S 1533 IS
104th CONGRESS
2d Session
S. 1533
To provide an opportunity for community renewal and economic growth in empowerment zones and enterprise communities, and for other purposes.
IN THE SENATE OF THE UNITED STATES
January 26, 1996
Mr. MCCAIN introduced the following bill; which was read twice and referred to the Committee on Finance
A BILL
To provide an opportunity for community renewal and economic growth in empowerment zones and enterprise communities, and for other purposes.
Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS; BUDGET EFFECT.
(a) SHORT TITLE- This Act may be cited as the `Community Renewal and Economic Opportunity Act'.
(b) TABLE OF CONTENTS- The table of contents for this Act is as follows:
Sec. 1. Short title; table of contents; budget effect.
TITLE I--ECONOMIC OPPORTUNITY
Subtitle A--Tax Incentives
Sec. 101. General tax credit for businesses in empowerment zones and enterprise communities.
Sec. 102. Election of flat tax option for zone and community businesses.
Sec. 103. Exclusion for capital gains on certain investments within zones and communities.
Sec. 104. Increase in expensing under section 179 for businesses in zones and communities.
Sec. 105. Tax-free dividends received from enterprise zone businesses.
Sec. 106. Work opportunity tax credit.
Subtitle B--Contracting Set-Aside Reform
Sec. 111. Amendments to the Small Business Act.
Sec. 112. Technical and conforming amendments in other law.
Sec. 113. Savings provision.
Sec. 114. Additional technical and conforming amendments.
Subtitle C--Small Business Mentor Program
Sec. 121. Establishment of mentor program.
TITLE II--COMMUNITY INFRASTRUCTURE
Sec. 201. Limitation on the application of the Davis-Bacon requirements to empowerment zones, enterprise communities, and enterprise zones.
Sec. 202. Reform of community development block grant program.
TITLE III--SAFE STREETS
Subtitle A--Mandatory Restitution
Sec. 301. Order of restitution.
Sec. 302. Conditions of probation.
Sec. 303. Mandatory restitution.
Sec. 304. Order of restitution to victims of other crimes.
Sec. 305. Procedure for issuance and enforcement of restitution order.
Sec. 307. Instruction to Sentencing Commission.
Sec. 308. Justice Department regulations.
Sec. 309. Special assessments on convicted persons.
Sec. 310. Crime victims fund.
Sec. 311. Victims of terrorism act.
Sec. 313. Study and report.
Sec. 314. Effective date.
Subtitle B--Asset Forfeiture Assistance
Sec. 321. Forfeitures under the Controlled Substances Act.
TITLE IV--EDUCATIONAL OPPORTUNITY
Sec. 404. Program authorized.
Sec. 405. Authorized projects.
Sec. 407. Education certificates.
Sec. 408. Effect on other programs; use of school lunch data.
Sec. 409. Parental notification.
Sec. 410. Evaluation and report.
TITLE V--FAMILY OPPORTUNITY
Sec. 501. Findings and purpose.
Sec. 502. Removal of barriers to interracial and interethnic adoptions.
Sec. 504. Effective date.
TITLE VI--VOLUNTEER PROTECTION
Sec. 601. Findings and purpose.
Sec. 603. No preemption of State tort law.
Sec. 604. Limitation on liability for volunteers.
Sec. 605. Certification requirement and adjustment of social services block grant allotments.
TITLE VII--SPECTRUM AUCTION
Sec. 701. Auction of electromagnetic spectrum.
(c) SENSE OF THE SENATE REGARDING BUDGET NEUTRALITY- It is the sense of the Senate that appropriate reductions in Federal budget spending levels should be made in order to enact in a budget neutral manner the provisions of, and amendments made by, this Act.
TITLE I--ECONOMIC OPPORTUNITY
Subtitle A--Tax Incentives
SEC. 101. GENERAL TAX CREDIT FOR BUSINESSES IN EMPOWERMENT ZONES AND ENTERPRISE COMMUNITIES.
(a) IN GENERAL- Part II of subchapter U of chapter 1 of the Internal Revenue Code of 1986 (relating to designation and treatment of empowerment zones, enterprise communities, and rural development investment areas) is amended by adding at the end the following new section:
`SEC. 1395. GENERAL TAX CREDIT.
`(a) IN GENERAL- In the case of an enterprise zone business, there shall be allowed as a credit against the tax imposed by this chapter for the taxable year an amount equal to 10 percent of such tax (determined without regard to this section).
`(b) ENTERPRISE ZONE BUSINESS- For purposes of this section, the term `enterprise zone business' has the meaning given to such term by section 1394(b)(3), except that in the case of empowerment zones, subsections (b)(6) and (c)(5) of section 1397B shall be applied by substituting `50 percent' for `35 percent'.
`(c) DESIGNATION OF ADDITIONAL ENTERPRISE COMMUNITIES FOR TAX CREDIT AND FLAT TAX OPTION- For purposes of the credit allowed under this section and the flat tax option under section 1395A only, and notwithstanding subsections (b)(1) and (c) of section 1391(b)(1), the Secretary of Housing and Urban Development may designate 90 additional enterprise communities in urban areas under section 1391.'.
(b) Conforming Amendments-
(1) Part II of subchapter U of chapter 1 of the Internal Revenue Code of 1986 is amended to read as follows:
`PART II--INCENTIVES FOR EMPOWERMENT ZONES AND ENTERPRISE COMMUNITIES.'.
(2) The table of parts of subchapter U of chapter 1 of such Code is amended to read as follows:
`Part II. Incentives for empowerment zones and enterprise communities.'.
(3) The table of sections of part II of subchapter U of chapter 1 of such Code is amended by adding at the end the following new item:
`Sec. 1395. General tax credit.'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1996.
SEC. 102. ELECTION OF FLAT TAX OPTION FOR ZONE AND COMMUNITY BUSINESSES.
(a) IN GENERAL- Part II of subchapter U of chapter 1 of the Internal Revenue Code of 1986, as amended by section 101, is amended by adding at the end the following new section:
`SEC. 1395A. FLAT TAX OPTION.
`(a) IN GENERAL- An enterprise zone business may elect for any taxable year the flat tax option.
`(b) FLAT TAX OPTION- For purposes of this section, the term `flat tax option' means, with respect to any taxable year--
`(1) no credit otherwise allowable to the taxpayer under this subchapter or part IV of subchapter A shall be allowed,
`(2) part VI of subchapter A (relating to the alternative minimum tax) shall not apply to the taxpayer, and
`(3) section 11 shall apply to the taxpayer as if amended to read as follows:
`SEC. 11. TAX IMPOSED ON BUSINESS ACTIVITIES.
`(a) TAX IMPOSED- There is hereby imposed on every person engaged in a business activity a tax equal to 10 percent of the business taxable income of such person.
`(b) LIABILITY FOR TAX- The tax imposed by this section shall be paid by the person engaged in the business activity, whether such person is an individual, partnership, corporation, or otherwise.
`(c) BUSINESS TAXABLE INCOME- For purposes of this section--
`(1) IN GENERAL- The term `business taxable income' means gross active income reduced by the deductions specified in subsection (d).
`(2) GROSS ACTIVE INCOME-
`(A) IN GENERAL- For purposes of paragraph (1), the term `gross active income' means gross receipts from--
`(i) the sale or exchange of property or services in the United States by any person in connection with a business activity, and
`(ii) the export of property or services from the United States in connection with a business activity.
`(B) EXCHANGES- For purposes of this section, the amount treated as gross receipts from the exchange of property or services is the fair market value of the property or services received, plus any money received.
`(C) COORDINATION WITH SPECIAL RULES FOR FINANCIAL SERVICES, ETC- Except as provided in subsection (e)--
`(i) the term `property' does not include money or any financial instrument, and
`(ii) the term `services' does not include financial services.
`(3) EXEMPTION FROM TAX FOR ACTIVITIES OF GOVERNMENTAL ENTITIES AND TAX-EXEMPT ORGANIZATIONS- For purposes of this section, the term `business activity' does not include any activity of a governmental entity or of any other organization which is exempt from tax under this chapter.
`(1) IN GENERAL- The deductions specified in this subsection are--
`(A) the cost of business inputs for the business activity,
`(B) wages (as defined in section 3121(a) without regard to paragraph (1) thereof) which are paid in cash for services performed in the United States as an employee, and
`(C) retirement contributions to or under any plan or arrangement which makes retirement distributions (as defined in section 63(c)) for the benefit of such employees to the extent such contributions are allowed as a deduction under section 404.
`(A) IN GENERAL- For purposes of paragraph (1), the term `cost of business inputs' means--
`(i) the amount paid for property sold or used in connection with a business activity,
`(ii) the amount paid for services (other than for the services of employees, including fringe benefits paid by reason of such services) in connection with a business activity, and
`(iii) any excise tax, sales tax, customs duty, or other separately stated levy imposed by a Federal, State, or local government on the purchase of property or services which are for use in connection with a business activity.
Such term shall not include any tax imposed by chapter 2 or 21.
`(B) EXCEPTIONS- Such term shall not include--
`(i) items described in subparagraphs (B) and (C) of paragraph (1), and
`(ii) items for personal use not in connection with any business activity.
`(C) EXCHANGES- For purposes of this section, the amount treated as paid in connection with the exchange of property or services is the fair market value of the property or services exchanged, plus any money paid.
`(e) SPECIAL RULES FOR FINANCIAL INTERMEDIATION SERVICE ACTIVITIES- In the case of the business activity of providing financial intermediation services, the taxable income from such activity shall be equal to the value of the intermediation services provided in such activity.
`(f) EXCEPTION FOR SERVICES PERFORMED AS EMPLOYEE- For purposes of this section, the term `business activity' does not include the performance of services by an employee for the employee's employer.
`(g) CARRYOVER OF EXCESS DEDUCTIONS-
`(1) IN GENERAL- If the aggregate deductions for any taxable year exceed the gross active income for such taxable year, the amount of the deductions specified in subsection (d) for the succeeding taxable year (determined without regard to this subsection) shall be increased by the sum of--
`(B) the product of such excess and the 3-month Treasury rate for the last month of such taxable year.
`(2) 3-MONTH TREASURY RATE- For purposes of paragraph (1), the 3-month Treasury rate is the rate determined by the Secretary based on the average market yield (during any 1-month period selected by the Secretary and ending in the calendar month in which the determination is made) on outstanding marketable obligations of the United States with remaining periods to maturity of 3 months or less.'
`(c) ENTERPRISE ZONE BUSINESS- For purposes of this section, the term `enterprise zone business' has the meaning given to such term by section 1394(b)(3), except that subsections (b)(6) and (c)(5) of section 1397B shall be applied by substituting `50 percent' for `35 percent'.'.
(b) CONFORMING AMENDMENT- The table of sections of part II of subchapter U of chapter 1 of such Code, as amended by section 101, is amended by adding at the end the following new item:
`Sec. 1395A. Flat tax option.'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1996.
SEC. 103. EXCLUSION FOR CAPITAL GAINS ON CERTAIN INVESTMENTS WITHIN ZONES AND COMMUNITIES.
(a) IN GENERAL- Part II of subchapter U of chapter 1 of the Internal Revenue Code of 1986, as amended
by sections 101 and 102, is amended by adding at the end the following new section:
`SEC. 1395B. EXCLUSION FOR GAIN FROM ZONE OR COMMUNITY INVESTMENTS.
`(a) GENERAL RULE- In the case of an individual, gross income shall not include any qualified capital gain recognized on the sale or exchange of a qualified zone asset held for more than 5 years.
`(b) QUALIFIED ZONE ASSET- For purposes of this section--
`(1) IN GENERAL- The term `qualified zone asset' means--
`(A) any qualified zone stock,
`(B) any qualified zone property, and
`(C) any qualified zone partnership interest.
`(2) QUALIFIED ZONE STOCK-
`(A) IN GENERAL- Except as provided in subparagraph (B), the term `qualified zone stock' means any stock in a domestic corporation if--
`(i) such stock is acquired by the taxpayer on original issue from the corporation solely in exchange for cash,
`(ii) as of the time such stock was issued, such corporation was an enterprise zone business (or, in the case of a new corporation, such corporation was being organized for purposes of being an enterprise zone business), and
`(iii) during substantially all of the taxpayer's holding period for such stock, such corporation qualified as an enterprise zone business.
`(B) REDEMPTIONS- The term `qualified zone stock' shall not include any stock acquired from a corporation which made a substantial stock redemption or distribution (without a bona fide business purpose therefor) in an attempt to avoid the purposes of this section.
`(3) QUALIFIED ZONE PROPERTY-
`(A) IN GENERAL- The term `qualified zone property' has the meaning given to such term by section 1397C, except that references to empowerment zones shall be treated as including references to enterprise communities.
`(4) QUALIFIED ZONE PARTNERSHIP INTEREST- The term `qualified zone partnership interest' means any interest in a partnership if--
`(A) such interest is acquired by the taxpayer from the partnership solely in exchange for cash,
`(B) as of the time such interest was acquired, such partnership was an enterprise zone business (or, in the case of a new partnership, such partnership was being organized for purposes of being an enterprise zone business), and
`(C) during substantially all of the taxpayer's holding period for such interest, such partnership qualified as an enterprise zone business.
A rule similar to the rule of paragraph (2)(B) shall apply for purposes of this paragraph.
`(5) TREATMENT OF SUBSEQUENT PURCHASERS- The term `qualified zone asset' includes any property which would be a qualified zone asset but for paragraph (2)(A)(i), section 1397(a)(1)(B), or paragraph (4)(A) in the hands of the taxpayer if such property was a qualified zone asset in the hands of any prior holder.
`(6) 10-YEAR SAFE HARBOR- If any property ceases to be a qualified zone asset by reason of paragraph (2)(A)(iii), section 1397(a)(1)(C), or paragraph (4)(C) after the 10-year period beginning on the date the taxpayer acquired such property, such property shall continue to be treated as meeting the requirements of such paragraph; except that the amount of gain to which subsection (a) applies on any sale or exchange of such property shall not exceed the amount which would be qualified capital gain had such property been sold on the date of such cessation.
`(7) TREATMENT OF ZONE OR COMMUNITY TERMINATIONS- The termination of any designation of an area as an empowerment zone or enterprise community shall be disregarded for purposes of determining whether any property is a qualified zone asset.
`(c) OTHER DEFINITIONS AND SPECIAL RULES- For purposes of this section--
`(1) ENTERPRISE ZONE BUSINESS- For purposes of this section, the term `enterprise zone business' has the meaning given to such term by section 1394(b)(3).'.
`(2) QUALIFIED CAPITAL GAIN- Except as otherwise provided in this subsection, the term `qualified capital gain' means any long-term capital gain.
`(3) CERTAIN GAIN ON REAL PROPERTY NOT QUALIFIED- The term `qualified capital gain' shall not include any gain which would be treated as ordinary income under section 1250 if section 1250 applied to all depreciation rather than the additional depreciation.
`(4) GAIN ATTRIBUTABLE TO PERIODS AFTER TERMINATION OF ZONE OR COMMUNITY DESIGNATION NOT QUALIFIED- The term `qualified capital gain' shall not include any gain attributable to periods after the termination of any designation of an area as an empowerment zone or enterprise community.
`(d) TREATMENT OF PASS-THRU ENTITIES-
`(1) SALES AND EXCHANGES- Gain on the sale or exchange of an interest in a pass-thru entity held by the taxpayer (other than an interest in an entity which was an enterprise zone business during substantially all of the period the taxpayer held such interest) for more than 5 years shall be treated as gain described in subsection (a) to the extent such gain is attributable to amounts which would be qualified capital gain on qualified zone assets (determined as if such assets had been sold on the date of the sale or exchange) held by such entity for more than 5 years and throughout the period the taxpayer held such interest. A rule similar to the rule of paragraph (2)(B) shall apply for purposes of the preceding sentence.
`(A) IN GENERAL- Any amount included in income by reason of holding an interest in a pass-thru entity (other than an entity which was an enterprise zone business during substantially all of the period the taxpayer held the interest to which such inclusion relates) shall be treated as gain described in subsection (a) if such amount meets the requirements of subparagraph (B).
`(B) REQUIREMENTS- An amount meets the requirements of this subparagraph if--
`(i) such amount is attributable to gain on the sale or exchange by the pass-thru entity of property which is a qualified zone asset in the hands of such entity and which was held by such entity for the period required under subsection (a), and
`(ii) such amount is includible in the gross income of the taxpayer by reason of the holding of an interest in such entity which was held by the taxpayer on the date on which such pass-thru entity acquired such asset and at all times thereafter before the disposition of such asset by such pass-thru entity.
`(C) LIMITATION BASED ON INTEREST ORIGINALLY HELD BY TAXPAYER- Subparagraph (A) shall not apply to any amount to the extent such amount exceeds the amount to which subparagraph (A) would have applied if such amount were determined by reference to the interest the taxpayer held in the pass-thru entity on the date the qualified zone asset was acquired.
`(3) PASS-THRU ENTITY- For purposes of this subsection, the term `pass-thru entity' means--
`(C) any regulated investment company, and
`(D) any common trust fund.
`(e) SALES AND EXCHANGES OF INTERESTS IN PARTNERSHIPS AND S CORPORATIONS WHICH ARE QUALIFIED ZONE BUSINESSES- In the case of the sale or exchange of an interest in a partnership, or of stock in an S Corporation, which was an enterprise zone business during substantially all of the period the taxpayer held such interest or stock) is an enterprise zone business, the amount of qualified capital gain shall be determined without regard to--
`(1) any intangible, and any land, which is not an integral part of any qualified business (as defined in section 1397B(d)), and
`(2) gain attributable to periods before the designation of an area as an empowerment zone or enterprise community.
`(f) CERTAIN TAX-FREE AND OTHER TRANSFERS- For purposes of this section--
`(1) IN GENERAL- In the case of a transfer of a qualified zone asset to which this subsection applies, the transferee shall be treated as--
`(A) having acquired such asset in the same manner as the transferor, and
`(B) having held such asset during any continuous period immediately preceding the transfer during which it was held (or treated as held under this subsection) by the transferor.
`(2) TRANSFERS TO WHICH SUBSECTION APPLIES- This subsection shall apply to any transfer--
`(C) from a partnership to a partner thereof of a qualified zone asset with respect to which the requirements of subsection (d)(2) are met at the time of the transfer (without regard to the 5-year holding requirement).
`(3) CERTAIN RULES MADE APPLICABLE- Rules similar to the rules of section 1244(d)(2) shall apply for purposes of this section.'.
(b) CONFORMING AMENDMENTS-
(1) Section 172(d)(2)(B) of the Internal Revenue Code of 1986 (relating to modifications with respect to net operating loss deduction) is amended by striking `section 1202' and inserting `sections 1202 and 1395B'.
(2) Paragraph (4) of section 642(c) of such Code (relating to adjustments) is amended by inserting `or 1395B(a)' after `section 1202(a)' and by inserting `or 1395B' after `section 1202'.
(3) Paragraph (3) of section 643(a) of such Code (defining distributable net income) is amended by striking `section 1202' and inserting `sections 1202 and 1395B'.
(4) Paragraph (4) of section 691(c) of such Code (relating to coordination with capital gain provisions) is amended by striking `1202, and 1211' and inserting `1202, 1395B, and 1211'.
(5) The second sentence of paragraph (2) of section 871(a) of such Code (relating to capital gains of aliens present in the United States 183 days or more) is amended by inserting `or 1395B' after `section 1202'.
(6) The table of sections of part II of subchapter U of chapter 1 of such Code, as amended by sections 101 and 102, is amended by adding at the end the following new item:
`Sec. 1395B. Exclusion for gain from zone or community investments.'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1996.
SEC. 104. INCREASE IN EXPENSING UNDER SECTION 179 FOR BUSINESSES IN ZONES AND COMMUNITIES.
(a) IN GENERAL- Part II of subchapter U of chapter 1 of the Internal Revenue Code of 1986, as amended by sections 101, 102, and 103, is amended by adding at the end the following new section:
`SEC. 1395C. INCREASE IN EXPENSING UNDER SECTION 179.
`(a) GENERAL RULE- In the case of an enterprise zone business, for purposes of section 179--
`(1) the limitation under section 179(b)(1) shall be increased by the lesser of--
`(B) the cost of section 179 property which is qualified zone property placed in service during the taxable year, and
`(2) the amount taken into account under section 179(b)(2) with respect to any section 179 property which is qualified zone property shall be 50 percent of the cost thereof.
`(b) RECAPTURE- Rules similar to the rules under section 179(d)(10) shall apply with respect to any qualified zone property which ceases to be used in an empowerment zone or enterprise community by an enterprise zone business.
`(c) ENTERPRISE ZONE BUSINESS- For purposes of this section, the term `enterprise zone business' has the meaning given to such term by section 1394(b)(3).'.
(b) CONFORMING AMENDMENTS-
(1) The table of sections of part II of subchapter U of chapter 1 of the Internal Revenue Code of 1986, as amended by sections 101, 102, and 103, is amended by adding at the end the following new item:
`Sec. 1395C. Increase in expensing under section 179.'.
(2) Part III of subchapter U of chapter 1 of such Code is amended by striking subpart B and by redesignating subpart C as subpart B.
(3) The table of subparts of part III of such subchapter is amended by striking the item relating to subpart B and by redesignating the item relating to subpart C as subpart B.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1996.
SEC. 105. TAX-FREE DIVIDENDS RECEIVED FROM ENTERPRISE ZONE BUSINESSES.
(a) CORPORATIONS- Section 243(a) of the Internal Revenue Code of 1986 (relating to dividends received by corporations) is amended--
(1) by striking `and' at the end of paragraph (2),
(2) by striking the period at the end of paragraph (3) and inserting `; and', and
(3) by adding at the end the following new paragraph:
`(4) 100 percent in the case of dividends received from an enterprise zone business.'.
(b) TAXPAYERS OTHER THAN CORPORATIONS-
(1) IN GENERAL- Part III of subchapter B of chapter 1 of the Internal Revenue Code of 1986 (relating to items specifically excluded for gross income) is amended by redesignating section 137 as section 138 and by inserting after section 136 the following new section:
`SEC. 137. EXCLUSION OF CERTAIN DIVIDENDS RECEIVED BY INDIVIDUALS.
`(a) EXCLUSION FROM GROSS INCOME- Gross income does not include amounts received by an individual as dividends from enterprise zone businesses.
`(b) CERTAIN DIVIDENDS EXCLUDED- Subsection (a) shall not apply to any dividend from--
`(1) a corporation which, for the taxable year of the corporation in which the distribution is made, or for the next preceding taxable year of the corporation, is a corporation exempt from tax under section 501 (relating to certain charitable, etc., organizations) or section 521 (relating to farmers' cooperative associations); or
`(2) a real estate investment trust which, for the taxable year of the trust in which the dividend is paid, qualifies under part II of subchapter M (sec. 856 and following).
`(c) SPECIAL RULES FOR CERTAIN DISTRIBUTIONS- For purposes of subsection (a)--
`(1) Any amount allowed as a deduction under section 591 (relating to deduction for dividends paid by mutual savings banks, etc.) shall not be treated as a dividend.
`(2) A dividend received from a regulated investment company shall be subject to the limitations prescribed in section 854.
`(3) The amount of dividends properly allocable to a beneficiary under section 652 or 662 shall be deemed to have been received by the beneficiary ratably on the same date that the dividends were received by the estate or trust.'.
(2) CONFORMING AMENDMENT- The table of sections for such part III is amended by striking the item relating to section 137 and inserting the following new items:
`Sec. 137. Exclusion of certain dividends received by individuals.
`Sec. 138. Cross reference to other Acts.'.
(c) EFFECTIVE DATE- The amendments made by this section shall apply to taxable years beginning after December 31, 1996.
SEC. 106. WORK OPPORTUNITY TAX CREDIT.
(a) AMOUNT OF CREDIT- Subsection (a) of section 51 of the Internal Revenue Code of 1986 (relating to amount of credit) is amended by striking `40 percent' and inserting `35 percent'.
(b) QUALIFIED WAGES- Paragraph (3) of section 51(b) of the Internal Revenue Code of 1986 (defining qualified wages) is amended by striking `$6,000' both places it appears and inserting `$12,000'.
(c) MEMBERS OF TARGETED GROUPS- Subsection (d) of section 51 of the Internal Revenue Code of 1986 is amended to read as follows:
`(d) MEMBERS OF TARGETED GROUPS- For purposes of this subpart--
`(1) IN GENERAL- An individual is a member of a targeted group if such individual is--
`(A) a qualified IV-A recipient,
`(B) a qualified veteran,
`(D) a vocational rehabilitation referral, or
`(E) a qualified summer youth employee.
`(2) QUALIFIED IV-A RECIPIENT-
`(A) IN GENERAL- The term `qualified IV-A recipient' means any individual who is certified by the designated local agency as being a member of a family receiving assistance under a IV-A program for at least a 9-month period
ending during the 9-month period ending on the hiring date.
`(B) IV-A PROGRAM- For purposes of this paragraph, the term `IV-A program' means any program providing assistance under a State plan approved under part A of title IV of the Social Security Act (relating to assistance for needy families with minor children) and any successor of such program.
`(A) IN GENERAL- The term `qualified veteran' means any veteran who is certified by the designated local agency as being--
`(i) a member of a family receiving assistance under a IV-A program (as defined in paragraph (2)(B)) for at least a 9-month period ending during the 12-month period ending on the hiring date, or
`(ii) a member of a family receiving assistance under a food stamp program under the Food Stamp Act of 1977 for at least a 3-month period ending during the 12-month period ending on the hiring date.
`(B) VETERAN- For purposes of subparagraph (A), the term `veteran' means any individual who is certified by the designated local agency as--
`(i)(I) having served on active duty (other than active duty for training) in the Armed Forces of the United States for a period of more than 180 days, or
`(II) having been discharged or released from active duty in the Armed Forces of the United States for a service-connected disability, and
`(ii) not having any day during the 60-day period ending on the hiring date which was a day of extended active duty in the Armed Forces of the United States.
For purposes of clause (ii), the term `extended active duty' means a period of more than 90 days during which the individual was on active duty (other than active duty for training).
`(A) IN GENERAL- The term `high-risk youth' means any individual who is certified by the designated local agency--
`(i) as having attained age 18 but not age 25 on the hiring date, and
`(ii) as having his principal place of abode within an empowerment zone or enterprise community.
`(B) YOUTH MUST CONTINUE TO RESIDE IN ZONE- In the case of a high-risk youth, the term `qualified wages' shall not include wages paid or incurred for services performed while such youth's principal place of abode is outside an empowerment zone or enterprise community.
`(5) VOCATIONAL REHABILITATION REFERRAL- The term `vocational rehabilitation referral' means any individual who is certified by the designated local agency as--
`(A) having a physical or mental disability which, for such individual, constitutes or results in a substantial handicap to employment, and
`(B) having been referred to the employer upon completion of (or while receiving) rehabilitative services pursuant to--
`(i) an individualized written rehabilitation plan under a State plan for vocational rehabilitation services approved under the Rehabilitation Act of 1973, or
`(ii) a program of vocational rehabilitation carried out under chapter 31 of title 38, United States Code.
`(6) QUALIFIED SUMMER YOUTH EMPLOYEE-
`(A) IN GENERAL- The term `qualified summer youth employee' means any individual--
`(i) who performs services for the employer between May 1 and September 15,
`(ii) who is certified by the designated local agency as having attained age 16 but not 18 on the hiring date (or if later, on May 1 of the calendar year involved),
`(iii) who has not been an employee of the employer during any period prior to the 90-day period described in subparagraph (B)(i), and
`(iv) who is certified by the designated local agency as having his principal place of abode within an empowerment zone or enterprise community.
`(B) SPECIAL RULES FOR DETERMINING AMOUNT OF CREDIT- For purposes of applying this subpart to wages paid or incurred to any qualified summer youth employee--
`(i) subsection (b)(2) shall be applied by substituting `any 90-day period between May 1 and September 15' for `the 1-year period beginning with the day the individual begins work for the employer', and
`(ii) subsection (b)(3) shall be applied by substituting `$3,000' for `$6,000'.
The preceding sentence shall not apply to an individual who, with respect to the same employer, is certified as a member of another targeted group after such individual has been a qualified summer youth employee.
`(C) YOUTH MUST CONTINUE TO RESIDE IN ZONE- Paragraph (4)(B) shall apply for purposes of this paragraph.
`(7) HIRING DATE- The term `hiring date' means the day the individual is hired by the employer.
`(8) DESIGNATED LOCAL AGENCY- The term `designated local agency' means a State employment security agency established in accordance with the Act of June 6, 1933, as amended (29 U.S.C. 49-49n).
`(9) SPECIAL RULES FOR CERTIFICATIONS-
`(A) IN GENERAL- An individual shall not be treated as a member of a targeted group unless--
`(i) on or before the day on which such individual begins work for the employer, the employer has received a certification from a designated local agency that such individual is a member of a targeted group, or
`(ii)(I) on or before the day the individual is offered employment with the employer, a pre-screening notice is completed by the employer with respect to such individual, and
`(II) not later than the 14th day after the individual begins work for the employer, the employer submits such notice, signed by the employer and the individual under penalties of perjury, to the designated local agency as part of a written request for such a certification from such agency.
For purposes of this paragraph, the term `pre-screening notice' means a document (in such form as the Secretary shall prescribe) which contains information provided by the individual on the basis of which the employer believes that the individual is a member of a targeted group.
`(B) INCORRECT CERTIFICATIONS- If--
`(i) an individual has been certified by a designated local agency as a member of a targeted group, and
`(ii) such certification is incorrect because it was based on false information provided by such individual,
the certification shall be revoked and wages paid by the employer after the date on which notice of revocation is received by the employer shall not be treated as qualified wages.
`(C) EXPLANATION OF DENIAL OF REQUEST- If a designated local agency denies a request for certification of membership in a targeted group, such agency shall provide to the person making such request a written explanation of the reasons for such denial.'.
(d) MINIMUM EMPLOYMENT PERIOD- Paragraph (3) of section 51(i) of the Internal Revenue Code of 1986 (relating to certain individuals ineligible) is amended to read as follows:
`(3) INDIVIDUALS NOT MEETING MINIMUM EMPLOYMENT PERIOD- No wages shall be taken into account under subsection (a) with respect to any individual unless such individual either--
`(A) is employed by the employer at least 180 days (20 days in the case of a qualified summer youth employee), or
`(B) has completed at least 500 hours (120 hours in the case of a qualified summer youth employee) of services performed for the employer.'.
(e) TERMINATION- Paragraph (4) of section 51(c) of the Internal Revenue Code of 1986 (relating to wages defined) is amended to read as follows:
`(4) TERMINATION- The term `wages' shall not include any amount paid or incurred to an individual who begins work for the employer--
`(A) after December 31, 1994, and before January 1, 1996, or
`(B) after December 31, 1996.'.
(f) REDESIGNATION OF CREDIT-
(1) Sections 38(b)(2) and 51(a) of the Internal Revenue Code of 1986 are each amended by striking `targeted jobs credit' and inserting `work opportunity credit'.
(2) The subpart heading for subpart F of part IV of subchapter A of chapter 1 of such Code is amended by striking `Targeted Jobs Credit' and inserting `Work Opportunity Credit'.
(3) The table of subparts for such part IV is amended by striking `targeted jobs credit' and inserting `work opportunity credit'.
(4) The heading for paragraph (3) of section 1396(c) of such Code is amended by striking `TARGETED JOBS CREDIT' and inserting `WORK OPPORTUNITY CREDIT'.
(f) TECHNICAL AMENDMENTS-
(1) Paragraph (1) of section 51(c) of the Internal Revenue Code of 1986 is amended by striking `, subsection (d)(8)(D),'.
(2) Paragraph (3) of section 51(i) of such Code is amended by striking `(d)(12)' each place it appears and inserting `(d)(6)'.
(g) EFFECTIVE DATE- The amendments made by this section shall apply to individuals who begin work for the employer after December 31, 1996.
Subtitle B--Contracting Set-Aside Reform
SEC. 111. AMENDMENTS TO THE SMALL BUSINESS ACT.
(a) FINDINGS AND PURPOSES- Section 2 of the Small Business Act (15 U.S.C. 631) is amended--
(1) by striking subsection (f);
(2) by redesignating subsections (g) through (i) as subsections (f) through (h), respectively; and
(3) in subsection (g)(1)(H), as redesignated, by striking `socially and'.
(b) DEFINITIONS- Section 3 of the Small Business Act (15 U.S.C. 632) is amended by adding at the end the following new subsection:
`(o) ECONOMICALLY DISADVANTAGED- For purposes of this Act, the terms `economically disadvantaged small business concern' and `economically disadvantaged individual' have the same meanings as in section 8(a).'.
(c) ADMINISTRATION OF PROGRAMS- Section 4(b)(1) of the Small Business Act (15 U.S.C. 633(b)(1)) is amended by striking the sixth sentence.
(d) GUARANTEED LOAN PROGRAM- Section 7(a)(20)(A) of the Small Business Act (15 U.S.C. 636(a)(20)(A)) is amended by striking `subsection (j)(10) and'.
(e) FINANCIAL ASSISTANCE FOR PROJECTS PROVIDING TECHNICAL OR MANAGEMENT ASSISTANCE- Section 7(j) of the Small Business Act (15 U.S.C. 636(j)) is amended--
(1) in paragraph (1), by striking `sections 7(i), 7(j)(10), and' and inserting `subsection (i) of this section and section';
(2) in paragraph (2)(C), by striking `sections 7(i), 7(j)(10), and' and inserting `subsection (i) of this section and section';
(3) by striking paragraph (4) and inserting the following:
`(4) PREFERENCE- In carrying out this subsection, the Administrator shall give preference to projects that promote the training and hiring by small business concerns of economically disadvantaged individuals.';
(4) by striking paragraph (10);
(5) by redesignating paragraph (11) as paragraph (8) and inserting it immediately after paragraph (7);
(6) in paragraph (8), as redesignated--
(A) in subparagraph (A)--
(i) by striking `(A)'; and
(ii) by striking `and small business concerns' and all that follows before the period; and
(B) by striking subparagraphs (B) through (I); and
(7) by striking paragraphs (12) through (16).
(f) PROCUREMENT CONTRACTS- Section 8(a) of the Small Business Act (15 U.S.C. 637(a)) is amended--
(A) in subparagraph (B), by striking `socially and';
(B) in subparagraph (C)--
(i) by moving the margins 2 ems to the left; and
(ii) by striking `a small business concern owned and controlled by socially and economically disadvantaged individuals' and inserting `an economically disadvantaged small business concern'; and
(C) in subparagraph (D)(ii), by striking `Associate Administrator for Minority Small Business and Capital Ownership Development' and inserting `Administrator';
(2) by striking paragraphs (4) through (6) and inserting the following:
`(4) APPLICATIONS; REQUIRED CERTIFICATIONS- Each small business concern seeking assistance under this subsection shall, for each contract with respect to which such assistance is sought, submit an application to the Administrator, which shall include--
`(A) a written certification that--
`(i) the small business concern meets the requirements of paragraphs (5) and (6), and expects to continue to meet those requirements during the term of the contract at issue;
`(ii) not less than 30 percent of the contract at issue will be performed by economically disadvantaged individuals employed by the small business concern; and
`(iii) during the term of the contract at issue, the small business concern will not terminate the employment of any economically disadvantaged individual employed by the small business concern or any individual employed by the small business concern who resides in any area described in paragraph (5)(B)(i), except for just cause; and
`(B) such documentation as the Administrator may require, in order to verify the status of the small business concern as an economically disadvantaged small business concern, including--
`(i) relevant tax forms and information;
`(ii) a copy of the birth certificates of dependent children of economically disadvantaged individuals employed by the small business concern; and
`(iii) sworn affidavits from economically disadvantaged individuals employed by the small business concern necessary to verify the status of those individuals as economically disadvantaged individuals.
`(5) ECONOMICALLY DISADVANTAGED SMALL BUSINESS CONCERN- For purposes of this subsection, the term `economically disadvantaged small business concern' means--
`(A) a small business concern, if not less than 35 percent of the employees of the small business concern, who are employed by the small business concern as of the date on which the application is submitted under paragraph (4), and who were hired by the small business concern during the 5-year period preceding the date on which the small business concern submits an application for assistance under this subsection, were economically disadvantaged individuals, as of the date on which those employees were hired by the small business concern; or
`(B) a small business concern, the operations and facilities of which are predominately located in an area nominated before the date of enactment of the Community Renewal and Economic Opportunity Act for designation--
`(i) under section 1391 of the Internal Revenue Code of 1986 as an empowerment zone or enterprise community (whether or not so designated); or
`(ii) under section 701 of the Housing and Community Development Act of 1987 as an enterprise zone (whether or not so designated).
`(6) ECONOMICALLY DISADVANTAGED INDIVIDUAL-
`(A) DEFINITION- For purposes of this subsection, the term `economically disadvantaged individual' means an individual who is a United States citizen, having a net financial worth of not more than $2,000--
`(i) who, as of the date on which the individual was hired by the small business concern--
`(I) was not claimed as a dependent on any Federal or State income tax return filed for the 4 taxable years preceding that date; and
`(II) earned a net monthly income that did not exceed 100 percent of the poverty line (as that term is defined in section 673 of the Community Service Block Grant Act (42 U.S.C. 9902)), both during the 1-year period preceding that date, and during not less than 3 of the 4 taxable years immediately preceding that date; or
`(ii) who, as of the date on which the individual was hired by the small business concern--
`(I) was not claimed as a dependent on any Federal or State income tax return filed for the taxable year preceding that date;
`(II) earned a net monthly income that did not exceed 100 percent of the poverty line (as that term is defined in section 673 of the Community Service Block Grant Act (42 U.S.C. 9902)) during the 1-year period preceding that date; and
`(III) had one or more dependents who were 18 years of age or younger.
`(B) CALCULATION OF NET FINANCIAL WORTH- In calculating the net financial worth of an individual for purposes of subparagraph (A), the administrator shall--
`(i) include the fair market value of any checking or savings accounts, cash, stocks, bonds, and any other personal property of the individual;
`(ii) exclude any equity of the individual in the primary personal residence of the individual or in the furnishings of that residence; and
`(iii) establish procedures for calculating the value of any motor vehicle owned by the individual.';
(3) by striking paragraph (8) and inserting the following:
`(7) PREFERENCES- In awarding contracts under this subsection, the administrator shall establish a system that gives preference to economically disadvantaged small business concerns--
`(A) more than 35 percent of the employees of which are economically disadvantaged individuals; or
`(B) not less than 35 percent of the ownership of which is vested in one or more individuals who reside in any area described in paragraph (5)(B)(i).';
(4) in paragraph (10), in the second sentence, by striking `for certification';
(A) by striking subparagraphs (A) and (B) and redesignating subparagraphs (C) through (F) as subparagraphs (A) through (D);
(B) in subparagraph (B), as redesignated, by striking `subparagraph (C)' and inserting `subparagraph (A)'; and
(C) in subparagraph (C), as redesignated, by striking `subparagraph (D)' and inserting `subparagraph (B)';
(6) in paragraph (16)(A)--
(A) by striking `Program Participant' each place that term appears and inserting `small business concern';
(B) in clause (i), by adding `and' at the end;
(C) in clause (ii), by striking `; and' and inserting a period; and
(D) by striking clause (iii);
(A) in subparagraph (A)--
(i) by striking `Program Participant' the second place that term appears and inserting `small business concern';
(ii) by striking `Program Participant' the first place that term appears and inserting `small business concern receiving assistance under this subsection';
(iii) by striking `Program Participants' and inserting `small business concerns'; and
(iv) by striking `, section 7(j)(10),'; and
(B) in subparagraph (C)(ii)--
(i) by striking subclause (III), and redesignating subclauses (IV) and (V) as subclauses (III) and (IV), respectively; and
(ii) in subclause (III), as redesignated, by striking `or section 7(j)(10)';
(A) by striking `(A) Subject to the provisions of subparagraph (B), a' and inserting `Each'; and
(B) by striking `Notwithstanding the provisions' and all that follows through the end of the paragraph;
(9) by striking paragraph (9) and redesignating paragraphs (10) through (12) as paragraphs (9) through (11), respectively;
(10) by striking paragraph (13) and redesignating paragraph (14) as paragraph (12);
(11) by striking paragraph (15) and redesignating paragraphs (16) through (19) as paragraphs (13) through (16), respectively;
(12) by striking paragraph (20) and redesignating paragraph (21) as paragraph (17); and
(13) by adding at the end the following new paragraph:
`(18) ANNUAL REPORT- The Administrator shall annually submit a report to the Congress, which shall include the following with respect to the fiscal year immediately preceding submission of the report:
`(A) COSTS AND BENEFITS- A description and estimate of the benefits and costs that have accrued to the economy and the Federal Government during that fiscal year due to the operations of those small business concerns that were performing contracts
awarded pursuant to this subsection during that fiscal year.
`(B) LIST OF PARTICIPANTS- A list of all small business concerns receiving assistance under this subsection during that fiscal year identifying, by State and by Region, the dollar amount of advance payments received by each small business concern pursuant to contracts awarded under this subsection, and a description including (if appropriate) an estimate of the dollar value of all benefits received by each small business concern pursuant to section 7(a)(20) during that fiscal year.
`(C) TOTAL VALUE OF CONTRACTS AND OPTIONS AWARDED- The total dollar value of contracts and options awarded under this subsection during that fiscal year, and such amount expressed as a percentage of total sales of all small business concerns receiving assistance under this subsection during that fiscal year.
`(D) VALUE OF CONTRACTS AND OPTIONS AWARDED BY STANDARD INDUSTRIAL CLASSIFICATION CODE- The total dollar value of contracts and options awarded under this subsection during that fiscal year, at such dollar increments as the Administrator deems appropriate, for each 4-digit standard industrial classification code under which such contracts and options were classified.
`(E) ADDITIONAL RESOURCES- A description of such additional resources as may be required to provide the types of services needed over the succeeding 2-year period to service the projected portfolio of small business concerns receiving assistance under this subsection.'.
(g) PERFORMANCE OF CONTRACTS- Section 8(d) of the Small Business Act (15 U.S.C. 637(d)) is amended--
(A) in the first sentence, by striking `,, small business concerns owned and controlled by socially and economically disadvantaged individuals, and small business concerns owned and controlled by women,' and inserting `and economically disadvantaged small business concerns'; and
(B) in the second sentence, by striking `, small business concerns owned and controlled by socially and economically disadvantaged individuals, and small business concerns owned and controlled by women' and inserting `and economically disadvantaged small business concerns';
(A) in subparagraph (A), by striking `, small business concerns owned and controlled by socially and economically disadvantaged individuals, and small business concerns owned and controlled by women' each place that term appears and inserting `and economically disadvantaged small business concerns';
(B) by striking subparagraphs (C) and (D) and inserting the following:
`(C) For purposes of this contract, the terms `small business concern' and `economically disadvantaged small business concern' have the same meanings as in section 3 of the Small Business Act.';
(C) by redesignating subparagraph (E) as subparagraph (D); and
(D) in subparagraph (D), as redesignated, by striking `, a small business concern owned and controlled by socially and economically disadvantaged individuals, or a small business concern owned and controlled by women' and inserting `or an economically disadvantaged small business concern';
(A) in subparagraph (D), by striking `, small business concerns owned and controlled by socially and economically disadvantaged individuals, and small business concerns owned and controlled by women' and inserting `and economically disadvantaged small business concerns'; and
(B) in subparagraph (E), by striking `small business concerns owned and controlled by socially and economically disadvantaged individuals' and all that follows through `women' and inserting `economically disadvantaged small business concerns';
(4) in paragraph (6), by striking subparagraph (A) and inserting the following:
`(A) percentage goals for the utilization as subcontractors of small business concerns and economically disadvantaged small business concerns;'; and
(5) in paragraph (10)(B), by striking `, small business concerns owned and controlled by socially and economically disadvantaged individuals, and small business concerns owned and controlled by women' and inserting `and economically disadvantaged small business concerns'.
(h) POLICY DIRECTIVES- Section 9(j)(2)(F) of the Small Business Act (15 U.S.C. 638(j)(2)(F)) is amended--
(1) by striking `socially and'; and
(2) by striking `, as defined in section 8(a)(4),'.
(i) AWARDS OR CONTRACTS- Section 15 of the Small Business Act (15 U.S.C. 644) is amended--
(1) in subsection (g)(1)--
(A) by striking `, small business concerns owned and controlled by socially and economically disadvantaged individuals, and small business concerns owned and controlled by women' each place that term appears and inserting `and economically disadvantaged small business concerns';
(B) in the third sentence, by striking `small business concerns owned and controlled by socially and economically disadvantaged individuals' and inserting `economically disadvantaged small business concerns'; and
(C) by striking the fourth sentence;
(2) in subsection (g)(2)--
(A) in the first sentence, by striking `,, by small business concerns owned and controlled by socially and economically disadvantaged individuals, and by small business concerns owned and controlled by women' and inserting `and by economically disadvantaged small business concerns';
(B) in the second sentence, by striking `, small business concerns owned and controlled by socially and economically disadvantaged individuals, and small business concerns owned and controlled by women' and inserting `and economically disadvantaged small business concerns'; and
(C) in the fourth sentence, by striking `small business concerns owned and controlled by socially and economically disadvantaged individuals and participation by small business concerns owned and controlled by women' and inserting `economically disadvantaged small business concerns'; and
(A) by striking `, small business concerns owned and controlled by socially and economically disadvantaged individuals, and small business concerns owned and controlled by women' each place that term appears and inserting `and economically disadvantaged small business concerns'; and
(i) in subparagraph (D)(ii), by striking `small business concerns owned and controlled by socially and economically disadvantaged individuals' and inserting `economically disadvantaged small business concerns'; and
(ii) by striking subparagraph (F).
(j) OFFENSES AND PENALTIES- Section 16 of the Small Business Act (15 U.S.C. 645) is amended--
(1) in subsection (d)(1)--
(A) by striking `, a `small business concern owned and controlled by socially and economically disadvantaged individuals' and all that follows through `women' and inserting `or an `economically disadvantaged small business concern'; and
(B) in subparagraph (D), by striking `section 8(d)' and inserting `subsection (a) or (d) of section 8(a) of this Act';
(2) in subsection (e), by striking `, a `small business concern owned and controlled by socially and economically disadvantaged individuals' and all that follows through `women' and inserting `or an `economically disadvantaged small business concern'; and
(3) by striking subsection (f).
SEC. 112. TECHNICAL AND CONFORMING AMENDMENTS IN OTHER LAW.
(a) TITLE 10, UNITED STATES CODE- Section 2323 of title 10, United States Code, is amended--
(1) in subsection (a)(1), by striking subparagraph (A) and inserting the following:
`(A) economically disadvantaged small business concerns, including mass media and advertising firms;';
(2) in subsection (f), by striking `a small business concern owned and controlled by a minority' and inserting `an economically disadvantaged small business concern';
(3) in subsection (i)(3)--
(A) in subparagraph (B), by striking `not owned and controlled by socially and economically disadvantaged individuals' and inserting `that are not economically disadvantaged small business concerns'; and
(B) by striking subparagraph (C); and
(4) in subsection (j), by adding at the end the following new paragraph:
`(3) The term `economically disadvantaged small business concern' has the same meaning as in section 8(a) of the Small Business Act.'.
(b) FEDERAL HOME LOAN BANK ACT- Section 21A(b)(13) of the Federal Home Loan Bank Act (12 U.S.C. 1441a(b)(13)) is amended by striking `small business concerns owned and controlled by socially and economically disadvantaged individuals' and inserting `economically disadvantaged small business concerns (as that term is defined in section 8(a) of the Small Business Act)'.
(c) SMALL BUSINESS ECONOMIC POLICY ACT OF 1980- Section 303(e) of the Small Business Economic Policy Act of 1980 (15 U.S.C. 631b(e)) is amended by striking paragraph (1) and inserting the following:
`(1) economically disadvantaged small business concerns (as that term is defined in section 8(a) of the Small Business Act);'.
(d) SMALL BUSINESS INVESTMENT ACT OF 1958- Section 411(c)(3)(B) of the Small Business Investment Act of 1958 (15 U.S.C. 694b(c)(3)(B)) is amended by striking `a small business concern owned' and all that follows before the semicolon and inserting `an economically disadvantaged small business concern (as that term is defined in section 8(a) of the Small Business Act)'.
(e) TITLE 31, UNITED STATES CODE- Title 31, United States Code, is amended--
(A) in paragraph (1)(B), by striking `law firms owned and controlled by socially and economically disadvantaged individuals' and inserting `economically disadvantaged law firms'; and
(B) in paragraph (3), by striking `law firms owned and controlled by socially and economically disadvantaged individuals. For purposes of' and all that follows through the end of the paragraph, and inserting the following: `economically disadvantaged law firms. For purposes of this paragraph, the term `economically disadvantaged law firm' means a law firm, regardless of whether or not the law firm is a small business concern (as that term is defined in section 3 of the Small Business Act), that is otherwise described in either section 8(a)(5)(A) of the Small Business Act or clauses (i) and (ii) of section 8(a)(5)(B) of the Small Business Act.';
(A) in paragraph (1)(A), by striking `small business concerns controlled by socially and economically disadvantaged individuals and women' and inserting `economically disadvantaged small business concerns'; and
(B) by striking paragraph (3)(B) and inserting the following:
`(B) the term `economically disadvantaged small business concern' has the same meaning as in section 8(a) of the Small Business Act.'; and
(3) in section 7505(c), by striking `business concerns owned and controlled by socially and economically disadvantaged individuals' and inserting `economically disadvantaged small business concerns (as that term is defined in section 8(a) of the Small Business Act)'.
(f) OFFICE OF FEDERAL PROCUREMENT POLICY ACT-
(1) ENUMERATION OF INCLUDED FUNCTIONS- Section 6(d) of the Office of Federal Procurement Policy Act (41 U.S.C. 405(d)) is amended--
(A) in paragraph (5)(C), by striking `small business concerns owned' and all that follows through `minorities' and inserting `economically disadvantaged small business concerns (as that term is defined in section 8(a) of the Small Business Act)';
(B) in paragraph (10), by striking `small businesses,' and all that follows through `women' and inserting `small business concerns and economically disadvantaged small business concerns (as those terms are defined in section 3 of the Small Business Act)'; and
(C) in paragraph (11), by striking `small businesses,' and all that follows through `women' and inserting `small business concerns and economically disadvantaged small business concerns (as those terms are defined in section 3 of the Small Business Act)'.
(2) PROCUREMENT DATA- Section 19A of the Office of Federal Procurement Policy Act (41 U.S.C. 417a) is amended--
(A) in subsection (a), by striking `small businesses owned' and all that follows through `gender,' and inserting `economically disadvantaged small business concerns'; and
(B) by striking subsection (b) and inserting the following:
`(b) DEFINITION- For purposes of this section, the term `economically disadvantaged small business concern' has the same meaning as in section 8(a) of the Small Business Act.'.
(g) ENERGY POLICY ACT OF 1992- Section 3021 of the Energy Policy Act of 1992 (42 U.S.C. 13556) is amended--
(1) in subsection (a), by striking paragraph (1) and inserting the following:
`(1) economically disadvantaged small business concerns;'; and
(2) in subsection (b), by striking paragraph (2) and inserting the following:
`(2) The term `economically disadvantaged small business concern' has the same meaning as in section 8(a) of the Small Business Act.'.
(h) TITLE 49, UNITED STATES CODE- Title 49, United States Code, is amended--
(1) in section 47107(e)--
(A) in paragraph (1), by striking `small business concerns' and all that follows before the period and inserting `economically disadvantaged small business concerns (as that term is defined in section 8(a) of the Small Business Act)';
(B) in paragraph (4)(B), by striking `a small business concern owned and controlled by a socially and economically disadvantaged individual' and inserting `an economically disadvantaged small business concern (as that term is defined in section 8(a) of the Small Business Act)'; and
(C) in paragraph (6), by striking `a small business concern' and all that follows before the period and inserting `an economically disadvantaged small business concern (as that term is defined in section 8(a) of the Small Business Act)'; and
(A) by striking subsection (a) and inserting the following:
`(a) DEFINITIONS- For purposes of this section--
`(1) the term `economically disadvantaged small business concern' has the same meaning as in section 8(a) of the Small Business Act; and
`(2) the term `small business concern' has the same meaning as in section 3 of the Small Business Act, except that the term does not include a small business concern that has average annual gross receipts during the most recent 3 fiscal years of more than $16,015,000, as adjusted by the Secretary of Transportation for inflation.'; and
(B) in subsection (b), by striking `small business concerns owned and controlled by socially and economically disadvantaged individuals' and inserting `economically disadvantaged small business concerns'.
(i) DEFENSE PRODUCTION ACT OF 1950- Section 702 of the Defense Production Act of 1950 (50 U.S.C. 2152) is amended--
(1) in paragraph (16), by striking `such business concerns owned and controlled by socially and economically disadvantaged individuals or by women' and inserting `economically disadvantaged small business concerns'; and
(2) by striking paragraph (17) and inserting the following:
`(17) ECONOMICALLY DISADVANTAGED SMALL BUSINESS CONCERN- The term `economically disadvantaged small business concern' has the same meaning as in section 8(a) of the Small Business Act.'.
SEC. 113. SAVINGS PROVISION.
Nothing in this title or the amendments made by this title shall affect the terms or conditions of any contract entered into before the date of enactment of this Act.
SEC. 114. ADDITIONAL TECHNICAL AND CONFORMING AMENDMENTS.
Not later than 1 year after the date of enactment of this Act, the Administrator of the Small Business Administration shall submit to the Congress any recommended technical and conforming legislative changes necessary to carry out this title and the amendments made by this title.
Subtitle C--Small Business Mentor Program
SEC. 121. ESTABLISHMENT OF MENTOR PROGRAM.
(a) IN GENERAL- Not later than 90 days after the date of enactment of this Act, the Administrator shall establish and carry out a program, under which--
(1) the Administrator shall recruit qualified mentors to provide assistance to eligible small business concerns;
(2) to the maximum extent practicable, each eligible small business concern shall be assigned a qualified mentor from the same or similar industry as the eligible small business concern; and
(2) each qualified mentor assigned to an eligible small business concern under paragraph (2) shall--
(A) provide assistance to the eligible small business concern in the establishment and operation of that small business concern; and
(B) otherwise serve as a resource for information, consultation, and assistance for that eligible small business concern.
(b) DEFINITIONS- For purposes of this section--
(1) the term `Administrator' means the Administrator of the Small Business Administration;
(2) the term `eligible small business concern' means a small business concern that--
(A) is a sole proprietorship; and
(I) under section 1391 of the Internal Revenue Code of 1986 as an empowerment zone or enterprise community; or
(II) under section 701 of the Housing and Community Development Act of 1987 as an enterprise zone; or
(ii) any other area determined by the Administrator to be an area of high unemployment;
(3) the term `financial institution' means any bank or savings association (as those terms are defined in section 3 of the Federal Deposit Insurance Act);
(4) the term `qualified mentor' means a small business concern or financial institution that is determined by the Administrator to be qualified to provide assistance described in subsection (a) to eligible small business concerns in the same or similar industry as the small business concern or financial institution; and
(5) the term `small business concern' has the same meaning as in section 3 of the Small Business Act.
(c) LIST OF QUALIFIED MENTORS- In carrying out this section, the Administrator shall establish and maintain a list of available qualified mentors.
TITLE II--COMMUNITY INFRASTRUCTURE
SEC. 201. LIMITATION ON THE APPLICATION OF THE DAVIS-BACON REQUIREMENTS TO EMPOWERMENT ZONES, ENTERPRISE COMMUNITIES, AND ENTERPRISE ZONES.
The provisions of the Act of March 3, 1931 (commonly known as the Davis-Bacon Act) (40 U.S.C. 276a et seq.) shall not apply to a contract for construction, alteration, or repair of a facility in an area designated--
(1) under section 1391 of the Internal Revenue Code of 1986 as an empowerment zone or enterprise community; or
(2) under section 701 of the Housing and Community Development Act of 1987 (42 U.S.C. 11501) as an enterprise zone.
SEC. 202. REFORM OF COMMUNITY DEVELOPMENT BLOCK GRANT PROGRAM.
(a) INCREASED ASSISTANCE TO LOW- AND MODERATE-INCOME FAMILIES- Section 104(b)(3) of the Housing and Community Development Act of 1974 (42 U.S.C. 5304(b)(3)) is amended by striking `except that (A)' and all that follows through `(B) a grantee' and inserting the following: `except that--
`(A) of funds received under section 106 and, if applicable, as a result of a guarantee or a grant under section 108--
`(i) with respect to activities described in paragraph (14), (15), and (17) of section 105(a), during a period specified by the grantee of not more than 3 years, not less than 70 percent shall principally benefit persons of low and moderate income; and
`(ii) with respect to other activities assisted with amounts made available under this title, during a period specified by the grantee of not more than 12 months, not less than 75 percent shall principally benefit persons of low and moderate income; and
(b) REDUCTION IN ADMINISTRATION AND PLANNING COSTS- Section 104(b) of the Housing and Community Development Act of 1974 (42 U.S.C. 5304(b)) is amended--
(1) in paragraph (5), by striking `and' at the end;
(2) in paragraph (6), by striking the period at the end and inserting `; and'; and
(3) by adding at the end the following new paragraph:
`(7) not more than 12 percent of amounts received by the grantee under this title in any fiscal year will be used for administration and planning costs associated with any activity funded in whole or in part with assistance made available under this title.'.
(c) MATCHING FUND REQUIREMENT-
(1) IN GENERAL- Section 106(b) of the Housing and Community Development Act of 1974 (42 U.S.C. 5306(b)) is amended by adding at the end the following new paragraph:
`(7) MATCHING FUND REQUIREMENT- Notwithstanding any other provision of law, in each fiscal year, the Secretary shall--
`(A) require each metropolitan city or urban county that is among the wealthiest 10 percent (or such other percentage as the Secretary may establish) of metropolitan cities and urban counties receiving assistance under this title in that fiscal year, to make available contributions (from sources other than assistance made available under this title) in an amount equal to a specified percentage of the amount allocated under this subsection to that metropolitan city or urban county, which percentage shall be established by the Secretary;
`(B) reduce the amount allocated under this subsection to that metropolitan city or urban county by the amount of the contributions made available under subparagraph (A); and
`(C) increase the total amount otherwise available for allocation under this subsection to metropolitan cities and urban counties that are not described in subparagraph (A) by the aggregate amount of the reductions under subparagraph (B).'.
(2) APPLICABILITY- The amendment made by paragraph (1) shall be effective with respect to fiscal year 1997, and each fiscal year thereafter.
(d) INCREASED DAVIS-BACON THRESHOLD FOR CONSTRUCTION PROJECTS- Section 110 of the Housing and Community Development Act of 1974 (42 U.S.C. 5310) is amended by adding at the end the following new subsection:
`(c) MINIMUM THRESHOLD- Subsection (a) does not apply to any individual engaged construction work if the total cost of the activity assisted under this title to which the construction work relates does not exceed $250,000.'.
(e) PENALTY FOR DEFAULT ON ECONOMIC DEVELOPMENT LOAN- Section 111 of the Housing and Community Development Act of 1974 (42 U.S.C. 5311) is amended by adding at the end the following new subsection:
`(d) EXCESSIVE DEFAULTS ON ECONOMIC DEVELOPMENT LOANS- With respect to any recipient of assistance under this title that the Secretary determines to have an excessive rate of default on loans guaranteed under section 108 and assisted under section 108(q), the Secretary may reduce payments to the recipient under this title by an amount equal to the sum of the outstanding balance of that loan, including principal and interest.'.
TITLE III--SAFE STREETS
Subtitle A--Mandatory Restitution
SEC. 301. ORDER OF RESTITUTION.
Section 3556 of title 18, United States Code, is amended--
(1) by striking `may' and inserting `shall'; and
(2) by striking `sections 3663 and 3664.' and inserting `3663A, and may order restitution in accordance with section 3663. The procedures under section 3664 shall apply to all orders of restitution under this section.'.
SEC. 302. CONDITIONS OF PROBATION.
Section 3563 of title 18, United States Code, is amended--
(A) in paragraph (3), by striking `and' at the end;
(B) in the first paragraph (4) (relating to conditions of probation for a domestic crime of violence), by striking the period and inserting a semicolon;
(C) by redesignating the second paragraph (4) (relating to conditions of probation concerning drug use and testing) as paragraph (5);
(D) in paragraph (5), as redesignated, by striking the period at the end and inserting a semicolon; and
(E) by inserting after paragraph (5), as redesignated, the following new paragraphs:
`(6) that the defendant--
`(A) make restitution in accordance with sections 2248, 2259, 2264, 2327, 3663, 3663A, and 3664; and
`(B) pay the assessment imposed in accordance with section 3013; and
`(7) that the defendant will notify the court of any material change in the defendant's economic circumstances that might affect the defendant's ability to pay restitution, fines, or special assessments.'; and
(A) by striking paragraph (2);
(B) by redesignating paragraphs (3) through (22) as paragraphs (2) through (21), respectively; and
(C) by amending paragraph (2), as redesignated, to read as follows:
`(2) make restitution to a victim of the offense under section 3556 (but not subject to the limitation of section 3663(a) or 3663A(c)(1)(A));'.
SEC. 303. MANDATORY RESTITUTION.
(a) IN GENERAL- Chapter 232 of title 18, United States Code, is amended by inserting immediately after section 3663 the following new section:
`Sec. 3663A. Mandatory restitution to victims of certain crimes
`(a)(1) Notwithstanding any other provision of law, when sentencing a defendant convicted of an offense described in subsection (c), the court shall order, in addition to any other penalty authorized by law, that the defendant make restitution to the victim of the offense, or, if the victim is deceased, to the victim's estate.
`(2) For the purposes of this section, the term `victim' means a person directly and proximately harmed as a result of the commission of an offense for which restitution may be ordered including, in the case of an offense that involves as an element a scheme, conspiracy, or pattern of criminal activity, any person directly harmed by the defendant's criminal conduct in the course of the scheme, conspiracy, or pattern. In the case of a victim who is under 18 years of age, incompetent, incapacitated, or deceased, the legal guardian of the victim or representative of the victim's estate, another family member, or any other person appointed as suitable by the court, may assume the victim's rights under this section, but in no event shall the defendant be named as such representative or guardian.
`(3) The court shall also order, if agreed to by the parties in a plea agreement, restitution to persons other than the victim of the offense.
`(b) The order of restitution shall require that such defendant--
`(1) in the case of an offense resulting in damage to or loss or destruction of property of a victim of the offense--
`(A) return the property to the owner of the property or someone designated by the owner; or
`(B) if return of the property under subparagraph (A) is impossible, impracticable, or inadequate, pay an amount equal to--
`(I) the value of the property on the date of the damage, loss, or destruction; or
`(II) the value of the property on the date of sentencing, less
`(ii) the value (as of the date the property is returned) of any part of the property that is returned;
`(2) in the case of an offense resulting in bodily injury to a victim--
`(A) pay an amount equal to the cost of necessary medical and related professional services and devices relating to physical, psychiatric, and psychological care, including nonmedical care and treatment rendered in accordance with a method of healing recognized by the law of the place of treatment;
`(B) pay an amount equal to the cost of necessary physical and occupational therapy and rehabilitation; and
`(C) reimburse the victim for income lost by such victim as a result of such offense;
`(3) in the case of an offense resulting in bodily injury that results in the death of the victim, pay an amount equal to the cost of necessary funeral and related services; and
`(4) in any case, reimburse the victim for lost income and necessary child care, transportation, and other expenses incurred during participation in the investigation or prosecution of the offense or attendance at proceedings related to the offense.
`(c)(1) This section shall apply in all sentencing proceedings for convictions of, or plea agreements relating to charges for, any offense--
`(i) a crime of violence, as defined in section 16;
`(ii) an offense against property under this title, including any offense committed by fraud or deceit; or
`(iii) an offense described in section 1365 (relating to tampering with consumer products); and
`(B) in which an identifiable victim or victims has suffered a physical injury or pecuniary loss.
`(2) In the case of a plea agreement that does not result in a conviction for an offense described in paragraph (1), this section shall apply only if the plea specifically states that an offense listed under such paragraph gave rise to the plea agreement.
`(3) This section shall not apply if the court finds, from facts on the record, that--
`(A) the number of identifiable victims is so large as to make restitution impracticable; or
`(B) determining complex issues of fact related to the cause or amount of the victim's losses would complicate or prolong the sentencing process to a degree that the need to provide restitution to any victim is outweighed by the burden on the sentencing process.
`(d) An order of restitution under this section shall be issued and enforced in accordance with section 3664.'.
(b) CLERICAL AMENDMENT- The analysis for chapter 232 of title 18, United States Code, is amended by inserting immediately after the matter relating to section 3663 the following:
`3663A. Mandatory restitution to victims of certain crimes.'.
SEC. 304. ORDER OF RESTITUTION TO VICTIMS OF OTHER CRIMES.
(a) IN GENERAL- Section 3663 of title 18, United States Code, is amended--
(1) in subsection (a)(1)--
(A) by striking `(a)(1) The court' and inserting `(a)(1)(A) The court';
(B) by inserting `, section 401, 408(a), 409, 416, 420, or 422(a) of the Controlled Substances Act (21 U.S.C. 841, 848(a), 849, 856, 861, 863) (but in no case shall a participant in an offense under such sections be considered a victim of such offense under this section),' before `or section 46312,';
(C) by inserting `other than an offense described in section 3663A(c),' after `title 49,';
(D) by inserting before the period at the end the following: `, or if the victim is deceased, to the victim's estate';
(E) by adding at the end the following new subparagraph:
`(B)(i) The court, in determining whether to order restitution under this section, shall consider--
`(I) the amount of the loss sustained by each victim as a result of the offense; and
`(II) the financial resources of the defendant, the financial needs and earning ability of the defendant and the defendant's dependents, and such other factors as the court deems appropriate.
`(ii) To the extent that the court determines that the complication and prolongation of the sentencing process resulting from the fashioning of an order of restitution under this section outweighs the need to provide restitution to any victims, the court may decline to make such an order.'; and
(F) by amending paragraph (2) to read as follows:
`(2) For the purposes of this section, the term `victim' means a person directly and proximately harmed as a result of the commission of an offense for which restitution may be ordered including, in the case of an offense that involves as an element a scheme, conspiracy, or pattern of criminal activity, any person directly harmed by the defendant's criminal conduct in the course of the scheme, conspiracy, or pattern. In the case of a victim who is under 18 years of age, incompetent, incapacitated, or deceased, the legal guardian of the victim or representative of the victim's estate, another family member, or any other person appointed as suitable by the court, may assume the victim's rights under this section, but in no event shall the defendant be named as such representative or guardian.';
(2) by striking subsections (c) through (i); and
(3) by adding at the end the following new subsections:
`(c)(1) Notwithstanding any other provision of law (but subject to the provisions of subsections (a)(1)(B) (i)(II) and (ii), when sentencing a defendant convicted of an offense described in section 401, 408(a), 409, 416, 420, or 422(a) of the Controlled Substances Act (21 U.S.C. 841, 848(a), 849, 856, 861, 863), in which there is no identifiable victim, the court may order that the defendant make restitution in accordance with this subsection.
`(2)(A) An order of restitution under this subsection shall be based on the amount of public harm caused by the offense, as determined by the court in accordance with guidelines promulgated by the United States Sentencing Commission.
`(B) In no case shall the amount of restitution ordered under this subsection exceed the amount of the fine ordered for the offense charged in the case.
`(3) Restitution under this subsection shall be distributed as follows:
`(A) 65 percent of the total amount of restitution shall be paid to the Victim Assistance Administration of the State in which the crime occurred.
`(B) 35 percent of the total amount of restitution shall be paid to the State entity designated to receive Federal substance abuse block grant funds.
`(4) The court shall not make an award under this subsection if it appears likely that such award would interfere with a forfeiture under section 981 or 982.
`(5) Notwithstanding section 3612(c) or any other provision of law, a penalty assessment under section 3013 or a fine under subchapter C of chapter 227 shall take precedence over an order of restitution under this subsection.
`(6) Requests for community restitution under this subsection shall be considered in all plea agreements negotiated by the United States.
`(7)(A) The United States Sentencing Commission shall promulgate guidelines to assist courts in determining the amount of restitution that may be ordered under this subsection.
`(B) No restitution shall be ordered under this subsection until such time as the Sentencing Commission promulgates guidelines pursuant to this paragraph.
`(d) An order of restitution made pursuant to this section shall be issued and enforced in accordance with section 3664.'.
(b) SEXUAL ABUSE- Section 2248 of title 18, United States Code, is amended--
(1) in subsection (a), by inserting `or 3663A' after `3663';
(A) by amending paragraph (1) to read as follows:
`(1) DIRECTIONS- The order of restitution under this section shall direct the defendant to pay to the victim (through the appropriate court mechanism) the full amount of the victim's losses as determined by the court pursuant to paragraph (2).';
(B) by amending paragraph (2) to read as follows:
`(2) ENFORCEMENT- An order of restitution under this section shall be issued and enforced in accordance with section 3664 in the same manner as an order under section 3663A.';
(C) in paragraph (4), by striking subparagraphs (C) and (D); and
(D) by striking paragraphs (5) through (10);
(3) by striking subsections (c) through (e); and
(4) by redesignating subsection (f) as subsection (c).
(c) SEXUAL EXPLOITATION AND OTHER ABUSE OF CHILDREN- Section 2259 of title 18, United States Code, is amended--
(1) in subsection (a), by inserting `or 3663A' after `3663';
(A) by amending paragraph (1) to read as follows:
`(1) DIRECTIONS- The order of restitution under this section shall direct the defendant to pay the victim (through the appropriate court mechanism) the full amount of the victim's losses as determined by the court pursuant to paragraph (2).';
(B) by amending paragraph (2) to read as follows:
`(2) ENFORCEMENT- An order of restitution under this section shall be issued and enforced in accordance with section 3664 in the same manner as an order under section 3663A.';
(C) in paragraph (4), by striking subparagraphs (C) and (D); and
(D) by striking paragraphs (5) through (10);
(3) by striking subsections (c) through (e); and
(4) by redesignating subsection (f) as subsection (e).
(d) DOMESTIC VIOLENCE- Section 2264 of title 18, United States Code, is amended--
(1) in subsection (a), by inserting `or 3663A' after `3663';
(A) by amending paragraph (1) to read as follows:
`(1) DIRECTIONS- The order of restitution under this section shall direct the defendant to pay the victim (through the appropriate court mechanism) the full amount of the victim's losses as determined by the court pursuant to paragraph (2).';
(B) by amending paragraph (2) to read as follows:
`(2) ENFORCEMENT- An order of restitution under this section shall be issued and enforced in accordance with section 3664 in the same manner as an order under section 3663A.';
(C) in paragraph (4), by striking subparagraphs (C) and (D); and
(D) by striking paragraphs (5) through (10);
(3) by striking subsections (c) through (g); and
(4) by adding at the end the following new subsection (c):
`(c) VICTIM DEFINED- For purposes of this section, the term `victim' means the individual harmed as a result of a commission of a crime under this chapter, including, in the case of a victim who is under 18 years of age, incompetent, incapacitated, or deceased, the legal guardian of the victim or representative of the victim's estate, another family member, or any other person appointed as suitable by the court, but in no event shall the defendant be named as such representative or guardian.'.
(e) TELEMARKETING FRAUD- Section 2327 of title 18, United States Code, is amended--
(1) in subsection (a), by inserting `or 3663A' after `3663';
(A) by amending paragraph (1) to read as follows:
`(1) DIRECTIONS- The order of restitution under this section shall direct the defendant to pay to the victim (through the appropriate court mechanism) the full amount of the victim's losses as determined by the court pursuant to paragraph (2).';
(B) by amending paragraph (2) to read as follows:
`(2) ENFORCEMENT- An order of restitution under this section shall be issued and enforced in accordance with section 3664 in the same manner as an order under section 3663A.';
(C) in paragraph (4), by striking subparagraphs (C) and (D); and
(D) by striking paragraphs (5) through (10);
(3) by striking subsections (c) through (e); and
(4) by redesignating subsection (f) as subsection (c).
SEC. 305. PROCEDURE FOR ISSUANCE AND ENFORCEMENT OF RESTITUTION ORDER.
(a) IN GENERAL- Section 3664 of title 18, United States Code, is amended to read as follows:
`Sec. 3664. Procedure for issuance and enforcement of order of restitution
`(a) For orders of restitution under this title, the court shall order the probation service of the court to obtain and include in its presentence report, or in a separate report, as the court directs, information sufficient for the court to exercise its discretion in fashioning a restitution order. The report shall include, to the extent practicable, a complete accounting of the losses to each victim, any restitution owed pursuant to a plea agreement, and information relating to the economic circumstances of each defendant. If the number or identity of victims cannot be reasonably ascertained, or other circumstances exist that make this requirement clearly impracticable, the probation service shall so inform the court.
`(b) The court shall disclose to both the defendant and the attorney for the Government all portions of the presentence or other report pertaining to the matters described in subsection (a) of this section.
`(c) The provisions of this chapter, chapter 227, and Rule 32(c) of the Federal Rules of Criminal Procedure shall be the only rules applicable to proceedings under this section.
`(d)(1) Within 60 days after conviction and, in any event, not later than 10 days prior to sentencing--
`(A)(i) the attorney for the Government, after consulting with all identified victims, shall promptly provide the probation service of the court with a listing of the amounts subject to restitution;
`(ii) the attorney for the Government shall provide notice to all identified victims, informing the victims of the offenses of which the defendant was convicted, the listing of amounts subject to restitution submitted to the probation service, the victim's right to submit information to the probation service concerning the amount of the victim's losses, and the scheduled date, time, and place of the sentencing hearing; and
`(iii) if any victim objects to any of the information provided to the probation service relating to the amount of the victim's losses subject to restitution, the attorney for the Government shall advise the victim that the victim may file a separate affidavit and shall provide the victim with an affidavit form which may be used to do so; and
`(B) each defendant shall prepare and file with the probation service of the court an affidavit fully describing the financial resources of the defendant, including a complete listing of all assets owned or controlled by the defendant as of the date on which
the defendant was arrested, the financial needs and earning ability of the defendant and the defendant's dependents, and other information the court requires relating to such other factors as the court deems appropriate.
`(2) After reviewing the report of the probation service of the court, the court may require additional documentation or hear testimony. The privacy of any records filed, or testimony heard, pursuant to this section shall be maintained to the greatest extent possible, and such records may be filed or testimony heard in camera.
`(3) If the victim's losses are not ascertainable by the date that is 10 days prior to sentencing as provided in paragraph (1), the attorney for the Government shall so inform the court, and the court shall set a date for the final determination of the victim's losses, not to exceed 90 days after sentencing. If the victim subsequently discovers further losses, the victim shall have 60 days after discovery of those losses in which to petition the court for an amended restitution order. Such order may be granted only upon a showing of good cause for the failure to include such losses in the initial claim for restitutionary relief.
`(4) The court may refer any issue arising in connection with a proposed order of restitution to a magistrate or special master for proposed findings of fact and recommendations as to disposition, subject to a de novo determination of the issue by the court.
`(e) Any dispute as to the proper amount or type of restitution shall be resolved by the court by the preponderance of the evidence. The burden of demonstrating the amount of the loss sustained by a victim as a result of the offense shall be on the attorney for the Government. The burden of demonstrating the financial resources of the defendant and the financial needs of the defendant and such defendant's dependents shall be on the defendant. The burden of demonstrating such other matters as the court deems appropriate shall be upon the party designated by the court as justice requires.
`(f)(1)(A) In each order of restitution, the court shall order restitution to each victim in the full amount of each victim's losses as determined by the court and without consideration of the economic circumstances of the defendant.
`(B) In no case shall the fact that a victim has received or is entitled to receive compensation with respect to a loss from insurance or any other source be considered in determining the amount of restitution.
`(2) Upon determination of the amount of restitution owed to each victim, the court shall, pursuant to section 3572, specify in the restitution order the manner in which and the schedule according to which the restitution is to be paid, in consideration of--
`(A) the financial resources and other assets of the defendant, including whether any of these assets are jointly controlled;
`(B) projected earnings and other income of the defendant; and
`(C) any financial obligations of the defendant; including obligations to dependents.
`(3)(A) A restitution order may direct the defendant to make a single, lump-sum payment, partial payment at specified intervals, in-kind payments, or a combination of payments at specified intervals and in-kind payments.
`(B) A restitution order may direct the defendant to make nominal periodic payments if the court finds from facts on the record that the economic circumstances of the defendant do not allow the payment of any amount of a restitution order, and do not allow for the payment of the full amount of a restitution order in the foreseeable future under any reasonable schedule of payments.
`(4) An in-kind payment described in paragraph (3) may be in the form of--
`(B) replacement of property; or
`(C) if the victim agrees, services rendered to the victim or a person or organization other than the victim.
`(g)(1) No victim shall be required to participate in any phase of a restitution order.
`(2) A victim may at any time assign the victim's interest in restitution payments to the Crime Victims Fund in the Treasury without in any way impairing the obligation of the defendant to make such payments.
`(h) If the court finds that more than 1 defendant has contributed to the loss of a victim, the court may make each defendant liable for payment of the full amount of restitution or may apportion liability among the defendants to reflect the level of contribution to the victim's loss and economic circumstances of each defendant.
`(i) If the court finds that more than 1 victim has sustained a loss requiring restitution by a defendant, the court may issue an order of priority based on the type and amount of each victim's loss, accounting for the economic circumstances of each victim. In any case in which the United States is a victim, the court shall ensure that all individual victims receive full restitution before the United States receives any restitution.
`(j)(1) If a victim has received or is entitled to receive compensation with respect to a loss from insurance or any
other source, the court shall order that restitution shall be paid to the person who provided or is obligated to provide the compensation, but the restitution order shall provide that all restitution of victims required by the order be paid to the victims before any restitution is paid to such a provider of compensation.
`(2) Any amount paid to a victim under an order of restitution shall be reduced by any amount later recovered as compensatory damages for the same loss by the victim in--
`(A) any Federal civil proceeding; and
`(B) any State civil proceeding, to the extent provided by the law of the State.
`(k) A restitution order shall provide that the defendant shall notify the court and the Attorney General of any material change in the defendant's economic circumstances that might affect the defendant's ability to pay restitution. The court may also accept notification of a material change in the defendant's economic circumstances from the United States or from the victim. The Attorney General shall certify to the court that the victim or victims owed restitution by the defendant have been notified of the change in circumstances. Upon receipt of the notification, the court may, on its own motion, or the motion of any party, including the victim, adjust the payment schedule, or require immediate payment in full, as the interests of justice require.
`(l) A conviction of a defendant for an offense involving the act giving rise to an order of restitution shall estop the defendant from denying the essential allegations of that offense in any subsequent Federal civil proceeding or State civil proceeding, to the extent consistent with State law, brought by the victim.
`(m)(1)(A)(i) An order of restitution may be enforced by the United States in the manner provided for in subchapter C of chapter 227 and subchapter B of chapter 229 of this title; or (ii) by all other available and reasonable means.
`(B) An order of restitution may also be enforced by a victim named in the order to receive the restitution, in the same manner as a judgment in a civil action.
`(2) An order of in-kind restitution in the form of services shall be enforced by the probation service of the court.
`(n) If a person obligated to provide restitution or pay a fine receives substantial resources from any source, including inheritance, settlement, or other judgment, during a period of incarceration, such person shall be required to apply the value of such resources to any restitution or fine still owed.'.
(b) TECHNICAL AMENDMENT- The item relating to section 3664 in the analysis for chapter 232 of title 18, United States Code, is amended to read as follows:
`3664. Procedure for issuance and enforcement of order of restitution.'.
SEC. 306. PROCEDURE.
(a) AMENDMENT OF FEDERAL RULES OF CRIMINAL PROCEDURE- Rule 32(b) of the Federal Rules of Criminal Procedure is amended--
(1) in paragraph (1), by adding at the end the following: `Notwithstanding the preceding sentence, a presentence investigation and report, or other report containing information sufficient for the court to enter an order of restitution, as the court directs, shall be required in any case in which restitution is required to be ordered.'; and
(A) by redesignating subparagraphs (F) and (G) as subparagraphs (G) and (H), respectively; and
(B) by inserting after subparagraph (E), the following new subparagraph:
`(F) in appropriate cases, information sufficient for the court to enter an order of restitution;'.
(b) FINES- Section 3572 of title 18, United States Code, is amended--
(1) in subsection (b) by inserting `other than the United States,' after `offense,';
(A) in the first sentence, by striking `A person sentenced to pay a fine or other monetary penalty' and inserting `(1) A person sentenced to pay a fine or other monetary penalty, including restitution,';
(B) by striking the third sentence; and
(C) by adding at the end the following:
`(2) If the judgment, or, in the case of a restitution order, the order, permits other than immediate payment, the length of time over which scheduled payments will be made shall be set by the court, but shall be the shortest time in which full payment can reasonably be made.
`(3) A judgment for a fine which permits payments in installments shall include a requirement that the defendant will notify the court of any material change in the defendant's economic circumstances that might affect the defendant's ability to pay the fine. Upon receipt of such notice the court may, on its own motion or the motion of any party, adjust the payment schedule, or require immediate payment in full, as the interests of justice require.';
(3) in subsection (f), by inserting `restitution' after `special assessment,';
(4) in subsection (h), by inserting `or payment of restitution' after `A fine'; and
(A) in the first sentence, by inserting `or payment of restitution' after `A fine'; and
(B) by amending the second sentence to read as follows: `Notwithstanding any installment schedule, when a fine or payment of restitution is in default, the entire amount of the fine or restitution is due within 30 days after notification of the default, subject to the provisions of section 3613A.'.
(c) POSTSENTENCE ADMINISTRATION-
(1) PAYMENT OF A FINE OR RESTITUTION- Section 3611 of title 18, United States Code, is amended--
(A) by amending the heading to read as follows:
`Sec. 3611. Payment of a fine or restitution';
(B) by striking `or assessment shall pay the fine or assessment' and inserting `, assessment, or restitution, shall pay the fine, assessment, or restitution'.
(2) COLLECTION- Section 3612 of title 18, United States, is amended--
(A) by amending the heading to read as follows:
`Sec. 3612. Collection of unpaid fine or restitution';
(B) in subsection (b)(1)--
(i) in the matter preceding subparagraph (A), by inserting `or restitution order' after `fine';
(ii) in subparagraph (C), by inserting `or restitution order' after `fine';
(iii) in subparagraph (E), by striking `and';
(iv) in subparagraph (F)--
(I) by inserting `or restitution order' after `fine'; and
(II) by striking the period at the end and inserting `; and'; and
(v) by adding at the end the following new subparagraph:
`(G) in the case of a restitution order, information sufficient to identify each victim to whom restitution is owed. It shall be the responsibility of each victim to notify the Attorney General, or the appropriate entity of the court, by means of a form to be provided by the Attorney General or the court, of any change in the victim's mailing address while restitution is still owed the victim. The confidentiality of any information relating to a victim shall be maintained.';
(i) in the first sentence, by inserting `or restitution' after `fine'; and
(ii) by adding at the end the following: `Any money received from a defendant shall be disbursed so that each of the following obligations is paid in full in the following sequence:
`(1) A penalty assessment under section 3013 of title 18, United States Code.
`(2) Restitution of all victims.
`(3) All other fines, penalties, costs, and other payments required under the sentence.';
(i) by inserting `or restitution' after `fine'; and
(ii) by striking `is delinquent, to inform him that the fine is delinquent' and inserting `or restitution is delinquent, to inform the person of the delinquency';
(i) by inserting `or restitution' after `fine'; and
(ii) by striking `him that the fine is in default' and inserting `the person that the fine or restitution is in default';
(i) in the heading, by inserting `and restitution' after `on fines'; and
(ii) in paragraph (1), by inserting `or restitution' after `any fine';
(G) in subsection (g), by inserting `or restitution' after `fine' each place it appears; and
(H) in subsection (i), by inserting `and restitution' after `fines'.
(3) CIVIL REMEDIES- Section 3613 of title 18, United States Code, is amended--
(A) in subsection (b), by amending paragraph (1) to read as follows:
`(1) the later of 20 years after the entry of the judgment or 20 years after the release from imprisonment of the person fined or ordered to pay restitution; or'; and
(B) in subsection (e), by striking `, but in no event' and all that follows through the end of the subsection and inserting a period.
(4) DEFAULT- Chapter 229 of title 18, United States Code, is amended by inserting after section 3613 the following new section:
`Sec. 3613A. Effect of default
`(a)(1) Upon a finding that the defendant is in default on a payment of a fine or restitution, the court may, pursuant to section 3565, revoke probation or a term of supervised release or modify the terms or conditions of probation on a term of supervised release, resentence a defendant pursuant to section 3614, hold the defendant in contempt of court, enter a restraining order or injunction, order the sale of property of the defendant, accept a performance bond, enter or adjust a payment schedule, or take any other action necessary to obtain compliance with the order of a fine or restitution.
`(2) In determining what action to take, the court shall consider the defendant's employment status, earning ability, financial resources, the willfulness in failing to comply with the restitution order, and any other circumstances that may have a bearing on the defendant's ability to comply with the order of a fine or restitution.
`(b)(1) Any hearing held pursuant to this section may be conducted by a magistrate judge, subject to de novo review by the court.
`(2) To the extent practicable, in a hearing held pursuant to this section involving a defendant who is confined in any jail, prison, or other correctional facility, proceedings in which the prisoner's participation is required or permitted shall be conducted by telephone, video conference, or other communications technology without removing the prisoner from the facility in which the prisoner is confined.
`(3) Subject to the agreement of the official of the Federal, State, or local unit of government with custody over the prisoner, hearings may be conducted at the facility in which the prisoner is confined. To the extent practicable, the court shall allow counsel to participate by telephone, video conference, or other communications technology in any hearing held at the facility.'.
(5) RESENTENCING- Section 3614 of title 18, United States Code, is amended--
(A) in the heading, by inserting `or restitution' after `fine';
(B) in subsection (a), by inserting `or restitution' after `fine'; and
(C) by adding at the end the following new subsection:
`(c) EFFECT OF INDIGENCY- In no event shall a defendant be incarcerated under this section solely on the basis of inability to make payments because the defendant is indigent.'.
(d) CONFORMING AMENDMENT- The analysis for subchapter B of chapter 229 of title 18, United States Code, is amended to read as follows:
`Sec.
`3611. Payment of a fine or restitution.
`3612. Collection of an unpaid fine or restitution.
`3613. Civil remedies for collection of an unpaid fine or restitution.
`3613A. Effect of default.
`3614. Resentencing upon failure to pay a fine or restitution.
`3615. Criminal default.'.
SEC. 307. INSTRUCTION TO SENTENCING COMMISSION.
Pursuant to section 994 of title 28, United States Code, the United States Sentencing Commission shall promulgate guidelines or amend existing guidelines to reflect this subtitle and the amendments made by this subtitle.
SEC. 308. JUSTICE DEPARTMENT REGULATIONS.
Not later than 90 days after the date of enactment of this Act, the Attorney General shall promulgate guidelines, or amend existing guidelines, to carry out this subtitle and to ensure that--
(1) in all plea agreements negotiated by the United States, consideration is given to requesting that the defendant provide full restitution to all victims of all charges contained in the indictment or information, without regard to the counts to which the defendant actually pleaded; and
(2) orders of restitution made pursuant to the amendments made by this subtitle are enforced to the fullest extent of the law.
SEC. 309. SPECIAL ASSESSMENTS ON CONVICTED PERSONS.
Section 3013(a)(2) of title 18, United States Code, is amended--
(1) in subparagraph (A), by striking `$50' and inserting `not less than $100'; and
(2) in subparagraph (B), by striking `$200' and inserting `not less than $400'.
SEC. 310. CRIME VICTIMS FUND.
(a) PROHIBITION OF PAYMENTS TO DELINQUENT CRIMINAL DEBTORS BY STATE CRIME VICTIM COMPENSATION PROGRAMS-
(1) IN GENERAL- Section 1403(b) of the Victims of Crime Act of 1984 (42 U.S.C. 10602(b)) is amended--
(A) by striking `and' at the end of paragraph (7);
(B) by redesignating paragraph (8) as paragraph (9); and
(C) by inserting after paragraph (7) the following new paragraph:
`(8) such program does not provide compensation to any person who has been convicted of an offense under Federal law with respect to any time period during which the person is delinquent in paying a fine or other monetary penalty imposed for the offense; and'.
(2) APPLICATION OF AMENDMENT- The amendment made by paragraph (1) shall not be applied to deny victims compensation to any person until the date on which the Attorney General, in consultation with the Director of the Administrative Office of the United States Courts, issues a written determination that a cost-effective, readily available criminal debt payment tracking system operated by the agency responsible for the collection of criminal debt has established cost-effective, readily available communications links with entities that administer Federal victims compensation programs that are sufficient to ensure that victims compensation is not denied to any person except as authorized by law.
(b) EXCLUSION FROM INCOME FOR PURPOSES OF MEANS TESTS- Section 1403 of the Victims of Crime Act of 1984 (42 U.S.C. 10602) is amended by inserting after subsection (b) the following new subsection:
`(c) EXCLUSION FROM INCOME FOR PURPOSES OF MEANS TESTS- Notwithstanding any other law, for the purpose of any maximum allowed income eligibility requirement in any Federal, State, or local government program using Federal funds that provides medical or other assistance (or payment or reimbursement of the cost of such assistance) that becomes necessary to an applicant for such assistance in full or in part because of the commission of a crime against the applicant, as determined by the Director, any amount of crime victim compensation that the applicant receives through a crime victim compensation program under this section shall not be included in the income of the applicant until the total amount of assistance that the applicant receives from all such programs is sufficient to fully compensate the applicant for losses suffered as a result of the crime.'.
SEC. 311. VICTIMS OF TERRORISM ACT.
(a) AUTHORITY TO PROVIDE ASSISTANCE AND COMPENSATION TO VICTIMS OF TERRORISM- The Victims of Crime Act of 1984 (42 U.S.C. 10601 et seq.) is amended by inserting after section 1404A the following new section:
`SEC. 1404B. COMPENSATION AND ASSISTANCE TO VICTIMS OF TERRORISM OR MASS VIOLENCE.
`(a) VICTIMS OF ACTS OF TERRORISM OUTSIDE THE UNITED STATES- The Director may make supplemental grants to States to provide compensation and assistance to the residents of such States who, while outside the territorial boundaries of the United States, are victims of a terrorist act or mass violence and are not persons eligible for compensation under title VIII of the Omnibus Diplomatic Security and Antiterrorism Act of 1986.
`(b) VICTIMS OF DOMESTIC TERRORISM- The Director may make supplemental grants to States for eligible crime victim compensation and assistance programs to provide emergency relief, including crisis response efforts, assistance, training, and technical assistance, for the benefit of victims of terrorist acts or mass violence occurring within the United States and may provide funding to United States Attorney's Offices for use in coordination with State victims compensation and assistance efforts in providing emergency relief.'.
(b) FUNDING OF COMPENSATION AND ASSISTANCE TO VICTIMS OF TERRORISM, MASS VIOLENCE, AND CRIME- Section 1402(d)(4) of the Victims of Crime Act of 1984 (42 U.S.C. 10601(d)(4)) is amended to read as follows:
`(4)(A) If the sums available in the Fund are sufficient to fully provide grants to the States pursuant to section 1403(a)(1), the Director may retain any portion of the Fund that was deposited during a fiscal year that was in excess of 110 percent of the total amount deposited in the Fund during the preceding fiscal year as an emergency reserve. Such reserve shall not exceed $50,000,000.
`(B) The emergency reserve may be used for supplemental grants under section 1404B and to supplement the funds available to provide grants to States for compensation and assistance in accordance with sections 1403 and 1404 in years in which supplemental grants are needed.'.
(c) CRIME VICTIMS FUND AMENDMENTS-
(1) UNOBLIGATED FUNDS- Section 1402 of the Victims of Crime Act of 1984 (42 U.S.C. 10601) is amended--
(A) in subsection (c), by striking `subsection' and inserting `chapter'; and
(B) by amending subsection (e) to read as follows:
`(e) AMOUNTS AWARDED AND UNSPENT- Any amount awarded as part of a grant under this chapter that remains unspent at the end of a fiscal year in which the grant is made may be expended for the purpose for which the gra
