HR 2975 IH

To establish grant programs to provide opportunities for adolescents, to establish training programs for teachers, and to establish job training courses at community colleges, to amend the Elementary and Secondary Education Act of 1965 to reduce class size, and for other purposes.

September 29, 1999

Ms. HOOLEY of Oregon introduced the following bill; which was referred to the Committee on Education and the Workforce, and in addition to the Committee on Ways and Means, for a period to be subsequently determined by the Speaker, in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned

To establish grant programs to provide opportunities for adolescents, to establish training programs for teachers, and to establish job training courses at community colleges, to amend the Elementary and Secondary Education Act of 1965 to reduce class size, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Youth Education Development Act of 1999'.

SEC. 2. DEFINITIONS.

In this Act:

(1) ADOLESCENT- The term `adolescent' means an individual who is less than 16 years of age but not less than 10 years of age.

(2) COMMISSIONER- The term `Commissioner' means the Commissioner of the Administration for Children, Youth, and Families in the Department of Health and Human Services.

(3) COMMUNITY-BASED ORGANIZATION- The term `community-based organization' has the meaning given such term in section 101(7) of the Workforce Investment Act of 1998 (29 U.S.C. 2801(7)).

(4) COMMUNITY COLLEGE- The term `community college' has the meaning given such term in section 312(e) of the Higher Education Act of 1965 (20 U.S.C. 1058(e)).

(5) ELEMENTARY SCHOOL- The term `elementary school' has the meaning given such term in section 14101(14) of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 8801(14)).

(6) INSTITUTION OF HIGHER EDUCATION- The term `institution of higher education' has the meaning given such term in section 101(a) of the Higher Education Act of 1965 (20 U.S.C. 1001(a)).

(7) LOCAL EDUCATIONAL AGENCY- The term `local educational agency' has the meaning given such term in section 14101(18) of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 8801(18)).

(8) SECONDARY SCHOOL- The term `secondary school' has the meaning given such term in section 14101(25) of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 8801(25)).

(9) SECRETARY- The term `Secretary' means the Secretary of Education.

TITLE I--GRANT PROGRAM TO PROVIDE OPPORTUNITIES FOR ADOLESCENTS

SEC. 101. GENERAL PROVISIONS.

(a) AUTHORITY TO MAKE GRANTS- The Commissioner of the Administration for Children, Youth, and Families may make grants on a competitive basis to public agencies and nonprofit private organizations for programs and activities described in sections 102, 103, 104, and 105. In making such grants, the Commissioner shall give special consideration to agencies and organizations that propose to carry out such projects and activities jointly with one or more other such agencies or organizations.

(b) LIMITATIONS-

(1) MAXIMUM AMOUNT OF GRANT- A grant made under subsection (a) in any fiscal year to a particular agency or organization may not exceed $500,000.

(2) MAXIMUM NUMBER OF GRANTS- Not more than 3 grants may be made under subsection (a) to carry out a particular program or activity.

(c) ELIGIBILITY REQUIREMENTS- To be eligible to receive a grant under subsection (a), a public agency or nonprofit private organization shall submit an application to the Commissioner at such time, in such form, and containing such assurances and information as the Commissioner may require by rule, including--

(1) an assurance that such grant will be expended to pay not more than 70 percent of the cost (including the value of in-kind contributions to the cost) of the program or activity for which such grant is requested;

(2) an assurance that not more than 10 percent of such grant will be used to pay administrative costs (other than staff training) incurred to carry out such program or activity;

(3) an assurance that not less than 25 percent of such grant will be used to provide training (especially training in adolescent development) to staff who will administer such program or activity; and

(4) information demonstrating that--

(A) the applicant--

(i) intends to promote positive behavior, and to prevent negative outcomes, in adolescents;

(ii) empowers adolescents, values all adolescents, and actively engages adolescents in the development and operation of such program or activity;

(iii) has established clear goals and objectives for such program or activity and has identified a method to evaluate the effectiveness of such program or activity; and

(iv) will involve in carrying out such program or activity, committed staff and volunteers who possess appropriate skills and knowledge; and

(B) such program or activity will--

(i) reinforce the role of the family in, and the contribution of family members to, the positive development of adolescents;

(ii) give adolescents an opportunity to develop new skills, primarily through `hands-on' and other interactive learning processes;

(iii) be flexible to accommodate the experience, interests, family background, gender, and race or ethnicity of participating adolescents; and

(iv) supplement, and not supplant, other programs and activities being carried out in the community.

SEC. 102. GRANTS TO IMPROVE EDUCATIONAL PERFORMANCE.

The Commissioner may make grants under section 101(a) to improve the educational performance of adolescents, to enhance their learning ability, to develop their knowledge and appreciation of music, drama, writing, reading, art, foreign languages, mathematics, and science, and to develop their awareness of the multicultural nature of society. Such grants may be used--

(1) to develop curricular and educational materials specifically designed for adolescents;

(2) to provide peer counseling to help adolescents make successful transitions among elementary, intermediate, and secondary schools;

(3) to carry out activities to promote academic achievement by adolescents;

(4) to carry out programs designed to help adolescents enjoy and appreciate learning, particularly programs that emphasize writing, reading, mathematics, or science; and

(5) such other programs and activities as the Commissioner considers to be appropriate.

SEC. 103. GRANTS TO IMPROVE HEALTH AND FITNESS.

The Commissioner may make grants under section 101(a) to improve the health and fitness of adolescents. Such grants may be used--

(1) to carry out competitive and noncompetitive sports activities;

(2) to carry out recreational activities designed--

(A) to promote the development of physical and social skills,

(B) to foster a spirit of adventure;

(C) to provide opportunities for appropriate risk-taking; and

(D) to teach an appreciation of the physical environment;

(3) to carry out community-based programs designed--

(A) to increase adolescents' awareness of their responsibility for their health; and

(B) to promote positive health behaviors;

(4) to carry out mental health programs, especially those designed to reduce the incidence of adolescent depression and suicide; and

(5) such other programs and activities as the Commissioner considers to be appropriate.

SEC. 104. GRANTS TO DEVELOP LIFE SKILLS.

The Commissioner may make grants under section 101(a) to develop the social competence, life skills, and leadership skills of adolescents, and to promote the application of such skills through community service and community action. Such grants may be used to carry out--

(1) programs that prepare adolescents for adulthood, including employment, parenthood, and civic participation;

(2) programs that teach basic life skills, including interpersonal communication, planning, goal setting, decision making, problem solving, conflict resolution, and cognitive strategies for resisting peer and media pressure;

(3) programs that teach social responsibility and leadership skills, and that actively promote the application of such skills through community problem solving and community service; and

(4) such other programs as the Commissioner considers to be appropriate.

SEC. 105. GRANTS TO IMPROVE FAMILY RELATIONSHIPS.

The Commissioner may make grants under section 101(a) to carry out programs to provide nonfinancial support and training to families of adolescents. Such grants may be used--

(1) to carry out supportive and educational activities for families of adolescents, including courses and workshops that teach parenting skills that are most effective in promoting healthy adolescent development;

(2) to carry out activities that provide opportunities for parents and adolescents to engage in mutually enjoyable and educational pursuits, such as recreation, community and volunteer service, and communication workshops;

(3) to provide counseling to families of adolescents to enable adolescents, their siblings, and their parents to resolve problems in family relationships; and

(4) to carry out such other activities as the Commissioner considers to be appropriate.

SEC. 106. AUTHORIZATION OF APPROPRIATIONS.

(a) FOR GRANTS TO IMPROVE EDUCATIONAL PERFORMANCE- There are authorized to be appropriated $45,000,000 for fiscal year 2000, and such sums as may be necessary for each of the fiscal years 2001, 2002, 2003, and 2004, to make grants under section 101(a) for the purposes described in section 102.

(b) FOR GRANTS TO IMPROVE HEALTH AND FITNESS- There are authorized to be appropriated $45,000,000 for fiscal year 2000, and such sums as may be necessary for each of the fiscal years 2001, 2002, 2003, and 2004, to make grants under section 101(a) for the purposes described in section 103.

(c) FOR GRANTS TO DEVELOP LIFE SKILLS- There are authorized to be appropriated $45,000,000 for fiscal year 2000, and such sums as may be necessary for each of the fiscal years 2001, 2002, 2003, and 2004, to make grants under section 101(a) for the purposes described in section 104.

(d) FOR GRANTS TO IMPROVE FAMILY RELATIONSHIPS- There are authorized to be appropriated

$45,000,000 for fiscal year 2000, and such sums as may be necessary for each of the fiscal years 2001, 2002, 2003, and 2004, to make grants under section 101(a) for the purposes described in section 105.

TITLE II--GRANT PROGRAM TO ESTABLISH TRAINING PROGRAMS FOR TEACHERS

SEC. 201. AUTHORIZATION.

(a) IN GENERAL- The Secretary shall make grants to eligible entities to establish training programs to upgrade the skills of teachers at elementary schools and secondary schools.

(b) PERIOD OF GRANT- The provision of payments under a grant under subsection (a) may extend over a period of not more than 5 fiscal years and shall be subject to annual approval by the Secretary and subject to the availability of appropriations for the fiscal year involved to make the payments.

SEC. 202. APPLICATION.

(a) IN GENERAL- To receive a grant under section 201(a), an eligible entity shall submit an application to the Secretary at such time, in such form, and containing such information as the Secretary may reasonably require.

(b) ASSURANCES- Such application shall include assurances that the eligible entity--

(1) has developed or shall develop a plan, including an evaluation component, for the training program established pursuant to section 203(a);

(2) shall use Federal funds received from a grant under section 201(a) to supplement, not supplant, non-Federal funds that would otherwise be available for projects funded under such section; and

(3) shall provide, with respect to any fiscal year in which such entity receives funds from a grant under section 201(a), non-Federal funds in an amount equal to 30 percent of funds from such grant, an in kind contribution equivalent to such percent (as determined by the Secretary), or a combination thereof, for the purpose of carrying out the training program established pursuant to section 203(a).

SEC. 203. USE OF FUNDS.

(a) TRAINING PROGRAM- Grants made under section 201(a) may be used by an eligible entity only for establishing a training program to--

(1) provide teachers at elementary schools and secondary schools the opportunity to participate in teacher internships which are related to the course of study taught by such teachers; and

(2) provide education courses for such teachers related to the course of study taught by such teachers.

(b) CONDUCT OF PROGRAM- In conducting the program established pursuant to subsection (a), an eligible entity shall--

(1) require a teacher participating in the program to sign a learning contract specifying the length of the internship or education course, the desired results of such internship or education course, and the remuneration to be provided the teacher for participation in the program; and

(2) ensure that no jobs are lost or employees displaced as a result of the program.

SEC. 204. REPORTS.

An eligible entity that receives a grant under section 201(a) shall submit to the Secretary in each fiscal year in which the entity receives amounts from such grant a report that describes the training program established pursuant to section 203(a), the number of teachers served in the program, and an evaluation of the program.

SEC. 205. ALLOCATION REQUIREMENT.

The Secretary may not make grants under section 201(a) to any eligible entity in an amount totaling more than 5 percent of amounts appropriated under section 207.

SEC. 206. ELIGIBLE ENTITY DEFINED.

For purposes of this title, the term `eligible entity' means a consortium consisting of--

(1) local educational agencies or institutions of higher education, or both;

(2) a teacher association;

(3) representatives of business and industry associations; and

(4) labor organizations.

SEC. 207. AUTHORIZATION OF APPROPRIATIONS.

(a) IN GENERAL- There is authorized to be appropriated for fiscal year 2000 $25,000,000 and such sums as may be necessary for each of the fiscal years 2001, 2002, 2003, and 2005 to carry out section 201(a).

(b) AVAILABILITY- Amounts appropriated under subsection (a) shall remain available until expended.

TITLE III--GRANT PROGRAM TO ESTABLISH JOB TRAINING COURSES AT COMMUNITY COLLEGES

SEC. 301. AUTHORIZATION.

(a) IN GENERAL- The Secretary shall make grants to community colleges to establish job training courses at such colleges.

(b) PERIOD OF GRANT- The provision of payments under a grant under subsection (a) may extend over a period of not more than 5 fiscal years and shall be subject to annual approval by the Secretary and subject to the availability of appropriations for the fiscal year involved to make the payments.

SEC. 302. APPLICATION.

(a) IN GENERAL- To receive a grant under section 301(a), a community college shall submit an application to the Secretary at such time, in such form, and containing such information as the Secretary may reasonably require.

(b) ASSURANCES- Such application shall include assurances that the community college--

(1) has developed or shall develop a plan, including an evaluation component, for projects established pursuant to section 303;

(2) shall use Federal funds received from a grant under section 301(a) to supplement, not supplant, non-Federal funds that would otherwise be available for projects funded under such section; and

(3) shall provide, with respect to any fiscal year in which such college receives funds from a grant under section 301(a), non-Federal funds in an amount equal to 30 percent of funds from such grant, an in kind contribution equivalent to such percent (as determined by the Secretary), or a combination thereof, for the purpose of carrying out projects established pursuant to section 303.

SEC. 303. USE OF FUNDS.

Grants made under section 301(a) may be used by a community college only for--

(1) assessing the education and training needs of the regional labor market in which the community college is located;

(2) developing job training courses to meet the needs of the regional labor market, including instructional materials and competency-based assessment standards;

(3) providing inservice training for teachers of such courses; and

(4) purchasing equipment for use in such courses.

SEC. 304. REPORTS.

A community college that receives a grant under section 301(a) shall submit to the Secretary in each fiscal year in which the college receives amounts from such grant a report that describes the projects established pursuant to section 303, the number of individuals served by the projects, and an evaluation of the projects.

SEC. 305. ALLOCATION REQUIREMENT.

The Secretary may not make grants under section 301(a) to any eligible entity in an amount totaling more than 20 percent of amounts appropriated under section 306.

SEC. 306. AUTHORIZATION OF APPROPRIATIONS.

(a) IN GENERAL- There is authorized to be appropriated for fiscal year 2000, $45,000,000 and such sums as may be necessary for each of the fiscal years 2001, 2002, 2003 and 2005 to carry out section 301(a).

(b) AVAILABILITY- Amounts appropriated under subsection (a) shall remain available until expended.

TITLE IV--CLASS SIZE REDUCTION

SEC. 401. CLASS SIZE REDUCTION.

Title VI of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 7301 et seq.) is amended by adding at the end the following:

`PART E--CLASS SIZE REDUCTION

`SEC. 6601. SHORT TITLE.

`This part may be cited as the `Class Size Reduction and Teacher Quality Act of 1999'.

`SEC. 6604. PROGRAM AUTHORIZED.

`(a) AUTHORIZATION OF APPROPRIATIONS- For the purpose of carrying out this part, there are authorized to be appropriated, $1,400,000,000 for fiscal year 2000, $1,500,000,000 for fiscal year 2001, $1,700,000,000 for fiscal year 2002, $1,735,000,000 for fiscal year 2003, $2,300,000,000 for fiscal year 2004, and $2,800,000,000 for fiscal year 2005.

`(b) ALLOTMENTS-

`(1) IN GENERAL- From the amount appropriated under subsection (a) for a fiscal year the Secretary--

`(A) shall make a total of 1 percent available to the Secretary of the Interior (on behalf of the Bureau of Indian Affairs) and the outlying areas for activities that meet the purpose of this part; and

`(B) shall allot to each State the same percentage of the remaining funds as the percentage it received of funds allocated to States for the previous fiscal year under section 1122 or section 2202(b), whichever percentage is greater, except that such allotments shall be ratably decreased as necessary.

`(2) DEFINITION OF STATE- In this part the term `State' means each of the several States of the United States, the District of Columbia and the Commonwealth of Puerto Rico.

`(3) STATE-LEVEL EXPENSES- Each State may use not more than a total of 1/2 of 1 percent of the amount the State receives under this part, or $50,000, whichever is greater, for a fiscal year, for the administrative costs of the State educational agency.

`(c) Within State Distribution--

`(1) IN GENERAL- Each State that receives an allotment under this section shall distribute the amount of the allotted funds that remain after using funds in accordance with subsection (b)(3) to local educational agencies in the State, of which--

`(A) 80 percent of such remainder shall be allocated to such local educational agencies in proportion to the number of children, aged 5 to 17, who reside in the school district served by such local educational agency and are from families with incomes below the poverty line (as defined by the Office of Management and Budget and revised annually in accordance with section 673(2) of the Community Services Block Grant Act (42 U.S.C. 9902(2)) applicable to a family of the size involved) for the most recent fiscal year for which satisfactory data is available compared to the number of such individuals who reside in the school districts served by all the local educational agencies in the State for that fiscal year, except that a State may adjust such data; and

`(B) 20 percent of such remainder shall be allocated to such local educational agencies in accordance with the relative enrollments of children, aged 5 to 17, in public and private nonprofit elementary schools and secondary schools in the school districts within the boundaries of such agencies.

`(2) AWARD RULE- Notwithstanding paragraph (1), if the award to a local educational agency under this section is less than the starting salary for a new teacher in that agency, the State shall not make the award unless--

`(A) the local educational agency agrees to form a consortium with not less than 1 other local educational agency for the purpose of reducing class size; or

`(B) the local educational agency agrees to supplement the award with non-Federal funds sufficient to pay the cost of hiring a teacher.

`SEC. 6605. USE OF FUNDS.

`(a) IN GENERAL- Each local educational agency that receives funds under this part shall use such funds to carry out effective approaches to reducing class size with highly qualified teachers to improve educational achievement for both regular and special-needs children, with particular consideration given to reducing class size in the early elementary grades for which some research has shown class size reduction is most effective.

`(b) Class Reduction--

`(1) IN GENERAL- Each such local educational agency may pursue the goal of reducing class size through--

`(A) recruiting, hiring, and training certified regular and special education teachers and teachers of special-needs children, including teachers certified through State and local alternative routes;

`(B) testing new teachers for academic content knowledge, and to meet State certification requirements that are consistent with title II of the Higher Education Act of 1965; and

`(C) providing professional development to teachers, including special education teachers and teachers of special-needs children, consistent with title II of the Higher Education Act of 1965.

`(2) RESTRICTION- A local educational agency may use not more than a total of 15 percent of the funds received under this part for each of the fiscal years 2000 through 2003 to carry out activities described in subparagraphs (B) and (C) of paragraph (1), and may not use any funds received under this part for fiscal year 2004 or 2005 for those activities.

`(3) SPECIAL RULE- A local educational agency that has already reduced class size in the early grades to 18 or fewer children may use funds received under this part--

`(A) to make further class-size reductions in grades 1 through 3;

`(B) to reduce class size in kindergarten or other grades; or

`(C) to carry out activities to improve teacher quality, including professional development activities.

`(c) SUPPLEMENT NOT SUPPLANT- A local educational agency shall use funds under this part only to supplement, and not to supplant, State and local funds that, in the absence of such funds, would otherwise be spent for activities under this part.

`(d) PROHIBITION- No funds made available under this part may be used to increase the salaries of or provide benefits to (other than participation in professional development and enrichment programs) teachers who are, or have been, employed by the local educational agency.

`(e) PROFESSIONAL DEVELOPMENT- If a local educational agency uses funds made available under this part for professional development activities, the agency shall ensure the equitable participation of private nonprofit elementary and secondary schools in such activities. Section 6402 shall not apply to other activities under this section.

`(f) ADMINISTRATIVE EXPENSES- A local educational agency that receives funds under this part may use not more than 3 percent of such funds for local administrative expenses.

`SEC. 6606. COST-SHARING REQUIREMENT.

`(a) FEDERAL SHARE- The Federal share of the cost of activities carried out under this part--

`(1) may be up to 100 percent in local educational agencies with child-poverty levels of 50 percent or greater; and

`(2) shall be no more than 65 percent for local educational agencies with child-poverty rates of less than 50 percent.

`(b) LOCAL SHARE- A local educational agency shall provide the non-Federal share of a project under this part through cash expenditures from non-Federal sources, except that if an agency has allocated funds under section 1113(c) to one or more schoolwide programs under section 1114, it may use those funds for the non-Federal share of activities under this program that benefit those schoolwide programs, to the extent consistent with section 1120A(c) and notwithstanding section 1114(a)(3)(B).

`SEC. 6607. REQUEST FOR FUNDS.

`Each local educational agency that desires to receive funds under this part shall include in the application submitted under section 6303 a description of the agency's program under this part to reduce class size by hiring additional highly qualified teachers.

`SEC. 6608. REPORTS.

`(a) STATE- Each State receiving funds under this part shall report on activities in the State under this section, consistent with section 6202(a)(2).

`(b) SCHOOL- Each school receiving assistance under this part, or the local educational agency serving that school, shall produce an annual report to parents, the general public, and the State educational agency, in easily understandable language, regarding student achievement that is a result of hiring additional highly qualified teachers and reducing class size.'.

TITLE V--SCHOOL MODERNIZATION

SEC. 501. CREDIT TO HOLDERS OF QUALIFIED PUBLIC SCHOOL CONSTRUCTION BONDS.

(a) IN GENERAL- Subpart B of part IV of subchapter A of chapter 1 of the Internal Revenue Code of 1986 is amended by adding at the end the following new section:

`SEC. 30B. CREDIT TO HOLDERS OF QUALIFIED PUBLIC SCHOOL CONSTRUCTION BONDS.

`(a) ALLOWANCE OF CREDIT- In the case of a taxpayer who holds a qualified school construction bond on a credit allowance date of such bond which occurs during the taxable year, there shall be allowed as a credit against the tax imposed by this chapter for such taxable year an amount equal to the sum of the credits determined under subsection (b) with respect to credit allowance dates during such year on which the taxpayer holds such bond.

`(b) AMOUNT OF CREDIT-

`(1) IN GENERAL- The amount of the credit determined under this subsection with respect to any credit allowance date for a qualified school construction bond is 25 percent of the annual credit determined with respect to such bond.

`(2) ANNUAL CREDIT- The annual credit determined with respect to any qualified school construction bond is the product of--

`(A) the applicable credit rate, multiplied by

`(B) the outstanding face amount of the bond.

`(3) APPLICABLE CREDIT RATE- For purposes of paragraph (1), the applicable credit rate with respect to an issue is the rate equal to an average market yield (as of the day before the date of issuance of the issue) on outstanding long-term corporate debt obligations (determined under regulations prescribed by the Secretary).

`(4) SPECIAL RULE FOR ISSUANCE AND REDEMPTION- In the case of a bond which is issued during the 3-month period ending on a credit allowance date, the amount of the credit determined under this subsection with respect to such credit allowance date shall be a ratable portion of the credit otherwise determined based on the portion of the 3-month period during which the bond is outstanding. A similar rule shall apply when the bond is redeemed.

`(c) QUALIFIED SCHOOL CONSTRUCTION BOND- For purposes of this section--

`(1) IN GENERAL- The term `qualified school construction bond' means any bond issued as part of an issue if--

`(A) 95 percent or more of the proceeds of such issue are to be used for the construction, rehabilitation, or repair of a public school facility or for the acquisition of land on which such a facility is to be constructed with part of the proceeds of such issue,

`(B) the bond is issued by a State or local government within the jurisdiction of which such school is located,

`(C) the issuer designates such bond for purposes of this section, and

`(D) the term of each bond which is part of such issue does not exceed 15 years.

`(2) LIMITATION ON AMOUNT OF BONDS DESIGNATED- The maximum aggregate face amount of bonds issued during any calendar year which may be designated under paragraph (1) by any issuer shall not exceed the limitation amount allocated under paragraph (3) for such calendar year to such issuer.

`(3) NATIONAL LIMITATION ON AMOUNT OF BONDS DESIGNATED- There is a national qualified school construction bond limitation for each calendar year. Such limitation is--

`(A) $12,500,000,000 for 2000,

`(B) $12,500,000,000 for 2001, and

`(C) except as provided in paragraph (5), zero after 2001.

`(4) ALLOCATION OF LIMITATION AMONG STATES-

`(A) IN GENERAL- The limitation applicable under paragraph (3) for any calendar year shall be allocated among the States by the Secretary. The amount allocated to a State for a calendar year shall be equal to the sum of--

`(i) the amount allocated to the State for such year under subparagraph (B), and

`(ii) the amount allocated to the State for such year under subparagraph (C).

The limitation amount allocated to a State under the preceding sentence shall be allocated by the State education agency to issuers within such State and such allocations may be made only if there is an approved State application.

`(B) ALLOCATION ON BASIS OF BASIC GRANTS UNDER TITLE I OF THE ELEMENTARY AND SECONDARY EDUCATION ACT OF 1965- One-half of the limitation applicable under paragraph (3) for any calendar year shall be allocated among the States in proportion to the respective amounts each such State received for basic grants under subpart 2 of part A of title I of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 6331 et seq.) for the most recent fiscal year ending before such calendar year.

`(C) ALLOCATION ON BASIS OF TOTAL ELEMENTARY AND SECONDARY SCHOOL AGE POPULATION- One-half of the limitation applicable under paragraph (3) for any calendar year shall be allocated among the States in proportion to the respective numbers of children in each State who have attained age 5 but not age 18 for the most recent fiscal year ending before such calendar year.

`(D) MINIMUM ALLOCATIONS TO STATES-

`(i) IN GENERAL- The Secretary shall adjust the allocations under this paragraph for any calendar year for each State to the extent necessary to ensure that the amount allocated to such State under this paragraph for such year is not less than an amount equal to such State's minimum percentage of one-half of the amount to be allocated under subparagraph (A) for the calendar year.

`(ii) MINIMUM PERCENTAGE- A State's minimum percentage for any calendar year is the minimum percentage described in section 1124(d) of the Elementary and Secondary Education Act of 1965 (20 U.S.C. 6334(d)) for such State for the most recent fiscal year ending before such calendar year.

`(E) ALLOCATIONS TO CERTAIN POSSESSIONS- The amount to be allocated under subparagraph (A) to any possession of the United States other than Puerto Rico shall be the amount which would have been allocated if all allocations under subparagraph (A) were made on the basis of respective populations of individuals below the poverty line (as defined by the Office of Management and Budget). In making other allocations, the amount to be allocated under subparagraph (A) shall be reduced by the aggregate amount allocated under this subparagraph to possessions of the United States.

`(F) APPROVED STATE APPLICATION- For purposes of subparagraph (A), the term `approved State application' means an application which is approved by the Secretary of Education and which includes--

`(i) the results of a recent publicly-available survey (undertaken by the State with the involvement of local education officials, members of the public, and experts in school construction and management) of such State's needs for public school facilities, including descriptions of--

`(I) health and safety problems at such facilities,

`(II) the capacity of public schools in the State to house projected enrollments,

`(III) the extent to which the public schools in the State offer the physical infrastructure needed to provide a high-quality education to all students, and

`(ii) a description of how the State will allocate to local educational agencies, or otherwise use, its allocation under this subsection to address the needs identified under subparagraph (A), including a description of how it will--

`(I) give high priority to localities with the greatest needs, as demonstrated by inadequate school facilities coupled with a low level of resources to meet those needs,

`(II) use its allocation under this subsection to assist localities that lack the fiscal capacity to issue bonds on their own,

`(III) ensure that its allocation under this subsection is used only to supplement, and not supplant, the amount of school construction, rehabilitation, and repair in the State that would have occurred in the absence of such allocation, and

`(IV) ensure that the needs of both rural and urban areas are recognized.

Any allocation under subparagraph (A) by a State education agency shall be binding if such agency reasonably determined that the allocation was in accordance with the plan approved under this subparagraph.

`(5) CARRYOVER OF UNUSED LIMITATION- If for any calendar year--

`(A) the amount allocated under paragraph (4) to any State, exceeds

`(B) the amount of bonds issued during such year which are designated under paragraph (1) pursuant to such allocation,

the limitation amount under paragraph (4) for such State for the following calendar year shall be increased by the amount of such excess.

`(d) LIMITATION BASED ON AMOUNT OF TAX-

`(1) IN GENERAL- The credit allowed under subsection (a) for any taxable year shall not exceed the excess of--

`(A) the sum of the regular tax liability (as defined in section 26(b)) plus the tax imposed by section 55, over

`(B) the sum of the credits allowable under part IV of subchapter A (other than subpart C thereof, relating to refundable credits).

`(2) CARRYOVER OF UNUSED CREDIT- If the credit allowable under subsection (a) exceeds the limitation imposed by paragraph (1) for such taxable year, such excess shall be carried to the succeeding taxable year and added to the credit allowable under subsection (a) for such taxable year.

`(e) OTHER DEFINITIONS- For purposes of this section--

`(1) CREDIT ALLOWANCE DATE- The term `credit allowance date' means--

`(A) March 15,

`(B) June 15,

`(C) September 15, and

`(D) December 15.

Such term includes the last day on which the bond is outstanding.

`(2) LOCAL EDUCATIONAL AGENCY- The term `local educational agency' has the meaning given to such term by section 14101 of the Elementary and Secondary Education Act of 1965. Such term includes the local educational agency that serves the District of Columbia but does not include any other State agency.

`(3) BOND- The term `bond' includes any obligation.

`(4) STATE- The term `State' includes the District of Columbia and any possession of the United States.

`(5) PUBLIC SCHOOL FACILITY- The term `public school facility' shall not include--

`(A) any stadium or other facility primarily used for athletic contests or exhibitions or other events for which admission is charged to the general public, or

`(B) any facility which is not owned by a State or local government or any agency or instrumentality of a State or local government.

`(f) CREDIT INCLUDED IN GROSS INCOME- Gross income includes the amount of the credit allowed to the taxpayer under this section (determined without regard to subsection (d)) and the amount so included shall be treated as interest income.

`(g) BONDS HELD BY REGULATED INVESTMENT COMPANIES- If any qualified school construction bond is held by a regulated investment company, the credit determined under subsection (a) shall be allowed to shareholders of such company under procedures prescribed by the Secretary.

`(h) CREDITS MAY BE STRIPPED- Under regulations prescribed by the Secretary--

`(1) IN GENERAL- There may be a separation (including at issuance) of the ownership of a qualified school construction bond and the entitlement to the credit under this section with respect to such bond. In case of any such separation, the credit under this section shall be allowed to the person who on the credit allowance date holds the instrument evidencing the entitlement to the credit and not to the holder of the bond.

`(2) CERTAIN RULES TO APPLY- In the case of a separation described in paragraph (1), the rules of section 1286 shall apply to the qualified school construction bond as if it were a stripped bond and to the credit under this section as if it were a stripped coupon.

`(i) TREATMENT FOR ESTIMATED TAX PURPOSES- Solely for purposes of sections 6654 and 6655, the credit allowed by this section to a taxpayer by reason of holding a qualified school construction bond on a credit allowance date shall be treated as if it were a payment of estimated tax made by the taxpayer on such date.

`(j) CREDIT MAY BE TRANSFERRED- Nothing in any law or rule of law shall be construed to limit the transferability of the credit allowed by this section through sale and repurchase agreements.

`(k) REPORTING- Issuers of qualified school construction bonds shall submit reports similar to the reports required under section 149(e).

`(l) TERMINATION- This section shall not apply to any bond issued after December 31, 2004.'

(b) REPORTING- Subsection (d) of section 6049 of such Code (relating to returns regarding payments of interest) is amended by adding at the end the following new paragraph:

`(8) REPORTING OF CREDIT ON QUALIFIED SCHOOL CONSTRUCTION BONDS-

`(A) IN GENERAL- For purposes of subsection (a), the term `interest' includes amounts includible in gross income under section 30B(f) and such amounts shall be treated as paid on the credit allowance date (as defined in section 30B(e)(1)).

`(B) REPORTING TO CORPORATIONS, ETC- Except as otherwise provided in regulations, in the case of any interest described in subparagraph (A) of this paragraph, subsection (b)(4) of this section shall be applied without regard to subparagraphs (A), (H), (I), (J), (K), and (L)(i).

`(C) REGULATORY AUTHORITY- The Secretary may prescribe such regulations as are necessary or appropriate to carry out the purposes of this paragraph, including regulations which require more frequent or more detailed reporting.'

(c) CONFORMING AMENDMENTS-

(1) Subchapter U of chapter 1 of such Code is amended by striking part IV, by redesignating part V as part IV, and by redesignating section 1397F as section 1397E.

(2) The table of parts of subchapter U of chapter 1 of such Code is amended by striking the last 2 items and inserting the following item:

`Part IV. Regulations.'

(3) The table of sections for subpart B of part IV of subchapter A of chapter 1 of such Code is amended by adding at the end the following new item:

`Sec. 30B. Credit to holders of qualified public school construction bonds.'

(d) EFFECTIVE DATE- The amendments made by this section shall apply to obligations issued after December 31, 1999.

SEC. 502. APPLICATION OF CERTAIN LABOR STANDARDS ON CONSTRUCTION PROJECTS FINANCED UNDER PUBLIC SCHOOL CONSTRUCTION PROGRAM.

Section 439 of the General Education Provisions Act (relating to labor standards) is amended--

(1) by inserting `(a)' before `All laborers and mechanics'; and

(2) by adding at the end the following:

`(b)(1) For purposes of this section, the term `applicable program' also includes the qualified zone academy bond provisions enacted by section 226 of the Taxpayer Relief Act of 1997 and the program established by section 501 of the Youth Development Act of 1999.

`(2) A State or local government participating in a program described in paragraph (1) shall--

`(A) in the awarding of contracts, give priority to contractors with substantial numbers of employees residing in the local education area to be served by the school being constructed; and

`(B) include in the construction contract for such school a requirement that the contractor give priority in hiring new workers to individuals residing in such local education area.

`(3) In the case of a program described in paragraph (1), nothing in this subsection or subsection (a) shall be construed to deny any tax credit allowed under such program. If amounts are required to be withheld from contractors to pay wages to which workers are entitled, such amounts shall be treated as expended for construction purposes in determining whether the requirements of such program are met.'.

SEC. 503. EMPLOYMENT AND TRAINING ACTIVITIES RELATING TO CONSTRUCTION OR RECONSTRUCTION OF PUBLIC SCHOOL FACILITIES.

(a) IN GENERAL- Section 134 of the Workforce Investment Act of 1998 (29 U.S.C. 2864) is amended by adding at the end the following:

`(f) LOCAL EMPLOYMENT AND TRAINING ACTIVITIES RELATING TO CONSTRUCTION OR RECONSTRUCTION OF PUBLIC SCHOOL FACILITIES-

`(1) IN GENERAL- In order to provide training services related to construction or reconstruction of public school facilities receiving funding assistance under an applicable program, each State shall establish a specialized program of training meeting the following requirements:

`(A) The specialized program provides training for jobs in the construction industry.

`(B) The program is designed to provide trained workers for projects for the construction or reconstruction of public school facilities receiving funding assistance under an applicable program.

`(C) The program is designed to ensure that skilled workers (residing in the area to be served by the school facilities) will be available for the construction or reconstruction work.

`(2) COORDINATION- The specialized program established under paragraph (1) shall be integrated with other activities under this Act, with the activities carried out under the National Apprenticeship Act of 1937 by the State Apprenticeship Council or through the Bureau of Apprenticeship and Training in the Department of Labor, as appropriate, and with activities carried out under the Carl D. Perkins Vocational and Technical Education Act of 1998. Nothing in this subsection shall be construed to require services duplicative of those referred to in the preceding sentence.

`(3) APPLICABLE PROGRAM- In this subsection, the term `applicable program' has the meaning given the term in section 439(b) of the General Education Provisions Act (relating to labor standards).'.

(b) STATE PLAN- Section 112(b)(17)(A) of the Workforce Investment Act of 1998 (29 U.S.C. 2822(b)(17)(A)) is amended--

(1) in clause (iii), by striking `and' at the end;

(2) by redesignating clause (iv) as clause (v); and

(3) by inserting after clause (iii) the following:

`(iv) how the State will establish and carry out a specialized program of training under section 134(f); and'.

TITLE VI--ACCESS TO POST SECONDARY EDUCATION

SECTION. 601. INCREASE IN MAXIMUM PELL GRANTS.

Section 401(b)(2)(A) of the Higher Education Act of 1965 (20 U.S.C. 1070a(b)(2)(A)) is amended

(1) by inserting `and' after the semicolon at the end of clause (i); and

(2) by striking clauses (ii) through (v) and inserting the following:

`(ii) $6,500 for each of the academic years 2000-2001, 2001-2002, 2002-2003, and 2003-2004,'.

END