Sec. 10612. Sanctions
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Section 413 is amended— by amending subsection (b)(5) to read as follows: if, by the end of the 90-day period beginning on the date of the termination, the Secretary has not found a qualified entity (or entities) described in paragraph (3), shall— make every effort to identify, without conducting a competition (unless the Secretary determines that conducting a competition would be feasible and appropriate), another qualified entity (or entities), in the same or a different community, willing and able to conduct one or more demonstration projects under this title that may differ from the project being terminated; in identifying a qualified entity (or entities) under subparagraph (A), give priority to qualified entities that— are participating in demonstration projects conducted under this title; have waiting lists for participants in such demonstration projects; and can demonstrate the availability of non-Federal funds described in section 405(c)(4), in addition to any such funds committed to any demonstration projects being conducted by the qualified entity at the time the Secretary considers identifying the entity under subparagraph (A), to be committed to the demonstration project (or projects) described in subparagraph
(A)as matching contributions; and if the Secretary identifies a qualified entity (or entities) under subparagraph (A)— transfer to the entity (or entities) control over the Reserve Fund established pursuant to section 407 with respect to the project being terminated; and authorize the entity (or entities) to use such Reserve Fund to conduct a demonstration project (or projects) in accordance with an application approved under subsection
(e)or (h)(2) of section 405 and the requirements of this title. ; and by adding at the end the following new subsection: In identifying another qualified entity (or entities) under paragraph
(3)or
(5)of subsection (b), the Secretary shall, to the extent practicable, select a qualified entity (or entities) in the community served by the demonstration project being terminated. . The amendment made by subsection
(a)shall apply to terminations occurring on or after the date of the enactment of this Act. The Secretary of Health and Human Services may apply such amendment to terminations occurring within the 1-year period ending on the day before the date of the enactment of this Act. In the case of such an application, any reference in such amendment to the date of the termination is deemed a reference to such date of enactment.