[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1180 Enrolled Bill (ENR)]
H.R.1180
One Hundred Sixth Congress
of the
United States of America
AT THE FIRST SESSION
Begun and held at the City of Washington on Wednesday,
the sixth day of January, one thousand nine hundred and ninety-nine
An Act
To amend the Social Security Act to expand the availability of health
care coverage for working individuals with disabilities, to establish a
Ticket to Work and Self-Sufficiency Program in the Social Security
Administration to provide such individuals with meaningful opportunities
to work, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,

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(a) Short Title.--This Act may be cited as the ``Ticket to Work and
Work Incentives Improvement Act of 1999''.
(b) Table of Contents.--The table of contents is as follows:

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Subtitle A--Ticket to Work and Self-Sufficiency

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Program.
Subtitle B--Elimination of Work Disincentives

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TITLE I

-TICKET TO WORK AND SELF-SUFFICIENCY AND RELATED PROVISIONS

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Subtitle C--Work Incentives Planning, Assistance, and Outreach

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TITLE II

-EXPANDED AVAILABILITY OF HEALTH CARE SERVICES

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support working individuals with disabilities.

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workers with potentially severe disabilities.

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insurance when covered under a group health plan.

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TITLE III

-DEMONSTRATION PROJECTS AND STUDIES

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TITLE IV

-MISCELLANEOUS AND TECHNICAL AMENDMENTS

research or demonstration projects under titles II and XVI.

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TITLE V

-TAX RELIEF EXTENSION ACT OF 1999

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Puerto Rico and Virgin Islands.
Subtitle B--Other Time-Sensitive Provisions

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Subtitle C--Revenue Offsets
Part I--General Provisions

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associated with split-dollar insurance arrangements.

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in another corporation.
Part II--Provisions Relating to Real Estate Investment Trusts
SUBPART A--TREATMENT OF INCOME AND SERVICES PROVIDED BY TAXABLE REIT
SUBSIDIARIES

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SUBPART C--CONFORMITY WITH REGULATED INVESTMENT COMPANY RULES

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SUBPART D--CLARIFICATION OF EXCEPTION FROM IMPERMISSIBLE TENANT
SERVICE INCOME

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SUBPART E--MODIFICATION OF EARNINGS AND PROFITS RULES

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SUBPART F--MODIFICATION OF ESTIMATED TAX RULES

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(a) Findings.--The Congress makes the following findings:
(1) It is the policy of the United States to provide assistance
to individuals with disabilities to lead productive work lives.
(2) Health care is important to all Americans.
(3) Health care is particularly important to individuals with
disabilities and special health care needs who often cannot afford
the insurance available to them through the private market, are
uninsurable by the plans available in the private sector, and are
at great risk of incurring very high and economically devastating
health care costs.
(4) Americans with significant disabilities often are unable to
obtain health care insurance that provides coverage of the services
and supports that enable them to live independently and enter or
rejoin the workforce. Personal assistance services (such as
attendant services, personal assistance with transportation to and
from work, reader services, job coaches, and related assistance)
remove many of the barriers between significant disability and
work. Coverage for such services, as well as for prescription
drugs, durable medical equipment, and basic health care are
powerful and proven tools for individuals with significant
disabilities to obtain and retain employment.
(5) For individuals with disabilities, the fear of losing
health care and related services is one of the greatest barriers
keeping the individuals from maximizing their employment, earning
potential, and independence.
(6) Social Security Disability Insurance and Supplemental
Security Income beneficiaries risk losing medicare or medicaid
coverage that is linked to their cash benefits, a risk that is an
equal, or greater, work disincentive than the loss of cash benefits
associated with working.
(7) Individuals with disabilities have greater opportunities
for employment than ever before, aided by important public policy
initiatives such as the Americans with Disabilities Act of 1990 (42
U.S.C. 12101 et seq.), advancements in public understanding of
disability, and innovations in assistive technology, medical
treatment, and rehabilitation.
(8) Despite such historic opportunities and the desire of
millions of disability recipients to work and support themselves,
fewer than one-half of one percent of Social Security Disability
Insurance and Supplemental Security Income beneficiaries leave the
disability rolls and return to work.
(9) In addition to the fear of loss of health care coverage,
beneficiaries cite financial disincentives to work and earn income
and lack of adequate employment training and placement services as
barriers to employment.
(10) Eliminating such barriers to work by creating financial
incentives to work and by providing individuals with disabilities
real choice in obtaining the services and technology they need to
find, enter, and maintain employment can greatly improve their
short and long-term financial independence and personal well-being.
(11) In addition to the enormous advantages such changes
promise for individuals with disabilities, redesigning government
programs to help individuals with disabilities return to work may
result in significant savings and extend the life of the Social
Security Disability Insurance Trust Fund.
(12) If only an additional one-half of one percent of the
current Social Security Disability Insurance and Supplemental
Security Income recipients were to cease receiving benefits as a
result of employment, the savings to the Social Security Trust
Funds and to the Treasury in cash assistance would total
$3,500,000,000 over the worklife of such individuals, far exceeding
the cost of providing incentives and services needed to assist them
in entering work and achieving financial independence to the best
of their abilities.
(b) Purposes.--The purposes of this Act are as follows:
(1) To provide health care and employment preparation and
placement services to individuals with disabilities that will
enable those individuals to reduce their dependency on cash benefit
programs.
(2) To encourage States to adopt the option of allowing
individuals with disabilities to purchase medicaid coverage that is
necessary to enable such individuals to maintain employment.
(3) To provide individuals with disabilities the option of
maintaining medicare coverage while working.
(4) To establish a return to work ticket program that will
allow individuals with disabilities to seek the services necessary
to obtain and retain employment and reduce their dependency on cash
benefit programs.
Subtitle A--Ticket to Work and Self-Sufficiency

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INDIVIDUAL'S DISABLED STATUS.
(a) In General.--Section 221 of the Social Security Act (42 U.S.C.
421) is amended by adding at the end the following new subsection:
``(m)(1) In any case where an individual entitled to disability
insurance benefits under section 223 or to monthly insurance benefits
under section 202 based on such individual's disability (as defined in
section 223(d)) has received such benefits for at least 24 months--
``(A) no continuing disability review conducted by the
Commissioner may be scheduled for the individual solely as a result
of the individual's work activity;
``(B) no work activity engaged in by the individual may be used
as evidence that the individual is no longer disabled; and
``(C) no cessation of work activity by the individual may give
rise to a presumption that the individual is unable to engage in
work.
``(2) An individual to which paragraph (1) applies shall continue
to be subject to--
``(A) continuing disability reviews on a regularly scheduled
basis that is not triggered by work; and
``(B) termination of benefits under this title in the event
that the individual has earnings that exceed the level of earnings
established by the Commissioner to represent substantial gainful
activity.''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect on January 1, 2002.

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(a) OASDI Benefits.--Section 223 of the Social Security Act (42
U.S.C. 423) is amended--
(1) by redesignating subsection (i) as subsection (j); and
(2) by inserting after subsection (h) the following new
subsection:
``Reinstatement of Entitlement
``(i)(1)(A) Entitlement to benefits described in subparagraph
(B)(i)(I) shall be reinstated in any case where the Commissioner
determines that an individual described in subparagraph (B) has filed a
request for reinstatement meeting the requirements of paragraph (2)(A)
during the period prescribed in subparagraph (C). Reinstatement of such
entitlement shall be in accordance with the terms of this subsection.
``(B) An individual is described in this subparagraph if--
``(i) prior to the month in which the individual files a
request for reinstatement--
``(I) the individual was entitled to benefits under this
section or section 202 on the basis of disability pursuant to
an application filed therefor; and
``(II) such entitlement terminated due to the performance
of substantial gainful activity;
``(ii) the individual is under a disability and the physical or
mental impairment that is the basis for the finding of disability
is the same as (or related to) the physical or mental impairment
that was the basis for the finding of disability that gave rise to
the entitlement described in clause (i); and
``(iii) the individual's disability renders the individual
unable to perform substantial gainful activity.
``(C)(i) Except as provided in clause (ii), the period prescribed
in this subparagraph with respect to an individual is 60 consecutive
months beginning with the month following the most recent month for
which the individual was entitled to a benefit described in
subparagraph (B)(i)(I) prior to the entitlement termination described
in subparagraph (B)(i)(II).
``(ii) In the case of an individual who fails to file a
reinstatement request within the period prescribed in clause (i), the
Commissioner may extend the period if the Commissioner determines that
the individual had good cause for the failure to so file.
``(2)(A)(i) A request for reinstatement shall be filed in such
form, and containing such information, as the Commissioner may
prescribe.
``(ii) A request for reinstatement shall include express
declarations by the individual that the individual meets the
requirements specified in clauses (ii) and (iii) of paragraph (1)(B).
``(B) A request for reinstatement filed in accordance with
subparagraph (A) may constitute an application for benefits in the case
of any individual who the Commissioner determines is not entitled to
reinstated benefits under this subsection.
``(3) In determining whether an individual meets the requirements
of paragraph (1)(B)(ii), the provisions of subsection (f) shall apply.
``(4)(A)(i) Subject to clause (ii), entitlement to benefits
reinstated under this subsection shall commence with the benefit
payable for the month in which a request for reinstatement is filed.
``(ii) An individual whose entitlement to a benefit for any month
would have been reinstated under this subsection had the individual
filed a request for reinstatement before the end of such month shall be
entitled to such benefit for such month if such request for
reinstatement is filed before the end of the twelfth month immediately
succeeding such month.
``(B)(i) Subject to clauses (ii) and (iii), the amount of the
benefit payable for any month pursuant to the reinstatement of
entitlement under this subsection shall be determined in accordance
with the provisions of this title.
``(ii) For purposes of computing the primary insurance amount of an
individual whose entitlement to benefits under this section is
reinstated under this subsection, the date of onset of the individual's
disability shall be the date of onset used in determining the
individual's most recent period of disability arising in connection
with such benefits payable on the basis of an application.
``(iii) Benefits under this section or section 202 payable for any
month pursuant to a request for reinstatement filed in accordance with
paragraph (2) shall be reduced by the amount of any provisional benefit
paid to such individual for such month under paragraph (7).
``(C) No benefit shall be payable pursuant to an entitlement
reinstated under this subsection to an individual for any month in
which the individual engages in substantial gainful activity.
``(D) The entitlement of any individual that is reinstated under
this subsection shall end with the benefits payable for the month
preceding whichever of the following months is the earliest:
``(i) The month in which the individual dies.
``(ii) The month in which the individual attains retirement
age.
``(iii) The third month following the month in which the
individual's disability ceases.
``(5) Whenever an individual's entitlement to benefits under this
section is reinstated under this subsection, entitlement to benefits
payable on the basis of such individual's wages and self-employment
income may be reinstated with respect to any person previously entitled
to such benefits on the basis of an application if the Commissioner
determines that such person satisfies all the requirements for
entitlement to such benefits except requirements related to the filing
of an application. The provisions of paragraph (4) shall apply to the
reinstated entitlement of any such person to the same extent that they
apply to the reinstated entitlement of such individual.
``(6) An individual to whom benefits are payable under this section
or section 202 pursuant to a reinstatement of entitlement under this
subsection for 24 months (whether or not consecutive) shall, with
respect to benefits so payable after such twenty-fourth month, be
deemed for purposes of paragraph (1)(B)(i)(I) and the determination, if
appropriate, of the termination month in accordance with subsection
(a)(1) of this section, or subsection (d)(1), (e)(1), or (f)(1) of
section 202, to be entitled to such benefits on the basis of an
application filed therefor.
``(7)(A) An individual described in paragraph (1)(B) who files a
request for reinstatement in accordance with the provisions of
paragraph (2)(A) shall be entitled to provisional benefits payable in
accordance with this paragraph, unless the Commissioner determines that
the individual does not meet the requirements of paragraph (1)(B)(i) or
that the individual's declaration under paragraph (2)(A)(ii) is false.
Any such determination by the Commissioner shall be final and not
subject to review under subsection (b) or (g) of section 205.
``(B) The amount of a provisional benefit for a month shall equal
the amount of the last monthly benefit payable to the individual under
this title on the basis of an application increased by an amount equal
to the amount, if any, by which such last monthly benefit would have
been increased as a result of the operation of section 215(i).
``(C)(i) Provisional benefits shall begin with the month in which a
request for reinstatement is filed in accordance with paragraph (2)(A).
``(ii) Provisional benefits shall end with the earliest of--
``(I) the month in which the Commissioner makes a determination
regarding the individual's entitlement to reinstated benefits;
``(II) the fifth month following the month described in clause
(i);
``(III) the month in which the individual performs substantial
gainful activity; or
``(IV) the month in which the Commissioner determines that the
individual does not meet the requirements of paragraph (1)(B)(i) or
that the individual's declaration made in accordance with paragraph
(2)(A)(ii) is false.
``(D) In any case in which the Commissioner determines that an
individual is not entitled to reinstated benefits, any provisional
benefits paid to the individual under this paragraph shall not be
subject to recovery as an overpayment unless the Commissioner
determines that the individual knew or should have known that the
individual did not meet the requirements of paragraph (1)(B).''.
(b) SSI Benefits.--
(1) In general.--Section 1631 of the Social Security Act (42
U.S.C. 1383) is amended by adding at the end the following new
subsection:
``Reinstatement of Eligibility on the Basis of Blindness or Disability
``(p)(1)(A) Eligibility for benefits under this title shall be
reinstated in any case where the Commissioner determines that an
individual described in subparagraph (B) has filed a request for
reinstatement meeting the requirements of paragraph (2)(A) during the
period prescribed in subparagraph (C). Reinstatement of eligibility
shall be in accordance with the terms of this subsection.
``(B) An individual is described in this subparagraph if--
``(i) prior to the month in which the individual files a
request for reinstatement--
``(I) the individual was eligible for benefits under this
title on the basis of blindness or disability pursuant to an
application filed therefor; and
``(II) the individual thereafter was ineligible for such
benefits due to earned income (or earned and unearned income)
for a period of 12 or more consecutive months;
``(ii) the individual is blind or disabled and the physical or
mental impairment that is the basis for the finding of blindness or
disability is the same as (or related to) the physical or mental
impairment that was the basis for the finding of blindness or
disability that gave rise to the eligibility described in clause
(i);
``(iii) the individual's blindness or disability renders the
individual unable to perform substantial gainful activity; and
``(iv) the individual satisfies the nonmedical requirements for
eligibility for benefits under this title.
``(C)(i) Except as provided in clause (ii), the period prescribed
in this subparagraph with respect to an individual is 60 consecutive
months beginning with the month following the most recent month for
which the individual was eligible for a benefit under this title
(including section 1619) prior to the period of ineligibility described
in subparagraph (B)(i)(II).
``(ii) In the case of an individual who fails to file a
reinstatement request within the period prescribed in clause (i), the
Commissioner may extend the period if the Commissioner determines that
the individual had good cause for the failure to so file.
``(2)(A)(i) A request for reinstatement shall be filed in such
form, and containing such information, as the Commissioner may
prescribe.
``(ii) A request for reinstatement shall include express
declarations by the individual that the individual meets the
requirements specified in clauses (ii) through (iv) of paragraph
(1)(B).
``(B) A request for reinstatement filed in accordance with
subparagraph (A) may constitute an application for benefits in the case
of any individual who the Commissioner determines is not eligible for
reinstated benefits under this subsection.
``(3) In determining whether an individual meets the requirements
of paragraph (1)(B)(ii), the provisions of section 1614(a)(4) shall
apply.
``(4)(A) Eligibility for benefits reinstated under this subsection
shall commence with the benefit payable for the month following the
month in which a request for reinstatement is filed.
``(B)(i) Subject to clause (ii), the amount of the benefit payable
for any month pursuant to the reinstatement of eligibility under this
subsection shall be determined in accordance with the provisions of
this title.
``(ii) The benefit under this title payable for any month pursuant
to a request for reinstatement filed in accordance with paragraph (2)
shall be reduced by the amount of any provisional benefit paid to such
individual for such month under paragraph (7).
``(C) Except as otherwise provided in this subsection, eligibility
for benefits under this title reinstated pursuant to a request filed
under paragraph (2) shall be subject to the same terms and conditions
as eligibility established pursuant to an application filed therefor.
``(5) Whenever an individual's eligibility for benefits under this
title is reinstated under this subsection, eligibility for such
benefits shall be reinstated with respect to the individual's spouse if
such spouse was previously an eligible spouse of the individual under
this title and the Commissioner determines that such spouse satisfies
all the requirements for eligibility for such benefits except
requirements related to the filing of an application. The provisions of
paragraph (4) shall apply to the reinstated eligibility of the spouse
to the same extent that they apply to the reinstated eligibility of
such individual.
``(6) An individual to whom benefits are payable under this title
pursuant to a reinstatement of eligibility under this subsection for
twenty-four months (whether or not consecutive) shall, with respect to
benefits so payable after such twenty-fourth month, be deemed for
purposes of paragraph (1)(B)(i)(I) to be eligible for such benefits on
the basis of an application filed therefor.
``(7)(A) An individual described in paragraph (1)(B) who files a
request for reinstatement in accordance with the provisions of
paragraph (2)(A) shall be eligible for provisional benefits payable in
accordance with this paragraph, unless the Commissioner determines that
the individual does not meet the requirements of paragraph (1)(B)(i) or
that the individual's declaration under paragraph (2)(A)(ii) is false.
Any such determination by the Commissioner shall be final and not
subject to review under paragraph (1) or (3) of subsection (c).
``(B)(i) Except as otherwise provided in clause (ii), the amount of
a provisional benefit for a month shall equal the amount of the monthly
benefit that would be payable to an eligible individual under this
title with the same kind and amount of income.
``(ii) If the individual has a spouse who was previously an
eligible spouse of the individual under this title and the Commissioner
determines that such spouse satisfies all the requirements of section
1614(b) except requirements related to the filing of an application,
the amount of a provisional benefit for a month shall equal the amount
of the monthly benefit that would be payable to an eligible individual
and eligible spouse under this title with the same kind and amount of
income.
``(C)(i) Provisional benefits shall begin with the month following
the month in which a request for reinstatement is filed in accordance
with paragraph (2)(A).
``(ii) Provisional benefits shall end with the earliest of--
``(I) the month in which the Commissioner makes a determination
regarding the individual's eligibility for reinstated benefits;
``(II) the fifth month following the month for which
provisional benefits are first payable under clause (i); or
``(III) the month in which the Commissioner determines that the
individual does not meet the requirements of paragraph (1)(B)(i) or
that the individual's declaration made in accordance with paragraph
(2)(A)(ii) is false.
``(D) In any case in which the Commissioner determines that an
individual is not eligible for reinstated benefits, any provisional
benefits paid to the individual under this paragraph shall not be
subject to recovery as an overpayment unless the Commissioner
determines that the individual knew or should have known that the
individual did not meet the requirements of paragraph (1)(B).
``(8) For purposes of this subsection other than paragraph (7), the
term `benefits under this title' includes State supplementary payments
made pursuant to an agreement under section 1616(a) of this Act or
section 212(b) of Public Law 93-66.''.
(2) Conforming amendments.--
(A) Section 1631(j)(1) of such Act (42 U.S.C. 1383(j)(1))
is amended by striking the period and inserting ``, or has
filed a request for reinstatement of eligibility under
subsection (p)(2) and been determined to be eligible for
reinstatement.''.
(B) Section 1631(j)(2)(A)(i)(I) of such Act (42 U.S.C.
1383(j)(2)(A)(i)(I)) is amended by inserting ``(other than
pursuant to a request for reinstatement under subsection (p))''
after ``eligible''.
(c) Effective Date.--
(1) In general.--The amendments made by this section shall take
effect on the first day of the thirteenth month beginning after the
date of the enactment of this Act.
(2) Limitation.--No benefit shall be payable under title II or
XVI on the basis of a request for reinstatement filed under section
223(i) or 1631(p) of the Social Security Act (42 U.S.C. 423(i),
1383(p)) before the effective date described in paragraph (1).
Subtitle C--Work Incentives Planning, Assistance, and Outreach

ae965cb3248d7ae5e03773c285d9a7de4c99aae1e25d4ae340f0caeefa7093d8

Part A of title XI of the Social Security Act (42 U.S.C. 1301 et
seq.), as amended by section 101 of this Act, is amended by adding
after section 1148 the following new section:
``work incentives outreach program
``Sec. 1149. (a) Establishment.--
``(1) In general.--The Commissioner, in consultation with the
Ticket to Work and Work Incentives Advisory Panel established under
section 101(f) of the Ticket to Work and Work Incentives
Improvement Act of 1999, shall establish a community-based work
incentives planning and assistance program for the purpose of
disseminating accurate information to disabled beneficiaries on
work incentives programs and issues related to such programs.
``(2) Grants, cooperative agreements, contracts, and
outreach.--Under the program established under this section, the
Commissioner shall--
``(A) establish a competitive program of grants,
cooperative agreements, or contracts to provide benefits
planning and assistance, including information on the
availability of protection and advocacy services, to disabled
beneficiaries, including individuals participating in the
Ticket to Work and Self-Sufficiency Program established under
section 1148, the program established under section 1619, and
other programs that are designed to encourage disabled
beneficiaries to work;
``(B) conduct directly, or through grants, cooperative
agreements, or contracts, ongoing outreach efforts to disabled
beneficiaries (and to the families of such beneficiaries) who
are potentially eligible to participate in Federal or State
work incentive programs that are designed to assist disabled
beneficiaries to work, including--
``(i) preparing and disseminating information
explaining such programs; and
``(ii) working in cooperation with other Federal,
State, and private agencies and nonprofit organizations
that serve disabled beneficiaries, and with agencies and
organizations that focus on vocational rehabilitation and
work-related training and counseling;
``(C) establish a corps of trained, accessible, and
responsive work incentives specialists within the Social
Security Administration who will specialize in disability work
incentives under titles II and XVI for the purpose of
disseminating accurate information with respect to inquiries
and issues relating to work incentives to--
``(i) disabled beneficiaries;
``(ii) benefit applicants under titles II and XVI; and
``(iii) individuals or entities awarded grants under
subparagraphs (A) or (B); and
``(D) provide--
``(i) training for work incentives specialists and
individuals providing planning assistance described in
subparagraph (C); and
``(ii) technical assistance to organizations and
entities that are designed to encourage disabled
beneficiaries to return to work.
``(3) Coordination with other programs.--The responsibilities
of the Commissioner established under this section shall be
coordinated with other public and private programs that provide
information and assistance regarding rehabilitation services and
independent living supports and benefits planning for disabled
beneficiaries including the program under section 1619, the plans
for achieving self-support program (PASS), and any other Federal or
State work incentives programs that are designed to assist disabled
beneficiaries, including educational agencies that provide
information and assistance regarding rehabilitation, school-to-work
programs, transition services (as defined in, and provided in
accordance with, the Individuals with Disabilities Education Act
(20 U.S.C. 1400 et seq.)), a one-stop delivery system established
under subtitle B of title I of the Workforce Investment Act of 1998
(29 U.S.C. 2811 et seq.), and other services.
``(b) Conditions.--
``(1) Selection of entities.--
``(A) Application.--An entity shall submit an application
for a grant, cooperative agreement, or contract to provide
benefits planning and assistance to the Commissioner at such
time, in such manner, and containing such information as the
Commissioner may determine is necessary to meet the
requirements of this section.
``(B) Statewideness.--The Commissioner shall ensure that
the planning, assistance, and information described in
paragraph (2) shall be available on a statewide basis.
``(C) Eligibility of states and private organizations.--
``(i) In general.--The Commissioner may award a grant,
cooperative agreement, or contract under this section to a
State or a private agency or organization (other than
Social Security Administration Field Offices and the State
agency administering the State medicaid program under title
XIX, including any agency or entity described in clause
(ii), that the Commissioner determines is qualified to
provide the planning, assistance, and information described
in paragraph (2)).
``(ii) Agencies and entities described.--The agencies
and entities described in this clause are the following:
``(I) Any public or private agency or organization
(including Centers for Independent Living established
under title VII of the Rehabilitation Act of 1973 (29
U.S.C. 796 et seq.), protection and advocacy
organizations, client assistance programs established
in accordance with section 112 of the Rehabilitation
Act of 1973 (29 U.S.C. 732), and State Developmental
Disabilities Councils established in accordance with
section 124 of the Developmental Disabilities
Assistance and Bill of Rights Act (42 U.S.C. 6024))
that the Commissioner determines satisfies the
requirements of this section.
``(II) The State agency administering the State
program funded under part A of title IV.
``(D) Exclusion for conflict of interest.--The Commissioner
may not award a grant, cooperative agreement, or contract under
this section to any entity that the Commissioner determines
would have a conflict of interest if the entity were to receive
a grant, cooperative agreement, or contract under this section.
``(2) Services provided.--A recipient of a grant, cooperative
agreement, or contract to provide benefits planning and assistance
shall select individuals who will act as planners and provide
information, guidance, and planning to disabled beneficiaries on
the--
``(A) availability and interrelation of any Federal or
State work incentives programs designed to assist disabled
beneficiaries that the individual may be eligible to
participate in;
``(B) adequacy of any health benefits coverage that may be
offered by an employer of the individual and the extent to
which other health benefits coverage may be available to the
individual; and
``(C) availability of protection and advocacy services for
disabled beneficiaries and how to access such services.
``(3) Amount of grants, cooperative agreements, or contracts.--
``(A) Based on population of disabled beneficiaries.--
Subject to subparagraph (B), the Commissioner shall award a
grant, cooperative agreement, or contract under this section to
an entity based on the percentage of the population of the
State where the entity is located who are disabled
beneficiaries.
``(B) Limitations.--
``(i) Per grant.--No entity shall receive a grant,
cooperative agreement, or contract under this section for a
fiscal year that is less than $50,000 or more than
$300,000.
``(ii) Total amount for all grants, cooperative
agreements, and contracts.--The total amount of all grants,
cooperative agreements, and contracts awarded under this
section for a fiscal year may not exceed $23,000,000.
``(4) Allocation of costs.--The costs of carrying out this
section shall be paid from amounts made available for the
administration of title II and amounts made available for the
administration of title XVI, and shall be allocated among those
amounts as appropriate.
``(c) Definitions.--In this section:
``(1) Commissioner.--The term `Commissioner' means the
Commissioner of Social Security.
``(2) Disabled beneficiary.--The term `disabled beneficiary'
has the meaning given that term in section 1148(k)(2).
``(d) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section $23,000,000 for each of the
fiscal years 2000 through 2004.''.

406a349b1e354f944a0d46dc5920fb3dc932c2ef4a41c439ee1e7e67fcb63f0a

BENEFICIARIES.
Part A of title XI of the Social Security Act (42 U.S.C. 1301 et
seq.), as amended by section 121 of this Act, is amended by adding
after section 1149 the following new section:
``state grants for work incentives assistance to disabled
beneficiaries
``Sec. 1150. (a) In General.--Subject to subsection (c), the
Commissioner may make payments in each State to the protection and
advocacy system established pursuant to part C of title I of the
Developmental Disabilities Assistance and Bill of Rights Act (42 U.S.C.
6041 et seq.) for the purpose of providing services to disabled
beneficiaries.
``(b) Services Provided.--Services provided to disabled
beneficiaries pursuant to a payment made under this section may
include--
``(1) information and advice about obtaining vocational
rehabilitation and employment services; and
``(2) advocacy or other services that a disabled beneficiary
may need to secure or regain gainful employment.
``(c) Application.--In order to receive payments under this
section, a protection and advocacy system shall submit an application
to the Commissioner, at such time, in such form and manner, and
accompanied by such information and assurances as the Commissioner may
require.
``(d) Amount of Payments.--
``(1) In general.--Subject to the amount appropriated for a
fiscal year for making payments under this section, a protection
and advocacy system shall not be paid an amount that is less than--
``(A) in the case of a protection and advocacy system
located in a State (including the District of Columbia and
Puerto Rico) other than Guam, American Samoa, the United States
Virgin Islands, and the Commonwealth of the Northern Mariana
Islands, the greater of--
``(i) $100,000; or
``(ii) \1/3\ of 1 percent of the amount available for
payments under this section; and
``(B) in the case of a protection and advocacy system
located in Guam, American Samoa, the United States Virgin
Islands, and the Commonwealth of the Northern Mariana Islands,
$50,000.
``(2) Inflation adjustment.--For each fiscal year in which the
total amount appropriated to carry out this section exceeds the
total amount appropriated to carry out this section in the
preceding fiscal year, the Commissioner shall increase each minimum
payment under subparagraphs (A) and (B) of paragraph (1) by a
percentage equal to the percentage increase in the total amount so
appropriated to carry out this section.
``(e) Annual Report.--Each protection and advocacy system that
receives a payment under this section shall submit an annual report to
the Commissioner and the Ticket to Work and Work Incentives Advisory
Panel established under section 101(f) of the Ticket to Work and Work
Incentives Improvement Act of 1999 on the services provided to
individuals by the system.
``(f) Funding.--
``(1) Allocation of payments.--Payments under this section
shall be made from amounts made available for the administration of
title II and amounts made available for the administration of title
XVI, and shall be allocated among those amounts as appropriate.
``(2) Carryover.--Any amounts allotted for payment to a
protection and advocacy system under this section for a fiscal year
shall remain available for payment to or on behalf of the
protection and advocacy system until the end of the succeeding
fiscal year.
``(g) Definitions.--In this section:
``(1) Commissioner.--The term `Commissioner' means the
Commissioner of Social Security.
``(2) Disabled beneficiary.--The term `disabled beneficiary'
has the meaning given that term in section 1148(k)(2).
``(3) Protection and advocacy system.--The term `protection and
advocacy system' means a protection and advocacy system established
pursuant to part C of title I of the Developmental Disabilities
Assistance and Bill of Rights Act (42 U.S.C. 6041 et seq.).
``(h) Authorization of Appropriations.--There are authorized to be
appropriated to carry out this section $7,000,000 for each of the
fiscal years 2000 through 2004.''.

b86dbf5bd28ba9cf9eff3fa75af0c012f5f382c7df54f65141d8d46b79da5ee4

WORKERS WITH DISABILITIES.
(a) In General.--
(1) State option to eliminate income, assets, and resource
limitations for workers with disabilities buying into medicaid.--
Section 1902(a)(10)(A)(ii) of the Social Security Act (42 U.S.C.
1396a(a)(10)(A)(ii)) is amended--
(A) in subclause (XIII), by striking ``or'' at the end;
(B) in subclause (XIV), by adding ``or'' at the end; and
(C) by adding at the end the following new subclause:
``(XV) who, but for earnings in excess of the limit
established under section 1905(q)(2)(B), would be
considered to be receiving supplemental security
income, who is at least 16, but less than 65, years of
age, and whose assets, resources, and earned or
unearned income (or both) do not exceed such
limitations (if any) as the State may establish;''.
(2) State option to provide opportunity for employed
individuals with a medically improved disability to buy into
medicaid.--
(A) Eligibility.--Section 1902(a)(10) (A)(ii) of the Social
Security Act (42 U.S.C. 1396a(a)(10)(A)(ii)), as amended by
paragraph (1), is amended--
(i) in subclause (XIV), by striking ``or'' at the end;
(ii) in subclause (XV), by adding ``or'' at the end;
and
(iii) by adding at the end the following new subclause:
``(XVI) who are employed individuals with a
medically improved disability described in section
1905(v)(1) and whose assets, resources, and earned or
unearned income (or both) do not exceed such
limitations (if any) as the State may establish, but
only if the State provides medical assistance to
individuals described in subclause (XV);''.
(B) Definition of employed individuals with a medically
improved disability.--Section 1905 of the Social Security Act
(42 U.S.C. 1396d) is amended by adding at the end the following
new subsection:
``(v)(1) The term `employed individual with a medically improved
disability' means an individual who--
``(A) is at least 16, but less than 65, years of age;
``(B) is employed (as defined in paragraph (2));
``(C) ceases to be eligible for medical assistance under
section 1902(a)(10)(A)(ii)(XV) because the individual, by reason of
medical improvement, is determined at the time of a regularly
scheduled continuing disability review to no longer be eligible for
benefits under section 223(d) or 1614(a)(3); and
``(D) continues to have a severe medically determinable
impairment, as determined under regulations of the Secretary.
``(2) For purposes of paragraph (1), an individual is considered to
be `employed' if the individual--
``(A) is earning at least the applicable minimum wage
requirement under section 6 of the Fair Labor Standards Act (29
U.S.C. 206) and working at least 40 hours per month; or
``(B) is engaged in a work effort that meets substantial and
reasonable threshold criteria for hours of work, wages, or other
measures, as defined by the State and approved by the Secretary.''.
(C) Conforming amendment.--Section 1905(a) of such Act (42
U.S.C. 1396d(a)) is amended in the matter preceding paragraph
(1)--
(i) in clause (x), by striking ``or'' at the end;
(ii) in clause (xi), by adding ``or'' at the end; and
(iii) by inserting after clause (xi), the following new
clause:
``(xii) employed individuals with a medically improved
disability (as defined in subsection (v)),''.
(3) State authority to impose income-related premiums and cost-
sharing.--Section 1916 of such Act (42 U.S.C. 1396o) is amended--
(A) in subsection (a), by striking ``The State plan'' and
inserting ``Subject to subsection (g), the State plan''; and
(B) by adding at the end the following new subsection:
``(g) With respect to individuals provided medical assistance only
under subclause (XV) or (XVI) of section 1902(a)(10)(A)(ii)--
``(1) a State may (in a uniform manner for individuals
described in either such subclause)--
``(A) require such individuals to pay premiums or other
cost-sharing charges set on a sliding scale based on income
that the State may determine; and
``(B) require payment of 100 percent of such premiums for
such year in the case of such an individual who has income for
a year that exceeds 250 percent of the income official poverty
line (referred to in subsection (c)(1)) applicable to a family
of the size involved, except that in the case of such an
individual who has income for a year that does not exceed 450
percent of such poverty line, such requirement may only apply
to the extent such premiums do not exceed 7.5 percent of such
income; and
``(2) such State shall require payment of 100 percent of such
premiums for a year by such an individual whose adjusted gross
income (as defined in section 62 of the Internal Revenue Code of
1986) for such year exceeds $75,000, except that a State may choose
to subsidize such premiums by using State funds which may not be
federally matched under this title.
In the case of any calendar year beginning after 2000, the dollar
amount specified in paragraph (2) shall be increased in accordance with
the provisions of section 215(i)(2)(A)(ii).''.
(4) Prohibition against supplantation of state funds and state
failure to maintain effort.--Section 1903(i) of such Act (42 U.S.C.
1396b(i)) is amended--
(A) by striking the period at the end of paragraph (19) and
inserting ``; or''; and
(B) by inserting after such paragraph the following new
paragraph:
``(20) with respect to amounts expended for medical assistance
provided to an individual described in subclause (XV) or (XVI) of
section 1902(a)(10)(A)(ii) for a fiscal year unless the State
demonstrates to the satisfaction of the Secretary that the level of
State funds expended for such fiscal year for programs to enable
working individuals with disabilities to work (other than for such
medical assistance) is not less than the level expended for such
programs during the most recent State fiscal year ending before the
date of the enactment of this paragraph.''.
(b) Conforming Amendments.--Section 1903(f)(4) of the Social
Security Act (42 U.S.C. 1396b(f)(4) is amended in the matter preceding
subparagraph (A) by inserting ``1902(a)(10)(A)(ii)(XV),
1902(a)(10)(A)(ii)(XVI),'' before ``1905(p)(1)''.
(c) GAO Report.--Not later than 3 years after the date of the
enactment of this Act, the Comptroller General of the United States
shall submit a report to the Congress regarding the amendments made by
this section that examines--
(1) the extent to which higher health care costs for
individuals with disabilities at higher income levels deter
employment or progress in employment;
(2) whether such individuals have health insurance coverage or
could benefit from the State option established under such
amendments to provide a medicaid buy-in; and
(3) how the States are exercising such option, including--
(A) how such States are exercising the flexibility afforded
them with regard to income disregards;
(B) what income and premium levels have been set;
(C) the degree to which States are subsidizing premiums
above the dollar amount specified in section 1916(g)(2) of the
Social Security Act (42 U.S.C. 1396o(g)(2)); and
(D) the extent to which there exists any crowd-out effect.
(d) Effective Date.--The amendments made by this section apply to
medical assistance for items and services furnished on or after October
1, 2000.

018f64636d05d0dbef44b5aceb355fd46a04c00a019e8c6ff2c6a37e28c801b8

RECIPIENTS.
(a) In General.--The next to last sentence of section 226(b) of the
Social Security Act (42 U.S.C. 426) is amended by striking ``24'' and
inserting ``78''.
(b) Effective Date.--The amendment made by subsection (a) shall be
effective on and after October 1, 2000.
(c) GAO Report.--Not later than 5 years after the date of the
enactment of this Act, the Comptroller General of the United States
shall submit a report to the Congress that--
(1) examines the effectiveness and cost of the amendment made
by subsection (a);
(2) examines the necessity and effectiveness of providing
continuation of medicare coverage under section 226(b) of the
Social Security Act (42 U.S.C. 426(b)) to individuals whose annual
income exceeds the contribution and benefit base (as determined
under section 230 of such Act (42 U.S.C. 430));
(3) examines the viability of providing the continuation of
medicare coverage under such section 226(b) based on a sliding
scale premium for individuals whose annual income exceeds such
contribution and benefit base;
(4) examines the viability of providing the continuation of
medicare coverage under such section 226(b) based on a premium buy-
in by the beneficiary's employer in lieu of coverage under private
health insurance;
(5) examines the interrelation between the use of the
continuation of medicare coverage under such section 226(b) and the
use of private health insurance coverage by individuals during the
extended period; and
(6) recommends such legislative or administrative changes
relating to the continuation of medicare coverage for recipients of
social security disability benefits as the Comptroller General
determines are appropriate.

1377fa92053ad1117194c255dba923d6ab7cb7e18577ebf5c0b75f1c5cb1127f

SUPPORT WORKING INDIVIDUALS WITH DISABILITIES.
(a) Establishment.--
(1) In general.--The Secretary of Health and Human Services (in
this section referred to as the ``Secretary'') shall award grants
described in subsection (b) to States to support the design,
establishment, and operation of State infrastructures that provide
items and services to support working individuals with
disabilities.
(2) Application.--In order to be eligible for an award of a
grant under this section, a State shall submit an application to
the Secretary at such time, in such manner, and containing such
information as the Secretary shall require.
(3) Definition of state.--In this section, the term ``State''
means each of the 50 States, the District of Columbia, Puerto Rico,
Guam, the United States Virgin Islands, American Samoa, and the
Commonwealth of the Northern Mariana Islands.
(b) Grants for Infrastructure and Outreach.--
(1) In general.--Out of the funds appropriated under subsection
(e), the Secretary shall award grants to States to--
(A) support the establishment, implementation, and
operation of the State infrastructures described in subsection
(a); and
(B) conduct outreach campaigns regarding the existence of
such infrastructures.
(2) Eligibility for grants.--
(A) In general.--No State may receive a grant under this
subsection unless the State demonstrates to the satisfaction of
the Secretary that the State makes personal assistance services
available under the State plan under title XIX of the Social
Security Act (42 U.S.C. 1396 et seq.) to the extent necessary
to enable individuals with disabilities to remain employed,
including individuals described in section
1902(a)(10)(A)(ii)(XIII) of such Act (42 U.S.C.
1396a(a)(10)(A)(ii)(XIII)) if the State has elected to provide
medical assistance under such plan to such individuals.
(B) Definitions.--In this section:
(i) Employed.--The term ``employed'' means--
(I) earning at least the applicable minimum wage
requirement under section 6 of the Fair Labor Standards
Act (29 U.S.C. 206) and working at least 40 hours per
month; or
(II) being engaged in a work effort that meets
substantial and reasonable threshold criteria for hours
of work, wages, or other measures, as defined and
approved by the Secretary.
(ii) Personal assistance services.--The term ``personal
assistance services'' means a range of services, provided
by 1 or more persons, designed to assist an individual with
a disability to perform daily activities on and off the job
that the individual would typically perform if the
individual did not have a disability. Such services shall
be designed to increase the individual's control in life
and ability to perform everyday activities on or off the
job.
(3) Determination of awards.--
(A) In general.--Subject to subparagraph (B), the Secretary
shall develop a methodology for awarding grants to States under
this section for a fiscal year in a manner that--
(i) rewards States for their efforts in encouraging
individuals described in paragraph (2)(A) to be employed;
and
(ii) does not provide a State that has not elected to
provide medical assistance under title XIX of the Social
Security Act to individuals described in section
1902(a)(10)(A)(ii)(XIII) of that Act (42 U.S.C.
1396a(a)(10)(A)(ii)(XIII)) with proportionally more funds
for a fiscal year than a State that has exercised such
election.
(B) Award limits.--
(i) Minimum awards.--
(I) In general.--Subject to subclause (II), no
State with an approved application under this section
shall receive a grant for a fiscal year that is less
than $500,000.
(II) Pro rata reductions.--If the funds
appropriated under subsection (e) for a fiscal year are
not sufficient to pay each State with an application
approved under this section the minimum amount
described in subclause (I), the Secretary shall pay
each such State an amount equal to the pro rata share
of the amount made available.
(ii) Maximum awards.--
(I) States that elected optional medicaid
eligibility.--No State that has an application that has
been approved under this section and that has elected
to provide medical assistance under title XIX of the
Social Security Act to individuals described in section
1902(a)(10)(A)(ii)(XIII) of such Act (42 U.S.C.
1396a(a)(10)(A)(ii)(XIII)) shall receive a grant for a
fiscal year that exceeds 10 percent of the total
expenditures by the State (including the reimbursed
Federal share of such expenditures) for medical
assistance provided under such title for such
individuals, as estimated by the State and approved by
the Secretary.
(II) Other states.--The Secretary shall determine,
consistent with the limit described in subclause (I), a
maximum award limit for a grant for a fiscal year for a
State that has an application that has been approved
under this section but that has not elected to provide
medical assistance under title XIX of the Social
Security Act to individuals described in section
1902(a)(10)(A)(ii)(XIII) of that Act (42 U.S.C.
1396a(a)(10)(A)(ii)(XIII)).
(c) Availability of Funds.--
(1) Funds awarded to states.--Funds awarded to a State under a
grant made under this section for a fiscal year shall remain
available until expended.
(2) Funds not awarded to states.--Funds not awarded to States
in the fiscal year for which they are appropriated shall remain
available in succeeding fiscal years for awarding by the Secretary.
(d) Annual Report.--A State that is awarded a grant under this
section shall submit an annual report to the Secretary on the use of
funds provided under the grant. Each report shall include the
percentage increase in the number of title II disability beneficiaries,
as defined in section 1148(k)(3) of the Social Security Act (as added
by section 101(a) of this Act) in the State, and title XVI disability
beneficiaries, as defined in section 1148(k)(4) of the Social Security
Act (as so added) in the State who return to work.
(e) Appropriation.--
(1) In general.--Out of any funds in the Treasury not otherwise
appropriated, there is appropriated to make grants under this
section--
(A) for fiscal year 2001, $20,000,000;
(B) for fiscal year 2002, $25,000,000;
(C) for fiscal year 2003, $30,000,000;
(D) for fiscal year 2004, $35,000,000;
(E) for fiscal year 2005, $40,000,000; and
(F) for each of fiscal years 2006 through 2011, the amount
appropriated for the preceding fiscal year increased by the
percentage increase (if any) in the Consumer Price Index for
All Urban Consumers (United States city average) for the
preceding fiscal year.
(2) Budget authority.--This subsection constitutes budget
authority in advance of appropriations Acts and represents the
obligation of the Federal Government to provide for the payment of
the amounts appropriated under paragraph (1).
(f) Recommendation.--Not later than October 1, 2010, the Secretary,
in consultation with the Ticket to Work and Work Incentives Advisory
Panel established by section 101(f) of this Act, shall submit a
recommendation to the Committee on Commerce of the House of
Representatives and the Committee on Finance of the Senate regarding
whether the grant program established under this section should be
continued after fiscal year 2011.

75836f2ed28a7dae7ec11eee17468356a7013e789e8081c40d4154b08d6799dd

WORKERS WITH POTENTIALLY SEVERE DISABILITIES.
(a) State Application.--A State may apply to the Secretary of
Health and Human Services (in this section referred to as the
``Secretary'') for approval of a demonstration project (in this section
referred to as a ``demonstration project'') under which up to a
specified maximum number of individuals who are workers with a
potentially severe disability (as defined in subsection (b)(1)) are
provided medical assistance equal to--
(1) that provided under section 1905(a) of the Social Security
Act (42 U.S.C. 1396d(a)) to individuals described in section
1902(a)(10)(A)(ii)(XIII) of that Act (42 U.S.C.
1396a(a)(10)(A)(ii)(XIII)); or
(2) in the case of a State that has not elected to provide
medical assistance under that section to such individuals, such
medical assistance as the Secretary determines is an appropriate
equivalent to the medical assistance described in paragraph (1).
(b) Worker With a Potentially Severe Disability Defined.--For
purposes of this section--
(1) In general.--The term ``worker with a potentially severe
disability'' means, with respect to a demonstration project, an
individual who--
(A) is at least 16, but less than 65, years of age;
(B) has a specific physical or mental impairment that, as
defined by the State under the demonstration project, is
reasonably expected, but for the receipt of items and services
described in section 1905(a) of the Social Security Act (42
U.S.C. 1396d(a)), to become blind or disabled (as defined under
section 1614(a) of the Social Security Act (42 U.S.C.
1382c(a))); and
(C) is employed (as defined in paragraph (2)).
(2) Definition of employed.--An individual is considered to be
``employed'' if the individual--
(A) is earning at least the applicable minimum wage
requirement under section 6 of the Fair Labor Standards Act (29
U.S.C. 206) and working at least 40 hours per month; or
(B) is engaged in a work effort that meets substantial and
reasonable threshold criteria for hours of work, wages, or
other measures, as defined under the demonstration project and
approved by the Secretary.
(c) Approval of Demonstration Projects.--
(1) In general.--Subject to paragraph (3), the Secretary shall
approve applications under subsection (a) that meet the
requirements of paragraph (2) and such additional terms and
conditions as the Secretary may require. The Secretary may waive
the requirement of section 1902(a)(1) of the Social Security Act
(42 U.S.C. 1396a(a)(1)) to allow for sub-State demonstrations.
(2) Terms and conditions of demonstration projects.--The
Secretary may not approve a demonstration project under this
section unless the State provides assurances satisfactory to the
Secretary that the following conditions are or will be met:
(A) Maintenance of state effort.--Federal funds paid to a
State pursuant to this section must be used to supplement, but
not supplant, the level of State funds expended for workers
with potentially severe disabilities under programs in effect
for such individuals at the time the demonstration project is
approved under this section.
(B) Independent evaluation.--The State provides for an
independent evaluation of the project.
(3) Limitations on federal funding.--
(A) Appropriation.--
(i) In general.--Out of any funds in the Treasury not
otherwise appropriated, there is appropriated to carry out
this section--
(I) $42,000,000 for each of fiscal years 2001
through 2004; and
(II) $41,000,000 for each of fiscal years 2005 and
2006.
(ii) Budget authority.--Clause (i) constitutes budget
authority in advance of appropriations Acts and represents
the obligation of the Federal Government to provide for the
payment of the amounts appropriated under clause (i).
(B) Limitation on payments.--In no case may--
(i) the aggregate amount of payments made by the
Secretary to States under this section exceed $250,000,000;
(ii) the aggregate amount of payments made by the
Secretary to States for administrative expenses relating to
annual reports required under subsection (d) exceed
$2,000,000 of such $250,000,000; or
(iii) payments be provided by the Secretary for a
fiscal year after fiscal year 2009.
(C) Funds allocated to states.--The Secretary shall
allocate funds to States based on their applications and the
availability of funds. Funds allocated to a State under a grant
made under this section for a fiscal year shall remain
available until expended.
(D) Funds not allocated to states.--Funds not allocated to
States in the fiscal year for which they are appropriated shall
remain available in succeeding fiscal years for allocation by
the Secretary using the allocation formula established under
this section.
(E) Payments to states.--The Secretary shall pay to each
State with a demonstration project approved under this section,
from its allocation under subparagraph (C), an amount for each
quarter equal to the Federal medical assistance percentage (as
defined in section 1905(b) of the Social Security Act (42
U.S.C. 1395d(b)) of expenditures in the quarter for medical
assistance provided to workers with a potentially severe
disability.
(d) Annual Report.--A State with a demonstration project approved
under this section shall submit an annual report to the Secretary on
the use of funds provided under the grant. Each report shall include
enrollment and financial statistics on--
(1) the total population of workers with potentially severe
disabilities served by the demonstration project; and
(2) each population of such workers with a specific physical or
mental impairment described in subsection (b)(1)(B) served by such
project.
(e) Recommendation.--Not later than October 1, 2004, the Secretary
shall submit a recommendation to the Committee on Commerce of the House
of Representatives and the Committee on Finance of the Senate regarding
whether the demonstration project established under this section should
be continued after fiscal year 2006.
(f) State Defined.--In this section, the term ``State'' has the
meaning given such term for purposes of title XIX of the Social
Security Act (42 U.S.C. 1396 et seq.).

34551d27162baa662696cae5d96970851c62b25a5678a0c837a363722b0f40fb

INSURANCE WHEN COVERED UNDER A GROUP HEALTH PLAN.
(a) In General.--Section 1882(q) of the Social Security Act (42
U.S.C. 1395ss(q)) is amended--
(1) in paragraph (5)(C), by inserting ``or paragraph (6)''
after ``this paragraph''; and
(2) by adding at the end the following new paragraph:
``(6) Each medicare supplemental policy shall provide that
benefits and premiums under the policy shall be suspended at the
request of the policyholder if the policyholder is entitled to
benefits under section 226(b) and is covered under a group health
plan (as defined in section 1862(b)(1)(A)(v)). If such suspension
occurs and if the policyholder or certificate holder loses coverage
under the group health plan, such policy shall be automatically
reinstituted (effective as of the date of such loss of coverage)
under terms described in subsection (n)(6)(A)(ii) as of the loss of
such coverage if the policyholder provides notice of loss of such
coverage within 90 days after the date of such loss.''.
(b) Effective Date.--The amendments made by subsection (a) apply
with respect to requests made after the date of the enactment of this
Act.

1578b220ee8d552ec0c39e01febfcbde16656c61ac0c8c46d6a912bf5cfa9e69

PROJECT AUTHORITY.
(a) Extension of Authority.--Title II of the Social Security Act
(42 U.S.C. 401 et seq.) is amended by adding at the end the following
new section:
``DEMONSTRATION PROJECT AUTHORITY
``Sec. 234. (a) Authority.--
``(1) In general.--The Commissioner of Social Security (in this
section referred to as the `Commissioner') shall develop and carry
out experiments and demonstration projects designed to determine
the relative advantages and disadvantages of--
``(A) various alternative methods of treating the work
activity of individuals entitled to disability insurance
benefits under section 223 or to monthly insurance benefits
under section 202 based on such individual's disability (as
defined in section 223(d)), including such methods as a
reduction in benefits based on earnings, designed to encourage
the return to work of such individuals;
``(B) altering other limitations and conditions applicable
to such individuals (including lengthening the trial work
period (as defined in section 222(c)), altering the 24-month
waiting period for hospital insurance benefits under section
226, altering the manner in which the program under this title
is administered, earlier referral of such individuals for
rehabilitation, and greater use of employers and others to
develop, perform, and otherwise stimulate new forms of
rehabilitation); and
``(C) implementing sliding scale benefit offsets using
variations in--
``(i) the amount of the offset as a proportion of
earned income;
``(ii) the duration of the offset period; and
``(iii) the method of determining the amount of income
earned by such individuals,
to the end that savings will accrue to the Trust Funds, or to
otherwise promote the objectives or facilitate the administration
of this title.
``(2) Authority for expansion of scope.--The Commissioner may
expand the scope of any such experiment or demonstration project to
include any group of applicants for benefits under the program
established under this title with impairments that reasonably may
be presumed to be disabling for purposes of such demonstration
project, and may limit any such demonstration project to any such
group of applicants, subject to the terms of such demonstration
project which shall define the extent of any such presumption.
``(b) Requirements.--The experiments and demonstration projects
developed under subsection (a) shall be of sufficient scope and shall
be carried out on a wide enough scale to permit a thorough evaluation
of the alternative methods under consideration while giving assurance
that the results derived from the experiments and projects will obtain
generally in the operation of the disability insurance program under
this title without committing such program to the adoption of any
particular system either locally or nationally.
``(c) Authority To Waive Compliance With Benefits Requirements.--In
the case of any experiment or demonstration project conducted under
subsection (a), the Commissioner may waive compliance with the benefit
requirements of this title and the requirements of section 1148 as they
relate to the program established under this title, and the Secretary
may (upon the request of the Commissioner) waive compliance with the
benefits requirements of title XVIII, insofar as is necessary for a
thorough evaluation of the alternative methods under consideration. No
such experiment or project shall be actually placed in operation unless
at least 90 days prior thereto a written report, prepared for purposes
of notification and information only and containing a full and complete
description thereof, has been transmitted by the Commissioner to the
Committee on Ways and Means of the House of Representatives and to the
Committee on Finance of the Senate. Periodic reports on the progress of
such experiments and demonstration projects shall be submitted by the
Commissioner to such committees. When appropriate, such reports shall
include detailed recommendations for changes in administration or law,
or both, to carry out the objectives stated in subsection (a).
``(d) Reports.--
``(1) Interim reports.--On or before June 9 of each year, the
Commissioner shall submit to the Committee on Ways and Means of the
House of Representatives and to the Committee on Finance of the
Senate an annual interim report on the progress of the experiments
and demonstration projects carried out under this subsection
together with any related data and materials that the Commissioner
may consider appropriate.
``(2) Termination and final report.--The authority under the
preceding provisions of this section (including any waiver granted
pursuant to subsection (c)) shall terminate 5 years after the date
of the enactment of this Act. Not later than 90 days after the
termination of any experiment or demonstration project carried out
under this section, the Commissioner shall submit to the Committee
on Ways and Means of the House of Representatives and to the
Committee on Finance of the Senate a final report with respect to
that experiment or demonstration project.''.
(b) Conforming Amendments; Transfer of Prior Authority.--
(1) Conforming amendments.--
(A) Repeal of prior authority.--Paragraphs (1) through (4)
of subsection (a) and subsection (c) of section 505 of the
Social Security Disability Amendments of 1980 (42 U.S.C. 1310
note) are repealed.
(B) Conforming amendment regarding funding.--Section 201(k)
of the Social Security Act (42 U.S.C. 401(k)) is amended by
striking ``section 505(a) of the Social Security Disability
Amendments of 1980'' and inserting ``section 234''.
(2) Transfer of prior authority.--With respect to any
experiment or demonstration project being conducted under section
505(a) of the Social Security Disability Amendments of 1980 (42
U.S.C. 1310 note) as of the date of the enactment of this Act, the
authority to conduct such experiment or demonstration project
(including the terms and conditions applicable to the experiment or
demonstration project) shall be treated as if that authority (and
such terms and conditions) had been established under section 234
of the Social Security Act, as added by subsection (a).

4d7b910b860baef2ac2280f87e61367709d4f2098b21b22ed4f865061abde174

INSURANCE BENEFITS BASED ON EARNINGS.
(a) Authority.--The Commissioner of Social Security shall conduct
demonstration projects for the purpose of evaluating, through the
collection of data, a program for title II disability beneficiaries (as
defined in section 1148(k)(3) of the Social Security Act) under which
benefits payable under section 223 of such Act, or under section 202 of
such Act based on the beneficiary's disability, are reduced by $1 for
each $2 of the beneficiary's earnings that is above a level to be
determined by the Commissioner. Such projects shall be conducted at a
number of localities which the Commissioner shall determine is
sufficient to adequately evaluate the appropriateness of national
implementation of such a program. Such projects shall identify
reductions in Federal expenditures that may result from the permanent
implementation of such a program.
(b) Scope and Scale and Matters To Be Determined.--
(1) In general.--The demonstration projects developed under
subsection (a) shall be of sufficient duration, shall be of
sufficient scope, and shall be carried out on a wide enough scale
to permit a thorough evaluation of the project to determine--
(A) the effects, if any, of induced entry into the project
and reduced exit from the project;
(B) the extent, if any, to which the project being tested
is affected by whether it is in operation in a locality within
an area under the administration of the Ticket to Work and
Self-Sufficiency Program established under section 1148 of the
Social Security Act; and
(C) the savings that accrue to the Federal Old-Age and
Survivors Insurance Trust Fund, the Federal Disability
Insurance Trust Fund, and other Federal programs under the
project being tested.
The Commissioner shall take into account advice provided by the
Ticket to Work and Work Incentives Advisory Panel pursuant to
section 101(f)(2)(B)(ii) of this Act.
(2) Additional matters.--The Commissioner shall also determine
with respect to each project--
(A) the annual cost (including net cost) of the project and
the annual cost (including net cost) that would have been
incurred in the absence of the project;
(B) the determinants of return to work, including the
characteristics of the beneficiaries who participate in the
project; and
(C) the employment outcomes, including wages, occupations,
benefits, and hours worked, of beneficiaries who return to work
as a result of participation in the project.
The Commissioner may include within the matters evaluated under the
project the merits of trial work periods and periods of extended
eligibility.
(c) Waivers.--The Commissioner may waive compliance with the
benefit provisions of title II of the Social Security Act (42 U.S.C.
401 et seq.), and the Secretary of Health and Human Services may waive
compliance with the benefit requirements of title XVIII of such Act (42
U.S.C. 1395 et seq.), insofar as is necessary for a thorough evaluation
of the alternative methods under consideration. No such project shall
be actually placed in operation unless at least 90 days prior thereto a
written report, prepared for purposes of notification and information
only and containing a full and complete description thereof, has been
transmitted by the Commissioner to the Committee on Ways and Means of
the House of Representatives and to the Committee on Finance of the
Senate. Periodic reports on the progress of such projects shall be
submitted by the Commissioner to such committees. When appropriate,
such reports shall include detailed recommendations for changes in
administration or law, or both, to carry out the objectives stated in
subsection (a).
(d) Interim Reports.--Not later than 2 years after the date of the
enactment of this Act, and annually thereafter, the Commissioner of
Social Security shall submit to the Congress an interim report on the
progress of the demonstration projects carried out under this
subsection together with any related data and materials that the
Commissioner of Social Security may consider appropriate.
(e) Final Report.--The Commissioner of Social Security shall submit
to the Congress a final report with respect to all demonstration
projects carried out under this section not later than 1 year after
their completion.
(f) Expenditures.--Expenditures made for demonstration projects
under this section shall be made from the Federal Disability Insurance
Trust Fund and the Federal Old-Age and Survivors Insurance Trust Fund,
as determined appropriate by the Commissioner of Social Security, and
from the Federal Hospital Insurance Trust Fund and the Federal
Supplementary Medical Insurance Trust Fund, as determined appropriate
by the Secretary of Health and Human Services, to the extent provided
in advance in appropriation Acts.

20350c2881d3f63193fe9f6ebbc19af1d1fad04624498e1a3f208047f2e4945d

(a) Study by General Accounting Office of Existing
Disability-Related Employment Incentives.--
(1) Study.--As soon as practicable after the date of the
enactment of this Act, the Comptroller General of the United States
shall undertake a study to assess existing tax credits and other
disability-related employment incentives under the Americans with
Disabilities Act of 1990 (42 U.S.C. 12101 et seq.) and other
Federal laws. In such study, the Comptroller General shall
specifically address the extent to which such credits and other
incentives would encourage employers to hire and retain individuals
with disabilities.
(2) Report.--Not later than 3 years after the date of the
enactment of this Act, the Comptroller General shall transmit to
the Committee on Ways and Means of the House of Representatives and
the Committee on Finance of the Senate a written report presenting
the results of the Comptroller General's study conducted pursuant
to this subsection, together with such recommendations for
legislative or administrative changes as the Comptroller General
determines are appropriate.
(b) Study by General Accounting Office of Existing Coordination of
the DI and SSI Programs as They Relate to Individuals Entering or
Leaving Concurrent Entitlement.--
(1) Study.--As soon as practicable after the date of the
enactment of this Act, the Comptroller General of the United States
shall undertake a study to evaluate the coordination under current
law of the disability insurance program under title II of the
Social Security Act (42 U.S.C. 401 et seq.) and the supplemental
security income program under title XVI of such Act (42 U.S.C. 1381
et seq.), as such programs relate to individuals entering or
leaving concurrent entitlement under such programs. In such study,
the Comptroller General shall specifically address the
effectiveness of work incentives under such programs with respect
to such individuals and the effectiveness of coverage of such
individuals under titles XVIII and XIX of such Act (42 U.S.C. 1395
et seq., 1396 et seq.).
(2) Report.--Not later than 3 years after the date of the
enactment of this Act, the Comptroller General shall transmit to
the Committee on Ways and Means of the House of Representatives and
the Committee on Finance of the Senate a written report presenting
the results of the Comptroller General's study conducted pursuant
to this subsection, together with such recommendations for
legislative or administrative changes as the Comptroller General
determines are appropriate.
(c) Study by General Accounting Office of the Impact of the
Substantial Gainful Activity Limit on Return to Work.--
(1) Study.--As soon as practicable after the date of the
enactment of this Act, the Comptroller General of the United States
shall undertake a study of the substantial gainful activity level
applicable as of that date to recipients of benefits under section
223 of the Social Security Act (42 U.S.C. 423) and under section
202 of such Act (42 U.S.C. 402) on the basis of a recipient having
a disability, and the effect of such level as a disincentive for
those recipients to return to work. In the study, the Comptroller
General also shall address the merits of increasing the substantial
gainful activity level applicable to such recipients of benefits
and the rationale for not yearly indexing that level to inflation.
(2) Report.--Not later than 2 years after the date of the
enactment of this Act, the Comptroller General shall transmit to
the Committee on Ways and Means of the House of Representatives and
the Committee on Finance of the Senate a written report presenting
the results of the Comptroller General's study conducted pursuant
to this subsection, together with such recommendations for
legislative or administrative changes as the Comptroller General
determines are appropriate.
(d) Report on Disregards Under the DI and SSI Programs.--Not later
than 90 days after the date of the enactment of this Act, the
Commissioner of Social Security shall submit to the Committee on Ways
and Means of the House of Representatives and the Committee on Finance
of the Senate a report that--
(1) identifies all income, assets, and resource disregards
(imposed under statutory or regulatory authority) that are
applicable to individuals receiving benefits under title II or XVI
of the Social Security Act (42 U.S.C. 401 et seq., 1381 et seq.);
(2) with respect to each such disregard--
(A) specifies the most recent statutory or regulatory
modification of the disregard; and
(B) recommends whether further statutory or regulatory
modification of the disregard would be appropriate; and
(3) with respect to the disregard described in section
1612(b)(7) of such Act (42 U.S.C. 1382a(b)(7)) (relating to grants,
scholarships, or fellowships received for use in paying the cost of
tuition and fees at any educational (including technical or
vocational education) institution)--
(A) identifies the number of individuals receiving benefits
under title XVI of such Act (42 U.S.C. 1381 et seq.) who have
attained age 22 and have not had any portion of any grant,
scholarship, or fellowship received for use in paying the cost
of tuition and fees at any educational (including technical or
vocational education) institution excluded from their income in
accordance with that section;
(B) recommends whether the age at which such grants,
scholarships, or fellowships are excluded from income for
purposes of determining eligibility under title XVI of such Act
(42 U.S.C. 1381 et seq.) should be increased to age 25; and
(C) recommends whether such disregard should be expanded to
include any such grant, scholarship, or fellowship received for
use in paying the cost of room and board at any such
institution.
(e) Study by the General Accounting Office of Social Security
Administration's Disability Insurance Program Demonstration
Authority.--
(1) Study.--As soon as practicable after the date of the
enactment of this Act, the Comptroller General of the United States
shall undertake a study to assess the results of the Social
Security Administration's efforts to conduct disability
demonstrations authorized under prior law as well as under section
234 of the Social Security Act (as added by section 301 of this
Act).
(2) Report.--Not later than 5 years after the date of the
enactment of this Act, the Comptroller General shall transmit to
the Committee on Ways and Means of the House of Representatives and
the Committee on Finance of the Senate a written report presenting
the results of the Comptroller General's study conducted pursuant
to this section, together with a recommendation as to whether the
demonstration authority authorized under section 234 of the Social
Security Act (as added by section 301 of this Act) should be made
permanent.

f8d69ba06e7e96486ab1820b4dfde1bfcaf7df3932b74c487175697209fac3e3

(a) Clarification Relating to the Effective Date of the Denial of
Social Security Disability Benefits to Drug Addicts and Alcoholics.--
Section 105(a)(5) of the Contract with America Advancement Act of 1996
(42 U.S.C. 405 note) is amended--
(1) in subparagraph (A), by striking ``by the Commissioner of
Social Security'' and ``by the Commissioner''; and
(2) by adding at the end the following new subparagraph:
``(D) For purposes of this paragraph, an individual's
claim, with respect to benefits under title II based on
disability, which has been denied in whole before the date of
the enactment of this Act, may not be considered to be finally
adjudicated before such date if, on or after such date--
``(i) there is pending a request for either
administrative or judicial review with respect to such
claim; or
``(ii) there is pending, with respect to such claim, a
readjudication by the Commissioner of Social Security
pursuant to relief in a class action or implementation by
the Commissioner of a court remand order.
``(E) Notwithstanding the provisions of this paragraph,
with respect to any individual for whom the Commissioner of
Social Security does not perform the entitlement
redetermination before the date prescribed in subparagraph (C),
the Commissioner shall perform such entitlement redetermination
in lieu of a continuing disability review whenever the
Commissioner determines that the individual's entitlement is
subject to redetermination based on the preceding provisions of
this paragraph, and the provisions of section 223(f) shall not
apply to such redetermination.''.
(b) Correction to Effective Date of Provisions Concerning
Representative Payees and Treatment Referrals of Social Security
Beneficiaries Who Are Drug Addicts and Alcoholics.--Section
105(a)(5)(B) of the Contract with America Advancement Act of 1996 (42
U.S.C. 405 note) is amended to read as follows:
``(B) The amendments made by paragraphs (2) and (3) shall
take effect on July 1, 1996, with respect to any individual--
``(i) whose claim for benefits is finally adjudicated
on or after the date of the enactment of this Act; or
``(ii) whose entitlement to benefits is based upon an
entitlement redetermination made pursuant to subparagraph
(C).''.
(c) Effective Dates.--The amendments made by this section shall
take effect as if included in the enactment of section 105 of the
Contract with America Advancement Act of 1996 (Public Law 104-121; 110
Stat. 852 et seq.).

fa98ca3fd8c171d3a9688cb1025215f603f26fcb0cb6bb915da06bfa53cce578

(a) Implementation of Prohibition Against Payment of Title II
Benefits to Prisoners.--
(1) In general.--Section 202(x)(3) of the Social Security Act
(42 U.S.C. 402(x)(3)) is amended--
(A) by inserting ``(A)'' after ``(3)''; and
(B) by adding at the end the following new subparagraph:
``(B)(i) The Commissioner shall enter into an agreement under this
subparagraph with any interested State or local institution comprising
a jail, prison, penal institution, or correctional facility, or
comprising any other institution a purpose of which is to confine
individuals as described in paragraph (1)(A)(ii). Under such
agreement--
``(I) the institution shall provide to the Commissioner, on a
monthly basis and in a manner specified by the Commissioner, the
names, Social Security account numbers, dates of birth, confinement
commencement dates, and, to the extent available to the
institution, such other identifying information concerning the
individuals confined in the institution as the Commissioner may
require for the purpose of carrying out paragraph (1) and other
provisions of this title; and
``(II) the Commissioner shall pay to the institution, with
respect to information described in subclause (I) concerning each
individual who is confined therein as described in paragraph
(1)(A), who receives a benefit under this title for the month
preceding the first month of such confinement, and whose benefit
under this title is determined by the Commissioner to be not
payable by reason of confinement based on the information provided
by the institution, $400 (subject to reduction under clause (ii))
if the institution furnishes the information to the Commissioner
within 30 days after the date such individual's confinement in such
institution begins, or $200 (subject to reduction under clause
(ii)) if the institution furnishes the information after 30 days
after such date but within 90 days after such date.
``(ii) The dollar amounts specified in clause (i)(II) shall be
reduced by 50 percent if the Commissioner is also required to make a
payment to the institution with respect to the same individual under an
agreement entered into under section 1611(e)(1)(I).
``(iii) There are authorized to be transferred from the Federal
Old-Age and Survivors Insurance Trust Fund and the Federal Disability
Insurance Trust Fund, as appropriate, such sums as may be necessary to
enable the Commissioner to make payments to institutions required by
clause (i)(II).
``(iv) The Commissioner shall maintain, and shall provide on a
reimbursable basis, information obtained pursuant to agreements entered
into under this paragraph to any agency administering a Federal or
federally-assisted cash, food, or medical assistance program for
eligibility and other administrative purposes under such program.''.
(2) Conforming amendments to the privacy act.--
Section 552a(a)(8)(B) of title 5, United States Code, is amended--
(A) in clause (vi), by striking ``or'' at the end;
(B) in clause (vii), by adding ``or'' at the end; and
(C) by adding at the end the following new clause:
``(viii) matches performed pursuant to section
202(x)(3) or 1611(e)(1) of the Social Security Act (42
U.S.C. 402(x)(3), 1382(e)(1));''.
(3) Conforming amendments to title xvi.--
(A) Section 1611(e)(1)(I)(i)(I) of the Social Security Act
(42 U.S.C. 1382(e)(1)(I)(i)(I)) is amended by striking ``;
and'' and inserting ``and the other provisions of this title;
and''.
(B) Section 1611(e)(1)(I)(ii)(II) of such Act (42 U.S.C.
1382(e)(1)(I)(ii)(II)) is amended by striking ``is authorized
to provide, on a reimbursable basis,'' and inserting ``shall
maintain, and shall provide on a reimbursable basis,''.
(4) Effective date.--The amendments made by this subsection
shall apply to individuals whose period of confinement in an
institution commences on or after the first day of the fourth month
beginning after the month in which this Act is enacted.
(b) Elimination of Title II Requirement That Confinement Stem From
Crime Punishable by Imprisonment for More Than 1 Year.--
(1) In general.--Section 202(x)(1)(A) of the Social Security
Act (42 U.S.C. 402(x)(1)(A)) is amended--
(A) in the matter preceding clause (i), by striking
``during which'' and inserting ``ending with or during or
beginning with or during a period of more than 30 days
throughout all of which'';
(B) in clause (i), by striking ``an offense punishable by
imprisonment for more than 1 year (regardless of the actual
sentence imposed)'' and inserting ``a criminal offense''; and
(C) in clause (ii)(I), by striking ``an offense punishable
by imprisonment for more than 1 year'' and inserting ``a
criminal offense''.
(2) Effective date.--The amendments made by this subsection
shall apply to individuals whose period of confinement in an
institution commences on or after the first day of the fourth month
beginning after the month in which this Act is enacted.
(c) Conforming Title XVI Amendments.--
(1) Fifty percent reduction in title xvi payment in case
involving comparable title ii payment.--Section 1611(e)(1)(I) of
the Social Security Act (42 U.S.C. 1382(e)(1)(I)) is amended--
(A) in clause (i)(II), by inserting ``(subject to reduction
under clause (ii))'' after ``$400'' and after ``$200'';
(B) by redesignating clauses (ii) and (iii) as clauses
(iii) and (iv) respectively; and
(C) by inserting after clause (i) the following new clause:
``(ii) The dollar amounts specified in clause (i)(II) shall be
reduced by 50 percent if the Commissioner is also required to make a
payment to the institution with respect to the same individual under an
agreement entered into under section 202(x)(3)(B).''.
(2) Expansion of categories of institutions eligible to enter
into agreements with the commissioner.--Section 1611(e)(1)(I)(i) of
such Act (42 U.S.C. 1382(e)(1)(I)(i)) is amended in the matter
preceding subclause (I) by striking ``institution'' and all that
follows through ``section 202(x)(1)(A),'' and inserting
``institution comprising a jail, prison, penal institution, or
correctional facility, or with any other interested State or local
institution a purpose of which is to confine individuals as
described in section 202(x)(1)(A)(ii),''.
(3) Elimination of overly broad exemption.--Section
1611(e)(1)(I)(iii) of such Act (42 U.S.C. 1382(e)(1)(I)(iii)) (as
redesignated by paragraph (1)(B)) is amended further--
(A) by striking ``(I) The provisions'' and all that follows
through ``(II)''; and
(B) by striking ``eligibility purposes'' and inserting
``eligibility and other administrative purposes under such
program''.
(4) Effective date.--The amendments made by this subsection
shall take effect as if included in the enactment of section 203(a)
of the Personal Responsibility and Work Opportunity Reconciliation
Act of 1996 (Public Law 104-193; 110 Stat. 2186). The reference to
section 202(x)(1)(A)(ii) of the Social Security Act in section
1611(e)(1)(I)(i) of the Social Security Act, as amended by
paragraph (2) of this subsection, shall be deemed a reference to
such section 202(x)(1)(A)(ii) of such Act as amended by subsection
(b)(1)(C) of this section.
(d) Continued Denial of Benefits to Sex Offenders Remaining
Confined to Public Institutions Upon Completion of Prison Term.--
(1) In general.--Section 202(x)(1)(A) of the Social Security
Act (42 U.S.C. 402(x)(1)(A)) is amended--
(A) in clause (i), by striking ``or'' at the end;
(B) in clause (ii)(IV), by striking the period and
inserting ``, or''; and
(C) by adding at the end the following new clause:
``(iii) immediately upon completion of confinement as described
in clause (i) pursuant to conviction of a criminal offense an
element of which is sexual activity, is confined by court order in
an institution at public expense pursuant to a finding that the
individual is a sexually dangerous person or a sexual predator or a
similar finding.''.
(2) Conforming amendment.--Section 202(x)(1)(B)(ii) of such Act
(42 U.S.C. 402(x)(1)(B)(ii)) is amended by striking ``clause (ii)''
and inserting ``clauses (ii) and (iii)''.
(3) Effective date.--The amendments made by this subsection
shall apply with respect to benefits for months ending after the
date of the enactment of this Act.

02d268a158cf04d827cc2e699eb74a75f27bb6f65ba40bbd2d9d11dacdf613fe

SECURITY COVERAGE.
(a) In General.--Notwithstanding section 1402(e)(4) of the Internal
Revenue Code of 1986, any exemption which has been received under
section 1402(e)(1) of such Code by a duly ordained, commissioned, or
licensed minister of a church, a member of a religious order, or a
Christian Science practitioner, and which is effective for the taxable
year in which this Act is enacted, may be revoked by filing an
application therefor (in such form and manner, and with such official,
as may be prescribed by the Commissioner of Internal Revenue), if such
application is filed no later than the due date of the Federal income
tax return (including any extension thereof) for the applicant's second
taxable year beginning after December 31, 1999. Any such revocation
shall be effective (for purposes of chapter 2 of the Internal Revenue
Code of 1986 and title II of the Social Security Act (42 U.S.C. 401 et
seq.)), as specified in the application, either with respect to the
applicant's first taxable year beginning after December 31, 1999, or
with respect to the applicant's second taxable year beginning after
such date, and for all succeeding taxable years; and the applicant for
any such revocation may not thereafter again file application for an
exemption under such section 1402(e)(1). If the application is filed
after the due date of the applicant's Federal income tax return for a
taxable year and is effective with respect to that taxable year, it
shall include or be accompanied by payment in full of an amount equal
to the total of the taxes that would have been imposed by section 1401
of the Internal Revenue Code of 1986 with respect to all of the
applicant's income derived in that taxable year which would have
constituted net earnings from self-employment for purposes of chapter 2
of such Code (notwithstanding paragraphs (4) and (5) of section
1402(c)) except for the exemption under section 1402(e)(1) of such
Code.
(b) Effective Date.--Subsection (a) shall apply with respect to
service performed (to the extent specified in such subsection) in
taxable years beginning after December 31, 1999, and with respect to
monthly insurance benefits payable under title II on the basis of the
wages and self-employment income of any individual for months in or
after the calendar year in which such individual's application for
revocation (as described in such subsection) is effective (and lump-sum
death payments payable under such title on the basis of such wages and
self-employment income in the case of deaths occurring in or after such
calendar year).

6ed6e79829d46680ff42a40dc3da4dde28124fd54c4422a71eda6b8a6f2f87bf

RESEARCH OR DEMONSTRATION PROJECTS UNDER TITLES II AND
XVI.
(a) In General.--Section 1110(a)(3) of the Social Security Act (42
U.S.C. 1310(a)(3)) is amended by striking ``title XVI'' and inserting
``title II or XVI''.
(b) Effective Date.--The amendment made by subsection (a) shall
take effect as if included in the enactment of the Social Security
Independence and Program Improvements Act of 1994 (Public Law 103-296;
108 Stat. 1464).

6779f88b7f118e93e523dd3626561d36084067376aa2ffa9dd068ed02c3cd1a3

(a) In General.--Section 1137(a)(3) of the Social Security Act (42
U.S.C. 1320b-7(a)(3)) is amended by inserting before the semicolon the
following: ``, and except that in the case of wage reports with respect
to domestic service employment, a State may permit employers (as so
defined) that make returns with respect to such employment on a
calendar year basis pursuant to section 3510 of the Internal Revenue
Code of 1986 to make such reports on an annual basis''.
(b) Technical Amendments.--Section 1137(a)(3) of the Social
Security Act (42 U.S.C. 1320b-7(a)(3)) is amended--
(1) by striking ``(as defined in section 453A(a)(2)(B)(iii))'';
and
(2) by inserting ``(as defined in section 453A(a)(2)(B))''
after ``employers'' .
(c) Effective Date.--The amendments made by this section shall
apply to wage reports required to be submitted on and after the date of
the enactment of this Act.

b1c10c580ddf1cabc26c8c2110cfb0855211be868fba36939e3dc39a589e40e2

SECURITY ADMINISTRATION.
(a) Assessment on Attorneys.--
(1) In General.--Section 206 of the Social Security Act (42
U.S.C. 406) is amended by adding at the end the following new
subsection:
``(d) Assessment on Attorneys.--
``(1) In general.--Whenever a fee for services is required to
be certified for payment to an attorney from a claimant's past-due
benefits pursuant to subsection (a)(4) or (b)(1), the Commissioner
shall impose on the attorney an assessment calculated in accordance
with paragraph (2).
``(2) Amount.--
``(A) The amount of an assessment under paragraph (1) shall
be equal to the product obtained by multiplying the amount of
the representative's fee that would be required to be so
certified by subsection (a)(4) or (b)(1) before the application
of this subsection, by the percentage specified in subparagraph
(B).
``(B) The percentage specified in this subparagraph is--
``(i) for calendar years before 2001, 6.3 percent, and
``(ii) for calendar years after 2000, such percentage
rate as the Commissioner determines is necessary in order
to achieve full recovery of the costs of determining and
certifying fees to attorneys from the past-due benefits of
claimants, but not in excess of 6.3 percent.
``(3) Collection.--The Commissioner may collect the assessment
imposed on an attorney under paragraph (1) by offset from the
amount of the fee otherwise required by subsection (a)(4) or (b)(1)
to be certified for payment to the attorney from a claimant's past-
due benefits.
``(4) Prohibition on claimant reimbursement.--An attorney
subject to an assessment under paragraph (1) may not, directly or
indirectly, request or otherwise obtain reimbursement for such
assessment from the claimant whose claim gave rise to the
assessment.
``(5) Disposition of assessments.--Assessments on attorneys
collected under this subsection shall be credited to the Federal
Old-Age and Survivors Insurance Trust Fund and the Federal
Disability Insurance Trust Fund, as appropriate.
``(6) Authorization of appropriations.--The assessments
authorized under this section shall be collected and available for
obligation only to the extent and in the amount provided in advance
in appropriations Acts. Amounts so appropriated are authorized to
remain available until expended, for administrative expenses in
carrying out this title and related laws.''.
(2) Conforming amendments.--
(A) Section 206(a)(4)(A) of such Act (42 U.S.C.
406(a)(4)(A)) is amended by inserting ``and subsection (d)''
after ``subparagraph (B)''.
(B) Section 206(b)(1)(A) of such Act (42 U.S.C.
406(b)(1)(A)) is amended by inserting ``, but subject to
subsection (d) of this section'' after ``section 205(i)''.
(b) Elimination of 15-Day Waiting Period for Payment of Fees.--
Section 206(a)(4) of such Act (42 U.S.C. 406(a)(4)), as amended by
subsection (a)(2)(A) of this section, is amended--
(1) by striking ``(4)(A)'' and inserting ``(4)'';
(2) by striking ``subparagraph (B) and''; and
(3) by striking subparagraph (B).
(c) GAO Study and Report.--
(1) Study.--The Comptroller General of the United States shall
conduct a study that--
(A) examines the costs incurred by the Social Security
Administration in administering the provisions of subsection
(a)(4) and (b)(1) of section 206 of the Social Security Act (42
U.S.C. 406) and itemizes the components of such costs,
including the costs of determining fees to attorneys from the
past-due benefits of claimants before the Commissioner of
Social Security and of certifying such fees;
(B) identifies efficiencies that the Social Security
Administration could implement to reduce such costs;
(C) examines the feasibility and advisability of linking
the payment of, or the amount of, the assessment under section
206(d) of the Social Security Act (42 U.S.C. 406(d)) to the
timeliness of the payment of the fee to the attorney as
certified by the Commissioner of Social Security pursuant to
subsection (a)(4) or (b)(1) of section 206 of such Act (42
U.S.C. 406);
(D) determines whether the provisions of subsection (a)(4)
and (b)(1) of section 206 of such Act (42 U.S.C. 406) should be
applied to claimants under title XVI of such Act (42 U.S.C 1381
et seq.);
(E) determines the feasibility and advisability of stating
fees under section 206(d) of such Act (42 U.S.C. 406(d)) in
terms of a fixed dollar amount as opposed to a percentage;
(F) determines whether the dollar limit specified in
section 206(a)(2)(A)(ii)(II) of such Act (42 U.S.C.
406(a)(2)(A)(ii)(II)) should be raised; and
(G) determines whether the assessment on attorneys required
under section 206(d) of such Act (42 U.S.C. 406(d)) (as added
by subsection (a)(1) of this section) impairs access to legal
representation for claimants.
(2) Report.--Not later than 1 year after the date of the
enactment of this Act, the Comptroller General of the United States
shall submit a report to the Committee on Ways and Means of the
House of Representatives and the Committee on Finance of the Senate
on the study conducted under paragraph (1), together with any
recommendations for legislation that the Comptroller General
determines to be appropriate as a result of such study.
(d) Effective Date.--The amendments made by this section shall
apply in the case of any attorney with respect to whom a fee for
services is required to be certified for payment from a claimant's
past-due benefits pursuant to subsection (a)(4) or (b)(1) of section
206 of the Social Security Act after the later of--
(1) December 31, 1999, or
(2) the last day of the first month beginning after the month
in which this Act is enacted.

b521aff33aff7fc46935d833f37c6a31ea0afaa656d7e8eb3d4f73168202e1b0

(a) Extension of Authority To Investigate and Prosecute Fraud in
Other Federal Health Care Programs.--Section 1903(q)(3) of the Social
Security Act (42 U.S.C. 1396b(q)(3)) is amended--
(1) by inserting ``(A)'' after ``in connection with''; and
(2) by striking ``title.'' and inserting ``title; and (B) upon
the approval of the Inspector General of the relevant Federal
agency, any aspect of the provision of health care services and
activities of providers of such services under any Federal health
care program (as defined in section 1128B(f)(1)), if the suspected
fraud or violation of law in such case or investigation is
primarily related to the State plan under this title.''.
(b) Recoupment of Funds.--Section 1903(q)(5) of such Act (42 U.S.C.
1396b(q)(5)) is amended--
(1) by inserting ``or under any Federal health care program (as
so defined)'' after ``plan''; and
(2) by adding at the end the following: ``All funds collected
in accordance with this paragraph shall be credited exclusively to,
and available for expenditure under, the Federal health care
program (including the State plan under this title) that was
subject to the activity that was the basis for the collection.''.
(c) Extension of Authority To Investigate and Prosecute Resident
Abuse in Non-Medicaid Board and Care Facilities.--Section 1903(q)(4) of
such Act (42 U.S.C. 1396b(q)(4)) is amended to read as follows:
``(4)(A) The entity has--
``(i) procedures for reviewing complaints of abuse or
neglect of patients in health care facilities which receive
payments under the State plan under this title;
``(ii) at the option of the entity, procedures for
reviewing complaints of abuse or neglect of patients residing
in board and care facilities; and
``(iii) procedures for acting upon such complaints under
the criminal laws of the State or for referring such complaints
to other State agencies for action.
``(B) For purposes of this paragraph, the term `board and care
facility' means a residential setting which receives payment
(regardless of whether such payment is made under the State plan
under this title) from or on behalf of two or more unrelated adults
who reside in such facility, and for whom one or both of the
following is provided:
``(i) Nursing care services provided by, or under the
supervision of, a registered nurse, licensed practical nurse,
or licensed nursing assistant.
``(ii) A substantial amount of personal care services that
assist residents with the activities of daily living, including
personal hygiene, dressing, bathing, eating, toileting,
ambulation, transfer, positioning, self-medication, body care,
travel to medical services, essential shopping, meal
preparation, laundry, and housework.''.
(d) Effective Date.--The amendments made by this section take
effect on the date of the enactment of this Act.

b1d77eeb11cc4eaa5e849c02f7644ea5852bf6c42c807da9ed07928222913fbf

Notwithstanding any other provision of law, the National Oceanic
and Atmospheric Administration shall initiate a new competitive
contract procurement for its multi-year program for key entry of
valuable climate records, archive services, and database development in
accordance with existing Federal procurement laws and regulations.

96a1ff19f98cf179034af65b4a285bd491862a47d446729f9d40a983a73a7794

(a) Amendment.--Section 438(b)(2) of the Higher Education Act of
1965 (20 U.S.C. 1087-1(b)(2)) is amended--
(1) in subparagraph (A), by striking ``(G), and (H)'' and
inserting ``(G), (H), and (I)'';
(2) in subparagraph (B)(iv), by striking ``(G), or (H)'' and
inserting ``(G), (H), or (I)'';
(3) in subparagraph (C)(ii), by striking ``(G) and (H)'' and
inserting ``(G), (H), and (I)'';
(4) in the heading of subparagraph (H), by striking ``july 1,
2003'' and inserting ``january 1, 2000'';
(5) in subparagraph (H), by striking ``July 1, 2003,'' each
place it appears and inserting ``January 1, 2000,''; and
(6) by inserting after subparagraph (H) the following new
subparagraph:
``(I) Loans disbursed on or after january 1, 2000, and
before july 1, 2003.--
``(i) In general.--Notwithstanding subparagraphs (G)
and (H), but subject to paragraph (4) and clauses (ii),
(iii), and (iv) of this subparagraph, and except as
provided in subparagraph (B), the special allowance paid
pursuant to this subsection on loans for which the first
disbursement is made on or after January 1, 2000, and
before July 1, 2003, shall be computed--
``(I) by determining the average of the bond
equivalent rates of the quotes of the 3-month
commercial paper (financial) rates in effect for each
of the days in such quarter as reported by the Federal
Reserve in Publication H-15 (or its successor) for such
3-month period;
``(II) by subtracting the applicable interest rates
on such loans from such average bond equivalent rate;
``(III) by adding 2.34 percent to the resultant
percent; and
``(IV) by dividing the resultant percent by 4.
``(ii) In school and grace period.--In the case of any
loan for which the first disbursement is made on or after
January 1, 2000, and before July 1, 2003, and for which the
applicable rate of interest is described in section
427A(k)(2), clause (i)(III) of this subparagraph shall be
applied by substituting `1.74 percent' for `2.34 percent'.
``(iii) PLUS loans.--In the case of any loan for which
the first disbursement is made on or after January 1, 2000,
and before July 1, 2003, and for which the applicable rate
of interest is described in section 427A(k)(3), clause
(i)(III) of this subparagraph shall be applied by
substituting `2.64 percent' for `2.34 percent', subject to
clause (v) of this subparagraph.
``(iv) Consolidation loans.--In the case of any
consolidation loan for which the application is received by
an eligible lender on or after January 1, 2000, and before
July 1, 2003, and for which the applicable interest rate is
determined under section 427A(k)(4), clause (i)(III) of
this subparagraph shall be applied by substituting `2.64
percent' for `2.34 percent', subject to clause (vi) of this
subparagraph.
``(v) Limitation on special allowances for plus
loans.--In the case of PLUS loans made under section 428B
and first disbursed on or after January 1, 2000, and before
July 1, 2003, for which the interest rate is determined
under section 427A(k)(3), a special allowance shall not be
paid for such loan during any 12-month period beginning on
July 1 and ending on June 30 unless, on the June 1
preceding such July 1--
``(I) the bond equivalent rate of 91-day Treasury
bills auctioned at the final auction held prior to such
June 1 (as determined by the Secretary for purposes of
such section); plus
``(II) 3.1 percent,
exceeds 9.0 percent.
``(vi) Limitation on special allowances for
consolidation loans.--In the case of consolidation loans
made under section 428C and for which the application is
received on or after January 1, 2000, and before July 1,
2003, for which the interest rate is determined under
section 427A(k)(4), a special allowance shall not be paid
for such loan during any 3-month period ending March 31,
June 30, September 30, or December 31 unless--
``(I) the average of the bond equivalent rates of
the quotes of the 3-month commercial paper (financial)
rates in effect for each of the days in such quarter as
reported by the Federal Reserve in Publication H-15 (or
its successor) for such 3-month period; plus
``(II) 2.64 percent,
exceeds the rate determined under section 427A(k)(4).''.
(b) Effective Date.--Subparagraph (I) of section 438(b)(2) of the
Higher Education Act of 1965 (20 U.S.C. 1087-1(b)(2)) as added by
subsection (a) of this section shall apply with respect to any payment
pursuant to such section with respect to any 3-month period beginning
on or after January 1, 2000, for loans for which the first disbursement
is made after such date.

b8f1169068754cb938ee7cec4311fc8967c7937ee43adbbf534f9e3b966d8692

AGREEMENTS.
(a) Schedule for SSI Supplementation Payments.--
(1) In general.--Section 1616(d) of the Social Security Act (42
U.S.C. 1382e(d)) is amended--
(A) in paragraph (1), by striking ``at such times and in
such installments as may be agreed upon between the
Commissioner of Social Security and such State'' and inserting
``in accordance with paragraph (5)''; and
(B) by adding at the end the following new paragraph:
``(5)(A)(i) Any State which has entered into an agreement with the
Commissioner of Social Security under this section shall remit the
payments and fees required under this subsection with respect to
monthly benefits paid to individuals under this title no later than--
``(I) the business day preceding the date that the Commissioner
pays such monthly benefits; or
``(II) with respect to such monthly benefits paid for the month
that is the last month of the State's fiscal year, the fifth
business day following such date.
``(ii) The Commissioner may charge States a penalty in an amount
equal to 5 percent of the payment and the fees due if the remittance is
received after the date required by clause (i).
``(B) The Cash Management Improvement Act of 1990 shall not apply
to any payments or fees required under this subsection that are paid by
a State before the date required by subparagraph (A)(i).
``(C) Notwithstanding subparagraph (A)(i), the Commissioner may
make supplementary payments on behalf of a State with funds
appropriated for payment of benefits under this title, and subsequently
to be reimbursed for such payments by the State at such times as the
Commissioner and State may agree. Such authority may be exercised only
if extraordinary circumstances affecting a State's ability to make
payment when required by subparagraph (A)(i) are determined by the
Commissioner to exist.''.
(2) Amendment to section 212.--Section 212 of Public Law 93-66
(42 U.S.C. 1382 note) is amended--
(A) in subsection (b)(3)(A), by striking ``at such times
and in such installments as may be agreed upon between the
Secretary and the State'' and inserting ``in accordance with
subparagraph (E)'';
(B) by adding at the end of subsection (b)(3) the following
new subparagraph:
``(E)(i) Any State which has entered into an agreement with the
Commissioner of Social Security under this section shall remit the
payments and fees required under this paragraph with respect to monthly
benefits paid to individuals under title XVI of the Social Security Act
no later than--
``(I) the business day preceding the date that the Commissioner
pays such monthly benefits; or
``(II) with respect to such monthly benefits paid for the month
that is the last month of the State's fiscal year, the fifth
business day following such date.
``(ii) The Cash Management Improvement Act of 1990 shall not apply
to any payments or fees required under this paragraph that are paid by
a State before the date required by clause (i).
``(iii) Notwithstanding clause (i), the Commissioner may make
supplementary payments on behalf of a State with funds appropriated for
payment of supplemental security income benefits under title XVI of the
Social Security Act, and subsequently to be reimbursed for such
payments by the State at such times as the Commissioner and State may
agree. Such authority may be exercised only if extraordinary
circumstances affecting a State's ability to make payment when required
by clause (i) are determined by the Commissioner to exist.''; and
(C) by striking ``Secretary of Health, Education, and
Welfare'' and ``Secretary'' each place such term appear and
inserting ``Commissioner of Social Security''.
(b) Effective Date.--The amendments made by subsection (a) shall
apply to payments and fees arising under an agreement between a State
and the Commissioner of Social Security under section 1616 of the
Social Security Act (42 U.S.C. 1382e) or under section 212 of Public
Law 93-66 (42 U.S.C. 1382 note) with respect to monthly benefits paid
to individuals under title XVI of the Social Security Act for months
after September 2009 (October 2009 in the case of a State with a fiscal
year that coincides with the Federal fiscal year), without regard to
whether the agreement has been modified to reflect such amendments or
the Commissioner has promulgated regulations implementing such
amendments.

b5b387b830c49148a4d2a9590ef449ea43ef0381e004fef888ad154cd4f6536b

Section 6(e)(1) of the Richard B. Russell National School Lunch Act
(42 U.S.C. 1755(e)(1)) is amended--
(1) by striking ``in the form of commodity assistance'' and
inserting ``in the form of--
``(A) commodity assistance'';
(2) by striking the period at the end and inserting ``; or'';
and
(3) by adding at the end the following:
``(B) during the period beginning October 1, 2000, and ending
September 30, 2009, commodities provided by the Secretary under any
provision of law.''.

332c9de773a8409a0911515c9396e827429de77b0a815fd3410d58eea799c8ac

(a) In General.--Section 32(c)(3)(B)(iii) of the Internal Revenue
Code of 1986 (defining eligible foster child) is amended by
redesignating subclauses (I) and (II) as subclauses (II) and (III),
respectively, and by inserting before subclause (II), as so
redesignated, the following:
``(I) is a brother, sister, stepbrother, or
stepsister of the taxpayer (or a descendant of any such
relative) or is placed with the taxpayer by an
authorized placement agency,''.
(b) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1999.

7c33cf240aba5db43994dc28535a2a124615c92680f19cbd477b5b0517105c79

TRANSPLANTATION NETWORK FINAL RULE.
(a) In General.--The final rule entitled ``Organ Procurement and
Transplantation Network'', promulgated by the Secretary of Health and
Human Services on April 2, 1998 (63 Fed. Reg. 16295 et seq.) (relating
to part 121 of title 42, Code of Federal Regulations), together with
the amendments to such rules promulgated on October 20, 1999 (64 Fed.
Reg. 56649 et seq.) shall not become effective before the expiration of
the 90-day period beginning on the date of the enactment of this Act.
(b) Notice and Review.--For purposes of subsection (a):
(1) Not later than 3 days after the date of the enactment of
this Act, the Secretary of Health and Human Services (referred to
in this subsection as the ``Secretary'') shall publish in the
Federal Register a notice providing that the period within which
comments on the final rule may be submitted to the Secretary is 60
days after the date of such publication of the notice.
(2) Not later than 21 days after the expiration of such 60-day
period, the Secretary shall complete the review of the comments
submitted pursuant to paragraph (1) and shall amend the final rule
with any revisions appropriate according to the review by the
Secretary of such comments. The final rule may be in the form of
amendments to the rule referred to in subsection (a) that was
promulgated on April 2, 1998, and in the form of amendments to the
rule referred to in such subsection that was promulgated on October
20, 1999.

0df3264752523c54ff94e592a789f779f21d3b74fbf183b6364de8c25fd372ac

This title may be cited as the ``Tax Relief Extension Act of
1999''.
Subtitle A--Extensions

d4b4cd59a73f5a1ae990d7e40775dd25a2c8b30ca8d29ef3e8f9f4e9d6fb9507

AND MINIMUM TAX LIABILITY.
(a) In General.--Subsection (a) of section 26 of the Internal
Revenue Code of 1986 (relating to limitation based on amount of tax) is
amended to read as follows:
``(a) Limitation Based on Amount of Tax.--
``(1) In general.--The aggregate amount of credits allowed by
this subpart for the taxable year shall not exceed the excess (if
any) of--
``(A) the taxpayer's regular tax liability for the taxable
year, over
``(B) the tentative minimum tax for the taxable year
(determined without regard to the alternative minimum tax
foreign tax credit).
For purposes of subparagraph (B), the taxpayer's tentative minimum
tax for any taxable year beginning during 1999 shall be treated as
being zero.''.
``(2) Special rule for 2000 and 2001.--For purposes of any
taxable year beginning during 2000 or 2001, the aggregate amount of
credits allowed by this subpart for the taxable year shall not
exceed the sum of--
``(A) the taxpayer's regular tax liability for the taxable
year reduced by the foreign tax credit allowable under section
27(a), and
``(B) the tax imposed by section 55(a) for the taxable
year.''.
(b) Conforming Amendments.--
(1) Section 24(d)(2) of such Code is amended by striking
``1998'' and inserting ``2001''.
(2) Section 904(h) of such Code is amended by adding at the end
the following: ``This subsection shall not apply to taxable years
beginning during 2000 or 2001.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1998.

1062250fc98b3aadba7ea2da0b98589eac942f9371f6b01a54db8571ec0ec9d1

(a) Extension.--
(1) In general.--Paragraph (1) of section 41(h) of the Internal
Revenue Code of 1986 (relating to termination) is amended--
(A) by striking ``June 30, 1999'' and inserting ``June 30,
2004''; and
(B) by striking the material following subparagraph (B).
(2) Technical amendment.--Subparagraph (D) of section 45C(b)(1)
of such Code is amended by striking ``June 30, 1999'' and inserting
``June 30, 2004''.
(3) Effective date.--The amendments made by this subsection
shall apply to amounts paid or incurred after June 30, 1999.
(b) Increase in Percentages Under Alternative Incremental Credit.--
(1) In general.--Subparagraph (A) of section 41(c)(4) of such
Code is amended--
(A) by striking ``1.65 percent'' and inserting ``2.65
percent'';
(B) by striking ``2.2 percent'' and inserting ``3.2
percent''; and
(C) by striking ``2.75 percent'' and inserting ``3.75
percent''.
(2) Effective date.--The amendments made by this subsection
shall apply to taxable years beginning after June 30, 1999.
(c) Extension of Research Credit to Research in Puerto Rico and the
possessions of the United States.--
(1) In general.--Subsections (c)(6) and (d)(4)(F) of section 41
of such Code (relating to foreign research) are each amended by
inserting ``, the Commonwealth of Puerto Rico, or any possession of
the United States'' after ``United States''.
(2) Denial of double benefit.--Section 280C(c)(1) of such Code
is amended by inserting ``or credit'' after ``deduction'' each
place it appears.
(3) Effective date.--The amendments made by this subsection
shall apply to amounts paid or incurred after June 30, 1999.
(d) Special Rule.--
(1) In general.--For purposes of the Internal Revenue Code of
1986, the credit determined under section 41 of such Code which is
otherwise allowable under such Code--
(A) shall not be taken into account prior to October 1,
2000, to the extent such credit is attributable to the first
suspension period; and
(B) shall not be taken into account prior to October 1,
2001, to the extent such credit is attributable to the second
suspension period.
On or after the earliest date that an amount of credit may be taken
into account, such amount may be taken into account through the
filing of an amended return, an application for expedited refund,
an adjustment of estimated taxes, or other means allowed by such
Code.
(2) Suspension periods.--For purposes of this subsection--
(A) the first suspension period is the period beginning on
July 1, 1999, and ending on September 30, 2000; and
(B) the second suspension period is the period beginning on
October 1, 2000, and ending on September 30, 2001.
(3) Expedited refunds.--
(A) In general.--If there is an overpayment of tax with
respect to a taxable year by reason of paragraph (1), the
taxpayer may file an application for a tentative refund of such
overpayment. Such application shall be in such manner and form,
and contain such information, as the Secretary may prescribe.
(B) Deadline for applications.--Subparagraph (A) shall
apply only to an application filed before the date which is 1
year after the close of the suspension period to which the
application relates.
(C) Allowance of adjustments.--Not later than 90 days after
the date on which an application is filed under this paragraph,
the Secretary shall--
(i) review the application;
(ii) determine the amount of the overpayment; and
(iii) apply, credit, or refund such overpayment,
in a manner similar to the manner provided in section 6411(b)
of such Code.
(D) Consolidated returns.--The provisions of section
6411(c) of such Code shall apply to an adjustment under this
paragraph in such manner as the Secretary may provide.
(4) Credit attributable to suspension period.--
(A) In general.--For purposes of this subsection, in the
case of a taxable year which includes a portion of the
suspension period, the amount of credit determined under
section 41 of such Code for such taxable year which is
attributable to such period is the amount which bears the same
ratio to the amount of credit determined under such section 41
for such taxable year as the number of months in the suspension
period which are during such taxable year bears to the number
of months in such taxable year.
(B) Waiver of estimated tax penalties.--No addition to tax
shall be made under section 6654 or 6655 of such Code for any
period before July 1, 1999, with respect to any underpayment of
tax imposed by such Code to the extent such underpayment was
created or increased by reason of subparagraph (A).
(5) Secretary.--For purposes of this subsection, the term
``Secretary'' means the Secretary of the Treasury (or such
Secretary's delegate).

fef286caf8111fc839e7e85542f10865045708255de4f1511bf03e9064f237ef

(a) In General.--Sections 953(e)(10) and 954(h)(9) of the Internal
Revenue Code of 1986 (relating to application) are each amended--
(1) by striking ``the first taxable year'' and inserting
``taxable years'';
(2) by striking ``January 1, 2000'' and inserting ``January 1,
2002''; and
(3) by striking ``within which such'' and inserting ``within
which any such''.
(b) Technical Amendment.--Paragraph (10) of section 953(e) of such
Code is amended by adding at the end the following new sentence: ``If
this subsection does not apply to a taxable year of a foreign
corporation beginning after December 31, 2001 (and taxable years of
United States shareholders ending with or within such taxable year),
then, notwithstanding the preceding sentence, subsection (a) shall be
applied to such taxable years in the same manner as it would if the
taxable year of the foreign corporation began in 1998.''.
(c) Effective Date.--The amendments made by this section shall
apply to taxable years beginning after December 31, 1999.

c66dc7f50e96d4c188809cefb2b4a3303864d4d9ffddee877d0e739115d15eb4

PRODUCTION.
(a) In General.--Subparagraph (H) of section 613A(c)(6) of the
Internal Revenue Code of 1986 (relating to temporary suspension of
taxable limit with respect to marginal production) is amended by
striking ``January 1, 2000'' and inserting ``January 1, 2002''.
(b) Effective Date.--The amendment made by this section shall apply
to taxable years beginning after December 31, 1999.

5e89b9ef44120415f6becd48c2ccc8b7db0a14a54d2f12483e4cc94f6767fc38

(a) Temporary Extension.--Sections 51(c)(4)(B) and 51A(f) of the
Internal Revenue Code of 1986 (relating to termination) are each
amended by striking ``June 30, 1999'' and inserting ``December 31,
2001''.
(b) Clarification of First Year of Employment.--Paragraph (2) of
section 51(i) of such Code is amended by striking ``during which he was
not a member of a targeted group''.
(c) Effective Date.--The amendments made by this section shall
apply to individuals who begin work for the employer after June 30,
1999.

e9485a3a3d3473b444dd53326c55416c1d824299cca3d45221c56d0f5d6249af

(a) In General.--Subsection (d) of section 127 of the Internal
Revenue Code of 1986 (relating to termination) is amended by striking
``May 31, 2000'' and inserting ``December 31, 2001''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to courses beginning after May 31, 2000.

283fcd3bd9a745e15c918cdaa92861d61b14fb342364ee30a349f32a704eb642

ELECTRICITY FROM CERTAIN RENEWABLE RESOURCES.
(a) Extension and Modification of Placed-in-Service Rules.--
Paragraph (3) of section 45(c) of the Internal Revenue Code of 1986 is
amended to read as follows:
``(3) Qualified facility.--
``(A) Wind facility.--In the case of a facility using wind
to produce electricity, the term `qualified facility' means any
facility owned by the taxpayer which is originally placed in
service after December 31, 1993, and before January 1, 2002.
``(B) Closed-loop biomass facility.--In the case of a
facility using closed-loop biomass to produce electricity, the
term `qualified facility' means any facility owned by the
taxpayer which is originally placed in service after December
31, 1992, and before January 1, 2002.
``(C) Poultry waste facility.--In the case of a facility
using poultry waste to produce electricity, the term `qualified
facility' means any facility of the taxpayer which is
originally placed in service after December 31, 1999, and
before January 1, 2002.''.
(b) Expansion of Qualified Energy Resources.--
(1) In general.--Section 45(c)(1) of such Code (defining
qualified energy resources) is amended by striking ``and'' at the
end of subparagraph (A), by striking the period at the end of
subparagraph (B) and inserting ``, and'', and by adding at the end
the following new subparagraph:
``(C) poultry waste.''.
(2) Definition.--Section 45(c) of such Code is amended by
adding at the end the following new paragraph:
``(4) Poultry waste.--The term `poultry waste' means poultry
manure and litter, including wood shavings, straw, rice hulls, and
other bedding material for the disposition of manure.''.
(c) Special Rules.--Section 45(d) of such Code (relating to
definitions and special rules) is amended by adding at the end the
following new paragraphs:
``(6) Credit eligibility in the case of government-owned
facilities using poultry waste.--In the case of a facility using
poultry waste to produce electricity and owned by a governmental
unit, the person eligible for the credit under subsection (a) is
the lessee or the operator of such facility.
``(7) Credit not to apply to electricity sold to utilities
under certain contracts.--
``(A) In general.--The credit determined under subsection
(a) shall not apply to electricity--
``(i) produced at a qualified facility described in
paragraph (3)(A) which is placed in service by the taxpayer
after June 30, 1999, and
``(ii) sold to a utility pursuant to a contract
originally entered into before January 1, 1987 (whether or
not amended or restated after that date).
``(B) Exception.--Subparagraph (A) shall not apply if--
``(i) the prices for energy and capacity from such
facility are established pursuant to an amendment to the
contract referred to in subparagraph (A)(ii),
``(ii) such amendment provides that the prices set
forth in the contract which exceed avoided cost prices
determined at the time of delivery shall apply only to
annual quantities of electricity (prorated for partial
years) which do not exceed the greater of--
``(I) the average annual quantity of electricity
sold to the utility under the contract during calendar
years 1994, 1995, 1996, 1997, and 1998, or
``(II) the estimate of the annual electricity
production set forth in the contract, or, if there is
no such estimate, the greatest annual quantity of
electricity sold to the utility under the contract in
any of the calendar years 1996, 1997, or 1998, and
``(iii) such amendment provides that energy and
capacity in excess of the limitation in clause (ii) may
be--
``(I) sold to the utility only at prices that do
not exceed avoided cost prices determined at the time
of delivery, or
``(II) sold to a third party subject to a mutually
agreed upon advance notice to the utility.
For purposes of this subparagraph, avoided cost prices shall be
determined as provided for in 18 CFR 292.304(d)(1) or any
successor regulation.''.
(d) Effective Date.--The amendments made by this section shall take
effect on the date of the enactment of this Act.

5321965dab73283146c8538d705043368312e5cc4a4d9f0a63a9c6650d5738af

PREFERENCES.
(a) In General.--Section 505 of the Trade Act of 1974 (19 U.S.C.
2465) is amended by striking ``June 30, 1999'' and inserting
``September 30, 2001''.
(b) Effective Date.--
(1) In general.--The amendment made by this section applies to
articles entered on or after the date of the enactment of this Act.
(2) Retroactive application for certain liquidations and
reliquidations.--
(A) General rule.--Notwithstanding section 514 of the
Tariff Act of 1930 or any other provision of law, and subject
to paragraph (3), any entry--
(i) of an article to which duty-free treatment under
title V of the Trade Act of 1974 would have applied if such
entry had been made on July 1, 1999, and such title had
been in effect on July 1, 1999; and
(ii) that was made--
(I) after June 30, 1999; and
(II) before the date of the enactment of this Act,
shall be liquidated or reliquidated as free of duty, and the
Secretary of the Treasury shall refund any duty paid with
respect to such entry.
(B) Entry.--As used in this paragraph, the term ``entry''
includes a withdrawal from warehouse for consumption.
(3) Requests.--Liquidation or reliquidation may be made under
paragraph (2) with respect to an entry only if a request therefore
is filed with the Customs Service, within 180 days after the date
of the enactment of this Act, that contains sufficient information
to enable the Customs Service--
(A) to locate the entry; or
(B) to reconstruct the entry if it cannot be located.

94104176cbfbe54f57d23ad4b44be5b02b28cb10376226e8604c3c291679f410

BONDS.
(a) In General.--Section 1397E(e)(1) of the Internal Revenue Code
of 1986 (relating to national limitation) is amended by striking ``and
1999'' and inserting ``, 1999, 2000, and 2001''.
(b) Limitation on Carryover Periods.--Paragraph (4) of section
1397E(e) of such Code is amended by adding at the end the following
flush sentences:
``Any carryforward of a limitation amount may be carried only to
the first 2 years (3 years for carryforwards from 1998 or 1999)
following the unused limitation year. For purposes of the preceding
sentence, a limitation amount shall be treated as used on a first-
in first-out basis.''.

39285d901cdf9a954348d31a2e7bf8f07a8971f541fdf02dede3157937068012

COLUMBIA.
Section 1400C(i) of the Internal Revenue Code of 1986 is amended by
striking ``2001'' and inserting ``2002''.

db05ce98bf9920a1dacdf56631f0d24f10dc992659488f475514830786d29c37

Section 198(h) of the Internal Revenue Code of 1986 is amended by
striking ``2000'' and inserting ``2001''.

84209341cf332a6fca7788c0c940a513c095906bede1685694e2cf108ac59f59

TO PUERTO RICO AND VIRGIN ISLANDS.
(a) In General.--Section 7652(f)(1) of the Internal Revenue Code of
1986 (relating to limitation on cover over of tax on distilled spirits)
is amended to read as follows:
``(1) $10.50 ($13.25 in the case of distilled spirits brought
into the United States after June 30, 1999, and before January 1,
2002), or''.
(b) Special Cover Over Transfer Rules.--Notwithstanding section
7652 of the Internal Revenue Code of 1986, the following rules shall
apply with respect to any transfer before October 1, 2000, of amounts
relating to the increase in the cover over of taxes by reason of the
amendment made by subsection (a):
(1) Initial transfer of incremental increase in cover over.--
The Secretary of the Treasury shall, within 15 days after the date
of the enactment of this Act, transfer an amount equal to the
lesser of--
(A) the amount of such increase otherwise required to be
covered over after June 30, 1999, and before the date of the
enactment of this Act; or
(B) $20,000,000.
(2) Transfer of incremental increase for fiscal year 2001.--The
Secretary of the Treasury shall on October 1, 2000, transfer an
amount equal to the excess of--
(A) the amount of such increase otherwise required to be
covered over after June 30, 1999, and before October 1, 2000,
over
(B) the amount of the transfer described in paragraph (1).
(c) Effective Date.--The amendment made by subsection (a) shall
take effect on July 1, 1999.
Subtitle B--Other Time-Sensitive Provisions

4f470d28e941688c0daa688551c870c98e36ddf334370264da5feb15547abe5d

INFORMATION.
(a) In General.--
(1) Treatment as return information.--Paragraph (2) of section
6103(b) of the Internal Revenue Code of 1986 (defining return
information) is amended by striking ``and'' at the end of
subparagraph (A), by inserting ``and'' at the end of subparagraph
(B), and by inserting after subparagraph (B) the following new
subparagraph:
``(C) any advance pricing agreement entered into by a
taxpayer and the Secretary and any background information
related to such agreement or any application for an advance
pricing agreement,''.
(2) Exception from public inspection as written
determination.--Paragraph (1) of section 6110(b) of such Code
(defining written determination) is amended by adding at the end
the following new sentence: ``Such term shall not include any
advance pricing agreement entered into by a taxpayer and the
Secretary and any background information related to such agreement
or any application for an advance pricing agreement.''.
(3) Effective date.--The amendments made by this subsection
shall take effect on the date of the enactment of this Act.
(b) Annual Report Regarding Advance Pricing Agreements.--
(1) In general.--Not later than 90 days after the end of each
calendar year, the Secretary of the Treasury shall prepare and
publish a report regarding advance pricing agreements.
(2) Contents of report.--The report shall include the following
for the calendar year to which such report relates:
(A) Information about the structure, composition, and
operation of the advance pricing agreement program office.
(B) A copy of each model advance pricing agreement.
(C) The number of--
(i) applications filed during such calendar year for
advance pricing agreements;
(ii) advance pricing agreements executed cumulatively
to date and during such calendar year;
(iii) renewals of advance pricing agreements issued;
(iv) pending requests for advance pricing agreements;
(v) pending renewals of advance pricing agreements;
(vi) for each of the items in clauses (ii) through (v),
the number that are unilateral, bilateral, and
multilateral, respectively;
(vii) advance pricing agreements revoked or canceled,
and the number of withdrawals from the advance pricing
agreement program; and
(viii) advance pricing agreements finalized or renewed
by industry.
(D) General descriptions of--
(i) the nature of the relationships between the related
organizations, trades, or businesses covered by advance
pricing agreements;
(ii) the covered transactions and the business
functions performed and risks assumed by such
organizations, trades, or businesses;
(iii) the related organizations, trades, or businesses
whose prices or results are tested to determine compliance
with transfer pricing methodologies prescribed in advance
pricing agreements;
(iv) methodologies used to evaluate tested parties and
transactions and the circumstances leading to the use of
those methodologies;
(v) critical assumptions made and sources of
comparables used;
(vi) comparable selection criteria and the rationale
used in determining such criteria;
(vii) the nature of adjustments to comparables or
tested parties;
(viii) the nature of any ranges agreed to, including
information regarding when no range was used and why, when
interquartile ranges were used, and when there was a
statistical narrowing of the comparables;
(ix) adjustment mechanisms provided to rectify results
that fall outside of the agreed upon advance pricing
agreement range;
(x) the various term lengths for advance pricing
agreements, including rollback years, and the number of
advance pricing agreements with each such term length;
(xi) the nature of documentation required; and
(xii) approaches for sharing of currency or other
risks.
(E) Statistics regarding the amount of time taken to
complete new and renewal advance pricing agreements.
(F) A detailed description of the Secretary of the
Treasury's efforts to ensure compliance with existing advance
pricing agreements.
(3) Confidentiality.--The reports required by this subsection
shall be treated as authorized by the Internal Revenue Code of 1986
for purposes of section 6103 of such Code, but the reports shall
not include information--
(A) which would not be permitted to be disclosed under
section 6110(c) of such Code if such report were a written
determination as defined in section 6110 of such Code; or
(B) which can be associated with, or otherwise identify,
directly or indirectly, a particular taxpayer.
(4) First report.--The report for calendar year 1999 shall
include prior calendar years after 1990.
(c) Regulations.--The Secretary of the Treasury or the Secretary's
delegate shall prescribe such regulations as may be necessary or
appropriate to carry out the purposes of section 6103(b)(2)(C), and the
last sentence of section 6110(b)(1), of the Internal Revenue Code of
1986, as added by this section.

35a3be361e65458515b9fc9ee25c2e93dc725d8d68f4f18b04f081db10d444bc

OF Y2K FAILURES.
(a) In General.--In the case of a taxpayer determined by the
Secretary of the Treasury (or the Secretary's delegate) to be affected
by a Y2K failure, the Secretary may disregard a period of up to 90 days
in determining, under the internal revenue laws, in respect of any tax
liability (including any interest, penalty, additional amount, or
addition to the tax) of such taxpayer--
(1) whether any of the acts described in paragraph (1) of
section 7508(a) of the Internal Revenue Code of 1986 (without
regard to the exceptions in parentheses in subparagraphs (A) and
(B)) were performed within the time prescribed therefor; and
(2) the amount of any credit or refund.
(b) Applicability of Certain Rules.--For purposes of this section,
rules similar to the rules of subsections (b) and (e) of section 7508
of the Internal Revenue Code of 1986 shall apply.

8d0302b11b6b525aec4a926e792ee66b01b95c3f0a9a5a91a778210d34354ff0

PNEUMONIAE TO LIST OF TAXABLE VACCINES.
(a) Inclusion of Vaccines.--
(1) In general.--Section 4132(a)(1) of the Internal Revenue
Code of 1986 (defining taxable vaccine) is amended by adding at the
end the following new subparagraph:
``(L) Any conjugate vaccine against streptococcus
pneumoniae.''.
(2) Effective date.--
(A) Sales.--The amendment made by this subsection shall
apply to vaccine sales after the date of the enactment of this
Act, but shall not take effect if subsection (b) does not take
effect.
(B) Deliveries.--For purposes of subparagraph (A), in the
case of sales on or before the date described in such
subparagraph for which delivery is made after such date, the
delivery date shall be considered the sale date.
(b) Vaccine Tax and Trust Fund Amendments.--
(1) Sections 1503 and 1504 of the Vaccine Injury Compensation
Program Modification Act (and the amendments made by such sections)
are hereby repealed.
(2) Subparagraph (A) of section 9510(c)(1) of such Code is
amended by striking ``August 5, 1997'' and inserting ``December 31,
1999''.
(3) The amendments made by this subsection shall take effect as
if included in the provisions of the Omnibus Consolidated and
Emergency Supplemental Appropriations Act, 1999 to which they
relate.
(c) Report.--Not later than January 31, 2000, the Comptroller
General of the United States shall prepare and submit a report to the
Committee on Ways and Means of the House of Representatives and the
Committee on Finance of the Senate on the operation of the Vaccine
Injury Compensation Trust Fund and on the adequacy of such Fund to meet
future claims made under the Vaccine Injury Compensation Program.

59d9ccfdfe5a2867ba132186a2d27f39c7a4e0903e2a537656b3de42c9fac82c

KEROSENE TERMINALS.
Paragraph (2) of section 1032(f) of the Taxpayer Relief Act of 1997
is amended by striking ``July 1, 2000'' and inserting ``January 1,
2002''.

8bd0573ded095c58e8ad6b64f2883e7c6e98111fa2010de73c82f96bbb262ccf

Any option to accelerate the receipt of any payment under a
production flexibility contract which is payable under the Federal
Agriculture Improvement and Reform Act of 1996 (7 U.S.C. 7200 et seq.),
as in effect on the date of the enactment of this Act, shall be
disregarded in determining the taxable year for which such payment is
properly includible in gross income for purposes of the Internal
Revenue Code of 1986.
Subtitle C--Revenue Offsets
PART I--GENERAL PROVISIONS

6bbc8909751582f3aba8945eeae19f993ea80f6cd9239bf69e412cf7c7bb2ff1

(a) In General.--The table contained in clause (i) of section
6654(d)(1)(C) of the Internal Revenue Code of 1986 (relating to
limitation on use of preceding year's tax) is amended by striking the
items relating to 1999 and 2000 and inserting the following new items:
``1999....................................................
108.6
2000......................................................
110''.
(b) Effective Date.--The amendment made by this section shall apply
with respect to any installment payment for taxable years beginning
after December 31, 1999.

9c50a5413a31f8bc39d60c72de9956813492548f622e1bd6c5b2478b22add971

DERIVATIVES.
(a) In General.--Section 1221 of the Internal Revenue Code of 1986
(defining capital assets) is amended--
(1) by striking ``For purposes'' and inserting the following:
``(a) In General.--For purposes'';
(2) by striking the period at the end of paragraph (5) and
inserting a semicolon; and
(3) by adding at the end the following:
``(6) any commodities derivative financial instrument held by a
commodities derivatives dealer, unless--
``(A) it is established to the satisfaction of the
Secretary that such instrument has no connection to the
activities of such dealer as a dealer, and
``(B) such instrument is clearly identified in such
dealer's records as being described in subparagraph (A) before
the close of the day on which it was acquired, originated, or
entered into (or such other time as the Secretary may by
regulations prescribe);
``(7) any hedging transaction which is clearly identified as
such before the close of the day on which it was acquired,
originated, or entered into (or such other time as the Secretary
may by regulations prescribe); or
``(8) supplies of a type regularly used or consumed by the
taxpayer in the ordinary course of a trade or business of the
taxpayer.
``(b) Definitions and Special Rules.--
``(1) Commodities derivative financial instruments.--For
purposes of subsection (a)(6)--
``(A) Commodities derivatives dealer.--The term
`commodities derivatives dealer' means a person which regularly
offers to enter into, assume, offset, assign, or terminate
positions in commodities derivative financial instruments with
customers in the ordinary course of a trade or business.
``(B) Commodities derivative financial instrument.--
``(i) In general.--The term `commodities derivative
financial instrument' means any contract or financial
instrument with respect to commodities (other than a share
of stock in a corporation, a beneficial interest in a
partnership or trust, a note, bond, debenture, or other
evidence of indebtedness, or a section 1256 contract (as
defined in section 1256(b)), the value or settlement price
of which is calculated by or determined by reference to a
specified index.
``(ii) Specified index.--The term `specified index'
means any one or more or any combination of--
``(I) a fixed rate, price, or amount, or
``(II) a variable rate, price, or amount,
which is based on any current, objectively determinable
financial or economic information with respect to
commodities which is not within the control of any of the
parties to the contract or instrument and is not unique to
any of the parties' circumstances.
``(2) Hedging transaction.--
``(A) In general.--For purposes of this section, the term
`hedging transaction' means any transaction entered into by the
taxpayer in the normal course of the taxpayer's trade or
business primarily--
``(i) to manage risk of price changes or currency
fluctuations with respect to ordinary property which is
held or to be held by the taxpayer,
``(ii) to manage risk of interest rate or price changes
or currency fluctuations with respect to borrowings made or
to be made, or ordinary obligations incurred or to be
incurred, by the taxpayer, or
``(iii) to manage such other risks as the Secretary may
prescribe in regulations.
``(B) Treatment of nonidentification or improper
identification of hedging transactions.--Notwithstanding
subsection (a)(7), the Secretary shall prescribe regulations to
properly characterize any income, gain, expense, or loss
arising from a transaction--
``(i) which is a hedging transaction but which was not
identified as such in accordance with subsection (a)(7), or
``(ii) which was so identified but is not a hedging
transaction.
``(3) Regulations.--The Secretary shall prescribe such
regulations as are appropriate to carry out the purposes of
paragraph (6) and (7) of subsection (a) in the case of transactions
involving related parties.''.
(b) Management of Risk.--
(1) Section 475(c)(3) of such Code is amended by striking
``reduces'' and inserting ``manages''.
(2) Section 871(h)(4)(C)(iv) of such Code is amended by
striking ``to reduce'' and inserting ``to manage''.
(3) Clauses (i) and (ii) of section 988(d)(2)(A) of such Code
are each amended by striking ``to reduce'' and inserting ``to
manage''.
(4) Paragraph (2) of section 1256(e) of such Code is amended to
read as follows:
``(2) Definition of hedging transaction.--For purposes of this
subsection, the term `hedging transaction' means any hedging
transaction (as defined in section 1221(b)(2)(A)) if, before the
close of the day on which such transaction was entered into (or
such earlier time as the Secretary may prescribe by regulations),
the taxpayer clearly identifies such transaction as being a hedging
transaction.''.
(c) Conforming Amendments.--
(1) Each of the following sections of such Code are amended by
striking ``section 1221'' and inserting ``section 1221(a)'':
(A) Section 170(e)(3)(A).
(B) Section 170(e)(4)(B).
(C) Section 367(a)(3)(B)(i).
(D) Section 818(c)(3).
(E) Section 865(i)(1).
(F) Section 1092(a)(3)(B)(ii)(II).
(G) Subparagraphs (C) and (D) of section 1231(b)(1).
(H) Section 1234(a)(3)(A).
(2) Each of the following sections of such Code are amended by
striking ``section 1221(1)'' and inserting ``section 1221(a)(1)'':
(A) Section 198(c)(1)(A)(i).
(B) Section 263A(b)(2)(A).
(C) Clauses (i) and (iii) of section 267(f)(3)(B).
(D) Section 341(d)(3).
(E) Section 543(a)(1)(D)(i).
(F) Section 751(d)(1).
(G) Section 775(c).
(H) Section 856(c)(2)(D).
(I) Section 856(c)(3)(C).
(J) Section 856(e)(1).
(K) Section 856(j)(2)(B).
(L) Section 857(b)(4)(B)(i).
(M) Section 857(b)(6)(B)(iii).
(N) Section 864(c)(4)(B)(iii).
(O) Section 864(d)(3)(A).
(P) Section 864(d)(6)(A).
(Q) Section 954(c)(1)(B)(iii).
(R) Section 995(b)(1)(C).
(S) Section 1017(b)(3)(E)(i).
(T) Section 1362(d)(3)(C)(ii).
(U) Section 4662(c)(2)(C).
(V) Section 7704(c)(3).
(W) Section 7704(d)(1)(D).
(X) Section 7704(d)(1)(G).
(Y) Section 7704(d)(5).
(3) Section 818(b)(2) of such Code is amended by striking
``section 1221(2)'' and inserting ``section 1221(a)(2)''.
(4) Section 1397B(e)(2) of such Code is amended by striking
``section 1221(4)'' and inserting ``section 1221(a)(4)''.
(d) Effective Date.--The amendments made by this section shall
apply to any instrument held, acquired, or entered into, any
transaction entered into, and supplies held or acquired on or after the
date of the enactment of this Act.

dfe5e3953331480b4f9a1d014e2012f066845849ae7ecda0a4efabbe043a69a2

INCOME.
(a) In General.--Paragraph (2) of section 6050P(c) of the Internal
Revenue Code of 1986 (relating to definitions and special rules) is
amended by striking ``and'' at the end of subparagraph (B), by striking
the period at the end of subparagraph (C) and inserting ``, and'', and
by inserting after subparagraph (C) the following new subparagraph:
``(D) any organization a significant trade or business of
which is the lending of money.''.
(b) Effective Date.--The amendment made by subsection (a) shall
apply to discharges of indebtedness after December 31, 1999.

0233b6befe4688879daf1b4f42df6693eacc96da83fff378c7f97b939ebd4488

CONSTRUCTIVE OWNERSHIP TRANSACTIONS.
(a) In General.--Part IV of subchapter P of chapter 1 of the
Internal Revenue Code of 1986 (relating to special rules for
determining capital gains and losses) is amended by inserting after
section 1259 the following new section:
``SEC. 1260. GAINS FROM CONSTRUCTIVE OWNERSHIP TRANSACTIONS.
``(a) In General.--If the taxpayer has gain from a constructive
ownership transaction with respect to any financial asset and such gain
would (without regard to this section) be treated as a long-term
capital gain--
``(1) such gain shall be treated as ordinary income to the
extent that such gain exceeds the net underlying long-term capital
gain, and
``(2) to the extent such gain is treated as a long-term capital
gain after the application of paragraph (1), the determination of
the capital gain rate (or rates) applicable to such gain under
section 1(h) shall be determined on the basis of the respective
rate (or rates) that would have been applicable to the net
underlying long-term capital gain.
``(b) Interest Charge on Deferral of Gain Recognition.--
``(1) In general.--If any gain is treated as ordinary income
for any taxable year by reason of subsection (a)(1), the tax
imposed by this chapter for such taxable year shall be increased by
the amount of interest determined under paragraph (2) with respect
to each prior taxable year during any portion of which the
constructive ownership transaction was open. Any amount payable
under this paragraph shall be taken into account in computing the
amount of any deduction allowable to the taxpayer for interest paid
or accrued during such taxable year.
``(2) Amount of interest.--The amount of interest determined
under this paragraph with respect to a prior taxable year is the
amount of interest which would have been imposed under section 6601
on the underpayment of tax for such year which would have resulted
if the gain (which is treated as ordinary income by reason of
subsection (a)(1)) had been included in gross income in the taxable
years in which it accrued (determined by treating the income as
accruing at a constant rate equal to the applicable Federal rate as
in effect on the day the transaction closed). The period during
which such interest shall accrue shall end on the due date (without
extensions) for the return of tax imposed by this chapter for the
taxable year in which such transaction closed.
``(3) Applicable federal rate.--For purposes of paragraph (2),
the applicable Federal rate is the applicable Federal rate
determined under section 1274(d) (compounded semiannually) which
would apply to a debt instrument with a term equal to the period
the transaction was open.
``(4) No credits against increase in tax.--Any increase in tax
under paragraph (1) shall not be treated as tax imposed by this
chapter for purposes of determining--
``(A) the amount of any credit allowable under this
chapter, or
``(B) the amount of the tax imposed by section 55.
``(c) Financial Asset.--For purposes of this section--
``(1) In general.--The term `financial asset' means--
``(A) any equity interest in any pass-thru entity, and
``(B) to the extent provided in regulations--
``(i) any debt instrument, and
``(ii) any stock in a corporation which is not a pass-
thru entity.
``(2) Pass-thru entity.--For purposes of paragraph (1), the
term `pass-thru entity' means--
``(A) a regulated investment company,
``(B) a real estate investment trust,
``(C) an S corporation,
``(D) a partnership,
``(E) a trust,
``(F) a common trust fund,
``(G) a passive foreign investment company (as defined in
section 1297 without regard to subsection (e) thereof),
``(H) a foreign personal holding company,
``(I) a foreign investment company (as defined in section
1246(b)), and
``(J) a REMIC.
``(d) Constructive Ownership Transaction.--For purposes of this
section--
``(1) In general.--The taxpayer shall be treated as having
entered into a constructive ownership transaction with respect to
any financial asset if the taxpayer--
``(A) holds a long position under a notional principal
contract with respect to the financial asset,
``(B) enters into a forward or futures contract to acquire
the financial asset,
``(C) is the holder of a call option, and is the grantor of
a put option, with respect to the financial asset and such
options have substantially equal strike prices and
substantially contemporaneous maturity dates, or
``(D) to the extent provided in regulations prescribed by
the Secretary, enters into one or more other transactions (or
acquires one or more positions) that have substantially the
same effect as a transaction described in any of the preceding
subparagraphs.
``(2) Exception for positions which are marked to market.--This
section shall not apply to any constructive ownership transaction
if all of the positions which are part of such transaction are
marked to market under any provision of this title or the
regulations thereunder.
``(3) Long position under notional principal contract.--A
person shall be treated as holding a long position under a notional
principal contract with respect to any financial asset if such
person--
``(A) has the right to be paid (or receive credit for) all
or substantially all of the investment yield (including
appreciation) on such financial asset for a specified period,
and
``(B) is obligated to reimburse (or provide credit for) all
or substantially all of any decline in the value of such
financial asset.
``(4) Forward contract.--The term `forward contract' means any
contract to acquire in the future (or provide or receive credit for
the future value of) any financial asset.
``(e) Net Underlying Long-Term Capital Gain.--For purposes of this
section, in the case of any constructive ownership transaction with
respect to any financial asset, the term `net underlying long-term
capital gain' means the aggregate net capital gain that the taxpayer
would have had if--
``(1) the financial asset had been acquired for fair market
value on the date such transaction was opened and sold for fair
market value on the date such transaction was closed, and
``(2) only gains and losses that would have resulted from the
deemed ownership under paragraph (1) were taken into account.
The amount of the net underlying long-term capital gain with respect to
any financial asset shall be treated as zero unless the amount thereof
is established by clear and convincing evidence.
``(f) Special Rule Where Taxpayer Takes Delivery.--Except as
provided in regulations prescribed by the Secretary, if a constructive
ownership transaction is closed by reason of taking delivery, this
section shall be applied as if the taxpayer had sold all the contracts,
options, or other positions which are part of such transaction for fair
market value on the closing date. The amount of gain recognized under
the preceding sentence shall not exceed the amount of gain treated as
ordinary income under subsection (a). Proper adjustments shall be made
in the amount of any gain or loss subsequently realized for gain
recognized and treated as ordinary income under this subsection.
``(g) Regulations.--The Secretary shall prescribe such regulations
as may be necessary or appropriate to carry out the purposes of this
section, including regulations--
``(1) to permit taxpayers to mark to market constructive
ownership transactions in lieu of applying this section, and
``(2) to exclude certain forward contracts which do not convey
substantially all of the economic return with respect to a
financial asset.''.
(b) Clerical Amendment.--The table of sections for part IV of
subchapter P of chapter 1 of such Code is amended by adding at the end
the following new item:
``Sec. 1260. Gains from constructive ownership transactions.''.
(c) Effective Date.--The amendments made by this section shall
apply to transactions entered into after July 11, 1999.

d332ec991ac84a5d20d93c9efc1e9401d3492a0865ca72ab8595a7828ff78a9e

BENEFITS.
(a) Extension.--
(1) In general.--Paragraph (5) of section 420(b) of the
Internal Revenue Code of 1986 (relating to expiration) is amended
by striking ``in any taxable year beginning after December 31,
2000'' and inserting ``made after December 31, 2005''.
(2) Conforming amendments.--
(A) Section 101(e)(3) of the Employee Retirement Income
Security Act of 1974 (29 U.S.C. 1021(e)(3)) is amended by
striking ``January 1, 1995'' and inserting ``the date of the
enactment of the Tax Relief Extension Act of 1999''.
(B) Section 403(c)(1) of such Act (29 U.S.C. 1103(c)(1)) is
amended by striking ``January 1, 1995'' and inserting ``the
date of the enactment of the Tax Relief Extension Act of
1999''.
(C) Paragraph (13) of section 408(b) of such Act (29 U.S.C.
1108(b)(13)) is amended--
(i) by striking ``in a taxable year beginning before
January 1, 2001'' and inserting ``made before January 1,
2006''; and
(ii) by striking ``January 1, 1995'' and inserting
``the date of the enactment of the Tax Relief Extension Act
of 1999''.
(b) Application of Minimum Cost Requirements.--
(1) In general.--Paragraph (3) of section 420(c) of the
Internal Revenue Code of 1986 is amended to read as follows:
``(3) Minimum cost requirements.--
``(A) In general.--The requirements of this paragraph are
met if each group health plan or arrangement under which
applicable health benefits are provided provides that the
applicable employer cost for each taxable year during the cost
maintenance period shall not be less than the higher of the
applicable employer costs for each of the 2 taxable years
immediately preceding the taxable year of the qualified
transfer.
``(B) Applicable employer cost.--For purposes of this
paragraph, the term `applicable employer cost' means, with
respect to any taxable year, the amount determined by
dividing--
``(i) the qualified current retiree health liabilities
of the employer for such taxable year determined--
``(I) without regard to any reduction under
subsection (e)(1)(B), and
``(II) in the case of a taxable year in which there
was no qualified transfer, in the same manner as if
there had been such a transfer at the end of the
taxable year, by
``(ii) the number of individuals to whom coverage for
applicable health benefits was provided during such taxable
year.
``(C) Election to compute cost separately.--An employer may
elect to have this paragraph applied separately with respect to
individuals eligible for benefits under title XVIII of the
Social Security Act at any time during the taxable year and
with respect to individuals not so eligible.
``(D) Cost maintenance period.--For purposes of this
paragraph, the term `cost maintenance period' means the period
of 5 taxable years beginning with the taxable year in which the
qualified transfer occurs. If a taxable year is in two or more
overlapping cost maintenance periods, this paragraph shall be
applied by taking into account the highest applicable employer
cost required to be provided under subparagraph (A) for such
taxable year.
``(E) Regulations.--The Secretary shall prescribe such
regulations as may be necessary to prevent an employer who
significantly reduces retiree health coverage during the cost
maintenance period from being treated as satisfying the minimum
cost requirement of this subsection.''.
(2) Conforming amendments.--
(A) Clause (iii) of section 420(b)(1)(C) of such Code is
amended by striking ``benefits'' and inserting ``cost''.
(B) Subparagraph (D) of section 420(e)(1) of such Code is
amended by striking ``and shall not be subject to the minimum
benefit requirements of subsection (c)(3)'' and inserting ``or
in calculating applicable employer cost under subsection
(c)(3)(B)''.
(c) Effective Dates.--
(1) In general.--The amendments made by this section shall
apply to qualified transfers occurring after the date of the
enactment of this Act.
(2) Transition rule.--If the cost maintenance period for any
qualified transfer after the date of the enactment of this Act
includes any portion of a benefit maintenance period for any
qualified transfer on or before such date, the amendments made by
subsection (b) shall not apply to such portion of the cost
maintenance period (and such portion shall be treated as a benefit
maintenance period).

fa62ebe5c8f82faf50301f4535da7e157d1a9c0aadf64ce62aaecd6dc49bd0dd

METHOD FOR ACCRUAL METHOD TAXPAYERS.
(a) Repeal of Installment Method for Accrual Basis Taxpayers.--
(1) In general.--Subsection (a) of section 453 of the Internal
Revenue Code of 1986 (relating to installment method) is amended to
read as follows:
``(a) Use of Installment Method.--
``(1) In general.--Except as otherwise provided in this
section, income from an installment sale shall be taken into
account for purposes of this title under the installment method.
``(2) Accrual method taxpayer.--The installment method shall
not apply to income from an installment sale if such income would
be reported under an accrual method of accounting without regard to
this section. The preceding sentence shall not apply to a
disposition described in subparagraph (A) or (B) of subsection
(l)(2).''.
(2) Conforming amendments.--Sections 453(d)(1), 453(i)(1), and
453(k) of such Code are each amended by striking ``(a)'' each place
it appears and inserting ``(a)(1)''.
(b) Modification of Pledge Rules.--Paragraph (4) of section 453A(d)
of such Code (relating to pledges, etc., of installment obligations) is
amended by adding at the end the following: ``A payment shall be
treated as directly secured by an interest in an installment obligation
to the extent an arrangement allows the taxpayer to satisfy all or a
portion of the indebtedness with the installment obligation.''.
(c) Effective Date.--The amendments made by this section shall
apply to sales or other dispositions occurring on or after the date of
the enactment of this Act.

aff9a6f7bdc78714981e29f4820b2c059ca8d0b32ab467f42e0708ec508024e9

ASSOCIATED WITH SPLIT-DOLLAR INSURANCE ARRANGEMENTS.
(a) In General.--Subsection (f) of section 170 of the Internal
Revenue Code of 1986 (relating to disallowance of deduction in certain
cases and special rules) is amended by adding at the end the following
new paragraph:
``(10) Split-dollar life insurance, annuity, and endowment
contracts.--
``(A) In general.--Nothing in this section or in section
545(b)(2), 556(b)(2), 642(c), 2055, 2106(a)(2), or 2522 shall
be construed to allow a deduction, and no deduction shall be
allowed, for any transfer to or for the use of an organization
described in subsection (c) if in connection with such
transfer--
``(i) the organization directly or indirectly pays, or
has previously paid, any premium on any personal benefit
contract with respect to the transferor, or
``(ii) there is an understanding or expectation that
any person will directly or indirectly pay any premium on
any personal benefit contract with respect to the
transferor.
``(B) Personal benefit contract.--For purposes of
subparagraph (A), the term `personal benefit contract' means,
with respect to the transferor, any life insurance, annuity, or
endowment contract if any direct or indirect beneficiary under
such contract is the transferor, any member of the transferor's
family, or any other person (other than an organization
described in subsection (c)) designated by the transferor.
``(C) Application to charitable remainder trusts.--In the
case of a transfer to a trust referred to in subparagraph (E),
references in subparagraphs (A) and (F) to an organization
described in subsection (c) shall be treated as a reference to
such trust.
``(D) Exception for certain annuity contracts.--If, in
connection with a transfer to or for the use of an organization
described in subsection (c), such organization incurs an
obligation to pay a charitable gift annuity (as defined in
section 501(m)) and such organization purchases any annuity
contract to fund such obligation, persons receiving payments
under the charitable gift annuity shall not be treated for
purposes of subparagraph (B) as indirect beneficiaries under
such contract if--
``(i) such organization possesses all of the incidents
of ownership under such contract,
``(ii) such organization is entitled to all the
payments under such contract, and
``(iii) the timing and amount of payments under such
contract are substantially the same as the timing and
amount of payments to each such person under such
obligation (as such obligation is in effect at the time of
such transfer).
``(E) Exception for certain contracts held by charitable
remainder trusts.--A person shall not be treated for purposes
of subparagraph (B) as an indirect beneficiary under any life
insurance, annuity, or endowment contract held by a charitable
remainder annuity trust or a charitable remainder unitrust (as
defined in section 664(d)) solely by reason of being entitled
to any payment referred to in paragraph (1)(A) or (2)(A) of
section 664(d) if--
``(i) such trust possesses all of the incidents of
ownership under such contract, and
``(ii) such trust is entitled to all the payments under
such contract.
``(F) Excise tax on premiums paid.--
``(i) In general.--There is hereby imposed on any
organization described in subsection (c) an excise tax
equal to the premiums paid by such organization on any life
insurance, annuity, or endowment contract if the payment of
premiums on such contract is in connection with a transfer
for which a deduction is not allowable under subparagraph
(A), determined without regard to when such transfer is
made.
``(ii) Payments by other persons.--For purposes of
clause (i), payments made by any other person pursuant to
an understanding or expectation referred to in subparagraph
(A) shall be treated as made by the organization.
``(iii) Reporting.--Any organization on which tax is
imposed by clause (i) with respect to any premium shall
file an annual return which includes--
``(I) the amount of such premiums paid during the
year and the name and TIN of each beneficiary under the
contract to which the premium relates, and
``(II) such other information as the Secretary may
require.
The penalties applicable to returns required under section
6033 shall apply to returns required under this clause.
Returns required under this clause shall be furnished at
such time and in such manner as the Secretary shall by
forms or regulations require.
``(iv) Certain rules to apply.--The tax imposed by this
subparagraph shall be treated as imposed by chapter 42 for
purposes of this title other than subchapter B of chapter
42.
``(G) Special rule where state requires specification of
charitable gift annuitant in contract.--In the case of an
obligation to pay a charitable gift annuity referred to in
subparagraph (D) which is entered into under the laws of a
State which requires, in order for the charitable gift annuity
to be exempt from insurance regulation by such State, that each
beneficiary under the charitable gift annuity be named as a
beneficiary under an annuity contract issued by an insurance
company authorized to transact business in such State, the
requirements of clauses (i) and (ii) of subparagraph (D) shall
be treated as met if--
``(i) such State law requirement was in effect on
February 8, 1999,
``(ii) each such beneficiary under the charitable gift
annuity is a bona fide resident of such State at the time
the obligation to pay a charitable gift annuity is entered
into, and
``(iii) the only persons entitled to payments under
such contract are persons entitled to payments as
beneficiaries under such obligation on the date such
obligation is entered into.
``(H) Member of family.--For purposes of this paragraph, an
individual's family consists of the individual's grandparents,
the grandparents of such individual's spouse, the lineal
descendants of such grandparents, and any spouse of such a
lineal descendant.
``(I) Regulations.--The Secretary shall prescribe such
regulations as may be necessary or appropriate to carry out the
purposes of this paragraph, including regulations to prevent
the avoidance of such purposes.''.
(b) Effective Dates.--
(1) In general.--Except as otherwise provided in this section,
the amendment made by this section shall apply to transfers made
after February 8, 1999.
(2) Excise tax.--Except as provided in paragraph (3) of this
subsection, section 170(f)(10)(F) of the Internal Revenue Code of
1986 (as added by this section) shall apply to premiums paid after
the date of the enactment of this Act.
(3) Reporting.--Clause (iii) of such section 170(f)(10)(F)
shall apply to premiums paid after February 8, 1999 (determined as
if the tax imposed by such section applies to premiums paid after
such date).

31ad0d6ad7d93f54e2dd6eb72d6832dda45bec0c738c1aa5ad078fbfbcfa013b

STOCK IN ANOTHER CORPORATION.
(a) In General.--Section 732 of the Internal Revenue Code of 1986
(relating to basis of distributed property other than money) is amended
by adding at the end the following new subsection:
``(f) Corresponding Adjustment to Basis of Assets of a Distributed
Corporation Controlled by a Corporate Partner.--
``(1) In general.--If--
``(A) a corporation (hereafter in this subsection referred
to as the `corporate partner') receives a distribution from a
partnership of stock in another corporation (hereafter in this
subsection referred to as the `distributed corporation'),
``(B) the corporate partner has control of the distributed
corporation immediately after the distribution or at any time
thereafter, and
``(C) the partnership's adjusted basis in such stock
immediately before the distribution exceeded the corporate
partner's adjusted basis in such stock immediately after the
distribution,
then an amount equal to such excess shall be applied to reduce (in
accordance with subsection (c)) the basis of property held by the
distributed corporation at such time (or, if the corporate partner
does not control the distributed corporation at such time, at the
time the corporate partner first has such control).
``(2) Exception for certain distributions before control
acquired.--Paragraph (1) shall not apply to any distribution of
stock in the distributed corporation if--
``(A) the corporate partner does not have control of such
corporation immediately after such distribution, and
``(B) the corporate partner establishes to the satisfaction
of the Secretary that such distribution was not part of a plan
or arrangement to acquire control of the distributed
corporation.
``(3) Limitations on basis reduction.--
``(A) In general.--The amount of the reduction under
paragraph (1) shall not exceed the amount by which the sum of
the aggregate adjusted bases of the property and the amount of
money of the distributed corporation exceeds the corporate
partner's adjusted basis in the stock of the distributed
corporation.
``(B) Reduction not to exceed adjusted basis of property.--
No reduction under paragraph (1) in the basis of any property
shall exceed the adjusted basis of such property (determined
without regard to such reduction).
``(4) Gain recognition where reduction limited.--If the amount
of any reduction under paragraph (1) (determined after the
application of paragraph (3)(A)) exceeds the aggregate adjusted
bases of the property of the distributed corporation--
``(A) such excess shall be recognized by the corporate
partner as long-term capital gain, and
``(B) the corporate partner's adjusted basis in the stock
of the distributed corporation shall be increased by such
excess.
``(5) Control.--For purposes of this subsection, the term
`control' means ownership of stock meeting the requirements of
section 1504(a)(2).
``(6) Indirect distributions.--For purposes of paragraph (1),
if a corporation acquires (other than in a distribution from a
partnership) stock the basis of which is determined (by reason of
being distributed from a partnership) in whole or in part by
reference to subsection (a)(2) or (b), the corporation shall be
treated as receiving a distribution of such stock from a
partnership.
``(7) Special rule for stock in controlled corporation.--If the
property held by a distributed corporation is stock in a
corporation which the distributed corporation controls, this
subsection shall be applied to reduce the basis of the property of
such controlled corporation. This subsection shall be reapplied to
any property of any controlled corporation which is stock in a
corporation which it controls.
``(8) Regulations.--The Secretary shall prescribe such
regulations as may be necessary to carry out the purposes of this
subsection, including regulations to avoid double counting and to
prevent the abuse of such purposes.''.
(b) Effective Dates.--
(1) In general.--Except as provided in paragraph (2), the
amendment made by this section shall apply to distributions made
after July 14, 1999.
(2) Partnerships in existence on July 14, 1999.--In the case of
a corporation which is a partner in a partnership as of July 14,
1999, the amendment made by this section shall apply to any
distribution made (or treated as made) to such partner from such
partnership after June 30, 2001, except that this paragraph shall
not apply to any distribution after the date of the enactment of
this Act unless the partner makes an election to have this
paragraph apply to such distribution on the partner's return of
Federal income tax for the taxable year in which such distribution
occurs.
PART II--PROVISIONS RELATING TO REAL ESTATE INVESTMENT TRUSTS
Subpart A--Treatment of Income and Services Provided by Taxable REIT
Subsidiaries

ea5892d7b912b5af5a904f78224668958f7616cfa19a4fbabfb46f774d368744

(a) In General.--Subparagraph (B) of section 856(c)(4) of the
Internal Revenue Code of 1986 is amended to read as follows:
``(B)(i) not more than 25 percent of the value of its total
assets is represented by securities (other than those
includible under subparagraph (A)),
``(ii) not more than 20 percent of the value of its total
assets is represented by securities of one or more taxable REIT
subsidiaries, and
``(iii) except with respect to a taxable REIT subsidiary
and securities includible under subparagraph (A)--
``(I) not more than 5 percent of the value of its total
assets is represented by securities of any one issuer,
``(II) the trust does not hold securities possessing
more than 10 percent of the total voting power of the
outstanding securities of any one issuer, and
``(III) the trust does not hold securities having a
value of more than 10 percent of the total value of the
outstanding securities of any one issuer.''.
(b) Exception for Straight Debt Securities.--Subsection (c) of
section 856 of such Code is amended by adding at the end the following
new paragraph:
``(7) Straight debt safe harbor in applying paragraph (4).--
Securities of an issuer which are straight debt (as defined in
section 1361(c)(5) without regard to subparagraph (B)(iii) thereof)
shall not be taken into account in applying paragraph
(4)(B)(ii)(III) if--
``(A) the issuer is an individual, or
``(B) the only securities of such issuer which are held by
the trust or a taxable REIT subsidiary of the trust are
straight debt (as so defined), or
``(C) the issuer is a partnership and the trust holds at
least a 20 percent profits interest in the partnership.''.

0204e8a7623a6cbcf27d7f918856d95e8e8ab4cc4e4f592d757827378562c1c7

SUBSIDIARIES.
(a) Income From Taxable REIT Subsidiaries Not Treated as
Impermissible Tenant Service Income.--Clause (i) of section
856(d)(7)(C) of the Internal Revenue Code of 1986 (relating to
exceptions to impermissible tenant service income) is amended by
inserting ``or through a taxable REIT subsidiary of such trust'' after
``income''.
(b) Certain Income From Taxable REIT Subsidiaries Not Excluded From
Rents From Real Property.--
(1) In general.--Subsection (d) of section 856 of such Code
(relating to rents from real property defined) is amended by adding
at the end the following new paragraphs:
``(8) Special rule for taxable reit subsidiaries.--For purposes
of this subsection, amounts paid to a real estate investment trust
by a taxable REIT subsidiary of such trust shall not be excluded
from rents from real property by reason of paragraph (2)(B) if the
requirements of either of the following subparagraphs are met:
``(A) Limited rental exception.--The requirements of this
subparagraph are met with respect to any property if at least
90 percent of the leased space of the property is rented to
persons other than taxable REIT subsidiaries of such trust and
other than persons described in section 856(d)(2)(B). The
preceding sentence shall apply only to the extent that the
amounts paid to the trust as rents from real property (as
defined in paragraph (1) without regard to paragraph (2)(B))
from such property are substantially comparable to such rents
made by the other tenants of the trust's property for
comparable space.
``(B) Exception for certain lodging facilities.--The
requirements of this subparagraph are met with respect to an
interest in real property which is a qualified lodging facility
leased by the trust to a taxable REIT subsidiary of the trust
if the property is operated on behalf of such subsidiary by a
person who is an eligible independent contractor.
``(9) Eligible independent contractor.--For purposes of
paragraph (8)(B)--
``(A) In general.--The term `eligible independent
contractor' means, with respect to any qualified lodging
facility, any independent contractor if, at the time such
contractor enters into a management agreement or other similar
service contract with the taxable REIT subsidiary to operate
the facility, such contractor (or any related person) is
actively engaged in the trade or business of operating
qualified lodging facilities for any person who is not a
related person with respect to the real estate investment trust
or the taxable REIT subsidiary.
``(B) Special rules.--Solely for purposes of this paragraph
and paragraph (8)(B), a person shall not fail to be treated as
an independent contractor with respect to any qualified lodging
facility by reason of any of the following:
``(i) The taxable REIT subsidiary bears the expenses
for the operation of the facility pursuant to the
management agreement or other similar service contract.
``(ii) The taxable REIT subsidiary receives the
revenues from the operation of such facility, net of
expenses for such operation and fees payable to the
operator pursuant to such agreement or contract.
``(iii) The real estate investment trust receives
income from such person with respect to another property
that is attributable to a lease of such other property to
such person that was in effect as of the later of--
``(I) January 1, 1999, or
``(II) the earliest date that any taxable REIT
subsidiary of such trust entered into a management
agreement or other similar service contract with such
person with respect to such qualified lodging facility.
``(C) Renewals, etc., of existing leases.--For purposes of
subparagraph (B)(iii)--
``(i) a lease shall be treated as in effect on January
1, 1999, without regard to its renewal after such date, so
long as such renewal is pursuant to the terms of such lease
as in effect on whichever of the dates under subparagraph
(B)(iii) is the latest, and
``(ii) a lease of a property entered into after
whichever of the dates under subparagraph (B)(iii) is the
latest shall be treated as in effect on such date if--
``(I) on such date, a lease of such property from
the trust was in effect, and
``(II) under the terms of the new lease, such trust
receives a substantially similar or lesser benefit in
comparison to the lease referred to in subclause (I).
``(D) Qualified lodging facility.--For purposes of this
paragraph--
``(i) In general.--The term `qualified lodging
facility' means any lodging facility unless wagering
activities are conducted at or in connection with such
facility by any person who is engaged in the business of
accepting wagers and who is legally authorized to engage in
such business at or in connection with such facility.
``(ii) Lodging facility.--The term `lodging facility'
means a hotel, motel, or other establishment more than one-
half of the dwelling units in which are used on a transient
basis.
``(iii) Customary amenities and facilities.--The term
`lodging facility' includes customary amenities and
facilities operated as part of, or associated with, the
lodging facility so long as such amenities and facilities
are customary for other properties of a comparable size and
class owned by other owners unrelated to such real estate
investment trust.
``(E) Operate includes manage.--References in this
paragraph to operating a property shall be treated as including
a reference to managing the property.
``(F) Related person.--Persons shall be treated as related
to each other if such persons are treated as a single employer
under subsection (a) or (b) of section 52.''.
(2) Conforming amendment.--Subparagraph (B) of section
856(d)(2) of such Code is amended by inserting ``except as provided
in paragraph (8),'' after ``(B)''.
(3) Determining rents from real property.--
(A)(i) Paragraph (1) of section 856(d) of such Code is
amended by striking ``adjusted bases'' each place it occurs and
inserting ``fair market values''.
(ii) The amendment made by this subparagraph shall apply to
taxable years beginning after December 31, 2000.
(B)(i) Clause (i) of section 856(d)(2)(B) of such Code is
amended by striking ``number'' and inserting ``value''.
(ii) The amendment made by this subparagraph shall apply to
amounts received or accrued in taxable years beginning after
December 31, 2000, except for amounts paid pursuant to leases
in effect on July 12, 1999, or pursuant to a binding contract
in effect on such date and at all times thereafter.

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Ticket to Work and Work Incentives Improvement Act of 1999

Other Sections

TITLE I

TITLE II

TITLE III

TITLE IV

TITLE V

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