PUBLIC LAW 104-188—AUG. 20, 1996 110 STAT. 1903 (d) STUDY AND REPORT. — The Secretary of the Treasury shall 26 USC 23 note, study the effect on adoptions of the tax credit and gross income exclusion established by the amendments made by this section and shall submit a report regarding the study to the Committee on Finance of the Senate and the Committee on Ways and Means of the House of Representatives not later than January 1, 2000. (e) EFFECTIVE DATE. —The amendments made by this section shall apply to taxable years beginning after December 31, 1996. SEC. 1808. REMOVAL OF BARRIERS TO INTERETHNIC ADOPTION. (a) STATE PLAN REQUIREMENTS. —Section 471(a) of the Social Security Act (42 U.S.C 671(a)) is amended— (1) by striking "and" at the end of paragraph (16); (2) by striking the period at the end of paragraph (17) and inserting "; and"; and (3) by adding at the end the following: "(18) not later than January 1, 1997, provides that neither the State nor any other entity in the State that receives funds from the Federal Government and is involved in adoption or foster care placements may— "(A) deny to any person the opportunity to become an adoptive or a foster parent, on the basis of the race, color, or national origin of the person, or of the child, involved; or "(B) delay or deny the placement of a child for adoption or into foster care, on the basis of the race, color, or national origin of the adoptive or foster parent, or the child, involved.". (b) ENFORCEMENT. —Section 474 of such Act (42 U.S.C. 674) is amended by adding at the end the following: "(d)(1) If, during any quarter of a fiscal year, a State's program operated under this part is found, as a result of a review conducted under section 1123A, or otherwise, to have violated section 471(a)(18) with respect to a person or to have failed to implement a corrective action plan within a period of time not to exceed 6 months with respect to such violation, then, notwithstanding subsection (a) of this section and any regulations promulgated under section 1123A(b)(3), the Secretary shall reduce the amount otherwise payable to the State under this part, for that fiscal year quarter and for any subsequent quarter of such fiscal year, until the State program is found, as a result of a subsequent review under section 1123A, to have implemented a corrective action plan with respect to such violation, by— "(A) 2 percent of such otherwise payable amount, in the case of the 1st such finding for the fiscal year with respect to the State; "(B) 3 percent of such otherwise payable amount, in the case of the 2nd such finding for the fiscal year with respect to the State; or "(C) 5 percent of such otherwise payable amount, in the case of the 3rd or subsequent such finding for the fiscal year with respect to the State. In imposing the penalties described in this paragraph, the Secretary shall not reduce any fiscal year payment to a State by more than 5 percent. "(2) Any other entity which is in a State that receives funds under this part and which violates section 471(a)(18) during a
�
