View all text of Chapter 106 [§ 9901 - § 9926]
§ 9907. Uses of funds
(a) Grants to eligible entities and other organizations
(1) In general
(2) Obligational authority
(3) Recapture and redistribution of unobligated funds
(A) Amount
(B) Redistribution
(b) Statewide activities
(1) Use of remainderIf a State uses less than 100 percent of the grant or allotment received under section 9905 or 9906 of this title to make grants under subsection (a), the State shall use the remainder of the grant or allotment under section 9905 or 9906 of this title (subject to paragraph (2)) for activities that may include—
(A) providing training and technical assistance to those entities in need of such training and assistance;
(B) coordinating State-operated programs and services, and at the option of the State, locally-operated programs and services, targeted to low-income children and families with services provided by eligible entities and other organizations funded under this chapter, including detailing appropriate employees of State or local agencies to entities funded under this chapter, to ensure increased access to services provided by such State or local agencies;
(C) supporting statewide coordination and communication among eligible entities;
(D) analyzing the distribution of funds made available under this chapter within the State to determine if such funds have been targeted to the areas of greatest need;
(E) supporting asset-building programs for low-income individuals, such as programs supporting individual development accounts;
(F) supporting innovative programs and activities conducted by community action agencies or other neighborhood-based organizations to eliminate poverty, promote self-sufficiency, and promote community revitalization;
(G) supporting State charity tax credits as described in subsection (c); and
(H) supporting other activities, consistent with the purposes of this chapter.
(2) Administrative cap
(c) Charity tax credit
(1) In general
(2) Limit
(3) Definitions and rulesIn this subsection:
(A) Charity tax credit
(B) Qualified charity
(i) In generalThe term “qualified charity” means any organization—(I) that is—(aa) described in section 501(c)(3) of title 26 and exempt from tax under section 501(a) of such title;(bb) an eligible entity; or(cc) a public housing agency as defined in section 1437a(b)(6) of this title;(II) that is certified by the appropriate State authority as meeting the requirements of clauses (iii) and (iv); and(III) if such organization is otherwise required to file a return under section 6033 of such title, that elects to treat the information required to be furnished by clause (v) as being specified in section 6033(b) of such title.
(ii) Certain contributions to collection organizations treated as contributions to qualified charity(I) In general(II) Collection organizationThe term “collection organization” means an organization described in section 501(c)(3) of such title and exempt from tax under section 501(a) of such title—(aa) that solicits and collects gifts and grants that, by agreement, are distributed to qualified charities;(bb) that distributes to qualified charities at least 90 percent of the gifts and grants the organization receives that are designated for such qualified charities; and(cc) that meets the requirements of clause (vi).
(iii) Charity must primarily assist poor individuals(I) In general(II) No recordkeeping in certain cases(III) Food aid and homeless sheltersExcept as otherwise provided by the appropriate State authority, for purposes of subclause (I), services to individuals in the form of—(aa) donations of food or meals; or(bb) temporary shelter to homeless individuals;
shall be treated as provided to individuals described in subclause (I) if the location and provision of such services are such that the service provider may reasonably conclude that the beneficiaries of such services are predominantly individuals described in subclause (I).
(iv) Minimum expense requirement(I) In general(II) Poverty program expenseFor purposes of subclause (I)—(aa) In general(bb) Exceptions
(v) Reporting requirementThe information required to be furnished under this clause about an organization is—(I) the percentages determined by dividing the following categories of the organization’s expenses for the year by the total expenses of the organization for the year: expenses for direct services, management expenses, general expenses, fundraising expenses, and payments to affiliates; and(II) the category or categories (including food, shelter, education, substance abuse prevention or treatment, job training, or other) of services that constitute predominant activities of the organization.
(vi) Additional requirements for collection organizationsThe requirements of this clause are met if the organization—(I) maintains separate accounting for revenues and expenses; and(II) makes available to the public information on the administrative and fundraising costs of the organization, and information as to the organizations receiving funds from the organization and the amount of such funds.
(vii) Special rule for States requiring tax uniformityIn the case of a State—(I) that has a constitutional requirement of tax uniformity; and(II) that, as of December 31, 1997, imposed a tax on personal income with—(aa) a single flat rate applicable to all earned and unearned income (except insofar as any amount is not taxed pursuant to tax forgiveness provisions); and(bb) no generally available exemptions or deductions to individuals;
the requirement of paragraph (2) shall be treated as met if the amount of the credit described in paragraph (2) is limited to a uniform percentage (but not greater than 25 percent) of State personal income tax liability (determined without regard to credits).
(4) Limitation on use of funds for startup and administrative activities
(5) Prohibition on use of funds for legal services or tuition assistance
(6) Prohibition on supplanting funds
(Pub. L. 97–35, title VI, § 675C, as added Pub. L. 105–285, title II, § 201, Oct. 27, 1998, 112 Stat. 2731.)