To establish the Millennium Challenge Corporation, and for other purposes.

June 11, 2003

Mr. LUGAR introduced the following bill; which was read twice and referred to the Committee on Foreign Relations

To establish the Millennium Challenge Corporation, 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; TABLE OF CONTENTS.

(a) SHORT TITLE- This Act may be cited as the `Millennium Challenge Act of 2003'.

(b) TABLE OF CONTENTS- The table of contents for this Act is as follows:

Sec. 1. Short title; table of contents.

Sec. 2. Findings; purpose.

Sec. 3. Definitions.

TITLE I--MILLENNIUM CHALLENGE ASSISTANCE

Sec. 101. Establishment and management of the Millennium Challenge Corporation.

Sec. 102. Authorization for Millennium Challenge assistance.

Sec. 103. Candidate country.

Sec. 104. Eligible country.

Sec. 105. Eligible entity.

Sec. 106. Millennium Challenge Contract.

Sec. 107. Suspension of assistance to an eligible country.

Sec. 108. Disclosure.

Sec. 109. Annual report to Congress.

TITLE II--STRUCTURE, FUNCTION, AND POWERS OF THE MILLENNIUM CHALLENGE CORPORATION

Sec. 201. Chief executive officer.

Sec. 202. Millennium Challenge Board.

Sec. 203. Coordination with USAID.

Sec. 204. Powers of the Corporation.

Sec. 205. Principal office.

Sec. 206. Personnel authorities.

Sec. 207. Personnel outside the United States.

Sec. 208. Use of services of other agencies.

Sec. 209. Administrative authorities.

Sec. 210. Applicability of chapter 91 of title 31, United States code.

TITLE III--THE MILLENNIUM CHALLENGE ACCOUNT AND AUTHORIZATION OF APPROPRIATIONS

Sec. 301. Establishment of the Millennium Challenge Account.

Sec. 302. Authorization of appropriations.

SEC. 2. FINDINGS; PURPOSE.

(a) FINDINGS- Congress makes the following findings:

(1) On March 14, 2002, President George W. Bush stated that `America supports the international development goals in the U.N. Millennium Declaration, and believes that the goals are a shared responsibility of developed and developing countries.' The President also called for a `new compact for global development, defined by new accountability for both rich and poor nations' and pledged support for increased assistance from the United States through the establishment of a Millennium Challenge Account for countries that govern justly, invest in their own people, and encourage economic freedom.

(2) The elimination of extreme poverty and the achievement of the other international development goals of the United Nations Millennium Declaration adopted by the United Nations General Assembly on September 8, 2000, are important objectives and it is appropriate for the United States to make development assistance available in a manner that will assist in achieving such goals.

(3) The availability of financial assistance through a Millennium Challenge Account, linked to performance by developing countries, can contribute significantly to the achievement of the international development goals of the United Nations Millennium Declaration.

(b) PURPOSES- The purposes of this Act are--

(1) to provide United States assistance for global development through the Millennium Challenge Corporation, as described in section 102; and

(2) to provide such assistance in a manner that promotes economic growth and the elimination of extreme poverty and strengthens good governance, economic freedom, and investments in people.

SEC. 3. DEFINITIONS.

In this Act:

(1) BOARD- The term `Board' means the Millennium Challenge Board established by section 202.

(2) CANDIDATE COUNTRY- The term `candidate country' means a country that meets the criteria set out in section 103.

(3) CEO- The term `CEO' means the chief executive officer of the Corporation.

(4) CORPORATION- The term `Corporation' means the Millennium Challenge Corporation established by section 101.

(5) ELIGIBLE COUNTRY- The term `eligible country' means a candidate country that is determined, under section 104, as being eligible to receive assistance under this Act.

(6) MILLENNIUM CHALLENGE ACCOUNT- The term `Millennium Challenge Account' means the account established under section 301.

TITLE I--MILLENNIUM CHALLENGE ASSISTANCE

SEC. 101. ESTABLISHMENT AND MANAGEMENT OF THE MILLENNIUM CHALLENGE CORPORATION.

(a) ESTABLISHMENT- There is established in the executive branch a corporation within the meaning of section 103 of title 5, United States Code, to be known as the Millennium Challenge Corporation with the structure, function, and powers described in title II.

(b) MANAGEMENT OF THE CORPORATION-

(1) IN GENERAL- The responsibility for the management of the Corporation shall be vested in a chief executive officer, who shall report to the Secretary of State.

(2) CONSULTATION- The CEO shall consult with the Board in carrying out the responsibility described in paragraph (1).

SEC. 102. AUTHORIZATION FOR MILLENNIUM CHALLENGE ASSISTANCE.

(a) AUTHORITY- The Corporation is authorized to provide assistance to an eligible entity consistent with the purposes of this Act set out in section 2(b) to conduct programs or projects consistent with the objectives of a Millennium Challenge Contract. Assistance provided under this Act may be provided notwithstanding any other provision of law.

(b) EXCEPTION- Assistance under this Act may not be used for military assistance or training.

(c) FORM OF ASSISTANCE- Assistance under this Act may be provided in the form of grants to eligible entities.

(d) COORDINATION- The provision of assistance under this Act shall be coordinated with other United States foreign assistance programs.

(e) APPLICATIONS- An eligible entity seeking assistance under this Act to conduct programs or projects consistent with the objectives of a Millennium Challenge Contract shall submit a proposal for the use of such assistance to the Board in such manner and accompanied by such information as the Board may reasonably require.

SEC. 103. CANDIDATE COUNTRY.

(a) IN GENERAL- A country is a candidate country for the purposes of this Act--

(1) during fiscal year 2004, if such country is eligible to receive loans from the International Development Association;

(2) during fiscal year 2005, if the per capita income of such country is less than the historical per capita income cutoff of the International Development Association for that year; and

(3) during any fiscal year after 2005--

(A) for which more than $5,000,000,000 has been appropriated to the Millennium Challenge Account, if the country is classified as a lower middle income country by the World Bank on the first day of such fiscal year; or

(B) for which not more than $5,000,000,000 has been appropriated to such Millennium Challenge Account, the per capita income of such country is less than the historical per capita income cutoff of the International Development Association for that year.

(b) LIMITATION ON ASSISTANCE TO CERTAIN CANDIDATE COUNTRIES- In a fiscal year in which subparagraph (A) of subsection (a)(3) applies with respect to determining candidate countries, not more than 20 percent of the amounts appropriated to the Millennium Challenge Account shall be available for assistance to countries that would not be candidate countries if subparagraph (B) of subsection (a)(3) applied during such year.

SEC. 104. ELIGIBLE COUNTRY.

(a) DETERMINATION BY THE BOARD- The Board shall determine whether a candidate country is an eligible country by evaluating the demonstrated commitment of the government of the candidate country to--

(1) just and democratic governance, including a demonstrated commitment to--

(A) promote political pluralism and the rule of law;

(B) respect human and civil rights;

(C) protect private property rights;

(D) encourage transparency and accountability of government; and

(E) limit corruption;

(2) economic freedom, including a demonstrated commitment to economic policies that--

(A) encourage citizens and firms to participate in global trade and international capital markets;

(B) promote private sector growth; and

(C) strengthen market forces in the economy; and

(3) investments in the people of such country, including improving the availability of educational opportunities and health care for all citizens of such country.

(b) ASSESSING ELIGIBILITY-

(1) IN GENERAL- To evaluate the demonstrated commitment of a candidate country for the purposes of subsection (a), the Board shall use objective and quantifiable indicators of a candidate country's performance with respect to the criteria described in paragraphs (1), (2), and (3) of such subsection.

(2) ANNUAL PUBLICATION OF INDICATORS-

(A) INITIAL PUBLICATION- Not later than 45 days prior to the final publication of indicators under subparagraph (B) in any year, the Board shall publish in the Federal Register and make available on the Internet the indicators that the Board proposes to use for the purposes of paragraph (1) in such year.

(B) FINAL PUBLICATION- Not later than 15 days prior to the selection of eligible countries in any year, the Board shall publish in the Federal Register and make available on the Internet the indicators that are to be used for the purposes of paragraph (1) in such year.

(3) CONSIDERATION OF PUBLIC COMMENT- The Board shall consider any comments on the proposed indicators published under paragraph (2)(A) that are received within 30 days after the publication of such indicators when selecting the indicators to be used for the purposes of paragraph (1).

SEC. 105. ELIGIBLE ENTITY.

(a) ASSISTANCE- Any eligible entity may receive assistance under this Act to carry out a project in an eligible country for the purpose of making progress toward achieving an objective of a Millennium Challenge Contract.

(b) DETERMINATIONS OF ELIGIBILITY- The Board shall determine whether a person or governmental entity is an eligible entity for the purposes of this section.

(c) ELIGIBLE ENTITIES- For the purposes of this section, an eligible entity is--

(1) a government, including a local or regional government; or

(2) a nongovernmental organization or other private entity.

SEC. 106. MILLENNIUM CHALLENGE CONTRACT.

(a) IN GENERAL- The Board shall invite the government of an eligible country to enter into a Millennium Challenge Contract with the Corporation. A Millennium Challenge Contract shall establish a multiyear plan for the eligible country to achieve specific objectives consistent with the purposes set out in section 2(b).

(b) CONTENT- A Millennium Challenge Contract shall include--

(1) specific objectives to be achieved by the eligible country during the term of the Contract;

(2) a description of the actions to be taken by the government of the eligible country and the United States Government for achieving such objectives;

(3) the role and contribution of private entities, nongovernmental organizations, and other organizations in achieving such objectives;

(4) a description of beneficiaries, to the extent possible disaggregated by gender;

(5) regular benchmarks for measuring progress toward achieving such objectives;

(6) a schedule for achieving such objectives;

(7) a schedule of evaluations to be performed to determine whether the country is meeting its commitments under the Contract;

(8) a statement that the Corporation intends to consider the eligible country's performance in achieving such objectives in making decisions about providing continued assistance under the Contract;

(9) the strategy of the eligible country to sustain progress made toward achieving such objectives after the expiration of the Contract;

(10) a plan to ensure financial accountability for any assistance provided to a person or government in the eligible country under this Act; and

(11) a statement that nothing in the Contract may be construed to create a legally binding or enforceable obligation on the United States Government or on the Corporation.

(c) REQUIREMENT FOR CONSULTATION- The Corporation shall seek to ensure that the government of an eligible country consults with private entities and nongovernmental organizations in the eligible country for the purpose of ensuring that the terms of a Millennium Challenge Contract entered into by the Corporation and the eligible country--

(1) reflect the needs of the rural and urban poor in the eligible country; and

(2) provide means to assist poor men and women in the eligible country to escape poverty through their own efforts.

SEC. 107. SUSPENSION OF ASSISTANCE TO AN ELIGIBLE COUNTRY.

The Secretary of State shall direct the CEO to suspend the provision of assistance to an eligible country under a Millennium Challenge Contract during any period for which such eligible country is ineligible to receive assistance under a provision of the Foreign Assistance Act of 1961 (22 U.S.C. 2151 et seq.).

SEC. 108. DISCLOSURE.

(a) REQUIREMENT FOR DISCLOSURE- The Corporation shall make available to the public on a continuous basis and on the earliest possible date, the following information:

(1) A list of the candidate countries determined to be eligible countries during any year.

(2) The text of each Millennium Challenge Contract entered into by the Corporation.

(3) For assistance provided under this Act--

(A) the name of each entity to which assistance is provided;

(B) the amount of assistance provided to the entity; and

(C) a description of the program or project for which assistance was provided.

(4) For each eligible country, an assessment of--

(A) the progress made during each year by an eligible country toward achieving the objectives set out in the Millennium Challenge Contract entered into by the eligible country; and

(B) the extent to which assistance provided under this Act has been effective in helping the eligible country to achieve such objectives.

(b) DISSEMINATION- The information required to be disclosed under subsection (a) shall be made available to the public by means of publication in the Federal Register and posting on the Internet, as well as by any other methods that the Board determines appropriate.

SEC. 109. ANNUAL REPORT TO CONGRESS.

Not later than January 31 of each year, the President shall submit to Congress a report on the assistance provided under this Act during the prior fiscal year. The report shall include--

(1) information regarding obligations and expenditures for assistance provided to each eligible country in the prior fiscal year;

(2) a discussion, for each eligible country, of the objectives of such assistance;

(3) a description of the coordination of assistance under this Act with other United States foreign assistance and related trade policies;

(4) a description of the coordination of assistance under this Act with the contributions of other donors; and

(5) any other information the President considers relevant to assistance provided under this Act.

TITLE II--STRUCTURE, FUNCTION, AND POWERS OF THE MILLENNIUM CHALLENGE CORPORATION

SEC. 201. CHIEF EXECUTIVE OFFICER.

(a) IN GENERAL- The President shall appoint, by and with the advice and consent of the Senate, a chief executive officer of the Corporation.

(b) RELATIONSHIP TO THE SECRETARY OF STATE- The CEO shall report to and be under the direct authority and foreign policy guidance of the Secretary of State. The Secretary of State shall coordinate the provision of United States foreign assistance.

(c) DUTIES- The CEO shall, in consultation with the Board, direct the performance of all functions and the exercise of all powers of the Corporation, including--

(1) ensuring program and policy coordination among agencies of the United States Government in carrying out this Act;

(2) ensuring that assistance under this Act is coordinated with other United States economic assistance programs;

(3) pursuing coordination with other countries and international organizations with respect to assistance to countries receiving assistance under this Act;

(4) ensuring proper management, implementation, and oversight by agencies of the United States Government responsible for assistance under this Act; and

(5) resolving policy, program, and funding disputes among agencies of the United States Government involved in carrying out this Act.

(d) EXECUTIVE LEVEL II- Section 5313 of title 5, United States Code, is amended by adding at the end the following:

`Chief Executive Officer, Millennium Challenge Corporation.'.

SEC. 202. MILLENNIUM CHALLENGE BOARD.

(a) ESTABLISHMENT OF THE BOARD- There is established a Millennium Challenge Board.

(b) COMPOSITION- The Board shall be composed of the following members:

(1) The Secretary of State, who shall serve as the Chair of the Board.

(2) The Secretary of the Treasury.

(3) The Administrator of the United States Agency for International Development.

(4) The CEO.

(5) The United States Trade Representative.

(c) FUNCTIONS OF THE BOARD- The Board shall perform the functions specified to be carried out by the Board in this Act.

SEC. 203. COORDINATION WITH USAID.

(a) REQUIREMENT FOR COORDINATION- An employee of the Corporation assigned to a United States diplomatic mission or consular post or a United States Agency for International Development field mission in a foreign country shall, in a manner that is consistent with the authority of the Chief of Mission, coordinate the performance of the functions of the Corporation in such country with the officer in charge of the United States Agency of International Development programs located in such country.

(b) USAID PROGRAMS- The Administrator of the United States Agency for International Development shall seek to ensure that appropriate programs of the Agency play a primary role in preparing candidate countries to become eligible countries under section 104.

SEC. 204. POWERS OF THE CORPORATION.

(a) POWERS- The Corporation--

(1) shall have perpetual succession unless dissolved by an Act of Congress;

(2) may adopt, alter, and use a seal, which shall be judicially noticed;

(3) may prescribe, amend, and repeal such rules, regulations, and procedures as may be necessary for carrying out the functions of the Corporation;

(4) may make and perform such contracts, grants, and other agreements with any person or government however designated and wherever situated, as may be necessary for carrying out the functions of the Corporation;

(5) may determine and prescribe the manner in which its obligations shall be incurred and its expenses allowed and paid, including expenses for representation;

(6) may lease, purchase, or otherwise acquire, improve, and use such real property wherever situated, as may be necessary for carrying out the functions of the Corporation;

(7) may accept cash gifts or donations of services or of property (real, personal, or mixed), tangible or intangible, for the purpose of carrying out the provisions of this Act;

(8) may use the United States mails in the same manner and on the same conditions as the executive departments of Government;

(9) may contract with individuals for personal services, who shall not be considered Federal employees for any provision of law administered by the Office of Personnel Management;

(10) may hire or obtain passenger motor vehicles; and

(11) shall have such other powers as may be necessary and incident to carrying out this Act.

(b) CONTRACTING AUTHORITY- The functions and powers authorized by this Act may be performed without regard to any provision of law regulating the making, performance, amendment, or modification of contracts, grants, and other agreements.

SEC. 205. PRINCIPAL OFFICE.

The Corporation shall maintain its principal office in the metropolitan area of Washington, District of Columbia.

SEC. 206. PERSONNEL AUTHORITIES.

(a) REQUIREMENT TO PRESCRIBE A HUMAN RESOURCES MANAGEMENT SYSTEM- The CEO shall, jointly with the Director of the Office of Personnel Management, prescribe regulations that establish a human resources management system, including a retirement benefits program, for the Corporation.

(b) RELATIONSHIP TO OTHER LAWS-

(1) INAPPLICABILITY OF CERTAIN LAWS- Except as provided in paragraph (2), the provisions of title 5, United States Code, and of the Foreign Service Act of 1980 (22 U.S.C. 3901 et seq.) shall not apply to the human resource management program established pursuant to paragraph (1).

(2) APPLICATION OF CERTAIN LAWS- The human resources management system established pursuant to subsection (a) may not waive, modify, or otherwise affect the application to employees of the Corporation of the following provisions:

(A) Section 2301 of title 5, United States Code.

(B) Section 2302(b) of such title.

(C) Chapter 63 of such title (relating to leave).

(D) Chapter 72 of such title (relating to antidiscrimination).

(E) Chapter 73 of such title (relating to suitability, security, and conduct).

(F) Chapter 81 of such title (relating to compensation for work injuries).

(G) Chapter 85 of such title (relating to unemployment compensation).

(H) Chapter 87 of such title (relating to life insurance).

(I) Chapter 89 of such title (relating to health insurance).

(J) Chapter 90 of such title (relating to long-term care insurance).

(3) RELATIONSHIP TO RETIREMENT BENEFITS LAWS- The retirement benefits program referred to in subsection (a) shall permit the employees of the

Corporation to be eligible, unless the CEO determines otherwise, for benefits under--

(A) subchapter III of chapter 83 and chapter 84 of title 5, United States Code (relating to retirement benefits); or

(B) chapter 8 of title I of the Foreign Service Act of 1980 (22 U.S.C. 4041 et seq.) (relating to the Foreign Service Retirement and Disability System).

(c) APPOINTMENT AND TERMINATION- Except as otherwise provided in this section, the CEO may, without regard to any civil service or Foreign Service law or regulation, appoint and terminate employees as may be necessary to enable the Corporation to perform its duties.

(d) COMPENSATION-

(1) AUTHORITY TO FIX COMPENSATION- Subject to the provisions of paragraph (2), the CEO may fix the compensation of employees of the Corporation.

(2) LIMITATIONS ON COMPENSATION- The compensation for an employee of the Corporation may not exceed the lesser of--

(A) the rate of compensation established under title 5, United States Code, or any Foreign Service law for an employee of the Federal Government who holds a position that is comparable to the position held by the employee of the Corporation; or

(B) the rate of pay prescribed for level IV of the Executive Schedule under section 5315 of title 5, United States Code.

(e) TERM OF EMPLOYMENT-

(1) IN GENERAL- Except as provided in paragraphs (2) and (3), no individual may be employed by the Corporation for a total period of employment that exceeds 5 years.

(2) EXCEPTED POSITIONS- The CEO, and not more than 3 other employees of the Corporation who are designated by the CEO, may be employed by the Corporation for an unlimited period of employment.

(3) WAIVER- The CEO may waive the maximum term of employment described in paragraph (1) if the CEO determines that such waiver is essential to the achievement of the purposes of this Act.

(f) AUTHORITY FOR TEMPORARY EMPLOYEES- The CEO may procure temporary and intermittent services under section 3109(b) of title 5, United States Code, at rates for individuals which do not exceed the daily equivalent of the annual rate of basic pay prescribed for level V of the Executive Schedule under section 5316 of such title.

(g) DETAIL OF FEDERAL EMPLOYEES TO THE CORPORATION- Any Federal Government employee may be detailed to the Corporation on a fully or partially reimbursable or on a nonreimbursable basis, and such detail shall be without interruption or loss of civil service or Foreign Service status or privilege.

(h) REINSTATEMENT- An employee of the Federal Government serving under a career or career conditional appointment, or the equivalent, in a Federal agency who transfers to or converts to an appointment in the Corporation with the consent of the head of the agency is entitled to be returned to the employee's former position or a position of like seniority, status, and pay without grade or pay reduction in the agency if the employee--

(1) is being separated from the Corporation for reasons other than misconduct, neglect of duty, or malfeasance; and

(2) applies for return to the agency not later than 30 days before the date of the termination of the employment in the Corporation.

SEC. 207. PERSONNEL OUTSIDE THE UNITED STATES.

(a) ASSIGNMENT TO UNITED STATES EMBASSIES- An employee of the Corporation, including an individual detailed to or contracted by the Corporation, may be assigned to a United States diplomatic mission or consular post or a United States Agency for International Development field mission.

(b) PRIVILEGES AND IMMUNITIES- The Secretary of State shall seek to ensure that an employee of the Corporation, including an individual detailed to or contracted by the Corporation, and the members of the family of such employee, while the employee is performing duties in any country or place outside the United States, enjoy the privileges and immunities that are enjoyed by a member of the Foreign Service, or the family of a member of the Foreign Service, as appropriate, of comparable rank and salary of such employee, if such employee or a member of the family of such employee is not a national of or permanently resident in such country or place.

(c) RESPONSIBILITY OF CHIEF OF MISSION- An employee of the Corporation, including an individual detailed to or contracted by the Corporation, and a member of the family of such employee, shall be subject to section 207 of the Foreign Service Act of 1980 (22 U.S.C. 3927) in the same manner as United States Government employees while the employee is performing duties in any country or place outside the United States if such employee or

member of the family of such employee is not a national of or permanently resident in such country or place.

SEC. 208. USE OF SERVICES OF OTHER AGENCIES.

The Corporation may utilize the information services, facilities and personnel of, or procure commodities from, any agency of the United States Government on a fully or partially reimbursable or nonreimbursable basis under such terms and conditions as may be agreed to by the head of such agency and the Corporation for carrying out this Act.

SEC. 209. ADMINISTRATIVE AUTHORITIES.

The Corporation is authorized to use any of the administrative authorities contained in the State Department Basic Authorities Act of 1956 (22 U.S.C. 2651a et seq.) and the Foreign Assistance Act of 1961 (22 U.S.C. 2151 et seq.) unless such authority is inconsistent with a provision of this Act.

SEC. 210. APPLICABILITY OF CHAPTER 91 OF TITLE 31, UNITED STATES CODE.

The Corporation shall be subject to chapter 91 of title 31, United States Code.

TITLE III--THE MILLENNIUM CHALLENGE ACCOUNT AND AUTHORIZATION OF APPROPRIATIONS

SEC. 301. ESTABLISHMENT OF THE MILLENNIUM CHALLENGE ACCOUNT.

There is established on the books of the Treasury an account to be known as the Millennium Challenge Account that shall be administered by the CEO under the direction of the Board. All amounts made available to carry out the provisions of this Act shall be deposited into such Account and such amounts shall be available to carry out such provisions.

SEC. 302. AUTHORIZATION OF APPROPRIATIONS.

(a) IN GENERAL- There are authorized to be appropriated to carry out the provisions of this Act $1,000,000,000 for fiscal year 2004, $2,300,000,000 for fiscal year 2005, and $5,000,000,000 for fiscal year 2006.

(b) AVAILABILITY- Funds appropriated under subsection (a)--

(1) are authorized to remain available until expended, subject to appropriations acts; and

(2) are in addition to funds otherwise available for such purposes.

(c) ALLOCATION OF FUNDS-

(1) IN GENERAL- The Corporation may allocate or transfer to any agency of the United States Government any of the funds available for carrying out this Act. Such funds shall be available for obligation and expenditure for the purposes for which authorized, in accordance with authority granted in this Act or under authority governing the activities of the agencies of the United States Government to which such funds are allocated or transferred.

(2) NOTIFICATION- The notification requirements of section 634A(a) of the Foreign Assistance Act of 1961 (22 U.S.C. 2394-1(a)) shall apply to any allocation or transfer of funds made pursuant to paragraph (1).

END