Improper payment rate requiring corrective action plan; conditional ineligibility

Section 658J of the Child Care and Development Block Grant Act of 1990 (42 U.S.C. 9858h) is amended— (1) by redesignating subsection (c) as subsection (e); and (2) by inserting after subsection (b) the following: (c) improper payment threshold requiring corrective action plan If for a fiscal year the improper payment rate of a State is more than 5 percent of the aggregate amount of payments made to carry out this subchapter by such State for such fiscal year, then such State shall submit to the Secretary— (1) for review and approval a corrective action plan to reduce such rate to not more than 5 percent for each subsequent fiscal year; and (2) such reports as the Secretary may require to show that such State is complying with the requirements of such plan as approved by the Secretary. (d) Conditional ineligibility If for each of 2 consecutive fiscal years the improper payment rate of a State determined under this section is more than 5 percent, then such State shall be ineligible to receive funds under this subchapter unless such State demonstrates to the satisfaction of the Secretary that such State for the next fiscal year will— (1) reduce such improper payment rate to not more than 5 percent for the next fiscal year; or (2) make significant progress to comply with the corrective action plan approved under subsection (c)..