((a)) ** Amounts payable each quarter**

((1)) From the sums appropriated therefor, the Secretary shall pay to each State for each quarter an amount—

((A)) equal to the percent specified in paragraph (2) of the total amounts expended by such State during such quarter for the operation of the plan approved under ,

((B)) equal to the percent specified in paragraph (3) of the sums expended during such quarter that are attributable to the planning, design, development, installation or enhancement of an automatic data processing and information retrieval system (including in such sums the full cost of the hardware components of such system); and

((C)) equal to 66 percent of so much of the sums expended during such quarter as are attributable to laboratory costs incurred in determining paternity, and

((D)) equal to 66 percent of the sums expended by the State during the quarter for an alternative statewide system for which a waiver has been granted under , but only to the extent that the total of the sums so expended by the State on or after , does not exceed the least total cost estimate submitted by the State pursuant to in the request for the waiver;

((2)) The percent applicable to quarters in a fiscal year for purposes of paragraph (1)(A) is—

((A)) 70 percent for fiscal years 1984, 1985, 1986, and 1987,

((B)) 68 percent for fiscal years 1988 and 1989, and

((C)) 66 percent for fiscal year 1990 and each fiscal year thereafter.

((3))

((A)) The Secretary shall pay to each State, for each quarter in fiscal years 1996 and 1997, 90 percent of so much of the State expenditures described in paragraph (1)(B) as the Secretary finds are for a system meeting the requirements specified in (as in effect on ) but limited to the amount approved for States in the advance planning documents of such States submitted on or before .

((B))

((i)) The Secretary shall pay to each State or system described in clause (iii), for each quarter in fiscal years 1996 through 2001, the percentage specified in clause (ii) of so much of the State or system expenditures described in paragraph (1)(B) as the Secretary finds are for a system meeting the requirements of sections 654(16) and 654a of this title.

((ii)) The percentage specified in this clause is 80 percent.

((iii)) For purposes of clause (i), a system described in this clause is a system that has been approved by the Secretary to receive enhanced funding pursuant to the Family Support Act of 1988 (; ) for the purpose of developing a system that meets the requirements of sections 654(16) of this title (as in effect on and after ) and 654a of this title, including systems that have received funding for such purpose pursuant to a waiver under .

((4))

((A))

((i)) If—

((I)) the Secretary determines that a State plan under would (in the absence of this paragraph) be disapproved for the failure of the State to comply with a particular subparagraph of , and that the State has made and is continuing to make a good faith effort to so comply; and

((II)) the State has submitted to the Secretary a corrective compliance plan that describes how, by when, and at what cost the State will achieve such compliance, which has been approved by the Secretary,

((ii)) All failures of a State during a fiscal year to comply with any of the requirements referred to in the same subparagraph of shall be considered a single failure of the State to comply with that subparagraph during the fiscal year for purposes of this paragraph.

((B)) In this paragraph:

((i)) The term “penalty amount” means, with respect to a failure of a State to comply with a subparagraph of —

((I)) 4 percent of the penalty base, in the case of the first fiscal year in which such a failure by the State occurs (regardless of whether a penalty is imposed under this paragraph with respect to the failure);

((II)) 8 percent of the penalty base, in the case of the second such fiscal year;

((III)) 16 percent of the penalty base, in the case of the third such fiscal year;

((IV)) 25 percent of the penalty base, in the case of the fourth such fiscal year; or

((V)) 30 percent of the penalty base, in the case of the fifth or any subsequent such fiscal year.

((ii)) The term “penalty base” means, with respect to a failure of a State to comply with a subparagraph of during a fiscal year, the amount otherwise payable to the State under paragraph (1)(A) of this subsection for the preceding fiscal year.

((C))

((i)) The Secretary shall waive a penalty under this paragraph for any failure of a State to comply with during fiscal year 1998 if—

((I)) on or before , the State has submitted to the Secretary a request that the Secretary certify the State as having met the requirements of such section;

((II)) the Secretary subsequently provides the certification as a result of a timely review conducted pursuant to the request; and

((III)) the State has not failed such a review.

((ii)) If a State with respect to which a reduction is made under this paragraph for a fiscal year with respect to a failure to comply with a subparagraph of achieves compliance with such subparagraph by the beginning of the succeeding fiscal year, the Secretary shall increase the amount otherwise payable to the State under paragraph (1)(A) of this subsection for the succeeding fiscal year by an amount equal to 90 percent of the reduction for the fiscal year.

((iii)) The Secretary shall reduce the amount of any reduction that, in the absence of this clause, would be required to be made under this paragraph by reason of the failure of a State to achieve compliance with during the fiscal year, by an amount equal to 20 percent of the amount of the otherwise required reduction, for each State performance measure described in with respect to which the applicable percentage under for the fiscal year is 100 percent, if the Secretary has made the determination described in with respect to the State for the fiscal year.

((D)) The Secretary may not impose a penalty under this paragraph against a State with respect to a failure to comply with for a fiscal year if the Secretary is required to impose a penalty under this paragraph against the State with respect to a failure to comply with for the fiscal year.

((5))

((A))

((i)) If—

((I)) the Secretary determines that a State plan under would (in the absence of this paragraph) be disapproved for the failure of the State to comply with subparagraphs (A) and (B)(i) of , and that the State has made and is continuing to make a good faith effort to so comply; and

((II)) the State has submitted to the Secretary, not later than , a corrective compliance plan that describes how, by when, and at what cost the State will achieve such compliance, which has been approved by the Secretary,

((ii)) All failures of a State during a fiscal year to comply with any of the requirements of shall be considered a single failure of the State to comply with subparagraphs (A) and (B)(i) of during the fiscal year for purposes of this paragraph.

((B)) In this paragraph:

((i)) The term “penalty amount” means, with respect to a failure of a State to comply with subparagraphs (A) and (B)(i) of —

((I)) 4 percent of the penalty base, in the case of the 1st fiscal year in which such a failure by the State occurs (regardless of whether a penalty is imposed in that fiscal year under this paragraph with respect to the failure), except as provided in subparagraph (C)(ii) of this paragraph;

((II)) 8 percent of the penalty base, in the case of the 2nd such fiscal year;

((III)) 16 percent of the penalty base, in the case of the 3rd such fiscal year;

((IV)) 25 percent of the penalty base, in the case of the 4th such fiscal year; or

((V)) 30 percent of the penalty base, in the case of the 5th or any subsequent such fiscal year.

((ii)) The term “penalty base” means, with respect to a failure of a State to comply with subparagraphs (A) and (B)(i) of during a fiscal year, the amount otherwise payable to the State under paragraph (1)(A) of this subsection for the preceding fiscal year.

((C))

((i)) The Secretary shall waive all penalties imposed against a State under this paragraph for any failure of the State to comply with subparagraphs (A) and (B)(i) of if the Secretary determines that, before , the State has achieved such compliance.

((ii)) If a State with respect to which a reduction is required to be made under this paragraph with respect to a failure to comply with subparagraphs (A) and (B)(i) of achieves such compliance on or after , and on or before , then the penalty amount applicable to the State shall be 1 percent of the penalty base with respect to the failure involved.

((D)) The Secretary may not impose a penalty under this paragraph against a State for a fiscal year for which the amount otherwise payable to the State under paragraph (1)(A) of this subsection is reduced under paragraph (4) of this subsection for failure to comply with .

((b)) ** Estimate of amounts payable; installment payments**

((1)) Prior to the beginning of each quarter, the Secretary shall estimate the amount to which a State will be entitled under subsection (a) for such quarter, such estimates to be based on (A) a report filed by the State containing its estimate of the total sum to be expended in such quarter in accordance with the provisions of such subsection, and stating the amount appropriated or made available by the State and its political subdivisions for such expenditures in such quarter, and if such amount is less than the State’s proportionate share of the total sum of such estimated expenditures, the source or sources from which the difference is expected to be derived, and (B) such other investigation as the Secretary may find necessary.

((2)) Subject to subsection (d), the Secretary shall then pay, in such installments as he may determine, to the State the amount so estimated, reduced or increased to the extent of any overpayment or underpayment which the Secretary determines was made under this section to such State for any prior quarter and with respect to which adjustment has not already been made under this subsection.

((3)) Upon the making of any estimate by the Secretary under this subsection, any appropriations available for payments under this section shall be deemed obligated.

((c)) ** Repealed. , , **

((d)) ** State reports** Notwithstanding any other provision of law, no amount shall be paid to any State under this section for any quarter, prior to the close of such quarter, unless for the period consisting of all prior quarters for which payment is authorized to be made to such State under subsection (a), there shall have been submitted by the State to the Secretary, with respect to each quarter in such period (other than the last two quarters in such period), a full and complete report (in such form and manner and containing such information as the Secretary shall prescribe or require) as to the amount of child support collected and disbursed and all expenditures with respect to which payment is authorized under subsection (a).

((e)) ** Special project grants for interstate enforcement; appropriations**

((1)) In order to encourage and promote the development and use of more effective methods of enforcing support obligations under this part in cases where either the children on whose behalf the support is sought or their noncustodial parents do not reside in the State where such cases are filed, the Secretary is authorized to make grants, in such amounts and on such terms and conditions as the Secretary determines to be appropriate, to States which propose to undertake new or innovative methods of support collection in such cases and which will use the proceeds of such grants to carry out special projects designed to demonstrate and test such methods.

((2)) A grant under this subsection shall be made only upon a finding by the Secretary that the project involved is likely to be of significant assistance in carrying out the purpose of this subsection; and with respect to such project the Secretary may waive any of the requirements of this part which would otherwise be applicable, to such extent and for such period as the Secretary determines is necessary or desirable in order to enable the State to carry out the project.

((3)) At the time of its application for a grant under this subsection the State shall submit to the Secretary a statement describing in reasonable detail the project for which the proceeds of the grant are to be used, and the State shall from time to time thereafter submit to the Secretary such reports with respect to the project as the Secretary may specify.

((4)) Amounts expended by a State in carrying out a special project assisted under this section shall be considered, for purposes of section 658(b)  of this title (as amended by section 5(a) of the Child Support Enforcement Amendments of 1984), to have been expended for the operation of the State’s plan approved under .

((5)) There is authorized to be appropriated the sum of $7,000,000 for fiscal year 1985, $12,000,000 for fiscal year 1986, and $15,000,000 for each fiscal year thereafter, to be used by the Secretary in making grants under this subsection.

((f)) ** Direct Federal funding to Indian tribes and tribal organizations** The Secretary may make direct payments under this part to an Indian tribe or tribal organization that demonstrates to the satisfaction of the Secretary that it has the capacity to operate a child support enforcement program meeting the objectives of this part, including establishment of paternity, establishment, modification, and enforcement of support orders, and location of absent parents. The Secretary shall promulgate regulations establishing the requirements which must be met by an Indian tribe or tribal organization to be eligible for a grant under this subsection.