXD Any eligible member who on the date of the 10 u s e 1448
enactment of this Act is not a participant in the Survivor Benefit note.
Plan may elect to participate in the Plan during the open enrollment
period specified in subsection (b).
(2) Any eligible member who on the date of the enactment of this
Act is a participant in the Plan but elected not to participate in the
Plan at the maximum level or (in the case of an eligible member who
is married) elected to provide an annuity under the Plan for a
dependent child and not for the member's spouse may during the
open enrollment period elect to participate in the Plan at a higher
level or to provide an annuity under the Plan for the eligible
member's spouse at a level not less than the level provided for the
dependent child.
(3) Any such election shall be made in the same manner as an
election under section 1448 of such title and shall be effective when
received by the Secretary concerned. Notwithstanding the last sen-
tence of section 1452(a) of such title, the reduction in retired or
retainer pay prescribed by the first sentence of such section shall, in
the case of an individual making an election under paragraph (1),
begin on the first day of the first month beginning after such election
is effective.
(b) The open enrollment period is the period beginning on October
1,1981, and ending on September 30,1982.
(c) If an individual making an election under subsection (a) dies
before the end of the two-year period beginning on the date of that
election, the election is void and the amount of any reduction in the
retired or retainer pay of such individual that is attributable to the
election shall be paid in a lump sum to that individual's beneficiary
under the Plan (as designated under that election).
(d) Sections 1449,1453, and 1454 of title 10, United States Code, are
applicable to individuals making elections and to elections under this
section.
(e) For the purposes of this section: Definitions.
(1) The term "eligible member" means a member or former
member of the uniformed services who on the date of the
enactment of this Act is entitled to retired or retainer pay.
(2) The term "Survivor Benefit Plan" or "Plan" means the
program established under subchapter II of chapter 73 of title 10,
United States Code. 10 u s e 1447.
(3) The term "Secretary concerned" has the meaning given
such term in section 101(5) of title 37, United States Code.
95 STAT. 384 PUBLIC LAW 97-35—AUG. 13, 1981
TITLE III—BANKING, HOUSING, AND
RELATED PROGRAMS
Housing and Subtitle A—Housing and Community Development
Community
Development
Amendments of SHORT TITLE
1981.
42 u s e 5301 SEC. 300. This subtitle may be cited as the "Housing and Communi-
note. ty Development Amendments of 1981".
PART 1—COMMUNITY AND ECONOMIC DEVELOPMENT
AUTHORIZATIONS
SEC. 301. Section 103 of the Housing and Community Development
42 u s e 5303. Act of 1974 is amended to read as follows:
AUTHORIZATIONS
Grants. "SEC. 103. The Secretary is authorized to make grants to States,
units of general local government, and Indian tribes to carry out
Appropriation. activities in accordance with the provisions of this title. There are
authorized to be appropriated for these purposes not to exceed
$4,166,000,000 for each of the fiscal years 1982 and 1983. Sums
appropriated pursuant to this section shall remain available until
expended.".
S T A T E M E N T O P ACTIVITIES AND REVIEW
SEC. 302. (a) The caption of section 104 of the Housing and
42 u s e 5304. Community Development Act of 1974 is amended to read as follows:
"STATEMENT OF ACTIVITIES AND REVIEW".
(b) Subsections (a), (b), and (c) of section 104 of such Act are
amended to read as follows:
"(aXl) Prior to the receipt in any fiscal year of a grant under section
42 u s e 5306; 10603) by any metropolitan city or urban county, under section 106(d)
Post p. 389. by any State, or under section 106(dX2XB) by any unit of general local
government, the grantee shall have prepared a final statement of
community development objectives and projected use of funds and
shall have provided the Secretary with the certifications required in
subsection 0)) and, where appropriate, subsection (c). In the case of
metropolitan cities and urban counties receiving grants pursuant to
section 1060t)) and in the case of units of general local government
receiving grants pursuant to section 106(dX2XB), the statement of
projected use of funds shall consist of proposed community develop-
ment activities. In the case of States receiving grants pursuant to
section 106(d), the statement of projected use of funds shall consist of
the method by which the States will distribute funds to units of
general local government.
"(2) In order to permit public examination and appraisal of such
statements, to enhance the public accountability of grantees, and to
facilitate coordination of activities with different levels of govern-
ment, the grantee shall—
"(A) furnish citizens information concerning the amount of
funds available for proposed community development and hous-
ing activities and the range of activities that may be undertaken;
"(B) publish a proposed statement in such manner to afford
affected citizens or, as appropriate, units of general local govern-
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 385
ment an opportunity to examine its content and to submit
comments on the proposed statement and on the community
development performance of the grantee; and
"(C) hold one or more public hearings to obtain the views of
citizens on community development and housing needs.
In preparing the final statement, the grantee shall consider any such,
comments and views and may, if deemed appropriate by the grantee,
modify the proposed statement. The final statement shall be made
available to the public, and a copy shall be furnished to the Secretary
together with the certifications required under subsection (b) and,
where appropriate, subsection (c).
"(b) Any grant under section 106 shall be made only if the grantee 42 use 5306
certifies to the satisfaction of the Secretary that—
"(1) the grantee is in full compliance with the requirements of
subsection (aX2) (A), (B), and (C) and has made the final statement
available to the public;
"(2) the grant will be conducted and administered in conform-
ity with Public Law 88-352 and Public Law 90-284; 42 u s e 2000a
"(3) the projected use of funds has been developed so as to give note; 82 Stat. 73.
Projected use of
maximum feasible priority to activities which will benefit low- funds.
and moderate-income families or aid in the prevention or elimi-
nation of slums or blight; the projected use of funds may also
include activities which the grantee certifies are designed to
meet other community development needs having a particular
urgency because existing conditions pose a serious and immedi-
ate threat to the health or welfare of the community where other
financigd resources are not available to meet such needs; and
"(4) the grantee will comply with the other provisions of this
title and with other applicable laws.
"(cXD Any grant made under section 1060i)) shall be made only if Grants.
the unit of general local government certifies that it is following a
current housing assistance plan which has been approved by the
Secretary and which—
"(A) accurately surveys the condition of the housing stock in
the community and assesses the housing assistance needs of
lower income persons (including elderly and handicapped per-
sons, large families, owners of homes requiring rehabilitation
assistance, and persons displaced or to be displaced) residing in
or expected to reside in the community as a result of existing or
projected changes in employment opportunities and population
in the community (and those elderly persons residing in or
expected to reside in the community), or as estimated in a
community accepted State or regional housing opportunity plan
approved by the Secretary, and identifies housing stock which is
in a deteriorated condition, including the impact of conversion of
rental housing to condominium or cooperative ownership on
such needs;
"(B) specifies a realistic annual goal for the number of dwelling
units or lower income persons to be assisted, including (i) the
relative proportion of new, rehabilitated, and existing dwelling
units, including existing rental and owner occupied dwelling
units to be upgraded and thereby preserved, (ii) the sizes and
types of housing projects and assistance best suited to the needs
of lower income persons in the community, and (iii) in the case of
subsidized rehabilitation, adequate provisions to assure that a
preponderance of persons assisted should be of low and moderate
income; and
95 STAT. 386 PUBLIC LAW 97-35—AUG. 13, 1981
"(C) indicates the general locations of proposed housing for
lower income persons, with the objective of (i) furthering the
revitalization of the community, including the restoration and
rehabilitation of stable neighborhoods to the maximum extent
possible, and the reclamation of the housing stock where feasible
through the use of a broad range of techniques for housing
restoration by local government, the private sector, or commu-
nity organizations, including provision of a reasonable opportu-
nity for tenants displaced as a result of such activities to relocate
in their immediate neighborhood, (ii) promoting greater choice
of housing opportunities and avoiding undue concentrations of
assisted persons in areas containing a high proportion of low-
income persons, and (iii) assuring the availability of public
facilities and services adequate to serve proposed housing
projects.
"(2) The Secretary shall establish such dates and manner for the
submission of housing assistance plans described in paragraph (1) as
the Secretary may prescribe.".
42 u s e 5304. (c)(1) Section 104(d) of such Act is amended to read as follows:
Report. "(d) Each grantee shall submit to the Secretary, at a time deter-
mined by the Secretary, a performance report concerning the use of
funds made available under section 106, together with an assessment
by the grantee of the relationship of such use to the objectives
identified in the grantee's statement under subsection (a). The
Secretary shall, at least on an annual basis, make such reviews and
audits as may be necessary or appropriate to determine—
"(1) in the case of grants made under section 106(b) or section
Post. p. 389. 106(d)(2)(B), whether the grantee has carried out its activities
and, where applicable, its housing assistance plan in a timely
manner, whether the grantee has carried out those activities and
its certifications in accordance with the requirements and the
primary objectives of this title and with other applicable laws,
and whether the grantee has a continuing capacity to carry out
those activities in a timely manner; and
"(2) in the case of grants to States made under section 106(d),
whether the State has distributed funds to units of general local
government in a timely manner and in conformance to the
method of distribution described in its statement, whether the
State has carried out its certifications in compliance with the
requirements of this title and other applicable laws, and whether
the State has made such reviews and audits of the units of
general local government as may be necessary or appropriate to
determine whether they have satisfied the applicable perform-
ance criteria described in paragraph (1) of this subsection.
The Secretary may make appropriate adjustments in the amount of
the annual grants in accordance with the Secretary's findings under
this subsection. With respect to assistance made available to units of
Post, p. 389. general local government under section 106(d), the Secretary may
adjust, reduce, or withdraw such assistance, or take other action as
appropriate in accordance with the Secretary's reviews and audits
under this subsection, except that funds already expended on eligible
activities under this title shall not be recaptured or deducted from
future assistance to such units of general local government.".
Effective (2) The amendment made by paragraph (1) shall take effect on
date. October 1,1982.
42 u s e 5304 (d) Section 104 of such Act is amended by striking out subsections
note.
42 u s e 5304. (e) and (f) and redesignating subsections (g), (h), (i), and (j) as
subsections (e), (f), (g), and (h).
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 387
(e) Section 104(f) of such Act, as redesignated by subsection (d) of ^"*«' P- ^86.
this section, is amended—
(1) by striking out "applicants" in paragraph (1) and inserting
in lieu thereof 'Tecipiente of assistance under this title";
(2) by striking out "applicant" wherever it appears and insert-
ing in lieu thereof "recipient of assistance under this title";
(3) by striking out "applications and" in the last sentence of
paragraph (2); and
(4) by adding the following new paragraph at the end thereof:
"(4) In the case of grants made to States pursuant to section 106(d), f^ost, p. 389.
the State shall perform those actions of the Secretary described in
paragraph (2) and the performance of such actions shall be deemed to
satisfy the Secretary s responsibilities referred to in the second
sentence of such paragraph. .
(f) Section 104(g) of such Act, as redesignated by subsection (d) of Ante, p. 386.
this section, is amended—
(1) by striking out paragraph (1) and inserting in lieu thereof
the following:
"(1) Units of general local government receiving assistance under
this title may receive funds, in one payment, in an amount not to
exceed the total amount designated in the grant (or, in the case of a
unit of general local government receiving a distribution from a State
pursuant to section 106(d), not to exceed the total amount of such
distribution) for use in establishing a revolving loan fund which is to
be established in a private financial institution and which is to be
used to finance rehabilitation activities assisted under this title.
Rehabilitation activities authorized under this section shall begin
within 45 days after receipt of such payment."; and
(2) by striking out the last two sentences of paragraph (2).
EUGIBLE ACTIVITIES
SEC. 303. (a) Section 105(a) of the Housing and Community Develop-
ment Act of 1974 is amended— 42 use 5305.
(1) by striking out paragraph (8) and inserting in lieu thereof
the following:
"(8) provision of public services, including but not limited to
those concerned with employment, crime prevention, child care,
health, drug abuse, education, energy conservation, welfare or
recreation needs, if such services have not been provided by the
unit of general local government (through funds raised by such
unit, or received by such unit from the State in which it is
located) during any part of the twelve-month period immediately
preceding the date of submission of the statement with respect to
which funds are to be made available under this title, and which
are to be used for such services, unless the Secretary finds that
the discontinuation of such services was the result of events not
within the control of the unit of general local government, except
that not more than 10 per centum of the amount of any
assistance to a unit of general local government under this title
may be used for activities under this paragraph;";
(2) by inserting the following before the semicolon at the end of
paragraph (13) , and including the carrying out of activities as
described in section 701(e) of the Housing Act of 1954 on the date 94 Stat. 1662.
prior to the date of enactment of the Housing and Community
Development Amendments of 1981"; Ante, p. 384.
(3) by striking out "and" at the end of peiragraph (15);
95 STAT. 388 PUBLIC LAW 97-35—AUG. 13, 1981
(4) by striking out the period at the end of paragraph (16) and
inserting in lieu thereof'; and"; and
(5) by adding at the end thereof the following new paragraph:
"(17) provision of assistance to private, for-profit entities, when
the assistance is necessary or appropriate to carry out an
economic development project.",
Waiver. (b) In fiscal years 1982,1983, and 1984, the Secretary may waive the
42 u s e 5305 limitation on the amount of funds which may be used for public
note.
services activities under section 105(a)(8) of the Housing and Com-
Ante, p. 387. munity Development Act of 1974, as amended by this Act, in the case
of a unit of general local government which, during fiscal year 1981,
allocated more than 10 per centum of funds received under title I of
42 u s e 5301. the Housing and Community Development Act of 1974 for such
activities.
ALLOCATION AND DISTRIBUTION OF FUNDS
SEC. 304. (a) Section 106(a) of the Housing and Community Develop-
42 u s e 5306. ment Act of 1974 is amended to read as follows:
"(a) Of the amount approved in an appropriation Act under section
Ante, p. 384. 103 for grants in any year (excluding the amounts provided for use in
Post, pp. 391, accordance with section 107 and section 119), 70 per centum shall be
392. allocated by the Secretary to metropolitan cities and urban counties.
Except as otherwise specifically authorized, each metropolitan city
and urban county shall be entitled to an annual grant from such
allocation in an amount not exceeding its basic amount computed
pursuant to paragraph (1) or (2) of subsection (b).".
42 u s e 5306. (b) Section 106 of such Act is amended by striking out subsection (c)
and redesignating subsections (d), (e), (f), and (g) as subsections (c), (d),
(e), and (f), respectively.
(c) Section 106(c), as redesignated by subsection (b) of this section, is
amended to read as follows:
Reallocated "(c)(1) Except as provided in paragraph (2), any amounts allocated
funds. to a metropolitan city or an urban county pursuant to the preceding
provisions of this section which are not received by the city or county
for a fiscal year because of failure to meet the requirements of section
Ante, p. 384. 104(a), (b), or (c), or which become available as a result of actions
Ante, p. 386. under section 104(d) or 111, shall be reallocated in the succeeding
42 u s e 5311. fiscal year to the other metropolitan cities and urban counties in the
same metropolitan area which certify to the satisfaction of the
Secretary that they would be adversely affected by the loss of such
amounts from the metropolitan area. The amount of the share of
funds reallocated under this paragraph for any metropolitan city or
urban county shall bear the same ratio to the total of such reallocated
funds in the metropolitan area as the amount of funds awarded to the
city or county for the fiscal year in which the reallocated funds
become available bears to the total amount of funds awarded to all
metropolitan cities and urban counties in the same metropolitan area
for that fiscal year, except that—
"(A) in determining the amounts awarded to cities or counties
for purposes of calculating shares pursuant to this sentence,
there shall be excluded from the award of any city or county any
amounts which become available as a result of actions against
such city or county under section 111;
"(B) in reallocating amounts resulting from an action under
section 104(d) or section 111, the city or county against whom any
such action was taken shall be excluded from the calculation of
shares for purposes of reallocating the amounts becoming avail-
able as a result of such action; and
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 389
"(C) in no event may the share of reallocated funds for any
metropolitan city or urban county exceed 25 per centum of the
amount awarded to the city or county under section 106(b) for the 42 use 5306.
fiscal year in which the reallocated funds under this paragraph
become available.
Any amounts allocated under section 106(b) which become available
for reallocation and for which no metropolitan city or urban county
qualifies under this paragraph shall be added to amounts available
for allocation under such section 106(b) in the succeeding fiscal year.
"(2) Notwithstanding any other provision of this title, the Secretary
shall make grants from amounts authorized for use under section
106(b) by the Department of Housing and Urban Development—
Independent Agencies Appropriation Act, 1981, in accordance with 94 Stat. 3044.
the provisions of this title which governed grants with respect to such
amounts, as such provisions existed prior to the effective date of the
Housing and Community Development Amendments of 1981, except Ante, p. 384.
that any such amounts which are not obligated before January 1,
1982, shall be reallocated in accordance with paragraph (1).".
(d) Section 106(d)(1) of such Act, as redesignated by subsection (b) of
this section, is amended— Ante, p. 388.
(1) by striking out "section 108(a)" and all that follows through
"nonmetropolitan areas of each State" in the first sentence and
inserting in lieu thereof the following: "section 103 for grants in
any year (excluding the amounts provided for use in accordance
with section 107 and section 119), 30 per centum shall be Post, pp. 391,392.
allocated among the States for use in nonentitlement areas. The
allocation for each State shall be"; and
(2) by striking out "nonmetropolitan" wherever it appears and
inserting in lieu thereof "nonentitlement".
(e) Section 106(d) of such Act, as redesignated by subsection (b) of
this section, is amended by striking out paragraphs (2) and (3) and
inserting in lieu thereof the following:
"(2)(A) Amounts allocated under paragraph (1) shall be distributed
to units of general local government located in nonentitlement areas
of the State to carry out activities in accordance with the provisions of
this title—
"(i) by the State, consistent with the statement submitted
under section 104(a); or Ante, p. 384.
"(ii) by the Secretary, in any case described in subparagraph
(B), for use by units of general local government in accordance
with paragraph (3)(B).
Notwithstanding any provision of this title, the Secretary shall make
grants from amounts authorized for use in nonentitlement areas by
the Department of Housing and Urban Development—Independent
Agencies Appropriation Act, 1981, in accordance with the provisions 94 Stat. 3044.
of this title which governed grants with respect to such amounts, as
such provisions existed prior to the effective date of the Housing and
Community Development Amendments of 1981. Any amounts under Ante, p. 384.
the preceding sentence (except amounts for which preapplications
have been approved by the Secretary prior to October 1, 1981, and
which have been obligated by January 1,1982) which are or become
available for obligation after fiscal year 1981 shall be available for
distribution in the State in which the grants from such amounts were
made, by the State or by the Secretary, whichever is distributing the
State allocation in the fiscal year in which such amounts are or
become available,
"(B) The Secretary shall distribute amounts allocated under para-
graph (1) where—
95 STAT. 390 PUBLIC LAW 97-35—AUG. 13, 1981
"(i) the State has elected, in such manner and before such time
as the Secretary may prescribe, not to distribute such amounts;
or
"(ii) the State has failed to submit the certifications described
in subparagraph (C).
"(C) To receive and distribute amounts allocated under paragraph
(1), the Governor must certify that the State, with respect to units of
general local government in nonentitlement areas—
"(i) engages or will engage in planning for community develop-
ment activities;
"(ii) provides or will provide technical assistance to units of
general local government in connection with community devel-
opment programs;
"(iii) will provide, out of State resources, funds for community
development activities in an amount which is at least 10 per
centum of the amounts allocated for use in the State pursuant to
paragraph (1); and
"(iv) has consulted with local elected officials from among
units of general local government located in nonentitlement
areas of that State in determining the method of distribution of
funds required by subparagraph (A).
"(8)(A) If the State receives and distributes such amounts, it shall
be responsible for the administration of funds so distributed. The
State shall pay from its own resources all administrative expenses
incurred by the State in carrying out its responsibilities under this
title, except that from the amounts received for distribution in
nonentitlement areas, the State may deduct an amount not to exceed
50 per centum of the costs incurred by the State in carrying out such
responsibilities. Amounts so deducted shall not exceed 2 per centum
of the amount so received.
"(B) If the Secretary distributes such amounts, the distribution
shall be made in accordance with determinations of the Secretary
pursuant to statements submitted and the other requirements of
Ante, p. 384. section 104 (other than subsection (c)) and in accordance with regula-
tions and procedures prescribed by the Secretary.
"(C) Any amounts allocated for use in a State under this subsection
Ante, p. 386. which become available as a result of actions under section 104(d) or
42 use 5311. I l l shall—
"(i) in the case of actions against units of general local
government in nonentitlement areas, be added to amounts avail-
able for distribution in the State in the fiscal year in which the
amounts become so available; or
"(ii) in the case of actions against the State, be added to
amounts available for distribution in the State in the succeeding
fiscal year.
Amounts reallocated under this subparagraph shall be available for
distribution by the State or by the Secretary, whichever is distribut-
ing the State allocation in the fiscal year in which such reallocated
amounts are added.
"(4) In computing amounts under paragraph (1), Indian tribes shall
be excluded.".
Ante, p. 388. (f) Section 106(f), as redesignated by subsection (b) of this section, is
amended by striking out "(1)" and all that follows through "106(e)"
and inserting in lieu thereof "all basic grant entitlement amounts".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 391
DISCRETIONARY FUND
SEC. 305. Section 107 of the Housing and Community Development
Act of 1974 is amended to read as follows: 42 u s e 5307.
DISCRETIONARY FUND
"SEC. 107. (a) Of the total amount approved in appropriation Acts
under section 103 for each of the fiscal years 1982 and 1983, not more Ante, p. 384.
than $60,000,000 for each of the fiscal years 1982 and 1983 may be set
aside in a special discretionary fund for grants under subsection (b).
Grants under this section are in addition to any other grants which
may be made under this title to the same entities for the same
purposes.
"(b) From amounts set aside under subsection (a), the Secretary is
authorized to make grants—
"(1) in behalf of new communities assisted under title VII of
the Housing and Urban Development Act of 1970 or title IV of 42 u s e 4501.
the Housing and Urban Development Act of 1968 or in behalf of 42 u s e 3901.
new community projects assisted under title X of the National
Housing Act which meet the eligibility stemdards set forth in 12 u s e 1749aa.
title Vn of the Housing and Urban Development Act of 1970 and
which were the subject of an application or preapplication under
such title prior to January 14,1975;
"(2) in Guam, the Virgin Islands, American Samoa, the North-
ern Mariana Islands, and the Trust Territory of the Pacific
Islands;
"(3) to Indian tribes; and
"(4) to States, units of general local government, Indian tribes, Technical
or areawide planning organizations for the purpose of providing Eissistance.
technical assistance in planning, developing, and administering
assistance under this title, and to States and units of general
local government for implementing special projects otherwise
authorized under this title. The Secretary may also provide,
directly or through contracts, technical assistaiice under this
paragraph to such governmental units, or to a group designated
by such a governmental unit for the purpose of assisting that
governmental unit to carry out assistance under this title.
"(c) Amounts set aside for use under subsection (b) in any fiscal
year but not used in that year shall remain available for use in
subsequent fiscal years in accordance with the provisions of that
subsection.
"(dXD Except as provided in paragraph (2), no grant may be made
under this section or section 119 unless the applicant provides Post, p. 392.
satisfactory assurances that its program will be conducted and
administered in conformity with Public Law 88-352 and Public Law
90-284. 42 u s e 2000a
"(2) No grant may be made to an Indian tribe under this section or note;
section 119 unless the applicant provides satisfactory assurances that 82 Stat. 73.
its program will be conducted and administered in conformity with
title II of Public Law 90-284. The Secretary may waive, in connection Waiver.
with grants to Indian tribes, the provisions of section 109 and section 25 u s e 1301.
110. 42 u s e 5309,
"(3) The Secretary may accept a certification from the applicant 5310.
that it has complied with the requirements of paragraph (1) or (2), as
appropriate.".
89-194 O—82 27 : QL3
95 STAT. 392 PUBLIC LAW 97-35—AUG. 13, 1981
NONDISCRIMINATION
SEC. 306. Section 109(a) of the Housing and Community Develop-
42 u s e 5309. ment Act of 1974 is amended by adding the following new sentence at
the end thereof: "Any prohibition against discrimination on the basis
42 u s e 6101 of age under the Age Discrimination Act of 1975 or with respect to an
note. otherwise qualified handicapped individual as provided in section 504
29 u s e 794. of the Rehabilitation Act of 1973 shall also apply to any such program
or activity.".
TRANSITIONAL PROVISIONS
42 u s e 5306 SEC. 307. (a) Any amounts appropriated for any fiscal year before
note. fiscal year 1982 in a Department of Housing and Urban Develop-
ment—Independent Agencies Appropriation Act or a Supplemental
Appropriation Act under the head "COMMUNITY DEVELOPMENT
GRANTS" which are or become available for obligation on or after
October 1,1981, shall remain available as provided by law, and shall
be used in accordance with the following:
(1) funds authorized for use under section 106(b) of the Housing
42 u s e 5306. and Community Development Act of 1974 ("such Act") before
October 1, 1981, shall be available for use as provided by section
Ante, p. 388. 106(c) of such Act as amended by this Act;
42 u s e 5307. (2) funds authorized for use under section 107 of such Act
before October 1, 1981, shall be available for use as provided by
Ante, p. 391.
section 107(a) of such Act as amended by this Act; and
(3) funds authorized for use under section 106(c) or (e) of such
Act before October 1,1981, shall be available for use as provided
by section 106(d)(2)(A) of such Act as amended by this Act.
Ante, p. 389. (b) Any grant or loan which, prior to the effective date of any
provision of this part, was obligated and governed by any authority
amended by any provision of this part shall continue to be governed
by the provisions of such authority as they existed immediately
before such effective date.
URBAN DEVELOPMENT ACTION GRANTS
SEC. 308. (a) Section 119 of the Housing and Community Develop-
42 u s e 5318. ment Act of 1974 is amended to read as follows:
URBAN DEVELOPMENT ACTION GRANTS
"SEC. 119. (a) The Secretary is authorized to make urban develop-
ment action grants to cities and urban counties which are experienc-
ing severe economic distress to help stimulate economic development
activity needed to aid in economic recovery. Of the total amount
42 use 5303. approved in appropriation Acts under section 103 for each of the
fiscal years 1982 and 1983, not more than $500,000,000 shall be
available for each of the fiscal years 1982 and 1983 for grants under
this section.
"Ol5)(l) Urban development action grants shall be made only to
cities and urban counties which have, in the determination of the
Secretary, demonstrated results in providing housing for low- and
moderate-income persons and in providing equal opportunity in
housing and employment for low- and moderate-income persons and
Regulations. members of minority groups. The Secretary shall issue regulations
establishing criteria in accordance with the preceding sentence and
setting forth minimum standards for determining the level of eco-
nomic distress of cities and urban counties for eligibility for such
grants. These standards shall take into account factors such as the
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 393
age of housing; the extent of poverty; the extent of population lag;
growth of per capita income; and, where data are available, the
extent of unemployment and job lag.
"(2) A city or urban county which fails to meet the minimum
standards established pursuant to paragraph (1) shall be eligible for
assistance under this section if it meets the requirements of the first
sentence of such paragraph and—
"(A) in the case of a city with a population of fifty thousand
persons or more or an urban county, contEiins an area (i)
comi)Osed of one or more contiguous census tracts, enumeration
districts, or block groups, as defined by the United States Bureau
of the Census, having at least a population of ten thousand
persons or 10 per centum of the population of the city or urban
county; (ii) in which at lesist 70 per centum of the residents have
incomes below 80 per centum of the median income of the city or
urban county; and (iii) in which at least 30 per centum of the
residents have incomes below the national poverty level; or
"(B) in the case of a city with a population of less than fifty
thousand persons, contains an area (i) composed of one or more
contiguous census tracts, enumeration districts, or block groups
or other areas defined by the United States Bureau of the Census
or for which data certified by the United States Bureau of the
Census are available having at least a population of two thou-
sand five hundred persons or 10 per centum of the population of
the city, whichever is greater; (ii) in which at least 70 per centum
of the residents have incomes below 80 per centum of the median
income of the city; and (iii) in which at least 30 per centum of the
residents have incomes below the national poverty level.
The Secretary shall use up to, but not more than, 20 per centum of the
funds appropriated for use in any fiscal year under this section for
the purpose of making grants to cities and urban counties eligible
under this paragraph.
"(c) Applications for eissistance under this section shall— Contents.
"(1) in the case of an application for a grant under subsection
(bX2), include documentation of grant eligibility in accordance
with the standards described in that subsection;
"(2) set forth the activities for which assistance is sought,
including (A) an estimate of the costs and general location of the
activities; (B) a summary of the public and private resources
which are expected to be made available in connection with the
activities, including how the activities will take advantage of
unique opportunities to attract private investment; and (C) an
analysis of the economic benefits which the activities are
expected to produce;
'(3) contain a certification satisfactory to the Secretary that
the applicant, prior to submission of its application, (A) has held
public hearings to obteiin the views of citizens, particularly
residents of the area in which the proposed activities are to be
carried out, and (B) has analyzed the impact of these proposed
activities on the residents, particularly those of low and moder-
ate income, of the residential neighborhood, and on the neighbor-
hood in which they are to be carried out; and
"(4) contain a certification satisfactory to the Secretary that
the applicant, prior to submission of its application, (A) has
identified all properties, if any, which are included on the
National Register of Historic Places and which, as determined by
the applicant, will be affected by the project for which the
application is made; (B) ha-s identified all other properties, if any,
95 STAT. 394 PUBLIC LAW 97-35—AUG. 13, 1981
which will be affected by such project and which, as determined
by the applicant, may meet the criteria established by the
Secretary of the Interior for inclusion on such Register, together
with documentation relating to the inclusion of such properties
on the Register; (C) has determined the effect, as determined by
the applicant, of the project on the properties identified pursuant
to clauses (A) and (B); and (D) will comply with the requirements
94 Stat. 1620. of section 121.
42 u s e 5320. "(dXD Except in the case of a city or urban county eligible under
Selection
criteria, subsection (b)(2), the Secretary shall establish selection criteria for
establish- grants under this section which must include (A) as the primary
ment. criterion, the comparative degree of economic distress among appli-
cants, as measured (in the case of a metropolitan city or urban
county) by the differences in the extent of growth lag, the extent of
poverty, and the adjusted age of housing in the metropolitan city or
urban county; (B) other factors determined to be relevant by the
Secretary in assessing the comparative degree of economic deteriora-
tion in cities and urban counties; and (C) at least the following other
criteria: demonstrated performance of the city or urban county in
housing and community development programs; the extent to which
the grant will stimulate economic recovery by leveraging private
investment; the number of permanent jobs to be created and their
relation to the amount of grant funds requested; the proportion of
permanent jobs accessible to lower income persons and minorities,
including persons who are unemployed; the impact of the proposed
activities on the fiscal base of the city or urban county and its relation
to the amount of grant funds requested; the extent to which State or
local government funding or special economic incentives have been
committed; and the feasibility of accomplishing the proposed activi-
ties in a timely fashion within the grant amount available.
"(2) For the purpose of making grants with respect to areas
described in subsection (bX2), the Secretary shall establish selection
criteria, which must include (A) factors determined to be relevant by
the Secretary in assessing the comparative degree of economic
deterioration among eligible areas, and (B) such other criteria as the
Secretary may determine, including at a minimum the criteria listed
in paragraph (IXC) of this subsection.
City or urban "(e) The Secretary may not approve any grant to a city or urban
county, eli- county eligible under subsection (bX2) unless—
gibility.
"(1) the grant will be used in connection with a project located
in an area described in subsection (bX2), except that the Secre-
tary may waive this requirement where the Secretary deter-
mines (A) that there is no suitable site for the project within that
area, (B) the project will be located directly adjacent to that area,
and (C) the project will contribute substantially to the economic
development of that area;
"(2) the city or urban county has demonstrated to the satisfac-
tion of the Secretary that basic services supplied by the city or
urban county to the area described in subsection (bX2) are at least
equivalent, as measured by per capita expenditures, to those
supplied to other areas within the city or urban county which are
similar in population size and physical characteristics and which
have median incomes above the median income for the city or
urban county;
"(8) the grant will be used in connection with a project which
will directly benefit the low- and moderate-income families and
individuals residing in the area described in subsection (bX2); and
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 395
"(4) the city or urban county makes available, from its own
funds or from funds received from the State or under any Federal
program which permits the use of financial assistance to meet
the non-Federal share requirements of Federal grant-in-aid pro-
grams, an amount equal to 20 per centum of the grant to be
available under this section to be used in carrying out the
activities described in the application.
"(f) Activities assisted under this section may include such activi-
ties, in addition to those authorized under section 105(a), as the 42 u s e 5305.
Secretary determines to be consistent with the purposes of this
section.
"(g) The Secretary shall, at least on an annual basis, make reviews Reviews and
and audits of recipients of grants under this section as necessary to audits.
determine the progress made in carrying out activities substantially
in accordance with approved plans and timetables. The Secretary
may adjust, reduce, or withdraw grant funds, or take other action as
appropriate in accordance with the findings of these reviews and
audits, except that funds edready expended on eligible activities
under this title shall not be recaptured or deducted from future
grants made to the recipient.
"(h) No assistance may be provided under this section for projects Industrial
intended to facilitate the relocation of industrial or commercial or commercial
plants or facilities from one area to another, unless the Secretary plants or facili-
ties, £issistance.
finds that the relocation does not significantly and adversely affect
the unemployment or economic base of the area from which the
industrial or commercial plant or facility is to be relocated.
"(i) Not less than 25 per centum of the funds made available for
grants under this section shall be used for cities with populations of
less than fifty thousand persons which are not central cities of a
metropolitan statistical area.
"(j) A grant may be made under this section only where the
Secretary determines that there is a strong probability that (1) the
non-Federal investment in the project would not be made without the
grant, and (2) the grant would not substitute for non-Federal funds
which are otherwise available to the project.
"(k) In making grants under this section, the Secretary shall take
such steps as the Secretary deems appropriate to assure that the
amount of the grant provided is the least necessary to make the
project feasible.
* (1) For purposes of this section, the Secretary may reduce or waive
the requirement in section 102(a)(5)(BXii) that a town or township be 42 u s e 5302.
closely settled.
"(m) In the case of any application which identifies any property in
accordance with subsection (c)(4)(B), the Secretary may not commit
funds with respect to an approved application unless the applicant
has certified to the Secretary that the appropriate State historic
preservation officer and the Secretary of the Interior have been
provided an opportunity to take action in accordance with the
provisions of section 121(b). 94 Stat. 1620.
"(nXD For the purposes of this section, the term 'city' includes 42 u s e 5320.
Guam, the Virgin Islands, and Indian tribes. "City.'^
"(2) The Secretary may not approve a grant to an Indian tribe
under this section unless the tribe (A) is located on a reservation or in
an Alaskan Native Village, and (B) is an eligible recipient under the
State and Local Fiscal Assistance Act of 1972. 31 u s e 1221
"(o) If no amounts are set aside under, or amounts are precluded note.
from being appropriated for this section for fiscal years after fiscal
year 1983, any amount which is or becomes available for use under
95 STAT. 396 PUBLIC LAW 97-35—AUG. 13, 1981
this section after fiscal year 1983 shall be added to amounts appropn-
42 u s e 5303. ated under section 103. % _ *
94 Stat. 1620. (b) Section 121 of such Act is amended by striking out "subsecGbn
42 u s e 5320. (cX7XB)" in subsection (b) and inserting in lieu thereof "subsection
(c)(4XB)".
Effective date. (c) The amendments made by subsections (a) and (b) shall become
42USC5318 effective on the effective date of regulations implementing such
note. subsections. As soon as practicable, but not later than January 1,
Rules and
regulations. 1982, the Secretary shall issue such final rules and regulations as the
Secretary determines are necessary to carry out such subsections.
COMMUNITY DEVELOPMENT TECHNICAL AMENDMENTS
SEC. 309. (a) Section 102(a) of the Housing and Community Develop-
42 u s e 5302. ment Act of 1974 is amended—
(1) by striking out paragraphs (18) and (19);
(2) by inserting immediately after paragraph (6) the following:
"Npnentitlement "(7) The term 'nonentitlement area' means an area which is
area."
not a metropolitan city or part of an urban county."; and
(3) by redesignating the remaining paragraphs accordingly.
(b) Section 102(c) of such Act is amended by striking out a
(Community Development Program in whole or in part" and inserting
94 Stat. 1614.
in lieu thereof "activities assisted under this title".
42 u s e 5302. (c) The first sentence of section 102(d) of such Act is amended—
(1) by striking out "103(aXl)" and inserting in lieu thereof
"103"; and
(2) by striking out "unless the application by the urban county
is disapproved or withdrawn prior to or during such three-year
period' and inserting in lieu thereof "unless the urban county
does not receive a grant for any year during such three-year
94 Stat. 1615. period".
42 u s e 5304. (d) Section 104(j) of such Act is amended by striking out "planning a
joint community development program, meeting the application
requirements of this section, and implementing such program" and
inserting in lieu thereof "submitting a statement under section 104(a)
42 u s e 5305. and carrying out activities under this title".
(e) The caption of section 105 of such Act is amended to read as
follows: "EUGIBLE ACTIVITIES".
(f) Section 105(a) of such Act is amended—
(1) by striking out the first sentence and "These activities" in
the second sentence and inserting in lieu thereof "Activities
assisted under this title";
(2) by striking out "program" in paragraph (6);
(3) by striking out the Community Development Program" in
paragraph (9) and inserting in lieu thereof "activities assisted
under this title";
(4) by striking out "to the community development program"
in paragraph (11);
(5) by striking out "(as specifically" and all that follows
through "104(aXl)" in paragraph (14) and inserting in lieu
thereof "which are carried out by public or private nonprofit
94 Stat. 1618.
entities"; and
(6) by striking out "(as specifically described in the application
submitted pursuant to section 104)" in paragraph (15).
(g) Section 105(b) of such Act is amended by striking out "a grant"
94 Stat. 1615. and inserting in lieu thereof "assistance".
42 u s e 5306. (h) The second sentence of section 106(bX4) of such Act is amended
by striking out "for a grant under subsection (c) or (e)" and inserting
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 397
in lieu thereof the following: "to receive assistance under subsection
(d)".
(i) Section 108(d)(2) of such Act is amended by striking out 42 use 5308.
"approved or".
0) The first sentence of section 110 of such Act is amended by 42 use 53io.
striking out "grants" and inserting in lieu thereof "assistance .
(k) The first sentence of section 112(a) of such Act is amended by 42 use 5312.
striking out "103(a)" and inserting in lieu thereof "103".
(1) Section 113(a)(2) of such Act is amended by striking out "as 42 use 5813.
approved by the Secretary".
(m) Section 116(b) of such Act is amended to read as follows: 94 Stet. 1622.
"(b) In the case of funds available for any fiscal year, the Secretary ^^
shall not consider any statement under section 104(a), unless such
statement is submitted on or prior to such date (in that fiscal year) as
the Secretary shall establish as the final date for submission of
statements in that year.".
COMMUNITY DEVELOPMENT MISCELLANEOUS AMENDMENTS
SEC. 310. (a) Section 102(aK4) of the Housing and Community
Development Act of 1974 is amended by inserting the following before 42 use 5302.
the period at the end thereof: "or until September 30,1982, whichever
is later".
(b) Section 102(a)(6) of such Act is amended by inserting at the end
thereof the following: "Any urban county (A) which qualified as an
urban county in fiscal year 1981, (B) the population of which includes
all of the population of the county (other than the population of
metropolitan cities therein), and (C) the population of which for fiscal
year 1982 falls below the amount required by clause (B) of the
preceding sentence by reason of the 1980 decennial census shall be
considered as meeting the population requirements of such clause for
fiscal year 1982 and shall not be subject to the provisions of section
102(d) in that fiscal year.".
REHABIUTATION LOANS
SEC. 311. (a) Subsection (a)(1)(D) of section 312 of the Housing Act of
1964 is amended by striking out "an approved community develop- 42 use I452b.
ment program" and inserting in lieu thereof "community develop-
ment activities".
(b) Subsection (d) of such section is amended— 94 Stat. 1622.
(1) by inserting "and" after "October 1, 1979," in the first
sentence *
(2) by striking out "and not to exceed $129,000,000 for the fiscal
year beginning on October 1, 1981," in the first sentence; and
(3) by striking out the last sentence.
(c) Subsection (h) of such section is amended by striking out "1982"
each place it appears and inserting in lieu thereof "1983".
(d) Subsection (j)(l) of such section is amended by striking out the
second sentence.
URBAN H O M E S T E A D I N G
SEC. 312. The first sentence of section 810(h) of the Housing and
Community Development Act of 1974 is amended by striking out 12 use I706e.
"and not to exceed $26,000,000 for the fiscal year 1979"^ and inserting
in lieu thereof "not to exceed $26,000,000 for the fiscal year 1979, and
not to exceed $13,467,000 for the fiscal year 1983".
95 STAT. 398 PUBLIC LAW 97-35—AUG. 13, 1981
REPEALERS
SEC. 313. (a) Title Vn of the Housing and Ck)mmunity Development
42 u s e 8121 Amendments of 1978 is hereby repealeid.
note. (b) Section 701 of the Housing Act of 1954 is hereby repealed.
94 Stat. 1662.
40 u s e 461.
NEIGHBORHOOD REINVESTMENT CORPORATION
SEC. 314. Section 608(a) of the Neighborhood Reinvestment Corpo-
94 Stat. 1645. ration Act is amended—
42 u s e 8107. (1) by striking out "and" after "1980,"; and
(2) by inserting the following before the period at the end
thereof: ", and not to exceed $14,950,000 for fiscal year 1982".
REPORT ON BLOCK GRANT PROGRAM
Report to SEC. 315. Not later than 270 days after the date of enactment of this
eongress. ^Q^^ ^jjg Secretary of Housing and Urban Development shall report to
the Congress on administrative and legislative steps that can be
taken to-—
(1) require all grantees to concentrate their block grant funds
in distressed geographic areas small enough so that visible
improvements can be achieved in a reasonable time period and to
ensure that claimed benefits to low- and moderate-income per-
sons are, in actuality, occurring;
(2) reduce the broad list of activities currently eligible so that
funds can be focused on those activities which meet the cities'
most urgent revitalization needs;
(3) develop overall income eligibility requirements for recipi-
ents of block grant supported rehabilitation; and
(4) limit eligible rehabilitation work to that which is essential
to restore the housing unit to a decent, safe, and sanitary or
energy efficient condition, specifically prohibiting nonessential
and luxury items, so that more homes needing basic repairs C£m
be rehabilitated.
PART 2—HOUSING ASSISTANCE PROGRAMS
HOUSING AUTHORIZATIONS
Contracts. SEC. 321. (a) The first sentence of section 5(c)(1) of the United States
94 Stat. 1624. Housing Act of 1937 is amended by inserting immediately after
42 u s e 1437c. "1980" the following: ", and by $906,985,000 on October 1, 1981".
(b) The second sentence of section 5(cXl) of such Act is amended by
striking out "Acts;" and all that follows through the period and
inserting in lieu thereof the following: "Acts. In addition, the aggre-
gate amount which may be obligated over the duration of the
contracts may not exceed $31,200,000,000 with respect to the addition-
al authority provided on October 1, 1980, and $18,087,370,000 with
respect to the additional authority provided on October 1, 1981.".
(c) Section 5(c) of such Act is amended by—
(1) redesignating paragraphs (3), (4), and (5) as paragraphs (4),
(5), and (6), respectively; and
(2) inserting immediately after paragraph (2) the following:
"(3)(A) Of the additional authority approved in appropriation Acts
and made available on October 1, 1981, the Secretary shall make
available at least $75,000,000 for assistance to projects under section
94 Stat. 1625. 14.
42 u s e 1437/.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 399
"(B) Of the balance of the additional authority referred to in the
preceding subparagraph which remains after deducting the amount
to be provided for assistance to projects under section 14, the 94 Stat. 1625.
Secretary shall allocate such authority for use in different areas and 42 u s e 1437Z.
communities in accordance with section 213(d) of the Housing and
Community Development Act of 1974, except that on a national basis 42 u s e 1439.
the Secretary may not enter into contracts aggregating—
"(i) more than 45 per centum of such baleuice for existing units
assisted under this Act; and
"(ii) more than 55 per centum of such balance for newly
constructed and substantially rehabilitated units assisted under
this Act.
"(C) After making allocations referred to in subparagraph (B), the General local
Secretary shsM, to the extent allowable within the percentage limita- government
preferences,
tions conteiined in such subparagraph and within the available accommodation.
contract and budget authority, accommodate the preferences of units
of general local government, which preferences shall be established
after consultation with the appropriate public housing agencies,
regarding (i) the mix among newly constructed, substantially reha-
bilitated, existing, or moderately rehabilitated units; (ii) the pro-
grams under which assistance is to be provided; and (iii) the extent to
which such allocation should be used for comprehensive improve-
ment assistance under section 14.".
(d) Section 9(c) of such Act is amended— 42 u s e 1437g.
(1) by striking out "and" after "on or after October 1,1979,";
and
(2) by inserting before the period at the end thereof the
following: ", and not to exceed $1,500,000,000 on or after October
1,1981".
(e) Section 213(d) of the Housing and Community Development Act Financial
of 1974 is amended by adding at the end thereof a new paragraph to assistance,
retention.
read as follows: 42 u s e 1439.
"(4) Notwithstanding any other provision of law, with respect to
fiscal years beginning after September 30, 1981, the Secretary of
Housing and Urban Development may not reteiin more than 15 per
centum of the financial assistance which becomes available under
programs described in subsection (aXD during any fiscal year. Any Allocation
such financial assistance which is retciined shall be available for use.
subsequent allocation to specific areas and communities, and may
only be used for—
"(A) unforeseeable housing needs, especially those brought on
by natural disasters or special relocation requirements;
"(B) support for the needs of the handicapped or for minority
enterprise;
"(C) providing for assisted housing as a result of the settlement
of litigation;
"(D) small research and demonstration projects;
"(E) lower-income housing needs described in housing assist-
ance plans, including activities carried out under areawide
housing opportunity plans; and
"(F) innovative housing programs or alternative methods for
meeting lower-income housing needs approved by the Secretary,
including assistance for infrastructure in connection with the
Indisui Housing Program.".
(fKD The first sentence of section 201(h) of the Housing and
Community Development Amendments of 1978 is amended— 12 use
(A) by striking out "and" after "the fiscal year 1980,"; 1715z-la.
95 STAT. 400 PUBLIC LAW 97-35—AUG. 13, 1981
(B) by inserting before the period at the end thereof the
following: ", and not to exceed $4,000,000 for the fiscal year
1982"; and
(C) by striking out the comma immediately following "Act"
and inserting in lieu thereof a closed parenthesis.
(2) Section 201 of the Housing and Community Development
12 u s e 1715Z-1 Amendments of 1978 is amended—
and note, (A) by redesignating subsections (h) and (i) as subsections (j)
1715z-la.
and (k), respectively; and
12 use (B) by inserting the following new subsection after subsection
1715z-la.
(g):
"(h) The Secretary may not use any of the assistance available
under this section during any fiscal year beginning on or after
October 1, 1981, to supplement any contract to make rental assist-
ance pajrments which was made pursuant to section 101 of the
12 u s e 1701s, Housing and Urban Development Act of 1965.".
42 u s e 1451.
(3) The third sentence of section 236(f)(3) of the National Housing
Post, p. 403. Act, as redesignated by section 322(f)(7) of this part, is amended by
striking out "September 30, 1981" and inserting in lieu thereof
"September 30,1982".
TENANT RENTAL PAYMENTS
42 use 1437a. SEC. 322. (a) Section 3 of the United States Housing Act of 1937 is
amended to read as follows:
RENTAL P A Y M E N T S ; DEFINITIONS
"SEC. 3. (a) Dwelling units assisted under this Act shall be rented
only to families who are lower income families at the time of their
initial occupancy of such units. A family shall pay as rent for a
dwelling unit assisted under this Act the highest of the following
amounts, rounded to the nearest dollar:
"(1) 30 per centum of the family's monthly adjusted income;
"(2) 10 per centum of the family's monthly income; or
"(3) if the family is receiving payments for welfare assistance
from a public agency and a part of such payments, adjusted in
accordance with the family's actual housing costs, is specifically
designated by such agency to meet the family's housing costs, the
portion of such payments which is so designated.
"(b) When used in this Act:
"(1) The term 'lower income housing' means decent, safe, and
sanitary dwellings assisted under this Act. The term 'public housing'
means lower income housing, and all necessary appurtenances
thereto, assisted under this Act other than under section 8. When
used in reference to public housing, the term 'lower income housing
project' or 'project' means (A) housing developed, acquired, or assist-
ed by a public housing agency under this Act, and (B) the improve-
ment of any such housing.
"(2) The term 'lower income families' means those families whose
incomes do not exceed 80 per centum of the median income for the
area, as determined by the Secretary with adjustments for smaller
and larger families, except that the Secretary may establish income
ceilings higher or lower than 80 per centum of the median for the
area on the basis of the Secretary's findings that such variations are
necessary because of prevailing levels of construction costs or unusu-
ally high or low family incomes. The term 'very low-income families'
means lower income families whose incomes do not exceed 50 per
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 401
centum of the median family income for the area, as determined by
the Secretary with adjustments for smaller and larger families.
"(3) The term 'families' includes families consisting of a single
person in the case of (A) a person who is at least sixty-two years of age
or is under a disability as defined in section 223 of the Social Security
Act or in section 102 of the Developmental Disabilities Services and 42 use 423.
Facilities Construction Amendments of 1970, or is handicapped, (B) a 42 use 6001.
displaced person, (C) the remaining member of a tenant family, and
(D) other single persons in circumstances described in regulations of
the Secretary. In no event shall more than 15 per centum of the units
under the jurisdiction of any public housing agency be occupied by
single persons under clause (D). In determining priority for admission
to housing under this Act, the Secretary shall give preference to those
single persons who are elderly, handicapped, or displaced before
those eligible under clause (D). The term 'elderly families' means
families whose heads (or their spouses), or whose sole members, are
persons described in clause (A). A person shall be considered handi-
capped if such person is determined, pursuant to regulations issued
by the Secretary, to have an impairment which is expected to be of
long-continued and indefinite duration, substantially impedes such
person's ability to live independently, and is of such a nature that
such ability could be improved by more suitable housing conditions.
The term 'displaced person' means a person displaced by governmen-
tal action, or a person whose dwelling has been extensively damaged
or destroyed as a result of a disaster declared or otherwise formally
recognized pursuant to Federal disaster relief laws. Notwithstanding
the preceding provisions of this subsection, the term 'elderly families'
includes two or more elderly, disabled, or handicapped individuals
living together, or one or more such individuals living with one or
more persons determined under regulations of the Secretary to be
essential to their care or well being.
"(4) The term 'income' means income from all sources of each
member of the household, as determined in accordance with criteria
prescribed by the Secretary.
"(5) The term 'adjusted income' means the income which remains
after excluding such amounts or types of income as the Secretary
may prescribe. In determining amounts to be excluded from income,
the Secretary may, in the Secretary's discretion, take into account
the number of minor children in the household and such other factors
as the Secretary may determine are appropriate.
"(6) The term 'public housing agency' means any State, county,
municipality, or other governmental entity or public body (or agency
or instrumentality thereof) which is authorized to engage in or assist
in the development or operation of lower income housing.
"(7) The term 'State includes the several States, the District of
Columbia, the Commonwealth of Puerto Rico, the territories and
possessions of the United States, the Trust Territory of the Pacific
Islands, and Indian tribes, bands, groups, and Nations, including
Alaska Indians, Aleuts, and Eskimos, of the United States.
"(8) The term 'Secretary' means the Secretary of Housing and
Urban Development.
"(c) When used in reference to public housing:
"(1) The term 'development' means any or all undertakings neces-
sary for planning, land acquisition, demolition, construction, or
equipment, in connection with a lower income housing project. The
term 'development cost' comprises the costs incurred by a public
housing agency in such undertakings and their necessary financing
(including the payment of carrying charges), and in otherwise carry-
95 STAT. 402 PUBLIC LAW 97-35—AUG. 13, 1981
ing out the development of such project. Construction activity in
connection with a lower income housing project may be confined to
the reconstruction, remodeling, or repair of existing buildings.
"(2) The term 'operation' means any or all undertakings appropri-
ate for management, operation, services, maintenance, security (in-
cluding the cost of security personnel), or financing in connection
with a lower income housing project. The term also means the
financing of tenant programs and services for families residing in
lower income housing projects, particularly where there is maximum
feasible participation of the tenants in the development and oper-
ation of such tenant programs and services. As used in this para-
graph, the term 'tenant programs and services' includes the develop-
ment and maintenance of tenant organizations which participate in
the management of lower income housing projects; the training of
tenants to manage and operate such projects and the utilization of
their services in project management and operation; counseling on
household management, housekeeping, budgeting, money manage-
ment, child care, and similar matters; advice as to resources for job
training and placement, education, welfare, health, and other com-
munity services; services which are directly related to meeting tenant
needs and providing a wholesome living environment; and referral to
appropriate agencies in the community when necessary for the
provision of such services. To the maximum extent available and
appropriate, existing public and private agencies in the community
shall be used for the provision of such services.
"(3) The term 'acquisition cost' means the amount prudently
required to be expended by a public housing agency in acquiring
property for a lower income housing project.".
42 u s e 1437b, (b) Sections 4, 5, 9, and 11 of such Act are amended by striking out
1437c, 1437g, "LOW-INCOME" where it appears in the caption accompanying each
14371. such section and by inserting in lieu thereof "LOWER INCOME".
42 u s e 1437, (c) Sections 2, 4, 5, 6, 9, 11, 12, and 14 of such Act are amended by
1437b-1437d, striking out "low income" and "low-income" wherever they appear
1437g, 14371,
1437J; and inserting in lieu thereof "lower income".
94 Stat. 1625, (d) Section 6(c)(2) of such Act is amended by striking out the phrase
42 u s e 1437/. "at intervals of two years (or at shorter intervals where the Secretary
42 u s e 1437d. deems it desirable)" and inserting in lieu thereof "no less frequently
than annually".
42 u s e 1437f. (e) Section 8 of such Act is amended—
(1) by striking out paragraph (3) of subsection (c) and inserting
in lieu thereof the following:
"(3) The amount of the monthly assistance payment with respect to
any dwelling unit shall be the difference between the maximum
monthly rent which the contract provides that the owner is to receive
for the unit and the rent the family is required to pay under section
Ante, p. 400. 3(a) of this Act. Reviews of family income shall be made no less
frequently than annually.";
(2) by striking out paragraph (7) of subsection (c) and redesig-
nating paragraph (8) of such subsection as paragraph (7);
(3) by striking out paragraphs (1), (2), and (3) of subsection (f)
and redesignating paragraphs (4), (5), and (6) of such subsection
as paragraphs (1), (2), and (3), respectively;
(4) by striking out "The provisions of section 3(1), 5(e), and 6" in
subsection (h) and inserting in lieu thereof "Sections 5(e) and 6";
(5) by striking out the comma after the word "Act" in subsec-
tion (h); and
(6) by striking out "25 per centum of one-twelfth of the annual
income of such family" in paragraph (3) of subsection (j) and
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 403
inserting in lieu thereof "the rent the family is required to pay
under section 3(a) of this Act". Ante, p. 400.
(f) Section 236 of the National Housing Act is amended— 12 use I7i5z-l.
(1) by striking out "two years" in subsection (e) and inserting in
lieu thereof "one year";
(2) by striking out "25 per centum of the tenant's income" in
the second sentence of subsection (fKD and inserting in lieu
thereof "30 per centum of the tenant's adjusted income";
(3) by striking out clause (ii) in the third sentence of subsection
(f)(1) and inserting in lieu thereof the following:
"(ii) to permit the charging of a rental for such dwelling
units at such an amount less than 30 per centum of a
tenant's adjusted income as the Secretary determines repre-
sents a proportionate decrease for the utility charges to be
paid by such tenant, but in no case sheill such rental be lower
than 25 per centum of a tenant's adjusted income.":
(4) by striking out "25 per centum of their income' in para-
graph (2) of subsection (f) and inserting in lieu thereof "30 per
centum of their adjusted income";
(5) by striking out "25 per centum of the tenant's income" in
paragraph (2) of subsection (f) and inserting in lieu thereof "the
highest of the following amounts, rounded to the nearest dollar:
"(A) 30 per centum of the tenant's monthly adjusted
income;
"(B) 10 per centum of the tenant's monthly income; or
"(C) if the family is receiving pajmients for welfare assist-
ance from a public agency and a part of such payments,
adjusted in accordance with the family's actusd housing
costs, is specifically designated by such agency to meet the
family's housing costs, the portion of such pajrments which is
so designated";
(6) by striking out the third sentence in paragraph (2) of
sulDsection (f);
(7) by striking out subparagraph (A) of subsection (f)(3) and
redesignating subsection (f)(3XB) as subsection (f)(3); and
(8) by striking out subsection (m) and inserting in lieu thereof
the following:
"(m) For the purpose of this section the term 'income' means
income from all sources of each member of the household, as
determined in accordance with criteria prescribed by the Secretary.
In determining amounts to be excluded from income, the Secretary
may, in the Secretary's discretion, take into account the number of
minor children in the household and such other factors as the
Secretary may determine are appropriate.".
(g) Section 101 of the Housing and Urban Development Act of 1965 12 use I70is,
is a m e n d e d - 42 use 1451.
(1) by striking out paragraph (2) in subsection (c) and inserting
in lieu thereof the following:
"(2) 'income' means income from all sources of each member of
the household, as determined in accordance with criteria pre-
scribed by the Secretary. In determining amounts to be excluded
from income, the Secretary may, in the Secretary's discretion,
take into account the number of minor children in the household
and such other factors as the Secretary may determine are
appropriate.";
(2) by striking out the first sentence of subsection (d) and
inserting in lieu thereof the following: "The amount of the
annual payment with respect to any dwelling unit shall be the
95 STAT. 404 PUBLIC LAW 97-35—AUG. 13, 1981
lesser of (1) 70 per centum of the fair market rent, or (2) the
amount by which the fair market rental for such unit exceeds 30
per centum of the tenant's adjusted income."; and
(3) by striking out ", except the elderly, at intervals of two
years (or at shorter intervals in cases where the Secretary may
deem it desirable)" in paragraph (2) of subsection (e), and bv
inserting in lieu thereof "no less frequently than annually*.
(h) Title If of the Housing and C!onununity Development Amend-
ments of 1979 is amended—
42 u s e 1437a (1) by striking out subsection (c) in section 202; and
note. (2) by striking out subsection (c) in section 203.
12 u s e 1701s
note. (iXD In determining the rent to be paid by tenants who are
Rent payments, occupying housing assisted under the authorities amended by this
determination. section on the effective date of this Act, the Secretary, notwithstand-
42 u s e 1437a ing any other provision of this section, may provide for delayed
note. applicability, or for staged implementation, of the procedures for
determining rent required by the provisions of subsections (a)
through (h) of this section if the Secretary determines that immediate
application of such procedures would be impracticable, would violate
the terms of existing leases, or would result in extraordinary hard-
ship for any class of tenants. The Secretary shall provide that the
amount of rent paid by any family shall not increase, as a result of
the amendments made by this section and as a result of any other
provision of Federal law redefining which governmental benefits are
required to or may be considered as income, by more than 10 per
centum during any 12-month period unless the increase above such
10 per centum is attributed solely to increases in income which are
not caused by such amendments or by such redefinitions. The
limitation contained in the preceding sentence shall remain in effect
and may not be changed or superceded except by another provision of
law which amends tms subsection. Notwithstanding any other provi-
sion of this section, application of the procedures for determining
rent contained in this section shall not result in a reduction in the
amount of rent paid by any tenant below the amount paid by such
tenant immediately precedmg the effective date of this Act.
(2) Tenants of housing assisted under the provisions of law amend-
ed by this section whose occupancy begins after the effective date of
this Act shall be subject to immediate rent payment determinations
in accordance with the amendments contained in subsections (a)
through (h), except that the Secretary may provide for delayed
applicability, or for staged implementation, of these requirements for
such tenants if the Secretary determines that immediate application
of the requirements of this section would be impracticable, or that
uniform procedures for assessing rents would significantly decrease
administrative costs and burdens.
(3) The Secretary's actions and determinations and the procedures
for making determinations pursuant to this subsection shall not be
reviewable in any court. The provisions of subsections (a) through (h)
shall be implemented and fully applicable to all affected tenants no
later than five years following the date of enactment of this Act,
except that the Secretary may extend the time for implementation if
the Secretary determines that full implementation would result in
extraordinary hardship for any class of tenants.
INCOME EUGIBIUTY
42 u s e 1437 SEC. 323. The United States Housing Act of 1937 is amended by
note. adding at the end thereof the following:
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 405
"INCOME EUGIBIUTY FOR ASSISTED HOUSING
"SEC. 16. (a) Not more than 10 per centum of the dwelling units 42 use I437n.
which were available for occupancy under public housing annual
contributions contracts and section 8 housing assistance payments
contracts under this Act before the effective date of the Housing and
Community Development Amendments of 1981, and which will be Ante. p. 384.
leased on or after such effective date shall be available for leasing by
lower income families other than very low-income families.
"Ot)) Not more than 5 per centimi of the dwelling units which
become available for occupancy under public housing annual contri-
butions contracts and section 8 housing assistance payments con-
tracts under this Act on or after the effective date of the Housing and
Community Development Amendments of 1981 shall be available for
leasing by lower income families other than very low-income fami-
lies.".
COST REDUCTION IN ASSISTED HOUSING
SEC. 324. Section 8 of the United States Housing Act of 1937 is 42 use I437f.
amended—
(1) by inserting after the first sentence of subsection (bX2) the
following: "To increase housing opportunities for very low-
income families, the Secretary shall assure that newly con-
structed housing to be assisted under this section is modest in
design.";
(2) by adding at the end of subsection (cX2) the following: Contract rents,
"(D) Notmthstanding the foregoing, the Secretary shall limit increases,limitation.
increases in contract rents for newly constructed or substantially
rehabilitated projects assisted under this section to the amount of
operating cost increases incurred with respect to comparable rent«d
dwelling units of various sizes and tjrpes in the S£ime market area
which are suitable for occupancy by families assisted under this
section. Where no comparable dwelling units exist in the same
market area, the Secretary shall have authority to approve such
increases in accordance with the best available data regarding
operating cost increases in rental dwelling units."; and
(3) by adding at the end thereof the following:
"(1) After selection of a proposal involving newly constructed or
substantially rehabilitated units for assistance under this section, the
Secretary shall limit cost and rent increases, except for adjustments
in rent pursuant to section 8(c)(2), to those approved by the Secretary.
The Secretary may approve those increases only for unforeseen
factors beyond the owner's control, design chsmges required by the
Secretary or the local government, or changes in financing approved
by the Secretary.
"(m) For the purpose of achieving the lowest cost in providing units
in newly constructed projects assisted under this section, the Secre-
tary shall give a preference in entering ihto contracts under this
section for projects which are to be located on specific tracts of land
provided by States or units of local government if the Secretary
determines that the tract of land is suitable for such housing, and
that affording such preference will be cost effective.
"(n) In msJdng assistance available under subsection (e)(5) and
subsection (i), the Secretary may provide assistance with respect to
residential properties in which some or all of the dwelling units do
not contain bathroom or kitchen facilities, if—
95 STAT. 406 PUBLIC LAW 97-35—AUG. 13, 1981
"(1) the property is located in an area in which there is a
significant demand for such units, as determined by the Secre-
tary; and
(2) the unit of general local government in which the property
is located and the local public housing agency approve of such
units being utilized for such purpose.
Waiver The Secretary may waive, in appropriate cases, the limitation and
preference described in the second and third sentences of section
Ante, p. 400. 3(b)(3) with respect to the assistance made available under this
subsection.".
AID FOR EUGIBLE FAMILIES
42 use I437f. SEC. 325. Section 8 of the United States Housing Act of 1937 is
amended—
(1) by adding at the end of subsection (b)(2) the following: "Each
contract to make assistance payments for newly constructed or
substantially rehabilitated housing assisted under this section
entered into after the date of enactment of the Housing and
Ante, p. 384. Community Development Amendments of 1981 shall provide
that during the term of the contract the owner shall make
available for occupancy by families which are eligible for assist-
ance under this section, at the time of their initial occupancy, the
number of units for which assistance is committed under the
contract."; and
(2) by inserting after "nonhandicapped persons" in the second
sentence of subsection (c)(5) the following: "which are not subject
to mortgages purchased under section 305 of the National Hous-
12 use 1720. ingAct".
MISCELLANEOUS HOUSING ASSISTANCE PROVISIONS
42 u s e 1437f. SEC. 326. (a) Section 8(c) of the United States Housing Act of 1937 is
amended by adding at the end thereof the following:
"(8) Each contract under this section shall provide that the owner
will notify tenants at least 90 days prior to the expiration of the
contract of any rent increase which may occur as a result of the
expiration of such contract.".
Survey. (b)(1) Within one year after the date of enactment of this Act, the
42 u s e 1437f Secretary of Housing and Urban Development shall conduct a survey
note. to determine the number of projects which are assisted under section
8 of the United States Housing Act of 1937 and are owned by
developers or sponsors with five-year annual contributions contracts
who plan to withdraw from the section 8 program when their
contracts expire and who will increase rents in those projects to levels
that the current residents of those projects will not be able to afford.
Where such survey indicates that an owner intends to withdraw from
the program, the Secretary shall notify affected residents of possible
rent increases.
Report to (2) Not later than one year after the date of the enactment of this
eongress. Act, the Secretary shall transmit to the Congress a report indicating
alternative methods which may be utilized for recapturing the cost to
the Federal Government of front-end investment in those units which
are removed from the section 8 program.
Regulations. (c) The Secretary of Housing and Urban Development, after consul-
42 u s e 1437f tation with the Attorney General, shall develop regulations to pre-
note.
vent possible conflicts of interest on the part of Federal, State, and
local government officials with regard to participation in projects
assisted under section 8 of the United States Housing Act of 1937, and
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 407
shall make such r^ulations effective not later than 180 days after
the date of enactment of this Act.
(dXD The Secretary of Housing and Urban Development shall 42 u s e 1437f
permit public housing agencies to retain, out of judgments obtained note.
by them in recovering amounts wrongfully paid as a result of fraud
and abuse in the housing assistance program under section 8 of the
United States Housing Act of 1937, an amoimt equal to the greater of 42 u s e 1437f.
(A) the legal expenses incurred in obtaining such judgments, or (B) 50
per centum of the amount actually collected on the judgments.
(2) The Secretary of Housing and Urban Development shall include
in the annual report under section 8 of the Department of Housing
and Urban Development Act a summary of cases brought to ite
attention by public housing authorities for prosecution or civil action,
and shall describe the handling of such cases by such authorities and
by the Department of Housing and Urban Development and the
resolution of such cases in the court system.
(e)(1) Section 8(dXlXB) of the United States Housing Act of 1937 is
amended to read as follows:
"(BXi) the lease between the tenant and the owner shall be for
at least one year or the term of such contract, whichever is
shorter, and shall contain other terms and conditions specified
by the Secretary; and
"(ii) the owner shall not terminate the tenancy except for
serious or repeated violation of the terms and conditions of the
lease, for violation of applicable Federal, State, or local law, or
for other good cause;".
(2) The amendment made by paragraph (1) shall apply with respect 42 u s e 1437f
to leases entered into on or after October 1,1981. note.
RENT SUPPLEMENTS
SEC. 327. (a) Section 101(1) of the Housing and Urban Development
Act of 1965 is amended to read as follows: 12 u s e 1701s.
"(1) Notwithstanding the provisions of subsection (a) and any other
provision of law, the Secretary may utilize additional authority under
section 5(c) of the United States Housing Act of 1937 made available 94 Stat. 1624.
by appropriation Acts on or after October 1, 1979, to supplement 42 u s e 1437c.
assistance authority available imder this section.".
(b) The second sentence of section 101(d) of such Act is repealed.
SECTION 235 AMENDMENTS
SEC. 328. (a) Section 235(cX2XA) of the National Housing Act is 94 Stat. 1630.
amended by striking out "ceases for a period of 90 continuous days or 12 u s e 1715z.
more makmg payments required under the mortgage, loan, or ad-
vance of credit secured by such a property, or".
(b) Section 235(hXl) of such Act is amended by adding the following
new sentences at the end thereof: "The Secretary shall not enter into
new contracts for assistance payments under this section after March
31,1982, except pursuant to a firm commitment issued on or before
March 31, 1982, or pursuant to other commitments issued by the
Secretary prior to June 30, 1981, reserving funds for housing to be
assisted imder this section where such housing is included in a project
pursuant to section 119 of the Housing and Community Development
Act of 1974. In no event may the Secretary enter into any new 42 use 5318
contract for assistance payments under this section after September
30,1983.".
89-194 O—82 28:QL3
95 STAT. 408 PUBLIC LAW 97-35—AUG. 13, 1981
94 Stat. 1631. (c) Section 235(q)(14) of such Act is amended by striking out "ceases
12 use 1715z. for a period of 90 continuous days or more making payments on the
mortgage, loan, or advance of credit secured by the property, or".
RESTRICTION ON USE OF ASSISTED HOUSING
SEC. 329. (a) Section 214 of the Housing and Community Develop-
94 Stat. 1637. ment Act of 1980 is amended to read as follows:
42 u s e 1436a.
"RESTRICTION O N U S E O P ASSISTED HOUSING
Resident aliens. "SEC. 214. (a) Notwithstanding any other provision of law, the
Secretary of Housing and Urban Development may not make finan-
cial assistance available for the benefit of any alien unless that alien
is a resident of the United States and is—
"(1) an alien lawfully admitted for permanent residence as an
immigrant as defined by sections 101(a)(15) and 101(aX20) of the
Immigration and Nationality Act (8 U.S.C. 1101(a)(15) and 8
U.S.C. 1101(a)(20)), excluding, among others, alien visitors, tour-
ists, diplomats, and students who enter the United States tempo-
rarily with no intention of abandoning their residence in a
foreign country;
"(2) an alien who entered the United States prior to June 30,
1948, or such subsequent date as is enacted by law, has continu-
ously maintained his or her residence in the United States since
then, and is not ineligible for citizenship, but who is deemed to be
lawfully admitted for permanent residence as a result of an
exercise of discretion by the Attorney General pursuant to
section 249 of the Immigration and Nationality Act (8 U.S.C.
1259);
"(3) an alien who is lawfully present in the United States
pursuant to an admission under section 207 of the Immigration
94 Stat. 103. and Nationality Act (8 U.S.C. 1157) or pursuant to the granting of
asylum (which has not been terminated) under section 208 of
94 Stat. 105. such Act (8 U.S.C. 1158);
"(4) an alien who is lawfully present in the United States as a
result of an exercise of discretion by the Attorney General for
emergent reasons or reasons deemed strictly in the public inter-
est pursuant to section 212(d)(5) of the Immigration and Nation-
94 Stat. 107. ality Act (8 U.S.C. 1182(d)(5)); or
"(5) an alien who is lawfully present in the United States as a
result of the Attorney General's withholding deportation pursu-
ant to section 243(h) of the Immigration and Nationality Act (8
94 Stat. 107. U.S.C. 1253(h)).
"Financial "(b) For purposes of this section the term 'financial assistance'
assistance." means financial assistance made available pursuant to the United
42 u s e 1437 States Housing Act of 1937, section 235 or 236 of the National
note. Housing Act, or section 101 of the Housing and Urban Development
12 u s e 1715z,
1715Z-1. Act of 1965.".
12 u s e 1701s, (b) An alien who is lawfully present in the United States as a result
42 u s e 1451. of being granted conditional entry pursuant to section 203(a)(7) of the
42 u s e 1436a Immigration and Nationalilty Act (8 U.S.C. 1153(a)(7)) before April 1,
note. 1980, because of persecution or fear of persecution on account of race,
94 Stat. 107.
religion, or political opinion or because of being uprooted by cata-
strophic natural calamity shall be deemed, for purposes of section 214
of the Housing and Community Development Act of 1980, to be an
Supra. alien described in section 214(a)(3) of such Act.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 409
PAYMENT FOR DEVELOPMENT MANAGERS
SEC. 329A. The Secretary of Housing and Urban Development shall 42 use I437j-i.
develop and implement a revised fee schedule for development
managers of lower income housing projects assisted under the United
States Housing Act of 1987 so that the percentage limitation applica- 42 u s e 1437
ble to fees chargeable in connection with smaller projects is increased note.
to a minimum level which is practicable.
REVIEW OF OPERATING SUBSIDY FORMULA
SEC. 329B. The Secretary of Housing and Urban Development shall
review the administration of the operating subsidy program under
section 9 of the United States Housing Act of 1937, including an 42 use I437g.
examination of alternative methods for distributing operating subsi-
dies which provide incentives for efficient management, full rent
collection, and improved maintenance of projects developed under
the United States Housing Act of 1937. Not later than March 1,1982, Report to
the Secretary of Housing and Urban Development shall transmit a eongress.
report to the Congress on the results of such review.
ENERGY EFFICIENCY EFFORTS
SEC. 329C. Section 201 of the Housing and Community Develop-
ment Amendments of 1978 is amended— 12 use
(1) in subsection (fXD, by striking out "and" at the end of 1715z-la.
subparagraph (B), by striking out the period at the end of
subparagraph (C) and inserting in lieu thereof "; and", and by
adding at the end thereof the following:
"(D) an amount determined by the Secretary to be neces-
sary to carry out a plan to upgrade the project to meet cost-
effective energy efficiency standards prescribed by the Sec-
retary."; and
(2) by inserting after subsection (h) the following:
"(i) Notwithstanding any other provision of law, in exercising any
authority relating to the approval or disapproval of rentals charged
tenants residing in projects which are eligible for assistance under
this section, the Secretary—
"(1) shall consider whether the mortgagor could control in-
creases in utility costs by securing more favorable utility rates,
by undertaking energy conservation measures which are finan-
cially feasible and cost effective, or by taking other financially
feasible and cost-effective actions to increase energy efficiency or
to reduce energy consumption; and
"(2) may, in his discretion, adjust the amount of a proposed
rental increase where he finds the mortgagor could exercise such
control.".
RECOGNITION OF KANSAS DEPARTMENT OP ECONOMIC DEVELOPMENT
SEC. 329D. The Secretary of Housing and Urban Development shall
permit the Kansas Department of Economic Development to partici-
pate as a public housing agency for the purposes of programs carried
out under the United States Housing Act of 1937 and as a State 42 u s e 1437
agency for the purpose of section 883.203 of title 24 of the Code of note.
Federal Regulations as in effect June 1,1981.
95 STAT. 410 PUBLIC LAW 97-35—AUG. 13, 1981
PURCHASE OF PHA OBLIGATIONS
12 u s e 2294a. SEC. 329E. In addition to any authority provided before October 1,
1981, the Secretary of Housing and Urban Development may, on and
after October 1, 1981, enter into contracts for periodic payments to
the Federal Financing Bank to offset the costs to the Bank of
purchasing obligations (as described in the first sentence of section
12 u s e 2294. 16(b) of the Federal Financing Bank Act of 1973) issued by local public
housing agencies for purposes of financing public housing projects
94 Stat. 1624. authorized by section 5(c) of the United States Housing Act of 1937.
42 u s e 1437c. Notwithstanding any other provision of law, such contracts may be
entered into only to the extent approved in appropriation Acts, and
the aggregate amount which may be obligated over the duration of
such contracts may not exceed $400,000,000. There are hereby au-
thorized to be appropriated any amounts necessary to provide for
such payments. The authority to enter into contracts under this
subsection shall be in lieu of any authority (except for authority
provided specifically to the Secretary before October 1, 1981) of the
Secretary to enter into contracts for such purposes under section
16(b) of the Federal Financing Bank Act of 1973.
TENANT PARTICIPATION
SEC. 329F. Section 202(b)(1) of the Housing and Communitv Devel-
12 use opment Amendments of 1978 is amended by striking out owner's
1715z-lb. action" and inserting in lieu thereof "owner's request for rent
increase, conversion of residential rental units to any other use
(including commercial use or use as a unit in any condominium or
cooperative project), partial release of security, or major physiced
alterations".
FIRE S A F E T Y
94 Stat. 1625. SEC. 329G. Section 14(i)(l) of the United States Housing Act of 1937
42 u s e 1437/. is amended by inserting the following before the period at the end of
the first sentence thereof: ", especially emergency and special pur-
pose needs which relate to fire safety standards".
SECTION 8 ASSISTANCE FOR MANUFACTURED HOMES
Contracts. SEC. 329H. (a) Section 8(j) of the United States Housing Act of 1937
42 u s e 1437f. is amended to read as follows:
"(j)(l) The Secretary may enter into contracts to make assistance
payments under this subsection to assist lower income families by
making rental assistance payments on behalf of any such family
which utilizes a manufactured home as its principal place of resi-
dence. Such payments may be made with respect to the rental of the
real property on which there is located a manufactured home which
is owned by any such family or with respect to the rental by such
family of a manufactured home and the real property on which it is
located. In carrying out this subsection, the Secretary may—
"(A) enter into annual contributions contracts with public
housing agencies pursuant to which such agencies may enter into
contracts to make such assistance pa3rments to the owners of
such real property, or
"(B) enter into such contracts directly with the owners of such
real property.
Maximum "(2)(A) A contract entered into pursuant to this paragraph shall
monthly establish the maximum monthly rent (including maintenance and
rent.
management charges) which the owner is entitled to receive for the
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 411
space on which a manufactured home is located and with respect to
which assistance payments are to be made. The maximum monthly
rent shall not exceed by more than 10 per centum the fair market
rental established by the Secretary periodically (but not less than
annually) with respect to the market area for the rental of real
property suitable for occupancy by families assisted under this
paragraph.
"(B) The amount of any monthly assistance payment with respect
to any family which rents real property which is assisted under this
paragraph, and on which is located a manufactured home which is
owned by such family shall be the difference between the rent the
family is required to pay under section 3(a) of this Act and the sum 42 USC I437a.
of—
"(i) the monthly payment made by such family to amortize the
cost of purchasing the manufactured home;
"(ii) the monthly utility payments made by such family,
subject to reasonable limitations prescribed by the Secretary;
and
"(iii) the maximum monthly rent permitted with respect to the
real property which is rented by such family for the purpose of
locating its manufactured home;
except that in no case may such assistance exceed the total amount of
such maximum monthly rent.
"(3)(A) Contracts entered into pursuant to this paragraph shall Maximum
establish the maximum monthly rent permitted with respect to the monthly
manufactured home and the real property on which it is located and rent.
with respect to which assistance payments are to be made. The
maximum monthly, rent shall not exceed by more than 10 per centum
the fair market rental established by the Secretary periodically (but
not less than annually) with respect to the market area for the rental
of a manufactured home and the real property on which it is located
suitable for occupancy by families assisted under this paragraph,
except that the maximum monthly rent may exceed the fair market
rental by more than 10 but not more than 20 per centum where the
Secretary determines that special circumstances warrant such
higher maximum rent.
"(B) The amount of any monthly assistance payment with respect
to any family which rents a manufactured home and the real
property on which it is located and which is assisted under this
paragraph shall be the difference between the rent the family is
required to pay under section 3(a) of this Act and the sum of^
"(i) the monthly utility payments made by such family, subject
to reeisonable limitations prescribed by the Secretary; and
"(ii) the maximum monthly rent permitted with respect to the
manufactured home and the real property on which it is located.
"(4) The provisions of subsection (cX2) of this section shall apply to
the adjustments of maximum monthly rents under this subsection.
"(5) Each contract entered into under this subsection shall be for a Contract terms.
term of not less than one month and not more than 180 months,
except that in any case in which the manufactured home park is
substantially rehabilitated or newly constructed, such term may not
be less than 240 months, nor more than the maximum term for a
manufactured home loan permitted under section 2(b) of the National
Housing Act. Post, p. 414.
"(6) The Secretary may carry out this subsection without regard to
whether the manufactured home park is existing, substantially
rehabilitated, or newly constructed.
95 STAT. 412 PUBLIC LAW 97-35—AUG. 13, 1981
"(7) In the case of any substantially rehabilitated or newly con-
structed manufactured home park containing spaces with respect to
which assistance is made under this subsection, the principal amount
of the mortgage attributable to the rental spaces within the park may
not exceed an amount established by the Secretary which is equal to
or less than the limitation for manufactured home parks descrioed in
Post, p. 416. section 207(cX3) of the National Housing Act, and the Secretanr may
increase such limitation in high cost areas in the manner described in
such section.
"(8) The Secretary may prescribe other terms and conditions which
are necessary for tne purpose of carrying out the provisions of this
subsection and which are consistent with the purposes of this
subsection.".
HOMEOWNERSHIP AND FIRE SAFETY STUDIES
SEC. 3291. (aXD The Secretary of Housing and Urban Development
shall conduct a study of—-
(A) the extent, if any, to which section 8(cX7) of the United
42 use i437f. States Housing Act of 1937 has been utilized;
(B) the results of any such utilization;
(C) if such section has not been utilized or utilized only on a
very restricted basis, the reasons why it has not been utilized
more extensively; and
(D) different methods by which such section could be utilized
for increasing homeownership opportunities for lower income
families.
Recommenda- (2) As a result of such study, the Secretary shall, not later than
tions, January 1,1982, transmit to the Congress recommendations regard-
transmittal to
Congress. ing the establishment of a demonstration project in which the
Secretary would use section 8(cX7) of such Act for the purpose of
increasing homeownership opportunities for lower income families.
Such proposal shall include, but not be limited to, provisions for—
(A) targeting such project so that existing housing may be
preserved to the maximum extent practicable; and
(B) recovering assistance in the case of resale of the property or
in other appropriate cases.
Report to (b) The Secretary shall conduct a study to the extent to which lower
Congress. income housing projects do not meet applicable fire safety standards
and report to the Congress with respect to such study not later than
one year after the date of the enactment of this Act.
PART 3—PROGRAM AMENDMENTS AND EXTENSIONS
FEDERAL HOUSING ADMINISTRATION EXTENSIONS
94 Stat. 1638. SEC. 331. (a) Section 2(a) of the National Housing Act is amended by
12 u s e 1703. striking out "October 1, 1981" in the first sentence and inserting in
lieu thereof "October 1,1982".
12 u s e 1715h. Ot>) Section 217 of such Act is amended by striking out "September
30,1981" and inserting in lieu thereof "September 30,1982".
12 u s e 1715i. (c) Section 221(f) of such Act is amended by striking out "September
30,1981" in the fifth sentence and inserting in lieu thereof Septem-
ber 30,1982".
12 0 ^ ltl54. (dXD Section 235(m) of such Act is amended by striking out
"September 30, 1981" and inserting in lieu thereof "September 30,
1982".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 413
(2) Section 235(q)(l) of such Act is amended by striking out "June 1, 94 Stat. 1631.
1981," in the fourth sentence thereof and inserting in lieu thereof 12 u s e 1715z.
"September 30,1982,".
(e) Section 236(n) of such Act is amended by striking out "Septem- 94 Stat. 1638.
ber 30, 1981" and inserting in Heu thereof "September 30, 1982". 12 u s e 1715Z-1.
(f) Section 244(d) of such Act is amended— 12 u s e 1715Z-9.
(1) by striking out "September 30,1981" in the first sentence
and inserting in lieu thereof "September 30,1982"; and
(2) by striking out "October 1,1981" in the second sentence and
inserting in lieu thereof "October 1,1982".
(g) Section 245(a) of such Act is amended by striking out "Septem- 12 use
ber 30, 1981" and inserting in lieu thereof "September 30, 1982". 1715Z-10.
(h)(1) Section 809(f) of such Act is amended by striking out "Septem- 12 u s e 1748h-l.
ber 30, 1981" in the second sentence and inserting in lieu thereof
"September 30,1982".
(2) Section 810(k) of such Act is amended by striking out "Septem- 94 Stat. 1639.
ber 30, 1981" in the second sentence and inserting in lieu thereof 12 u s e 1748h-2.
"September 30,1982".
(i) Section 1002(a) of such Act is amended by striking out "Septem- 12 u s e 1749bb.
ber 30, 1981" in the second sentence and inserting in lieu thereof
"September 30,1982".
(j) Section 1101(a) of such Act is amended by striking out "Septem- 12 u s e 1749aaa.
ber 30, 1981" in the second sentence and inserting in lieu thereof
"September 30,1982".
FLEXIBLE INTEREST RATES
SEC. 332. Section 3(a)(1) of Public Law 90-301 is amended by striking 94 Stat. 1639.
out "October 1,1981" and inserting in lieu thereof "October 1,1982'" 12 u s e 1709-1.
GOVERNMENT NATIONAL MORTGAGE ASSOCIATION
SEC. 333. (a)(1) Section 305(c) of the Federal National Mortgage
Association Charter Act is amended— 12 u s e 1720.
(A) by striking out "and" after "1978,"; and
(B) by inserting the following before the period at the end
thereof:", and by $1,100,000,000 on October 1,1981".
(2) Section 305 of such Act is amended by adding the following new
subsection at the end thereof:
"(k) During fiscal year 1982, the Association may not enter into Mortgage
commitments to purchase under this section mortg£^es with an purchases.
aggregate principal amount in excess of $1,973,000,000, except that
the Association may not enter into commitments to purchase mort-
gages secured by projects which do not contain units assisted under
section 8 of the United States Housing Act of 1937 with an aggregate 42 u s e 1437f.
principal amount in excess of $580,000,000.".
(3) Section 306(g) of such Act is amended— 12 u s e 1721.
(A) by inserting "(1)" after "(g)";
(B) by striking out "(1)" and "(2)" in the first sentence and
inserting in lieu thereof "(i)" and "(ii)", respectively; and
(C) by adding the following new paragraph at the end thereof:
"(2) During fiscal year 1982, the Association may not enter into
commitments to issue guarantees under this subsection in an aggre-
gate amount in excess of $69,542,000,000.".
(bXD In entering into commitments to purchase below-market, 12 u s e 1720
tandem plan mortgages during the period beginning on the date of note.
the enactment of this Act and ending October 1,1982, under section
305 of the Federal National Mortgage Association Charter Act, the
95 STAT. 414 PUBLIC LAW 97-35—AUG. 13, 1981
Government National Mortgage Association may enter into such
commitments only with respect to multifamily projects for which
firm commitments for mortgage insurance under title II of the
12 use 1707. National Housing Act have been issued.
(2) The Secretary of Housing and Urban Development shall con-
tinue to process applications for mortgage insurance for multifamily
projects under title II of the National Housing Act for a period of at
least 90 days beginning on October 1,1981.
GENERAL INSURANCE FUND
94 Stat. 1639. SEC. 334. Section 519(f) of the National Housing Act is amended by
12 u s e 1735c. inserting the following before the period at the end thereof: ", which
amount shall be increased by $126,673,000 on October 1, 1981".
UMITATION ON INSURANCE AUTHORITY
SEC. 335. Title V of the National Housing Act is amended by adding
the following new section at the end thereof:
"UMITATION ON INSURANCE AUTHORITY
12 use i735f-9. "SEC. 531. During fiscal year 1982, the Secretary may not enter into
commitments to insure under this Act loans and mortgages with an
aggregate principal amount in excess of $41,000,000,000.".
HOUSING FOR THE ELDERLY
12 use l70iq. SEC. 336. Section 202(a)(4XC) of the Housing Act of 1959 is amended
by inserting the following before the period at the end of the second
sentence: , and not more than $850,848,000 may be approved in
appropriation Acts for such loans with respect to fiscal year 1982".
RESEARCH AUTHORIZATIONS
SEC. 337. The second sentence of section 501 of the Housing and
94 Stat. 1639. Urban Development Act of 1970 is amended bv striking out "and not
12 use to exceed $51,000,000 for the fiscal year 1981 and inserting in lieu
1701Z-1.
thereof "not to exceed $51,000,000 for the fiscal year 1981, and not to
exceed $35,000,000 for the fiscal year 1982".
PROPERTY IMPROVEMENT AND MANUFACTURED HOME LOANS
Insurance to SEC. 338. (a) Section 2(b) of the National Housing Act is amended to
financial institu- read as follows:
tions.
12 u s e 1703. "(b)(1) No insurance shall be granted under this section to any such
financial institution with respect to any obligation representing any
such loan, advance of credit, or purchase by it if the amoimt of such
loan, advance of credit, or purchase exceeds—
"(A) $17,500 ($20,000 where financing the installation of a solar
energy system is involved) if made for the purpose of financing
alterations, repairs and improvements upon or in connection
with existing single-family structures or manufactured homes;
"(B) $43,750 or an average amount of $8,750 per family unit
($50,000 and $10,000, respectively, where financing the installa-
tion of a solar energy system is involved) if made for the purpose
of financing the alteration, repair, improvement, or conversion of
an existing structure used or to be used as an apartment house or
a dwelling for two or more families;
PUBLIC LAW 97-35—AUG. 13,1981 95 STAT. 415
"(C) $22,500 ($35,000 in the case of a manufactured home
composed of two or more modules) if made for the purpose of
financing the purchase of a manufactured home;
"(D) $35,000 ($47,500 in the case of a manufactured home
composed of two or more modules) if made for the purpose of
financing the purchase of a manufactured home and a suitably
developed lot on which to place the home;
"(E) such an amount as may be necessary, but not exceeding
$12,500, if made for the purpose of financing the purchase, by an
owner of a manufactured home which is the principal residence
of that owner, of a suitably developed lot on which to place that
manufactured home, and if the owner certifies that he or she will
place the manufactured home on the lot acquired with such loan
within six months after the date of such loan;
"(F) $15,000 per family unit if made for the purpose of financ-
ing the preservation of an historic structure; and
(G) such principal amount as the Secretary may prescribe if
made for the purpose of financing fire safety equipment for a
nursing home, extended health care facility, intermediate health
care facility, or other comparable health care facility.
"(2) Because of prevailing higher costs, the Secretary may, by
regulation, in Alaska, Guam, or Hawaii, increase any dollar amount
limitation on manufactured homes or manufactured, home lot loans
contained in this subsection by not to exceed 40 per centum. In other
areas where needed to meet higher costs of land acquisition, site
development, and construction of a permanent foundation in connec-
tion with the purchase of a manufactured home or lot, the Secretary
may, by regulation, increase any dollar amount limitation otherwise
applicable by an additional $7,500.
(3) No insurance shall be granted under this section to any such
financial institution with respect to any obligation representing any
such loan, advance of credit, or purchase by it if the term to maturity
of such loan, advance of credit or purchase exceeds—
"(A) fifteen years and thirty-two days if made for the purpose
of financing alterations, repairs, and improvements upon or in
connection with an existing single-family structure or manufac-
tured home;
"(B) fifteen years and thirty-two days if made for the purpose of
financing the alteration, repair, improvement or conversion of
an existing structure used or to be used as an apartment house or
a dwelling for two or more families;
"(C) twenty years and thirty-two days (twenty-three years and
thirty-two days in the case of a manufactured home composed of
two or more modules) if made for the purpose of financing the
purchase of a manufactured home;
"(D) twenty years and thirty-two days (twenty-five years and
thirty-two days in the case of a manufactured home composed of
two or more modules) if made for the purpose of financing the
purchase of a manufactured home and a suitably developed lot
on which to place the home;
"(E) fifteen years and thirty-two days if made for the purpose of
financing the purchase, by the owner of a manufactured home
which is the principal residence of that owner, of a suitably
developed lot on which to place that manufactured home;
"(F) fifteen years and thirty-two days if made for the purpose of
financing the preservation of an historic structure;
"(G) such term to maturity as the Secretary may prescribe if
made for the purpose of financing the construction of a new
95 STAT. 416 PUBLIC LAW 97-35—AUG. 13, 1981
structure for use in whole or in part for agricultural purposes;
and
"(H) such term to maturity as the Secretary may prescribe if
made for the purpose of financing fire safety equipment for a
nursing home, extended health care facility, intermediate health
care facility, or other comparable health care facility.
"(4) For the purpose of this subsection—
"(A) the term 'developed lot' includes an interest in a condo-
minium project (including any interest in the common areas) or a
share in a cooperative association;
"(B) a loan to finance the purchase of a manufactured home or
a manufactured home and lot may also finance the purchase of a
garage, patio, carport, or other comparable appurtenance; and
"(C) a loan to finance the purchase of a manufactured home or
a manufactured home and lot shall be secured by a first lien upon
such home or home and lot, its furnishings, equipment, accesso-
ries, and appurtenances.
"(5) No insurance shall be granted under this section to any such
financial institution with respect to any obligation representing any
such loan, advance of credit, or purchase by it unless the obligation
bears such interest, has such maturity, and contains such other
terms, conditions, and restrictions as the Secretary shall prescribe, in
order to make credit available for the purpose of this title. Any such
obligation with respect to which insurance is granted under this
section shall bear interest and insurance premium charges not
exceeding (A) an amount, with respect to so much of the net proceeds
thereof as does not exceed $2,500, equivalent to $5.50 discount per
$100 of original face amount of a one-year note payable in equal
monthly installments, plus (B) an amount, with respect to any
portion of the net proceeds thereof in excess of $2,500, equivalent to
$4.50 discount per $100 of original face amount of such note. The
amounts referred to in clauses (A) and (B) of the preceding sentence,
when correctly based on tables of calculations issued by the Secretary
or adjusted to eliminate minor errors in computation in accordance
with requirements of the Secretary, shall be deemed to comply with
such sentence.
Refinancing. "(6)(A) Any obligation with respect to which insurance is granted
under this section may be refinanced and extended in accordance
with such terms and conditions as the Secretary may prescribe, but in
no event for an additional amount or term in excess of any applicable
maximum provided for in this subsection.
"(B) The owner of a manufactured home lot purchased without
assistance under this section but otherwise meeting the requirements
of this section may refinance such lot under this section in connection
with the purchase of a manufactured home if the borrower certifies
that the home and lot is or will be his or her principal residence
within six months after the date of the loan.".
94 Stat. 1641. (b) Section 207(c)(8) of the National Housing Act is amended by
12 use 1713. striking out "$8,000" and inserting in lieu thereof "$9,000".
MORTGAGE INSURANCE FOR CONDOMINIUMS
SEC. 339. (a) The first sentence of section 2340t)) of the National
12 use I7l5y. Housing Act is amended by inserting ", including a project in which
the dwelling units are attached, semi-attached, or detached," after
"multifamily project".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 417
HOUSING COUNSELING
SEC. 339 A. Section 106(a)(3) of the Housing and Urban Development
Act of 1968 is amended by inserting the following before the period at 12 USC I701x.
the end of the first sentence: "; except that for the fiscal year 1982,
there are authorized to be appropriated not to exceed $4,000,000 for
such purposes".
TECHNICAL AMENDMENTS
SEC. 339B. (a) The last sentence of section 207(c)(3), section 213(p),
the last proviso in section 220(d)(3)(B)(iii), section 221(k), the proviso
in section 231(c)(2), and section 234(j) of the National Housing Act are 12 USC 1713,
amended— 1715e, 1715k,
1715/, 1715v,
(1) by inserting "therein" immediately after "installation" 1715y.
wherever it appears; and
(2) by striking out "therein" before the punctuation at the end
thereof.
(b) Section 223(f) of such Act is amended— 94 Stat. 1650.
12 USC 1715n.
(1) by inserting "and" immediately after the semicolon at the
end of paragraph (2)(A); and
(2) by redesignating paragraph (5) as paragraph (4).
(c) For purposes of paragraphs (1) and (4) of section 308(c) of the Definitions.
94 Stat. 1640.
Housing and Community Development Act of 1980, the term "mobile 12 USC 1701
home" and the term "manufactured home" shall be deemed to et seq., 5401 et
include the term "mobile homes" and the term "manufactured seq.
homes", respectively.
(d)(1) The material preceding the proviso in clause (2) of the first
sentence of section 234(c) of the National Housing Act is amended to 12 USC 1715y.
read as follows: "(2) the project is or has been covered by a mortgage
insured under any section (except section 213(a) (1) and (2)) of this Act 12 USC 1715e.
or the project was approved for a guarantee, insurance, or a direct
loan under chapter 37 of title 38, United States Code, notwith- 38 USC 1801 et
standing any requirements in any such section that the project be seq.
constructed or rehabilitated for the purpose of providing rental
housing:".
(2) Section 318 of the Housing and Community Development Act of Repeal.
1980 is repealed. 94 Stat. 1646.
LOWER COST TECHNOLOGY
SEC. 339C. The Secretary of Housing and Urban Development is 12 USC
authorized to develop and implement a demonstration program 1701Z-14.
utilizing lower cost building technology for projects located on inner-
city vacant land.
REDUCTION OF 1981 AUTHORITY
SEC. 339D. (a) Notwithstanding any other provision of law, the
authorizations for appropriations for programs and activities admin-
istered by the Secretary for Housing and Urban Development in
fiscal year 1981 are reduced by $5,359,000,000.
(b) This section takes effect upon the date of enactment of this Act. Effective date.
NATIONAL INSTITUTE OF BUILDING SCIENCES
SEC. 339E. (a) Section 809(h) of the Housing and Community
Development Act of 1974 is amended by striking out "through 1982 12 USC i70lj-2.
(with" and inserting in lieu thereof "through 1984 (with not more
than $500,000 to be appropriated for each of the fiscal years 1982,
1983, and 1984 and with^'.
95 STAT. 418 PUBLIC LAW 97-35—AUG. 13, 1981
12 use 1701J-2. (b) Section 809(cX4) of such Act is amended by inserting the
following before the period at the end thereof: "; except that,
notwithstanding any such rules and procedures as may be adopted by
the Institute, the President of the United States, by and with the
advice and consent of the Senate, shall appoint, as representative of
the public interest, two of the members of the Board of Directors
selected each year for terms commencing in that year".
NEW COMMUNITIES
SEC. 389F. Section 717(b) of the National Urban Policy and New
42 u s e 4518. Community Development Act of 1970 is amended by adding the
following new sentence at the end thereof: "With respect to fiscal
year 1982, the Secretary may not issue obligations under this section
in an aggregate amount in excess of $33,250,000.".
PURCHASER-BROKER ARRANGEMENT
SEC. 339G. Title V of the National Housing Act is amended by
adding the following new section at the end thereof:
PURCHASER-BROKER ARRANGEMENT
12 u s e 1735f-10. "SEC. 532. In carrying out the provisions of title II of this Act with
12 u s e 1707. respect to insuring mortgages secured by a one- to four-family
residence, the Secretary may not exclude from the principal amount
which may be insured under such title any sum solely on the basis
that such sum is to be paid by the purchaser to a broker who has been
the purchaser's agent in the purchase of the residence, but the
principal amount of the mortgage, when such sum is added, shall not
exceed the limitation as to maximum mortgage amount provided in
title II.".
MORTGAGE INSURANCE FOR HOSPITALS
12 u s e 1715Z-7. SEC. 339H. Section 242(dX5) of the National Housing Act is
amended by adding at the end thereof the following: "This paragraph
shall not limit the authoritj^ of the Secretary to approve a mortgage
increase on any mortgage eligible for insurance under this paragraph
at any time prior to final endorsement of the loan for insurance;
except that such mortgage increase may not be approved for the cost
of constructing any improvements not included in the original plans
and specifications approved by the Department of Health and
Human Services unless approved by the Secretary of Housing and
Urban Development and by the Secretary of Health and Human
Services.".
PART 4-FLOOD, CRIME, AND RIOT INSURANCE
FLOOD INSURANCE
SEC. 341. (a) Section 1376(c) of the National Flood Insurance Act of
94 Stat. 1639. 1968 is amended—
42 u s e 4127. (1) by Striking out "and" after "1980,"; and
(2) by inserting the following before the period at the end
thereof ", and not to exceed $42,600,000 for the fiscal year 1982".
42 u s e 4026. 03)(1) Section 1319 of the National Flood Insurance Act of 1968 is
amended by striking out "September 30,1981" and inserting in lieu
thereof "September 30,1982".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 419
(2) Section 1336(a) of such Act is amended by striking out "Septem- 42 use 4056.
ber 30, 1981" and inserting in lieu thereof "September 30, 1982".
(cXD Section 1310(a) of such Act is amended by inserting "as 42 u s e 4017.
described in subsection (f)" after "which shall be available".
(2) Section 1310 of such Act is amended by adding the following new
subsection at the end thereof :
if) The fund shall be available, with respect to any fiscal year
beginning on or after October 1,1981, only to the extent approved in
appropriation Acts; except that the fund shall be available for the
purnose described in subsection (dXD without such approval.".
(cD(l) Chapter I of such Act is amended by adding the following new
section at the end thereof:
UNDEVELOPED COASTAL BARRIERS
"SEC. 1321. (a) No new flood insurance coverage shall be provided 42 u s e 4028.
under this title on or aiter October 1,1983, for any new construction
or substeuitial improvements of structures located on undeveloped
coastal barriers which shall be designated by the Secretary of the
Interior.
"(b) For purposes of this section—
"(1) the term 'coastal barrier* means— "eoastal
"(A) a depositional geolc^c feature (such as a bay barrier, barrier."
tombolo, barrier spit, or beurier islemd) which—
"(i) consists of unconsolidated sedimentary materials,
"(ii) is subject to wave, tidal, and wind energies, and
"(iii) protects landward aquatic habitats from direct
wave attack; and
"(B) all associated aquatic habitats including the adjacent
wetlands, marshes, estuaries, inlets, and nearshore waters;
"(2) a coastal barrier or any portion thereof shall be treated as
an undeveloped coastal barrier for purposes of subsection (a) only
if there are few manmade structures on the barrier or portion
thereof and these structures and man's activities on the barrier
do not significemtly impede geomorphic and ecological processes;
and
"(3) a coastal barrier which is included within the boundaries
of an area established under Federal, State, or local law, or held
by a qualified organization as defined in section 170(h)(3) of the
Internal Revenue Code of 1954, primarily for wildlife refuge, 26 u s e 170.
sanctuary, recreational, or natural resource conservation pur-
poses shall not be designated as an undeveloped coastal barrier
for purposes of subsection (a).
"(c) A federally insured financial institution may make loans
secured by structures which are not eligible forfloodinsurance under
this title by reason of subsection (a).".
(2) The Secretary of the Interior shall conduct a study for the Study.
purpose of designating the undeveloped coastal barriers which will be 42 u s e 4028
affected by the amendment made by paragraph (1). Not later than note.
Report to
one year after the date of enactment of this Act, the Secretary shall eongress.
transmit to the Congress a report of the findings and conclusions of
such study together with a proposed designation of the undeveloped
coastal barriers and any recommendation regarding the definition of
the term "coastal barrier" as enacted by such amendment.
(e) Section 1345 of such Act is amended by adding at the end thereof 42 u s e 4081.
the following:
"(c) The Director of the Federal Emergency Management Agency
shall hold any agent or broker selling or undert^ing to sell flood
95 STAT. 420 PUBLIC LAW 97-35—AUG. 13, 1981
insurance under this title harmless from any judgment for damages
against such agent or broker as a result of any court action by a
policyholder or applicant arising out of an error or omission on the
part of the Federal Emergency Management Agency, and shall
provide any such agent or broker with indemnification, including
court costs and reasonable attorney fees, arising out of and caused by
an error or omission on the part of the Federal Emergency Manage-
ment Agency and its contractors. The Director of the Federal Emer-
gency Management Agency may not hold harmless or indemnify an
agent or broker for his or her error or omission.".
CRIME AND RIOT INSURANCE
12 use I749bbb. SEC. 342. (a) Section 1201(b) of the National Housing Act is
amended—
(1) by striking out "September 30,1981" in paragraph (1) and
inserting in lieu thereof September 30,1982"; and
(2) by striking out "September 30, 1984" in paragraph (IXA)
and inserting in lieu thereof "September 30,1985".
12 use (b) Section 1211(b) of the National Housing Act is amended—
i749bbb-3. (1) by inserting "and" at the end of paragraph (9);
(2) by striking out "; and" at the end of paragraph (10) and
inserting in lieu thereof a period; and
(3) by striking out paragraph (11).
PART 5-RURAL HOUSING
AUTHORIZATIONS
94 Stat. 1667. SEC. 351. (a) Section 513 of the Housing Act of 1949 is amended—
42 use 1483. (1) by striking out "not to exceed $3,797,600,000 with respect to
the fiscal year ending September 30,1981" in subsection (a) and
inserting in lieu thereof "not to exceed $3,700,600,000 with
• respect to the fiscal year ending September 30,1982";
(2) by striking out "not less than $3,120,000,000" in subsection
(aXD and inserting in lieu thereof "not less than $3,170,000,000";
(3) by striking out "not more than $100,000,000" in subsection
(a)(4) and inserting in lieu thereof "none";
(4) by striking out subsection (bX2) and inserting in lieu thereof
the following:
"(2) not to exceed $50,000,000 for loans and grants pursuant to
42 use 1474. section 504 for the fiscal year ending September 30, 1982, of
which not more than $25,000,000 shall be available for grants;";
(5) by striking out subsection (bX3) and inserting in lieu thereof
the following:
"(3) not to exceed $25,000,000 for financial assistance pursuant
42 use I486. to section 516 for the fiscal year ending September 30, 1982;";
(6) by striking out "September 30,1981" in subsection (bX4) and
inserting in lieu thereof "September 30,1982"; and
(7) by striking out "and" at the end of subsection 0)X4), by
striking out the period at the end of subsection (bX5) and
inserting in lieu thereof "; and", and by adding at the end thereof
the following:
42 use 1479. "(6) not to exceed $2,000,000 for the purposes of section 509(c)
for the fiscal year ending September 30,1982.".
?o f^h }^r' Ot)) Section 515(bX5) of such Act is amended by striking out "Sep-
42 use 1485. tember 30,1981" and mserting in lieu thereof "(September 30,1982*'.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 421
(c) Section 517(aXl) of such Act is amended by striking out "Septem- 94 Stat. 1668.
42 u s e 1487.
ber 80, 1981" and inserting in lieu thereof "September 30, 1982".
(d) Section 521(aX2XD) of such Act is amended— 94 Stat. 1668.
42 u s e 1490a.
(1) by striking "$493,000,000" and inserting in lieu thereof
"$398,000,000"; and
(2) by striking out "1981, except that" and all that follows
through the period at the end thereof and inserting in lieu
thereof "1982.".
(e) Section 523 of such Act is amended— 94 Stat. 1668.
42 u s e 1490c.
(1) by striking out "September 30,1981" each place it appears
in subsection (f) and inserting in lieu thereof "September 30,
1982";
(2) by striking out "not to exceed $2,500,000 for fiscal year
1981" in the first sentence of subsection (g) and inserting in lieu
thereof "not to exceed $3,000,000 for fiscal year 1982";
(3) by inserting the following after "shall be available" in the
second sentence of subsection (g): ", to the extent approved in
appropriation Acts,"; and
(4) by inserting the following before the period at the end of the
second sentence of subsection (g): "; except that not more than
$5,000,000 may be made available during fiscal year 1982".
INTEREST SUBSIDY PROGRAM
SEC. 352. Section 521(aXlXB) of the Housing Act of 1949 is amended 94 Stat. 1669.
42 u s e 1490a.
by striking out "shall" and iaserting in lieu thereof "may".
REPORTS
SEC. 353. The Secretary of Agriculture shall transmit a report to Transmittal to
the Congress not later than March 1,1982, setting forth— eongress.
(1) various options for presenting the budget of the Farmers
Home Administration and alternatives to the use of Federal
Financing Bank financing for rural housing programs;
(2) workable definitions of "low income" which will target
Farmers Home Administration housing assistance programs to a
population substantially equivalent to the population served by
the Department of Housing and Urban Development's assisted
housing programs;
(3) the effect of a requirement that 30 per centum of assistance
provided by the Farmers Home Administration be provided to
families with incomes at 50 per centum of area median income
and recommendations for contribution requirements which will
achieve equity with the contribution requirements of the Depart-
ment of Housing and Urban Development's assisted housing
programs;
(4) recommendations for ensuring that subsidy levels for as-
sisted families are minimized and that assisted families with
similar circumstances in different regions of the country are
treated equally; and
(5) the Farmers Home Administration's efforts to minimize
the cost of housing subsidized under its programs and the
Farmers Home Administration's use of existing lower cost hous-
ing technology.
95 STAT. 422 PUBLIC LAW 97-35—AUG. 13, 1981
Multifamiiy PART 6—MULTIFAMILY MORTGAGE FORECLOSURE
Mortgage
Foreclosure Act
of 1981. SHORT TITLE
12 use 3701 SEC. 361. This part may be cited as the "Multifamiiy Mortgage
note. Foreclosure Act of 1981".
FINDINGS AND PURPOSE
12 use 3701. SEC. 362. (a) The Congress finds that—
(1) disparate State laws under which the Secretary of Housing
and Urban Development forecloses real estate mor^ages which
the Secretary holds pursuant to title II of the National Housing
12 use 1707 Act or section 312 of the Housing Act of 1964 covering multiunit
42 use 1452b. residential and nonresidential properties burden the programs
administered by the Secretary pursuant to these authorities, and
cause detriment to the residents of the afTected projects and the
community generally;
(2) long periods to complete the foreclosure of these mortgages
under certain State laws lead to deterioration in the condition of
the properties involved; necessitate substantial Federal manage-
ment and holding expenditures; increase the risk of vandalism,
fire loss, depreciation, damsige, and waste with respect to the
properties; and adversely affect the residents of the projects and
the neighborhoods in which the properties are located;
(3) these conditions seriously impair the Secretary's ability to
protect the Federal financial interest in the affected properties
and frustrate attainment of the objectives of the underljdng
Federal program authorities, as well as the national housing go^
of "a decent home and a suitable living environment for every
American family";
(4) application of State redemption periods to these mortgages
following their foreclosure would impair the salability of the
properties involved and discourage their rehabilitation and im-
provement, thereby compounding the problems referred to in
clause (3);
(5) the availability of a uniform and more expeditious proce-
dure for the foreclosure of these mortgages by the Secretary and
continuation of the practice of not appl)dng postsale redemption
periods to such mortgages will tend to ameliorate these condi-
tions; and
(6) providing the Secretary with a nonjudicial foreclosure
procedure will reduce unnecessary litigation by removing many
foreclosures from the courts where they contribute to over-
crowded calendars.
(b) The purpose of this part is to create a uniform Federal
foreclosure remedy for multiunit residential and nonresidentisil
mortgages held by the Secretary of Housing and Urban Development
pursuant to title II of the National Housing Act or section 312 of the
Housing Act of 1964.
DEFINITIONS
12 use 3702. SEC. 363. As used in this part—
(1) "mortgage" means a deed of trust, mortgage, deed to secure
debt, security agreement, or any other form of instrument under
which any interest in property, real, personal or mixed, or any
interest in property including leaseholds, life estates, reversion-
ary interests, and any other estates under applicable State law, is
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 423
conveyed in trust, mortgaged, encumbered, pledged, or otherwise
rendered subject to a lien, for the purpose of securing the
pa3niient of money or the performance of an obligation;
(2) "multifamily mortgage" means a mortgage held by the
Secretary pursuant to title 11 of the National Housing Act or
section 312 of the Housing Act of 1964 covering any property, 12 use 1707.
except a property on which there is located a one- to four-family ^^ use I452b.
residence;
(3) "mortgage agreement" meeins the note or debt instrument
and the mortgage instrument, deed of trust instrument, trust
deed, or instrument or instruments creating the mortgage,
including any instrument incorporated by reference therein
(including any applicable regulatory agreement), and any instru-
ment or agreement amending or modifying any of the foregoing;
(4) "mortgagor" means the obligor, grantor, or trustor named
in the mortgage agreement and, unless the context otherwise
indicates, includes the current owner of record of the security
property whether or not personally liable on the mortgage debt;
(5) "person" includes any individual, group of individuals,
association, partnership, corporation, or organization;
(6) "record" and "recorded" include "register" and "regis-
tered" in the instance of registered land;
(7) "security property" means the property, real, personal or
mixed, or an interest in property, including leaseholds, life
estates, reversionary interests, and any other estates under
applicable State law, together with fixtures and other interests
subject to the lien of the mortgage under applicable State law;
(8) "State" means the several States, the District of Columbia,
the Commonwealth of Puerto Rico, the territories and posses-
sions of the United States, and the Trust Territory of the Pacific
Islands, and Indian tribes as defined by the Secretary;
(9) "county" means county as defined in section 2 of title I,
United States Code; and i use 2.
(10) "Secretary" means the Secretary of Housing and Urban
Development.
APPLICABIUTY
SEC. 364. Multifamily mortgages held by the Secretary encumber- 12 use 3703.
ing real estate located in any State may be foreclosed by the
Secretary in accordance with this part, or pursuant to other foreclo-
sure procedures available, at the option of the Secretary.
DESIGNATION OF FORECLOSURE COMMISSIONER
SEC. 365. A foreclosure commissioner or commissioners designated 12 use 3704.
pursuant to this part shall have a nonjudicial power of sale as
provided in this part. Where the Secretary is the holder of a
multifamily mortgage, the Secretary may designate a foreclosure
commissioner and, with or without cause, may designate a substitute
foreclosure commissioner to replace a previously designated foreclo-
sure commissioner, by executing a duly acknowledged, written desig-
nation stating the name and business or residential address of the
commissioner or substitute commissioner. The designation shall be
effective upon execution. Except as provided in section 368(b), a copy
of the designation shall be mailed with each copy of the notice of
default and foreclosure sale served by mail in accordance with section
369(1). The foreclosure commissioner, if a natural person, shall be a
resident of the State in which the security property is located and, if
-194 0—82 29 : QL3
95 STAT. 424 PUBLIC LAW 97-35—AUG. 13, 1981
not a natural person, the foreclosure commissioner must be duly
authorized to transact business under the laws of the State in which
the security property is located. The foreclosure commissioner shall
be a person who is responsible, financially sound and competent to
conduct the foreclosure. More than one foreclosure commissioner
may be designated. If a natural person is designated as foreclosure
commissioner or substitute foreclosure commissioner, such person
shall be designated by name, except that where such person is
designated in his or her capacity as an official or employee of the
government of the State or subdivision thereof in which the security
property is located, such person may be designated by his or her
unique title or position instead of by name. The Secretary shall be a
guarantor of payment of any judgment against the foreclosure
commissioner for damages based upon the commissioner's failure
properly to perform the commissioner's duties. As between the
Secretary and the mortgagor, the Secretary shall bear the risk of any
financial default by the foreclosure commissioner. In the event that
the Secretary makes any payment pursuant to the preceding two
sentences, the Secretary shall be fully subrogated to the rights
satisfied by such payment.
PREREQUISITES TO FORECLOSURE
12 use 3705. SEC. 866. Foreclosure by the Secretary under this part of a multi-
family mortgage may be commenced, as provided in section 368, upon
the breach of a covenant or condition in the mortgage agreement for
which foreclosure is authorized under the mortgage, except that no
such foreclosure may be commenced unless any previously pending
proceeding, judicial or nonjudicial, separately instituted by the Secre-
tary to foreclose the mortgage other than under this part has been
withdrawn, dismissed, or otherwise terminated. No such separately
instituted foreclosure proceeding on the mortgage shall be instituted
by the Secretary during the pendency of foreclosure pursuant to this
part. Nothing in this part shall preclude the Secretary from enforcing
any right, other than foreclosure, under applicable State law, includ-
ing any right to obtain a monetary judgment. Nothing in this part
shall preclude the Secretary from foreclosing under this part where
the Secretary has obtained or is seeking any other remedy available
pursuant to Federal or State law or under the mortgage agreement,
including, but not limited to, the appointment of a receiver, mort-
gagee-in-possession status or relief under an assignment of rents.
NOTICE OF DEFAULT AND FORECLOSURE SALE
12 use 3706. SEC. 367. (a) The notice of default and foreclosure sale to be served
in accordance with this part shall be subscribed with the name and
address of the foreclosure commissioner and the date on which
subscribed, and shall set forth the following information:
(1) the names of the Secretary, the original mortgagee and the
original mortgagor;
(2) the street address or a description of the location of the
security property, and a description of the security property, or
so much thereof as is to be offered for sale, sufficient to identify
the property to be sold;
(3) the date of the mortgage, the office in which the mortgage is
recorded, and the liber and folio or other description of the
location of recordation of the mortgage;
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 425
(4) the failure to make payment, including the due date of the
earliest installment pa3mient remaining wholly unpaid as of the
date the notice is subscribed, or the description of other default
or defaults upon which foreclosure is based, and the acceleration
of the secured indebtedness;
(5) the date, time, and place of the foreclosure sale;
(6) a statement that the foreclosure is being conducted pursu-
ant to this part;
(7) the types of costs, if any, to be paid by the purchaser upon
transfer of title; and
(8) the amount and method of deposit to be required at the
foreclosure sale (except that no deposit shall be required of the
Secretary), the time and method of payment of the balance of the
foreclosure purchase price and other appropriate terms of sale.
(b)(1) Except as provided in paragraph (2)(A), the Secretary may
require, as a condition and term of sale, that the purchaser at a
foreclosure sale under this part agree to continue to operate the
security property in accordance with the terms, as appropriate, of the
loan program under section 312 of the Housing Act of 1964, the 42 use I452b.
program under which insurance under title II of the National
Housing Act was originally provided with respect to such property, or 12 use 1707.
any applicable regulatory or other agreement in effect with respect to
such property immediately prior to the time of foreclosure sale.
(2)(A) In any case where the majority of the residential units in a
property subject to such a sale are occupied by residential tenants at
the time of the sale, the Secretary shall require, as a condition and
term of sale, any purchaser (other than the Secretary) to operate the
property in accordance with such terms, as appropriate, of the
programs referred to in paragraph (1).
(B) In any case where the Secretary is the purchaser of a multi-
family project, the Secretary shall manage and dispose of such project
in accordance with the provisions of section 203 of the Housing and
Community Development Amendments of 1978. 12 use I7i5z-ii.
COMMENCEMENT OF FORECLOSURE
SEC. 368. (a) If the Secretary as holder of a multifamily mortgage 12 use 3707.
determines that the prerequisites to foreclosure set forth in section
366 are satisfied, the Secretary may request the foreclosure commis-
sioner to commence foreclosure of the mortgage. Upon such request,
the foreclosure commissioner shall commence foreclosure of the
mortgage, by commencing service of a notice of default and foreclo-
sure sale in accordance with section 369.
(b) Subsequent to commencement of a foreclosure under this part,
the Secretary may designate a substitute foreclosure commissioner at
any time up to forty-eight hours prior to the time of foreclosure sale,
and the foreclosure shall continue without prejudice, unless the
substitute commissioner, in his or her sole discretion, finds that
continuation of the foreclosure sale will unfairly affect the interests
of the mortgagor. In the event that the substitute commissioner
makes such a finding, the substitute commissioner shall cancel the
foreclosure sale, or adjourn such sale in the manner provided in
section 369B(c). Upon designation of a substitute foreclosure commis-
sioner, a copy of the written notice of such designation referred to in
section 365 shall be served upon the persons set forth in section 369(1)
of this part (1) by mail as provided in such section 369 (except that the
minimum time periods between mailing and the date of foreclosure
sale prescribed in such section shall not apply to notice by mail
95 STAT. 426 PUBLIC LAW 97-35—AUG. 13, 1981
pursuant to this subsection), or (2) in any other manner, which in the
substitute commissioner's sole discretion, is conducive to achieving
timely notice of such substitution. In the event a substitute foreclo-
sure commissioner is designated less than forty-eight hours prior to
the time of the foreclosure sale, the pending foreclosure shall be
terminated and a new foreclosure shall be commenced by commenc-
ing service of a new notice of default and foreclosure sale.
SERVICE OF NOTICE OF DEFAULT AND FORECLOSURE SALE
12 use 3708. SEC. 369. The foreclosure commissioner shall serve the notice of
default and foreclosure sale provided for in section 367 upon the
following persons and in the following manner, and no additional
notice shall be required to be served notwithstanding any notice
requirements of any State or local law—
(1) NOTICE BY MAIL.—The notice of default and foreclosure sale,
together with the designation required by section 365, shall be
sent by certified or registered mail, postage prepaid and return
receipt requested, to the following persons:
(A) the current security property owner of record, as the
record exists forty-five days prior to the date originally set
for foreclosure sale, whether or not the notice describes a
sale adjourned as provided in this part;
(B) the original mortgagor and all subsequent mortgagors
of record or other persons who appear of record or in the
mortgage agreement to be liable for part or all of the
mortgage debt, as the record exists forty-five days prior to
the date originally set for foreclosure sale, whether or not
the notice describes a sale adjourned as provided in this part,
except any such mortgagors or persons who have been
released; and
(C) all persons holding liens of record upon the security
property, as the record exists forty-five days prior to the date
originally set for foreclosure sale, whether or not the notice
describes a sale adjourned as provided in this part.
Notice under clauses (A) and (B) of this paragraph shall be
mailed at least twenty-one days prior to the date of foreclosure
sale, and shall be mailed to the owner or mortgagor at the
address stated in the mortgage agreement, or, if none, to the
address of the security property, or, at the discretion of the
foreclosure commissioner, to any other address believed to be
that of such owner or mortgagor. Notice under clause (C) of this
paragraph shall be mailed at least ten days prior to the date of
foreclosure sale, and shall be mailed to each such lienholder's
address as stated of record or, at the discretion of the foreclosure
commissioner, to any other address believed to be that of such
lienholder. Notice by mail pursuant to this subsection or section
368(b) of this part shall be deemed duly given upon mailing,
whether or not received by the addressee and whether or not a
return receipt is received or the letter is returned.
(2) PuBUCATiON.—A copy of the notice of default and foreclo-
sure sale shall be published, as provided herein, once a week
during three successive calendar weeks, and the date of last
publication shall be not less than four nor more than twelve days
prior to the sale date. The information included in the notice of
default and foreclosure sale pursuant to section 367(a)(4) may be
omitted, in the foreclosure commissioner's discretion, from the
Newspaper published notice. Such publication shall be in a newspaper or
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 427
newspapers having general circulation in the county or counties
in which the security property being sold is located. To the extent
practicable, the newspaper or newspapers chosen shall be a
newspaper or newspapers, if any is available, having circulation
conducive to achieving notice of foreclosure by publication.
Should there be no newspaper published at least weekly which Posting in
has a general circulation in one of the counties in which the public place.
security property being sold is located, copies of the notice of
default and foreclosure sale shall be posted in at least three
public places in each such county at least twenty-one days prior
to the date of sale.
(8) POSTING.—A copy of the notice of default and foreclosure
sale shall be posted in a prominent place at or on the real
property to be sold at least seven days prior to the foreclosure
sale, and entry upon the premises for this purpose shall be
privileged as against all persons. If the property consists of two or
more noncontiguous parcels of land, a copy of the notice of
default and foreclosure sale shall be posted in a prominent place
on each such parcel. If the security property consists of two or
more separate buildings, a copy of the notice of default and
foreclosure sale shall be posted in a prominent place on each such
building. Posting at or on the premises shall not be required
where the foreclosure commissioner, in the commissioner s sole
discretion, finds that the act of posting will likely cause a breach
of the peace or that posting may result in an increased risk of
vandalism or damage to the property.
PRESALE REINSTATEMENT
SEC. 869A. (a) Except as provided in sections 368(b) and 369B(c), the Sale cancellation
foreclosure commissioner shall withdraw the security property from conditions.
12 use 3709.
foreclosure and cancel the foreclosure sale only if—
(1) the Secretary so directs the commissioner prior to or at the
time of sale;
(2) the commissioner finds, upon application of the mortgagor
at least three days prior to the date of sale, that the default or
defaults upon which the foreclosure is based did not exist at the
time of service of the notice of default and foreclosure sale; or
(3)(A) in the case of a foreclosure involving a monetary default,
there is tendered to the foreclosure commissioner before public
auction is completed the entire amount of principal and interest
which would be due if payments under the mortgage had not
been accelerated; (B) in the case of a foreclosure involving a
nonmonetary default, the foreclosure commissioner, upon appli-
cation of the mortgagor before the date of foreclosure sale, finds
that such default is cured; and (C) there is tendered to the
foreclosure commissioner before public auction is completed all
amounts due under the mortgage agreement (excluding addi-
tional amounts which would have been due if mortgage pay-
ments had been accelerated), all amounts of expenditures
secured by the mortgage and all costs of foreclosure incurred for
which payment from the proceeds of foreclosure is provided in
section 369C, except that the Secretary shall have discretion to
refuse to cancel a foreclosure pursuant to this paragraph (3) if the
current mortgagor or owner of record has on one or more
previous occasions caused a foreclosure of the mortgage, com-
menced pursuant to this part or otherwise, to be canceled by
curing a default.
95 STAT. 428 PUBLIC LAW 97-35—AUG. 13, 1981
(b) Prior to withdrawing the security property from foreclosure in
the circumstances described in subsection (aX2) or (aX3), the foreclo-
sure commissioner shall afford the Secretary a reasonable opportu-
nity to demonstrate why the security property should not be so
withdrawn.
(c) In any case in which a foreclosure commenced under this part is
canceled, the mortgage shall continue in effect as though acceleration
had not occurred.
(d) If the foreclosure commissioner cancels a foreclosure sale under
this part a new foreclosure may be subsequently commenced as
provided in this part.
CONDUCT OF SALE; ADJOURNMENT
12 u s e 3710. SEC. 369B. (a) The date of foreclosure sale set forth in the notice of
default and foreclosure sale shall not be prior to thirty days after the
due date of the earliest installment wholly unpaid or the earliest
occurrence of any uncured nonmonetary default upon which foreclo-
Public auction. sure is based. Foreclosure sale pursuant to this part shall be at public
auction, and shall be scheduled to begin between the hours of 9
o'clock ante meridian and 4 o'clock post meridian local time on a day
other than Sunday or a public holiday as defined by section 6108(a) of
title 5, United States Code, or State law. The foreclosure sale shall be
held at a location specified in the notice of default and foreclosure
sale, which shall be a location where foreclosure real estate auctions
are customarily held in the county or one of the counties in which the
property to be sold is located, or at a courthouse therein, or at or on
the property to be sold. Sale of security property situated in two or
more counties may be held in any one of the counties in which any
part of the security property is situated.
(b) The foreclosure commissioner shall conduct the foreclosure sale
in accordance with the provisions of this part and in a manner fair to
both the mortgagor and the Secretary. The foreclosure commissioner
shall attend the foreclosure sale in person, or, if there are two or more
commissioners, at least one shall attend the foreclosure sale. In the
event that no foreclosure commissioner is a natural person, the
foreclosure commissioner shall cause its duly authorized employee to
Written one- attend the foreclosure sale to act on its behalf. Written one-price
price sealed bids shall be accepted by the foreclosure commissioner from
sealed bids. the Secretary and other persons for entry by announcement by the
commissioner at the sale. The Secretary and any other person may
bid at the foreclosure sale, including the Secretary or any other
person who has submitted a written one-price bid, except that the
foreclosure commissioner or any relative, related business entity or
employee of such commissioner or entity shall not be permitted to bid
in any manner on the security property subject to foreclosure sale.
The foreclosure commissioner may serve as auctioneer, or, in accord-
ance with regulations of the Secretary, may employ an auctioneer to
be paid from the commission provided for in section 369C(5).
(c) The foreclosure commissioner shall have discretion, prior to or
at the time of sale, to adjourn or cancel the foreclosure sale if the
commissioner determines, in the commissioner's sole discretion, that
circumstances are not conducive to a sale which is fair to the
mortgagor and the Secretary or that additional time is necessary to
determine whether the security property should be withdrawn from
foreclosure as provided in section 369A. The foreclosure commis-
sioner may adjourn a sale to a later hour the same day without the
giving of further notice, or may adjourn the foreclosure sale for not
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 429
less than nine nor more than twenty-four days, in which case the
commissioner shall serve a notice of default and foreclosure sale
revised to recite that the foreclosure sale has been adjourned to a
specified date and to include any corrections the foreclosure commis-
sioner deems appropriate. Such notice shall be served by publication,
mailing and posting in accordance with section 369, except that
publication may be made on any of three separate days prior to the
revised date of foreclosure sale, and mailing may be made at any time
at least seven days prior to the date to which the foreclosure sale has
been adjourned.
FORECLOSURE COSTS
SEC. 369C. The following foreclosure costs shall be paid from the 12 use 3711.
sale proceeds prior to satisfaction of any other claim to such sale
proceeds:
(1) necessary advertising costs and postage incurred in giving
notice pursuant to sections 369 and 369B;
(2) mileage for posting notices and for the foreclosure commis-
sioner's attendance at the sale at the rate provided in section
1921 of title 28, United States Code, for mileage by the most
reasonable road distance;
(3) reasonable and necessary costs actually incurred in connec-
tion with any necessary search of title and lien records;
(4) necessary out-of-pocket costs incurred by the foreclosure
commissioner to record documents; and
(5) a commission for the foreclosure commissioner for the
conduct of the foreclosure to the extent authorized by regulations
issued by the Secretary.
DISPOSITION OP SALE PROCEEDS
SEC. 369D. Money realized from a foreclosure sale shall be made 12 use 3712.
available for obligation and expenditure—
(1) first to cover the costs of foreclosure provided for in section
369C;
(2) then to pay valid tax liens or assessments prior to the
mortgage;
(3) then to pay any liens recorded prior to the recording of the
mortgage which are required to be paid in conformity with the
terms of sale in the notice of default and foreclosure sale;
(4) then to service charges and advancements for taxes, assess-
ments, and property insurance premiums;
(5) then to the interest;
(6) then to the principal balance secured by the mortgage
(including expenditures for the necessary protection, preserva-
tion, and repair of the security property as authorized under the
mortgage agreement and interest thereon if provided for in the
mortgage agreement); and
(7) then to late charges.
Any surplus after payment of the foregoing shall be paid to holders of Surplus
liens recorded after the mortgage and then to the appropriate Proceeds.
mortgagor. If the person to whom such surplus is to be paid cannot be
located, or if the surplus available is insufficient to pay all claimants
and the claimants cannot agree on the allocation of the surplus, or if
any person claiming an interest in the mortgage proceeds does not
agree that some or all of the sale proceeds should be paid to a
claimant as provided in this section, that part of the sale proceeds in
question may be deposited by the foreclosure commissioner with an
95 STAT. 430 PUBLIC LAW 97-35—AUG. 13, 1981
appropriate official or court authorized under law to receive disputed
funds in such circumstances. If such a procedure for the deposit of
disputed funds is not available, and the foreclosure commissioner
files a bill of interpleader or is sued as a stakeholder to determine
entitlement to such funds, the foreclosure commissioner's necessary
costs in taking or defending such action shall be deductible from the
disputed funds.
TRANSFER OF TITLE AND POSSESSION
i^Tror ^71 q ^^^' ^^^^' ^^^ "^^ foreclosure commissioner shall deliver a deed or
use 3713. deeds to the purchaser or purchasers and obtain the balance of the
purchase price in accordance with the terms of sale provided in the
notice of default and foreclosure sale.
Qy) Subject to subsection (c), the foreclosure deed or deeds shall
convey all of the right, title, and interest in the security property
covered by the deed which the Secretary as holder, the foreclosure
commissioner, the mortgagor, and any other persons claiming by,
through, or under them, had on the date of execution of the mortgage,
together with all of the right, title, and interest thereafter acquired
by any of them in such property up to the hour of sale, and no judicial
proceeding shall be required ancillary or supplementary to the
procedures provided in this part to assure the validity of the convey-
ance or confirmation of such conveyance.
(c) A purchaser at a foreclosure sale held pursuant to this part shall
be entitled to possession upon passage of title to the mortgaged
property, subject to an interest or interests senior to that of the
mortgage and subject to the terms of any lease of a residential tenant
for the remaining term of the lease or for one year, whichever period
is shorter. Any other person remaining in possession after the sale
and any residential tenant remaining in possession after the appli-
cable period shall be deemed a tenant at sufferance.
(d) There shall be no right of redemption, or right of possession
based upon right of redemption, in the mortgagor or others subse-
quent to a foreclosure pursuant to this part.
'T^- (e) When conveyance is made to the Secretary, no tax shall be
imposed or collected with respect to the foreclosure commissioner's
deed, whether as a tax upon the instrument or upon the privilege of
conveying or transferring title to the property. Failure to collect or
pay a tax of the t5rpe and under the circumstances stated in the
preceding sentence shall not be grounds for refusing to record such a
deed, for failing to recognize such recordation as imparting notice or
for denying the enforcement of such a deed and its provisions in any
State or Federal court.
RECORD OF FORECLOSURE AND SALE
Deed affidavit. SEC. 369F. (a) To establish a sufficient record of foreclosure and
12 use 3714. gg^ig^ ^jjg foreclosure commissioner shall include in the recitals of the
deed to the purchaser or prepare an affidavit or addendum to the
deed stating—
(1) that the mortgage was held by the Secretary;
(2) the particulars of the foreclosure commissioner's service of
notice of default and foreclosure sale in accordance with sections
369and369B;
(3) that the foreclosure was conducted in accordance with the
provisions of this part and with the terms of the notice of default
and foreclosure saie;
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 431
(4) a correct statement of the costs of foreclosure, calculated in
accordance with section 369C; and
(5) the name of the successful bidder and the amount of the
successful bid.
(b) The deed executed by the foreclosure commissioner, the foreclo-
sure conmiissioner's affidavit and any other instnmients submitted
for recordation in relation to the foreclosure of the security property
under this part shall be acc^ted for recordation by the r e ^ t r a r of
deeds or other appropriate ofncial of the county or counties in which
the security property is located upon tendering of payment of the
usual recording fees for such instruments.
COMPUTATION OF TIME
SEC. 369G. Periods of time provided for in this part shall be 12 u s e 3715.
calculated in consecutive calendar days including the day or days on
which the actions or events occur or are to occur for which the period
of time is provided and including the day on which an event occurs or
is to occur from which the period is to be calculated.
SEPARABILITY
SEC. 369H. If any clause, sentence, paragraph or part of this part 12 use 3716.
shall, for any reason, be adjudged by a court of competent jurisdiction
to be invalid or invsdid as applied to a class of cases, such judgment
shall not affect, impair, or invalidate the remainder thereof and of
this part, but shall be confined in its operation to the clause, sentence,
paragraph, or part thereof directly involved in the controversy in
which such judgment shsdl have been rendered.
REGULATIONS
SEC. 3691. The Secretary is authorized to issue such regulations as 12 use 3717.
may be necessary to carry out the provisions of this part.
PART 7—EFFECTIVE DATE
EFFECTIVE DATE
SEC. 371. (a) Except as otherwise provided in this subtitle, the 12 u s e 3701
provisions of this subtitle shall take effect on October 1, 1981. note.
(b) The amendments made by sections 324, 325, and 326(a) shall Ante, pp. 405,
apply only with respect to contracts entered into on and after Octo- 406.
ber 1,1981.
Subtitle B—Banking and Related Programs Banking and
Related
Programs
SHORT TITLE Authorization
Adjustment Act.
SEC. 380. This subtitle may be cited as the "Banking and Related 12 u s e 635 note.
Programs Authorization Adjustment Act".
EXPORT-IMPORT BANK OF THE UNITED STATES
SEC. 381. (a) Section 7(a) of the Export-Import Bank Act of 1945 (12
U.S.C. 635e(a)) is amended—
(1) by inserting "(1)" after "Sec. 7. (a)"; and
(2) by adding at the end thereof the following:
95 STAT. 432 PUBLIC LAW 97-35—AUG. 13, 1981
"(2) Within the limits of funds and borrowing authority available to
the Bank pursuant to this Act, gross obligations for the principal
amount of direct loans authorized by the Bank during fiscal years
1982 and 1983 shall not exceed $10,478,000,000, of which amount
$5,065,000,000 is designated for fiscal year 1982 and $5,413,000,000 is
designated for fiscal year 1983.".
Report to (b) On or before December 15,1981, the Secretary of the Treasury
Congress.
shall transmit a report to both Houses of the Congress regarding the
status of negotiations within the Organization for Economic Coopera-
tion and Development on improving the International Arrangement
on Guidelines for Officially Supported Export Credits and on the
status of any other multilateral or bilateral negotiations or discus-
sions for the purpose of improving any other arrangements, stand-
stills, minutes, and practices involving official export financing in
which the United States participates. Such report shall include—
(1) an assessment of the progress, if any, that has been made in
these negotiations, and of the prospects for a successful conclu-
sion to these negotiations within a reasonable time; and
(2) a recommendation by the Secretary of the Treasury as to
whether the Congress, in order to improve the prospects for a
successful conclusion to these negotiations, should enact legisla-
tion for the purpose of enhancing the ability of the Export-Import
Bank of the United States to offer or support export credit fully
competitive with the subsidized official export credit offered or
supported by other governments.
DEPARTMENT OF THE TREASURY
Appropriation SEC. 382. (a) Section 5 of the Act of November 8,1978 (92 Stat. 3092;
authorization. Public Law 95-612), is amended—
(1) in subsection (a), by striking out "$24,000,000 for fiscal year
1979 and $22,375,000 for fiscal year 1980," and inserting in lieu
thereof "$22,896,000 for fiscal year 1982, and such sums as may
be necessary for each fiscal year thereafter"; and
(2) in subsection (b), by striking out "for fiscal year 1980 not to
exceed $800,000" and inserting in lieu thereof "not to exceed
$1,000,000 for fiscal year 1982, and such sums as may be neces-
sary for each fiscal year thereafter,".
(b) The last sentence of section 3552 of the Revised Statutes (31
U.S.C. 369) is amended to read as follows: "There are authorized to be
appropriated for fiscal year 1982 not to exceed $54,706,000 for all
expenditures (salaries and expenses) of the mints and assay offices
not herein otherwise provided for.".
Effective date. (2) The amendment made by paragraph (1) shall take effect on
31 u s e 369 note. October 1,1981.
COUNCIL ON WAGE AND PRICE STABILITY
Repeal. SEC. 383. Section 6 of the Council on Wage and Price Stability Act
(12 U.S.C. 1904 note) is hereby repealed.
USURY PROVISION
SEC. 384. Section 501(a)(l)(C)(vi) of the Depository Institutions
Deregulation and Monetary Control Act of 1980 (12 U.S.C. 1735f-7
note) is amended by inserting "or a residential manufactured home"
after "residential real property".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 433
RESERVE REQUIREMENTS
SEC. 385. (a) Section 19(b)(8)(E) of the Federal Reserve Act (12 U.S.C.
461(b)(8)(E)) is amended by striking out the first two sentences thereof 94 Stat. 133.
and inserting in lieu thereof the following: "This subparagraph
applies to any depository institution that, on August 1,1978, (i) was
engaged in business as a depository institution in a State outside the
continental limits of the United States, and (ii) was not a member of
the Federal Reserve System at any time on or after such date. Such a
depository institution shall not be required to maintain reserves
against its deposits held or maintained at its offices located in a State
outside the continental limits of the United States until the first day
of the sixth calendar year which begins after the effective date of the
Monetary Control Act of 1980.".
(b) The third sentence of section 19(b)(8)(E) of such Act (12 U.S.C.
461(b)(8)(E)) is amended by striking out "its deposits" and inserting in
lieu thereof "such deposits".
Subtitle C—National Consumer Cooperative Bank Act National
Consumer
Amendments Cooperative
Bank Act
Amendments
SHORT TITLE of 1981.
SEC. 390. This subtitle may be cited as the "National Consumer 12 u s e 3001
Cooperative Bank Act Amendments of 1981". note.
ACCELERATION OF FINAL GOVERNMENT EQUITY REDEMPTION DATE
SEC. 391. (a)(1) The National Consumer Cooperative Bank Act (12
U.S.C. 3001 et seq.) is amended by inserting after section 115 the Post, p. 436.
following:
ACCELERATION OF FINAL GOVERNMENT EQUITY REDEMPTION DATE
"SEC. 116. (a)(1)(A) The Final Government Equity Redemption Date 12 use 3026
shall occur on December 31,1981, or not later than 10 days after the
date of the enactment of the first Act providing for appropriations for
fiscal year 1982 (other than continuing appropriations) for the De-
partment of Housing and Urban Development and Independent
Agencies, whichever occurs later.
"(B) Not later than 5 days after the Final Government Equity Publication in
Redemption Date, the Secretary of the Treasury shall publish a Federal
notice in the Federal Register indicating the day on which the Final Register.
Government Equity Redemption Date occurred.
"(2)(A) Before the Final Government Equity Redemption Date, the
Secretary of the Treasury shall purchase all class A stock for which
the Congress has appropriated funds.
"(B) After the Final Government Equity Redemption Date, the
Secretary of the Treasury shall not purchase any class A stock.
"(3)(A) On the Final Government Equity Redemption Date, all class
A stock held by the Secretary of the Treasury on such date shall be
redeemed by the Bank in exchange for class A notes which are issued
by the Bank to the Secretary of the Treasury on behalf of the United
States and which have a total face value equal to the total par value
of the class A stock which is so redeemed, plus any unpaid dividends
on such stock.
"(B) During the period beginning on the Final Government Equity
Redemption Date and ending on December 31,1990, not less than 30
95 STAT. 434 PUBLIC LAW 97-35—AUG. 13, 1981
percent of the revenue derived from the sale of stock by the Bank,
other than the sale of class B stock or class C stock, shall be used,
upon receipt, to retire class A notes.
"(C) After December 31, 1990, the Bank shall maintain a repay-
ment schedule for class A notes which will assure full repayment of
all class A notes not later than December 31, 2020. The requirement
specified in the previous sentence is in addition to the requirement
regarding the redemption of class A notes which is specified in section
12 u s e 3014. 104(c).
"(b)(1) The United States shall not be responsible for any obligation
of the Bank which is incurred after the Final Government Equity
Redemption Date.
Bylaws. "(2) As soon as practicable after the date of the enactment of this
section, the Board shall adopt bylaws which will assist in expediting
and coordinating the activities which will occur with respect to the
Final Government Equity Redemption Date.".
Effective date. (2) The amendment made by paragraph (1) shall take effect on the
12 u s e 3026 date of the enactment of this Act.
note.
12 u s e 3017a. (b)(1) Only for purposes of section 107(a) of the National Consumer
Cooperative Bank Act (12 U.S.C. 3017(a)), class A notes shall be
deemed to be paid-in capital of the Bank.
Effective date. (2) This subsection shall take effect on the day after the Final
12 u s e 3017a Government Equity Redemption Date.
note.
TAX STATUS OF THE BANK
SEC. 392. (a) Section 109 of the National Consumer Cooperative
Bank Act (12 U.S.C. 3019) is amended—
(1) by striking out "Until the Final Government Equity Re-
demption Date, but not thereafter, the Bank" and inserting in
lieu thereof "(a) The Bank"; and
(2) by adding at the end thereof the following:
"(b) Notwithstanding any other provision of law, for purposes of
26 u s e 1381. subchapter T of the Internal Revenue Code of 1954—
"(1) the Bank shall be treated as a corporation operating on the
cooperative basis within the meaning of section 1381(a)(2) of such
Code;
Definitions. "(2) the term 'patronage dividend', as defined in section 1388(a)
26 u s e 1388. of such Code includes, only as such section applies to the Bank,
any patronage refunds in the form of class B or class C stock or
allocated surplus that are distributed or set aside by the Bank
12 u s e 3014. pursuant to section 104(i) of this Act;
"(3) the terms 'written notice of allocation' and 'qualified
written notices of allocation', as defined in sections 1388 (b) and
(c) of such Code, include (to the extent of par value), only as such
sections apply to the Bank, any class B or class C stock distrib-
uted by the Bank pursuant to section 104(i) of this Act and shall
also include any allocated surplus set aside by the Bank pursuant
to section 104(i) of this Act;
"(4) patrons of the Bank shall be deemed to have consented
under section 1388(c)(2) of such Code to the inclusion in their
incomes of any qualified written notices of allocation received by
such patrons from the Bank; and
"(5) any amounts required to be included in the incomes of
patrons of the Bank with respect to class B or class C stock or
allocated surplus shall be treated as earnings from business done
by such patrons of the Bank with or for their own patrons.".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 435
(b) The amendments made by subsection (a) shall take effect on the Effective date.
day after the Final Government Equity Redemption Date. 12 u s e 3019
note.
BOARD OF DIRECTORS
SEC. 393. (a) Subsections (a), Ot)), (c), and (d) of section 103 of such Act
(12 U.S.C. 3013) are amended to read as follows:
"(a) The Bank shall be governed by a Board of Directors (herein-
after in this Act referred to as the 'Board') which shall consist of 15
members. AH members shall serve for a term of 3 years. After the
expiration of the term of any member, such member may continue to
serve until his successor has been elected or has been appointed and
qualified. Any member appointed by the President may be removed Removal.
for cause by the President.
"(b)(1) The President shall appoint, by and with the advice and Appointment.
consent of the Senate—
"(A) one member who shall be selected from among proprietors
of small business concerns, as defined under section 3 of the
Small Business Act, which are manufacturers or retailers; 12 u s e 371.
"(B) one member who shall be selected from among the officers
of the agencies and departments of the United States; and
"(C) one member who shall be selected from among persons
having extensive experience in the cooperative field representing
low-income cooperatives eligible to borrow from the Bank.
"(2) Twelve members of the Board shall be elected by the holders of
class B stock and class C stock in accordance with the provisions of
subsection (d) and the bylaws of the Bank.
"(c)(1) On the day after the Final Government Equity Redemption Resignation.
Date, all members of the Board of Directors of the Bank who were
appointed by the President shall resign, except that—
"(A) the member who shall have been appointed by the
President from among proprietors of small business concerns,
and
"(B) one member who shall be designated by the President and
who shall have been appointed by the President from among the
officers and employees of the agencies and departments of the
United States Government,
may continue to serve until their successors have been appointed and
qualified.
"(2) Any member of the Board of Directors of the Bank who was
elected by the holders of class B or class C stock before the Final
Government Equity Redemption Date shall serve the remainder of
the term for which such member was elected.
"(3) Any member appointed pursuant to subsection (b)(1) shall be
entitled to sit on any committee of the Board, but not more than one
member so appointed may sit on any one committee.
"(d)(1) All elections of members of the Board by the holders of class
B stock and class C stock shall be conducted in accordance with the
bylaws of the Bank. Such bylaws shall conform to the requirements of
this section. Nominations for such elections shall be made by the
following classes of cooperatives: (A) housing, (B) consumer goods, (C)
low-income cooperatives, (D) consumer services, and (E) all other
eligible cooperatives.
"(2)(A) Vacant shareholder directorships shall be filled so that at Vacant
any time when there are three or more shareholder directors on the shareholder
Board, there shall be at least one director representing each of directorships.
the following classes of cooperatives: (i) housing cooperatives, (ii)
95 STAT. 436 PUBLIC LAW 97-35—AUG. 13, 1981
low-income cooperatives, and (iii) consumer goods and services
cooperatives.
"(B) Each nominee for a shareholder directorship of a particular
class shall have at least three years experience as a director or senior
officer in the class of cooperatives to be represented.
"(C) No one class of cooperatives specified in paragraph (1) shall be
represented on the Board by more than three directors. .
(b) Section 103(h) of such Act (12 U.S.C. 3013(h)) is amended—
(1) in the second sentence thereof, by striking out ", until the
Final Government Equity Redemption Date" and all that follows
through "class B and class C stock" and inserting in lieu thereof
"the member of the Board appointed pursuant to subsection
(b)(1)(C)"; and
(2) by adding at the end thereof the following: "The members of
the Board who are elected by the holders of class B stock and
class C stock shall be compensated in accordance with the bylaws
of the Bank. All compensation and expenses paid to the members
of the Board of Directors shall be paid by the Bank.".
Effective date. (c) The amendments made by subsections (a) and (b) shall take
12 u s e 3013 effect on the day after the Final Government Equity Redemption
note.
Date.
EXAMINATIONS AND AUDITS; CONFORMING AMENDMENTS
SEC. 394. (a)(1) Section 115 of the National Consumer Cooperative
Bank Act (12 U.S.C. 3025) is amended to read as follows:
EXAMINATION AND AUDIT
"SEC. 115. The Farm Credit Administration and the General
Accounting Office are hereby authorized and directed to examine and
Reports to Con- audit the Bank. Reports regarding such examinations and audits
gress. shall be promptly forwarded to both Houses of the Congress. The
Bank shall reimburse the Farm Credit Administration for the costs of
any examination or audit conducted by the Farm Credit Administra-
tion.".
Effective date. (2) The amendment made by paragraph (1) shall take effect on the
12 u s e 3025 day after the Final Government Equity Redemption Date.
note.
(b) The second sentence of section 108(a) of such Act (12 U.S.C.
3018(a)) is amended by striking out "October 1,1983" and inserting in
lieu thereof "October 1,1985".
(c)(1) The first sentence of section 104(a) of such Act (12 U.S.C.
3014(a)) is amended by inserting "by other public or private inves-
tors," after "by public bodies,".
12 u s e 3014 (2) The amendment made by paragraph (1) shall take effect on the
note. day after the Final Government Equity Redemption Date.
(d)(1) The last sentence of section 102 of such Act (12 U.S.C. 3012) is
amended to read as follows: "In determining whether a public
offering is taking place for the purpose of the Securities Act of 1933,
there shsdl be excluded from consideration all class B and class C
stock purchases which took place prior to the date of the enactment of
the National Consumer Cooperative Bank Act Amendments of
1981.".
12 u s e 3012 (2) The amendment made by paragraph (1) shall take effect on the
note. day after the Final Government Equity Redemption Date.
(e)(1) The first sentence of section 105(a) of such Act (12 U.S.C.
3015(a)) is amended by striking out "entirely owned" and inserting in
lieu thereof "primarily owned .
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 437
(2) The amendment made by paragraph (1) shall take effect on the Effective date.
12 u s e 3015
day after the Final Government Equity Redemption Date. note.
(f) Section 105(a)(5) of such Act (12 U.S.C. 3015(a)(5)) is amended by
inserting "(except that this requirement shall not apply to any
housing cooperative in existence on March 21, 1980, which did not
meet such requirement on such date)" after "one vote per person
basis".
(g)(1) The second sentence of section 107(a) of such Act (12 U.S.C.
3017(a)) is amended by striking out "after consultation with the
Secretary of the Treasury".
(2) The amendment made by paragraph (1) shall take effect on the Effective date.
12 u s e 3017
day after the Final Government Equity Redemption Date. note.
NONPROFIT CORPORATION
SEC. 395. (a) The National Consumer Cooperative Bank Act (12
U.S.C. 3001 et seq.) is amended by inserting after section 210 the
following:
" E S T A B L I S H M E N T O F NONPROFIT CORPORATION
"SEC. 211. (a)(1) Upon the incorporation of the nonprofit corpora- 12 u s e 3051.
tion described in subsection (b), the Office of Self-Help Development
and Technical Assistance is hereby abolished.
"(2)(A) If the nonprofit corporation described in subsection (b)
agrees to accept the liabilities of the Office, the Bank, notwithstand-
ing any other provision of law, shall transfer all assets, liabilities, and
property of the Office to such nonprofit corporation on the day on
which such nonprofit corporation is incorporated.
"(B) Such assets shall include all sums which are appropriated to
the Office by the Congress and all sums which are contained in the
Account established pursuant to section 202. If any such sums are 12 u s e 3042.
appropriated after the date on which the transfer described in
subparagraph (A) occurs, the Bank shall promptly transfer such sums
to such nonprofit corporation.
"(b)(1) As soon as possible after the date of the enactment of this
section, the Board shall establish a nonprofit corporation under the
laws of the District of Columbia and, notwithstanding the laws of the
District of Columbia, name the directors of such nonprofit corpora-
tion.
"(2) Notwithstanding the laws of the District of Columbia, the
Board of Directors of such nonprofit corporation shall—
"(A) select an executive director who shall be responsible for
the administration of such nonprofit corporation;
"(B) set the compensation of such executive director and the
other employees of such nonprofit corporation;
"(C) promulgate and publish the policies of such nonprofit
corporation and make such policies available at all times to
eligible cooperatives; and
"(D) perform the functions specified in subparagraphs (A) and
(C) of paragraph (3).
"(3) Such nonprofit corporation shall only perform— Functions.
"(A) the functions which are authorized to be performed
pursuant to sections 203 through 208 and section 210; 12 use
"(B) such functions as are necessary to comply with the laws 3043-3048,
3050.
under which it was incorporated in the District of Columbia; and
"(C) such functions as are necessary to remain qualified as an
organization described in section 501(c)(3) of the Internal Reve-
nue Code of 1954. 26 u s e 501.
95 STAT. 438 PUBLIC LAW 97-35—AUG. 13, 1981
"(4) Notwithstanding any other provision of law—
"(A) the Bank may provide administrative or staff support to
such nonprofit corporation; and
"(B) any member of the Board of Directors of the Bank may
serve as a member of the Board of Directors of such nonprofit
corporation.
"(c)(1) Notwithstanding any other provision of law, such nonprofit
corporation shall be deemed to be, and treated as, qualified as an
organization described in section 501(c)(3) of the Internal Revenue
26 use 501. Code of 1954 from the date on which such nonprofit corporation is
established under the laws of the District of Columbia until the date
on which the Internal Revenue Service makes a final determination
on the application which such nonprofit corporation will submit to
the Internal Revenue Service seeking status as an organization
qualifying under such section.
"(2) When performed by such nonprofit corporation, the functions
described in subsection (b)(3)(A) shall be deemed to be performed for
'charitable purposes' within the meaning of section 501(c)(3) of the
Internal Revenue Code of 1954.
Contributions. "(d)(1) The Board of Directors of the Bank may make contributions
to the nonprofit corporation in such amounts as the Board of
Directors of the Bank deems appropriate, except that—
"(A) such contributions may be made only out of the Bank's
earnings, determined in accordance with generally accepted
accounting principles; and
"(B) the Bank shall set aside amounts sufficient to satisfy its
obligations to the Secretary of the Treasury for payments of
principal and interest on class A notes and other debt before
making any contributions to such nonprofit corporation.
"(2) During any period in which the nonprofit corporation de-
scribed in subsection (b) is qualified as an organization described in
section 501(c)(3) of the Internal Revenue Code of 1954, contributions
made by the Bank pursuant to paragraph (1) shall be treated as
charitable contributions within the meaning of section 170(c)(2) of the
26 use 170. Internal Revenue Code of 1954, and may be deducted notwithstand-
ing the provisions of section 170(b)(2) of such Code.
(3) During any period in which the nonprofit corporation de-
scribed in subsection (b) is qualified as an organization described in
section 501(c)(3) of the Internal Revenue Code of 1954, contributions
to such nonprofit corporation by any person shall qualify £is charita-
ble contributions, as defined in section 170(c) of such Code, for
purposes of the charitable contribution deduction provided for in
section 170(a) of such Code, and shall also qualify for the deductions
for estate and gift tax purposes provided for in sections 2055 and 2522
26 use 2055, of the Internal Revenue Code of 1954.
^^2^- "(e) Notwithstanding the laws of the District of Columbia, the
Board of Directors of such nonprofit corporation shall adopt and
publish its own conflict of interest rules which shall be no less
stringent in effect than the conflict of interest provisions adopted by
12 use 3024. the Board of Directors of the Bank pursuant to section 114.'\
(b)(1) The first sentence of section 202 of the National Consumer
Cooperative Bank Act (12 U.S.C. 3042) is amended by striking out
"$10,000,000 for the fiscal year ending September 30, 1979, and for
the next two succeeding fiscal years an aggregate amount not to
exceed $65,000,000, for the purpose of making advances under section
12 use 3043. 203 of this Act" and by inserting in lieu thereof "for the purpose of
making advances under section 203 of this Act an amount not to
exceed $14,000,000 for fiscal year 1982".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 439
(2) Section 104(a) of such Act (12 U.S.C. 3014(a)) is amended by Appropriation
striking out the second and third sentences thereof and inserting in authorization.
lieu thereof the following: "There are authorized to be appropriated
not to exceed $47,000,000 for fiscal year 1982 for purposes of purchas-
ing class A stock.".
(3) The amendments made by paragraphs (1) and (2) shall take Effective date.
effect on October 1,1981. 12 u s e 3014
note.
CONFORMING AMENDMENTS; DEFINITIONS
SEC. 396. (a) For purposes of this subtitle, the term "Final Govern- 12 u s e 3012
ment Equity Redemption Date" shall have the same meaning given note.
such term in section 101(5) of the National Consumer Cooperative
Bank Act (12 U.S.C. 3011(5)).
(b) The first sentence of section 101 of the National CJonsumer
Cooperative Bank Act (12 U.S.C. 3011) is amended to read as follows:
"The Congress of the United States hereby creates and charters a
body corporate to be known as the National Consumer Cooperative
Bank (hereinafter in this Act referred to as the 'Bank').".
(cXD Section 104(b) of such Act (12 U.S.C. 3014(b)) is amended—
(A) in the first sentence, by striking out "class A, class B," and
inserting in lieu thereof "class B"; and
(B) by amending the second and third sentences to read as
follows: "Class A notes which are held by the United States shall
have first preference with respect to assets and interest pay-
ments over all classes of stock issued by the Bank. So long as any
class A notes are outstanding, the Bank shall not pay any
dividend on any class of stock at a rate greater than the statutory
interest rate payable on class A notes.".
(2) Section 104(c) of such Act (12 U.S.C. 3014(c)) is amended—
(A) by striking out the first sentence thereof;
(B) in the second sentence—
(i) by striking out "class A stock" and inserting in lieu
thereof "class A notes";
(ii) by striking out "dividends" each place it appears
therein and inserting in lieu thereof "interest payments";
and
(iii) by striking out": Provided, That" and inserting in lieu
thereof ", except that";
(C) in the third sentence, by striking out "dividends" and
inserting in lieu thereof "interest payments";
(D) by amending the fourth sentence to read as follows: "Any
such interest payment may be deferred by the Board of Directors
with the approval of the Secretary of the Treasury, except that
any interest payment so deferred shall bear interest at a rate
equal to the rate determined pursuant to the first sentence of
this subsection.";
(E) in the fifth sentence, by striking out "any other class of
stock" and all that follows through the end thereof and inserting
in lieu thereof "any class of stock at any time when the deferred
interest pa)rments on class A notes shall not have been paid in
full, together with any unpaid interest on such notes.";
(F) in the sixth sentence—
(i) by striking out "class A stock" each place it appears
therein and inserting in lieu thereof "class A notes";
(ii) by striking out "other";
(iii) by striking out "dividends" and inserting in lieu
thereof "interest payments"; and
89-194 0—82 30:QL3
95 STAT. 440 PUBLIC LAW 97-35—AUG. 13, 1981
(iv) by striking out "par value" and inserting in lieu
thereof "face value"; and
(G) in the seventh sentence—
(i) by striking out "class A stock" each place it appears
therein and inserting in lieu thereof "class A notes";
(ii) by striking out "cumulative dividends" and inserting
in lieu thereof "interest payments";
(iii) by striking out": Provided, That" and inserting in lieu
thereof ", except that";
(iv) bv striking out "of shares" after "fiscal year a
number ; and
(v) by striking out "par value" each place it appears
therein and inserting in lieu thereof "face value".
(3) Section 104(e) of such Act (12 U.S.C. 3014(e)) is amended—
(A) by striking out "class A stock" each place it appears therein
and inserting in lieu thereof "class A notes"; and
(B) in the last sentence thereof, by striking out "statutory
dividend" and inserting in lieu thereof "statutory interest pay-
ment".
(4) Section 104(f) of such Act (12 U.S.C. 3014(f)) is amended—
(A) by strikiiig out "class A stock is" and inserting in lieu
thereof "class A notes are"; and
(B) by striking out "class A stock as to dividends" and inserting
in lieu thereof "class A notes as to dividends, interest pay-
ments,".
(5) Section 104(gX2)(B) of such Act (12 U.S.C. 3014(g)(2)(B)) is
amended by striking out "section 103(c)" and inserting in lieu thereof
"section 103(d)(2)(A).".
(6) The second sentence of section 104(h) of such Act (12 U.S.C.
3014(h)) is hereby repealed.
(7) The first sentence of section 104(i) of such Act (12 U.S.C. 3014(i))
is amended—
(A) by striking out "cumulative dividends on class A stock" and
inserting in lieu thereof "interest payments on class A notes";
and
(B) by striking out "class A stock in" and inserting in lieu
thereof "class A notes in".
(d) Section 107 of such Act (12 U.S.C. 3017) is amended—
(1) by striking out subsection (b); and
(2) by redesignating subsections (c) and (d) as subsections Ot))
and (c), respectively.
(e) The second sentence of section 108(b) of such Act (12 U.S.C.
3018(b)) is amended by striking out ", but so long as" and all that
follows through "class B stock in the Bank".
(f) The last sentence of section 114 of such Act (12 U.S.C. 3024) is
hereby repealed.
(g) Section 203 of such Act (12 U.S.C. 3043) is amended by striking
out "out of the Account" each place it appears therein.
(h)(1) Section 201 of the Government Corporation Control Act (31
U.S.C. 856) is amended by striking out "(7) the Rural Telephone
Bank" and all that follows through the end thereof and inserting in
lieu thereof "(7) the Rural Telephone Bank, (8) the United States
Railway Association, and (9) the National Credit Union Administra-
tion Central Liquidity Facility.".
(2) Section 302 of the Government Corporation Control Act (31
U.S.C. 867) is amended—
(A) by inserting "or" after "the Regional Banks for Coopera-
tives,"; and
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 441
(B) by striking out "or the National Consumer Cooperative
Bank,".
(3) The second sentence of section 303(d) of the Government
Corporation Control Act (31 U.S.C. 868(d)) is amended by striking out
"National Consumer Cooperative Bank,".
(4) Section 5315 of title 5, United States Code, is amended by
striking out "Director, Office of Self-Help Development and Techni-
cal Assist^ce, National Consumer Cooperative Bank.".
(i) The amendments made by subsections (b) through (h) shall take Effective date.
12 u s e 3011
effect on the day after the Final Government Equity Redemption note.
Date.
TITLE IV—THE DISTRICT OF COLUMBIA
LIMITATION ON THE AMOUNT OP FUNDS AUTHORIZED AND EXPENDED
FOR LOANS FOR CAPITAL PROJECTS
SEC. 401. (a) Subsection (c) of section 723 of the District of Columbia
Self-Govemment and Governmental Reorganization Act (D.C. Code,
sec. 47-241 note) is amended to read as follows:
"(c) Subject to the limitations contained in section 603(b), there is D.C. Code
authorized to be appropriated to make loans under this section the 47-228.
sum of $155,000,000 for the fiscal year ending on September 30,1982,
the sum of $155,000,000 for the fiscal year ending on September 30,
1983, and the sum of $155,000,000 for the fiscal year ending on
September 30,1984.".
(b) The amendment made by this section shall take effect on Effective date.
October 1,1981.
TITLE V—EDUCATION PROGRAMS Omnibus
Education
Reconciliation
SHORT TITLE Act of 1981.
SEC. 501. This title may be cited as the "Omnibus Education 20 u s e 3489
Reconciliation Act of 1981". note.
Subtitle A—Authorization Savings for Fiscal Years
1982,1983, and 1984
EFFECT ON OTHER LAWS; GENERAL RESTRICTIONS
SEC. 502. (a) Any provision of law which is not consistent with the 20 u s e 3489
provisions of this subtitle is hereby superseded and shall have only note.
such force and effect during each of the fiscal years 1982,1983, and
1984 which is consistent with this subtitle.
(b) Notwithstanding any authorization of appropriations for fiscal
year 1982, 1983, or 1984 contained in any provision of law which is
specified in this subtitle (including any authorization of appropri-
ations contained in section 528 of this title), no funds are authorized
to be appropriated in excess of the limitations imposed upon appro-
priations by the provisions of this subtitle.
(c) No funds are authorized to be appropriated for the fiscal year
1982, 1983, or 1984 to pay for the expenses of any advisory council
which provides advice to a program for which there are no authoriza-
tions of appropriations made under this subtitle or made by an
amendment made by this subtitle.
95 STAT. 442 PUBLIC LAW 97-35—AUG. 13, 1981
ACT OF MARCH 2, 1867 (HOWARD UNIVERSITY)
20 use 123 note. SEC. 503. The total amount of appropriations to carry out the Act of
March 2,1867 (14 Stat. 439), shall not exceed $145,200,000 for each of
the fiscal years 1982,1983, and 1984.
A C T O F SEPTEMBER 2 3 , 1950 (IMPACT AID)
SEC. 504. The total amount of appropriations to carry out the Act of
20 use 631 note. September 23,1950 (Public Law 815,81st Congress), shall not exceed
$20,000,000 for each of thefiscalyears 1982,1983, and 1984.
ACT OF SEPTEMBER 30, 1950 (IMPACT AID)
SEC. 505. (aXD The total amount of appropriations to make pay-
20 use 237 note, ments under the Act of September 30, 1950 (Public Law 874, 81st
Congress), shall not exceed $455,000,000 for each of the fiscal years
1982,1983, and 1984 of which—
(A) $10,000,000 shall be available for payments under section 2
ofsuchAct;and
(B) $10,000,000 shall be available for payments under section 7
of such Act.
20 use 237. Funds available for section 2 of such Act for each such fiscal year
shall also be available for section 16 of the Act of September 23,1950
20 use 646. (Public Law 815,81st Congress).
20 use 238. (2) Section 3(dX2) of such Act is amended by adding at the end
thereof the following new subparagraph:
"(EXi) The amount of the entitlement of any local educational
agency under this section for fiscal year 1982 with respect to children
determined under subsection (b) with respect to such agency shall be
the amount determined under paragraph (1) with respect to such
children multiplied by 66% per centum.
'Xii) The amount of the entitlement of any local educational agency
under this section for fiscal year 1983 with respect to children
determined under subsection (b) with respect to such agency shall be
the amount determined under paragraph (1) with respect to such
children multiplied by 33 Va per centum.
"(iii) The amount of the entitlement of any local educational
agency under this section for fiscal year 1984 or any succeeding fiscal
year with respect to children determined under subsection (b) with
respect to such agency shall be zero.".
20 use 237 note. (3) If the amount appropriated for making pa3anents under such
Act for fiscal year 1982,1983, or 1984 is not sufficient to pay in full the
20 use 237. sum of the entitlements established under section 2 of such Act, then
the amount of each such entitlement shall be ratably reduced. If, for
any fiscal year in which such a reduction is required, additional
amounts are made available for making such payments, then such
entitlements shall be increased on the same basis as they were
reduced.
20 use 238 note. (b) No funds are authorized to be appropriated for fiscal year 1982,
1983, or 1984 for the purpose of making payments—
(1) on the basis of entitlements determined under section 3(e)
20 use 238, 239. or 4 of such Act; or
94 Stat. 1500. (2) under sections 4A or 6 of such Act.
20 use 239a, ^^^i^ Subsection (d) of section 402 of the Act of September 30,1950
20 use 243. (Public Law 874, 81st Congress), shall not apply during fiscal year
1982, or any succeedingfiscalyear.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 443
(2) Funds appropriated to the Department of Defense shall be 20 u s e 241 note.
available to the Secretary of Defense for payments and arrangements
of the khid that may be made by the Secretary of Education under
section 6 of the Act of September 30, 1950 (Public Law 874, 81st 20 u s e 241.
Congress).
(3) The Secretaiy of Defense shall delegate to the Secretary of 20 u s e 241 note.
Education responsibility for the conduct of programs with funds so
available.
ADULT EDUCATION ACT
SEC. 506. The total amount of appropriations to carry out the Adult 20 u s e 1211
Education Act shall not exceed $100,000,000 for each of the fiscal note.
years 1982,1983, and 1984. 20 u s e 1201
note.
ALCOHOL AND DRUG ABUSE EDUCATION ACT
SEC. 507. The total amount of appropriations to carry out the 21 u s e 1002
Alcohol and Drug Abuse Education Act shall not exceed $3,000,000 note.
for fiscal year 1982. 21 u s e 1001
note.
CAREER EDUCATION INCENTIVE AC?!
SEC. 508. The total amount of appropriations to carry out the 20 u s e 2603
Career Education Incentive Act shall not exceed $10,000,000 for fiscal note.
year 1982. 20 u s e 2601
CIVIL RIGHTS ACT OF 1964 note.
SEC. 509. The total amount of appropriations to carry out sections 42 u s e 2000C-2
403, 404, and 405 of title IV of the Civil Rights Act of 1964 (42 U.S.C. note.
2000c et seq.) shall not exceed $37,100,000 for each of the fiscal years
1982,1983, and 1984.
DEPARTMENT OP EDUCATION
SEC. 510. The total amount of appropriations for salaries and Appropriation
authorization.
expenses of the Department of Education shall not exceed 20 u s e 3488
$308,000,000 for each of the fiscal years 1982, 1983, and 1984, of note.
which—
(1) $49,396,000 shall be available for the Office of Civil Rights;
and
(2) $12,989,000 shall be available for the Office of the Inspector
General;
for each such year.
EDUCATION AMENDMENTS OF 1978
SEC. 511. (a) No funds are authorized to be appropriated to carry out
section 1015 of the Education Amendments of 1978 for fiscal year 94 Stat. 1497.
1982,1983, or 1984. 20 u s e 236 note.
(b)(1) No funds are authorized to be appropriated to carry out part
A of title XV of the Education Amendments of 1978 for fiscal year 22 u s e 287 note.
1982,1983, or 1984.
(2) No funds are authorized to be appropriated to carry out part B of 20 u s e 1123
title XV of the Education Amendments of 1978 for fiscal year 1982, note.
1983, or 1984. 20 u s e 1172
(3) The total amount of appropriations to carry out section 1524 of note.
the Education Amendments of 1978 relating to general assistance for 92 Stat. 2379.
the Virgin Islands shall not exceed $2,700,000 for each of the fiscal
years 1982,1983, and 1984.
95 STAT. 444 PUBLIC LAW 97-35—AUG. 13, 1981
20 u s e 1231a (4) No funds are authorized to be appropriated to carry out section
note.
1526 of the Education Amendments of 1978 for fiscal year 1982,1983,
or 1984.
EDUCATION AMENDMENTS OF 1980
SEC. 512. (a) No funds are authorized to be appropriated to carry out
94 Stat. 1499. part D of title XIII of the Education Amendments of 1980 for fiscal
20 u s e 1221-1 year 1982,1983, or 1984.
note.
(b) No funds are authorized to be appropriated to carry out part H
94 Stat. 1502. of title XIII of the Education Amendments of 1980 for fiscal year 1982,
1983, or 1984.
E L E M E N T A R Y A N D SECONDARY E D U C A T I O N ACT O P 1965
20 u s e 2702 SEC. 513. (a) The total amount of appropriations to carry out title I
note. of the Elementary and Secondary Education Act of 1965 shall not
20 u s e 2701. exceed $3,480,000,000 for fiscal year 1982. From the amount appropri-
ated in accordance with the preceding sentence, not more than 14.6
percent of such amount for fiscal year 1982 shall be available to carry
20 u s e 2761, out sections 141, 146, and 151, of such Act. After the requirement of
2771, 2781. the preceding sentence is met, the Secretary of Education shall
20 u s e 2722. assure that the amount available for section 117 of such Act bears the
same ratio to the amount appropriated in such fiscal year for title I of
such Act as the amount available for such section 117 in fiscal year
1980 bore to the total amount appropriated for title I of such Act in
fiscal year 1980.
Ob) The total amount of appropriations to carry out title II of the
20 u s e 2921 Elementary and Secondary Education Act of 1965 shall not exceed
note. $31,500,000 for fiscal year 1982.
(c)(1) The total amount of appropriations to carry out section 303 of
20 u s e 2943 the Elementary and Secondary Education Act of 1965 shall not
note. exceed $25,500,000 for fiscal year 1982.
(2) The total amount of appropriations to carry out part B of title III
20 u s e 2954 of such Act shall not exceed $1,380,000 for fiscal year 1982.
note. (3) The total amount of appropriations to carry out part C of title III
20 u s e 2963 of such Act shall not exceed $3,150,000 for fiscal year 1982.
note. (4) No funds are authorized to be appropriated to carry out part D of
20 u s e 2971
note.
title III of such Act for fiscal year 1982.
(5) The total amount of appropriations to carry out part E of title III
20 u s e 2983 of such Act shall not exceed $3,600,000 for fiscal year 1982.
note. (6) No funds are authorized to be appropriated to carry out part F of
20 u s e 2992 title III of such Act for fiscal year 1982.
note. (7) The total amount of appropriations to carry out part G of title III
20 u s e 3003 of such Act shall not exceed $1,000,000 for fiscal year 1982.
note. (8) No funds are authorized to be appropriated to carry out part H
20 u s e 3018 of title III of such Act for fiscal year 1982.
note. (9) No funds are authorized to be appropriated to carry out part I of
20 u s e 3024 title III of such Act for fiscal year 1982.
note. (10) No funds are authorized to be appropriated to carry out part J
20 u s e 3034 of title III of such Act for fiscal year 1982.
note.
(11) No funds are authorized to be appropriated to carry out part K
20 u s e 3041 of title III of such Act for fiscal year 1982.
note.
(12) The total amount of appropriations to carry out part L of title
20 u s e 3057 III of such Act shall not exceed $3,000,000 for fiscal year 1982.
note.
(13) No funds are authorized to be appropriated to carry out part M
20 u s e 3062 of title III of such Act for fiscal year 1982.
note. (14) No funds are authorized to be appropriated to carry out part N
94 Stat. 1471. of title III of such Act for fiscal year 1982.
20 u s e 3065
note.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 445
(d)(1) The total amount of appropriations to carry out part B of title
IV of the Elementary and Secondary Education Act of 1965 shall not 20 u s e 3101
note.
exceed $161,000,000 for fiscal year 1982.
(2) The total amount of appropriations to carry out part C of title IV
of such Act shall not exceed $66,130,000 for fiscal year 1982. 20 u s e 3111
(3) The total amount of appropriations to carry out part D of title IV note.
of such Act shall not exceed $15,000,000 for fiscal year 1982. 20 u s e 3121
(e)(1) The total amount of appropriations to carry out part B of title note.
V of the Elementary and Secondary Education Act of 1965 shall not 20 u s e 3163
exceed $42,075,000 for fiscal year 1982. note.
(2) No funds are authorized to be appropriated to carry out part C of
title V of such Act for fiscal year 1982. 20 u s e 3171
(f) The total amount of appropriations to carry out title VI of the note.
Elementary and Secondary Education Act of 1965 shall not exceed 20 u s e 3194
note.
$149,292,000 for fiscal year 1982.
(g) The total amount of appropriations to carry out title VII of the
Elementary and Secondary Education Act of 1965 shall not exceed 20 u s e 3222
$139,970,000 for each of the fiscal years 1982, 1983, and 1984. note.
(h) The total amount of appropriations to carry out title VIII of the
Elementary and Secondary Education Act of 1965 shall not exceed 20 u s e 3282
$3,138,000 for fiscal year 1982. note.
(i)(l) The total amount of appropriations to carry out part A of title
IX of the Elementary and Secondary Education Act of 1965 shall not 20 u s e 3313
exceed $5,652,000 for fiscal year 1982. note.
(2) No funds are authorized to be appropriated to carry out part B of
title IX of such Act for fiscal year 1982. 20 u s e 3331
(3) The total amount of appropriations to carry out part C of title IX note.
of such Act shall not exceed $6,000,000 for each of the fiscal years 20 u s e 3348
1982,1983, and 1984. note.
(4) No funds are authorized to be appropriated to carry out part D of
title IX of such Act for fiscal year 1982. 20 u s e 3352
(5) The total amount of appropriations to carry out part E of title IX note.
of such Act shall not exceed $2,250,000 for fiscal year 1982. 20 u s e 3367
(j)(l) Funds appropriated in an appropriation Act for fiscal year note.
1982 for title I of the Elementary and Secondary Education Act of
1965 which are intended for use by a State or local educational agency 20 u s e 2702
in the school year 1982-1983 shall remain available to such agency note.
but shall be expended and used in accordance with chapter 1 of the
Education Consolidation and Improvement Act of 1981. Post, p. 464.
(2) Funds appropriated in an appropriation Act for fiscal year 1981
for title I of the Elementary and Secondary Education Act of 1965
which are not obligated by a State or local educational agency prior to
July 1, 1982, shall remain available to such agency but shall be
expended and used in accordance with chapter 1 of the Education
Consolidation and Improvement Act of 1981.
EDUCATION CONSOLIDATION AND IMPROVEMENT ACT OF 1981
SEC. 514. (a)(1) The total amount of appropriations to carry out 20 u s e 3802
chapter 1 of the Education Consolidation and Improvement Act of note.
1981 shall not exceed $3,480,000,000 for each of the fiscal years 1983
and 1984.
(2) From the amount appropriated in accordance with the para-
graph (1), not more than 14.6 percent of such amount for each of the
fiscal years 1983 and 1984 shall be available to carry out programs
described in sections 141, 146, and 151 of the Elementary and
Secondary Education Act of 1965. After the requirement of the 20 u s e 2761,
preceding sentence is met, the Secretary of Education shall assure 2771, 2781.
95 STAT. 446 PUBLIC LAW 97-35—AUG. 13, 1981
that the amount available for the programs described in section 117
20 u s e 2722. of the Elementary and Secondary Education Act of 1965 bears the
same ratio to the amount appropriated in each such fiscal year for
chapter 1 of the Education Consolidation and Improvement Act of
Post, p. 464. 1981 as the amount available for such section 117 in fiscal year 1980
bore to the total amount appropriated for title I of the Elementary
20 u s e 2701 and Secondary Education Act of 1965 in fiscal year 1980.
(bXD The total amount of appropriations to carry out chapter 2 of
Post, p. 469. the Education Consolidation and Improvement Act of 1981 shall not
exceed $589,368,000 for each of the fiscal years 1982,1983, and 1984.
(2XA) Funds appropriated in an appropriation Act for fiscal year
1982 for any program described in section 561(a) (1), (2), (3), (5), and (6)
Post, p. 469. of this Act which are intended for use by a State or local educational
agency in the school year 1982-1983 shall remain available to such
agency but shall be expended and used in accordance with chapter 2
of the Education Consolidation and Improvement Act of 1981.
(B) Funds appropriated in an appropriation Act for fiscal year 1981
for any program described in section 561(a) (1), (2), (3), (5), and (6) of
this Act which are not obligated by a State or local educational
agency prior to July 1, 1982, shall remain avsiilable to such agency
but shall be expended and used in accordance with chapter 2 of the
Education (Consolidation and Improvement Act of 1981.
GENERAL EDUCATION PROVISIONS ACT
SEC. 515. (a) The total amount of appropriations to carry out section
94 Stat. 1498. 405 of the (Jeneral Education Provisions Act shall not exceed
20 u s e 1221e $55,614,000 for each of the fiscal years 1982,1983, and 1984.
note.
(b) The total amount of appropriations to carry out section 406 of
20 u s e 1221e-l the Genered Education Provisions Act shall not exceed $8,947,000 for
note. each of the fiscal years 1982,1983, and 1984.
(c) The total amount of appropriations to carry out section 406A(1)
20 u s e 1221e-la of the General Education Provisions Act shall not exceed $1,875,000
note. for fiscal year 1982.
(d) The total amount of appropriations to carry out section 406A(2)
of the General Education Provisions Act shall not exceed $5,000,000
for each of the fiscal years 1982,1983, and 1984.
HIGHER EDUCATION ACT OF 1965
SEC. 516. (aXD No funds are authorized to be appropriated to carry
94 Stat. 1373. out part A of title I of the Higher Education Act of 1965 for fiscal year
20 u s e 1005 1982,1983, or 1984.
note.
(2) The total amount of appropriations to carry out part B of title I
94 Stat. 1377. of such Act shall not exceed $8,000,000 for fiscal year 1982, 1983, or
20 u s e 1019 1984.
note.
(bXD The total amount of appropriations to carry out part A of title
94 Stat. 1384. II of the Higher Education Act of 1965 shall not exceed $5,000,000 for
20 u s e 1029 each of the fiscal years 1982,1983, and 1984.
note.
(2) The total amount of appropriations to carry out part B of title II
94 Stat. 1385. of such Act shall not exceed $1,200,000 for each of the fiscal years
20 u s e 1031 1982,1983, and 1984.
note.
(3) The total amount of appropriations to carry out part C of title II
94 Stat. 1386. of such Act shall not exceed $6,000,000 for each of the fiscal years
20 u s e 1041 1982,1983, and 1984.
note.
(4) No funds are authorized to be appropriated to carry out part D of
20 u s e 1047J title II of such Act for fiscal year 1982,1983, or 1984.
note.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 447
(5) No funds available for carrying out part A and section 224 of
part B of such title for any such fiscal year shall be made available to 94 Stat. 1384,
any institution, organization, or agency which is a recipient of 1385.
assistance under part C of such title. 20 use 1029
note.
(cXD The total amount of appropriations to carry out title III of the 94 Stat. 1386.
Higher Education Act of 1965 shall not exceed $129,600,000 for each 20 use 1041.
94 Stat. 1390.
of the fiscal years 1982,1983, and 1984.
(2) Section 381(a)(1) of the Higher Education Act of 1965 is amended 20 use 1069c
note.
by striking out the period at the end of clause (B) and by inserting in 1395.
94 Stat. 1064.
lieu thereof a semicolon and the word "or", and by adding at the end 20 use
thereof the following new clause:
"(C) which is an institution of higher education which includes
a substantial number of minority and educationally disadvan-
taged students, which provides a medical education program
which leads to a doctor of medicine degree or which is not less
than a two year program fully acceptable toward such a degree,
and which in fiscal year 1980 received a grant as a two year
medical school under section 788(a) of the Health Professions
Educational Assistance Act of 1976.". 42 u s e 295g-8.
(d)(1)(A) The total amount of appropriations to carry out subpart 1
of part A of title IV of the Higher Education Act of 1965 shall not 20 u s e 1070a
exceed $2,650,000,000 for fiscal year 1982, $2,800,000,000 for fiscal note.
year 1983, and $3,000,000,000 for fiscal year 1984.
(B) If the Secretary of Education determines that it is necessary to Waiver
waive any provision of subpart 1 of part A of title IV of the Higher notification to
congressional
Education Act of 1965 to meet the authorizations specified in subpar- committees.
agraph (A) of this paragraph, the Secretary shall notify the Commit-
tee on Labor and Human Resources of the Senate and the Committee
on Education and Labor of the House of Representatives. The
notification shall contain a description of each provision of such
subpart that the Secretary proposes to waive and the reasons for the
waiver. The Secretary may waive each provision contained in the
notification submitted under this subparagraph if the Committee on
Labor and Human Resources of the Senate and the Committee on
Education and Labor of the House of Representatives within 30 days
after the receipt approve of the waiver of that provision. Before the
Secretary may act under this subparagraph, each such committee
must approve of the waiver of each provision requested in the
notification.
(2) The total amount of appropriations to carry out subpart 2 of part
A of title IV of such Act shall not exceed $370,000,000 for each of the 20 u s e 1070b
fiscal years 1982,1983, and 1984. note.
(3) The total amount of appropriations to carry out subpart 3 of part
A of title IV of such Act shall not exceed $76,800,000 for each of the 20 u s e 1070c
fiscal years 1982,1983, and 1984. note.
(4) The total amount of appropriations to carry out subpart 4 of part
A of title IV of such Act shall not exceed $165,000,000 for the fiscal 94 Stat. 1407.
year 1982, $170,000,000 for each of the fiscal years 1983 and 1984. 20 u s e 1070d
note.
(5) The total amount of appropriations to carry out subpart 5 of part
A of title IV of such Act shall not exceed $7,500,000 for each of the 94 Stat. 1411.
fiscal years 1982,1983, and 1984. 20 u s e 1070d-2
note.
(6)(A) No funds are authorized to be appropriated to carry out
section 419 of such Act for fiscal year 1982,1983, or 1984. 20 u s e 1070e
(B) The total amount of appropriations to carry out section 420 of note.
such Act shall not exceed $12,000,000 for each of the fiscal years 1982, 94 Stat. 1412.
1983, and 1984. 20 u s e 1070e-l
note.
95 STAT. 448 PUBLIC LAW 97-35—AUG. 13, 1981
(7) The total amount of appropriations to carry out part C of title IV
94 Stat. 1433. of such Act shall not exceed $550,000,000 for each of the fiscal years
42 u s e 2751
note. 1982,1983, and 1984.
(8) The total amount of appropriations to carry out part E of title IV
94 Stat. 1437. of such Act shall not exceed $286,000,000 for each of the fiscal years
20 u s e 1087aa 1982,1983, and 1984.
note.
(9) The total amount of appropriations to carry out section 491 of
94 Stat. 1454. such Act shall not exceed $1,000,000 for fiscal year 1982 and
20 u s e 1098 $2,000,000 for fiscal year 1983.
note.
(e)(1) The total amount of appropriations to carry out part A of title
94 Stat. 1459. V of the Higher Education Act of 1965 shall not exceed $22,500,000 for
20 u s e 1101
note. fiscal year 1982.
(2)(A) The total amount of appropriations to carry out part B of title
94 Stat. 1459. V of such Act shall not exceed $9,100,000 for fiscal year 1982.
20 u s e 1119 (B) The last sentence of section 531 of such Act shall not apply to
note.
the funds appropriated to carry out part B of title V of such Act for
fiscal year 1982,1983, or 1984.
(3) No funds are authorized to be appropriated to carry out part C of
94 Stat. 1461. title V of such Act for fiscal year 1982,1983, or 1984.
20 u s e 1119b-5
note. (4) No funds are authorized to be appropriated to carry out part D of
94 Stat. 1464. title V of such Act for fiscal year 1982,1983, or 1984.
20 u s e 1119c (f) The total amount of appropriations to carry out title VI of the
note. Higher Education Act of 1965 shall not exceed $30,600,000 for each of
94 Stat. 1464.
20 u s e 1127 thefiscalyears 1982,1983, and 1984.
note. (g) No funds are authorized to be appropriated to carry out part A
94 Stat. 1472. or B of title VII of the Higher Education Act of 1965 for fiscal year
20 u s e 1132a-l
note. 1982,1983, or 1984.
(h) The total amount of appropriations to carry out title VIII of the
94 Stat. 1481. Higher Education Act of 1965 shall not exceed $20,000,000 for each of
20 u s e 1133
note. thefiscalyears 1982,1983, and 1984.
(i)(l) No funds are authorized to be appropriated to carry out part A
20 u s e 1134 of title IX of such Act for fiscal year 1982,1983, or 1984.
note.
(2) The total amount of appropriations to carry out part B of title IX
94 Stat. 1482. of the Higher Education Act of 1965 shall not exceed $14,000,000 for
20 u s e 1134g each of the fiscal years 1982,1983, and 1984.
note.
(3) No funds are authorized to be appropriated to carry out part C of
94 Stat. 1484. title IX of such Act for fiscal year 1982,1983, or 1984.
20 u s e 1134h
note. (4) The total amount of appropriations to carry out part D of title IX
94 Stat. 1486. of such Act shall not exceed $1,000,000 for each of the fiscal years
20 u s e 1134m 1982,1983, and 1984.
note. (5) The total amount of appropriations to carry out part E of title IX
94 Stat. 1487. of such Act shall not exceed $1,000,000 for each of the fiscal years
20 u s e 1134p 1982,1983, and 1984.
note.
(j) The total amount of appropriations to carry out title X of the
94 Stat. 1489. Higher Education Act of 1965 shall not exceed $13,500,000 for each of
20 u s e 1135a-3 the fiscal years 1982,1983, and 1984.
note.
INDIAN EDUCATION ACT
20 u s e 241ff SEC. 517. The total amount of appropriations to carry out the
note.
20 u s e 241aa Indian Education Act shall not exceed $81,700,000 for fiscal year
note. 1982, $88,400,000 for the fiscal year 1983, and $95,300,000 for the
fiscal year 1984.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 449
JOHNSON-O'BIALLEY ACT; SNYDER ACT; NAVAJO COMMUNITY COLLEGE ACT;
TRIBALLY CONTROLLED COMMUNITY COLLEGE ASSISTANCE ACT OF 1978
SEC. 518. The total amount of appropriations— 25 u s e 13 note.
(1) to carry out the Act of April 16» 1934» commonly referred to
as the JohnsonO'Mallev Act; 25 use 452
(2) to carry out all education programs under the direction of "o*®
the Office of Indian Education Pn^rams in the Bureau of Indian
Affairs of the Department of the mterior authorized under the
Act of November 2,1921, commonly referred to as the Snyder Act 25 use 13.
(and not otherwise expressly authorized by law);
(3) to carry out the Navsyo Community College Act; and 25use640a
(4) to carry out the Tribally Controlled Community College "^^
Assistance Actof 1978; 25 use 1801
shall not exceed $262,300,000 for fiscal year 1982, $276,100,000 for the '^"^
fiscal year 1983, and $290,400,000 forfiscalyear 1984.
JOINT RESOLUTION OF OCTOBER 19, 1972 (ELLENDER FELLOWSHIP
PROGRAM)
SEC. 519. The total amount of appropriations to carry out the joint
resolution of October 19,1972, shall not exceed $1,000,000 for each of 86 stat. 907.
thefiscalyears 1982,1983, and 1984.
LIBRARY SERVICES AND CONSTRUCTION ACT
SEC. 520. (a) The total amoimt of appropriations to carry out the 20 u s e 351b
Library Services and Construction Act shidl not exceed $80,000,000 «« TTQP or. „^.^
for eachof thefiscalyears 1982,1983,and 1984of which— ^" ^^ ^^^ ''°^-
(1) not more than $65,000,000 shall be available for title I of
such Act; and 20 use 352.
(2) not more than $15,000,000 shall be available for title m of
such Act, 20USe355e.
for each such year.
(b) No funds are authorized to be appropriated to carry out title n of
the Library Services and Construction Act for fiscal year 1982,1983, 20 use 355a.
or 1984.
BfUSEUM SERVICES ACT
SEC. 521. The total amount of appropriations to carry out the 20 use 96? note.
Museum Services Act shall not exceed $9,600,000 for each of the fiscal 20 use 96i note.
years 1982,1983, and 1984.
NATIONAL COMBOSSION ON LIBRARIES AND INFORBfATION SCIENCE ACT
SEC. 522. The total amount of appropriations to carry out the 20 u s e 1506
National Commission on Libraries and Information Science Act shall note.
20 u s e 1501
not exceed $700,000 for each of the fiscal years 1982,1983, and 1984. note.
NATIONAL FOUNDATION ON THE ARTS AND THE HUBIANITIES ACT OF
1965 20 u s e 951 note.
SEC. 528. The total amount of appropriations to the National 20 use 960 note.
Endowment for the Arts shall not exceed $119,300,000 for each of the
fiscal years 1982,1983, and 1984.
SEC. 524. The total amount of appropriations to the National ^^ use 96o note.
Endowment for the Humanities shall not exceed $118,700,000 for
each of thefiscalyears 1982,1983, and 1984.
95 STAT. 450 PUBLIC LAW 97-35—AUG. 13, 1981
REFUGEE EDUCATION CONSOLIDATION
SEC. 525. The total amount of appropriations to carry out titles I
94 Stat. through IV of the Refugee Education Assistance Act of 1980 shall not
1799-1807. exceed $5,000,000 for fiscal year 1982, $7,500,000 for fiscal year 1983,
8 u s e 1522 note. and $10,000,000 for fiscal year 1984.
REFUGEE CUBAN AND HAITIAN PROGRAMS
8 use 1522 note. SEC. 526. (aXD The total amount of appropriations to carry out
Cuban and Haitian reception activities shall not exceed $20,000,000
for fiscal year 1982.
(2) No funds are authorized to be appropriated to Cuban and
Haitian reception activities for the fiscal year 1983.
(b) The total amount of appropriations to carry out Cuban and
Haitian domestic activities shall not exceed $94,000,000 for fiscal year
1982 and $59,000,000 for fiscal year 1983.
VOCATIONAL EDUCATION ACT OF 1963
20 u s e 2302 SEC. 527. The total amount of appropriations to carry out the
note. Vocational Education Act of 1963 shall not exceed $735,000,000 for
20 u s e 2301
note. each of the fiscal years 1982,1983, and 1984.
GENERAL EXTENSION OF AUTHORIZATIONS
20 u s e 3489. SEC. 528. Subject to the limitations contained in subtitle A of this
title, there are authorized to be appropriated for fiscal years 1982,
1983, and 1984 such sums as may be necessary to carry out each of the
following provisions of law:
20 u s e 236 et (1) the Act of September 30, 1950 (Public Law 874, 81st
seq.
Congress);
20 u s e 631 et (2) the Act of September 23, 1950 (Public Law 815, 81st
seq. Congress);
20 u s e 1221. (3) the (General Education Provisions Act;
20 u s e 241aa. (4) the Indian Education Act;
(5) titles XI, XIV, and XV of the Education Amendments of
92 Stat. 2313, 1978 and part H of title XIII of the Education Amendments of
2365, 2373. 1980;
94 Stat. 1502.
20 u s e 1201 (6) the Adult Education Act;
note. (7) section 342 of the Education Amendments of 1976;
20 u s e 2532. (8) the Asbestos School Hazards Detection and Control Act;
94 Stat. 487. (9) the Joint Resolution of October 19, 1972 (86 Stat. 907);
20 u s e 3601
note. (10) the Vocational Education Act of 1963;
20 u s e 2301 (11) title IV of the Civil Rights Act of 1964;
note. (12) the Library Services and Construction Act;
42 u s e 2000c.
25 u s e 351 note. (13) the Navajo Community College Act and the Tribally
25 u s e 640a. Controlled Community College Assistance Act of 1978; and
note. (14) part C of title IX of the Elementary and Secondary
20 u s e 1801 Education Act of 1965, relating to Women's Educational Equity.
note.
20 u s e 3341.
Postsecondary Subtitle B—Student Assistance Provisions
Student
Assistance
Amendments SHORT TITLE
of 1981.
20 u s e 1001 SEC. 531. This subtitle may be cited as the "Postsecondary Student
note. Assistance Amendments of 1981".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 451
ELIGIBIUTY FOR SUBSIDIZED LOANS
SEC. 582. (a) Section 428(aX2) of the Higher Education Act of 1965 20 u s e 1078.
(hereafter in this subtitle referred to as the "Act") is amended to read
as follows:
"(2XA) Each student qualifying for a portion of an interest payment
under paragraph (1) s h ^ —
"(i) have provided to the lender a statement from the eligible
institution, at which the student has been accepted for enroll-
ment, or at which the student is in attendance, which—
"(I) sets forth such student's estimated cost of attendance;
and
"(II) sets forth such student's estimated financial assist-
ance; and
"(ii) meet the requirements of subparagraph (B).
"(B) For the purpose of clause (ii) of subparagraph (A), a student
shall qualify for a portion of an interest pajnnent under paragraph (1)
if the adjusted gross income of such student's family—
"(i) is less than or equal to $30,000; or
"(ii) is greater than $30,000, and the eligible institution has
provided the lender with a statement evidencing a determination
of need for a loan and the amount of such need, subject to the
provisions of subparagraph (F).
"(C) For the purpose of paragraph (1) and this paragraph—
"(i) a student's estimated cost of attendance means, for the
period for which the loan is sought, the tuition and fees applica-
ble to such student together with the institution's estimate of
other expenses regisonably related to attendance at such institu-
tion, including, but not limited to, the cost of room and board,
reasonable transportation costs, and costs for books and supplies;
"(ii) a student's estimated financial assistance means, for the
period for which the loan is sought, the amount of assistance
such student will receive under subparts 1 and 2 of part A, and
parts C and E of this title, any amount paid under the Social 20 u s e 1070a,
1070b;
Security Act to, or on account of, the student which would not be 42 u s e 2751;
paid if he were not a student, and any amount paid the student 20 u s e 1087aa.
under chapters 32,34, and 35 of title 38, United States Code, plus 42 u s e 1305.
other scholarship, grant, or loan assistance; and 38 u s e 1601 et
seq., 1651 et seq.,
"(iii) the determination of need and of the amount of a loan by 1700 et seq.
an eligible institution under subparagraph (B)(ii) with respect to
a student shall be calculated by subtracting from the estimated
cost of attendance at the eligible institution the total of the
expected family contribution with respect to such student plus
any estimated financial assistance reasonably available to such
student.
"(D) The Secretary shall submit a separate schedule of expected Schedule of
expected
family contributions to the President of the Senate and the Speaker family
of the House of Representatives not later than the submission of, and contributions.
in accordance with the procedures for, the proposed schedule of 94 Stat. 1445.
expected family contributions under section 482, except as provided 20 u s e 1089.
in subparagraph (E).
"(E)(i) The initial separate schedule required by subparagraph (D)
shall—
"(I) be submitted not later than August 15,1981;
"(II) be effective on October 1, 1981, except £is is otherwise
provided in division (ii);
95 STAT. 452 PUBLIC LAW 97-35—AUG. 13, 1981
"(Ill) not be the subject of public comment otherwise required
94 Stat. 1445. by section 482(a)(1) of this Act or section 431 of the General
20 u s e 1089. Education Provisions Act; and
20 u s e 1232.
"(IV) be subject to amendment prior to the next regular
submission of a separate schedule as required by subparagraph
(D) only in accordance with division (iv) of this subparagraph.
Congressional "(ii) If either the Senate or the House of Representatives adopts,
disapproval. prior to October 1, 1981, a resolution of disapproval of the schedule
submitted under division (i), such schedule shall not take effect. If
such schedule is so disapproved, or if the Secretary does not submit
such a schedule by August 15, 1981, then beginning on October 1,
1981, the expected family contribution for purposes of this paragraph
shall be determined by the eligible institution in accordance with
20 u s e 1070a, regulations promulgated under section 411 or 413B, as in effect for
1070b-l. the period beginning on July 1,1981, governing the determination of
expected family contribution.
(iii) The method of determining the expected family contribution
established under this subparagraph shall remain in effect until
superseded by the taking effect of the next schedule submitted in
accordance with subparagraph (D) or amended in accordance with
division (iv) of this subparagraph.
"(iv) Any amendment promulgated by the Secretary to the initial
separate schedule established under this subparagraph shall be
transmitted to the President of the Senate and the Speaker of the
House of Representatives not later than the time of its publication in
the Federal Register. If either the Senate or House of Representatives
adopts, within 30 legislative days following the publication of such
amendment, a resolution of disapproval of such amendment, such
amendment shall not take effect.
"(F) For the purpose of a student described in clause (ii) of
subparagraph (B), the amount of the loan which is qualified for a
payment under paragraph (1) is the amount of the need of such
student as determined by the eligible institution, except that, if the
amount of need is equal to or more than $500, but is less than $1,000,
the amount of the loan which is qualified for such payment shall be
$1,000.".
20 u s e 1078. (b)(1) Section 42803)(l)(A)(i) of the Act is amended by striking out
"section 428(a)(2)(B)(i)" and inserting in lieu thereof "section
428(a)(2)(C)(i)".
Repeal. (2) Section 439B of the Act is repealed. Nothing in this paragraph or
20 u s e 1087-3a, in any other provision of this title, or in any provision of the Higher
1078 note.
20 u s e 1001 Education Act of 1965 as amended by this title, shall be construed to
note. permit any analysis of need for the purposes of loans under part B of
20 u s e 1071. title IV of such Act other than that expressly required by section
428(a)(2) of such Act as amended by this section or to require a
student seeking to qualify under section 428(a)(2)(B)(i) to prove any
element of need other than compliance with the adjusted gross
income amount specified in such section.
94 Stat. 1424. (3) Section 428B03)(3) of the Act is amended by striking out "No"
20 u s e 1078-2. and inserting in lieu thereof "Any loan under this section may be
counted as part of the student's expected family contribution in the
determination of need under this title, but no".
94 Stat. 1425. (4) Section 438G3)(5) of the Act is amended to read as follows:
20 u s e 1087-1. "(5) As used in this section, the term 'eligible loan' means a loan—
"(A)(i) on which a portion of the interest is paid on behalf of the
student and for his account to the holder of the loan under
section 428(a);
94 Stat. 1430. "(ii) which is made under section 428B or 439(o); or
20 u s e 1087-2.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 453
"(iii) which was made prior to October 1,1981; and
"(B) which is insured under this part, or made under a program
covered by an agreement under section 428(b) of this Act.". 20 use 1078.
NEED ANALYSIS AMENDMENTS
SEC. 533. (a)(1) Section 482(a)(1) of the Act is amended by striking 94 Stat. 1445.
20 u s e 1089.
out everything after the comma following the words "family income,
which," and inserting in lieu thereof the following: "together with
any amendments published in the Federal Register, no later than
September 1,1981, June 1,1982, and J u n e 1 of each succeeding year,
shall become effective July 1 of the calendar year which succeeds
such calendar year, except as is otherwise provided in paragraph (2).
During the thirty-day period following publication of a schedule the
Secretary shall provide interested parties with an opportunity to
present their views and make recommendations with respect to such
schedule. Such schedule shall be adjusted annually.".
(2) Section 482(a)(2) of the Act is amended to read as follows: New or revised
"(2) The schedule of expected family contributions required for schedules,
congressional
each academic year, including any amendments thereto published disapproval.
pursuant to paragraph (1), shall be transmitted to the President of
the Senate and the Speaker of the House of Representatives not later
than the time of its publication in the Federal Register. If either the Publication in
Senate or House of Representatives adopts, prior to October 15,1981, Federal
Register.
July 15, 1982, or July 15 of any succeeding year, following the
submission of such schedule and any amendments thereto as re-
quired by this paragraph, a resolution of disapproval of such schedule
or amendments, in whole or in part, the Secretary shall publish a new
schedule of expected family contributions in the Federal Register not
later than fifteen days after the adoption of such resolution of
disapproval. Such new schedule shall take into consideration such
recommendations as may be made in either House in connection with
such resolution. If within fifteen days following the submission of the Publication in
revised schedule, either the Senate or the House of Representatives Federal
Register.
again adopts a resolution of disapproval, in whole or in part, of such
revised schedule, the Secretary shall publish a new schedule of
expected family contributions in the Federal Register not later than
fifteen days after the adoption of such resolution of disapproval. This
procedure shall be repeated until neither the Senate nor the House of
Representatives adopts a resolution of disapproval. The Secretary
shall publish together with each new schedule a statement identify-
ing the recommendations made in either House in connection with
such resolution of disapproval and explaining his reasons for the new
schedule.".
(3) The first sentence of section 431(d)(1) of the General Education
Provisions Act is amended by inserting after "final regulation" the 20 u s e 1232.
first time it appears the following: "(except expected family contribu-
tion schedules and any amendments thereto promulgated pursuant
to sections 428(a)(2) (D) and (E) and 482(a) (1) and (2) of the Higher
Education Act of 1965)". Ante, p. 451.
(b) Section 482(b)(4) of the Act is amended to read as follows: 94 Stat. 1445.
"(4) In determining the expected family contribution under this 20 u s e 1089.
section for any academic year after academic year 1981-1982, the
Secretary shall establish a series of assessment rates to be applied to
parental discretionary income.".
95 STAT. 454 PUBLIC LAW 97-35—AUG. 13, 1981
AUXILIARY PROGRAM
94 Stet. 1419. SEC. 534. (aXD Section 427A of the Act is amended by redesignating
20 use 1077a. subsection (c) as subsection (d) and by inserting after subsection (b)
the following:
''(cXD Except as otherwise provided in this subsection, the applica-
9ft ^TQr- ^ftls 9 ^^® ^^*® of interest on loans made pursuant to section 428B on or after
20 use 1078-2. October 1, 1981, shall be 14 per centum per anniun on the unpaid
principal balance of the loan.
''(2) If for any twelve-month period beginning on or after October 1,
1981, the Secretary, after consultation with the Secretary of the
Treasury, determines that the average of the bond equivalent rates of
ninety-one-day Treasury bills auctioned for such twelve-month
period is equal to or less than 14 per centum, the applicable rate of
i n t e r s for loans made pursuant to section 428B on and after the first
day of the first month beginning after the date of publication of such
determination shall be 12 per centum per annum on the unpaid
principal balance of the loan.
"(3) If for any twelve-month period beginning on or after the date of
publication of a determination under paragraph (2), the Secretary,
after consultation with the Secretary of the Treasury, determines
that the average of the bond equivalent rates of ninety-one-day
Treasury bills auctioned for such twelve-month period exceeds 14 per
centum, the applicable rate of interest for loans made pursuant to
section 428B on and after the first dav of the first month beginning
after the date of publication of that determination under this para-
graph shall be 14 per centum per annum on the unpaid principal
balance of the loan. .
(2) Section 428B(cX3) is amended by striking out everything after
''unpaid principal balance of the loan," and inserting in lieu thereof
the following: "except as otherwise required by section 427A(c).".
?ft i^h Iftll 1 *) Section 438(bX2) of the Act is amended—
^0 ubL io«7-i. (J) jjy striking out subparagraphs (A), (B), and (C) and inserting
in lieu thereof the following:
"(2XA) Subject to subparagraph (B) and paragraph (4), the special
allowance paid pursuant to this subsection on loans shall be com-
puted (i) by determining the average of the bond equivalent rates of
ninety-one-day Treasury bills auctioned for such three month period,
(ii) by subtracting the applicable interest rate on such loans from
such average, (iii) by ad(ung 3.5 per centum to the resultant per
centum, and (iv) by dividing the resultant per centum by four.";
(2) by redesignating subparagraph (D) as subparagraph (B); and
(3) by striking out "subparagraph (A), (B), or (C)" in subpara-
graph (B) (as so redesignated) and inserting in lieu thereof
subparagraph (A)".
(cXD Section 428B(a) of the Act is amended by inserting "(1)" after
"(a)" and by adding at the end thereof the following new paragraph:
"(2) Graduate or professional students (as defined by regulations of
the Secretary) and independent undergraduate students (as defined
94 Stat. 1445. in section 482(cX2)) shall be eligible to borrow funds under this section
20 use 1089. ijj amounts specified in subsection (b) (treating graduate and profes-
sional students as parents for the purposes of such subsection), and
unless otherwise specified in subsections (c) and (d), such loans shall
have the same terms, conditions, and benefits as all other loans made
under this part.".
Oft ^^h lani'o (2) Section 428B(b) of the Act is amended by adding at the end
^^ use 1078-2. thereof the following new paragraph:
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 455
"(4)(A) Subject to subparagraph (B) of this paragraph, the maxi-
mum amount an independent undergraduate student may borrow
under this section in any academic year or its equivalent (as defined
by regulation by the Secretary) is equal to (i) $2,500, minus (ii) the
amount of all other loans under this part to such student for such
academic year or its equivalent.
"(B) The aggregate insured unpaid principal amount for insured
loans made to an independent undergraduate student under this part
(including loans made under this section) shall not exceed $12,500.".
(3) The heading of section 428B of the Act is amended to read as
follows:
"AUXILIARY LOANS TO ASSIST STUDENTS".
INDEPENDENT STUDENT LOAN LIMITATIONS
SEC. 535. (a) Section 425(a)(1) of the Act is amended— 94 Stat. 1416.
(1) by striking out clause (A) and by redesignating clauses (B), ^^ ^SC 1075.
(C), and (D) as clauses (A), (B), and (C), respectively; and
(2) by striking out "clause (C)" in the last sentence of such
section and inserting in lieu thereof "clause (B)".
(b) Section 425(a)(2) of the Act is amended—
(1) by striking out "(other than an independent student)"; and
(2) by striking out "$15,000 in the case of any independent
student who has not successfully completed a program of under-
graduate education,".
(c) The matter preceding subdivision (i) of section 428(b)(1)(A) of the
Act is amended— Ante, p. 452.
(1) by striking out "(other than an independent student)"; and
(2) by striking out "or not more than $3,000 in the case of an
independent student (defined in accordance with section
482(c)(2)) who has not successfully completed a program of 94 Stat. 1445.
undergraduate education,". ^^ USC 1089.
(d) Section 428(b)(1)(B) of the Act is amended—
(1) by striking out "(other than an independent student)"; and
(2) by striking out "$15,000 in the case of any independent
student who has not successfully completed a program of under-
graduate education,".
(e) Section 428 A of the Act is amended— 94 Stat. 1416,
(1) by striking out ", other than an independent student," in 1417.
subsection (a)(1)(A) and in subsection (a)(2)(A); 20 USC 1078-1.
(2) by striking out "$3,000 (in the case of an independent
student (as defined in section 482(c)(2)) who has not successfully
completed a program of undergraduate education)," in each such
subsection;
(3) by striking out "(other than an independent student)" in
each such subsection; and
(4) by striking out "$15,000 in the case of any independent
student who has not successfully completed a program of under-
graduate education," in each such subsection.
ORIGINATION FEES
SEC. 536. (a) Section 438 of the Act is amended by redesignating 94 Stat. 1425.
subsection (c) as subsection (d) and by inserting after subsection (b) ^0 USC 1087-1.
the following new subsection:
"(c)(1) Notwithstanding subsection (b), the total amount of interest
and special allowance payable under section 428(a)(3)(A) and subsec- 20 USC 1078.
9-194 0—82 31 : QL3
95 STAT. 456 PUBLIC LAW 97-35—AUG. 13, 1981
tion (b) of this section, respectively, to any holder shall be reduced by
the Secretary by the amount which the lender is authorized to charge
as an origination fee in accordance with paragraph (2) of this
subsection. If the total amount of interest and special allowance
20 use 1078. payable under section 428(a)(3)(A) and subsection (b) of this section,
respectively, is less than the amount the lender was authorized to
charge borrowers for origination fees in that quarter, the Secretary
shall deduct the excess amount from the subsequent quarters' pay-
ments until the total amount has been deducted.
"(2) With respect to any loan (other than loans made under section
94 Stat. 1424, 428B and section 439(o)) for which a completed note or other written
20^TJsr 078-2 evidence of the loan was sent or delivered to the borrower for signing
1087-2 ®^ °^ after 10 days after the date of enactment of the Postsecondary
Ante, p. 450. Student Assistance Amendments of 1981, each eligible lender under
this part is authorized to charge the borrower an origination fee in an
amount not to exceed 5 per centum of the principal amount of the
loan, which may be deducted from the proceeds of the loan prior to
payment to the borrower.
"(3) Such origination fee shall not be taken into account for
94 Stat. 1419. purposes of determining compliance with section 427A.
20 use 1077a. «(4) "pj^g lender shall disclose to the borrower the amount and
method of calculating the origination fee. For any loan for which the
lender is authorized to charge an origination fee and which is made
prior to August 1,1982—
"(A) this disclosure need not meet the requirements of the
Truth in Lending Act (15 U.S.C. 1601 et seq.) or the disclosure
requirements of any State law;
"(B) for purposes of such Act, a lender may disclose either in
the note or other written evidence of the loan or in a supplemen-
tary letter (which need not be signed by the borrower);
"(C) for purposes of such Act, the origination fee shall not be
taken into account in calculating and disclosing the annual
percentage rate; and
"(D) a lender or an assignee shall not incur civil liability under
15 use 1640. section 130 of such Act nor be subject to any administrative
15 use 1607. enforcement action pursuant to section 108 of such Act for
disclosures in connection with such loans.".
20 use 1078. (b) Section 428(a)(3)(A) of the Act is amended by inserting "and
Ante, p. 455. subject to section 438(c)" after "Except as provided in paragraph (8)".
ADMINISTRATIVE SAVINGS; TECHNICAL AMENDMENTS
SEC. 537. (aXD Section 428(e) of the Act is repealed.
OA fjih }^B- (2) The first sentence of section 489(a) of the Act is amended by
20 use 1096. striking out "$10" and inserting in lieu thereof "$5".
20 use 1077. (b)(1) Section 427(c) of the Act is amended by striking out "$360"
each place it appears and inserting in lieu thereof "$600".
20 use 1078. (2) Section 428(bXlXL) of the Act is amended by striking out "$360"
each place it appears and inserting in lieu thereof "$600".
(c) Section 428(c) of the Act is amended—
(1) in paragraph (2XD), by striking out "but shall not otherwise
provide for subrogation of the United States to rights of any
insurance beneficiary" and inserting in lieu thereof "but shall
provide for subrogation of the United States to the rights of any
insurance beneficiary only to the extent required for purposes of
paragraph (8)"; and
(2) by adding at the end thereof the following new paragraph:
PUBLIC LAW 97-35-AUG. 13,1981 95 STAT. 457
"(8) If the Secretary determines that the protection of the Federal
fiscal interest so requires, a State or nonprofit private institution or
organization with which the Secretary has an agreement under
subsection (b) shall assign to the Secretary any loan of which it is the
holder and for which the Secretary has made a payment pursuant to
paragraph (1) of this subsection.".
(dXD The matter following section 428(bXl)(MXviii) of the Act is 20 use 1078.
amended by striking out", and that no repayment of principal of any
loan for any period of study, training, service, or unemployment
described in this clause or any combination thereof shall begin until
six months after the completion of such period or combination
thereof.
(2) Section 427(aX2XC) of the Act is amended— 20 use 1077.
(A) by striking out "that any such period" and inserting in lieu
thereof "and that any such period"; and
(B) by striking out", and that no repayment of principal of any
loan for a period of study, training, service, or unemployment
described in this clause or any combination thereof shall begin
until six months after the completion of such period or combina-
tion thereof.
(eXD Section 427(aX2XB) of the Act is amended by striking out "not
earlier than".
(2) Section 428(b)(lXE) of the Act is amended by striking out "not
earlier than".
AMENDMENTS CONCERNING THE STUDENT LOAN MARKETING
ASSOCIATION
SEC. 538. (a) Section 439(a) of the Act is amended by striking out 20 use 1087-2.
"insured" wherever it appears, and by inserting after "student ^" ^°^ ^""^•
loans," the first time it appears the following: "including loans which
are insured".
(b) Section 439(a) of the Act is further amended by striking out
"and" at the end of clause (1), and by striking the period at the end of
clause (2) and inserting in lieu thereof the following: "; and (3) to
assure nationwide the establishment of adequate loan insurance
programs for students, to provide for an additional program of loan
insurance to be covered by agreements with the Secretary.".
(c) Section 439(d)(1) of the Act is amended to read as follows:
"(dXD The Association is authorized, subject to the provisions of
this section—
"(A) pursuant to commitments or otherwise to make advances
on the security of, purchase, or repurchase, service, sell or resell,
offer participations, or pooled interests or otherwise deal in, at
prices £ind on terms and conditions determined by the Associ-
ation, student loans which are insured by the Secretary under
this part or by a State or nonprofit private institution or
organization with which the Secretary has an agreement under
section 428(b);
"(B) to buy, sell, hold, underwrite, and otherwise deal in
obligations, if such obligations are issued, for the purpose of
making or purchasing insured loans, by a State or nonprofit
private institution or organization which has an agreement with
the Secretary under section 428(b) or by an eligible lender in a
State described in section 435(gXl) (D) or (F);
"(C) to undertake a program of loan insurance pursuant to
agreements with the Secretary under sections 428 and 428(A),
and except with respect to loans under section 439(o), the Secre-
95 STAT. 458 PUBLIC LAW 97-35—AUG. 13, 1981
tary may enter into an agreement with the Association for such
purpose only if the Secretary determines that (i) ehgible borrow-
ers are seelong and unable to obtain loans under this part, and
(ii) no State or nonprofit private institution or organization
having an agreement with the Secretary for a program of loan
insurance under this part is capable of or willing to provide a
program of loan insurance for such borrowers; and
"(D) to undertake any other activity which the Board of
Directors of the Association determines to be in furtherance of
the programs of insured student loans authorized under this part
or will otherwise support the credit needs of students.
The Association is further authorized to undertake any activity with
regard to student loans which are not insured or guaranteed as
provided for in this subsection as it may undertake with regard to
insured or guaranteed student loans. Any warehousing advance
made on the security of such loans shall be subject to the provisions of
paragraph (3) of this subsection to the same extent as a warehousing
advance made on the security of insured loans.".
20 u s e 1087-2. (d) Section 439(1) of the Act is amended by adding at the end thereof
the following: "The obligations of the Association shall be deemed to
be obligations of the United States for purposes of section 3701 of the
Revised Statutes (31 U.S.C. 742). For the purpose of the distribution of
its property pursuant to section 726 of title 11, United States Code»
the Association shall be deemed a person within the meaning of such
title.".
DIRECT STUDENT LOAN INTEREST RATE
20 u s e 1087dd. SEC. 539. Section 464(cXl)(D) of the Act is amended by striking out
"October 1,1980," and inserting in lieu thereof "Juty 1,1981, or 5 per
centum in the case of any loan made on or after October 1, 1981,".
EFFECTIVE DATES
20 u s e 1078 SEC. 540. (a) Except as provided in subsection (b), the amendments
note. made by this subtitle take effect on October 1,1981.
(bXD The amendments made by section 532 (other than subsection
(b)(4)) shall apply to loans for which the statement required by section
20 u s e 1078. 428(a)(2XA) of the Act is completed by the eligible institution on or
after October 1,1981.
(2) The amendments made by section 534(b) shall apply to loans
made on or after October 1,1981.
(3) The amendments made by section 536 shall take effect as
provided therein.
(4) The amendments made by section 538 shall take effect 30 days
after the date of enactment of this Act.
Consolidated Subtitle C—Refugee Education Consolidation
Refugee
Education
Assistance Act. SHORT TITLE
8 u s e 1522 note. SEC. 541. This subtitle may be cited as the "Consolidated Refugee
Education Assistance Act".
REPEALER
SEC. 542. The following provisions are hereby repealed:
(1) Section 4A of the Act of September 30, 1950 (Public Law
20 u s e 239a.
81-874).
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 459
(2) Titles I and 11 of the Indochina Refugee Children Assistance
Act of 1976. 20 u s e 1211b
(3) Section 317 of the Adult Education Act. note.
20 u s e 1211b.
AMENDMENTS 7 0 TITLE I OF THE REFUGEE EDUCATION ASSISTANCE ACT
OF 1980
SEC. 543. (aXD Section 101 of the Refugee Education Assistance Act
of 1980 is amended— 8 u s e 1522 note.
(A) by striking out paragraph (1) and by redesignating para-
graphs (2) and (3) as paragraphs (1) and (2), respectively;
(B) by inserting after paragraph (2) (as so redesignated) the
following new paragraph:
"(3) The term 'eligible participant' means any alien who— "Eligible
"(A) has been admitted into the United States as a refugee participant.'
under section 207 of the Immigration and Nationality Act; 8 u s e 1157.
"(B) has been paroled into the United States as a refugee
by the Attorney General pursuant to section 212(d)(5) of such
Act; 8 u s e 1182.
"(C) is an applicant for asylum, or has been granted
asylum, in the United States; or
"(D) has fled from the alien's country of origin and has,
pursuant to an Executive order of the President, been
permitted to enter the United States and remain in the
United States indefinitely for humanitarian reasons;
but only during the 36-month beginning with the first month in
which the alien entered the United States (in the case of an alien
described in (A), (B), or (D)) or the month in which the alien
applied for asylum (in the case of an alien described in subpara-
graph (C))."; and
(C) by striking out paragraph (4) and redesignating paragraph
(5) as paragraph (4).
(2) For purposes of the Refugee Education Assistance Act of 1980, 8 u s e 1522 note.
an alien who entered the United States on or after November 1,1979,
and is in the United States with the immigration status of a Cuban-
Haitian entrant (status pending) shall be considered to be an eligible
participant (within the meaning of section 101(3) of such Act), but
only during the 36-month period beginning with the first month in
which the alien entered the United States as such an entrant or
otherwise first acquired such status.
(b) Section 103(bXlXA) of the Refugee Education Assistance Act of 8 use 1522 note.
1980 is amended by striking out "aggregate of the amounts to which
all States are entitled" and inserting in lieu thereof "amount author-
ized to be appropriated".
(c) Section 104 of the Refugee Education Assistance Act of 1980 is 8 use 1522 note.
amended by striking out "1 percent of the amounts which that State
educational agency is entitled to receive for that period under this
Act" and inserting in lieu thereof "2 percent of the amount which
that State educational agency receives for that period under this
Act".
(d) Title I of the Refugee Education Assistance Act of 1980 is
amended by adding at the end thereof the following new section:
CONSULTATION WITH OTHER AGENCIES
"SEC. 106. To the extent that may be appropriate to facilitate the
determination of the amount of any reductions under sections
201(b)(2), 301(b)(3), and 401(b)(2), the Secretary shall consult with the 8 use 1522 note.
95 STAT. 460 PUBLIC LAW 97-35—AUG. 13, 1981
heads of other agencies providing assistance to eligible participants
in order to secure information concerning the disbursement of funds
for educational puiposes under programs administered by them and
provide, wherever feasible, for coordination among those programs
8 u s e 1522 note. and the programs under titles II through IV of this Act.".
AMENDMENTS TO TITLE II OF THE REFUGEE EDUCATION ASSISTANCE ACT
OF 1980
Grants to State SEC. 544. (a) Section 201 of the Refugee Education Assistance Act is
educational
agencies. amended—
8 u s e 1522 note. (1) by amending the first sentence of subsection (aXD to read as
follows: "The Secretary shall, in accordance with the provisions
of this title, make grants to State educational agencies for fiscal
year 1981, and for each subsequent fiscal year, for the purposes of
assisting local educational agencies of that State in providing
basic education for eligible participants enrolled in elementary
or secondary public schools. ;
(2) in the second sentence of subsection (aXD, by striking out
"Cuban and Haitian refugee children" and inserting in lieu
thereof "eligible participants'*:
(3) by amending subsection (bXD to read as follows:
Grant "Oi>Xl) As soon as possible after the date of the enactment of the
entitlement Consolidated Refugee Education Assistance Act, the Secretary shall
formula.
establish a formula (reflecting the availability of the full amount
authorized for this title under section 20303)) by which to determine
the amount of the grant which each State educational agency is
entitled to receive under this title for any fiscal year. The formula
established by the Secretary shall take into account the number of
years that an eligible participant assisted under this title has resided
within the United States and the relative costs, by grade level, of
providing education for elementary and secondaiy school children.
On the beisis of the formula the Secretaiy shall allocate among the
State educational agencies, for each fiscal vear, the amounts availa-
ble to carry out this title, subject to such reductions or adjustments as
may be required under paragraph (2) or subsection (c). Funds shall be
allocated among State educational agencies pursuant to the formula
without regard to variations in educational costs among different
geographical areas.";
(4) by amending the first sentence of subsection 03X2) to read as
follows: "The amount of the grant to which a State educational
agency is otherwise entitled for any fiscal year, as determined
under paragraph (1), shall be reduced by the amounts made
available for such fiscal vear under any other Federal law (other
than section 303 of the Elementary and Secondary Education Act
20 u s e 843. of 1965) for expenditure within the State for the same purposes
as those for which funds are made available under this title,
except that the reduction shall be made only to the extent that
(A) such amounts are made available for such purposes specifi-
cally because of the refugee, parolee, or asylee status of the
individuals to be served by such funds, and (B) such amounts are
made available to provide assistance to individuals eligible for
services under this title."; and
(5) in subsection (c), by striking out "Cuban and Haitian
refugee children" and inserting in lieu thereof "eligible
participants".
8 u s e 1522 note. 0>) Section 202(a) of the Refugee Education Assistance Act of 1980 is
amended—
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 461
(1) by amending paragraph (2) to read as follows:
"(2) provide assurances that such payments will be distributed
among local educational agencies within that State in accord-
ance with the formula established by the Secretary under section
201, subject to any reductions in payments for those local 8 use 1522 note.
educational agencies identified under paragraph (3) to which
funds described by section 201(bX2) are made available for the
same purposes under other Federal laws;";
(2) by redesignating paragraphs (3) and (4) as paragraphs (4)
and (5), respectively; and
(3) by inserting after paragraph (2) the following:
"(3) specify the amount of funds described by section 201(b)(2)
which are made available under other Federal laws for expendi-
ture within the State for the same purposes as those for which
funds are made available under this title and the local educa-
tional agencies to which such funds are made available;",
(c) Section 203 of the Refugee Education Assistance Act of 1980 is 8 use 1522 note.
amended—
(1) by amending the section heading to read as follows:
"PAYMENTS AND AUTHORIZATIONS";
(2) by inserting "(a)" after the section designation; and
(3) by adding at the end the following new subsection:
"(b) For fiscal year 1981 and for each subsequent fiscal year, there
is authorized to be appropriated, in the manner specified under
section 102, to make payments under this title an amount equal to the 8 use 1522 note.
product of—
"(1) the total number of eligible participants enrolled in
elementary or secondary public schools under the jurisdiction of
local educational agencies within all the States (other than the
jurisdictions to which section 103 is applicable) during the fiscal 8 use 1522 note.
year for which the determination is made,
multiplied by—
"(2) $400.".
AMENDMENTS TO TITLE III OF THE REFUGEE EDUCATION ASSISTANCE
ACT OF 1980
SEC. 545. (a) The heading of title III of the Refugee Education Grants to State
Assistance Act of 1980 is amended by striking out "REFUGEE". educational
agencies.
(b) Section 301 of the Refugee Education Assistance Act of 1980 is 8 u s e 1522 note.
amended—
(1) in subsection (a), by striking out "for each of the fiscal years
1981,1982, and 1983" and inserting in lieu thereof "for fiscal year
1981, and for each subsequent fiscal year,";
(2) by amending subsection (bXD to read as follows:
"(b)(1) Except as provided in paragraph (3) of this subsection and in
subsections (c) and (d) of this section, the amount of the grant to
which a State educational agency is entitled under this title for any
fiscal year shall be equal to the sum of—
"(A) the amount equal to the product of (i) the number of
eligible participants enrolled during the period for which the
determination is made in elementary or secondary public schools
under the jurisdiction of each local educational agency described
under paragraph (2) within that State, or in any elementary or
secondary nonpublic school within the district served by each
95 STAT. 462 PUBLIC LAW 97-35—AUG. 13, 1981
such local educational agency, who have been eligible partici-
pants less than one year, multiplied by (ii) $700;
"(B) the amount equal to the product of (i) the number of
eligible participants enrolled during the period for which the
determination is made in elementary or secondary public schools
under the jurisdiction of each local educational agency described
under paragraph (2) within that State, or in any elementary or
secondary nonpublic school within the district served by each
such local educational agency, who have been eligible partici-
pants at least one year but not more than two years, multiplied
by (ii) $500; and
"(C) the product of (i) the number of eligible participants
enrolled during the period for which the determination is made
in elementary or secondary public schools under the jurisdiction
of each local educational agency described under paragraph (2)
within that State, or in any elementary or secondary nonpublic
school within the district served by each such local educational
agency, who have been eligible participants more than two years
but not more than three years, multiplied by (ii) $300.";
(3) in subsection (bX2), by striking out "Cuban and Haitian
refugee children and Indocninese refugee children" and insert-
ing in lieu thereof "eligible participants ;
(4) in the first sentence of subsection (bX3), by striking out
"Cuban and Haitian refugee children and Indochinese refugee
children" and all that follows through the period and inserting in
lieu thereof "eligible participants, except that no reduction
under this paragraph shall be made for any funds made available
to the State under section 303 of the Elementary and Secondary
20 use 843. Education Act of 1965.";
(5) in subsection (bX5), by striking out "Cuban and Haitian
refugee children who meet the requirements of section 101(1)"
and inserting in lieu thereof "eligible participants who meet the
requirements of section 101(4)"; and
(6) in subsection (c), by striking out "Cuban and Haitian
refugee children and Indochinese refugee children" and insert-
ing in lieu thereof "eligible participants .
8 use 1522 note. (b) Section 302 of the Refugee Education Assistance Act of 1980 is
amended by striking out "Cuban and Haitian refugee children and
Indochinese refugee children" each place it appears and inserting in
lieu thereof "eligible participants".
8 use 1522 note. (c) Section 303(a) of the Refugee Education Assistance Act of 1980 is
amended—
(1) in paragraph (3), by inserting before the semicolon ", subject
to any reductions in payments for local educational agencies
identified under paragraph (5) to take into account the funds
8 use 1522 note. described by section 301(bX3) that are made available for educa-
tional, or education-related, services or activities for eligible
participants enrolled in elementary or secondary public schools
under the jurisdiction of such agencies or elementary or second-
ary nonpublic schools within the districts served by such
agencies; ;
(2) by redesignating paragraphs (5) and (6) as paragraphs (6)
and (7), respectively;
(3) by inserting after paragraph (4) the following:
"(5) specify (A) the amount of funds described by section
301(b)(3) that are made available under other Federal laws to
agencies or other entities for educational, or education-related,
services or activities within the State because of a significant
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 463
concentration of eligible participants, and (B) the local education-
al agencies within whose districts are eligible participants pro-
vided services from such funds who are enrolled in elementary or
secondary schools under the jurisdiction of such agencies, or in
elementary or secondary nonpublic schools served by such agen-
cies;"; and
(4) in paragraph (7), as so redesignated, by striking out "Cuban
and Haitian refugee children and Indochinese refugee children"
and inserting in lieu thereof "eligible participants".
AMENDMENTS TO TITLE IV OF THE REFUGEE EDUCATION ASSISTANCE
ACT OF 1980
SEC. 546. (a) Title IV of the Refugee Education Assistance Act of 8 use 1522 note.
1980 is amended by striking out "Cuban and Haitian refugee adults"
and "Haitian and Cuban refugee adults" each place such terms
appear and inserting in lieu thereof "eligible participants".
(b)(1) Section 401(a) of the Refugee Education Assistance Act of
1980 is amended by striking out "for each of the fiscal years 1982 and
1983" and inserting in lieu thereof "for fiscal year 1982, and for each
subsequent fiscal year".
(2) The first sentence of section 401(b)(2) of the Refugee Education 8 use 1522 note.
Assistance Act of 1980 is amended to read as follows: "The amount of
the grant to which a State educational agency is otherwise entitled
for any fiscal year, as determined under paragraph (1), shall be
reduced by the amounts made available for such fiscal year under
any other Federal law (other than section 303 of the Elementary and
Secondary Education Act of 1965) for expenditure within the State for 20 use 843.
the same purposes as those for which funds are made available under
this title, except that the reduction shall be made only to the extent
that (A) such amounts are made available for such purposes specifi-
cally because of the refugee, parolee, or asylee status of the individ-
uals to be served by such funds, and (B) such amounts are made
available to provide assistance to individuals eligible for services
under this title.".
(c) Section 403(a) of the Refugee Education Assistance Act of 1980 is 8 use 1522 note.
amended—
(1) by redesignating paragraphs (2) and (3) as paragraphs (3)
and (4), respectively; and
(2) by inserting after paragraph (1) the following:
"(2) specify the amount of reduction required under section
401(b)(2);".
EFFECTIVE DATE
SEC. 547. This subtitle shall take effect on October 1,1981. 8 u s e 1522 note.
Subtitle D—Elementary and Secondary Education Education
eonsolidation
Block Grant and
Improvement
Act of 1981.
SEC. 551. This subtitle may be cited as the "Education Consolida- 20 u s e 3801
tion and Improvement Act of 1981". note.
95 STAT. 464 PUBLIC LAW 97-35—AUG. 13, 1981
CHAPTER 1—FINANCIAL ASSISTANCE TO MEET SPECIAL
EDUCATIONAL NEEDS OF DISADVANTAGED CHILDREN
DECLARATION OF POLICY
20 use 3801. SEC. 552. The Congress declares it to be the policy of the United
States to continue to provide financial assistance to State and local
educational agencies to meet the special needs of educationally
deprived children, on the basis of entitlements calculated under title
20 use 2701. I of the Elementary and Secondary Education Act of 1965, but to do so
in a manner which will eliminate burdensome, unnecessary, and
unproductive paperwork and free the schools of unnecessary Federal
supervision, direction, and control. Further, the Congress recognizes
the special educational needs of children of low-income families, and
that concentrations of such children in local educationed agencies
adversely affect their ability to provide educational programs which
will meet the needs of such children. The Congress also finds that
Federal assistance for this purpose will be more effective if education
officials, principals, teachers, and supporting i)ersonnel are fi^eed
from overly prescriptive regulations and administrative burdens
which are not necessary for fiscal accountability and make no
contribution to the instructional program.
DURATION OP A S S I S T A N C E
20 use 3802. SEC. 553. During the period beginning October 1,1982, and ending
September 30, 1987, the Secretary shall, in accordance with the
provisions of this subtitle, make payments to State educational
agencies for grants made on the basis of enticements created under
title I of the Elementary and Secondary Education Act of 1965 and
calculated in accordance with provisions of that title in effect on
September 30,1982.
APPLICABILITY OP TITLE I PROVISIONS OP LAW
20 use 3803. SEC. 554. (a) PROGRAM ELIGIBILITY.—Except as otherwise provided
in this subtitle, the Secretary shall make payments based up<m^ the
amount of, and e^gibility for, grants as determined under the
following provisions of title I of the Elem^itary and Secoodary
Education Act in effect on September 30,1982:
20 use 2711. (1) Part A~"Programs Operated by Local Education
Afirencies' * t
(A) Subpart 1—"Basic Grants"; and
20 use 2721. (B) Subpart 2^"Special Grants".
20 use 2761. (2) Part B^"Programs Operated t^^ State Agwicies'V
(A> Subpart 1—"ProgramsforMigratory Children"j
20 use 2771. (B) Subpart 2^"Programs for Handicapped ChHAren";
20 use 2781. (Q Subpart 3—"Programs for Ne^ected and DeHnqaent
OffldterfWd
20 use 2791. (0) Subpart 4—"General Provisions for State Operated
Ptograms^.
Ob) AmstaistAAtPm PROVISIONS.—The Secretary, in making ^le
payments and determinations specified m subsection (a), [dftau con-
untie to usetihiefollowing provisions of title I of the Elementary and
Secondary Education Act as in effect on September 30,1982:
20 use 2841. (1) Part E—"Payments":
(A) Section 191—"Payment Metiwds";
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 465
(B) Section 192—"Amount of Payments to Local Educa- 20 use 2842.
tional Agencies";
(C) Section 193—"Adjustments Where Necessitated by 20 use 2843.
Appropriations"; and
(D) Section 194—"Payments for State Administration", 20 use 2844.
subject to subsection (d) of this section.
(2) Part F—"General Provisions": 20 use 2851.
(A) Section 197—"Limitation on Grants to Puerto Rico"; 20 use 2853.
and
(B) Section 198—"Definitions" and conforming amend- 20 use 2854.
ments to other Acts, except that only those definitions
applicable to this subtitle shall be used.
(c) APPUCABILITY RULE.—The provisions of title I of the Elementary
and Secondary Education Act of 1965 which are not specifically made 20 use 2701.
applicable by this chapter shall not be applicable to programs
authorized under this chapter.
(d) AMENDMENT.—Section 194(aXl) of the Elementary and Second- 20 use 2844.
ary Education Act of 1965 is amended by striking out "1.5 per
centmn" and inserting in lieu thereof "1 per centum".
AUTHORIZED PROGRAMS
SEC. 555. (a) GENERAL.—Each State and local educational agency 20 use 3804.
shall use the payments imder this chapter for programs and projects
(including the acquisition of equipment and, where necessary, the
construction of school facilities) which are designed to meet the
special educational needs of educationally deprivedchildren.
(b) PROGRAM DESIGN.—State agency programs shall be designed to
serve those categories of children counted for eligibility for grants
under section 554(aX2) in accordance with the requirements of this
chapter.
(c) PROGRAM DESCRIPTION.—^A local education agency may use
funds received under this chapter only for programs and projects
which are designed to meet the special educational needs of educa-
tionally deprived children identified in accordance with section
556(bX2), Eind which are included in an application for assistance
approved by the State educational agency. Such programs and
projects may include the acquisition of equipment and instructional
materials, employment of special instructional and counseling and
guidance personnel, employment and training of teacher aides,
payments to teachers of amounts in excess of regular salary sched-
ules as a bonus for service in schools serving project areas, the
training of teachers, the construction, where necessary, of school
facilities, other expenditures authorized under title I of the Elemen-
tary and Secondary Education Act as in effect September 30,1982,
and planning for such programs and projects.
(d) RECORDS AND INFORMATION.—Each State educational agency
shall keep such records and provide such information to the Secre-
tary as may be required for fiscal audit and program evaluation
(consistent with the responsibilities of the Secretary under this
chapter).
APPROVAL OP APPLICATIONS
SEC. 556. (a) APPLICATION BY LOCAL EDUCATIONAL AGENCY.—A local 20 use 3805.
educational agency may receive a grant under this chapter for any
fiscal year if it has on file with me State educational agency an
application wMch describes the programs and projects to be con-
ducted with such assistance for a period of not more than three years,
95 STAT. 466 PUBLIC LAW 97-35—AUG. 13, 1981
and such application has been approved by the State educational
agency.
0)) APPLICATION ASSURANCES.—The application described in subsec-
tion (a) shall be approved if it provides assurances satisfactory to the
State educational agency that the local educational agency Will keep
such records and provide such information to the State educationsu
agency as may be required for fiscal audit and program evaluation
(consistent with the responsibilities of the State agency under this
chapter), and that the programs and projects described—
dXA) are conducted in attendance areas of such agency having
the highest concentrations of low-income children;
(B) are located in all attendance areas of an agency which has a
uniformly high concentration of such children; or
(C) are designed to utilize part of the available funds for
services which promise to provide significant help for all such
children served by such agency;
(2) are based upon an annual assessment of educational needs
which identifies educationally deprived children in all ehgible
attendance areas, permits selection of those children who have
the greatest need for special assistance, and determines the
needs of participating children with sufficient specificity to
ensure concentration on those needs;
(8) are of sufficient size, scope, and quality to give reasonable
promise of substantial progress toward meeting the s ^ i a l
educational needs of the children being served suid are designed
and implemented in consultation with parents and teachers of
such children;
(4) will be evaluated in terms of their effectiveness in achieving
the goals set for them, and that such evaluations shall include
objective measurements of educational achievement in basic
skills and a determination of whether improved performance is
sustained over a period of more than one year; and
(5) make provision for services to educationally deprived chil-
dren attending private elementary and secondary schools in
accordance with section 557.
PARTICIPATION OF CHILDREN ENROLLED IN PRIVATE SCHOOLS
20 use 3806. SEC 557. (a) GENERAL REQUIREMENTS.—To the extent consistent
with the number of educationally deprived children in the school
district of the local educational agency who are enrolled in private
elementary and secondary schools, such agency shall make provi-
sions for including special educational services and arrangements
(such as dual enrollment, educational radio and television, and
mobile educational services and equipment) in which such children
can participate and which meet the requirements of sections 555(c),
556(b) (2), (3), and (4), and 558(b). Expenditures for educational
services and arrangements pursuant to this section for educationally
deprived children in private schools shall be equal (taking into
account the number of children to be served and the special educa-
tional needs of such children) to expenditures for children enrolled in
the public schools of the local educational agency.
(b) BYPASS PROVISION.—(1) If a local educational agency is prohibit-
ed by law from providing for the participation in specisd programs for
educationally deprived children enrolled in private elementary and
secondary schools as required by subsection (a), the Secretary shall
waive such requirements, and shall arrange for the provision of
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 467
services to such children through arrangements which shall be
subject to the requirements of subsection (a).
(2) If the Secretary determines that a local educational agency has
substantially failed to provide for the participation on an equitable
basis of educationally deprived children enrolled in private elemen-
tary and secondary schools as required by subsection (a), he shall
arrange for the provision of services to such children through
arrangements which shall be subject to the requirements of subsec-
tion (a), upon which determination the provisions of subsection (a)
shall be waived.
(3)(A) When the Secretary arranges for services pursuant to this
subsection, he shall, after consultation with the appropriate public
and private school officials, pay to the provider the cost of such
services, including the administrative cost of arranging for such
services, from the appropriate allocation or allocations under this
chapter.
(B) Pending final resolution of any investigation or complaint that
could result in a determination under this subsection, the Secretary
may withhold from the allocation of the affected State or local
educational agency the amount he estimates would be necessary to
pay the cost of such services.
(C) Any determination by the Secretary under this section shall
continue in effect until the Secretary determines that there will no
longer be any failure or inability on the part of the local educational
agency to meet the requirements of subsection (a).
(4)(A) The Secretary shall not take any final action under this
subsection until the State educational agency and local educational
agency affected by such action have had an opportunity, for at least
forty-five days after receiving written notice thereof, to submit
written objections and to appear before the Secretary or his designee
to show cause why such action should not be taken.
(B) If a State or local educational agency is dissatisfied with the
Secretary's final action after a proceeding under subparagraph (A) of
this paragraph, it may within sixty days after notice of such action,
file with the United States court of appeals for the circuit in which
such State is located a petition for review of that action. A copy of the
petition shall be forthwith transmitted by the clerk of the court to the
Secretary. The Secretary thereupon shall file in the court the record
of the proceedings on which he based his action, as provided in section
2112 of title 28, United States Code.
(C) The findings of fact by the Secretary, if supported by substantial
evidence, shall be conclusive; but the court, for good cause shown,
may remand the case to the Secretary to take further evidence, and
the Secretary may thereupon make new or modified findings of fact
and may modify his previous action, and shall file in the court the
record of the further proceedings. Such new or modified findings of
fact shall likewise be conclusive if supported by substantial evidence.
(D) Upon the filing of a petition under subparagraph (B), the court
shall have jurisdiction to affirm the action of the Secretary or to set it
aside, in whole or in part. The judgment of the court shall be subject
to review by the Supreme Court of the United States upon certiorari
or certification as provided in section 1254 of title 28, United States
Code.
(c) Any bypass determination by the Secretary under title I of the
Elementary and Secondary Education Act of 1965 prior to the 20 use 2701.
effective date of this chapter shall remain in effect to the extent
consistent with the purposes of this chapter.
95 STAT. 468 PUBLIC LAW 97-35—AUG. 13, 1981
GENERAL PROVISIONS
20 use 3807. SEC. 558. (a) MAINTENANCE OP EPFORT.—(1) Except as provided in
paragraph (2), a local educational agency may receive funds under
this chapter for any fiscal year only if the State educationsJ agency
finds that either the combined fiscal effort per student or the
aggregate expenditures of that agency and the State with respect to
the provision of free public education by that agency for the preced-
ing fiscal year was not less than 90 per centum of such combined
fiscal effort or aggregate expenditures for the second preceding fiscal
year.
(2) The State educational agency shall reduce the amount of the
allocation of funds under this chapter in any fiscal year in the exact
proportion to which a local educational agency fails to meet the
requirement of paragraph (1) by falling below 90 per centum of both
the combined fiscal effort per student and aggregate expenditures
(using the measure most favorable to such local agency), and no such
lesser amount shall be used for computing the enort required under
paragraph (1) for subsequent years.
Waiver of (3) The State educational agencry may waive, for one fiscal year
requirements. only, the requirements of this subsection if the State educational
agency determines that such a waiver would be equitable due to
exceptional or uncontrollable circumstances such as a natural disas-
ter or a precipitous and unforeseen decline in the financial resources
of the local educational agency.
(b) FEDERAL FUNDS TO SUPPLEMENT, NOT SUPPLANT REGULAR NON-
FEDERAL FUNDS.—A local educational agency may use funds received
under this chapter only so as to supplement and, to the extent
practical, increase the level of funds that would, in the absence of
such Federal funds, be made available from non-Federal sources for
the education of pupils participating in programs and projects
assisted under this chapter, and in no case may such funds be so used
as to supplant such funds from such non-Federal sources. In order to
demonstrate compliance with this subsection a local education agen-
cy shall not be required to provide services under this chapter
outside the regular classroom or school program.
(c) CoMPARABiuTY OP SERVICES.—(1) A local oducational agency
may receive funds under this chapter only if State and local fun<b
will be used in the district of such agency to provide services in
project areeis which, taken as a whole, are at least comparable to
services being provided in areas in such district whicn are not
receiving funds under this chapter. Where all school attendance
areeis in the district of the agency are designated as project areas, the
agency may receive such funds only if State and local funds are used
to provide services which, taken as a whole, are substantially compa-
rable in each project area.
(2) A local educational agency shall be deemed to have met the
requirements of pargigraph (1) if it has filed with the State educa-
tional agency a written assurance that it has established—
(A) a districtwide salsiry schedule;
(B) a policy to ensure equivalence among schools in teachers,
administrators, and auxiliary personnel; and
(C) a policy to ensure equivalence among schools in the
provision of curriculum materials and instructional supplies.
Unpredictable changes in student enrollment or personnel assign-
ments which occur after the beginning of a school year shall not be
included as a factor in determining comparability of services.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 469
(d) EXCLUSION OP SPECIAL STATE AND LOCAL PROGRAM FUNDS.—For
the purposes of determining compliance with the requirements of
subsections (b) and (c), a locm educational agency may exclude State
and local funds expended for carrying out special programs to meet
the educational needs of educationmly deprived children, if such
programs are consistent with the purposes of this chapter.
(e) ALLOCATION OF FUNDS IN CERTAIN STATES.—In any State in
which a large number of local educational ^encies overlap county
boundaries, the State educational agency is authorized to make
allocations of basic grants and special incentive grants directly to
local educational agencies without regard to counties, if such alloca-
tions were made during fiscal year 1982, except that (1) precisely the
same factors are used to determine the amount of such grants to
counties, and (2) a local educational agency dissatisfied with such
determination is afforded an opportunity for a hearing on the matter
by the State educational agency.
CHAPTER 2—CONSOLIDATION OF FEDERAL PROGRAMS FOR
ELEMENTARY AND SECONDARY EDUCATION
STATEMENT OF PURPOSE
SEC. 561. (a) It is the purpose of this chapter to consolidate the 20 use 38ii.
program authorizations contained in—
(1) titles II, m , IV, V, VI, Vm, and IX (except part C) of the
Elementary and Secondary Education Act of 1965; 20 use 2881
(2) the Alcohol and Drug Abuse Education Act; 2941,3081,3i4i,
(3) part A and section 532 of title V of the Higher Education 334}' '^'^^' ^^^^'
Act of 1965; 21 use 1001
(4) the Follow Through Act (on a phased basis); note^
(5) section 3(a)(1) of the National Science Foundation Act of 20 use 1101,
1950 relating to precoUege science teacher training; and Post% 568
(6) the Career Education Incentive Act; 42 u ^ 1862.
into a single authorization of grants to States for the same purposes 20 use 2601
set forth in the provisions of law specified in this sentence, but to be note.
used in accordance with the educational needs and priorities of State
and local educational agencies as determined by such agencies. It is
the further purpose and intent of Congress to financially assist State
and local educational agencies to improve elementary and secondary
education (including preschool education) for children attendiag both
public and private schools, and to do so in a manner designed to
greatly reduce the enormous administrative and paperwork burden
imposed on schools at the expense of their ability to educate children,
(b) The basic responsibility for the administration of funds made
available under this chapter is in the State educational agencies, but
it is the intent of Congress that this responsibility be carried out with
a minimum of paperwork and that the responsibility for the design
and implementation of programs assisted under the chapter shall be
mainly that of local educational agencies, school superintendents and
principals, and classroom teachers and supporting personnel, because
they have the most direct contact with students and are most directly
responsible to parents.
AUTHORIZATION OF APPROPRIATIONS; DURATION OF ASSISTANCE
SEC. 562. (a) There are authorized to be appropriated such sums as 20 use 3812.
may be necessary for fiscal year 1982 and each of the five succeeding
fiscal years to carry out the provisions of this chapter.
95 STAT. 470 PUBLIC LAW 97-35—AUG. 13, 1981
(b) During the period beginning July 1,1982, and ending September
30,1987, the Secretary shall, in accordance with the provisions of this
subtitle, make payments to State educational agencies for the pur-
poses of this chapter.
(c) Funds available under previously authorized programs shall be
available for the purpose of such pa:pients in accordance with section
^nte, p. 445. 514(bX2) of the Omnibus Education Reconciliation Act of 1981.
ALLOTMENTS TO STATES
20 use 3813. SEC. 563. (a) From the sxmis appropriated to carry out this chapter
in any fiscal year, the Secretary shall reserve not to exceed 1 per
centum for payments to Guam, American Samoa, the Virgin Islands,
the Trust Territory of the Pacific Islands, and the Northern Mariana
Islands, to be allotted in accordance with their respective needs. The
Secretary shall reserve an additional amount, not to exceed 6 per
centum of the sums appropriated, to carry out the purposes of section
583. From the remednder of such sums the Secretary shall allot to
each State an £unount which bears the same ratio to the amount of
such remainder as the school-age population of the State bears to the
school-age population of all States, except that no State shall receive
less than an amount equal to 0.5 per centum of such remainder,
(b) For the purposes of this section:
"School-age (1) The term "school-age population" means the population
population.' 3gg(jflygthrough seventeen.
"States." (2) The term "States" includes the fifty States, the District of
Columbia, and Puerto Rico.
STATE APPUCATIONS
20 use 3814. SEC. 564. (a) Any State which desires to receive grants under this
chapter shall file an application with the Secretary which—
(1) designates the State educational agency as the State agency
responsible for the administration and supervision of programs
assisted under this chapter;
(2) provides for a process of active and continuing consultation
with the State educational agency of an advisory committee,
appointed by the Governor and determined by the Governor to be
broadly representative of the educational interests and the
gener^ public in the State, including persons representative of—
(A) public and private elementary and secondary school-
children;
(B) classroom teachers;
(C) parents of elementary and secondary schoolchildren;
(D) local boards of education;
(E) local and regional school administrators (including
principals and superintendents); ,
(F) institutions of higher education; and
(G) the State legislature;
to advise the State educational agency on the allocation among
authorized functions of funds (not to exceed 20 per centum of the
amount of the State's £dlotment) reserved for State use under
section 565(a), on the formula for the allocation of funds to local
educational agencies, and on the planning, development, sup-
port, implementation, and evaluation of State programs assisted
under this chapter;
(3) sets forth the planned allocation of funds reserved for State
Post, pp. 472,473, use Under section 565(a) among subchapters A, B, and C of this
475.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 471
chapter and among the authorized programs and projects which
are to be implemented, and the allocation of such mnds required
to implement section 586, including administrative costs of
carrying out the responsibilities of the State educational agency
under this chapter;
(4) provides for timel^r public notice and public dissemination
of the information provided pursuant to paragraphs (2) and (3);
(5) beginning with fiscal year 1984, provides for an annual
evaluation of the efiTectiveness of programs assisted under this
chapter, which shall include comments of the advisory commit-
tee, and shall be made available to the public; and
(6) provides that the State educational agency will keep such Recordkeeping.
records and provide such information to the Secretary as may be
required for fiscal audit and program evaluation (consistent with
the responsibilities of the Secretary under this chapter); and
(7) contains assurances that there is compUance with the
specific requirements of this chapter.
(b) An application filed by the State under subsection (a) shall be for
a period not to exceed three fbscal years, and may be amended
annually as may be necessary to reflect changes without filing a new
application.
ALLOCATION TO LOCAL EDUCATIONAL AGENCIES
SEC. 565. (a) From the sum made available each year under section 20 use 3815.
563, the State educational agency shall distribute not less than 80 per
centum to local educational agencies within such State according to
the relative enrollments in public and nonpublic schools within the
school districts of such agencies, ai^usted, in accordance with criteria
approved by the Secretary, to provide higher per pupil allocations to
local educational agencies which have the greatest numbers or
percentages of children whose education imposes a higher than
average cost per child, such as—
(1) children from low-income families,
(2) children living in economically depressed urbeui and rural
areas, and
(3) children living in sparsely populated areas.
(b) The Secretary shall approve criteria suggested by the State
educational agency for adjusting allocations under subsection (a) if
such criteria are reasonably calculated to produce an equitable
distribution of funds with reference to the factors set forth in
subsection (a).
(c) From the funds paid to it pursuant to sections 563 and 564
during each fiscal year,-the State educational agency shall distribute
to each local educational agency which has submitted an application
as required in section 566 the amount of its allocation as determined
under subsection (a).
LOCAL APPLICATIONS
SEC. 566. (a) A local educational agency may receive its allocation of 20 use 3816.
funds under this chapter for any year in which it has on file with the
State educational agency an application which—
(1) sets forth the planned allocation of funds among sub-
chapters A, B, and C of this chapter and for the programs i'ost, pp. 472,473,
authorized by such subchapters which it intends to support, ^'^^•
including the allocation of such funds required to implement
section 586;
-194 0—82 32:QL3
95 STAT. 472 PUBLIC LAW 97-35—AUG. 13, 1981
(2) provides assurances of compliance with provisions of this
chapter relating to such programs, including the participation of
children enrolled in private, nonprofit schools in accordance with
section 586;
Recordkeeping. (3) agrees to keep such records, and provide such information
to the State educational agency as reasonably may be required
for fiscal audit and program evaluation, consistent with the
responsibilities of the State agency under this chapter; and
(4) in the allocation of funds for programs authorized by this
chapter, and in the design, planning, and implementation of such
programs, provides for systematic consultation with parents of
children attending elementary and secondary schools in the area
served by the local agency, with teachers and administrative
personnel in such schools, and with other groups as may be
deemed appropriate by the local educational agency.
(b) An application filed by a local educational agency under
subsection (a) shall be for a period not to exceed three fiscal years,
may provide for the allocation of funds among programs and pur-
poses authorized by this chapter for a period of three years, and may
be amended annually as may be necessary to reflect changes without
filing a new application.
(c) Each local educational agency shall have complete discretion,
subject only to the provisions of this chapter, in determining how
funds the agency receives under this section shall be divided among
the purposes oi this chapter in accordance with the application
submitted under this section.
Subchapter A—Basic Skills Development
USE OF FUNDS
20 use 3821. SEC. 571. Funds allocated for use under this subchapter shall be
used by State and local educational agencies to develop and imple-
ment a comprehensive and coordinated program designed to improve
elementary and secondary school instruction in the basic skills of
reading, mathematics, and written and oral communication, as
formerly authorized by title II of the Elementary and Secondary
20 use 2881. Education Act of 1965, relating to basic skills improvement, including
the special mathematics program as formerly authorized by section
20 use 2912. 232 of such title.
STATE LEADERSHIP AND SUPPORT SERVICES
Grants and SEC. 572. (a) In order to achieve the purposes of this subchapter,
contracts. State educational agencies may use funds reserved for State pro-
20 u s e 3822.
grams to make grants to and enter into contracts with local educa-
tional agencies, institutions of higher education, and other public and
private agencies, organizations, and institutions—
(1) to carry out planning, research and development, demon-
stration projects, training of leadership personnel, short term
and regular session teacher training institutes; and
(2) for the development of instructional materials, the dissemi-
nation of information, and technical assistance to local educa-
tional agencies.
Each State educational agency may also use such funds for technical
assistance and training for State boards of education.
(b) State educational agencies may support activities designed to
enlist the assistance of parents and volunteers working with schools
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 473
to imi)rove the performance of children in the basic skills. Such
activities may include—
(1) the development and dissemination of materials that par-
ents may use in the home to improve their children's perform-
ance in those skills; and
(2) voluntary training activities for parents to encourage and
assist them to help their children in developing basic skills;
except that such activities conducted in local areas shall be conducted
with the approval of and in conjunction with programs of local
educational agencies.
SCHOOL LEVEL PROGRAMS
SEC. 573. (a) In planning for the utilization of funds it allocates for 20 use 3823.
this chapter (from its allotment under section 565) a local educational
agency shall provide for the participation of children enrolled in
private elementary and secondary schools (and of teachers in such
schools) in accordance with section 586. Such plans shall be developed
in conjunction with and involve continuing consultation with teach-
ers and principals in such district. Such planning shall include a
systematic strategy for improving basic skills instruction for all
children which provides for planning and implementation at the
school building level, involving teachers, administrators, and (to the
extent practicable) parents, and utilizing all available resources in a
comprehensive program. The programs shall include—
(1) diagnostic assessment to identify the needs of all children in
the school;
(2) the establishment of learning goals and objectives for
children and for the school;
(3) to the extent practicable, pre-service and in-service training
and development programs for teachers, administrators, teacher
aides and other support personnel, designed to improve instruc-
tion in the basic skills;
(4) activities designed to enlist the support and participation of
parents to aid in the instruction of their children; and
(5) procedures for testing students and for evaluation of the
effectiveness of programs for maintaining a continuity of effort
for individual children.
(b) The programs described in subsection (a) may include such
areawide or districtwide activities as learning centers accessible to
students and parents, demonstration and training programs for
parents, and other activities designed to promote more effective
instruction in the basic skills.
Subchapter B—Educational Improvement and Support Services
STATEMENT OF PURPOSE
SEC. 576. It is the purpose of this subchapter to permit State and 20 use 3831.
local educational agencies to use Federal funds (directly, and through
grants to or contracts with educational agencies, local educational
agencies, institutions of higher education, and other public and
private agencies, organizations, and institutions) to carry out selected
activities from among the full range of programs and projects
formerly authorized under title IV, relating to educational improve- 20 USC 3081.
ment, resources, and support, title V, relating to State leadership, 20 use 3141.
title VI, relating to emergency school aid, of the Elementary and 20 use 3i9i.
Secondary Education Act of 1965, section 3(a)(1) of the National
95 STAT. 474 PUBLIC LAW 97-35—AUG. 13, 1981
42 use 1862. Science Foundation Act of 1950, relating to precoUege science teacher
training, and part A and section 532 of title V of the Higher
20 use 1101, Education Act of 1965, relating to the Teacher Corps and teacher
^^^^^ centers, in accordance with the planned allocation of funds set forth
in the applications under sections 564 and 566, in conformity with the
other requirements of this chapter.
AUTHORIZED ACTIVITIES
20 use 3832. SEC. 577. Programs and projects authorized under this subchapter
include—
(1) the acquisition and utilization—
(A) of school library resources, textbooks, and other
printed and published instructional materials for the use of
children and teachers in public and private elementary and
secondary schools which shall be used for instructional
purposes only, and
(B) of instructional equipment and materials suitable for
use in providing education in academic subjects for use by
children and teachers in elementary and secondary schools
which shall be used for instructional purposes only,
which take into account the needs of children in both public and
private schools based upon periodic consultation with teachers,
librarians, media specialists, and private school officials;
(2) the development of programs designed to improve local
educational practices in elementary and secondary schools, and
particularly activities desired to address educational problems
such as the education of cmldren with special needs (education-
ally deprived children, gifted and talented children, including
children in private schools);
(3) programs designed to assist local educational agencies, upon
their request, to more effectively address educational problems
caused by the isolation or concentration of minority group
children m certain schools if such assistance is not conditioned
upon any requirement that a local educational agency which
assigns students to schools on the basis of geogpraphic attendance
areas adopt any other method of student assignment, and that
such assistance is not made available for the transportation of
students or teachers or for the acquisition of equipment for such
transportation;
(4) comprehensive guidance, counseling, and testing programs
in elementary and secondary schools and State and local support
services necessary for the effective implementation and evmua-
tion of such programs (including those designed to help prepare
students for employment);
(5) programs and projects to improve the planning, manaj^e-
ment and implementation of educational programs, including
fiscal management, by both State and local educational agencies,
and the cooperation of such agencies with other public agencies;
(6) programs and projects to assist in teacher training and in-
service staff development, particularly to better prepare both
new and in-service ^rsonnel to deal with contempNorary teaching
and learning requirements and to provide assistance in the
teaching and learning of educationally deprived students; and
(7) programs and projects to assist local educational agencies to
meet the needs of children in schools imdergoing desegregation
and to assist such agencies to develop and implement plans for
desegregation in the schools of such agencies.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 475
Subchapter C—Special Projects
STATEMENT OF PURPOSE
SEC. 581. It is the purpose of this subchapter to permit State and 20 use 3841.
local educational agencies to use Federal funds (directly and through
grants to or contracts with educational agencies, local educational
agencies, institutions of higher education, and other public and
private g^encies, organizations, and institutions) to carry out selected
activities from among the full range of programs and projects
formerly authorized under title III, relating to special projects, title
VIII, relating to community schools, and title IX (except part C),
relating to gifted and talented children, educational proficiency
standards, safe schools program, and ethnic heritage program, of the
Elementary and Secondary Education Act of 1965, the Career Educa- 20 use 2941,
tion Incentive Act, and part B of title V of the Economic Opportunity |o^us? 2601
Act of 1964, relating to Follow Through programs, in accordance with ^o^g
the planned allocation of funds set forth in the applications under 42 use 2929.
sections 564 and 566, in conformity with the other requirements of
this chapter.
AUTHORIZED ACTIVITIES
SEC. 582. Programs and projects authorized under this subchapter 20 use 3842.
include—
(1) special projects (as may be determined to be desirable by the
State or local educational agencies) in such areas as—
(A) preparation of students to use metric weights and
measurements when such use is needed;
(B) emphasis on the arts as an integral part of the
curriculum;
(C)(i) in-school partnership programs in which the parents
of school-age children participate to enhance the education
and personal development of the children, previously au-
thorized by part B of the Headstart-FoUow Through Act; 42 use 2929.
(ii) preschool partnership programs in which the schools
work with parents of preschool children in cooperation with
programs funded under the Headstart-FoUow Through Act; 42 use 2921.
(D) consumer education;
(E) preparation for employment, the relationship between
basic academic skill development and work experience, and
coordination with youth employment programs carried out
under the Comprehensive Employment and Training Act;
(F) career education previously authorized by the Career
Education Incentive Act;
(G) environmental education, health education, education
about legal institutions and the American system of law and
its underlying principles, and studies on population and the
effects of population changes;
(H) academic and vocational education of juvenile delin-
quents, youth offenders, and adult criminal offenders; and
(I) programs to introduce disadvantaged secondary school
students to the possibilities of careers in the biomedical and
medical sciences, and to encourage, motivate, and assist
them in the pursuit of such careers;
(2) the use of public education facilities as community centers
operated by a local education agency in conjunction with other
local governmental agencies and community organizations and
groups to provide educational, recreational, health care, cul-
95 STAT. 476 PUBLIC LAW 97-35—AUG. 13, 1981
tural, and other related community and human services for the
community served in accordance with the needs, interests, and
concerns of the community and the agreement and conditions of
the governing board of the local educational agency; and
(3) additional programs, including—
(A) special programs to identify, encourage, and meet the
special educational needs of children who give evidence of
high performance capability in areas such as intellectual,
creative, artistic, leadership capacity, or specific academic
fields, and who require services or activities not ordi-
narily provided by the school in order to fully develop such
capabilities;
(B) establishment of educational proficienQr standards for
reading, writing, mathematics, or other subjects, the admin-
istration of examinations to measure the proficiency of
students, and implementation of programs (coordinated with
Ante, p. 472. those Under subchapter A of this chapter) designed to assist
students in achieving levels of proficiency compatible with
established standards;
(C) programs designed to promote safety in the schools and
to reduce the incidence of crime and vanaalism in the school
environment;
(D) planning, developing, and implementing ethnic heri-
tage studies programs to provide all persons with an
oi>portunity to learn about and appreciate the unique con-
tributions to the American national heritage made by the
various ethnic groups, and to enable students better to
understand their own cultural heritage as well as the
cultural heritage of others; and
(E) programs involving training and advisory services
42 use 2000c. under title IV of the Civil Rights Act of 1964.
Subchapter D—Secretary's Discretionary Funds
DISCRETIONARY PROGRAM AUTHORIZED
20 use 3851. SEC. 583. (a) From the sums reserved by the Secretary pursuant to
the second sentence of section 563(a) the Secretary is authorized to
cany out directly or throujgh grants to or contracts with State and
local educational agencies, institutions of higher education, and other
public and private agencies, organizations, and institutions, pro-
grams and projects which—
(1) provide a national source for gathering and disseminating
information on the efTectiveness of programs designed to meet
the special educational needs of educationally deprived children,
and others served by this subtitle, and for assessing the needs of
such individuals, including programs and projects formerly au-
thorized by section 376 of the Elementary and Secondary Educa-
20 use 3041. tion Act of 1965 and programs and projects formerly funded
under the "National Dimision Network" program;
(2) carry out research and demonstrations related to the
purposes of this subtitle;
(3) are designed to improve the training of teachers and other
instructional personnel needed to carry out the purposes of this
subtitle; or
(4) are designed to assist State and local educational agencies
in the implementation of programs under this subtitle.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 477
(b) From the funds reserved for the purposes of this section, the
Secretary shall first fund—
(1) the Inexpensive Book Distribution Program (as carried out
through "Reading is Fundamental") as formerly authorized by
part C of title II of the Elementary and Secondary Education Act
of 1965, 20 u s e 2911.
(2) the programs of national significance in the "Arts in
Education Program as formerly authorized by part C of title III
ofsuchAct, and
(3) programs in alcohol and drug abuse education as formerly
authorized by the Alcohol and Drug Abuse Education Act, 21 u s e 1001
at least in amounts necessary to sustain the activities described in note.
this sentence at the level of operations during fiscal year 1981, and
then utilize the remainder of such funds for the other authorized
activities described in subsection (a).
Subchapter E—General Provisions
MAINTENANCE OF EFFORT; FEDERAL FUNDS SUPPLEMENTARY
SEC. 585. (a)(1) Except as provided in paragraph (2), a State is 20 use 3861.
entitled to receive its full allocation of funds under this chapter for
any fiscal year if the Secretary finds that either the combined fiscal
effort per student or the aggregate expenditures within the State
with respect to the provision of free public education for the preced-
ing fiscal year was not less than 90 per centum of such combined
fiscal effort or aggregate expenditures for the second preceding fiscal
year.
(2) The Secretary shall reduce the amount of the allocation of funds
under this chapter in any fiscal year in the exact proportion to which
the State fails to meet the requirements of paragraph (1) by falling
below 90 per centum of both the fiscal effort per student and
aggregate expenditures (using the measure most favorable to the
State), and no such lesser amount shall be used for computing the
effort required under paragraph (1) for subsequent years.
(3) The Secretary may waive, for one fiscal year only, the require- Waiver of
ments of this subsection if he determines that such a waiver would be requirements.
equitable due to exceptional or uncontrollable circumstances such as
a natural disaster or a precipitous and unforeseen decline in the
financial resources of the State.
(b) A State or local educational agency may use and allocate funds
received under this chapter only so as to supplement and, to the
extent practical, increase the level of funds that would, in the absence
of Federal funds made available under this chapter, be made availa-
ble from non-Federal sources, and in no case may such funds be used
so as to supplant funds from non-Federal sources.
(c) The Secretary is specifically authorized to issue regulations to Regulations.
enforce the provisions of this section.
PARTICIPATION OF CHILDREN ENROLLED IN PRIVATE SCHOOLS
SEC. 586. (a)(1) To the extent consistent with the number of children 20 use 3862.
in the school district of a local educational agency which is eligible to
receive funds under this chapter or which serves the area in which a
program or project assisted under this chapter is located who are
enrolled in private nonprofit elementary and secondary schools, or
with respect to instructional or personnel training programs funded
by the State educational agency from funds reserved for State use
95 STAT. 478 PUBLIC LAW 97-35—AUG. 13, 1981
under section 565, such agency after consultation with appropriate
private school officials, shall provide for the benefit of such children
in such schools secular, neutral, and nonideological services, materi-
als, and equipment including the participation of the teachers of such
children (and other educational personnel serving such children) in
training programs, and the repair, minor remodeling, or construction
of public facilities as may be necessary for their provision (consistent
with subsection (c) of this section), or, if such service, materials, and
equipment are not feasible or necessary in one or more such private
schools as determined by the local educational agency after consulta-
tion with the appropriate private school officials, shall provide such
other arrangements as will assure equitable participation of such
children in the purposes and benefits of this chapter.
Contract (2) If no program or project is carried out under subsection (a)(1) of
authority. t;his section in the school district of a local educational agency, the
State educational agency shall make arrangements, such as through
contracts with nonprofit agencies or organizations, under which
children in private schools in that district are provided with services
and materials to the extent that would have occurred if the local
educational agency had received funds under this chapter.
(3) The requirements of this section relating to the participation of
children, teachers, and other personnel serving such children shall
apply to programs and projects carried out under this chapter by a
State or local educational agency, whether directly or through grants
to or contracts with other public or private agencies, institutions, or
organizations.
(b) Expenditures for programs pursuant to subsection (a) shall be
equal (consistent with the number of children to be served) to
expenditures for programs under this chapter for children enrolled in
the public schools of the local educational agency, taking into account
the needs of the individual children and other factors which relate to
such expenditures, and when funds available to a local educational
agency under this chapter are used to concentrate programs or
projects on a particular group, attendance area, or grade or age level,
children enrolled in private schools who are included within the
group, attendance area, or grade or age level selected for such
concentration shall, after consultation with the appropriate private
school officials, be assured equitable participation in the purposes
and benefits of such programs or projects.
(c)(1) The control of funds provided under this chapter and title to
materials, equipment, and property repaired, remodeled, or con-
structed therewith shall be in a public agency for the uses and
purposes provided in this chapter, and a public agency shall adminis-
ter such funds and property.
(2) The provision of services pursuant to this section shall be
provided by employees of a public agency or through contract by such
public agency with a person, an association, agency, or corporation
who or which, in the provision of such services, is independent of such
private school and of any religious organizations, and such employ-
ment or contract shall be under the control and supervision of such
public agency, and the funds provided under this chapter shall not be
commingled with State or local funds.
Waiver of (d) If by reason of any provision of law a State or local educational
requirements. agency is prohibited from providing for the participation in programs
of children enrolled in private elementary and secondary schools, as
required by this section, the Secretary shall waive such requirements
and shall arrange for the provision of services to such children
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 479
through arrangements which shall be subject to the requirements of
this section.
(eXD If the Secretary determines that a State or a local educational Waiver of
agency has substantially failed or is unwilling to provide for the requirements.
participation on an equitable basis of children enrolled in private
elementary and secondary schools as required by this section, he may
waive such requiremente and shall arrange for the provision of
services to such children through arrangements which shall be
subject to the requirements of thte section.
(2) Pending final resolution of any investigation or complaint that
could result in a determination under this subsection or subsection
(d), the Secretary may withhold from the allocation of the affected
State or local educational agency the amount he estimated would be
necessary to pay the cost of those services.
(f) Any determination by the Secretary under this section shall
continue in effect until the Secretary determines that there will no
longer be any failure or inability on the part of the State or local
educational agency to meet the requirements of subsections (a) and
(b).
(g) When the Secretary arranges for services pursuant to this
section, he shall, after consultation with the appropriate public and
private school officials, pay the cost of such services, including the
administrative costs of arranging for those services, from the appro-
priate allotment of the State under this chapter.
(h)(1) The Secretary shall not take any final action under this
section until the State educational agency and the local educational
agency affected by such action have had an opportunity, for at least
forty-five days after receiving written notice thereof, to submit
written objections and to appear before the Secretary or his designee
to show cause why that action should not be taken.
(2) If a State or local educational agency is dissatisfied with the
Secretary's final action after a proceeding under paragraph (1) of this
subsection, it may within sixty days after notice of such action, file
with the United States court of appeals for the circuit in which such
State is located a petition for review of that action. A copy of the
petition shall be forthwith transmitted by the clerk of the court to the
Secretary. The Secretary thereupon shall file in the court the record
of the proceedings on which he based this action, as provided in
section 2112 of title 28, United States Code.
(3) The findings of fact by the Secretary, if supported by substantial
evidence, shall be conclusive; but the court, for good cause shown,
may remand the case to the Secretary to take further evidence and
the Secretary may thereupon make new or modified findings of fact
and may modify his previous action, and shall file in the court the
record of the further proceedings. Such new or modified findings of
fact shall likewise be conclusive if supported by substantial evidence.
(4) Upon the filing of such petition, the court shall have jurisdiction
to affirm the action of the Secretary or to set it aside, in whole or in
part. The judgment of the court shall be subject to review by the
Supreme Court of the United States upon certiorari or certification as
provided in section 1254 of title 28, United States Code.
(i) Any bypass determination by the Secretary under titles II
through VI and VIII and IX of the Elementary and Secondary
Education Act of 1965 prior to the effective date of this chapter shall 20 USC 2881,
remain in effect to the extent consistent with the purposes of this ^^^^' ^^81, 33ii.
chapter.
95 STAT. 480 PUBLIC LAW 97-35—AUG. 13, 1981
REPEALS
20 u s e 3863. SEC. 587. (a) Effective October 1,1982, the provisions of—
(1) titles II, III, IV, V, VI, VIII, and IX (except part C) of the
20 u s e 2881, Elementary and Secondary Education Act of 1965;
2941, 3081, 3141, (2) part A and section 532 of title V of the Higher Education
3191, 3281, 3311,
3341. Act of 1965;
20 u s e 1101, (3) the Alcohol and Drug Abuse Education Act; and
1119a. (4) the Career Education Incentive Act;
21 u s e 1001 are repealed.
note.
20 u s e 2601 (b) Effective October 1,1984, subchapter C of chapter 8 of subtitle A
note. of title VI of this Act, relating to Follow-Through programs is
Post, p. 508. repealed.
CHAPTER 3—GENERAL PROVISIONS
FEDERAL REGULATIONS
20 use 3871. SEC. 591. (a) The Secretary is authorized to issue regulations—
(1) relating to the discharge of duties specifically assigned to
the Secretary under this subtitle;
(2) relating to proper fiscal accounting for funds appropriated
under this subtitle and the method of making payments author-
ized under this subtitle; and
(3) which are deemed necessary to reasonably insure that there
is compliance with the specific requirements and assurances
required by this subtitle.
Qo) In all other matters relating to the details of planning, develop-
ing, implementing, and evaluating programs and projects by State
and local educational agencies the Secretanr shall not issue regula-
tions, but may consult with appropriate State, local, and private
educational agencies and, upon request, provide technical assistance,
information, and suggested guidelines designed to promote the devel-
opment and implementation of effective instructional programs and
to otherwise assist in canying out the purposes of this subtitle.
(c) Regulations issued pursuant to this subtitle shall not have the
standing of a Federal statute for the purposes of judicial review.
WITHHOLDING OF PAYMENTS
20 use 3872. SEC. 592. (a) Whenever the Secretary after reasonable notice to any
State educational agency and an opportunity for a hearing on the
record, finds that there has been a failure to comply substantially
with any assurances required to be given or conditions required to be
met under this subtitle the Secretary shall notify such agency of
these findings and that beginning sixty days after the date of such
notification, further payments will not be made to the State under
this subtitle, or affected chapter thereof (or, in his discretion, that the
State educational agency shall reduce or terminate further payments
under the subtitle or affected chapter thereof, to specified local
educational agencies or State agencies affected by the failure) until
he is satisfied that there is no longer any such failure to comply. Until
he is so satisfied, (1) no further payments shall be made to the State
under the subtitle or affected chapter thereof, or (2) payments by the
State educational agency under the subtitle or affected chapter
thereof shall be limited to local educational agencies and State
agencies not affected by the failure, or (3) payments to particular
local educational agencies shall be reduced, as the case may be.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 481
(b) Upon submission to a State of a notice under subsection (a) that
the Secretary is withholding pa3mients, the Secretary shall take such
action as may be necessary to bring his action to the attention of the
public within the State.
JUDICIAL REVIEW
SEC. 593. (a) If any State is dissatisfied with the Secretary's action 20 use 3873.
under section 592(a), such State may, within sixty days after notice of
such action, file with the United States court of appeals for the circuit
in which such State is located a petition for review of that action. A
copy of the petition shall be forthwith transmitted by the clerk of the
court to the Secretary. The filing of such petition shall act to suspend
any withholding of funds by the Secretary pending the judgment of
the court and prior to a final action on any review of such judgment.
The Secretary thereupon shall file in the court the record of the
proceedings on which he based his action, as provided in section 2112
of title 28, United States Code.
(b) A State educational agency shall be presumed to have complied
with this subtitle, but the findings of fact by the Secretary, if
supported by the weight of evidence, may overcome such presump-
tion. The court may remand the case to the Secretary to take further
evidence, and the Secretary may thereupon make new or modified
findings of fact and may modify his previous action, and shall file in
the court the record of the further proceedings.
(c) Upon the filing of such petition, the court shall have jurisdiction
to affirm the action of the Secretary or to set it aside, in whole or in
part. The judgment of the court shall be subject to review by the
Supreme Court of the United States upon certiorari or certification as
provided in section 1254 of title 28, United States Code.
AVAILABILITY OF APPROPRIATIONS
SEC. 594. Notwithstanding any other provision of law, unless 20 use 3874.
expressly in limitation of this section, funds appropriated in any
fiscal year to carry out activities under this subtitle shall become
available for obligation on July 1 of such fiscal year and shall remain
available for obligation until the end of the succeeding fiscal year.
DEFINITIONS
SEC. 595. (a) Except as otherwise provided herein as used in this 20 use 3875.
subtitle—
(1) the term "State" means a State, Puerto Rico, Guam, the
District of Columbia, American Samoa, the Virgin Islands, the
Northern Mariana Islands, or the Trust Territory of the Pacific
Islands;
(2) the term "Secretary" means the Secretary of Education;
(3) the term "State educational agency" means the officer or
agency primarily responsible for the State supervision of public
elementary and secondary schools;
(4) the term "local educational agency" means a public board
of education or other public authority legally constituted within
a State for either administrative control or direction of, or to
perform a service function for, public elementary or secondary
schools in a city, county, township, school district, or other
political subdivision of a State, or such combination of school
districts or counties as are recognized in a State as an adminis-
trative agency for its public elementary or secondary schools.
Such term includes any other public institution or agency having
95 STAT. 482 PUBLIC LAW 97-35—AUG. 13, 1981
administrative control and direction of a public elementary or
secondary school;
(5) the term "parent" includes a legal guardian or other person
standing in loco parentis;
(6) the term "free public education" means education which is
provided at public expense, under public supervision and direc-
tion, and without tuition charge, and which is provided as
elementary or secondary school education in the applicable
State, except that such term does not include any education
provided beyond grade twelve;
(7) the term "elementary school" means a day or residential
school which provides elementary education, as determined
under State law, and the term "secondary school" means a day or
residential school which provides secondary education, as deter-
mined under State law, except that it does not include any
education provided beyond grade twelve;
(8) the term "construction" includes the preparation of draw-
ings and specifications for school faciUties; erecting, building,
acquiring, altering, remodeling, improving, or e x t e n ^ g school
facilities; and the inspection and supervision of the construction
of school facilities;
(9) the term "equipment" includes machinery, utilities, and
building equipment and any necessary enclosure or structures to
house them, and includes all other items necessary for the
functioning of a particular facility as a faciUty for the provision
of educational services, including items such as instructional
equipment and necessary furniture, printed, published, and
audio-visual instructional materials, and books, periodicals, doc-
uments, and other related materials; and
(10) the term "school facilities" means classrooms and related
faciUties (including initial equipment) for free public education
and interests in land (includmg site, grading, and improvements)
on which such facilities are constructed, except that such term
does not include those gymnasiums and similar facilities
intended primarily for exhibitions for which admission is to be
charged to the general public.
(b) Any term used in provisions referenced by section 554 and not
defined in this section shall have the same meaning as that term was
given in title I of the Elementary and Secondary Education Act of
20 use 2701. 1965 in effect prior to October 1,1981.
APPUCATION OF OTHER LAWS
20 use 3876. SEC. 596. (a) Sections 434, 435, and 436 of the General Education
20 use 1232c, Provisions Act (relating to "State Educational Agency Monitoring
I232d, I232e. ^j^^ Agency Application") shall not apply to programs authorized
under this subtitle except to the extent that they relate to fiscal
control and fund accounting procedures (including the title to prop-
erty acquired with Federal funds), and shall not be construed to
authorize the Secretary to require any reports or take £iny actions not
specifically authorized by this subtitle.
20 use 1225. (b) Section 412 of the General Education Provisions Act shall apply
to any funds appropriated for £iny fiscal year pursuant to this
subtitle.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 483
TITLE VI—HUMAN SERVICES PROGRAMS
Subtitle A—Authorizations Savings for Fiscal Years
1982,1983, and 1984
CHAPTER 1—GENERAL PROVISIONS
EFFECT ON OTHER LAWS
SEC. 601. (a) Any provision of law which is not consistent with the 42 u s e 9801
provisions of this subtitle hereby is superseded and shall have only note.
such force and effect during each of the fiscal years 1982, 1983, and
1984 which is consistent with this subtitle.
(b) Notwithstanding any authorization of appropriations for fiscal
year 1982, 1983, or 1984 contained in any provision of law which is
specified in this subtitle, no funds are authorized to be appropriated
in excess of the limitations imposed upon appropriations by the
provisions of this subtitle.
CHAPTER 2—EDUCATION OF THE HANDICAPPED
PROGRAMS
EDUCATION OF THE HANDICAPPED ACT
SEC. 602. (a)(1) There is authorized to be appropriated to carry out
part B of the Education of the Handicapped Act, other than sections 20 u s e 1411
618 and 619, $969,850,000 for fiscal year 1982, and $1,017,900,000 for note.
each of thefiscalyears 1983 and 1984. 20 u s e 1418,
1419.
(2) There is authorized to be appropriated to carry out section 618 of 20 u s e 1418
such Act $2,300,000 for each of the fiscal years 1982 and 1983. note.
(3) There is authorized to be appropriated to carry out section 619 of 20 u s e 1419
such Act $25,000,000 for each of the fiscal years 1982 and 1983. note.
(b)(1) There is authorized to be appropriated to carry out section 621
of the Education of the Handicapped Act (relating to regional 20 u s e 1421
resource centers) $9,800,000 for each of the fiscal years 1982 and 1983. note.
(2) There is authorized to be appropriated to carry out section 622 of
such Act $16,000,000 for each of the fiscal years 1982 and 1983. 20 u s e 1422
note.
(3) There is authorized to be appropriated to carry out section 623 of
such Act $20,000,000 for each of the fiscal years 1982 and 1983. 20 u s e 1423
note.
(4) There is authorized to be appropriated to carry out sections 621
and 624 of such Act (relating to projects for severely handicapped 20 u s e 1421
children) $5,000,000 for each of the fiscal years 1982 and 1983. note.
(5) There is authorized to be appropriated to carry out section 625 of
such Act $4,000,000 for each of the fiscal years 1982 and 1983. 20 u s e 1424a
note.
(6) There is authorized to be appropriated to carry out sections 631,
632, and 634 of such Act $58,000,000 for each of the fiscal years 1982 20 u s e 1431
note.
and 1983.
(7) There is authorized to be appropriated to carry out section 633 of
such Act $1,000,000 for each of the fiscal years 1982 and 1983. 20 u s e 1433
note.
(8) There is authorized to be appropriated to carry out part E of
such Act $20,000,000 for each of the fiscal years 1982 and 1983. 20 u s e 1444
note.
(9) There is authorized to be appropriated to carry out part F of
such Act $19,000,000 for each of the fiscal years 1982 and 1983. 20 u s e 1454
note.
95 STAT. 484 PUBLIC LAW 97-35—AUG. 13, 1981
CHAPTER 8—VOCATIONAL REHABILITATION PROGRAMS
GENERAL AUTHORIZATION UNDER REHABIUTATION ACT OF 1973
SEC. 603. There is authorized to be appropriated to carry out the
29 use 701 note. Rehabilitation Act of 1973 $1,009,260,000 for fiscal year 1982, and
$1,054,160,000 for fiscal year 1983.
SPECIFIC SPENDING LIMITS UNDER REHABILITATION ACT OF 1973
29 use 701 note. SEC. 604. (a) Of the amounts authorized to be appropriated in
section 603, not to exceed $250,000 shall be available, for each of the
fiscal years 1982 and 1983, to carry out section 12 of the Rehabilita-
29 use 711. tion Act of 1973.
(b) Notwithstanding the authorization of appropriations made in
section 603, no funds are authorized to be appropriated to carry out
29 use 713. section 14 of the Rehabilitation Act of 1973 for fiscal year 1982 or
1983.
(c) Of the amounts authorized to be appropriated in section 603,
such sums as may be necessary shall be available, for each of the
fiscal years 1982 and 1983, to carry out section 15 of the Rehabilita-
29 use 714. tion Act of 1973.
(d) Of the amounts authorized to be appropriated in section 603, not
to exceed $899,000,000 for fiscal year 1982, and not to exceed
$943,900,000 for fiscal year 1983, shall be available for the purpose of
making grants to States pursuant to State entitlements under part B
29 use 730. of title I of the Rehabilitation Act of 1973.
(e) Notwithstanding the authorization of appropriations made in
section 603, no funds are authorized to be appropriated to carry out
29 use 740. section 120(a) of the Rehabilitation Act of 1973 for fiscal year 1982 or
1983.
(f) Of the amounts authorized to be appropriated in section 603, not
to exceed $650,000 shall be available, for each of the fiscal years 1982
and 1983, for the purpose of making grants to Indian tribes under
29 use 750. part D of title I of the Rehabilitation Act of 1973.
(g)(1) Of the amounts authorized to be appropriated in section 603,
not to exceed $3,500,000 shall be available, for each of the fiscal years
1982 and 1983, to carry out section 112 of the Rehabilitation Act of
29 use 732. 1973.
(2) The requirement for the setting aside of funds established in the
first sentence of section 112(a) of such Act shall not have any force or
effect for each of the fiscal years 1982 and 1983.
(h) Of the amounts authorized to be appropriated in section 603, not
to exceed $35,000,000 shall be available, for each of the fiscal years
29 use 760. 1982 and 1983, to carry out title II of the Rehabilitation Act of 1973.
(i) Notwithstanding the authorization of appropriations made in
section 603, no funds are authorized to be appropriated to carry out
29 use 771. section 301 of the Rehabilitation Act of 1973 for fiscal year 1982 or
1983.
(j) Notwithstanding the authorization of appropriations made in
section 603, no funds are authorized to be appropriated to carry out
29 use 772. section 302 of the Rehabilitation Act of 1973 for fiscal year 1982 or
1983.
(k) Of the amounts authorized to be appropriated in section 603, not
to exceed $25,500,000 shall be available, for each of the fiscal vears
1982 and 1983, to carry out section 304 of the Rehabilitation Act of
29 use 774. 1973.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 485
(1) Notwithstanding the authorization of appro|)riations made in
section 603, no funds are authorized to be appropriated to carry out
section 305 of the Rehabilitation Act of 1973 for fiscal year 1982 or 29 use 775.
1983.
(mXD Of the amounts authorized to be appropriated in section 603,
not to exceed $12,210,000 shall be available, for each of the fiscal
years 1982 and 1983, to carry out sections 310,311,312,314, and 315 of
the Rehabilitation Act of 1973. 29 use 777,
(2) The requirement for the setting aside of funds established in the JJ Ja, 777b, 777d,
first sentence of section 310(b) of such Act shall not have any force or ""^®
effect for each of the fiscal years 1982 and 1983.
(n) Of the amounts authorized to be appropriated in section 603, not
to exceed $2,000,000 shall be available, for each of the fiscal years
1982 and 1983, to carry out section 316 of the Rehabilitation Act of
1973. 29 use 777f.
(o) Of the amounts authorized to be appropriated in section 603, not
to exceed $3,500,000 shall be available, for each of the fiscal years
1982 and 1983, to carry out section 313 of the Rehabilitation Act of
1973. 29 use 777c.
(p) Of the amounts authorized to be appropriated in section 603, not
to exceed $256,000 shall be available, for each of the fiscal years 1982
and 1983, to carry out title IV of the Rehabilitation Act of 1973. 29 use 780.
(q) Of the amounts authorized to be appropriated in section 603,
such sums as may be necessary shall be available, for each of the
fiscal years 1982 and 1983, to carry out section 502 of the Rehabilita-
tion Act of 1973. 29 use 792.
(r) Notwithstanding the authorization of appropriations made in
section 603, no funds are authorized to be appropriated to carry out
section 506 of the Rehabilitation Act of 1973 for fiscal year 1982 or 29 use 794b.
1983.
(s) Notwithstanding the authorization of appropriations made in
section 603, no funds are authorized to be appropriated to carry out
part A of title VI of the Rehabilitation Act of 1973 for fiscal year 1982 29 use 795.
or 1983.
(t) Of the amounts authorized to be appropriated in section 603, not
to exceed $8,000,000 shall be available, for each of the fiscal years
1982 and 1983, to carry out part B of title VI of the Rehabilitation Act
of 1973. 29USe795g.
(u) Notwithstanding the authorization of appropriations made in
section 603, no funds are authorized to be appropriated to carry out
part A, C, or D of title VII of the Rehabilitation Act of 1973 for fiscal 29 use 796,796f,
year 1982 or 1983. "^^^g.
(v) Of the amounts authorized to be appropriated in section 603, not
to exceed $19,400,000 shall be available, for each of the fiscal years
1982 and 1983, to carry out part B of title VII of the Rehabilitation
Act of 1973. 29USe796e.
CHAPTER 4—OTHER HANDICAPPED PROGRAMS AND
SERVICES
AMERICAN PRINTING HOUSE FOR THE BUND; GALLAUDET COLLEGE;
KENDALL SCHOOL; MODEL SECONDARY SCHOOL FOR THE DEAF; NA-
TIONAL TECHNICAL INSTITUTE FOR THE DEAF ACT
SEC. 605. (a) The total amount of appropriations to carry out the Act
of March 3, 1979 (20 Stat. 468), relating to the American Printing 20 use lOi note.
House for the Blind, shall not exceed $5,000,000 for each of the fiscal
years 1982,1983, and 1984.
95 STAT. 486 PUBLIC LAW 97-35—AUG. 13, 1981
(b) The total amount of appropriations to carry out the Act of June
18,1954 (68 Stat. 265), relating to Gallaudet College, shall not exceed
$52,000,000 for each of the fiscal years 1982,1983, and 1984. Amounts
appropriated pursuant to this subsection also shall be available for
the administration of the Kendall Demonstration Elementary School
and the Model Secondary School for the Deaf.
(c) The total amount of appropriations to carry out the National
20 u s e 681 note. Technical Institute for the Deaf Act shall not exceed $26,300,000 for
each of the fiscal years 1982,1983, and 1984.
CHAPTER 5—OLDER AMERICAN PROGRAMS
OLDER AMERICANS ACT OF 1965
SEC. 606. (a) There is authorized to be appropriated to carry out the
42 u s e 3001 Older Americans Act of 1965 (other than title V of such Act)
note. $715,000,000 for fiscal year 1982 and $793,312,000 for fiscal year 1983.
42 u s e 3056.
42 u s e 3056f (b)(1) There is authorized to be appropriated to carry out title V of
note. the Older Americans Act of 1965—
(A) $277,100,000 for fiscal year 1982 and $293,726,000 for fiscal
year 1983; and
(B) such additional sums as may be necessary for each such
fiscal year to enable the Secretary of Labor, through the oper-
ation of older American community service emplojnnent pro-
grams under such title, to provide for at least 54,200 part-time
employment positions for eligible individuals.
(2) For purposes of this subsection:
"Eligible (A) The term "eligible individual" has the meaning given it in
individual."
42 u s e 3056e. section 507(2) of the Older Americans Act of 1965.
"Part-time (B) The term "part-time emplojnment position" means an
employment employment position with a workweek of at least 20 hours.
position. (c) Section 213 of the Older Americans Act of 1965 is amended by
42 u s e 3020c.
striking out ", where such organization demonstrates clear superior-
ity with respect to the quality of services covered by such contract".
CHAPTER 6-DOMESTIC VOLUNTEER SERVICE PROGRAMS
AUTHORIZATIONS UNDER DOMESTIC VOLUNTEER SERVICE ACT OF 1973
SEC. 607. (a) Section 501 of the Domestic Volunteer Service Act of
42 u s e 5081. 1973 is amended to read as follows:
NATIONAL V O L U N T E E R A N T I P O V E R T Y PROGRAMS
"SEC. 501. There is authorized to be appropriated to carry out title I
42 use 4951. of this Act $25,763,000 for fiscal year 1982 and $15,391,000 for fiscal
year 1983. Of the amounts appropriated under this section, not less
than $16,000,000 shall first be available for carrying out part A of
title I for fiscal year 1982, and not less than $8,000,000 shall first be
available for carrying out part A of title I for fiscal year 1983.".
42 use 5082. (bXD Section 502(a) of the Domestic Volunteer Service Act of 1973 is
amended to read as follows:
"SEC. 502. (a) There is authorized to be appropriated $28,691,000 for
fiscal year 1982 and $30,412,000 for fiscal year 1983, for the purpose of
carrying out programs under part A of title II of this Act.".
(2) Section 502(b) of such Act is amended to read as follows:
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 487
"(b) There is authorized to be appropriated $49,670,000 for fiscal
year 1982 and $52,650,000 for fiscal year 1983, for the purpose of
carrying out programs under part B of title II of this Act.". ^2 use son.
(3) Section 502 of such Act is amended by adding at the end thereof 42 use 5082.
the following new subsection:
"(c) There is authorized to be appropriated $16,610,000 for fiscal
year 1982 and $17,607,000 for fiscal year 1983, for the purpose of
carrying out part C of title II of this Act.". 42 use 5021.
(c) Section 504 of the Domestic Volunteer Service Act of 1973 is 42 use 5084.
amended to read as follows:
"ADMINISTRATION AND COORDINATION
"SEC. 504. There is authorized to be appropriated for the adminis-
tration of this Act, as authorized in title IV of this Act, $30,091,000 for 42 use 504i.
fiscal year 1982 and $29,348,000 for fiscal year 1983.".
AMENDMENTS TO DOMESTIC VOLUNTEER SERVICE ACT OF 1973
SEC. 608; (a) Section 114(a) of the Domestic Volunteer Service Act of Grants and
1973 is amended to read as foUows: 4^^*4974
"SEC. 114. (a) The Director is authorized to make grants and
contracts for projects and programs which encourage and enable
students in secondaiy, secondary vocational, and post-secondary
schools to participate in service-learning programs on an in-school or
out-of-school basis in assignments of a character and on such terms
and conditions as are described in subsections (a) and (c) of section
103.".
(b) Section 211 of the Domestic Volunteer Service Act of 1973 is 42 use 5011.
amended—
(1) by striking out subsection (b); and
(2) by redesignating subsections (c), (d), (e), and (f) as subsec-
tions (b), (c), (d), and (e), respectively.
(c) Title II of the Domestic Volunteer Service Act of 1973 is
amended—
(1) by redesignating part C as part D; and
(2) by inserting after section 212 the following new part:
"PART C—SENIOR Ck)MPANiONS PROGRAM
"GRANTS AND CONTRACTS FOR THE PROGRAM
"SEC. 213. (a) The Director is authorized to make grants to or 42 use 5013.
contracts with public and nonprofit private agencies and organiza-
tions to pay part or all of the cost of development and operation of
projects (including direct payments to individuals serving under this
part in the same manner as provided in section 211(a)) designed for
the purpose of providing opportunities for low-income persons aged
60 or over to serve as 'senior companions' to persons with exceptional
needs. Senior companions may provide services designed to help older
persons requiring long-term care, including services to persons re-
ceiving home health care, nursing care, home-delivered meals or
other nutrition services; services designed to help persons deinstitu-
tionalized from mental hospitals, nursing homes, and other institu-
tions; and services designed to assist persons having developmental
disabilities and other special needs for companionship.
89-194 0—82 33 : QL3
95 STAT. 488 PUBLIC LAW 97-35—AUG. 13, 1981
42 use 5011. "(b) The provisions of section 211(d) and section 211(e) and such
other provisions of part B as the Director determines to be necessary
shall apply to the provisions of this part.".
(d) The heading of part B of the Domestic Volunteer Service Act of
1973 is amended to read as follows:
"PART B—FOSTER GRANDPARENT PROGRAM".
(eXD The item relating to part B of title II in the table of contents of
the Domestic Volunteer Service Act of 1973 is amended to read as
follows:
"PART B—FOSTER GRANDPARENT PROGRAM".
(2) The table of contents of such Act is amended by inserting after
the item relating to part B the following new items:
"PART C—SENIOR (COMPANIONS PROGRAM
"Sec. 213. Grants and contracts for the program.".
(3) The item relating to part C of title 11 in the table of contents of
such Act is amended by striking out "PART C " and inserting in lieu
thereof "PART D".
42 use 4973. (f)(1) Section 113(cX2) of the Domestic Volunteer Service Act of 1973
is amended by striking out "Secretary of Health, Education, and
Welfare" and inserting in lieu thereof "Secretary of Health and
Human Services".
42 use 5021. (2) Section 221 of such Act is amended—
(A) by striking out "the Community Services Administration,";
and
(B) by striking out "Health, Education, and Welfare" and
inserting in lieu thereof "Health and Human Services".
42 use 5057. (3) Section 417(cX2) of such Act is amended by striking out "Secre-
tary of Health, Education, and Welfare or the Secretary of Health
and Human Resources, as the case may be," and inserting in lieu
thereof "Secretary of Health and Human Services".
CHAPTER 7—CHILD ABUSE PREVENTION AND TREATMENT
PROGRAMS
STATE GRANTS UNDER CHILD ABUSE PREVENTION AND TREATMENT ACT
42 use 5103 SEC. 609. There is authorized to be appropriated to make grants to
^0^ States under section 4(bXl) of the Child Abuse Prevention and
42 use 5103. Treatment Act $7,000,000 for each of the fiscal years 1982 and 1983.
DISCRETIONARY PROGRAMS
42 use 5107. SEC. 610. (aXD The Secretary of Health and Human Services, either
directly, through grants to States and public and private, nonprofit
organizations and agencies, or through jointly financed cooperative
arrangements with States, public agencies, and other agencies and
organizations, is authorized to provide for activities of nationed
significance related to child abuse prevention and treatment and
adoption reform, including operation of a national center to collect
and disseminate information regarding child abuse and neglect, and
operation of a national adoption information exchange system to
facilitate the adoptive placement of children.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 489
(2) The Secretary, in carrying out the provisions of this subsection,
shall provide for the continued operation of the National Center on
Child Abuse and Neglect in accordance with section 2(a) of the Child
Abuse Prevention and Treatment Act for each of the fiscal years 1982 42 use 5ioi.
and 1983.
(3) If the Secretary determines, in fiscal year 1982 or 1983, to carry
out any of the activities described in section 2(b) of the Child Abuse
Prevention and Treatment Act, the Secretary shall carry out such
activities through the National Center on Child Abuse and Neglect.
(b) There is authorized to be appropriated to cariy out this section Appropriation
$12,000,000 for each of the fiscal years 1982 and 1983. Of the amounts authorization.
appropriated under this subsection for any fiscal year, not less than
$2,000,000 shall be available to carry out title II of the Child Abuse
Prevention and Treatment and Adoption Reform Act of 1978. 42 use 5iii.
CHAPTER 8—COMMUNITY SERVICES PROGRAMS
Subchapter A—Community Economic Development Community
Economic
Development
SHORT TITLE Act of 1981.
SEC, 611. This subchapter may be cited as the "Community Eco- 42 u s e 9801
nomic Development Act of 1981". note.
STATEMENT OP PURPOSE
SEC. 612. The purpose of this subchapter is to encourage the 42 u s e 9801.
development of special programs by which the residents of urban and
rural low-income areas may, through self-help and mobilization of
the community at large, with appropriate Federal assistance,
improve the quality of their economic and social participation in
community life in such a way as to contribute to the elimination of
poverty and the establishment of permanent economic and social
benefits.
DEFINITION
SEC. 613. For purposes of this subchapter, the term "community 42TJSC 9802.
development corporation" means a nonprofit organization responsi-
ble to residents of the area it serves which is receiving financial
assistance under part 1 and any organization more than 50 percent of Post, p. 490.
which is owned by such an organization, or otherwise controlled by
such an organization, or designated by such an organization for the
purpose of this subchapter.
SOURCE OF FUNDS
SEC. 614. The Secretary is authorized to use funds made available to 42 Use 9803.
the Secretary under section 681(b) for purposes of carr5dng out the Post, p. 518.
provisions of this subchapter.
ADVISORY COMMUNITY INVESTMENT BOARDS
SEC. 615. (aXD The President is authorized to establish a National Establishment.
Advisory Community Investment Board (hereinafter in this section 42 u s e 9804:
referred to as the "Investment Board"). Such Investment Board shall
be composed of 15 members appointed, for staggered terms and
without regard to the civil service laws, by the President, in consulta-
tion with the Secretary of Health and Human Services (hereinafter in
95 STAT. 490 PUBLIC LAW 97-35—AUG. 13, 1981
this subchapter referred to as the "Secretary"). Such members shall
be representative of the investment and business communities and
appropriate fields of endeavor related to this subchapter. The Invest-
ment Board shall meet at the call of the chairperson, but not less
often than 3 times each year. The Secretary and the administrator of
community economic development programs shall be ex officio mem-
bers of the Investment Board.
(2) The Secretary shall carry out the provisions of this subchapter
through the Office of Community Services established in section
676(a).
(b) The Investment Board shall promote cooperation between
private investors and businesses and community development corpo-
ration projects through—
(1) advising the Secretary and the community development
corporations on ways to facilitate private investment;
(2) advising businesses and other investors of opportunities in
community development corporation projects; and
(3) advising the Secretary, community development corpora-
tions, and private investors and businesses of ways in which they
might engage in mutually beneficial efforts.
(c) The governing body of each Community Development Corpora-
tion may establish an advisory community investment board com-
posed of not to exceed 15 members who shall be appointed by the
governing body after consultation with appropriate local officials.
Each such board shall promote cooperation between private investors
and businesses and the governing body of the Community Develop-
ment Corporation through—
(1) advising the governing body on ways to facilitate private
investors;
(2) advising businesses and other investors of opportunities in
Community Development Corporation projects; and
(3) advising the governing body, private investors, and busi-
nesses of ways in which they might engage in mutually beneficial
efforts.
PART 1—URBAN AND RURAL SPECL^L IMPACT PROGRAMS
STATEMENT OF PURPOSE
42 use 9805. SEC. 616. The purpose of this part is to establish special programs of
assistance to nonprofit private locally initiated community develop-
ment corporations which (1) are directed to the solution of the critical
problems existing in particular communities or neighborhoods (de-
fined without regard to political or other subdivisions or boundaries)
within those urban and rural areas having concentrations or substan-
tial numbers of low-income persons; (2) are of sufficient size, scope,
and duration to have an appreciable impact in such communities,
neighborhoods, and rural areas in arresting tendencies toward
dependency, chronic unemplojnnent, and community deterioration;
(3) hold forth the prospect of continuing to have such impact after the
termination of financial assistance under this part; and (4) provide
financial and other assistance to start, expand, or locate enterprises
in or near the area to be served so as to provide emplojmaent and
ownership opportunities for residents of such areas, including those
who are disadvantaged in the labor market because of their limited
speaking, reading, and writing abilities in the English language.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 491
ESTABLISHMENT AND SCOPE OF PROGRAMS
SEC. 617. (a) The Secretary is authorized to provide financdal Grants.
assistance in the form of grants to nonprofit and for profit community ^2 use 9806.
development corporations and other affiliated and supportive agen-
cies and organizations associated with qualifying community develop-
ment corporations for the payment of all or part of the cost of
programs which are designed to cany out the purposes of this part.
Financial assistance shall be provided so that each community
economic development program is of sufficient size, scope, and
duration to have an appreciable impact on the area served. Such
programs may include—
(1) community business and commercial development pro-
grams, including (A) programs which provide financial and other
assistance (including equity capital) to start, expand, or locate
businesses in or near the area served so as to provide employ-
ment and ownership opportunities for residents of such areas;
and (B) programs for small businesses located in or owned by
residents of such areas;
(2) community physical development programs, including in-
dustrial parks and housing activities, which contribute to an
improved environment and which create new training, employ-
ment and ownership opportunities for residents of such area;
(3) training and public service employment programs and
related services for unemployed or low-income persons which
support and complement community development programs
financed under this part, including, without limitation, activities
such as those described in the Comprehensive Emplo3rment and
Training Act; and
(4) social service programs which support and complement
community business and commercial development programs
financed under this part, including child care, educational serv-
ices, health services, credit counseling, energy conservation,
recreation services, and programs for the maintenance of hous-
ing facilities.
(b) The Secretary shall conduct programs assisted under this part
so as to contribute, on an equitable basis between urban and rural
areas, to the elimination of poverty and the establishment of perma-
nent economic and social benefits in such areas.
FINANCIAL ASSISTANCE REQUIREMENTS
SEC. 618. (a) The Secretary, under such regulations as the Secretary 42 use 9807.
may establish, shall not provide financial assistance for any commu-
nity economic development program under this part unless the
Secretary determines that—
(1) such community development corporation is responsible to
residents of the area served (A) through a governing body not less
than 50 percent of the members of which are area residents; and
(B) in accordance with such other guidelines as may be estab-
lished by the Secretary, except that the composition of the
governing bodies of organizations owned or controlled by the
community development corporation need not be subject to such
residency requirement;
(2) the program will be appropriately coordinated with local
planning under this subchapter with housing and community
development programs, with employment and training pro-
95 STAT. 492 PUBLIC LAW 97-36-AUG. 13,1981
grams, and with other relevant planning for physical and human
resources in the areas served;
(3) adequate technical assistance is made available and com-
mitted to the programs being supported;
(4) such fmancial assistance will materially further the pur-
poses of this part;
(5) the applicant is fulfilling or will fulfill a need for services,
supplies, or facilities which is otherwise not being met;
(6) all projects and related facilities will, to the maximum
feasible extent, be located in the areas served;
(7) projects will, where feasible, promote the development of
entrepreneurial and management skills and the ownership or
participation in ownership of assisted businesses and housing,
cooperatively or otherwise, by residents of the area served;
(8) projects will be planned and carried out with the fullest
possible participation of resident or local businessmen and repre-
sentatives of financial institutions, including participation
through contract, joint venture, partnership, stock ownership or
membership on the governing boards or advisory councils of such
projects consistent with the self-help purposes of this subchapter;
(9) no participant will be employed on projects involving
political parties, or the construction, operation, or maintenance
of so much of any facility as is used or to be used for sectarian
instruction or as a place for religious worship;
(10) the program will not result in the (hsplacement of em-
ployed workers or impair existing contracts for services, or result
in the substitution of Federal or other funds in connection with
work that would otherwise be performed;
(11) the rates of pay for time spent in work training and
education, and other conditions of employment, will be appropri-
ate and reasonable in the light of such factors as the type of work,
geographical region, and proficiency of the participant;
(12) the progreim will, to the maximum extent feasible, contrib-
ute to the occupational development or upward mobility of
individual participants;
(13) preference will be given to low-income or economically
disadvantaged residents of the areas served in filling jobs and
training opportuiiities; and
(14) training programs carried out in connection with projects
financed under this part shall be designed wherever feasible to
provide those persons who successfully complete such training
with skills which are also in demand in communities, neighbor-
hoods, or rural areas other than those for which programs are
established under this part.
(b) Financial assistance under this section shall not be extended to
assist in the relocation of establishments from one location to another
if such relocation would result in a substantial increase in unemploy-
ment in the area of original location.
(c) Financial assistance for commercial development under this
part shall not be extended until the community economic develop-
ment program that has applied for assistance under this subchapter
has specified in some detail its development goals and its develop-
ment timetable. The Secretary, in providing continued financial
assistance to a community economic development program, shall give
serious consideration to the experience such program has had in
meeting development goals or in adhering to development timetables.
PUBLIC LAW 97-35-AUG. 13,1981 95 STAT. 493
FEDERAL SHARE
SEC. 619. (aXD Assistance provided under this subchapter to any 42 use 9808.
program described in section 618(a) shall not exceed 90 percent of the
cost of such program, including costs of administration, unless the
Secretary determines that the assistance in excess of such percentage
is required in furtherance of the purposes of this subchapter. Non-
Federal contributions may be in cash or in kind, fairly evaluated,
including but not limited to plant, equipment, and services.
(2) The assistance referred to in paragraph (1) shall be made
available (A) for deposit to the order of grantees which have demon-
strated successfid program performance, under conditions which the
Secretary deems appropriate, within 80 days following approval of
the grant agreement by the Secretary and such grantee; or (B)
whenever the Secretary deems appropriate, in accordance with
applicable rules and regulations prescribed by the Secretary of the
Treasury, and including any other conditions which the Secretary of
Health and Human Services deems appropriate, within 30 days
following approval of the grant agreement by the Secretary and such
grantee.
(b) Property acquired as a result of capital investments made by
any community development corporation with funds granted as ite
Federal share of the cost of programs carried out under this sub-
chapter, and the proceeds from such property, shall become the
property of the community development corporation and shall not be
considered to be Federal property. The Federal Government retains
the right to direct that on severance of the grant relationship the
assets purchased with grant funds shall continue to be used for the
original purpose for which they were granted.
PART 2—SPECIAL RURAL PROGRAMS
STATEMENT OF PURPOSE
SEC. 620. It is the purpose of this part to meet the special economic 42 use 9809.
needs of rural communities or areas with concentrations or substan-
tigil numbers of low-income persons by providing support to self-help
programs which promote economic development and independence,
as a supplement to existing similar programs conducted by other
departments and agencies of the Federal Government. Such pro-
grams should encourage low-income families to pool their talents and
resources so as to create and expand rural economic enterprise.
FINANCIAL ASSISTANCE
SEC. 621. (a) The Secretary is authorized to provide financial 42 use 9810.
assistance, including loans having a maximum maturity of fifteen
years and in amounts not resulting in an aggregate principal indebt-
edness of more than $3,500 at any one time, to any low-income rural
family where, in the judgment of the Secretary, such financial
assistance has a reasonable possibility of effecting a permanent
increase in the income of such families, or will contribute to the
improvement of their living or housing conditions, by assisting or
permitting them to—
(1) acquire or improve real estate or reduce encumbrances or
erect improvements thereon;
95 STAT. 494 PUBLIC LAW 97-35—AUG. 13, 1981
(2) operate or improve the operation of farms not larger than
family sized, including but not limited to the purchase of feed,
seed, fertilizer, livestock, poultry, and equipment; or
(8) participate in cooperative associations, or finance nonagri-
cultral enterprises which will enable such families to supplement
their income,
(b) The Secretary is authorized to provide financial assistance to
local cooperative associations or local public and private nonprofit
organizations or agencies in rural areas containing concentrations or
substantial numbers of low-income persons for the purpose of defray-
ing all or part of the costs of establishing and operating cooperative
programs for farming, purchasing, marketing, processing, and to
improve their income as producers and their purchasing power as
consumers, and to provide such essentials as credit and health
services. Costs which may be defrayed shall include—
(1) administrative costs of staff and overhead;
(2) costs of planning and developing new enterprises;
(3) costs of acquiring technical assistance; and
(4) initial capital where it is determined by the Secretary that
the poverty of the families participating in the program and the
social conditions of the rural area require such assistance.
UMITATION ON ASSISTANCE
42 use 9811. SEC. 622. No financial assistance shall be provided under this part
unless the Secretary determines that—
(1) any cooperative association receiving assistance has a
minimum of fifteen active members, a majority of which are low-
income rural persons;
(2) adequate technical assistance is made available and com-
mitted to the programs being supported;
(3) such financial assistance will materially further the pur-
poses of this part; and
(4) the applicant is fulfilling or will fulfill a need for services,
supplies, or facilities which is otherwise not being met.
PART 3—DEVELOPMENT LOANS TO COMMUNITY
ECONOMIC DEVELOPMENT PROGRAMS
DEVELOPMENT LOAN FUND
42 use 9812. SEC. 623. (a) The Secretary is authorized to make or guarantee
loans (either directly or in cooperation with banks or other organiza-
tions through agreements to participate on an immediate or deferred
basis) to community development corporations, to families and local
cooperatives and the designated supportive organizations of coopera-
tives eligible for financial assistance under this subchapter, to private
nonprofit organizations receiving assistance under subtitle B of this
Post, p. 511. title, or to public and private nonprofit organizations or agencies, for
business facilities and community development projects, including
community development credit unions, which the Secretary deter-
mines will carry out the purposes of this part. No loans, guarantees,
or other financial assistance shall be provided under this section
unless the Secretary determines that—
(1) there is reasonable assurance of repayment of the loan;
(2) the loan is not otherwise available on reasonable terms
from private sources or other Federal, State, or local programs;
and
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 495
(3) the amount of the loan, together with other funds available,
is adequate to assure completion of the project or achievement of
the purposes for which the loan is made.
Loans made by the Secretary pursuant to this section shall bear
interest at a rate not less than a rate determined by the Secretary of
the Treasury taking into consideration the average market yield on
outstanding Treasury obligations of comparable maturity, plus such
additional charge, if any, toward covering other costs of the program
as the Secretary of Health and Human Services may determine to be
consistent with its purposes, except that, for the 5 years following the
date in which funds are initially available to the borrower, the rate of
interest shall be set at a rate considered appropriate by the Secretary
in light of the particular needs of the borrower, which rate shall not
be lower than 1 percent. All such loans shall be repayable within a
period of not more than 30 years.
Ob) The Secretary is authorized to adjust interest rates, grant
moratoriums on repajmient of principal and interest, collect or
compromise any obligations held by the Secretary, and to take such
other actions in respect to such loans as the Secretary shall deter-
mine to be necessary or appropriate, consistent with the purposes of
this section.
(c)(1) To carry out the lending and guaranty functions authorized Rural
under this part, there shall be established a Development Loan Fund Development
Loan Fund and
consisting of two separate accounts, one of which shall be a revolving Community
fund called the Rural Development Loan Fund and the other of which Development
shedl be a revolving fund called the Community Development Loan Loan Fund^
Fund. The capital of each such revolving fund shall remain available Establishment.
until expended.
(2) The Rural Development Loan Fund shall consist of the remain-
ing funds provided for in part A of title III of the Economic Opportu-
nity Act of 1964, as in effect on September 19,1972, and such amounts 42 u s e 285L
as may be deposited in such fund by the Secretary out of funds made
available from appropriations for purposes of carrying out this part.
The Secretary shgQl utilize the services of the Farmers Home Admin-
istration in administering such fund.
(3) The Community Development Loan Fund shall consist of such
amounts as may be deposited in such fund by the Secretary out of
funds made available from appropriations for purposes of canying
out this subchapter. The Secretary may make deposits in the Commu-
nity Development Loan Fund in any fiscal year in which the Secre-
tary has made available for grants to community development
corporations under this subchapter not less than $60,000,000 out of
funds made available from appropriations for purposes of carrjdng
out this subchapter.
ESTABUSHMENT OF MODEL COMMUNITY ECONOMIC DEVELOPMENT
FINANCE CORPORATION
SEC. 624. To the extent he deems appropriate, the Secretary shall 42 use 9813.
utilize funds available under this part to prepare a plan of action for
the establishment of a Model Community Economic Development
Finance Corporation to provide a user-controlled independent and
professionally operated long-term financing vehicle with the princi-
pal purpose of providing financial support for community economic
development corporations, cooperatives, other affiliated and support-
ive agencies and organizations associated with community economic
development corporations, and other entities eligible for assistance
under this subchapter.
95 STAT. 496 PUBLIC LAW 97-35—AUG. 13, 1981
PART 4—SUPPORTIVE PROGRAMS AND ACTIVITIES
TRAINING AND TECHNICAL ASSISTANCE
42 u s e 9814. SEC. 625. (a) The Secretary shall provide, directly or through
grants, contracts, or other arrangements, such technical assistance
and training of personnel as may be required to effectively imple-
ment the purposes of this subchapter. No financial assistance shall be
provided to any public or private organization under this section
unless the Secretary provides the beneficiaries of these services with
opportunity to participate in the selection of and to review the quality
and utility of the services furnished them by such organization.
(b) Teclmical assistance to community development corporations
and both urban and rural cooperatives may include planning, man-
agement, legal assistance or support, preparation of feasibility stud-
ies, product development, marketing, and the provision of stipends to
encourage skilled professionals to engage in full-time activities under
the direction of a community organization financially assisted under
this subchapter.
(c) Training for employees of community development corporations
and for employees and members of urban and r u r ^ cooperatives shall
include on-the-job training, classroom instruction, and scholarships
to assist them in development, managerial, entrepreneurial, plan-
ning, and other technical and organizational skills which will contrib-
ute to the effectiveness of programs assisted under this subchapter.
SMALL BUSINESS ADMINISTRATION AND DEPARTMENT OF COMMERCE
PROGRAMS
42 u s e 9815. SEC. 626. (aXD Funds granted under this subchapter which are
invested directly or indirectly, in a small investment company, local
development company, limited small business investment company,
or small business investment company licensee under section 301(d)
15 u s e 681. of the Small Business Investment Act of 1958 shall be included as
"private paid-in capital and paid-in surplus", "combined paid-in
capital and paid-in surplus", and "paid-in capital" for purposes of
15 u s e 682, 683, sections 302,303, and 502, respectively, of the Small Business Invest-
696. ment Act of 1958.
Regulations. (2) Not later than 90 days after the date of the enactment of this
Act, the Administrator of the Small Business Administration, after
consultation with the Secretary, shall promulgate regulations to
ensure the availability to community development corporations of
such programs as shall further the purposes of this subchapter,
15 u s e 637. including programs under section 8(a) of the Small Business Act.
(bXl) Areas selected for assistance under this subchapter shall be
deemed "redevelopment areas" within the meaning of section 401 of
42 u s e 3161. the Pubic Works and Economic Development Act of 1965, shall
qualify for assistance under the provisions of title I and title 11 of such
42 u s e 3131, Act, and shall be deemed to have met the overall economic develop-
3141._ ment program requirements of section 202(b)(10) of such Act.
42 u s e 3142.
Regulations. (2) Not later than 90 days after the date of the enactment of this
Act, the Secretary of Commerce shall prescribe regulations which
will ensure that community development corporations Eind coopera-
tives shall qualify for assistance and shall be eligible to receive such
assistance under all such programs of the Economic Development
Administration as shall further the purposes of this subchapter.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 497
DEPARTMENT OP HOUSING AND URBAN DEVELOPMENT PROGRAMS
SEC. 627. The Secretary of Housing and Urban Development, after 42 USC 9816.
consultation with the ^ r e t a r y , shall take all necessary steps to
assist community development corporations and local cooperative
associations to qualify for and receive (1) such assistance in connec-
tion with technical assistance, counseling to tenants and home-
owners, and loans to sponsors of low-income and moderate-income
housing under section 106 of the Housing and Urban Development
Act of 1968, as amended bv section 811 of the Housing and Commu-
nity Development Act of 1974; (2) such land for housing and business 12 uSc i70ix.
location and expansion under title I of the Housing and Community
Development Act of 1974; and (3) such funds for comprehensive 42iJSC530i.
planning under section 701 of the Housing Act of 1954, as amended by
section 401 of the Housing and Community Development Act of 1974, 40 use 461.
as shall further the purposes of this subchapter.
DEPARTMENT OF AGRICULTURE AND FARMERS HOME ADMINISTRATION
PROGRAMS
SEC. 628. The Secretary of Agriculture or, where appropriate, the 42 use 9817.
Administrator of the Farmers Home Administration, after consulta-
tion with the Secretary of Health and Human Services, shall take all
necessary steps to ensure that community development corporations
and local cooperative associations shall qualify for and shall
receive—
(1) such assistance in connection with housing development
under the Housing Act of 1949, as amended; 42 use 1441
(2) such assistance in connection with housing, business, indus- *^°*®-
trial, and community development under the Consolidated
Farmers Home Administration Act of 1961 and the Rural Devel- ^ use 1921 note,
opment Act of 1972; and 7 use 1921 note.
(3) such further assistance under all such programs of the
United States Dep£u*tment of Agriculture; as shall further the
purposes of this subchapter.
COORDINATION AND ELIGIBILITY
SEC. 629. (a) The Secretary shall take all necessary and appropriate 42 use 98i8.
steps to encourage Federal departments and agencies and State and
local governments to make grants, provide technical assistance, enter
into contracts, and generally support and cooperate with community
development corporations and local cooperative associations.
(b) Eligibility for assistance under other Federal programs shall not
be denied to any applicant on the ground that it is a community
development corporation or £my other entity assisted under th&
subchapter.
EVALUATION AND RESEARCH
SEC. 630. (a) Each program for which grants are made under this 42TJSC^gI5.
subchapter shall provide for a thorough evaluation of the effective-
ness of the program in achieving its purposes, which evaluation shall
be conducted by such public or private organizations as the Secretary
in consultation with existing grantees familiar with programs carried
out under the Community Services Block Grant Act may designate. Post, p. 511.
and all or part of the costs of evaluation may be paid from funds
appropriated to carry out this part. In evaluating the performance pf
any community development corporation funded under part 1, the
criteria for evaluation shall be based upon such program objectives.
95 STAT. 498 PUBLIC LAW 97-35—AUG. 13, 1981
goals, and priorities as are consistent with the purposes of this
subchapter and were set forth by such community development
corporation in its proposal for fun(Ung as approved and agreed upon
by or as subsequently modified from time to time by mutual agree-
ment between the Secretary and such community development
corporation.
(b) The Secretary shall conduct, either directly or through grants or
other arrangements, research and demonstration projects designed to
suggest new programs and policies to achieve the purposes of this
subchapter in such ways as to provide opportunities for emplo3rment,
ownership, and a better quality of life for low-income residents.
PLANNING GRANTS
42 use 9820. SEC. 631. In order to facilitate the purposes of this subchapter, the
Secretary is authorized to provide financial assistance to any public
or private nonprofit agency or organization for planning of commu-
nity economic development programs and cooperative programs
under this subchapter.
NONDISCRIMINATION PROVISIONS
42 use 9821. SEC. 632. (a) The Secretary shall not provide financial assistance for
any program, project, or activity under this subchapter unless the
grant or contract with respect thereto specifically provides that no
person with responsibilities in the operation thereof will discriminate
with respect to any such program, project, or activity because of race,
creed, color, national origin, sex, political affiliation, or beliefs,
(b) No person in the United States shall on the ground of sex be
excluded from participation in, be denied the benefits of, be subjected
to discrimination under, or be denied employment in connection with
any program or activity receiving assistance under this subchapter.
The Secretary shall enforce the provisions of the preceding sentence
42 use 2000d-i. in accordance with section 602 of the Civil Rights Act of 1964. Section
42 use 2000d-2. 603 of such Act shall apply with respect to any action taken by the
Secretary to enforce such sentence. This section shall not be con-
strued as affecting any other legal remedy that a person may have if
such person is excluded from participation in, denied the benefits of,
subjected to discrimination under, or denied employment in connec-
tion with, any program, project, or activity receiving assistance under
this subchapter.
AVAILABILITY OP CERTAIN APPROPRIATED FUNDS
42 use 9822. SEC. 633. Funds appropriated to the Rural Development Loan Fund
42 use 2981. under title VII of the Economic Opportunity Act of 1964 (as in effect
on the day before the date of the enactment of this Act), and interest
accumulated in such fund, shall be deposited in the Rural Develop-
ment Loan Fund established under section 623(c)(1) and shall con-
tinue to be available to carry out the purposes of such fund. Funds
appropriated to the Community Development Credit Union Revolv-
ing Loan Fund under title VII of the Economic Opportunity Act of
1964 (as in effect on the day before the date of the enactment of this
Act), and interest accumulated in such fund, shall continue to be
available to carry out the purposes of such fund.
PUBLIC LAW 97-35—AUG. 13,1981 95 STAT. 499
Subchapter B—Head Start Programs Head start Act.
SHORT TTTLE
SEC. 635. This subchapter may be cited as the "Head Start Act". 42 use 980i
note.
STATEMENT OF PURPOSE AND POUCY
SEC. 636. (a) In recognition of the role which Project Head Start has 42 use 9831.
played in the effective delivery of comprehensive health, educational,
nutritional, social, and other services to economically disadvantaged
children and their families, it is the jpurpose of this subchapter to
extend the authority for the appropriation of funds for such program.
(b) In carrying out the provisions of this subchapter, the Secretary
of Health and Human Services shall continue the administrative
arrangement responsible for meeting the needs of migrant and
Indian children and shall assure that appropriate funding is provided
to meet such needs.
DEFINrnONS
SEC. 637. For purposes of this subchapter: 42 use 9832.
(1) The term "Secretary" means the Secretary of Health and
Human Services.
(2) The term "State" means a State, the Commonwealth of
Puerto Rico, the District of Columbia, Guam, American Samoa,
the Virgin Islands, the Trust Territory of the Pacific Islands, and
the Northern Mariana Islands.
(3) The term "financial assistance" includes assistance pro-
vided by grant, agreement, or contract, and payments may be
made in installments and in advance or by way of reimburse-
ment with necessary adjustments on account of overpayments or
underpa}mients.
FINANCIAL ASSISTANCE FOR HEAD START PROGRAMS
SEC. 638. The Secretary may, upon application by an agency which 42 use 9833.
is eligible for designation as a Head Start agency pursuant to section
641, provide financial assistance to such agency for the planning,
conduct, administration, and evaluation of a Head Start program
focused primarily upon children from low-income families who have
not reached the age of compulsory school attendance which (1) will
provide such comprehensive health, nutritional, educational, social,
and other services as will aid the children to attain their full
potential; and (2) will provide for direct participation of the parents of
such children in the development, conduct, and overall program
direction at the local level.
AUTHORIZATION OF APPROPRIATIONS
SEC. 639. There is authorized to be appropriated for carrying out 42 use 9834.
the provisions of this subchapter $950,000,000 for fiscal year 1982,
$1,007,000,000 for fiscal year 1983, and $1,058,357,000 for fiscal year
1984.
ALLOTMENT OF FUNDS; UMITATIONS ON ASSISTANCE
SEC. 640. (aXD Of the sums appropriated pursuant to section 639 for 42 use 9835.
any fiscal year beginning after September 30, 1981, the Secretary
shall allot such sums in accordance with paragraphs (2) and (3).
95 STAT. 500 PUBLIC LAW 97-35~-AUG. 13,1981
(2) The Secretary shall reserve 13 percent of the amount appropri-
ated for each fiscal year for use in accordance with the following
order of priorities—
(A) Indian and migrant Head Start programs and services for
handicapped children, except that—
(i) there shall be made available for use by Indian and
migrant Head Start programs, on a nationwide basis, no less
funds for fiscal year 1982 and each subsequent fiscal year
than were obligated for use by Indian and migrant Head
Start programs for fiscal year 1981; and
(ii) cost-of-living adjustments shall be made with respect to
such Indian and migrant Head Stsirt programs for fiscal year
1982 and each subsequent fiscal year, and such adjustments
shall, at the minimum, reflect changes in the Consumer
Price Index published by the Bureau of Labor Statistics of
the Department of Labor;
(B) payments to Guam, American Samoa, the Trust Territory
of the Pacific Islands, the Northern Mariana Islands, and the
Virgin Islands according to their respective needs, except that
such amount shall not exceed one-half of 1 percent of the sums
appropriated for any fiscsil year;
(C) training and technical assistance activities which are
sufficient to meet the needs associated with program expansion
and to foster program and management improvement activities;
and
(D) discretionary payments made by the Secretary.
(3) The Secretary shall allot the remaining 87 percent of the
amounts appropriated in each fiscal year among the States, in
accordance with latest satisfactory data so that—
(A) each State receives an amount which is equal to the
amount the State received for fiscal year 1981; and
(B)(i) 33 Va percent of any amount available after all allotments
have been made under clause (A) for such fiscal year shall be
distributed on the basis of the relative number of children from
birth through 18 years of age, on whose behalf pajrments are
made under the program of aid to families with dependent
children under a State plan approved under part A of title IV of
the Social Security Act in each State £is compared to all States;
and
(ii) 66% percent of such amount shall be distributed on the
basis of the relative number of children from birth through 5
years of age living with families with incomes below the poverty
line in each State as compared to all States.
(4) For purposes of this subsection, the term "State" does not
include Guam, American Samoa, the Virgin Islands, the Northern
Mariana Islands, or the Trust Territory of the Pacific Islands.
(b) Financial assistance extended under this subchapter for a Head
Start program shall not exceed 80 percent of the approved costs of the
assisted program or activities, except that the Secretary may approve
assistance in excess of such percentage if the Secretary determines, in
accordance with regulations establishing objective criteria, that such
action is required in furtherance of the purposes of this subchapter.
Non-Feder£d contributions may be in cash or in kind, fairly evalu-
ated, including plant, equipment, or services. The Secretary shall not
require non-Federal contributions in excess of 20 percent of the
approved costs of programs or activities assisted under this sub-
chapter.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 501
(c) No programs shall be approved for assistance under this
subchapter unless the Secretary is satisfied that the services to be
provided under such program will be in addition to, and not in
substitution for, comparable services previously provided without
Federal assistance. The requirement imposed by the preceding sen-
tence shall be subject to such regulations as the Secretary may
prescribe.
(d) The Secretary shall establish policies and procedures designed
to assure that for fiscal year 1982 and thereafter no less than 10
g ercent of the total number of enrollment opportunities in Head
tart programs in each State shall be available for handicapped
children (as defined in paragraph (1) of section 602 of the Education of
the Handicapped Act) and that services shall be provided to meet 20 u s e 3192.
their special needs. The Secretary shall report to the Congress at Report to
least annually on the status of handicapped children in Head Start Congress.
programs, including the number of children being served, their
handicapping conditions, and the services being provided such
children.
(e) The Secretary shall adopt appropriate administrative measures
to assure that the benefits of this subchapter will be distributed
equitably between residents of rural and urban areas.
DESIGNATION OF HEAD START AGENCIES
SEC. 641. (a) The Secretary is authorized to designate as a Head 42 use 9836.
Start agency any local public or private nonprofit agency which (1)
has the power and authority to carry out the purposes of this
subchapter and perform the functions set forth in section 642 within
a community; and (2) is determined by the Secretary to be capable of
planning, conducting, administering, and evaluating, either directly
or by other arrangements, a Head Start program.
(b) For purposes of this subchapter, a community may be a city, "eommunity.'
county, or multicity or multicounty unit within a State, an Indian
reservation, or a neighborhood or other area (irrespective of bound-
aries or political subdivisions) which provides a suitable organiza-
tional base and possesses the commonality of interest needed to
operate a Head Start program.
(c) In the administration of the provisions of this section, the
Secretary shall give priority in the designation of Head Start agen-
cies to any local public or private nonprofit agency which is receiving
funds under any Head Start program on the date of the enactment of
this Act, except that—
(1) the Secretary shall, before giving such priority, determine
that the agency involved meets program and fiscal requirements
established by the Secretary; and
(2) if there is no such agency because of any change in the
assistance furnished to programs for economically disadvantaged
persons, then the Secretary shall give priority in the designation
of Head Start agencies to any successor agency which is operated
in substantially the same manner as the predecessor agency
which did receive funds in the fiscal year preceding the fiscal
year for which the determination is made.
The provisions of clause (2) shall apply only to agencies actually
operating Head Start programs.
(d) The Secretary shall require that the practice of significantly
involving parents and area residents affected by the program in
selection of Head Start agencies be continued.
95 STAT. 502 PUBLIC LAW 97-35—AUG. 13, 1981
POWERS AND FUNCTIONS OF HEAD START AGENCIES
42 use 9837. SEC. 642. (a) In order to be designated as a Head Start agency under
this subchapter, an agency must have authority under its charter or
applicable law to receive and administer funds under this subchapter,
funds and contributions from private or local public sources which
may be used in support of a Head Start program, and funds under any
Federal or State assistance program pursuant to which a public or
private nonprofit agency (as the case may be) organized in accordance
with this subchapter, could act as grantee, contractor, or sponsor of
projects appropriate for inclusion in a Head Start program. Such an
agency must also be empowered to transfer funds so received, and to
delegate powers to other agencies, subject to the powers of its
governing board and its overall program responsibilities. The power
to transfer funds and delegate powers must include the power to
make transfers and delegations covering component projects in all
cases where this will contribute to efficiency and effectiveness or
otherwise further program objectives.
(b) In order to be so designated, a Head Start agency must also (1)
establish effective procedures by which parents and area residents
concerned will be enabled to directly participate in decisions that
influence the character of programs affecting their interests; (2)
provide for their regular participation in the implementation of such
programs; (3) provide technical and other support needed to enable
parents and area residents to secure on their own behalf available
assistance from public and private sources; and (4) establish proce-
dures to seek reimbursement, to the extent feasible, from other
agencies for services for which any such other agency is responsible,
which are provided to a Head Start participant by the Head Start
agency.
(c) The head of each Head Start agency shall coordinate with other
programs serving the children in the Head Start agency to carry out
the provisions of this subsection.
SUBMISSION OF PLANS TO GOVERNORS
42 use 9838. SEC. 643. In carrjdng out the provisions of this subchapter, no
contract, agreement, grant, or other assistance shall be liiade for the
purpose of carrying out a Head Start program within a State unless a
plan setting forth such proposed contract, agreement, grant, or other
assistance has been submitted to the Governor of the State, and such
plan has not been disapproved by the Governor within 30 days of such
submission, or, if so disapproved, has been reconsidered by the
Secretary and found by the Secretary to be fully consistent with the
provisions and in furtherance of the purposes of this subchapter.
Funds to cover the costs of the proposed contract, agreement, grant,
or other assistance shall be obligated from the appropriation which is
current at the time the plan is submitted to the Governor. This
section shall not, however, apply to contracts, agreements, grants,
loans, or other assistance to any institution of higher education in
existence on the date of the enactment of this Act.
ADMINISTRATIVE REQUIREMENTS AND STANDARDS
42 use 9839. SEC. 644. (a) Each Head Start agency shall observe standards of
organization, management, and administration which will assure, so
far as reasonably possible, that all program activities are conducted
in a manner consistent with the purposes of this subchapter and the
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 503
objective of providing assistance effectively, efficiently, and free of
any taint of partisan political bias or personal or family favoritism.
Each such agency shall establish or adopt rules to carry out this
section, which shall include rules to assure full staff accountability in
matters governed by law, regulations, or agency policy. Each agency
shall also provide for reasonable public access to information, includ-
ing public hearings at the request of appropriate community groups
and reasonable public access to books and records of the agency or
other agencies engaged in program activities or operations involving
the use of authority or funds for which it is responsible. Each such
agency shall adopt for itself and other agencies using funds or
exercising authority for which it is responsible, rules designed to (1)
establish specific standards governing salaries, salary increases,
travel and per diem allowances, and other employee benefits; (2)
assure that only persons capable of discharging their duties with
competence and integrity are employed and that employees are
promoted or advanced under impartisd procedures calculated to
improve agency performance and effectiveness; (3) guard against
personal or financial conflicts of interest; and (4) define employee
duties in an appropriate manner which will in any case preclude
employees from participating, in connection with the performance of
their duties, in any form of picketing, protest, or other direct action
which is in violation of law.
(b) No financial assistance shall be extended under this subchapter
in any case in which the Secretary determines that the costs of
developing and administering a program assisted under this sub-
chapter exceed 15 percent of the total costs, including non-Federal
contributions to such costs, of such program. The Secretary shall
establish by regulation, criteria for determining (1) the costs of
developing and administering such program; and (2) the total costs of
such program. In any case in which the Secretary determines that the
cost of administering such program does not exceed 15 percent of
such total costs but is, in the judgment of the Secretary, excessive, the
Secretary shall forthwith require the recipient of such financial
assistance to take such steps prescribed by the Secretary as will
eliminate such excessive administrative cost, including the sharing
by one or more Head Start agencies of a common director and other
administrative personnel. The Secretary may waive the limitation
prescribed by this subsection for specific periods of time not to exceed
12 months whenever the Secretary determines that such a waiver is
necessary in order to carry out the purposes of this subchapter.
(c) The Secretary shall prescribe rules or regulations to supplement Regulations
subsection (a), which shall be binding on all agencies carrying on
Head Start program activities with financial assistance under this
subchapter. The Secretary may, where appropriate, establish special
or simplified requirements for smaller agencies or agencies operating
in rural areas. Policies and procedures shall be established to ensure
that indirect costs attributable to the common or joint use of facilities
and services by programs assisted under this subchapter and other
programs shall be fairly allocated among the various programs which
utilize such facilities and services,
(d) At least 30 days prior to their effective date, all rules, regula- Publication in
tions, guidelines, instructions, and application forms shall be pub- Federal
lished in the Federal Register and shall be sent to each grantee with Register.
the notification that each such grantee h£is the right to submit
comments pertaining thereto to the Secretary prior to the final
adoption thereof.
89-194 0—82 34:QL3
95 STAT. 504 PUBLIC LAW 97-35—AUG. 13, 1981
PARTICIPATION IN HEAD START PROGRAMS
42 use 9840. SEC. 645. (a)(1) The Secretary shall by regulation prescribe eligibil-
ity for the participation of persons in Head Start programs assisted
under this subchapter. Except as provided in paragraph (2), such
criteria may provide (A) that children from low-income families shall
be eligible for participation in programs assisted under this sub-
chapter if their families' incomes are below the poverty line, or if
their families are eligible or, in the absence of child care, would
potentially be eligible for public assistance; and (B) pursuant to such
regulations as the Secretary shall prescribe, that programs assisted
under this subchapter may include, to a reasonable extent, participa-
tion of children in the area served who would benefit from such
programs but whose families do not meet the low-income criteria
prescribed pursuant to clause (A).
(2) Whenever a Head Start program is operated in a community
with a population of 1,000 or less individuals and—
(A) there is no other preschool program in the community;
(B) the community is located in a medically underserved area,
as designated by the Secretary pursuant to section 330(bX3) of the
42 use 254c. Public Health Service Act and is located in a health manpower
shortage area, as designated by the Secretary pursuant to section
42 use 254e. 332(a)(1) of such Act;
(C) the community is in a location which, by reason of remote-
ness, does not permit reasonable access to the types of services
described in clauses (A) and (B); and
(D) not less than 50 percent of the families to be served in the
community are eligible under the eligibility criteria established
by the Secretary under paragraph (1);
the Head Start program in each such locality shall establish the
criteria for eligibility, except that no child residing in such commu-
nity whose family is eligible under such eligibility criteria shall, by
virtue of such project's eligibility criteria, be denied an opportunity to
participate in such program.
(b) The Secretary shall not prescribe any fee schedule or otherwise
provide for the charging of any fees for participation in Head Start
programs, unless such fees are authorized by legislation hereafter
enacted. Nothing in this subsection shall be construed to prevent the
families of children who participate in Head Start programs and who
are willing and able to pay the full cost of such participation from
doing so.
APPEALS, NOTICE, AND HEARING
42 use 9841. SEC. 646. The Secretary shall prescribe procedures to assure that—
(1) special notice of and an opportunity for a timely and
expeditious appeal to the Secretary will be provided for an
agency or organization which desires to serve as a delegate
agency under this subchapter and whose application to the Head
Start agency has been wholly or substantially rejected or has not
been acted upon within a period of time deemed reasonable by
the Secretary, in accordance with regulations which the Secre-
tary shall prescribe;
(2) financial assistance under this subchapter shall not be
suspended, except in emergency situations, unless the recipient
agency has been given reasonable notice and opportunity to show
cause why such action should not be taken; and
(3) financial assistance under this subchapter shall not be
terminated, an application for refunding shall not be denied, and
PUBLIC LAW 97-36—AUG. 13, 1981 95 STAT. 605
a suspension of financial assistance shall not be continued for
longer than 30 days, unless the recipient has been afforded
reasonable notice and opportunity for a full and fair hearing.
RECORDS AND AUDITS
SEC. 647. (a) Each recipient of financial assistance under this 42 use 9842.
subchapter shall keep such records as the Secretary shall prescribe,
including records which fully disclose the amount and disposition by
such recipient of the proceeds of such financial-assistance, the total
cost of the project or undertaking in connection with which such
financial assistance is given or used, the amount of that portion of the
cost of the project or undertaking supplied by other sources, and such
other records as will facilitate an effective audit.
(b) The Secretary and the Comptroller General of the United
States, or any of their duly authorized representatives, shall have
access for the purpose of audit and examination to any books,
documents, papers, and records of the recipients that are pertinent to
the financial assistance received under this subchapter.
TECHNICAL ASSISTANCE AND TRAINING
SEC. 648. The Secretary may provide, directly or through grants or 42 use 9843.
other arrangements (1) technical assistance to communities in devel-
oping, conducting, and administering programs under this sub-
chapter; and (2) training for specialized or other personnel needed in
connection with Head Start programs.
R E S E A R C H , DEMONSTRATION, AND PILOT PROJECTS
SEC. 649. (a) The Secretanr may provide financial assistance Grants and
through grants or contracts for research, demonstration, or pilot 42"TVCP*^Q44
projects conducted by public or private agencies which are designed
to test or Eissist in the development of new approaches or methods
that will aid in overcoming special problems or otherwise in further-
ing the purposes of this subchapter.
(b) The Secretary shall establish an overall plan to govern the
approval of research, demonstration, or pilot projects and the use of
all research authority under this subchapter. Such plan shall set
forth specific objectives to be achieved and priorities among such
objectives.
ANNOUNCEMENT OF RESEARCH, DEMONSTRATION, AND PILOT PROJECTS
CONTRACTS
SEC. 650. (a) The Secretary shall make a public announcement 42 use 9845.
concerning—
(1) the title, purpose, intended completion date, identity of the
grantee or contractor, and proposed cost of any grant or contract
with a private or non-Federal public agency or organization for
any research, demonstration, or pilot project under this sub-
chapter; and
(2) the results, findings, data, or recommendations made or
reported as a result of such activities.
(b) The public announcements required by subsection (a)(1) shall be
made within 80 days of making such grants or contracts, and the
public announcements required by subsection (aX2) shall be made
within 90 days of the receipt of such results.
95 STAT. 506 PUBLIC LAW 97-35—AUG. 13, 1981
(c) The Secretary shall take necessary action to assure that all
studies, proposals, and data produced or developed with Federal
funds employed under this subchapter shall become the property of
the United States.
(d) The Secretary shall publish summaries of the results of activi-
ties carried out pursuant to this subchapter not later than 90 days
Report to after the completion thereof. The Secretary shall submit to the
congressional appropriate committees of the Congress copies of all such summaries.
committees.
EVALUATION
Grants and SEC. 651. (a) The Secretary shall provide, directly or through grants
contracts. or contracts, for the continuing evaluation of programs under this
42 u s e 9846.
subchapter, including evaluations that measure and evaluate the
impact of programs authorized by this subchapter, in order to
determine their effectiveness in achieving stated goals, their impact
on related programs, and their structure and mechanisms for deliv-
ery of services, including, where appropriate, comparisons with
appropriate control groups composed of persons who have not partici-
pated in such programs. Evaluations shgdl be conducted by persons
not directly involved in the administration of the progr£im or project
operation.
Ot)) The Secretary shall operate the programs and projects covered
by this subchapter in accordance with Head Start performance
standards. Any revisions in such standards shall result in standards
which are no less comprehensive than those in effect on the date of
42 u s e 2701 the enactment of the Economic Opportunity Amendments of 1978.
note. The extent to which such standards have been met shall be consid-
ered in deciding whether to renew or supplement financial assistance
authorized under this subchapter.
(cXD In carrjdng out evaluations under this subchapter, the Secre-
tary shall establish working relationships with the faculties of
colleges or universities located in the area in which any such
evaluation is being conducted, unless there is no such college or
university willing and able to participate in the evaluation. For
purposes of the preceding sentence, for any single evaluation, areas
in which such working relationships are established may not be
larger than 3 contiguous States.
(2) In carrying out evaluations under this subchapter, the Secretary
may require Head Start agencies to provide for independent
evsduations.
(d) In carrying out evaluations under this subchapter, the Secre-
tary shall, whenever feasible, arrange to obtain the specific views of
persons participating in and served by programs and projects assisted
under this subchapter about such programs and projects.
(e) The Secretanr shall publish the results of evaluative research
and summaries of evaluations of program and project impact and
Report to effectiveness not later than 90 days after the completion thereof. The
congressional Secretary shall submit to the appropriate committees of the Congress
committees.
copies of all such research studies and evaluation summaries.
(f) The Secretary shall take the necessary action to assure that all
studies, evaluations, proposals, and data produced or developed with
assistance under this subchapter shall become the property of the
United States.
POVERTY UNE
42 u s e 9847. SEC. 652. (a) The Secretary shall revise annually (or at any shorter
interval the Secretary deems feasible and desirable) a poverty line
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 507
which, except as provided in section 645, shall be used as a criterion of
eligibility for participation in Head Start programs.
(b) The revision required by subsection (a) shall be accomplished by
multiplying the official poverty line (as defined by the Office of
Management and Budget) by the percentage change in the Consumer
Price Index during the annual or other interval immediately preced-
ing the time at which the revision is made.
(c) Revisions required by subsection (a) shall be made and issued not
more than 30 days after the date on which the necessary Consumer
Price Index data become available.
COMPARABILITY OF WAGES
SEC. 653. The Secretary shall take such action as may be necessary 42 use 9848.
to assure that persons employed in canying out programs financed
under this subchapter shall not receive compensation at a rate which
is (1) in excess of the average rate of compensation paid in the area
where the program is carried out to a substantial number of the
persons providing substantially comparable services, or in excess of
the average rate of compensation paid to a substantial number of the
persons providing substantially comparable services in the area of
the person's immediately preceding emplo5mient, whichever is
higher; or (2) less than the minimum wage rate prescribed in section
6(a)(1) of the Fair Labor Standards Act of 1938. 29 use 206.
NONDISCRIMINATION PROVISIONS
SEC. 654. (a) The Secretary shall not provide financial assistance for 42 use 9849.
any program, project, or activity under this subchapter unless the
grant or contract with respect thereto specifically provides that no
person with responsibilities in the operation thereof will discriminate
with respect to any such program, project, or activity because of race,
creed, color, national origin, sex, political affiliation, or beliefs.
(b) No person in the United States shall on the ground of sex be
excluded from participation in, be denied the benefits of, be subjected
to discrimination under, or be denied emplojrment in connection with
any program or activity receiving assistance under this subchapter.
The Secretary shall enforce the provisions of the preceding sentence
in accordance with section 602 of the Civil Rights Act of 1964. Section 42 use 2000d-i,
603 of such Act shall apply with respect to any action taken by the 2000d-2.
Secretary to enforce such sentence. This section shall not be con-
strued as affecting any other legal remedy that a person may have if
such person is excluded from participation in, denied the benefits of,
subjected to discrimination under, or denied employment in connec-
tion with, any program, project, or activity receiving assistance under
this subchapter.
(c) The Secretary shall not provide financial assistance for any
program, project, or activity under this subchapter unless the grant
or contract relating to the financial assistance specifically provides
that no person with responsibilities in the operation of the program,
project, or activity will discriminate against any individual because of
a handicapping condition in violation of section 504 of the Rehabilita-
tion Act of 1973. 29 use 794.
UMITATION WITH RESPECT TO CERTAIN UNLAWFUL ACTIVITIES
SEC. 655. No individual employed or assigned by any Head Start 42 use 9850.
agency or other agency assisted under this subchapter shall, pursu-
95 STAT. 508 PUBLIC LAW 97-35—AUG. 13, 1981
ant to or during the performance of services rendered in connection
with any program or activity conducted or assisted under this
subchapter by such Head Start agency or such other agency, plan,
initiate, participate in, or otherwise aid or assist in the conduct of any
unlawful demonstration, rioting, or civil disturbance.
POLITICAL ACTIVITIES
42 use 9851. SEC. 656. (a) For purposes of chapter 15 of title 5, United States
5 use 1501 et Code, any agency which assumes responsibility for planning, develop-
*^9- ing, and coordinating Head Start programs and receives assistance
under this subchapter shall be deemed to be a State or local agency.
5 use 1502. For purposes of clauses (1) and (2) of section 1502(a) of such title, any
agency receiving assistance under this subchapter shall be deemed to
be a State or local agency.
Oi>) Programs assisted under this subchapter shall not be carried on
in a manner involving the use of program funds, the provision of
services, or the emplojmient or assignment of personnel in a manner
supporting or resulting in the identSication of such programs with (1)
any partisan or nonpartiseui political activity or any other political
activity associated with a candidate, or contending faction or group,
in an election for public or party office; (2) any activity to provide
voters or prospective voters with transportation to the polls or
similar assistance in connection with any such election; or (3) any
voter registration activity. The Secretary, after consultation with the
Office of Personnel Management, shall issue rules and regulations to
provide for the enforcement of this section, which shall include
provisions for summary suspension of assistance or other action
necessary to permit enforcement on an emergency basis.
ADVANCE FUNDING
42 use 9852. SEC. 657. For the purpose of affording adequate notice of funding
available under this subchapter, appropriations for carrying out this
subchapter are authorized to be included in an appropriation Act for
the fiscal year preceding the fiscal year for which they are available
for obligation.
Follow Through Subchapter C—Follow Through Programs
Act.
SHORT TITLE
42 use 9801 SEC. 661. This subchapter may be cited as the "Follow Through
note. Act".
FINANCIAL ASSISTANCE FOR FOLLOW THROUGH PROGRAMS
42 use 9861. SEC. 662. (a) The Secretary of Education (hereinafter in this
subchapter referred to as the "Secretary") is authorized to provide
financial assistance in the form of grants to local educational agen-
cies, combinations of such agencies, and, as provided in subsection (b),
any other public or appropriate nonprofit private agencies, organiza-
tions, and institutions for the purpose of canying out Follow Through
programs focused primarily on children from low-mcome families in
kindergarten and primary grades, including such children enrolled
in private nonprofit elementary schools, who were previously en-
rolled in Head Start or similar programs. Other children in kinder-
garten and primary grades, including such other children enrolled in
private nonprofit elementary schools, who were previously enrolled
in preschool programs of a compensatory nature which received
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 509
Federal financial assistance may participate in such Follow Through
programs.
(b) Whenever the Secretary determines—
(1) that a local educational agency receiving assistance under
subsection (a) is unable or unwilling to include in a Follow
Through program children enrolled in nonprofit private schools
who would otherwise be eligible to participate therein; or
(2) that it is otherwise necessary in order to accomplish the
purposes of this section;
the Secretary may provide financial assistance for the purpose of
carrying out a Follow Through program to any other public or
appropriate nonprofit private agency, organization, or institution.
(c) Programs to be assisted under this section shall provide such
comprehensive educational, health, nutritional, social, and other
services as will aid in the continued development of children
described in subsection (a) to their full potential. Such projects shall
provide for the direct participation of the parents of such children in
the development, conduct, and overall direction of the program at the
local level. If the Secretary determines that participation in the
project of children who are not from low-income families will serve to
carry out the purposes of this section, the Secretary may provide for
the inclusion of such children from non-low-income families, but only
to the extent that their participation will not dilute the effectiveness
of the services designed for children described in subsection (a).
AUTHORIZATION OP APPROPRIATIONS
SEC. 668. (aXD There is authorized to be appropriated for carrying 42 use 9862.
out the purposes of this subchapter $44,300,000 for fiscal year 1982,
$22,150,000 for fiscal year 1983, and $14,767,000 for fiscal year 1984.
(2) Funds appropriated under this section for fiscal years 1982 and
1983 shall remedn available for obligation and expenditure during the
fiscal year succeeding the fiscal year for which they are appropriated.
(b) Financial £issistance extended under this subchapter for a
Follow Through program shall not exceed 80 percent of the approved
costs of the assisted program or activities, except that the Secretary
may approve assistance in excess of such percentage if the Secretary
determines, in accordance with regulations establishing objective
criteria, that such action is required in furtherance of the purposes of
this subchapter. Non-Federal contributions may be in cash or in kind,
fairly evEiluated, including plant, equipment, or services. The Secre-
tary shall not require non-Federal contributions in excess of 20
percent of the approved costs of programs or activities assisted under
this subchapter.
(c) No project shall be approved for assistance under this sub-
chapter unless the Secretary is satisfied that the services to be
provided under such project will be in addition to, and not in
substitution for, services previously provided without Federal assist-
ance. The requirement imposed by the preceding sentence shall be
subject to such regulations as the Secretary may adopt.
RESEARCH, DEMONSTRATION, AND PILOT PROJECTS
SEC. 664. (a) The Secretary may provide financial assistance 42 use 9863.
through grants or contracts for research, demonstration, or pilot
projects conducted by public and private agencies which are designed
to test or assist in the development of new approaches or methods
95 STAT. 510 PUBLIC LAW 97-35—AUG. 13, 1981
that will aid in overcoming special problems or in otherwise further-
ing the purposes of this subchapter.
0)) The Secretary shall establish an overall plan to govern the
approval of research, demonstration, or pilot prmects and the use of
all research authority under this subchapter. Such plan shall set
forth specific objectives to be achieved and priorities among such
objectives.
ANNOUNCEMENT OF RESEARCH, DEMONSTRATION, AND PILOT PROJECT
CONTRACTS
42 u s e 9864. SEC. 665. (a) The Secretary shall make a public announcement
concerning—
(1) the title, purpose, intended completion date, identity of the
grantee or contractor, and proposed cost of any grant or contract
with a private or non-Federal public agency or organization for
any research, demonstration, or pilot project under this sub-
chapter; and
(2) the results, findings, data, or recommendations made or
reported as a result of such activities.
(b) The public announcements required by subsection (a)(1) shall be
made not later than 30 days after making such grants or contracts,
and the public announcements required by subsection (aX2) shall be
made not later than 90 days after the receipt of such results.
(c) The Secretary shall take necessary action to assure that all
studies, proposals, and data produced or developed with Federal
funds employed under this subchapter shall become the property of
the United States.
Summaries, (d) The Secretary shall publish summaries of the results of activi-
submittal to ties carried out pursuant to this subchapter not later than 90 days
congressional
committees. after the completion thereof The Secretary shall submit to the
appropriate committees of the Congress copies of all such summaries.
EVALUATION
42 u s e 9865. SEC. 666. (a) The Secretary shall provide, directly or through grants
or contracts, for the continuing evaluation of programs under this
subchapter, including evaluations that measure and evaluate the
impact of programs authorized by this subchapter, in order to
determine their effectiveness in achieving stated goals, their impact
on related programs, and their structure and mechanism for delivery
of services, including, where appropriate, comparisons with appropri-
ate control groups composed of persons who have not participated in
such programs. Evaluations shall be conducted by persons not
directly involved in the administration of the program or project.
(b) The Secretary shall develop and publish general standards for
evaluation of program and project effectiveness in achieving the
objectives of this subchapter. The extent to which such standards
have been met shall be considered in deciding whether to renew or
supplement financial assistance authorized under this subchapter.
(c) In carrying out evaluations under this subchapter, the Secretary
shall, whenever feasible, arrange to obtain the specific views of
persons participating in and served by programs and projects assisted
under this subchapter about such programs and projects.
Submittal to (d) The Secretary shall publish the results of evaluative research
congressional
committees. and summaries of evaluations of program and project impact and
effectiveness not later than 90 days after the completion thereof The
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 511
Secretary shall submit to the appropriate committees of the Congress
copies of all such research studies and evaluation summaries.
(e) The Secretary shall take the necessary action to assure that all
studies, evaluations, proposals, and data produced or developed with
assistance under this section become the property of the United
States.
TECHNICAL ASSISTANCE AND TRAINING
SEC. 667. The Secretary may provide, directly or through grants or 42 use 9866.
other appropriate arrangements (1) technical assistance to Follow
Througn programs in developing, conducting, and administering
programs under this subchapter; and (2) training for specialized or
other personnel which is nei^ed in connection with Follow Through
programs.
SPECIAL CONDITIONS
SEC. 668. (a) Recipients of financial assistance under this sub- 42 use 9867.
chapter shall provide maximum employment opportunities for resi-
dents of the area to be served, and to parents of children who are
participating in projects assisted under this subchapter.
(b) Fmancial assistance under this subchapter shall not be suspend-
ed for failure to comply with applicable terms and conditions, except
in emergency situations, nor shall an application for refunding be
denied, unless the recipient agency has been given reasonable notice
and opportunity to show cause why such action should not be taken.
(c) Fmancial assistance under tnis subchapter shall not be termi-
nated for failure to comply with applicable terms and conditions
unless the recipient has been afforded reasonable notice and opportu-
nity for a full and fair hearing.
APPUCABIUTY OF PROVISIONS OF SUBCHAPTER B
SEC. 669. The provisions of sections 637 (other than section 637(1)), 42 Use 9868.
653, 654, 655, 656, and 657 shall apply to the administration of tMs
subchapter.
REPEALER
SEC. 670. Effective October 1,1984, the provisions of this subchapter Ante, p. 508.
are repealed. ^^F^Jf^K
^ note, 9801 note.
Subtitle B—Community Services Block Grant Program ^JJJj^^'^^fock
Grant Act.
SHORT TITLE
SEC. 671. This subtitle may be cited as the "Community Services 42 use 990i
Block Grant Act". *^ote.
COMMUNITY SERVICES GRANTS AUTHORIZED
SEC. 672. (a) The Secretary is authorized to make grants in 42 use 9901.
accordance with the provisions of this subtitle, to States to ameliorate
the causes of poverty in communities within the State.
(b) There is authorized to be appropriated $389,375,000 for the fiscal
year 1982 and for each of the 4 succeeding fiscal years to carry out the
provisions of this subtitle.
DEFINITIONS
SEC. 673. For purposes of this subtitle: 42 use 9902.
95 STAT. 512 PUBLIC LAW 97-35--AUG. 13, 1981
(1) The term "eligible entity" means any organization which
was officially designated as a community action agency or a
conmiunity action program under the provisions of section 210 of
42 use 2790. the Economic Opportunity Act of 1964 forfiscalyear 1981, unless
such community action agency or a conmiunity action program
lost its designation under section 210 of such Act as a result of a
failure to comply with the provisions of such Act.
(2) The term "poverty line" means the official poverty line
established by the Director of the Office of Management and
Budget. The Secretary shall revise the poverty line annually (or
at any shorter interval the Secretary deems feasible and desir-
able) which shall be used as a criterion of eligibility in commu-
nity service block grant programs. The required revision shall be
accomplished by multiplying the official poverty line by the
percentage change in the Consumer Price Index during the
annual or other interval immediately preceding the time at
which the revision is made.
(3) The term "Secretary" means the Secretary of Health and
Human Services.
(4) The term "State" means each of the several States, the
District of Columbia, the Commonwealth of Puerto Rico, Guam,
the Virgin Islands, American Samoa, the Commonwealth of the
Northern Mariana Islands, and the Trust Territory of the Pacific
Islands.
STATE ALLOCATIONS
42 use 9903. SEC. 674. (aXD The Secretary shallfi*omthe amount appropriated
under section 672 for each fiscal year which remains after—
(A) the Secretary makes the apportionment required in subsec-
tion (bXD; and
(B) the Secretary determines the amount necessary for the
purposes of section 681(b);
allot to each State an amount which bears the same ratio to such
remaining amount as the amount received by the State for fiscal year
42 use 2808. 1981 under section 221 of the Economic Opportunity Act of 1964 bore
to the total amount received by all States for fiscal year 1981 under
such part, except that no State shall receive less than one quarter of 1
percent of the amount appropriated under section 672 for such fiscal
year.
(2) For purposes of this subsection, the term "State" does not
include Guam, American Samoa, the Virgin Islands, the Northern
Mariana Islands, and the Trust Territory of the Pacific Islands.
(b)(1) The Secretary shall apportion one-half of 1 percent of the
amount appropriated under section 672 for each fiscal year on the
basis of need among Guam, American Samoa, the Virgin Islands, the
Northern Mariana Islands, and the Trust Territory of the Pacific
Islands.
(2) Each jurisdiction to which paragraph (1) applies may receive
grants under this subtitle upon an application submitted to the
Secretary containing provisions which describe the programs for
which assistance is sought under this subtitle, and which are consist-
ent with the requirements of section 675.
(cXD If, with respect to any State, the Secretary—
(A) receives a request from the governing body of an Indian
tribe or tribal organization within the State that assistance
under this subtitle be made directly to such tribe or organization;
and
PUBUC LAW 97-88—AUG. 13,1981 95 STAT. 513
(B) determines that the members of such tribe or tribal
organization would be better served by means of grants made
directly to provide benefits under this subtitle;
the Secretary shall reserve from amounts which would otherwise be
allotted to such State under this subtitle for the fiscal year the
amount determined under paragraph (2).
(2) The Secretary shall reserve for the purpose of paragraph (1)
from sums that would otherwise be allotted to such State not less
than 100 percent of an amount which bears the same ratio to the
State's allotment for the fiscal year involved as the population of all
eligible Indians for whom a determination under this paragraph has
been made bears to the poi)ulation of all individuals eugible for
assistance under this subtitle in such State.
(3) The sums reserved by the Secretary on the basis of a determina-
tion under this subsection shall be granted to the Indian tribe or
tribal organization serving the individuals for whom such a determi-
nation has been made.
(4) In order for an Indian tribe or tribal organization to be eligible
for an awsurd for a fiscal year under this subsection, it shall submit to
the Secretary a plan for such fiscal year which meets such criteria as
the Secretary may prescribe bv r^iuation.
(5) The terms Indian tribe and "tribal organization" mean those "Indian tribe,"
tribes, bands, or other organized groups of Indians recognized in the ^ wfon "
State in which they reside or considered by the Secretary of the ^^
Interior to be an Indian tribe or an Indian organization for any
purpose.
APPUCATIONS AND REQUIREMENTS
SEC. 675. (a) Each State desiring to receive an allotment for a fiscal 42 use 9904.
year under this subtitle shall submit an appUcation to the Secretary.
Each such application shall be in such form as the Secretary shsul
require. Each such application shall contain assurances by the chief
executive ofQcer of the State that the State will comply with subsec-
tion (b) and will meet the conditions enumerated in subsection (c).
(b) After the expiration of the first fiscal year in which a State
received funds under this subtitle, no funds shall be allotted to such
State for any fiscal year under this subtitle unless the legislature of
the State conducts public hearings on the proposed use and distribu-
tion of funds to be provided under this subtitle for such fiscal year.
(c) As part of the annual application required by subsection (a]!, the
chief executive officer of each State shall certify that the State agrees
to—
(1) use the funds available under this subtitle—
(A) to provide a range of services and activities having a
measurable and potentially major impact on causes of pov-
erty in the community or those areas of the community
where poverty is a particularly acute problem;
(B) to provide activities designed to assist low-income
participants including the elderly poor—
(i) to secure and retain meaningful employment;
(ii) to attain an adequate education;
(iii) to make better use of available income;
(iv) to obtain and maintain adequate housing and a
suitable living environment;
(v) to obtain emergency assistance through loans or
grants to meet immediate and urgent individual and
family needs, including the need for health services,
95 STAT. 514 PUBLIC LAW 97-35—AUG. 13, 1981
nutritious food, housing, and employment-related
assistance;
(vi) to remove obstacles and solve problems which
block the achievement of self-sufficiency;
(vii) to achieve greater participation in the affairs of
the communitv; and
(viii) to make more effective use of other programs
related to the purposes of this subtitle;
(C) to provide on an emergency basis for the provision of
such supplies and services, nutritious foodstuffs, and related
services, as may be necessary to counteract conditions of
starvation and malnutrition among the poor;
(D) to coordinate and establish linkages between govern-
mental and other social services programs to assure the
effective delivery of such services to low-income individuals;
and
(E) to encourage the use of entities in the private sector of
the community in efforts to ameliorate poverty in the
community;
(2)(A)(i) use, for fiscal year 1982 only, not less than 90 percent of
the funds allotted to the State under section 674 to make grants
to use for the purposes described in clause (1) to eligible entities
(as defined in section 673(1)) or to organizations serving seasonal
or migrant farmworkers; and
(ii) use, for fiscal year 1983 and for each subsequent fiscal year,
not less than 90 percent of the funds allotted to the State under
section 674 to make grants to political subdivisions of the State
for the political subdivisions to use for the purposes described in
clause (1) directly or to nonprofit private community organiza-
tions which have a board which meets the requirements of clause
(3), or to migrant and seasonal farm worker organizations; and
(B) provide assurances that the State will not expend more
than 5 percent of its allotment under section 674 for administra-
tive expenses at the State level;
(3) provide assurances that, in the case of a community action
agency or nonprofit private organization, each board will be
constituted so as to assure that (A) one-third of the members of
the board are elected public officials, currently holding office, or
their representatives, except that if the number of elected
officials reasonably available and willing to serve is less than
one-third of the membership of the board, membership on the
board of appointive public officials may be counted in meeting
such one-third requirement; (B) at least one-third of the members
are persons chosen in accordance with democratic selection
procedures adequate to assure that they are representative of the
poor in the area served; and (C) the remainder of the members
are officials or members of business, industry, labor, religious,
welfare, education, or other msgor groups and interests in the
community;
(4) give special consideration in the designation of local com-
munity action agencies under this subtitle to any community
action agency which is receiving funds under any Federal antipo-
verty program on the date of the enactment of this Act, except
that (A) the State shall, before giving such special consideration,
determine that the agency involved meets program and fiscal
requirements established by the State; and (B) if there is no such
agency because of any change in the assistance furnished to
programs for economically disadvantaged persons, the State
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 515
shall give special consideration in the designation of community
action agencies to any successor agency which is operated in
substantially the same manner as the predecessor agency which
did receive funds in the fiscal year preceding the fiscal year for
which the determination is made;
(5) provide assurances that the State may transfer funds, but
not to exceed 5 percent of its allotment under section 674, for the
provisions set forth in this subtitle to services under the Older
Americans Act of 1965, the Head Start program under sub- 42USC300i
chapter B of chapter 8 of subtitle A of this title, or the energy ^o^-
crisis intervention program under title XXVI of this Act (relat- of'^QQ^'
mg to low-mcome home energy assistance);
(6) prohibit any political activities in accordance with subsec-
tion (e);
(7) prohibit any activities to provide voters and prospective
voters with transportation to the polls or provide similar assist-
ance in connection with an election or any voter registration
activity;
(8) provide for coordination between antipoverty programs in
each community, where appropriate, with emergency energy
crisis intervention programs under title XXVI of this Act (relat-
ing to low-income home energy assistance) conducted in such
community;
(9) provide that fiscal control and fund accounting procedures
will be established as may be necessary to assure the proper
disbursal of and accounting for Federal funds paid to the State
under this subtitle, including procedures for monitoring the
assistance provided under this subtitle, and provide that at legist
every year each State shall prepare, in accordance with subsec-
tion (f), an audit of its expenditures of amounts received under
this subtitle and amounts transferred to carry out the purposes
of this subtitle; and
(10) permit and cooperate with Federal investigations under-
taken in accordance with section 679.
The Secretary may not prescribe the manner in which the States will
comply with the provisions of this subsection.
(d)(1) In addition to the requirements of subsection (c), the chief
executive officer of each State shall prepare and furnish to the
Secretary a plan which contains provisions describing how the State
will carry out the assurances contained in subsection (c). The chief
executive officer of each State may revise any plan prepared under
this paragraph and shall furnish the revised plan to the Secretary.
(2) Each plan prepared under paragraph (1) shall be made available
for public inspection within the State in such a mgmner as will
facilitate review of, and comment on, the plan.
(e) For purposes of chapter 15 of title 5, United States Code, any 5 use i50i et
nonprofit private organization receiving assistance under this subti- *^9-
tie which has responsibility for planning, developing, and coordinat-
ing community antipoverty programs shall be deemed to be a State or
local agency. For purposes of clauses (1) and (2) of section 1502(a) of
such title, any such organization receiving assistance under this 5 use 1502.
subtitle shall l>ie deemed to be a State or local agency.
(f) Each audit required by subsection (c)(9) shall be conducted by an
entity independent of any agency administering activities or services
carried out under this subtitle and shall be conducted in accordance
with genereilly accepted accounting principles. Within 30 days after
the completion of each audit, the chief executive officer of the State
95 STAT. 516 PUBLIC LAW 97-35—AUG. 13, 1981
shall submit a copy of such audit to the legislature of the State and to
the Secretary.
(g) The State shall repay to the United States amounts found not to
have been expended in accordance with this subtitle or the Secretary
may offset such amounts against any other amount to which the
State is or may become entitled under this subtitle.
(h) The Comptroller General of the United States shall, from time
to time, evaluate the expenditures by States of grants under this
subtitle in order to assure that expenditures are consistent with the
provisions of this subtitle and to determine the effectiveness of the
State in accomplishing the purposes of this subtitle.
ADMINISTRATION
Office of SEC. 676. (a) There is established in the Department of Health and
Community Human Services an Office of Community Services. The Office shall be
Services.
Establishment. headed by a Director.
42 u s e 9905. (b) The Secretary shall carry out his functions under this subtitle
through the Office of Community Services established in subsection
(a).
NONDISCRIMINATION PROVISIONS
42 u s e 9906. SEC. 677. (a) No person shall on the ground of race, color, national
origin, or sex be excluded from participation in, be denied the benefits
of, or be subjected to discrimination under, any program or activity
funded in whole or in part with funds made available under this
subtitle. Any prohibition against discrimination on the basis of age
42 u s e 6101 under the Age Discrimination Act of 1975 or with respect to an
note. otherwise qualified handicapped individual as provided in section 504
29 u s e 794. of the Rehabilitation Act of 1973 shall also apply to any such program
or activity.
Ot>) Whenever the Secretary determines that a State that has
received a payment under this subtitle has failed to comply with
subsection (a) or an applicable regulation, he shall notify the chief
executive officer of the State and shall request him to secure
compliance. If within a reasonable period of time, not to exceed 60
days, the chief executive officer fails or refuses to secure compliance,
the Secretary is authorized to (1) refer the matter to the Attorney
General with a recommendation that an appropriate civil action be
instituted; (2) exercise the powers and functions provided by title VI
42 u s e 2000d. of the Civil Rights Act of 1964, the Age Discrimination Act of 1975, or
section 504 of the Rehabilitation Act of 1973, as may be applicable; or
(3) take such other action as may be provided by law.
(c) When a matter is referred to the Attorney General pursuant to
subsection (b), or whenever he has reason to believe that the State is
engaged in a pattern or practice in violation of the provisions of this
section, the Attorney General may bring a civil action in any
appropriate United States district court for such relief as may be
appropriate, including injunctive relief.
PAYMENTS TO STATES
42 use 9907. SEC. 678. (a) From its allotment under section 674, the Secretary
shall make payments to each State in accordance with section 203 of
the Intergovernmental Cooperation Act of 1968 (42 U.S.C. 4213), for
use under this subtitle.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 517
(b) Pa5maents to a State from its allotment for any fiscal year shall
be expended by the State in such fiscal year or in the succeeding fiscal
year.
WITHHOLDING
SEC. 679. (aXD The Secretary shall, eifter adequate notice and an Notice and
opportunity for a hearing conducted within the affected State, hearing.
withhold funds from any State which does not utilize its allotment 42 u s e 9908.
substantially in accordance with the provisions of this subtitle and
the assurances such State provided under section 675.
(2) The Secretary shall respond in an expeditious and speedy
manner to complaints of a substantial or serious nature that a State
has failed to use funds in accordcmce with the provisions of this
subtitle or the assurances provided by the State under section 675.
For purposes of this paragraph, a violation of any one of the
assurances contained in section 675(c) that constitutes a disregard of
that assurance shall be considered a serious complaint.
(b)(1) The Secretary shall conduct in several States in each fiscal investigations.
year investigations of the use of funds received by the States under
this subtitle in order to evaluate compliance with the provisions of
this subtitle.
(2) Whenever the Secretary determines that there is a pattern of
complaints from any State in any fiscal year, he shall conduct an
investigation of the use of funds received under this subtitle by such
State in order to ensure compliance with the provisions of this
subtitle.
(3) The Comptroller General of the United States may conduct an
investigation of the use of funds received under this subtitle by a
State in order to ensure compliance with the provisions of this
subtitle.
(c) Pursuant to an investigation conducted under subsection (b), a
State shall make appropriate books, documents, papers, and records
available to the Secretary or the Comptroller General of the United
States, or any of their duly authorized representatives, for examina-
tion, copying, or mechanical reproduction on or off the premises of
the appropriate entity upon a reasonable request therefor.
(d) In conducting any investigation under subsection (b), the Secre-
tary may not request any information not readily available to such
State or require that any information be compiled, collected, or
transmitted in any new form not already available.
UMITATION ON USE OF GRANTS FOR CONSTRUCTION
SEC. 680. (a) Except as provided in subsection (b), grants made 42 use 9909.
under this subtitle (other than amounts made available under section
681(b)) may not be used by the State, or by any other person with
which the State makes arrangements to carry out the purposes of this
subtitle, for the purchase or improvement of land, or the purchase,
construction, or permanent improvement (other than low-cost resi-
dential weatherization or other energy-related home repairs) of any
building or other facility.
(b) The Secretary may waive the limitation contained in subsection
(a) upon the State's request for such a waiver if he finds that the
request describes extraordinary circumstances to justify the pur-
chase of land or the construction of facilities (or the making of
permanent improvements) and that permitting the waiver will con-
tribute to the State's ability to carry out the purposes of this subtitle.
95 STAT. 518 PUBLIC LAW 97-35—AUG. 13, 1981
DISCRETIONARY AUTHORITY OF SECRETARY
42 use 9910. SEC. 681. (a) The Secretary is authorized, either directly or through
grants, loans, or ^arantees to States and public and other organiza-
tions and agencies, or contracts or jointly financed cooperative
arrangements with States and public and other organizations and
agencies, to provide for—
(1) training related to the purposes of this subtitle; and
(2) ongoing activities of national or regional significance re-
lated to the purposes of this subtitle, including special emphasis
programs for—
(A) special programs of assistance to private, locally initi-
ated communit3r development programs which sponsor en-
terprises providing emplo3mient and business development
opportunities for low-income residents of the area;
(B) Rural Development Loan Fund revolving loans and
guarantees under subchapter A of chapter 8 of subtitle A of
this title;
(C) community development credit union programs admin-
istered under subchapter A of chapter 8 of subtitle A of this
Ante, p. 489. title;
(D) technical assistance and training programs in rural
housing and community facilities development;
(E) assistance for migrants and seasonal farmworkers; and
(F) national or regional programs designed to provide
recreational activities for low-income youth.
(b) Of the amounts appropriated under section 672(b) for any fiscal
year, not more than 9 percent of such amounts shall be available to
the Secretary for purposes of carr3ang out this section and subchapter
A of chapter 8 of subtitle A of this title.
TRANSITION PROVISIONS
42 use 9911. SEC. 682. (a)(1) The purpose of this section is to permit, for fiscal
year 1982 only, States to choose to operate programs under the block
grant established by this subtitle or to have the Secretary operate
programs under the provisions of law repealed by section 683(a).
(2) The Secretary shall carry out the provisions of this section
through the Office of Community Services established in section
676(a).
(b)(1) Notwithstanding the provisions of section 683(a) or any other
provision of law, a State may, for fiscal year 1982 only, make a
determination that the State chooses not to operate programs under
the block grant established by this subtitle. If the State makes such a
determination, the State's allotment under section 674 shall be used
within the State by the Secretary to carry out programs (in accord-
ance with paragraph (4)) under the provisions of law in effect on
September 30,1981, but repealed by section 683(a).
(2) The provisions of paragraph (1) apply to the provisions of law
referred to in such paragraph, regardless of whether there is a
specific termination provision or other provision of law repealing or
otherwise terminating any program subject to this Act.
(3) Each State which, pursuant to paragraph (1), determines to have
the Secretary operate programs under the provisions of law in effect
on September 30, 1981, but repealed by section 683(a), shall give
notice to the Secretary of such determination. Such notice shall be
submitted to the Secretary prior to the beginning of the first quarter
of fiscal year 1982 and at least 30 days before the beginning of any
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 519
other quarter during such fiscal year. For purposes of this section, the
quarters for fiscal year 1982 shall commence on October 1, January 1,
April 1, and July 1 of fiscal year 1982.
(4) In any case in which the Secretary carries out programs under
paragraph (1), the Secretary shall provide for the carrying out of such
programs by making grants for such purpose to eligible entities (as
defined in section 673(1)).
(c) The Secretary shall provide such assistemce to the States as the
States may require in order to carry out the provisions of this section.
(d) The Secretary may reserve not more than 5 percent of any
State's allotment for administration of such State's programs under
the block grant established by this subtitle, if such State has made a
determination that the State chooses not to operate programs under
the block grant established by this subtitle, and the Secretary is
carrying out such State's programs under the provisions of law in
effect on September 30,1981.
(e) Upon the enactment of this Act, the Director of the Office of
Management and Budget is authorized to provide for termination of
the affairs of the C!ommunity Services Administration. He shall
provide for the transfer or other disposition of personnel, assets,
liabilities, grants, contracts, property, records, and unexpended bal-
ances of appropriations, authorizations, allocations, and other funds
held, used, arising from, available to, or to be made available in
connection with implementation of the authorities terminated by
section 683(a) as necessary to effectuate the purposes of this subtitle.
REPEALER; REAUTHORIZATION PROVISIONS; TECHNICAL AND
CONFORMING PROVISIONS
SEC. 683. (a) Effective October 1, 1981, the Economic Opportunity 42 u s e 9912.
Act of 1964, other than titles VIII and X of such Act, is repealed. Repeal.
(b) There is authorized to be appropriated such sums as may be 42 u s e 2701.
necessary for each of the fiscal years 1982,1983, and 1984, to carry out
title VIII of the Economic Opportunity Act of 1964. 42 use 2991.
(c)(1) Any reference in any provision of law to the poverty line set
forth in section 624 of the Economic Opportunity Act of 1964 shall be 42 use 297ic.
construed to be a reference to the poverty line defined in section
673(2) of this Act.
(2) Any reference in any provision of law to any community action
agency designated under title II of the Economic Opportunity Act of
1964 shall be construed to be a reference to private nonprofit
community organizations eligible to receive funds under this subtitle.
(3) No action or other proceeding commenced by or against any
officer in the official capacity of such individual as an officer of any
agency administering the Act repealed by subsection (a) of this
section shall abate by reason of the enactment of this Act.
TITLE VII—EMPLOYMENT PROGRAMS
COMPREHENSIVE EMPLOYMENT AND TRAINING ACT
SEC. 701. (a) Section 112 of the Comprehensive Employment and
Training Act is amended to read as follows: 29 u s e 822.
" A U T H O R I Z A T I O N O F APPROPRIATIONS
"SEC. 112. (a) There are authorized to be appropriated for fiscal
year 1982 for the purpose of carrying out this Act—
-194 O—82 35:QL3
95 STAT. 520 PUBLIC LAW 97-35—AUG. 13, 1981
29 use 841, 846, "(1) $1,430,775,000 for carrying out parts A, B, and C of title 11;
852 "(2) $219,015,000 for carrying out titles III and V, of which not
29 use 871,891. jj^^j.^ ^j^g^^ ^3 million may be transferred to the National Occupa-
tional Information Coordinating Committee established pursu-
ant to section 161(b) of the Vocational Education Act of 1963 for
purposes described in section 315 of this Act;
29 use 893. "(3) $576,200,000 for carrying out part A of title IV;
29 use 923. "(4) $628,263,000 for carrying out part B of title IV;
29 use 942. "(5) $766,100,000 for carrying out part C of title IV;
29 use 981. "(6) $274,700,000 for carrying out title VII; and
"(7) $75,462,000 for the expenses of the Department of Labor in
administering this Act.
"(bXD For the purpose of affording adequate notice of funding
available under this Act, appropriations under this Act are author-
ized to be included in an appropriation Act for the fiscal year
preceding the fiscal year for which they are first available for
obligation.
"(2) In order to effect a transition to the advance funding method of
timing appropriation action, the provisions of this subsection shall
apply notwithstanding that its initial application will result in the
enactment in the same year (whether in the same appropriation Act
or otherwise) of two separate appropriations, one for the then current
fiscal year and one for the succeeding fiscal year.".
29 use 842. (b) The matter preceding clause (i) of section 202(aX2XA) of the Act
is amended by striking out "Eighty-five percent" and inserting in lieu
thereof "Eighty-six and one-half percent".
(c) Section 202 of the Comprehensive Employment and Training
Act is amended by adding the following subsection at the end thereof:
"(h) Notwithsteinding the provisions of subsections (b), (c), (d), and
(e) of this section, not more than 10 y2 percent of the amounts
available for this title shall be available for the purposes specified in
such subsections. The Governor of each State may in his own
discretion determine the amount of funds to be used for each of the
functions specified in such subsections but not to exceed the amounts
29 use 909. (dXD Section '433(aXl) of the Comprehensive Employment and
Training Act is amended by striking out "75" and inserting in lieu
thereof ^85".
29 use 912. (2) Section 436(aX2) of such Act is amended by striking out ", but
services to youth under that title shall not be reduced because of the
availability of financial assistance under this subpart".
(eXD Title IV of the Comprehensive Employment and Training Act
is amended by inserting after section 402 the following new section:
"TRANSFERABILITY OF FUNDS
29 use 892a. "SEC. 403. (a) Twenty p r c e n t of the funds available to a prime
29 use 893. sponsor in fiscal year 1982 to carry out part A of this title may, at the
prime sponsor's discretion, be used in accordance with the provisions
29 use 942. of part C and 20 percent of the funds available to a prime sponsor in
fiscal year 1982 to carry out part C of this title may, at the prime
sponsor's discretion, be used in accordance with the provisions of part
A.
"(b) Funds available to a prime sponsor under subpart 2 of part A of
29 use 899. this title may, at the prime sponsor's discretion, be used in accord-
ance with the provisions of subpart 3 of part A of this title. Any funds
allocated under subpart 2 of part A of this title which are reallocated
29 use 818. by the Secretary pursuant to section 108 may, in the Secretary's
PUBLIC LAW 97-35—AUG. 13,1981 95 STAT. 521
discretion, be allocated for use in accordance with the provisions of
subpart 3 of part A of this title.". 29 use 907.
(2) The table of contents of such Act is amended by inserting after
the item pertaining to section 402 the following new item:
"403. Transferability of funds.".
(f) Section 702 of the Comprehensive Employment and Training Act 29 use 982.
is amended—
(1) by striking out "Eighty-five" in subsection (bXD and insert-
ing in lieu thereof "Ninety-five"; and
(2) by striking out paragraph (2) and inserting in lieu thereof
the following:
"(2) Funds available to prime sponsors under this title may be used
to promote coordination with economic development activities sup-
ported by Federal, State, or local funds. Funds used for such coordi-
nated activities shall not be taken into account in the computation of
cost per participant or cost per placement for purposes of program
evaluation.".
(g) If, during the second session of the 97th Congress, neither the 29 use 822 note.
House of Representatives nor the Senate have passed legislation
replacing or amending the Comprehensive Emplo3mient and Train-
ing Act by September 10, 1982, the provisions of section 112 of that
Act (relating to authorization of appropriations) applicable to fiscal ^f^te, p. 519.
1982 shall be applicable tofiscal1983.
THE WAGNER-PEYSER ACT
SEC. 702. Section 5(b) of the Act of June 6,1933 (commonly known
as the Wagner-Peyser Act), is amended by inserting before the period 29 use 49d.
at the end thereof a comma and the following: %ut not to exceed
$677,800,000 in the fiscal year beginning October 1, 1981. For pur-
poses of this subsection, the term 'proper and efficient administration
of its public employment offices' sh^dl mean only such functions as
are necessary to carry out the provisions of this Act and shall not
include functions authorized or required under the Internal Revenue
Code of 1954, the Immigration and Nationality Act, or chapter 41 of 26 use l et seq.;
title 38, United States Code.". 8 use uoi et
38 u s e 2001 et
TITLE VIII—SCHOOL LUNCH AND CHILD seq.
NUTRITION PROGRAMS
CHANGES IN REIMBURSEMENT FOR SCHOOL LUNCHES AND BREAKFASTS
SEC. 801. (a) Section 4 of the National School Lunch Act is 42 use 1753.
amended—
(1) by inserting "(a)" after "SEC. 4.";
(2) in subsection (a) (as so designated), by striking out the
second sentence; and
(3) by adding at the end thereof the following new subsection:
"Ot>Xl) The Secretary shall make food assistance pajnnents to each
State educational agency each fiscal year, at such times as the
Secretarj^ may determine, from the sums appropriated for such
purpose, m a total amount equal to the product obtained by multi-
plying—
"(A) the number of lunches (consisting of a combination of
foods which meet the minimum nutritional requirements pre-
scribed by the Secretsiry under section 9(a) of this Act) served
95 STAT. 522 PUBLIC LAW 97-35—AUG. 13, 1981
during such fiscal year in schools in such State which participate
in the school lunch program under this Act under agreements
with such State educational agency; by
"(B) the national average lunch pa5mient prescribed in para-
graph (2) of this subsection.
"(2) The national average lunch payment for each lunch served
shall be 10.5 cents (as adjusted pursuant to section 11(a) of this Act)
except that for each lunch served in school food authorities in which
60 percent or more of the lunches served in the school lunch program
during the second preceding school year were served free or at a
reduced-price, the national average lunch pajnnent shall be 2 cents
more.".
42 use 1759a. (b) Section 11(a) of the National School Lunch Act is amended—
(1) by inserting "(1)" after "SEC. 11. (a)";
(2) in the third sentence, by striking out "(1)" and inserting in
lieu thereof "(A)" and by striking out "(2)" and inserting in lieu
thereof "(B)"; and
(8) by striking out the fifth sentence and all that follows
through the end of the subsection and inserting in lieu thereof
the following:
"(2) The special-assistance factor prescribed by the Secretary for
free lunches shall be 98.75 cents and the special-assistance factor
for reduced-price lunches shall be 40 cents less than the special-
assistance factor for free lunches.
"(3)(A) The Secretary shall prescribe on July 1, 1982, and on each
subsequent July 1, an annual adjustment in the following:
"(i) The national average payment rates for lunches (as estab-
Ante, p. 521. lished Under section 4 of this Act).
"(ii) The special assistance factor for lunches (as established
under paragraph (2) of this subsection).
"(iii) The national average payment rates for breakfasts (as
^"/^- established under section 4(b) of the Child Nutrition Act of 1966).
"(iv) The national average pa5nnent rates for supplements (as
Post, p. 528. established under section 17(c) of this Act).
"(B) The annual adjustment under this paragraph shall reflect
changes in the cost of operating meal programs under this Act and
the Child Nutrition Act of 1966, as indicated by the change in the
series for food away from home of the Consumer Price Index for all
Urban Consumers, published by the Bureau of Labor Statistics of the
Department of Labor. Each annual adjustment shall reflect the
changes in the series for food away from home for the most recent
12-month period for which such data are available. The adjustments
made under this paragraph shall be computed to the nearest one-
fourth cent.".
42 use 1773. (c)(1) Section 4(b)(1) of the Child Nutrition Act of 1966 is amended to
read as follows:
"(b)(lXA) The Secretary shall make breakfast assistance payments
to each State educational agency each fiscal year, at such times as the
Secretary may determine, from the sums appropriated for such
purpose, in an amount equal to the product obtained by multi-
plying—
"(i) the number of breakfasts served during such fiscal year to
children in schools in such States which participate in the school
breakfast program under agreements with such State educa-
tional Eigency; by
"(ii) the national average breakfast payment for free break-
fasts, for reduced-price breakfasts, or for breakfasts served to
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 523
children not eligible for free or reduced-price meals, as appropri-
ate, as prescribed in clause (B) of this paragraph.
"(B) The national average payment for each free breakfast shall be
57 cents (as adjusted pursuant to section 11(a) of the National School
Lunch Act), TTie national average payment for each reduced-price Ante, p. 522.
breakfast shall be one-half of the nationsd average payment for each
free breakfast, adjusted to the nearest one-fourth cent, except that in
no case shall the difference between the amount of the national
average pajmaent for a free breaWast and the national average
pajnnent for a reduced-price breakfast exceed 30 cents. The national
average payment for each breakfast served to a child not eligible for
free or reduced-price meals shall be 8.25 cents (as adjusted pursuant
to section 11(a) of the National School Lunch Act).
"(C) No school which receives breakfast assistance pa5mients under
this section may charge a price of more than 30 cents for a reduced-
price breakfast.
"(D) No breakfast assistance payment may be made under this
subsection for any breakfast served by a school unless such breakfast
consists of a combination of foods which meet the minimum nutri-
tional requirements prescribed by the Secretary under subsection (e)
of this section.".
(2) Section 4(bX2) of the Child Nutrition Act of 1966 is amended— Ante, p. 522.
(A) in clause (B)(ii)—
(i) by striking out "on a semiannual basis each July 1 and
January 1" and inserting in lieu thereof "on an annual basis
each July 1"; and
(ii) by striking out "six-month" and inserting in lieu
thereof "twelve-month"; and
(B) in clause (C), by striking out "five" and inserting in lieu
thereof "thirty".
(3)(A) Section 4(d) of the Child Nutrition Act of 1966 is amended to 42 use 1773.
read £is follows:
"(d)(1) Each State educational agency shall provide additional
assistance to schools in severe need, which shall include only—
"(A) those schools in which the service of breakfasts is required
pursuant to State law; and
"(B) those schools (having a breakfast program or desiring to
initiate a breakfast program) in which, during the most recent
second preceding school year for which lunches were served, 40
percent or more of the lunches served to students at the school
were served free or at a reduced-price, and in which the rate per
meal established by the Secretary is insufficient to cover the
costs of the breakfast program.
The provision of eligibility specified in clause (A) of this paragraph
shall terminate effective July 1,1983, for schools in States where the
State legislatures meet annually and shall terminate effective
July 1, 1984, for schools in States where the State legislatures meet
biennially.
"(2) A school, upon the submission of appropriate documentation
about the need circumstances in that school and the school's eligibil-
ity for additional assistance, shall be entitled to receive 100 percent of
the operating costs of the breakfast program, including the costs of
obtaining, preparing, and serving food, or the meal reimbursement
rate specified in paragraph (2) of section 4(b) of this Act, whichever is
less.".
95 STAT. 524 PUBLIC LAW 97-35—AUG. 13, 1981
REDUCTION IN COMMODITY ASSISTANCE FOR LUNCHES
SEC. 802. The first sentence of section 6(e) of the National School
42 use 1755. Lunch Act is amended to read as follows: "The national average value
of donated foods, or cash payments in lieu thereof, shall be 11 cents,
adjusted on July 1,1982, and each July 1 thereafter to reflect changes
in the Price Index for Food Used in Schools and Institutions.".
REVISION OF INCOME EUGIBILITY GUIDEUNES
42 use 1758. SEC. 803. (a) Section 9(b) of the National School Lunch Act is
amended—
(1) by amending paragraph (1) to read as follows:
"(IXA) Not later than June 1 of each fiscal year, the Secretary shall
prescribe income guidelines for determining eligibility for free and
reduced-price lunches during the 12-month period beginning July 1 of
such fiscal year and ending June 30 of the following flscal year. For
the school years ending June 30,1982, and June 30,1983, the income
guidelines for determining eligibility for free lunches shall be 130
percent of the applicable family-size income levels contained in the
nonfarm income poverty guidelines prescribed by the Office of
Management and Budget, as adjusted annually in accordance with
subparagraph (B). Beginning July 1,1983, the income guidelines for
determining eligibilit)^ for free lunches for any school year shall be
the same as the gross income eligibility standards announced by the
Secretary for any such period for eligibility for participation in the
7 use 2011 note, food Stamp program under the Food Stamp Act of 1977. The income
guidelines for determining eligibility for reduced-price lunches for
any school year shall be 185 percent of the applicable family-size
income levels contained in the nonfarm income poverty guidelines
prescribed by the Office of Management and Budget, as adjusted
annually in accordance with subparagraph (B). The Office of Manage-
ment and Budget guidelines shall be revised at annual intervals, or at
any shorter interval deemed feasible and desirable.
"(B) The revision required by subparagraph (A) of this paragraph
shall be made by multiplying—
"(i) the official poverty line (as defined by the Office of
Management and Budget); by
"(ii) the percentage change in the Consumer Price Index
during the einnual or other interval immediately preceding the
time at which the adjustment is made.
Revisions under this subparagraph shall be made not more than 30
days after the date on which the consumer price index data required
to compute the adjustment becomes available.";
(2) by redesignating paragraph (2) (and any references thereto)
as paragraph (5) and by inserting after paragraph (1) the follow-
ing new paragraphs:
"(2)(A) Following the determination by the Secretary under para-
graph (1) of this subsection of the income eligibility guidelines for
each school year, each State educational agency shall announce the
income eligibility guidelines, by family-size, to be used by schools in
the State in making determinations of eligibility for free and reduced-
price lunches. Local school authorities shall, each year, publicly
announce the income eligibility guidelines for free and reduced-price
lunches on or before the opening of school.
"(B) Applications for free and reduced-price lunches, in such form
as the Secretary may prescribe or approve, and any descriptive
material, shall be distributed to the parents or guardians of children
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 525
in attendance at the school, and shall contain only the family-size
income levels for reduced-price meal eligibility with the explanation
that households with incomes less than or equal to these values would
be eligible for free or reduced-price lunches. Such forms and descrip-
tive material may not contain the income eligibility guidelines for
free lunches.
"(C) Eligibility determinations shall be made on the basis of a
complete application executed by an adult member of the household.
The Secretary, States, and local school food authorities may seek
verification of the data contained in the application. Local school food
authorities shall undertake such verification of the information
contained in these applications as the Secretary may by regulation
prescribe and, in accordance with such regulations, make appro-
priate changes in the eligibility determinations on the basis of such
verification.
"(3) Any child who is a member of a household whose income, at the
time the application is submitted, is at an annual rate which does not
exceed the applicable family-size income level of the income eligibil-
ity guidelines for free lunches, as determined under paragraph (1),
shall be served a free lunch. Any child who is a member of a
household whose income, at the time the application is submitted, is
at an annual rate greater than the applicable family-size income level
of the income eligibility guidelines for free lunches, as determined
under paragraph (1), but less than or equal to the applicable family-
size income level of the income eligibility guidelines for reduced-price
lunches, as determined under paragraph (1), shall be served a
reduced-price lunch. The price charged for a reduced-price lunch
shall not exceed 40 cents.
"(4) No physical segregation of or other discrimination against any
child eligible for a free lunch or a reduced-price lunch under this
subsection shall be made by the school nor shall there by any overt
identification of any child by special tokens or tickets, announced or
published lists of names, or by other means."; and
(3) in the second sentence of paragraph (5), as so redesignated
by paragraph (2) of this subsection, by striking out "solely".
(b) Section 9 of the National School Lunch Act is further amended 42 use 1758.
by adding at the end thereof the following new subsection:
"(d)(1) The Secretary shall require as a condition of eligibility for
receipt of free or reduced-price lunches that the member of the
household who executes the application furnish the social security
account numbers of all adult members of the household of which such
person is a member.
"(2) No member of a household may be provided a free or reduced-
price lunch under this Act unless—
"(A) appropriate documentation, as prescribed by the Secre-
tary, of the income of such household has been provided to the
appropriate local school food authority; or
(B) documentation showing that the household is participat-
ing in the food stamp program under the Food Stsimp Act of
1977 has been provided to the appropriate local school food
authority.".
(c) Notwithstanding any other provision of law, the Secretary of Study.
Agriculture shall conduct a pilot study to verify the data submitted l^^Y^ ^^^^
on a sample of applications for free and reduced-price meals. In note.
conducting the pilot study, the Secretary may require households
included in the study to furnish social security numbers of all
household members and such other information as the Secretary may
require, including, but not limited to, pay stubs, documentation of the
95 STAT. 526 PUBLIC LAW 97-35—AUG. 13, 1981
current status of household members who are recipients of public
assistance, unemplojmient insurance documents, and written state-
ments from employers, as a condition for receipt of free or reduced-
price meals.
42 use 1758 (d) For the school year ending June 30, 1982, the Secretary may
"°^- prescribe procedures for implementing the revisions made by the
amendments contained in this section to the income eligibility
guidelines for free and reduced-price lunches under section 9 of the
42 use 1758. National School Lunch Act. Such procedures may allow school food
authorities to (1) use applications distributed at the beginning of the
school year when making eligibility determinations based on the
revised income eligibility guidelines, or (2) distribute new applica-
tions and make determinations using such applications.
REVISION OF STATE REVENUE MATCHING REQUIREMENTS
42 use 1756. SEC. 804. Section 7 of the National School Lunch Act is amended to
read as follows:
42 use 1753. "SEC. 7. (aXD Funds appropriated to carry out section 4 of this Act
during any fiscal year shall be available for payment to the States for
disbursement by State educational agencies in accordance with such
agreements, not inconsistent with the provisions of this Act, as may
be entered into by the Secretary and such State educational agencies
for the purpose of assisting schools within the States in obtaining
agricultural commodities and other foods for consumption by chil-
dren in furtherance of the school lunch program authorized under
this Act. For any school year, such pajnnents shall be made to a State
only if, during such school year, the amount of the State revenues
(excluding State revenues derived from the operation of the program)
appropriated or used specifically for program purposes (other than
any State revenues expended for salaries and administrative ex-
penses of the program at the State level) is not less than 30 percent of
the funds made avsiilable to such State under section 4 of this Act for
the school year beginning July 1,1980.
"(2) If, for any school year, the per capita income of a State is less
than the average per capita income of all the States, the amount
required to be expended by a State under paragraph (1) for such year
shall be an amount bearing the same ratio to the amount equal to 30
percent of the funds made available to such State under section 4 of
this Act for the the school year beginning July 1, 1980, as the per
capita income of such State bears to the average per capita income of
all the States.
"(b) The State revenues provided by any State to meet the require-
ment of subsection (a) shall, to the extent the State deems practicable,
be disbursed to schools participating in the school lunch program
under this Act. No State in which the State educational agency is
prohibited by law from disbursing State appropriated funds to pri-
vate schools shall be required to match Federal funds made available
for meals served in such schools, or to disburse, to such schools, any of
the State revenues required to meet the requirements of subsection
(a).
"(c) The Secretary shall certify to the Secretary of the Treasury,
from time to time, the amounts to be paid to any State under this
section and shall specify when such payments are to be made. The
Secretary of the Treasury shall pay to the State, at the time or times
fixed by the Secretary, the amounts so certified.".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 527
TERMINATION OF FOOD SERVICE EQUIPBIENT ASSISTANCE
SEC. 805. (a) Section 5 of the National School Lunch Act is repealed. Repeals.
(b) Section 5 of the Child Nutrition Act of 1966 is repealed. ^^ use 1754.
42 u s e 1774.
NUTRITION EDUCATION AND TRAINING PROGRAM
SEC. 806. The second sentence of section 19(jX2) of the Child
Nutrition Act of 1966 is amended to read as follows: "There is 42 use 1788.
authorized to be appropriated for the grants referred to in the
preceding sentence not more than $15,000,000 for fiscal year 1981»
and not more than $5,000,000 for each subsequent fiscal year.".
REVISION OF THE SPECIAL MILK PROGRAM
SEC. 807. Section 3 of the Child Nutrition Act of 1966 is amended— 42 use 1772.
(1) in the first sentence—
(A) in clause (1), by inserting "which do not participate in a
mesJ service prc^ram authorized under this Act or the
National School Lunch Act," after "under,"; and 42 use I75i
(B) in clause (2), by inserting ", which do not participate in ^°^'
a meal service program authorized under this Act or the
National School Lunch Act" after "training of children";
(2) in the fourth sentence, by inserting "which does not
participate in a meal service prc^am authorized under this Act
or the National School Lunch Act" after "institution";
(3) in the fifth sentence, by striking out "also"; and
(4) by striking out the eighth sentence.
LIMITATION ON PRIVATE SCHOOL PARTICIPATION
SEC. 808. (a) Section 12(dX6) of the National School Lunch Act is 42 use 1760.
amended by inserting in the first sentence "except private schools
whose average yearly tuition exceeds $1,500 per child," after
"under,".
(b) Section 15(c) of the Child Nutrition Act of 1966 is amended by 42 use 1784.
inserting in the first sentence "except private schools whose average
yearly tuition exceeds $1,500 per child," after "such school,".
SUMMER FOOD SERVICE PROGRAM
SEC. 809. Section 13 of the National School Lunch Act is amended— 42 use I76i.
(1) in subsection (aXl)—
(A) in clause (B), by striking out "nonresidential public or
private nonprofit institutions," and inserting in lieu thereof
"public or private nonprofit school food authorities, local,
municipal, or county governments,"; and
(B) in clause (C), by striking out "33 Vs percent" and
inserting in lieu thereof "50 percent"; and
(2) by adding at the end of subsection (a) the following new
paragraph:
"(6) Service institutions that are local, municipal, or county govern-
ments shall be eligible for reimbursement for meals served in
programs under this section only if such programs are operated
directly by such governments.".
95 STAT. 528 PUBLIC LAW 97-35—AUG. 13, 1981
REVISION OF CHILD CARE FOOD PROGRAM
42 use 1766. SEC. 810. (a) Section 17(a) of the National School Lunch Act is
amended—
(1) in the second sentence, by adding at the end before the
period the following: "(but only if such organization receives
compensation under such title for at least 25 percent of the
children for which the organization provides such nonresidential
day care services)"; and
(2) by adding after the third sentence the following: "Reim-
bursement may be provided under this section only for meals or
supplements served to children not over 12 years of age (except
that such age limitation shall not be applicable for children of
migrant workers if 15 years of age or less or for handicapped
children).".
(b) Section 17(b) of the National School Lunch Act is amended by
striking out "served in the manner specified in subsection (c)" and
inserting in lieu thereof "as provided in subsection (f)".
(c) Section 17(c) of the National School Lunch Act is amended to
read as follows:
"(cXD For purposes of this section, the national average pa5anent
rate for free lunches and suppers, the national average pa5mient rate
for reduced-price lunches and suppers, and the national average
pajnnent rate for paid lunches and suppers shall be the same as the
national average pa3nnent rates for free lunches, reduced-price
lunches, and paid lunches, respectively, under sections 4 and 11 of
f2 use 1753, this Act as appropriate (as adjusted pursuant to section 11(a) of this
"^^^- Act).
"(2) For purposes of this section, the national average payment rate
for free breakfasts, the national average payment rate for reduced-
price breakfasts, and the national average paj^ment rate for paid
breakfasts shall be the same as the national average payment rates
for free breakfasts, reduced-price breakfasts, and paid breakfasts,
Ante, p. 522. respectively, under section 4(b) of the Child Nutrition Act of 1966 (as
adiusted pursuant to section 11(a) of this Act).
(3) For purposes of this section, the national average pajnnent rate
for free supplements shall be 30 cents, the national average payment
rate for reduced-price supplements shall be one-half the rate for free
supplements, and the national average pajnnent rate for paid supple-
ments shall be 2.75 cents (as adjusted pursuant to section 11(a) of this
Act).
"(4) Determinations with regard to eligibility for free and reduced-
price meals and supplements shall be made in accordance with the
income eligibility guidelines for free lunches and reduced-price
42 use 1758. lunches, respectively, under section 9 of this Act.".
(d) Section 17(f) of the National School Lunch Act is amended—
(1) by amending paragraph (2) to read as follows:
"(2)(A) Subject to subparagraph (B) of this paragraph, the disburse-
ment for any fiscal year to any State for disbursement to institutions,
other than family or group day care home sponsoring organizations,
for meals provided under this section shall be equal to the sum of the
products obtained by multiplying the total number of each type of
meal (breakfast, lunch or supper, or supplement) served in such
institution in that fiscal year by the applicable national average
payment rate for each such type of meal, as determined under
subsection (c).
"(B) No reimbursement may be made to any institution under this
paragraph, or to family or group day care home sponsoring organiza-
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 529
tions under paragraph (3) of this subsection, for more than two meals
and one supplement per day per child.";
(2) by striking out paragraph (3) and by redesignating para-
graphs (4) and (5) (and any references thereto) as paragraphs (3)
and (4), respectively; and
(3) in paragraph (3), as so redesignated—
(A) by redesignating the fourth sentence and all that
follows through the end of the paragraph as subparagraph
(C); and
(B) by amending all that precedes subparagraph (C) (as so
redesignated) to read as follows:
"(3)(A) Institutions that participate in the program under this
section as family or group day care home sponsoring organizations
shall be provided, for payment to such homes, a reimbursement
factor set by the Secretary for the cost of obtaining and preparing
food and prescribed labor costs, involved in providing meals under
this section, without a requirement for documentation of such costs,
except that reimbursement shall not be provided under this subpara-
graph for meals or supplements served to the children of a person
acting as a family or group day care home provider unless such
children meet the eligiblity standards for free or reduced-price meals
under section 9 of this Act. The reimbursement factor in effect as of
the date of the enactment of this sentence shall be reduced by 10
percent. The reimbursement factor under this subparagraph shall be
adjusted on July 1 of each year to reflect changes in the Consumer
Price Index for food away from home for the most recent 12-month
period for which such data are available. The reimbursement factor
under this subparagraph shall be rounded to the nearest one-fourth
cent.
"(B) Family or group day care home sponsoring organizations shall
also receive reimbursement for their administrative expenses in
amounts not exceeding the maximum allowable levels prescribed by
the Secretary. Such levels shall be adjusted July 1 of each year to
reflect changes in the Consumer Price Index for all items for the most
recent 12-month period for which such data are available. The
maximum allowable levels for administrative expense payments, as
in effect as of the date of the enactment of this subparagraph, shall be
adjusted by the Secretary so as to achieve a 10 percent reduction in
the total amount of reimbursement provided to institutions for such
administrative expenses. In making the reduction required by the
preceding sentence, the Secretary shall increase the economy of scale
factors used to distinguish institutions that sponsor a greater number
of family or group day care homes from those that sponsor a lesser
number of such homes.".
(e) Section 17(g) of the National School Lunch Act is amended by 42 use 1766.
striking out paragraph (2) and by redesignating paragraphs (3) and (4)
(and any references thereto) as paragraphs (2) and (3), respectively.
(f) Section 17 of the National School Lunch Act is further amended
by striking out subsections (i) and (n).
(g) Section 17(o) of the National School Lunch Act is amended in the
second sentence by striking out "the availability of food service
equipment funds under the program,".
FOOD NOT INTENDED TO BE CONSUMED
SEC. 811. The third sentence of section 9(a) of the National School
Lunch Act is amended by striking out "in any junior high school or 42 use 1758.
middle school".
95 STAT. 530 PUBLIC LAW 97-35—AUG. 13, 1981
STATE PLAN REQUIREMENTS
42 use 1759a. SEC. 812. Section 11(e) of the National School Lunch Act is
amended—
(1) by striking out paragraph (1) and redesignating paragraphs
(2) and (3) (and any references thereto) as paragraphs (1) and (2),
respectively; and
(2) in paragraphs (1) and (2), as so redesignated, by striking out
the second sentence of each such paragraph.
COMMODITY ONLY SCHOOLS
42 use 1762a. SEC. 813. (a) Section 14 of the National School Lunch Act is
amended by adding at the end thereof the following new subsection:
"(f) Commodity only schools shall be eligible to receive donated
commodities equal in value to the sum of the national average value
Ante, p. 524. of donated foods established under section 6(e) of this Act and the
42 use 1753. national average payment established under section 4 of this Act.
Such schools shall be eligible to receive up to 5 cents per meal of such
value in cash for processing and handling expenses related to the use
of such commodities. Lunches served in such schools shall consist of a
combination of foods which meet the minimum nutritional require-
ments prescribed by the Secretary under section 9(a) of this Act, and
shall represent the four basic food groups, including a serving of fluid
milk.".
42 use 1759a. (b) Section 11 of the National School Lunch Act is further amended
by adding at the end thereof the following new subsection:
"(f) Commodity only schools shall also be eligible for special-
assistance payments under this section. Such schools shall serve
meals free to children who meet the eligibility requirements for free
Ante, p. 524. meals under section 9(b) of this Act, and shall serve meals at a
reduced price, not exceeding the price specified in section 9(bX3) of
this Act, to children meeting the eligibility requirements for reduced-
price meals under such section. No physical segregation of, or other
discrimination against, any child eligible for a free or reduced-priced
lunch shall be made by the school, nor shall there be any overt
identification of any such child by any means.".
42 use 1772. (c) Section 3 of the Child Nutrition Act of 1968 is further amended
by-
(1) inserting "(a)" after "SEC. 3."; and
(2) by adding at the end thereof the following new subsection:
"(b) Commodity only schools shall not be eligible to participate in
the special milk program under this section. For the purposes of the
preceding sentence, the term 'commodity only schools' means schools
that do not participate in the school lunch program under the
National School Lunch Act, but which receive commodities made
available by the Secretary for use by such schools in nonprofit limch
programs.".
42 use 1760. (d) Section 12(d) of the National School Lunch Act is further
amended by adding at the end thereof the following new paragraph:
"(8) 'Commodity only schools' means schools that do not participate
in the school lunch program under this Act, but which receive
commodities made available by the Secretary for use by such schools
in nonprofit lunch programs."
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 531
STATE ADMINISTRATIVE EXPENSES
SEC. 814. (a) Section 7(aX2) of the Child Nutrition Act of 1966 is 42 use 1776.
amended by striking out "September 30,1978" in the second sentence
and inserting in lieu thereof September 30,1981".
(b) Section 7(e) of the Child Nutrition Act is amended to read as
follows:
"(e) Notwithstanding any other provision of law, funds made
available to each State under this section shall remain available for
obligation and expenditure by that State during the fiscal year
immediately following the fiscal year for which such funds were
made available. For each fiscal year the Secretary shall establish a
date by which each State shall submit to the Secretary a plan for the
disbursement of funds provided under this section for each such year,
and the Secretary shall reallocate any unused funds, as evidenced by
such plans, to other States as the Secretary considers appropriate. .
AUTHORIZATIONS FOR WIC PROGRAM
SEC. 815. Section 17(g) of the Child Nutrition Act of 1966 is amended 42 use 1786.
by striking out in the first sentence "and such sums as may be
necessary for the three subsequent fiscal years," and inserting in lieu
thereof '^$1,017,000,000 for the fiscal year ending September 30,1982,
$1,060,000,000 for the fiscal year ending September 30, 1983, and
$1,126,000,000 for the fiscal year ending September 30,1984,".
CLAIMS ADJUSTMENT AUTHORITY
SEC. 816. Section 16 of the Child Nutrition Act of 1966 is amended— 42 use 1785.
(1) by inserting "(a)" after "SEC 16."; and
(2) by adding at the end thereof the following new subsection:
"(b) With regard to any claim arising under this Act or under the
National School Lunch Act, the Secretary shall have the authority to 42 use 1751
determine the amount of, to settle and to adjust any such claim, and ^°^^-
to compromise or deny such claim or any part thereof. The Secretary
shall also have the authority to waive such claims if the Secretary
determines that to do so would serve the purposes of either such Act.
Nothing contained in this subsection shall be construed to diminish
the authority of the Attorney General of the United States under
section 516 of title 28, United States Code, to conduct litigation on
behalf of the United States.".
UMITATIONS ON SECRETARY'S AUTHORITY TO DIRECTLY ADMINISTER
PROGRAMS
SEC. 817. (a) Section 10 of the National School Lunch Act is 42 use 1759.
amended to read as follows:
" D I S B U R S E M E N T TO SCHOOLS B Y T H E SECRETARY
"SEC. 10. (a) The Secretary shall withhold funds payable to a State
under this Act and disburse the funds directly to schools, institutions,
or service institutions within the State for the purposes authorized by
this Act to the extent that the Secretary has so withheld and
disbursed such funds continuously since October 1, 1980, but only to
such extent (except as otherwise required by subsection Ot>)). Any
funds so withheld and disbursed by the Secretary shall be used for the
same purposes, and shall be subject to the same conditions, as
applicable to a State disbursing funds made available under this Act.
95 STAT. 532 PUBLIC LAW 97-35—AUG. 13, 1981
If the Secretary is administering (in whole or in part) any program
authorized under this Act, the State in which the Secretary is
administering the program may, upon request to the Secretary,
assume administration of that program.
"(b) If a State educational agency is not permitted by law to
disburse the funds paid to it under this Act to any of the nonpublic
schools in the State, the Secretary shall disburse the funds directly to
such schools within the State for the same purposes and subject to the
same conditions as are authorized or required with respect to the
disbursements to public schools within the State by the State educa-
tional agency.".
42 use 1761. (b) Section 18 of the National School Lunch Act is further amended
by striking out subsection (i).
42 use 1766. (c) Section 17 of the National School Lunch Act is further
amended—
(1) by striking out subsection (m); and
(2) by redesignating subsections (j)> (k), (1), (o), (p), (q), aivd (r), as
suljsections (i), 0'), (k), (1), (m), (n), and (o), respectively.
42 use 1773 (d) Section 4 of the Child Nutrition Act of 1966 is further amended
by striking out subsection (f) and redesignating subsection (g) as
subsection (f).
(e) The Child Nutrition Act of 1966 is further amended by inserting
after section 4 the following new section:
"DISBURSEMENT TO SCHOOLS BY THE SECRETARY
Ante, p. 527. "SEC. 5, (a) The Secretary shall withhold funds payable to a State
42 use 1774. under this Act and disburse the funds directly to schools or institu-
tions within the State for the purposes authorized by this Act to the
extent that the Secretary has so withheld and disbursed such funds
continuously since October 1,1980, but only to such extent (except as
otherwise required by subsection (b)). Any funds so withheld and
disbursed by the Secretary shall be used for the same purposes, and
shall be subject to the same conditions, as applicable to a State
disbursing funds made available under this Act. If the Secretary is
administering (in whole or in part) any program authorized under
this Act, the State in which the Secretary is administering the
program may, upon request to the Secretary, assume administration
of that program.
"(b) If a State educational agency is not permitted by law to
disburse the funds paid to it under this Act to any of the nonpublic
schools in the State, the Secretary shall disburse the funds directly to
such schools within the State for the same purposes and subject to the
same conditions as are authorized or required with respect to the
disbursements to public schools within the State by the State educa-
tional agency.".
42 use 1788. (f) Section 19(d) of the Child Nutrition Act of 1966 is amended by
striking out paragraph (6).
COST SAVINGS REVISIONS BY THE SECRETARY
SEC. 818. As soon as possible after the date of the enactment of this
Act, the Secretary of Agriculture shall review regulations promul-
42 use 1779. gated under section 10 of the Child Nutrition Act of 1966 (including
regulations pertaining to nutritional requirements for meals) for the
purposes of determining ways in which cost savings might be accom-
plished at the local level in the operation of meal programs under the
42 use 1751 National School Lunch Act and the Child Nutrition Act of 1966
note, 1771 note.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 533
without impairing the nutritional value of such meals. Not later than Regulations.
90 days after the date of the enactment of this Act, on the basis of
such review, the Secretary of Agriculture shall promulgate such
regulations as the Secretary considers appropriate to effectuate such
cost savings.
CONFORMING AND MISCELLANEOUS AMENDMENTS
SEC. 819. (a) Section 11 of the National School Lunch Act is 42 use I759a.
amended—
(1) by striking out "financing the cost o f in the first sentence
in subsection (b); and
(2) by striking out "or 5" in subsection (d).
(b) Section 4(c) of the Child Nutrition Act of 1966 is amended by 42 use 1773.
striking out "financing the costs o f in the first sentence.
(c) Section 12 of the National School Lunch Act is amended— 42 use 1760.
(1) in subsection (d)—
(A) by striking out paragraph (3); and
(B) by redesignating paragraphs (4) through (8) (and any
references thereto) as paragraphs (3) through (7), respec-
tively; and
(2) by striking out the second sentence of subsection (h).
(d) Section 8 of the National School Lunch Act is amended— 42 use 1757.
(1) by striking out "or 5" in the first sentence;
(2) by striking out "to finance the cost of obtaining" in the
second sentence and inserting in lieu thereof "to obtain ;
(3) by striking out "and food service equipment assistance in
connection with such program" in the second sentence; and
(4) by striking out "Federal food-cost contribution rate" both
places it occurs in the fifth and sixth sentences and inserting in
lieu thereof "per meal reimbursement rate".
(e) Section 7 of the Child Nutrition Act of 1966 is amended by 42 use 1776.
striking out "3, 4, and 5" in subsections (aXD, (aX2), and (b) and
inserting in lieu thereof "3 and 4".
(f) Section 11(a) of the Child Nutrition Act of 1966 is amended by 42 use 1780.
striking out "section 3 through 5" and inserting in lieu thereof
"sections 3 and 4".
(g) Section 4(a) of the National School Lunch Act is amendied in the 42 use 1753.
first sentence by striking out", excluding the sum specified in section
5,".
(h) Section 6(aX2) of the National School Lunch Act is amended— 42 use 1755.
(1) by striking out "sections 4 and 5" and inserting in lieu
thereof "section 4"; and
(2) by striking out "sections 4, 5, and 7" and inserting in lieu
thereof "sections 4 and 7"
(i) Section 15(f) of the National School Lunch Act is amended by 42 use 1763.
striking out "annually" in the second sentence and inserting in lieu
thereof "biennially".
(j) Section 14 of the National School Lunch Act (42 U.S.C. 1762a) is
amended—
(1) by striking out "title VII" in paragraph (1) of subsection (a)
and inserting in lieu thereof "title III"; and
(2) by striking out "section 707(aX4) of the Older Americans Act
of 1965 (42 U.S.C. 3045(aX4)) or for cash payments in lieu of such
donations under section 707(dXl) of such Act (42 U.S.C.
3045f(dXl))" in the first sentence of subsection (c) and inserting in
lieu thereof "section 311(aX4) of the Older Americans Act of 1965
(42 U.S.C. 303(KaX4)) or for cash payments in lieu of such 42 use 3030a.
95 STAT. 534 PUBLIC LAW 97-35—AUG. 13, 1981
donations under section SlKcXD of such Act (42 U.S.C.
42 u s e 3030a. 3030(cXl))".
(k) The second sentence of section 17(fKl) of the National School
42 use 1766. Lunch Act is amended by striking out "financing the cost of.
EFFECTIVE DATES AND REPEALER
42 use 1753 SEC. 820. (a) The provisions of this title shall take effect as follows:
^°^- (1) The amendments made by the following sections shall take
effect on the first day of the month following the date of the
enactment of this Act, or on September 1, 1981, whichever is
earlier:
(A) section 801;
(B) that portion of the amendment made by section 810(c)
pertaining to the reimbursement rate for supplements;
(C) that portion of the amendment made by section
810(d)(1) pertaining to the limitation on the number of meals
for which reimbursement may be made under the child care
food program;
(D) that portion of the amendment made by section
810(dX3) which reduces the meal reimbursement factor by 10
percent; and
(E) section 811.
(2) The amendments made by sections 802 and 804 shall take
effect on July 1,1981.
(3) The amendments made by sections 807, 808, and 810(aX2)
shall take effect on the first day of the second month following
the date of the enactment of this Act.
(4) The amendments made by the following sections shall take
effect October 1, 1981: sections 805, 806, 809, 810(aXl), 810(f),
810(g), 812,814,817, and 819.
(5) The amendments made by section 813 shall take effect 90
days after the date of the enactment of this Act.
(6) The amendments made by the following provisions shall
take effect January 1, 1982: subsections (b), (c), (d), and (e) of
section 810, except that—
(A) the amendment made by section 810(c) pertaining to
the reimbursement rate for supplements shall take effect as
provided under paragraph (1) of this subsection;
(B) the amendment made by section 810(dXl) pertaining to
the limitation on the number of meals for which reimburse-
ment may be made shall take effect as provided under
paragraph (1) of this subsection; and
(C) the amendment made by section 810(dX3) which re-
duces the meal reimbursement factor by 10 percent shall
take effect as provided under paragraph (1) of this
subsection,
(7) The following provisions shall take effect on the date of the
enactment of this Act:
(A) the amendments made by subsections (a) and (b) of
section 803 and the provisions of subsections (c) and (d) of
section 803;
(B) the amendment made by section 815;
(C) the amendment made by section 816; and
(D) the provisions of section 818.
(b) The Omnibus Reconciliation Act of 1980 (Public Law 96-499) is
amended—
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 535
(1) by striking out subsection (a) of section 201 effective 94 Stat. 2599.
September 1, 1981, or the first day of the first month following 42 u s e 1753
note.
the month in which this Act is enacted, whichever is earlier;
(2) by striking out subsection (a) of section 202 effective July 1, 94 Stat. 2600.
1981; and 42 u s e 1755
note.
(3) by striking out subsections (a) and (b) of section 203 effective 94 Stat. 2600.
on the date of the enactment of this Act. 42 u s e 1758
(c) Not later than 60 da^s after the date of the enactment of this note.
Act, the Secretary of Agriculture shall promulgate regulations to Regulations.
42 u s e 1753
implement the amendments made by this title. note.
TITLE IX—HEALTH SERVICES AND
FACILITIES
Subtitle A—Block Grants
PREVENTIVE HEALTH, HEALTH SERVICES, AND PRIMARY CARE HEALTH
BLOCK GRANTS
SEC. 901. Effective October 1,1981, the Public Health Service Act is 42 use 300w
amended by adding at the end the following new title: ^°^-
"TITLE XIX—BLOCK GRANTS
"PART A—PREVENTIVE HEALTH AND HEALTH SERVICES BLOCK
GRANT
"AUTHORIZATION OF APPROPRIATIONS
"SEC. 1901. (a) For the purpose of allotments under section 1902, 42 use 300w. .
there is authorized to be appropriated $95,000,000 forfiscalyear 1982,
$96,500,000 for fiscal year 1983, and $98,500,000 for fiscal year 1984.
"(b) Of the amount appropriated for any fiscal year under subsec-
tion (a), at least $3,000,000 shall be made available for allotments
under section 1902(b).
"ALLOTMENTS
"SEC. 1902. (aXD From the amounts appropriated under section 42 use 300w-i.
1901 for any fiscal year and available for allotment under this
subsection, the Secretary shall allot to each State an amount which
bears the same ratio to the available amounts for that fiscal year as
the amounts provided by the Secretary under the provisions of law
listed in paragraph (2) to the State and entities in the State for fiscal
year 1981 bore to the total amount appropriated for such provisions of
law forfiscalyear 1981.
"(2) The provisions of law referred to in paragraph (1) are the
following provisions of law as in effect on September 30, 1981:
"(A) The authority for grants under section 317 for preventive 42 use 247b.
health service programs for the the control of rodents.
"(B) The authority for grants under section 317 for establishing
and maintaining community and school-based fluoridation
programs.
"(C) The authority for grants under section 317 for preventive
health service programs for h^)ertension.
"(D) Sections 401 and 402 of the Health Services and Centers
Amendments of 1978. 42 use 247b-i,
"(E) Section 314(d). 247b-2.
va-./ w^Kxwu WX-.VW. 42 u s e 246.
-194 0—82 36 : QL3
95 STAT. 536 PUBLIC LAW 97-35—AUG. 13, 1981
42 use 255. "(F) Section 839(a).
42 use "(G) Sections 1202,1203, and 1204.
300d 300d 3. UQ^^ From the amount required to be made available under section
1901(b) for allotments under this subsection for any fiscal year, the
Secretary shall make allotments to each State on the basis of the
population of the State.
"(c) To the extent that all the funds appropriated under section
1901 for a fiscal year and available for allotment in such fiscal year
are not otherwise allotted to States because—
"(1) one or more States have not submitted an application or
description of activities in accordance with section 1905 for the
fiscal year;
"(2) one or more States have notified the Secretary that they do
not intend to use the full amount of their allotment; or
"(3) some State allotments are offset or repaid under section
1906(b)(3);
such excess shall be allotted among each of the remaining States in
proportion to the amount otherwise allotted to such States for the
fiscal year without regard to this subsection.
"(d)(1) If the Secretary—
"(A) receives a request from the governing body of an Indian
tribe or tribal organization within any State that funds under
this part be provided directly by the Secretary to such tribe or
organization, and
"(B) determines that the members of such tribe or tribal
organization would be better served by means of grants made
directly by the Secretary under this part,
the Secretary shall reserve from amounts which would otherwise be
allotted to such State under subsection (a) for the fiscal year the
amount determined under paragraph (2).
"(2) The Secretary shall reserve for the purpose of paragraph (1)
from amounts that would otherwise be allotted to such State under
subsection (a) an amount equal to the amount which bears the same
ratio to the State's allotment for the fiscal year involved as the total
amount provided or allotted for fiscal year 1981 by the Secretary to
such tribe or tribal organization under the provisions of law referred
to in subsection (a) bore to the total amount provided or allotted for
such fiscal year by the Secretary to the State and entities (including
Indian tribes and tribal organizations) in the State under such
provisions of law.
"(3) The amount reserved by the Secretary on the basis of a
determination under this subsection shall be granted to the Indian
tribe or tribal organization serving the individuals for whom such a
determination has been made.
"(4) In order for an Indian tribe or tribal organization to be eligible
for a grant for a fiscal year under this subsection, it shedl submit to
the Secretary a plan for such fiscal year which meets such criteria as
the Secretary may prescribe.
"Indian tribe," "(5) The terms 'Indian tribe' and 'tribal organization' have the
and "tribal same meaning given such terms in section 4(b) and section 4(c) of the
ol^^^ar^A Knv>
25 use 450b. Indian Self-Determination and Education Assistance Act.
"(e) The Secretary shall conduct a study for the purpose of devising
a formula for the equitable distribution of funds available for allot-
ment to the States under this section. In conducting the study, the
Secretary shall take into account—
"(1) the financial resources of the various States,
"(2) the populations of the States, and
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 537
"(3) any other factor which the Secretary may consider
appropriate.
Before June 30, 1982, the Secretary shall submit a report to the
Congress respecting the development of a formula and make such
recommendations as the Secretary may deem appropriate in order to
ensure the most equitable distribution of funds under allotments
under this section.
"PAYMENTS UNDER ALLOTMENTS TO STATES
"SEC. 1903. (aXD For each fiscal year, the Secretary shall make 42 use 300w-2.
payments, as provided by section 203 of the Intergovernmental
Cooperation Act of 1968 (42 U.S.C. 4213), to each State from its
allotment under section 1902 (other than any amount reserved under
section 1902(d)) from amounts appropriated for that fiscal year.
"(2) Any amount paid to a State for a fiscal year and remaining
unobligated at the end of such year shall remain available for the
next fiscal year to such State for the purposes for which it was made.
"(b) The Secretary, at the request of a State, may reduce the
amount of payments under subsection (a) by—
"(1) the fair market value of any supplies or equipment
furnished the State, and
"(2) the amount of the pay, allowances, and travel expenses of
any officer or employee of the Government when detailed to the
State and the amount of any other costs incurred in connection
with the detail of such officer or employee,
when the furnishing of supplies or equipment or the detail of an
officer or employee is for the convenience of and at the request of the
State and for the purpose of conducting activities described in section
1904. The amount by which any pa5mient is so reduced shall be
available for pa3maent by the Secretary of the costs incurred in
furnishing the supplies or equipment or in detailing the personnel, on
which the reduction of the payment is based, and the amount shall be
deemed to be part of the pajnnent and shall be deemed to have been
paid to the State.
"USE OP ALLOTMENTS
"SEC. 1904. (aXD Except as provided in subsections (b) and (c), 42USC300w-3.
amounts paid to a State under section 1903 from its allotment under
section 1902(a) and amounts transferred by the State for use under
this part may be used for the following:
"(A) Preventive health service programs for the control of
rodents and community and school-based fluoridation programs.
"(B) Establishing and maintaining preventive health service
programs for screening for, the detection, diagnosis, prevention,
and referral for treatment of, and follow-up on compliance with
treatment prescribed for, hjrpertension.
"(C) Community based programs for the purpose of demon-
strating and evaluating optimal methods for organizing and
delivering comprehensive preventive health services to defined
populations, comprehensive programs designed to deter smoking
and the use of alcoholic beverages simong children and adoles-
cents, and other risk-reduction and health education programs.
"(D) Comprehensive public health services.
"(E) Demonstrate the establishment of home health agencies
(as defined in section 1861(m) of the Social Security Act) in areas 42 use I395x.
where the services of such agencies are not available. Amounts
95 STAT. 538 PUBLIC LAW 97-35—AUG. 13, 1981
provided for such agencies may not be used for the direct
provision of health services.
"(F) FeasibiUty studies and planning for emergency medical
services systems and the establishment, expeuision, and improve-
ment of such systems. Amounts for such systems may not be used
for the costs of the operation of the systems or the purchase of
equipment for the systems.
"(G) Providing services to rape victims and for rape
prevention.
Amounts provided for the activities referred to in the preceding
sentence may also be used for related planning, administration, and
educational activities.
"(2) Except as provided in subsection (b), amounts paid to a State
under section 1903 from its allotment under section 1902(b) may only
be used for providing services to rape victims and for rape prevention.
"(3) The Secretary may provide technical assistance to States in
planning and operating activities to be carried out under this part.
"(b) A State may not use amounts paid to it under section 1903 to—
"(1) provide inpatient services,
"(2) make cash payments to intended recipients of health
services,
"(3) purchase or improve land, purchase, construct, or perma-
nently improve (other than minor remodeling) any building or
other facility, or purchase major medical equipment,
"(4) satisfy any requirement for the expenditure of non-
Federal funds as a condition for the receipt of Federal funds, or
"(5) provide financial assistance to any entity other than a
public or nonprofit private entity.
Except as provided in subsection (aXlXE), the Secretary may waive
the limitation contained in paragraph (3) upon the request of a State
if the Secretary finds that there are extraordinary circumstances to
justify the waiver and that granting the waiver will assist in carrying
out this part.
"(c) A State may transfer not more than 7 percent of the amount
allotted to the State under section 1902(a) for einy fiscal year for use
by the State under parts B and C of this title and title V of the Social
^o^hEnqm' ^^^ Security Act in such fiscal year £is follows: At any time in the first
use 701. three quarters of the fiscal year a State may transfer not more than 3
percent of the allotment of the State for the fiscal year for such use,
and in the last quarter of a fiscal year a State may transfer for such
use not more than the remainder of the amount of its allotment
which may be transferred.
"(d) Of the am<"unt paid to any State under section 1903, not more
than 10 percent paid from each of its allotments under subsections (a)
and (b) of section 1902 may be used for administering the funds made
available under section 1903. The State will pay from non-Federal
sources the remaining costs of administering such funds.
"APPLICATION AND DESCRIPTION OF ACTIVITIES
42 use 300W-4. "SEC. 1905. (a) In order to receive an allotment for a fiscal year
under section 1902 each State shall submit an application to the
Secretary. Each such application shall be in such form and submitted
by such date as the Secretary shall require. Each such application
shall contain assurances that the legislature of the State has com-
plied with the provisions of subsection (b) and that the State will meet
the requirements of subsection (c).
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 539
"(b) After the expiration of the first fiscal year in which a State
receives an allotment under section 1902, no funds shall be allotted to
such State for any fiscal year under such section unless the legisla-
ture of the State conducts public hearings on the proposed use and
distribution of funds to be provided under section 1903 for such fiscal
year.
"(c) As part of the annual application required by subsection (a), the
chief executive officer of each State shall certify that the State—
"(1) agrees to use the funds alloted to it under section 1902 in
accordance with the requirements of this part;
"(2) except as provided in subsection (e), shall make grants for
fiscal year 1982 to each entity within the State which received a
grant or contract under section 1202,1203, or 1204 in fiscal year ^^-JJ^f^o,.^, „
1981 and which would be eligible to receive a grant or contract 300d-i-300<i-3.
under such section (as in effect on September 30, 1981) for such
fiscal year if such grants or contracts were made under such
section;
"(3) agrees to establish reasonable criteria to evaluate the
effective performance of entities which receive funds from the
allotment of the State under this part and procedures for
procedural and substantive independent State review of the
failure by the State to provide funds for any such entity.
"(4) agrees to make grants for preventive health service pro-
grams for h5rpertension in amounts equal to—
"(A) for fiscal year 1982, 75 percent of the total amount
provided by the &cretary in fiscal year 1981 to the State and
entities in the State under section 317 for such programs,
"(B) for fiscal year 1983, 70 percent of such total amount,
and
"(C) for fiscal year 1984, 60 percent of such total amount.
"(5) agrees to permit and cooperate with Federal investigations
undertaken in accordance with section 1907;
"(6) has identified those populations, areas, and localities in
the State with a need for the services for which funds may be
provided by the State under this part;
"(7) agrees that Federal funds made available under section
1903 for £uiy period will be so used as to supplement and increase
the level of State, local, £md other non-Federal funds that would
in the absence of such Federal funds be made available for the
programs and activities for which funds are provided under that
section and will in no event supplant such State, local, and other
non-Federal funds; and
"(8) has in effect a system to protect from inappropriate
disclosure patient and rape victim records maintained by the
State in connection with an activity funded under this part or by
any entity which is receiving payments from the allotment of the
State under this part.
The Secretary may not prescribe for a State the manner of compli-
ance with the requirements of this subsection.
"(d) The chief executive officer of a State shall, as part of the
application required by subsection (a), also prepare and furnish the
Secretary (in accordance with such form as the Secretary shall
provide) with a description of the intended use of the payments the
State will receive under section 1903 for the fiscal year for which the
application is submitted, including information on the programs and
activities to be supported and services to be provided. The description
shall be made public within the State in such manner as to facilitate
comment from any person (including £uiy Federal or other public
95 STAT. 540 PUBLIC LAW 97-35-AUG. 13, 1981
agency) during development of the description and after its transmit-
tal. The description shall be revised (consistent with this section)
throughout the year as may be necessary to reflect substantial
changes in the programs and activities assisted by the State under
this part, and any revision shall be subject to the requirements of the
preceding sentence.
"(e) A State shall be required to make a grant to an entity as
prescribed by subsection (c)(2) unless—
"(1) the State recommends on the basis of—
"(A) any Federal finding. Federal administrative action, or
judicial proceeding with respect to any such entity, or
"(B) a review of such entity in accordance with the criteria
and procedures required under subsection (c)(3),
that the State not be required to make such grants; and
"(2) the Secretary approves the recommendation of the State
under paragraph (1) based upon a substantive and procedural
review of the record made by the State in making its recommen-
dation under paragraph (1).
"REPORTS AND AUDITS
42USC300W-5. "SEC. 1906. (a)(1) Each State shall prepare and submit to the
Secretary annual reports on its activities under this part. Such
reports shall be in such form and contain such information as the
Secretary determines (after consultation with the States and the
Comptroller General) to be necessary (A) to determine whether funds
were expended in accordance with this part and consistent with the
needs within the State identified pursuant to section 1905(c)(6), (B) to
secure a description of the activities of the State under this part, and
(C) to secure a record of the purposes for which funds were spent, of
the recipients of such funds, and of the progress made toward
achieving the purposes for which the funds were provided. Copies of
the report shall be provided, upon request, to any interested person
(including any public agency),
i "(2) In determining the information that States must include in the
report required by this subsection, the Secretary may not establish
reporting requirements that are burdensome.
"(b)(1) Each State shall establish fiscal control and fund accounting
procedures as may be necessary to assure the proper disbursal of and
accounting for Federal funds paid to the State under section 1903 and
! funds transferred under section 1904(c) for use under this part.
"(2) Each State shall annually audit its expenditures from pay-
ments received under section 1903. Such State audits shall be
conducted by an entity independent of any agency administering a
program funded under this part and, in so far as practical, in
accordance with the Comptroller General's standards for auditing
governmental organizations, progreims, activities, and functions.
Within 30 days following the date each audit is completed, the chief
executive officer of the State shall transmit a copy of that audit to the
Secretary.
Notice and "(3) Each State shall, after being provided by the Secretary with
hearing. adequate notice and opportunity for a hearing within the State, repay
to the United States amounts found not to have been expended in
accordance with the requirements of this part or the certification
provided by the State under section 1905. If such repayment is not
made, the Secretary shall, after providing the State with adequate
notice and opportunity for a hearing within the State, offset such
PUBLIC LAW 97-35—AUG. 13,1981 95 STAT. 541
amounts against the amount of any allotment to which the State is or
may become entitled imder this part.
(4) The State shall make copies of the reports and audits required Public
by this section available for public inspection within the State. inspection.
"(5) The Comptroller General of the United States shall, from time
to time, evaluate the expenditures by States of grants under this part
in order to assure that expenditures are consistent with the provi-
sions of this part and the certification provided by the State under
section 1905.
"(6) Not later than October 1,1983, the Secretary shall report to the Report to
Congress on the activities of the States that have received funds Congress.
under this part and ma>[ include in the report any recommendations
for appropriate changes in legislation.
"(c) Title XVII of the Omnibus Budget Reconciliation Act of 1981 Post, p. 753
shall not apply with respect to audits of funds allotted under this
part.
"WITHHOLDING
"SEC. 1907. (aXD The Secretary shall, after adequate notice and an Notice and
opportunity for a hearii^ conducted within the affected State, hearing.
withhold funds from any State which does not use its allotment in 42 u s e 300W-6.
accordance with the requirements of this part or the certification
provided under section 1905. The Secretary shall withhold such fimds
until the Secretary finds that the reason for the withholding has been
removed and there is reasonable assurance that it will not recur.
"(2) The Secretai^ may not institute proceedings to withhold funds
under paragraph (1) unless the Secretary has conducted an investiga-
tion concerning whether the State has used its allotment in accord-
ance with the requirements of this part or the certification provided
under section 1905. Investigations required by this paragraph shall
be conducted within the affected State by qualified investigators.
"(3) The Secretary shall respond in an expeditious manner to
complaints of a substantial or serious nature that a State has failed to
use funds in accordance with the requirements of this part or
certifications provided under section 1905.
"(4) The Secretary may not withhold funds under parg^aph (1)
from a State for a minor failure to comply with the requirements of
this part or certifications provided under section 1905.
"(bXl) The Secretary shall conduct in several States in each fiscal
year investigations of the use of funds received by the States under
this part in order to evaluate compliance with the requirements of
this part and certifications provided under section 1905.
"(2) The Comptroller General of the United States may conduct
investigations of the use of funds received under this part by a State
in order to insure compliance with the requirements of this part and
certifications provided under section 1905.
"(c) Each State, and each entity which has received funds from an
£illotment made to a State under this part, shall make appropriate
books, documents, papers, and records avaUable to the Secretary or
the Comptroller General of the United States, or any of their duly
authorized representatives, for examination, copjdng, or mechanical
reproduction on or off the premises of the appropriate entity upon a
reasonable request therefor.
"(dXD In conducting any investigation in a State, the Secretary or
the Comptroller General of the United States may not make a request
for any information not readily available to such State or an entity
which has received funds from an allotment made to the State under
95 STAT. 542 PUBLIC LAW 97-35—AUG. 13, 1981
this part or make an unreasonable request for information to be
compiled, collected, or transmitted in any form not readily available.
"(2) Paragraph (1) does not apply to the collection, compilation, or
transmittal of data in the course of a judicial proceeding.
"NONDISCRIMINATION
42 use 300W-7. "SEC. 1908. (aXD For the purpose of applying the prohibitions
against discrimination on the basis of age under the Age Discrimina-
42 use 6101 tion Act of 1975, on the basis of handicap under section 504 of the
29 use 794 Rehabilitation Act of 1973, on the basis of sex under title IX of the
20 use 1681 Education Amendments of 1972, or on the basis of race, color, or
42 use 2000d. national origin under title VI of the Civil Rights Act of 1964,
programs and activities funded in whole or in part with funds made
available under this part are considered to be programs and activities
receiving Federal financial assistance.
"(2) No person shall on the ground of sex or religion be excluded
from participation in, be denied the benefits of, or be subjected to
discrimination under, any program or activity funded in whole or in
part with funds made available under this part.
"(b) Whenever the Secretary finds that a State, or an entity that
has received a payment from an allotment to a State under section
1902, has failed to comply with a provision of law referred to in
subsection (aXl), with subsection (aX2), or with an applicable regula-
tion (including one prescribed to carry out subsection (aX2)), the
Secretary shall notify the chief executive officer of the State and shall
request him to secure compliance. If within a reasonable period of
time, not to exceed sixty days, the chief executive officer fails or
refuses to secure compliance, the Secretary may—
"(1) refer the matter to the Attorney General with a recom-
mendation that an appropriate civil action be instituted,
"(2) exercise the powers and functions provided by title VI of
the Civil Rights Act of 1964, the Age Discrimination Act of 1975,
or section 504 of the Rehabilitation Act of 1973, as may be
applicable, or
"(3) take such other action as may be provided by law.
"(c) When a matter is referred to the Attorney General pursuant to
subsection (bXD, or whenever he has reason to believe that a State or
an entity is engaged in a pattern or practice in violation of a provision
of law referred to in subsection (aXl) or in violation of subsection
(aX2), the Attorney General may bring a civil action in any appropri-
ate district court of the United States for such relief as may be
appropriate, including injunctive relief.
"CRIMINAL PENALTY FOR FALSE STATEMENTS
42 use 300W-8. "SEC. 1909. Whoever—
"(1) knowingly and willfully makes or causes to be made any
false statement or representation of a material fact in connection
with the furnishing of items or services for which payment may
be made by a State from funds allotted to the State under this
part, or
"(2) having knowledge of the occurrence of any event affecting
his initial or continued right to any such payment conceals or
fails to disclose such event with an intent fraudulently to secure
such payment either in a greater amount than is due or when no
such payment is authorized.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 543
shall be fined not more than $25,000 or imprisoned for not more than
five years, or both.".
"PART B—ALCOHOL AND DRUG ABUSE AND MENTAL HEALTH
SERVICES BLOCK GRANT
"AUTHORIZATION OF APPROPRIATIONS
"SEC. 1911. For the purpose of grants and allotments under section 42 use 300x.
1912, there is authorized to be appropriated $491,000,000 for fiscal
year 1982, $511,000,000 for fiscal year 1983, and $532,000,000 for fiscal
year 1984.
"GRANTS AND ALLOTMENTS
"SEC. 1912. (aXD The Secretary may use not more than 1 percent of 42 use 300x-i.
the amount appropriated under section 1911 for any fiscal year to
make grants to public and nonprofit private entities for projects for
the training and retredning of employees adversely affected by
changes in the delivery of mental health services and for providing
such employees assistance in securing emplo3niient.
"(2) No grant may be made by the Secretary under paragraph (1)
unless an application therefor has been submitted to, and approved
by, the Secretary. Such application shall be in such form, submitted
in such manner, and contain and be accompanied by such informa-
tion, as the Secretary may specify. No such application may be
approved unless it contains assurances that the applicant will use the
funds provided only for the purposes specified in the approved
application and will establish such fiscal control and fund accounting
procedures as may be necessary to assure proper disbursement and
accounting of Federal funds paid to the applicant under paragraph
(1).
"(b)(1) From the remainder of the amount appropriated under
section 1911 for any fiscal year, the Secretary shall allot to each State
an amount which bears the same ratio to such remainder for that
fiscal year as the amounts—
"(A) which would have been provided by the Secretary to the
State and entities in the State under the Community Mental
Health Centers Act and the Mental Health Systems Act for fiscal
year 1981 if the Secretary had obligated all the funds for mental
health services available for such Acts under Public Law 96-536, 94 Stat. 3166.
and
"(B) provided by the Secretary to the State and entities in the
State under the laws referred to in subparagraphs (C) and (D) of
paragraph (2) for fiscal year 1980,
bore to the total amount appropriated for mental health services for
fiscal year 1981 under Public Law 96-536 under the Community
Mental Health Centers Act and the Mental Health Systems Act and 42 USC 2689
the total amount appropriated for fiscal year 1980 for the provisions ^°^^-
of law referred to in subparagraphs (C) and (D) of paragraph (2). ^^ f*^^- l^^f-
"(2) The provisions of law referred to in paragraph (1) are the ^otY
following provisions of law as in effect on the day before the date of
the enactment of the Omnibus Budget Reconciliation Act of 1981:
"(A) The Community Mental Health Centers Act.
"(B) The Mental Health Systems Act.
"(C) Sections 301 and 312 of the Comprehensive Alcohol Abuse
and Alcoholism Prevention, Treatment, and Rehabilitation Act
of 1970. 42 USC 4571.
4578.
95 STAT. 544 PUBLIC LAW 97-35—AUG. 13, 1981
"(D) Sections 409 and 410 of the Drug Abuse Prevention,
21 use 1176, Treatment, and Rehabilitation Act.
il'^'^- "(3) To the extent that all the funds appropriated under section
1911 for a fiscal year and available for allotment in such fiscal year
are not otherwise allotted to States because—
"(A) one or more States have not submitted an application or
description of activities in accordance with section 1915 for the
fiscal year;
"(B) one or more States have notified the Secretary that they
do not intend to use the full amount of their allotment; or
"(C) some State allotments are offset or repaid under section
1916(b)(3);
such excess shall be allotted among each of the remaining States in
proportion to the amount otherwise allotted to such States for the
fiscal year without regard to this paragraph.
"(c)(1) If the Secretary—
"(A) receives a request from the governing body of an Indian
tribe or tribal organization within any State that funds under
this part be provided directly by the Secretary to such tribe or
organization, and
(B) determines that the members of such tribe or tribal
organization would be better served by meeuis of grants made
directly by the Secretary under this part,
the Secretary shall reserve from amounts which would otherwise be
allotted to such State under subsection (b) for the fiscal year the
amount determined under paragraph (2).
"(2) The Secretary shall reserve for the purpose of paragraph (1)
from amounts that would otherwise be allotted to such State under
subsection (b) an amount equal to the amount which bears the same
ratio to the State's allotment for the fiscal year involved as the total
amount provided or allotted for fiscal year 1980 by the Secretary to
such tribe or tribal organization under the provisions of law referred
to in subsection (bX2) bore to the total amount provided or allotted for
such fiscal year by the Secretary to the State £ind entities (including
Indian tribes and tribal organizations) in the State under such
provisions of law.
"(3) The amount reserved by the Secretary on the basis of a
determination under this subsection shall be granted to the Indian
tribe or tribal organization serving the individuals for whom such a
determination has been made.
"(4) In order for an Indian tribe or tribal organization to be eligible
for a grant for a fiscEil year under this subsection, it shall submit to
the Secretary a plan for such fiscal year which meets such criteria as
the Secretary may prescribe.
"Indian tribe," "(5) The terms Indian tribe' and 'tribal organization' have the
and "tribal same meaning given such terms in section 4(b) and section 4(c) of the
°^t^u^AKm^
25 use 450b. Indian Self-Determination and Education Assistance Act.
"(d) The Secretary shall conduct a study for the purpose of devising
a formula for the equitable distribution of funds available for allot-
ment to the States under subsection (b). In conducting the study, the
Secretary shall take into account—
"(1) the financial resources of the various States,
"(2) the populations of the States, and
"(3) any other factor which the Secretary may consider
appropriate.
Before June 30, 1982, the Secretary shall submit a report to the
Congress respecting the development of a formula and make such
recommendations as the Secretary may deem appropriate in order to
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 545
insure the most equitable distribution of funds under allotments
under subsection (b).
"PAYMENTS UNDER ALLOTMENTS TO STATES
"SEC. 1913. (aXD For each fiscal year, the Secretary shall make 42 use 300x-2.
payments, as provided by section 203 of the Intergovernmental
Cooperation Act of 1968 (42 U.S.C. 4213), to each State from its
allotment under section 1912(b) (other than any amount reserved
under section 1912(c)) from smiounts appropriated for that fiscal year.
"(2) Any amount paid to a State for a fiscal year and remaining
unobligated at the end of such year shall remain available to such
State for the purposes for which it was made for the next fiscal year.
"(b) The Secretary, at the request of a State, may reduce the
amount of pajonents under subsection (a) by—
"(1) the fair market value of any supplies or equipment
furnished the State, and
"(2) the amount of the pay, allowances, and travel expenses of
any officer or employee of the Government when detailed to the
State and the amount of any other costs incurred in connection
with the detail of such officer or employee,
when the furnishing of supplies or equipment or the detail of an
officer or employee is for the convenience of and at the request of the
State and for the purpose of conducting activities described in section
1914. The amount by which any pa3mient is so reduced shall be
available for pa3nnent by the Secretary of the costs incurred in
furnishing the supplies or equipment or in detailing the personnel, on
which the reduction of the pajnnent is based, and the amount shall be
deemed to be part of the payment and shall be deemed to have been
paid to the State.
"USE OF ALLOTMENTS
"SEC. 1914. (a)(1) Except as provided in subsections (b) and (c), 42 use 300x-3.
amounts paid to a State under section 1913 and amounts transferred
by the State for use under this part may be used by the State for—
"(A) planning, establishing, maintaining, coordinating, and
evaluating projects for the development of more effective preven-
tion, treatment, and rehabilitation programs and activities to
deal with alcohol and drug abuse; and
"(B) grants to community mental health centers in accordance
with section 1915(c) and grants to community mental health
centers for the provision of the following services:
"(i) Services for chronically mentally ill individuals, which
include identification of chronically mentally ill individuals
and assistance to such individuals in gaining access to
essentied services through the assignment of case managers,
"(ii) Identification and assessment of severely mentally
disturbed children and adolescents and provision of appro-
priate services to such individuals.
"(iii) Identification and assessment of mentally ill elderly
individuals and provision of appropriate services to such
individuals.
"(iv) Services for identifiable populations which are cur-
rently underserved in the State.
"(v) Coordination of mental health and health care serv-
ices provided within health care centers.
95 STAT. 546 PUBLIC LAW 97-35—AUG. 13, 1981
Amounts provided for the activities referred to in the preceding
sentence may also be used for related planning, administration, and
educational activities.
"(2) The Secretary may provide technical assistance to States in
planning and operating activities to be carried out under this part.
"(b) A State may not use amounts paid to it under section 1913 to—
"(1) provide inpatient services in the case of amounts provided
for community mental health centers or provide inpatient hospi-
tal services in the case of amounts provided for alcohol or drug
abuse programs,
"(2) make cash payments to intended recipients of health
services,
"(3) purchase or improve land, purchase, construct, or perma-
nently improve (other than minor remodeling) any building or
other facility, or purchase major medical equipment,
"(4) satisfy any requirement for the expenditure of non-
Federal funds as a condition for the receipt of Federal funds, or
"(5) provide financial assistance to any entity other than a
public or nonprofit private entity.
The Secretary may waive the limitation contained in paragraph (3)
upon the request of a State if the Secretary finds that there are
extraordinary circumstances to justify the waiver and that granting
the waiver will assist in canying out this part.
"(c) A State may transfer not more than 7 percent of the amount
allotted to the State under section 1912 for any fiscal year for use by
the State under parts A and C of this title and title V of the Social
Ante, p. 535, Security Act in such fiscal year as follows: At any time in the first
42* n'<?r 7m three quarters of the fiscal year a State may transfer not more than 3
use 701. percent of the allotment of the State for the fiscal year for such use,
and in the last quarter of a fiscal year a State may transfer for such
use not more than the remainder of the amount of its allotment
which may be transferred.
"(d) Of the amount paid to any State under section 1913, not more
than 10 percent may be used for administering the funds made
available under such section. The State will pay from non-Federal
sources the remaining costs of administering such funds.
"APPLICATION AND DESCRIPTION OP ACTIVITIES
42 use 300x-4. "SEC. 1915. (a) In order to receive an allotment for a fiscal year
under section 1912(b) each State shall submit an application to the
Secretary. Each such application shall be in such form and submitted
by such date as the Secretary shall require. Each such application
shall contain assurances that the legislature of the State has com-
plied with the provisions of subsection (b) and that the State will meet
the requirements of subsection (c).
"(b) After the expiration of the first fiscal year in which a State
receives an allotment under section 1912(b), no funds shall be allotted
to such State for any fiscal year under such section unless the
legislature of the State conducts public hearings on the proposed use
and distribution of funds to be provided under section 1913 for such
fiscal year.
"(c) As part of the annual application required by subsection (a), the
chief executive officer of each State shall certify as follows:
"(1) The State agrees to use the funds alloted to it under section
1912 in accordance with the requirements of this part.
"(2) Except as provided in subsection (e), for fiscal years 1982,
1983, and 1984, the State agrees to make grants, subject to
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 547
paragraphs (3) and (4), to each community mental health center
within the State which received a grant under the Community
Mental Health Centers Act in fiscal year 1981 and which would 42 use 2689
be eligible to receive a grant for its operation under that Act (as ^°^-
in effect on the day before the date of the enactment of the
Omnibus Budget Reconciliation Act of 1981) for suchfiscalyear if
such grants were made under such Act.
"(3) The State agrees to make grants to community mental
health centers in the State for the provision of comprehensive
mental health services—
"(A) principally to individuals residing in a defined geo-
graphic area (hereinafter in this section referred to as a
inental health service area'), with special attention to indi-
viduals who are chronically mentally ill,
"(B) within the limits of its capacity, to any individual
residing or employed in its mental health service area
regardless of ability to pay for such services, current or past
health condition, or any other factor, and
"(C) which are available and accessible promptly, as appro-
priate and in a manner which preserves human dignity and
assures continuity and high quality care.
"(4) The State agrees to require that any community mental
health center in the State receiving a grant from the State under
this part provide—
"(A) outpatient services, including specialized outpatient
services for children, the elderly, individuals who are chron-
ically mentally ill, and residents of its mental health service
area who have been discharged from inpatient treatment at
a mental health facility,
"(B) 24-hour-a-day emergency care services,
"(C) day treatment or other partial hospitalization
services,
"(D) screening for patients being considered for admission
to State mental health facilities to determine the appropri-
ateness of such admission, and
"(E) consultation and education services.
"(5) The State agrees to establish reasonable criteria to evalu-
ate the effective performance of entities which receive funds
from the State under this part and procedural and substantive
independent State review procedures of the failure by the State
to provide funds for any such entity.
(6)(A) The State agrees to use the funds allotted to it under
section 1912 for fiscal year 1982 for the mental health and alcohol
and drug abuse activities prescribed by section 1914(a) as follows:
"(i) The amount provided for mental health activities shall
not exceed an amount which bears the same relationship to
the funds allotted to the State for such fiscal year as the
funds for mental health services which would have been
received by the State and entities in the State in fiscal year
1981 under the Community Mental Health Centers Act and
the Mental Health Systems Act if the Secretary had obli- 94 stat. 1564.
gated all of the funds appropriated for such Acts under 42 use 9401
Public Law 96-536 bore to the funds which would have been gj It^t 3166
so received by the State and entities in the State in such
fiscal year under such Acts and the funds received by the
State and entities in the State in fiscal year 1980 under
sections 301 and 312 of the Comprehensive Alcohol Abuse
and Alcoholism Prevention, Treatment, and Rehabilitation
95 STAT. 548 PUBLIC LAW 97-35—AUG. 13, 1981
42 use 4571, Act of 1970 and sections 409 and 410 of the Drug Abuse
21 use 1176 Prevention, Treatment, and Rehabilitation Act.
1177 ' "(ii) The amount provided for alcohol and drug abuse
activities shall not exceed an amount which bears the same
relationship to the funds allotted to the State for such fiscal
year as the funds received by the State and entities in the
State in fiscal year 1980 under sections 301 and 312 of the
Comprehensive Alcohol Abuse and Alcoholism Prevention,
Treatment, and Rehabilitation Act of 1970 and sections 409
and 410 of the Drug Abuse Prevention, Treatment, and
Rehabilitation Act bore to the funds received by the State
and entities in the State in such fiscal year under such
sections and the funds for mental health services which
would have been received by the State and entities in the
State in fiscal year 1981 under the Community Mental
42 use 2689 Health Centers Act and the Mental Health Systems Act if
?564' ^^ ^^^^ **^® Secretary had obligated all of the funds appropriated for
42 use 9401 ^^*^^ ^^^ under Public Law 96-536.
note. "(B) The State agrees to use 95 percent of the funds allotted to
94 Stat. 3166. it under section 1912 for fiscal year 1983 for the mental health
and alcohol and drug abuse activities prescribed by section
1914(a) as prescribed by subparagraph (A).
"(C) The State agrees to use 85 percent of the funds allotted to
it under section 1912 for fiscal year 1984 for the mental health
and alcohol and drug abuse activities prescribed by section
1914(a) as prescribed by subparagraph (A).
"(7) In any fiscal year, the State agrees to use funds for the
alcohol and drug abuse activities prescribed by section 1914(a) as
follows:
"(A) Not less than 35 percent of the amount to be made
available for such activities shall be used for programs and
activities relating to alcoholism and alcohol abuse.
"(B) Not less than 35 percent of the amount to be made
available for such activities shall be used for programs and
activities relating to drug abuse.
"(8) Of the amount to be used in any fiscal year for alcohol or
drug abuse activities, the State agrees to use not less than 20
percent of such amount for prevention and early intervention
programs designed to discourage the abuse of alcohol or drugs, or
both.
"(9) The State agrees to permit and cooperate with Federal
investigations undertaken in accordance with section 1917.
"(10) That the State has identified those populations, areas,
and localities in the State with a need for mental health, alcohol
, abuse and alcoholism, and drug abuse services.
I "(11) That the Federal funds made available under section 1913
! for any period will be so used as to supplement and increase the
level of State, local, and other non-Federal funds that would in
the absence of such Federal funds be made available for the
programs and activities for which funds are provided under that
section and will in no event supplant such State, local, and other
non-Federal funds.
"(12) That the State has in effect a system to protect from
inappropriate disclosure patient records maintained by the State
in connection with an activity funded under this part or by any
entity which is receiving payments from the allotment of the
State under this part.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 549
"(13) That the State shall develop and implement arrange-
ments, which are not excessively burdensome on the State, to
locate jobs for employees affected adversely by actions taken by
the State mental health authority to emphasize outpatient
mental health services.
The Secretary may not prescribe for a State the manner of compli-
ance with the requirements of this subsection.
"(d) The chief executive officer of a State shall, as part of the
application required by subsection (a), also prepare and furnish the
Secretary (in accordance with such form as the Secretary shall
provide) with a description of the intended use of the payments the
State will receive under section 1913 for the fiscal year for which the
application is submitted, including information on the programs and
activities to be supported and services to be provided. The description
shall be made public within the State in such manner as to facilitate
comment from any person (including any Federal or other public
agency) during development of the description and after its transmit-
tal. The description shall be revised (consistent with this section)
throughout the year as may be necessary to reflect substantial
changes in the programs and activities assisted by the State under
this part, and any revision shall be subject to the requirements of the
preceding sentence.
"(e) A State shall be required to make a grant to a community
mental health center under subsection (c)(2) unless—
"(1) the State recommends on the basis of—
"(A) any Federal finding, Federal administrative action, or
judicial proceeding with respect to any such community
mental health center, or
"(B) a review of such center in accordance with the criteria
and procedures required under subsection (c)(5),
that the State not be required to make such grants; and
"(2) the Secretary approves the recommendation of the State
under paragraph (1) based upon a substantive and procedural
review of the record made by the State in making its recommen-
dation under paragraph (1) which review demonstrates that the
community mental health center is not providing services as
prescribed by paragraphs (3) and (4) of subsection (c) or is engaged
in a substantial misuse of funds.
"REPORTS AND AUDITS
SEC. 1916. (a) Each State shall prepare and submit to the Secretary 42 use 300x-5.
annual reports on its activities under this part. Such reports shall be
in such form and contain such information as the Secretary deter-
mines (after consultation with the States and the Comptroller Gen-
eral) to be necessary (1) to determine whether funds were expended in
accordance with this part and consistent with the needs within the
State identified pursuant to section 1915(cX10), (2) to secure a descrip-
tion of the activities of the State under this part, and (9D to secure a
record of the purposes for which funds were spent, of the recipients of
such funds, and of the progress made toward achieving the purposes
for which the funds were provided. Copies of the report shall be
provided, upon request, to any interested person (including any
public agency).
"(2) In determining the information that States must include in the
report required by this subsection, the Secretary may not establish
reporting requirements which are burdensome.
95 STAT. 550 PUBLIC LAW 97-35—AUG. 13, 1981
"(b)(1) Each State shall establish fiscal control and fund accounting
procedures as may be necessary to assure the proper disbursal of and
accounting for Federal funds paid to the State under section 1913 and
funds transferred for use under this part.
"(2) Each State shall annually audit its expenditures from pay-
ments received under section 1913. Such State audits shall be
conducted by an entity independent of any agency administering a
program funded under this part and, in so far as practical, in
accordance with the Comptroller General's standards for auditing
governmental organizations, programs, activities, and functions.
Within 30 days following the date each audit is completed, the chief
executive officer of the State shall transmit a copy of that audit to the
Secretary.
"(3) Each State shall, after being provided by the Secretary with
adequate notice and opportunity for a hearing within the affected
State, repay to the United States amounts found not to have been
expended in accordance with the requirements of this part or the
certification provided under section 1915. If such repayment is not
made, the Secretary shall, after providing the State with adequate
notice and opportunity for a hearing, offset such amounts against the
amount of any allotment to which the State is or may become entitled
under section 1912.
"(4) The State shall make copies of the reports and audits required
by this section available for public inspection within the State.
"(5) The Comptroller General of the United States shall, from time
to time, evaluate the expenditures by States of grants under this part
in order to assure that expenditures are consistent with the provi-
sions of this part.
"(6) Not later than October 1,1983, the Secretary shall report to the
Congress on the activities of the States which have received funds
under this part and may include in the report any recommendations
for appropriate changes in legislation.
"(c) The provisions of title XVII of the Omnibus Budget Reconcili-
Post, p. 753. ation Act of 1981 shall not apply with respect to the audit of funds
allotted under this part.
"WITHHOLDING
42 use 300X-6. "SEC. 1917. (a)(1) The Secretary shall, after adequate notice and an
opportunity for a hearing conducted within the affected State,
withhold funds from any State which does not use its allotment in
accordance with the requirements of this part or the certification
provided under section 1915. The Secretary shall withhold such funds
until the Secretary finds that the reason for the withholding has been
removed and there is reasonable assurance that it will not recur.
"(2) The Secretary may not institute proceedings to withhold funds
under paragraph (1) unless the Secretary has conducted an investiga-
tion concerning whether the State has used its allotment in accord-
ance with the requirements of this part or the certification provided
under section 1915. Investigations required by this paragraph shall
be conducted within the affected State by qualified investigators.
"(3) The Secretary shall respond in an expeditious manner to
complaints of a substantial or serious nature that a State has failed to
use funds in accordance with the requirements of this part or the
certification provided under section 1915.
"(4) The Secretary may not withhold funds under paragraph (1)
from a State for a minor failure to comply with the requirements of
this part or the certification provided under section 1915.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 551
"(bXD The Secretary shall conduct in several States in each fiscal
year investigations of the use of funds received by the States under
this part in order to evaluate compliance with the requirements of
this part and the certification provided under section 1915.
"(2) The Comptroller General of the United States may conduct
investigations of the use of funds received under this part by a State
in order to insure compliance with the requirements of this part and
the certification provided under section 1915.
"(c) Each State, and each entity which has received funds from an
allotment made to a State under this part, shall make appropriate
books, documents, papers, and records available to the Secretary or
the Comptroller General of the United States, or any of their duly
authorized representatives, for examination, cop3dng, or mechanical
reproduction on or off the premises of the appropriate entity upon a
reasonable request therefor.
"(dXD In conducting any investigation in a State, the Secretary or
the Comptroller General of the United States may not make a request
for any information not readily available to such State or an entity
which has received funds from an allotment made to the State under
this part or make an unreeisonable request for information to be
compiled, collected, or transmitted in any form not readily available.
"(2) Paragraph (1) does not apply to the collection, compilation, or
transmittal of data in the course of a judicial proceeding.
"NONDISCRIMINATION
"SEC. 1918. (aXD For the purpose of applying the prohibitions 42 use 300x-7.
against discrimination on the basis of ajge under the Age Discrimina-
tion Act of 1975, on the basis of handicap under section 504 of the 42 use 6ioi
Rehabilitation Act of 1973, on the basis of sex under title IX of the gg^use 794
Education Amendments of 1972, or on the basis of race, color, or 20 use 1681
national origin under title VI of the Civil Rights Act of 1964, 42USe2000d.
programs and activities funded in whole or in part with funds made
available under this part are considered to be programs and activities
receiving Federal financial assistance.
"(2) No person shsill on the ground of sex or religion be excluded
from participation in, be denied the benefits of, or be subjected to
discrimination under, any program or activity funded in whole or in
part with funds made available under this part.
"(b) Whenever the Secretary finds that a State, or an entity that
has received a pajnnent from an allotment to a State under section
1912, has failed to comply with a provision of law referred to in
subsection (aXD, with subsection (aX2), or with an applicable regula-
tion (including one prescribed to carry out subsection (aX2)), the
Secretary shall notify the chief executive officer of the State and shall
request him to secure compliance. If within a reasonable period of
time, not to exceed sixty days, the chief executive officer fails or
refuses to secure compliance, the Secretary may—
"(1) refer the matter to the Attorney General with a recom-
mendation that an appropriate civU action be instituted,
"(2) exercise the powers and functions provided by title VI of
the Civil Rights Act of 1964, the Age Discrimination Act of 1975,
or section 504 of the Rehabilitation Act of 1973, as may be
applicable, or
(3) take such other action as may be provided by law.
"(c) When a matter is referred to the Attorney General pursuant to
subsection (bXD, or whenever he has reason to believe that a State or
an entity is engaged in a pattern or practice in violation of a provision
89-194 0—82 37 : QL3
95 STAT. 552 PUBLIC LAW 97-35—AUG. 13, 1981
of law referred to in subsection (aXD or in violation of subsection
(aX2), the Attorney General may bring a civil action in any appropri-
ate district court of the United States for such relief as may be
appropriate, including injunctive relief.
"CRIMINAL PENALTY FOR FALSE STATEMENTS
42 use 300X-8. "SEC. 1919. Whoever—
"(1) knowingly and willfuUjj^ makes or causes to be made any
false statement or representation of a material fact in connection
with the furnishing of items or services for which payment may
be made by a State from funds allotted to the State under thM
part, or
"(2) having knowledge of the occurrence of any event affecting
his initial or continued right to any such payment conceals or
fails to disclose such event with an intent fraudulently to secure
such pajrment either in a greater amount than is due or when no
such pa3maent is authorized,
shall be fined not more than $25,000 or imprisoned for not more than
five years, or both.
"TRANSITION PROVISION
42 use 300X-9. "SEC. 1920. If at the request of a State the Secretary uses the
allotment of the State during the transition period prescribed by title
Post, p. 753. XVII of the Omnibus Budget Reconciliation Act of 1981 for grants
under this part, the Secretary shall make the grants in accordance
with the requirements of paragraphs (6), (7), and (8) of section 1915(c).
The Secretary shsdl deduct from the allotment of the State the
amount the Secretary (after consultation with the State) requires to
fund such programs.'.
"PART C—PRIMARY CARE BLOCK GRANTS
"PLANNING GRANTS
42 use 300y. "SEC. 1921. (a) The Secretary may make grants to any State to
undertake planning and other administrative activities to enable the
State to administer allotments provided to it under this part. The
amount of any grant to a State shall be determined by the Secretary
but may not exceed $150,000.
"(b) No grant may be made under subsection (a) unless an applica-
tion therefore is submitted to, and approved by, the Secretary. Such
an application shall be submitted in such form and manner and shall
contain such information as the Secretary shall prescribe.
"(c) For grants under subsection (a), there are authorized to be
appropriated $2,500,000 for fiscal year 1982.
"AUTHORIZATION OF APPROPRIATIONS
42 use 300y-l. "SEC. 1922. For allotments under section 1924 and for grants under
section 330, there is authorized to be appropriated $302,500,000 for
fiscal year 1983, and $327,000,000 for fiscal year 1984.
42 u s e 254c. "GRANTS UNDER SECTION 330
42 use 300y-2. SEC. 1923, If a State does not submit an application for an allotment
under section 1924 for a fiscal year or does not qualify for such an
allotment for such fiscal year, the Secretary shall use funds appropri-
ated under section 1922 to make grants under section 330 to commu-
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 553
nity health centers within the State. Before making grants under
section 330 for community health centers within a State the Secre- 42 use 254c.
tary shall consult with the chief executive officer of the State and
with appropriate local officials. The amount of funds from appropri-
ations under section 1922 which may be used for grants for a fiscal
year under section 330 for community health centers shall be the
amount remaining after allotments are made under section 1924 for
suchfiscEilyear.
"ALLOTMENTS
"SEC. 1924 (a). If a State submits an application under section 1927 42 use 300y-3.
for an allotment for a fiscal year and is determined by the Secretary
to be eligible under such section for such an allotment, the Secretary
shall allot to such State from the amount appropriated under section
1922 for such fiscal year an amount which bears the same ratio to the
amount appropriated under section 1922 for that fiscal year as the
amount granted for fiscal year 1982 by the Secretary to community
health centers in the State under section 330 bore to the amount
granted for that fiscal year by the Secretary under such section to
centers in all States from appropriations for that fiscal year.
"(b)(1) If the Secretary—
"(A) receives a request from the governing body of an Indian
tribe or tribal organization within any State that funds under
this part be provided directly by the Secretary to such tribe or
organization, and
"(B) determines that the members of such tribe or tribal
organization would be better served by means of grants made
directly by the Secretary under this part,
the Secretary shall reserve from amounts which would otherwise be
allotted to such State under subsection (a) for the fiscal year the
amount determined under paragraph (2).
"(2) The Secretary shall reserve for the purpose of paragraph (1)
from amounts that would otherwise be allotted to such State under
subsection (a) an amount equal to the amount which bears the same
ratio to the State's allotment for the fiscal year involved as the total
amount granted for fiscal year 1982 by the Secretary to such tribe or
tribal organization under section 330 bore to the total amount
granted for such fiscal year by the Secretary to the State and entities
(including Indian tribes and tribal organizations) in the State under
section 330.
"(3) From the amount reserved by the Secretary on the basis of a
determination under this subsection, the Secretary shall make grants
under section 330 to the Indian tribe or tribal organization serving
the individuals for whom such a determination has been made.
"(4) The terms Indian tribe' and 'tribal organization' have the
same meaning given such terms in section 4(b) and section 4(c) of the
Indian Self-Determination and Education Assistance Act. 25 use 450b.
"PAYMENTS UNDER ALLOTMENTS TO STATES
"SEC. 1925. (aXD For each fiscal year, the Secretary shall make 42 use 300y-4.
payments, as provided by section 203 of the Intergovernmental
Cooperation Act of 1968 (42 U.S.C. 4213), from amounts appropriated
for allotments (other than any amount reserved under section
1924(b)) under section 1924(a) to each State which receives such an
allotment.
"(2) Any amount paid to a State for a fiscal year and remaining
unobligated at the end of such year shall remain available to such
95 STAT. 554 PUBLIC LAW 97-35—AUG. 13, 1981
State for the purposes for which it was made for the next fiscal year if
the Secretary determines that the State acted in accordance with
section 1926(a)(1) and there is good cause for funds remaining
unobligated.
"(b) The Secretary, at the request of a State, may reduce the
amount of payments under subsection (a) by—
"(1) the fair market value of any supplies or equipment
furnished to the State, and
"(2) the amount of the pay, allowances, and travel expenses of
any officer or employee of the Government when detailed to the
State and the amount of any other costs incurred in connection
with the detail of such officer or employee,
when the furnishing of supplies or equipment or the detail of an
officer or employee is for the convenience of and at the request of the
State and for the purpose of conducting activities described in section
1926. The amount by which any payment is so reduced shall be
available for payment by the Secretary of the costs incurred in
furnishing the supplies or equipment or in detailing the personnel, on
which the reduction of the payment is based, and the amount shall be
deemed to be part of the payment and shall be deemed to have been
paid to the State.
"GRANTS TO COMMUNITY HEALTH CENTERS
42 use 300y-5. "SEC. 1926. (a)(1) In fiscal years 1983 and 1984 each State shall use
for grants under paragraphs (2) and (3) the entire amount allotted to
it under section 1924 for such fiscal year and the entire amount
required to be made available under paragraph (4).
"(2) From the amounts paid to it under section 1925 for fiscal year
1983 and from the State funds required to be made available under
paragraph (4) for such fiscal year, each State shall make grants to
each community health center which received a grant for its oper-
42 use 254c. ation under section 330(d) for fiscal year 1982 and which meets the
requirements of this paragraph. A grant may be made under this
paragraph to a community health center only—
"(A) if the center has made an application to the State in
accordance with section 330(e), and
"(B) if the center meets the requirements for receiving a grant
under section 330 for its operation.
The amount of a grant under this paragraph to a center shall be not
less than the amount the center received under section 330(d) for
fiscal year 1982. If the State determines under subparagraph (B) that
a community health center which has applied for a grant does not
meet the requirements referred to in that subparagraph, the Secre-
tary shall review the State's determination. If the Secretary finds
that the center does not meet such requirements, the State may
withhold a grant to the center under this paragraph.
"(3) In fiscEil years 1983 and 1984, each State shall make grants to
community health centers within the State which serve medically
underserved populations and which meet the requirements of this
paragraph. A grant under this paragraph for fiscal year 1983 shall be
made from any amount not obligated under paragraph (2) or (4) for
such fiscal year, and a grant for fiscal year 1984 shall be made from
the amounts paid to it under section 1925 for the fiscal year and from
the State funds required to be made available under paragraph (4) for
the fiscal year. A grant may be made under this paragraph to a
community health center only—
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 555
"(A) if the center has made an application to the State in
accordance with section 330(e), and 42 use 254c.
"(B) if the center meets the requirements for receiving a grant
under section 330 for its operation.
The Umitation prescribed by section 330(gX3) shall apply with respect
to grants under this paragraph. States shall make grants under this
paragraph in such a manner that medically underserved populations
which have been served by community health centers and which are
still medically underserved populations will continue to receive
health care, and in making such grants a State shall not, to the extent
practicable, disrupt established provider-patient relationships.
"(4)(A) In fiscal year 1983 a State which receives an allotment
under section 1924 for that fiscal year shall make available, from
State funds, for the grants described in paragraphs (2) and (3) and for
State administrative expenses for such grants for such fiscal year an
amount equal to 20 percent of its allotment. In fiscal year 1984 a State
which receives an allotment under section 1924 for that fiscal year
shall make available, from State funds, for the grants described in
paragraphs (2) and (3) and for State administrative expenses for such
grants for such fiscal year an amount equal to one-third of its
allotment.
"(B) A State, at the request of a community heedth center, may
reduce the amount of the State's contribution under subparagraph
(A) to the center by—
"(i) the fair market value of any supplies or equipment fur-
nished to the center, and
"(ii) the amount of the pay, allowances, and travel expenses of
any officer or employee of the State when detailed to the center
and the amount of any other costs incurred in connection with
the detail of such officer or employee,
when the furnishing of supplies or equipment or the detail of an
officer or employee is for the convenience of and at the request of the
center and for the purpose of activities centers assisted under this
section. The amount by which any payment is so reduced shall be
available for pa5mient by the State of the costs incurred in furnishing
the supplies or equipment or in detailing the personnel, on which the
reduction of the payment is based, and the amount shall be deemed to
be part of the payment and shall be deemed to have been paid by the
State under subparagraph (A).
"(5) A State may not use any funds paid to it under section 1925 for
the purposes of administration of the grants required by paragraphs
(2) and (3).
"(6) For purposes of this part—
"(A) the term 'community health center' has the same mean- "Community
ing as that term has under section 330(a), and health center.
'(B) a medically underserved population is such a population
designated by the Secretary under section 330(b)(3).
"(b) A State may not use amounts paid to it under section 1925 to—
"(1) provide inpatient services, except in fiscal year 1983 in the
case of a community health center which used funds provided
under section 330 for fiscal year 1982 to provide such services,
"(2) make cash payments to intended recipients of health
services,
"(3) purchase or improve land, purchase, construct, or perma-
nently improve (other than minor remodeling) any building or
other facility, or purchase major medical equipment,
"(4) satisfy any requirement for the expenditure of non-
Federal funds as a condition for the receipt of Federal funds, or
95 STAT. 556 PUBLIC LAW 97-35—AUG. 13, 1981
"(5) provide financial assistance to any entity other than a
public or nonprofit private community health center.
The Secretary may waive the limitation contained in paragraph (3)
upon the request of a State if the Secretary finds that there are
extraordinary circumstances to justify the waiver and that granting
the waiver will assist in carrying out this part. The prohibition
prescribed by this subsection (other than paragraph (4)) shall apply
with respect to any amount required to be made available under
subsection (aX4).
"APPUCATION; ASSURANCES; DESCRIPTION OF ACTIVITIES
42 use 300y-6. "SEC. 1927. (a) No state may receive an allotment for a fiscal year
under section 1924(a) unless an application therefor has been submit-
ted to and approved by the Secretary. Such an application shall be
submitted before the beginning of the fiscal year for which the
allotment applied for will be made. Each such application shall be in
such form and submitted by such date as the Secretary shall require.
Each such application shall contain assurances that the legislature of
the State has complied with the provisions of subsection (b) and that
the State will meet the requirements of subsection (c).
"(b) After the expiration of the first fiscal year in which a State
receives an allotment under section 1924, no funds shall be allotted to
such State for any fiscal year under such section unless the legisla-
ture of the State conducts public hearings on the proposed use and
distribution of funds to be provided under section 1925 for such fiscal
year.
"(c) As part of the annual application required by subsection (a), the
chief executive officer of each State shall certify that the State
agrees—
"(1) to use the funds alloted to it under section 1924 in
accordance with the requirements of section 1926; and
"(2) to establish, after providing reasonable notice and opportu-
nity for the submission of comments, reasonable criteria to
evaluate the fiscal, managerial, and clinical performance of
community health centers; and
"(3) to establish procedural and substantive independent State
review procedures relating to the failure by the State to provide
funds for any such center and to the reduction of the funds paid
to a community health center in fiscal year 1984 to an amount
which is significantly less than the amount paid to the center by
the State under section 1926 in fiscal year 1983.
The application of a State shall also contain assurances, satisfactory
to the Secretary, that the State has the administrative capability to
administer grants under section 1926, to determine the need for
services of community health centers by medically underserved
populations, and to evaluate the performance of community health
centers.
"(d)(1) The chief executive officer of the State shall, as part of the
application required by subsection (a), prepare and furnish to the
Secretary (in accordance with such form as the Secretary shall
provide) a description of the intended use of the payments the State
will receive under section 1925 for that fiscal year and the funds the
State is required to obligate under section 1926(a)(4) for that fiscal
year.
"(2) The description required by paragraph (1) shall be made public
within the State in such manner as to facilitate comment from any
person (including any Federal or other public agency) during develop-
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 557
ment of the description and after its transmittal. The description
shall be revised (consistent with this section) throughout the year as
may be necessary to reflect substantial changes in the programs and
activities assisted under this part, and any revision shall be subject to
the requirements of the preceding sentence.
"REPORTS AND AUDITS
"SEC. 1928. (a)(1) Each State shall prepare and submit to the 42USC300y-7.
Secretary annual reports on its activities under this part. Such
reports shall be in such form and contain such information as the
Secretary determines (after consultation with the States and the
Comptroller General) to be necessary (A) to determine whether funds
were expended in accordance with sections 1926 and 1927(c), (B) to
secure a description of the activities under this part, and (C) to secure
a record of the purposes for which funds were spent, of the recipients
of such funds and of the progress made toward achieving the purposes
for which the funds were provided. Copies of the report shall be
provided, upon request, to any interested person (including any
public agency).
"(2) In determining the information that States must include in the
report required by this subsection, the Secretary may not establish
reporting requirements which are burdensome.
"(b)(1) Each State shall establish fiscal control and fund accounting
procedures as may be necessary to assure the proper disbursal of and
accounting for Federal funds paid to the State under section 1925.
"(2) Each State shall annually audit its expenditures from pay-
ments received under section 1925. Such State audits shall be
conducted by an entity independent of any agency administering a
program funded under this part and, to the extent practicable, in
accordance with the Comptroller's General standards for auditing
governmental organizations, programs, activities, and functions.
Within 30 days following the date each audit is completed, the chief
executive officer of the State shall transmit a copy of that audit to the
Secretary.
"(3) Each State shall, after being provided by the Secretary with
adequate notice and opportunity for a hearing within the affected
State, repay to the United States amounts found not to have been
expended in accordance with the requirements of section 1926 or the
certification and assurances provided under section 1927. If such
repayment is not made, the Secretary shall, after providing the State
with adequate notice and opportunity for a hearing, offset such
amounts against the amount of any allotment to which the State is or
may become entitled under section 1924.
"(4) The State shall make copies of the reports and audits required Public
by this section available for public inspection within the State, inspection.
"(5) The Comptroller General of the United States shall, from time
to time, evaluate the expenditures by States of grants under this part
in order to assure that expenditures are consistent with the provi-
sions of this part.
"(6) Not later than January 1, 1984, the Secretary shall report to
the Congress on the activities of the States which have received funds
under this part and may include in the report any recommendations
for appropriate changes in legislation.
95 STAT. 558 PUBLIC LAW 97-35—AUG. 13, 1981
WITHHOLDING
Notice and "SEC. 1929. (a)(1) The Secretary shall, after adequate notice and an
hearing. opportunity for a hearing conducted within the affected State and
42 u s e 300y-8. subject to paragraphs (2) and (3) of this subsection, withhold funds
from any State which does not use its allotment in accordance with
the requirements of section 1926 or 1927. The Secretary shall with-
hold such funds until the Secretary finds that the reason for the
withholding has been removed and there is reasonable assurance
that it will not recur. If the Secretary withholds funds from a State
for its failure to provide grants to community health centers in
accordance with section 1926, the Secretary shall use the funds
withheld to make such grants in accordance with such section.
"(2) The Secretary may not institute proceedings to withhold funds
under this section unless the Secretary has conducted an investiga-
tion concerning whether the State has used its allotment in accord-
ance with this part. Investigations required by this paragraph shall
be conducted within the affected State by qualified investigators.
"(3) The Secretary may not withhold funds under this subsection
from a State for a minor failure to comply with the provisions of this
part.
"(4) The Secretary shall respond in an expeditious manner to
complaints of a substantial or serious nature that a State has failed to
use funds in accordance with the requirements of this part.
"(b)(1) The Secretary shall conduct in several States in each fiscal
year investigations of the use of funds received by the States under
this part in order to evaluate compliance with the requirements of
this part.
"(2) The Comptroller General of the United States may conduct an
investigation of the use of funds received under this part by a State in
order to insure compliance with the requirements of this part.
"(c) A State shall make appropriate books, documents, papers, and
records available to the Secretary or the Comptroller General of the
United States, or any of their duly authorized representatives, for
examination, copying, or mechanical reproduction on or off the
premises of the appropriate entity upon a reasonable request
therefor.
"(d)(1) In conducting any investigation, the Secretary or the Comp-
troller General of the United States may not request any information
not readily available to such State or to any community health center
which has received a grant under this part and may not make an
unreasonable request for information to be compiled, collected, or
transmitted in any form not readily available.
"(2) Paragraph (1) does not apply to the collection, compilation, or
transmittal of data in the course of a judicial proceeding.
NONDISCRIMINATION
42 u s e 300y-9. "SEC. 1930. (aXl) For the purpose of applying the prohibitions
against discrimination on the basis of age under the Age Discrimina-
42 u s e 6101 tion Act of 1975, on the basis of handicap under section 504 of the
note. Rehabilitation Act of 1973, on the basis of sex under title IX of the
29 u s e 794. Education Amendments of 1972, or on the basis of race, color, or
20 u s e 1681. national origin under title VI of the Civil Rights Act of 1964,
42 u s e 2000d. programs and activities funded in whole or in part with funds made
available under this part are considered to be programs and activities
receiving Federal financial assistance.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 559
"(2) No person shall on the ground of sex or religion be excluded
from participation in, be denied the benefits of, or be subjected to
discrimination under, any program or activity funded in whole or in
part with funds made available under this part.
"(b) Whenever the Secretary finds that a State or an entity that has
received a pa3niient from an allotment to a State under section 1924
has failed to comply with a provision of law referred to in subsection
(aXD, with subsection (a)(2), or with an applicable regulation (includ-
ing one prescribed to carry out subsection (aX2)), the Secretary shall
notify the chief executive officer of the State and shall request him to
secure compliance. If within a reasonable period of time, not to
exceed sixty days, the chief executive officer fails or refuses to secure
compliance, the Secretary may—
"(1) refer the matter to the Attorney General with a recom-
mendation that an appropriate civil action be instituted,
"(2) exercise the powers and functions provided by title VI of
the Civil Rights Act of 1964, the Age Discrimination Act of 1975, 42 use 2000d.
or section 504 of the Rehabilitation Act of 1973, as may be 42 use 6ioi
applicable, or "°*®
"(3) take such other action as may be provided by law. ^^ ^^^ ^^'*-
"(c) When a matter is referred to the Attorney General pursuant to
subsection (bXD, or whenever he has reason to believe that a State or
an entity is engaged in a pattern or practice in violation of a provision
of law referred to in subsection (aXD or in violation of subsection
(a)(2), the Attorney General may bring a civil action in any appropri-
ate district court of the United States for such relief as may be
appropriate, including injunctive relief.
"CRIMINAL PENALTY FOR FALSE STATEMENTS
"SEC. 1931. Whoever— 42 use 300y-io.
"(1) knowingly and willfully makes or causes to be made any
false statement or representation of a material fact in connection
with the furnishing of items or services for which payment may
be made by a State from funds allotted to the State under this
part, or
"(2) having knowledge of the occurrence of any event affecting
his initial or continued right to any such payment conceals or
fails to disclose such event with an intent fraudulently to secure
such payment either in a greater amount than is due or when no
such payment is authorized,
shall be fined not more than $25,000 or imprisoned for not more than
five years, or both.
' 'ADMINISTRATION
"SEC. 1932. Title XVII of the Omnibus Budget Reconciliation Act of 42 use 300y-li.
1981 shall not apply with respect to the grant program authorized by Post, p. 753.
this part.".
REPEALS AND CONFORMING AMENDMENTS
SEC. 902. (a) Sections 401 and 402 of the Health Services and
Centers Amendments of 1978 are repealed. 42 use 247b-i,
(b) Sections 314(d) and subpart III of part D of title III of the Public ^^'^''"^
Health Service Act are repealed. 42 use 246, 255.
(cXD The second sentence of section 311(a) of the Public Health
Service Act is amended— 42 use 243.
(A) by inserting "and with respect to other public health
matters" after "diseases", and
95 STAT. 560 PUBLIC LAW 97-35—AUG. 13, 1981
(B) by striking out "and in carrying out the purposes of section
42 u s e 243. 314".
42 u s e 246. (2) The first sentence of section 311(b) of such Act is amended by
striking out "the purposes of section 314" and inserting in lieu
thereof "public health activities".
Repeals. (d)(1) Sections 1201, 1202, 1203, 1204, 1205(d), 1206, 1207(a), 1208,
42 use 1209, and 1210, and part B of title XII of the Public Health Service Act
300d-300d-9, are repealed.
300d-21. (2) Title XII of such Act is amended by striking out—
"PART A—ASSISTANCE FOR EMERGENCY MEDICAL SERVICES
SYSTEMS".
42 use 300d-4. (3) Section 1205 of such Act is redesignated as section 1201.
42 use 300d-6. (4) Section 1207(b) of such Act is redesignated as section 1202.
42 use 201. (5) Section 2(f) of such Act is amended by striking out "1201(2),".
Repeals (e)(1) Section 101, part B of title I, titles II and III, and sections 502,
94 Stat. 1564. 602, 801, and 806 of the Mental Health Systems Act are repealed.
42 use 9411. (2)(A) Section 225 of the Community Mental Health Centers Act is
42 use 9421.
42 use 9431. transferred to title V of the Public Health Service Act, inserted after
42 use 9451. section 514, redesignated as section 515, and amended (A) by striking
42 use 9502. out "this title" and inserting in lieu thereof "the Community Mental
42 use 9512.
42 use 9521. Health Centers Act" and (B) by inserting "of the Community Mental
42 use 9523. Health Centers Act" after "section 222".
42 use 229d, (B) The (Community Mental Health Centers Act is repealed.
2689m. (f)(1) Title I of the Mental Health Systems Act is amended—
Repeal.
42 use 2689 (A) by striking out "PART A—DEFINITIONS";
note. 9411.
(B) by striking out "OTHER" in the section heading for section
42 u s e 9412. 102; and
42 u s e (C)) by striking out paragraphs (3), (4), (6), and (7) of section 102,
and by redesignating paragraph (5) of such section as paragraph
(3).
(2) The table of contents in the first section of such Act is amended
by striking out the items relating to sections 101, 105, 106, 107, 201
through 208, 301 through 303, 305 through 309, 315 through 317, 321,
325 through 328,502,602,801, and 806, parts A and B of title I, title II,
title III, and parts A, B, C, D, and E of title III.
(3) The table of section 102 in such table of contents is amended to
read as follows:
"Sec. 102. Definitions.".
94 Stat. 1602. (20) Section 601(a) of such Act is amended—
42 use 9511.
(A) by striking out "community mental health centers and
other" in paragraph (5); and
(B) by striking out paragraph (6).
(g)(1) The second sentence of section 455(a) of the Public Health
94 Stat. 1608. Service Act is amended by striking out ", the Mental Retardation
42 use 289k-l. Facilities and Community Mental Health Centers Construction Act
of 1963 (other than part C of title II), and the Mental Health Systems
Act".
42 use 225a. (2) Section 507 of such Act is amended by striking out ", appropri-
ations available under the Community Mental Health Centers Act
for construction and staffing of community mental health centers
and alcoholism and narcotic addiction, drug abuse, and drug depend-
ence facilities,".
42 use 229b. (3) Section 513 of such Act is amended by striking out "the Mental
Retardation Facilities Construction Act, the Community Mental
Health Centers Act,".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 561
(4) Section 1513(e)(l)(A)(i) of such Act is amended by striking out ", 9| Stat. 1608.^
the Community Mental Health Centers Act, the Mental Health
Systems Act, sections 409 and 410 of the Drug Abuse Prevention,
Treatment, and Rehabilitation Act, or the Comprehensive Alcohol
Abuse and Alcoholism Prevention, Treatment, and Rehabilitation
Act of 1970".
(5) Section 1521(dX2)(A) of such Act is amended— 42 u s e 300m.
(A) by striking out ", the Community Mental Health Centers
Act," and inserting in lieu thereof "or"; and
(B) by striking out", and the Drug Abuse Office and Treatment
Act of 1972".
(6) Section 1524(c)(6XA) of such Act is amended by striking out "the 94 Stat. 3191.
Community Mental Health Centers Act, section 409 or 410 of the 42 u s e 300m-3.
Drug Abuse Office and Treatment Act of 1972, or the Comprehensive
Alcohol Abuse and Alcoholism Prevention, Treatment, and Rehabili-
tation Act of 1970,".
(h) The amendments made by this section sheill take effect October 1, Effective date.
1981. 42 u s e 229d
note.
ONE-YEAR EXTENSION OF COMMUNITY HEALTH CENTERS AND PRIMARY
CARE RESEARCH AND DEMONSTRATIONS
SEC. 903. (a) The first sentence of section 330(g)(2) (42 U.S.C.
254c(g)(2)) of the Public Health Service Act is amended by striking out
"and" after "1980," and by striking out the period and inserting in
lieu thereof the following: "and $280,000,000 for the fiscal year ending
September 30,1982. For authorizations for appropriations for fiscal
years 1983 and 1984, see section 1922.", Ante, p. 552.
(b)(1) Section 340(g)(2) of the Public Health Service Act (42 U.S.C.
256(g)(2)) is amended by striking out "and" after "1980," and by
striking out the period and inserting in lieu thereof the following:
"and $3,000,000 for the fiscal year ending September 30, 1982. No
funds may be appropriated under this paragraph or paragraph (1) for
a fiscal year beginning after September 30,1982.".
(c) Effective October 1, 1982, section 340 of such Act is repealed. Repeal.
SERVICES TO MIGRANTS BY COMMUNITY HEALTH CENTERS
SEC. 904. The Secretary of Health and Human Services shall review
the performance of community health centers which have received
grants under section 329 of the Public Health Service Act (relating to 42 use 254b.
migrant health centers) to determine if the community health
centers have provided services to migrants in a manner which is
consistent with the needs of the migrants. In determining if the
services have been provided in such a manner, the Secretary shall
consider the hours of operation of a center, the bilingual capabilities
of a center's staff, and the ability of the center's staff to detect, report,
and treat adverse health effects resulting from exposure to pesticides.
The Secretary shall report the results of the review conducted under Report to
this section to the Congress not later than six months after the date of eongress.
the enactment of this section and shall include in the report actions
taken by the Secretary to assure that community health centers
receiving grants under such section 329 will provide services to
migrants in a manner consistent with their needs.
95 STAT. 562 PUBLIC LAW 97-35—AUG. 13, 1981
CRITERIA FOR DETERMINING AREAS AND POPULATION GROUPS IN NEED
OF SERVICES OF COMMUNITY HEALTH CENTERS
SEC. 905. (a) Section 330(bX3) of the Public Health Service Act (42
U.S.C. 254c(b)(3)) is amended by adding at the end the following:
Ante, p. 535. "After the date of the enactment of part A of title XIX, the Secretary
may not designate a medically underserved population or remove the
designation of such a population unless the Secretary provides
reasonable notice and opportunity for comment and consults with the
chief executive officer of the State in which the population is located
and appropriate local officials. The Secretary shall prescribe criteria
for determining the specific shortages of personal health services of
an area or population group. Such criteria shall include infant
mortality in an area or population group, other factors indicative of
the health status of a population group or residents of an area, the
ability of the residents of an area or of a population group to pay for
health services and their accessibility to them, and the availability of
health professionals to residents of an area or to a population group.".
G)) Section 330(e)(2) of such Act is amended by inserting before the
second sentence the following: "Such an application shall also include
a demonstration by the applicant that the area or a population group
to be served by the applicant has a shortage of personal health
services and that the center will be located so that it will provide
services to the greatest number of persons residing in such area or
included in such population group. Such a demonstration shall be
made on the basis of the criteria prescribed by the Secretary under
subsection (b)(3) or on any other criteria which the Secretary may
prescribe to determine if the area or population group to be served by
the applicant has a shortage of personal health services.".
AUDITS OF GRANTS TO COMMUNITY HEALTH CENTERS
SEC. 906. Section 330 of the Public Health Service Act (42 U.S.C.
254c) is amended by adding at the end the following:
"(hXD Each entity which receives a grant under subsection (d) shall
provide for an independent annual financial audit of any books,
accounts, financial records, files, and other papers and property
which relate to the disposition or use of the funds received under such
grant and such other funds received by or allocated to the project for
which such grant was made. For purposes of assuring accurate,
current, and complete disclosure of the disposition or use of the funds
received, each such audit shall be conducted in accordance with
generally accepted accounting principles. Each audit shall evaluate—
"(A) the entity's implementation of the guidelines established
by the Secretary respecting cost accounting,
"(B) the processes used by the entity to meet the financial and
program reporting requirements of the Secretary, and
"(C) the billing and collection procedures of the entity and the
relation of the procedures to its fee schedule and schedule of
discounts and to the availability of health insurance and public
programs to pay for the health services it provides.
A report of each such audit shall be filed with the Secretary at such
time and in such manner as the Secretary may require.
Recordkeeping. "(2) Each entity which receives a grant under subsection (d) shall
establish and maintain such records as the Secretary shall by
regulation require to facilitate the audit required by paragraph (1).
The Secretary may specify by regulation the form and manner in
which such records shall be established and maintained.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 563
"(3) Each entity which is required to establish and maintain
records or to provide for an audit under this subsection shall make
such books, documents, papers, and records available to the Secretary
or the Comptroller General of the United States, or any of their duly
authorized representatives, for examination, copying, or mechanical
reproduction on or off the premises of such entity upon a reasonable
request therefor. The Secretary and the Comptroller General of the
United States, or any of their duly authorized representatives, shall
have the authority to conduct such examination, copying, and repro-
duction.
"(4) The Secretary may, under appropriate circumstances, waive
the application of all or part of the requirements of this subsection to
a community health center.".
Subtitle B—Developmental Disabilities
EXTENSION OF PROGRAMS
SEC. 911. (a) The first sentence of section 113(b)(2) of the Develop-
mental Disabilities Assistance and Bill of Rights Act (hereinafter in
this subtitle referred to as the "Act") (42 U.S.C 6012(b)(2)) is amended
by striking out "and" after "1980," and by inserting before the period
a comma and the following: "$8,000,000 for the fiscal year ending
September 30, 1982, $8,000,000 for the fiscal year ending September
30, 1983, and $8,000,000 for the fiscal year ending September 30,
1984".
(b) Section 123(a) of the Act (42 U.S.C. 6033(a)) is amended by
striking out "and" after "1980," and by inserting before the period a
comma and the following: "$7,500,000 for the fiscal year ending
September 30, 1982, $7,500,000 for the fiscal year ending September
30, 1983, and $7,500,000 for the fiscal year ending September 30,
1984".
(c) Section 131 of the Act (42 U.S.C. 6061) is amended by striking out
"and" after "1980," and by inserting before the period a comma and
the following: "$43,180,000 for the fiscal year ending September 30,
1982, $43,180,000 for the fiscal year ending September 30, 1983, and
$43,180,000 for thefiscalyear ending September 30,1984".
EVALUATION SYSTEM
SEC. 912. (a) Section 110 of the Act (42 U.S.C. 6009) is repealed. Repeal.
SPECIAL PROJECT GRANTS
SEC. 913. Section 145 of the Act (42 U.S.C. 6081) is amended to read
as follows:
" G R A N T AUTHORITY
"SEC. 145. (a) The Secretary may make grants to public or nonprofit
private entities for—
"(1) demonstration projects—
"(A) which are conducted in more than one State,
"(B) which involve the participation of two or more Feder-
al departments or agencies, or
"(C) which are otherwise of national significance,
and which hold promise of expanding or otherwise improving
services to persons with developmental disabilities (especially
those who are disadvantaged or multihandicapped); and
95 STAT. 564 PUBLIC LAW 97-35—AUG. 13, 1981
"(2) demonstration projects (including research, training, and
evaluation in connection with such projects) which hold promise
of expanding or otherwise improving protection and advocacy
services relating to the State protection and advocacy system
42 u s e 6012. described in section 113.
Projects for the evaluation and assessment of the quality of services
provided persons with developmental disabilities which meet the
requirements of subparagraphs (A), (B), and (C) of paragraph (1) may
be included £is projects for which grants are authorized under such
paragraph.
"(b) No grant may be made under subsection (a) unless an applica-
tion therefor has been submitted to, and approved by, the Secretary.
Such application shall be in such form, submitted in such manner,
and contain such information as the Secretary shall by regulation
prescribe. The Secretary may not approve such an application unless
each State in which the applicant's project will be conducted has a
42 u s e 6063. State plan approved under section 133. The Secretary shall provide to
the State Planning C!ouncil (established under section 137) for each
42 u s e 6067. State in which an applicant's project will be conducted an opportuni-
ty to review the application for such project and to submit its
comments on the application.
"(c) Pa3rments under grants under subsection (a) may be made in
advance or by way of reimbursement, and at such intervals and on
such conditions, as the Secretary finds necessary. The amount of any
grant under subsection (a) shall be determined by the Secretary.
Appropriation "(d) For the purpose of grants under subsection (a), there are
authorization. authorized to the appropriated $2,500,000 for the fiscal year ending
September 30, 1982, $2,500,000 for the fiscal year ending September
30, 1983, and $2,500,000 for the fiscal year ending September 30,
1984.".
Subtitle C—Health Services Research, Statistics, and
Technology; Medical Libraries; and National Re-
search Service Awards
REFERENCES IN SUBTITLE
SEC. 916. Whenever in this subtitle an amendment or repeal is
expressed in terms of an amendment to, or a repeal of, a section or
other provision, the reference shall be considered to be made to a
42 u s e 201 note. section or other provision of the Public Health Service Act.
AUTHORIZATIONS FOR HEALTH SERVICES RESEARCH, STATISTICS, AND
TECHNOLOGY
SEC. 917. (a) The first sentence of section 308(i)(l) (42 U.S.C.
242m(i)(l)) is amended by striking out "and" after "1980," and by
inserting before the period a comma and the following: "$20,000,000
for the fiscal year ending September 30, 1982, $22,000,000 for the
fiscal year ending September 30, 1983, and $24,000,000 for the fiscal
year ending September 30,1984".
(b) Section 308(i)(2) is amended by striking out "and" after "1980,"
and by inserting before the period a comma and the following:
"$39,000,000 for the fiscal year ending September 30, 1982,
$39,000,000 for the fiscal year ending September 30, 1983, and
$39,000,000 for the fiscal year ending September 30,1984".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 565
(cXD The first sentence of section 309(i) (42 U.S.C. 242n(i)) is
amended by striking out "and" after "1980," and by inserting before
the period a comma and the following: "$3,000,000 for the fiscal year
ending September 30, 1982, $4,000,000 for the fiscal year ending
September 30,1983, and $5,000,000 for the fiscal year ending Septem-
ber 30,1984".
(2) The second sentence of such section is amended by striking out
"the fiscal year ending September 30, 1981," and inserting in lieu
thereof "for each of the fiscal years ending September 30, 1982,
September 30,1983, and September 30,1984,".
GENERAL AUTHORITIES
SEC. 918. (a) Section 304(a)(3) (42 U.S.C. 242b(a)(3)) is amended—
(1) by striking out "shall" and inserting in lieu thereof "may",
and
(2) by striking out "and" the first three places it occurs and
inserting in lieu thereof "or".
(b)(1) The first sentence of section 304(d)(1) is amended by striking
out "and the National Academy of Sciences (acting through the
Institute of Medicine and other appropriate units) shall, jointly and"
and inserting in lieu thereof ", with the advice and assistance of the
National Academy of Sciences (acting through the Institute of Medi-
cine and other appropriate units), shall,".
(2) The second sentence of such section is amended by striking out
"and the National Academy of Sciences (hereinafter in this subsec-
tion referred to as the 'Academy')".
(3) Section 304(d)(3) is amended by striking out "and the Academy"
each place it appears.
(c) Section 304(d)(3) is amended by striking out "every two years"
and inserting in lieu thereof "every three years".
(d)(1) Subsections (b)(1) and (c)(1) of section 304 are each amended by
striking out "Health, Education, and Welfare" and inserting in lieu
thereof "Health and Human Services".
(2) Subsection (d)(3) of such section is amended by striking out
"Committee on Interstate and Foreign Commerce" and inserting in
lieu thereof "Committee on Energy and Commerce".
NATIONAL CENTER FOR HEALTH SERVICES RESEARCH
SEC. 919. (a)(1) The first sentence of section 305(d)(1) (42 U.S.C.
242c(d)(l)) is amended by striking out "health services, research,
evaluations" and inserting in lieu thereof "health services research,
evaluations, training, policy analysis,".
(2)(A) The second sentence of such section is amended (i) by striking
out "six of such centers" and inserting in lieu thereof "three of such
centers", and (ii) by striking out "three national special emphasis
centers" and all that follows through "health care delivery;" and
inserting in lieu thereof "two national special emphasis centers,".
(B) Section 308(i)(l) (42 U.S.C. 242m(i)(l)) (as amended by section
917(a) of this Act) is further amended by adding at the end thereof the
following new sentence: "Of the amounts appropriated under this
paragraph for each of the fiscal years ending September 30, 1982,
September 30, 1983, and September 30, 1984, not more than
$1,500,000 may be used for grants and contracts for all the costs of
planning, establishing, and operating centers under section 305(d)."
95 STAT. 566 PUBLIC LAW 97-35—AUG. 13, 1981
42 use 242c. (3) Section 305(dX2)(BXiv) is amended by striking out "demonstra-
tions, and evaluations" and inserting in lieu thereof "evaluations,
policy analysis, and demonstrations".
(bXD Paragraph (4) of section 305(b) is amended to read as follows:
"(4) the role of market forces in the health care system and the
appropriate role they may play in restraining cost increases and
improving the availability and quality of care.".
42 use 242c (2) The amendment made by paragraph (1) shall apply with respect
^°^- to grants made under section 305(b) of the Public Health Service Act
for fiscal years beginning after September 30,1981, except that if an
entity received a grant under paragraph (4) of such section, as in
effect before the date of the enactment of this Act, for the fiscal year
ending September 30, 1981, the Secretary may, until the fiscal year
be^nning October 1,1983, make an additional grant or grants to such
entity for the purposes prescribed by such paragraph as so in effect.
(c) Section 305(b) is amended by adding after and below paragraph
(4) the following: "No grant or contract shall be made under this
subsection for the purpose of funding clinical research that is directly
related to determining the cause of any disease or disorder or clinical
research that is directly and principally designed to evaluate the
efficacy of any therapeutic, diagnostic, or preventive health meas-
ure.".
(d) Subsections (a) and (c) of section 305 are each amended by
striking out "Health, Education, and Welfare" and inserting in lieu
thereof "Health and Human Services".
NATIONAL CENTER FOR HEALTH STATISTICS
SEC. 920. (a) Section 306(eX3) (42 U.S.C. 242k(eX3)) is amended by
inserting "and other activities" after "data collection".
(b) The first sentence of section 306(1X2)(A) is amended by striking
out "the Center" and inserting in lieu thereof "the Center and in
cooperation with the Office of Federal Statistical Policy and Stand-
ards".
(c) Section 306(1X2XD) is amended by striking out all after "subpara-
graph (A)" and inserting in lieu thereof a period.
(dXD Subsections (a), (eX4), (j), (kX4)(C), (kX4XD), and (lX2XB)(v) of
section 306 are each amended by striking out "Health, Education,
and Welfare" and inserting in lieu thereof "Health and Human
Services".
(2) Subsection (c) of such section is amended by striking out
"Committee on Interstate and Foreign Commerce" and inserting in
lieu thereof "Committee on Energy and Commerce".
INTERNATIONAL COOPERATION
42 use 242/. SEC. 921. (a) Section 307(a) (42 U.S.C. 2421(a)) is amended (1) by
striking out "and the" and inserting in lieu thereof ", health care
technology, and the", and (2) by striking out "and 306" and inserting
in lieu thereof "306, and 309".
Ot)) Section 307(b) is amended—
(1) in paragraph (5), by striking out "or health statistics" and
inserting in lieu thereof ", health statistics, or health care
technology", and
(2) in paragraph (6), by striking out "and programs of biomedi-
cal research, health services research, and health statistical
activities" and inserting in lieu thereof "or programs of biomedi-
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 567
cal research, health services research, health statistical activi-
ties, or health care technology activities".
GENERAL PROVISIONS
SEC. 922. (a) Section 308(aX2) (42 U.S.C. 242m(a)(2)) is amended by
striking out "September 1" and inserting in lieu thereof "December
1".
(b) Section 308(b)(2) is amended by striking out "$35,000" and
inserting in lieu thereof "$50,000".
(c) Section 308(dX2) is amended by inserting "or in the course of
health care technology activities under section 309" after "305".
NATIONAL CENTER FOR HEALTH CARE TECHNOLOGY
SEC. 923. (a) Section 309(bXl) (42 U.S.C. 242n(bXl)) is amended by
adding at the end thereof the following new sentence: "In carrying
out this section, the Center shall not unreasonably inhibit the
innovation of new technologies."
(b) Section 309(bX5) is amended by striking out "may" and inserting
in lieu thereof "shall" and by adding at the end thereof the following
new sentence: "The making of such recommendations shall be a
priority of the Center."
(c) Section 309(e) is amended by adding at the end thereof the
following new sentence: "In carrying out this section, the Secretary
shall ensure that the Center does not duplicate the activities of other
units of the Department of Health and Human Services or, to the
extent practicable, the activities of other Federal departments and
agencies. To ensure necessary coordination, all assessments, re-
search, evaluations, and demonstrations conducted by the Center
shall take into consideration relevant studies and activities under-
taken by the National Institutes of Health, the Food and Drug
Administration, the Center for Disease Control, the Alcohol, Drug
Abuse, and Mental Health Administration, and other Federal de-
partments and agencies."
(d) Sections 309(d) and 309(fXl)(B) are each amended by striking out
"$35,000" and inserting in lieu thereof "$50,000".
(e) Section 309(fKlXB) is amended by striking out "in excess o f and
inserting in lieu thereof "the direct costs of which will exceed".
(f)(1) Subparagraph (D) of section 309(fKl) is amended by striking
out "exemplary standards, norms, and criteria" and inserting in lieu
thereof "information".
(2) Subparagraph (E) of such section is amended by striking out
"standards, norms, and criteria" and inserting in lieu thereof "infor-
mation".
(g) Section 309(fK2XA) is amended by striking out "and the head of
the Health Care Financing Administration (or the successor to such
entity) who (or their designees) shall be ex officio members" and
inserting in lieu thereof "the head of the Health Care Financing
Administration (or the successor to such entity), and such other
Federal officials as the Secretary may specify, who (or their desig-
nees) shall be nonvoting ex officio members".
(h) The third sentence in the matter following section 309(f)(2XB) is
amended by striking out "two" and inserting in lieu thereof "three".
(iXD Clauses (1) and (2) of section 309(f)(6) are redesignated as
clauses (A) and (B), respectively.
89-194 O—82 38:QL3
95 STAT. 568 PUBLIC LAW 97-35—AUG. 13, 1981
42 use 242n. (2) Subsections (a) and (g) of section 309 are each amended by
striking out "Health, Education, and Welfare" and inserting in lieu
thereof "Health and Human Services".
(j) Section 309(fK7) is amended by striking out "1981" and inserting
in lieu thereof "1984".
(k) Subsection (g) of section 309 is repealed and subsections (h) and
(i) are redesignated as subsections (g) and (h), respectively.
NATIONAL RESEARCH SERVICE AWARDS
SEC. 924. (aXD Section 472(aXlXA) (42 U.S.C. 2891-l(aXlXA)) is
amended—
(A) by inserting "and" after the comma in clause (iii);
(B) by striking out clauses (iv), (v), and (vi);
(C) by redesignating clause (vii) as clause (iv); and
(D) by striking out "and the research described in clause (vi)"
in clause (iv) (as redesignated by subparagraph (C) of this
paragraph).
(2) Section 472(aX3) is amended to read as follows:
"(3) In awarding National Research Service Awards under this
section, the Secretary shall take account of the Nation's overall need
for biomedical research personnel by giving special consideration to
physicians who agree to undertake a minimum of two years of
bioiTifidicdl. rGSfiS-rch
(bXD Section 472(bXlXC) is amended by striking out "or
(aXlXAXiv)".
(2) Section 472(bX2) is amended by striking out "Health, Education,
jand Welfare" and inserting in lieu thereof "Health and Human
Services".
(3) The first sentence of section 472(bX5) is amended by inserting a
comma and "tuition, fees," after "stipends".
(cXD Section 472(cXl) is am^ended to read as follows:
"(cXD Each individual who is awarded a National Research Service
Award (other than an individual who is a prebaccalaureate student
who is awarded a National Research Service Award for research
training) shall, in accordance with paragraph (3), engage in health
research or teaching or any combination thereof which is in accord-
ance with the usual patterns of academic employment, for a period
computed in accordance with paragraph (2).".
(2) Section 472(cX2) is amended to read as follows:
"(2) For each month for which an individual receives a National
Research Service Award which is made for a period in excess of
twelve months, such individual shall engage in one month of health
research or teaching or any combination thereof which is in accord-
ance with the usual patterns of academic employment.".
(3) The second sentence of section 472(cX3) is amended to read as
follows: "The Secretary shall by regulation prescribe the type of
research and teaching in which an individual may engage to comply
with such requirement and such other requirements respecting
research and teaching as the Secretary considers appropriate. .
(d) The first sentence of section 472(d) is amended by striking out
"and" after "1980," and by inserting before the period a comma and
"$182,000,000 for the fiscal year ending September 30, 1982, and
$195,000,000 for thefiscalyear ending September 30,1983".
(e) Section 473(c) (42 U.S.C. 2891-2(c)) is amended (1) by striking out
"Interstate and Foreign Commerce" and inserting in lieu thereof
"Energy and Commerce", and (2) by striking out Public Welfare"
and inserting in lieu thereof "Human Resources".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 569
EXTENSION OF ASSISTANCE FOR LIBRARIES; MISCELLANEOUS
SEC. 925. (a) Section 890(c) (42 U.S.C. 280b(c)) is amended by striking
out "and" after "1980," and by inserting before the period a comma
and the following: "and $7,500,000 for the fiscal year ending Septem-
ber 30,1982".
(b) Section 434(d)(1) (42 U.S.C. 289c-l(d)(l)) is amended by inserting 94 Stat. 3184.
"musculoskeletal and skin diseases," after "arthritis,".
Subtitle D—Categorical Programs
PREVENTIVE HEALTH SERVICE PROGRAMS
SEC. 928. (a) Subsection (a) of section 317(a) of the Public Health
Service Act (42 U.S.C. 247b) is amended to read as follows:
"(a) The Secretary may make grants to States, and in consultation
with State health authorities, to political subdivisions of States and to
other public entities to assist them in meeting the costs of establish-
ing and maintaining preventive health service programs.".
(b) Subsection (j) of such section (42 U.S.C. 247b(j)(l)(A)) is amended
to read as follows:
"(j)(l) For grants under subsection (a) for preventive health service
programs to immunize children against immunizable diseases there
are authorized to be appropriated $29,500,000 for the fiscal year
ending September 30, 1982, $32,000,000 for the fiscal year ending
September 30, 1983, and $34,500,000 for the fiscal year ending
September 30,1984.
"(2) For grants under subsection (a) for preventive health service
programs for tuberculosis there are authorized to be appropriated
$9,000,000 for the fiscal year ending September 30,1982, $10,000,000
for the fiscal year ending September 30,1983, and $11,000,000 for the
fiscal year ending September 30,1984.".
PREVENTION AND CONTROL OF VENEREAL DISEASES
SEC. 929. The first sentence of section 318(d)(1) of the Public Health
Service Act (42 U.S.C. 247c(d)(l)) is amended by striking out "and"
after "1980," and by inserting before the period a comma and the
following: "$40,000,000 for the fiscal year ending September 30,1982,
$46,500,000 for the fiscal year ending September 30, 1983, and
$50,000,000 for the fiscal year ending September 30,1984".
EXTENSION OF PROGRAM FOR MIGRANT HEALTH CENTERS
SEC. 930. (a) Section 329(h) of the Public Health Service Act (42
U.S.C. 247d(h)) is amended by striking out paragraphs (1), (2), and (3) 42 use 254b.
and inserting in lieu thereof the following:
"(h)(1) For the purposes of subsections (c), (d), and (e), there are
authorized to be appropriated $43,000,000 for the fiscal year ending
September 30,1982, $47,500,000 for the fiscal year ending September
30, 1983, and $51,000,000 for the fiscal year ending September 30,
1984. The Secretary may not obligate for grants and contracts under
subsection (c)(1) in any fiscal year an amount which exceeds 2 per
centum of the funds appropriated under this paragraph for that fiscal
year, the Secretary may not obligate for grants under subsection
(d)(1)(C) in any fiscal year an amount which exceeds 5 per centum of
such funds, and the Secretary may not obligate for contracts under
95 STAT. 570 PUBLIC LAW 97-35—AUG. 13, 1981
subsection (e) in any fiscal year an amount which exceeds 10 per
centum of such funds.".
42 use 254b. (b) Paragraph (4) of section 329(h) is redesignated as paragraph (2).
FAMILY PLANNING PROGRAMS
SEC. 931. (aXD Section 1001(c) of the Public Health Service Act (42
U.S.C. 300(c)) is amended by striking out "and" after "1980," and by
inserting before the period a comma and the following: "$126,510,000
for the fiscal year ending September 30, 1982; $139,200,000 for the
fiscal year ending September 30,1983; and $150,830,000 for the fiscal
year ending September 30,1984".
(2) Section 1003(b) of such Act (42 U.S.C. 300a-l(b)) is amended by
striking out "and" after "1980," and by inserting before the period a
comma and the following: "$2,920,000 for the fiscal year ending
September 30, 1982; $3,200,000 for the fiscal year ending September
30, 1983; and $3,500,000 for the fiscal year ending September 30,
1984".
(3) Section 1005(b) of Such Act (42 U.S.C. 300a-3(b)) is amended by
striking out "and" £ifter "1980," and by inserting before the period a
comma and the following: "$570,000 for the fiscal year ending
September 30,1982; $600,000 for the fiscal year ending September 30,
1983; and $670,000 for the fiscal year ending September 30, 1984".
(b)(1) Section 1001(a) of such Act is amended by adding at the end
the following: "To the extent practiced, entities which receive grants
or contracts under this subsection shall encourage familiy participa-
tion in projects assisted under this subsection.".
42 use 300a-2. (2) Section 1004 is amended by striking out "(a)" after "SEC. 1004."
and by striking out subsection (b).
^tudy. (c) The Secretary of Health and Human Services shall conduct a
note study of the possible ways of State delivery of the services for which
42 use 300. assistance is authorized by title X of the Public Health Service Act
and the willingness and ability of the States to assume the adminis-
Report to tration of activities assisted under such title X. The Secretary shall
eongress. report to the Congress on the results of such study 18 months after
the date of the enactment of this Act.
Subtitle E—Health Planning
AUTHORIZATIONS
SEC. 933. (a)(1) Section 1516(d)(1) of the Public Health Service Act
(42 U.S.C. 3001-5(d)(l)) is amended bv inserting "and" after "1980,"
and by inserting a period after "1981' and striking out the remainder
of such section.
(2) Section 1525(c) of such Act (42 U.S.C. 300m-4(c)) is amended by
inserting "and" after "1980," and by inserting a period after "1981^'
and striking out the remainder of such section.
(3) Section 1534(d) of such Act (42 U.S.C. 300n-3(d)) is amended by
inserting "and" after "1980," and by inserting a period after "198r'
and striking out the remainder of such section.
(b) Part D of the Public Health Service Act is amended by adding at
the end the following:
"AUTHORIZATIONS FOR FISCAL YEAR 1982
42 use 300n-6 "SEC. 1537. For grants and contracts under sections 1516(a), 1525(a),
and 1534(a) there is authorized to be appropriated $102,000,000 for
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 571
fiscal year 1982. Of the amount appropriated under this section, not
more than $65,000,000 may be used for grants under section 1516(a).".
MINIMUM G R A N T ; WAIVER OF REQUIREMENTS
SEC. 934. (a) Section 1516(cXl)(CXiv) of the Public Health Service
Act is amended by striking out "$260,000" and inserting in lieu 42 use 300/-5.
thereof "$100,000".
(b) The Secretary of Health and Human Services may— 42 use 300Z-2
(1) upon application waive the application of the requirements "°*®
of subsection (e), (g), or (h) of section 1513 of the Public Health
Service Act, or any combination of such subsections, to a health 42 use 300/-2.
systems agency if the Secretary determines that the Federal
funds made available to the agency are not sufficient to enable it
to meet such requirements or
(2) by regulation waive the application of the requirements of
subsection (e), (g), or (h) of section 1513 of the Public Health
Service Act, or any combination of such subsections, to all health
systems agencies if the Secretary determines that the Federal
funds made available to all the agencies are not sufficient to
enable them to meet such requirements.
STATES WITHOUT HEALTH SYSTEMS AGENCIES
SEC. 935. (aXD Section 1536 of the Public Health Service Act (42
U.S.C. 300n-5) is amended—
(1) by striking out subsection (a),
(2) by amending the matter in subsection (b) preceding para-
graph (1) to read as follows: "Upon application of the chief
executive officer of a State or the Commonwealth of Puerto Rico,
the Virgin Islands, Guam, the Trust Territory of the Pacific
Islands, the Northern Mariana Islands, or AmericEm Samoa, it
shall, upon approval of the application, be considered to be a
State for purposes of this title and",
(3) by striking out "sections 1516 and 1640" and inserting in
lieu thereof "section 1640", and
(4) by adding after and below paragraph (4) the following:
"An application made under this section for a fiscal year shall be
made not later than November 1 in that fiscal year and shall contain
the certification of the chief executive officer that the State is willing
and able to meet the purposes of this title in such fiscal year without
any health systems agency in the State.".
(b) A State which— 42 use 300Z-5
(1) because of section 1536(b) of the Public Health Service Act '^"^
(as in effect on September 30, 1981) received a grant under
section 1516 of such Act for fiscal year 1981, and
(2) had an application under section 1536 of such Act (as
amended by subsection (a)) approved,
shall be eligible to receive a grant under section 1516 of such Act for
fiscal year 1982.
(c) If a State which on the date of the enactment of this Act has a 42 use 300/-5
population of less than 600,000 and has only one health service area "°*®
has an application approved under this section, such State shall be
eligible to receive a grant under section 1516 of the Public Health
Service Act for fiscal year 1982.
(d) The last sentence of section 1512(bX5) of the Public Health
Service Act (42 U.S.C. 3001-l(b)(5)) is amended by inserting before the
period the following: "or health insurance".
95 STAT. 572 PUBLIC LAW 97-35—AUG. 13, 1981
CERTIFICATE OF NEED REVIEW
SEC. 936. (a) Section 1531 of the Public Health Service Act (42 U.S.C.
300n) is amended—
(1) by striking out "$75,000" each place it occurs in paragraph
(5) and inserting in lieu thereof "$250,000";
(2) by striking out "$150,000" each place it occurs in paragraph
(6) and inserting in lieu thereof "$600,000"; and
(3) by striking out "$150,000" each place it occurs in paragraph
(7) and inserting in lieu thereof "$400,000".
QoXD Section 1521(d)(1)(B) of the Public Health Service Act (42
U.S.C. 300m(d)(l)(BXii)) is amended—
(A) by strUdng out "twelve months" the second time it appears
in clause (i) and inserting in lieu thereof "twenty-four months",
and
(B) by striking out "twelve months" the second time it appears
in clause (ii) and inserting in lieu thereof "twenty-four months".
(2) The first sentence of section 1521(b)(2)(B) of such Act is amended
to read as follows: "The period of an agreement described in subpara-
graph (A) shall not extend beyond the period set forth in subsection
(d)(1)(B).".
EFFECTIVE DATE
42 u s e 300Z-1 SEC. 937. The amendments made by this subtitle shall take effect
note. October 1,1981.
Health
Maintenance
Subtitle F—Health Maintenance Organizations
Organization
Amendments of CHAPTER 10—HEALTH MAINTENANCE ORGANIZATIONS
1981.
SHORT TITLE; REFERENCE TO ACT
42 u s e 201 note. SEC. 940. (a) This subtitle may be cited as the "Health Maintenance
Organization Amendments of 1981".
(b) Whenever in this subtitle an amendment or repeal is expressed
in terms of an amendment to, or repeal of, a section or other
provision, the reference shall be considered to be made to a section or
42 u s e 201 note. other provision of the Public Health Service Act.
EXTENSIONS
SEC. 941. (a) Subsection (a) of section 1309 (42 U.S.C. 300e-8(a)) is
amended to read as follows:
42 u s e 300e-2, "(a)(1) For grants and contracts under sections 1303 and 1304 there
300e-3.
is authorized to be appropriated $20,000,000 for the fiscal years 1982,
1983, and 1984, No funds appropriated under this paragraph may be
expended or obligated for a grant or contract unless the entity
42 u s e 242a, received a grant or contract under section 303 or 304 during or before
242b. the fiscal year 1981.
42 u s e 300e-16. "(2) For grants under section 1317 there is authorized to be
appropriated $1,000,000 for each of the fiscal years 1982, 1983, and
1984.'^
Ot>) Subsection (b) of section 1309 is amended to read as follows:
42 u s e 300e-7. "(b) To maintain in the loan fund established under section 1308(e)
for the purpose of making new loans a balance of at least $5,000,000 at
the end of each fiscal year and to meet the obligations of the loan fund
resulting from defaults on loans made from the fund and to meet the
other obligations of the fund, there is authorized to be appropriated to
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 573
the loan fund for fiscal years 1982,1983, and 1984, such sums as mav
be necessary to assure such balance and meet such obligations.'.
(c) Section 1304(j) (42 U.S.C. 300e-3(j)) is amended by striking out
"1981" and inserting in lieu thereof "1984".
REVISION OF REQUIREMENTS FOR HEALTH MAINTENANCE
ORGANIZATIONS
SEC. 942. (a)(1) Section 1301(b)(3) is amended (A) by striking out 42 use 300e.
subparagraph (C), and (B) by redesignating subparagraphs (D) and (E)
as subparagraphs (C) and (D), respectively.
(2) Section 1301(b)(3)(A)(iv) is amended by striking out "subject to
subparagraph (C),".
(3)(A) Section 1310(b)(1) (42 U.S.C. 300e-9(b)(l)) is amended by
striking out "provides basic health services" and inserting in lieu
thereof "provides more than one-half of its basic health services
which are provided by physicians".
(B) Section 1310(b)(2) is amended by striking out "basic health
services" and inserting in lieu thereof "its basic health services which
are provided by physicians".
(4) Section 1310(b)(2) (42 U.S.C. 300e-9(b)(2)) is amended by striking
out "or (B)" and inserting in lieu thereof "(B) individual physicians
and other health professionals under contract with the organization,
or(C)".
(5) The amendment made by paragraph (3)(A) shall apply with ^^ use 300e-9
respect to the offering of a health maintenance organization in note.
accordance with section 13100t>Xl) of the Public Health Service Act
after four years after the date the organization becomes a qualified
health maintenance organization for purposes of section 1310 of such
Act if the health maintenance organization provides assurances
satisfactory to the Secretary that upon the expiration of such four
years it will provide more than one half of its basic health services
which are provided by physicians through physicians or other health
professionals who are members of the staff of the organization or a
medical group (or groups).
(b)(1) Section 1301(b)(3XB) is amended by striking out "(i)", by
striking out clause (ii), and by redesignating subclauses (I) and (II) as
clauses (i) and (ii), respectively.
(2) Subparagraph (D) of section 1301(b)(3) is amended to read as
follows:
"(D) Contracts between a health maintenance organization and
health professionals for the provision of basic and supplemental
health services shall include such provisions as the Secretary may
require, but only to the extent that such requirements are designed to
insure the delivery of quality health care services and sound fiscal
management.".
(c)(1) The first sentence of section 1301(bX4) (42 U.S.C. 300e(bX4)) is
amended by inserting before the period a comma and the following:
"except that a health maintenance organization which has a service
area located wholly in a nonmetropolitan area may make a basic
health service avauable outside its service area if that basic health
service is not a primary care or emergency health care service and if
there is an insufficient number of providers of that basic health
service within the service area who will provide such service to
members of the health maintenance organization".
(2) The first sentence of section 1301(b)(4) is amended by striking
out "promptly as appropriate" and inserting in lieu thereof "with
reasonable promptness".
95 STAT. 574 PUBLIC LAW 97-35—AUG. 13, 1981
42 use 300e. (d)(1) Section 1301(c) is amended by striking out paragraphs (4), (9),
and (10), by redesignating paragraphs (5) through (8) as paragraphs
(4) through (7), by redesignating paragraph (11) as paragraph (9), and
by adding after paragraph (7) (as so redesignated) the following new
paragraph:
"(8) adopt at least one of the following arrangements to protect
its members from incurring liability for payment of any fees
which are the legal obligation of such organization—
"(A) a contractual arrangement with any hospital that is
regularly used by the members of such organization prohib-
iting such hospital from holding any such member liable for
pajmient of any fees which are the legal obligation of such
organization;
(B) insolvency insurance, acceptable to the Secretary;
"(C) adequate financial reserve, acceptable to the Secre-
tary; and
. (D) other arrangements, acceptable to the Secretary, to
protect members,
except that the requirements of this paragraph shall not apply to
a health maintenance organization if applicable State law pro-
vides the members of such organization with protection from
liability for payment of any fees which are the legal obligation of
such organization; and".
(2) Subsection (d) of section 1301 is repealed.
(e) Section 1301(c)(2) (42 U.S.C. 300e(c)(2)) is amended—
(1) by striking out "obtain insurance or make other arrange-
ments",
(2) by inserting "obtain insurance or make other arrange-
ments'^^after "(A)^, "(B)", and "(C)",
(3) by striking out "and (C)" and inserting in lieu thereof "(C)",
and
(4) by inserting before the semicolon a comma and the follow-
ing: "and (D) make arrangements with physicians or other
health professionals, health care institutions, or any combina-
tion of such individuals or institutions to assume all or part of the
financial risk on a prospective basis for the provision of basic
health services by the physicians or other health professionals or
through the institutions".
(f) The last sentence of section 1302(1) (42 U.S.C. 300e-l(l)) is
repealed.
(g)(1) The first sentence of section 1302(2) (42 U.S.C. 300e-l(2)) is
amended to read as follows: "The term 'supplemental health services'
means any health service which is not included as a basic health
service under paragraph (1) of this section.".
(2) The second sentence of such section is amended by striking out
"If a service of a physician described in the preceding sentence' and
inserting in lieu thereof "If a health service provided by a physician".
(3) The last sentence of such section is repealed.
(h) Section 1302(4)(C) is amended by inserting before the semicolon
at the end of clause (i) the following: , except that this clause does not
apply before the end of the forty-eight month period beginning after
the month in which the health maintenance oranization becomes a
qualified health maintenance organization as defined in section
42 use 300e-9. 1310(d), or as authorized by the Secretary in accordance with regula-
tions that take into consideration the unusual circumstances of the
group".
(i) Section 1302(5)(B) is amended by striking out "feasible (1)" and
inserting in lieu thereof "feasible," and by striking out "administra-
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 575
tive staff and all that follows in such section and inserting in lieu
thereof "administrative staff.".
0) Section 1302(8) (42 U.S.C. 300e-l(8)) is amended to read as
follows:
"(8)(A) The term 'community rating system' means the systems,
described in subparagraphs (B) and (C), of fixing rates of payments for
health services. A health maintenance organization may fix its rates
of payments under the system described in subparagraph (B) or (C) or
under both such systems, but a health maintenance organization may
use only one such system for fixing its rates of payments for any one
group.
"(B) A system of fixing rates of payment for health services may
provide that the rates shall be fixed on a per-person or per-family
basis and may authorize the rates to vary with the number of persons
in a family, but, except as authorized in subparagraph (D), such rates
must be equivalent for all individuals and for all families of similar
composition.
"(C) A system of fixing rates of pa5mient for health services may
provide that the rates shall be fixed for individuals and families by
groups. Except as authorized in subparagraph (D), such rates must be
equivalent for all individuals in the same group and for all families of
similar composition in the same group. If a health maintenance
organization is to fix rates of payment for individuals and families by
groups, it shall—
"(i) classify all of the members of the organization into classes
based on factors which the health maintenance organization
determines predict the differences in the use of health services by
the individuals or families in each class and which have not been
disapproved by the Secretary,
"(ii) determine its revenue requirements for providing services
to the members of each class established under clause (i), and
"(iii) fix the rates of payment for the individuals and families of
a group on the basis of a composite of the organization's revenue
requirements determined under clause (ii) for providing services
to them as members of the classes established under clause (i).
The Secretary shall review the factors used by each health mainte-
nance organization to establish classes under clause (i). If the Secre-
tary determines that any such factor may not reasonably be used to
predict the use of the health services by individuals and families, the
Secretary shall disapprove such factor for such purpose.
"(D) The following differentials in rates of payments may be
established under the systems described in subparagraphs (B) and (C):
"(i) Nominal differentials in such rates may be established to
reflect differences in marketing costs and the different adminis-
trative costs of collecting payments from the following categories
of members:
"(I) Individual members (including their families).
"(II) Small groups of members (as determined under regu-
lations of the Secretary).
"(Ill) Large groups of members (as determined under
regulations of the Secretary).
"(ii) Nominal differentials in such rates may be established to
reflect the compositing of the rates of payment in a systematic
manner to accommodate group purchasing practices of the
various employers.
"(iii) Differentials in such rates may be established for mem-
bers enrolled in a health maintenance organization pursuant to a
contract with a governmental authority under section 1079 or
95 STAT. 576 PUBLIC LAW 97-35—AUG. 13, 1981
1086 of title 10, United States Code, or under any other govern-
mental program (other than the health benefits program author-
5 use 8901 et ized by chapter 89 of title 5, United States Code) or any health
*^^" benefits program for employees of States, political subdivision of
States, and other public entities.".
INITIAL OPERATION COSTS
SEC. 943. (a) Section 1805(a) (42 U.S.C. 300e-4) is amended—
(1) by striking out "nonprofit" in paragraphs (1) and (2), and
(2) by amending paragraph (3) to read as follows:
"(3) guarantee to non-Federsd lenders payment of the principal
of and the interest on loans made to private health maintenance
organizations for the amounts referred to in paragraphs (1) and
(2).".
(b) Section 1305(bXl) is amended to read as follows:
"(bXD Except as provided in paragraph (2), the aggregate amount of
principal of loans made or guaranteed, or both, under subsection (a)
for a health maintenance organization may not exceed $7,000,000. In
any twelve-month period the amount disbursed to a health mainte-
nance organization under this section (either directly by the Secre-
tary, by an escrow agent under the terms of an escrow agreement, or
by a lender under a guaranteed loan) may not exceed $3,000,000.".
(c) Section 1305(d) is amended by striking out "1981" and inserting
in lieu thereof "1986".
(d) Subsection (e) of section 1307 (42 U.S.C. 300e-6) is repealed.
AMBULATORY FACIUTIES
SEC. 944. (a) Section 1305A(a) (42 U.S.C. 300e-4a(a)) is amended—
(1) by striking out "nonprofit" in paragraph (1), and
(2) by amending paragraph (2) to read as follows:
"(2) guarantee to non-Federal lenders for their loans to private
health maintenance organizations for projects described in para-
graph (1) the payment of principal and interest on such loans.",
(b) Subsections (b) and (c) of section 1305A are redesignated as
subsections (c) and (d), respectively, and the following is inserted after
subsection (a):
"(b) No loan may be made to a health maintenance organization
and no loan to a health maintenance organization may be guaranteed
under subsection (a) unless the application of the health maintenance
organization for such loan or loan guarantee contains assurances
satisfactory to the Secretary that—
"(1) at the time the application is made the health mainte-
nance organization isfiscallysound;
"(2) if the application is for a loan, the health maintenance
organization is unable to secure a loan, at the rate of interest
prevailing in the area in which the organization is located, from
non-Federal lenders for the project with respect to which the
application is submitted, or, if the application is for a loan
guarantee, the health maintenance organization would be
unable to secure a loan from such lenders for such project
without the loan guarantee; and
"(3) during the period of the loan or loan guarantee, the health
maintenance organization will remain fiscally sound.".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 577
LOANS
SEC. 945. Section 1308(bX2) (42 U.S.C. 300e-7(b)(2)) is amended—
(1) by amending clause (D) to read as follows: "(D) on the date
the loan is made, bear interest at a rate comparable to the rate of
interest prevailing on such date with respect to marketable
obligations of the United States of comparable maturities, ad-
justed to provide for appropriate administrative charges, and";
and
(2) by adding at the end the following: "On the date disburse-
ments are made under a loan after the initial disbursement
under the loan, the Secretary may change the rate of interest on
the amount of the loan disbursed on that date to a rate which is
comparable to the rate of interest prevailing on the date the
subsequent disbursement is made with respect to marketable
obligations of the United States of comparable maturities, ad-
justed to provide for appropriate administrative charges.".
DUAL CHOICE
SEC. 946. (a) Section 1310(d) (42 U.S.C. 300e-9(d)) is amended by
adding at the end the following: "Every two years (or such longer
period as the Secretary may by regulation prescribe) after the date a
health maintenance organization becomes a qualified health mainte-
nance organization under this subsection, the health maintenance
organization must demonstrate to the Secretary that it is qualified
within the meaning of this subsection.".
(b) Section 1310(f)(1) is amended by inserting before the semicolon a
comma and the following: "except that such term includes nonappro-
priated fund instrumentalities of the Government of the United
States".
REPEAL OF SPECIAL CONSIDERATIONS
SEC. 947. (a) Section 1303 (42 U.S.C. 300e-2) is amended by striking
out subsection (i).
(b) Section 1304 (42 U.S.C. 300e-3) is amended by striking out
subsection (k).
(c) Section 1305 (42 U.S.C. 300e-4) is amended by striking out
subsection (e).
FINANCIAL DISCLOSURE
SEC. 948. (a) Subsection (a)(2) of section 1318 (42 U.S.C. 300e-17) is
amended to read as follows:
"(2) A copy of the report, if any, filed with the Health Care
Financing Administration containing the information required
to be reported under section 1124 of the Social Security Act by 42 use i320a-3.
disclosing entities and the information required to be supplied
under section 1902(aX38) of such Act.". 42 use I396a.
(b) Subsection (aX3XB) of such section is amended to read as follows:
"(B) any furnishing for consideration of goods, services
(including management services), or facilities between the
health maintenance organization and a party in interest, but
not including salaries paid to employees for services pro-
vided in the normal course of their employment and health
services provided to members by hospitals and other provid-
ers and by staff, medical group (or groups), individual prac-
tice association (or associations), or any combination thereof:
and".
95 STAT. 578 PUBLIC LAW 97-35—AUG. 13, 1981
42 use 300e-i7. (Q) Subsection (b)(1) of such section is amended by striking out
"employee" and inserting in lieu thereof "employee responsible for
management or administration".
(d) Subsection (b)(4) of such section is amended to read as follows:
"(4) any spouse, child, or parent of an individual described in
paragraph (1).".
MISCELLANEOUS
SEC. 949. (a) The third sentence of section 1312(b)(1) (42 U.S.C.
300e-l 1(b)(1)) is amended by inserting after "Secretary prescribes"
the following: ", then after the Secretary provides the entity a
reasonable opportunitv for reconsideration of his determination,
including, at the entity s election, a fair hearing".
Repeals. (b) Sections 1314 and 1316 (42 U.S.C. 300e-13,300e-15) are repealed,
(c) Section 1527(bXl) (42 U.S.C. 300m-6(bXl)) is amended—
(1) by striking out clause (i) in subparagraph (A) and
by redesignating clauses (ii) and (iii) as clauses (i) and (ii),
respectively,
(2) by striking out "such enrolled individuals" in subparagraph
(A) and inserting in lieu thereof "individuals enrolled in such
organization or organizations",
(3) by striking out "which has, in the service area of the
organization or service areas of the organizations in the combina-
tion, an enrollment of at least 50,000 individuals" in subpara-
graph (BXii),
(4) by striking out "such enrolled individuals" in subparagraph
(BXiii) and inserting in lieu thereof "individuals enrolled in such
organization or organizations",
(5) by striking out "which has, in the service area or the
organization or service areas of the organizations in the combina-
tion, an enrollment of at least 50,000 individuals" in subpara-
graph (CXi), and
(6) by striking out "such enrolled individuals" in subparagraph
(CXii) and inserting in lieu thereof "individuals enrolled in such
organization or organizations".
Effective date. (d) The amendments made by subsection (c) shall take effect
42USC300m-6 October 1,1982.
note.
Subtitle G—Adolescent Family Life
SEC. 955. (a) The Public Health Service Act is amended by adding at
the end thereof the following new title:
"TITLE XX—ADOLESCENT FAMILY LIFE DEMONSTRATION
PROJECTS
"FINDINGS AND PURPOSES
42 use 300z. "SEC. 2001. (a) The Congress finds that—
"(1) in 1978, an estimated one million one hundred thousand
teenagers became pregnant, more than five hundred thousand
teenagers carried their babies to term, and over one-half of the
babies born to such teenagers were born out of wedlock;
"(2) adolescents aged seventeen and younger accounted for
more than one-half of the out of wedlock births to teenagers;
"(3) in a high proportion of cases, the pregnant adolescent is
herself the product of an unmarried parenthood during adoles-
cence and is continuing the pattern in her own lifestyle;
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 579
"(4) it is estimated that approximately 80 per centum of
unmarried teenagers who carry their pregnancies to term live
with their families before and during their pregnancy and
remain with their families after the birth of the child;
"(5) pregnancy and childbirth among unmarried adolescents,
particularly young adolescents, often results in severe adverse
health, social, and economic consequences, including: a higher
percentage of pregnancy and childbirth complications; a higher
incidence of low birth weight babies; a higher frequency of
developmental disabilities; higher infant mortality and morbid-
ity; a decreased likelihood of completing schooling; a greater
likelihood that an adolescent marriage will end in divorce; and
higher risks of unemployment and welfare dependency;
(6)(A) adoption is a positive option for unmarried pregnant
adolescents who are unwilling or unable to care for their chil-
dren since adoption is a means of providing permanent families
for such children from available approved couples who are
unable or have difficulty in conceiving or carrying children of
their own to term; and
"(B) at present, only 4 per centum of unmarried pregnant
adolescents who carry their babies to term enter into an adoption
plan or arrange for their babies to be cared for by relatives or
friends;
"(7) an unmarried adolescent who becomes pregnant once is
likely to experience recurrent pregnancies and childbearing,
with increased risks;
"(8XA) the problems of adolescent premarital sexual relations,
pregnancy, and parenthood are multiple and complex and are
frequently associated with or are a cause of other troublesome
situations in the family; and
"(B) such problems are best approached through a variety of
integrated and essential services provided to adolescents and
their families by other family members, religious and charitable
organizations, voluntary associations, and other groups in the
private sector as well as services provided by publicly sponsored
initiatives;
"(9) a wide array of educational, health, and supportive serv-
ices are not available to adolescents with such problems or to
their families, or when available frequently are fragmented and
thus are of limited effectiveness in discouraging adolescent
premarital sexual relations and the consequences of such rela-
tions;
"(10)(A) prevention of adolescent sexual activity and adoles-
cent pregnancy depends primarily upon developing strong family
values and close family ties, and since the family is the basic
social unit in which the values and attitudes of adolescents
concerning sexuality and pregnancy are formed, programs de-
signed to deal with issues of sexuality and pregnancy will be
successful to the extent that such programs encourage and
sustain the role of the family in dealing with adolescent sexual
activity and adolescent pregnancy;
"(B) Federal policy therefore should encourage the develop-
ment of appropriate health, educational, and social services
where such services are now lacking or inadequate, and the
better coordination of existing services where they are available;
and
"(C) services encouraged by the Federal Government should
promote the involvement of parents with their adolescent chil-
95 STAT. 580 PUBLIC LAW 97-35—AUG. 13, 1981
dren, and should emphasize the provision of support by other
family members, religious and charitable organizations, volun-
tary associations, and other groups in the private sector in order
to help adolescents and their families deal with complex issues of
adolescent premarital sexual relations and the consequences of
such relations; and
"(11)(A) there has been limited research concerning the soci-
etal causes and consequences of adolescent pregnancy;
"(B) there is limited knowledge concerning which means of
intervention are effective in mediating or eliminating adolescent
premarital sexual relations and adolescent pregnancy; and
"(C) it is necessary to expand and strengthen such knowledge
in order to develop an array of approaches to solving the
problems of adolescent premarital sexual relations and adoles-
cent pregnancy in both urban and rural settings.
"(b) Therefore, the purposes of this title are—
"(1) to find effective means, within the context of the family, of
reaching adolescents before they become sexually active in order
to maximize the guidance and support available to adolescents
from parents and other family members, and to promote self
discipline and other prudent approaches to the problem of
adolescent premarital sexual relations, including adolescent
pregnancy;
"(2) to promote adoption as an alternative for adolescent
parents;
"(3) to establish innovative, comprehensive, and integrated
approaches to the delivery of care services for pregnant adoles-
cents, with primary emphasis on unmarried adolescents who are
seventeen years of age or under, and for adolescent parents,
which shall be based upon an assessment of existing programs
and, where appropriate, upon efforts to establish better coordina-
tion, integration, and linkages among such existing programs in
order to—
"(A) enable pregnant adolescents to obtain proper care
and assist pregnant adolescents and adolescent parents to
become productive independent contributors to family and
community life; and
"(B) assist families of adolescents to understand and re-
solve the societal causes which are associated with adoles-
cent pregnancy;
"(4) to encourage and support research projects and demon-
stration projects concerning the societal causes and conse-
quences of adolescent premarital sexual relations, contraceptive
use, pregnancy, and child rearing;
"(5) to support evaluative research to identify effective services
which alleviate, eliminate, or resolve any negative consequences
of adolescent premarital sexual relations and adolescent child-
bearing for the parents, the child, and their families; and
"(6) to encourage and provide for the dissemination of results,
findings, and information from programs and research projects
relating to adolescent premarital sexual relations, pregnancy,
and parenthood.
"DEFINITIONS
42 use 300Z-1. "SEC. 2002. (a) For the purposes of this title, the term—
"(1) 'Secretary' means the Secretary of Health and Human
Services;
"(2) 'eligible person' means—
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 581
"(A) with regard to the provision of care services, a
pregnant adolescent, an adolescent parent, or the family of a
pregnant adolescent or an adolescent parent; or
"(B) with regard to the provision of prevention services
and referral to such other services which may be appropri-
ate, a nonpregnant adolescent;
"(3) 'eligible grant recipient' means a public or nonprofit
private organization or agency which demonstrates, to the satis-
faction of the Secretary—
"(A) in the case of an organization which will provide care
services, the capability of providing all core services in a
single setting or the capability of creating a network through
which all core services would be provided; or
"(B) in the case of an organization which will provide
prevention services, the capability of providing such serv-
ices;
"(4) 'necessary services' means services which may be provided
by grantees which are—
"(A) pregnancy testing and maternity counseling;
"(B) adoption counseling and referral services which pres-
ent adoption as an option for pregnant adolescents, includ-
ing referral to licensed adoption agencies in the community
if the eligible grant recipient is not a licensed adoption
agency;
"(C) primary and preventive health services including
prenatal and postnatal care;
"(D) nutrition information and counseling;
"(E) referral for screening and treatment of venereal
disease;
"(F) referral to appropriate pediatric care;
"(G) educational services relating to family life and prob-
lems associated with adolescent premarital sexual relations,
including—
"(i) information about adoption;
"(ii) education on the responsibilities of sexuality and
parenting;
"(iii) the development of material to support the role
of parents as the provider of sex education; and
"(iv) assistance to parents, schools, youth agencies,
and health providers to educate adolescents and prea-
dolescents concerning self-discipline and responsibility
in human sexuality;
"(H) appropriate educational and vocational services and
referral to such services;
"(I) referral to licensed residential care or maternity home
services; and
"(J) mental health services and referral to mental health
services and to other appropriate physical health services;
"(K) child care sufficient to enable the adolescent parent
to continue education or to enter into employment;
"(L) consumer education and homemaking;
"(M) counseling for the immediate and extended family
members of the eligible person;
"(N) transportation;
"(O) outreach services to families of adolescents to discour-
age sexual relations among unemancipated minors;
"(P) family planning services; and
95 STAT. 582 PUBLIC LAW 97-35—AUG. 13, 1981
"(Q) such other services consistent with the purposes of
this title as the Secretary may approve in accordance with
regulations promulgated by the Secretary;
"(5) 'core services' means those services which shall be pro-
vided by a grantee, as determined by the Secretary by regulation;
"(6) 'supplemental services' means those services which may
be provided by a grantee, as determined by the Secretary by
regulation;
"(7) 'care services' means necessary services for the provision
of care to pregnant adolescents and adolescent parents and
includes all core services with respect to the provision of such
care prescribed by the Secretary by regulation;
"(8) 'prevention services' means necessary services to prevent
adolescent sexual relations, including the services described in
subparagraphs (A), (D), (E), (G), (H), (M), (N), (O), and (Q) of
paragraph (4);
"(9) 'adolescent' means an individual under the age of nine-
teen; and
"(10) 'unemancipated minor' means a minor who is subject to
the control, authority, and supervision of his or her parents or
guardians, as determined under State law.
"(b) Until such time as the Secretary promulgates regulations
pursuant to the second sentence of this subsection, the Secretary
shall use the regulations promulgated under title VI of the Health
42 use 300a-2i. Services and Centers Amendments of 1978 which were in effect on
the date of enactment of this title, to determine which necessary
services are core services for purposes of this title. The Secretary may
promulgate regulations to determine which necessary services are
core services for purposes of this title based upon an evaluation of and
information concerning which necessary services are essential to
carry out the purposes of this title and taking into account (1) factors
such as whether services are to be provided in urban or rural areas,
the ethnic groups to be served, and the nature of the populations to be
served, and (2) the results of the evaluations required under section
2006(b). The Secretary may from time to time revise such regulations.
"AUTHORITY TO MAKE GRANTS FOR DEMONSTRATION PROJECTS
42 use 300Z-2. "SEC. 2008. (a) The Secretary may make grants to further the
purposes of this title to eligible grant recipients which have submit-
ted an application which the Secretary finds meets the requirements
of section 2006 for demonstration projects which the Secretary
determines will help communities provide appropriate care and
prevention services in easily accessible locations. Demonstration
projects shall, as appropriate, provide, supplement, or improve the
quality of such services. Demonstration projects shall use such
methods as will strengthen the capacity of families to deal with the
sexual behavior, pregnancy, or parenthood of adolescents and to
make use of support systems such as other family members, friends,
religious and charitable organizations, and voluntary associations.
"(b) Grants under this title for demonstration projects may be for
the provision of—
"(1) care services;
"(2) prevention services; or
"(3) a combination of care services and prevention services.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 583
"USES OF GRANTS FOR DEMONSTRATION PROJECTS FOR SERVICES
"SEC. 2004. (a) Except as provided in subsection (h), funds provided 42 use 300z-3.
for demonstration projects for services under this title may be used by
grantees only to—
"(1) provide to eligible persons—
"(A) care services;
"(B) prevention services; or
"(C) care and prevention services (in the case of a grantee
who is providing a combination of care and prevention
services);
"(2) coordinate, integrate, and provide linkages among provid-
ers of care, prevention, and other services for eligible persons in
furtherance of the purposes of this title;
"(3) provide supplemental services where such services are not
adequate or not available to eligible persons in the community
and which are essential to the care of pregnant adolescents and
to the prevention of adolescent premaritsd sexual relations and
adolescent pregnancy;
"(4) plan for the administration and coordination of pregnancy
prevention services and programs of care for pregnant adoles-
cents and adolescent parents which will further the objectives of
this title; and
"(5) fulfill assurances required for grant approval by section
2006.
"(bXD No funds provided for a demonstration project for services
under this title may be used for the provision of fgimily planning
services (other than counseling and referral services) to adolescents
unless appropriate family planning services are not otherwise availa-
ble in the community.
"(2) Any grantee who receives funds for a demonstration project for
services under this title and who, after determining under paragraph
(1) that appropriate family planning services are not otherwise
available in the community, provides family planning services (other
than counseling and referral services) to adolescents may only use
funds provided under this title for such family planning services if all
funds received by such grantee from all other sources to support such
family planning services are insufficient to support such family
planning services.
"(c) Grantees who receive funds for a demonstration project for
services under this title shall charge fees for services pursuant to a
fee schedule approved by the Secretary as a part of the application
described in section 2006 which bases fees charged by the grantee on
the income of the eligible person or the parents or legal guardians of
the eligible person and takes into account the difficulty adolescents
face in obtaining resources to pay for services. A grantee who receives
funds for a demonstration project for services under this title may
not, in any case, discriminate with regard to the provision of services
to any individual because of that individual's inability to provide
pa3mient for such services, except that in determining the ability of
an unemancipated minor to provide payment for services, the income
of the family of an unemancipated minor shall be considered in
determining the ability of such minor to make such payments unless
the parents or guardians of the unemancipated minor refuse to make
such payments.
-194 0—82 39 : QL3
95 STAT. 584 PUBLIC LAW 97-35—AUG. 13, 1981
"PRIORITIES, AMOUNTS, AND DURATION OF GRANTS FOR DEMONSTRATION
PROJECTS FOR SERVICES
42 use 300Z-4. "SEC. 2005. (a) In approving applications for grants for demonstra-
tion projects for services under this title, the Secretary shall give
priority to applicants who—
(1) serve an area where there is a high incidence of adolescent
pregnancy;
"(2) serve an area with a high proportion of low-income
families and where the availability of programs of care for
pregnant adolescents and adolescent parents is low;
"(3) show evidence—
"(A) in the case of an applicant who will provide care
services, of having the ability to bring together a wide range
of needed core services and, as appropriate, supplemental
services in comprehensive single-site projects, or to establish
a well-integrated network of such services (appropriate for
the target population and geographic area to be served
including the special needs of rural areas) for pregnant
adolescents or adolescent parents; or
"(B) in the case of an applicant who will provide preven-
tion services, of having the ability to provide prevention
services for adolescents and their families which are appro-
priate for the target population and the geographic area to
be served, including the special needs of rural areas;
"(4) will utilize to the maximum extent feasible existing
available programs and facilities such as neighborhood and
primary health care centers, maternity homes which provide or
can be equipped to provide services to pregnant adolescents,
agencies serving families, youth, and children with established
programs of service to pregnant adolescents and vulnerable
families, licensed adoption agencies, children and youth centers,
maternal and infant health centers, regional rural health facili-
ties, school and other educational programs, mental health
programs, nutrition programs, recreation programs, and other
ongoing pregnancy prevention services and programs of care for
pregnant adolescents and adolescent parents;
"(5) make use, to the maximum extent feasible, of other
Federal, State, and local funds, programs, contributions, and
other third-party reimbursements;
"(6) can demonstrate a community commitment to the pro-
gram by making available to the demonstration project non-
Federal funds, personnel, and facilities;
"(7) have involved the community to be served, including
public and private agencies, adolescents, and families, in the
planning and implementation of the demonstration project; and
"(8) will demonstrate innovative and effective approaches in
addressing the problems of adolescent premarital sexual rela-
tions, pregnancy, or parenthood, including approaches to provide
pregnant adolescents with adequate information about adoption.
"(b)(1) The amount of a grant for a demonstration project for
services under this title shall be determined by the Secretary, based
on factors such as the incidence of adolescent pregnancy in the
geographic area to be served, and the adequacy of pregnancy preven-
tion services and programs of care for pregnant adolescents and
adolescent parents in such area.
"(2) In making grants for demonstration projects for services under
this title, the Secretary shall consider the special needs of rural areas
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 585
and, to the maximum extent practicable, shall distribute funds
taking into consideration the relative number of adolescents in such
areas in need of such services.
"(c)(1) A grantee may not receive funds for a demonstration project
for services under this title for a period in excess of 5 years.
"(2)(A) Subject to paragraph (3), a grant for a demonstration project
for services under this title may not exceed—
"(i) 70 per centum of the costs of the project for the first and
second years of the project;
"(ii) 60 per centum of such costs for the third year of the
project;
"(iii) 50 per centum of such costs for the fourth year of the
project; and
"(iv) 40 per centum of such costs for the fifth year of the
project.
"(B) Non-Federal contributions required by subparagraph (A) may
be in cash or in kind, fairly evaluated, including plant, equipment, or
services.
"(3) The Secretary may waive the limitation specified in paragraph
(2)(A) for any year in accordance with criteria established by regula-
tion.
"REQUIREMENTS FOR APPLICATIONS
"SEC. 2006. (a) An application for a grant for a demonstration 42 use 300z-5.
project for services under this title shall be in such form and contain
such information as the Secretary may require, and shall include—
"(1) an identification of the incidence of adolescent pregnancy
and related problems;
"(2) a description of the economic conditions and income levels
in the geographic area to be served;
"(3) a description of existing pregnancy prevention services
and programs of care for pregnant adolescents and adolescent
parents (including adoption services), and including where, how,
by whom, and to which population groups such services are
provided, and the extent to which they are coordinated in the
geographic area to be served;
"(4) a description of the major unmet needs for services for
adolescents at risk of initial or recurrent pregnancies and an
estimate of the number of adolescents not being served in the
area;
"(5)(A) in the case of an applicant who will provide care
services, a description of how all core services will be provided in
the demonstration project using funds under this title or will
otherwise be provided by the grantee in the area to be served, the
population to which such services will be provided, how such
services will be coordinated, integrated, and linked with other
related programs and services and the source or sources of
funding of such core services in the public and private sectors; or
"(B) in the case of an applicant who will provide prevention
services, a description of the necessary services to be provided
and how the applicant will provide such services;
"(6) a description of the manner in which adolescents needing
services other than the services provided directly by the appli-
cant will be identified and how access and appropriate referral to
such other services (such as medicaid; licensed adoption agencies;
maternity home services; public assistance; employment serv-
ices; child care services for adolescent parents; and other city,
county, and State programs related to adolescent pregnancy) will
95 STAT. 586 PUBLIC LAW 97-35-AUG. 13, 1981
be provided, including a description of a plan to coordinate such
other services with the services supported under this title;
"(7) a description of the applicants capacity to continue
services as Federal funds decrease and in the absence of Federal
assistance;
"(8) a description of the results expected from the provision of
services, and the procedures to be used for evaluating those
results;
"(9) a summary of the views of public agencies, providers of
services, and the general public in the geographic area to be
served, concerning the proposed use of funds provided for a
demonstration project for services under this title and a descrip-
tion of procedures used to obtain those views, and, in the case of
applicants who propose to coordinate services administered by a
State, the written comments of the appropriate State officials
responsible for such services;
(10) assurances that the applicant will have an ongoing
quality assurance program;
"(11) assurances that, where appropriate, the applicant shall
have a system for maintaining the confidentiality of patient
records in accordance with regulations promulgated by the
Secretary;
"(12) assurances that the applicant will demonstrate its finan-
cial responsibility by the use of such accounting procedures and
other requirements as may be prescribed by the Secretary;
"(13) assurances that the applicant (A) has or will have a
contractual or other arrangement with the agency of the State
(in which the applicant provides services) that administers or
supervises the administration of a State plan approved under
42 use 1396. title XIX of the Social Security Act for the payment of all or a
part of the applicant's costs in providing health services to
persons who are eligible for medical assistance under such a
State plan, or (B) has made or will make every reasonable effort
to enter into such an arrangement;
"(14) assurances that the applicant has made or will make and
will continue to make every reasonable effort to collect appropri-
ate reimbursement for its costs in providing health services to
persons who are entitled to benefits under title V of the Social
42 use 701. Security Act, to medical assistance under a State plan approved
under title XIX of such Act, or to £issistance for medical expenses
under any other public assistance program or private health
insurance program;
"(15) assurances that the applicant has or will make and will
continue to make every reasonable effort to collect appropriate
reimbursement for its costs in providing services to persons
entitled to services under parts B and E of title IV and title XX of
94 Stat. 516 the Social Security Act;
94 st^? 50i" "(16)(A) a description of—
42 use 670. "^^^ *^® schedule of fees to be used in the provision of
42 use 1397. services, which shall comply with section 2004(c) and which
shall be designed to cover all reasonable direct and indirect
costs incurred by the applicant in providing services; and
"(ii) a corresponding schedule of discounts to be applied to
the payment of such fees, which shall comply with section
2004(c) and which shall be adjusted on the basis of the ability
of the eligible person to pay;
"(B) assurances that the applicant has made and will continue
to make every reasonable effort—
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 587
"(i) to secure from eligible persons payment for services in
accordance with such schedules;
"(ii) to collect reimbursement for health or other services
provided to persons who are entitled to have payment made
on their behalf for such services under any Federal or other
government program or private insurance program; and
"(iii) to seek such reimbursement on the basis of the full
amount of fees for services without application of any
discount; and
**(C) assurances that the applicant has submitted or will submit
to the Secretary such reports as the Secretary may require to
determine compliance with this paragraph;
"(17) assurances that the applicant will make maximum use of
funds available under title X of this Act; 42 use 300.
"(18) assurances that the acceptance by any individual of
family planning services or family planning information (includ-
ing educational materials) provided through financial assistance
under this title shall be voluntary and shall not be a prerequisite
to eligibility for or receipt of any other service furnished by the
applicant;
"(19) assurances that fees collected by the applicant for serv-
ices rendered in accordance with this title shall be used by the
applicant to further the purposes of this title;
"(20) assurances that the applicant, if providing both preven-
tion and care services will not exclude or discriminate against
any adolescent who receives prevention services and sub-
sequently requires care services as a pregnant adolescent;
"(21) a description of how the applicant will, as appropriate in
the provision of services—
"(A) involve families of adolescents in a manner which will
maximize the role of the family in the solution of problems
relating to the parenthood or pregnancy of the adolescent;
"(B) involve religious and charitable organizations, volun-
tary associations, and other groups in the private sector as
well as services provided by publicly sponsored initiatives;
"(22)(A) assurances that—
"(i) except as provided in subparagraph (B) and subject to
clause (ii), the applicant will notify the parents or guardians
of any unemancipated minor requesting services from the
applicant and, except as provided in subparagraph (C), will
obtain the permission of such parents or guardians with
respect to the provision of such services; and
"(ii) in the case of a pregnant unemancipated minor
requesting services from the applicant, the applicant will
notify the parents or guardians of such minor under clause
(i) within a reasonable period of time;
"(B) assurances that the applicant will not notify or request the
permission of the parents or guardian of any unemancipated
minor without the consent of the minor—
"(i) who solely is requesting from the applicant pregnancy
testing or testing or treatment for venereal disease;
"(ii) who is the victim of incest involving a parent; or
"(iii) if an adult sibling of the minor or an adult aunt,
uncle, or grandparent who is related to the minor by blood
certifies to the grantee that notification of the parents or
guardians of such minor would result in physical injury to
such minor; and
95 STAT. 588 PUBLIC LAW 97-35-AUG. 13, 1981
"(C) assurances that the applicant will not require, with
respect to the provision of services, the permission of the parents
or guardians of any pregnant unemancipated minor if such
parents or guardians are attempting to compel such minor to
have an abortion;
"(23) assurances that primary emphasis for services supported
under this title shall be given to adolescents seventeen and under
who are not able to obtain needed assistance through other
means;
"(24) assurances that funds received under this title shall
supplement and not supplant funds received from any other
Federal, State, or local program or any private sources of funds;
and
"(25) a plan for the conduct of, and assurances that the
applicant will conduct, evaluations of the effectiveness of the
services supported under this title in accordance with subsection
(b).
"(b)(1) Each grantee which receives funds for a demonstration
project for services under this title shall expend at least 1 per centum
but not in excess of 5 per centum of the amounts received under this
title for the conduct of evaluations of the services supported under
this title. The Secretary may, for a particular grantee upon good
cause shown, waive the provisions of the preceding sentence with
respect to the amounts to be expended on evaluations, but may not
waive the requirement that such evaluations be conducted.
"(2) Evaluations required by paragraph (1) shall be conducted by an
organization or entity which is independent of the grantee providing
services supported under this title. To assist in conducting the
evaluations required by paragraph (1), each grsmtee shall develop a
working relationship with a college or university located in the
grantee's State which will provide or assist in providing monitoring
and evaluation of services supported under this title unless no college
or university in the grantee s State is willing or has the capacity to
provide or assist in providing such monitoring and assistance.
"(3) The Secretary may provide technical assistance with respect to
the conduct of evaluations required under this subsection to any
grantee which is unable to develop a working relationship with a
college or university in the applicant's State for the reasons described
in paragraph (2).
"(c) Each grantee which receives funds for a demonstration project
for services under this title shall make such reports concerning its
use of Federal funds as the Secretary may require. Reports shall
include, at such times as are considered appropriate by the Secretary,
the results of the evaluations of the services supported under this
title.
"(d)(1) A grantee shall periodically notify the Secretary of the exact
number of instances in which a grantee does not notify the parents or
guardians of a pregnant unemancipated minor under subsection
(a)(22)(B)(iii).
"(2) For purposes of subsection (a)(22)(B)(iii), the term "adult"
means an adult as defined by State law.
"(e) Each applicant shall provide the Governor of the State in
which the applicant is located a copy of each application submitted to
the Secretary for a grant for a demonstration project for services
under this title. The Governor shall submit to the applicant com-
ments on any such application within the period of sixty days
beginning on the day when the Governor receives such copy. The
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 589
applicant shall include the comments of the Governor with such
application.
"(f) No application submitted for a grant for a demonstration
project for care services under this title may be approved unless the
Secretary is satisfied that core services shall be available through the
applicant within a reasonable time after such grant is received.
"COORDINATION OF FEDERAL AND STATE PROGRAMS
"SEC. 2007. (a) The Secretary shall coordinate Federal policies and 42 use 300z-6.
programs providing services relating to the prevention of adolescent
sexual relations and initial and recurrent adolescent pregnancies and
providing care services for pregnant adolescents. In achieving such
coordination, the Secretary shall—
"(1) require grantees who receive funds for demonstration
projects for services under this title to report periodically to the
Secretary concerning Federal, State, and local policies and pro-
grams that interfere with the delivery of and coordination of
pregnancy prevention services and other programs of care for
pregnant adolescents and adolescent parente;
"(2) provide technical assistance to facilitate coordination by
State and local recipients of Federal assistance;
"(3) review all programs administered by the Department of
Health and Human Services which provide prevention services
or care services to determine if the policies of such programs are
consistent with the policies of this title, consult with other
departments and agencies of the Federal Government who ad-
minister programs that provide such services, and encourage
such other departments and agencies to make recommendations,
as appropriate, for legislation to modify such programs in order
to facilitate the use of all Government programs which provide
such services as a basis for delivery of more comprehensive
prevention services and more comprehensive programs of care
for pregnant adolescents and adolescent parents;
"(4) gpLve priority in the provision of funds, where appropriate,
to applicants using single or coordinated grant applications for
multiple programs; and
"(5) give priority, where appropriate, to the provision of funds
under Federal programs administered by the Secretary (other
than the program established by this title) to projects providing
comprehensive prevention services and comprehensive programs
of care for pregnant adolescents and adolescent parents.
"(b) Any recipient of a grant for a demonstration project for
services under this title shall coordinate its activities with any other
recipient of such a grant which is located in the same locality.
"RESEARCH
"SEC. 2008. (a)(1) The Secretary may make grants and enter into 42 use 300z-7.
contracts with public agencies or private organizations or institutions
of higher education to support the research and dissemination
activities described in paragraphs (4), (5), and (6) of section 2001(b).
"(2) The Secretary may make grants or enter into contracts under
this section for a period of one year. A grant or contract under this
section for a project may be renewed for four additional one-year
periods, which need not be consecutive.
"(3) A grant or contract for any one-year period under this section
may not exceed $100,000 for the direct costs of conducting research or
95 STAT. 590 PUBLIC LAW 97-35—AUG. 13, 1981
disemination activities under this section and may include such
additional amounts for the indirect costs of conducting such activities
as the Secretary determines appropriate. The Secretary may waive
the preceding sentence with respect to a specific project if he
determines that—
"(A) exceptional circumstances warrant such waiver and that
the project will have national impact; or
"(B) additional amounts are necessary for the direct costs of
conducting limited demonstration projects for the provision of
necessary services in order to provide data for research carried
out under this title.
"(4) The amount of any grant or contract made under this section
may remain available for obligation or expenditure after the close of
the one-year period for which such grant or contract is made in order
to assist the recipient in preparing the report required by subsection
(f)(1).
"(b)(1) Funds provided for research under this section may be used
for descriptive or explanatory surveys, longitudinal studies, or limit-
ed demonstration projects for services that are for the purpose of
increasing knowledge and understanding of the matters described in
paragraphs (4) and (5) of section 2001(b).
"(2) Funds provided under this section may not be used for the
purchase or improvement of land, or the purchase, construction, or
permanent improvement (other than minor remodeling) of any build-
ing or facility.
(c) The Secretary may not make any grant or enter into any
contract to support research or dissemination activities under this
section unless—
"(1) the Secretary has received an application for such grant or
contract which is in such form and which contains such informa-
tion as the Secretary may by regulation require;
"(2) the applicant has demonstrated that the applicant is
capable of conducting one or more of the types of research or
dissemination activities described in paragraph (4), (5), or (6) of
section 2001(b); and
"(3) in the case of an application for a research project, the
panel established by subsection (e)(2) has determined that the
project is of scientific merit.
"(d) The Secretary shall, where appropriate, coordinate research
and dissemination activities carried out under this section with
research and dissemination activities carried out by the National
Institutes of Health.
"(e)(1) The Secretary shall establish a system for the review of
applications for grants and contracts under this section. Such system
shall be substantially similar to the system for scientific peer review
of the National Institutes of Health and shall meet the requirements
of paragraphs (2) and (3).
(2) In establishing the system required by paragraph (1), the
Secretary shall establish a panel to review applications under this
section. Not more than 25 per centum of the members of the panel
shall be physicians. The panel shall meet £is often as may be
necessary to facilitate the expeditious review of applications under
this section, but not less than once each year. The panel shall review
each project for which an application is made under this section,
evaluate the scientific merit of the project, determine whether the
g roject is of scientific merit, and make recommendations to the
ecretary concerning whether the application for the project should
be approved.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 591
"(3) The Secretary shall make grants under this section from
among the projects which the panel established by paragraph (2) h£is
determined to be of scientific merit and may only approve an
application for a project if the panel has made such determination
with respect to such a project. The Secretary shall make a determina-
tion with respect to an application within one month after receiving
the determinations and recommendations of such panel with respect
to the application.
"(fKlXA) The recipient of a grant or contract for a research project
under this section shall prepare and transmit to the Secretary a
report describing the results and conclusions of such research. Except
as provided in subparsigraph (B), such report shall be transmitted to
the Secretary not later than eighteen months after the end of the
year for which funds are provided under this section. The recipient
may utilize reprints of articles published or accepted for publication
in professional journals to supplement or replace such report if the
research contained in such articles was supported under this section
during the year for which the report is required.
"(B) In the case of any research project for which assistance is
provided under this section for two or more consecutive one-year
periods, the recipient of such assistance shall prepare and transmit
the report required by subparagraph (A) to the Secretary not later
than twelve months atfter the end of each one-year period for which
such funding is provided.
"(2) Recipiente of grsints and contracts for dissemination under this
section shall submit to the Secretary such reports as the Secretary
determines appropriate.
"(g) In carr3ring out functions relating to the conduct and support of
research under this section, the Secretary shall not be subject to the
provisions of chapter 35 of title 44, United States Code, except with 94 Stat 2812.
respect to the collection of survey data which primarily will be used seq.44 u s e 3501 et
for the generation of national population estimates.
EVALUATION AND ADMINISTRATION
"SEC. 2009. (a) Of the funds appropriated under this title, the 42 use 300z-8.
Secretary shall reserve not less than 1 per centum and not more than
3 per centum for the evaluation of activities carried out under this
title. The Secretary shall submit to the appropriate committees of the Submittal to
Congress a summary of each evaluation conducted under this section, congressional
"(b) The officer or emplovee of the Department of Health and committees.
Human Services designated by the Secretary to carry out the provi-
sions of this title shall report directly to the Assistant Secretary for
Health with respect to the activities of such officer or employee in
canying out such provisions.
"AUTHORIZATION OF APPROPRIATIONS
"SEC. 2010. (a) For the purpose of carrying out this title, there are 42 use 300z-9.
authorized to be appropriated $30,000,000 for the fiscal year ending
September 30,1982, $30,000,000 for the fiscal year ending September
30, 1983, and $30,000,000 for the fiscal year ending September 30,
1984.
"(b) At least two-thirds of the amounts appropriated to carry out
this title shall be used to make grants for demonstration projects for
services.
"(c) Not more than one-third of the amounts specified under
subsection (b) for use for grants for demonstration projects for
95 STAT. 592 PUBLIC LAW 97-35—AUG. 13, 1981
services shall be used for grants for demonstration projects for
prevention services.
"RESTRICTIONS
42 use 300Z-10. "SEC. 2011. (a) Grants or p a r e n t s may be made only to programs
or projects which do not provide abortions or abortion counseling or
referral, or which do not subcontract with or make any payment to
any person who provides abortions or abortion counseling or referral,
except that any such program or project may provide referral for
abortion counseling to a pregnant adolescent if such adolescent and
the parents or guardians of such adolescent request such referral;
and grants may be made only to projects or programs which do not
advocate, promote, or encourage abortion.
"(b) The Secretary shall ascertain whether programs or projects
comply with subsection (a) and take appropriate action if programs or
projects do not comply with such subsection, including withholding of
funds.".
Repeals (b) Effective October 1,1981, titles VI, VII, and VIII of the Health
42 use 300a-4i Services and Centers Amendments of 1978 are repealed.
42 u s e 300a-2l'
i^ote. Subtitle H—Alcohol and Drug Programs
CHAPTER 1—ALCOHOL ABUSE AND ALCOHOLISM PREVEN-
TION, TREATMENT, AND REHABILITATION
REFERENCE
SEC. 960. Except as otherwise specifically provided, whenever in
this subtitle an amendment or repeal is expressed in terms of an
amendment to, or a repeal of, a section or other provision, the
reference shall be considered to be made to a section or other
provision of the Comprehensive Alcohol Abuse and Alcoholism Pre-
42 use 4541 vention. Treatment, and Rehabilitation Act of 1970.
note.
ALCOHOL ABUSE AND ALCOHOLISM AMONG GOVERNMENT AND OTHER
EMPLOYEES
42 use 4561. SEC. 961. Section 201(bX2XB) is amended by striking out "single
State agencies designated pursuant to section 303 of this Act" and
inserting in Ueu thereof the State agencies responsible for the
administration of alcohol abuse prevention, treatment, and rehabili-
tation activities".
TECHNICAL ASSISTANCE
42 use 4571. SEC. 962. (a) Section 301 is amended to read as follows:
"TECHNICAL ASSISTANCE
"SEC. 301. (a) On the request of any State, the Secretary, acting
through the Institute, shaU, to the extent feasible, make available
technical assistance for—
"(1) developing and improving systems for data collection;
"(2) program management, accountability, and evaluation;
"(3) cert^cation, accreditation, or licensure of treatment facil-
ities and personnel;
"(4) monitoring compliance by hospitals and other facilities
42 use 4581. with the requirements of section 321; and
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 593
"(5) eliminating exclusions in health insurance coverage of-
fered in the State which are based on alcoholism or alcohol
abuse.
"(b) Insofar as practicable, technical assistance provided under this
section shall be provided in a manner which will improve coordina-
tion between activities supported under this Act and under the Drug
Abuse Prevention, Treatment, and Rehabilitation Act.". 21 use iioi
(b) Sections 302,303, and 310 are repealed. Sep^eais.
42 u s e 4572,
GRANTS AND CONTRACTS 4573, 4576.
SEC. 963. (a) The section heading for section 311 is amended to read 42 use 4577.
as follows:
"GRANTS AND CONTRACTS FOR THE DEMONSTRATION OF NEW AND
MORE EFFECTIVE ALCOHOL ABUSE AND ALCOHOLISM PREVENTION,
TREATMENT, AND REHABIUTATION PROGRAMS".
(b) Section 311(a) is amended—
(1) by adding at the end of clause (1) "and with particular
emphasis on developing new and more effective alcohol abuse
and alcoholism prevention, treatment, and rehabilitation pro-
grams,";
(2) by inserting "and" after the comma the last place it appears
in clause (2);
(3) by striking out clauses (3) and (5) and by redesignating
clause (4) as clause (3); and
(4) by striking out the comma and "and" at the end of clause (3)
(as redesignated by clause (2) of this subsection) and inserting in
lieu thereof a period.
(c)(1) Section 311(cX2XA) is amended—
(A) by striking out "designated under section 303 of this Act, if
such designation has been made" in the first sentence and
inserting in lieu thereof "responsible for the administration of
alcohol abuse and alcoholism prevention, treatment, and reha-
bilitation activities";
(B) by striking out "the" before "State comprehensive plan" in
the third sentence and inserting in lieu thereof "any"; and
(C) by striking out "under section 303" in the third sentence.
(2) Section 311(cX3) is amended—
(A) by inserting "and" after the semicolon in clause (B);
(B) by striking out the semicolon and "and" at the end of clause
(C) and inserting in lieu thereof a period; and
(C) by striking out clause (D).
(3) Section 311(cX4) is amended to read as follows:
"(4) The Secretary shall encourage the submission of and give
special consideration to applications under this section for programs
and projects aimed at underserved populations such as racial and
ethnic minorities. Native Americans, youth, the elderly, women,
handicapped individuals, public inebriates, and families of alcohol-
ics.".
(4) Section 311(c) is further amended—
(A) by redesignating paragraph (5) as paragraph (6);
(B) by inserting after paragraph (4) the following new para-
graph:
"(5)(A) No grant may be made under this section to a State or to any
entity within the government of a State unless the grant application
has been duly authorized by the chief executive officer of such State.
95 STAT. 594 PUBLIC LAW 97-35—AUG. 13, 1981
"(B) No grant or contract may be made under this section for a
period in excess of five years.
"(C)(i) The amount of any grant or contract under this section may
not exceed 100 per centum of the cost of carrying out the grant or
contract in the first fiscal year for which the grant or contract is
made under this section, 80 per centum of such cost in the second
fiscal year for which the grsuit or contract is made under this section,
70 per centum of such cost in the third fiscal year for which the grant
or contract is made under this section, and 60 per centum of such cost
in each of the fourth and fifth fiscal years for which the grant or
contract is made under this section.
"(ii) For purposes of this subparagraph, no grant or contract shall
be considered to have been made under this section for a fiscal year
ending before September 30,1981."; and
(C) by adding at the end thereof the following new paragraph:
"(7) Nothing shall prevent the use of funds provided under this
section for programs and projects aimed at the prevention, treat-
ment, or rehabilitation of drug abuse as well as alcohol abuse and
alcoholism.".
AUTHORIZATION OF APPROPRIATIONS; PROJECT GRANTS AND CONTRACTS
42 use 4578. SEC. 964. (a) The first sentence of section 312 is amended—
(A) by striking out "sections 310 and 311" and inserting in lieu
thereof "section 311"; and
(B) by striking out "and" after "1980," and by inserting before
the period a comma and "and $15,000,000 for the fiscal year
ending September 30,1982".
Ob) The second sentence of such section is amended by striking out
"and" after the semicolon the first place it appears and by inserting
before the period a semicolon and "and of the funds appropriated
under this section for the fiscal year ending September 30, 1982, at
least 25 per centum of the funds shall be obligated for such grants".
ALCOHOL ABUSE RESEARCH AND RESEARCH CENTERS
42 use 4588. SEC. 965. (a) Section 503 (42 U.S.C. 4587) is amended—
(A) by inserting "(a)" after "503.",
(B) by striking out "the purposes of sections 501 and 502" and
inserting in lieu thereof "this title",
(C) by striking out "and" after "1980,", and
(D) by striking out the period and inserting in lieu thereof a
comma and the following: "$25,000,000 for the fiscal year ending
September 30,1982. Of the funds appropriated under this section
for any fiscal year beginning after September 30,1981, not more
than 35 per centum may be obligated for grants under section
503.".
42 use 4587. (b) Section 504(b) (42 U.S.C. 4588(b)) is amended by adding at the
end the following: "The Secretary shall include in the grants made
under this section for fiscal years beginning after September 30,1981,
a grant to a designated Center for research on the effects of alcohol on
the elderly.".
42 use 4587, (c) Section 503 is inserted after section 504 of such Act and is
redesignated as section 504 and the section 504 of such Act relating to
National Alcohol Research Centers is redesignated as section 503.
sy
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 595
TECHNICAL AMENDMENTS
SEC. 966. (a) The first sentence of section 101(a) is amended (1) by 42 use 4551.
striking out "Health, Education, and Welfare" and inserting in lieu
thereof "Health and Human Services", and (2) by striking out "and
part C of the Community Mental Health Centers Act".
(b) Section 102(1) is amended by striking out "and part C of the 42 use 4552.
Community Mental Health Centers Act".
(c) Section 103(b) is amended by striking out "Health, Education, 42 use 4553.
and Welfare" and inserting in lieu thereof "Health and Human
Services".
(d) Section 201(bX4) is amended by striking out "Office and Treat- 42 use 4561.
ment Act of 1972" and inserting in lieu thereof "Prevention, Treat-
ment, and Rehabilitation Act".
(e) Section 201(e) is amended by striking out "Health, Education,
and Welfare" and inserting in lieu thereof "Health and Human
Services".
(f)(1) The heading for title HI is amended to read as follows:
"TITLE III—TECHNICAL ASSISTANCE AND FEDERAL
GRANTS AND CONTRACTS"
(2) The heading for part A of title III is amended to read as follows:
"PART A—TECHNICAL ASSISTANCE".
CHAPTER 2—DRUG ABUSE PREVENTION, TREATMENT, AND
REHABILITATION
REFERENCE
SEC. 967. Except as otherwise specifically provided, whenever in
this chapter an amendment or repeal is expressed in terms of an
amendment to, or a repeal of, a section or other provision, the
reference shall be considered to be made to a section or other
provision of the Drug Abuse Prevention, Treatment, and Rehabilita-
tion Act. 21 use 1101
ADDITIONAL DRUG ABUSE PREVENTION FUNCTIONS "°**
SEC. 968. (a) Section 406(a) is amended— 2i use 1173.
(1) by inserting "and" after the semicolon in clause (2);
(2) by striking out the semicolon and "and" at the end of clause
(3) and inserting in lieu thereof a period; and
(3) by striking out clause (4).
(b) The section heading for section 406 is amended by striking out
"Health, Education, and Welfare" and inserting in lieu thereof
"Health and Human Services".
(c) The item relating to section 406 in the table of sections for title
IV is amended by striking out "Health, Education, and Welfare" and
inserting in lieu thereof 'liealth and Human Services".
FORMULA GRANTS
SEC. 969. (a) Section 409 is repealed. Repeal.
Ob) The table of sections for title IV is amended by striking out the ^^ ^ ^ ^^'^^
item relating to section 409.
95 STAT. 596 PUBLIC LAW 97-35—AUG. 13, 1981
GRANTS AND CONTRACTS
21 use 1177. SEC. 970. (aXD The section heading for section 410 is amended to
read as follows:
''§410. Grants and contracts for the demonstration of new and
more effective prevention, treatment, and rehabilitation
programs.".
(2) The item relating to section 410 in the table of sections for title
IV is amended to read as follows:
"410. Grants and contracts for the demonstration of new and more effective preven-
tion, treatment, and rehabilitation programs.".
(bXD The first sentence of section 410(a) is amended to read as
follows: "The Secretary acting through the National Institute on
Drug Abuse, may make grants to and enter into contracts with
individuals and public and private nonprofit entities—
"(1) to provide training seminars, educational programs, and
technical assistance for the development, demonstration, and
evaluation of drug abuse prevention, treatment, and rehabilita-
tion programs; and
"(2) to conduct demonstration and evaluation projects, with a
high priority on prevention and early intervention projects and
on identifying new and more effective drug abuse prevention,
treatment, and rehabilitation programs.".
(2) Section 410(a) is further amended by adding at the end thereof
the following new sentence: "Furthermore, nothing shall prevent the
use of funds provided under this section for programs and projects
aimed at the prevention, treatment, and rehabilitation of alcohol
abuse and alcoholism as well as drug abuse.".
Appropriation (c) Section 410(b) is amended by adding at the end thereof the
authorization. following new Sentences: "For carrying out the purposes of this
section, there are authorized to be appropriated $15,000,000 for the
fiscal year ending September 30, 1982. Of the funds appropriated
under the preceding sentence, at least 25 per centum of the funds
shall be obligated for grants and contracts for primary prevention
and intervention programs designed to discourage individuals, par-
ticularly individuals in high risk populations, from abusing drugs.".
(d)(1)(A) The first sentence of section 410(cX2) is amended by
striking out "designated or established under section 409" and
inserting in lieu thereof "responsible for the administration of drug
abuse prevention activities".
(B) The third sentence of such section is amended—
(i) by striking out "the" before "State comprehensive plan"
and inserting in lieu thereof "any"; and
(ii) by striking out "under section 409".
(2) Section 410(cX3) is amended—
(A) by inserting "and" after the semicolon in clause (B);
(B) by striking out the semicolon and "and" at the end of clause
(C) and inserting in lieu thereof a period; and
(C) by striking out clause (D).
(e) Section 410(d) is amended to read as follows:
"(d) The Secretary shall encourage the submission of and give
special consideration to applications under this section to programs
and projects aimed at underserved populations such as racial and
ethnic minorities, native Americans, youth, the elderly, women,
handicapped individuals, and families of drug abusers.".
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 597
(f) Section 410 is further amended by adding at the end thereof the 2i use 1177.
following new subsection:
"(g)(1) No grant may be made under this section to a State or to any
entity within the government of a State unless the grant application
has been duly authorized by the chief executive officer of such State.
"(2) No grant or contract may be made under this section for a
period in excess of five years,
"(3)(A) The amount of any grant or contract under this section may
not exceed 100 per centum of the cost of carrying out the grant or
contract in the first fiscal year for which the grant or contract is
made under this section, 80 per centum of such cost in the second
fiscal year for which the grant or contract is made under this section,
70 per centum of such cost in the third fiscal year for which the grant
or contract is made under this section, and 60 per centum of such cost
in each of the fourth and fifth fiscal years for which the grant or
contract is made under this section.
"(B) For purposes of this paragraph, no grant or contract shall be
considered to have been made under this section for a fiscal year
ending before September 30,1981.".
RECORDS AND AUDIT
SEC. 971. Section 411(a) is amended by striking out "409 or". 21 USC 1178.
DRUG ABUSE RESEARCH
SEC. 972. (a) Section 503 is amended— 21 USC 1193.
(1) by inserting "(a)" before "The Director shall";
(2) by striking out "and" after the semicolon in clause (3);
(3) by striking out the period at the end of clause (4) and
inserting in lieu thereof a semicolon and "and"; and
(4) by inserting after clause (4) the following new clause:
"(5) drug abuse prevention, treatment, and rehabilitation.";
(5) by striking out "this section" in the last sentence and
inserting in lieu thereof "this subsection"; and
(6) by adding at the end the following:
"(b) The Director may—
"(1) make grants or enter into contracts with individuals and
public and nonprofit entities for the purpose of determining the
causes of drug abuse in a particular area, and
"(2) make grants to and enter into contracts with individuals
and public and private nonprofit entities for research respecting
improved drug maintenance and detoxification techniques and
programs.
"(c) For the purposes of subsections (a) and (b), there are authorized Appropriation
to be appropriated $45,000,000 for the fiscal year ending September authorization.
30,1982.".
(b) The heading for section 503 of such Act is amended by striking
out "certain research and development" and inserting in lieu thereof
"research".
(c) The item relating to section 503 in the table of sections for title V
of such Act is amended by striking out "certain research and
development" and inserting in lieu thereof "research".
95 STAT. 598 PUBLIC LAW 97-35—AUG. 13, 1981
TECHNICAL AMENDMENTS
21 u s e 1115. SEC. 973. (a) Section 205 is amended by striking out "Health,
Education, and Welfare" and inserting in lieu thereof "Health and
Human Services".
21 u s e 1162. (b) Section 302 is amended by striking out "Health, Education, and
Welfare" and inserting in lieu thereof "Health and Human Serv-
ices".
21 u s e 1172. (cXl) Section 405 is amended by striking out "Health, Education,
and Welfare" each place it appears and inserting in lieu thereof
"Health and Human Services".
(2) The section heading for section 405 is amended by striking out
"Health, Education, and Welfare" and inserting in lieu thereof
"Health and Human Services".
(3) The item relating to section 405 in the table of sections for title
IV is amended by striBng out "Health, Education, and Welfare" and
inserting in lieu thereof 'llealth and Human Services".
21 u s e 1175. (d) Section 408(g) is amended by striking out "Health, Education,
and Welfare" and inserting in lieu thereof "Health and Human
Services".
21 u s e 1180. (e) Section 4130b)(2XB) is amended by striking out "single State
agencies designated pursuant to section 409(e)(1) of this Act" and
inserting in lieu thereof "the State agencies responsible for the
administration of drug abuse prevention activities".
21 u s e 1191. (f) Section 501 is amended by striking out "Health, Education, and
Welfare" and inserting in lieu thereof "Health and Human Serv-
ices".
eonsumer- Subtitle I—Consumer-Patient Radiation Health and
Patient
Radiation
Health and
Safety Act of 1981
Safety Act of
1981. SHORT TITLE
42 u s e 10001 SEC. 975. This subtitle may be cited as the "Consumer-Patient
note. Radiation Health and Safety Act of 1981".
STATEMENT OF FINDINGS
42 use 10001. SEC. 976. The Congress finds that—
(1) it is in the interest of public health and safety to minimize
unnecessary exposure to potentially hazardous radiation due to
medical and dental radiologic procedures;
(2) it is in the interest of public health and safety to have a
continuing supply of adequately educated persons and appropri-
ate accreditation and certification programs administered by
State governments;
(3) the protection of the public health and safety from unneces-
sary exposure to potentially hazardous radiation due to medical
and dental radiologic procedures and the assurance of efficacious
procedures are the responsibility of State and Federal govern-
ments;
(4) persons who administer radiologic procedures, including
procedures at Federal facilities, should be required to demon-
strate competence by reason of education, training, and experi-
ence; and
(5) the administration of radiologic procedures and the effect
on individuals of such procedures have a substantial and direct
effect upon United States interstate commerce.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 599
STATEMENT OP PURPOSE
SEC. 977. It is the purpose of this subtitle to— 42 use 10002.
(1) provide for the establishment of minimum standards by the
Federal Government for the accreditation of education programs
for persons who administer radiologic procedures and for the
certification of such persons; and
(2) insure that medical and dental radiologic procedures are
consistent with rigorous safety precautions and standards.
DEFINITIONS
SEC. 978. Unless otherwise expressly provided, for purposes of this '^2 use 10003.
subtitle, the term—
(1) "radiation" means ionizing and nonionizing radiation in
amounts beyond normed background levels from sources such as
medical and dental radiologic procedures;
(2) "radiologic procedure" means any procedure or article
intended for use in—
(A) the diagnosis of disease or other medical or dental
conditions in humans (including diagnostic X-rays or nucle-
ar medicine procedures); or
(B) the cure, mitigation, treatment, or prevention of dis-
ease in humans;
that achieves its intended purpose through the emission of
radiation;
(3) "radiologic equipment" means any radiation electronic
product which emits or detects radiation and which is used or
intended for use to—
(A) diagnose disease or other medical or dental conditions
(including diagnostic X-ray equipment); or
(B) cure, mitigate, treat, or prevent disease in humans;
that achieves its intended purpose through the emission or
detection of radiation;
(4) "practitioner" means any licensed doctor of medicine,
osteopathy, dentistry, podiatry, or chiropractic, who prescribes
radiologic procedures for other persons;
(5) "persons who administer radiologic procedures" means any
person, other than a practitioner, who intentionally administers
radiation to other persons for medical purposes, and includes
medic£j radiologic technologists (including dental hygienists and
assistants), radiation therapy technologists, and nuclear medi-
cine technologists;
(6) "Secretary" means the Secretary of Health and Human
Services; and
(7) "State" means the several States, the District of Columbia,
the Commonwealth of Puerto Rico, the Commonwealth of the
Northern Mariana Islands, the Virgin Islands, Guam, American
Samoa, and the Trust Territory of the Pacific Islands.
PROMULGATION OF STANDARDS
SEC. 979. (a) Within twelve months after the date of enactment of Regulation.
this Act, the Secretary, in consultation with the Radiation Policy 42 u s e 10004.
Council, the Administrator of Veterans' Affairs, the Administrator of
the Environmental Protection Agency, appropriate agencies of the
States, and appropriate professional organizations, shall by regula-
tion promulgate minimum standards for the accreditation of educa-
89-194 O—82 40:QL3
95 STAT. 600 PUBLIC LAW 97-35—AUG. 13, 1981
tional programs to train individuals to perform radiologic proce-
dures. Such standards shall distinguish between programs for the
education of (1) medical radiologic technologists (including radio-
graphers), (2) dental auxiliaries (including dental hygienists and
assistants), (3) radiation therapy technologists, (4) nuclear medicine
technologists, and (5) such dther kinds of health auxiliaries who
administer radiologic procedures as the Secretary determines appro-
priate. Such standards shall not be applicable to educational pro-
grams for practitioners.
Regulation. (b) Within twelve months after the date of enactment of this Act,
the Secretary, in consultation with the Radiation Policy Council, the
Administrator of Veterans' Affairs, the Administrator of the Envi-
ronmental Protection Agency, interested agencies of the States, and
appropriate professional organizations, shall by regulation promul-
gate minimum standards for the certification of persons who admin-
ister radiologic procedures. Such standards shall distinguish between
certification of (1) medical radiologic technologists (including radio-
graphers), (2) dental auxiliaries (including dental hygienists and
assistants), (3) radiation therapy technologists, (4) nuclear medicine
technologists, and (5) such other kinds of health auxiliaries who
administer radiologic procedures as the Secretary determines appro-
priate. Such standards shall include minimum certification criteria
for individuals with regard to accredited education, practical experi-
ence, successful passage of required examinations, and such other
criteria as the Secretary shall deem necessary for the adequate
qualification of individuals to administer radiologic procedures. Such
standards shall not apply to practitioners.
MODEL STATUTE
42 use 10005. SEC. 980. In order to encourage the administration of accreditation
and certification programs by the States, the Secretary shall prepare
and transmit to the States a model statute for radiologic procedure
safety. Such model statute shall provide that—
(1) it shall be unlawful in a State for individuals to perform
radiologic procedures unless such individuals are certified by the
State to perform such procedures; and
(2) any educational requirements for certification of individ-
uals to perform radiologic procedures shall be limited to educa-
tional programs accredited by the State.
COMPUANCE
42 use 10006. SEC. 981. (a) The Secretary shall take all actions consistent with law
to effectuate the purposes of this subtitle.
(b) A State may utilize an accreditation or certification program
administered by a private entity if^
(1) such State delegates the administration of the State accredi-
tation or certification program to such private entity;
(2) such program is approved by the State; and
(3) such program is consistent with the minimum Federal
standards promulgated under this subtitle for such program.
(c) Absent compliance by the States with the provisions of this
subtitle within three years after the date of enactment of this Act, the
Secretary shall report to the Congress recommendations for legisla-
tive changes considered necessary to assure the States' compliance
with this subtitle.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 601
(d) The Secretary shall be responsible for continued monitoring of Report to
compliance by the States with the applicable provisions of this Congress.
subtitle and shall report to the Senate and the House of Representa-
tives by January 1, 1982, and January 1 of each succeeding year the
status of the States' compliance with the purposes of this subtitle.
(e) Notwithstanding any other provision of this section, in the case
of a State which has, prior to the effective date of standards and
guidelines promulgated pursuant to this subtitle, established stand-
ards for the accreditation of educational programs and certification
of radiologic technologists, such State shall be deemed to be in
compliance with the conditions of this section unless the Secretary
determines, after notice and hearing, that such State standards do
not meet the minimum standards prescribed by the Secretary or are
inconsistent with the purposes of this subtitle.
FEDERAL RADIATION GUIDELINES
SEC. 982. The Secretary shall, in conjunction with the Radiation 42 u s e 10007.
Policy Council, the Administrator of Veterans' Affairs, the Adminis-
trator of the Environmental Protection Agency, appropriate agencies
of the States, and appropriate professional organizations, promulgate
Federal radiation guidelines with respect to radiologic procedures.
Such guidelines shall—
(1) determine the level of radiation exposure due to radiologic
procedures which is unnecessary and specify the techniques,
procedures, and methods to minimize such unnecessary expo-
sure;
(2) provide for the elimination of the need for retakes of
diagnostic radiologic procedures;
(3) provide for the elimination of unproductive screening
programs;
(4) provide for the optimum diagnostic information with mini-
mum radiologic exposure; and
(5) include the therapeutic application of radiation to individ-
uals in the treatment of disease, including nuclear medicine
applications.
APPUCABILITY TO FEDERAL AGENCIES
SEC. 983. (a) Except as provided in subsection (b), each department, 42 use 10008.
agency, and instrumentality of the executive branch of the Federal
Government shall comply with standards promulgated pursuant to
this subtitle.
(b)(1) The Administrator of Veterans' Affairs, through the Chief Regulations.
Medical Director of the Veterans' Administration, shall, to the
maximum extent feasible consistent with the responsibilities of such
Administrator and Chief Medical Director under subtitle 38, United
States Code, prescribe regulations making the standards promulgat- 38 use loi et
ed pursuant to this subtitle applicable to the provision of radiologic ^^9
procedures in facilities over which the Administrator has jurisdic-
tion. In prescribing and implementing regulations pursuant to this
subsection, the Administrator shall consult with the Secretary in
order to achieve the maximum possible coordination of the regula-
tions, standards, and guidelines, and the implementation thereof,
which the Secretary and the Administrator prescribe under this
subtitle.
(2) Not later than 180 days after standards are promulgated by the Report to
Secretary pursuant to this subtitle, the Administrator of Veterans' congressional
committees.
95 STAT. 602 PUBLIC LAW 97-35—AUG. 13, 1981
Affairs shall submit to the appropriate committees of Congress a full
report with respect to the regulations (including guidelines, policies,
and procedures thereunder) prescribed pursuant to paragraph (1) of
this subsection. Such report shall include—
(A) an explanation of any inconsistency between standards
made applicable by such regulations and the standards promul-
gated by the Secretary pursuant to this subtitle;
(B) an account of the extent, substance, and results of consulta-
tions with the Secretary respecting the prescription and imple-
mentation of regulations by the Administrator; and
(C) such recommendations for legislation and administrative
action as the Administrator determines are necessary and desir-
able.
Publication in (3) The Administrator of Veterans' Affairs shall publish the report
Register required by paragraph (2) in the Federal Register.
Subtitle J—Orderly Closure, Transfer, and Financial
Self-Sufficiency of Public Health Service Hospitals
and Clinics
FINDINGS AND PURPOSES
42 use 248b SEC. 985. (a) Congress finds that—
^°^^- (1) because of national budgetary considerations, it has become
necessary to terminate Federal appropriations for Public Health
Service hospitals and clinics,
(2) with proper planning and coordination, some of these
hospitals and clinics could be transferred to State, local, or
private control or become financially self-sufficient and continue
to provide effective and efficient health care to individuals in the
areas in which they are located,
(3) a precipitous closure of these hospitals and clinics will
preclude the possibility of such orderly transfer to entities which
are willing and able to take over operations at such facilities and
will cause unnecessary and costly hardships on the patients and
staffs at such facilities and on the communities in which the
facilities are located, and
(4) it is in the national interest, consistent with sound budg-
etary considerations, to assist in the orderly and prompt transfer
of such operations to State, local, or private operation or in the
achievement of financial self-sufficiency where feasible.
(b) The purposes of this subtitle are—
(1) to provide for the prompt and orderly closure by October 31,
1981, of Public Health Service hospitals and clinics which cannot
reasonably be transferred to State, local, or private operation or
become financially self-sufficient and for the transfer or achieve-
ment of financial self-sufficiency by September 30,1982, of those
hospitals and clinics which can be so transferred or which can
achieve such financial self-sufficiency, and
(2) to provide for transitional assistance for merchant seamen
whose entitlement to receive free care through Public Health
Service hospitals and clinics is repealed and who are hospitalized
at the end of fiscal year 1981 and require continuing hospitaliza-
tion.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 603
ELIMINATION OP MERCHANT MARINE ENTITLEMENT TO HEALTH
SERVICES
SEC. 986. (a) Subsection (h) of section 2 and subsections (a) and (b) of
section 322 of the Public Health Service Act are repealed. 42 use 201, 249.
(b)(1) Section 322(e) of such Act is amended—
(A) by striking out "entitled to care and treatment under
subsection (a) of this section and persons"; and
(B) by striking out "subsection (c)" and inserting in lieu thereof
"subsection (a) .
(2) Subsections (c), (d), and (e) of section 322 of such Act are
redesiffliated as subsections (a), (b), and (c), respectively.
(3) llie section heading for section 322 of such Act is amended by
striking out "SEAMEN" and inserting in lieu thereof "PERSONS UNDER
QUARANTINE".
(4) Section 332(aX2XC) of such Act is amended by striking out 42 use 254e.
"seamen" and inserting in lieu thereof "persons under quarantine".
(c) The amendments and repeals made by this section shall take Effective date.
effect on October 1,1981. ^^ use 249 note.
PROPOSALS FOR TRANSFER OR FINANCIAL SELF-SUFFICIENCY OF PUBLIC
HEALTH SERVICE HOSPITALS AND CLINICS
SEC. 987. (a) The Secretary of Health and Human Services (herein- 42 use 248b.
after in this subtitle referred to as the "Secretary") shall, in accord-
ance with this section and notwithstanding section 818 of Public Law
93-155, provide for the closure, transfer, or financial self-sufficiency 42 use 248a.
of all hospitals and other stations of the Public Health Service
(hereinafter in this subtitle referred to as the "Service") not later
than September 30,1982.
(b) Not later than July 1, 1981, the Secretary shall notify each
Service hospital and other station, and the chief executive officer of
each State and of each locality in which such a hospital or other
station is located, that the Secretary will accept proposals for the
transfer of each such hospital and station from the Service to a public
(including Federal) or nonprofit private entity or for the achievement
of financial self-sufficiency of each such hospital and station not later
than September 30,1982. No such proposal shall be considered by the
Secretary if it is submitted later than September 1,1981.
(c) The Secretary shall evaluate promptly each proposal submitted
under subsection (b) with respect to a hospital or other station and
determine, not later than September 30,1981, whether or not under
such proposal the hospital or station—
(1) will be maintained as a general health care facility provid-
ing a range of services to the population within its service area,
(2) will continue to make services available to existing patient
populations, and
(3) has a reasonable expectation of financial viability and, in
the case of a hospital or station that is not proposed to be
transferred, of financial self-sufficiency.
Paragraph (1) shall not apply in the case of a proposal for the
transfer of a discrete, minor, freestanding part of a hospital or station
to a local public entity for the purpose of continuing the provision of
services to refugees.
(d)(1) If the Secretary determines that a proposal for a hospital or
other station does not meet the standards of subsection (c) or if there
is no proposal submitted under subsection (b) with respect to a
hospital or other station, the Secretary shall provide for the closure of
the hospital or station by not later than October 31,1981.
95 STAT. 604 PUBLIC LAW 97-35—AUG. 13, 1981
(2) If the Secretary determines that a proposal for a hospital or
other station meets the standards of subsection (c), the Secretary
shall take such steps, within the amounts available through appropri-
ations, as may be necessary and proper—
(A) to operate (or participate or assist in the operation of) the
hospital or station by the Service until the transfer is accom-
plished or financial self-sufficiency is achieved,
(B) to bring the hospital or station into compliance with
applicable licensure, accreditation, and local medical practice
standards, and
(C) to provide for such other legal, administrative, personnel,
and financial arrangements (including allowing payments made
with respect to services provided by the hospital or station to be
made directly to that hospital or station) as may be necessary to
effect a timely and orderly transfer of such hospital or station
(including the land, building, and equipment thereof) from the
Service, or for the financial self-sufficiency of the hospital or
station, not later than September 30,1982.
(e) There is established, within the Office of the Assistant Secretary
for Health of the Department of Health and Human Services, an
identifiable administrative unit which shall have direct responsibili-
ty and authority for overseeing the activities under this section.
(f) For purposes of this section, a hospital or station cannot be found
to be financially self-sufficient if the hospital or station is relsdng, in
whole or in part, on direct appropriated funds for its continued
operations.
CONTINUED CARE FOR MERCHANT SEAMEN HOSPITAUZED IN PUBLIC
HEALTH SERVICE HOSPITALS
42 use 249 note. SEC. 988. (a) The Secretary shall provide, by contract or other
arrangement with a Federal entity and without charge but subject to
subsection (h), for the continuation of inpatient hospital services (and
outpatient services related to the condition of hospitalization) to any
individual who—
(1) on September 30, 1981, is receiving inpatient hospital
services at a Public Health Service hospital on the basis of the
entitlement contained in section 322(a) of the Public Health
Service Act (42 U.S.C. 249(a)), as such section was in effect on
such date, for treatment of a condition,
(2) requires continued hospitalization after such date for treat-
ment of that condition (or requires outpatient services related to
such condition), and
(3) the Secretary determines has no other source of inpatient
hospital services available for continued treatment of that condi-
tion.
(b) Services may not be provided under subsection (a) to an
individual after the earlier of—
(1) September 30,1982,
(2) the end of the first 60-day consecutive period (beginning
after September 30,1981) during the entire period of which the
individual is not an inpatient of a hospital.
(c) Notwithstanding any other provision of law, the head of any
Federal department or agency which provides, under other authority
of law and through federal facilities, inpatient hospital services or
outpatient services, or both, is authorized to provide inpatient hospi-
tal services (and related outpatient services) to individuals under
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 605
contract or other arrangement with the Secretary pursuant to this
section.
Subtitle K—Office of the Secretary of Health and
Human Services
APPROPRIATIONS FOR IMMEDIATE OFFICE OF SECRETARY OF HEALTH
AND HUMAN SERVICES
SEC. 991. The appropriations for the immediate office of the 42USC350i
Secretary of Health and Human Services and the Under Secretary of "°^®
Health and Human Services for the executive direction of the
Department of Health and Human Services may not exceed
$4,125,000 for fiscal year 1982, may not exceed $4,485,000 for fiscal
year 1983, and may not exceed $4,875,000 for fiscal year 1984. Before
the Secretary may request additional funds for the office of the
Secretary or the Under Secretary or request the reprograming to
such offices of appropriated fimds, the Secretary shall consult with
the Committee on Energy and Commerce of the House of Representa-
tives.
TITLE X—ENERGY AND ENERGY-
RELATED PROGRAMS
Subtitle A—Department of Energy Authorization
CHAPTER 1-CIVILIAN RESEARCH AND DEVELOPMENT
AUTHORIZATION
OPERATING EXPENSES
SEC. 1001. Funds are hereby authorized to be appropriated in 42 use 7270
accordance with section 660 of the Department of Energy Organiza- ^
tion Act for operating expenses for the civilian research and develop- ^^ use 7270.
ment programs of the Department of Energy for the following
appropriations accounts;
(1) Greneral science and research activities,
(A) for the fiscal year ending on September 30, 1982,
$439,160,000;
(B) for the fiscal year ending on September 30, 1983,
$471,000,000; and
(C) for the fiscal year ending on September 30, 1984,
$500,000,000.
(2) Energy supply, research and development activities,
(A) for the fiscal year ending on September 30, 1982,
$2,057,460,000;
(B) for the fiscal year ending on September 30, 1983,
$2,141,000,000 including programs authorized in section
1007(a)(3XA);and
(C) for the fiscal year ending on September 30, 1984,
$2,258,000,000 including programs authorized in section
1007(a)(3)(A).
(3) Uranium supply and enrichment activities (advanced iso-
tope separation), for the fiscal year ending on September 30,
1982, $80,292,000.
95 STAT. 606 PUBLIC LAW 97-35—AUG. 13, 1981
(4) Geothermal resources development fund: geothermal loan
guarantee and interest assistance program,
(A) for the fiscal year ending on September 30, 1982,
$200,000;
(B) for the fiscal year ending on September 30, 1983,
$200,000; and
(C) for the fiscal year ending on September 30, 1984,
$200,000.
(5) Fossil energy research and development, including capital
equipment not related to construction,
(A) for the fiscal year ending on September 30, 1982,
$460,800,000;
(B) for the fiscal year ending on September 30, 1983,
$430,800,000; and
(C) for the fiscal year ending on September 30, 1984,
$430,800,000.
(6) Energy conservation research and development, including
capital equipment not related to construction,
(A) for the fiscal year ending on September 30, 1982,
$149,444,000;
(B) for the fiscal year ending on September 30, 1983,
$154,000,000; and
(C) for the fiscal year ending on September 30, 1984,
$158,600,000.
PLANT AND CAPITAL EQUIPMENT GENERALLY
42 use 7270 SEC. 1002. Funds are hereby authorized to be appropriated in
^°^^- accordance with section 660 of the Department of E n e r ^ Orgginiza-
42 use 7270. tion Act for construction, including planning, construction, acquisi-
tion, or modification of facilities, including land acquisition; and
acquisition and fabrication of captial equipment not related to
construction of the Department of Energy for the following appropri-
ations accounts:
(1) General science and research activities,
(A) for the fiscal year ending on September 30, 1982,
$128,300,000 including the amounts authorized to be appro-
priated in sections 1003 and 1004(aX3);
(B) for the fiscal year ending on September 30, 1983,
$137,000,000; and
(C) for the fiscal year ending on September 30, 1984,
$147,000,000.
(2) Energy supply, research and development activities,
(A) for the fiscal year ending on September 30, 1982,
$370,132,000 including the amounts authorized to be appro-
priated in sections 1003 and 1004(aX2);
(B) for the fiscal year ending on September 30, 1983,
$354,000,000; and
(C) for the fiscal year ending on September 30, 1984,
$416,200,000.
(3) Fossil energy construction,
(A) for the fiscal year ending on September 30, 1982,
$18,000,000 including the amounts authorized to be appro-
priated in sections 1003 and 1004(aXl);
(B) for the fiscal year ending on September 30, 1983,
$13,000,000; and
(C) for the fiscal year ending on September 30, 1984,
$6,000,000.
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 607
PRIOR YEAR CONSTRUCTION
SEC. 1003. (a) Of the amounts authorized to be appropriated for 42 use 7270
fiscal year 1982 by sections 1001 and 1002, there are authorized to be "°*®
appropriated in accordance with section 660 of the Department of
Energy Organization Act for construction (including planning, con- 42 USC 7270.
struction, acquisition, and modification of facilities, including land
acquisition), and for acquisition and fabrication of capital equipment
not related to construction, with respect to each prior year project
listed in the budget documents submitted to the Congress in support
of the fiscal year 1982 budget, amounts not to exceed the appropri-
ations amount requested for such project for fiscal year 1982 as set
forth in such budget documents, except as otherwise provided (in the
case of specific projects) under subsection (b).
(b) The amounts otherwise authorized by subsection (a) to be
appropriated for fiscal year 1982 or previously authorized are in-
creased or decreased as follows:
(1) Fossil energy research and development:
(A) in the case of acquisition and fabrication of capital
equipment not related to construction, the amount so au-
thorized for fossil energy research and development is de-
creased by $800,000;
(2) Energy supply research and development:
(A) in the case of acquisition and fabrication of capital
equipment not related to construction, the amount so au-
thorized for energy supply, research, and development activ-
ities is increased by $1,000,000;
(B) in the case of Project 81-ES-l, OTEC 40MW Pilot
Plant, the amount previously authorized is increased by
$6,300,000, for a total project authorization of $36,300,000;
(C) in the case of Project 81-T-314, Impurity Studies
Experiment Modification (ISX-C), Oak Ridge, Tennessee,
the amount previously authorized is increased by $3,500,000,
for a total project authorization of $7,000,000;
(D) in the case of Project 80-ES-19,250KW, Small Commu-
nity Solar Thermal Power Experiment, the amount previ-
ously authorized is increased by $4,000,000, for a total project
authorization of $8,180,000;
(E) in the case of Project 80-G-2, Second 50 MWe Demon-
stration Power Plant, Heber, Imperial Valley, California,
the amount previously authorized is increased by
$11,000,000, for a total project authorization of $19,000,000;
(F) in the case of Project 78-6-f, Fuels and Materials
Examination Facility, Hanford, Washington, the amount
previously authorized is increased by $17,800,000, for a total
project authorization of $176,800,000; and
(G) in the case of Project 78-3-b, Mike McCormack Fusion
Materials Irradiation Test Facility, Hanford, Washington,
the amount previously authorized is increased by
$14,000,000, for a total project authorization of $47,000,000.
(3) Energy conservation:
(A) in the CEise of acquisition and fabrication of capital
equipment not related to construction, the amount so au-
thorized for energy conservation is increased by $326,000.
(c) For purposes of this section, the terms "budget documents Definitions.
submitted to the Congress in support of the fiscal year 1982 budget"
and "budget documents" mean the Department of Energy Congres-
95 STAT. 608 PUBLIC LAW 97-35—AUG. 13, 1981
sional Budget Request, Fiscal Year 1982 (February 1981; DOE/
CR-0011-3).
NEW CONSTRUCTION
42 use 7270 SEC. 1004. (a) Of the amounts appropriated for fiscal year 1982
^°^^- pursuant to the authorization provided in section 1002, funds may be
expended for new plant and capital equipment activities, including
planning, construction, acquisition, or modification of facilities, in-
cluding land acquisition. The following new plant and capital equip-
ment activities are hereby authorized in an amount not to exceed the
Federal share of the total estimated cost set forth for each project in
budget documents submitted to the Congress in support of the fiscal
year 1982 budget. Within such amounts the authorizations for the
new plant and capital equipment activities for fiscal year 1982 are
limited as follows:
(1) Fossil energy construction:
(A) Project 82-F-506, Surface Water Containment and
Waste Water Treatment Facility, Pittsburgh Energy Tech-
nology Center, Bruceton, Pennsylvania, $1,000,000; and
(B) Project 82-F-505, General plant projects for technology
centers, six locations, $6,000,000; and
(2) Energy supply research and development:
(A) Nuclear fission activities:
(i) Project 82-N-315, General plant projects, Richland,
Washington, and other sites, $1,100,000;
(ii) Project 82-N-310, Modification to reactors, various
locations, $2,000,000; and
(iii) Project 82-N-312, General plant projects,
$11,000,000.
(B) Magnetic fusion activities:
(i) Project GPP-82, General plant projects, Princeton,
New Jersey, and Oak Ridge, Tennessee, $5,700,000.
(C) Supporting research and technical analysis activities:
(i) Project 82-E-322, High Temperature Materials
Laboratory, Oak Ridge National Laboratory, Oak Ridge,
Tennessee, $3,500,000;
(ii) Project 82-E-321, Accelerator Improvements and
Modifications, various locations, $300,000;
(iii) Project 82-E-320, General plant projects, various
locations, $300,000;
(iv) Project 82-E-301, 300 area critical utilities up-
grading, Richland, Washington, $1,000,000;
(v) Project 82-E-302, Security Facility, Argonne Na-
tional Laboratory, Argonne, Illinois, $1,500,000;
(vi) Project 82-E-305, Traffic safety improvements,
Richland, Washington, $3,800,000;
(vii) Project 82-E-306, Railroad modifications, Idaho
National Engineering Laboratory, Idaho, $2,000,000.
(D) Environmental research and development activities:
(i) Project 82-GPP-l, General plant projects,
$3,000,000; and
(ii) Project 82-V-305, Modifications and additions to
environmental research facilities, various locations,
$1,000,000.
(3) General science and research activities:
(A) High energy physics activities:
(i) Project 82-E-206, Tevatron II, Fermi National
Accelerator Laboratory, Batavia, Illinois, $6,000,000;
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 609
(ii) Project 82-E-205, Accelerator improvements and
modifications, various locations, $7,000,000; and
(iii) Project 82-E-204, General plant projects, various
locations, $6,000,000;
(B) Nuclear physics activities:
(i) Project 82-E-223, Argonne Tandem-Linac Accel-
erator System (ATLAS), Argonne National Laboratory,
Argonne, Illinois, $4,000,000;
(ii) Project 82-EJ-221, Accelerator improvements and
modifications, various locations $2,000,000; and
(iii) Project 82-E-222, General plant projects, various
locations, $2,800,000. Definitions.
(b) For purposes of this section, the terms "budget documents
submitted to the Congress in support of the fiscal year 1982 budget"
and "budget documents" mean the Department of Energy C!ongres-
sional Budget Request, Fiscal Year 1982 (February 1981; DOE/
CR-0011-3).
CHAPTER 2-CONSERVATION, INFORMATION, AND
REGULATION
AUTHORIZATIONS FOR FISCAL YEARS 1982, 1983, AND 1984
SEC. 1005. Funds are hereby authorized to be appropriated in 42 use 7270
accordance with section 660 of the Department of Energy Organiza- ^°^-
tion Act for operating expenses for— ^2 use 7270.
(1) Energy conservation,
(A) for the fiscal year ending on September 30, 1982,
$363,056,000;
(B) for the fiscal year ending on September 30, 1983,
$387,400,000; and
(C) for the fiscal year ending on September 30, 1984,
$399,000,000.
(2) Regulation and information activities—
(A) for the fiscal year ending on September 30, 1982,
including—
(i) for economic regulation, $44,600,000;
(ii) for the Federal Energy Regulatory Commission,
$80,400,000; and
(iii) for the Energy Information Administration,
$84,986,000;
(B) for the fiscal year ending on September 30, 1983,
$265,000,000; and
(C) for the fiscal year ending on September 30, 1984,
$275,000,000.
(3) Strategic Petroleum Reserve, to carry out part B of title I of
the Energy Policy and Conservation Act, except acquisition,
transportation, and injection of petroleum products for the
Reserve and the carrying out of any drawdown and distribution
of the Reserve—
(A) for the fiscal year ending September 30, 1983,
$366,319,000; and
(B) for the fiscal year ending on September 30, 1984,
$864,429,000.
95 STAT. 610 PUBLIC LAW 97-35—AUG. 13, 1981
CHAPTER 3—POWER MARKETING ADMINISTRATIONS
42 use 7270 SEQ. 1006. Funds are hereby authorized to be appropriated in
"°^®- accordance w i t h section 660 of t h e D e p a r t m e n t of E n e r g y Organiza-
42 u s e 7270. tion Act for t h e ci\dlian p r o g r a m s of t h e D e p a r t m e n t of E n e r g y for
the following appropriations accounts:
(1) Alaska Power Administration operation and maintenance,
(A) for the fiscal year ending on September 30, 1982,
$3,538,000 of which $50,000 shall be reserved for an emergen-
cy fund to £issure continuous operations during unusual or
emergency conditions;
(B) for the fiscal year ending on September 30, 1983,
$3,374,000; and
(C) for the fiscal year ending on September 30, 1984,
$3,374,000.
(2) Southeastern Power Administration operation and mainte-
nance,
(A) for the fiscal year ending on September 30, 1982,
$7,237,000;
(B) for the fiscal year ending on September 30, 1983,
$11,848,000; and
(C) for the fiscal year ending on September 30, 1984,
$24,240,000.
(3) Southwestern Power Administration operation mainte-
nance,
(A) for the fiscal year ending on September 30, 1982,
$20,239,000;
(B) for the fiscal year ending on September 30, 1983,
$38,119,000; and
(C) for the fiscal year ending on September 30, 1984,
$40,254,000.
(4) Western Area Power Administration construction rehabili-
tation, operation and maintenance,
(A) for the fiscal year ending on September 30, 1982,
$210,774,000;
(B) for the fiscal year ending on September 30, 1983,
$226,400,000; and
(C) for the fiscal year ending on September 30, 1984,
$259,700,000.
(5) Western Area Power Administration emergency fund,
(A) for the fiscal year ending on September 30, 1982,
$500,000;
(B) for the fiscal year ending on September 30, 1983,
$500,000; and
(C) for the fiscal year ending on September 30, 1984,
$500,000.
CHAPTER 4—OTHER ACTIVITIES
OPERATING EXPENSES
42 use 7270 SEC. 1007. (a) Funds are hereby authorized to be appropriated in
^°^- accordance with section 660 of the Department of Energy Organiza-
tion Act for operating expenses—
(1) uranium supply and enrichment activities,
(A) other than advanced isotope separation, for the fiscal
year ending on September 30,1982, for—
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 611
(i) gaseous diffusion operations and support,
$961,825,000;
(ii) gas centrifuge operations and support, $5,200,000;
(iii) uranium enrichment process development,
$93,075,000;
(iv) pro-am administration, $3,100,000; and
(v) uranium resource assessment, $9,700,000;
(B) including advanced isotope separation, for the fiscal
year ending on September 30, 1983, $1,621,600,000; and
(C) including advanced isotope separation, for the fiscal
year ending on September 30,1984, $1,973,600,000.
(2) Department administration,
(A) for the fiscal year ending on September 30, 1982,
$206,000,000;
(B) for the fiscal year ending on September 30, 1983,
$246,963,000, including plant and capital equipment; and
(C) for the fiscal year ending on September 30, 1984,
$246,963,000, including plant and capital equipment.
(3) Energy supply research and development,
(A) solar and hydropower for the fiscal year ending on
September 30,1982, $11,700,000; and
(B) commercial waste management,
(i) other than programs authorized in section
10()1(2)(A), for the fiscal year ending on September 30,
1982, $67,370,000;
(ii) for the fiscal year ending on September 30, 1983,
$284,148,000; and
(iii) for the fiscal year ending on September 30,1984,
$300,000,000.
(4) Energy conservation, including capital equipment not relat-
ed to construction,
(A) for the fiscal year ending on September 30, 1982,
$32,600,000;
(B) for the fiscal year ending on September 30, 1983,
$33,600,000; and
(C) for the fiscal year ending on September 30, 1984,
$34,600,000.
(5) Energy production, demonstration, and distribution,
(A) for the fiscal year ending on September 30, 1982,
$230,963,000;
(B) for the fiscal year ending on September 30, 1983,
$377,195,000; and
(C) for the fiscal year ending on September 30, 1984,
$292,305,000.
(h) Any State receiving financial assistance for energy extension
service activities pursuant to the National Energy Extension Service
Act shall be required to provide funds from non-Federal sources for
such activities in an amount no less than 20 per centum of the
amount allocated to such State under such Act during any fiscal year.
PLANT AND CAPITAL EQUIPMENT GENERALLY
SEC. 1008. Funds are hereby authorized to be appropriated in 42 use 7270
accordance with section 660 of the Department of E n e r ^ Organiza- "°^
tion Act for construction, including planning, construction, acquis!- 42 use 7270.
tion, or modification of facilities, including land acquisition; and
acquisition and fabrication of capital equipment not related to
95 STAT. 612 PUBLIC LAW 97-35—AUG. 13, 1981
construction of the Department of Energy for the following appropri-
ations accounts:
(1) Uranium supply and enrichment activities, including
research and development activities,
(A) for the fiscal year ending on September 30, 1982,
(i) $748,250,000 including the amounts authorized in
sections 1009 and lOlO(aXl), and
(ii) $200,000 for uranium resource assessment, capital
equipment not related to construction;
(B) for the fiscal year ending on September 30, 1983,
$1,002,800,000; and
(C) for the fiscal year ending on September 30, 1984,
$981,500,000.
(2) Department administration,
(A) for the fiscal year ending on September 30, 1982,
$40,963,000 including the amounts authorized in sections
1009(a) and 1010(a)(2).
(3) Energy supply research and development, commercial
waste management,
(A) for the fiscal year ending on September 30, 1982,
$975,000.
PRIOR YEAR CONSTRUCTION
42 use 7270 SEC. 1009. (a) Of the amounts authorized to be appropriated for
"°*®- fiscal year 1982 by section 1008, there are authorized to be appropri-
ated in accordance with section 660 of the Department of Energy
42 use 7270. Organization Act for construction (including planning, construction,
acquisition, and modification of facilities, including land acquisition),
and for acquisition £ind fabrication of capital equipment not related
to construction, with respect to each prior year project listed in the
budget documents submitted to the Congress in support of the fiscal
year 1982 budget amounts not to exceed the appropriations amount
requested for such project for fiscal year 1982 as set forth in such
budget documents, except as otherwise provided (in the case of
specific projects) under subsection (b).
(b) The amounts authorized to be appropriated for fiscal year 1982
with respect to the following projects are as follows:
(1) Uranium supply and enrichment activities,
(A) Project 80-UE-5, Motor and switchgear upgrading,
gaseous diffusion plants, the amount previously authorized
is increased by $6,600,000 for a total project authorization of
$26,500,000; and
(B) Project 76-8-g, Enriched uranium production facilities,
Portsmouth, Ohio, the amount previously authorized is
increased by $601,()00,000 for a total project authorization of
$1,552,845,000.
Definitions. (c) For purposes of this section, the terms "budget documents
submitted to the Congress in support of the fiscal year 1982 budget"
and "budget documents" mean the Department of Energy Congres-
sional Budget Request, Fiscal Year 1982 (February 1981; DOE/
CR-0011-3).
NEW CONSTRUCTION
42 use 7270 SEC. 1010. (a) Of the amounts appropriated for fiscal year 1982
" pursuant to the authorization provided in section 1008, funds may be
expended for new plant and capital equipment activities, including
planning, construction, acquisition, or modification of facilities,
including land acquisition. The following new plant and capital
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 613
equipment activities are hereby authorized in an amount not to
exceed the Federal share of the total estimated cost set forth for each
project in budget documents submitted to the Congress in support of
the fiscal year 1982 budget. Within such amounts the authorizations
for the new plant and capital equipment activities for fiscal year 1982
are limited as follows:
(1) Uranium supply and enrichment activities,
(A) Project 82-R-410, General plant projects, various loca-
tions, including Grand Junction, Colorado, $17,600,000;
(B) Project 82-R-411, UF6 cylinders and storage yards,
gaseous diffusion plants, $11,000,000;
(C) Project 82-R-412, Cooling tower modifications. Oak
Ridge, Tennessee and Portsmouth, Ohio, gaseous diffusion
plants, $8,000,000;
(D) Project 82-R-413, Improved UF6 containment and
gaseous diffusion plants, $7,100,000;
(E) Project 82-R-414, Purge and cascade withdrawal modi-
fications, gaseous diffusion plant, Paducah, Kentucky,
$9,000,000;
(F) Project 82-R-415, Fire alarm system replacement,
gaseous diffusion plants, $4,700,000;
(G) Project 82-R-416, Environmental protection and
safety modifications, Phase II, gaseous diffusion plants,
$2,000,000;
(H) Project 82-R-417, Air distribution system upgrading,
gaseous diffusion plant, Paducah, Kentucky, $2,700,000;
(I) Project 82-R-418, Advanced Centrifuge Test Facilities,
Oak Ridge, Tennessee, $6,000,000; and
(J) Project 82-N-402, General plant projects, various loca-
tions, $650,000.
(2) Departmental administration,
(A) Project 82-A-601, Modifications for energy manage-
ment, various locations, $14,100,000;
(B) Project 82-A-602, Advanced Test Reactor (ATR) waste
heat recovery, Idaho National Engineering Laboratory,
Idaho, $4,900,000;
(C) Project 82-A-603, High temperature water distribu-
tion system, Los Alamos Scientific Laboratory, New Mexico,
$5,000,000;
(D) Project 82-C-601, Plcmt engineering and design, var-
ious locations, $2,000,000; and
(E) Capital equipment not related to construction for
departmental administration activities, $5,563,000.
0)) For purposes of this section, the terms "budget documents Definitions.
submitted to the Congress in support of the fiscal year 1982 budget"
and "budget documents" mean the Department of Energy Congres-
sional Budget Request, Fiscal Year 1982 (February 1981; DOE/
CR-0011-3).
GENERAL REQUIREMENT
SEC. 1011. (a) At the same time that the President submits his
budget to the Congress for fiscal years 1983 and 1984 for the
Department of Enermr as required by the Budget and Accounting
Act, 1921, there shall be submitted, in addition to any other existing 31 use i.
requirements, a tabular listing for the recommended level of program
activity and subactivity funding the fiscal years 1983 and 1984 of
civilian energy activities in the same format as is contained in the
program tables relating to this title appearing in the statement of
95 STAT. 614 PUBLIC LAW 97-35—AUG. 13, 1981
managers aocompanyiiig the conference report on the Omnibus
Budget Reconciliation Act of 1981 (H.R. 3982; 97th Congress).
(b) At the same time that the President submits his budget to the
Congress those plant and capital amounts requested for that fiscal
year, additional authorization requested for prior year projects, and
any new construction requests shall also be submitted as a separate
request for authorization of appropriations for civilian research and
development activities.
CHAPTER 5—UNITED STATES ENERGY TARGETS
ENERGY TARGETS
SEC. 1012. United States energy targets:
ENERGY TARGETS
[Quadrillion Btu's per year]
1985 1990 1995 2000
Domestic production:
OilandNGL 18 17 18 18
Natural gas 18 18 16 15
Coal 21 27 82 41
Nuclear 5 7 8 9
Hydro geothermal 3 4 4 4
Renewables 2 3 5 6_
Subtotal 67 76 83 93
Imports:
OU 18 14 11 7
Natural gas 2 3 3 2
Coal -1.8 -2.1 -2.2 -2.4
Subtotal 18 15 11 7
Total supply 85 90 94 100
End-use consumption:
Petroleum liquids 32 29 28 27
Gas 17 18 18 18
Direct coal 5 6 6 7
Electricity 9 10 11 12
Decentralized solar.— 2 3 4 5_
Subtotal 64 66 67 68
Conversion losses.... 21 25 28 32
Stock increase
Total consumption 85 91 94 100
Subtitle B—Powerplant and Industrial Fuel Use Act of
1978 Provisions
APPUCABIUTY OF FUEL USE RESTRICTIONS TO CERTAIN EXISTING
ELECTRIC POWERPLANTS
SEC. 1021. (a) Title m of the Powerplant and Industrial Fuel Use
Act of 1978 is amended by striking out section 301 (42 U.S.C. 8341) and
inserting in lieu thereof the following:
PUBLIC LAW 97-35—AUG. 13, 1981 95 STAT. 615
"SEC. 301. EXISTING ELECTRIC POWERPLANTS.
"(a) CERTIFICATION BY POWERPLANTS OF COAL CAPABILITY.—At any
time, the owner or operator of an existing electric powerplant may
certify to the Secretary, for purposes of subsection (b)—
"(1) whether or not such powerplant has or previously had the
technical capability to use coal or another alternate fuel as a
primary energy source;
"(2) whether or not such powerplant could have the technical
capability to use coal or another alternate fuel as a primary
energy source without having—
"(A) substantial physical modification of the powerplant,
or
"(B) substantial reduction in the rated capacity of the
powerplant; and
"(3) whether or not it is financially feasible to use coal or
another alternate fuel as a primary energy source in such a
powerplant.
"(b) AUTHORITY OF SECRETARY TO PROHIBIT WHERE COAL OR ALTER-
NATE FUEL CAPABILITY EXISTS.—The Secretary may prohibit, in
accordance with section 303(a) or (b), the use of petroleum or natural 42 use 8343.
gas, or both, as a primary energy source in any existing electric
powerplant, if an affirmative certification under subsection (aXD, (2),
and (3) is in effect with respect to such powerplant and if, after
examining the basis for the certification, the Secretary concurs with
the certification.
"(c) AUTHORITY OF SECRETARY TO PROHIBIT EXCESSIVE U S E IN
MIXTURES.—At any time, the owner or operator of an existing electric
powerplant may certify to the Secretary for purposes of this subsec-
tion whether or not it is technically and financially feasible to use a
mixture of petroleum or natural gas and coal or another alternate
fuel as a primary energy source in that powerplant. If an affirma