PUBLIC LAW 103-448—NOV. 2, 1994 108 STAT. 4737 "(7) The Secretary shall allow States to apply on an annual basis for assistance under this subsection. "(8) Each State agency and State, in allocating funds within the State, shall give preference for assistance under this subsection to eligible schools and service institutions that demonstrate the greatest need for a school breakfast program or a summer food service program for children, respectively. "(9) Expenditures of funds from State and local sources for the maintenance of the school breakfast program and the summer food service program for children shall not be diminished as a result of payments received under this subsection. "(10) As used in this subsection: "(A) The term 'eligible school' means a school— "(i) attended by children a significant percentage of whom are members of low-income families; "(ii)(I) as used with respect to a school breakfast program, that agrees to operate the school breakfast program established or expanded with the assistance provided under this subsection for a period of not less than 3 years; and "(11) as used with respect to a summer food service program for children, that agrees to operate the summer food service program for children established or expanded with the assistance provided under this subsection for a period of not less than 3 years. "(B) The term 'service institution' means an institution or organization described in paragraph (1)(B) or (7) of section 13(a) of the National School Lunch Act (42 U.S.C. 1761(a)(1)(B) or (7)). "(C) The term 'summer food service program for children' means a program authorized by section 13 of such Act (42 U.S.C. 1761). ' ° SEC. 202. STATE ADMINISTRATIVE EXPENSES. (a) WITHHOLDING.— Section 7(a) of the Child Nutrition Act of 1966 (42 U.S.C. 1776(a)) is amended by adding at the end the following new paragraph: "(9)(A) If the Secretary determines that the administration of any program by a State under this Act (other than section 17) or under the National School Lunch Act (42 U.S.C. 1751 et seq.), or compliance with a regulation issued pursuant to either of such Acts, is seriously deficient, and the State fails to correct the deficiency within a specified period of time, the Secretary may withhold from the State some or all of the funds allocated to the State under this section or under section 13(k)(l) or 17 of the National School Lunch Act (42 U.S.C. 1761(k)(l) or 1766). "(B) On a subsequent determination by the Secretary that the administration of any program referred to in subparagraph (A), or compliance with the regulations issued to carry out the program, is no longer seriously deficient and is operated in an acceptable manner, the Secretary may allocate some or all of the funds withheld under such subpsiragraph.". (b) EXTENSION OF AUTHORITY TO PROVIDE FUNDS FOR STATE ADMINISTRATIVE EXPENSES.— Section 7(h) of such Act (42 U.S.C. 1776(h)) is amended by striking "1994" and inserting "1998". (c) PROHIBITION OF FUNDING UNLESS STATE AGREES TO PARTICI- PATE IN CERTAIN STUDIES OR SURVEYS.— Section 7 of such Act (42 U.S.C. 1776) is amended—
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